##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
for
the quarterly period ended April 30, 2009.
 o
    
    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 1-9235
 THOR INDUSTRIES, INC.
  Delaware
    
    93-0768752(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 419 West Pike Street, Jackson Center, OH
    
    45334-0629(Address of principal executive offices)
    
    (Zip Code)
 (Registrants telephone number, including area code)
  þ o
  o o
  Large accelerated filer
þ
    
    Accelerated filer
o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ
  Class
    
    Outstanding at 4/30/2009Common stock, par value
$.10 per share
    
    55,440,924 shares




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TABLE OF CONTENTS  PART I    Financial InformationITEM 1. Financial StatementsITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3. Quantitative and Qualitative Disclosures About Market RiskITEM 4. Controls and ProceduresPART II    Other InformationITEM 1. LEGAL PROCEEDINGSITEM 1A. RISK FACTORSITEM 6. EXHIBITSSIGNATURESEX-31.1EX-31.2EX-32.1EX-32.2    Table of Contents  
 PART I   Financial Information
 Unless otherwise indicated, all amounts presented in thousands except units, share and per share data.
 
 ITEM 1.Financial Statements
 THOR INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
 April 30, 2009
    
    
    July 31, 2008ASSETSCurrent assets:Cash and cash equivalents
    
    $
    177,878
    
    
    $
    189,620Accounts receivable:Trade
    
    
    116,429
    
    
    
    136,866Other
    
    
    4,339
    
    
    
    9,489Inventories
    
    
    131,969
    
    
    
    152,582Prepaid expenses
    
    
    3,905
    
    
    
    5,472Note receivable
    
    
    10,000
    
    
    
    Deferred income taxes
    
    
    33,891
    
    
    
    33,891Total current assets
    
    
    478,411
    
    
    
    527,920Property:Land
    
    
    20,299
    
    
    
    21,090Buildings and improvements
    
    
    133,882
    
    
    
    135,167Machinery and equipment
    
    
    73,951
    
    
    
    71,965Total Cost
    
    
    228,132
    
    
    
    228,222Accumulated depreciation
    
    
    82,657
    
    
    
    74,992Property, net
    
    
    145,475
    
    
    
    153,230Investment in joint ventures
    
    
    1,920
    
    
    
    3,269Other assets:Long term investments
    
    
    119,951
    
    
    
    126,403Goodwill
    
    
    148,411
    
    
    
    158,128Non-compete agreements
    
    
    709
    
    
    
    1,093Trademarks
    
    
    13,336
    
    
    
    13,900Long term note receivable
    
    
    10,000
    
    
    
    Other
    
    
    5,354
    
    
    
    12,619Total other assets
    
    
    297,761
    
    
    
    312,143TOTAL ASSETS
    
    $
    923,567
    
    
    $
    996,562LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    82,081
    
    
    $
    96,158Accrued liabilities:Taxes
    
    
    1,415
    
    
    
    26,050Compensation and related items
    
    
    23,582
    
    
    
    24,845Product warranties
    
    
    45,874
    
    
    
    61,743Promotions and rebates
    
    
    9,260
    
    
    
    10,781Product/property liability and related
    
    
    16,043
    
    
    
    12,560Other
    
    
    16,720
    
    
    
    16,279Total current liabilities
    
    
    194,975
    
    
    
    248,416Long Term LiabilitiesUnrecognized tax benefits
    
    
    32,239
    
    
    
    29,332Other
    
    
    14,093
    
    
    
    19,118Total long term liabilities
    
    
    46,332
    
    
    
    48,450Stockholders equity:Common stock  authorized 250,000,000 shares:issued 57,318,263 shares @ 4/30/09 and 57,317,263
shares @ 7/31/08; par value of $.10 per share
    
    
    5,732
    
    
    
    5,732Additional paid-in capital
    
    
    94,159
    
    
    
    93,683Retained earnings
    
    
    656,647
    
    
    
    675,928Accumulated other comprehensive income
    
    
    (594
    )
    
    
    (1,963
    )Less Treasury shares of 1,877,339 @ 4/30/09 & 7/31/08
    
    
    (73,684
    )
    
    
    (73,684
    )Total stockholders equity
    
    
    682,260
    
    
    
    699,696TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    923,567
    
    
    $
    996,562
  2




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THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONDENSED CONSOLIDATED OPERATIONS  FOR THE THREE AND NINE MONTHS ENDED APRIL 30, 2009 AND 2008
 Three Months Ended April 30
    
    
    Nine Months Ended April 302009
    
    
    2008
    
    
    2009
    
    
    2008Net Sales
    
    $
    415,472
    
    
    $
    707,931
    
    
    $
    1,080,972
    
    
    $
    2,070,837Cost of products sold
    
    
    369,025
    
    
    
    617,932
    
    
    
    986,305
    
    
    
    1,809,846Gross profit
    
    
    46,447
    
    
    
    89,999
    
    
    
    94,667
    
    
    
    260,991Selling, general and
administrative expenses
    
    
    33,971
    
    
    
    47,903
    
    
    
    98,636
    
    
    
    133,132Impairment of goodwill and trademarks
    
    
    9,717
    
    
    
    
    
    
    
    10,281
    
    
    
    Gain on sale of property
    
    
    
    
    
    
    
    
    
    
    373
    
    
    
    2,308Interest income
    
    
    1,169
    
    
    
    2,406
    
    
    
    4,670
    
    
    
    9,763Interest expense
    
    
    144
    
    
    
    423
    
    
    
    386
    
    
    
    1,136Net appreciation (impairment) of auction rate securities
    
    
    728
    
    
    
    
    
    
    
    (1,125
    )
    
    
    Other income
    
    
    60
    
    
    
    261
    
    
    
    589
    
    
    
    1,232Income (loss) before income taxes
    
    
    4,572
    
    
    
    44,340
    
    
    
    (10,129
    )
    
    
    140,026Provision (benefit) for income taxes
    
    
    2,470
    
    
    
    16,486
    
    
    
    (2,491
    )
    
    
    52,361Net income (loss)
    
    $
    2,102
    
    
    $
    27,854
    
    
    $
    (7,638
    )
    
    $
    87,665Average common shares outstanding:Basic
    
    
    55,436,924
    
    
    
    55,447,313
    
    
    
    55,426,829
    
    
    
    55,655,907Diluted
    
    
    55,468,620
    
    
    
    55,562,644
    
    
    
    55,426,829
    
    
    
    55,815,770Earnings (loss) per common share:Basic
    
    $
    .04
    
    
    $
    .51
    
    
    $
    (.14
    )
    
