Back to GetFilings.com



SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)
 
x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  
 
For the quarterly period ended                      February 28, 2004                     
 
OR
 
o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  
 
For the transition period from _______________________ to _____________________

Commission file number   1-6403




WINNEBAGO INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
 
IOWA   42-0802678  
(State or other jurisdiction of  (I.R.S. Employer 
incorporation or organization)  Identification No.) 
 
P. O. Box 152, Forest City, Iowa   50436  
(Address of principal executive offices)  (Zip Code) 

Registrant’s telephone number, including area code: (641) 585-3535

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes     X      No          .

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
Yes     X      No          .

There were 34,020,387 shares of $.50 par value common stock outstanding on April 7, 2004.


 


WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES

INDEX TO REPORT ON FORM 10-Q

Page Number
PART I.   FINANCIAL INFORMATION:      

Item 1.		  Unaudited Consolidated Balance Sheets  1 – 2 

 		  Unaudited Consolidated Statements of Income  3 

 		  Unaudited Condensed Consolidated Statements of Cash Flows  4 

 		  Unaudited Condensed Notes to Consolidated Financial Statements  5 – 10 

Item 2.		  Management’s Discussion and Analysis of Financial Condition  11 – 17 

Item 3.		  Quantitative and Qualitative Disclosures About Market Risk  16 

Item 4.		  Controls and Procedures  17 

 		  Independent Accountants’ Report  18 

PART II.		  OTHER INFORMATION:  19 – 22 

Item 1.		  Legal Proceedings  19 

Item 4.		  Submission of Matters to a Vote of Security Holders  19 – 20 

Item 6.		  Exhibits and Reports on Form 8-K  20 

 


PART I   Financial Information
Item 1.

WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS

Dollars in thousands, except par value
ASSETS
February 28,
2004
August 30,
2003


CURRENT ASSETS		            
Cash and cash equivalents   $ 56,716   $ 99,381  
Receivables, less allowance for doubtful  
   accounts ($136 and $134, respectively)    41,165    30,885  
Inventories    137,383    114,282  
Prepaid expenses and other assets    4,528    4,816  
Deferred income taxes    9,499    7,925  

     Total current assets		    249,291    257,289  

PROPERTY AND EQUIPMENT, at cost		  
Land    1,000    999  
Buildings    56,455    55,158  
Machinery and equipment    97,106    94,208  
Transportation equipment    9,217    9,218  
     163,778    159,583  
     Less accumulated depreciation    100,366    96,265  

     Total property and equipment, net		    63,412    63,318  

DEFERRED INCOME TAXES		    23,165    22,491  

INVESTMENT IN LIFE INSURANCE		    22,421    22,794  

OTHER ASSETS		    12,891    11,570  

TOTAL ASSETS 		   $ 371,180   $ 377,462  

See Unaudited Condensed Notes to Consolidated Financial Statements.






1


WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS

Dollars in thousands, except par value
LIABILITIES AND STOCKHOLDERS’ EQUITY
February 28,
2004
August 30,
2003


CURRENT LIABILITIES		            
Accounts payable, trade   $ 50,598   $ 52,239  
Income tax payable    6,060    —  
Accrued expenses  
     Accrued compensation    16,636    15,749  
     Product warranties    11,890    9,755  
     Promotional    11,345    4,599  
     Insurance    5,320    5,087  
     Other    7,177    4,969  

        Total current liabilities		    109,026    92,398  

POSTRETIREMENT HEALTH CARE AND DEFERRED		  
   COMPENSATION BENEFITS    78,523    74,438  

STOCKHOLDERS’ EQUITY		  
Capital stock, common, par value $.50; authorized  
   60,000,000 shares: issued 51,776,000 shares    25,888    25,888  
Additional paid-in capital    14,639    13,025  
Reinvested earnings    361,469    331,039  
     401,996    369,952  
Less treasury stock, at cost    218,365    159,326  

Total stockholders’ equity		    183,631    210,626  

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 		   $ 371,180   $ 377,462  

See Unaudited Condensed Notes to Consolidated Financial Statements.


2


WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

In thousands, except per share data
Thirteen Weeks Ended
 Twenty-Six Weeks Ended
February 28,
2004
March 1,
2003
February 28,
2004
March 1,
2003
Net revenues     $ 266,033   $ 185,958   $ 520,966   $ 419,305  
Cost of goods sold    231,004    159,590    446,472    357,865  
     Gross profit    35,029    26,368    74,494    61,440  
Operating expenses  
     Selling    4,461    4,068    9,022    8,755  
     General and administrative    6,039    2,932    11,777    8,036  
     Total operating expenses    10,500    7,000    20,799    16,791  

