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Caravanning News is registered with the National Library of Australia's PANDORA archive

December 2017



Coromal caravans Caravan sales stall


'Skew' expected in second half'

External review after
Fleetwood sales stall

By Dennis Amor
Have your say

FLEETWOOD has ordered a review of its recreational vehicles business.

This follows news that the Perth-based manufacturer of Windsor and Coromal caravans has seen its rising sales come to a standstill.

Managing director Brad Denison broke the news to shareholders at the company's annual general meeting.

"The recovery in volume we saw in the caravan manufacturing business in 2017 (financial year), where revenue increased by 50 percent, has stalled in the first half of 2018 on the back of very unstable industry volume," he said.

"So in line with our previous communications to you about the time frame we had set for the business to recover, the board has taken the next step which involves an external review of the business."

Mr Denison said new products had been introduced to the market, the first being its revamped Princeton caravan boasting the largest electronic slide out unit on the market today.

At 4.5m, it was attracting much attention at caravan shows.

He said Fleetwood now had 22 dealerships, with 15 of them exclusively selling Coromal and Windsor products.

"This couldn't have been achieved without the major push into developing new products," he explained.

Although the improvement in sales and market share had come at a cost, with the factory in a very inefficient state while it rapidly prototyped new units and at the same time ramped production to meet the increased demand.

This had meant that in 2017 the business delivered unsatisfactory earnings.

"And there is also another factor which has come into play at the start of 2018, in that we are seeing very unstable market conditions in the industry as a whole for the first time in many years," Mr Denison told shareholders.

"Although we have been outperforming most of our competitors at recent caravan shows, sales growth in the early part of the 2018 year stalled.

"And while 2018 earnings in this business look at this stage to be roughly in line with 2017, there will be a skew to the second half.

"So from a broader perspective, and given this financial performance, the board has established a fully independent strategic review of the business."

He stressed there were no plans to discontinue the business.

"This review, which is being undertaken by a reputable external firm, is covering - among other factors - the competitive environment and the business structure including its manufacturing locations.

"The result will be the identification of options the board has with respect to the business."

The results of the review will be available for discussion along with the company's half-year result announcement in February.


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Copyright 2005 Dennis Amor
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