    $
    1.58Diluted
    
    $
    .04
    
    
    $
    .50
    
    
    $
    (.14
    )
    
    $
    1.57Regular dividends declared
and paid per common share:
    
    $
    .07
    
    
    $
    .07
    
    
    $
    .21
    
    
    $
    .21Special dividends declared and paid per common share:
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    2.00
  3




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THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS  FOR THE NINE MONTHS ENDED APRIL 30, 2009 AND 2008
 2009
    
    
    2008Cash flows from operating activities:Net income (loss)
    
    $
    (7,638
    )
    
    $
    87,665Adjustments to reconcile net income (loss) to net cash provided by
operating activities:Depreciation
    
    
    9,885
    
    
    
    10,045Amortization
    
    
    384
    
    
    
    613Goodwill and Trademark impairment
    
    
    10,281
    
    
    
    Deferred income taxes
    
    
    
    
    
    
    (18,330
    )Gain on disposition of assets
    
    
    (392
    )
    
    
    (2,343
    )Net impairment on trading investments
    
    
    1,125
    
    
    
    Stock based compensation
    
    
    449
    
    
    
    216Changes in non cash assets and liabilities:Accounts receivable
    
    
    25,587
    
    
    
    (8,941
    )Note receivable
    
    
    (10,000
    )
    
    
    Inventories
    
    
    20,613
    
    
    
    (30,254
    )Prepaids and other
    
    
    8,603
    
    
    
    (3,069
    )Accounts payable
    
    
    (13,652
    )
    
    
    (9,308
    )Accrued liabilities
    
    
    (36,457
    )
    
    
    15,205Other liabilities
    
    
    (6,717
    )
    
    
    8,007Net cash provided by operating activities
    
    
    2,071
    
    
    
    49,506Cash flows from investing activities:Purchases of property, plant & equipment
    
    
    (5,077
    )
    
    
    (12,137
    )Proceeds from disposition of assets
    
    
    2,785
    
    
    
    4,989Purchase of available for sale investments
    
    
    
    
    
    
    (66,650
    )Proceeds from disposition of available for sale investments
    
    
    4,450
    
    
    
    105,925Proceeds from disposition of trading investments
    
    
    5,550
    
    
    
    Loan transaction
    
    
    (10,000
    )
    
    
    Proceeds on dissolution of joint venture
    
    
    1,578
    
    
    
    Net cash (used in) provided by investing activities
    
    
    (714
    )
    
    
    32,127Cash flows from financing activities:Cash dividends
    
    
    (11,643
    )
    
    
    (123,397
    )Purchase of common stock held as treasury shares
    
    
    
    
    
    
    (13,561
    )Proceeds from issuance of common stock
    
    
    27
    
    
    
    2,206Net cash used in financing activities
    
    
    (11,616
    )
    
    
    (134,752
    )Effect of exchange rate changes on cash
    
    
    (1,483
    )
    
    
    910Net increase (decrease) in cash and equivalents
    
    
    (11,742
    )
    
    
    (52,209
    )Cash and equivalents, beginning of period
    
    
    189,620
    
    
    
    171,889Cash and equivalents, end of period
    
    $
    177,878
    
    
    $
    119,680Supplemental cash flow information:Income taxes paid
    
    $
    18,376
    
    
    $
    54,870Interest paid
    
    
    386
    
    
    
    1,136Non cash transactions:Capital expenditures in accounts payable
    
    $
    118
    
    
    $
    391
  4




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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1.
    
    The July 31, 2008 amounts are derived from the annual audited financial statements. The
interim financial statements are unaudited. In the opinion of management, all adjustments
(which consist of normal recurring adjustments) necessary to present fairly the financial
position, results of operations and change in cash flows for the interim periods presented
have been made. These financial statements should be read in conjunction with the Companys
Annual Report on Form 10-K for the year ended July 31, 2008. The results of
operations for the three and nine months ended April 30, 2009 are not necessarily indicative
of the results for the full year.2.
    
    Major classifications of inventories are:
 April 30, 2009
    
    
    July 31, 2008Raw materials
    
    $
    66,409
    
    
    $
    79,356Chassis
    
    
    36,669
    
    
    
    37,562Work in process
    
    
    41,344
    
    
    
    51,162Finished goods
    
    
    15,889
    
    
    
    13,584Total
    
    
    160,311
    
    
    
    181,664Less excess of FIFO costs over LIFO costs
    
    
    28,342
    
    
    
    29,082Total inventories
    
    $
    131,969
    
    
    $
    152,582
  Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Weighted average shares
outstanding for basic earnings
per share
    
    
    55,436,924
    
    
    
    55,447,313
    
    
    
    55,426,829
    
    
    
    55,655,907Stock options and restricted stock
    
    
    31,696
    
    
    
    115,331
    
    
    
    
    
    
    
    159,863Total  For diluted shares
    
    
    55,468,620
    
    
    
    55,562,644
    
    
    
    55,426,829
    
    
    
    55,815,770
 4.
    
    Comprehensive Income
 Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Net Income (loss)
    
    $
    2,102
    
    
    $
    27,854
    
    
    $
    (7,638
    )
    
    $
    87,665Foreign currency
translation
adjustment
    
    
    168
    
    
    
    (100
    )
    
    
    (1,483
    )
    
    
    910Change in temporary
impairment of
investment, net of
tax
    
    
    170
    
    
    
    (4,792
    )
    
    
    2,852
    
    
    
    (4,792
    )Comprehensive income
    
    $
    2,440
    
    
    $
    22,962
    
    
    $
    (6,269
    )
    
    $
    83,783
 As described in Note 6, the Auction Rate Securities (ARS) purchased from UBS were
previously transferred to trading securities and the related other-than-temporary
impairment was recorded against operations. This resulted in a reversal of the charge
previously recorded in other comprehensive income in respect of these securities.
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5.
    
