Welcome to the first quarter Winnebago Industries earnings conference call. At this time all participants are in a listen only mode. We will conduct a question and answer session towards the end of this conference. (Operator Instructions) I would now like to turn the call over to Ms. Sheila Davis, Public Relations and Investor Relations Manager.

Welcome to the Winnebago Industries Incorporated conference call to review the company’s results for the first quarter of fiscal year 2010 ended November 28, 2009. Conducting the call today are Bob Olsen, Winnebago Industries’ Chairman of the Board, Chief Executive Officer and President and Sarah Nielsen, Vice President & Chief Financial Officer. I trust each of you have received a copy of the news release with our earnings results this morning. This call is being broadcast live on our website at WinnebagoInd.com. A replay of the call will be available on our website at approximately 12 o’clock noon central time today. If you have any questions about accessing any of this information, please call our investor relations department at 641-585-6803 following the conference call. Before we start, it’s my duty to inform you that this presentation may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements are inherently uncertain. A number of factors could cause actual results to differ materially from these statements. These factors are identified in our filings with the Securities & Exchange Commission over the last 12 months, copies of which are available from the SEC or from the company upon request. I’ll now turn the call over to Bob Olsen.

Welcome to Winnebago Industries’ first quarter conference call. Sarah will go in to the results for our first quarter of fiscal year 2010 shortly but it is evident from our news release that we are extremely pleased to see an improvement in our motor home delivery volumes. As a result of these increased volumes, we were also able to achieve an increase in revenues and have posted a small gross profit in our first quarter. Last quarter I said we were hopeful that we were at or near the bottom of the downward cycle and that the worst may soon be over. I truly believe we have reached the bottom during our first quarter. While the winter months may still be challenging, I believe we can now look for growth. The general economy is looking healthier with slightly improved consumer confidence, stable fuel prices, low interest rates and an improved equity market. The credit market is still difficult but improving. There are fewer lenders now available and those who remain have more stringent expectations of who they lend to. Existing lenders are also more cautious but fortunately they are focused on partnering with strong manufacturers like Winnebago Industries. Along with these economic improvements, our product line up for 2010 continues to be very well received by our dealers as well as retail customers. The latest results from Statistical Surveys Incorporated, the retail reporting service for the RV industry demonstrates we are gaining market share. Calendar year-to-date through October 2009 results were reported earlier this week and illustrated market share growth for Winnebago Industries in the combined Class A and C market as well as substantial improvement in our Class A diesel market. Combined market share results for calendar 2009 year-to-date through October were 19.3% compared to 18.3% for the same…

I will now review the financial performance for the company’s first quarter of fiscal year 2010. Revenues for the first quarter were $81 million, a 16.7% increase from the first quarter of fiscal 2009. This is primarily a result of an increase in motor home delivers of 138 units or 21%. Industry wholesale shipments as reported as [RVIA for the first two months of our fiscal quarter were down 16.1%. Our average selling price increased slightly by .8% for the quarter as compared to last year. Although 52% of our volume was Class A product as opposed to 43% last year, much of our Class A volume was in the entry level gas and diesel price points due to new product introductions. However, our average selling price did increase sequentially from the fourth quarter of fiscal 2009 by 8.3%. Partially offsetting the motor home revenue increase was a decrease in our non-motor home revenue areas of 2.6% or $2.5 million. Increased motor home production during the first quarter resulted in improved labor efficiencies, reduced labor costs and better absorption of fixed costs as compared to the prior year. These items had a positive financial impact and resulted in a small gross profit margin of .6% as compared to a gross deficit of 12.8% in the prior year. SG&A expenses were $1.5 million less in the same quarter last year. This was due to reduced legal fees and lower wage related expenses as a result of reduced headcount and salary reductions as compared to last year. From a tax perspective, we did record a tax benefit of $4.9 million this quarter. This was due to the fact that in November there was a new tax law signed by the president which expands the carry back period from two to five years,…

(Operator Instructions) Your first question comes from Scott Stember – Sidoti & Company, LLC. Scott Stember – Sidoti & Company, LLC.: As usual can you give me the ASPs by class this year and last year?

When you break out our classes of units, for the first quarter of 2010, Class A gas was $90,158 as compared to $94,982 last year. Class A diesel was $149,660 as compared to $168,691 last year. Then, combined Class A total for this quarter is $115,966 as compared to $125,716 a year ago. Class C was $73,520 as compared to $70,316. Total As and Cs $97,585 as compared to $95,562 and then Class B $63,698 as compared to $69,501. All in then is $94,938 as compared to $94,172. Scott Stember – Sidoti & Company, LLC.: Could you talk about where you stand right now with capacity utilization? And Sarah, maybe just update us on I think last quarter you had said in the 1,600 to 1,800 units per quarter range to break even per quarter. Can you just talk about those two things?

