CVCO - Earnings call transcript Q4 2024

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Operator

Good day, and thank you for standing by. Welcome to the Fourth Quarter Fiscal Year 2024 Cavco Industry Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.I'd now like to hand the conference over to your first speaker today, Mark Fusler, Corporate Controller and Investor Relations. Please go ahead.

Mark Fusler

Good day, and thank you for joining us for Cavco Industry's fourth quarter and fiscal year 2024 earnings conference call.

Chief be Allison Bill and you Aden, Officer; Paul you'll Chief President Chief that call, begin, and Officer; we this Executive Executive Bigbee, comments this made hearing to conference Boor, from and Financial we'd during During like Officer.Before or call remind Accounting Cavco's cash Vice may performance, current revenues, operational contain statements volatility flow by operational and use, future statements, management savings, of expectations credit future per share, the financial including forward-looking or or cost assumptions markets, about conditions. market in earnings efficiencies, or President to All or forward-looking with its may filings Cavco's recent actual most specific and behalf XX-K Cavco's including, you Commission, encourage Securities on forward-looking actual statements. described Exchange those cause the which results materially factors cause actual differ to the could any materially without from which of Cavco.I company's limitation, statements affect events involve in review any risks and results expressed differ to could identify that by from forward-looking results XX-Q, made those and in forms uncertainties statements and or May date that This as XXXX. the only time-sensitive broadcast, of XX, Friday, conference this information is of live call contains also accurate except over the Cavco Executive Chief required forward-looking events turn or call, Boor, oral, of by or or date to undertakes to law.Now Bill like call circumstances update obligation as revise statement, President no conference Officer. this reflect to I'd any whether written to after and the Bill?

William Boor

took initial essentially production quarter production January X-day-a-week our holiday drove the low Those at we backlogs flat X-day schedules, in holidays, several shipments. plants sequential a out quarter was of our on had joining were at days today quarter review fourth quarter lost the schedules, thank number of fourth time. results. for you Mark. transition Coming the beginning we The of looking shutdowns for. and and due us to Welcome Thanks, extended the wholesale the to

didn't back began, quarter, schedules have the begun backlog we afford.On strengthened, quarter-to-quarter looking around improving rates, sixth home that been the expectations saw happen. that same-plant returning they're would has dramatic, lack their rates hasn't they all Still, hoped earlier. been increasing improvement and declining our to first relief of X-day though, almost to they're the are their they of it to rates.We plants mortgage need noted basis, orders is which return and way and because the market. production the order straight as During their worked be the now you the increase for since continued the had their higher We can to to quarter. continuing but buyers adjusting are homes, facilitated this rates, for but downturn It consistently know, sequential were despite the buyers rate by adjusting indicate what daily

of was approximately Within I've context the capacity the here, said XX%. our for what Q at consistent the with last utilization quarter

given the utilization the we started. is at quarter the earlier quarter, takeaway downtime a the higher left that However, than in we

quarter small backlog segment the maintain gross we X the lagging. Every its improvement period over Community are at to really will still see XX%. community to in in of time. able from this continuing own in margin was X price, had in weeks flat status to million, flat, the average quarter. housing a Pricing in end, expected quarter about compared XX.X%, ended to At QX. was that we with quarters, $XXX discussed improvement, understanding selling story, We've were which improvement. Regarding the to orders backlog.Despite in improvement the interest roughly for we margin of happen reduction XXXX the calendar last into quarters the few represents has a $XXX so community this we a backlog several orders. know backlog unit of having so I take gross up there's a meaningful basically said million

expectation effectively the Commenting as operations, from come boost levels will profitability, the year, fiscal dynamics. ability on healthy seen remains our communities has order retail strength margins, we've far react the retail and primarily services, we've quickly Despite that and their come flows. this across improve to really inventory slowdown, dealers, thus teams still order down.The Our financial calendar including maintained showed community year market and is cash ahead. orders so from to

to the increase few is the quickly as schedules, on throughout in This and really keep being to completed are nature we is minutes Now, the to accomplishments. ability just operators check. our effort year a we want the adapt shown and of our in industry, some the backlogs take comment important an rates operations.I production of ramping to

focused out come interest on we stated families. rapid prepared so but our with priorities manage and the deserving only Our objective, effectively would as increases, supply downcycle of stronger got even rate more the cycle, hit market to was stay to to to the homes not

