LCI Industries Reports Third Quarter Financial Results
Strong operating performance and cash flow generation in challenging environment
Third Quarter 2024 Highlights
-
Net sales of
$915 million in the third quarter, down 5% year-over-year -
Net income of
$36 million , or$1.39 per diluted share, in the third quarter, up 38% from the third quarter of 2023 -
EBITDA of
$85 million in the third quarter, or 9.3% of net sales, up 8% year-over-year - Operating profit margin of 5.9% in the third quarter, up from 4.8% in the third quarter of 2023
-
Quarterly dividend of
$1.05 per share paid, totaling$27 million in the third quarter -
Cash flows provided by operations of
$402 million for the LTM period endedSeptember 30, 2024 -
Strong liquidity position with
$161 million of cash and cash equivalents and$383 million of availability on revolving credit facility atSeptember 30, 2024
"Despite a challenging RV and Marine industry backdrop, we delivered a strong quarter with continued market share expansion, increased operating margins, and robust operating cash flow which has reached
“I’d like to thank our team members for their dedication to driving our business forward this quarter while working through a challenging environment,” commented
Third Quarter 2024 Results
Consolidated net sales for the third quarter of 2024 were
The decrease in year-over-year net sales for the third quarter of 2024 was primarily driven by lower sales to North American marine and utility trailer OEMs and declines in wholesale shipments of motorhome RV units, partially offset by increased North American RV wholesale shipments of travel trailers and fifth-wheels and market share gains in the automotive aftermarket.
OEM Segment - Third Quarter Performance
OEM net sales for the third quarter of 2024 were
Operating profit of the OEM Segment was
Aftermarket Segment - Third Quarter Performance
Aftermarket net sales for the third quarter of 2024 were
“Our automotive aftermarket business has continued to outperform, delivering a 7.3% increase in sales to help offset softness in the RV and Marine aftermarkets. We’re also capitalizing on the growing demand for replacement and repair parts by providing innovative content coupled with high quality service, setting us apart for both dealers and consumers,” commented
Income Taxes
The Company's effective tax rate was 24.8% for the quarter ended
Balance Sheet and Other Items
At
The Company's outstanding long-term indebtedness, including current maturities, was
Conference Call & Webcast
A replay of the conference call will be available for two weeks by dialing (866) 813-9403 for participants in the
About
Forward-Looking Statements
This press release contains certain "forward-looking statements" with respect to our financial condition, results of operations, profitability, margins, business strategies, operating efficiencies or synergies, competitive position, growth opportunities, acquisitions, plans and objectives of management, markets for the Company's common stock, the impact of legal proceedings, and other matters. Statements in this press release that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, and involve a number of risks and uncertainties.
