Shareholders in leading caravan, automotive accessories and mobile camp site manufacturer Fleetwood Corporation Limited (ASX: FWD) have seen their shares smacked down around 14% today after the group released its full year results for the financial year (FY) ending June 30.
Here are the key points from Fleetwood's result:
- Group revenue declined 18% to $301.9 million
- At the divisional level, revenue for the Accommodation and Recreational Vehicle divisions declined by 17.5% and 17.8% respectively
- Operating earnings before interest and tax (EBIT) fell 12% to $9.3 million
- At the divisional level, operating EBIT for the Accommodation division increased by 16.1%, while the Recreational Vehicle divisions experienced a drop of 229.7%
- The board elected not to pay a dividend citing "mixed trading conditions" but stated that they "intend to return to paying dividends as soon as practicable"
- Net debt was $55.9 million at balance date, however post year-end the company is debt free after the sale of the Osprey Village to the Western Australian Department of Housing
Outlook:
Fleetwood has begun to expand into the education and affordable housing markets in an attempt to broaden the use of its manufactured home products. These strategic moves include an exclusive supply agreement with affordable housing provider Gateway Lifestyle Group (ASX: GTY) and have also led to the group winning work with state Departments of Education.
On certain metrics, Fleetwood certainly looks cheap however this is not an uncommon scenario across the mining services sector.
One high profile fund manager that appears to have caught a falling knife is Paradice Investors which only recently became a substantial shareholder on Fleetwood's share register. As recently as August 10 the fund manager was purchasing shares which took its position to 6.8% of shares outstanding.
Picking the bottom is never easy, however it is possible that some of these "knives" are finally close to the floor.
