Addison, AL, January 10, 2006--Manufactured housing company Cavalier Homes announced that it expects to report total revenue of approximately $97-$100 million for the fourth quarter of 2005 that ended December 31, which will bring full-year revenue to approximately $271-$274 million.
These figures compare with $76.0 million in the fourth quarter of 2004 and $234.2 million for fiscal year 2004.
Cavalier continues to anticipate profitable operations for the fourth quarter and full year, with net income for the quarter and year comparing favorably to net income of $4.7 million ($0.25 per diluted share) in the fourth quarter of 2004 and $3.2 million ($0.18 per diluted share) for fiscal year 2004. With the expectation that 2005 will be the company's second consecutive year of profitability, Cavalier also maintains its outlook for profitable operations in 2006. Presently, the company anticipates that it will issue fourth-quarter results in early March.
Higher revenues for this past year were driven by an increase in floor shipments of approximately 500 over 2004, higher sales prices stemming from increased material costs, and a change in product mix.
During 2005, the company shipped 1,196 more Federal Emergency Management Agency (FEMA) homes than in 2004, each of which carries a sales price above Cavalier's standard product.
Floor shipments for all of 2005 are expected to reach approximately 11,300, representing an increase of 5% over the 10,772 floors shipped in 2004. FEMA shipments for 2005 are expected to total 2,219 compared with 1,023 in 2004.
The higher revenue for the fourth quarter of 2005 compared with the prior-year period resulted from a modest increase in floor shipments and a significant product shift to FEMA homes. Floor shipments for the fourth quarter of 2005 are expected to be 3,450, up 3% from 3,353 in the comparable 2004 period. Included in these figures are shipments of FEMA homes, which are expected to total 2,008 in the fourth quarter of 2005 versus 714 in the year-earlier period.
During 2005, the company announced a series of contracts and contract modifications to produce FEMA homes. Together, these agreements ultimately called for the construction and delivery of 2,638 single-section homes by mid-December 2005.
During the fourth quarter, due to FEMA's logistical issues, Cavalier delayed production or delivery on a portion of these shipments. As of December 31, 2005, the company had produced, but not shipped, a total of 244 FEMA homes under its contracts.
Cavalier expects to build the remaining 175 FEMA homes and complete all FEMA shipments during the first quarter of 2006, which is expected to result in revenue from FEMA units of approximately $13 million in that quarter.
Cavalier's accounts receivable related to FEMA shipments are expected to total $35 million at December 31, 2005, versus $2.6 million at December 31, 2004. The company's past experience indicates that the collection period for FEMA accounts receivable is longer than the average period for other trade accounts receivable.
Cavalier's management will participate in a series of meetings with institutional investors on January 10 and 11 to review this outlook and the company's view on market conditions in the coming year. The presentation to be used in those investor meetings will be available on the investor relations section of the company's website for a period of 60 days beginning on January 10, 2006.