I’ll start out with the capacity utilization, for the first quarter we were right at 31% capacity utilization. That compares to what we reported last quarter around 22%. So, as you can see we are starting to fill up a little bit of our capacity which is a good thing.

From a breakeven standpoint we are looking at the positive backlog improvement as very helpful prospectively. It gives us better visibility in regards to scheduling our production. The ranges that we have highlighted have widened and we had a lot of mitigating variables to be considering and I have nothing new to update at this juncture. Some of the positives that we saw in this first quarter as a result of hiring some hourly employees back have created a little bit of a faster benefit. Our average hourly wage rate has dropped and our labor efficiencies are improving as we are busier and we are becoming more efficient at lower levels than what our history has been. Those are all positives. Near term, the second quarter as Bob highlighted, we do have four holidays and an inventory day so we have fewer days of production and just the seasonal time frame is going to be increased heating and utility costs. A lot of the taxes associated with unemployment and other payroll types of items restart in January so there is some increase in that front. But, we are pretty excited in regards to the fact that we have under produced at the wholesale level at such a long period of time and you are looking at a juncture where our backlog reflects that increased demand. Our dealers have to restock and that’s an exciting point of time to be at as compared to where we were a year ago and in previous quarters. Scott Stember – Sidoti & Company, LLC.: As far as ramping up production I imagine that you guys want to keep up with your backlog but at the same time this is not a normal time of year to be building up so much. Is it safe to assume that you guys could probably work through your entire backlog within the quarter or given the fewer days and so forth probably not quite as busy.

I think that one thing that we’ve always said is that our backlog is anything within the next six months so we’ve got some that are within this quarter, some that could be in next quarter. As Sarah said, we’ve got four holidays, we’ve got an inventory day that we’ve got to worry about in this quarter. We live in North Iowa so you also have that concern over snow days. We just had a blizzard here last week and the weather will impact us. So with what we’ve got for a backlog right now. We won’t be able to gear up fast enough to satisfy that backlog that we’ve got. Scott Stember – Sidoti & Company, LLC.: I know you guys don’t give guidance but assuming that you guys were to fall short of the 1,500 units that you have in backlog right now and the comments are that you made in the past about breakeven, it seems that it will be difficult to turn a profit this quarter?

You’re right that we are going to be deviating from past practice in regards to providing any guidance. We are at a positive downturn in regards to a lot of things improving on a year-over-year basis. When you look at where we were in the second quarter of last year, we only had $32 million of revenue and we only shipped 316 motor homes so the comps are very poor in regards to where we think we can be this year. But, I guess it’s going to be a story of what’s the mix and what’s the volumes and how all this plays out as we ramp back up. I do want to highlight a point that Bob made as well is from a supplier’s standpoint they’re in a ramp up situation as well to a certain degree and if everything doesn’t happen just perfectly, we could be experiencing issues on that front and those are the day-by-day challenges that we have to work through but it’s not just completely in our control as well as to what we can accomplish because there is a lot of other companies that have cut workforce and production levels and they have to ramp up as well.

I think in addition to that we continually have opportunities with raw material supplies as Sarah mentioned but the other thing that we can’t lose sight of is that we were in such a deep hole in trying to dig out of this thing and on top of that we are in our historically toughest quarter that we’ve got so it’s going to be a very difficult quarter but we feel very optimistic that we’re heading in the right direction but we’ve still got a lot of headwind in front of us.

Your next question comes from Craig R. Kennison – Robert W. Baird & Co., Inc. Craig R. Kennison – Robert W. Baird & Co., Inc.: Sarah do you see a need to draw on your credit agreement in this quarter as you ramp up production steeply?

In light of the sizeable tax receivable that we’re looking at inside the quarter and no, we don’t think that we’re going to be in the near term borrowing on that facility in regards to our liquidity levels. But, there’s typically usually a 45 day time frame in which when you file the turn and when they provide the payment from the federal government so obviously they’re dealing with a lot of carry back filers as well so we’ll have to see how that plays out. We do think that we’re going to be in a decent liquidity position for the next three quarters. Craig R. Kennison – Robert W. Baird & Co., Inc.: In the past you’ve talked about the fixed level of cost of goods sold and then your contribution margin and my notes would say that the fixed cost of goods sold is about $42 million and that your contribution margins are maybe 15% or 18% depending on the type of unit. Is that still the right ballpark or have things meaningfully changed with your employment levels or discounting and things like that?

