Thor Industries, Inc. · NYSE:THO
Thor Industries — Q1 FY2018 Earnings Presentation
34 slides from Thor Industries's earnings presentation, Nov 27, 2017
Slide 1: Investor Presentation November 27, 2017
www.thorindustries.com INVESTOR PRESENTATION NOVEMBER 27, 2017 www.thorindustries.com
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation includes certain statements that are “forward looking” statements within the meaning of the U . S . Private Securities Litigation Reform Act of 1995 , Section 27 A of the Securities Act of 1933 , as amended, and Section 21 E of the Securities Exchange Act
Slide 3: Thor Operating Entities
Thor Operating Entities | | | | (VAIRSTREAM 3S NG ue THOR ZA'S, J LQ ome | Cums SB STARCRAFT .&” S “ ‘DG, = a Been: waa THOR |'NDUsTRIES 3
Slide 4: Table of Contents
Table of Contents Overview and Current Industry Conditions 5 First Quarter 2018 Update 16 Appendix: Financial & Market Data 23 4
Slide 5: Overview and Current Industry Conditions
5 Overview and Current Industry Conditions
Slide 6: Thor – Strong Investment Appeal
Thor – Strong Investment Appeal » Solid growth company throughout its 37 - year history – 27.9% compounded annual five - year EPS growth* o Balance of organic growth and accretive acquisitions » Market leader in a growing industry – Recreational Vehicle (RV) shipments projected to grow 11.4% in cale
Slide 7: Solid Economic Fundamentals Support Continued RV Industry Growth
Solid Economic Fundamentals Support Continued RV Industry Growth 7 Continued Favorable Macro Environment » High consumer confidence » Favorable employment and wage trends » Continued gains in household wealth » Historically low interest rates » Wide credit availability for both wholesale and retail
Slide 8: Consumer Trends Support Continued RV Industry Growth
Consumer Trends Support Continued RV Industry Growth 8 THE OPPORTUNITY : If an additional 1% of potential first - time buyers interested in new RVs enter the RV lifestyle, that represents the potential for an additional 166,000 units in an industry that is projected to produce 479,700 units** in cal
Slide 9: Trends Driving Growth: Demographics
Trends Driving Growth: Demographics 9 » + 3.4 MILLION new households have started camping since 2014 * » Gen X and Millennials made up 72 % of campers in 2016 * » Younger campers looking for affordable recreation experiences » Interested in trying different accommodations, including RVs » Latino, Af
Slide 10: Trends Driving Growth: Lifestyle
Trends Driving Growth: Lifestyle 10 Recreational sports » $ 887 billion spent on “outdoor recreation” in 2016* » Trend toward getting more active and leading a healthier lifestyle » Growing use of RVs with youth sports leagues and tournaments Camping » In 2016, 37.1 million U.S. households camped at
Slide 11: Trends Driving Growth: Affordability, Flexibility & Convenience
Trends Driving Growth: Affordability, Flexibility & Convenience 11 * Source : RVIA 2016 Industry Profile Benefits of RV Travel » RV vacations offer greater savings over those taken using a personal car or airline, staying in a hotel or rental home, and eating in restaurants, regardless of duration,
Slide 12: Health of the RV Channel
Health of the RV Channel 12 Dealer Inventory Levels: » Overall dealer inventory levels remain healthy » Total days in inventory at dealers are stable » Average age of RV inventory on dealer lots remains low » Used inventory levels remain low, supporting trade - in values and demand for new RVs Whole
Slide 13: Opportunities for Continued Growth – Product Innovations & Manufacturing
Opportunities for Continued Growth – Product Innovations & Manufacturing 13 Growth Levers » Continuous investments in new products, features and floorplans ◦ Short product development cycle enables us to introduce new models every year, reinforcing the consumer trade - in cycle » Organic growth thro
Slide 14: Opportunities for Continued Growth – Further Market Penetration
Opportunities for Continued Growth – Further Market Penetration 14 Growth Levers » Expanded Thor marketing efforts ◦ M arketing to younger families and more diverse consumer segments ◦ Go Your Own Way™ Campaign launched September 2017 » Geographic expansion ◦ Recent new and expanded campuses added o
Slide 15: 2017 Dealer Open House
2017 Dealer Open House » We hosted our 8 th annual Dealer Open House September 18 - 21, 2017, in Elkhart, Indiana. Show highlights included: ◦ Record attendance ◦ Record orders ◦ Dealers highly optimistic regarding remainder of 2017 and calendar 2018 ◦ Numerous product introductions or redesigns wit
Slide 16: First Quarter 2018 Update
First Quarter 2018 Update THIOR | INDUSTR
Slide 17: First Quarter Key Messages
First Quarter Key Messages 17 Strategic Execution Robust Consumer Demand Outlook » All - time record quarterly revenues and profit » Double - digit sales growth in both segments – towables (+33.7%) and motorized (+22.8%) » Execution of our strategic plan » Capacity expansions » Q1 year - over - year