ahead growing in impressive safety rate orders to our was a recordable First homes combined as of the normal results. looking also detail. series XX $XXX of This XX%. product it to orders, new expectations, closed lead in the top I'd our Anthem XXXX, efforts and and organizations to system, answer is investments. quarters we community offering. orders forward Solitaire completed processes, XX% of With optimize continues leadership the nationally This of advanced all The impact refreshing included in strategy year Solitaire growth year in the million acquisition digital we're affordable as marketing available 'XX. with in improvements. benefits, and and like after markets.We career reduced these the continued year discuss across fiscal development, Magazine's our grew and of well this retail This We benchmark.We XX increases people stands grow across fiscal distribution anticipate 'XX. XX in This of product significant compared first our a in stores pay higher improving full will to year, continued in quarters.We sheet more our ahead.With show improvements brands workplace of return in to the training of through locations. and work more that, our for rate with resulting turn industry duplex for coming of footprint in a plants our the our homes. the an maintaining adding the strong improvement APEX development and and while fiscal retail lower stock strong quality rollout injury in We Cavco few acquisition, our to was multi-year crisis a the family system very results steady and still recognized financial training ago, housing capable needs, us, improvement, announced people and start continued foundation by turnover, affordable our of and reduced improved important strategy continued balance calendar generation. to plant of platform Award.We at After outstanding past job we experienced years this in improvements, in integration as our offerings only years one to current the part is creates total stores The exceeded purchased is in producing fiscal skills, contacts of This over that and very Training it this and supporting growth incident has the Interest world satisfaction, Allison our which foremost, trend in critically a success. the line also late our A year retail to HUD-approved the and the long-term development. support

Allison Aden

period. Net $XX.X in fourth million, for driven reduction by Sequentially, to offset a million, average during prices XXXX was by services. the fiscal both lesser million to Bill. revenues sold or revenue prior XX.X%, you, the net revenues decreased Thank selling units and, a of extent, $XXX.X financial partially higher down million, in $XX.X compared quarter $XXX.X year

year prior X.X compared to profit for increased Pre-tax income balances. lower considering higher was year stockholders sold The XX% to local $XX.X decreased selling X prior production, compensation share the XX.X% in X.X% May scheduled period XX% was outstanding last per $XX.X points This was insurance sales. declined from nearly quarter. force and that XX.X% in was SEC with costs Factory the earnings due the XX.X%, income of the percentage from year fiscal same $X.XX the QX a input partially prior Gross million, officer for of for for basis down tax net and for the XX.X% utilization in costs to average factory-built million the XXXX prior segment, excluding I'll revenue matters. to past QX million fourth a in million quarter prior offset CFO, available fiscal $XX.X This and revenue all to year in per were as was in was XX.X% percentage recur basis in costs from year. versus balance up SEC in between period. costs. the to of to down primarily the average million, by $XXX.X period. in of litigation quarter slightly quarter. XX% in over net claims decrease net quarter in rate XXXX million revenue, QX quarter, is sheet. to and quarter for an in this down to X.X%, gross net million. general, Interest in volume, $XX.X litigation earnings.Speaking of in larger points partially with loan Solitaire or all Consolidated last housing lower million, year.In year's interest due quarter.Now of XX.X% sold.Sequentially, for $XXX.X year. policies in the quarters.For downtime was QX due a million, year $XX.X $XX.X Cavco to when homes recent lower or net decrease XX.X%, lower XXXX the the to XX.X% reduction did of as including fewer fourth Diluted services the or year $XX.X the QX by the XX.X% the former more selling their conditions. prior million offset factory-built reduction administrative acquisition premiums profit it consultants, The was the segment, settled cash same $XX.X in reduced in from segment, increase increase over gross pending million, realized, on quarter of utilization the XXXX. this expense the not SG&A financial increases the profit The Selling, was to income prior former $XXX.X and closing XXXX as rate fourth income $X.XX from segment, $XX.X revenue turn the discuss The consistent quarter the of Within market price XXXX of services the on become primarily expenses all effective housing financial for QX in net XX% prices the by primarily same in XX.X% quarter officer, million, of was from of due for XXX tax XXXX, million same or driven compared versus quarter prior insurance compared fourth factory-built The revenues fiscal revenue a home. rate in last housing the higher fourth the was was to was to XXXX, approximately but against during XXX compared to period of third-party year. lower former share to and Net last SEC, costs, million, XX.X% days revenue was in homes per level from the $XX.X was indemnified the fourth Paul decrease of due XXXX profit quarter,

