SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
( X ) Quarterly report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended December 31, 1997 or ( )
Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act
of 1934 for the transition period from _______ to _______
Commission File Number 1-7444
OAKWOOD HOMES CORPORATION
--------------------------
(Exact name of registrant as specified in its charter)
North Carolina 56-0985879
-------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7800 McCloud Road, Greensboro, North Carolina
----------------------------------------------
27409-9734
(Address of principal executive offices)
Post Office Box 27081, Greensboro, North Carolina
-------------------------------------------------
27425-7081
(Mailing address of principal executive offices)
(336) 664-2400
--------------
(Registrant's telephone number, including area code)
-----------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months, and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
------ -------
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock as of January 31, 1998.
Common Stock, Par Value $.50 Per Share . . . . . . . . . .46,466,494
1
<PAGE>
QUARTERLY REPORT ON FORM 10-Q
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the Quarter Ended December 31, 1997
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
Greensboro, North Carolina
The consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and disclosures
normally included in annual financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted pursuant
to such rules and regulations, although the Company believes that the
disclosures contained herein are adequate to make the information presented not
misleading. These consolidated financial statements should be read in
conjunction with the financial statements and the notes thereto included in the
Company's latest annual report on Form 10-K.
2
<PAGE>
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
(in thousands except per share data)
<TABLE>
<CAPTION>
Three months ended
December 31,
----------------
1997 1996
---- ----
<S> <C> <C>
Revenues
Net sales $221,893 $177,782
Financial services income 30,479 24,772
Other income 2,291 4,636
-------- --------
Total revenues 254,663 207,190
-------- --------
Costs and expenses
Cost of sales 151,826 123,812
Selling, general and administrative expenses 58,461 48,367
Financial services operating expenses 11,037 5,784
Interest expense
Non-financial services 707 832
Financial services 3,919 3,489
-------- --------
Total costs and expenses 225,950 182,284
-------- --------
Income before income taxes 28,713 24,906
Provision for income taxes 10,911 9,713
-------- --------
Net income $ 17,802 $ 15,193
======== ========
Earnings per share
Basic $ .39 $ .33
Diluted $ .38 $ .33
Dividends per share $ .01 $ .01
Average shares outstanding
Basic 46,050 45,413
Diluted 47,331 46,732
</TABLE>
3
<PAGE>
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (UNAUDITED)
(in thousands except share and per share data)
<TABLE>
<CAPTION>
December 31, September 30,
1997 1997
---- ----
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 39,411 $ 28,717
Receivables and investments 377,891 462,080
Inventories
Manufactured homes 217,698 186,767
Work-in-process, materials and supplies 20,359 17,672
Land/homes under development 4,159 3,859
--------- ---------
242,216 208,298
Properties and facilities 143,631 139,702
Deferred income taxes 13,897 12,994
Other assets 73,297 52,715
--------- ---------
$ 890,343 $ 904,506
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Short-term borrowings $ 166,859 $ 175,800
Notes and bonds payable 72,989 78,815
Accounts payable and accrued liabilities 99,072 122,162
Insurance policy reserves 33,492 30,535
Other long-term obligations 14,924 13,312
Shareholders' equity
Common stock, $.50 par value; 100,000,000
shares authorized; 46,440,000 and 46,299,000
shares issued and outstanding 23,220 23,149
Additional paid-in capital 160,604 159,281
Retained earnings 323,872 306,533
--------- ---------
507,696 488,963
Less: Unearned compensation (4,689) (5,081)
--------- ---------
503,007 483,882
--------- ---------
$ 890,343 $ 904,506
========= =========
</TABLE>
4
<PAGE>
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
Three months ended
December 31,
---------------------
1997 1996
---- ----
<S> <C> <C>
Operating activities
Net income $ 17,802 $ 15,193
Items not requiring (providing) cash
Depreciation and amortization 4,454 3,210
Deferred income taxes (903) 130
Gain on sale of loans (5,859) (4,964)
Other 4,432 744
Decrease in other receivables 715 25,044
(Increase) in inventories (33,918) (33,826)
(Increase) in prepaid expenses (1,019) (1,511)
(Increase) decrease in deferred insurance policy
acquisition costs (289) 195
(Decrease) in accounts payable and accrued liabilities (22,849) (75,079)
Increase (decrease) in insurance policy reserves 2,957 (473)
Increase in other long-term obligations 733 107
--------- ---------
Cash (used) by operations (33,744) (71,230)
Loans originated (195,991) (174,297)
Sale of loans 271,035 291,912
Principal receipts on loans 9,454 7,426
--------- ---------
Cash provided by operating activities 50,754 53,811
--------- ---------
Investing activities
Investment in and advances to joint venture (21,954) (25,000)
Additions to properties and facilities (7,892) (6,181)
Other 3,679 (1,078)
--------- ---------
Cash (used) by investing activities (26,167) (32,259)
--------- ---------
Financing activities
Net repayments on short-term credit facilities (8,941) (19,606)
Payments on notes and bonds (5,706) (11,477)
Cash dividends (463) (457)
Proceeds from exercise of stock options 1,217 1,387
--------- ---------
Cash (used) by financing activities (13,893) (30,153)
--------- ---------
Net increase (decrease) in cash and cash equivalents 10,694 (8,601)
Cash and cash equivalents
Beginning of period 28,717 28,577
--------- ---------
End of period $ 39,411 $ 19,976
========= =========
</TABLE>
5
<PAGE>
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
1. The consolidated financial statements reflect all adjustments, which
included only normal recurring adjustments, which are, in the opinion of
management, necessary to present fairly the results of operations for the
periods presented. Results of operations for any interim period are not
necessarily indicative of results to be expected for a full year.
