Patrick Industries, Inc. Reports Third Quarter 2024 Financial Results
Patrick Industries (NASDAQ: PATK) reported Q3 2024 financial results with net sales increasing 6% to $919 million, driven by a 13% increase in Housing revenue and the Sportech acquisition, offsetting a 21% decline in Marine revenue. Net income rose 3% to $41 million, with diluted EPS of $1.80. Operating margin decreased 10 basis points to 8.1%. The company completed the acquisition of RecPro, expanding its RV aftermarket presence. Cash flow from operations was $224 million for the first nine months, with a total net leverage ratio of 2.6x and liquidity of $458 million.
Patrick Industries (NASDAQ: PATK) ha riportato i risultati finanziari del terzo trimestre del 2024, con vendite nette aumentate del 6% a $919 milioni, trainate da un aumento del 13% nei ricavi dell'abitazione e dall'acquisizione di Sportech, che ha compensato un calo del 21% nei ricavi marini. L'utile netto è aumentato del 3% a $41 milioni, con un utile per azione diluito di $1.80. Il margine operativo è diminuito di 10 punti base, raggiungendo l'8.1%. L'azienda ha completato l'acquisizione di RecPro, ampliando la sua presenza nel mercato post-vendita per veicoli ricreazionali (RV). Il flusso di cassa dalle operazioni è stato di $224 milioni per i primi nove mesi, con un rapporto totale di leva netta di 2.6x e una liquidità di $458 milioni.
Patrick Industries (NASDAQ: PATK) informó los resultados financieros del tercer trimestre de 2024, con ventas netas aumentando un 6% a $919 millones, impulsadas por un aumento del 13% en los ingresos de vivienda y la adquisición de Sportech, que compensó una caída del 21% en los ingresos marinos. El ingreso neto creció un 3% a $41 millones, con una utilidad por acción diluida de $1.80. El margen operativo disminuyó 10 puntos básicos, alcanzando el 8.1%. La empresa completó la adquisición de RecPro, ampliando su presencia en el mercado de posventa de vehículos recreativos (RV). El flujo de efectivo de las operaciones fue de $224 millones durante los primeros nueve meses, con una relación de apalancamiento neto total de 2.6x y una liquidez de $458 millones.
패트릭 산업 (NASDAQ: PATK)은 2024년 3분기 재무 결과를 발표하며, 순 매출이 6% 증가한 $919 백만 달러에 달했으며, 이는 주거 수익이 13% 증가하고 스포츠텍 인수로 인해 발생했으며, 해양 수익의 21% 감소를 상쇄했습니다. 순 이익은 3% 증가하여 $41 백만 달러에 달했으며, 희석 EPS는 $1.80입니다. 운영 마진은 10 베이시스 포인트 감소하여 8.1%에 이르렀습니다. 회사는 RV 애프터마켓에서의 존재감을 확장하기 위해 RecPro 인수를 완료했습니다. 운영으로 인한 현금 흐름은 처음 아홉 달 동안 $224 백만 달러였으며, 총 순레버리지 비율은 2.6배, 유동성은 $458 백만 달러입니다.
Patrick Industries (NASDAQ: PATK) a publié les résultats financiers du troisième trimestre 2024, avec des ventes nettes augmentant de 6% pour atteindre $919 millions, soutenues par une augmentation de 13% des revenus du secteur résidentiel et par l'acquisition de Sportech, compensant une baisse de 21% des revenus marins. Le revenu net a augmenté de 3% pour atteindre $41 millions, avec un bénéfice par action dilué de $1.80. La marge opérationnelle a diminué de 10 points de base, s'établissant à 8.1%. L'entreprise a finalisé l'acquisition de RecPro, élargissant sa présence sur le marché de l'après-vente des véhicules récréatifs (RV). Le flux de trésorerie provenant des opérations a été de $224 millions pour les neuf premiers mois, avec un ratio total de levier net de 2.6x et une liquidité de $458 millions.
