Champion Homes, Inc.

Previous wording

The Company is a leading producer of factory-built housing in the U.S. and Canada. The Company serves as a complete solutions provider across complementary and vertically integrated businesses including manufactured construction, company-owned retail locations, construction services, and transportation logistics. The Company is the largest independent publicly traded factory-built solutions provider in North America based on revenue, and markets its homes under several nationally recognized brand names including Champion Homes, Genesis Homes, Skyline Homes, Regional Homes, Athens Park Models, Dutch Housing, Atlantic Homes, Excel Homes, Homes of Merit, New Era, J. Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, and Titan Homes in the U.S. and Moduline and SRI Homes in western Canada. The Company operates 43 manufacturing facilities throughout the U.S. and 5 manufacturing facilities in western Canada that primarily construct factory-built, timber-framed manufactured and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 72 sales centers that sell manufactured homes to consumers across the U.S. while the construction services business installs and sets up factory-built homes. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles, and other products throughout the U.S. and Canada.

Current wording

The Company is a leading producer of factory-built housing in the U.S. and Canada. The Company serves as a complete solutions provider across complementary and vertically integrated businesses including manufactured construction, company-owned retail locations, construction services, and transportation logistics. The Company is the largest independent publicly traded factory-built solutions provider in North America based on revenue, and markets its homes under several nationally recognized brand names including Champion Homes, Genesis Homes, Skyline Homes, Regional Homes, Athens Park Models, Dutch Housing, Atlantic Homes, Excel Homes, Homes of Merit, New Era, J. Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, and Titan Homes in the U.S. and Moduline and SRI Homes in western Canada. The Company operates 42 manufacturing facilities throughout the U.S. and four manufacturing facilities in western Canada that primarily construct factory-built, timber-framed manufactured and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 84 sales centers that sell manufactured homes to consumers across the U.S. while the construction services business installs and sets up factory-built homes. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles, and other products throughout the U.S. and Canada.

Previous wording

The Company is focused on operational improvements to increase capacity utilization and profitability at its existing manufacturing facilities as well as measured expansion of its manufacturing and retail footprint through facility and equipment investments and acquisitions. Those investments will help improve the Company's ability to satisfy demand for affordable housing. During fiscal 2023, robust demand for housing began to slow as inflation and higher interest rates made housing less affordable. The current economic environment drives an even greater need for attainable housing solutions. As a result, the Company continues to focus on growing in strong housing markets across the U.S. and Canada, as well as expanding products and services to provide more holistic and affordable solutions to homebuyers.

Current wording

The Company is focused on operational improvements to increase capacity utilization and profitability at its existing manufacturing facilities as well as measured expansion of its manufacturing and retail footprint through facility and equipment investments and acquisitions. Those investments will help improve the Company's ability to satisfy demand for affordable housing. The current economic environment drives an even greater need for attainable housing solutions. As a result, the Company continues to focus on growing in strong housing markets across the U.S. and Canada, as well as expanding products and services to provide more holistic and affordable solutions to homebuyers.

Previous wording

In October 2023, the Company acquired Regional Homes ("Regional"), which, at the time of the acquisition, operated three manufacturing facilities in Alabama and 43 retail sales centers across the Southeast U.S. Regional's strong presence in large HUD markets in the Southeast U.S. expanded our captive retail and manufacturing distribution in the region. In July 2022, the Company acquired 12 Factory Expo retail sales centers from Alta Cima Corporation, which expanded the internal retail network across a broader portion of the U.S. In May 2022, the Company acquired Manis Custom Builders, Inc. ("Manis") in order to expand its manufacturing footprint and further streamline its product offering in the Carolinas.

Current wording

In May 2025, the Company acquired Iseman Homes which operated 10 retail sales centers across the North Central U.S. This acquisition enhances the Company's ability to strengthen distribution from its nearby manufacturing facilities, furthering the Company’s commitment to integrated growth. In October 2023, the Company acquired Regional Homes, which operated three manufacturing facilities in Alabama and 44 retail sales centers across the Southeast U.S. Regional Homes' strong presence in large HUD markets expanded our captive retail and manufacturing distribution in that region.

Previous wording

In addition to those acquisitions, the Company is also focused on enhancing its U.S. manufacturing production capacity through various plant start-ups in strategic locations. As a result, the Company began production in previously idled or acquired facilities in Decatur, Indiana and Bartow, Florida in fiscal 2024 and a facility in Pembroke, North Carolina in the fourth quarter of fiscal 2023. The Company owns six idle manufacturing facilities that could be used for further manufacturing capacity expansion in future periods.

