UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 28, 2024
or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 001-04714
Champion Homes, Inc.
(Exact name of registrant as specified in its charter)
Indiana
35-1038277
(State of Incorporation)
(I.R.S. Employer Identification No.)
755 West Big Beaver Road, Suite 1000
Troy, Michigan
48084
(Address of Principal Executive Offices)
(Zip Code)
(248) 614-8211
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock
SKY
New York Stock Exchange
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filers,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:):
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
Number of shares of common stock outstanding as of January 31, 2025: 57,275,954
CHAMPION HOMES, INC.
TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of December 28, 2024 (unaudited) and March 30, 2024
1
Condensed Consolidated Income Statements (unaudited) for the three and nine months ended December 28, 2024 and December 30, 2023
2
Condensed Consolidated Statements of Comprehensive Income (unaudited) for the three and nine months ended December 28, 2024 and December 30, 2023
3
Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months ended December 28, 2024 and December 30, 2023
4
Condensed Consolidated Statements of Stockholders’ Equity (unaudited) for the three and nine months ended December 28, 2024 and December 30, 2023
5
Notes to Condensed Consolidated Financial Statements
6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
17
Item 3. Quantitative and Qualitative Disclosures About Market Risk
30
Item 4. Controls and Procedures
PART II – OTHER INFORMATION
Item 1. Legal Proceedings
31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 5. Other Information
Item 6. Exhibits
32
SIGNATURES
33
i
EXPLANATORY NOTE
On August 5, 2024, Skyline Champion Corporation changed its name to Champion Homes, Inc., which we refer to in this Quarterly Report on Form 10-Q as the “name change.” Unless the context otherwise requires, references herein to the “Company,” “we,” “us,” or “our” refer to Skyline Champion Corporation for periods ending on or before the name change and to Champion Homes, Inc. for any references to the Company after the name change.
ii
PART I - FINANCIAL INFORMATION
Item 1.Financial Statements
Condensed Consolidated Balance Sheets
(Dollars and shares in thousands, except per share amounts)
December 28, 2024
March 30, 2024
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
581,753
495,063
Trade accounts receivable, net
68,441
64,632
Inventories, net
336,766
318,737
Other current assets
33,721
39,870
Total current assets
1,020,681
918,302
Long-term assets:
Property, plant, and equipment, net
304,166
290,930
Goodwill
357,973
Amortizable intangible assets, net
67,601
76,369
Deferred tax assets
29,644
26,878
Other noncurrent assets
257,404
252,889
Total assets
2,037,469
1,923,341
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Floorplan payable
88,198
91,286
Accounts payable
44,695
50,820
Other current liabilities
261,269
247,495
Total current liabilities
394,162
389,601
Long-term liabilities:
Long-term debt
24,696
24,669
Deferred tax liabilities
7,088
6,905
Other liabilities
83,224
79,796
Total long-term liabilities
115,008
111,370
Stockholders' Equity:
Common stock, $0.0277 par value, 115,000 shares authorized, 57,198 and 57,815 shares issued as of December 28, 2024 and March 30, 2024, respectively
1,587
1,605
Additional paid-in capital
582,673
568,203
Retained earnings
965,008
866,485
Accumulated other comprehensive loss
(20,969
)
(13,923
Total stockholders’ equity
1,528,299
1,422,370
Total liabilities and stockholders’ equity
See accompanying Notes to Condensed Consolidated Financial Statements.
Condensed Consolidated Income Statements
(Unaudited, dollars in thousands, except per share amounts)
Three months ended
Nine months ended
December 30, 2023
Net sales
644,925
559,455
1,889,581
1,488,460
Cost of sales
463,903
418,183
1,378,011
1,101,026
Gross profit
181,022
141,272
511,570
387,434
Selling, general, and administrative expenses
108,214
85,091
316,696
219,984
Operating income
72,808
56,181
194,874
167,450
Interest (income), net
(3,991
(4,309
(12,977
(24,090
Other (income) expense
(2,158
756
(3,363
2,821
Income before income taxes
78,957
59,734
211,214
188,719
Income tax expense
16,698
12,764
45,809
44,811
Net income before equity in net loss of affiliates
62,259
46,970
165,405
143,908
Equity in net (income) loss of affiliates
(568
—
1,466
Net income
62,827
163,939
Net (income) attributable to non-controlling interest
(1,290
(1,874
Net income attributable to Champion Homes, Inc.
61,537
162,065
Net income attributable to Champion Homes, Inc. per share:
Basic
1.07
0.81
2.81
2.51
Diluted
1.06
2.79
2.49
Condensed Consolidated Statements of Comprehensive Income
(Unaudited, dollars in thousands)
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments
(7,540
2,408
(7,046
2,476
Total other comprehensive income (loss)
Total comprehensive income before non-controlling interests
55,287
49,378
156,893
146,384
Comprehensive (income) attributable to non-controlling interests
Comprehensive income attributable to Champion Homes, Inc.
53,997
155,019
Condensed Consolidated Statements of Cash Flows
Cash flows from operating activities
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
30,796
24,017
Amortization of deferred financing fees
280
255
Equity-based compensation
14,184
15,231
Deferred taxes
(2,464
(3,115
Loss on disposal of property, plant, and equipment
128
145
Foreign currency transaction loss (gain)
1,436
(184
Equity in net loss of affiliates
217
Dividends from equity method investment
1,011
Change in fair value of contingent consideration
7,912
Change in assets and liabilities:
Accounts receivable
(3,858
39,340
Floor plan receivables
(16,874
(4,978
Inventories
(18,902
47,696
Other assets
8,045
(10,756
(4,762
(15,309
Accrued expenses and other liabilities
12,515
(17,850
Net cash provided by operating activities
194,852
218,617
Cash flows from investing activities
Additions to property, plant, and equipment
(37,971
(40,986
Cash paid for equity method investment
(2,250
Cash paid for investment in ECN common stock
(78,858
Cash paid for investment in ECN preferred stock
(64,520
Investment in floor plan loans
(18,466
Proceeds from floor plan loans
2,737
14,646
Acquisitions, net of cash acquired
(284,545
Proceeds from disposal of property, plant, and equipment
222
556
Net cash (used) in investing activities
(35,012
(474,423
Cash flows from financing activities
Changes in floor plan financing, net
(3,089
4,474
Payments on long term debt
(20
(67
Payments on repurchase of common stock
(59,999
Stock option exercises
285
506
Tax payments for equity-based compensation
(3,031
(983
Net cash (used in) provided by financing activities
(65,854
3,930
Effect of exchange rate changes on cash and cash equivalents
(7,296
2,330
Net increase (decrease) in cash and cash equivalents
86,690
(249,546
Cash and cash equivalents at beginning of period
747,453
Cash and cash equivalents at end of period
497,907
Condensed Consolidated Statements of Stockholders’ Equity
(Unaudited, dollars and shares in thousands)
Three months ended December 28, 2024
Shares
Amount
AdditionalPaid inCapital
RetainedEarnings
AccumulatedOtherComprehensiveLoss
Non-Controlling Interest
Total
Balance at September 28, 2024
57,384
1,592
579,685
924,408
(13,429
1,492,256
1,290
2,971
Net common stock issued under equity-based compensation plans
19
(761
(743
Common stock repurchases
(205
(6
(20,176
(20,182
Distributions declared payable to non-controlling interest
Balance at December 28, 2024
57,198
Nine months ended December 28, 2024
Balance at March 30, 2024
57,815
1,874
94
286
(2,742
(711
(21
(60,511
(60,532
Three months ended December 30, 2023
Balance at September 30, 2023
57,162
530,645
821,628
(13,667
1,340,193
4,288
247
Common stock issued for business combination
455
13
27,839
27,852
Balance at December 30, 2023
57,636
1,600
563,019
868,598
(11,259
1,421,958
Nine months ended December 30, 2023
Balance at April 1, 2023
57,108
1,585
519,479
725,672
(13,735
1,233,001
73
470
(982
(510
Components of accumulated other comprehensive loss consisted solely of foreign currency translation adjustments.
1.Basis of Presentation and Business
Nature of Operations: The operations of Champion Homes, Inc., formerly known as Skyline Champion Corporation (the “Company”), consist of manufacturing, retail, construction services, and transportation activities. At December 28, 2024, the Company operated 43 manufacturing facilities throughout the United States (“U.S.”) and 5 manufacturing facilities in western Canada that primarily construct factory-built, timber-framed manufactured and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 72 sales centers that sell manufactured houses to consumers across the U.S. The Company's construction services business provides installation and set-up services of factory-built homes. The Company’s transportation business engages independent owners/drivers to transport recreational vehicles throughout the U.S. and Canada and manufactured houses in certain regions of the U.S.
