ELKHART, Ind., Aug. 4, 2017 /PRNewswire/ -- LCI Industries
(NYSE: LCII) ("LCI", or the "Company"), a supplier of components
for the leading original equipment manufacturers ("OEMs") of
recreational vehicles ("RVs") and adjacent industries, and the
related aftermarkets of those industries, today reported
consolidated net sales in the second quarter of 2017 of
$547 million, 24 percent higher than
the 2016 second quarter net sales of $441
million. Net income was $40.1
million, or $1.59 per diluted
share, for the second quarter ended June 30, 2017, compared to
net income of $37.6 million, or
$1.51 per diluted share, for the
second quarter ended June 30, 2016.
The increase in year-over-year net sales reflects industry-wide
growth in wholesale shipments of towable and motorized RVs by OEMs,
which increased 17 percent and 11 percent, respectively, in the
second quarter of 2017, enhanced by acquisitions completed by the
Company over the twelve months ended June 30, 2017, which
added $17 million in net sales in the
second quarter of 2017. Organic growth accounted for 20 of the 24
percent growth in consolidated net sales for the second quarter and
growth from acquisitions provided the remainder. Through continued
focus on aftermarket channels for the Company's products, the
Company increased net sales to the aftermarket in the second
quarter of 2017 by 32 percent to $45
million.
"The RV industry growth trend in 2017 remains strong as second
quarter wholesale RV shipments were up 15 percent," stated
Jason Lippert, LCI's Chief Executive
Officer. "RV sales momentum has continued as the industry attracts
a new generation of RV enthusiasts, and orders appear to be strong
going into the third quarter as dealer sentiment remains bullish
and OEMs continue to add capacity to meet demand.
Additionally, we continue to see strong growth in our Aftermarket
sales."
The health of the RV industry is determined by retail demand,
which is up 11 percent through May, as reported by Statistical
Surveys, Inc, and will likely be revised upwards in future months
as various states report. Based on the retail sales strength
experienced through 2016 and midway through 2017, as well as sales
order backlogs reported by RV OEMs at record levels, the current
outlook from several RV OEMs and their dealer networks remains very
positive. Additionally, the RVIA's current forecast of wholesale
unit shipments of approximately 472,000 units has been revised
upward from its original Fall forecast of 411,000 for the full year
2017. The RVIA's forecast for 2018 is estimated to increase an
additional three percent to approximately 487,000.
The Company's content per travel trailer and fifth-wheel RV for
the twelve months ended June 30, 2017, increased $91 to $3,104,
compared to the twelve months ended June 30, 2016, of
$3,013. The Company's content per
motorhome RV for the twelve months ended June 30, 2017,
increased $152 to $2,072, compared to the twelve months ended
June 30, 2016, of $1,920. The
content increases are a combined result of organic growth,
including new product introductions, as well as acquisitions and
changes in the types of RVs produced industry-wide.
In July 2017, LCI's consolidated
net sales reached approximately $150
million, 27 percent higher than July
2016. "As the industry prepares to meet the anticipated
demand of the 2017 summer selling season, I am encouraged by July
sales following up on a strong second quarter, and pleased to see
Aftermarket sales up over 35 percent in July," said Jason Lippert.
"Our operating profit in the second quarter of 2017 improved to
$63.0 million, compared to
$59.4 million in the second quarter
of 2016," said Scott Mereness, LCI's
President. "Strong industry growth and accretive acquisitions
completed over the last year have contributed to profit growth for
the quarter. We continue to focus on cost management and
investments in lean initiatives and other operational efficiencies
to further improve operating margin while supporting the growth of
the business."
Balance Sheet and Other Items
At June 30, 2017,
the Company had a cash balance of $38
million, a decrease of $48
million from a cash balance of $86
million at the beginning of the year, primarily as a result
of $68 million used for acquisitions,
$43 million for capital expenditures
and $25 million of dividend payments
in the first six months of 2017.
Return on equity for the twelve months ended June 30, 2017,
improved to 25.0 percent, from the 24.1 percent return on equity at
June 30, 2016. Return on invested capital for the twelve
months ended June 30, 2017, improved to 39.0 percent, from the
34.2 percent return on invested capital at June 30, 2016.
Jason Lippert concluded, "For the
first time in the Company's history, we have reached $1 billion in revenue at the half-way point of
the year; an extraordinary feat as we only reached $1 billion in total yearly revenue just over
three years ago. Our continuing growth story is a testament to the
focus of our 9,000 team members."
Conference Call & Webcast
LCI will provide an
online, real-time webcast of its second quarter 2017 earnings
conference call on the Company's website, www.lci1.com/investors,
on Friday, August 4, 2017, at 11:00
a.m. Eastern time.
