Winnebago(WGO) - 2024 Q4 - Annual Report

Financial Performance - Net revenues for Fiscal 2024 decreased to $2,973.5 million, a decline of 14.8% from$ 3,490.7 million in Fiscal 2023[125] - Gross profit fell to $433.5 million, representing 14.6% of revenues, down from 16.8% in the previous year, a decrease of 26.0%[125] - Operating income dropped significantly to$ 100.2 million, a decline of 66.7% compared to $300.7 million in Fiscal 2023[125] - Net income for Fiscal 2024 was$ 13.0 million, down 94.0% from $215.9 million in Fiscal 2023[125] - Adjusted EBITDA for Fiscal 2024 was$ 190.6 million, a decrease of 46.2% from $354.7 million in Fiscal 2023[129] - Basic earnings per share dropped to$ 0.44 from $7.12, reflecting a decline of 93.8% year-over-year[194] Segment Performance - Towable RV segment net revenues decreased to$ 1,318.8 million in 2024 from $1,415.3 million in 2023, a decline of 6.8%[131] - Adjusted EBITDA for the Towable RV segment fell to$ 122.4 million, representing a margin of 9.3%, down from $172.1 million and 12.2% in the previous year[131] - Motorhome RV segment net revenues dropped to$ 1,279.8 million in 2024, an 18.0% decrease from $1,560.1 million in 2023[134] - Adjusted EBITDA for the Motorhome RV segment decreased to$ 73.7 million, with a margin of 5.8%, down from $142.0 million and 9.1% in 2023[134] - Marine segment net revenues fell to$ 325.5 million in 2024, a decline of 30.7% from $469.7 million in 2023[138] - Adjusted EBITDA for the Marine segment decreased to$ 25.6 million, with a margin of 7.9%, down from $60.5 million and 12.9% in the previous year[138] Expenses and Costs - Cost of goods sold decreased to$ 2,540.0 million, representing 85.4% of revenues, down from 83.2% in the previous year[125] - Selling, general, and administrative expenses increased to $280.0 million, accounting for 9.4% of revenues, up from 7.7% in Fiscal 2023[125] - Advertising costs for Fiscal 2024 were$ 21.9 million, compared to $21.3 million in Fiscal 2023 and$ 23.3 million in Fiscal 2022[226] Cash Flow and Working Capital - Total cash provided by operating activities was $143.9 million in 2024, a significant decrease from$ 294.5 million in 2023[141] - Working capital as of August 31, 2024, was $584.0 million, down from$ 600.7 million as of August 26, 2023[147] Impairments and Charges - The company recognized a $30.3 million goodwill impairment charge related to the Chris-Craft reporting unit during the fourth quarter of Fiscal 2024[118] - The company recorded a$ 30.3 million impairment charge for the Chris-Craft reporting unit, representing the full goodwill balance attributable to that unit[162] - Goodwill impairment recorded was $30.3 million, with no prior year comparison available[199] Assets and Liabilities - Total assets as of August 31, 2024, were$ 2,384.2 million, a decrease from $2,432.4 million in the previous year[197] - Total liabilities increased to$ 1,110.9 million from $1,064.3 million, indicating a rise of 4.4%[197] - The product warranty accrual for Grand Design was$ 78.9 million, down from $97.8 million, reflecting a decrease of 19.0%[197] Debt and Financing - The company issued$ 350.0 million in aggregate principal amount of 3.25% unsecured convertible senior notes due 2030, with net proceeds of approximately $339.8 million after transaction fees[272] - The company repurchased$ 240.7 million of 2025 Convertible Notes, incurring a loss of $32.7 million on the repurchase[119] - The total debt increased from$ 600.0 million in 2023 to $709.3 million in 2024, with long-term debt net value rising to$ 637.1 million[266] Internal Controls and Accounting - The company maintains effective internal control over financial reporting as of August 31, 2024, according to the audit opinion[188] - The company’s critical accounting policies and estimates are reviewed with the Audit Committee to ensure transparency and accuracy in financial reporting[156] - The company has not adopted any new accounting standards during the fiscal year ended August 31, 2024, that had a material impact on its consolidated results[229] Future Outlook - The company anticipates capital expenditures of approximately $50.0 million to$ 60.0 million in Fiscal 2025 to support organic growth and operational improvements[148] - The company anticipates satisfying its short-term and long-term obligations through a combination of cash on hand, operational cash flow, and borrowing capacity[154]