Current wording

In addition to those acquisitions, the Company is also focused on enhancing its U.S. manufacturing production capacity, as well as redeployment of capital and resources through strategic actions at specific plants. During the first half of fiscal 2026, the Company idled production at the Bartow, Florida manufacturing plant and ceased operations at the Kelowna, British Columbia manufacturing plant. The Company believes those actions will ultimately lead to greater operating efficiency and profitability. In addition, the Company sold a previously idled manufacturing facility during the second quarter of fiscal 2026. The Company continues to own six idle manufacturing facilities that could be used for further manufacturing capacity expansion in future periods.

Previous wording

During fiscal 2024, the Company made an equity investment in ECN. The investment, in part, facilitated the creation of a captive finance company in partnership with Triad. The captive finance company, Champion Financing, provides factory-built home floor plan and consumer loans to retailers and homebuyers. The Company believes this offering will provide customers needed financing solutions and improve the Company's market share.

Current wording

During fiscal 2024, the Company made an equity investment in ECN Capital Corporation ("ECN"). The investment, in part, facilitated the creation of a captive finance company in partnership with Triad Financing Services, Inc. ("Triad"), a subsidiary of ECN. The captive finance company, Champion Financing, through Triad, provides factory-built home floor plan and consumer loans to manufactured home retailers and homebuyers. The Company believes this offering will provide customers needed financing solutions and improve the Company's market share. On November 13, 2025, ECN entered into a definitive arrangement to be acquired by a private investor group for CAD $3.10 per share, plus any accrued but unpaid dividends. The transaction closed on April 24, 2026, which resulted in the liquidation of the Company's investment in ECN common and preferred shares in the first quarter of fiscal 2027. The liquidation of the Company's investment in ECN common and preferred shares will not impact the future operations of Champion Financing.

Previous wording

For fiscal 2025, approximately 88% of the Company’s U.S. manufacturing sales were generated from the manufacture of homes that comply with the Federal HUD code construction standard in the U.S. According to data reported by MHI, HUD-code industry home shipments were 105,206, 92,288, and 104,374 units during fiscal 2025, 2024, and 2023, respectively. Based on industry data, the Company’s U.S. wholesale market share of HUD code homes sold was 22.0%, 19.9%, and 20.4% in fiscal 2025, 2024, and 2023, respectively. Annual industry shipments have generally increased each year since calendar year 2009 when only 50,000 HUD-coded manufactured homes were shipped, the lowest level since the industry began recording statistics in 1959. While shipments of HUD-coded manufactured homes have improved modestly in recent years, current manufactured housing shipments are still at lower levels than the long-term historical average of over 200,000 units per year. Manufactured home sales represent approximately 9.5% of all U.S. single family home starts.

Current wording

For fiscal 2026, approximately 87% of the Company’s U.S. manufacturing sales were generated from the manufacture of homes that comply with the Federal HUD code construction standard in the U.S. According to data reported by MHI, HUD-code industry home shipments were 100,380, 105,206, and 92,288 units during fiscal 2026, 2025, and 2024, respectively. Based on industry data, the Company’s U.S. wholesale market share of HUD code homes sold was 22.5%, 22.0%, and 19.9% in fiscal 2026, 2025, and 2024, respectively. Annual industry shipments have generally increased each year since calendar year 2009 when only 50,000 HUD-coded manufactured homes were shipped, the lowest level since the industry began recording statistics in 1959. While shipments of HUD-coded manufactured homes have improved modestly in recent years, current manufactured housing shipments are still at lower levels than the long-term historical average of over 200,000 units per year. Manufactured home sales represent approximately 10% of all U.S. single family home starts.

Previous wording

Net sales for fiscal 2025 were $2.5 billion, an increase of $458.6 million, or 22.7%, over fiscal 2024. The following is a summary of the change by operating segment.

Current wording

Net sales for fiscal 2026 were $2.7 billion, an increase of $180.2 million, or 7.3%, over fiscal 2025. The following is a summary of the change by operating segment.

Previous wording

The Canadian Factory-built Housing segment net sales decreased by $14.9 million, or 13.7% in fiscal 2025 compared to the prior year, primarily due to a 11.9% decrease in homes sold. The decrease in homes sold is due to slowing demand in the Canadian housing market. Net sales for the Canadian segment were also unfavorably impacted by approximately $3.1 million as the Canadian dollar weakened relative to the U.S. dollar during fiscal 2025 as compared to the prior year.

Current wording

The Canadian Factory-built Housing segment net sales increased by $16.8 million, or 17.9% in fiscal 2026 compared to the prior year, primarily due to an increase of 15.2% in homes sold and an increase in average selling price. The increase in homes sold is due to higher demand in certain markets. Net sales for the Canadian segment were also favorably impacted by approximately $0.6 million as the Canadian dollar weakened relative to the U.S. dollar during fiscal 2026 as compared to the prior year.