Institutional investors can access the call via the
password-protected site, StreetEvents (www.streetevents.com). A
replay of the call will be available for two weeks by dialing (855)
859-2056 and referencing access code 55158619. A replay of the
webcast will also be available on LCI's website until the next
quarterly conference call.
About LCI Industries
From 52 manufacturing and distribution facilities located
throughout the United States and
in Canada and Italy, LCI Industries, through its
wholly-owned subsidiary, Lippert Components, Inc., supplies,
domestically and internationally, a broad array of components for
the leading original equipment manufacturers of recreational
vehicles; buses; trailers used to haul boats, livestock, equipment
and other cargo; trucks; pontoon boats; trains; manufactured homes;
and modular housing. The Company also supplies components to the
related aftermarkets of these industries primarily by selling to
retail dealers, wholesale distributors and service centers. LCI's
products include steel chassis and related components; axles and
suspension solutions; slide-out mechanisms and solutions;
thermoformed bath, kitchen and other products; vinyl, aluminum and
frameless windows; manual, electric and hydraulic stabilizer and
leveling systems; furniture and mattresses; entry, luggage, patio
and ramp doors; electric and manual entry steps; awnings and awning
accessories; electronic components; televisions and sound systems;
navigation systems; backup cameras; appliances; and other
accessories. Additional information about LCI and its products can
be found at www.lci1.com.
Forward-Looking Statements
This press release contains certain "forward-looking statements"
with respect to our financial condition, results of operations,
business strategies, operating efficiencies or synergies,
competitive position, growth opportunities, acquisitions, plans and
objectives of management, markets for the Company's Common Stock
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 our future business prospects, net sales, expenses and
income (loss), cash flow, and financial condition, 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, pricing pressures
due to domestic and foreign competition, costs and availability of
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, employee benefits, employee 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, 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, 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 December 31, 2016, and in the Company's
subsequent filings with the Securities and Exchange Commission. The
Company disclaims any obligation or undertaking to update
forward-looking statements to reflect circumstances or events that
occur after the date the forward-looking statements are made,
except as required by law.
LCI
INDUSTRIES
|
OPERATING
RESULTS
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
June 30,
|
|
June 30,
|
|
Last
Twelve
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Months
|
(In thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
1,045,819
|
|
$
863,629
|
|
$
547,483
|
|
$
440,831
|
|
$
1,861,088
|
Cost of
sales
|
|
790,718
|
|
638,284
|
|
416,396
|
|
323,927
|
|
1,402,429
|
Gross
profit
|
|
255,101
|
|
225,345
|
|
131,087
|
|
116,904
|
|
458,659
|
Selling, general and
administrative expenses
|
|
132,932
|
|
110,229
|
|
68,047
|
|
57,516
|
|
250,756
|
Operating
profit
|
|
122,169
|
|
115,116
|
|
63,040
|
|
59,388
|
|
207,903
|
Interest expense,
net
|
|
851
|
|
889
|
|
414
|
|
413
|
|
1,640
|
Income before income
taxes
|
|
121,318
|
|
114,227
|
|
62,626
|
|
58,975
|
|
206,263
|
Provision for income
taxes
|
|
38,036
|
|
40,699
|
|
22,489
|
|
21,406
|
|
66,838
|
Net income
|
|
$
83,282
|
|
$
73,528
|
|
$
40,137
|
|
$
37,569
|
|
$
139,425
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
3.34