Well, we’re definitely seeing positives in regards to all the percentages as far as how they play out. I don’t think we’re quite there yet from a variable cost perspective where we have historically have been. It looks like from a fixed cost standpoint I think prior to a lot of the cost cutting measures we were more in the range just on the cost of goods sold standpoint excluding SG&A $40 million plus on an annualized basis. That has moved down because of a lot of the fixed costs that we have really eliminated from our cost structure. We have to be careful as well, you’ll note from a hiring standpoint we have only hired hourly positions. We’re very conscious in regards to not adding back any fixed costs as we are dealing with a ramp up situation. But outside of I just think of how soon we can return to some of the percentages on the variable side that you were highlighting there and our fixed cost at a lower level than maybe the norm had been that those would be the two things that I would highlight as a little bit of a difference. Craig R. Kennison – Robert W. Baird & Co., Inc.: Then just to clarify then your fixed cost of goods sold excluding SG&A was north of $40 million, now might be $35 or $40 million?

Yes, $35 million. Craig R. Kennison – Robert W. Baird & Co., Inc.: Then the contribution margin was historically maybe 15% on a C and 18% on an A but today might be what? What would be the right expectation?

Well, I’m looking at it from a quarter snapshot which is probably not the light that you’re looking at but the variable costs in this quarter were not quite at that level, a 15% range. You’re looking more at a 10% range from a variable cost perspective. Craig R. Kennison – Robert W. Baird & Co., Inc.: But it would seemingly improve even with volumes coming back?

That’s very fair.

Your next question comes from Kathryn Thompson – Thompson Research Group. Kathryn Thompson – Thompson Research Group: Could you comment on backlog trends at the Louisville Show? And also, just color on order trends since the quarter end and particularly if you could comment on mix.

I think the mix has been really good for us. It’s kind of across the board that we’re seeing order activity but I will say that with pricing stronger than normal on our diesel and on our Class A entry coach but we’re very pleased with what we’re seeing overall. It’s been pretty strong overall activity on all our products. Kathryn Thompson – Thompson Research Group: Historically Class A diesel had been a little bit better margin, is that still the case?

Yes, it is. Kathryn Thompson – Thompson Research Group: You commented last quarter a little bit about time off and you mentioned it a little bit earlier in your prepared comments, how much time specifically do you anticipate taking off this year and compare that against last year putting in perspective how many lines were actually on production last year at the same time versus this year?

Well, during our holiday season last year and I’m going to have to tap in to my memory, but I think we took two weeks off if I recall right so we had no assembly lines working during that time. That was about the time that we were alternating between a couple of our lines, one week the line would be on, the next week the other line would be on while the other one was off. We had started converting our line two, our diesel line basically from a mechanical line to a stall build operation. I’m very pleased to say that all three lines are mechanical lines, they are all running, not up obviously to capacity yet but as far as what we are working over the holiday season, I think you know Kathryn I’ve been here a lot of years and this is the first year that I can ever remember that we’re going to be working during the holiday season. We will take the four holidays that we’ve got, the Christmas and New Year’s period we’ll take those obviously but the three days prior to Christmas and then the three days after are going to be considered work days and that is a first at this company. Kathryn Thompson – Thompson Research Group: I also wanted to get your thoughts and talk a little bit about dealers being more selective but could you also talk about wholesale financing trends and how financers are being a little bit more choosier in the market and how in the current recovery how are financing trends different now than it was in the previous peak downturn?

Well, I think and Sarah can chime in here as well, I think it’s one of those situations where the finance companies, and we said all along that they have a hand in this recovery we feel but first of all they’re going to be looking at dealer’s inventory as far as not only what the levels are but what the age of that inventory is. They’re going to be looking at the financials of the dealers themselves to make sure they are healthy, they’re going to be looking at the manufacturers from a standpoint of are they healthy and of course we’re an open book, everybody can see where we’re at as well as for. But, we’ve got several companies now that are privately held but we’ve been assured that they are going to be looking deeply in to their financials to make sure the manufacturers are healthy as well. Obviously, they’re going to be wanting repurchase agreements out of the manufacturers and they’ve put a new emphasis on collecting curtailments. I think they’re going back to the way it was when they first got in to this industry. I can say the same thing for retail financing. They’re expecting down payments, they’re not lending money that is in excess of what the value of the product is. They’re demanding that there’s proof of income. All the same stuff that we did prior to 2004 before we got in to some bad habits. I personally think it’s probably healthy in the long run for our industry. We really got in to some really bad habits in that 2004, 2005 and 2006 timeframe and I think we’re paying the piper now. We often get asked, “So do you think we can see a 60,000, 70,000 or 80,000 unit industry with the new expectations on financing?” I strongly believe we can because I think we’re doing nothing more than going back to our grass roots. That’s kind of my take on the financing situation right now. I don’t know Sarah if you want to add anything to that?