2. The Company adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("FAS 128"), which establishes standards for computing
and presenting earnings per share ("EPS") by replacing the presentation of
primary and fully diluted EPS with a presentation of basic and diluted EPS.
All current and prior year EPS amounts herein reflect adoption of FAS 128.
3. The Company is contingently liable as guarantor on installment sale
contracts sold to third parties on a full or limited recourse basis. The
amount of this contingent liability was approximately $53 million at
December 31, 1997. The Company is also contingently liable as guarantor on
subordinated securities issued by REMIC trusts in the aggregate principal
amount of $40 million at December 31, 1997. In addition, the Company is
contingently liable under terms of repurchase agreements with financial
institutions providing inventory financing for retailers of homes produced
by Destiny and Golden West Homes, manufacturing subsidiaries of the Company
doing business with independent dealers. The Company estimates that its
potential obligation under repurchase agreements approximated $28 million
at December 31, 1997.
6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
------------------------------------------------
RESULTS OF OPERATIONS
---------------------
Three months ended December 31, 1997 compared to three months ended December 31,
- -------------------------------------------------------------------------------
1996
- ----
The following table summarizes certain key statistics for the quarters
ended December 31, 1997 and 1996 :
<TABLE>
<CAPTION>
1997 1996
------ ------
<S> <C> <C>
Retail sales (in millions) $ 201.6 $ 150.2
Other sales (in millions) $ 20.3 $ 27.6
Total sales (in millions) $ 221.9 $ 177.8
Gross profit % 31.6% 30.4%
New single-section homes sold - retail 2,136 2,243
New multi-section homes sold - retail 2,595 1,639
Used homes sold - retail 549 456
New single-section homes sold - wholesale 75 211
New multi-section homes sold - wholesale 518 721
Average new single-section sales price - retail $30,100 $29,100
Average new multi-section sales price - retail $51,100 $49,600
Average new single-section sales price - wholesale $16,700 $14,600
Average new multi-section sales price - wholesale $35,700 $31,200
Weighted average retail sales centers
open during the period 305 259
</TABLE>
Retail sales dollar volume increased 34%, reflecting a 22% increase in
new unit volume, 3% increases in the average new single-section and new
multi-section sales prices and an increase in the percentage of total retail new
unit volume represented by multi-section homes from 42% last year to 55% in the
first quarter of fiscal 1998. Single-section unit volume decreased 5%, while
multi-section unit volume rose 58% from the first quarter of fiscal 1997. The
average selling prices for new single-section and new multi-section homes sold
at retail increased primarily due to a shift in product mix toward higher price
points. The retail sales increase reflects the effects of the Company's capacity
realignment towards multi-section homes late in the second quarter of fiscal
1997. Redirecting manufacturing capacity to multi-section products helped reduce
manufacturing backlogs and enabled the Company to offer a broader assortment of
products to consumers which management believes contributed to the increase in
multi-section unit sales. The increase in multi-section home sales during the
first quarter of fiscal 1998 is also attributable to the continuing success of
the Sunrise Dream Home and the introduction of the Family Dream Home(TM), the
second in a series of standardized homes supported by national marketing
campaigns. Over 1,100 homes in the Dream Home series were sold
7
<PAGE>
during the first quarter of fiscal 1998. During the first quarter of fiscal
1998, the Company opened or acquired 11 new sales centers compared to 7 sales
centers in the first quarter of fiscal 1997. Total new retail sales dollars at
sales centers open more than one year increased 15% during the first quarter of
fiscal 1998.