Basis of Presentation: The accompanying unaudited condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Quarterly Reports on Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations.
The condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries after elimination of intercompany balances and transactions. In the opinion of management, these statements include all normal recurring adjustments necessary to fairly state the Company’s consolidated results of operations, cash flows, and financial position. The Company has evaluated subsequent events after the balance sheet date through the date of the filing of this report with the SEC. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on May 29, 2024 (the “Fiscal 2024 Annual Report”).
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes thereto. Actual results could differ from those estimates. The condensed consolidated income statements, condensed consolidated statements of comprehensive income, and condensed consolidated statements of cash flows for the interim periods are not necessarily indicative of the results of operations or cash flows for the full year.
The Company’s fiscal year is a 52- or 53-week period that ends on the Saturday nearest to March 31. The Company’s current fiscal year, “fiscal 2025,” will end on March 29, 2025 and will include 52 weeks. References to “fiscal 2024” refer to the Company’s fiscal year ended March 30, 2024. The three and nine months ended December 28, 2024 and December 30, 2023 each included 13 weeks and 39 weeks, respectively.
The Company’s allowance for credit losses on financial assets measured at amortized cost reflects management’s estimate of credit losses over the remaining expected life of such assets, measured primarily using historical experience, as well as current economic conditions and forecasts that affect the collectability of the reported amount. Expected credit losses for newly recognized financial assets, as well as changes to expected credit losses during the period, are recognized in earnings. Accounts receivable are reflected net of reserves of $2.1 million and $1.9 million at December 28, 2024 and March 30, 2024, respectively.
Floor plan receivables consist primarily of amounts loaned by the Company through Triad Financial Services, Inc. ("Triad") to certain independent retailers for purchases of homes manufactured by the Company, of which $32.2 million and $18.1 million was outstanding at December 28, 2024 and March 30, 2024, respectively. Floor plan receivables are carried net of payments received and recorded at amortized cost. The Company intends to hold the floor plan receivables until maturity or payoff. These loans are serviced by Triad, to which we pay a servicing fee. Upon execution of the financing arrangement, the floor plan loans are generally payable at the earlier of the sale of the underlying home or two years from the origination date. Floor plan receivables are included in other current assets and other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets.
The floor plan receivables are collateralized by the related homes, mitigating loss exposure. The Company and Triad evaluate the credit worthiness of each independent retailer prior to credit approval, including reviewing the independent retailer’s payment history, financial condition, and the overall economic environment. The Company evaluates the risk of credit loss in aggregate on existing loans with similar terms, based on historic experience and current economic conditions, as well as individual retailers with past due balances or other indications of heightened credit risk. The allowance for credit losses related to floor plan receivables was not material as of December 28, 2024 or March 30, 2024. Loans are considered past due if any required interest or curtailment payment remains unpaid 30 days after the due date. Receivables are placed on non-performing status if any interest or installment payments are past due over 90 days. Loans are placed on nonaccrual status when interest payments are past due over 90 days. At December 28, 2024, there were no floor plan receivables on nonaccrual status and the weighted-average age of the floor plan receivables was six months.
Notes to Condensed Consolidated Financial Statements - Continued
Interest income from floor plan receivables is recognized on an accrual basis and is included in interest income in the accompanying Condensed Consolidated Income Statements. Interest income from floor plan receivables for the three months ended December 28, 2024 and December 30, 2023 was $0.7 million and $0.3 million, respectively. Interest income from floor plan receivables for the nine months ended December 28, 2024 and December 30, 2023 was $1.7 million and $0.9 million, respectively.
Recently issued accounting pronouncements: In November 2023, the FASB issued Accounting Standards Update ("ASU") 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which expands disclosures about a public entity’s reportable segments and requires more enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how a public entity’s chief operating decision maker uses reported segment profit or loss information in assessing segment performance and allocating resources. The update will be effective for annual periods beginning after December 15, 2023 (fiscal 2025). We are assessing the effect of this update on our consolidated financial statement disclosures.
In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which expands disclosures in an entity’s income tax rate reconciliation table and regarding cash taxes paid both in the U.S. and foreign jurisdictions. The update will be effective for annual periods beginning after December 15, 2024 (fiscal 2026). We are assessing the effect of this update on our consolidated financial statement disclosures.
In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which expands disclosures about a public entity's specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The update will be effective for annual periods beginning after December 15, 2026 (fiscal 2028). We are assessing the effect of this update on our consolidated financial statement disclosures.
2.Business Combinations
Regional Homes Acquisition
On October 13, 2023, the Company acquired all of the outstanding equity interests in Regional Enterprises, LLC and related companies (collectively, "Regional Homes") for total purchase consideration of $316.9 million, net of assumed indebtedness and working capital adjustments. The purchase consideration consisted of net cash of $279.5 million, the issuance of 455,098 shares of common stock equal to approximately $27.9 million, and contingent consideration with an estimated fair value of $5.9 million. The contingent consideration is related to an earnout provision in the event certain conditions are met per the terms of the purchase agreement, with a maximum earnout amount of $25.0 million. The initial fair value of the earnout was established using a Monte Carlo simulation method and the resulting liability is recorded in other liabilities in the accompanying Condensed Consolidated Balance Sheets. In the first quarter of fiscal 2025, the method and timing of measuring the earnout was amended, which resulted in a charge of $7.9 million which is reflected in selling, general, and administrative expense in the accompanying Condensed Consolidated Income Statements. The Company accounted for the acquisition as a business combination under the acquisition method of accounting provided by FASB ASC 805, Business Combinations ("ASC 805"). As such, the purchase price was allocated to the net assets acquired, inclusive of intangible assets, with the excess fair value recorded to goodwill.
7
The following table presents the consideration transferred and the purchase price allocation:
Description
Fair value of consideration transferred
Fair value of Champion Homes, Inc. common stock issued as consideration (455,098 shares at $61.20)
Cash consideration, net of cash acquired
279,545
Working capital adjustment
3,644
Estimated earn out consideration
5,904
Total consideration
316,945
Purchase price allocations:
Trade accounts receivable
16,300
138,933
3,002
86,174
41,800
10,640
Floor plan payable
(75,916
(14,427
(35,662
(12,233
(3,065
Identifiable net assets acquired
155,546
161,399
Total purchase price
Trade accounts receivable, other assets, floor plan and accounts payable, long-term debt and other liabilities are generally stated at historical carrying values as they approximate fair value. Retail inventories are reflected at manufacturer wholesale prices. Intangible assets include $16.9 million in customer relationships and $24.9 million in trade names and are based on an independent appraisal. The fair value of customer relationships was determined using the multi-period excess earnings method and fair value of the trade name was determined using the relief-from-royalty method. The Company estimated that each intangible asset has a weighted average useful life of ten years from the acquisition date. Fair value estimates of property, plant, and equipment were based on independent appraisals, giving consideration to the highest and best use of the assets. Key assumptions used in the appraisals were drawn from a combination of market, cost, and sales comparison approaches, as appropriate. Level 3 fair value estimates of $86.2 million related to property, plant, and equipment and $41.8 million related to intangible assets were recorded in the accompanying consolidated balance sheet as of the acquisition date. For further information on acquired assets measured at fair value, see Note 5, Goodwill, Intangible Assets and Cloud Computing Arrangements.
The acquisition of Regional Homes was a taxable business combination. Therefore, the Company’s tax basis in the assets acquired and the liabilities assumed approximate the respective fair values at the acquisition date.
The following unaudited pro forma information presents a summary of the operating results for the three and nine months ended December 30, 2023, as if the acquisition of Regional Homes had been completed on April 3, 2022, which is the beginning of the comparable reporting period from the acquisition date:
Pro forma net sales
568,045
1,750,936
Pro forma net income
47,058
159,351
8
3.Inventories, net
The components of inventory, net of reserves for obsolete inventory, were as follows:
(Dollars in thousands)
Raw materials
106,268
101,429
Work in process
29,724
23,436
Finished goods and other
200,774
193,872
Total inventories, net
At December 28, 2024 and March 30, 2024, reserves for obsolete inventory were $9.5 million and $10.1 million, respectively.
4.Property, Plant, and Equipment
Property, plant, and equipment are stated at cost. Depreciation is calculated primarily on a straight-line basis, generally over the following estimated useful lives: land improvements – 3 to 10 years; buildings and improvements – 8 to 25 years; and vehicles and machinery and equipment – 3 to 8 years. Depreciation expense for the three months ended December 28, 2024 and December 30, 2023 was $7.8 million and $6.9 million, respectively. Depreciation expense for the nine months ended December 28, 2024 and December 30, 2023 was $22.0 million and $16.2 million, respectively.
