##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q/A
 (Amendment No. 1)
 QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 FOR QUARTER ENDED October 31, 2006

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: 937) 596-6849
  o þ
  þ o o
  o þ
  Class
    
    Outstanding at 10/31/2006Common stock, par value
$.10 per share
    
    55,708,686 shares




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Explanatory Note
 (All amounts presented in thousands)
      1




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##### Table of Contents




    
    Part I, Item 1  Financial Statements.
    
    Part I, Item 2  Managements Discussion and Analysis of Financial Condition and
Results of Operations.
    
    Part I, Item 4  Controls and Procedures.
    
    Part II, Item 1  Legal Proceedings.
  2




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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 2. Unregistered Sales of Equity Securities and Use of ProceedsITEM 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 of dollars except unit, share
and per share data.
 
 ITEM 1. Financial Statements
 THOR INDUSTRIES, INC. AND SUBSIDIARIES  CONDENSED CONSOLIDATED BALANCE SHEETS
 October 31, 2006
    
    
    July 31, 2006(As restated,
    
    
    (As restated,see Note 2)
    
    
    see Note 2)ASSETSCurrent assets:Cash and cash equivalents
    
    $
    95,963
    
    
    $
    196,136Investments  short term
    
    
    110,815
    
    
    
    68,237Accounts receivable:Trade
    
    
    153,203
    
    
    
    188,104Other
    
    
    6,060
    
    
    
    5,639Inventories
    
    
    207,168
    
    
    
    183,169Prepaid expenses
    
    
    17,259
    
    
    
    6,533Deferred income taxes
    
    
    12,311
    
    
    
    4,898Total current assets
    
    
    602,779
    
    
    
    652,716Property:Land
    
    
    21,309
    
    
    
    21,323Buildings and improvements
    
    
    132,346
    
    
    
    131,649Machinery and equipment
    
    
    58,470
    
    
    
    55,656Total cost
    
    
    212,125
    
    
    
    208,628Accumulated depreciation
    
    
    53,947
    
    
    
    51,163Property, net
    
    
    158,178
    
    
    
    157,465Investment in Joint ventures
    
    
    2,917
    
    
    
    2,737Other assets:Goodwill
    
    
    165,663
    
    
    
    165,663Non-compete agreements
    
    
    2,604
    
    
    
    2,841Trademarks
    
    
    13,900
    
    
    
    13,900Other
    
    
    10,310
    
    
    
    9,403Total other assets
    
    
    192,477
    
    
    
    191,807TOTAL ASSETS
    
    $
    956,351
    
    
    $
    1,004,725LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    104,986
    
    
    $
    145,609Accrued liabilities:Taxes
    
    
    44,297
    
    
    
    18,709Compensation and related items
    
    
    31,290
    
    
    
    37,161Product warranties
    
    
    60,923
    
    
    
    59,795Promotions and rebates
    
    
    12,612
    
    
    
    12,953Product/property liability and related
    
    
    10,948
    
    
    
    10,423Other
    
    
    7,126
    
    
    
    7,315Total current liabilities
    
    
    272,182
    
    
    
    291,965Deferred income taxes and other liabilities
    
    
    13,862
    
    
    
    12,911Stockholders equity:Common stock  authorized 250,000,000 shares;
issued 57,150,286 shares @ 10/31/06 and 57,100,286
shares @ 7/31/06; par value of $.10 per share
    
    
    5,715
    
    
    
    5,710Additional paid-in capital
    
    
    87,538
    
    
    
    86,538Accumulated other comprehensive income
    
    
    1,874
    
    
    
    1,772Retained earnings
    
    
    635,303
    
    
    
    664,322Less Treasury shares of 1,441,600 @ 10/31/06 & 1,401,200 @ 7/31/06
    
    
    (60,123
    )
    
    
    (58,493
    )Total stockholders equity
    
    
    670,307
    
    
    
