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FORM 10-Q
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(Mark One)
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended November 26, 2016
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or
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from _________________ to _________________
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Commission File Number:
001-06403
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WINNEBAGO INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
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Iowa
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42-0802678
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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P. O. Box 152, Forest City, Iowa
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50436
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(Address of principal executive offices)
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(Zip Code)
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(641) 585-3535
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(Registrant's telephone number, including area code)
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Large accelerated filer
o
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Accelerated filer
x
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Non-accelerated filer
o
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Smaller Reporting Company
o
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A
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Item 2.
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Item 6.
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ABL
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Credit Agreement dated as of November 8, 2016 among Winnebago Industries, Inc., Winnebago of Indiana, LLC, Grand Design RV, LLC, the Other Loan Parties thereto and JPMorgan Chase Bank, N.A. as Administrative Agent
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AOCI
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Accumulated Other Comprehensive Income (Loss)
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Amended Credit Agreement
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Credit Agreement dated as of May 28, 2014 by and between Winnebago Industries, Inc. and Winnebago of Indiana, LLC, as Borrowers, and Wells Fargo Capital Finance, as Agent; terminated on November 8, 2016
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ASC
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Accounting Standards Codification
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ASP
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Average Sales Price
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ASU
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Accounting Standards Update
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Credit Facility
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Collective reference to the ABL and Term Loan
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EBITDA
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Earnings Before Income Taxes, Depreciation and Amortization
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EPS
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Earnings Per Share
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ERP
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Enterprise Resource Planning
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FASB
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Financial Accounting Standards Board
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FIFO
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First In, First Out
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GAAP
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Generally Accepted Accounting Principles
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Grand Design
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Grand Design RV, LLC
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IRS
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Internal Revenue Service
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IT
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Information Technology
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LIFO
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Last In, First Out
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LIBOR
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London Interbank Offered Rate
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Motorized
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Business segment including motorhomes and other related manufactured products
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NMF
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Non-Meaningful Figure
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NYFRB
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New York Federal Reserve Bank
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NYSE
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New York Stock Exchange
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OCI
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Other Comprehensive Income
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RV
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Recreation Vehicle
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RVIA
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Recreation Vehicle Industry Association
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SPA
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Securities Purchase Agreement dated October 2, 2016
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SEC
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U.S. Securities and Exchange Commission
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SERP
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Supplemental Executive Retirement Plan
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Stat Surveys
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Statistical Surveys, Inc.
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Term Loan
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Loan Agreement dated as of November 8, 2016 among Winnebago Industries, Inc., Octavius Corporation, the other loan parties thereto and JPMorgan Chase Bank, N.A. as Administrative Agent
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Towable
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Business segment including products which are not motorized and are towable by another vehicle
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US
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United States of America
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XBRL
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eXtensible Business Reporting Language
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Three Months Ended
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||||||
(In thousands, except per share data)
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November 26,
2016 |
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November 28,
2015 |
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Net revenues
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$
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245,308
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$
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214,223
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Cost of goods sold
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216,433
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188,974
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Gross profit
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28,875
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25,249
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Operating expenses:
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Selling
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5,870
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5,015
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General and administrative
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9,906
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8,820
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Postretirement health care benefit income
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(12,813
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)
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(1,345
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)
|
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Transaction costs
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5,462
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—
|
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Amortization of intangible assets
