CORRECTING and REPLACING -- Cavco Industries Reports Fiscal 2018 Fourth Quarter and Year End Results
29 Mai 2018 - 10:55PM
In a release issued earlier today under the same headline
by Cavco Industries, Inc. (Nasdaq:CVCO), please note the
conference call time should be May 30, 2018 at 11:00 AM Eastern
Time rather than 1:00 PM Eastern Time as originally
issued. The corrected release follows:
Cavco Industries Reports Fiscal 2018 Fourth Quarter and
Year End Results
Cavco Industries, Inc. (Nasdaq:CVCO) today
announced financial results for the fourth quarter and fiscal year
ended March 31, 2018. On April 3, 2017, the Company completed the
acquisition of Lexington Homes, Inc., which operates a manufactured
housing plant in Lexington, Mississippi. Since the acquisition
date, the results from this new business are included in Cavco's
consolidated financial statements presented herein.
Three months ended March 31, 2018
compared to the three months ended April 1, 2017
- Net revenue was $242.5 million, up 22.5% from
$198.0 million. The increase was the result of higher home prices
and sales volume. The Company recognized $14.8 million of home
sales revenue and $1.8 million of income from operations from early
commercial loan payoffs received under Cavco's wholesale lending
programs. This revenue was previously deferred in prior periods in
the normal course of business.
- Income before income taxes was $30.7 million,
an 86.1% increase over $16.5 million. Current quarter results
include $4.5 million of other income from gains realized in the
sale of corporate investments.
- Income tax expense was $8.6 million, resulting
in an effective tax rate of 27.9% compared to $5.6 million and an
effective tax rate of 33.9%.
- Net income was $22.1 million compared to $10.9
million, a 102.8% increase.
- Net income per share, based on basic and
diluted weighted average shares outstanding, was $2.45 and $2.40,
respectively, versus $1.21 and $1.19, respectively.
Twelve months ended March 31, 2018
compared to the twelve months ended April 1, 2017
- Net revenue was $871.2 million, 12.6% higher
than $773.8 million. The increase was primarily from a
larger proportion of higher priced homes sold and
improved home sales volume.
- Income before income taxes increased 42.0% to
$78.5 million as compared to $55.3 million. In addition to the
investment gain described above, the improvement was from increased
home sales volume and pricing, a $3.4 million favorable dispute
settlement resolution in the third fiscal quarter and improved
earnings in the financial services segment.
- Income tax expense was $17.0 million, creating
an effective tax rate of 21.7% compared to income tax expense of
$17.3 million and an effective rate of 31.3%. The current fiscal
year benefited from the Tax Cuts and Jobs Act, which made broad and
complex changes to the U.S. tax code. In connection with lower
federal income tax liability related to the Tax Act and requisite
revaluation of the net deferred income tax balance, the Company
recorded a net income tax benefit of $4.8 million (or
$0.52 per diluted share). Additionally, the Company recognized
benefits of $2.1 million (or $0.23 per diluted share) from the
current year adoption of accounting standards that required excess
tax benefits on stock option exercises to be recorded as a
reduction of income tax expense instead of equity as was previously
required.
- Net income was $61.5 million, up 61.8% from
net income of $38.0 million.
- Net income per share, based on basic and
diluted weighted average shares outstanding, was $6.82 and $6.68,
respectively, versus basic and diluted net income per share of
$4.23 and $4.17, respectively.
Commenting on the results, Joseph Stegmayer,
Chairman, President and Chief Executive Officer said, "We were
pleased to complete the fiscal year with improved income from
operations and growth in product sales. Fourth quarter gross profit
as a percentage of revenue improved from home sales prices
gradually increasing throughout the year to address rapidly rising
material and labor input costs. Still, we work to keep prices
competitive and affordable through efficient factory production
processes and cost controls. We are also focused on improving
production workforce size and productivity to raise home building
levels further."
Mr. Stegmayer continued, "Fiscal year 2019
begins with optimism about demand for housing as home ownership
rates, currently at a low 64.2%, are reported to be trending
higher. With housing prices and rental rates also on the rise, we
believe systems-built housing will be an increasingly sought after
option for affordable living."
Cavco’s management will hold a conference call
to review these results tomorrow, May 30, 2018, at 11:00 AM
(Eastern Time). Interested parties can access a live webcast of the
conference call on the Internet at www.cavco.com under the Investor
Relations link. An archive of the webcast and presentation will be
available for 90 days at www.cavco.com under the Investor Relations
link.
Cavco Industries, Inc., headquartered in
Phoenix, Arizona, designs and produces factory-built housing
products primarily distributed through a network of independent and
Company-owned retailers. The Company is one of the largest
producers of manufactured homes in the United States, based on
reported wholesale shipments, marketed under a variety of brand
names including Cavco Homes, Fleetwood Homes, Palm Harbor Homes,
Fairmont Homes, Friendship Homes, Chariot Eagle and Lexington
Homes. The Company is also a leading producer of park model RVs,
vacation cabins, and systems-built commercial structures, as well
as modular homes built primarily under the Nationwide Homes brand.