Patrick Industries (NASDAQ: PATK) hat die Finanzzahlen für das dritte Quartal 2024 veröffentlicht, mit einem Anstieg des Nettoumsatzes um 6% auf $919 Millionen, was durch einen Anstieg der Umsätze im Wohnungssektor um 13% und die Akquisition von Sportech bedingt ist, die einen Rückgang der Marineumsätze um 21% ausgleicht. Der Nettogewinn stieg um 3% auf $41 Millionen, mit einem verwässerten Gewinn pro Aktie von $1.80. Die operative Marge verringerte sich um 10 Basispunkte auf 8.1%. Das Unternehmen hat die Akquisition von RecPro abgeschlossen und seine Präsenz im Nachrüstmarkt für Freizeitfahrzeuge (RV) ausgeweitet. Der Cashflow aus dem operativen Geschäft betrug 224 Millionen Dollar in den ersten neun Monaten, mit einem Gesamtnettoverschuldungsgrad von 2,6x und einer Liquidität von 458 Millionen Dollar.
- Net sales increased 6% to $919 million
- Net income grew 3% to $41 million
- Housing revenue increased 13%
- Adjusted EBITDA increased 7% to $121 million
- Strong liquidity position of $458 million
- Strategic acquisition of RecPro expanding market presence
- Operating margin decreased 10 basis points to 8.1%
- Marine revenue declined 21%
- Cash flow from operations decreased from $294M to $224M year-over-year
- Total debt increased by approximately $70 million in Q3
Insights
Patrick Industries delivered a mixed performance in Q3 2024. Net sales grew 6% to
Key positives include strong cash generation with free cash flow of
The company's diversification strategy is proving effective amid varying market conditions. The Housing segment's
Market dynamics show mixed signals - RV shipments increased
Third Quarter 2024 Highlights (compared to Third Quarter 2023 unless otherwise noted)
- Net sales increased
6% to$919 million 13% increase in Housing revenue and our first quarter acquisition of Sportech, which together more than offset a21% decline in Marine revenue. - Operating margin decreased 10 basis points to
8.1% . For the first nine months of 2024, adjusted operating margin improved 20 basis points to7.8% . - Net income increased
3% to$41 million $1.80 $0.06 13% to$5.75 - Adjusted EBITDA increased
7% to$121 million 13.2% . - Cash flow provided by operating activities was
$224 million $294 million $277 million - Completed the acquisition of RecPro, which significantly increases our penetration into the RV aftermarket, while also providing synergy opportunity for our Marine and Powersports end markets to sell through a more advanced aftermarket distribution channel.
- Maintained solid balance sheet and liquidity position, ending the third quarter with a total net leverage ratio of 2.6x following the acquisition of RecPro and liquidity of
$458 million - Subsequent to quarter end, the Company amended and extended the maturity of its credit facility, and also issued
$500 million 6.375% Senior Notes due 2032. The Company plans to redeem its7.500% Senior Notes due 2027 with a portion of the proceeds. - Patrick plans to host an investor day in
New York City on December 3, 2024.
Net sales increased
Operating income of
Net income increased
"The Patrick team delivered another quarter of solid results with revenue and net income growth supported by the continued diversification of our business," said Andy Nemeth, Chief Executive Officer. "The resilience of our model is directly related to the dedication and talent of our incredible team members, and the strategic investments we have made enabling Patrick to perform well during a prolonged period of inventory destocking that has continued to affect our Outdoor Enthusiast end markets at different times over the last two years."
Jeff Rodino, President — RV, said, "This quarter, we welcomed RecPro into our family of brands, which meaningfully expands our position in the direct-to-consumer RV and enthusiast aftermarket. We are energized by the depth and breadth of their product offering, the synergies across our business, and their tremendous leadership and expertise in e-commerce and aftermarket sales. We believe RecPro's efficient distribution channel and significant consumer reach will substantially enhance our ability to provide Patrick's valuable aftermarket solutions across all of our end markets."