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2,051
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—
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Total operating expenses
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10,476
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12,490
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Operating income
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18,399
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12,759
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Interest expense
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1,128
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—
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Non-operating income
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(87
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)
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(135
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)
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Income before income taxes
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17,358
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12,894
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Provision for income taxes
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5,620
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4,336
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Net income
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$
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11,738
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$
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8,558
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Income per common share:
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Basic
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$
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0.42
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$
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0.32
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Diluted
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$
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0.42
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$
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0.32
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||||
Weighted average common shares outstanding:
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||||
Basic
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27,836
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26,976
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Diluted
|
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27,969
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27,067
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Dividends paid per common share
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$
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0.10
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$
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0.10
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Net income
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$
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11,738
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$
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8,558
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Other comprehensive (loss) income:
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Amortization of prior service credit
(net of tax of $7,914 and $653)
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(12,858
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)
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(1,060
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)
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Amortization of net actuarial loss
(net of tax of $3,036 and $142)
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4,932
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231
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Plan amendment
(net of tax of $2,402 and $10,895)
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3,903
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17,701
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Total other comprehensive (loss) income
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(4,023
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)
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16,872
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Comprehensive income
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$
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7,715
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$
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25,430
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(In thousands, except per share data)
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November 26,
2016 |
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August 27,
2016 |
||||
Assets
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Current assets:
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Cash and cash equivalents
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$
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25,584
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$
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85,583
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Receivables, less allowance for doubtful accounts ($238 and $278)
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81,762
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66,184
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Inventories
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155,446
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122,522
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Prepaid expenses and other assets
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10,561
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6,300
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Total current assets
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273,353
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280,589
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Property, plant and equipment, net
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66,703
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55,931
|
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Other assets:
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|
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Goodwill
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251,210
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1,228
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Other intangible assets, net
|
251,049
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—
|
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Investment in life insurance
|
26,653
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26,492
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Deferred income taxes
|
7,706
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18,753
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Other assets
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6,021
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7,725
|
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Total assets
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$
|
882,695
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$
|
390,718
|
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||||
Liabilities and Shareholders' Equity
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Current liabilities:
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|
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Accounts payable
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$
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50,971
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$
|
44,134
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Current maturities of long-term debt
|
7,578
|
|
|
—
|
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Income taxes payable
|
3,541
|
|
|
19
|
|
||
Accrued expenses:
|
|
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|
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Accrued compensation
|
20,452
|
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|
19,699
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|
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Product warranties
|
24,551
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|
12,412
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|
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Self-insurance
|
6,037
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|
5,812
|
|
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Accrued loss on repurchases
|
1,340
|
|
|
881
|
|
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Promotional