    699,849TOTAL LIABILITIES AND STOCKHOLDERS EQUITY
    
    $
    956,351
    
    
    $
    1,004,725
  3




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THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONDENSED CONSOLIDATED INCOME  FOR THE THREE MONTHS ENDED OCTOBER 31, 2006 AND 2005
 Three Months Ended October 312006
    
    
    2005(As restated,
    
    
    (As restated,see Note 2)
    
    
    see Note 2)Net sales
    
    $
    727,716
    
    
    $
    761,323Cost of products sold
    
    
    638,548
    
    
    
    652,828Gross profit
    
    
    89,168
    
    
    
    108,495Selling, general and
administrative expenses
    
    
    43,445
    
    
    
    44,336Interest income
    
    
    2,910
    
    
    
    1,680Interest expense
    
    
    187
    
    
    
    347Other income
    
    
    550
    
    
    
    799Income before income taxes
    
    
    48,996
    
    
    
    66,291Provision for income taxes
    
    
    18,399
    
    
    
    24,918Net income
    
    $
    30,597
    
    
    $
    41,373Average common shares outstanding:Basic
    
    
    55,613,302
    
    
    
    56,568,392Diluted
    
    
    55,904,797
    
    
    
    56,916,818Earnings per common share:Basic
    
    $
    .55
    
    
    $
    .73Diluted
    
    $
    .55
    
    
    $
    .73Regular dividends declared per common share:
    
    $
    .07
    
    
    $
    .00Special dividends declared per common share:
    
    $
    1.00
    
    
    $
    .00Regular dividends paid per common share:
    
    $
    .07
    
    
    $
    .05Special dividends paid per common share:
    
    $
    1.00
    
    
    $
    .25
  4




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THOR INDUSTRIES, INC. AND SUBSIDIARIES
STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS  FOR THE THREE MONTHS ENDED OCTOBER 31, 2006 AND 2005
 2006
    
    
    2005(As restated,
    
    
    (As restated,see Note 2)
    
    
    see Note 2)Cash flows from operating activities:Net income
    
    $
    30,597
    
    
    $
    41,373Adjustments to reconcile net income to net cash (used in)
provided by operating activities:Depreciation
    
    
    3,226
    
    
    
    2,781Amortization
    
    
    237
    
    
    
    237Deferred income taxes
    
    
    (7,700
    )
    
    
    Loss on disposition of assets
    
    
    103
    
    
    
    2Loss on disposition of trading investments
    
    
    104
    
    
    
    100Unrealized loss on trading investments
    
    
    
    
    
    
    116Stock based compensation
    
    
    160
    
    
    
    259Changes in non cash assets and liabilities, net of effect
from acquisitions:Purchases of trading investments
    
    
    
    
    
    
    (64,387
    )Proceeds from disposition of trading investments
    
    
    68,133
    
    
    
    33,361Accounts receivable
    
    
    34,480
    
    
    
    (41,587
    )Inventories
    
    
    (23,999
    )
    
    
    (22,681
    )Prepaids and other
    
    
    (11,783
    )
    
    
    (9,911
    )Accounts payable
    
    
    (40,752
    )
    
    
    3,581Accrued liabilities
    
    
    20,840
    
    
    
    34,275Other liabilities
    
    
    943
    
    
    
    (18
    )Net cash provided by (used in) operating activities
    
    
    74,589
    
    
    
    (22,499
    )Cash flows from investing activities:Purchase of property, plant & equipment
    
    
    (4,076
    )
    
    
    (6,979
    )Proceeds from disposition of assets
    
    
    171
    
    
    
    20Purchases of available for sale investments
    
    
    (186,125
    )
    
    
    Proceeds from sale of available for sale investments
    
    
    75,567
    
    
    
    Net cash used in investing activities
    
    
    (114,463
    )
    
    
    (6,959
    )Cash flows from financing activities:Cash dividends
    
    
    (59,616
    )
    
    
    (17,000
    )Purchase of common stock held as treasury shares
    
    
    (1,630
    )
    
    
    Proceeds from issuance of common stock
    
    
    845
    
    
    