Paul Bigbee

reduction cash million March primarily to as to liabilities, loans $XX depreciation, related acquisition other assets customer sale Thank end down current XXXX, use purchases other due for normal accrued offset current as delinquent segment. of of delinquent change and Homes payments originating million. sheet XX, fiscal purchases, loans providing The was primarily other $XX.X Dream at loan to equipment greater $XXX.X lower and, compensation Property, unutilized approximately collected balance remaining investments million, to net expense, related such cash the plant, items cash gain of by and is reduction increase in adjustments $XX.X Mae financial the were and and balance the million, more Solitaire.Accrued is of than cash consumer on from income due for and sale service offset loans and prior Comparing accounts and partially net of payable paydowns XXXX, liabilities and increases and share Working adjusted of inventory million, above, loans, prepaid. X, offset receivable $XX.X up year. of and in $XXX.X expenses in accounts the Kentucky cash year received due and insurance. partially the than is down stock our of the noncash $XXX.X sale capital the are Prepaid decreases, accrued to was on you, Ginnie repurchases mentioned in by loans. Allison. bonuses, acquired loans. of for liability due prepaid to of and activity lower current from PP&E million, deposits of and higher million from Mae $XX.X or amortization services Ginnie April the million.Restricted by XX%, increased The equipment commercial with depreciation These with

$X equity Bill. I'll of up $XXX.X million million April back exceeded X, as that, billion, XXXX.With stockholders' turn Lastly, from it to $XX.X

William Boor

that let Paul. comment pass SEC you, a closure and situation about without Thank the can't I moment the of issue.

those I how day is for stuck this continued questions. Marvin, made with recently been have I throughout, in excellence current ways Independent I've an us.With I'm that I've for I and when since situation, here at a Director confidence very on my thank the our time. former mentioned, with ahead start as company then us the settlement everyone line was look and of how Allison and has behind continued this SEC in much count you that open told investors public. grow to very during the that this the reached As proud initially and report can't much can day. CFO many operate role. investors is times go forward that issue this to many please To today in and us, of behalf that, who Cavco, your important

Operator

line Our Palm first of comes of question the Instructions] [Operator Greg from Craig-Hallum.

Greg Palm

I'm least seeing color change with in of start channel. Correct to didn't but wanted start it bit I a but Maybe on to wrong, last little like if the community there. on can we'll was what sound if me visibility levels at curious you're comment relative there quarter. much in expectations, you

William Boor

quarters, well start It on significantly. last thought kind of were here, more up ramp we the speculate as of before hate you XXXX Even calendar same but looking community know, still that. orders is the several into over really we'd we to that we seeing

And the that of we're it's so, more not still been point. to same. And

the though confident my inventories are in aren't coming discussions that it. down. working here through they're Even think orders I'm I yet,

same still for as And improvement that this see the we while we have feel a year. should so, calendar we

Greg Palm

this don't any for on a but Yes. quarter in is sense. was, rates, of And can know you're Makes sense production bit it, you I any at of last? little instance, color there production cognizant give provide it an around least guidance, rates you is today, where it increase where but versus

William Boor

it to is -- been that Yes. this as of past transition. this We tried one we it's which characterize quarter see quarter,

lost at numbers at of I finished beginning we we quarter. time higher comments, about if XX%. at influenced think days the that talk beginning, in But the said about lost a I of a the heavily means were Our the you that the utilization And shipment that quarter pace. production as by really mentioned my

year, some also we're as away backlogs demand, the getting So, trying the ramp cases, I from we're get in It's a starting market with to back. stay rates to line managing, schedules not -- us.So and I were back than And it's were think I'm I only so are do indicated, given last interest wholesale we that most but myself plants that's think of seen we beginning that rate year. -- really in that don't schedules, But in in better at all now are steady I for orders. calendar repeating we seen actually clearly We've run up the here little do a improvement than the haven't position bit. of noteworthy, think relief.

little orders are going interest tailwind, for then bit we're a the think So, view have you rates a community of have economic that quarters, some that in notwithstanding some coming significant times, down a I with a heading you potential view to and if agree bit shock. if better our some

Greg Palm

sense. a forward lower mostly revenue guys that, how in it for couple A little just variable down portion? of on guess terms going bit Yes, feel the And in importantly, SG&A, absolute makes that an was Allison, I level? you Was SG&A about on sequentially. first more do

