Winnebago(WGO) - 2025 Q3 - Quarterly Report

PART I. FINANCIAL INFORMATION Item 1. Consolidated Financial Statements Presents unaudited consolidated financial statements for Q3 and YTD FY2025 and FY2024, with detailed notes on financial position and performance Consolidated Statements of Income Consolidated Statements of Income (Three Months Ended) | (in millions, except per share data) | May 31, 2025 | May 25, 2024 | Change ($) | Change (%) | | :---------------------------------- | :----------- | :----------- | :--------- | :--------- | | Net revenues | $775.1 | $786.0 | $(10.9) | (1.4)% | | Gross profit | $106.0 | $118.2 | $(12.2) | (10.3)% | | Operating income | $30.2 | $43.5 | $(13.4) | (30.7)% | | Net income | $17.6 | $29.0 | $(11.3) | (39.1)% | | Diluted EPS | $0.62 | $0.96 | $(0.34) | (35.4)% | Consolidated Statements of Income (Nine Months Ended) | (in millions, except per share data) | May 31, 2025 | May 25, 2024 | Change ($) | Change (%) | | :---------------------------------- | :----------- | :----------- | :--------- | :--------- | | Net revenues | $2,020.9 | $2,252.6 | $(231.7) | (10.3)% | | Gross profit | $265.9 | $339.3 | $(73.4) | (21.6)% | | Operating income | $37.1 | $118.0 | $(81.0) | (68.6)% | | Net income | $12.0 | $42.1 | $(30.1) | (71.4)% | | Diluted EPS | $0.42 | $1.40 | $(0.98) | (70.0)% | Consolidated Balance Sheets Consolidated Balance Sheet Highlights | (in millions) | May 31, 2025 | August 31, 2024 | | :------------------------ | :----------- | :-------------- | | Total assets | $2,132.7 | $2,384.2 | | Total liabilities | $916.8 | $1,110.9 | | Total shareholders' equity | $1,215.9 | $1,273.3 | | Cash and cash equivalents | $10.5 | $330.9 | | Inventories, net | $477.8 | $438.7 | | Long-term debt, net | $539.9 | $637.1 | Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows (Nine Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :-------------------------------------- | :----------- | :----------- | | Net cash (used in) provided by operating activities | $(52.5) | $103.2 | | Net cash used in investing activities | $(25.5) | $(36.4) | | Net cash used in financing activities | $(242.4) | $(58.6) | | Net (decrease) increase in cash and cash equivalents | $(320.4) | $8.2 | | Cash and cash equivalents at end of period | $10.5 | $318.1 | Consolidated Statements of Changes in Shareholders' Equity Shareholders' Equity Changes (Nine Months Ended May 31, 2025) | (in millions) | Amount | | :------------------------ | :----- | | Balances at August 31, 2024 | $1,273.3 | | Stock-based compensation | $12.2 | | Repurchase of common stock | $(54.1) | | Common stock dividends | $(29.0) | | Net income | $12.0 | | Balances at May 31, 2025 | $1,215.9 | Notes to Consolidated Financial Statements Note 1. Basis of Presentation Outlines the basis for preparing consolidated financial statements, including U.S. GAAP adherence, segment changes, and evaluation of new FASB pronouncements - A Grand Design motorhomes operating segment was established in the first quarter of Fiscal 2025 and included in the Motorhome RV reportable segment. Prior period amounts were not reclassified as the impact was not significant[23] - The company is evaluating the impact of new FASB ASUs: 2024-04 (convertible debt settlements), 2024-03 (disaggregated expense disclosures), 2023-09 (income tax disclosures), and 2023-07 (segment reporting disclosures)[26][27][28][30] Note 2. Business Segments Details the company's nine operating segments aggregated into three reportable segments: Towable RV, Motorhome RV, and Marine, with performance evaluated by Adjusted EBITDA - Winnebago Industries has nine operating segments grouped into three reportable segments: Towable RV, Motorhome RV, and Marine. Performance is assessed using Adjusted EBITDA[31][32][36] Segment Net Revenues (Three Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :------------ | :----------- | :----------- | | Towable RV | $371.7 | $386.3 | | Motorhome RV | $291.2 | $299.0 | | Marine | $100.7 | $87.9 | | Corporate / All Other | $11.5 | $12.8 | | Consolidated | $775.1 | $786.0 | Segment Adjusted EBITDA (Three Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :------------ | :----------- | :----------- | | Towable RV | $35.4 | $41.9 | | Motorhome RV | $3.0 | $13.4 | | Marine | $11.6 | $8.5 | | Corporate / All Other | $(3.5) | $(5.8) | | Consolidated | $46.5 | $58.0 | Note 3. Investments and Fair Value Measurements Details the company's fair value measurement approach, categorizing assets and liabilities by input transparency, and notes a $1.2 million asset impairment Assets Measured at Fair Value on a Recurring Basis (May 31, 2025) | (in millions) | Fair Value | Level 1 | Level 2 | Level 3 | | :------------------------ | :--------- | :------ | :------ | :------ | | Domestic equity funds | $2.1 | $2.1 | — | — | | International equity funds | $0.1 | $0.1 | — | — | | Total assets at fair value | $2.2 | $2.2 | — | — | - For the nine months ended May 31, 2025, the Company recognized an impairment of approximately $1.2 million related to non-financial assets. No impairment was recorded in the prior year period[44] Note 4. Inventories Provides a breakdown of inventory components and specifies the valuation methods used Inventories Breakdown (in millions) | Category | May 31, 2025 | August 31, 2024 | | :---------------- | :----------- | :-------------- | | Finished goods | $79.0 | $81.3 | | Work-in-process | $169.3 | $171.9 | | Raw materials | $281.0 | $237.6 | | Total | $529.3 | $490.8 | | Less: FIFO over LIFO cost | $51.5 | $52.1 | | Inventories, net | $477.8 | $438.7 | Note 5. Property, Plant, and Equipment Details the composition of property, plant, and equipment (PPE) at cost, net of accumulated depreciation, and reports depreciation expense Property, Plant, and Equipment, Net (in millions) | Category | May 31, 2025 | August 31, 2024 | | :------------------------------ | :----------- | :-------------- | | Land | $14.6 | $14.6 | | Buildings and building improvements | $278.8 | $279.3 | | Machinery and equipment | $181.0 | $171.8 | | Software | $81.0 | $72.0 | | Transportation | $7.5 | $7.8 | | Construction in progress | $29.3 | $24.5 | | Property, plant, and equipment, gross | $592.2 | $570.0 | | Less: Accumulated depreciation | $256.0 | $231.1 | | Property, plant, and equipment, net | $336.2 | $338.9 | - Depreciation expense was $9.6 million for the three months ended May 31, 2025 (up from $8.9 million YoY) and $28.7 million for the nine months ended May 31, 2025 (up from $25.5 million YoY)[48] Note 6. Goodwill and Intangible Assets Provides a breakdown of goodwill by reportable segment and details other intangible assets, net of accumulated amortization, including estimated future amortization expense Goodwill by Reportable Segment (in millions) | Segment | May 31, 2025 & August 31, 2024 | | :---------------------- | :----------------------------- | | Towable RV | $244.7 | | Motorhome RV | $73.1 | | Marine | $30.3 | | Corporate / All Other | $136.1 | | Total | $484.2 | Other Intangible Assets, Net (in millions) | Category | May 31, 2025 | August 31, 2024 | | :------------------------------ | :----------- | :-------------- | | Indefinite-lived trade names | $352.3 | $352.3 | | Finite-lived trade name | $2.9 | $3.3 | | Dealer networks/customer relationships | $80.4 | $92.1 | | Backlog | — | $0.4 | | Developed technology | $26.8 | $30.9 | | Other intangible assets, net | $462.4 | $479.0 | Estimated Future Amortization Expense (in millions) | Fiscal Year | Amortization | | :------------------ | :----------- | | Remainder of Fiscal 2025 | $5.4 | | Fiscal 2026 | $21.7 | | Fiscal 2027 | $21.7 | | Fiscal 2028 | $21.4 | | Fiscal 2029 | $15.5 | | Fiscal 2030 | $12.3 | | Thereafter | $12.1 | | Total | $110.1 | Note 7. Product Warranties Describes the company's product warranty policies and provides a table detailing changes in product warranty liability Changes in Product Warranty Liability (in millions) | Category | Three Months Ended May 31, 2025 | Three Months Ended May 25, 2024 | Nine Months Ended May 31, 2025 | Nine Months Ended May 25, 2024 | | :------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Balance at beginning of period | $66.7 | $89.3 | $78.9 | $97.8 | | Provision | $29.3 | $20.7 | $69.6 | $60.6 | | Claims paid | $(24.0) | $(25.0) | $(76.5) | $(73.4) | | Balance at end of period | $72.0 | $85.0 | $72.0 | $85.0 | Note 8. Debt Summarizes outstanding debt, including the ABL Credit Facility, Senior Secured Notes, and 2030 Convertible Notes, detailing terms and significant events Outstanding Debt (in millions) | Debt Type | May 31, 2025 | August 31, 2024 | | :------------------------ | :----------- | :-------------- | | ABL Credit Facility | $— | $— | | Senior Secured Notes | $200.0 | $300.0 | | 2030 Convertible Notes | $350.0 | $350.0 | | 2025 Convertible Notes | $— | $59.3 | | Total debt, gross | $550.0 | $709.3 | - On February 20, 2025, $100.0 million aggregate principal amount of Senior Secured Notes were tendered and accepted, resulting in a $2.0 million loss on note repurchase[59] - The 2025 Convertible Notes matured on April 1, 2025, and were fully repaid with $59.3 million in principal and $0.4 million in accrued interest using cash on hand, with no shares of common stock issued[78] Aggregate Contractual Maturities of Debt (in millions) | Fiscal Year | Amount | | :------------------ | :----- | | Remainder of Fiscal 2025 | $— | | Fiscal 2026 | $— | | Fiscal 2027 | $— | | Fiscal 2028 | $200.0 | | Fiscal 2029 | $— | | Fiscal 2030 | $350.0 | | Total debt, gross | $550.0 | Note 9. Contingent Liabilities and Commitments Discusses repurchase commitments with lending institutions for dealer floorplan financing and addresses ongoing litigation - Total contingent liability on repurchase agreements was approximately $1,707.2 million at May 31, 2025, an increase from $1,673.7 million at August 31, 2024[85] - The repurchase accrual was $1.2 million at May 31, 2025, up from $1.1 million at August 31, 2024[86] Note 10. Revenue Disaggregates revenue by reportable segment and product category, primarily from sales to independent dealer networks Net Revenues by Segment and Product Category (Three Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :------------ | :----------- | :----------- | | Towable RV| | | | Fifth Wheel | $186.1 | $195.3 | | Travel Trailer| $177.9 | $183.0 | | Other | $7.7 | $8.0 | | Total Towable RV | $371.7 | $386.3 | | Motorhome RV| | | | Class A | $118.2 | $124.4 | | Class B | $29.6 | $60.2 | | Class C and Other | $143.4 | $114.4 | | Total Motorhome RV | $291.2 | $299.0 | | Marine | $100.7 | $87.9 | | Corporate / All Other | $11.5 | $12.8 | | Consolidated Net Revenues | $775.1 | $786.0 | Net Revenues by Segment and Product Category (Nine Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :------------ | :----------- | :----------- | | Towable RV| | | | Fifth Wheel | $464.8 | $501.4 | | Travel Trailer| $426.0 | $475.3 | | Other | $23.1 | $25.1 | | Total Towable RV | $913.9 | $1,001.8 | | Motorhome RV| | | | Class A | $324.5 | $420.2 | | Class B | $114.1 | $209.5 | | Class C and Other | $359.9 | $342.1 | | Total Motorhome RV | $798.5 | $971.8 | | Marine | $272.9 | $245.0 | | Corporate / All Other | $35.6 | $34.0 | | Consolidated Net Revenues | $2,020.9 | $2,252.6 | Note 11. Income Taxes Provides effective tax rates and explains primary drivers for changes, including R&D credits, reserve releases, and non-deductible losses Effective Tax Rates | Period | May 31, 2025 | May 25, 2024 | | :------------------------ | :----------- | :----------- | | Three Months Ended | 26.3% | 18.4% | | Nine Months Ended | 28.5% | 34.5% | - The increase in the effective tax rate for the three months ended May 31, 2025, was primarily due to prior year's favorable R&D credit increase and reserve release, alongside lower current year income. The decrease for the nine months was mainly due to