    43Net cash used in financing activities
    
    
    (60,401
    )
    
    
    (16,957
    )Effect of exchange rate changes on cash
    
    
    102
    
    
    
    411Net decrease in cash and equivalents
    
    
    (100,173
    )
    
    
    (46,004
    )Cash and equivalents, beginning of period
    
    
    196,136
    
    
    
    163,596Cash and equivalents, end of period
    
    $
    95,963
    
    
    $
    117,592Supplemental cash flow information:Income taxes paid
    
    $
    106
    
    
    $
    12Interest paid
    
    
    187
    
    
    
    347Non cash transactions:Capital expenditures in accounts payable
    
    $
    129
    
    
    $
    776
  5




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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 1.
    
    The July 31, 2006 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/A for the year ended July 31, 2006. The results of operations for
the three months ended October 31, 2006 are not necessarily indicative of the results for the
full year.
 2.
    
    Restatement of Financial StatementsOn January 29, 2007, we announced that the Audit Committee of our Board of Directors (the
Audit Committee) initiated an independent investigation regarding certain accounting issues
at our Dutchmen Manufacturing, Inc. operating subsidiary (Dutchmen). The Vice President of
Finance at Dutchmen was intentionally understating the cost of products sold during the periods
restated, primarily by overstating inventory and accounts receivable and understating accounts
payable. We promptly and voluntarily informed the SEC of the Audit Committees investigation,
and have been responding to SEC staff requests for additional information in connection with
the staffs investigation. The Audit Committee, assisted by independent outside legal counsel
and accounting experts, thoroughly investigated the accounting issues raised at Dutchmen. The
Audit Committee and its advisors also reviewed the internal controls at Dutchmen and other
subsidiaries.The Audit Committees investigation confirmed the Companys determination that the income
before income taxes recorded by Dutchmen was overstated during the periods restated, as a
result of misconduct by Dutchmens former Vice President of Finance, the senior financial
officer of Dutchmen.The Company has restated its previously issued financial statements as of July 31, 2006 and
October 31, 2006 and for the three months ended October 31, 2006 and 2005. The restatement
followed the Companys evaluation, considering the results from the Audit Committees
investigation, of accounting practices employed at Dutchmen during these periods.The following tables show the previously reported, restatement adjustment and restated amounts
for those accounts in the Consolidated Balance Sheets at October 31, 2006 and July 31, 2006,
and the Statements of Consolidated Income and Cash Flows for the three month period ended
October 31, 2006 and 2005, affected by the restatement.
 Previously
    
    RestatementReported
    
    adjustment
    
    RestatedConsolidated Balance Sheet 
October 31, 2006Accounts receivable  trade
    
    $
    159,951
    
    
    $
    (6,748
    )
    
    $
    153,203Inventories
    
    
    215,155
    
    
    
    (7,987
    )
    
    
    207,168Total current assets
    
    
    617,514
    
    
    
    (14,735
    )
    
    
    602,779Total assets
    
    
    971,086
    
    
    
    (14,735
    )
    
    
    956,351Accounts payable
    
    
    95,399
    
    
    
    9,587
    
    
    
    104,986Taxes
    
    
    53,363
    
    
    
    (9,066
    )
    
    
    44,297Total current liabilities
    
    
    271,661
    
    
    
    521
    
    
    
    272,182Retained earnings
    
    
    650,559
    
    
    
    (15,256
    )
    
    
    635,303Total stockholders equity
    
    
    685,563
    
    
    
    (15,256
    )
    
    
    670,307Total liabilities and stockholders equity
    
    
    971,086
    
    
    
    (14,735
    )
    
    
    956,351
 6




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Previously
    
    Restatementreported
    
    adjustment
    
    RestatedConsolidated Balance Sheet
July 31, 2006Accounts receivable  trade
    
    $
    191,299
    
    
    $
    (3,195
    )
    
    $
    188,104Inventories
    
    
    187,091
    
    
    
    (3,922
    )
    
    
    183,169Total current assets
    
    
    659,833
    
    
    