    Segment InformationThe Company has three reportable segments: (1) towable recreation vehicles, (2) motorized
recreation vehicles, and (3) buses. The towable recreation vehicle segment consists of product
lines from the following operating companies that have been aggregated: Airstream,
Breckenridge, CrossRoads, Dutchmen, General Coach, Keystone and Komfort. The motorized
recreation vehicle segment consists of product lines from the following operating companies
that have been aggregated: Airstream, Damon and Four Winds. The bus segment consists of the
following operating companies that have been aggregated: Champion Bus, ElDorado California,
ElDorado Kansas and Goshen Coach.
 Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Net Sales:Recreation vehicles:Towables
    
    $
    264,317
    
    
    $
    480,020
    
    
    $
    664,517
    
    
    $
    1,398,172Motorized
    
    
    47,724
    
    
    
    120,940
    
    
    
    112,499
    
    
    
    372,265Total recreation vehicles
    
    
    312,041
    
    
    
    600,960
    
    
    
    777,016
    
    
    
    1,770,437Buses
    
    
    103,431
    
    
    
    106,971
    
    
    
    303,956
    
    
    
    300,400Total
    
    $
    415,472
    
    
    $
    707,931
    
    
    $
    1,080,972
    
    
    $
    2,070,837
 Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Income (loss) Before Income Taxes:Recreation vehicles:Towables
    
    $
    18,374
    
    
    $
    42,014
    
    
    $
    21,197
    
    
    $
    123,318Motorized
    
    
    (11,514
    )
    
    
    3,390
    
    
    
    (28,405
    )
    
    
    13,804Total recreation vehicles
    
    
    6,860
    
    
    
    45,404
    
    
    
    (7,208
    )
    
    
    137,122Buses
    
    
    1,243
    
    
    
    5,113
    
    
    
    10,263
    
    
    
    12,808Corporate
    
    
    (3,531
    )
    
    
    (6,177
    )
    
    
    (13,184
    )
    
    
    (9,904
    )Total
    
    $
    4,572
    
    
    $
    44,340
    
    
    $
    (10,129
    )
    
    $
    140,026
 April 30, 2009
    
    
    July 31, 2008Identifiable Assets:Recreation vehicles:Towables
    
    $
    372,567
    
    
    $
    409,793Motorized
    
    
    93,485
    
    
    
    108,740Total recreation vehicles
    
    
    466,052
    
    
    
    518,533Buses
    
    
    97,431
    
    
    
    110,647Corporate
    
    
    360,084
    
    
    
    367,382Total
    
    $
    923,567
    
    
    $
    996,562
 6.
    
    Investments and Fair Value Measurements
 Effective August 1, 2008, the Company adopted SFAS No. 157, Fair Value Measurements (SFAS
157). In February 2008, the FASB issued FASB Staff Position No. FAS 157-2, Effective Date of
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FASB Statement No. 157, which provides a one year deferral of the effective date of SFAS 157
for non-financial assets and non-financial liabilities, except those that are recognized or
disclosed in the financial statements at fair value at least annually. Therefore, the Company
has adopted the provisions of SFAS 157 with respect to its financial assets and liabilities
only. The adoption of this statement did not have a material impact on the Companys
consolidated results of operations or financial condition. On October 10, 2008, the FASB
issued FSP No. 157-3, Determining the Fair Value of a Financial Asset When the Market for That
Asset is Not Active, (FSP 157-3), that clarifies the application of SFAS 157 in a market
that is not active and provides an example to illustrate key considerations in determining the
fair value of a financial asset when the market for that financial asset is not active. The
FSP 157-3 is applicable to the valuation of auction rate securities held by the Company for
which there was no active market as of April 30, 2009. FSP 157-3
was effective upon issuance,
including prior periods for which the financial statements have not been issued. The adoption
of FSP 157-3 during the three month period ended October 31, 2008 did not have a material
impact on the Companys consolidated results of operations or financial condition.Effective August 1, 2008, the Company adopted SFAS No. 159 The Fair Value Option for
Financial Assets and Financial Liabilities (SFAS 159). SFAS 159 allows an entity the
irrevocable option to elect fair value for the initial and subsequent measurement for
specified financial assets and liabilities on a contract-by-contract basis. The Company did
not elect to adopt the fair value option under this Statement at the adoption date. On
November 14, 2008, the Company adopted the fair value option related to the Put Rights as
further discussed in this Note.INVESTMENTS AND FAIR VALUE MEASUREMENTSSFAS 157 defines fair value, establishes a framework for measuring fair value under generally
accepted accounting principles and enhances disclosures about fair value measurements. Fair
value is defined under SFAS 157 as the exchange price that would be received for an asset or
paid to transfer a liability (an exit price) in the principal or most advantageous market for
the asset or liability in an orderly transaction between market participants on the
measurement date. Valuation techniques used to measure fair value under SFAS 157 must maximize
the use of observable inputs and minimize the use of unobservable inputs. The standard
describes a fair value hierarchy based on three levels of inputs, of which the first two are
considered observable and the last unobservable, that may be used to measure fair value which
are the following:Level 1  Quoted prices in active markets for identical assets or liabilities.Level 2  Inputs other than Level 1 that are observable, either directly or indirectly, such
as quoted prices for similar assets or liabilities; quoted prices in markets that are not
active; or other inputs that are observable or can be corroborated by observable market data
for substantially the full term of the assets or liabilities.Level 3  Unobservable inputs that are supported by little or no market activity and that are
significant to the fair value of the assets or liabilities.In accordance with SFAS 157, the following table represents the Companys fair value hierarchy
for its financial assets (cash equivalents and investments) measured at fair value on a
recurring basis as of April 30, 2009:
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Significant Quoted
    
    
    Other
    
    
    SignificantMarket Prices in
    
    
    Observable
    
    
    UnobservableActive Markets
    
    
    Inputs
    
    
    Inputs
    
    
    Fair Value at April(Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    30, 2009Cash & cash equivalents
    
    $
    177,878
    
    
    $
    
    
    
    $
    
    
    
    $
    177,878Auction rate securities
(including Put Rights)
    
    
    
    
    
    
    
    
    
    
    119,951
    
    
    
    119,951Total
    
    $
    177,878
    
    
    $
    
    
    
    $
    119,951
    
    
    $
    297,829
 Our cash equivalents are comprised of money market funds traded in an active market with no
restrictions.In addition to the above investments, the Company holds non-qualified retirement plan assets of
$5,317 at April 30, 2009 ($12,519 at July 31, 2008). These assets, which are held for
the benefit of certain employees of the Company, represent Level 1 investments primarily in
mutual funds which are valued using observable market prices in active markets. They are
included in Other Assets on the Consolidated Balance Sheet.Level 3 assets consist of municipal bonds with an auction reset feature (auction rate
securities or ARS) whose underlying assets are primarily student loans which are
substantially backed by the federal government. Auction-rate securities are long-term floating
rate bonds tied to short-term interest rates. After the initial issuance of the securities, the
interest rate on the securities is reset periodically, at intervals established at the time of
issuance based on market demand for a reset period. Auction-rate securities are bought and sold
in the marketplace through a competitive bidding process often referred to as a Dutch
auction. If there is insufficient interest in the securities at the time of an auction, the
auction may not be completed and the rates may be reset to predetermine penalty or maximum
rates based on mathematical formulas in accordance with each securitys prospectus.The following table provides a reconciliation of the beginning and ending balances for the
assets measured at fair value using significant unobservable inputs (Level 3 financial assets):
 Fair Value Measurements atReporting Date UsingSignificant Unobservable Inputs(Level 3)Balances at August 1, 2008
    