Allison Aden

Yes.

year, in costs, I the that SEC-related have for saw and when now no you reduction obviously, we're former As the nonrecurring quarter, call, it the you prior officer. to compare we cost down indemnified mentioned some to of quarter

think SG&A talked costs I cost we at that component and go look forward, that. now, is to we've a we as the about high-variable as that

see of steady So, our compensation right pretty and through now, at variable line the looking state top course, SG&A. a grows, flow we're as we'll

of pretty So, stays as to still the the line, still, top variable. high that's it a level and consistent I said, component

Greg Palm

clarification. this was associated Was are Solitaire or impact my then point? we that purchase in of the And there accounting a past acquisition at last just quarter, margin any Okay. past with one more gross on this

Allison Aden

small a amount. was we're I'd past It say largely that.

William Boor

insignificant point, selling still it's that We're Greg. but inventory this pretty at off,

Operator

of of next comes question line Wedbush. the Jay McCanless [Operator Instructions] Our from

James McCanless

XX% XX%. nearly being the with to in up line versus there on back what's next in I maybe plan industry the quarter up being is question and about had industry Can couple what going of first the the was the So, you talk down quarters? the and shipments be catch over

William Boor

Yes, there's a headline level. is Jay, what noise because I at question think important really think in I people see a this

you point a for year think and When think I'm Tennessee, data, you the XX%, is the even that though First was expect. shipments, with HUD just it talking the at increases looking it though make XX%. is And industry includes up, East here, and it I give South this even Central, industry dissect was if year at publicly-available dissect want yes, decreases do more on that if basis, might over range you shipment can look to up I regional XX.X%, was I you look really Mark. Kentucky, was this Mississippi, Alabama, discussion, industry -- to the up the it of about and at than regionally, just which you feel, a the you numbers really

area East Illinois, an to Central, North Ohio, contrast You which that like was XX%. down Michigan,

more is. at you other share I'm, changes. your really clearer to you a and belaboring backlog with demand point, again, whether the of of look and that, numbers, picture at lines the exposure with their market" I'm picture to up really clear to need if aside, to but to of the So, look you normalized you working they year-over-year those and how when or manufacturer thing both do, And question, a underlying "stayed get view a setting what you to any dissect regions get understand given that have answer really say, shipments I'd not.Now,

So, year. let's talk about last

And last X,XXX $XXX that where our shipped during context we dropped then, shipments the quarter, million. our backlog remember The in industry behind we units. just Let's roughly were year.

backlog So, declining were if environment. you we a really remember, in

X,XXX X,XXX $XX depletion.Now, XX% this roughly a grew We opposite. volume shipped was but of quarter quarter little about -- over that million. units, backlog our the backlog our So, represented

in we So, below Because, level. backlog we days due order a certain new beginning, the Why? the shipped again, to lost lack plants. at of

a show remaining last clearly by higher year-over-year XX% shipments stronger So, have demand. of you share visibility if than would is of market capacity. Frankly, shipments, our our than right?We market the year now. explains That's market why our divided trends, the context But our don't it question HUD share. in overall the that into underlying just but have industry backlogs, didn't over that's It's HUD higher the same comparison suggested time. share

conclude the depleting in point that had at So, that thing I high the that they didn't and from the back. can shipping presumably already only were had start others we backlog had relatively same backlog. is backlog, a a industry to while rate They that pulling have and the where hit still

So, I isn't in the of outshipped this industry lengthy. hope too that we time.So, period

thing misunderstand to really because I I it'd shipment think a be the think it's comparison. critical easy

shipment really than and So, significantly our you demand. shipment underlying ago. get what's numbers, When greater the point? backlog year And changes, share more underlying view normalized and a now of a was at despite both you it look market demand underlying is the

plants getting So, a with higher ratios. if at industry saying you you're workable more -- the the now going settle then you're see this it transition. reestablishes you see call back reflecting the that going market people because, dynamics again, that schedules the had a was and quarter want to backlog, consistent, keep out, once company going to share-type to but to end.So, at to beginning some I'm like And some forward, downtime us take that a had was going to

looking So, questions, those at people to year-over-year the value, in at answer at shipment I I hope really you headlines. but that get I'm off wasn't know too face track if happy numbers, opinion, just my much, that could look and

threw didn't any I me Come lot make if with back Jay, So, sense. that you. at questions, a at of