Operating income		    24,529    19,368    53,695    44,649  

Financial income		    283    420    586    695  

Income before income taxes		    24,812    19,788    54,281    45,344  

Provision for taxes		    8,932    7,898    20,334    17,576  

Income from continuing operations		    15,880    11,890    33,947    27,768  

Income from discontinued operations (net of taxes)		    —    419    —    819  

Net income		   $ 15,880   $ 12,309   $ 33,947   $ 28,587  

Income per share – basic (Note 10) 		  

   From continuing operations		   $ .47   $ .32   $ .98   $ .74  
   From discontinued operations    —    .01    —    .02  
Net income   $ .47   $ .33   $ .98   $ .76  

Income per share – diluted (Note 10) 		  

   From continuing operations		   $ .46   $ .31   $ .96   $ .73  
   From discontinued operations    —    .01    —    .02  
Net income   $ .46   $ .32   $ .96   $ .75  

Weighted average shares of common stock		  
   outstanding  
      Basic    33,928    37,550    34,613    37,500  

      Diluted		    34,545    38,224    35,196    38,226  

On January 14, 2004, the Company’s Board of Directors declared a two-for-one stock split effected in the form of a 100% stock dividend on March 5, 2004 to shareholders of record as of February 20, 2004. All share and per share amounts have been restated to give retroactive effect to the stock split.

See Unaudited Condensed Notes to Consolidated Financial Statements.


3


WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Dollars in thousands
Twenty-Six Weeks Ended
February 28,
2004
March 1,
2003
Cash flows from operating activities            
  Net income   $ 33,947   $ 28,587  
  Income from discontinued operations    —    (819 )
  Income from continuing operations    33,947    27,768  
Adjustments to reconcile net income to net cash provided by  
  operating activities  
  Depreciation and amortization    4,759    4,017  
  Tax benefit of stock options    2,328    867  
  Other    504    389  
Change in assets and liabilities  
  (Increase) decrease in receivable and other assets    (11,446 )  10,479  
  Increase in inventories    (23,101 )  (13,751 )
  Increase in deferred income taxes    (2,248 )  (1,412 )
  Increase (decrease) in accounts payable and accrued expenses    10,568    (1,604 )
  Increase in income taxes payable    7,485    1,737  
  Increase in postretirement benefits    2,891    2,343  
  Net cash provided by continuing operations    25,687    30,833  
  Net cash provided by discontinued operations    —    8  
Net cash provided by operating activities    25,687    30,841  

Cash flows used in investing activities		  
  Purchases of property and equipment    (4,967 )  (17,559 )
  Other    (115 )  (1,458 )
  Net cash used in continuing operations    (5,082 )  (19,017 )
  Net cash used in discontinued operations    —    (4,255 )
Net cash used in investing activities    (5,082 )  (23,272 )

Cash flows used in financing activities and capital transactions		  
  Payments for purchase of common stock    (63,979 )  (10,521 )
  Payment of cash dividends    (3,517 )  (1,887 )
  Proceeds from issuance of common and treasury stock    4,226    2,121  
Net cash used in financing activities and  
  capital transactions    (63,270 )  (10,287 )
Net decrease in cash and cash equivalents    (42,665 )  (2,718 )

Cash and cash equivalents – beginning of period		    99,381    42,225  

Cash and cash equivalents – end of period		   $ 56,716   $ 39,507  

See Unaudited Condensed Notes to Consolidated Financial Statements.


4


WINNEBAGO INDUSTRIES, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS

NOTE 1:   Basis of Presentation

  In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments, consisting of normal recurring accruals, necessary to present fairly the consolidated financial position as of February 28, 2004, the consolidated results of operations for the 13 and 26 weeks ended February 28, 2004 and March 1, 2003 and the consolidated cash flows for the 26 weeks ended February 28, 2004 and March 1, 2003. The statement of income for the 26 weeks ended February 28, 2004, is not necessarily indicative of the results to be expected for the full year. The balance sheet data as of August 30, 2003 was derived from audited financial statements, but does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These interim consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto appearing in the Company’s Annual Report to Shareholders for the year ended August 30, 2003.

  Certain prior year balances have been reclassified to conform to the current year presentation. These reclassifications had no impact on previously reported net income or shareholders’ equity. All share and per share amounts have been restated to give retroactive effect to the stock split.

  Accounting for Stock-Based Compensation. The Company adopted SFAS No. 123, Accounting for Stock-Based Compensation in fiscal 1997. The Company has elected to continue following the accounting guidance of Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees for measurement and recognition of stock-based transactions with employees. No compensation cost has been recognized for options issued under the stock option plans because the exercise price of all options granted was not less than 100 percent of fair market value of the common stock on the date of grant. Had compensation cost for the stock options issued been determined based on the fair value at the grant date, consistent with provisions of SFAS No. 123, income and income per share for the 13 and 26 weeks ended February 28, 2004 and March 1, 2003 would have been changed to the proforma amounts indicated as follows:

Thirteen Weeks Ended
Twenty-Six Weeks Ended
February 28,
2004
March 1,
2003
February 28,
2004
March 1,
2003
In thousands, except per-share amounts