Other sales dollar volume declined by 26%, reflecting a 36% decrease in
wholesale unit volume. This decrease was offset by increases of 14% in the
average sales price of both new single-section homes and new multi-section homes
due to a shift in product mix toward higher price points, as well as price
increases. The decline in wholesale unit volume reflects the Company's strategy
of changing the distribution of products produced by Golden West and Destiny
from non-exclusive independent dealers to Company-owned retail sales centers.
During the quarter ended December 31, 1997, 72% of Golden West's and Destiny's
shipments were to Oakwood sales centers, compared to 55% in the first quarter of
fiscal 1997. Golden West and Destiny were acquired by the Company in 1994 and
1995, respectively. Prior to the acquisitions, these companies sold their
products exclusively at wholesale to independent retailers.
Gross profit margin increased to 31.6% during the quarter ended
December 31, 1997 from 30.4% in the first quarter of fiscal 1997, reflecting
higher operating levels and efficiencies in manufacturing and the reduced
significance of relatively lower margin wholesale sales. Manufacturing
production for the first quarter of fiscal 1998 increased 11% over the first
quarter of fiscal 1997. The percentage of new homes sold at retail which were
produced in Company-owned manufacturing plants decreased slightly from
approximately 95% in the quarter ended December 31, 1996 to approximately 94% in
the first quarter of fiscal 1998.
Financial services income increased to $30.5 million from $24.8 million
for the first quarter of last year. Interest income earned on loans held for
investment and on loans held for sale prior to securitization decreased from
$7.3 million in the first quarter of fiscal 1997 to $7.2 million this year. This
decrease reflects the decline in the principal balance of loans held for
investment and loans held for sale, as well as a decrease in the average yield
on those assets as older, higher-yielding loans are liquidated. The Company
continues to sell via securitization substantially all the loans it originates,
and accordingly interest income should continue to decline as the remaining
loans held for investment are liquidated. Loan servicing fees increased from
$4.9 million in the first quarter of fiscal 1997 to $6.5 million this year,
reflecting the increased size of the Company's securitized loan servicing
portfolio. REMIC residual income decreased from $6.1 million to $3.0 million,
reflecting a decrease in the average yield on those investments, arising
principally from higher credit losses more fully described below. This decrease
was slightly offset by an increase in the average balance of REMIC residual
interests during the period.
The Company estimates the fair value of retained residual interests in
REMIC securitizations based upon default, credit loss, voluntary prepayment and
interest rate assumptions which management believes market participants would
use for similar instruments. Such estimated fair values have a direct impact on
the magnitude of the gain or loss recorded on the sale of asset-backed
securities. The actual rate of voluntary prepayments and the amount and timing
of credit losses affect the Company's yield on retained REMIC residual interests
and the fair value of such interests in periods subsequent
8
<PAGE>
to the securitization. For the quarter ended December 31, 1997, total credit
losses on loans originated by the Company, including losses relating to
securitized assets, loans held for investment, loans held for sale and loans
sold with full or partial recourse, amounted to approximately 1.22% on an
annualized basis of the average principal balance of the related loans, compared
to approximately 1.13% one year ago. The increase in net credit losses is due in
part to the industry-wide trend toward lower down payments which began in 1994.
The higher loss ratio also reflects increased frequency of repossession in
addition to loss severity. Increasing loss ratios have the effect of reducing
the yields on the Company's retained interests in securitized assets.
Continuation of these trends could adversely affect future yields on or the
carrying value of certain retained REMIC residual interests. To counteract this
trend, the Company tightened underwriting standards and focused additional
emphasis on closing retail sales with relatively higher credit quality
customers. In addition, the Company has implemented programs to improve recovery
rates on defaulted loans in order to reduce the severity of credit losses.
Financial services income for the first quarter of fiscal 1998 and 1997
includes gains of approximately $6.0 million, or $.08 per share, after tax and
$5.0 million, or $.06 per share, after tax, respectively, from the sale of
asset-backed securities.