the prior year's non-deductible loss on note repurchase[91] Note 12. Earnings Per Share Details the calculation of basic and diluted earnings per share, outlining net income and weighted average common shares outstanding Earnings Per Share (Three Months Ended) | (in millions, except per share data) | May 31, 2025 | May 25, 2024 | | :---------------------------------- | :----------- | :----------- | | Basic earnings per common share | $0.63 | $0.99 | | Diluted earnings per common share | $0.62 | $0.96 | | Weighted average common shares outstanding (Basic) | 28.0 | 29.2 | | Weighted average common shares outstanding (Diluted) | 28.4 | 30.4 | Earnings Per Share (Nine Months Ended) | (in millions, except per share data) | May 31, 2025 | May 25, 2024 | | :---------------------------------- | :----------- | :----------- | | Basic earnings per common share | $0.43 | $1.43 | | Diluted earnings per common share | $0.42 | $1.40 | | Weighted average common shares outstanding (Basic) | 28.3 | 29.3 | | Weighted average common shares outstanding (Diluted) | 28.4 | 30.6 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Provides management's perspective on financial condition, results of operations, liquidity, and factors affecting future results, including segment updates and non-GAAP measures Overview Winnebago Industries, a leading outdoor lifestyle product manufacturer, faces macroeconomic challenges impacting sales and demand, prompting strategic business transformation - Winnebago Industries is a leading North American manufacturer of outdoor lifestyle products (RVs, marine) and advanced battery solutions, distributed primarily through independent dealers in the U.S. and Canada[98] - The business faces challenges from macroeconomic conditions including inflation, elevated interest rates, and lower consumer confidence, leading to decreased sales and reduced short-term demand for discretionary products[99] - The company is transforming its Winnebago motorhome business by lowering field inventory, improving working capital, aligning production to market demand, and enhancing product value[99] Non-GAAP Financial Measures Defines EBITDA and Adjusted EBITDA, outlining the adjustments made to present comparable financial results - EBITDA is defined as net income before interest expense, provision for income taxes, and depreciation and amortization expense[103] - Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation and amortization expense, and other pretax adjustments (e.g., acquisition-related costs, contingent consideration fair value adjustment, loss on note repurchase, asset impairment, non-operating income or loss) to present comparable results[103][105] Results of Operations - Three Months Ended May 31, 2025 Compared to Three Months Ended May 25, 2024 Consolidated net revenues decreased by 1.4% to $775.1 million, driven by product mix and Motorhome RV volume declines, while gross profit margin, operating income, and net income also decreased Consolidated Performance Summary Consolidated Performance Summary (Three Months Ended) | ($ in millions, except per share data) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :----------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $775.1 | $786.0 | $(10.9) | (1.4)% | | Gross profit | $106.0 | $118.2 | $(12.2) | (10.3)% | | Operating income | $30.2 | $43.5 | $(13.4) | (30.7)% | | Net income | $17.6 | $29.0 | $(11.3) | (39.1)% | | Diluted earnings per share | $0.62 | $0.96 | $(0.34) | (35.4)% | - Net revenues decreased primarily due to a reduction in average selling price per unit related to product mix, partially offset by targeted price increases. Unit volume growth in Towable RV and Marine segments was offset by declines in Motorhome RV[107] - Gross profit as a percentage of revenue decreased primarily due to higher warranty experience and deleverage associated with product mix, partially offset by operational efficiencies[108] Non-GAAP Reconciliation Consolidated