Third Quarter 2024 Revenue by Market Sector
(compared to Third Quarter 2023 unless otherwise noted)
RV (
- Revenue of
$396 million 1% while wholesale RV industry unit shipments increased6% . - Content per wholesale RV unit (on a trailing twelve-month basis) decreased by
1% to$4,887 2% .
Marine (
- Revenue of
$136 million 21% while estimated wholesale powerboat industry unit shipments decreased23% . Our Marine end market revenue previously included Powersports revenue, which we began to report separately following the Sportech acquisition. End market revenue and content per unit reflect this change for the relevant periods. - Estimated content per wholesale powerboat unit (on a trailing twelve-month basis) decreased
6% to$3,936
Powersports (
- Revenue of
$87 million 204% , driven primarily by the acquisition of Sportech in the first quarter of 2024.
Housing (
- Revenue of
$300 million 13% ; estimated wholesale MH industry unit shipments increased17% ; total housing starts decreased3% . - Estimated content per wholesale MH unit (on a trailing twelve-month basis) increased
1% to$6,518 1% .
Balance Sheet, Cash Flow and Capital Allocation
For the first nine months of 2024, cash provided by operating activities was
We remained disciplined in allocating and deploying capital, returning approximately
Our total debt at the end of the third quarter was approximately
Subsequent to the end of the quarter, we reduced our cost of debt and increased our liquidity position by issuing
Business Outlook and Summary
"Our team remains confident in the strength of our brand portfolio, disciplined operating model, earnings power of the business, and the profitable runway of opportunity that exists in each of our primary end markets," continued Mr. Nemeth. "We are intensely focusing on elevating the customer experience, invigorating our team's entrepreneurial spirit, winning additional market share by exceeding customer expectations, and growing the business through accretive acquisitions while strategically allocating capital toward automation and innovation initiatives. Over the last year, the teams at Patrick, in collaboration with our Advanced Product Group, have significantly expanded our product development and prototyping activities as a way to bring next-generation solutions to our customers over the next few years. We are optimistic that a positive demand inflection will occur in 2025, and believe recent interest rate reductions, lower inflation levels and continued solid economic data are important ingredients to bring this recovery to fruition, at which point our business is sized and scaled to pivot in alignment with our customers' needs. We are deeply appreciative of the incredible commitment and dedication of our team members and energized by their efforts and drive each and every day."
Conference Call Webcast
Patrick Industries will host an online webcast of its third quarter 2024 earnings conference call that can be accessed on the Company's website, www.patrickind.com, under "For Investors," on Thursday, October 31, 2024 at 10:00 a.m. Eastern Time. In addition, a supplemental earnings presentation can be accessed on the Company's website, www.patrickind.com under "For Investors."
About Patrick Industries, Inc.
Patrick (NASDAQ: PATK) is a leading component solutions provider serving the RV, Marine, Powersports and Housing markets. Since 1959, Patrick has empowered manufacturers and outdoor enthusiasts to achieve next-level recreation experiences. Our customer-focused approach brings together design, manufacturing, distribution, and transportation in a full solutions model that defines us as a trusted partner. Patrick is home to more than 85 leading brands, all united by a commitment to quality, customer service, and innovation. Headquartered in
Cautionary Statement Regarding Forward-Looking Statements
This press release contains certain statements within the meaning of Private Securities Litigation Reform Act of 1995 that are forward-looking in nature. The forward-looking statements are based on current expectations and our actual results may differ materially from those projected in any forward-looking statement. There can be no assurance that any forward-looking statement will be realized or that actual results will not be significantly different from that set forth in such forward-looking statement. Factors that could cause actual results to differ materially from those in forward-looking statements included in this press release include, without limitation: adverse economic and business conditions, including cyclicality and seasonality in the industries we sell our products; the financial condition of our customers or suppliers; the loss of a significant customer; changes in consumer preferences; declines in the level of unit shipments or reduction in growth in the markets we serve; the availability of retail and wholesale financing for RVs, watercraft and powersports products, and residential and manufactured homes; pricing pressures due to competition; costs and availability of raw materials, commodities and energy and transportation; supply chain issues, including financial problems of manufacturers or suppliers and shortages of adequate materials or manufacturing capacity; the challenges and risks associated with doing business internationally; challenges and risks associated with importing products, such as the imposition of duties, tariffs or trade restrictions; the ability to manage our working capital, including inventory and inventory obsolescence; the availability and costs of labor and production facilities and the impact of labor shortages; fuel shortages or high prices for fuel; any interruptions or disruptions in production at one of our key facilities; challenges with integrating acquired businesses; the impact of the consolidation and/or closure of all or part of a manufacturing or distribution facility; an impairment of assets, including goodwill and other long-lived assets; an inability to attract and retain qualified executive officers and key personnel; the effects of union organizing activities; the impact of governmental and environmental regulations, and our inability to comply with them; changes to federal, state, local or certain international tax regulations; unusual or significant litigation, governmental investigations, or adverse publicity arising out of alleged defects in products, services, perceived environmental impacts, or otherwise; public health emergencies or pandemics, such as the COVID-19 pandemic; our level of indebtedness; our inability to comply with the covenants contained in our senior secured credit facility; an inability to access capital when needed; the settlement or conversion of our notes; fluctuations in the market price for our common stock; an inability of our information technology systems to perform adequately; any disruptions in our business due to an IT failure, a cyber-incident or a data breach; any adverse results from our evaluation of our internal controls over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002; certain provisions in our Articles of Incorporation and Amended and Restated By-laws that may delay, defer or prevent a change in control; adverse conditions in the insurance markets; and the impact on our business resulting from wars and military conflicts, such as war in
The Company does not undertake to publicly update or revise any forward-looking statements. Information about certain risks that could affect our business and cause actual results to differ from those express or implied in the forward-looking statements are contained in the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, and in the Company's Forms 10-Q for subsequent quarterly periods, which are filed with the Securities and Exchange Commission ("SEC") and are available on the SEC's website at www.sec.gov. Each forward-looking statement speaks only as of the date of this press release, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date on which it is made.
PATRICK INDUSTRIES, INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||||||
Third Quarter Ended | Nine Months Ended | |||||||
($ in thousands, except per share data) | September 29, | October 1, | September 29, | October 1, | ||||
NET SALES | $ 919,444 | $ 866,073 | $ 2,869,560 | $ 2,686,858 | ||||
Cost of goods sold | 706,930 | 666,954 | 2,220,897 | 2,083,527 | ||||
GROSS PROFIT | 212,514 | 199,119 | 648,663 | 603,331 | ||||
Operating Expenses: | ||||||||
Warehouse and delivery | 37,865 | 37,664 | 114,053 | 109,540 | ||||
Selling, general and administrative | 75,783 | 70,873 | 244,617 | 231,814 | ||||
Amortization of intangible assets | 24,449 | 19,507 | 71,545 | 59,093 | ||||
Total operating expenses | 138,097 | 128,044 | 430,215 | 400,447 | ||||
OPERATING INCOME | 74,417 | 71,075 | 218,448 | 202,884 | ||||
Interest expense, net | 20,050 | 16,879 | 60,483 | 53,623 | ||||
Income before income taxes | 54,367 | 54,196 | 157,965 | 149,261 | ||||