Forward-looking statements, including, without limitation, those relating to production levels, future business prospects, net sales, expenses and income (loss), capital expenditures, tax rate, cash flow, financial condition, liquidity, covenant compliance, retail and wholesale demand, integration of acquisitions, R&D investments, commodity prices, addressable markets, and industry trends, whenever they occur in this press release are necessarily estimates reflecting the best judgment of the Company's senior management at the time such statements were made. There are a number of factors, many of which are beyond the Company's control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors include, in addition to other matters described in this press release, the impacts of future pandemics, geopolitical tensions, armed conflicts, or natural disasters on the global economy and on the Company's customers, suppliers, employees, business and cash flows, pricing pressures due to domestic and foreign competition, costs and availability of, and tariffs on, raw materials (particularly steel and aluminum) and other components, seasonality and cyclicality in the industries to which we sell our products, availability of credit for financing the retail and wholesale purchase of products for which we sell our components, inventory levels of retail dealers and manufacturers, availability of transportation for products for which we sell our components, the financial condition of our customers, the financial condition of retail dealers of products for which we sell our components, retention and concentration of significant customers, the costs, pace of and successful integration of acquisitions and other growth initiatives, availability and costs of production facilities and labor, team member benefits, team member retention, realization and impact of expansion plans, efficiency improvements and cost reductions, the disruption of business resulting from natural disasters or other unforeseen events, the successful entry into new markets, the costs of compliance with environmental laws, laws of foreign jurisdictions in which we operate, other operational and financial risks related to conducting business internationally, and increased governmental regulation and oversight, information technology performance and security, the ability to protect intellectual property, warranty and product liability claims or product recalls, interest rates, oil and gasoline prices, and availability, the impact of international, national and regional economic conditions and consumer confidence on the retail sale of products for which we sell our components, and other risks and uncertainties discussed more fully under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended
OPERATING RESULTS (unaudited) |
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
|
Last Twelve |
|||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
Months |
|
(In thousands, except per share amounts) |
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Net sales |
$ |
915,497 |
|
$ |
959,315 |
|
$ |
2,938,070 |
|
$ |
2,947,264 |
|
$ |
3,775,614 |
Cost of sales |
|
695,539 |
|
|
748,367 |
|
|
2,227,761 |
|
|
2,332,125 |
|
|
2,904,254 |
Gross profit |
|
219,958 |
|
|
210,948 |
|
|
710,309 |
|
|
615,139 |
|
|
871,360 |
Selling, general and administrative expenses |
|
166,070 |
|
|
165,358 |
|
|
508,206 |
|
|
494,332 |
|
|
666,636 |
Operating profit |
|
53,888 |
|
|
45,590 |
|
|
202,103 |
|
|
120,807 |
|
|
204,724 |
Interest expense, net |
|
6,516 |
|
|
10,325 |
|
|
23,799 |
|
|
30,968 |
|
|
33,255 |
Income before income taxes |
|
47,372 |
|
|
35,265 |
|
|
178,304 |
|
|
89,839 |
|
|
171,469 |