EBITDA and Adjusted EBITDA (Three Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :-------------------- | :----------- | :----------- | | Net income | $17.6 | $29.0 | | EBITDA | $45.7 | $55.8 | | Adjusted EBITDA | $46.5 | $58.0 | Reportable Segment Performance Summary Towable RV Towable RV Performance (Three Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $371.7 | $386.3 | $(14.7) | (3.8)% | | Adjusted EBITDA | $35.4 | $41.9 | $(6.6) | (15.7)% | | Average Selling Price (ASP) | $38,934 | $41,638 | $(2,704) | (6.5)% | | Unit deliveries | 9,495 | 9,263 | 232 | 2.5% | - Net revenues decreased primarily due to a shift in product mix toward lower price-point models, partially offset by higher unit volume[112] Motorhome RV Motorhome RV Performance (Three Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $291.2 | $299.0 | $(7.9) | (2.6)% | | Adjusted EBITDA | $3.0 | $13.4 | $(10.4) | (77.7)% | | Average Selling Price (ASP) | $208,146 | $183,568 | $24,578 | 13.4% | | Unit deliveries | 1,431 | 1,680 | (249) | (14.8)% | - Net revenues decreased primarily due to lower unit volume related to current market conditions, partially offset by product mix[114] - Adjusted EBITDA margin decreased primarily due to higher discounts and allowances, volume deleverage, and operational inefficiencies within the Winnebago motorhome business[115] Marine Marine Performance (Three Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $100.7 | $87.9 | $12.8 | 14.6% | | Adjusted EBITDA | $11.6 | $8.5 | $3.1 | 37.0% | | Average Selling Price (ASP) | $81,185 | $78,595 | $2,590 | 3.3% | | Unit deliveries | 1,254 | 1,127 | 127 | 11.3% | - Net revenues increased primarily due to unit volume and targeted price increases, partially offset by product mix[116] Results of Operations - Nine Months Ended May 31, 2025 Compared to the Nine Months Ended May 25, 2024 Consolidated net revenues decreased by 10.3% to $2,020.9 million, driven by lower unit volume and product mix, with significant declines in gross profit, operating income, and net income Consolidated Performance Summary Consolidated Performance Summary (Nine Months Ended) | ($ in millions, except per share data) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :----------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $2,020.9 | $2,252.6 | $(231.7) | (10.3)% | | Gross profit | $265.9 | $339.3 | $(73.4) | (21.6)% | | Operating income | $37.1 | $118.0 | $(81.0) | (68.6)% | | Net income | $12.0 | $42.1 | $(30.1) | (71.4)% | | Diluted earnings per share | $0.42 | $1.40 | $(0.98) | (70.0)% | - Net revenues decreased primarily due to a reduction in average selling price per unit related to product mix and lower unit volume, partially offset by targeted price increases[118] - Gross profit as a percentage of revenue decreased primarily due to deleverage, including that associated with product mix, and higher warranty experience, partially offset by operational efficiencies[119] - Interest expense, net increased primarily due to the 2030 Convertible Notes issued in the second quarter of 2024[120] Non-GAAP Reconciliation Consolidated EBITDA and Adjusted EBITDA (Nine Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :-------------------- | :----------- | :----------- | | Net income | $12.0 | $42.1 | | EBITDA | $81.5 | $121.9 | | Adjusted EBITDA | $83.7 | $161.9 | Reportable Segment Performance Summary Towable RV Towable RV Performance (Nine Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $913.9 | $1,001.8 | $(87.9) | (8.8)% | | Adjusted EBITDA | $66.0 | $101.8 | $(35.9) | (35.2)% | | Average Selling Price (ASP) | $38,906 | $41,841 | $(2,935) | (7.0)% | | Unit deliveries | 23,336 | 23,856 | (520) | (2.2)% | | Dealer Inventory (Units) | 17,747 | 18,110 | (363) | (2.0)% | - Net revenues decreased primarily due to a shift in product mix toward lower price-point models and lower unit volume due to market conditions, partially offset by targeted price increases[124] Motorhome RV Motorhome