|
8,078
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|
|
4,756
|
|
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Other
|
5,919
|
|
|
5,236
|
|
||
Total current liabilities
|
128,467
|
|
|
92,949
|
|
||
Non-current liabilities:
|
|
|
|
||||
Long-term debt, less current maturities
|
334,742
|
|
|
—
|
|
||
Unrecognized tax benefits
|
2,066
|
|
|
2,461
|
|
||
Deferred compensation and postretirement health care benefits, net of current portion
|
19,961
|
|
|
26,949
|
|
||
Total non-current liabilities
|
356,769
|
|
|
29,410
|
|
||
Shareholders' equity:
|
|
|
|
||||
Capital stock common, par value $0.50;
authorized 60,000 shares, issued 51,776 shares
|
25,888
|
|
|
25,888
|
|
||
Additional paid-in capital
|
78,941
|
|
|
32,717
|
|
||
Retained earnings
|
629,099
|
|
|
620,546
|
|
||
Accumulated other comprehensive income
|
6,952
|
|
|
10,975
|
|
||
Treasury stock, at cost (20,230 and 24,875 shares)
|
(343,421
|
)
|
|
(421,767
|
)
|
||
Total shareholders' equity
|
397,459
|
|
|
268,359
|
|
||
Total liabilities and shareholders' equity
|
$
|
882,695
|
|
|
$
|
390,718
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
November 26,
2016 |
|
November 28,
2015 |
||||
Operating activities:
|
|
|
|
||||
Net income
|
$
|
11,738
|
|
|
$
|
8,558
|
|
Adjustments to reconcile net income to net cash used in
operating activities:
|
|
|
|
||||
Depreciation
|
1,580
|
|
|
1,370
|
|
||
Amortization of intangible assets
|
2,051
|
|
|
—
|
|
||
Amortization of debt issuance costs
|
78
|
|
|
—
|
|
||
LIFO expense (income)
|
299
|
|
|
(90
|
)
|
||
Stock-based compensation
|
821
|
|
|
623
|
|
||
Deferred income taxes
|
(1,613
|
)
|
|
382
|
|
||
Postretirement benefit income and deferred compensation expense
|
(12,471
|
)
|
|
(777
|
)
|
||
Other
|
(271
|
)
|
|
(295
|
)
|
||
Change in assets and liabilities:
|
|
|
|
||||
Inventories
|
(17,923
|
)
|
|
(24,109
|
)
|
||
Receivables, prepaid and other assets
|
16,080
|
|
|
7,366
|
|
||
Income taxes and unrecognized tax benefits
|
8,200
|
|
|
1,254
|
|
||
Accounts payable and accrued expenses
|
(7,977
|
)
|
|
(1,375
|
)
|
||
Postretirement and deferred compensation benefits
|
(742
|
)
|
|
(970
|
)
|
||
Net cash used in operating activities
|
(150
|
)
|
|
(8,063
|
)
|
||
|
|
|
|
||||
Investing activities:
|
|
|
|
||||
Purchases of property, plant and equipment
|
(3,562
|
)
|
|
(3,109
|
)
|
||
Proceeds from the sale of property
|
—
|
|
|
5
|
|
||
Acquisition of business, net of cash acquired
|
(394,835
|
)
|
|
—
|
|
||
Proceeds from life insurance
|
—
|
|
|
295
|
|
||
Other
|
901
|
|
|
(220
|
)
|
||
Net cash used in investing activities
|
(397,496
|
)
|
|
(3,029
|
)
|
||
|
|
|
|
||||
Financing activities:
|
|
|
|
||||
Payments for repurchases of common stock
|
(1,318
|
)
|
|
(705
|
)
|
||
Payments of cash dividends
|
(3,185
|
)
|
|
(2,730
|
)
|
||
Payments of debt issuance costs
|
(10,758
|
)
|
|
—
|
|
||
Borrowings on credit facility
|
353,000
|
|
|
—
|
|
||
Other
|
(92
|
)
|
|
9
|
|
||
Net cash provided by (used in) financing activities
|
337,647
|
|
|
(3,426
|
)
|
||
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
(59,999
|
)
|
|
(14,518
|
)
|
||
Cash and cash equivalents at beginning of period
|
85,583
|
|
|
70,239
|
|
||
Cash and cash equivalents at end of period
|
$
|
25,584
|
|
|
$
|
55,721
|
|
|
|
|
|
||||
Supplement cash flow disclosure:
|
|
|
|
||||
Income taxes paid, net
|
$
|
121
|
|
|
$
|
2,675
|
|
Non-cash transactions:
|
|
|
|
||||
Issuance of Winnebago common stock for acquisition of business
|
$
|
124,066
|
|
|
$
|
—
|
|
Capital expenditures in accounts payable
|
$
|
695
|
|
|
$
|
826
|
|
(In thousands, except shares)
|
|
November 8,
2016 |
||
Cash
|
|
$
|
396,583
|
|
Winnebago shares: 4,586,555 at $27.05 per share
|
|
124,066
|
|
|
Total
|
|
$
|
520,649
|
|
(in thousands)
|
|
November 8,
2016 |
||
Cash
|
|
$
|
1,748
|
|
Accounts receivable
|
|
32,834
|
|
|
Inventories
|
|
15,300
|
|
|
Prepaid expenses and other assets
|
|
2,161
|
|
|
Property, plant and equipment
|
|
8,998
|
|
|
Goodwill
|
|
249,981
|
|
|
Other intangible assets
|
|
253,100
|
|
|
Total assets acquired
|
|
564,122
|
|
|
|
|
|
||
Accounts payable
|
|
11,151
|
|
|
Accrued compensation
|
|
3,615
|
|
|
Product warranties
|
|
12,904
|
|
|
Promotional
|
|
3,976
|
|
|
Other
|
|
1,569
|
|
|
Deferred tax liabilities
|
|
10,258
|
|
|
Total liabilities assumed
|
|
43,473
|
|
|
|
|
|
||
Total purchase price
|
|
$
|
520,649
|
|
(in thousands)
|
|
Weighted
Average Life-
Years
|
|
Fair Value
Amount
|
|
Accumulated
Amortization
|
||||
Trade name
|
|
Indefinite
|
|
$
|
148,000
|
|
|
$
|
—
|
|
Dealer network
|
|
12.0
|
|
80,500
|
|
|
331
|
|
||
Backlog
|
|
0.5
|
|
18,000
|
|
|
1,639
|
|
||
Non-compete agreements
|
|
4.0
|
|
4,600
|
|
|
69
|
|
||
Leasehold interest-favorable
|
|
8.1
|
|
2,000
|
|
|
12
|
|
||
Total
|
|
|
|
253,100
|
|
|
$
|
2,051
|
|
|
Accumulated amortization
|
|
|
|
(2,051
|
)
|
|
|
|||
Net book value of intangible assets
|
|
|
|
$
|
251,049
|
|
|
|
(in thousands)
|
|
Amount
|
||
Remainder of 2017
|
|
$
|
22,610
|
|
2018
|
|
7,854
|
|
|
2019
|
|
7,733
|
|
|
2020
|
|
7,733
|
|
|
2021
|
|
7,733
|
|
|
2022
|
|
7,106
|
|
|
Thereafter
|
|
42,280
|
|
|
|
Three Months Ended
|
||
(in thousands)
|
|
November 26, 2016
|
||
Net revenues
|
|
$
|
25,836
|
|
Operating income
|
|
760
|
|
|
|
Three Months Ended
|
||||||
(In thousands, except per share data)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Net revenues
|
|
$
|
340,975
|
|
|
$
|
300,383
|
|
Net income
|
|
20,269
|
|
|
1,197
|
|
||
Income per share - basic
|
|
0.64
|
|
|
0.04
|
|
||
Income per share - diluted
|
|
0.64
|
|
|
0.04
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Amortization of intangibles (1 year or less useful life)
|
|
$
|
(1,941
|
)
|
|
$
|
8,708
|
|
Increase in amortization of intangibles
|
|
1,551
|
|
|
1,933
|
|
||
Expenses related to business combination (transaction costs)
(1)
|
|
(5,519
|
)
|
|
5,840
|
|
||
Interest to reflect new debt structure
|
|
3,672
|
|
|
4,958
|
|
||
Taxes related to the adjustments to the pro forma data and to the income of Grand Design
|
|
5,011
|
|
|
(4,323
|
)
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Net revenues
|
|
|
|
|
||||
Motorized
|
|
$
|
195,125
|
|
|
$
|
197,340
|
|
Towable
|
|
50,183
|
|
|
16,883
|
|
||
Consolidated
|
|
$
|
245,308
|
|
|
$
|
214,223
|
|
|
|
|
|
|
||||
Adjusted EBITDA
|
|
|
|
|
||||
Motorized
|
|
$
|
10,015
|
|
|
$
|
11,724
|
|
Towable
|
|
4,664
|
|
|
1,060
|
|
||
Consolidated
|
|
$
|
14,679
|
|
|
$
|
12,784
|
|
|
|
|
|
|
||||
Capital Expenditures
|
|
|
|
|
||||
Motorized
|
|
$
|
3,146
|
|
|
$
|
2,872
|
|
Towable
|
|
416
|
|
|
237
|
|
||
Consolidated
|
|
$
|
3,562
|
|
|
$
|
3,109
|
|
|
|
|
|
|
||||
Total Assets
|
|
|
|
|
||||
Motorized
|
|
$
|
307,125
|
|
|
$
|
329,081
|
|
Towable
|
|
575,570
|
|
|
25,251
|
|
||
Consolidated
|
|
$
|
882,695
|
|
|
$
|
354,332
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Net income
|
|
$
|
11,738
|
|
|
$
|
8,558
|
|
Interest expense
|
|
1,128
|
|
|
—
|
|
||
Provision for income taxes
|
|
5,620
|
|
|
4,336
|
|
||
Depreciation
|
|
1,580
|
|
|
1,370
|
|
||
Amortization of intangible assets
|
|
2,051
|
|
|
—
|
|
||
EBITDA
|
|
22,117
|
|
|
14,264
|
|
||
Postretirement health care benefit income
|
|
(12,813
|
)
|
|
(1,345
|
)
|
||
Transaction costs
|
|
5,462
|
|
|
—
|
|
||
Non-operating income
|
|
(87
|
)
|
|
(135
|
)
|
||
Adjusted EBITDA
|
|
$
|
14,679
|
|
|
$
|
12,784
|
|
|
|
|
|
Fair Value Measurements
Using Inputs Considered As
|
||||||||||||
(In thousands)
|
|
Fair Value at
November 26, 2016 |
|
Level 1 Quoted Prices in Active Markets for Identical Assets
|
|
Level 2 Significant Other
Observable Inputs
|
|
Level 3 Significant
Unobservable Inputs
|
||||||||
Cash equivalents
(1)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Assets that fund deferred compensation:
|
|
|
|
|
|
|
|
|
||||||||
Domestic equity funds
|
|
3,482
|
|
|
3,395
|
|
|
87
|
|
|
—
|
|
||||
International equity funds
|
|
243
|
|
|
203
|
|
|
40
|
|
|
—
|
|
||||
Fixed income funds
|
|
272
|
|
|
201
|
|
|
71
|
|
|
—
|
|
||||
Total assets at fair value
|
|
$
|
3,997
|
|
|
$
|
3,799
|
|
|
$
|
198
|
|
|
$
|
—
|
|
|
|
|
|
Fair Value Measurements
Using Inputs Considered As
|
||||||||||||
(In thousands)
|
|
Fair Value at
August 27, 2016 |
|
Level 1 Quoted Prices in Active Markets for Identical Assets
|
|
Level 2 Significant Other
Observable Inputs
|
|
Level 3 Significant
Unobservable Inputs
|
||||||||
Cash equivalents
(1)
|
|
$
|
77,234
|
|
|
$
|
77,234
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Assets that fund deferred compensation:
|
|
|
|
|
|
|
|
|
||||||||
Domestic equity funds
|
|
3,587
|
|
|
3,515
|
|
|
72
|
|
|
—
|
|
||||
International equity funds
|
|
258
|
|
|
225
|
|
|
33
|
|
|
—
|
|
||||
Fixed income funds
|
|
265
|
|
|
206
|
|
|
59
|
|
|
—
|
|
||||
Total assets at fair value
|
|
$
|
81,344
|
|
|
$
|
81,180
|
|
|
$
|
164
|
|
|
$
|
—
|
|
(1)
|
Cash equivalent balances valued using Level 1 inputs include only those accounts that may fluctuate in value. Cash in disbursing accounts and on-demand accounts are not included above.