The components of property, plant, and equipment were as follows:
Land and improvements
77,941
72,188
Buildings and improvements
194,690
183,109
Machinery and equipment
158,664
142,870
Construction in progress
21,880
20,469
Property, plant, and equipment, at cost
453,175
418,636
Less: accumulated depreciation
(149,009
(127,706
5.Goodwill, Intangible Assets, and Cloud Computing Arrangements
Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. At both December 28, 2024 and March 30, 2024, the Company had goodwill of $358.0 million. Goodwill is allocated to reporting units included in the U.S. Factory-built Housing segment, which include the Company’s U.S. manufacturing and retail operations. At December 28, 2024, there were no accumulated impairment losses related to goodwill.
Intangible Assets
The components of amortizable intangible assets were as follows:
CustomerRelationships& Other
TradeNames
Gross carrying amount
82,597
46,267
128,864
82,909
46,393
129,302
Accumulated amortization
(45,053
(16,210
(61,263
(39,825
(13,108
(52,933
Amortizable intangibles, net
37,544
30,057
43,084
33,285
During the three months ended December 28, 2024 and December 30, 2023, amortization of intangible assets was $2.9 million and $2.8 million, respectively. During the nine months ended December 28, 2024 and December 30, 2023, amortization of intangible assets was $8.8 million and $7.8 million, respectively.
9
Cloud Computing Arrangements
The Company capitalizes costs associated with the development of cloud computing arrangements in a manner consistent with internally developed software. At December 28, 2024 and March 30, 2024, the Company had capitalized cloud computing costs, net of amortization of $24.0 million and $25.7 million, respectively. Cloud computing costs are included in other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets. Amortization of capitalized cloud computing costs for the three months ended December 28, 2024 and December 30, 2023 was $1.0 million and $0.3 million, respectively. Amortization of capitalized cloud computing costs for the nine months ended December 28, 2024 and December 30, 2023 was $1.7 million and $0.7 million, respectively.
6. Investment in ECN Capital Corporation
In September 2023, the Company entered into a share subscription agreement with ECN Capital Corp. ("ECN") and made a $137.8 million equity investment in ECN on a private placement basis. The Company purchased 33.6 million common shares, representing approximately 12% of the total outstanding common shares of ECN, and 27.5 million mandatory convertible preferred shares (the “Preferred Shares”). The Preferred Shares receive cumulative cash dividends at an annual rate of 4.0%. Following the private placement, the Company owns approximately 19.9% of the voting shares of ECN. In connection with the share subscription agreement, the Company and Triad formed Champion Financing LLC ("Champion Financing"), a captive finance company that is 51% owned by the Company and 49% owned by Triad. The results of Champion Financing are included in the consolidated results of the Company on a three-month lag. Triad's 49% ownership interest is reflected as non-controlling interest in the Condensed Consolidated Income Statements.
The Company's interest in the common stock investment in ECN is accounted for under the equity method and the Company’s share of the earnings or losses of ECN are recorded on a three-month lag. For the three months ended December 28, 2024, the Company's share of ECN's earnings was $0.7 million. For the nine months ended December 28, 2024, the Company's share of ECN's earnings was $0.1 million. For the three and nine months ended December 30, 2023, the Company's share of ECN's losses was $0.2 million. Dividends received on the investment in common stock of ECN are reflected as a reduction to the investment balance and are presented on the Condensed Consolidated Statements of Cash Flows using the nature of the distribution approach. At December 28, 2024 and March 30, 2024, the investment in the common stock of ECN totaled $71.0 million and $71.9 million, respectively, and is included in other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets. The aggregate value of the Company’s investment in the common stock of ECN based on the quoted market price of ECN’s common stock at December 28, 2024 was approximately $73.0 million. We assess our investment in ECN common stock for other than temporary impairment on a quarterly basis or when events or circumstances suggest that the carrying amount of the investment may be impaired.
The Company's investment in the Preferred Shares is included in other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets. The investment is measured using the measurement alternative for equity investments without a readily determinable fair value. At December 28, 2024 and March 30, 2024, the investment in the Preferred Shares was $64.5 million. There have been no adjustments to the carrying amount or impairment of the investment. For the three and nine months ended December 28, 2024, the Company reflected dividend income from the investment in the Preferred Shares of $1.2 million and $2.4 million, respectively, in other income on the accompanying Condensed Consolidated Income Statements. For the three and nine months ended December 30, 2023, the Company reflected dividend income from the investment in the Preferred Shares of $0.6 million in other income on the accompanying Condensed Consolidated Income Statements.
Triad, a related party through its parent ECN, provides loan servicing for the Company's floor plan receivables. The Company pays Triad a fee for servicing loans which was not material for the three and nine months ended December 28, 2024 and December 30, 2023, respectively. Triad also provides floor plan financing of the Company's products to Company-owned and independent retailers. At December 28, 2024, the Company had floor plan payables due to Triad of $31.9 million. At December 28, 2024, the Company had repurchase commitments of $118.5 million on independent retailer floor plan loans outstanding with Triad.
10
7.Other Current Liabilities
The components of other current liabilities were as follows:
Customer deposits
68,363
80,833
Accrued volume rebates
28,774
21,169
Accrued warranty obligations
44,446
39,176
Accrued compensation and payroll taxes
45,680
35,063
Accrued insurance
15,138
12,772
Accrued product liability - water intrusion
34,400
34,500
Other
24,468
23,982
Total other current liabilities
8.Accrued Warranty Obligations
Changes in the accrued warranty obligations were as follows:
Balance at beginning of period
55,688
37,362
50,869
35,961
Warranty expense
16,762
17,494
53,581
45,327
Acquired warranty obligations
11,043
Cash warranty payments
(16,311
(15,833
(48,311
(42,265
Balance at end of period
56,139
50,066
Less: noncurrent portion in other long-term liabilities
(11,693
(9,385
Total current portion
40,681
9.Debt and Floor Plan Payable
Long-term debt consisted of the following:
Obligations under industrial revenue bonds due 2029
12,430
Notes payable to Romeo Juliet, LLC, due 2026
5,314
Notes payable to Romeo Juliet, LLC, due 2039
2,036
Note payable to United Bank, due 2026
4,916
4,889
Revolving credit facility maturing in 2026
Total long-term debt
On July 7, 2021, the Company entered into an Amended and Restated Credit Agreement with a syndicate of banks that provides for a revolving credit facility of up to $200.0 million, including a $45.0 million letter of credit sub-facility ("Amended Credit Agreement"). The Amended Credit Agreement replaced the Company's previously existing $100.0 million revolving credit facility. The Amended Credit Agreement allows the Company to draw down, repay and re-draw loans on the available funds during the term, subject to certain terms and conditions, matures in July 2026, and has no scheduled amortization.
On May 18, 2023, the Company further amended the Amended Credit Agreement, which removed references to the London Interbank Offer Rate ("LIBOR") and clarified language pertaining to the Secured Overnight Financing Rate ("SOFR") in regards to the interest rate on borrowings. The interest rate on borrowings under the Amended Credit Agreement is based on SOFR plus a SOFR adjustment, plus an interest rate spread. The interest rate spread adjusts based on the consolidated total net leverage of the Company from a high of 1.875% when the consolidated total net leverage ratio is equal to or greater than 2.25:1.00, to a low of 1.125% when the consolidated total net leverage ratio is below 0.50:1.00. Alternatively for same day borrowings, the interest rate is based on an Alternative Base Rate ("ABR") plus an interest rate spread that ranges from a high of 0.875% to a low of 0.125% based on the consolidated total net leverage ratio. In addition, the Company is obligated to pay an unused line fee ranging between 0.15% and 0.3% depending on the consolidated total net leverage ratio, in respect of
11
unused commitments under the Amended Credit Agreement. At December 28, 2024, the interest rate under the Amended Credit Agreement was 5.58% and letters of credit issued under the Amended Credit Agreement totaled $31.5 million. Available borrowing capacity under the Amended Credit Agreement as of December 28, 2024 was $168.5 million.
The Amended Credit Agreement contains covenants that restrict the amount of additional debt, liens and certain payments, including equity buy-backs, investments, dispositions, mergers and consolidations, among other restrictions as defined. The Company was in compliance with all covenants of the Amended Credit Agreement as of December 28, 2024.
Obligations under industrial revenue bonds are supported by letters of credit and bear interest based on a municipal bond index rate. The weighted-average interest rate at December 28, 2024, including related costs and fees, was 5.27%. The industrial revenue bonds require lump-sum payments of principal upon maturity in 2029 and are secured by the assets of certain manufacturing facilities.
