Skyline Champion Corp - FORM 8-K - EX-99.1

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8-K - FORM 8-K - Skyline Champion Corp	d523305d8k.htm

Exhibit 99.1


		NEWS RELEASE

Skyline Corporation

2520 By-Pass Road

P.O. Box 743

Elkhart, Indiana 46515-0743

(574) 294-6521


Subject: SECOND QUARTER REPORT		Approved by: JON S. PILARSKI

ELKHART, INDIANA — JANUARY 11, 2018

SKYLINE REPORTS SECOND QUARTER AND FIRST HALF RESULTS

For the second quarter of fiscal 2018, Skyline Corporation (NYSE MKT: SKY) (“Skyline” or the “Corporation”) reported the following results:

•

Net sales of $57,765,000, a decrease of 10.1% over net sales of $64,226,000 from the year ago quarter. The decrease is mainly due to prior period net manufactured housing sales including $8,092,000 attributable to facilities in Elkhart, Indiana and Mansfield, Texas which closed in the fourth quarter of fiscal 2017. Modular housing net sales partially offset the decrease as a result of multiple facilities experiencing increased customer demand for this product.

•

Operating income for fiscal 2018 was $3,001,000 as compared to an operating loss of $509,000 for fiscal 2017. Current year operating income includes a $762,000 net gain on the sale of property, plant and equipment. Prior year’s operating loss included a $1,362,000 loss, excluding corporate overhead allocation, attributable to the Elkhart and Mansfield facilities.

•

Net income of $2,964,000 or $0.35 per share as compared to a net loss of $595,000 or $0.07 per share in the second quarter of fiscal 2017. Included in current year income is a net gain on sale of property, plant and equipment of $762,000.

For the first half of fiscal 2018, the Corporation reported the following results:

•

Net sales of $116,227,000, a decrease of 7.3% over net sales of $125,402,000 from the year ago first half. The decrease is mainly due to prior period net manufactured housing sales including $13,293,000 attributable to the Elkhart and Mansfield facilities. Modular housing net sales partially offset the decrease as a result of multiple facilities experiencing increased customer demand for this product. In addition, park model net sales rose as a result of management’s continuing initiative to increase this product’s exposure at substantially all of the Corporation’s facilities.

•

Operating income for fiscal 2018 was $4,755,000 as compared to operating income of $321,000 for fiscal 2017. Current year operating income includes a $702,000 net gain on the sale of property, plant and equipment. Prior year’s operating income included a $2,517,000 loss, excluding corporate overhead allocation, attributable to the Elkhart and Mansfield facilities.

•

Net income of $4,571,000 or $0.54 per share as compared to a net income of $149,000 or $0.02 per share in the six months of fiscal 2017. Included in current year income is a net gain on sale of property, plant and equipment of $702,000.


Bringing America Home.		Bringing America Fun.

Skyline Corporation and Subsidiary Companies

Consolidated Balance Sheets

(Dollars in thousands)


	December 3, 2017			May 31, 2017
	(Unaudited)
Current Assets:
Cash	$	12,287		$	11,384
Accounts receivable		14,802			12,751
Inventories		12,929			12,233
Workers’ compensation security deposit		371			371
Other current assets		995			563


Total Current Assets		41,384			37,302


Property, Plant and Equipment, at Cost:
Land		2,016			2,965
Buildings and improvements		35,615			35,368
Machinery and equipment		16,872			16,364

		54,503			54,697
Less accumulated depreciation		44,092			43,721

		10,411			10,976
Other Assets		7,242			7,366


Total Assets	$	59,037		$	55,644


Current Liabilities:
Accounts payable, trade	$	4,056		$	3,861
Accrued salaries and wages		2,942			3,530
Accrued marketing programs		3,220			1,986
Accrued warranty		3,916			4,757
Customer deposits		1,977			1,880
Other accrued liabilities		2,596			2,371


Total Current Liabilities		18,707			18,385


Long-Term Liabilities:
Deferred compensation expense		4,808			4,848
Accrued warranty		2,800			2,800
Life insurance loans		2,707			4,312


Total Long-Term Liabilities		10,315			11,960


Shareholders’ Equity:
Common stock, $.0277 par value, 15,000,000 shares
authorized; issued 11,217,144 shares		312			312
Additional paid-in capital		5,316			5,171
Retained earnings		90,131			85,560
Treasury stock, at cost, 2,825,900 shares		(65,744	)		(65,744	)

Total Shareholders’ Equity		30,015			25,299


Total Liabilities and Shareholders’ Equity	$	59,037		$	55,644

Skyline Corporation and Subsidiary Companies

Consolidated Income Statements

For the Three-Months and Six-Months Ended December 3, 2017 and November 30, 2016

(Dollars in thousands, except share and per share amounts)


	Three-Months Ended						Six-Months Ended
	2017			2016			2017			2016
	(Unaudited)						(Unaudited)
OPERATIONS
Net sales	$	57,765		$	64,226		$	116,227		$	125,402
Cost of sales		49,394			58,996			99,930			113,592

Gross profit		8,371			5,230			16,297			11,810
Selling and administrative expenses		6,132			5,739			12,244			11,489
Net gain on sale of property, plant and equipment		762			—			702			—

Operating income (loss)		3,001			(509	)		4,755			321
Interest expense		(37	)		(86	)		(184	)		(172	)
Income tax expense		—			—			—			—

Net income (loss)	$	2,964		$	(595	)	$	4,571		$	149

Basic and diluted income (loss) per share	$	.35		$	(.07	)	$	.54		$	.02

Weighted average number of common shares outstanding:
Basic		8,391,244			8,391,244			8,391,244			8,391,244

Diluted		8,562,899			8,391,244			8,531,191			8,512,903

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