Provision for income taxes |
|
11,760 |
|
|
9,378 |
|
|
44,984 |
|
|
23,267 |
|
|
40,526 |
Net income |
$ |
35,612 |
|
$ |
25,887 |
|
$ |
133,320 |
|
$ |
66,572 |
|
$ |
130,943 |
|
|
|
|
|
|
|
|
|
|
|||||
Net income per common share: |
|
|
|
|
|
|
|
|
|
|||||
Basic |
$ |
1.40 |
|
$ |
1.02 |
|
$ |
5.24 |
|
$ |
2.63 |
|
$ |
5.15 |
Diluted |
$ |
1.39 |
|
$ |
1.02 |
|
$ |
5.23 |
|
$ |
2.62 |
|
$ |
5.14 |
|
|
|
|
|
|
|
|
|
|
|||||
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|||||
Basic |
|
25,480 |
|
|
25,340 |
|
|
25,436 |
|
|
25,293 |
|
|
25,420 |
Diluted |
|
25,558 |
|
|
25,504 |
|
|
25,477 |
|
|
25,405 |
|
|
25,498 |
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
$ |
17,390 |
|
$ |
18,857 |
|
$ |
53,911 |
|
$ |
55,974 |
|
$ |
72,630 |
Amortization |
$ |
13,882 |
|
$ |
14,412 |
|
$ |
42,089 |
|
$ |
42,844 |
|
$ |
56,320 |
Capital expenditures |
$ |
10,062 |
|
$ |
15,978 |
|
$ |
31,390 |
|
$ |
50,060 |
|
$ |
43,539 |
SEGMENT RESULTS (unaudited) |
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
|
Last Twelve |
|||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
Months |
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|||||
Net sales: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment: |
|
|
|
|
|
|
|
|
|
|||||
RV OEMs: |
|
|
|
|
|
|
|
|
|
|||||
Travel trailers and fifth-wheels |
$ |
369,212 |
|
$ |
363,573 |
|
$ |
1,186,324 |
|
$ |
1,032,866 |
|
$ |
1,508,843 |
Motorhomes |
|
52,800 |
|
|
65,669 |
|
|
185,258 |
|
|
206,404 |
|
|
248,210 |
Adjacent Industries OEMs |
|
262,449 |
|
|
299,225 |
|
|
867,315 |
|
|
1,006,378 |
|
|
1,139,938 |
Total OEM Segment net sales |
|
684,461 |
|
|
728,467 |
|
|
2,238,897 |
|
|
2,245,648 |
|
|
2,896,991 |
Aftermarket Segment: |
|
|
|
|
|
|
|
|
|
|||||
Total Aftermarket Segment net sales |
|
231,036 |
|
|
230,848 |
|
|
699,173 |
|
|
701,616 |
|
|
878,623 |
Total net sales |
$ |
915,497 |
|
$ |
959,315 |
|
$ |
2,938,070 |
|
$ |
2,947,264 |
|
$ |
3,775,614 |
|
|
|
|
|
|
|
|
|
|
|||||
Operating profit: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment |
$ |
21,825 |
|
$ |
11,165 |
|
$ |
105,223 |
|
$ |
29,086 |
|
$ |
93,498 |
Aftermarket Segment |
|
32,063 |
|
|
34,425 |
|
|
96,880 |
|
|
91,721 |
|
|
111,226 |
Total operating profit |
$ |
53,888 |
|
$ |
45,590 |
|
$ |
202,103 |
|
$ |
120,807 |
|
$ |
204,724 |
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment depreciation |
$ |
13,270 |
|
$ |
14,835 |
|
$ |
41,038 |
|
$ |
43,840 |
|
$ |
55,596 |
Aftermarket Segment depreciation |
|
4,120 |
|
|
4,022 |
|
|
12,873 |
|
|
12,134 |
|
|
17,034 |
Total depreciation |
$ |
17,390 |
|
$ |
18,857 |
|
$ |
53,911 |
|
$ |
55,974 |
|
$ |
72,630 |
|
|
|
|
|
|
|
|
|
|
|||||
OEM Segment amortization |
$ |
9,996 |
|
$ |
10,550 |
|
$ |
30,426 |
|
$ |
31,204 |
|
$ |
40,802 |
Aftermarket Segment amortization |
|
3,886 |
|
|
3,862 |
|
|
11,663 |
|
|
11,640 |
|
|
15,518 |
Total amortization |
$ |
13,882 |
|
$ |
14,412 |
|
$ |
42,089 |
|
$ |
42,844 |
|
$ |
56,320 |
BALANCE SHEET INFORMATION (unaudited) |
|||||
|
|
|
|
||
|
2024 |
|
2023 |
||
(In thousands) |
|
|
|
||
|
|
|
|
||
ASSETS |
|
|
|
||
Current assets |
|
|
|
||
Cash and cash equivalents |
$ |
161,184 |
|
$ |
66,157 |
Accounts receivable, net |
|
319,166 |
|
|
214,707 |
Inventories, net |
|
705,439 |
|
|
768,407 |
Prepaid expenses and other current assets |
|
59,084 |
|
|
67,599 |
Total current assets |
|
1,244,873 |
|
|
1,116,870 |
Fixed assets, net |
|
443,349 |
|
|
465,781 |
|
|
593,882 |
