Thor Industries cited an improving wholesale shipment share and strong growth in net sales within the company’s Q1 financial earnings released today.
Thor’s first quarter included a 17.5 percent increase in net sales at $2.54 billion. North American RV net sale results showed $1.89 billion. First-quarter profits increased 112.8 percent to $113.8 million.
“We are pleased to report a solid start to our fiscal year with strong year-over-year growth across all of our major metrics,” President and CEO Bob Martin stated.
Thor reported a record RV backlog which increased 194.5 percent from a year earlier.
Regarding Thor’s North American market share, a question-and-answer document released by the company stated the company gained wholesale shipment share since the Covid pandemic began. It also said wholesale shipments were a better market measure currently than retail sales.
“Given that current demand exceeds supply in the market and many state motor vehicle departments are behind in registering new RVs, we believe recent retail share indicators are not as meaningful as usual,” the report stated. “Wholesale shipment share, as a percent of total wholesale shipments, is currently a more accurate proxy for market share growth.”
Motorized segment wholesale shipment share increased to 43.4 percent in the first quarter, up from 38.7 percent the previous quarter. Towables are at 43.6 percent, up from 43.2 percent in the fourth quarter.
Thor noted it was expanding production capacity to ensure further gains in wholesale shipment share. The company stated that since restarting production, it added production lines and retrofitted existing lines within Thor’s plants.
“We will continue to bring additional capacity online in our second and third quarters of fiscal 2021, with modest capital investments, and expect to see continued shipment share gains as we further accelerate production throughput,” Thor stated. “We believe prudent production management is critical in our cyclical industry. Overproducing leads to excess finished goods inventory and increased discounting and promotions, which may temporarily increase share, but would also negatively impact the manufacturers’ gross margin.”
Looking ahead, Thor expects wholesale shipment share growth to continue in fiscal 2021. The company cited RVIA’s latest forecast, expecting an 18.7 percent increase in 2021 shipments.
“We support their forecast and believe there is potential for upside to this forecast based on current industry conditions,” Thor stated.
Thor noted fiscal 2021 capital expenditures primarily will be to complete building projects, and replace and upgrade machinery, equipment and other facility assets.
In the Environmental, Social and Governance (ESG) realm, Thor stated the company made significant strides.
In the early first 2021 fiscal quarter, the company hired Chandria Harris as Thor’s chief people and inclusion consultant, responsible for overseeing the company’s inclusion strategies. William J. Kelley, Jr., was added to the Board of Directors in early November.
“With more than 30 years of executive-level experience, he brings corporate governance and risk oversight expertise, as well as board refreshment and diversity,” Thor stated.
Additionally, Thor released its fiscal year 2020 sustainability report to push efforts in improved inclusion strategies, board diversity and advancing ESG efforts for long-term positive impacts on business, shareholders and the broader community, Thor stated.
