Fleetwood Enterprises Inc., the nation's second-largest producer of manufactured homes that has been mired in a deep slump since mid-1999, replaced its top two executives Monday.
Nelson Potter resigned as the Riverside company's chief executive and president to pursue other interests, the company said. He also is leaving the board of directors. Chairman Glenn Kummer is retiring but will remain on the board.
The changes follow the company's report in December of a loss for the quarter ended Oct. 28--the seventh straight quarterly deficit.
"It's about time," said Michael Crawford, an analyst at B. Riley & Co. in Los Angeles. "It's not the same company it was when they took charge. The business never performed up to expectations under their leadership."
The company, which is also the nation's largest producer of recreational vehicles, has been slashing production amid an industry slowing of sales for homes made in a factory. Fourteen of its 42 manufacturing plants have been closed.
Still, Fleetwood has been unable to show much financial improvement. "They have not turned around our profitability with the speed which we would have preferred," said Kathy Snyder, director of investor relations for the company.-
Though traditional homebuilders have been enjoying record sales, shipments of mobile homes have been plummeting, leaving dealers with bulging inventories. The prime customers for those homes, mostly blue-collar workers, have been hard hit by layoffs during the recession. Moreover, GreenPoint Financial, one of the largest mobile-home lenders in the nation, closed down in January as loan defaults soared.
"It's typical in this situation that management steps down, because the company is facing an oversupplied marketplace and short-term prospects for the industry are mediocre at best," said Craig Silvers, a real estate analyst based in Los Angeles. "It's probably time to bring in new management with fresh ideas."
Both leaders were replaced with directors who will be interim managers during a search to find long-term replacements.
David Engelman, former chief executive of UnionFed Financial Corp. and a company director since 1999, will take over as CEO. Thomas Pitcher, a retired senior partner of a law firm who has been a director since 1998, will assume Kummer's duties.
Fleetwood's shares closed at $10.45, down 3 cents on the New York Stock Exchange. The news was announced after the market closed.