    $
    126,403Net change in other comprehensive income
    
    
    4,673Net loss included in earnings
    
    
    (1,125
    )Purchases
    
    
    Sales/Maturities
    
    
    (10,000
    )Balances at April 30, 2009
    
    $
    119,951
 Auction Rate SecuritiesAt April 30, 2009, we held $122,550 (par value) of long-term investments comprised of taxable
and tax-exempt ARS, which are variable-rate debt securities and have a long-term maturity with
the interest being reset through Dutch auctions that are typically held every 7, 28 or 35 days.
The securities have historically traded at par and are callable at par at the option of the
issuer. Interest is typically paid at the end of each auction period or semi-annually. At April
30, 2009, the majority
 8




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of the ARS we held were AAA rated or equivalent, and none were below A
rated or equivalent, with most collateralized by student loans substantially backed by the U.S.
Federal government.Since February 12, 2008, most auctions have failed for these securities and there is no
assurance that future auctions on the ARS in our investment portfolio will succeed and, as a
result, our ability to liquidate our investment and fully recover the par value of our
investment in the near term may be limited or not exist. An auction failure means that the
parties wishing to sell securities could not.In November 2008, the Company elected to participate in a rights offering by UBS AG (UBS), a
Swiss bank which is one of the Companys investment providers, that provides the Company with
the right (the Put Rights) to sell to UBS at par value ARS purchased from UBS (approximately
$107,400 of our entire ARS portfolio of $122,550) at any time during a two-year sale period
beginning June 30, 2010.The Put Rights are not transferable or marginable. By electing to participate in the rights
offering the Company granted UBS the right, exercisable at any time prior to June 30, 2010 or
during the two-year sale period, to purchase or cause the sale of the companys ARS (the Call
Right). UBS has stated that it will only exercise the Call Right for the purpose of
restructurings, dispositions or other solutions that will provide their clients with par value
for their ARS. UBS will pay their clients the par value of their ARS within one day of
settlement of any Call Right transaction. Notwithstanding the Call Right, the Company would be
permitted to sell ARS to parties other than UBS, in which case the Put Rights attached to the
ARS that are sold would be extinguished.As consideration for this transaction, Thor has released UBS from all claims relating to the
marketing or sale of ARS (except claims for consequential damages) and has agreed not to sue
UBS for such claims. During 2008, UBS was sued by the Massachusetts Securities Division and by
the New York Attorney General in
separate civil lawsuits alleging improper sales practices relating to ARS. The rights offering
reflects the terms of a settlement entered into by UBS and various regulators, including the
SEC, the New York Attorney General, and the Massachusetts Securities Division, pursuant to
which UBS agreed to pay a fine of $150 million. UBS has also been sued by investors in civil
lawsuits and arbitrations seeking damages relating to sales of ARS.Through its acceptance of the UBS offer, the Company also became eligible to participate in a
no net cost loan program pursuant to which it may borrow up to the par value of its ARS until
June 30, 2010. The Company is still permitted to obtain ARS based financing from lenders other
than UBS.At April 30, 2009, there was insufficient observable ARS market information available to
determine the fair value of our ARS investments, including the Put Rights. Therefore,
management, assisted by Houlihan, Smith & Company, Inc., an independent consultant, determined
an estimated fair value. In determining the estimate, consideration was given to credit
quality, final stated maturities, estimates on the probability of the issue being called prior
to final maturity, impact due to extended periods of maximum auction rates and broker quotes.
Based on this analysis, we recorded a temporary impairment of $1,474 ($958 net of tax in other
comprehensive income which is in the equity section of the balance sheet) related to our
long-term ARS investments of $15,150 (par value) that were not part of the UBS settlement as of
April 30, 2009. These same assumptions were used to estimate the fair value of our UBS ARS
portfolio described above, including the Put Rights.
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The enforceability of the Put Rights results in a put option which has been recognized as a
separate freestanding instrument that is accounted for separately from the ARS investment. The
Company has elected to account for this put option at fair value under FASB Statement No. 159,
The Fair Value Option for Financial Assets and Liabilities(SFAS 159) and elected to treat
this portion of our ARS portfolio as trading securities. As such, we recorded a benefit to
operations of $9,754 related to the Put Rights provided by the settlement and an
other-than-temporary impairment charge to operations of $10,879 on the $107,400 (par value)
portion of our ARS portfolio for a net loss of $1,125, as we may decide not to hold these ARS
until final maturity with the opportunity provided by the Put Rights.We have no reason to believe that any of the underlying issuers of our ARS are presently at
risk of default. Through April 30, 2009, we have continued to receive interest payments on the
ARS in accordance with their terms. We believe we will be able to liquidate our investments
without significant loss primarily due to the government guarantee of the underlying
securities; however, it could take until the final maturity of the underlying notes (up to 31
years) to realize our investments par value. Due to these recent changes and uncertainty in
the ARS market, we believe the recovery period for these investments may be longer than twelve
months and as a result, we have classified these investments as long-term at April 30, 2009.
Although there is uncertainty with regard to the short-term liquidity of these securities, the
Company continues to believe that the carrying amount represents the fair value of these
marketable securities because of the overall quality of the underlying investments and the
anticipated future market for such investments. In
addition, the Company has the intent and ability to hold these securities until the earlier of:
the market for ARS stabilizes, the issuer refinances the underlying security, a buyer is found
outside of the auction process at acceptable terms, the underlying securities have matured or
the Company exercises its right to put the securities to UBS, one of the Companys investment
providers.7.
    