RV Performance (Nine Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $798.5 | $971.8 | $(173.3) | (17.8)% | | Adjusted EBITDA | $10.9 | $60.7 | $(49.8) | (82.0)% | | Average Selling Price (ASP) | $204,588 | $189,356 | $15,232 | 8.0% | | Unit deliveries | 3,997 | 5,212 | (1,215) | (23.3)% | | Dealer Inventory (Units) | 3,614 | 4,386 | (772) | (17.6)% | - Net revenues decreased primarily due to lower unit volume related to market conditions, partially offset by the introduction of the Grand Design motorhome business and product mix[127] - Adjusted EBITDA margin decreased primarily due to volume deleverage, operational inefficiencies, and higher discounts and allowances associated with the Winnebago motorhome business[128] Marine Marine Performance (Nine Months Ended) | (in millions, except ASP and units) | May 31, 2025 | May 25, 2024 | $ Change | % Change | | :---------------------------------- | :----------- | :----------- | :------- | :------- | | Net revenues | $272.9 | $245.0 | $27.9 | 11.4% | | Adjusted EBITDA | $27.7 | $20.1 | $7.6 | 38.1% | | Average Selling Price (ASP) | $79,846 | $80,819 | $(973) | (1.2)% | | Unit deliveries | 3,471 | 3,107 | 364 | 11.7% | | Dealer Inventory (Units) | 3,069 | 3,400 | (331) | (9.7)% | - Net revenues increased primarily due to unit volume and targeted price increases, partially offset by a reduction in average selling price per unit related to product mix[130] Analysis of Financial Condition, Liquidity, and Capital Resources Analyzes cash flows, debt, working capital, and share repurchases, highlighting decreased operating cash flow and increased financing activities, while maintaining sufficient liquidity Cash Flows Summary of Cash Flows (Nine Months Ended) | (in millions) | May 31, 2025 | May 25, 2024 | | :-------------------------------------- | :----------- | :----------- | | Total cash (used in) provided by: | | | | Operating activities | $(52.5) | $103.2 | | Investing activities | $(25.5) | $(36.4) | | Financing activities | $(242.4) | $(58.6) | | Net (decrease) increase in cash and cash equivalents | $(320.4) | $8.2 | - Net cash used in operating activities was $52.5 million, a significant decrease from $103.2 million provided in the prior year, driven by lower profitability, increased inventory, and higher accounts receivable[133] - Cash used in financing activities increased primarily due to partial settlement of high-yield notes and the maturity of 2025 Convertible Notes[135] Debt and Capital - The company maintains a $350.0 million ABL Credit Facility, which was undrawn as of May 31, 2025, with a maturity date of July 15, 2027[136] - As of May 31, 2025, the company had $10.5 million in cash and cash equivalents and $350.0 million in unused ABL Credit Facility[136] - The 2025 Convertible Notes matured on April 1, 2025, and were fully settled with cash on hand ($59.3 million principal, $0.4 million accrued interest)[139] Working Capital Working Capital (in millions) | Period | Amount | | :------------ | :----- | | May 31, 2025 | $444.2 | | August 31, 2024 | $584.0 | Share Repurchases - The Board of Directors authorized a $350.0 million share repurchase program on August 17, 2022, with no time restriction[144] - In the nine months ended May 31, 2025, the company repurchased approximately 951,000 shares for $50.0 million under this authorization, and 64,000 shares for $3.6 million to satisfy tax obligations on employee equity awards[144] - As of May 31, 2025, $180.0 million remained on the Board-approved repurchase authorization[144] - A quarterly cash dividend of $0.34 per share was approved on May 16, 2025, payable on June 25, 2025[145] Contractual Obligations and Commercial Commitments - There have been no material changes in contractual obligations since the end of Fiscal 2024[146] Critical Accounting Estimates - There have been no material changes to critical accounting policies or estimates since the end of Fiscal 2024[147] Recently Issued Accounting