Previous wording

Net sales for Corporate/Other includes the Company’s transportation business, financing activities and the elimination of intersegment sales. During fiscal 2025, net sales for the segment increased by $1.1 million, or 3.7%, compared to fiscal 2024. The decrease was primarily attributable to a decrease in recreational vehicle shipments by our transportation operations, offset in part by net sales from the initiation of the Champion Financing operations in fiscal 2025.

Current wording

Net sales for Corporate/Other includes the Company’s transportation business, financing activities and the elimination of intersegment sales. During fiscal 2026, net sales for the segment increased by $5.5 million, or 17.4%, compared to fiscal 2025, primarily due to increased operating activities in Champion Financing, partially offset by a decrease in recreational vehicle shipments.

Previous wording

Gross profit as a percent of sales during fiscal 2025 was 26.7% compared to 24.0% during fiscal 2024. The following is a summary of the change by operating segment.

Current wording

Gross profit as a percent of sales during fiscal 2026 was 26.4% compared to 26.7% during fiscal 2025. The following is a summary of the change by operating segment.

Previous wording

Gross profit for the U.S. Factory-built Housing segment increased by $177.2 million, or 40.2%, during fiscal 2025 compared to the prior year. As a percent of net sales, gross profit was 26.2% for fiscal 2025 compared to 23.3% in the prior fiscal year. The increase in gross profit was driven by higher unit volume due to higher customer demand and the addition of Regional Homes for the entirety of fiscal 2025. The increase in gross profit as a percent of segment net sales is driven, in part, by a greater percentage of homes sold through our company-owned retail sales centers and lower manufacturing input costs. The increase in gross profit and gross profit percent in fiscal 2025 is also positively impacted by the $34.5 million charge in fiscal 2024 for estimated costs to remediate water intrusion in certain homes built in one of our manufacturing facilities from fiscal 2016 through fiscal 2021.

Current wording

Gross profit for the U.S. Factory-built Housing segment increased by $24.3 million, or 3.9%, during fiscal 2026 compared to the prior year. As a percent of net sales, gross profit was 25.5% for fiscal 2026 compared to 26.2% in the prior fiscal year. The increase in gross profit was primarily driven by higher revenue as discussed above. The decrease in gross profit as a percent of segment net sales was driven by higher material and labor costs and the $8.4 million charge in the fourth quarter of fiscal 2026 to adjust our estimated costs to remediate water intrusion in certain homes built in one of our manufacturing facilities, partially offset by $3.5 million of reimbursements received from the material distributor for the Company's remediation costs incurred.

Previous wording

Gross profit for the Canadian Factory-built Housing segment decreased by $6.7 million, or 21.8%, during fiscal 2025 compared to the prior year. The decrease in gross profit was due to lower sales volumes caused by declining consumer demand. Gross profit decreased to 25.3% as a percent of segment net sales from 27.9% in the prior year due to decreased leverage of fixed manufacturing costs and production inefficiency caused by lower production rates.

Current wording

Gross profit for the Canadian Factory-built Housing segment increased by $8.3 million, or 34.7%, during fiscal 2026 compared to the prior year. The increase in gross profit was due to higher sales volumes. Gross profit increased to 28.9% as a percent of segment net sales from 25.3% in the prior year due to increased leverage of fixed manufacturing costs.

Previous wording

Gross profit for the Corporate/Other segment increased by $7.7 million, or 51.0%, during fiscal 2025 compared to the same period in the prior year. Gross profit increased as a result of the inclusion of Champion Financing.

Current wording

Gross profit for the Corporate/Other segment increased by $7.7 million, or 33.7%, during fiscal 2026 compared to the same period in the prior year. Gross profit increased as a result of increased operating activity of Champion Financing.

Previous wording

SG&A expenses were $427.0 million during fiscal 2025, an increase of $116.4 million compared to the prior year. The following is a summary of the change by operating segment.

Current wording

SG&A expenses were $452.6 million during fiscal 2026, an increase of $25.6 million compared to the prior year. The following is a summary of the change by operating segment.

Previous wording

SG&A expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. SG&A expenses for Corporate/Other increased by $21.4 million, or 31.7%, during fiscal 2025 as compared to the prior year due primarily to higher incentive compensation as a result of achievement of performance metrics in fiscal 2025 compared to fiscal 2024, and investments made in people and information systems to support future growth.

Current wording

SG&A expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. SG&A expenses for Corporate/Other increased by $2.6 million, or 2.9%, during fiscal 2026 as compared to the prior year due primarily to higher stock compensation and professional fees, partially offset by lower IT costs.