Financial services income for the first quarter of fiscal 1998 also
includes $6.9 million in revenues from the Company's new captive reinsurance
business which began operations on June 1, 1997. This new subsidiary enables the
Company to participate more fully in what management believes to be the
profitable income streams associated with the property and casualty insurance
and service contract business than was possible under the commission-based
insurance agency arrangement which preceded its formation. As an insurance
underwriter, the Company recognizes insurance premium revenues over the life of
the related policies as a component of financial services income, with the
associated claims expenses reflected in financial services operating expenses.
Previously, insurance commission revenue was reported upon the sale of the
policies by Oakwood's retail operations, and was included in other income. Due
to this fundamental change in the Company's business, earnings for insurance
operations are now spread over the lives of the policies rather than being
recognized in full when the policies were sold. Management estimates that this
conversion from an insurance agency to an insurance underwriter penalized first
quarter 1998 earnings by approximately $1.8 million (approximately $1.1 million
after tax, or approximately $.02 per share). This anomaly in comparisons is
expected to continue, with decreasing effect, through mid-1999. Because
reinsurance claims costs are recorded as insured events occur, underwriting
reinsurance risk may increase the volatility of the Company's earnings,
particularly with respect to property and casualty reinsurance. The Company has
purchased catastrophe reinsurance to reduce its underwriting exposure to natural
disasters.
The majority of the 51% decrease in other income reflects decreased
insurance commissions resulting from the formation of the reinsurance subsidiary
and the Company's exit from commission-based insurance agency arrangements
discussed above. Insurance commissions for the first quarter of fiscal 1997
totaled $2.5 million.
9
<PAGE>
Selling, general and administrative expenses declined to 26.3% of net
sales in the first quarter of fiscal 1998 compared to 27.2% of net sales last
year. The decrease reflects in part the reduced significance of fixed costs on a
higher revenue base.
Financial services operating expenses rose 91% during the first quarter
of fiscal 1998 due to the addition of claims and other expenses related to the
formation of the captive reinsurance company discussed above. Exclusive of the
captive reinsurance costs, financial services operating expenses rose $158,000
or 3% compared to the quarter ended December 31, 1996 on a 30% increase in the
average number of loans serviced during the period and a 35% increase in total
credit application volume.
Financial services interest expense includes interest expense
associated with long-term debt secured by loans as well as interest expense
associated with all short-term line of credit borrowings. Financial services
interest expense increased 12% primarily due to a $1.6 million increase in
short-term interest expense related to higher average outstanding balances,
offset by lower weighted average interest rates on short-term lines of credit.
This increase was partially offset by declining and retired long-term debt
balances. Financial services interest expense associated with notes and bonds
payable is expected to continue to decline as the Company retires its
outstanding debt secured by loans.
YEAR 2000 ISSUES
----------------
The Company has analyzed the potential effects of year 2000 issues on
the computer systems that support the Company's business, including issues
associated with the Company's internally developed software and software
licensed from third parties. The Company is also in the process of reviewing the
issues faced by certain significant suppliers to the Company.
The Company has begun remediation of internally developed software to
resolve year 2000 compliance issues. The costs incurred by the Company to date,
which have been charged to expense, have not been material, and the Company does
not anticipate that the expected remaining costs will be material. Based upon
its assessment of internally developed and licensed software and the status of
remediation undertaken to date, the Company believes that substantially all
significant issues associated with year 2000 compliance will be resolved by the
end of calendar 1998.
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
Receivables and investments decreased from September 30, 1997 primarily
due to the timing and amount of the Company's securitization of loans held for
sale, as well as the continued amortization of loans held for investment. The
Company originates loans and warehouses them until sufficient receivables have
been accumulated for a securitization. Through its Oakwood Mortgage Investors
subsidiary, the Company securitized approximately $252 million of loans in
November 1997.
The increase in inventories from September 30, 1997 reflects the normal
seasonal manufacture of inventory during the winter months in preparation for
the spring and summer selling season.
10
<PAGE>
Short-term borrowings reflect outstanding advances on the Company's
warehousing facility used to finance originated loans prior to securitization or
other permanent financing as well as borrowings under other short-term credit
facilities. Management believes that permanent financing for its loans remains
readily available and anticipates securitizing installment sale contracts using
REMICs approximately every three months.