|
(In thousands)
|
|
November 26,
2016 |
|
August 27,
2016 |
||||
Finished goods
|
|
$
|
41,175
|
|
|
$
|
19,129
|
|
Work-in-process
|
|
76,569
|
|
|
76,350
|
|
||
Raw materials
|
|
71,698
|
|
|
60,740
|
|
||
Total
|
|
189,442
|
|
|
156,219
|
|
||
LIFO reserve
|
|
(33,996
|
)
|
|
(33,697
|
)
|
||
Total inventories
|
|
$
|
155,446
|
|
|
$
|
122,522
|
|
(In thousands)
|
|
November 26,
2016 |
|
August 27,
2016 |
||||
Land
|
|
$
|
4,047
|
|
|
$
|
3,864
|
|
Buildings and building improvements
|
|
69,329
|
|
|
62,073
|
|
||
Machinery and equipment
|
|
98,285
|
|
|
95,087
|
|
||
Software
|
|
17,396
|
|
|
15,878
|
|
||
Transportation
|
|
9,153
|
|
|
8,956
|
|
||
Total property, plant and equipment, gross
|
|
198,210
|
|
|
185,858
|
|
||
Less accumulated depreciation
|
|
(131,507
|
)
|
|
(129,927
|
)
|
||
Total property, plant and equipment, net
|
|
$
|
66,703
|
|
|
$
|
55,931
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Balance at beginning of period
|
|
$
|
12,412
|
|
|
$
|
11,254
|
|
Provision
|
|
3,898
|
|
|
3,594
|
|
||
Claims paid
|
|
(4,663
|
)
|
|
(3,263
|
)
|
||
Acquisition of Grand Design
|
|
12,904
|
|
|
—
|
|
||
Balance at end of period
|
|
$
|
24,551
|
|
|
$
|
11,585
|
|
(In thousands)
|
|
November 26,
2016 |
|
August 27,
2016 |
||||
ABL
|
|
$
|
53,000
|
|
|
$
|
—
|
|
Term Loan
|
|
300,000
|
|
|
—
|
|
||
|
|
353,000
|
|
|
—
|
|
||
Less: debt issuance cost, net
|
|
(10,680
|
)
|
|
—
|
|
||
|
|
342,320
|
|
|
—
|
|
||
Less: current maturities
|
|
(7,578
|
)
|
|
—
|
|
||
Long-term debt, less current maturities
|
|
$
|
334,742
|
|
|
$
|
—
|
|
(In thousands)
|
|
Amount
|
|||
Year:
|
2017
|
|
$
|
6,000
|
|
|
2018
|
|
14,250
|
|
|
|
2019
|
|
15,000
|
|
|
|
2020
|
|
15,000
|
|
|
|
2021
|
|
15,000
|
|
|
|
2022
|
|
68,000
|
|
|
|
2023
|
|
15,000
|
|
|
|
2024
|
|
204,750
|
|
|
|
Total debt
|
|
$
|
353,000
|
|
(In thousands)
|
|
November 26,
2016 |
|
August 27,
2016 |
||||
Postretirement health care benefit cost
|
|
$
|
32
|
|
|
$
|
6,346
|
|
Non-qualified deferred compensation
|
|
17,616
|
|
|
18,003
|
|
||
Executive share option plan liability
|
|
3,181
|
|
|
3,341
|
|
||
SERP benefit liability
|
|
2,701
|
|
|
2,681
|
|
||
Executive deferred compensation
|
|
467
|
|
|
389
|
|
||
Officer stock-based compensation
|
|
657
|
|
|
763
|
|
||
Total deferred compensation and postretirement health care benefits
|
|
24,654
|
|
|
31,523
|
|
||
Less current portion
|
|
(4,693
|
)
|
|
(4,574
|
)
|
||
Long-term deferred compensation and postretirement health care benefits
|
|
$
|
19,961
|
|
|
$
|
26,949
|
|
Date
|
Event
|
|
Dollar Cap
Reduction
|
Liability
Reduction
(In thousands)
|
Amortization
Period
(1)
|
|||
Fiscal 2005
|
Established employer dollar caps
|
|
|
$
|
40,414
|
|
11.5
|
years
|
January 2012
|
Reduced employer dollar caps
|
|
10%
|
4,598
|
|
7.8
|
years
|
|
January 2013
|
Reduced employer dollar caps
|
|
10%
|
4,289
|
|
7.5
|
years
|
|
January 2014
|
Reduced employer dollar caps
|
|
10%
|
3,580
|
|
7.3
|
years
|
|
January 2015
|
Reduced employer dollar caps
|
|
10%
|
3,960
|
|
7.1
|
years
|
|
January 2016
|
Reduced employer dollar caps for retirees under age 65; discontinued retiree benefits for retirees age 65 and over
|
|
10%
|
28,596
|
|
6.9
|
years
|
|
January 2017
(2)
|
Terminated plan
|
|
|
6,338
|
|
0.2
|
years
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Interest cost
|
|
$
|
29
|
|
|
$
|
153
|
|
Service cost
|
|
16
|
|
|
41
|
|
||
Amortization of prior service benefit
|
|
(20,772
|
)
|
|
(1,713
|
)
|
||
Amortization of net actuarial loss
|
|
7,959
|
|
|
368
|
|
||
Net periodic postretirement benefit income
|
|
$
|
(12,768
|
)
|
|
$
|
(1,151
|
)
|
|
|
|
|
|
||||
Payments for postretirement health care
|
|
$
|
53
|
|
|
$
|
228
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Inventory repurchased
|
|
$
|
—
|
|
|
$
|
—
|
|
Cash collected on resold inventory
|
|
$
|
—
|
|
|
$
|
36
|
|
Gain realized on resold inventory
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
(In thousands)
|
|
Amount
|
|||
Year Ended:
|
2017
|
|
$
|
1,450
|
|
|
2018
|
|
2,181
|
|
|
|
2019
|
|
2,084
|
|
|
|
2020
|
|
2,084
|
|
|
|
2021
|
|
2,084
|
|
|
|
Thereafter
|
|
6,994
|
|
|
|
Total
|
|
$
|
16,877
|
|
|
|
Three Months Ended
|
||||||
(In thousands, except per share data)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Income per share - basic
|
|
|
|
|
||||
Net income
|
|
$
|
11,738
|
|
|
$
|
8,558
|
|
Weighted average shares outstanding
|
|
27,836
|
|
|
26,976
|
|
||
Net income per share - basic
|
|
$
|
0.42
|
|
|
$
|
0.32
|
|
|
|
|
|
|
||||
Income per share - assuming dilution
|
|
|
|
|
||||
Net income
|
|
$
|
11,738
|
|
|
$
|
8,558
|
|
Weighted average shares outstanding
|
|
27,836
|
|
|
26,976
|
|
||
Dilutive impact of awards and options outstanding
|
|
133
|
|
|
91
|
|
||
Weighted average shares and potential dilutive shares outstanding
|
|
27,969
|
|
|
27,067
|
|
||
Net income per share - assuming dilution
|
|
$
|
0.42
|
|
|
$
|
0.32
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Balance at beginning of period
|
|
$
|
10,975
|
|
|
$
|
(2,274
|
)
|
|
|
|
|
|
||||
OCI before reclassifications
|
|
3,903
|
|
|
17,701
|
|
||
