Good day, ladies and gentlemen, and thank you for standing by, and welcome to the Cavco Industries, Inc.'s Fourth Quarter Fiscal Year 2012 Earnings Call and Webcast. [Operator Instructions] As a reminder, today's conference may be recorded. And now, it's my pleasure to turn the program over to Joseph Stegmayer. Please go ahead.

Thank you, Huey. Welcome, everyone. With me today is Dan Urness, our Vice President and Chief Financial Officer. And of course, we want to take advantage of the Safe Harbor rules, so we speak today under those rules. Certain comments we'll make are forward-looking statements within the meaning of a number of securities acts. Cavco disclaims any obligation to update any forward-looking statements, and investors should not place any reliance on any such forward-looking statements. Complete statement on Safe Harbor rules is included as part of Cavco's third quarter news release filed on Form 8-K yesterday. It is available on our website as well as through many other sources. I'd like to start by asking Dan to review the quarter and the financial results. And then I'll come back and make some general comments about the industry, and we'll take your questions. Dan?

Net sales for the fourth quarter of fiscal 2012 were $99.5 million, compared to $38.8 million during the same quarter last year, an increase of 156%. The quarterly results include activity for Palm Harbor Homes, compared to the prior-year actual results, which preceded the Palm Harbor transaction. The company sold 1,890 homes during the fourth fiscal quarter, up 73% compared to 1,095 homes in the prior year quarter. Consolidated net -- consolidated gross profit as a percentage of net sales this quarter was approximately 24.8% versus 13.7% in last year's comparable quarter. The percentage increase arose mainly from the nonmanufacturing businesses obtained in the Palm Harbor transaction. The retail, finance and insurance businesses have inherently higher gross margins. Quarterly SG&A costs were $20.7 million, or 20.8% of net sales, an increase of $15.3 million, compared to $5.3 million, or 13.8% of Q4 net sales last year. The percentage increase was largely from the Palm Harbor retail, finance and insurance businesses. While these operations typically generate higher gross margins, as I just mentioned, they also carry higher SG&A costs as a percentage of net sales. Other income was primarily comprised of interest from the inventory finance notes receivable. Income tax expense was offset by a $1.2 million tax benefit, creating a net tax benefit of $502,000 for the quarter. The adjustment was the result of recognizing the estimated benefits from an IRS election that allowed the company to step up the tax basis of the acquired insurance subsidiary's assets to fair value. Net income attributable to Cavco stockholders in the fourth quarter of fiscal 2012 was $1.7 million, compared to last year's fourth quarter net income of $1.6 million, with diluted earnings per share of $0.24 versus $0.23 last year. Order backlogs stood at approximately $14 million at March 31, 2012,…

Thank you, Dan. Shipment trends have definitely been up. Shipments for the period January through March, the first calendar quarter and our fourth quarter, the latest data that is available, were up 32% for the entire industry, to 12,780 homes. That's more than 3,000 homes increased from prior year period. It's also a seasonally adjusted annual rate of 57,000 units, up from 49,000 units last year. Most geographic regions are doing better in the comparable prior-year first calendar quarter, although some are still challenging such as the Mountain region and the Pacific regions. While the current industry shipment figures compare to historically low levels last year, the improvement is still welcome and we believe is sustainable. A couple of factors lead us to feel we've kind of stabilized these -- at these levels at least for the time being. Home inventories among manufactured housing distributors, that is sales centers and planned communities, are quite low. And much of the aged product has been sold, although again, in certain areas of the country, this problem still persists. Competition with site-built new home inventory, that is distressed inventory that's been around for some time since the boom days, has dwindled substantially. And with respect to repossessed homes for sale, both in manufactured homes and site constructed homes, the alternative still exists for repossessed homes. However, the product that is available in these categories, both manufactured housing and site-built, has also declined substantially. In fact, in the manufacturing housing world there's very little used, distressed or repossessed homes in most of the major markets that is aggressively priced. So we've seen that product pretty much shrink to very low levels, which is a good sign, and for those reasons, we do feel the market has substantially stabilized. Unfortunately, there are no current catalysts,…

[Operator Instructions] And our first questioner in queue is Howard Flinker with Flinker & Company.

I got a couple of accounting questions because I'm not too sharp in accounting. Is that $22 million mark-to-market, is that a pretax and post-tax item or is that just pretax?

You're referring to the $22 million bargain purchase gain that is a line item on our P&L? And yes, to answer your question, that number is nontaxable.

So it appears in both the pretax and the post-tax lines?

That's correct.

Okay. And separately, if I were to use a regular tax rate for the year in the fourth quarter, what would the taxes have been instead of a $500,000 credit in the fourth quarter and a $2.5 million debit in the year?

Sure. Well, our effective tax rate for the quarter, excluding the income tax benefit that we received, was 29%. And for the year, it was 36%. That's excluding both the bargain purchase component that you described, as well as the fourth quarter tax benefit we received.

Okay. So I can just pull up my heavy calculator and work it out myself. Those are the only questions I have. And as I said before, it's a tough environment. And considering the environment, you guys are doing a great job.