Income taxes | 13,501 | 14,646 | 34,122 | 37,181 | ||||
NET INCOME | $ 40,866 | $ 39,550 | $ 123,843 | $ 112,080 | ||||
BASIC EARNINGS PER COMMON SHARE | $ 1.88 | $ 1.84 | $ 5.71 | $ 5.20 | ||||
DILUTED EARNINGS PER COMMON SHARE | $ 1.80 | $ 1.81 | $ 5.55 | $ 5.09 | ||||
Weighted average shares outstanding - Basic | 21,740 | 21,511 | 21,706 | 21,541 | ||||
Weighted average shares outstanding - Diluted | 22,641 | 21,884 | 22,297 | 22,063 | ||||
PATRICK INDUSTRIES, INC. | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) | ||||
As of | ||||
($ in thousands) | September 29, 2024 | December 31, 2023 | ||
ASSETS | ||||
Current Assets: | ||||
Cash and cash equivalents | $ 52,606 | $ 11,409 | ||
Trade and other receivables, net | 255,369 | 163,838 | ||
Inventories | 545,445 | 510,133 | ||
Prepaid expenses and other | 59,539 | 49,251 | ||
Total current assets | 912,959 | 734,631 | ||
Property, plant and equipment, net | 369,342 | 353,625 | ||
Operating lease right-of-use assets | 205,110 | 177,717 | ||
Goodwill and intangible assets, net | 1,628,358 | 1,288,546 | ||
Other non-current assets | 7,184 | 7,929 | ||
TOTAL ASSETS | $ 3,122,953 | $ 2,562,448 | ||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||
Current Liabilities: | ||||
Current maturities of long-term debt | $ 11,250 | $ 7,500 | ||
Current operating lease liabilities | 53,335 | 48,761 | ||
Accounts payable | 189,274 | 140,524 | ||
Accrued liabilities | 125,330 | 111,711 | ||
Total current liabilities | 379,189 | 308,496 | ||
Long-term debt, less current maturities, net | 1,377,727 | 1,018,356 | ||
Long-term operating lease liabilities | 156,083 | 132,444 | ||
Deferred tax liabilities, net | 68,012 | 46,724 | ||
Other long-term liabilities | 12,461 | 11,091 | ||
TOTAL LIABILITIES | 1,993,472 | 1,517,111 | ||
TOTAL SHAREHOLDERS' EQUITY | 1,129,481 | 1,045,337 | ||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 3,122,953 | $ 2,562,448 | ||
PATRICK INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
| ||||
Nine Months Ended | ||||
($ in thousands) | September 29, 2024 | October 1, 2023 | ||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||
Net income | $ 123,843 | $ 112,080 | ||
Depreciation and amortization | 124,002 | 107,976 | ||
Stock-based compensation expense | 14,367 | 13,675 | ||
Other adjustments to reconcile net income to net cash provided by operating activities | 2,335 | 4,024 | ||
Change in operating assets and liabilities, net of acquisitions of businesses | (40,357) | 56,075 | ||
Net cash provided by operating activities | 224,190 | 293,830 | ||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||
Purchases of property, plant and equipment | (50,264) | (47,430) | ||
Business acquisitions and other investing activities | (435,137) | (28,033) | ||
Net cash used in investing activities | (485,401) | (75,463) | ||
NET CASH FLOWS PROVIDED BY (USED IN) FINANCING ACTIVITIES | 302,408 | (224,764) | ||
Net increase (decrease) in cash and cash equivalents | 41,197 | (6,397) | ||
Cash and cash equivalents at beginning of year | 11,409 | 22,847 | ||
Cash and cash equivalents at end of period | $ 52,606 | $ 16,450 | ||
PATRICK INDUSTRIES, INC. Earnings Per Common Share (Unaudited)
| ||||||||
The table below illustrates the calculation for earnings per common share:
| ||||||||
Third Quarter Ended | Nine Months Ended | |||||||
($ in thousands, except per share data) | September 29, | October 1, | September 29, | October 1, | ||||
Numerator: | ||||||||
Earnings for basic earnings per common share calculation | $ 40,866 | $ 39,550 | $ 123,843 | $ 112,080 | ||||
Effect of interest on potentially dilutive convertible notes, net of tax | — | — | — | 162 | ||||
Earnings for diluted earnings per common share calculation | $ 40,866 | $ 39,550 | $ 123,843 | $ 112,242 | ||||
Denominator: | ||||||||
Weighted average common shares outstanding - basic | 21,740 | 21,511 | 21,706 | 21,541 | ||||
Weighted average impact of potentially dilutive convertible notes | 554 | — | 340 | 221 | ||||
Weighted average impact of potentially dilutive warrants | 117 | — | 39 | — | ||||
Weighted average impact of potentially dilutive securities | 230 | 373 | 212 | 301 | ||||
Weighted average common shares outstanding - diluted | 22,641 | 21,884 | 22,297 | 22,063 | ||||
Earnings per common share: | ||||||||
Basic earnings per common share | $ 1.88 | $ 1.84 | $ 5.71 | $ 5.20 | ||||
Diluted earnings per common share | $ 1.80 | $ 1.81 | $ 5.55 | $ 5.09 | ||||
PATRICK INDUSTRIES, INC.