Amounts reclassified from AOCI
|
|
(7,926
|
)
|
|
(829
|
)
|
||
Net current-period OCI
|
|
(4,023
|
)
|
|
16,872
|
|
||
|
|
|
|
|
||||
Balance at end of period
|
|
$
|
6,952
|
|
|
$
|
14,598
|
|
|
|
|
|
Three Months Ended
|
||||||
(In thousands)
|
|
Location on Consolidated Statements
of Income and Comprehensive Income
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
Amortization of prior service credit
|
|
Operating expenses
|
|
$
|
(12,858
|
)
|
|
$
|
(1,060
|
)
|
Amortization of net actuarial loss
|
|
Operating expenses
|
|
4,932
|
|
|
231
|
|
||
Total reclassifications
|
|
|
|
$
|
(7,926
|
)
|
|
$
|
(829
|
)
|
|
|
Rolling 12 Months
Through October
|
|
Calendar Year
|
||||||||
US and Canada
|
|
2016
|
2015
|
|
2015
|
2014
|
2013
|
|||||
Motorized A, B, C
|
|
18.1
|
%
|
20.7
|
%
|
|
20.4
|
%
|
20.7
|
%
|
18.6
|
%
|
Travel trailer and fifth wheels - Winnebago
|
|
1.1
|
%
|
0.9
|
%
|
|
0.9
|
%
|
0.8
|
%
|
1.0
|
%
|
Travel trailer and fifth wheels - Grand Design
|
|
3.2
|
%
|
2.1
|
%
|
|
2.2
|
%
|
1.5
|
%
|
0.3
|
%
|
•
|
Wholesale unit shipments: RV product delivered to the dealers, which is reported monthly by RVIA
|
•
|
Retail unit registrations: consumer purchases of RVs from the dealer, which is reported monthly by Stat Surveys
|
|
US and Canada Industry
|
||||||||||||||||
|
Wholesale Unit Shipments per RVIA
|
|
Retail Unit Registrations per Stat Surveys
|
||||||||||||||
|
Rolling 12 Months through October
|
|
Rolling 12 Months through October
|
||||||||||||||
|
2016
|
|
2015
|
|
Unit Change
|
% Change
|
|
2016
|
|
2015
|
|
Unit Change
|
% Change
|
||||
Towable
(1)
|
343,579
|
|
312,885
|
|
30,694
|
|
9.8
|
%
|
|
343,145
|
|
313,622
|
|
29,523
|
|
9.4
|
%
|
Motorized
(2)
|
53,459
|
|
46,140
|
|
7,319
|
|
15.9
|
%
|
|
48,998
|
|
44,228
|
|
4,770
|
|
10.8
|
%
|
Combined
|
397,038
|
|
359,025
|
|
38,013
|
|
10.6
|
%
|
|
392,143
|
|
357,850
|
|
34,293
|
|
9.6
|
%
|
(1)
|
Towable: Fifth wheel and travel trailer products
|
(2)
|
Motorized: Class A, B and C products
|
|
|
Calendar Year
|
|||||||
Wholesale Unit Shipment Forecast per RVIA
(1)
|
|
2017
|
|
2016
|
|
Unit Change
|
% Change
|
||
Towable
|
|
370,300
|
|
353,000
|
|
17,300
|
|
4.9
|
%
|
Motorized
|
|
54,800
|
|
53,300
|
|
1,500
|
|
2.8
|
%
|
Combined
|
|
425,100
|
|
406,300
|
|
18,800
|
|
4.6
|
%
|
(1)
|
Prepared by Dr. Richard Curtin of the University of Michigan Consumer Survey Research Center for RVIA and reported in the Roadsigns RV Winter 2016 Industry Forecast Issue.
|
|
|
Fiscal
|
|
Fiscal
|
|
Fiscal 2017
|
|
Cumulative
|
|||||||||||
(In thousands)
|
|
2015
|
|
2016
|
|
Q1
|
|
Investment
|
|||||||||||
Capitalized
|
|
$
|
3,291
|
|
|
$
|
7,798
|
|
|
$
|
1,518
|
|
|
$
|
12,607
|
|
(1)
|
57
|
%
|
Expensed
|
|
2,528
|
|
|
5,930
|
|
|
1,165
|
|
|
9,623
|
|
|
43
|
%
|
||||
Total
|
|
$
|
5,819
|
|
|
$
|
13,728
|
|
|
$
|
2,683
|
|
|
$
|
22,230
|
|
|
100
|
%
|
|
|
Three Months Ended
|
||||||||||||||||
(In thousands, except percent
and per share data)
|
|
November 26,
2016 |
% of
Revenues
(1)
|
|
November 28,
2015 |
% of
Revenues
(1)
|
|
Increase
(Decrease)
|
%
Change
|
|||||||||
Net revenues
|
|
$
|
245,308
|
|
100.0
|
%
|
|
$
|
214,223
|
|
100.0
|
%
|
|
$
|
31,085
|
|
14.5
|
%
|
Cost of goods sold
|
|
216,433
|
|
88.2
|
%
|
|
188,974
|
|
88.2
|
%
|
|
27,459
|
|
14.5
|
%
|
|||
Gross profit
|
|
28,875
|
|
11.8
|
%
|
|
25,249
|
|
11.8
|
%
|
|
3,626
|
|
14.4
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Selling
|
|
5,870
|
|
2.4
|
%
|
|
5,015
|
|
2.3
|
%
|
|
855
|
|
17.0
|
%
|
|||
General and administrative
|
|
9,906
|
|
4.0
|
%
|
|
8,820
|
|
4.1
|
%
|
|
1,086
|
|
12.3
|
%
|
|||
Postretirement health care benefit income
|
|
(12,813
|
)
|
(5.2
|
)%
|
|
(1,345
|
)
|
(0.6
|
)%
|
|
(11,468
|
)
|
NMF
|
|
|||
Transaction costs
|
|
5,462
|
|
2.2
|
%
|
|
—
|
|
—
|
%
|
|
5,462
|
|
—
|
%
|
|||
Amortization of intangibles assets
|
|
2,051
|
|
0.8
|
%
|
|
—
|
|
—
|
%
|
|
2,051
|
|
—
|
%
|
|||
Operating expenses
|
|
10,476
|
|
4.3
|
%
|
|
12,490
|
|
5.8
|
%
|
|
(2,014
|
)
|
(16.1
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Operating income
|
|
18,399
|
|
7.5
|
%
|
|
12,759
|
|
6.0
|
%
|
|
5,640
|
|
44.2
|
%
|
|||
Interest expense
|
|
1,128
|
|
0.5
|
%
|
|
—
|
|
—
|
%
|
|
1,128
|
|
—
|
%
|
|||
Non-operating income
|
|
(87
|
)
|
—
|
%
|
|
(135
|
)
|
(0.1
|
)%
|
|
48
|
|
(35.6
|
)%
|
|||
Income before income taxes
|
|
17,358
|
|
7.1
|
%
|
|
12,894
|
|
6.0
|
%
|
|
4,464
|
|
34.6
|
%
|
|||
Provision for taxes
|
|
5,620
|
|
2.3
|
%
|
|
4,336
|
|
2.0
|
%
|
|
1,284
|
|
29.6
|
%
|
|||
Net income
|
|
$
|
11,738
|
|
4.8
|
%
|
|
$
|
8,558
|
|
4.0
|
%
|
|
$
|
3,180
|
|
37.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Diluted income per share
|
|
$
|
0.42
|
|
|
|
$
|
0.32
|
|
|
|
$
|
0.10
|
|
31.3
|
%
|
||
Diluted average shares outstanding
|
|
27,969
|
|
|
|
27,067
|
|
|
|
902
|
|
3.3
|
%
|
•
|
Total variable costs (materials, direct labor, variable overhead, delivery expense and warranty), as a percent of net revenues, decreased from
83.6%
to
82.9%
, primarily due to favorable product mix in part due to our decision to cease aluminum extrusion sales and due to higher proportion of Towables revenue in the quarter.
