SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): September 28, 1999
------------------------------
OAKWOOD HOMES CORPORATION
-------------------------
(Exact name of registrant as specified in charter)
<TABLE>
<CAPTION>
<S> <C> <C>
North Carolina 1-7444 56-0985879
- ----------------------------------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) file number) Identification Number)
</TABLE>
7800 McCloud Road, Greensboro, North Carolina 27409-9634
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (336) 664-2400
-----------------------------
<PAGE>
ITEM 5. OTHER EVENTS.
On September 28, 1999, the Registrant issued a press release, a copy of
which is attached hereto as Exhibit 99.1.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) EXHIBITS. The following exhibit is filed herewith:
99.1 Press release issued on September 28, 1999.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OAKWOOD HOMES CORPORATION
Date: September 29, 1999 By:/s/Robert A. Smith
-----------------------------------------
Name: Robert A. Smith
Title: Executive Vice President and
Chief Financial Officer
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC
EXHIBITS
CURRENT REPORT
ON
FORM 8-K
Date of Event Reported: Commission File No:
September 28, 1999 1-7444
<TABLE>
<CAPTION>
OAKWOOD HOMES CORPORATION
EXHIBIT INDEX
<S> <C> <C> <C> <C> <C> <C>
Exhibit No. Exhibit Description
----------- -------------------
99.1 Press release issued on September 28, 1999.
</TABLE>
EXHIBIT 99.1
Contact: Suzanne H. Wood
(336) 664-2400
OAKWOOD HOMES CORPORATION ANNOUNCES
CHARGE RELATED TO OPERATIONAL RESTRUCTURING
AND ANTICIPATED FOURTH QUARTER OPERATING LOSS
GREENSBORO, N.C., September 28, 1999 -- Oakwood Homes Corporation (NYSE - OH)
today announced that its financial results for the fourth quarter ending
September 30, 1999 will include a charge related to the restructuring of its
operations. As a result of the restructuring charge, along with other matters
affecting operations described below, the Company currently estimates that it
will report a net loss for its fourth quarter of approximately $60 million to
$65 million on an after-tax basis.
During the quarter, the Company closed four manufacturing plants, three of which
had been previously announced, and temporarily idled five others. It also closed
40 sales centers that were not meeting profitability targets. Certain assets
utilized in the affected operations were written down to their net realizable
value. The Company also incurred severance and other benefit-related costs for
approximately 1,900 employees impacted by these and other actions during the
quarter. As a result, the Company estimates that it will report a restructuring
charge of approximately $30 million before tax.
William G. Edwards, President and Chief Operating Officer, stated: "We did not
exit any markets as a result of these actions. Rather, we maintained our core
presence and should be well-positioned to take advantage of improved industry
conditions when they present themselves.
"The restructuring activities undertaken are part of a broader plan to
fundamentally change our business. The actions taken will reposition our Company
to allow it to be more flexible in its response to the market and less sensitive
to periodic declines in sales. Our plan focuses on improving sales productivity,
reducing costs and retail break-even points, lowering inventory levels and
improving cash flows. In addition, our plan reflects our commitment to improving
our financial services operations. To that end, we have reorganized the finance
company during the quarter. Under new leadership, we decentralized our credit
and collections functions on a regional basis. We also instituted a series of
key measurements to track progress and drive improvements in efficiency and
effectiveness. We believe strongly that we have taken the appropriate steps to
improve our business and its financial results over the long term."
Nicholas J. St. George, Chairman and Chief Executive Officer, and Mr. Edwards
jointly said: "The difficult industry environment in which we are operating has
been well-publicized. The industry is characterized by an excessive number of
retail outlets and high inventory levels. As a result, our fourth quarter will
be adversely affected by continued softness in sales, competitive pricing
pressures at retail and unfavorable manufacturing variances resulting from
reduced operating schedules. While we do not expect our housing operations to be
profitable for the quarter, we do expect them to be profitable for the year.
<PAGE>
"In addition, conditions in the asset-backed securities market continue to be
unfavorable. We will report a pre-tax loss approximating $7.5 million on our
most recent loan securitization due in large part to historically wide spreads
in the asset-backed markets and the upward movement in treasury rates from the
time the loans were originated to the time they were securitized.
"Operating results for the quarter will also include pre-tax charges of
approximately $25 million relating to the impairment of the value of certain
retained interests in loan securitizations and other financial service-related
charges. The writedowns relate primarily to loans originated during 1998 that
have experienced higher-than-expected default rates.
"Not surprisingly, flooding and other storm damage claims from Hurricane Floyd
will negatively impact our insurance operations. Although we will not know the
total amount of losses from this storm for a few weeks, we currently expect that
the storm will negatively affect our insurance operations by approximately $8
million on a pre-tax basis, net of recovery from our reinsurers."
Mr. Edwards concluded by saying: "We are certainly disappointed by our operating
results. We believe that we are taking the necessary actions to both respond to
the current environment and position ourselves for the future. We have already
taken actions that will significantly lower our cost structure and change the
way in which we deliver our products to the market. The steps we have taken to
date along with the continued implementation of our plan will allow us to be an
even higher value provider of affordable housing."
This press release contains certain forward-looking statements and information
based on the beliefs of the Company's management as well as assumptions made by,
and information currently available to, the Company's management. Words like
"believe," "expect," "should," and similar expressions used in this press
release are intended to identify forward-looking statements. Such statements
reflect the current views of the Company with respect to future events and are
subject to certain risks, uncertainties, and assumptions, including risk factors
in the Company's Registration Statement on Form S-3 filed February 22, 1999.
Should underlying assumptions prove incorrect or should one or more of the risks
or uncertainties materialize, actual events or results may vary from those
described herein as anticipated, expected, believed or estimated.
Oakwood Homes Corporation and its subsidiaries are engaged in the production,
sale, financing and insuring of manufactured housing throughout the United
States.