    (7,117
    )
    
    
    652,716Total assets
    
    
    1,011,842
    
    
    
    (7,117
    )
    
    
    1,004,725Accounts payable
    
    
    131,606
    
    
    
    14,003
    
    
    
    145,609Taxes
    
    
    26,574
    
    
    
    (7,865
    )
    
    
    18,709Total current liabilities
    
    
    285,827
    
    
    
    6,138
    
    
    
    291,965Retained earnings
    
    
    677,577
    
    
    
    (13,255
    )
    
    
    664,322Total stockholders equity
    
    
    713,104
    
    
    
    (13,255
    )
    
    
    699,849Total liabilities and stockholders equity
    
    
    1,011,842
    
    
    
    (7,117
    )
    
    
    1,004,725
 Previously
    
    Restatementreported
    
    adjustment
    
    RestatedStatement of Consolidated Income
Three months ended October 31, 2006Cost of products sold
    
    $
    635,346
    
    
    $
    3,202
    
    
    $
    638,548Gross profit
    
    
    92,370
    
    
    
    (3,202
    )
    
    
    89,168Income before income taxes
    
    
    52,198
    
    
    
    (3,202
    )
    
    
    48,996Provision for income taxes
    
    
    19,600
    
    
    
    (1,201
    )
    
    
    18,399Net income
    
    
    32,598
    
    
    
    (2,001
    )
    
    
    30,597Statement of Consolidated Cash Flow
Three months ended October 31, 2006Cash flows from operating activitiesNet income
    
    $
    32,598
    
    
    $
    (2,001
    )
    
    $
    30,597Accounts receivable
    
    
    30,927
    
    
    
    3,553
    
    
    
    34,480Inventories
    
    
    (28,064
    )
    
    
    4,065
    
    
    
    (23,999
    )Accounts payable
    
    
    (36,336
    )
    
    
    (4,416
    )
    
    
    (40,752
    )Accrued liabilities
    
    
    22,041
    
    
    
    (1,201
    )
    
    
    20,840Earnings per common share
Three months ended October 31, 2006Basic
    
    $
    .59
    
    
    $
    (.04
    )
    
    $
    .55Diluted
    
    $
    .58
    
    
    $
    (.03
    )
    
    $
    .55
 Previously
    
    Restatementreported
    
    adjustment
    
    RestatedStatement of Consolidated Income
Three months ended October 31, 2005Cost of products sold
    
    $
    649,681
    
    
    $
    3,147
    
    
    $
    652,828Gross profit
    
    
    111,642
    
    
    
    (3,147
    )
    
    
    108,495Income before income taxes
    
    
    69,438
    
    
    
    (3,147
    )
    
    
    66,291Provision for income taxes
    
    
    26,073
    
    
    
    (1,155
    )
    
    
    24,918Net income
    
    
    43,365
    
    
    
    (1,992
    )
    
    
    41,373Statement of Consolidated Cash Flow 
Three months ended October 31, 2005Cash flows from operating activities
Net income
    
    $
    43,365
    
    
    $
    (1,992
    )
    
    $
    41,373Accounts receivable
    
    
    (38,998
    )
    
    
    (2,589
    )
    
    
    (41,587
    )Inventories
    
    
    (25,278
    )
    
    
    2,597
    
    
    
    (22,681
    )Accounts payable
    
    
    442
    
    
    
    3,139
    
    
    
    3,581Accrued liabilities
    
    
    35,430
    
    
    
    (1,155
    )
    
    
    34,275Earnings per common share
Three months ended October 31, 2005Basic
    
    $
    .77
    
    
    $
    (.04
    )
    
    $
    .73Diluted
    
    $
    .76
    
    
    $
    (.03
    )
    
    $
    .73
 7




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3.
    