As part of the acquisition of Regional Homes, the Company assumed notes payable to Romeo Juliet, LLC, a subsidiary of Wells Fargo Community Investment Holdings, Inc. ("WFC"). The weighted-average interest rate on those notes at December 28, 2024 was 5.42%. The notes are secured by certain assets of Regional Homes. In addition, the Company assumed a note payable to United Bank with an interest rate of 3.85% that is secured by a note receivable from HHB Investment Fund, LLC, a subsidiary of WFC.
Floor Plan Payable
The Company’s retail operations utilize floor plan financing to fund the purchase of manufactured homes for display or resale. At December 28, 2024 and March 30, 2024, the Company had outstanding borrowings on floor plan financing agreements of $88.2 million and $91.3 million, respectively. Total credit line capacity provided under the agreements was $223.0 million as of December 28, 2024. The weighted average interest rate on the floor plan payable was 7.14% at December 28, 2024. Borrowings are secured by the homes and are required to be repaid when the Company sells the related home to a customer.
12
10.Revenue Recognition
The following tables disaggregate the Company’s revenue by sales category:
U.S.Factory-BuiltHousing
CanadianFactory-BuiltHousing
Corporate/Other
Manufacturing
386,398
25,692
412,090
Retail
224,359
Transportation/Other
8,476
610,757
1,145,198
68,725
1,213,923
652,219
23,439
1,797,417
337,981
30,803
368,784
183,143
Transportation
7,528
521,124
1,035,235
86,179
1,121,414
342,806
24,240
1,378,041
11.Income Taxes
For the three months ended December 28, 2024 and December 30, 2023, the Company recorded $16.7 million and $12.8 million of income tax expense and had an effective tax rate of 21.1% and 21.4%, respectively. For the nine months ended December 28, 2024 and December 30, 2023, the Company recorded $45.8 million and $44.8 million of income tax expense and had an effective tax rate of 21.7% and 23.7% respectively.
The Company’s effective tax rate for the three and nine months ended December 28, 2024 and December 30, 2023, differs from the federal statutory income tax rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, and results in foreign jurisdictions.
At December 28, 2024, the Company had no unrecognized tax benefits.
12.Earnings Per Share
Basic net income per share attributable to the Company was computed by dividing net income attributable to the Company by the average number of common shares outstanding during the period. Diluted earnings per share is calculated using our weighted-average outstanding common shares, including the dilutive effect of stock awards as determined under the treasury stock method.
The following table sets forth the computation of basic and diluted earnings per common share:
(Dollars and shares in thousands, except per share data)
Numerator:
Denominator:
Basic weighted-average shares outstanding
57,407
57,644
57,640
57,364
Dilutive securities
614
492
537
478
Diluted weighted-average shares outstanding
58,021
58,136
58,177
57,842
Basic net income per share
Diluted net income per share
13.Segment Information
Financial results for the Company's reportable segments have been prepared using a management approach, which is consistent with the basis and manner in which financial information is evaluated by the Company's chief operating decision maker in allocating resources and in assessing performance. The Company’s chief operating decision maker, the Chief Executive Officer, evaluates the performance of the Company’s segments primarily based on net sales, before elimination of inter-company shipments, earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and operating assets.
The Company operates in two reportable segments: (i) U.S. Factory-built Housing, which includes manufacturing and retail housing operations and (ii) Canadian Factory-built Housing. Corporate/Other includes the Company’s transportation operations, the Company's financing activities, corporate costs directly incurred for all segments and intersegment eliminations. Segments are generally determined by geography. Segment data includes intersegment revenues and corporate office costs that are directly and exclusively incurred for each segment. Total assets for Corporate/Other primarily include cash and certain U.S. deferred tax items not specifically allocated to another segment.
14
Selected financial information by reportable segment was as follows:
Net sales:
U.S. Factory-built Housing
Canadian Factory-built Housing
Consolidated net sales
Operating income:
U.S. Factory-built Housing EBITDA
97,449
71,862
264,918
210,847
Canadian Factory-built Housing EBITDA
4,573
6,473
10,431
17,000
Corporate/Other EBITDA
(17,105
(13,271
(49,656
(39,201
Depreciation
(7,784
(6,862
(22,029
(16,195
Amortization
(2,889
(2,777
(8,767
(7,822
Net income attributable to non-controlling interest
Consolidated operating income
Depreciation:
7,172
6,332
20,220
14,658
462
372
1,347
1,084
150
158
453
Consolidated depreciation
7,784
6,862
22,029
16,195
Amortization of U.S. Factory-built Housing intangible assets:
2,889
2,777
8,767
7,822
Capital expenditures:
12,124
16,670
34,116
38,091
213
1,091
1,087
2,032
807
378
2,768
863
Consolidated capital expenditures
13,144
18,139
37,971
40,986
Total Assets:
U.S. Factory-built Housing (1)
1,235,694
1,239,338
Canadian Factory-built Housing (1)
131,779
132,420
Corporate/Other (1)
669,996
551,583
Consolidated total assets
15
14.Commitments, Contingencies, and Legal Proceedings
Repurchase Contingencies and Guarantees
The Company is contingently liable under terms of repurchase agreements with lending institutions that provide wholesale floor plan financing to retailers. These arrangements, which are customary in the manufactured housing industry, provide for the repurchase of products sold to retailers in the event of default by the retailer on its agreement to pay the financial institution. The risk of loss from these agreements is significantly reduced by the potential resale value of any products that are subject to repurchase and is spread over numerous retailers. The repurchase price is generally determined by the original sales price of the product less contractually defined curtailment payments. Based on these repurchase agreements and our historical loss experience, we established an associated loss reserve which was $1.7 million at December 28, 2024 and $1.8 million at March 30, 2024, respectively. Excluding the resale value of the homes, the contingent repurchase obligation as of December 28, 2024 was estimated to be $253.0 million. Losses incurred on homes repurchased were immaterial during the three and nine months ended December 28, 2024 and December 30, 2023.
At December 28, 2024, the Company was contingently obligated for $31.5 million under letters of credit, consisting of $12.7 million to support long-term debt, $18.5 million to support the casualty insurance program, and $0.3 million to support bonding agreements. The letters of credit are issued from a sub-facility of the Amended Credit Agreement. The Company was also contingently obligated for $19.6 million under surety bonds, generally to support performance on long-term construction contracts and license and service bonding requirements.
In the normal course of business, the Company’s former subsidiaries that operated in the United Kingdom historically provided certain guarantees to two customers. Those guarantees provide contractual liability for proven construction defects up to 12 years from the date of delivery of certain products. The guarantees remain a contingent liability of the Company which declines over time through October 2027. As of the date of this report, the Company expects few, if any, claims to be reported under the terms of the guarantees.
Product Liability - Water Intrusion
The Company has received consumer complaints for damages related to water intrusion in homes built in one of its manufacturing facilities prior to fiscal 2022. The Company has investigated, and believes, the cause of the damage is the result of materials that did not perform in accordance with the manufacturer's contractual obligations. The Company has identified certain homes constructed over that period that may be affected. Based on the results of ongoing investigation and repair efforts, the Company has developed and HUD has approved a remediation plan under Subpart I of the HUD code. The plan calls for inspection and repair of affected homes if there is evidence of damage, or procedures to mitigate the opportunity for future damage. The Company recorded charges to execute the remediation plan of $34.5 million during the fourth quarter of fiscal 2024. The Company estimated the charges by establishing a range of total expected costs determined by an actuary using a Monte Carlo simulation. The analysis resulted in a range of losses between $34.5 million and $85.0 million. The Company was not able to determine a value in the range that was more likely than any other value, and as prescribed by U.S. GAAP, recorded the charge for remediation based on the low end of the range of potential losses. The Company is monitoring the results of the inspection and repair activities, and may revise the amount of the estimated liability, which could result in an increase or decrease in the estimated liability in future periods. The liability, net of $0.1 million of remediation payments made during the third quarter of fiscal 2025, is included in other current liabilities in the accompanying Condensed Consolidated Balance Sheets.
Based on the Company's investigation into the cause of the water intrusion, including third-party testing of the material at issue, the Company believes it is possible that it will recover some or all of the estimated remediation costs. The Company will attempt to recover those costs from the manufacturer of the material, the distributor of the material, their related insurance providers or from the Company's insurance providers. However, the Company is unable to record an offset for any estimated costs at this time in accordance with U.S. GAAP.