Cavco’s mortgage subsidiary, CountryPlace Mortgage, is an approved
Fannie Mae and Freddie Mac seller/servicer, a Ginnie Mae
mortgage-backed securities issuer that offers conforming mortgages,
non-conforming mortgages and home-only loans to purchasers of
factory-built homes. Our insurance subsidiary, Standard Casualty,
provides property and casualty insurance to owners of manufactured
homes.
Certain statements contained in this release are
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, Section 21E of the Securities and Exchange
Act of 1934 and the Private Securities Litigation Reform Act of
1995. In general, all statements that are not historical in nature
are forward-looking. Forward-looking statements are typically
included, for example, in discussions regarding the manufactured
housing and site-built housing industries; our financial
performance and operating results; and the expected effect of
certain risks and uncertainties on our business, financial
condition and results of operations. All forward-looking statements
are subject to risks and uncertainties, many of which are beyond
our control. As a result, our actual results or performance may
differ materially from anticipated results or performance. Factors
that could cause such differences to occur include, but are not
limited to: adverse industry conditions; our ability to
successfully integrate past acquisitions, including the recent
acquisition of Lexington Homes, and any future acquisition or the
ability to attain the anticipated benefits of such acquisitions;
the risk that any past or future acquisition may adversely impact
our liquidity; involvement in vertically integrated lines of
business, including manufactured housing consumer finance,
commercial finance and insurance; a constrained consumer financing
market; curtailment of available financing for retailers in the
manufactured housing industry; our participation in certain
wholesale and retail financing programs for the purchase of our
products by industry distributors and consumers may expose us to
additional risk of credit loss; significant warranty and
construction defect claims; our contingent repurchase
obligations related to wholesale financing; market forces and
housing demand fluctuations; net losses were incurred in certain
prior periods and there can be no assurance that we will generate
income in the future; a write-off of all or part of our goodwill;
the cyclical and seasonal nature of our business; limitations on
our ability to raise capital; competition; our ability to maintain
relationships with independent distributors; our business and
operations being concentrated in certain geographic regions; labor
shortages; pricing and availability of raw materials; unfavorable
zoning ordinances; loss of any of our executive officers;
organizational document provisions delaying or making a change in
control more difficult; volatility of stock price; general
deterioration in economic conditions and continued turmoil in the
credit markets; increased costs of healthcare benefits for
employees; governmental and regulatory disruption; information
technology failures and data security breaches; extensive
regulation affecting manufactured housing; together with all of the
other risks described in our filings with the Securities and
Exchange Commission. Readers are specifically referred to the Risk
Factors described in Item 1A of the 2017 Form 10-K, as may be
amended from time to time, which identify important risks that
could cause actual results to differ from those contained in the
forward-looking statements. Cavco expressly disclaims any
obligation to update any forward-looking statements contained in
this release, whether as a result of new information, future events
or otherwise. Investors should not place any reliance on any such
forward-looking statements.
CAVCO INDUSTRIES,
INC.CONSOLIDATED BALANCE SHEETS(Dollars
in thousands, except per share amounts)
|
March 31,2018 |
|
April 1,2017 |
ASSETS |
(Unaudited) |
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
186,766 |
|
|
$ |
132,542 |
|
Restricted cash, current |
11,228 |
|
|
11,573 |
|