Previous wording

Interest (income), net was $17.0 million during fiscal 2025, compared to $28.3 million in the prior year. The change was primarily due to lower interest income from lower average invested cash balances and higher interest expense from higher average floor plan payables and long-term debt balances assumed in the acquisition of Regional Homes.

Current wording

Interest income, net was $16.4 million during fiscal 2026, compared to $17.0 million in the prior year. The change was primarily due to lower interest rates on invested cash balances and average floor plan payables.

Previous wording

The following table summarizes other (income) expense, net for fiscal 2025 and 2024:

Current wording

The following table summarizes other income for fiscal 2026 and 2025:

Previous wording

Other income of $3.4 million for fiscal 2025 represents dividend income of $2.4 million from the investment in ECN Preferred shares and $1.0 million of insurance proceeds for partial settlement of certain Champion Home Builders’ pre-bankruptcy workers' compensation claims. Other expense of $2.6 million for fiscal 2024 represents transaction costs incurred for the acquisition of Regional Homes of $3.3 million, partially offset by dividend income of $0.6 million from the investment in ECN Preferred Shares.

Current wording

Other income of $2.4 million for fiscal 2026 represents dividend income from the investment in ECN Preferred shares. Other income of $3.4 million for fiscal 2025 represents dividend income from the investment in ECN Preferred shares and $1.0 million of insurance proceeds for partial settlement of certain Champion Home Builders’ pre-bankruptcy workers' compensation claims.

Previous wording

Income tax expense during fiscal 2025 was $53.7 million, representing an effective tax rate of 20.9%, compared to income tax expense of $47.1 million, representing an effective tax rate of 23.5%, in fiscal 2024. The rate change from fiscal 2024 to fiscal 2025 is primarily due to an increase in tax credits in fiscal 2025.

Current wording

Income tax expense during fiscal 2026 was $56.8 million, representing an effective tax rate of 21.0%, compared to income tax expense of $53.7 million, representing an effective tax rate of 20.9%, in fiscal 2025.

Previous wording

The following table summarizes equity in net loss of affiliates for fiscal 2025 and 2024:

Current wording

The following table summarizes equity in net (income) loss of affiliates for fiscal 2026 and 2025:

Previous wording

The Company's investment in ECN is accounted for under the equity method and the Company’s share of the earnings or losses of ECN are recorded on a three-month lag. Equity in net loss of affiliates of $2.0 million in fiscal 2025 represents net losses on the equity method investment in ECN of $0.4 million and net losses from other unconsolidated affiliates of $1.6 million. Equity in net loss of affiliates of $7.0 million for fiscal 2024 represented a loss on the equity method investment in ECN.

Current wording

The Company's investment in ECN is accounted for under the equity method and the Company’s share of the earnings or losses of ECN are recorded on a three-month lag. Equity in net income of affiliates of $0.4 million in fiscal 2026 represents net income on the equity method investment in ECN of $1.2 million and net losses from other unconsolidated affiliates of $0.8 million. Equity in net loss of affiliates of $2.0 million for fiscal 2025 represented net losses on the equity method investment in ECN of $0.4 million and net losses from other unconsolidated affiliates of $1.6 million.

Previous wording

Adjusted EBITDA for fiscal 2025 was $285.1 million, an increase of $39.8 million from fiscal 2024. The increase is a result of higher sales volumes and gross profit, partially offset by higher SG&A expenses, primarily driven by the inclusion of Regional Homes for the entirety of fiscal 2025 compared to 5.5 months of operations in the prior year period. See the definition of Adjusted EBITDA under “Non-GAAP Financial Measures” below for additional information regarding the definition and use of this metric in evaluating the Company’s results.

Current wording

Adjusted EBITDA for fiscal 2026 was $308.2 million, an increase of $23.2 million from fiscal 2025. The increase is a result of higher sales volumes and gross profit, partially offset by higher SG&A expenses. See the definition of Adjusted EBITDA under “Non-GAAP Financial Measures” below for additional information regarding the definition and use of this metric in evaluating the Company’s results.

Previous wording

Although orders from customers can be cancelled at any time without penalty, and unfilled orders are not necessarily an indication of future business, the Company’s unfilled U.S. and Canadian manufacturing orders at March 29, 2025 totaled $343.4 million compared to $315.8 million at March 30, 2024. The increase in backlog was primarily driven by higher net orders.

Current wording

Although orders from customers can be cancelled at any time without penalty, and unfilled orders are not necessarily an indication of future business, the Company’s unfilled U.S. and Canadian manufacturing orders at March 28, 2026 totaled $316.0 million compared to $343.4 million at March 29, 2025. The decrease in backlog is a function of production rates exceeding order rates during fiscal 2026 compared to fiscal 2025.

