The Recreation Vehicle Industry Association commissioned an Economic Impact Study on the RV industry, released on June 7, 2016. The study found that the RV industry contributes about $49.7 billion in economic output or 0.28 percent of the Gross Domestic Product. Through its production and distribution linkages, the industry impacts firms in 426 of the 440 sectors of the United States economy.
Nationwide, the industry is responsible for 216,170 jobs, both directly and inderectly, creating an economic impact of $37.5 billion. The full study results, along with each individual state and congressional district's economic impact is available on the website by clicking here .
Thu Oct 27, 2016
ELKHART, Indiana - Patrick Industries, Inc. net sales for the 2016 third quarter increased $89.4 million, or 42 percent, to $304.2 million from $214.8 million in the same quarter of 2015, the company released in its results ended Sept. 25.
The increase was primarily attributable to a 43 percent increase in the company's revenue from the RV industry, which reflected the incremental contribution from acquisitions completed in 2015 and 2016 and industry growth. According to industry sources, RV industry wholesale unit shipments increased about 19 percent in the third quarter of 2016 compared to the prior year. Sales to the RV industry represented 73 percent of the company's third quarter 2016 sales. Revenue from the MH industry, which represented 14 percent of the company's third quarter 2016 sales, increased 26 percent. The company estimates that wholesale unit shipments in the MH industry rose about 5 percent from the third quarter of 2015. Additionally, sales to the industrial markets increased 50 percent compared to the prior year period. The industrial market sector, which is tied primarily to residential housing and non-residential construction spending, accounted for 13 percent of the company's third quarter 2016 sales.
For the third quarter of 2016, Patrick reported operating income of $20.1 million, an increase of 32 percent, or $4.9 million, from the $15.2 million reported in the third quarter of 2015. Net income in the third quarter of 2016 increased 34 percent to $12 million from $9 million in the third quarter of 2015, while net income per diluted share increased 36 percent to $0.79 from $0.58.
"We are pleased with our third quarter revenue growth that was supported by our acquisition and strategic growth initiatives, as well as continued strength in the RV and MH markets," Patrick CEO Todd Cleveland says. "In addition, there was optimism and excitement coming out of the recent RV manufacturers' open houses held in September. MH industry growth continues to outpace new housing starts, indicating increased demand. Our industrial revenues grew at a significant pace as we introduce products into adjacent markets and position our industrial sales team to penetrate new markets."
"Overall, we remain encouraged by the ongoing strength in the RV market and the related demographic trends supporting the opportunity for long-term industry growth potential," Patrick President Andy Nemeth says. "We experienced demand levels during the third quarter that exceeded expected seasonal demand patterns, particularly in the RV industry. In anticipation of continuing strong demand in the fourth quarter and in preparation for continued growth into 2017, we launched a strategic capital expenditure program in the third quarter of 2016 centered around investment in facility improvements, increased capacity and more advanced automation. This initiative, which involves an incremental $4.5 million of capital spending starting in the third quarter of 2016 and into 2017, will help ensure we have adequate capacity to meet demand, improve operating efficiencies and address our customers' changing needs and buying patterns as they look for new, innovative products in the marketplace."
Net sales for the first nine months of 2016 increased $226.3 million or 34 percent, to $898 million from $671.7 million in the same period in 2015. For the first nine months of 2016, the company's revenue from the RV industry, which represented 75 percent of its nine months 2016 sales, increased by 33 percent. According to industry sources, RV industry wholesale unit shipments increased about 14 percent in the first nine months of 2016 compared to the prior year. Additionally, revenue from the MH industry, which represented 13 percent of the company's nine months 2016 sales, rose 25 percent compared to the prior year as MH wholesale unit shipments, as estimated by the company, increased by about 14 percent. Revenue from the industrial market increased 46 percent and benefited primarily from acquisitions and market share gains, particularly in the commercial and institutional fixtures markets. The industrial market, which accounted for 12 percent of the company's nine months 2016 sales, saw new housing starts increase by about 4 percent for the first nine months of 2016 compared to the prior year. The company estimates that about 50 percent of its industrial market sales are linked to the residential housing sector and its sales to the industrial markets generally lag new housing starts by about six to nine months.
The company's RV content per unit (on a trailing 12-month basis) for the third quarter of 2016 increased about 20 percent to $2,085 from $1,739 for the third quarter of 2015. The MH content per unit (on a trailing 12-month basis) for the third quarter of 2016 increased about 5 percent to an estimated $1,911 from $1,820 for the third quarter of 2015.
For the first nine months of 2016, Patrick reported operating income of $68.7 million, an increase of $17.6 million or 34 percent, from the $51.1 million reported in the first nine months of 2015. Net income in the first nine months of 2016 increased 35 percent to $40.8 million from $30.2 million in the first nine months of 2015, while net income per diluted share increased 37 percent to $2.68 from $1.95.
The company invested about $127.6 million, in the aggregate, for acquisitions, capital expenditures and stock repurchases in the first nine months of 2016, while total debt, net of cash on hand, increased $75 million to $278.8 million at Sept. 25 from $203.8 million at Dec. 31, 2015. Patrick's total assets increased $152.5 million to $534.1 million at Sept. 25 from $381.6 million at Dec. 31, 2015, primarily reflecting the addition of acquisition-related assets, seasonality and overall growth.
In the first nine months of 2016, the company repurchased 110,738 shares, in the aggregate, of its common stock at an average price of $42.14 for a total cost of $4.7 million under its stock buyback programs.
"Our performance in the first nine months of the year is a reflection of the dedication and commitment of our more than 4,800 team members in our ongoing efforts to better serve our customer base with new and innovative high-quality product lines and provide exceptional customer service," Cleveland says. "Our team will continue to execute on our strategic initiatives, positioning ourselves to capitalize on strategic acquisitions, grow market share and increase our content per unit."