Thor profit drops amid challenging market conditions
Subscriber Benefit
As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe Now
Elkhart-based Thor Industries Inc. is reporting fiscal third-quarter net income of $121 million, down from $348 million during the same period last year. The recreational vehicle manufacturer said market conditions continue to be challenging, but CEO Bob Martin added the company made significant progress toward improved long-term performance.
Quarterly net sales totaled $2.9 billion, down from $4.7 billion during the same quarter in 2022. Marin said despite dynamics that are currently affecting the company’s operating environment, each of Thor’s segments met or exceeded internal expectations.
“In North America, we continue to prudently manage wholesale production levels given cautious ordering patterns by our independent dealers amid an uncertain market environment,” Marin said. “Given the seasonal step-up in retail demand we experienced as we progressed through the fiscal third quarter, our teams were able to assist independent dealers in destocking approximately 8,300 units from channel inventory and reducing a substantial number of prior-model-year units.”
Martin said consumer demand in Europe remains resilient in many of the geographic markets Thor serves.
The company also began operations at its new Poland manufacturing plant during the fiscal third quarter, which Martin said “will enable us to expand the reach of our product offerings in Europe as production is scaled up over the next 24 to 36 months.”
Thor expects certain macroeconomic conditions to continue in the near-term, which Martin said will force the company to continue its focus on adapting to the economic environment and maintaining operational discipline.
“Combined, our efforts to move model year 2022 units through the retail cycle and our disciplined production of model year 2023 units to lower overall channel inventory levels position us well for the model year 2024 rollout,” he said. “While we anticipate these efforts will result in sequentially lower fiscal fourth quarter financial results, we believe these strategies will bolster our relative performance next fiscal year.”
You can connect to the full earnings report by clicking here.