|
•
|
Fixed overhead (manufacturing support labor, depreciation and facility costs) and research and development-related costs increased from
4.7%
to
5.3%
of net revenues due mainly to the addition of our Junction City, Oregon facility.
|
•
|
All factors considered, gross profit was steady at
11.8%
of net revenues.
|
•
|
We have provided the following non-GAAP financial measures, which are not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for, or as an alternative to, and should be considered in conjunction with, the GAAP financial measures presented herein. The non-GAAP financial measures presented below may differ from similar measures used by other companies.
|
•
|
The following table reconciles net income to consolidated Adjusted EBITDA.
|
|
|
|
Three Months Ended
|
||||||
|
(In thousands)
|
|
November 26,
2016 |
|
November 28,
2015 |
||||
|
Net income
|
|
$
|
11,738
|
|
|
$
|
8,558
|
|
|
Interest expense
|
|
1,128
|
|
|
—
|
|
||
|
Provision for income taxes
|
|
5,620
|
|
|
4,336
|
|
||
|
Depreciation
|
|
1,580
|
|
|
1,370
|
|
||
|
Amortization of intangible assets
|
|
2,051
|
|
|
—
|
|
||
|
EBITDA
|
|
22,117
|
|
|
14,264
|
|
||
|
Postretirement health care benefit income
|
|
(12,813
|
)
|
|
(1,345
|
)
|
||
|
Transaction costs
|
|
5,462
|
|
|
—
|
|
||
|
Non-operating income
|
|
(87
|
)
|
|
(135
|
)
|
||
|
Adjusted EBITDA
|
|
$
|
14,679
|
|
|
$
|
12,784
|
|
Motorized
|
|
|
|
|
|
|
|
|
|
|||||||||
(In thousands, except units)
|
|
Three Months Ended
|
||||||||||||||||
|
|
Nov 26,
2016 |
% of Revenue
|
|
Nov 28,
2015 |
% of Revenue
|
|
Decrease
|
%
Change
|
|||||||||
Net revenues
|
|
$
|
195,125
|
|
|
|
$
|
197,340
|
|
|
|
$
|
(2,215
|
)
|
(1.1
|
)%
|
||
Adjusted EBITDA
|
|
10,015
|
|
5.1
|
%
|
|
11,724
|
|
5.9
|
%
|
|
(1,709
|
)
|
(14.6
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Unit deliveries
|
|
Nov 26,
2016 |
Product
Mix %
(1)
|
|
Nov 28,
2015 |
Product
Mix %
(1)
|
|
(Decrease)
Increase
|
%
Change
|
|||||||||
Class A
|
|
666
|
|
33.3
|
%
|
|
751
|
|
39.1
|
%
|
|
(85
|
)
|
(11.3
|
)%
|
|||
Class B
|
|
301
|
|
15.1
|
%
|
|
239
|
|
12.4
|
%
|
|
62
|
|
25.9
|
%
|
|||
Class C
|
|
1,033
|
|
51.7
|
%
|
|
931
|
|
48.5
|
%
|
|
102
|
|
11.0
|
%
|
|||
Total motorhomes
|
|
2,000
|
|
100.0
|
%
|
|
1,921
|
|
100.0
|
%
|
|
79
|
|
4.1
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Motorhome ASP
|
|
$
|
95,046
|
|
|
|
$
|
97,887
|
|
|
|
$
|
(2,841
|
)
|
(2.9
|
)%
|
||
|
|
As Of
|
|
|
|
|||||||||||||
Backlog
(2)
|
|
Nov 26,
2016 |
|
|
Nov 28,
2015 |
|
|
(Decrease)
Increase
|
%
Change
|
|||||||||
Units
|
|
2,286
|
|
|
|
2,412
|
|
|
|
(126
|
)
|
(5.2
|
)%
|
|||||
Dollars
|
|
$
|
207,056
|
|
|
|
$
|
222,055
|
|
|
|
$
|
(14,999
|
)
|
(6.8
|
)%
|
||
|
|
|
|
|
|
|
|
|
|
|||||||||
Dealer Inventory
|
|
|
|
|
|
|
|
|
|
|||||||||
Units
|
|
4,330
|
|
|
|
4,115
|
|
|
|
215
|
|
5.2
|
%
|
Towable
|
|
|
|
|
|
|
|
|
|
|||||||||
(In thousands, except units)
|
|
Three Months Ended
|
||||||||||||||||
|
|
Nov 26,
2016 |
% of Revenue
|
|
Nov 28,
2015 |
% of Revenue
|
|
Increase
|
%
Change
|
|||||||||
Net revenues
|
|
$
|
50,183
|
|
|
|
$
|
16,883
|
|
|
|
$
|
33,300
|
|
197.2
|
%
|
||
Adjusted EBITDA
|
|
4,664
|
|
9.3
|
%
|
|
1,060
|
|
6.3
|
%
|
|
3,604
|
|
340.0
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Unit deliveries
|
|
Nov 26,
2016 |
Product
Mix %
(1)
|
|
Nov 28,
2015 |
Product
Mix %
(1)
|
|
Increase
|
%
Change
|
|||||||||
Travel trailer
|
|
1,509
|
|
75.0
|
%
|
|
724
|
|
88.7
|
%
|
|
785
|
|
108.4
|
%
|
|||
Fifth wheel
|
|
503
|
|
25.0
|
%
|
|
92
|
|
11.3
|
%
|
|
411
|
|
446.7
|
%
|
|||
Total Towables
|
|
2,012
|
|
100.0
|
%
|
|
816
|
|
100.0
|
%
|
|
1,196
|
|
146.6
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Towables ASP
|
|
24,862
|
|
|
|
20,685
|
|
|
|
4,177
|
|
20.2
|
%
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
As Of
|
|
|
|
|||||||||||||
Backlog
(2)
|
|
Nov 26,
2016 |
|
|
Nov 28,
2015 |
|
|
Increase
|
%
Change
|
|||||||||
Units
|
|
6,475
|
|
|
|
312
|
|
|
|
6,163
|
|
NMF
|
|
|||||
Dollars
|
|
$
|
214,178
|
|
|
|
$
|
7,249
|
|
|
|
$
|
206,929
|
|
NMF
|
|
||
|
|
|
|
|
|
|
|
|
|
|||||||||
Dealer Inventory
|
|
|
|
|
|
|
|
|
|
|||||||||
Units
|
|
7,118
|
|
|
|
1,838
|
|
|
|
5,280
|
|
287.3
|
%
|
•
|
Generation of net income of
$11.7 million
|
•
|
Acquisition of Grand Design for
$520.6 million
of which
$396.6 million
was cash and
$124.1 million
as of closing date was in Winnebago stock
|
•
|
Entered into a new Credit Facility with $125.0 million available in an ABL and $300.0 million in Term Loan (see details below). Total borrowings at November 26, 2016 were