    Major classifications of inventories are:
 October 31, 2006
    
    
    July 31, 2006Raw materials
    
    $
    96,992
    
    
    $
    99,807Chassis
    
    
    52,621
    
    
    
    39,772Work in process
    
    
    52,496
    
    
    
    51,208Finished goods
    
    
    27,803
    
    
    
    13,416Total
    
    
    229,912
    
    
    
    204,203Less excess of FIFO costs
over LIFO costs
    
    
    22,744
    
    
    
    21,034Total inventories
    
    $
    207,168
    
    
    $
    183,169
 4.
    
    Earnings Per Share
 Three Months
    
    Three MonthsEnded
    
    EndedOctober 31, 2006
    
    October 31, 2005Weighted average shares
outstanding for basic
earnings per share
    
    
    55,613,302
    
    
    
    56,568,392Stock options and
restricted stock
    
    
    291,495
    
    
    
    348,426Total  For diluted shares
    
    
    55,904,797
    
    
    
    56,916,818
 5.
    
    Comprehensive Income
 Three Months
    
    
    Three MonthsEnded
    
    
    EndedOctober 31, 2006
    
    
    October 31, 2005Net income
    
    $
    30,597
    
    
    $
    41,373Foreign currency translation adj.
    
    
    102
    
    
    
    411Comprehensive income
    
    $
    30,699
    
    
    $
    41,784
 6.
    
    Segment Information
  Three Months
    
    
    Three MonthsEnded
    
    
    EndedOctober 31, 2006
    
    
    October 31, 2005Net Sales:Recreation vehicles:Towables
    
    $
    499,955
    
    
    $
    533,236Motorized
    
    
    135,923
    
    
    
    149,094Total recreation vehicles
    
    
    635,878
    
    
    
    682,330Buses
    
    
    91,838
    
    
    
    78,993Total
    
    $
    727,716
    
    
    $
    761,323
 8




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Three Months
    
    
    Three MonthsEnded
    
    
    EndedOctober 31, 2006
    
    
    October 31, 2005Income Before Income Taxes:Recreation vehicles:Towables
    
    $
    40,400
    
    
    $
    58,277Motorized
    
    
    6,068
    
    
    
    8,366Total recreation vehicles
    
    
    46,468
    
    
    
    66,643Buses
    
    
    3,020
    
    
    
    1,994Corporate
    
    
    (492
    )
    
    
    (2,346
    )Total
    
    $
    48,996
    
    
    $
    66,291
 October 31, 2006
    
    
    July 31, 2006Identifiable Assets:Recreation vehicles:Towables
    
    $
    458,833
    
    
    $
    483,324Motorized
    
    
    150,782
    
    
    
    150,058Total recreation vehicles
    
    
    609,615
    
    
    
    633,382Buses
    
    
    113,919
    
    
    
    103,861Corporate
    
    
    232,817
    
    
    
    267,482Total
    
    $
    956,351
    
    
    $
    1,004,725
 7.
    
    Treasury Shares
  8.
    
    Investments
    9.
    
    Goodwill and Other Intangible Assets
  October 31, 2006
    
    July 31, 2006Accumulated
    
    
    
    
    
    AccumulatedCost
    
    Amortization
    
    Cost
    
    AmortizationAmortized Intangible Assets:Non-compete agreements
    
    $
    15,889
    
    
    $
    13,285
    
    
    $
    15,889
    
    
    $
    13,048
 9




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Three Months
    
    Three MonthsEnded
    
    EndedOctober 31, 2006
    
    October 31, 2005Non-compete Agreements:Amortization Expense
    
    $
    237
    
    
    $
    237
  Estimated Amortization Expense:For the year ending July 2007
    
    $
    887For the year ending July 2008
    
    $
    828For the year ending July 2009
    
    $
    492For the year ending July 2010
    
    $
    337For the year ending July 2011
    
    $
    239
   Goodwill
    
    
    TrademarksRecreation Vehicles:Towables
    
    $
    143,795
    
    
    $
    10,237Motorized
    
    
    17,252
    
    
    
    2,600Total Recreation Vehicles
    
    
    161,047
    
    
    
    12,837Bus
    
    
    4,616
    
    
    
    1,063Total
    
    $
    165,663
    
    
    $
    13,900
 10.
    