|
|
$
3.00
|
|
$
1.61
|
|
$
1.52
|
|
$
5.61
|
Diluted
|
|
$
3.29
|
|
$
2.96
|
|
$
1.59
|
|
$
1.51
|
|
$
5.53
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
24,959
|
|
24,542
|
|
24,992
|
|
24,662
|
|
24,868
|
Diluted
|
|
25,296
|
|
24,822
|
|
25,305
|
|
24,916
|
|
25,191
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
$
25,530
|
|
$
22,190
|
|
$
13,289
|
|
$
11,247
|
|
$
49,507
|
Capital
expenditures
|
|
$
43,276
|
|
$
12,971
|
|
$
31,256
|
|
$
6,513
|
|
$
73,515
|
|
|
|
|
|
|
|
|
|
|
|
LCI
INDUSTRIES
|
SEGMENT
RESULTS
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
June 30,
|
|
June 30,
|
|
Last
Twelve
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Months
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
OEM
Segment:
|
|
|
|
|
|
|
|
|
|
|
RV OEMs:
|
|
|
|
|
|
|
|
|
|
|
Travel trailers and
fifth-wheels
|
|
$
687,525
|
|
$
573,055
|
|
$
357,251
|
|
$
289,686
|
|
$
1,214,352
|
Motorhomes
|
|
73,292
|
|
56,389
|
|
36,248
|
|
27,866
|
|
133,094
|
Adjacent industries
OEMs
|
|
203,987
|
|
170,125
|
|
109,276
|
|
89,364
|
|
365,880
|
Total OEM Segment net
sales
|
|
964,804
|
|
799,569
|
|
502,775
|
|
406,916
|
|
1,713,326
|
Aftermarket
Segment:
|
|
|
|
|
|
|
|
|
|
|
Total Aftermarket
Segment net sales
|
|
81,015
|
|
64,060
|
|
44,708
|
|
33,915
|
|
147,762
|
Total net
sales
|
|
$
1,045,819
|
|
$
863,629
|
|
$
547,483
|
|
$
440,831
|
|
$
1,861,088
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Profit:
|
|
|
|
|
|
|
|
|
|
|
OEM
Segment
|
|
$
110,842
|
|
$
105,053
|
|
$
56,445
|
|
$
54,402
|
|
$
186,639
|
Aftermarket
Segment
|
|
11,327
|
|
10,063
|
|
6,595
|
|
4,986
|
|
21,264
|
Total operating
profit
|
|
$
122,169
|
|
$
115,116
|
|
$
63,040
|
|
$
59,388
|
|
$
207,903
|
|
|
|
|
|
|
|
|
|
|
|
LCI
INDUSTRIES
|
BALANCE SHEET
INFORMATION
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
2016
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
37,961
|
|
$
78,560
|
|
$
86,170
|
Accounts receivable,
net
|
|
130,514
|
|
102,355
|
|
57,374
|
Inventories,
net
|
|
202,635
|
|
149,163
|
|
188,743
|
Prepaid expenses and
other current assets
|
|
43,977
|
|
25,613
|
|
35,107
|
Total current
assets
|
|
415,087
|
|
355,691
|
|
367,394
|
Fixed assets,
net
|
|
203,204
|
|
151,250
|
|
172,748
|
Goodwill
|
|
122,275
|
|
93,831
|
|
89,198
|
Other intangible
assets, net
|
|
138,876
|
|
114,000
|
|
112,943
|
Deferred
taxes
|
|
31,864
|
|
29,391
|
|
31,989
|
Other
assets
|
|
13,344
|
|
13,656
|
|
12,632
|
Total
assets
|
|
$
924,650
|
|
$
757,819
|
|
$
786,904
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts payable,
trade
|
|
$
80,596
|
|
$
53,330
|
|
$
50,616
|
Accrued expenses and
other current liabilities
|
|
114,454
|
|
113,244
|
|
98,735
|
Total current
liabilities
|
|
195,050
|
|
166,574
|
|
149,351
|
Long-term
indebtedness
|
|
49,911
|
|
49,930
|
|
49,949
|
Other long-term
liabilities
|
|
59,934
|
|
38,284
|
|
37,335
|
Total
liabilities
|
|
304,895
|
|
254,788
|
|
236,635
|
Total stockholders'
equity
|
|
619,755
|
|
503,031
|
|
550,269
|
Total liabilities and
stockholders' equity
|
|
$
924,650
|
|
$
757,819
|
|
$
786,904
|
|
|
|
|
|
|
|
LCI
INDUSTRIES
|
SUMMARY OF CASH
FLOWS
|
(unaudited)
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
June 30,
|
|
|
2017
|
|
2016
|
(In
thousands)
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net income
|
|
$
83,282
|
|
$
73,528
|
Adjustments to
reconcile net income to cash flows provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
|
25,530
|
|
22,190
|
Stock-based
compensation expense
|
|
9,312
|
|
7,274
|
Other non-cash
items
|
|
2,198
|
|
809
|
Changes in assets and
liabilities, net of acquisitions of businesses:
|
|
|
|
|
Accounts receivable,
net
|
|
(61,455)
|
|
(58,777)
|
Inventories,
net
|
|
(6,804)
|
|
25,590
|
Prepaid expenses and
other assets
|
|
(9,337)
|
|
(4,199)
|
Accounts payable,
trade
|
|
22,542
|
|
21,496
|