$353.0 million
, and we have an additional $72.0 available to borrow under the
|
•
|
Increase in inventory of
$17.9 million
|
•
|
Dividend payments of
$3.2 million
|
|
|
Payments Due By Period
|
||||||||||||||
(In thousands)
|
|
Total
|
Fiscal
2017
|
Fiscal
2018-2019
|
Fiscal
2020-2021
|
More than
5 Years
|
||||||||||
Revolving credit agreement
(1)
|
|
$
|
53,000
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
53,000
|
|
Term debt
(2)
|
|
300,000
|
|
6,000
|
|
29,250
|
|
30,000
|
|
234,750
|
|
|||||
Interest at variable rate
(3)
|
|
105,321
|
|
13,565
|
|
34,146
|
|
30,870
|
|
26,740
|
|
|||||
Operating leases
(4)
|
|
16,877
|
|
1,450
|
|
4,265
|
|
4,168
|
|
6,994
|
|
|||||
Total contractual cash obligations
|
|
$
|
475,198
|
|
$
|
21,015
|
|
$
|
67,661
|
|
$
|
65,038
|
|
$
|
321,484
|
|
(1)
|
As of
November 26, 2016
, we had
$53.0 million
outstanding under our $125.0 million revolving credit agreement. Borrowings and repayments are expected to fluctuate over the term.
|
(2)
|
As of
November 26, 2016
, we had
$300.0 million
outstanding under our Term Loan agreement, that matures on November 8, 2023. The contractual principal payments are included in the table above. As discussed in the liquidity section of the MD&A above, additional principal payments are due annually on a formula based on 50% of excess cash flow. No amounts for this contingency are included in the above table.
|
(3)
|
All of the debt under the ABL and Term Loan are at variable rates and the interest in the table assumes the variable rates of 2.4% and 5.5%, respectively, at
November 26, 2016
are constant through the maturity dates of the debt; the revolving credit balance remains constant at $53.0 million; and the principal payments on the term debt are made as scheduled. The variable rate is subject to change. For example, a 1.0% change in ABL and Term Loan rates for Fiscal 2017, would change the interest paid for the remainder of 2017 by $2.7 million. Additionally, included in interest payments due by period is a 0.4% commitment fee on the ABL for unused borrowings, which are assumed to be at $72.0 million. In addition to interest assumed to be paid, non-cash amortization of debt issuance costs will also be recorded within interest expense on the Consolidated Statements of Income and Comprehensive Income in future periods.
|
(4)
|
Represents only the additional lease commitments from the Grand Design acquisition. Refer to
Note 12
.
|
•
|
Demands on management related to the various transaction and integration activities;
|
•
|
The diversion of management’s attention from the management of daily operations to the integration of operations;
|
•
|
The assimilation and retention of employees;
|
•
|
The ability of the management teams at these entities to meet operational and financial expectations;
|
•
|
The integration of departments and systems, including accounting systems, technologies, books and records and procedures;
|
•
|
Additional costs may be incurred to integrate the businesses;
|
•
|
The potential loss of key employees or existing customers or adverse effects on existing business relationships with suppliers and customers; and
|
•
|
The assumption of liabilities of the acquired businesses, which could be greater than anticipated.
|
•
|
Make us more vulnerable to general adverse economic, regulatory and industry conditions;
|
•
|
Limit our flexibility in planning for, or reacting to, changes and opportunities in the markets in which we compete;
|
•
|
Place us at a competitive disadvantage compared to our competitors that have less debt or could require us to dedicate a substantial portion of our cash flow to service our debt; and
|
•
|
Restrict us from making strategic acquisitions or exploiting other business opportunities.
|
Period
|
Total Number
of Shares
Purchased
|
Average Price
Paid per Share
|
Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs
|
Approximate Dollar Value
of Shares That May Yet Be
Purchased Under the
Plans or Programs
|
||||||||||
08/28/16 - 10/01/16
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
3,997,000
|
|
|
10/02/16 - 10/29/16
|
47,167
|
|
|
$
|
27.94
|
|
|
47,167
|
|
|
$
|
2,679,000
|
|
|
10/30/16 - 11/26/16
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
2,679,000
|
|
|
Total
|
47,167
|
|
|
$
|
27.94
|
|
|
47,167
|
|
|
$
|
2,679,000
|
|
|
3.2
|
Amended By-Laws of the Registrant previously filed with the Registrant's Current Report on Forms 8-K dated March 29, 2016 and June 16, 2016 (Commission File Number 001-06403) and incorporated by reference herein.