    Warranty
  Three Months
    
    
    Three MonthsEnded
    
    
    EndedOctober 31, 2006
    
    
    October 31, 2005Beginning Balance
    
    $
    59,795
    
    
    $
    55,118Provision
    
    
    17,951
    
    
    
    15,967Payments
    
    
    (16,823
    )
    
    
    (14,973
    )Ending Balance
    
    $
    60,923
    
    
    $
    56,112
 11.
    
    Commercial Commitments
  10




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Total
    
    Term ofCommitment
    
    Amount Committed
    
    GuaranteeGuarantee on dealer financing
    
    $
    2,521
    
    
    less than 1 yearStandby repurchase obligation
on dealer financing
    
    $
    846,754
    
    
    less than 1 year
  Three Months
    
    
    Three MonthsEnded
    
    
    EndedOctober 31, 2006
    
    
    October 31, 2005Cost of units repurchased
    
    $
    1,961
    
    
    $
    1,350Realization on units resold
    
    
    1,543
    
    
    
    1,272Losses due to repurchase
    
    $
    418
    
    
    $
    78
 11




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##### Table of Contents



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
      Restatement
  12




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Trends and Business Outlook
    13




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THREE MONTHS ENDED OCTOBER 31, 2006 VS. THREE MONTHS ENDED OCTOBER 31, 2005
 Three Months Ended
    
    
    Three Months Ended
    
    
    ChangeOctober 31, 2006
    
    
    October 31, 2005
    
    
    Amount
    
    
    %NET SALES:Recreation VehiclesTowables
    
    $
    499,955
    
    
    $
    533,236
    
    
    $
    (33,281
    )
    
    
    (6.2
    )Motorized
    
    
    135,923
    
    
    
    149,094
    
    
    
    (13,171
    )
    
    
    (8.8
    )Total Recreation Vehicles
    
    
    635,878
    
    
    
    682,330
    
    
    
    (46,452
    )
    
    
    (6.8
    )Buses
    
    
    91,838
    
    
    
    78,993
    
    
    
    12,845
    
    
    
    16.3Total
    
    $
    727,716
    
    
    $
    761,323
    
    
    $
    (33,607
    )
    
    
    (4.4
    )# OF UNITS:Recreation VehiclesTowables
    
    
    23,490
    
    
    
    27,518
    
    
    
    (4,028
    )
    
    
    (14.6
    )Motorized
    
    
    1,855
    
    
    
    2,019
    
    
    
    (164
    )
    
    
    (8.1
    )Total Recreation Vehicles
    
    
    25,345
    
    
    
    29,537
    
    
    
    (4,192
    )
    
    
    (14.2
    )Buses
    
    
    1,557
    
    
    
    1,468
    
    
    
    89
    
    
    
    6.1Total
    
    
    26,902
    
    
    
    31,005
    
    
    
    (4,103
    )
    
    
    (13.2
    )
 % of
    
    
    
    
    
    
    % ofSegment
    
    
    
    
    
    
    SegmentNet Sales
    
    
    
    
    
    
    Net SalesGROSS PROFIT:Recreation VehiclesTowables
    
    $
    69,822
    
    
    
    14.0
    
    
    $
    87,617
    
    
    
    16.4
    
    
    $
    (17,795
    )
    
    
    (20.3
    )Motorized
    
    
    12,639
    
    
    
    9.3
    
    
    
    15,301
    
    
    
    10.3
    
    
    
    (2,662
    )
    
    
    (17.4
    )Total Recreation Vehicles
    
    
    82,461
    
    
    
    13.0
    
    
    
    102,918
    
    
    
    15.1
    
    
    
    (20,457
    )
    
    
    (19.9
    )Buses
    
    
    6,707
    
    
    
    7.3
    
    
    
    5,577
    
    
    
    7.1
    
    
    
    1,130
    
    
    
    20.3Total
    
    $
    89,168
    
    
    
    12.3
    
    
    $
    108,495
    
    
    