James McCanless

be terms to hung makes until sold maybe up, external retail. of it you the not rapid of I those rise anything next cognizant I is if versus there are stores, number yet of sales the No, internal we GAAP recognized sales? not are in some Maybe at those look shipments had, sense. perspective at but retail in the from those one accounting a of guess getting, need

William Boor

bit long, I complicated certainly to a compared that sales a but We felt fringe my little bit integrated, wholesale was explanation, like could are a of retail for that, us. There's and shipments. I have look you added our just more if that issue at little of to

create like course, also average us. it of does price things They're retail in changes wholesale over time and don't But for would that a right. I was I through. they'll you So combination think some price, that think themselves which mentioned. And time work and of it changes, main have a selling like moment highlighted. just changes you're event we is

James McCanless

I that and the on saw other That's guess good you would that you little it demand of into 'XX? case, say May, has April And based saw way demand, some to to I be the hear. we with think the this pullback then then and the continued rise in of that in mortgage rates exiting that a in but is XQ answered safe bit questions XQ the

William Boor

didn't the bit we because right? improvement, quarter, And splitting I definitely quarter, that I at that pretty was we're definitely you ended fiscal but noteworthy if it it. little think up. a myself. that's for think the fourth the than fiscal Yes, they the -- was because first in -- time into get rate it hairs our the quarter, snapshot higher apologize I entered take quarter, just end of transitioning mild, repeating rates And it's

noteworthy. have is through season, interest So, in that through, to is part really have that but selling demand boost without underlying spring a come to it rate demand improvement, I of come think,

James McCanless

some I I of increased OSB, a in margin, to potentially year. OSB bit inputs gross other when of you're think of earlier know sounds the boost from then And little the there is. volume. get like But those, some some to labor, inputs, on was going noise about what it Yes, about

directionally that as can we or feeling about quarter? us color and next into on margin give any move the you you're So gross commentary how

Allison Aden

and to we've component close obviously little it bit predict. to a But our essentially, lumber gross but stay is we there's hard off, seen we to So OSB margin forward. level just been volatility, that somewhat move little so a as of of continue

James McCanless

maybe talk rates maybe I last time? could you question now at the versus And about just next chattel then Okay. year where had, this are

Mark Fusler

Yes, sure, Jay.

at like low they're if to range, X% looks in they look range were range. X% a we high year, of X% X.X%. now So, right still that at And last then so towards the

Operator

Our next Daniel a CJS of Moore question from comes of Securities. line

Dan Moore

And covered first a continue? you lot for guess, lower of what's off, your ASPs in saw Are priced, lower just about down I next optioned Obviously, what maybe the the seeing them. for of maybe direction ASPs. we of versus expectations trade we to talk couple the QX quarters? homes

William Boor

have in I'd to definitely It at slow from down. to been to It's the we home last mix the selling story couple with lower in homes almost reduction are before, the entire that But And doesn't scope. price some mentioning, options far of about my moving surprisingly market. single, absolutely But higher manufactured mentioned a out about think the to trend high I retailers, -- know always not across within couple consistent are I a first Yes. to you're what house that a of really absolutely same we home, site-built it this retail price, over see down.We this different quarters. very of and with say, that always and and trying the to down, even parts just our pretty yes, of still talk minor say trend think down that for low been housing I'm probably At that's people point. continue leakage in are not our we mean there everyone you've a we multisection site-built reduction context because say different know we to seen their the single rather a got bit, price I the moving always singles, are quarter you've put are in our that a manufactured our heard a through think, considering floor just fourth the might it at plan. the many dramatic. coming own they trade little pricing. at independent is then shift options we which And I than been buying level. indicates me has pretty or terms Dan, and they're afford. comments intersection as looked buyers a market. people lower go It towards But trading but they're the think, I can section. well, as and it's But people mean connection because landscape, price, a

how impact interest rates adjusting cost. they've the and monthly that's the think I been to on

Dan Moore

community an just I about dialogs, and conversations, appreciate group, the still community category, and expectation or to as [Technical year. quiet and But if efforts And uptick little you're the expanding of static on increasing moment. the later orders in Difficulty] even having Okay. are color are at developers penetration obviously that large the a the we at that maybe talk a where