Legal Proceedings
The Company has agreed to indemnify counterparties in the ordinary course of its business in agreements to acquire and sell business assets and in financing arrangements. The Company is subject to various legal proceedings and claims that arise in the ordinary course of its business. As of the date of this filing, the Company believes the ultimate liability with respect to these contingent obligations will not have, either individually or in the aggregate, a material adverse effect on the Company’s financial condition, results of operations, or cash flows.
16
Item 2.MANAGEMENT’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following should be read in conjunction with Champion Homes, Inc.’s condensed consolidated financial statements and the related notes that appear in Item 1 of this Report.
Overview
Champion Homes, Inc., formerly known as Skyline Champion Corporation (the “Company”), is a leading producer of factory-built housing in the U.S. and Canada. The Company serves as a complete solutions provider across complementary and vertically integrated businesses including factory-built home manufacturing, company-owned retail locations, construction services, and transportation logistics services. The Company markets its homes under several nationally recognized brand names including Champion Homes, Genesis Homes, Skyline Homes, Regional Homes, Athens Park Models, Dutch Housing, Atlantic Homes, Excel Homes, Homes of Merit, New Era, Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, and Titan Homes in the U.S., and Moduline and SRI Homes in western Canada. The Company operates 43 manufacturing facilities throughout the U.S. and five manufacturing facilities in western Canada that primarily construct factory-built, timber-framed, manufactured and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 72 sales centers that sell manufactured homes to consumers across the U.S. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles, and other products throughout the U.S. and Canada.
Acquisitions and Expansions
The Company is focused on operational improvements to increase capacity utilization and profitability at its existing manufacturing facilities as well as measured expansion of its manufacturing and retail footprint through facility and equipment investments and acquisitions. Those investments will help improve the Company's ability to satisfy demand for affordable housing. During fiscal 2023, robust demand for housing began to slow as inflation and higher interest rates made housing less affordable. The current economic environment drives an even greater need for attainable housing solutions. As a result, the Company continues to focus on growing in strong housing markets across the U.S. and Canada, as well as expanding products and services to provide more holistic and affordable solutions to homebuyers.
In October 2023, the Company acquired Regional Homes, which operated three manufacturing facilities in Alabama and 44 retail sales centers across the Southeast U.S. Regional Home's strong presence in large HUD markets expanded our captive retail and manufacturing distribution in that region. In July 2022, the Company acquired 12 Factory Expo retail sales centers from Alta Cima Corporation, which expanded the internal retail network across a broader portion of the U.S. In May 2022, the Company acquired Manis Custom Builders, Inc. ("Manis") in order to expand its manufacturing footprint and further streamline its product offering in the Southeast U.S.
In addition to those acquisitions, the Company is also focused on enhancing its U.S. manufacturing production capacity through various plant start-ups in strategic locations. As a result, the Company began production in previously idled or acquired facilities in Decatur, Indiana and Bartow, Florida in fiscal 2024 and a facility in Pembroke, North Carolina in the fourth quarter of fiscal 2023. The Company owns six idle manufacturing facilities that could be used for further manufacturing capacity expansion in future periods.
During fiscal 2024, the Company made an equity investment in ECN. The investment, in part, facilitated the creation of a captive finance company in partnership with Triad, a subsidiary of ECN. The captive finance company, Champion Financing, through Triad, provides factory-built home floor plan and consumer loans to manufactured home retailers and homebuyers. The Company believes this offering will provide customers needed financing solutions and improve the Company's market share.
The Company's acquisitions and investments are part of a strategy to grow and diversify revenue with a focus on increasing the Company’s homebuilding presence in the U.S. as well as improving the results of operations through streamlining production of similar product categories. These acquisitions and investments are included in the Company's consolidated results for periods subsequent to their respective acquisition dates.
Industry and Company Outlook
The need for newly built affordable, single-family housing has continued to drive demand for new homes in the U.S. and Canadian markets. In recent years, manufactured home construction experienced revenue growth due to a number of favorable demographic trends and demand drivers in the United States, including underlying growth trends in key homebuyer groups, such as the population over 55 years of age, the population of first-time home buyers, and the population of households earning less than $60,000 per year.
Because of the need for affordable housing, the Company saw an increase in customer orders during the nine months ended December 28, 2024 versus the same period last year. As a result of the increased orders the Company's manufacturing backlog was $312.6 million as of December 28, 2024 compared to $290.4 million as of December 30, 2023.
For the nine months ended December 28, 2024, approximately 87% of the Company’s U.S. manufacturing sales were generated from the manufacture of homes that comply with the U.S. Department of Housing and Urban Development ("HUD") code construction standard in the U.S. Industry shipments of HUD-code homes are reported on a one-month lag. According to data reported by the Manufactured Housing Institute, HUD-code industry home shipments were 71,968 and 61,622 units during the eight months ended November 30, 2024 and 2023, respectively. Based on industry data, the Company’s U.S. wholesale market share of HUD code homes sold was 22.2% and 18.9%, for the eight months ended November 30, 2024 and 2023, respectively. Annual HUD-code industry shipments have generally increased since calendar year 2009 when only 50,000 HUD-coded manufactured homes were shipped, the lowest level since the industry began recording statistics in 1959. While shipments of HUD-coded manufactured homes have improved modestly in recent years, current manufactured housing shipments are still at lower levels than the long-term historical average of over 200,000 units per year. Manufactured home sales represent approximately 9% of all U.S. single family home starts. Our market share in the U.S total housing market was approximately 2.5% and 2.1% for the nine months ended December 28, 2024 and December 30, 2023, respectively.
UNAUDITED RESULTS OF OPERATIONS FOR THE THIRD QUARTER OF FISCAL 2025 VS. 2024
Income Statements Data:
Interest income, net
Net income before equity in net income of affiliates
Equity in net income of affiliates
Reconciliation of Adjusted EBITDA:
10,673
9,639
Equity in net income of ECN
(656
Transaction costs
1,188
(1,000
Adjusted EBITDA
83,261
66,252
As a percent of net sales:
28.1
%
25.3
16.8
15.2
11.3
10.0
9.5
8.4
12.9
11.8
18
NET SALES
The following table summarizes net sales for the three months ended December 28, 2024 and December 30, 2023:
$Change
%Change
85,470
15.3
U.S. manufacturing and retail net sales
89,633
17.2
U.S. homes sold
6,437
5,643
794
14.1
U.S. manufacturing and retail average home selling price
94.9
92.3
2.6
2.8
Canadian manufacturing net sales
(5,111
(16.6
%)
Canadian homes sold
209
249
(40
(16.1
Canadian manufacturing average home selling price
122.9
123.7
(0.8
(0.6
Corporate/Other net sales
948
12.6
U.S. manufacturing facilities in operation at end of period
43
U.S. retail sales centers in operation at end of period
72
Canadian manufacturing facilities in operation at end of period
Net sales for the three months ended December 28, 2024 were $644.9 million, an increase of $85.5 million, or 15.3%, compared to the three months ended December 30, 2023. The following is a summary of the change by operating segment.
U.S. Factory-built Housing:
Net sales for the Company’s U.S. manufacturing and retail operations increased by $89.6 million, or 17.2%, for the three months ended December 28, 2024 compared to the three months ended December 30, 2023. The increase was due to a 14.1% increase in new homes sold and a 2.8% increase in the average selling price per new home. The increase in the number of homes sold was due to higher customer demand and production volumes compared to the prior year, as well as an additional 2 weeks of activity from Regional Homes in the current quarter. The increase in average selling price was due to the increase in the number of units sold through our company-owned retail sales centers. The mix of wholesale unit sales sold to independent channels versus homes sold through our company-owned retail sales centers impacts average selling price since we capture revenue from additional installation services for homes sold through internal channels.
Canadian Factory-built Housing:
The Canadian Factory-built Housing segment net sales decreased by $5.1 million, or 16.6% for the three months ended December 28, 2024 compared to the same period in the prior fiscal year, primarily due to a 16.1% decrease in homes sold and a 0.6% decrease in average home selling price. The decrease in homes sold is due to slowing demand for housing in the Canadian market. On a constant currency basis, net sales for the Canadian segment were favorably impacted by approximately $0.1 million due to fluctuations in the translation of the Canadian dollar to the U.S. dollar during the three months ended December 28, 2024 as compared to the same period of the prior fiscal year.
Corporate/Other:
Net sales for Corporate/Other includes the Company’s transportation business, financing activities, and the elimination of intersegment sales. For the three months ended December 28, 2024, net sales increased $0.9 million, or 12.6%, primarily attributable to revenue generated from Champion Financing, partially offset by lower recreational vehicle shipments from the Company's transportation business.