Well, I think the one thing that will be very different on a perspective basis than maybe what we’ve seen in the past. But, because of the added discipline or renewed discipline on the wholesale side, if the retail doesn’t support the ordering, that’s going to limit what dealers can do. October retail stats just came out recently and every month is going to be looked at in regards to what is our trend and on an annual basis it’s definitely still lower, much lower the decrease for retail than it is for wholesale. I think parity there is reasonable to expect or assume but if the retail trends don’t support the ordering dealers won’t. I think that’s a dynamic that’s very different. Turns are the focus, two plus and we’re very encouraged in regards to the positive improvement we’ve seen because we haven’t had significant repurchase issues in the last six months and our dealer count has remained fairly constant or flat since May. But, we’re still at the slowest time frame now in the year and I think there’s risk that some dealers are not going to make it through until March but not nearly to the degree or risk we had a year ago at this point. Those are I guess, a few of my thoughts. Kathryn Thompson – Thompson Research Group: I guess the overriding thing that we’ve been hearing that is different from the cycle is that finance contacts increasingly are gravitating towards the stronger manufacturers and in previous recoveries you had stronger startups start off and finance companies are really gravitating towards the better, more financially strong players. I assume that you may also be getting that type of feedback from the B of As of the world?

We’re hearing the same thing. We feel that’s in our favor. Kathryn Thompson – Thompson Research Group: Finally, with dealer inventories down 52% do you anticipate a one-to-one ratio retail sales going forward?

Well as Sarah said, right now wholesale has been running well below retail for many, many months right now. I think once the wholesale catches up I think you’re going to be looking at a one-to-one ratio. But, I think we’ve got the opportunity that we could see possibly more wholesale as the dealer inventories get stocked back up to what that retail level is dictating.

Your next question comes from Analyst for Greg Badishkanian – Citigroup Global Markets, Inc. Analyst for Greg Badishkanian – Citigroup Global Markets, Inc.: I just wanted to go back to the financing, on the retail side I think you mentioned the last time that a couple of the major lenders wanted to increase their RV business. Have they started to do that since the end of the quarter? Have you seen any changes?

Well, from a retail standpoint I think you have a lot more. B of A is still in the industry, Bank of the West has a very sizeable position. I think a lot of the regional and local choices are becoming more of an opportunity for the retail customer but we haven’t seen any significant player reenter the business on the retail side or really on the wholesale side. I think there’s improvement and a year ago we were essentially frozen for sure on the wholesale side for a period of time so a very different dynamic 12 months later. But, the retail players I don’t know if they’ve really dramatically changed here in the last three months.

But, I think with that being said, we certainly appreciate the fact that the lending institutions that have stayed in this industry during these extremely difficult times. But, I still think once the recovery is well on its way and there are other lenders out there that see there are profit opportunities here, I think you’re going to see some of them probably try to get back in to this industry. That’s just the American way. Analyst for Greg Badishkanian – Citigroup Global Markets, Inc.: You mentioned the supply, the raw materials may be an issue. Is that referring to chassis or is it more broad?

Well, right now I think our biggest opportunities that we see is in chassis and it’s also in some of our fabrics. There are a couple of reasons for it, one is their lead times are much longer than what the majority of our suppliers are and obviously you know how big Ford is and they’ve got other things that they have to take in to consideration when they’re scheduling their plant other than just the RV business that they’ve got so they have go to kind of marry that together to set their schedules. With that being said, I still think that we’ve got several manufacturers out there that are standing in the shadows of the chassis manufactures that if magically these chassis manufactures could wave a magic wand and say, “Chassis supply is unlimited.” I think we would have other suppliers that would come to the forefront that would say, “We’ve cut so deep and we’re trying to ramp up our production capacities and we’re just not there yet.” I think we’re going to be fighting material shortages for several months to come to be quite honest. Analyst for Greg Badishkanian – Citigroup Global Markets, Inc.: I guess switching over to your ability to meet your production, obviously there’s shortages, will that give you any ability to get some pricing especially since I don’t know if your suppliers are going to be able to do that on their end for you? Any ability there?