Accrued expenses and
other liabilities
|
|
32,476
|
|
45,440
|
Net cash flows
provided by operating activities
|
|
97,744
|
|
133,351
|
Cash flows from
investing activities:
|
|
|
|
|
Capital
expenditures
|
|
(43,276)
|
|
(13,309)
|
Acquisitions of
businesses, net of cash acquired
|
|
(67,876)
|
|
(34,237)
|
Proceeds from sales
of fixed assets
|
|
265
|
|
337
|
Other investing
activities
|
|
(8)
|
|
(237)
|
Net cash flows used
for investing activities
|
|
(110,895)
|
|
(47,446)
|
Cash flows from
financing activities:
|
|
|
|
|
Exercise of
stock-based awards, net of shares tendered for payment of
taxes
|
|
(7,543)
|
|
(1,144)
|
Proceeds from line of
credit borrowings
|
|
-
|
|
81,458
|
Repayments under line
of credit borrowings
|
|
-
|
|
(81,458)
|
Payment of
dividends
|
|
(24,887)
|
|
(14,707)
|
Payment of contingent
consideration related to acquisitions
|
|
(2,569)
|
|
(2,715)
|
Other financing
activities
|
|
(59)
|
|
(1,084)
|
Net cash flows used
for financing activities
|
|
(35,058)
|
|
(19,650)
|
|
|
|
|
|
Net (decrease)
increase in cash and cash equivalents
|
|
(48,209)
|
|
66,255
|
|
|
|
|
|
Cash and cash
equivalents at beginning of period
|
|
86,170
|
|
12,305
|
Cash and cash
equivalents at end of period
|
|
$
37,961
|
|
$
78,560
|
|
|
|
|
|
LCI
INDUSTRIES
|
SUPPLEMENTARY
INFORMATION
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
Three Months
Ended
|
|
|
|
|
|
June 30,
|
|
June 30,
|
|
Last
Twelve
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Months
|
|
Industry
Data(1)(in thousands of units):
|
|
|
|
|
|
|
|
|
|
|
|
Industry Wholesale
Production:
|
|
|
|
|
|
|
|
|
|
|
|
Travel trailer and
fifth-wheel RVs
|
|
217.4
|
|
190.0
|
|
115.9
|
|
99.2
|
|
390.1
|
|
Motorhome
RVs
|
|
32.8
|
|
28.8
|
|
16.5
|
|
14.8
|
|
58.8
|
|
Industry Retail
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
Travel trailer and
fifth-wheel RVs
|
|
210.1
|
(2)
|
185.7
|
|
137.5
|
(2)
|
122.8
|
|
377.1
|
(2)
|
Impact on dealer
inventories
|
|
7.3
|
(2)
|
4.3
|
|
(21.6)
|
(2)
|
(23.6)
|
|
13.0
|
(2)
|
Motorhome
RVs
|
|
27.6
|
(2)
|
24.3
|
|
16.5
|
(2)
|
14.8
|
|
50.0
|
(2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
|
|
|
|
|
|
|
|
2017
|
|
2016
|
|
|
|
LCI Content Per
Industry Unit Produced:
|
|
|
|
|
|
|
|
|
|
|
|
Travel trailer and
fifth-wheel RV
|
|
|
|
|
|
$
3,104
|
|
$
3,013
|
|
|
|
Motorhome
RV
|
|
|
|
|
|
$
2,072
|
|
$
1,920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
|
|
December
31,
|
|
|
|
|
|
|
|
2017
|
|
2016
|
|
2016
|
|
Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
|
|
|
Current
ratio
|
|
|
|
|
|
2.1
|
|
2.1
|
|
2.5
|
|
Total indebtedness to
stockholders' equity
|
|
|
|
|
|
0.1
|
|
0.1
|
|
0.1
|
|
Days sales in
accounts receivable
|
|
|
|
|
|
22.4
|
|
20.2
|
|
15.8
|
|
Inventory turns,
based on last twelve months
|
|
|
|
|
|
7.8
|
|
7.0
|
|
7.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
|
Estimated Full Year
Data:
|
|
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
|
|
|
$ 65 - $ 75
million
|
|
|
|
Depreciation and
amortization
|
|
|
|
|
|
$ 55 - $ 60
million
|
|
|
|
Stock-based
compensation expense
|
|
|
|
|
|
$ 19 - $ 21
million
|
|
|
|
Annual tax
rate
|
|
|
|
|
|
33% - 34%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Industry wholesale production data for travel trailer and
fifth-wheel RVs and motorhome RVs provided by the Recreation
Vehicle Industry Association. Industry retail sales data provided
by Statistical Surveys, Inc.
|
|
|
|
|
|
|
|
|
|
|
(2) June
2017 retail sales data for RVs has not been published yet,
therefore 2017 retail data for RVs includes an estimate for June
2017 retail units. Retail sales data will likely be revised upwards
in future months as various states report.
|
View original
content:http://www.prnewswire.com/news-releases/lci-industries-reports-2017-second-quarter-results-300499549.html
SOURCE LCI Industries