Accounts
receivable, net |
35,043 |
|
|
29,448 |
|
Short-term investments |
11,866 |
|
|
11,289 |
|
Current
portion of consumer loans receivable, net |
31,096 |
|
|
31,115 |
|
Current
portion of commercial loans receivable, net |
5,481 |
|
|
7,932 |
|
Inventories |
109,152 |
|
|
93,855 |
|
Prepaid
expenses and other current assets |
27,961 |
|
|
29,806 |
|
Deferred
income taxes, current |
— |
|
|
9,204 |
|
Total current
assets |
418,593 |
|
|
356,764 |
|
Restricted cash |
1,264 |
|
|
724 |
|
Investments |
33,573 |
|
|
30,256 |
|
Consumer loans
receivable, net |
63,855 |
|
|
64,686 |
|
Commercial loans
receivable, net |
11,120 |
|
|
17,901 |
|
Property, plant and
equipment, net |
63,355 |
|
|
56,964 |
|
Goodwill and other
intangibles, net |
83,020 |
|
|
80,021 |
|
Total assets |
$ |
674,780 |
|
|
$ |
607,316 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable |
$ |
23,785 |
|
|
$ |
24,010 |
|
Accrued
liabilities |
126,500 |
|
|
109,789 |
|
Current
portion of securitized financings and other |
26,044 |
|
|
6,417 |
|
Total current
liabilities |
176,329 |
|
|
140,216 |
|
Securitized financings
and other |
33,768 |
|
|
51,574 |
|
Deferred income
taxes |
7,577 |
|
|
21,118 |
|
Stockholders’
equity: |
|
|
|
Preferred
stock, $.01 par value; 1,000,000 shares authorized; No shares
issued or outstanding |
— |
|
|
— |
|
Common
stock, $.01 par value; 40,000,000 shares authorized; Outstanding
9,044,858 and 8,994,968 shares, respectively |
90 |
|
|
90 |
|
Additional paid-in capital |
246,197 |
|
|
244,791 |
|
Retained
earnings |
209,381 |
|
|
148,141 |
|
Accumulated other comprehensive income |
1,438 |
|
|
1,386 |
|
Total stockholders’
equity |
457,106 |
|
|
394,408 |
|
Total liabilities and
stockholders’ equity |
$ |
674,780 |
|
|
$ |
607,316 |
|
CAVCO INDUSTRIES,
INC.CONSOLIDATED STATEMENTS OF
INCOME(Dollars in thousands, except per share
amounts)(Unaudited)
|
Three Months Ended |
|
Year Ended |
|
March 31,2018 |
|
April 1,2017 |
|
March 31,2018 |
|
April 1,2017 |
Net revenue |
$ |
242,529 |
|
|
$ |
197,998 |
|
|
$ |
871,235 |
|
|
$ |
773,797 |
|
Cost of sales |
188,225 |
|
|
155,864 |
|
|
690,555 |
|
|
615,760 |
|
Gross profit |
54,304 |
|
|
42,134 |
|
|
180,680 |
|
|
158,037 |
|
Selling, general and
administrative expenses |
28,404 |
|
|
25,112 |
|
|
106,907 |
|
|
101,231 |
|
Income from
operations |
25,900 |
|
|
17,022 |
|
|
73,773 |
|
|
56,806 |
|
Interest expense |
(1,092 |
) |
|
(1,059 |
) |
|
(4,397 |
) |
|
(4,443 |
) |
Other income, net |
5,896 |
|
|
511 |
|
|
9,147 |
|
|
2,918 |
|
Income before income
taxes |
30,704 |
|
|
16,474 |
|
|
78,523 |
|
|
55,281 |
|
Income tax expense |
(8,564 |
) |
|
(5,586 |
) |
|
(17,021 |
) |
|
(17,326 |
) |
Net income |
$ |
22,140 |
|
|
$ |
10,888 |
|
|
$ |
61,502 |
|
|
$ |
37,955 |
|
|
|
|
|
|
|
|
|
Net income per
share: |
|
|
|
|
|
|
|
Basic |
$ |
2.45 |
|
|
$ |
1.21 |
|
|
$ |
6.82 |
|
|
$ |
4.23 |
|
Diluted |
$ |
2.40 |
|
|
$ |
1.19 |
|
|
$ |
6.68 |
|
|
$ |
4.17 |
|
Weighted average shares
outstanding: |
|
|
|
|
|
|
|
Basic |
9,039,815 |
|
|
8,994,233 |
|
|
9,024,437 |
|
|
8,976,064 |
|
Diluted |
9,240,296 |
|
|
9,122,235 |
|
|
9,201,706 |
|
|
9,105,743 |
|
CAVCO INDUSTRIES,
INC.OTHER OPERATING DATA(Dollars in
thousands)(Unaudited)
|
Three Months Ended |
|
Year Ended |
|
March 31,2018 |
|
April 1,2017 |
|
March 31,2018 |
|
April 1,2017 |
Net revenue: |
|
|
|
|
|
|
|
Factory-built housing |
$ |
228,074 |
|
|
$ |
184,458 |
|
|
$ |
815,519 |
|
|
$ |
720,971 |
|
Financial
services |
14,455 |
|
|
13,540 |
|
|
55,716 |
|
|
52,826 |
|
Total net revenue |
$ |
242,529 |
|
|
$ |
197,998 |
|
|
$ |
871,235 |
|
|
$ |
773,797 |
|
|
|
|
|
|
|
|
|
Capital
expenditures |
$ |
5,361 |
|
|
$ |
952 |
|
|
$ |
8,386 |
|
|
$ |
5,295 |
|
Depreciation |
$ |
959 |
|
|
$ |
833 |
|
|
$ |
3,658 |
|
|
$ |
3,319 |
|
Amortization of other
intangibles |
$ |
92 |
|
|
$ |
92 |
|
|
$ |
368 |
|
|
$ |
368 |
|
|
|
|
|
|
|
|
|
Total factory-built
homes sold |
4,063 |
|
|
3,697 |
|
|
14,537 |
|
|
13,820 |
|
For additional information, contact:
Dan UrnessCFO and
Treasurerdanu@cavco.comPhone:
602-256-6263On the Internet: www.cavco.com
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