Pronouncements - For a summary of new applicable accounting pronouncements, refer to Note 1 in the Notes to Consolidated Financial Statements[148] Safe Harbor Statement Under the Private Securities Litigation Reform Act - The report contains forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially[149] - Important factors include general economic uncertainty, financing availability for dealers/retailers, competition, ability to innovate, inventory management, cyclicality, dealer risks, increased repurchase obligations, supply chain issues, material costs, M&A integration, personnel retention, warranty claims, IT security, brand reputation, governmental regulation, ESG matters, goodwill impairment, and risks related to convertible notes[151] Item 3. Quantitative and Qualitative Disclosures About Market Risk Addresses the company's exposure to market risks, noting that deferred compensation asset risk is borne by participants and the ABL Credit Facility is the only undrawn floating rate debt - Assets funding deferred compensation have market risk, but this risk is borne by the participants due to a corresponding liability[152] - The ABL Credit Facility is the company's only floating rate debt instrument and remains undrawn as of May 31, 2025[153] Item 4. Controls and Procedures Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of May 31, 2025, with no material changes in internal control over financial reporting - Disclosure controls and procedures were evaluated and concluded to be effective as of May 31, 2025[154] - There were no material changes in internal control over financial reporting during the third quarter of Fiscal 2025[155] PART II. OTHER INFORMATION Item 1. Legal Proceedings Refers to Note 9 in the Consolidated Financial Statements for a description of the company's legal proceedings - For a description of legal proceedings, refer to Note 9 in the Notes to Consolidated Financial Statements[156] Item 1A. Risk Factors States that there have been no material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended August 31, 2024 - There have been no material changes from the risk factors previously disclosed in the Annual Report on Form 10-K for the fiscal year ended August 31, 2024[157] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Details the company's stock repurchase activities during the third quarter of Fiscal 2025, including shares repurchased under the Board-authorized program and for tax obligations Stock Repurchases (Third Quarter Fiscal 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in millions) | | :-------------- | :------------------------------- | :--------------------------- | :--------------------------------------------------------------------------------------------------- | | 3/2/25 - 4/5/25 | — | $— | $180.0 | | 4/6/25 - 5/3/25 | 469 | $32.06 | $180.0 | | 5/4/25 - 5/31/25| 779 | $34.44 | $180.0 | | Total | 1,248 | $33.54 | $180.0 | - Shares not purchased as part of a publicly announced program were repurchased from employees who vested in Company shares and elected to pay their payroll tax via the value of shares delivered as opposed to cash[158] Item 5. Other Information Confirms that no director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the quarter ended May 31, 2025 - No director or officer adopted, modified, or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the quarter ended May 31, 2025[159] Item 6. Exhibits Lists the exhibits filed as part of the Form 10-Q, including organizational documents, debt indentures, certifications, and XBRL interactive data files - Key exhibits include Articles of Incorporation, Bylaws, Indentures for Senior Secured Notes and 2030 Convertible Notes, Certifications by CEO and CFO (Sections 302 and 906), and various XBRL documents[160] SIGNATURES SIGNATURES Contains the official signatures of the Chief Executive Officer and Chief Financial Officer, certifying the filing of the report on behalf of Winnebago Industries, Inc