The Company intends to finance internal growth of its retail and
manufacturing business principally using internally generated funds and
short-term lines of credit. Because the Company sells all of the regular REMIC
interests in its securitizations, additional permanent corporate financing is
not expected to be required to fund internal expansion of the financial services
businesses. However, as discussed below, in the event the potential Schult Homes
Acquisition is consummated, the Company anticipates it will finance the
acquisition with certain long-term debt. Additionally, should the Company expand
its businesses through other significant acquisitions, additional permanent
capital could be required. In addition, the Company continues to monitor the
debt and equity markets and evaluate the sources and cost of long-term capital
in light of management's assessment of existing and future conditions in the
capital markets and its assessment of the appropriate components of the
Company's capital structure. While management believes that existing financing
is sufficient to provide for the Company's internal growth for the foreseeable
future, the Company may seek to raise additional long-term debt or equity if
compelling market conditions arise. During 1997 Standard & Poor's Ratings Group,
Moody's Investors Service and Fitch Investors Service, L.P. each raised its
rating of the Company's senior long-term debt to BBB-. Management believes that
achieving an investment grade rating from major credit rating agencies enhances
the Company's flexibility in obtaining both short and long-term financing.
POTENTIAL BUSINESS ACQUISITION
------------------------------
On January 5, 1998 the Company signed a definitive agreement to acquire
Schult Homes Corporation. The agreement provides that Schult will be merged with
a newly formed subsidiary of the Company; pursuant to the merger, each
outstanding common share of Schult will be converted into the right to receive
$22.50 in cash, or approximately $101 million in the aggregate. Consummation of
the acquisition is anticipated by March 31, 1998 and is subject to certain
conditions, including completion of environmental due diligence and certain
documentation, receipt of certain approvals and approval of the merger by the
shareholders of Schult. The Company intends to account for the acquisition as a
purchase.
Schult is an independent producer of manufactured and modular housing
headquartered in Middlebury, Indiana. Schult focuses on the middle to higher
price range of the manufactured housing market and the lower to middle price
range of the modular housing market. For the year ended June 28, 1997,
approximately 86% of Schult's $348 million of net sales represented sales of
manufactured homes, with the balance representing sales of modular homes. Schult
markets manufactured homes under the "Schult" and "Marlette" brand names, and
modular homes under the "Crest" brand name. Schult's products are manufactured
in ten plants located in seven states, and are sold to over 900 independent
dealers.
11
<PAGE>
The Company has a commitment from a commercial bank to lend the Company
$100 million to fund, in part, the acquisition of Schult. The commitment
provides that the $100 million is repayable 364 days from the date on which the
loan is funded. The Company intends to refinance the acquisition financing using
long-term debt. The amount of such long-term debt may exceed the amount of the
acquisition financing; such excess, if any, will be used for general corporate
purposes, which may include, among other things, retirement of other long-term
debt.
12
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
At the Annual Meeting of Shareholders of the Registrant held on
February 11, 1998, the shareholders approved (i) the election of Clarence W.
Walker, Dennis I. Meyer, C. Michael Kilbourne, and Lanty L. Smith, as directors;
(ii) the 1997 Director Stock Option Plan; and (iii) the selection of Price
Waterhouse LLP as independent accountants. The following table sets forth the
votes on each such matter:
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN NOT VOTED
--- -------- --------- ---------
<S> <C> <C> <C> <C>
Election of Directors
(by nominee)
Clarence W. Walker 40,208,704 -- 833,671 5,372,883
Dennis I. Meyer 40,718,116 -- 324,259 5,372,883
C. Michael Kilbourne 40,717,698 -- 324,677 5,372,883
Lanty L. Smith 40,716,573 -- 325,802 5,372,883
APPROVAL OF THE 1997
Director Stock Option Plan
37,790,500 2,967,424 284,451 5,372,883
Approval of Selection of
Price Waterhouse LLP as Independent
Auditors 40,866,729 34,007 141,639 5,372,883
</TABLE>
13
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
(4) Agreement to Furnish Copies of Instruments
with Respect to Long-term Debt
(11) Statement re Computation of Earnings Per Share
(27) Financial Data Schedule (filed in electronic
format only)
b) Reports on Form 8-K
No reports on Form 8-K were filed for the quarter
ended December 31, 1997.
Items 1, 2, 3 and 5 are inapplicable and are omitted.