Well, I think it will help the discounting issue that we’ve created in this industry over the course of this recession. You look at it and you’re in a sold out position, you’ve got long lead times to get the product to your customer, you’ve got to ask yourself why would we discount. I think that part of it will help somewhat. We’re still going to have a very competitive environment in this industry until things start to stabilize because you still can’t lose sight of the fact that we’ve lost quite a few motorized manufactures, we’ve got others that are still reorganizing and restructuring and there’s still some depressed inventory out on the dealer’s lots. That’s all got to shake out before I think we can really say that we’re back to normal when it comes to discounting programs.

Your next question comes from [Eddie Sharp – Sharp Associates]. [Eddie Sharp – Sharp Associates]: Could you indicate whether the discounting and incentives have lessened versus what you had a year ago and certainly a quarter or so ago?

There definitely has been sequential improvement from the fourth quarter to the first quarter promotional at the wholesale level and at the retail level but when you compare to a year ago it is a bit higher than where we would have been a year ago however a year ago on top of the incentive side of the picture we were facing substantial losses on the repurchase side which we don’t have this year. So, if you factor all three of those then you’re looking at [inaudible]. [Eddie Sharp – Sharp Associates]: A better situation?

Yes. [Eddie Sharp – Sharp Associates]: These stat numbers, do they stack up relatively well at least for a trend versus your own registration data?

Yes, we do a check out of our data to theirs every month to assure that everything is tracking appropriately so we’re very much in tune to regards of what’s being reported. [Eddie Sharp – Sharp Associates]: It seems like that you gave those market shares of 19.3% versus 18.3% in October which is one percentage point higher, October month itself was about 2.7 percentage higher. Would you guess that the November quarter which I guess won’t be out for several weeks will be more closer to the October number than the 10 months number of market share?

Well, we definitely have seen in the last four months that our market share as a company has trended up so that’s been a positive trend. That’s our plan in regards to having that continue but I guess we’ll see what November stat surveys are when that’s reported.

That’s a very difficult one to predict. [Eddie Sharp – Sharp Associates]: I know they often have delays in certain states reporting.

Yes, they do. [Eddie Sharp – Sharp Associates]: It seems that the main thing for your volume though is due to restoring the inventory of the dealers rather than their sales because they’re down year-to-year.

Our wholesale shipments if you look at the rolling 12 month basis is still far under what retail registrations are. So, we still have a ways to go if we just want to ship at the wholesale level to meet retail demand so there’s positive upside there.

We saw the same thing back in 2004 when it took off so fast. Not only were you building to keep up with retail demand but you were building to keep up with dealers building their inventories. I think it’s a little different this time because I think dealers are looking at it and saying, “I do need to build my inventories,” but they’re still going to have to be very conscious of what that’s going to give them for turns. It still goes back to what we talked about earlier, I think once we get the wholesale rates up to where the retail rates are I think you’ll see a one-to-one ratio there. [Eddie Sharp – Sharp Associates]: What’s your opinion of Dr. Curtin’s estimate there? Very bullish for shipments is our concern, of course I don’t think he does retail but I assume he has to have some feel for that to determine but he’s got double digit increases coming forth. It seems very optimistic for me but their fantastic numbers.

I think if you look at that I think it depends on the perspective that you’re looking at. I agree with you, the percentage increase looks pretty phenomenal, it is double digits but if you look at where we started from and look at the volumes, it’s pretty small. [Eddie Sharp – Sharp Associates]: But you could say that’s the same thing for your revenues that your base is fairly small a year ago.

Absolutely. [Eddie Sharp – Sharp Associates]: So to have a 16% to 17% revenue gain is pretty damn good, he may have 20% or so for units so I didn’t quite catch all your average sales but it looks like they’re down for the most part which is really strange.

The one comment on would make on the RV shipment projects for 2010 for motor homes, the number that is currently published is still less than what retail demand is on an annualized basis so I guess that would be an important point in my view.

With no further questions in the queue, I would like to turn the call back over to Mr. Bob Olsen for closing remarks.

Again, we are pleased with the increase demand for our motor homes. We are expanding our production to meet this increased demand but we are doing so with caution until we see continued positive signs of economic recovery in the US. I continue to believe we have hit a home run with our new 2010 products as they are the right products for the marketplace today. We remain very optimistic about the long term outlook for the RV industry and as the leading motor home manufacturer in the industry we are ready and able to continue to grow with the increased demand for our products as the market recovers. I would like to thank everyone for joining Winnebago Industries’ conference call today and I look forward to talking with you again in March when we report our second quarter results for fiscal 2010. I would like to extend a happy holidays on behalf of Sarah and Sheila and all of the Winnebago Industries employees as we look forward to a new year. Thank you.