Thor Industries (NYSE: THO), a leading manufacturer of recreational vehicles, reported third-quarter net income of 59 cents per share, compared to $2.53 per share during the year-over period. The Q3 earnings include EHG acquisition-related costs of around $1.06 per share.
Excluding these costs, the company narrowly surpassed analysts’ expectation for the quarter.
Revenues gained 11% year-over-year to $2.51 billion, helped by a more stable sales environment in North America. However, this fell short of the street consensus of $2.63 billion, sending the stock down over 1% during pre-market trading.
Lower unit volume hurt sales in both the North American Towable RV as well as the North American Motorized RV segment. North American Towable RV sales fell to $1.24 billion from $1.61 billion in the prior-year period, while North American Motorized RV sales were $459.2 million, down from $598.5 million a year ago.
CEO Bob Martin said, “EHG made a significant contribution to our top-line results for the quarter, and as we move through some of the transitional costs, we look forward to EHG’s meaningful contribution to our bottom line as well.”
After falling to a multi-year low in December last year, shares of the Elkhart, Indiana-based firm showed signs of a recovery in early 2019. However, it pared the early gains as the year progressed. The stock lost about 47% in the past twelve months.
In what could be the warnings of a slowdown, the company in its recent statements hinted at cutting production to rein in the inventory imbalance. However, it is estimated that the dip in dealer demand will be short-lived. Thor’s solid production capacity, which got a boost after the acquisition of Jayco a few years ago, contributes to the inventory backlog.