    Goodwill and Other Intangible AssetsStatement of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible
Assets, requires goodwill to be tested for impairment at least annually and more frequently if
an event occurs which indicates that goodwill may be impaired.The components of other intangible assets are as follows:
 April 30, 2009
    
    July 31, 2008Accumulated
    
    
    
    
    
    AccumulatedCost
    
    Amortization
    
    Cost
    
    AmortizationAmortized Intangible Assets:Non-compete agreements
    
    $
    2,888
    
    
    $
    2,179
    
    
    $
    5,938
    
    
    $
    4,845
 Three Months
    
    Three Months
    
    Nine Months
    
    Nine MonthsEnded
    
    Ended
    
    Ended
    
    EndedApril 30, 2009
    
    April 30, 2008
    
    April 30, 2009
    
    April 30, 2008Non-compete Agreements:Amortization Expense
    
    $
    92
    
    
    $
    200
    
    
    $
    384
    
    
    $
    613
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Non-compete agreements are amortized on a straight-line basis.
 Estimated Amortization Expense:For the year ending July 2009
    
    $
    476For the year ending July 2010
    
    $
    322For the year ending July 2011
    
    $
    238For the year ending July 2012
    
    $
    57
 In accordance with SFAS 142, goodwill and indefinite-lived intangible assets are not subject to
amortization. Goodwill and indefinite-lived intangible assets are reviewed for impairment by
applying a fair-value based test on an annual basis, or more frequently if circumstances
indicate a potential impairment.At April 30, 2009 the Company, with the assistance of an independent valuation firm, completed
an annual impairment review which resulted in a non-cash goodwill impairment charge of $9,717
in the third quarter of fiscal 2009 for the goodwill associated with an operating subsidiary in
the motorized reportable segment. The Company also completed an impairment review in the second
quarter which resulted in a non-cash trademark impairment charge of $564 for the trademark
associated with an operating subsidiary in the motorized reportable segment. The impairments
result from the difficult market environment and outlook for the motorhome business.As of April 30, 2009, Goodwill and Trademarks by segment are as follows:
 Goodwill
    
    
    TrademarksRecreation Vehicles:Towables
    
    $
    143,795
    
    
    $
    10,237Motorized
    
    
    
    
    
    
    2,036Total Recreation Vehicles
    
    
    143,795
    
    
    
    12,273Bus
    
    
    4,616
    
    
    
    1,063Total
    
    $
    148,411
    
    
    $
    13,336
 8.
    
    WarrantyThor provides customers of our products with a warranty covering defects in material or
workmanship for primarily one year with longer warranties of up to five years on certain
structural components. We record a liability based on a consistent calculation reflecting our
best estimate of the amounts necessary to settle future and existing claims on products sold as
of the balance sheet date. Factors we use in estimating the warranty liability include a
history of units sold, existing dealer inventory, average cost incurred and a profile of the
distribution of warranty expenditures over the warranty period. A significant increase in
dealer shop rates, the cost of parts or the frequency of claims could have a material adverse
impact on our operating results for the period or periods in which such claims or additional
costs materialize. Management believes that the warranty reserve is adequate. However, actual
claims incurred could differ from estimates, requiring adjustments to the reserves. Warranty
reserves are reviewed and adjusted as necessary on a quarterly basis.
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Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Beginning Balance
    
    $
    49,798
    
    
    $
    61,690
    
    
    $
    61,743
    
    
    $
    64,310Provision
    
    
    7,252
    
    
    
    17,169
    
    
    
    21,283
    
    
    
    49,244Payments
    
    
    (11,176
    )
    
    
    (16,474
    )
    
    
    (37,152
    )
    
    
    (51,169
    )Ending Balance
    
    $
    45,874
    
    
    $
    62,385
    
    
    $
    45,874
    
    
    $
    62,385
 The lower provision for the three months and nine months ended April 30, 2009 results primarily
from the lower sales activity which the Company is experiencing in the current difficult market
environment.
 9.
    
    Commercial Commitments
 Our principal commercial commitments at April 30, 2009 are summarized in the following chart:
 Total
    
    Term ofCommitment
    
    Amount Committed
    
    CommitmentGuarantee on dealer financing
    
    $   7,087
    
    variousStandby repurchase obligation
on dealer financing
    
    $522,951
    
    up to eighteen months
 The Company records repurchase and guarantee reserves based on prior experience and known
current events. The combined repurchase and recourse reserve balances are approximately
$6,486 and $5,040 as of April 30, 2009 and July 31, 2008, respectively.
 Three Months
    
    
    Three Months
    
    
    Nine Months
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Ended
    
    
    EndedApril 30, 2009
    
    
    April 30, 2008
    
    
    April 30, 2009
    
    
    April 30, 2008Cost of units repurchased
    
    $
    5,852
    
    
    $
    2,239
    
    
    $
    26,559
    
    
    $
    4,993Realization on units resold
    
    
    5,078
    
    
    
    1,614
    
    
    
    21,644
    
    
    
    4,049Losses due to repurchase
    
    $
    (774
    )
    
    $
    (625
    )
    
    $
    (4,915
    )
    
    $
    (944
    )
 The increase in losses due to repurchase resulted from the more difficult market for the
recreation vehicle business. We increased our reserve for repurchases and guarantees at July
31, 2008 and at April 30, 2009.10.
    
    Provision for Income TaxesIt is the Companys policy to recognize interest and penalties accrued relative to unrecognized
tax benefits in income tax expense. For the nine months ended April 30, 2009, no material
change relative to accrued unrecognized tax benefits was recorded and $1,476 in interest and
penalties has been accrued.The Company anticipates a decrease of approximately $1,135 in unrecognized tax benefits within
the next 12 months from (1) expected settlements or payments of uncertain tax positions, and
(2) lapses of the applicable statutes of limitations. Actual results may differ materially from
this estimate.
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11.
    
    Retained EarningsThe components of changes in retained earnings are as follows:
 Balance as of July 31, 2008
    
    $
    675,928Net Loss
    
    
    (7,638
    )Dividends Paid
    
    
    (11,643
    )Balance as of April 30, 2009
    
    $
    656,647
 12.
    
    Line of CreditThe Company had a $30,000 unsecured revolving line of credit which bore interest at prime less
2.15% and expired on November 30, 2008. The Company decided not to renew the unsecured
revolving line of credit and allowed it to expire on November 30, 2008. The decision not to
renew the line of credit was based on our strong cash position combined with our expectation
that we will have the ability to borrow at favorable rates against our ARS, if needed. As a
result, we did not anticipate utilizing the line of credit and did not want to incur the cost
of maintaining it. There was no outstanding balance at July 31, 2008.13.
    