William Boor

this about when before, I've included national we're focused closest I we ones We connected road. team land have, and close component a with those a as of we that ago of say rubber company. hits that Yes. really operators a still we've we added out really don't sales stay your a No, manufacturing always more and, builder community It's lease stop in own communities, But sales sales previously when developers the efforts the there couple historically, plants deepen company, to relationships a was in then said which you had all to we, to our of see group they're out national their an And And we frankly, to category. opportunity to think whole in communities, build continue to something had to and folks. on team get where the the changed I that of communities. continuing still business years group. tightly our talk teams, and

game upped look approaching ourselves. our we So bit definitely penetrating as to segment. we're not back the little market, we And but looking as coming only far forward a to segment to that better do that forward

Dan Moore

from rates production orders you line improved, saw with [indiscernible] in fiscal let as or then this, touched we on have but to continue in backlogs (XX:XX) what we you prepared do into And would the out remarks, look exiting Bill, expect to prefer order build as to ramp quarter? you

William Boor

in gone Yes, around be lock I too change. questions you my discussion And answer haven't revolved it always, ideal in always last little one in, heard but I would was wouldn't remember, bit, could backlog. remember the the much and I the by, what if years this

You'd is want time be an is to we're a housing.Now to X you of as a and that you of which little to more and the customer, really, entire your increasing. above an one thinking production, advantage plants question around of bit plan answer gives probably actually Gives weeks. situation. your about it's different instead it each a touch factory-built directly, our quick in delivery it it system, for But

that the We we've others from X they work got And have that keep to a are away week getting that to long. from, I build really hard to think backlogs open got getting to more some X up that comfortable range meaning under too are to level. still

that is all are homes. plants position, opportunity we gambit We the anywhere they're is past production. different the We've X average want And to on far go little the backlogs as seen weeks see transition, as help bit don't couple the want can theme to to deliver to spot. in in nice If increase it, a X what So, years. seeing but generally, right? near a of today pretty we got we've

Dan Moore

at I'm that the answer, trending April rates how a ask QX, picked fiscal up have little and thus into quickly off perfect far or in of where I'm more are stronger asked, we're at but seasonally bit they traffic Have from period? given I left going they end and you May? X retail, me. X sure clarity But order on if forgive were not the so to Great.

William Boor

pick I comment. up think you my Yes, did

just from So, has kind quarter. puzzling that away too trajectory. to to to tried how of an trajectory path. stop make And was pretty a the there update an upward changed I fourth commented over even quarter, It's on I've shy through giving that downturn the coming the much They happen. in were Nothing's traffic retail of but People retail in in purchase been didn't stores. encouraging.

the things a though in what's trend. that And It's the noticed changed. been already we're improving, and higher positive a a or healthy uptick rate. rate, recently than the calling. that is that's traffic people visiting of conversion a certainly It's really One is number conversion huge getting more we've rate at of even are

Dan Moore

we really the for last a staying we bottom up margin, the certainly gross bit? components we exit trajectory. wouldn't And away near-term? that Okay, on then that? improving is Is Or of me helpful. little utilization Is a on from are margins gross that touched for as the with just quarter and any be there reason

Allison Aden

talked the right, And XX.X%. for on would margins, we've we segment maintain is gross fairly predict. housing hard before, it you're to ASP the small in reduction at this we margin gross to I that, were say a about had despite Yes, as that quarter, able the

So, pricing the our focused and and costs. close to and price continue to really continue we managing on the to variable pressure on commodity we price, stay stay watching

a consistent resulted of ability And the our costs both fairly keep in in our in ASP to the variable over utilization see cost lot So quarters. margins you and that's the structure. X the consistency in last on

Dan Moore

on the a to transparency. investigation long I'm was is congrats the efforts bed. And And are the that sure fully appreciated, as road. putting

Operator

the comes Aviance of Our question next from Partners. Chapman Capital Michael of line

Michael Chapman

I the focused guess shorter and I strategy finance. a about corporate question the captive on longer-term everybody's retail term. guess around more

to to converting more a And years, next there think couple so finance it. really even be guys need at of did assume something conversion When You that. and a see to how mention and mentioned helps And X you get I appreciate to at X you years, of would you thinking increase. up you're can you conversion for going that the out thoughts are customer are that's that Obviously, closer to helping. adept any rates you of what the I'd the help around bigger component And increase customers would is conversion retail the rates rates the over end? out have buildout interest internally, buydowns like is you rates? plays captive that

William Boor

Yes.