    14.3
    
    
    $
    (19,327
    )
    
    
    (17.8
    )SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:Recreation VehiclesTowables
    
    $
    29,429
    
    
    
    5.9
    
    
    $
    29,372
    
    
    
    5.5
    
    
    $
    57
    
    
    
    0.2Motorized
    
    
    6,556
    
    
    
    4.8
    
    
    
    6,933
    
    
    
    4.7
    
    
    
    (377
    )
    
    
    (5.4
    )Total Recreation Vehicles
    
    
    35,985
    
    
    
    5.7
    
    
    
    36,305
    
    
    
    5.3
    
    
    
    (320
    )
    
    
    (0.9
    )Buses
    
    
    3,493
    
    
    
    3.8
    
    
    
    3,463
    
    
    
    4.4
    
    
    
    30
    
    
    
    0.9Corporate
    
    
    3,967
    
    
    
    
    
    
    
    4,568
    
    
    
    
    
    
    
    (601
    )
    
    
    (13.2
    )Total
    
    $
    43,445
    
    
    
    6.0
    
    
    $
    44,336
    
    
    
    5.8
    
    
    $
    (891
    )
    
    
    (2.0
    )INCOME BEFORE INCOME TAXES:Recreation VehiclesTowables
    
    $
    40,400
    
    
    
    8.1
    
    
    $
    58,277
    
    
    
    10.9
    
    
    $
    (17,877
    )
    
    
    (30.7
    )Motorized
    
    
    6,068
    
    
    
    4.5
    
    
    
    8,366
    
    
    
    5.6
    
    
    
    (2,298
    )
    
    
    (27.5
    )Total Recreation Vehicles
    
    
    46,468
    
    
    
    7.3
    
    
    
    66,643
    
    
    
    9.8
    
    
    
    (20,175
    )
    
    
    (30.3
    )Buses
    
    
    3,020
    
    
    
    3.3
    
    
    
    1,994
    
    
    
    2.5
    
    
    
    1,026
    
    
    
    51.5Corporate
    
    
    (492
    )
    
    
    
    
    
    
    (2,346
    )
    
    
    
    
    
    
    1,854
    
    
    
    79.0Total
    
    $
    48,996
    
    
    
    6.7
    
    
    $
    66,291
    
    
    
    8.7
    
    
    $
    (17,295
    )
    
    
    (26.1
    )
 As of
    
    
    As of
    
    
    ChangeOctober 31, 2006
    
    
    October 31, 2005
    
    
    Amount
    
    
    %ORDER BACKLOGRecreation VehiclesTowables
    
    $
    120,627
    
    
    $
    252,301
    
    
    $
    (131,674
    )
    
    
    (52.2
    )Motorized
    
    
    67,799
    
    
    
    80,627
    
    
    
    (12,828
    )
    
    
    (15.9
    )Total Recreation Vehicles
    
    
    188,426
    
    
    
    332,928
    
    
    
    (144,502
    )
    
    
    (43.4
    )Buses
    
    
    217,864
    
    
    
    140,421
    
    
    
    77,443
    
    
    
    55.2Total
    
    $
    406,290
    
    
    $
    473,349
    
    
    $
    (67,059
    )
    
    
    (14.2
    )
 14




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CONSOLIDATED
    Segment Reporting
 RECREATION VEHICLES
  Average PricePer Unit
    
    Units
    
    Net ChangeRecreation VehiclesTowables
    
    
    8.4
    %
    
    
    (14.6
    )%
    
    
    (6.2
    )%Motorized
    
    
    (.7
    )%
    
    
    (8.1
    )%
    
    
    (8.8
    )%
 Towable Recreation Vehicles
    Motorized Recreation Vehicles
  15




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##### Table of Contents



BUSES
  Average Price Per Unit
    
    Units
    
    Net ChangeBuses
    
    
    10.2
    %
    
    
    6.1
    %
    
    
    16.3
    %
    Financial Condition and Liquidity
    16




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##### Table of Contents



Critical Accounting Principles
  Impairment of Goodwill, Trademarks and Long-Lived Assets
  Insurance Reserves
  Warranty
  Income Taxes
  17




