Champion Homes, Inc.

First-quarter net sales increased 1.3% year over year to $710.2 million. U.S. homes sold increased 1.8% to 7,089 units, while Canada homes sold declined to 185 from 250. Adjusted gross profit was $179 million, with adjusted gross margin of 25.2%; adjusted SG&A was 16.4% of net sales; adjusted net income attributable to Champion Homes was $48.3 million, or $0.88 per diluted share; and adjusted EBITDA was $73.6 million, or a 10.4% margin. Backlog ended at $421.8 million versus $302 million a year ago, and manufacturing utilization was 62%. For Q2 fiscal 2027, management expects revenue to grow mid-single digits year over year, adjusted gross margin of 25% to 26%, and adjusted SG&A of 16% to 17% of sales. The company also expects the fiscal 2027 effective tax rate to be approximately 25%.

Tim Larson said the quarter was a solid start to fiscal 2027 and emphasized that Champion is outperforming the broader industry through a customer-centric strategy and disciplined execution. He highlighted the closing of Homes Direct as an important step in advancing the direct-to-consumer strategy, but said the financial impact in Q2 will be limited because of timing. He also pointed to regulatory progress, including the ROAD to Housing Act and Virginia zoning reform, as supportive of the long-term outlook for manufactured housing, while stressing that implementation will take time.

Dave McKinstray said the quarter was slightly ahead of expectations, with pricing actions helping offset elevated material costs. He cited adjusted gross profit of $179 million, adjusted gross margin of 25.2%, adjusted SG&A of 16.4%, adjusted net income of $48.3 million, and adjusted EBITDA of $73.6 million. Cash and cash equivalents rose to $784.7 million from $638.3 million at fiscal year-end, largely due to ECN proceeds, and operating cash flow was $72.5 million. He also noted $50 million of share repurchases in the quarter, with $330 million repurchased since the program began in fiscal 2025, and said Q2 margin should improve as pricing actions and other mitigation efforts build through the quarter.

Analysts focused on retail traffic, production pacing, ASP trends, Homes Direct integration, the impact of the ROAD to Housing Act, and SG&A trajectory. Management said retail traffic strengthened through the quarter and early Q2, production is being ramped selectively by market and plant, and ASP pressure was mainly a mix issue from stronger community and independent sales versus captive retail, plus some shift to more base-level models. On Homes Direct, management said the deal is not in Q2 guidance, will ramp over time as products are migrated to Champion, and the business had about $70 million in sales and 11 locations. On regulation, Tim Larson said the HUD rulemaking process will take time and no fiscal 2027 uplift is expected yet; on SG&A, Dave said the company remains in a 16% to 17% of sales range and that Homes Direct will add to costs gradually.