Champion Homes (SKY) investor relations material

Executive summary

• Net sales for Q1 fiscal 2027 rose 1.3% year-over-year to $710.2 million, driven by higher U.S. manufacturing and retail sales, partially offset by a decline in Canadian segment sales.

• U.S. homes sold increased 1.8% to 7,089 units, with average selling price up 0.6% to $95,600.

• Net income attributable to the company declined 24% year-over-year to $49.2 million, with adjusted net income at $48.3 million and adjusted EPS at $0.88.

• Gross profit margin was 25.2%, down from 27.1% due to higher material input costs.

• Completed the acquisition of Homes Direct, expanding the retail network by 11 stores; financial impact will be limited in Q2 due to timing.

Financial highlights

• Adjusted gross profit was $179 million (25.2% margin); adjusted EBITDA was $73.6 million (10.4% margin).

• Adjusted SG&A was 16.4% of net sales; SG&A expenses increased to $119 million.

• Cash and cash equivalents ended at $784.7 million, up from $638.3 million at year-end, mainly due to ECN transaction proceeds.

• Operating cash flow was $72.5 million; investing activities provided $126 million, mainly from the ECN sale.

• Operating income decreased 23.2% to $60.3 million.

Outlook and guidance

• Q2 revenue expected to grow mid-single digits year-over-year, excluding Homes Direct.

• Near-term adjusted gross margin expected in the 25%-26% range; adjusted SG&A as a percent of sales to remain at 16%-17%.

• Fiscal 2027 effective tax rate expected to rise to ~25% due to expiration of ENERGY STAR tax credits.

• Management expects cash flows and liquidity to be sufficient for ongoing operations, capital expenditures, and strategic initiatives.

• Homes Direct will be additive to results over time as integration ramps.