14
<PAGE>
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: February 13, 1998
OAKWOOD HOMES CORPORATION
BY: s/ C. Michael Kilbourne
------------------------
C. Michael Kilbourne
Executive Vice President
(Chief Financial Officer)
(Duly Authorized Officer)
15
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
ITEM 6(a)
FORM 10-Q
QUARTERLY REPORT
For the quarter ended Commission File Number
December 31, 1997 1-7444
OAKWOOD HOMES CORPORATION
EXHIBIT INDEX
Exhibit No. Exhibit Description
---------- --------------------
4 Agreement to Furnish Copies of Instruments with
respect to Long-Term Debt
11 Statement re Computation of Earnings Per Share
27 Financial Data Schedule (filed in electronic format
only)
16
EXHIBIT 4
AGREEMENT TO FURNISH COPIES OF INSTRUMENTS
WITH RESPECT TO LONG-TERM DEBT
------------------------------
The Registrant has entered into certain agreements with respect to
long-term indebtedness which do not exceed ten percent of the total assets of
the Registrant and its subsidiaries on a consolidated basis. The Registrant
hereby agrees to furnish a copy of such agreements to the Commission upon
request of the Commission.
OAKWOOD HOMES CORPORATION
By: s/ C. Michael Kilbourne
---------------------------
C. Michael Kilbourne
Executive Vice President
17
EXHIBIT 11
OAKWOOD HOMES CORPORATION AND SUBSIDIARIES
STATEMENT RE COMPUTATION OF EARNINGS PER SHARE
(in thousands, except per share data)
<TABLE>
<CAPTION>
Three months ended
December 31,
-------------------
1997 1996
----- ----
<S> <C> <C>
Weighted average number of common
shares outstanding 46,147 45,550
Less: Unearned ESOP shares (97) (137)
------- --------
Weighted average number of common
shares outstanding 46,050 45,413
======= ==-====
Net income $17,802 $15,193
======= =======
Earnings per common share - basic $ .39 $ .33
======= =======
Weighted average number of common
shares outstanding 46,147 45,550
Add: Dilutive effect of stock options
and restricted shares, computed
using the treasury stock method 1,281 1,319
Less: Unearned ESOP shares (97) (137)
------- ------
Weighted average number of common
and common equivalent shares
outstanding 47,331 46,732
======= ======
Net income $17,802 $13,877
======= =======
Earnings per common share - diluted $ .38 $ .33
======== =======
</TABLE>
18
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the year ended Sept.
30, 1997 filed as part of the Registrant's Form 10-K for the year ended
Sept. 30, 1997 and is qualified in its entirety by reference to such Form
10-K.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 28,717
<SECURITIES> 0
<RECEIVABLES> 465,156
<ALLOWANCES> 3,076
<INVENTORY> 208,298
<CURRENT-ASSETS> 0
<PP&E> 186,078
<DEPRECIATION> 46,376
<TOTAL-ASSETS> 904,506
<CURRENT-LIABILITIES> 296,761
<BONDS> 78,815
0
0
<COMMON> 23,149
<OTHER-SE> 460,733
<TOTAL-LIABILITY-AND-EQUITY> 904,506
<SALES> 952,704
<TOTAL-REVENUES> 1,070,051
<CGS> 651,400
<TOTAL-COSTS> 917,042
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 19,817
<INCOME-PRETAX> 133,192
<INCOME-TAX> 51,279
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 81,913
<EPS-PRIMARY> 1.79<F1>
<EPS-DILUTED> 1.75
<FN>
<F1>EPS-BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the quarter ended March
31, 1997 filed as part of the Registrant's Form 10-Q for the quarter ended
March 31, 1997 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 22,516
<SECURITIES> 0
<RECEIVABLES> 364,082
<ALLOWANCES> 5,233
<INVENTORY> 225,634
<CURRENT-ASSETS> 0
<PP&E> 164,087
<DEPRECIATION> 41,563
<TOTAL-ASSETS> 815,477
<CURRENT-LIABILITIES> 258,455
<BONDS> 115,184
0
0
<COMMON> 23,016
<OTHER-SE> 404,586
<TOTAL-LIABILITY-AND-EQUITY> 815,477
<SALES> 368,434
<TOTAL-REVENUES> 427,479
<CGS> 252,850
<TOTAL-COSTS> 364,230
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,640
<INCOME-PRETAX> 53,609
<INCOME-TAX> 20,702
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 32,907
<EPS-PRIMARY> .72<F1>
<EPS-DILUTED> .71
<FN>
<F1> EPS BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the quarter ended March
