Thor full-year profit drops amid economic challenges
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Elkhart-based Thor Industries Inc. is reporting fiscal full-year net income of $374 million, down from a record $1.1 billion the previous year. CEO Bob Martin said the drop was primarily due to changing market conditions caused by high interest rates and rising inflation, among other challenges.
The recreational vehicle manufacturer said Monday net sales for the fiscal year dropped nearly 32% to $11 billion. The decrease is attributed to lower current dealer and consumer demand.
“Fiscal 2023 presented a series of challenges as a result of higher interest rates, rising inflation, increased economic uncertainty, ongoing supply chain constraints and geopolitical issues,” Martin said. “At the same time, it highlighted the strength of our experienced operating management teams and proven business model.”
Thor’s North American Towable RVs segment saw the biggest sales decline of 51.5%. However, the company’s European RVs segment actually saw a 5.2% increase to $3 billion.
“These record results reflect the benefits of pricing actions previously taken to offset material and other input costs, improvements in chassis supply necessary to further restock dealer inventory levels of motorized products as well as operational efficiencies,” said Chief Operating Officer Todd Woelfer. “We are extremely pleased with the continued efforts of our European team to strengthen the segment’s operations and profitability.”
Martin said the company’s operational performance in the second half of the fiscal year has provided a “solid foundation.”
“As we demonstrated in fiscal 2023, we will continue to take a very disciplined approach to production planning while employing our variable cost model to prioritize profitability in the coming fiscal year,” he said.
Woelfer added the company continues to be optimistic about the growth trajectory of the RV industry.
Thor’s earnings report was released after the closing bell on Monday. The company’s stock closed up 2% at $94.82 per share.
You can view the full earnings report by clicking here.