GROSS PROFIT
The following table summarizes gross profit for the three months ended December 28, 2024 and December 30, 2023:
Gross profit:
167,507
128,050
39,457
30.8
6,781
9,066
(2,285
(25.2
6,734
4,156
2,578
62.0
Total gross profit
39,750
Gross profit as a percent of net sales
Gross profit as a percent of sales during the three months ended December 28, 2024 was 28.1% compared to 25.3% during the three months ended December 30, 2023. The following is a summary of the change by operating segment.
Gross profit for the U.S. Factory-built Housing segment increased by $39.5 million, or 30.8%, during the three months ended December 28, 2024 compared to the same period in the prior fiscal year. Gross profit was 27.4% as a percent of segment net sales for the three months ended December 28, 2024 compared to 24.6% in the same period of the prior fiscal year. The increase in gross profit as a percent of segment net sales is being driven by higher average selling prices on new homes sold through our Company-owned retail sales centers, which also generated a greater percentage of total segment revenue than the prior year as well as lower input costs and synergies realized from the acquisition of Regional Homes.
Gross profit for the Canadian Factory-built Housing segment decreased by $2.3 million, or 25.2%, during the three months ended December 28, 2024 compared to the same period in the prior fiscal year. The decrease in gross profit is primarily due to lower sales volumes and average selling prices caused by slowing demand. Gross profit as a percent of net sales was 26.4% for the three months ended December 28, 2024, compared to 29.4% in the same period of the prior year, primarily due to less absorption of fixed costs due to lower sales volumes.
Gross profit for the Corporate/Other segment increased $2.6 million, or 62.0%, during the three months ended December 28, 2024 compared to the same period of the prior fiscal year due primarily to the inclusion of Champion Financing.
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES
Selling, general, and administrative expenses include in part costs that are not directly attributable to the manufacture or resale of our products, including foreign currency transaction gains and losses, equity compensation, and intangible amortization expense. The following table summarizes selling, general, and administrative expenses for the three months ended December 28, 2024 and December 30, 2023:
Selling, general, and administrative expenses:
80,121
65,298
14,823
22.7
2,670
2,965
(295
(9.9
25,423
16,828
8,595
51.1
Total selling, general, and administrative expenses
23,123
27.2
Selling, general, and administrative expense as a percent of net sales
Selling, general, and administrative expenses were $108.2 million for the three months ended December 28, 2024, an increase of $23.1 million, or 27.2%, compared to the same period in the prior fiscal year. The following is a summary of the change by operating segment.
Selling, general, and administrative expenses for the U.S. Factory-built Housing segment increased $14.8 million, or 22.7%, during the three months ended December 28, 2024 as compared to the same period in the prior fiscal year. SG&A, as a percent of segment net sales increased to 13.1% for the three months ended December 28, 2024 compared to 12.5% during the comparable period of the prior fiscal year. The increase in SG&A as a percent of segment sales was due to higher sales volumes through our Company-owned retail sales centers which incur a higher percent of SG&A than wholesale sales to independent retailers. Additionally, we incurred higher incentive compensation during the period, which is generally based on sales volume or a measure of profitability.
Selling, general, and administrative expenses for the Canadian Factory-built Housing segment decreased $0.3 million, or 9.9%, for the three months ended December 28, 2024 when compared to the same period of the prior fiscal year. Selling, general, and administrative
20
expenses as a percent of segment net sales increased to 10.4% for the three months ended December 28, 2024 compared to 9.6% during the comparable period of the prior fiscal year due to decreased leverage of fixed costs as a result of the reduction in sales during the period.
Selling, general, and administrative expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. Selling, general, and administrative expenses for Corporate/Other increased $8.6 million, or 51.1%, during the three months ended December 28, 2024 as compared to the same period of the prior fiscal year. The increase was due primarily to investments made in people and information systems to support future growth.
INTEREST (INCOME), NET
The following table summarizes the components of interest (income), net for the three months ended December 28, 2024 and December 30, 2023:
Interest expense
2,099
1,927
172
8.9
Less: interest income
(6,090
(6,236
146
(2.3
318
(7.4
Average outstanding floor plan payable
87,088
70,564
Average outstanding long-term debt
24,693
23,168
Average cash balance
575,992
599,531
Interest income, net was $4.0 million for the three months ended December 28, 2024, compared to $4.3 million in the same period of the prior fiscal year. The change was primarily due to lower interest income from lower average invested cash balances and higher interest expense from higher average outstanding floor plan payables.
OTHER (INCOME) EXPENSE
The following table summarizes other expense for the three months ended December 28, 2024 and December 30, 2023:
(2,914
(385.4
Other income for the three months ended December 28, 2024 represents dividend income of $1.2 million from the investment in ECN Preferred Shares and $1.0 million insurance proceeds for partial settlement of certain Champion Home Builders’ pre-bankruptcy workers' compensation claims. Other expense for the three months ended December 30, 2023 primarily related to $1.2 million of transaction costs incurred for the acquisition of Regional Homes, partially offset by dividend income of $0.6 million from the investment in ECN Preferred Shares.
INCOME TAX EXPENSE
The following table summarizes income tax expense for the three months ended December 28, 2024 and December 30, 2023:
3,934
Effective tax rate
21.1
21.4
Income tax expense for the three months ended December 28, 2024 was $16.7 million, representing an effective tax rate of 21.1%, compared to income tax expense of $12.8 million, representing an effective tax rate of 21.4% for the three months ended December 30, 2023.
21
The Company’s effective tax rate for the three months ended December 28, 2024 and December 30, 2023, differ from the federal statutory income tax rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, and results in foreign jurisdictions.
EQUITY IN NET INCOME OF AFFILIATES
The following table summarizes equity in net income of affiliates for the three months ended December 28, 2024 and December 30, 2023:
100.0
The Company's investment in ECN is accounted for under the equity method and the Company’s share of the earnings or losses of ECN are recorded on a three-month lag. Equity in net income of affiliates of $0.6 million for the three months ended December 28, 2024 represents a gain on the equity method investment in ECN of $0.7 million and net losses from other unconsolidated affiliates of $0.1 million.
NON-CONTROLLING INTEREST
The following table summarizes net income attributable to non-controlling interest for the three months ended December 28, 2024 and December 30, 2023:
Net income attributable to non-controlling interest represents the minority partner's 49% share of the results of operations of Champion Financing.
ADJUSTED EBITDA
The following table reconciles net income attributable to Champion Homes, Inc., the most directly comparable U.S. GAAP measure, to Adjusted EBITDA, a non-GAAP financial measure, for the three months ended December 28, 2024 and December 30, 2023:
14,567
31.0
1,034
10.7
*
(1,188
17,009
25.7
* indicates that the calculated percentage is not meaningful
Adjusted EBITDA for the three months ended December 28, 2024 was $83.3 million, an increase of $17.0 million from the same period of the prior fiscal year. The increase is primarily a result of higher sales volumes and gross profit, partially offset by higher SG&A expenses.
22
UNAUDITED INCOME STATEMENTS FOR THE FIRST NINE MONTHS OF FISCAL 2025 VS. 2024
Equity in net (income) of ECN
(135
3,253
232,470
191,899
27.1
26.0
14.8
10.3
11.2
8.6
9.7
12.3
The following table summarizes net sales for the nine months ended December 28, 2024 and December 30, 2023:
401,121
26.9
419,376
30.4
19,332
15,302
4,030
26.3
93.0
90.1
2.9
3.3
(17,454
20.3
555
702
(147
20.9
123.8
122.8
1.0
0.8
(801
23
Net sales for the nine months ended December 28, 2024 were $1.9 billion, an increase of $401.1 million, or 26.9%, compared to the nine months ended December 30, 2023. The following is a summary of the change by operating segment.
Net sales for the Company’s U.S. manufacturing and retail operations increased by $419.4 million, or 30.4%, for the nine months ended December 28, 2024 compared to the nine months ended December 30, 2023. The increase was primarily due to the inclusion of $447.3 million of net sales from Regional Homes in fiscal 2025 compared to $119.7 million in the prior-year period, which represented approximately 2.5 months of operations from the date of acquisition through December 30, 2023. The number of homes sold during the period increased 26.3% and the total average home selling price increased 3.3%. The increase in the number of homes sold was due to higher customer demand and production volumes compared to the prior year and the inclusion of Regional Homes sales for all of the first nine months of fiscal 2025 compared to 2.5 months in the prior year period. The increase in average selling price was due primarily to the increase in the number of units sold through our company-owned retail sales centers, also in part a result of the addition of Regional Homes. The mix of wholesale unit sales versus homes sold through our company-owned retail sales centers impacts average selling price. During the nine months ended December 28, 2024, wholesale average selling price per new home decreased due to changes in product mix, including customers choosing homes with fewer or lower cost options.