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Revenue Recognition
  1)
    
    An order for a product has been received from a dealer;
 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; and
 4)
    
    The product is removed from the Companys property for delivery to the dealer who placed the
order.
  Repurchase Commitments
  Forward Looking Statements
  
 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
  18




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ITEM 4. Controls and Procedures
    Segregation of Duties.
  19




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
    
    The Company has terminated the employment of the Dutchmen Vice President of Finance
and has hired a new Vice President of Finance at Dutchmen;
 
    
    The Company has eliminated the excessive accounting and information system access
rights found to be available to the Dutchmen Vice President of Finance;
 
    
    Since discovery of the activities of the former Dutchmen Vice President of Finance,
the Company has assigned a member of its internal audit department to Dutchmen to
assist in implementing full segregation of duties in Dutchmens accounting function;
 
    
    The Company is modifying the duties of accounting personnel to improve segregation
of duties and modifying certain information access rights at certain of its other
operating subsidiaries;
 
    
    The Company is providing additional training on fraud risk and awareness and
assisting management and other key personnel to understand the lessons learned through
the Dutchmen review;
 20




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##### Table of Contents




    
    To improve the Companys oversight of internal controls at its subsidiaries, the
Companys Board of Directors has hired a professional services firm to lead and
coordinate ongoing
compliance efforts under Sarbanes-Oxley section 404 and partner with the internal audit
function of the Company;
 
    
    More frequent and in-depth periodic, unannounced internal audits of controls will be
conducted at the subsidiary level;
 
    
    The Company has enhanced its corporate level monitoring of the operating
subsidiaries accounts receivable, accounts payable and cash reconciliations, including
verification that financial information submitted by the operating subsidiaries agrees
with the financial information recorded in the operating subsidiaries information
systems; and
 
    
    The Company has modified its reporting relationships so that heads of subsidiary
accounting departments report directly to the Chief Financial Officer of the Company as
opposed to subsidiary level presidents.
 
 PART II    Other Information
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
 (c)
    
    ISSUER PURCHASES OF EQUITY SECURITIES
 (c) Total Number
    
    (d) Maximum Numberof Shares
    
    (or Approximate(a) Total
    
    (b)
    
    (or Units)
    
    Dollar Value)Number
    
    Average
    
    Purchased as
    
    of Shares (or Units)of Shares
    
    Price Paid
    
    Part of Publicly
    
    that May Yet Be(or Units)
    
    Per Share
    
    Announced Plans
    
    Purchased Under thePeriod
    
    Purchased
    
    (or Unit)
    
    or Programs (1)
    
    Plans or ProgramsAugust 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,987,600September 2006
    
    
    20,100
    
    
    $
    39.94
    
    
    
    20,100
    
    
    
    1,967,500October 2006
    
    
    20,300
    
    
    $
    40.72
    
    
    
    20,300
    
    
    
    1,947,200
 
 (1)
    
    On March 11, 2003, we announced that our Board of Directors had approved a share repurchase
program, pursuant to which up to 1,000,000 shares of our common stock may be repurchased. In the
second quarter of fiscal 2004, we affected a two-for-one stock split, resulting in 2,000,000
shares authorized for repurchase under the program. On June 26, 2006 our Board of Directors
authorized the repurchase of an additional 2,000,000 shares extending over a 24-month period
before expiring. At October 31, 2006, 1,947,200 shares of common stock remained authorized for
repurchase under the repurchase program. 21




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ITEM 6. Exhibits
 a.) Exhibits
     22




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SIGNATURES
  THOR INDUSTRIES, INC.
(Registrant)DATE:  June 12, 2007
    /s/ Wade F. B. ThompsonWade F. B. ThompsonChairman of the Board, President
and Chief Executive Officer DATE:  June 12, 2007
    /s/ Walter L. BennettWalter L. BennettExecutive Vice President,
Secretary and Chief Financial Officer 23