Non-GAAP Reconciliation (Unaudited)
Use of Non-GAAP Financial Metrics
In addition to reporting financial results in accordance with
The following table reconciles net income to EBITDA and adjusted EBITDA: | ||||||||
Third Quarter Ended | Nine Months Ended | |||||||
($ in thousands) | September 29, | October 1, | September 29, | October 1, | ||||
Net income | $ 40,866 | $ 39,550 | $ 123,843 | $ 112,080 | ||||
+ Depreciation & amortization | 42,186 | 36,484 | 124,002 | 107,976 | ||||
+ Interest expense, net | 20,050 | 16,879 | 60,483 | 53,623 | ||||
+ Income taxes | 13,501 | 14,646 | 34,122 | 37,181 | ||||
EBITDA | 116,603 | 107,559 | 342,450 | 310,860 | ||||
+ Stock-based compensation | 4,625 | 5,729 | 14,367 | 13,675 | ||||
+ Acquisition related transaction costs | — | — | 4,998 | — | ||||
+ Acquisition related fair-value inventory step-up | — | — | 822 | 610 | ||||
+ (Gain) Loss on sale of property, plant and equipment | (34) | 142 | (402) | 242 | ||||
Adjusted EBITDA | $ 121,194 | $ 113,430 | $ 362,235 | $ 325,387 | ||||
The following table reconciles cash flow from operations to free cash flow on a trailing twelve-month basis: | ||||
Trailing Twelve Months Ended | ||||
($ in thousands) | September 29, 2024 | October 1, 2023 | ||
Cash flow from operating activities | $ 339,032 | $ 475,760 | ||
Less: purchases of property, plant and equipment | (61,821) | (63,876) | ||
Free cash flow | $ 277,211 | $ 411,884 | ||
The following table reconciles operating margin to adjusted operating margin: | ||||||||
Third Quarter Ended | Nine Months Ended | |||||||
September 29, | October 1, | September 29, | October 1, | |||||
Operating margin | 8.1 % | 8.2 % | 7.6 % | 7.6 % | ||||
Acquisition related fair-value inventory step-up | — % | — % | — % | — % | ||||
Transaction costs | — % | — % | 0.2 % | — % | ||||
Adjusted operating margin | 8.1 % | 8.2 % | 7.8 % | 7.6 % | ||||
The following table reconciles net income to adjusted net income and diluted earnings per common share to adjusted diluted earnings per common share: | ||||||||
Third Quarter Ended | Nine Months Ended | |||||||
($ in thousands, except per share data) | September 29, | October 1, | September 29, | October 1, | ||||
Net income | $ 40,866 | $ 39,550 | $ 123,843 | $ 112,080 | ||||
+ Acquisition related fair-value inventory step-up | — | — | 822 | 610 | ||||
+ Transaction costs | — | — | 4,998 | — | ||||
- Tax impact of adjustments | — | — | (1,488) | (154) | ||||
Adjusted net income | $ 40,866 | $ 39,550 | $ 128,175 | $ 112,536 | ||||
Diluted earnings per common share (per above) | $ 1.80 | $ 1.81 | $ 5.55 | $ 5.09 | ||||
Transaction costs, net of tax | — | — | 0.17 | — | ||||
Acquisition related fair-value inventory step-up, net of tax | — | — | 0.03 | 0.01 | ||||
Adjusted diluted earnings per common share | $ 1.80 | $ 1.81 | $ 5.75 | $ 5.10 | ||||
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SOURCE Patrick Industries, Inc.
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