Shares of Winnebago Industries (WGO) - Get Report dropped 1.3% to $38.08 Wednesday as falling sales caused the recreational vehicle and marine products maker to miss Wall Street's third-quarter revenue expectations.
The Forest City, Iowa-based company reported net income of $36.2 million, or $1.14 a share, up from $32.5 million, or $1.02 a share, a year ago and ahead analysts' expectations of $1 a share. The results include a 6-cents-per-share benefit from tax reform.
Revenue fell 5.9% to $528.9 million, missing Wall Street's forecast of $569.4 million. Motorhome revenue fell 34.6% to $160.2 million, while towable revenue increased 10.8% to $346.8 million.
Winnebago said that the motorhome segment's revenue loss was driven by decreases in both Class C and Class A unit sales as dealers continue to lower their inventories.
Michael Happe, president and CEO, said the results were "a testament to the strength and resiliency of our brand portfolio amid a challenging and highly competitive RV market."
"We continue to focus on manufacturing high-quality products, maintaining disciplined production management and enhancing channel relationships," he said. "Despite a moderate decrease in overall sales in a difficult RV wholesale market, consolidated margin continued to expand, primarily due to the strength of our dual-branded Towable segment. We continue to be pleased with our strengthened market position as we outperform the industries in which we compete."