Previous wording

The Company’s primary sources of liquidity are cash flows from operations and existing cash balances. Cash balances and cash flows from operations for the next year are expected to be adequate to cover working capital requirements, capital expenditures, and strategic initiatives and investments. The Company does not have any scheduled long-term debt maturities in the next twelve months. The Company has an Amended and Restated Credit Agreement which provides for a $200.0 million revolving credit facility, including a $45.0 million letter of credit sub-facility ("Amended Credit Agreement"). At March 29, 2025, there were no borrowings under the Amended Credit Agreement and letters of credit issued under the Credit Agreement totaled $31.5 million. Total available borrowings under the Credit Agreement as of March 30, 2024 were $168.5 million. The Company’s revolving credit facility includes (i) a maximum consolidated total net leverage ratio of 3.25 to 1.00, subject to an upward adjustment upon the consummation of a material acquisition, and (ii) a minimum interest coverage ratio of 3.00 to 1.00. The Company anticipates compliance with its debt covenants and projects its level of cash availability to be in excess of cash needed to operate the business for the next year and beyond.

Current wording

The Company’s primary sources of liquidity are cash flows from operations and existing cash balances. Cash balances and cash flows from operations for the next year are expected to be adequate to cover working capital requirements, capital expenditures, maturities of long-term debt, and strategic initiatives and investments. The Company's Second Amended and Restated Credit Agreement provides for a $200.0 million revolving credit facility, including a $45.0 million letter of credit sub-facility ("Second Amended Credit Agreement"). At March 28, 2026, there were no borrowings under the Second Amended Credit Agreement and letters of credit issued under the Second Amended Credit Agreement totaled $27.5 million. Total available borrowings under the Second Amended Credit Agreement as of March 29, 2025 were $172.5 million. The Company’s revolving credit facility includes (i) a maximum consolidated total net leverage ratio of 3.25 to 1.00, subject to an upward adjustment upon the consummation of a material acquisition, and (ii) a minimum interest coverage ratio of 3.00 to 1.00. The Company anticipates compliance with its debt covenants and projects its level of cash availability to be in excess of cash needed to operate the business for the next year and beyond. In the event operating cash flow and existing cash balances were deemed inadequate to support the Company’s liquidity needs, and one or more capital resources were to become unavailable, the Company would revise its operating strategies.

Previous wording

Cash provided by operating activities was $240.9 million in fiscal 2025 compared to $222.7 million in fiscal 2024. The increase was driven by higher net income, partially offset by less favorable changes in working capital items primarily a result of the increase in finished goods inventories at the company-owed retail sales centers.

Current wording

Cash provided by operating activities was $303.9 million in fiscal 2026 compared to $240.9 million in fiscal 2025. The increase was driven by changes in deferred taxes and favorable changes in working capital items primarily a result of the decrease in finished goods inventories at the company-owned retail sales centers.

Previous wording

Cash used in investing activities was $46.2 million in fiscal 2025 versus $485.7 million in fiscal 2024. The decrease in cash used for investing activities was related to the Company's acquisition of Regional Homes, an investment in floor plan loans, and the purchase of ECN common and preferred stock in fiscal 2024 which did not reoccur in fiscal 2025.

Current wording

Cash used in investing activities was $57.2 million in fiscal 2026 versus $46.2 million in fiscal 2025. The increase in cash used in investing activities was related to the acquisition of Iseman Homes in the first quarter of fiscal 2026, offset in part by a reduction in expenditures for property, plant and equipment.

Previous wording

Cash used in financing activities was $73.0 million in fiscal 2025 versus $10.9 million provided by financing activities in fiscal 2024. The increase in fiscal 2025 is a result of common stock repurchases of $80.0 million. Fiscal 2025 was the first year of the repurchase activity.

Current wording

Cash used in financing activities was $222.2 million in fiscal 2026 versus $73.0 million in fiscal 2025. The increase in cash used in financing activities was primarily a result of an increase in repurchases of the Company's stock in fiscal 2026 and reduction of floor plan payables.

Previous wording

The Amended Credit Agreement matures in July 2026 and has no scheduled amortization. The interest rate on borrowings under the Amended Credit Agreement is based on the Secured Overnight Financing Rate ("SOFR") plus a benchmark Replacement Rate Adjustment ("Replacement Rate"), plus an interest rate spread. The interest rate spread adjusts based on the consolidated total net leverage of the Company from a high of 1.875% when the consolidated total net leverage ratio is equal to or greater than 2.25:1.00, to a low of 1.125% when the consolidated total net leverage is below 0.50:1.00. Alternatively for same day borrowings, the interest rate is based on an Alternative Base Rate ("ABR") plus an interest rate spread that ranges from a high of 0.875% to a low of 0.125% based on the consolidated total net leverage ratio. In addition, the Company is obligated to pay an unused line fee ranging between 0.15% and 0.30% depending on the consolidated total net leverage ratio, in respect of unused commitments under the Amended Credit Agreement.