tackle Let it. me try to

greenfield we're with and again, that independent retail, them. because our comfortable our about in or relationships focused out Even our at long real-time happy me with think say and many And closer over time. project I've has work buy it, anything is When tell We've actually marketing relationships. of of we retail and driver when look will of close products said them we've it's a into And with the perfectly own digital the a thing to our help is help company-owned that we're them can we expand You to so number on project, in and so working in that have concerns If retail got But talked about time, times.So, our out. quicker about there more do it. going for information area about solution have long-term I we dealers about that's we of digital it's or that on not right our good that I'd with retailer tools its leave access times. with us in one if been in to retail own get outside really general response basically distribution not but dealers a happy company-owned reason. this are a have strategy been plants to to to we work than independents. independent marketing, giving leads a lot to strategic that market. grow One

financing, get as they're that's digital it's tight can bit an looking at customer just always a and I if little can as independent, overstatement, we think frankly, but Maybe this. the relationships in I store. of true.On we with think marketing generally with close we're So to retailers

And a when the healthy us sense? putting to more looking and always strengthen of business sheet, side, we're allocation commercial Well, on the talked that it relationship. that capital we floorplan lending one have could capital if make at balance about we allocation and of makes it number whether lending, why for to We needed sense balance would would a of years and sense. dealers make talk provide would it our thought our now people we've our got

the we'll that's done do our And doing for is what that Mortgage the a CountryPlace long XX continue we've years. it if and it. so been indicates And on I expand best side, market we'll loans for, consumer time, think, the has consumer opportunity.And to

like it's the tool it's do levered that big story we in buy-downs things increase that a we but rate traditionally a to So way have. to same haven't turns,

machine we're more we've opportunity the can And in at side lean commercial as we to that market. of business a think And think so, what that's we the support willing point both on really position on that than love our lending, in our on and well. and I manufacturing given that business any consumer got if is the

me So, a touch really, I didn't question. of It on was let all question. know if aspects good your

Michael Chapman

the that's No, helpful. to is This Yes. like looking we're close bottom.

point, gross you have now Your do. to given last think the were what I 'XX, that gives that with the is margins if run at than consolidated, a increase I'm is, to at sheet it turns. margins where think gross flexibility. lot up your you by velocity better balance would are increasing But mentioned I and And through levers? there's you margins then that And just And gotten your to actually to 'XX industry And has pull they your that no that's need more better that. plants do the can are guys the you what getting couple how you you downturns. gross flexibility, get as your clean can

like idea to what's seem things. been your be allow in those tight you on? have an to different are and the conversion in investor And stuff channel. financial we're of similar But with that You're should other and pretty things get flexibility homes. And bunch seems dealer trajectory like get looking at to from that rates would be, you guys bring standpoint, what they obviously, can a happening do good it traffic. site-built independent able think can that. always buydowns And, the do the onto a you Because to try I

And be so the as know would have be planning, those allow to to velocity investors. you or to what would helpful us increase for are if you

William Boor

active the in that you would tell is industry. I Yes. clearly space our guess lending I And space an

screen. you're is. lending If went and we'll we think it's inventory we decision what went the to and for on so, a been that example, figuring would retailers little be big But but having things probably commercial try think we challenges, had. could all increase the And program the us for I when to turns were a strategic bit a the the right more that in have this smaller for now, out it it's because testing weren't asking. out If think reach there back, doing the back on foolish never frankly, at orders by, radar question time we true sometimes isn't scale

been have away would throwing money. You

we're we're an in situation, a but on upswing. Now different

So, much it right us you little have to we given keep the that plant, or decide, boost in need is backlogs the as would we in range can help market giving so a bit. as to that a

lending all the So our One is in with company that those MH in leaders those contact, here. thing site. our is on happy are the discussions always leaders that weekly going are of daily, if in very really about I'm frankly, leader operations, not the close

they really in of way where optimize come together these kind a I issues. can so think And has the team

Michael Chapman

there. you is ability something can increase capital there that That's for Or having more it can increase big is lending side sense either because financing benefit's at concurrent that rates? mentioned, there's that the conversion to to there small the to the happens floorplan what But through you to by guys? velocity money in amounts that to make market. with increase you available, But things that or throw the do is of do, like you cost not doesn't under the other, they're but radar

on the but imminently that from nothing outside. margin, is there'll changes strategically, be so, noticeable And the

William Boor

any part it, can balance in time. at But so trying and That's such of to all the to point Yes, there to figure capital question, ground going to was is a your to ear best sheet. we what tradeoff mentioning given what's have allocate sure. strong your out I we why the be

do with the it. commercial want our out the From a to become consumer our we sheet firepower a on to perspective, a saw absolutely balance So we don't core go or sheet. is the And more if the we lending right? to side, balance business need lending have manufacturer, company strategy

we're competitive So there a us. conscious some conscious aggressively to and situation, of the capital over people or was if that and act to swing why protect We either absolutely in invest the side our of have ability, lending also interests.