|
|
589,550 |
Other intangible assets, net |
|
412,818 |
|
|
448,759 |
Operating lease right-of-use assets |
|
233,225 |
|
|
245,388 |
Other long-term assets |
|
96,817 |
|
|
92,971 |
Total assets |
$ |
3,024,964 |
|
$ |
2,959,319 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
||
Current liabilities |
|
|
|
||
Current maturities of long-term indebtedness |
$ |
222 |
|
$ |
589 |
Accounts payable, trade |
|
193,636 |
|
|
183,697 |
Current portion of operating lease obligations |
|
39,035 |
|
|
36,269 |
Accrued expenses and other current liabilities |
|
199,081 |
|
|
174,437 |
Total current liabilities |
|
431,974 |
|
|
394,992 |
Long-term indebtedness |
|
822,322 |
|
|
846,834 |
Operating lease obligations |
|
207,937 |
|
|
222,680 |
Deferred taxes |
|
28,631 |
|
|
32,345 |
Other long-term liabilities |
|
115,778 |
|
|
107,432 |
Total liabilities |
|
1,606,642 |
|
|
1,604,283 |
Total stockholders' equity |
|
1,418,322 |
|
|
1,355,036 |
Total liabilities and stockholders' equity |
$ |
3,024,964 |
|
$ |
2,959,319 |
SUMMARY OF CASH FLOWS (unaudited) |
|||||||
|
Nine Months Ended
|
||||||
|
|
2024 |
|
|
|
2023 |
|
(In thousands) |
|
|
|
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
133,320 |
|
|
$ |
66,572 |
|
Adjustments to reconcile net income to cash flows provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
96,000 |
|
|
|
98,818 |
|
Stock-based compensation expense |
|
13,961 |
|
|
|
14,027 |
|
Other non-cash items |
|
4,927 |
|
|
|
4,611 |
|
Changes in assets and liabilities, net of acquisitions of businesses: |
|
|
|
||||
Accounts receivable, net |
|
(102,127 |
) |
|
|
(121,914 |
) |
Inventories, net |
|
81,166 |
|
|
|
246,155 |
|
Prepaid expenses and other assets |
|
(1,491 |
) |
|
|
31,237 |
|
Accounts payable, trade |
|
8,333 |
|
|
|
54,817 |
|
Accrued expenses and other liabilities |
|
29,599 |
|
|
|
(5,060 |
) |
Net cash flows provided by operating activities |
|
263,688 |
|
|
|
389,263 |
|
Cash flows from investing activities: |
|
|
|
||||
Capital expenditures |
|
(31,390 |
) |
|
|
(50,060 |
) |
Acquisitions of businesses |
|
(19,957 |
) |
|
|
(25,851 |
) |
Other investing activities |
|
781 |
|
|
|
4,284 |
|
Net cash flows used in investing activities |
|
(50,566 |
) |
|
|
(71,627 |
) |
Cash flows from financing activities: |
|
|
|
||||
Vesting of stock-based awards, net of shares tendered for payment of taxes |
|
(9,120 |
) |
|
|
(9,591 |
) |
Proceeds from revolving credit facility |
|
86,248 |
|
|
|
248,900 |
|
Repayments under revolving credit facility |
|
(87,766 |
) |
|
|
(414,554 |
) |
Repayments under term loan and other borrowings |
|
(26,357 |
) |
|
|
(45,767 |
) |
Payment of dividends |
|
(80,191 |
) |
|
|
(79,744 |
) |
Payment of contingent consideration and holdbacks related to acquisitions |
|
(2 |
) |
|
|
(31,857 |
) |
Other financing activities |
|
— |
|
|
|
(834 |
) |
Net cash flows used in financing activities |
|
(117,188 |
) |
|
|
(333,447 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
(907 |
) |
|
|
(446 |
) |
Net increase (decrease) in cash and cash equivalents |
|
95,027 |
|
|
|
(16,257 |
) |
Cash and cash equivalents at beginning of period |
|
66,157 |
|
|
|
47,499 |
|
Cash and cash equivalents at end of period |
$ |
161,184 |
|
|
$ |
31,242 |
|
SUPPLEMENTARY INFORMATION (unaudited) |
||||||||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
||||||||||||
|
|
|
|
|
Last Twelve |
|
||||||||||||
|
2024 |
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