Current wording

The Second Amended Credit Agreement matures in July 2030 and has no scheduled amortization. The interest rate on borrowings under the Second Amended Credit Agreement is based on the Secured Overnight Financing Rate ("SOFR") or an Alternative Base Rate ("ABR") plus an interest rate spread. The interest rate spread adjusts based on the consolidated total net leverage of the Company. The interest rate ranges from a high of SOFR plus 1.875% or the ABR plus 0.875% (when the consolidated total net leverage ratio is equal to or greater than 2.25 to 1.00), to a low of SOFR plus 1.125% or the ABR plus 0.125% (when the consolidated total net leverage ratio is less than 0.50 to 1.00). In addition, the Company is obligated to pay an unused line fee ranging between 0.15% and 0.30% depending on the consolidated total net leverage ratio, in respect of unused commitments under the Amended Credit Agreement.

Previous wording

The Company has a letter of credit sub-facility under the Amended Credit Agreement. At March 29, 2025, letters of credit issued under the sub-facility totaled $31.5 million.

Current wording

The Company has a letter of credit sub-facility under the Second Amended Credit Agreement. At March 28, 2026, letters of credit issued under the sub-facility totaled $27.5 million.

Previous wording

At March 29, 2025, the Company had outstanding borrowings on floor plan financing arrangements of $106.1 million. The Company’s retail operations utilize floor plan financing to fund the acquisition of manufactured homes for display or resale. The arrangements provide for borrowings up to $253.0 million. Floor plan payables are secured by the homes acquired and are required to be repaid when the Company sells the financed home to a customer.

Current wording

At March 28, 2026, the Company had outstanding borrowings on floor plan financing arrangements of $94.6 million. The Company’s retail operations utilize floor plan financing to fund the acquisition of manufactured homes for display or resale. The arrangements provide for borrowings up to $308.0 million. Floor plan payables are secured by the homes acquired and are required to be repaid when the Company sells the financed home to a customer.

Previous wording

The Company has contingent liabilities and obligations at March 29, 2025, including surety bonds and letters of credit totaling $17.5 million and $31.5 million, respectively. Additionally, the Company is contingently obligated under repurchase agreements with certain lending institutions that provide floor plan financing to independent retailers. The contingent repurchase obligation as of March 29, 2025 is approximately $241.9 million, without reduction for the resale value of the homes collateralizing the potential repurchases. The Company has the ability to resell the repurchased collateral to other retailers, and losses incurred on repurchased homes have been insignificant in recent periods. The reserve for estimated losses under repurchase agreements was $1.6 million at March 29, 2025. See “Critical Accounting Polices and Estimates – Reserve for Repurchase Commitments” below.

Current wording

The Company has contingent liabilities and obligations at March 28, 2026, including surety bonds and letters of credit totaling $14.8 million and $27.5 million, respectively. Additionally, the Company is contingently obligated under repurchase agreements with certain lending institutions that provide floor plan financing to independent retailers. The contingent repurchase obligation as of March 28, 2026 is approximately $233.7 million, without reduction for the resale value of the homes collateralizing the potential repurchases. The Company has the ability to resell the repurchased collateral to other retailers, and losses incurred on repurchased homes have been insignificant in recent periods. The reserve for estimated losses under repurchase agreements was $1.7 million at March 28, 2026. See “Critical Accounting Polices and Estimates – Reserve for Repurchase Commitments” below.

Previous wording

The Company has received consumer complaints for damages related to water intrusion in homes built in one of its manufacturing facilities prior to fiscal 2022. The Company has investigated, and believes, the cause of the damage is the result of materials that did not perform in accordance with the manufacturer's contractual obligations. The Company has identified that certain homes constructed over that period that may be affected. Based on the results of ongoing investigation and repair efforts, the Company has developed a remediation plan under Subpart I of the HUD code, which was approved in fiscal 2025. The plan calls for inspection and repair of affected homes if there is evidence of damage, or procedures to mitigate the opportunity for future damage. As a result of the proposal, the Company recorded charges to execute the remediation plan of $34.5 million during the fourth quarter of fiscal 2024. The Company estimated the charges by establishing a range of total expected costs determined by an actuary using a Monte Carlo simulation. The analysis, which was completed at the end of the fourth quarter of fiscal 2024, resulted in a range of losses between $34.5 million and $85.0 million. The Company was not able to determine a value in the range that was more likely than any other value, and as prescribed by U.S. GAAP, recorded the charge for remediation based on the low end of the range of potential losses. The Company reassessed the total expected costs in the fourth quarter of fiscal 2025 which resulted in no change to the low end of the range of potential losses and reduction in the high end of the range of potential losses to $77.5 million. The Company will monitor the results of the inspection and repair activities, including actual repair costs, and may revise the amount of the estimated liability, which could result in an increase or decrease in the estimated liability in future periods. The liability, net of $0.4 million of remediation payments made during fiscal 2025, is included in other current liabilities in the accompanying Consolidated Balance Sheets.