The Canadian Factory-built Housing segment net sales decreased by $17.5 million, or 20.3% for the nine months ended December 28, 2024 compared to the same period in the prior fiscal year, primarily due to a 20.9% decrease in homes sold, partially offset by a 0.8% increase in average home selling price. The decrease in homes sold is due to slowing demand in the Canadian market. On a constant currency basis, net sales for the Canadian segment were unfavorably impacted by approximately $1.2 million due to fluctuations in the translation of the Canadian dollar to the U.S. dollar during the nine months ended December 28, 2024 as compared to the same period of the prior fiscal year.
Net sales for Corporate/Other includes the Company’s transportation business, financing activities and the elimination of intersegment sales. For the nine months ended December 28, 2024, net sales decreased $0.8 million, or 3.3%, primarily attributable to a decrease in recreational vehicle shipments, offset in part by the inclusion of Champion Financing.
The following table summarizes gross profit for the nine months ended December 28, 2024 and December 30, 2023:
478,167
351,558
126,609
36.0
16,970
24,101
(7,131
29.6
16,433
11,775
4,658
39.6
124,136
32.0
Gross profit as a percent of sales during the nine months ended December 28, 2024 was 27.1% compared to 26.0% during the nine months ended December 28, 2024. The following is a summary of the change by operating segment.
Gross profit for the U.S. Factory-built Housing segment increased by $126.6 million or 36.0%, during the nine months ended December 28, 2024 compared to the same period in the prior fiscal year. The increase in gross profit was driven by higher unit volume due to higher customer demand and the addition of Regional Homes. Gross profit was 26.6% as a percent of segment net sales for the nine months ended December 28, 2024 compared to 25.5% in the same period of the prior fiscal year. The increase in gross profit as a percent of segment net sales is driven by a greater percentage of homes sold through our company-owned retail sales centers and lower manufacturing input costs.
Gross profit for the Canadian Factory-built Housing segment decreased by $7.1 million, or 29.6% during the nine months ended December 28, 2024 compared to the same period in the prior fiscal year. The decrease in gross profit is primarily due to lower sales volumes.
24
Gross profit as a percent of net sales was 24.7% for the nine months ended December 28, 2024, compared to 28.0% in the same period of the prior year, primarily the result of decreased leverage of fixed manufacturing costs.
Gross profit for the Corporate/Other segment increased $4.7 million, or 39.6%, during the nine months ended December 28, 2024 compared to the same period of the prior fiscal year. Gross profit increased as a result of the revenue mix in the Company's transportation operations and the inclusion of Champion Financing.
Selling, general, and administrative expenses include in part costs that are not directly attributable to the manufacture or resale of our products, including foreign currency transaction gains and losses, equity compensation, and intangible amortization expense. The following table summarizes selling, general, and administrative expenses for the nine months ended December 28, 2024 and December 30, 2023:
242,236
163,191
79,045
48.4
7,886
8,185
(299
(3.7
66,574
48,608
17,966
37.0
96,712
44.0
Selling, general, and administrative expenses were $316.7 million for the nine months ended December 28, 2024, an increase of $96.7 million, or 44.0%, compared to the same period in the prior fiscal year. The following is a summary of the change by operating segment.
Selling, general, and administrative expenses for the U.S. Factory-built Housing segment increased $79.0 million, or 48.4%, during the nine months ended December 28, 2024 as compared to the same period in the prior fiscal year. Selling, general, and administrative expenses, as a percent of segment net sales increased to 13.5% for the nine months ended December 28, 2024 compared to 11.8% during the comparable period of the prior fiscal year. The increases were primarily due to the inclusion of Regional Homes for the full period of fiscal 2025 compared to 2.5 months in the prior period, as well as a charge of $7.9 million in the first quarter of fiscal 2025 related to the change in fair value of the contingent consideration included in the acquisition of Regional Homes. Additionally, incentive compensation costs, which are generally based on sales volume or measures of profitability, increased in the current period.
Selling, general, and administrative expenses for the Canadian Factory-built Housing segment were lower by $0.3 million compared to the same period of the prior fiscal year. Selling, general, and administrative expenses as a percent of segment net sales increased to 11.5% for the nine months ended December 28, 2024 compared to 9.5% during the comparable period of the prior fiscal year due to less absorption of fixed costs caused by lower sales.
25
Selling, general, and administrative expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. Selling, general, and administrative expenses for Corporate/Other increased $18.0 million, or 37.0%, during the nine months ended December 28, 2024 as compared to the same period of the prior fiscal year due primarily to higher incentive compensation and investments made in people and information systems to support future growth.
The following table summarizes the components of interest (income), net for the nine months ended December 28, 2024 and December 30, 2023:
6,409
2,666
3,743
140.4
(19,386
(26,756
7,370
(27.5
11,113
(46.1
89,742
23,348
24,683
15,983
538,408
679,489
Interest (income), net was $13.0 million for the nine months ended December 28, 2024, compared to $24.1 million in the same period of the prior fiscal year. The change was primarily due to lower interest income from lower average invested cash balances and higher interest expense from higher average floor plan payables and long-term debt balances assumed in the acquisition of Regional Homes.
The following table summarizes other (income) expense for the nine months ended December 28, 2024 and December 30, 2023:
(6,184
(219.2
Other (income) of $3.4 million for the nine months ended December 28, 2024 represents dividend income of $2.4 million from the investment in ECN Preferred shares and $1.0 million insurance proceeds for partial settlement of certain Champion Home Builders’ pre-bankruptcy workers' compensation claims. Other expense of $2.8 million for the nine months ended December 30, 2023 represents transaction costs incurred for the acquisition of Regional Homes of $3.3 million, partially offset by dividend income of $0.6 million from the investment in ECN Preferred Shares.
The following table summarizes income tax expense for the nine months ended December 28, 2024 and December 30, 2023:
998
2.2
21.7
23.7
Income tax expense for the nine months ended December 28, 2024 was $45.8 million, representing an effective tax rate of 21.7%, compared to income tax expense of $44.8 million, representing an effective tax rate of 23.7% for the nine months ended December 30, 2023. The effective tax rate for the nine months ended December 28, 2024 was positively impacted by an increase in recognition of tax credits related to the sale of energy efficient homes.
The Company’s effective tax rates for the nine months ended December 28, 2024 and December 30, 2023 differ from the federal statutory income tax rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, and results in foreign jurisdictions.
26
EQUITY IN NET LOSS OF AFFILIATES
The following table summarizes equity in net loss of affiliates for the nine months ended December 28, 2024 and December 30, 2023:
The Company's investment in ECN is accounted for under the equity method and the Company’s share of the earnings or losses of ECN are recorded on a three-month lag. Equity in net loss of affiliates of $1.5 million for the nine months ended December 28, 2024 represents a gain on the equity method investment in ECN of $0.1 million and net losses from other unconsolidated affiliates of $1.6 million.
The following table summarizes non-controlling interest for the nine months ended December 28, 2024 and December 30, 2023:
The following table reconciles net income attributable to Champion Homes, Inc., the most directly comparable U.S. GAAP measure, to Adjusted EBITDA, a non-GAAP financial measure, for the nine months ended December 28, 2024 and December 30, 2023:
18,157
6,779
28.2
(3,253
40,571
Adjusted EBITDA for the nine months ended December 28, 2024 was $232.5 million, an increase of $40.6 million from the same period of the prior fiscal year. The increase is primarily a result of higher sales volumes and gross profit, partially offset by higher SG&A expenses, Those increases are primarily a result of the inclusion of Regional Homes for the full period of fiscal 2025 compared to 2.5 months in the prior year period.
The Company defines Adjusted EBITDA as net income or loss attributable to Champion Homes, Inc. plus expense or minus income: (a) the provision for income taxes; (b) interest (income) expense, net; (c) depreciation and amortization; (d) gain or loss from discontinued operations; (e) non-cash restructuring charges and impairment of assets; (f) equity in net earnings or losses of ECN; (g) charges related to the remediation of the water intrusion product liability claims; and (h) other non-operating income and costs, including but not limited to those costs for the acquisition and integration or disposition of businesses, including the change in fair value of contingent consideration, and idle facilities. Adjusted EBITDA is not a measure of earnings calculated in accordance with U.S. GAAP, and should not be considered an alternative to, or more meaningful than, net income or loss, net sales, operating income or earnings per share prepared on a U.S. GAAP basis. Adjusted EBITDA does not purport to represent cash flow provided by, or used in, operating activities as defined by U.S. GAAP, which is presented in the Statement of Cash Flows. In addition, Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies.
