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NEWS
Fleetwood doubles RV revenue
Perth manufacturer of Coromal and Windsor caravans expects return to profitability around late-2018Fleetwood Corporation’s RV manufacturing business, which includes Coromal and Windsor caravans and campers, is expected to return to profitability around the first half of the 2018 financial year, Fleetwood's managing director Brad Denison has told investors.
Speaking at an investor briefing after announcing the latest half-year results for the ASX-listed company, Denison was confident that Fleetwood’s once struggling caravan manufacturing division would be “back into the black” within two years.
The Perth-based company reported an 89 per cent increase in revenue from its caravan division to $21.1 million during the first six months of the 2016/2017 financial year, up from $11.2 million for the same period in 2016. That resulted in a $3 million loss, up from $3.9 million the previous half-year.
Denison said caravan production over the past 18 months had effectively doubled, from 10 to around 20-25 units a week. During the same period, factory employee numbers have also increased significantly from around 85 to 225.
“That is the number (of factory staff) we think is necessary to reach the low 30s (weekly production) number we think is necessary to reach the break-even point,” he said.
Denison said the Perth production facility won’t be running at full efficiency until the training of new employees and roll-out of new manufacturing processes including fibreglass sandwich panels for new caravan models, had been completed.
“While the business nearly doubled its revenue compared to this time last year, and while we still need to increase production further, we’re managing labour efficiency closely so we can get the business back to profitably as soon as possible,” he said.
Denison pointed to a number of reasons for the dramatic turnaround, including new management, refreshed product range and expansion of the dealer network. He said more than half the dealer network are expected to be operating as single franchise dealerships, only selling Windsor/Coromal brands, within 12 months.
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Written byChris Fincham
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Please see our Editorial Guidelines & Code of Ethics (including for more information about sponsored content and paid events). The information published on this website is of a general nature only and doesn’t consider your particular circumstances or needs.
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