Current wording

The Company has received consumer complaints for damages related to water intrusion in homes built in one of its manufacturing facilities prior to fiscal 2022. The Company has investigated, and believes, the cause of the damage is the result of materials that did not perform in accordance with the manufacturer's contractual obligations. The Company has identified that certain homes constructed over that period that may be affected. Based on the results of ongoing investigation and repair efforts, the Company developed a remediation plan under Subpart I of the HUD code, which was approved in fiscal 2025. The plan called for inspection and repair of affected homes if there is evidence of damage, or procedures to mitigate the opportunity for future damage. As a result of the proposal, the Company recorded a charge of $34.5 million during the fourth quarter of fiscal 2024 related to the estimated costs of the planned remediation efforts. The Company estimated the charges by establishing a range of total expected costs determined by an actuary using a Monte Carlo simulation. The analysis, which was completed at the end of the fourth quarter of fiscal 2024, resulted in a range of losses between $34.5 million and $85.0 million. The Company was not able to determine a value in the range that was more likely than any other value, and as prescribed by U.S. GAAP, recorded the charge for remediation based on the low end of the range of potential losses. During fiscal 2026, the Company reassessed the total expected remaining estimated costs of the planned remediation efforts and determined, through completed inspection, repair and settlement efforts, that there was sufficient experience such that recording to the low end of a range of losses was no longer appropriate. The actuarial analysis completed in the fourth quarter of fiscal 2026 resulted in a charge of $8.5 million to increase the remaining estimated liability to $35.6 million at March 28, 2026. The Company will continue to monitor the population of affected homes and the results of the inspection and repair activities, including actual repair costs on the affected homes and the number of affected homes to be repaired, and may revise the amount of the estimated liability, which could result in an increase or decrease in the estimated liability in future periods.

Previous wording

The Company defines Adjusted Earnings Before Interest Taxes and Depreciation and Amortization (“Adjusted EBITDA”) as net income or loss attributable to Champion Homes, Inc. plus expenses or minus income for: (a) the provision for income taxes; (b) interest income or expense, net; (c) depreciation and amortization; (d) gain or loss from discontinued operations; (e) non-cash restructuring charges and impairment of assets; (f) equity in net earnings or losses of ECN; (g) charges related to the remediation of the water intrusion product liability claims; and (h) other non-operating income or expense including but not limited to those costs for the acquisition and integration or disposition of businesses, including the change in fair value of contingent consideration, and idle facilities. Adjusted EBITDA is not a measure of earnings calculated in accordance with U.S. GAAP and should not be considered an alternative to, or more meaningful than, net income or loss prepared on a U.S. GAAP basis. Adjusted EBITDA does not purport to represent cash flow provided by, or used in, operating activities as defined by U.S. GAAP, which is presented in the Statement of Cash Flows. In addition, Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies.

Current wording

The Company defines Adjusted Earnings Before Interest Taxes and Depreciation and Amortization (“Adjusted EBITDA”) as net income or loss attributable to Champion Homes, Inc. plus expenses or minus income for: (a) the provision for income taxes; (b) interest income or expense, net; (c) depreciation and amortization; (d) gain or loss from discontinued operations; (e) non-cash restructuring charges and impairment of assets; (f) equity in net earnings or losses of ECN; (g) charges related to the remediation of the water intrusion product liability claims and reimbursement of water intrusion costs; and (h) other non-operating income or expense including but not limited to those costs for the acquisition and integration or disposition of businesses, including the change in fair value of contingent consideration, and idle facilities. Adjusted EBITDA is not a measure of earnings calculated in accordance with U.S. GAAP and should not be considered an alternative to, or more meaningful than, net income or loss prepared on a U.S. GAAP basis. Adjusted EBITDA does not purport to represent cash flow provided by, or used in, operating activities as defined by U.S. GAAP, which is presented in the Statement of Cash Flows. In addition, Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies.