|
31.1
|
Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated
December 29, 2016
.
|
31.2
|
Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 dated
December 29, 2016
.
|
32.1
|
Certification by the Chief Executive Officer pursuant to Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated
December 29, 2016
.
|
32.2
|
Certification by the Chief Financial Officer pursuant to Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated
December 29, 2016
.
|
99.1
|
Loan Agreement dated as of November 8, 2016 among Winnebago Industries, Inc., Octavius Corporation, the Other Loan Party Hereto, the Lenders Party Hereto and JPMorgan Chase Bank, N.A. as Administrative Agent filed with the Registrant's Current Report on Form 8-K dated November 12, 2016 (Commission File Number 001-06403) and incorporated by reference herein.
|
99.2
|
Credit Agreement dated as of November 8, 2016 among Winnebago Industries, Inc., Winnebago of Indiana, LLC, Grand Design RV, LLC, the Other Loan Party Hereto, the Lenders Party Hereto and JPMorgan Chase Bank, N.A. as Administrative Agent filed with the Registrant's Current Report on Form 8-K dated November 12, 2016 (Commission File Number 001-06403) and incorporated by reference herein.
|
99.3
|
Intercreditor Agreement filed with the Registrant's Current Report on Form 8-K dated November 8, 2016 (Commission File Number 001-06403) and incorporated by reference herein.
|
99.4
|
Lease Agreement (Main Facility) between Three Oaks, LLC and Grand Design RV, LLC dated November 8, 2016
|
99.5
|
Lease Agreement (Expansion Facility) between Three Oaks, LLC and Grand Design RV, LLC dated November 12, 2016
|
101.INS*
|
XBRL Instance Document
|
101.SCH*
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
XBRL Taxonomy Extension Definitions Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
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WINNEBAGO INDUSTRIES, INC.
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Date:
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December 29, 2016
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By
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/s/ Michael J. Happe
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Michael J. Happe
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Chief Executive Officer, President
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(Principal Executive Officer)
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Date:
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December 29, 2016
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By
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/s/ Sarah N. Nielsen
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Sarah N. Nielsen
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Vice President, Chief Financial Officer, Treasurer
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(Principal Financial and Accounting Officer)
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1.
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I have reviewed this Quarterly Report on Form 10-Q of Winnebago Industries, Inc. (the "Registrant");
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2.
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Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
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3.
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Based on my knowledge, the financial statements and other financial information included in this Report fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
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4.
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The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
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a.
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
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b.
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
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d.
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disclosed in this Report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's
first
fiscal quarter in this case) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
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5.
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The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of Registrant's Board of Directors (or persons performing the equivalent functions):
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a.
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involved management or other employees who have a significant role in the Registrant's internal control over financial reporting.
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Date:
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December 29, 2016
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By:
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/s/ Michael J. Happe
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Michael J. Happe
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Chief Executive Officer, President
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1.
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I have reviewed this
Quarterly
Report on Form 10-Q of Winnebago Industries, Inc. (the "Registrant");
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2.
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Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
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3.
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Based on my knowledge, the financial statements and other financial information included in this Report fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
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4.
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The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
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a.
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designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
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b.
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designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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c.
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evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
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d.
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disclosed in this Report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal quarter (the Registrant's
first
fiscal quarter in this case) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
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5.
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The Registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant's auditors and the audit committee of Registrant's Board of Directors (or persons performing the equivalent functions):
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a.
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all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize and report financial information; and
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b.
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any fraud, whether or not material, that involved management or other employees who have a significant role in the Registrant's internal control over financial reporting.
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Date:
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December 29, 2016
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By:
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/s/ Sarah N. Nielsen
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Sarah N. Nielsen
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Vice President, Chief Financial Officer
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a.
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This
Quarterly
Report on Form 10-Q (“periodic report”) of Winnebago Industries, Inc. (the “issuer”), for the fiscal quarter ended
November 26, 2016
as filed with the Securities and Exchange Commission on the date of this certificate, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and
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b.
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the information contained in this periodic report fairly represents, in all material respects, the financial condition and results of operations of the issuer.
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Date:
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December 29, 2016
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By:
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/s/ Michael J. Happe
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Michael J. Happe
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Chief Executive Officer, President
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a.
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This Quarterly Report on Form 10-Q (“periodic report”) of Winnebago Industries, Inc. (the “issuer”), for the fiscal quarter ended
November 26, 2016
as filed with the Securities and Exchange Commission on the date of this certificate, which this statement accompanies, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and
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b.
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the information contained in this periodic report fairly represents, in all material respects, the financial condition and results of operations of the issuer.
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Date:
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December 29, 2016
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By:
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/s/ Sarah N. Nielsen
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Sarah N. Nielsen
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Vice President, Chief Financial Officer
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Three Oaks, LLC
22245 Sunset Lane
Middlebury, IN 46540
Attention: Don Clark, President
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Grand Design RV, LLC
11333 County Road 2
Middlebury, IN 46540
Attention: Don Clark, President
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“LANDLORD”
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THREE OAKS, LLC
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By:
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Printed Name: Don Clark
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Its:
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President
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“TENANT”
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GRAND DESIGN RV, LLC
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By:
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Printed Name: Don Clark
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Its:
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President
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STATE OF indiana
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)
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)
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SS
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COUNTY OF elkhart
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)
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My Commission Expires:
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_____________________
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_______________________________, Notary Public
Residing in ____________ County, ________________
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STATE OF INDIANA
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)
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)
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SS
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COUNTY OF ELKHART
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)
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My Commission Expires:
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_____________________
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_______________________________, Notary Public
Residing in ____________ County, ________________
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Three Oaks, LLC
358 S. Elkhart Avenue, Suite 200
Elkhart, IN 46516
Attention: Don Clark, President
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Grand Design RV, LLC
11333 County Road 2
Middlebury, IN 46540
Attention: Don Clark, President
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“LANDLORD”
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THREE OAKS, LLC
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By:
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Printed Name: Don Clark
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Its:
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President
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“TENANT”
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GRAND DESIGN RV, LLC
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By:
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Printed Name: Don Clark
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Its:
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President
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STATE OF INDIANA
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)
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)
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SS
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COUNTY OF ELKHART
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)
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My Commission Expires:
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_____________________
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_______________________________, Notary Public
Residing in ____________ County, ________________
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STATE OF INDIANA
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)
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)
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SS
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COUNTY OF ELKHART
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)
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My Commission Expires:
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_____________________
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_______________________________, Notary Public
Residing in ____________ County, ________________
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