    Loan Transactions and Related Notes ReceivableOn January 15, 2009, the Company entered into a Credit Agreement (the First Credit Agreement)
with Stephen Adams, in his individual capacity, and Stephen Adams and his successors, as
trustee under the Stephen Adams Living Trust (the Trust and together with each of the
foregoing persons, the Borrowers), pursuant to which the Company loaned $10,000 to the
Borrowers (the First Loan). The Borrowers own approximately 90% of FreedomRoads Holding
Company, LLC (FreedomRoads), the parent company of one of the Companys dealers, and pursuant
to the terms of the First Credit Agreement, the Borrowers agreed to use the proceeds of the
First Loan solely to make an equity contribution to FreedomRoads to enable FreedomRoads to
repay its principal obligations under floorplan financing arrangements with third parties in
respect of products of the Company and its subsidiaries.The principal amount of the First Loan is payable in full on January 15, 2014 and bears
interest at a rate of 12% per annum. Interest is payable in kind for the first year and is
payable in cash on a monthly basis thereafter.In connection with the First Loan, the Borrowers caused FreedomRoads and its subsidiaries
(collectively, the FR Dealers), to enter into an agreement pursuant to which the FR Dealers
agreed to purchase additional recreation vehicles from the Company and its subsidiaries. The
term of this agreement continues until the repayment in full of the First Loan under the First
Credit Agreement (including any refinancing or replacement thereof).On January 30, 2009, the Company entered into a Second Credit Agreement (the Second Credit
Agreement and together with the First Credit Agreement, the
Credit Agreements) with the Borrowers pursuant to which the Company loaned an additional
$10,000 to the Borrowers (the Second Loan and together with the First Loan, the Loans).
Pursuant to the terms of the Second Credit Agreement, the Borrowers agreed to use the proceeds
of the Second Loan solely to make an equity contribution to FreedomRoads to be used by
FreedomRoads to purchase the Companys products.
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The principal amount of the Second Loan is payable in full on January 29, 2010 and bears
interest at a rate of 12% per annum. Interest is payable in cash and the first interest payment
was due and paid in full on April 30, 2009. The remaining interest payment dates are: July 31,
2009, October 30, 2009 and January 29, 2010.The Credit Agreements contain customary representations and warranties, affirmative and
negative covenants, events of default and acceleration provisions for loans of this type.The obligations of the Borrowers under the Credit Agreements are guaranteed by FreedomRoads and
are secured by a first priority security interest in all of the direct and indirect legal,
equitable and beneficial interests of the Borrowers in FreedomRoads.In connection with the Second Loan, the FR Dealers and the Company amended their prior
agreement pursuant to which the FR Dealers agreed to purchase additional recreation vehicles
from the Company and its subsidiaries to provide that the term of this agreement now continues
until the repayment in full of the Loans (including any refinancing or replacement thereof).14.
    
    Thor CC, Inc.In March 1994, the Company and a financial services
company formed a joint venture, Thor Credit
Corporation, to finance the sale of recreation vehicles to consumer buyers. This joint venture
was dissolved in September 2008 after the joint venture partner informed us that it was no
longer providing retail financing for recreation vehicles. We recovered our investment of
$1,578 upon dissolution.In November 2008, the Company announced that it will again be providing retail financing for
recreation vehicle customers of Thor dealers through the Companys wholly owned subsidiary,
Thor CC, Inc. (Thor CC). The new business, which is led by employees of the former joint venture, will
finance new Thor and used recreation vehicle products sold by our
dealers.The retail financing to be provided by Thor CC will be funded by Thors operating cash
flow. We anticipate that we will allocate approximately $10,000 which will be used to fund
retail loans. The retail loans will then be sold to banks with which
Thor CC has
established relationships, and the proceeds of such sales will then be available to make new
loans. We do not anticipate any significant impact to our liquidity and capital resources
beyond the $10,000 that we have allocated to Thor CC. The retail loans will be made to
prime and super prime customers with high credit scores. We expect to outsource the servicing
of the loans.As of June 2, 2009, Thor CC offered retail financing
through Thor recreation vehicle dealers  in the following states: Alabama,
Florida, Georgia, Maryland, North Carolina, South Carolina, Tennessee
and Virginia. We expect that Thor CC
will expand its lending ability beyond these states in the future.
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##### Table of Contents



15.
    
    Liquidation of Insurance SubsidiaryThe Company does not intend to insure any future risks through its insurance subsidiary because
of the uncertainty of the timing of the deductibility of the insurance premium. Further, the
Company does not believe that the future benefits of the insurance subsidiary, including the
risk shifting and risk distribution among the Companys operating subsidiaries, are in excess of
the administrative cost of maintenance. The Company is in the process of liquidating the entity.
 15




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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
 Unless otherwise indicated, all amounts presented in thousands of dollars except unit, share and
per share data.
 Executive Overview
        16




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Trends and Business Outlook
     17




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Three Months Ended April 30, 2009 vs.
 Three Months Ended April 30, 2008
 Three Months
    
    
    Three MonthsEnded
    
    
    Ended
    
    
    Change4/30/2009
    
    
    4/30/2008
    
    
    Amount
    
    
    %NET SALES:Recreation VehiclesTowables
    
    $
    264,317
    
    
    $
    480,020
    
    
    $
    (215,703
    )
    
    
    (44.9
    )Motorized
    
    
    47,724
    
    
    
    120,940
    
    
    
    (73,216
    )
    
    
    (60.5
    )Total Recreation Vehicles
    
    
    312,041
    
    
    
    600,960
    
    
    
    (288,919
    )
    
    
    (48.1
    )Buses
    
    
    103,431
    
    
    
    106,971
    
    
    
    (3,540
    )
    
    
    (3.3
    )Total
    
    $
    415,472
    
    
    $
    707,931
    
    
    $
    (292,459
    )
    
    
    (41.3
    )# OF UNITS:Recreation VehiclesTowables
    
    
    12,086
    
    
    
    21,296
    
    
    
    (9,210
    )
    
    
    (43.2
    )Motorized
    
    
    671
    
    
    
    1,570
    
    
    
    (899
    )
    
    
    (57.3
    )Total Recreation Vehicles
    
    
    12,757
    
    
    
    22,866
    
    
    
    (10,109
    )
    
    
    (44.2
    )Buses
    
    
    1,551
    
    
    
    1,597
    
    
    
    (46
    )
    
    
    (2.9
    )Total
    
    
    14,308
    
    
    
    24,463
    
    
    
    (10,155
    )
    
    
    (41.5
    )
 % of
    
    
    
    
    
    
    % ofSegment
    
    
    
    
    
    
    Segment
    
    
    ChangeNet Sales
    
    
    
    
    
    
    Net Sales
    
    
    Amount
    
    
    %GROSS PROFIT:Recreation VehiclesTowables
    
    $
    34,062
    
    
    
    12.9
    
    
    $
    69,731
    
    
    
    14.5
    
    
    $
    (35,669
    )
    
    
    (51.2
    )Motorized
    
    
    1,910
    
    
    
    4.0
    
    
    
    10,671
    
    
    
    8.8
    
    
    
    (8,761
    )
    
    
    (82.1
    )Total Recreation Vehicles
    
    
    35,972
    
    
    
