The following is a summary of the Skyline Champion Corporation (SKY) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Skyline Champion Corp reported Q3 net sales of $560 million, a decrease of 4% YoY due to a decrease in material surcharges and changes in product mix towards less-optioned homes.

• Organic order volume grew by over 230% compared to the same quarter last year, while the backlog grew to $290 million, primarily due to the Regional Homes acquisition.

• Consolidated gross profit declined by 19% to $141 million, with gross margins contracting by 460 basis points to 25.3% due to lower average selling prices and a shift in product mix.

• Net income decreased 43% to $47 million or $0.81 per diluted share, compared to the previous year's earnings of $83 million or $1.44 per share.

• Skyline ended the period with nearly $500 million in cash and cash equivalents, and long-term borrowings of $25 million with no maturities until 2026.

Business Progress:

• Significant progress made in integrating Regional Homes and launching Champion Financing which generated considerable interest in the market.

• New manufacturing plant opened in Bartow, Florida catering to growing demand from builder developers.

• Profitability is expected to start increasing from Q4'24, due to synergies revolving around purchasing, operational enhancements, and cost saving measures.

• The company expects to generate $10 million to $15 million in synergies over the next two years.

• Despite projected decline in gross margins, Skyline is confident in its long-term structural margin targets supported by ongoing improvements in operational capabilities and continued business investments.

More details: Skyline IR

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