Slide 18: First Quarter 2018 Results Up Double Digits
First Quarter 2018 Results Up Double Digits 18 » All - time record quarterly sales and net income » Gross profit up, primarily attributable to the increase in sales, and also operating efficiencies attained in the past year, primarily by Jayco » New consumers continuing to embrace the benefits of RV
Slide 19: First Quarter 2018 – Towables
First Quarter 2018 – Towables 19 Towable Segment » Continued mix shift toward more affordably - priced travel trailers » Market share continued to improve through September 2017, with U.S. Towable share increasing from 48.1% to 48.9 %, while Canadian Towable share remained stable at 55.4%* » Demand
Slide 20: First Quarter 2018 – Motorized
First Quarter 2018 - Motorized 20 Motorized Segment » Continued mix shift toward more affordably - priced Class C and gas Class A motorhomes » Market share momentum continued through September 2017, with U.S. Class A and C market share increasing from 37.5% to 41.7% and Canadian Class A and C market
Slide 21: Key Stats – Q1
$78.7 $128.4 1Q17 1Q18 Net Income ( $ millions) $1,708.5 $2,231.7 1Q17 1Q18 Net Sales ( $ millions) Key Stats – Q1 (As of or For the Quarters Ended October 31) 21 $1.49 $2.43 1Q17 1Q18 Diluted EPS 13.9% 14.9% 1Q17 1Q18 Gross Margin Income Statement Balance Sheet & Working Capital $223.3 $151.5 FY17*
Slide 22: Historical Key Stats
$111.4 $151.7 $175.5 $202.0 $258.0 $374.3 FY12 FY13 FY14 FY15 FY16 FY17 Net Income (Continuing Ops., $ millions) $2,640 $3,242 $3,525 $4,007 $4,582 $7,247 FY12 FY13 FY14 FY15 FY16 FY17 Net Sales (Continuing Ops., $ millions) Historical Key Stats (As of or For the Fiscal Years Ended July 31) 22 $2.07
Slide 23: Appendix: Financial & Market Data
Appendix: Financial & Market Data 23
Slide 24: Thor's RV Product Range
Thor’s RV Product Range 24 Towable Segment Motorized Segment Class B van motorhomes; retail price $150,000 - $250,000 Class C living area built on van or pickup chassis; retail price $50,000 - $250,000 Class A fully enclosed, bus - style motorhome; retail price $70,000 - $700,000 Travel Trailers hit
Slide 25: Seasonal Shipment Patterns
Seasonal Shipment Patterns 25 0 10,000 20,000 30,000 40,000 50,000 60,000 Units Retail * Wholesale ** * Source: Statistical Surveys, Inc., U.S. and Canada ** Source: Recreation Vehicle Industry Association
Slide 26: RV Wholesale Market Trends
RV Wholesale Market Trends (Units 000s) 26 106.9 133.6 140.6 196.6 215.7 186.9 189.9 211.7 215.8 187.9 173.1 163.1 203.4 227.8 259.5 247.2 247.5 254.5 292.7 321.2 300.1 256.8 311.0 320.8 370.1 384.4 390.5 353.5 237.0 165.6 242.3 252.3 285.8 321.1 356.8 374.2 430.7 479.7 491.2 1980 1981 1982 1983 198
Slide 27: RV Wholesale Market Towable Trends
RV Wholesale Market Towable Trends (Units 000s) 27 78.4 98.1 99.4 127.1 133.7 118.1 122.1 137.9 142.9 126.7 120.8 121.1 156.5 176.5 201.3 194.3 192.2 199.5 229.1 249.6 239.1 207.6 250.6 258.9 298.3 323.0 334.5 298.1 208.6 152.4 217.1 227.5 257.6 282.7 312.8 326.9 376.0 419.5 429.3 1980 1981 1982 198
Slide 28: RV Wholesale Market Motorized Trends
RV Wholesale Market Motorized Trends (Units 000s) 28 28.5 35.4 41.2 69.5 82.0 68.7 67.7 73.7 72.8 61.1 52.3 41.9 46.9 51.3 58.2 52.8 55.3 55.1 63.5 71.5 61.0 49.2 60.4 62.0 71.7 61.4 55.8 55.4 28.4 13.2 25.2 24.8 28.2 38.4 44.0 47.3 54.7 60.2 61.9 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 19
Slide 29: Consumer Confidence
Consumer Confidence 29 Historical Data : The Conference Board, Consumer Confidence Survey ® 0 20 40 60 80 100 120 140
Slide 30: RV Industry Demand
RV Industry Demand » Industry retail demand has shifted toward lighter - weight, more affordably - priced towables and gas Class A and Class C motorhomes as consumers seek value » Wholesale units typically outpace retail in the early part of the calendar year; historically sales become more balanced
Slide 31: Thor Dealer Inventory
Thor Dealer Inventory » Dealers remain confident with orders reflecting normal ordering patterns » Dealers are beginning to build inventory in advance of the spring selling season » Dealer inventory levels in general are appropriate, to slightly low, for current conditions in both towable and motori
Slide 32: RV Industry Retail Market Share
Total Share % Total Share % Total Share % Total Share % THOR* 184,795 48.5% 195,973 47.4% 178,520 47.6% 160,663 48.9% Forest River** 131,851 34.6% 144,909 35.1% 132,923 35.4% 112,979 34.4% Grand Design 14,121 3.7% 11,717 2.8% 7,000 1.9% 4,174 1.3% Winnebago 12,031 3.2% 13,093 3.2% 12,143 3.2% 10,395
Slide 33: Thor RV Retail Market Share Trend
Thor RV Retail Market Share Trend (Units) 33 54.9% 53.7% 51.3% 49.7% 48.9% 49.7% 25.4% 29.4% 31.0% 32.8% 37.8% 41.7% 16.7% 22.1% 21.9% 22.1% 18.3% 14.5% 2012 2013 2014 2015 2016 2017 YTD Towable Retail Share* Class A/C Retail Share* Class B Retail Share* *Source: Statistical Surveys Inc., U.S. and C
Slide 34: www.thorindustries.com
www.thorindustries.com