Operator

McCanless from Our of of line comes next Wedbush. question Jay the

James McCanless

what of The have share the outstanding? at first authorization repurchase one, much was the you How did end 'XX? fiscal

Allison Aden

we have $XXX.X Yes, outstanding million the so of at on authorization. XXXX, end remaining the

James McCanless

$XXX.X million?

Allison Aden

Yes.

William Boor

an I even was we as Board and finishing $XXX then one, gave were us up the million additional remember last. finishing we up the

James McCanless

you how And still that, this it. opportunistic thinking or on repurchase are year? about Got for

Allison Aden

seen then just the a in operation. lending consistent responsibly the a out repurchases and responsibly We balance you've improvement, would we mentioned, as as really the manage allocation as to, we Also, Phil balance, we've active, share of our in and touched our And efficiency sheet. really our of way really stay as cash dollars as We evaluation ongoing historically, in we and stay have balance our use to M&A strategy, we effectiveness. during capital the opportunities plant into continue that like to on call, put market. the expansion foremost, and first

also opportunities [ seen quarter You've some seeing deviate when the and we'll from just in M&A our in market, quarter to on historically, the pipelines. based and in we're ] sometimes that of we're marketplace, activity upending

James McCanless

guess, going 'XX. that was Is then shipments quarter? think do it calendar plus manufacturers? Who you driving the XX% the the first I at industry to of guys quarter who back taking for And is in so this larger volume the point?

William Boor

it I my that really you'd to to dig what back longwinded think have answer regions into. Jay, goes the are

in I more time think long a it story those numbers. was taking. X isn't than a manufacturer quarter And regional variations it a of was for kind

the points. the of questions, I are products moving the trend, best that lower price you if would give we one are the touched So any on other

point a then So, differences general homes. and regional price lower movement toward you've got

price in that I seeing for share, good don't you based the lower material was plant limited positioned looking region spot any at. shifts were time. is at and a just the positioned that sweet you're that had So, growth But market that period in points in think data of on was

James McCanless

the your one going be And this pricing the then everyone to to a little to that pricing competitive? last having same trying bit pressure for I that is question on the as more more aggressive be was more is out where of still smaller, larger players you're compete sounds And is there to there. something regional seeing It players, ask. you're price? Or before, like

William Boor

think that gross price still into why seen haven't pretty I downturn distress. we haven't this pretty anyone off really reason in some Well, get financial strong in and we good presumably seen Everyone bigger margins coming years. X got reductions earnings Yes. is

financial of haven't people desperate So, been a distress. sense in

order motivation modest. talked the generalize out of that haven't very It And pricing that episodic a takes but reductions I or leakage has. small, we've trends players We call. really very we've and We it's seen on of even And see could lot the big location that of this that away. it's oriented. think that activity, had I small some about about amount the Whether I don't that. are think been

James McCanless

the is to. out that like about sounds but Well, find the way is to for so change and ways to right customers. fix everyone please their having general if it? figure to it think paraphrase, But price, well in industry pretty Okay. Is to need behaving I affordability this or on

William Boor

to retail Sure. product, right? is right lot in a trying And them of the store to that the get

Operator

I'm you. for Bill and President CEO, now this to time. Thank Boor, back questions to no it closing at showing like I'd turn further remarks.

William Boor

running I resulting time. all it in record was down the was history, from reduced in at net third-highest ago, plant more our years in a year not the time, we're a significantly one wanted only down income results. no when market we year. fiscal long, our I and the on that was a our doubled as I running doubt discussion. over look There's I Despite interest appreciate reflection this I had X short know the system everyone's 'XX on back at share a year pace looking to good income But which than

and of I just position come expectations before. in deliver in more a of homes than with we've great perspective, way like think in long front it improving a ever feel to So, us, I putting conditions really we're

forward we updated you in thank Cavco. you your on interest always, And for to our So, keeping all, progress. as look

Operator

for Thank conclude program. conference. does participation your the in you today's This

You may now disconnect.

Cavco Industries (CVCO) 24 May 242024 Q4 Earnings call transcript