Next questioner in queue is Greg Cole with Sidoti & Company.

Can you talk a little bit about why -- or I guess what drove down the sales price sequentially? And can you give a little insight as to why I guess there's a preference shift towards single units or if there was a preference towards single units?

There is a trend in the entire industry towards greater single section shipments last year and into this year. The percent right now for the first calendar quarter is running about 50-50. And last year for the full year, it was about 46%, I believe -- let me just check -- to 54%. And so it has shifted somewhat. We think some of that is influenced by the homes in the petroleum-producing states that tend to be single section homes. But there's probably also a trend because of the economy and the push towards the interest on part of the consumers for assigning a lower price point.

Okay, all right. And then you spoke a little bit about that you thought that I guess that the level of shipments was sustainable. Did you mean the level itself or just the growth rate?

Well, we think -- we generally don't make predictions, Greg, but from an industry standpoint, right now running at, I said, a seasonally-adjusted annual rate of about 57,000, we would expect the industry to be able to do 55,000 to 60,000 shipments this year, which is still a very anemic level for us, but it's certainly up from the 50,000 shipment level last year, so it would be an improvement. Could we do more than that? Again, it depends on what the economy does. But we think that, that level is sustainable given the current conditions we see.

Okay. And I guess since we're most out the way through the first quarter, is there anything you can give us about how that's going?

Well, let's see if we can make a general comment because again, we've had a practice throughout our history that we don't really give guidance. But we do see that to say that there is interest, there seems to be more traffic at retail. I hope we will see some of that translate, that traffic, to actual sales activity, which is not always the case. People can go and look at homes but not pull the trigger to buy. But we do think some of that will translate to our sales. We have our own opportunities internally to address, I think, that can, through the year, can make some significant improvement on our profitability. So we're fairly positive, but again, it's very dicey, the economy, and it's something we obviously have no control over. But we don't see employment levels improving substantially, and that's a key for our business, Greg, if people are not employed or if they're underemployed, they're generally not going to go out and buy a new home, and that's been the industry's problem -- the whole housing industry's problem for some time. Combined that with consumer confidence levels, even those people who do have the credit or the financial capability of buying a home, they hesitate as well because they're concerned about which direction the economy is turning or going from the standpoint of selling their existing home and moving to a new home or from the standpoint of their concern about Social Security or other benefit they might have our 401(k) plans, and we see that, we've seen that for some time, and that's still the case. For the 55-plus buyer for example, who buys in age-restricted communities generally, they have hesitated to buy for those very reasons not because they don't have money, just because they have other confidence issues that they're kind of waiting to see how they pan out. So it's a long answer to your question, but we think the year should be progressively better as we push through it.

Okay. All right. And your gross margins are excellent this quarter. Can you comment a little bit as to how they increased sequentially despite the lower revenues?

Well, the margins have been moving up generally since the purchase of the Palm Harbor group. And as those entities have come online and we streamlined some operations, the margins have improved. The level we had this quarter was stronger than last quarter and the level of the quarter before that sequentially. But we don't believe that, that's necessarily a trend that we should be looking at following going forward. We think that we're going to be in that low 20 range kind of in a consistent basis until we see some meaningful improvement in shipment levels.

Okay. So it wasn't -- it's just streamlining. It's not anything in particular, that mix shift or anything like that?

As Dan mentioned, Greg, in his comments, the sequential trend is probably not a good thing to really look at anymore because with the addition of our retail business at Palm Harbor and the ancillary businesses of the financial services, they inherently generate higher gross margins, and so that's impacted our overall gross margin to certainly an extent from a comparative standpoint to prior quarters. And if that comparison now will be better year-to-year as we move forward, and you'll be able to, I think, start to compare apples-to-apples. But right now, I would not pay a lot of attention to the sequential changes. And as we get the Palm Harbor fully integrated and established, I think then you can look at ongoing gross margins, and as Dan said, they'll certainly be influenced by volume as well.

Okay. And then I have one last question. Your premiums at Standard casually have been increasing substantially over from when it was at Palm Harbor. I guess are you able to leverage the financial arm pretty substantially with your, I guess, your existing Cavco and Fleetwood units? Or can you talk a little bit about where you're going with that?

Well, we've had some continued growth in that area. They've expanded their footprint through expansion of their distribution chain for the retail sales and growth in the products that the insurance entity, both geographically and in types of products, and they'll continue to do so. But they -- as they do it, they will continue to look for opportunities to grow without increasing risk. They run a pretty conservative stable operation. That will continue to be their process going forward.

[Operator Instructions] Presenters, I am showing no additional questioners in the queue. I'd like to turn the program back over to you for any additional or closing remarks.

Thank you, Huey. Well, we thank you all for joining us today. As always, we're available for follow-up questions, and we look forward to talking to you in the next quarter. Thanks very much for your interest. Have a good day.

Thank you, gentlemen. Again, ladies and gentlemen, this does conclude today's conference. Thank you for your participation, and have a wonderful day. Attendees, you may log off at this time.