    11.5
    
    
    
    80,402
    
    
    
    13.4
    
    
    
    (44,430
    )
    
    
    (55.3
    )Buses
    
    
    10,475
    
    
    
    10.1
    
    
    
    9,597
    
    
    
    9.0
    
    
    
    878
    
    
    
    9.1Total
    
    $
    46,447
    
    
    
    11.2
    
    
    $
    89,999
    
    
    
    12.7
    
    
    $
    (43,552
    )
    
    
    (48.4
    )SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:Recreation VehiclesTowables
    
    $
    15,809
    
    
    
    6.0
    
    
    $
    27,835
    
    
    
    5.8
    
    
    $
    (12,026
    )
    
    
    (43.2
    )Motorized
    
    
    3,729
    
    
    
    7.8
    
    
    
    7,279
    
    
    
    6.0
    
    
    
    (3,550
    )
    
    
    (48.8
    )Total Recreation Vehicles
    
    
    19,538
    
    
    
    6.3
    
    
    
    35,114
    
    
    
    5.8
    
    
    
    (15,576
    )
    
    
    (44.4
    )Buses
    
    
    9,244
    
    
    
    8.9
    
    
    
    4,293
    
    
    
    4.0
    
    
    
    4,951
    
    
    
    115.3Corporate
    
    
    5,189
    
    
    
    
    
    
    
    8,496
    
    
    
    
    
    
    
    (3,307
    )
    
    
    (38.9
    )Total
    
    $
    33,971
    
    
    
    8.2
    
    
    $
    47,903
    
    
    
    6.8
    
    
    $
    (13,932
    )
    
    
    (29.1
    )INCOME (LOSS) BEFORE INCOME TAXES:Recreation VehiclesTowables
    
    $
    18,374
    
    
    
    7.0
    
    
    $
    42,014
    
    
    
    8.8
    
    
    $
    (23,640
    )
    
    
    (56.3
    )Motorized
    
    
    (11,514
    )
    
    
    (24.1
    )
    
    
    3,390
    
    
    
    2.8
    
    
    
    (14,904
    )
    
    
    (439.6
    )Total Recreation Vehicles
    
    
    6,860
    
    
    
    2.2
    
    
    
    45,404
    
    
    
    7.6
    
    
    
    (38,544
    )
    
    
    (84.9
    )Buses
    
    
    1,243
    
    
    
    1.2
    
    
    
    5,113
    
    
    
    4.8
    
    
    
    (3,870
    )
    
    
    (75.7
    )Corporate
    
    
    (3,531
    )
    
    
    
    
    
    
    (6,177
    )
    
    
    
    
    
    
    2,646
    
    
    
    42.8Total
    
    $
    4,572
    
    
    
    1.1
    
    
    $
    44,340
    
    
    
    6.3
    
    
    $
    (39,768
    )
    
    
    (89.7
    )
 19




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As of
    
    
    As of
    
    
    ChangeApril 30, 2009
    
    
    April 30, 2008
    
    
    Amount
    
    
    %ORDER BACKLOG:Recreation VehiclesTowables
    
    $
    180,075
    
    
    $
    194,938
    
    
    $
    (14,863
    )
    
    
    (7.6
    )Motorized
    
    
    33,287
    
    
    
    81,499
    
    
    
    (48,212
    )
    
    
    (59.2
    )Total Recreation Vehicles
    
    
    213,362
    
    
    
    276,437
    
    
    
    (63,075
    )
    
    
    (22.8
    )Buses
    
    
    228,084
    
    
    
    249,533
    
    
    
    (21,449
    )
    
    
    (8.6
    )Total
    
    $
    441,446
    
    
    $
    525,970
    
    
    $
    (84,524
    )
    
    
    (16.1
    )
 CONSOLIDATED
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Segment Reporting
 RECREATION VEHICLES
  Average PricePer Unit
    
    Units
    
    Net ChangeRecreation VehiclesTowables
    
    
    (1.7
    )%
    
    
    (43.2
    )%
    
    
    (44.9
    )%Motorized
    
    
    (3.2
    )%
    
    
    (57.3
    )%
    
    
    (60.5
    )%
 TOWABLE RECREATION VEHICLES
      21




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MOTORIZED RECREATION VEHICLES
      BUSES
  Average Price Per Unit
    
    Units
    
    Net ChangeBuses
    
    
    (0.4
    )%
    
    
    (2.9
    )%
    
    
    (3.3
    )%
 22




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23




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Nine Months Ended April 30, 2009 vs.
 Nine Months Ended April 30, 2008
 NineMonths
    
    
    Nine MonthsEnded
    
    
    Ended
    
    
    Change4/30/2009
    
    
    4/30/2008
    
    
    Amount
    
    
    %NET SALES:Recreation VehiclesTowables
    
    $
    664,517
    
    
    $
    1,398,172
    
    
    $
    (733,655
    )
    
    
    (52.5
    )Motorized
    
    
    112,499
    
    
    
    372,265
    
    
    
    (259,766
    )
    
    
    (69.8
    )Total Recreation Vehicles
    
    
    777,016
    
    
    
    1,770,437
    
    
    
    (993,421
    )
    
    
    (56.1
    )Buses
    
    
    303,956
    
    
    
    300,400
    
    
    
    3,556
    
    
    
    1.2Total
    
    $
    1,080,972
    
    
    $
    2,070,837
    
    
    $
    (989,865
    )
    
    
    (47.8
    )# OF UNITS:Recreation VehiclesTowables
    
    
    29,732
    
    
    
    62,936
    
    
    
    (33,204
    )
    
    
    (52.8
    )Motorized
    
    
    1,419
    
    
    
    4,681
    
    
    
    (3,262
    )
    
    
    (69.7
    )Total Recreation Vehicles
    
    
    31,151
    
    
    
    67,617
    
    
    
    (36,466
    )
    
    
    (53.9
    )Buses
    
    
    4,648
    
    
    
    4,567
    
    
    
    81
    
    
    
    1.8Total
    
    
    35,799
    
    
    
    72,184
    
    
    
    (36,385
    )
    
    
    (50.4
    )
 % of
    
    
    
    
    
    
    % ofSegment
    
    
    
    
    
    
    Segment
    
    
    ChangeNet Sales
    
    
    
    
    
    
    Net Sales
    
    
    Amount
    
    
    %GROSS PROFIT:Recreation VehiclesTowables
    
    $
    68,799
    
    
    
    10.4
    
    
    $
    200,986
    
    
    
    14.4
    
    
    $
    (132,187
    )
    
