Thor Industries, the recreational vehicle (RV) maker based in Elkhart, Indiana, experienced a decline in sales and profit during its fiscal first quarter. However, there are signs that the pace of sales declines is slowing down, indicating a positive development in the industry.
In the three months ending on October 31, Thor Industries reported a profit of $53.6 million, or 99 cents a share. This is down from $136.2 million, or $2.53 a share, in the same period last year. Although the company’s profit has decreased, it still exceeded analysts’ expectations of 98 cents per share.
Sales also saw a decline of nearly 20% to $2.5 billion, which was in line with analysts’ projections. Nevertheless, this marks a smaller decline compared to the previous four quarters.
Chief Executive Bob Martin attributed the decrease in shipments to dealerships’ efforts to reduce their aging inventory as well as lower production, especially within the European market. To address this issue, Thor deliberately kept production levels below retail demand during the quarter. This strategy aimed to clear the market of older models and prepare for the introduction of new value-focused models in 2024. These new models are expected to stimulate demand and address affordability challenges.
In summary, Thor Industries faced a decrease in sales and profit in its fiscal first quarter. However, the company is taking strategic measures to navigate through the industry slowdown and is optimistic about its future with the upcoming introduction of value-focused models.