31, 1996 filed as part of the Registrant's Form 10-Q for the quarter ended
March 31, 1996 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 18,158
<SECURITIES> 0
<RECEIVABLES> 368,162
<ALLOWANCES> 6,081
<INVENTORY> 164,588
<CURRENT-ASSETS> 0
<PP&E> 151,172
<DEPRECIATION> 34,707
<TOTAL-ASSETS> 705,302
<CURRENT-LIABILITIES> 184,211
<BONDS> 160,719
0
0
<COMMON> 11,216
<OTHER-SE> 339,011
<TOTAL-LIABILITY-AND-EQUITY> 705,302
<SALES> 367,492
<TOTAL-REVENUES> 425,639
<CGS> 267,067
<TOTAL-COSTS> 363,978
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 12,466
<INCOME-PRETAX> 49,195
<INCOME-TAX> 19,166
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,029
<EPS-PRIMARY> .68<F1>
<EPS-DILUTED> .65
<FN>
<F1> EPS BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the quarter ended December
31, 1995 filed as part of the Registrant's Form 10-Q for the quarter ended
December 31, 1995 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> DEC-31-1995
<EXCHANGE-RATE> 1
<CASH> 11,999
<SECURITIES> 0
<RECEIVABLES> 419,941
<ALLOWANCES> 7,506
<INVENTORY> 155,735
<CURRENT-ASSETS> 0
<PP&E> 141,854
<DEPRECIATION> 32,490
<TOTAL-ASSETS> 732,928
<CURRENT-LIABILITIES> 202,216
<BONDS> 187,296
0
0
<COMMON> 11,148
<OTHER-SE> 321,998
<TOTAL-LIABILITY-AND-EQUITY> 732,928
<SALES> 176,269
<TOTAL-REVENUES> 204,436
<CGS> 130,223
<TOTAL-COSTS> 175,548
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,138
<INCOME-PRETAX> 22,750
<INCOME-TAX> 8,873
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,877
<EPS-PRIMARY> .31<F1>
<EPS-DILUTED> .30
<FN>
<F1> EPS BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the year ended September
30, 1995 filed as part of the Registrant's Form 10-K for the year ended
Septemeber 30, 1995 and is qualified in its entirety by reference to such Form
10-K.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 6,189
<SECURITIES> 0
<RECEIVABLES> 489,486
<ALLOWANCES> 8,611
<INVENTORY> 151,190
<CURRENT-ASSETS> 0
<PP&E> 133,136
<DEPRECIATION> 31,378
<TOTAL-ASSETS> 782,640
<CURRENT-LIABILITIES> 241,805
<BONDS> 198,812
0
0
<COMMON> 11,086
<OTHER-SE> 307,322
<TOTAL-LIABILITY-AND-EQUITY> 782,640
<SALES> 741,521
<TOTAL-REVENUES> 621,412
<CGS> 543,320
<TOTAL-COSTS> 721,409
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 2,109
<INTEREST-EXPENSE> 24,897
<INCOME-PRETAX> 72,997
<INCOME-TAX> 26,374
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 46,623
<EPS-PRIMARY> 1.03<F1>
<EPS-DILUTED> .99
<FN>
<F1> EPS BASIC
<F2> In June 1995, Oakwood acquired Destiny Industries, Inc. a subchapter S
Corporation whose earnings were includable in the tax returns of its
shareholders. Consequently, Destiny's financial statements did not reflect
a provision for income taxes prior to its acquisition by the Company. Income
taxes and net income above are on a historical basis, however, EPS is only
presented on a proforma basis (assuming Destiny's results had been
includable in the Company's tax returns) as historical EPS is not meaningful.
Proforma taxes and net income were $27,679 and $45,318, respectively.
<F3>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the quarter ended June
30, 1997 filed as part of the Registrant's Form 10-Q for the quarter ended
June 30, 1997 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<CURRENCY> US DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<CASH> 23,034
<SECURITIES> 0
<RECEIVABLES> 407,434
<ALLOWANCES> 4,183
<INVENTORY> 230,276
<CURRENT-ASSETS> 0
<PP&E> 170,344
<DEPRECIATION> 43,528
<TOTAL-ASSETS> 838,642
<CURRENT-LIABILITIES> 275,493
<BONDS> 85,212
0
0
<COMMON> 23,025
<OTHER-SE> 427,368
<TOTAL-LIABILITY-AND-EQUITY> 838,642
<SALES> 634,449
<TOTAL-REVENUES> 719,916
<CGS> 434,366
<TOTAL-COSTS> 614,557
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 15,125
<INCOME-PRETAX> 90,234
<INCOME-TAX> 34,830
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 55,404
<EPS-PRIMARY> 1.21<F1>
<EPS-DILUTED> 1.19
<FN>
<F1> EPS BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the year ended Sept.
