COBURG, OR – June 14, 2007
– Monaco Coach Corporation (NYSE: MNC)
announced today that it will consolidate the Indiana-based
production of Holiday Rambler and McKenzie fifth-wheel and travel
trailer recreational vehicles from Elkhart, Indiana to its Wakarusa
and Warsaw, Indiana facilities by the end of October.
The transfer
of towable production from Elkhart will result in the creation of a
significant number of production positions in both Wakarusa and
Warsaw. All current Elkhart towable employees will be eligible for
transferred job opportunities with corresponding production lines in
Warsaw or Wakarusa. The Company is currently reviewing several
alternatives for the approximately 260,000 square foot facility that
it will vacate in Elkhart.
“We regret the
impact this plant consolidation may have on our many long-term
Elkhart employees, and we’re hopeful they will decide to move with
our production lines,” said John Nepute, President of Monaco Coach
Corporation. “Our Company will continue to have a large presence in
Elkhart County with approximately 2,200 employees.”
Nepute noted,
“The Company will continue to operate our joint venture with
International Truck and Engine Corporation, Custom Chassis Products,
LLC service facilities and call centers in the city of Elkhart. We
plan to grow the joint venture, which should result in additional
jobs.”
“Before making
the decision we reviewed several scenarios with regard to continuing
to manufacture towables in Elkhart,” continued Nepute. “Our
analysis showed us that by making this move we will better utilize
the capacity of the remaining plant facilities and resources,
leading to better efficiencies such as improving absorption of
indirect expenses and synergies in material and labor costs. We
believe this consolidation is compelling in the short term and also
makes strategic long-term sense for our Company.”
“The
anticipated savings on a go-forward basis are considerable,” said
Marty Daley, Chief Financial Officer. “We expect the changes will
add approximately $0.10 to $0.12 per share to our earnings next
fiscal year, and anticipate recording one-time pre-tax charges in
the third and fourth quarters of 2007, totaling approximately $1.0
million to $1.2 million for move-related expenses.”
About Monaco Coach Corporation
Dedicated to
quality and service, Monaco Coach Corporation is one of the nation’s
leading manufacturers of motorized and towable recreational
vehicles. Headquartered in Coburg, Oregon, with substantial
manufacturing facilities in Indiana, Monaco Coach employs
approximately 5,300 people. The Company offers entry-level priced
towable RVs up to custom made luxury recreational vehicle models
under the Monaco, Holiday Rambler, Safari, Beaver, McKenzie,
R-Vision and Dodge brand names. Monaco Coach maintains RV service
centers in Harrisburg, Ore., Elkhart, Ind., and Wildwood, Fla.
Ranked as the
number one manufacturer of diesel-powered motorhomes, Monaco Coach
is a leader in innovative RVs designed to meet the needs of a broad
range of customers with varied interests. Monaco Coach Corporation
trades on the New York Stock Exchange under the symbol “MNC,” and
the Company is included in the S&P Small-Cap 600 stock index. For
additional information about Monaco Coach Corporation, please visit
www.monaco-online.com or
www.trail-lite.com.
The statements above regarding plant efficiencies, utilization,
potential savings and expenses for 2007 and 2008 fiscal years are
forward-looking statements based on current information and
expectations and involve a number of risks and uncertainties. A
number of factors could cause actual results to differ materially
from these statements, including larger than projected transition
costs, less than anticipated manufacturing gains, slower than
expected sales of new and existing products, a general slowdown in
the economy, new product introductions by competitors, or the loss
of dealers or deterioration in the relationships with dealers.
Please refer to the Company’s SEC reports, including, but not
limited to, the most recent Form 10-Q, the annual report on Form
10-K for 2006, and the 2006 Annual Report to Shareholders for
additional factors. These filings can be accessed over the Internet
at www.sec.gov.
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