Previous wording

The Company is self-insured for a significant portion of its general insurance, product liability, workers’ compensation, auto, health, and property insurance. Insurance coverage is maintained for catastrophic exposures and those risks required to be insured by law. The Company is currently liable for the first $250,000 of incurred losses for each workers’ compensation incident, $150,000 for each auto liability claim and is responsible for losses up to the first $500,000 per occurrence for general, product liability, and property insurance. Generally catastrophic losses are insured up to $80 million. The Company establishes reserves for reported and unreported losses and insurance company reimbursements under these programs using an actuarial determined value which takes into consideration prior claim experience, estimates of losses for known occurrences and the respective volume of business activity for a given period. The health plan is currently subject to a stop-loss limit of $800,000 per occurrence. Estimated self-insurance costs are accrued for all expected future expenditures for reported and unreported claims based on historical experience.

Current wording

The Company is self-insured for a significant portion of its general insurance, product liability, workers’ compensation, auto, health, and property insurance. Insurance coverage is maintained for catastrophic exposures and those risks required to be insured by law. The Company is currently liable for the first $500,000 of incurred losses for each workers’ compensation incident, $150,000 for each auto liability claim and is responsible for losses up to the first $500,000 per occurrence for general, product liability, and property insurance. Generally catastrophic losses are insured up to $80 million. The Company establishes reserves for reported and unreported losses and insurance company reimbursements under these programs using an actuarial determined value which takes into consideration prior claim experience, estimates of losses for known occurrences and the respective volume of business activity for a given period. Estimated self-insurance costs are accrued for all expected future expenditures for reported and unreported claims based on historical experience.

Previous wording

In fiscal 2025, the Company performed qualitative assessments of its reporting units. The annual assessment was completed on of the first day of fiscal March. The assessments indicated that it was more likely than not that the fair value of each of the reporting units exceeded its respective carrying value. The Company does not believe that any reporting units are at risk for impairment.

Current wording

In fiscal 2026, the Company performed qualitative assessments of its reporting units. The annual assessment was completed on the first day of fiscal March. The assessments indicated that it was more likely than not that the fair value of each of the reporting units exceeded its respective carrying value. The Company does not believe that any reporting units are at risk for impairment.

Previous wording

As is customary in the factory-built housing industry, a significant portion of the home sales to independent retailers are made pursuant to repurchase agreements with lending institutions that provide wholesale floor plan financing to the retailers. Certain homes sold pursuant to repurchase agreements are subject to repurchase, generally up to 24 months after the sale of the home to the retailer. Certain other homes sold pursuant to repurchase agreements are subject to repurchase until the home is sold by the retailer. For those homes with an unlimited repurchase period, the Company’s risk of loss upon repurchase declines due to required monthly principal payments by the retailer. After 18 to 36 months from the date of the Company’s sale of the home, the risk of loss on these homes is low, and by the 46th month, most programs require that the home be paid in full, at which time the Company no longer has risk of loss. Pursuant to these agreements, during the repurchase period, generally upon default by the retailer and repossession by the financial institution, the Company is obligated to repurchase the homes from the floor plan lenders. The contingent repurchase obligation as of March 29, 2025 was estimated to be approximately $241.9 million, without reduction for the resale value of the homes. Losses under repurchase obligations represent the difference between the repurchase price and net proceeds from the resale of the homes, less accrued rebates, which will not be paid. Losses incurred on homes repurchased have been insignificant in recent periods. The reserve for estimated losses under repurchase agreements was $1.6 million at March 29, 2025.

Current wording

As is customary in the factory-built housing industry, a significant portion of the home sales to independent retailers are made pursuant to repurchase agreements with lending institutions that provide wholesale floor plan financing to the retailers. Certain homes sold pursuant to repurchase agreements are subject to repurchase, generally up to 24 months after the sale of the home to the retailer. Certain other homes sold pursuant to repurchase agreements are subject to repurchase until the home is sold by the retailer. For those homes with an unlimited repurchase period, the Company’s risk of loss upon repurchase declines due to required monthly principal payments by the retailer. After 18 to 36 months from the date of the Company’s sale of the home, the risk of loss on these homes is low, and by the 46th month, most programs require that the home be paid in full, at which time the Company no longer has risk of loss. Pursuant to these agreements, during the repurchase period, generally upon default by the retailer and repossession by the financial institution, the Company is obligated to repurchase the homes from the floor plan lenders. The contingent repurchase obligation as of March 28, 2026 was estimated to be approximately $233.7 million, without reduction for the resale value of the homes. Losses under repurchase obligations represent the difference between the repurchase price and net proceeds from the resale of the homes, less accrued rebates, which will not be paid. Losses incurred on homes repurchased have been insignificant in recent periods. The reserve for estimated losses under repurchase agreements was $1.7 million at March 28, 2026.