    
    (65.8
    )Motorized
    
    
    (2,501
    )
    
    
    (2.2
    )
    
    
    34,344
    
    
    
    9.2
    
    
    
    (36,845
    )
    
    
    (107.3
    )Total Recreation Vehicles
    
    
    66,298
    
    
    
    8.5
    
    
    
    235,330
    
    
    
    13.3
    
    
    
    (169,032
    )
    
    
    (71.8
    )Buses
    
    
    28,369
    
    
    
    9.3
    
    
    
    25,661
    
    
    
    8.5
    
    
    
    2,708
    
    
    
    10.6Total
    
    $
    94,667
    
    
    
    8.8
    
    
    $
    260,991
    
    
    
    12.6
    
    
    $
    (166,324
    )
    
    
    (63.7
    )SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:Recreation VehiclesTowables
    
    $
    48,223
    
    
    
    7.3
    
    
    $
    80,462
    
    
    
    5.8
    
    
    $
    (32,239
    )
    
    
    (40.1
    )Motorized
    
    
    15,641
    
    
    
    13.9
    
    
    
    20,575
    
    
    
    5.5
    
    
    
    (4,934
    )
    
    
    (24.0
    )Total Recreation Vehicles
    
    
    63,864
    
    
    
    8.2
    
    
    
    101,037
    
    
    
    5.7
    
    
    
    (37,173
    )
    
    
    (36.8
    )Buses
    
    
    17,909
    
    
    
    5.9
    
    
    
    11,961
    
    
    
    4.0
    
    
    
    5,948
    
    
    
    49.7Corporate
    
    
    16,863
    
    
    
    
    
    
    
    20,134
    
    
    
    
    
    
    
    (3,271
    )
    
    
    (16.2
    )Total
    
    $
    98,636
    
    
    
    9.1
    
    
    $
    133,132
    
    
    
    6.4
    
    
    $
    (34,496
    )
    
    
    (25.9
    )INCOME (LOSS) BEFORE INCOME TAXES:Recreation VehiclesTowables
    
    $
    21,197
    
    
    
    3.2
    
    
    $
    123,318
    
    
    
    8.8
    
    
    $
    (102,121
    )
    
    
    (82.8
    )Motorized
    
    
    (28,405
    )
    
    
    (25.2
    )
    
    
    13,804
    
    
    
    3.7
    
    
    
    (42,209
    )
    
    
    (305.8
    )Total Recreation Vehicles
    
    
    (7,208
    )
    
    
    (0.9
    )
    
    
    137,122
    
    
    
    7.7
    
    
    
    (144,330
    )
    
    
    (105.3
    )Buses
    
    
    10,263
    
    
    
    3.4
    
    
    
    12,808
    
    
    
    4.3
    
    
    
    (2,545
    )
    
    
    (19.9
    )Corporate
    
    
    (13,184
    )
    
    
    
    
    
    
    (9,904
    )
    
    
    
    
    
    
    (3,280
    )
    
    
    (33.1
    )Total
    
    $
    (10,129
    )
    
    
    (0.9
    )
    
    $
    140,026
    
    
    
    6.8
    
    
    $
    (150,155
    )
    
    
    (107.2
    )
 24




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##### Table of Contents



CONSOLIDATED
     SEGMENT REPORTING
 RECREATION VEHICLES
  Average PricePer Unit
    
    Units
    
    Net ChangeRecreation VehiclesTowables
    
    
    0.3
    %
    
    
    (52.8
    %)
    
    
    (52.5
    %)Motorized
    
    
    (0.1
    )%
    
    
    (69.7
    %)
    
    
    (69.8
    %)
 TOWABLE RECREATION VEHICLES
  25




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MOTORIZED RECREATION VEHICLES
   26




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##### Table of Contents



BUSES
  Average Price Per Unit
    
    Units
    
    Net ChangeBuses
    
    
    (.6
    %)
    
    
    1.8
    %
    
    
    1.2
    %
     27




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##### Table of Contents



Financial Condition and Liquidity
     Critical Accounting Principles
  Impairment of Goodwill, Trademarks and Long-Lived Assets
  28




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##### Table of Contents



Insurance Reserves
  Warranty
  Income Taxes
  Revenue Recognition
  1)
    
    An order for a product has been received from a dealer;
 29




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##### Table of Contents



2)
    
    Written or oral approval for payment has been received from the dealers flooring
institution;3)
    
    A common carrier signs the delivery ticket accepting responsibility for the product as
agent for the dealer; and4)
    
    The product is removed from the Companys property for delivery to the dealer who
placed the order.
  Repurchase Commitments
  Investments
  Accounting Pronouncements
 Business Combinations
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▪
    
    Transaction costs, many of which are currently treated as costs of the acquisition, will
generally be expensed.▪
    
    In-process research and development will be accounted for as an asset, with the cost
recognized as the research and development is realized or abandoned.
These costs are currently expensed at the time of the acquisition.▪
    
    Contingencies, including contingent consideration, will generally be recorded at fair
value
with subsequent adjustments recognized in operations. 
Contingent consideration is currently accounted for as an adjustment of the purchase price.▪
    
    Decreases in valuation allowances on acquired deferred tax assets will be recognized in
operations. Previously such changes were considered to be subsequent
changes in consideration and were recorded as decreases in goodwill.
    Forward Looking Statements
  31




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##### Table of Contents



ITEM 3.Quantitative and Qualitative Disclosures About Market Risk
    
 ITEM 4.Controls and Procedures
  32




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33




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##### Table of Contents



PART II    Other Information
 
 ITEM 1. LEGAL PROCEEDINGS.
    
 ITEM 1A. RISK FACTORS.
  Our repurchase agreements with floor plan lenders could result in increased costs.
  34




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Certain of our notes receivable may have collectability risk.
  35




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##### Table of Contents



ITEM 6. EXHIBITS
 Exhibit
    
    Description31.1
    
    Chief Executive Officers Certification filed pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.31.2
    
    Chief Financial Officers Certification filed pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    Chief Executive Officers Certification furnished pursuant to Section 906 of the
Sarbanes-Oxley Act 2002.32.2
    
    Chief Financial Officers Certification furnished pursuant to Section 906 of the
Sarbanes-Oxley Act 2002.
 
 SIGNATURES
  THOR INDUSTRIES, INC.
           (Registrant)DATE: June  9, 2009
    /s/ Wade F. B. ThompsonWade F. B. ThompsonChairman of the Board, President and Chief Executive OfficerDATE: June 9, 2009
    /s/ Christian G. FarmanChristian G. FarmanSenior Vice President
and Chief Financial Officer 36