Based in Elkhart, Indiana, Thor Industries manufactures Class A, Class B, and Class C motor homes along with travel trailers and fifth wheel towables across over 30 brands. Through the acquisition of Erwin Hymer in 2019, the company expanded its geographic footprint and now produces various motorized and towable recreational vehicles for Europe, including motorcaravans, campervans, urban vehicles, caravans, and other RV-related products and services. The company has also begun generating revenue through aftermarket component parts through the acquisition of Airxcel in 2021, however, this is still a nascent part of the business as it accounts for less than 10% of total sales. In fiscal 2023, the company wholesaled 187,015 units and generated over $11.1 billion in revenue.
Thor Industries Inc (THO, Financial) reported consolidated net sales of $2.80 billion for the third quarter of fiscal 2024, surpassing the analyst estimate of $2.73 billion. The company achieved a gross profit margin of 15.1% and net income attributable to Thor Industries Inc (THO) of $114.5 million, translating to diluted earnings per share (EPS) of $2.13, which exceeded the estimated EPS of $1.86.
Performance and Challenges
Thor Industries Inc (THO, Financial) faced a challenging retail environment, with economic pressures impacting retail buyers and elevated floor plan interest rates causing independent dealers to remain cautious with their ordering patterns. Despite these challenges, the company managed to perform relatively well by executing its variable cost model and driving operating efficiencies.
Bob Martin, President and CEO of Thor Industries, commented, “We are proud of our teams’ performance as they have executed our variable cost model and driven operating efficiencies and enabled THOR to perform relatively well in a difficult market. Indicators of the long-term prospects for our industry remain very positive; accordingly, we remain very confident in the long-term outlook for our industry and for THOR.”
Financial Achievements
Thor Industries Inc (THO, Financial) revised its full-year fiscal 2024 guidance to reflect current market conditions. The company now expects consolidated net sales in the range of $9.8 billion to $10.1 billion, a gross margin range of 13.75% to 14.0%, and diluted EPS in the range of $4.50 to $4.75.
Thor Industries Inc (THO, Financial) generated strong cash flow from operations, exceeding $250 million. The company utilized this cash to pay down approximately $161.4 million in debt and repurchase 126,754 shares of its outstanding stock. Capital expenditures for the third fiscal quarter totaled $27.2 million, bringing the nine-month total to just over $106 million.
Segment Results
| Segment | Net Sales (Q3 2024) | Net Sales (Q3 2023) | % Change |
|---|---|---|---|
| North American Towable RVs | $1,071,393 | $1,124,410 | -4.7% |
| North American Motorized RVs | $646,948 | $795,940 | -18.7% |
| European RVs | $931,061 | $866,751 | 7.4% |
North American Towable RV net sales decreased by 4.7% for the third quarter of fiscal 2024 compared to the prior-year period, driven by a 15.1% increase in unit shipments offset by a 19.8% decrease in the overall net price per unit. North American Motorized RV net sales decreased by 18.7%, primarily due to a 20.0% reduction in unit shipments. European RV net sales increased by 7.4%, driven by an 8.9% increase in the overall net price per unit.
Management Commentary
“As anticipated, our third quarter of fiscal year 2024 experienced a similar inflection as compared to our third quarter of fiscal year 2023 as seasonality provided a boost to our top and bottom lines. On a year-over-year basis, our fiscal third quarter saw a consolidated net sales decline of 4.4% while net income before taxes decreased just 20 basis points as a percentage of sales,” said Todd Woelfer, Senior Vice President and Chief Operating Officer.
Thor Industries Inc (THO, Financial) continues to focus on aligning production with retail demand and maintaining operational discipline. The company’s European segment performed well, with net sales increasing by 7.4% and net income before income taxes remaining relatively consistent at 8.3% of net sales.
Outlook
Thor Industries Inc (THO, Financial) remains optimistic about the long-term demand for its products and the global consumer interest in the RV lifestyle. The company’s strong financial position and status as the global leader in the RV industry enable it to meet current market challenges and position itself for future success.
For more detailed information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Thor Industries Inc for further details.