30, 1996 filed as part of the Registrant's Form 10-K for the year ended
Sept. 30, 1996 and is qualified in its entirety by reference to such Form
10-K.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> SEP-30-1996
<CASH> 28,577
<SECURITIES> 0
<RECEIVABLES> 515,156
<ALLOWANCES> 6,331
<INVENTORY> 155,890
<CURRENT-ASSETS> 0
<PP&E> 150,052
<DEPRECIATION> 36,288
<TOTAL-ASSETS> 841,977
<CURRENT-LIABILITIES> 301,605
<BONDS> 134,379
0
0
<COMMON> 22,811
<OTHER-SE> 369,163
<TOTAL-LIABILITY-AND-EQUITY> 841,977
<SALES> 862,079
<TOTAL-REVENUES> 973,922
<CGS> 609,303
<TOTAL-COSTS> 839,872
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 1,000
<INTEREST-EXPENSE> 22,370
<INCOME-PRETAX> 110,680
<INCOME-TAX> 42,425
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 68,255
<EPS-PRIMARY> 1.53<F1>
<EPS-DILUTED> 1.47
<FN>
<F1>EPS-BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's consolidated financial statements for the quarter ended December
31, 1997 filed as part of the Registrant's Form 10-Q for the quarter ended
December 31, 1997 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 39,411
<SECURITIES> 0
<RECEIVABLES> 380,139
<ALLOWANCES> 2,248
<INVENTORY> 242,216
<CURRENT-ASSETS> 0
<PP&E> 193,721
<DEPRECIATION> 50,090
<TOTAL-ASSETS> 890,343
<CURRENT-LIABILITIES> 264,971
<BONDS> 72,989
0
0
<COMMON> 23,220
<OTHER-SE> 479,787
<TOTAL-LIABILITY-AND-EQUITY> 890,343
<SALES> 221,893
<TOTAL-REVENUES> 254,663
<CGS> 151,826
<TOTAL-COSTS> 221,324
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,626
<INCOME-PRETAX> 28,713
<INCOME-TAX> 10,911
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,802
<EPS-PRIMARY> .39<F1>
<EPS-DILUTED> .38
<FN>
<F1>EPS-BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's Consolidated Financial Statements for the quarter ended June
30, 1996 filed as part of the Registrant's Form 10-Q for the quarter ended
June 30, 1996 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> OCT-01-1995
<PERIOD-END> JUN-30-1996
<CASH> 32,912
<SECURITIES> 0
<RECEIVABLES> 473,714
<ALLOWANCES> 5,054
<INVENTORY> 167,544
<CURRENT-ASSETS> 0
<PP&E> 161,559
<DEPRECIATION> 36,666
<TOTAL-ASSETS> 836,297
<CURRENT-LIABILITIES> 316,649
<BONDS> 140,259
0
0
<COMMON> 22,588
<OTHER-SE> 346,441
<TOTAL-LIABILITY-AND-EQUITY> 836,297
<SALES> 606,797
<TOTAL-REVENUES> 689,106
<CGS> 432,820
<TOTAL-COSTS> 593,236
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 17,349
<INCOME-PRETAX> 78,521
<INCOME-TAX> 30,623
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 47,898
<EPS-PRIMARY> 1.07<F1>
<EPS-DILUTED> 1.03
<FN>
<F1>EPS-BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Registrant's Consolidated Financial Statements for the quarter ended June
30, 1996 filed as part of the Registrant's Form 10-Q for the quarter ended
June 30, 1996 and is qualified in its entirety by reference to such Form
10-Q.
</LEGEND>
<RESTATED> Yes
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 19,976
<SECURITIES> 0
<RECEIVABLES> 369,682
<ALLOWANCES> 5,747
<INVENTORY> 189,716
<CURRENT-ASSETS> 0
<PP&E> 156,079
<DEPRECIATION> 39,094
<TOTAL-ASSETS> 751,653
<CURRENT-LIABILITIES> 205,844
<BONDS> 122,782
0
0
<COMMON> 22,989
<OTHER-SE> 386,527
<TOTAL-LIABILITY-AND-EQUITY> 751,653
<SALES> 177,782
<TOTAL-REVENUES> 207,190
<CGS> 123,812
<TOTAL-COSTS> 177,963
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,321
<INCOME-PRETAX> 24,906
<INCOME-TAX> 9,713
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15,193
<EPS-PRIMARY> .33<F1>
<EPS-DILUTED> .33
<FN>
<F1>EPS-BASIC
<F2>The Registrant adopted Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" on October 1, 1997. This schedule has been restated to
reflect such adoption.
</FN>
</TABLE>