27
Adjusted EBITDA is presented as a supplemental measure of the Company’s financial performance that management believes is useful to investors, because the excluded items may vary significantly in timing or amounts and/or may obscure trends useful in evaluating and comparing the Company’s operating activities across reporting periods. Management believes Adjusted EBITDA is useful to an investor in evaluating operating performance for the following reasons: (i) Adjusted EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest income and expense, taxes, depreciation and amortization and other non-operating income or loss, which can vary substantially from company to company depending upon accounting methods and the book value of assets, capital structure and the method by which assets were acquired; and (ii) analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate the overall operating performance of companies in the industry.
Management uses Adjusted EBITDA for planning purposes, including the preparation of the internal annual operating budget and periodic forecasts: (i) in communications with the Board of Directors and investors concerning financial performance; (ii) as a factor in determining bonuses under certain incentive compensation programs; and (iii) as a measure of operating performance used to determine the ability to provide cash flows to support investments in capital assets, acquisitions and working capital requirements for operating expansion.
BACKLOG
Although orders from customers can be canceled at any time without penalty, and unfilled orders are not necessarily an indication of future business, the Company’s unfilled U.S. and Canadian manufacturing orders at December 28, 2024 totaled $312.6 million compared to $290.4 million at December 30, 2023. The increase in backlog is due to higher net orders compared to the prior fiscal year.
Liquidity and Capital Resources
Sources and Uses of Cash
The following table presents summary cash flow information for the nine months ended December 28, 2024 and December 30, 2023:
Net cash provided by (used in):
Operating activities
Investing activities
Financing activities
Effect of exchange rate changes on cash, cash equivalents
The Company’s primary sources of liquidity are cash flows from operations and existing cash balances. Cash balances and cash flows from operations for the next year are expected to be adequate to cover working capital requirements, capital expenditures, and strategic initiatives and investments. The Company has an Amended Credit Agreement which provides for a $200.0 million revolving credit facility, including a $45.0 million letter of credit sub-facility. At December 28, 2024, $168.5 million was available for borrowing under the Amended Credit Agreement. The Company’s revolving credit facility includes (i) a maximum consolidated total net leverage ratio of 3.25 to 1.00, subject to an upward adjustment upon the consummation of a material acquisition, and (ii) a minimum interest coverage ratio of 3.00 to 1.00. The Company anticipates compliance with its debt covenants and projects its level of cash availability to be in excess of cash needed to operate the business for the next year and beyond. In the event operating cash flow and existing cash balances were deemed inadequate to support the Company’s liquidity needs, and one or more capital resources were to become unavailable, the Company would revise its operating strategies.
Cash provided by operating activities was $194.9 million for the nine months ended December 28, 2024 compared to $218.6 million for the nine months ended December 30, 2023. The decrease was primarily driven by less favorable changes in working capital items during the first nine months of fiscal 2025 as compared to the same period of the prior year, partially offset by higher income before non-cash charges.
Cash used in investing activities was $35.0 million for the nine months ended December 28, 2024 compared to $474.4 million for the nine months ended December 30, 2023. The decrease in cash used for investing activities was related to the Company's acquisition of Regional Homes, an investment in floor plan loans, and the purchase of ECN common and preferred stock in fiscal 2024 which did not recur in fiscal 2025.
Cash used in financing activities was $65.9 million for the nine months ended December 28, 2024 compared to $3.9 million for the nine months ended December 30, 2023. The change between periods was primarily due to repurchases of the Company's common stock totaling $60.0 million in fiscal 2025.
28
Critical Accounting Policies
For a discussion of our critical accounting policies that management believes affect its more significant judgments and estimates used in the preparation of our Consolidated Financial Statements, see Part II, Item 7 of the Fiscal 2024 Annual Report, under the heading “Critical Accounting Policies.” There have been no significant changes in our significant accounting policies or critical accounting estimates discussed in the Fiscal 2024 Annual Report, other than those included in Note 1, "Basis of Presentation".
Recently Issued Accounting Pronouncements
For information on the impact of recently issued accounting pronouncements, see Note 1, “Basis of Presentation – Recently Issued Accounting Pronouncements,” to the condensed consolidated financial statements included in this Report.
Forward-Looking Statements
Some of the statements in this Report are not historical in nature and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about our expectations regarding our future liquidity, earnings, expenditures, and financial condition. These statements are often identified by the words “will,” “could”, “should,” “anticipate,” “believe,” “expect,” “intend,” “estimate,” “hope,” or similar expressions. These statements reflect management’s current views with respect to future events and are subject to risks and uncertainties. There are risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those in our forward-looking statements, including regional, national and international economic, financial, public health and labor conditions, and the following:
29
If any of the risks or uncertainties referred to above materializes or if any of the assumptions underlying our forward-looking statements proves to be incorrect, then differences may arise between our forward-looking statements and our actual results, and such differences may be material. Investors should not place undue reliance on our forward-looking statements, which speak only as of the date of this report. We assume no obligation to update, amend or clarify them to reflect events, new information or circumstances occurring after the date hereof, except as required by law.
Item 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
For a discussion of the Company’s interest rate and foreign exchange risks, see Part II, Item 7A of the Fiscal 2024 Annual Report, under the heading "Quantitative and Qualitative Disclosures about Market Risk." There have been no significant changes in such risks since March 30, 2024.
Item 4.CONTROLS AND PROCEDURES
Evaluation of disclosure controls and procedures
The Company maintains disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized, and reported within the specified time periods and accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
The Company’s management, with the participation of the CEO and CFO, evaluated the effectiveness of the Company’s disclosure controls and procedures pursuant to Rule 13a-15(e) of the Exchange Act at December 28, 2024. Based upon this evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of December 28, 2024.
Changes in internal control over financial reporting
There have been no changes in our internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
Item 1.LEGAL PROCEEDINGS
We are involved from time to time in various legal proceedings and claims, including, without limitation, commercial or contractual disputes, product liability claims and other matters. For additional information on legal proceedings, see Note 14 “Commitments, Contingencies and Legal Proceedings – Legal Proceedings,” to the condensed consolidated financial statements included in this Report.
Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Issuer Purchases of Equity Securities
On May 16, 2024, Champion Homes, Inc.’s Board of Directors approved a share repurchase program for up to $100.0 million of the Company’s common stock, which was subsequently amended to allow for purchases of up to $140.0 million. On January 30, 2025, the Company's Board of Directors approved an increase to this share repurchase program of $20.0 million to refresh the available amount to repurchase the Company's common stock back to $100.0 million. Under this share repurchase program, the number of shares ultimately purchased, and the timing of purchases are at the discretion of management and subject to compliance with applicable laws and regulations. The share repurchase program does not expire. The Company intends to fund the program from existing cash. Share repurchases are made in the open market or in privately negotiated transactions in compliance with applicable state and federal securities laws and other legal requirements. The level of repurchase activity is subject to market conditions and other investment opportunities. The repurchase program does not obligate the Company to acquire any particular amount of common stock and may be suspended or discontinued at any time. Share repurchase activity during the three months ended December 28, 2024 was as follows:
Fiscal Period
Total Number of Shares Purchased
Average Price PaidPer Share
Total Number ofShares Purchased as Part of the Publicly Announced Programs
Approximate Dollar Value of Shares That May Yet Be Purchased Under the Programs (in thousands)
11/1/2024 - 11/30/2024
204,948
97.57
80,000
Item 5.OTHER INFORMATION
During the nine months ended December 28, 2024, none of the Company’s directors or Section 16 officers adopted or terminated a Rule 10b5-1 Trading Plan or “non-Rule 10b5-1 trading arrangement,” as defined in Item 408(a) of Regulation S-K.
Item 6.EXHIBITS
Exhibit
Number
31.1
Certification of Chief Executive Officer pursuant to Exchange Act rules 13a-4 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. †
31.2
Certification of Chief Financial Officer pursuant to Exchange Act rules 13a-4 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. †
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. †
10.1
Employment Agreement, dated December 13, 2024, between Champion Home Builders, Inc. and Timothy Larson. †
10.2
Separation Agreement, dated January 3, 2025, between Champion Home Builders, Inc. and Mark J.Yost. †
101 (INS)
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101(SCH)
Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document.
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
† Filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Registrant
Signature
Title
Date
/s/ Tim Larson
President and Chief Executive Officer
February 5, 2025
Tim Larson
(Principal Executive Officer)
/s/ Laurie Hough
Executive Vice President, Chief Financial Officer and Treasurer
Laurie Hough
(Principal Financial Officer)