Winnebago Industries, Inc. (NYSE:WGO) Q3 2019 Earnings Conference Call Transcript

Jun 19, 2019 • 10:00 am ET

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Winnebago Industries, Inc. (NYSE:WGO) Q3 2019 Earnings Conference Call Transcript

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Q & A
Operator
Operator

Thank you. (Operator Instructions) Our first question comes from Craig Kennison with Baird. Your line is now open.

Analyst
Craig Kennison

Good morning, and thanks for taking my questions. A lot of good detail on the call. Wanted to dig into the retail commentary, since that's an issue everyone's focused on. I know weather has been a factor, there's no doubt about that. But what can you tell us about May and June so far in, especially these northern markets that might shed more light on that dynamic?

Executive
Michael J. Happe

Yeah, good morning, Craig. This is Mike. Certainly, I think summer has begun in several parts of -- the northern parts of the country. There has been quite a bit of rain and moisture in certain places. But I think we generally feel better about the summer selling season here in the last several weeks. The variability of retail is probably the best way I would describe it, the variability of the retail has settled down, and it has been performing on a more consistent basis going forward.

As you know, we represent only today about 9% to 10% of the total industry. So, like many of you in the industry, we don't get to see some of the formal data as well for a while. But the spring was particularly tough. We don't use that as an excuse. We didn't even attempt to quantify it on this morning's call. But if you talk to dealers and even, again, homeowners or end customers, they -- all of them will generally say that in most parts of the country, it wasn't the greatest of springs and summer got off to a little bit later start. So, as you know, we're a very seasonally retail driven business. It's important that we see good retail here over the next several months, so that the dealers as they go into the open house event in the RV industry in September are in a good position to consider a good reorder position at that particular event.

Analyst
Craig Kennison

Thanks. And then, in your prepared remarks, you talked about the backlog and also order trends. The backlog did deteriorate, but you seem comfortable with the pace of orders. How do you sort of reconcile all of that and is the answer basically, you're taking share?

Executive
Michael J. Happe

Yeah. You know, at the end of the day, retail performance is, for us, the ultimate market metric and we feel confident that as long as -- in certain parts of our business very specifically, as examples, Grand Design RV and our Winnebago-branded Class B Motorized segment, as long as consumers continue to choose our brands in those categories more than other brands that the orders will follow.

I think you've heard this from other manufacturers Craig, but during the run up in this past decade of RV wholesale shipments, you saw many dealers putting orders and over an extended period of time, they were ordering products, three months out, six months out, potential even farther. Certainly, with the