Months |
|
||
Industry Data(1)(in thousands of units): |
|
|
|
|
|
|
|
|
|
|
||||||||
Industry Wholesale Production: |
|
|
|
|
|
|
|
|
|
|
||||||||
Travel trailer and fifth-wheel RVs |
68.5 |
|
|
61.5 |
|
|
|
224.0 |
|
|
|
195.8 |
|
|
|
287.4 |
|
|
Motorhome RVs |
7.7 |
|
|
10.3 |
|
|
|
26.9 |
|
|
|
35.8 |
|
|
|
37.0 |
|
|
Industry Retail Sales: |
|
|
|
|
|
|
|
|
|
|
||||||||
Travel trailer and fifth-wheel RVs |
84.1 |
|
(2) |
92.0 |
|
|
|
248.1 |
|
(2) |
|
273.0 |
|
|
|
301.8 |
|
(2) |
Impact on dealer inventories |
(15.6 |
) |
(2) |
(30.5 |
) |
|
|
(24.1 |
) |
(2) |
|
(77.2 |
) |
|
|
(14.4 |
) |
(2) |
Motorhome RVs |
10.2 |
|
(2) |
11.7 |
|
|
|
31.8 |
|
(2) |
|
37.3 |
|
|
|
39.8 |
|
(2) |
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
Twelve Months Ended |
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
||||
Lippert Content Per Industry Unit Produced: |
|
|
|
|
|
|
|
|||||||||||
Travel trailer and fifth-wheel RV |
|
$ |
5,147 |
|
|
$ |
5,191 |
|
|
|
|
|||||||
Motorhome RV |
|
|
|
|
$ |
3,768 |
|
|
$ |
3,705 |
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2023 |
|
|
||
Balance Sheet Data (debt availability in millions): |
|
|
|
|
|
|
|
|||||||||||
Remaining availability under the revolving credit facility (3) |
|
$ |
383.1 |
|
|
$ |
178.5 |
|
|
$ |
245.3 |
|
|
|||||
Days sales in accounts receivable, based on last twelve months |
|
|
30.6 |
|
|
|
29.2 |
|
|
|
30.1 |
|
|
|||||
Inventory turns, based on last twelve months |
|
|
3.9 |
|
|
|
3.3 |
|
|
|
3.5 |
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
2024 |
|
|
|
||||||||||
Estimated Full Year Data: |
|
|
|
|
|
|
|
|
|
|
||||||||
Capital expenditures |
|
|
|
|
|
|
|
|
||||||||||
Depreciation and amortization |
|
|
|
|
|
|
|
|
||||||||||
Stock-based compensation expense |
|
|
|
|
|
|
|
|
||||||||||
Annual tax rate |
|
|
|
|
24% - 26% |
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
(1) |
Industry wholesale production data for travel trailer and fifth-wheel RVs and motorhome RVs provided by the |
(2) |
|
(3) |
Remaining availability under the revolving credit facility is subject to covenant restrictions. |
SUPPLEMENTARY INFORMATION RECONCILIATION OF NON-GAAP MEASURES (unaudited)
The following table reconciles net income to EBITDA and net income as a percentage of net sales to EBITDA as a percentage of net sales. |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
(In thousands) |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
35,612 |
|
|
$ |
25,887 |
|
|
$ |
133,320 |
|
|
$ |
66,572 |
|
Interest expense, net |
|
6,516 |
|
|
|
10,325 |
|
|
|
23,799 |
|
|
|
30,968 |
|
Provision for income taxes |
|
11,760 |
|
|
|
9,378 |
|
|
|
44,984 |
|
|
|
23,267 |
|
Depreciation expense |
|
17,390 |
|
|
|
18,857 |
|
|
|
53,911 |
|
|
|
55,974 |
|
Amortization expense |
|
13,882 |
|
|
|
14,412 |
|
|
|
42,089 |
|
|
|
42,844 |
|
EBITDA |
$ |
85,160 |
|
|
$ |
78,859 |
|
|
$ |
298,103 |
|
|
$ |
219,625 |
|
|
|
|
|
|
|
|
|
||||||||
Net sales |
$ |
915,497 |
|
|
$ |
959,315 |
|
|
$ |
2,938,070 |
|
|
$ |
2,947,264 |
|
Net income as a percentage of net sales |
|
3.9 |
% |
|
|
2.7 |
% |
|
|
4.5 |
% |
|
|
2.3 |
% |
EBITDA as a percentage of net sales |
|
9.3 |
% |
|
|
8.2 |
% |
|
|
10.1 |
% |
|
|
7.5 |
% |
In addition to reporting financial results in accordance with
View source version on businesswire.com: https://www.businesswire.com/news/home/20241107937464/en/
Phone: (574) 535-1125
E Mail: LCII@lci1.com
Source: