Drew Industries Inc. today (Feb. 16) reported a 34% increase in net income on a 26% rise in sales for the year ended Dec. 31, marking the fourth straight year the firm posted record revenues and earnings.
For the full year, sales reached $669 million compared with $531 million in 2004 while net income increased to $33.6 million from $25.1 million.
Fourth quarter net income more than doubled to $9.3 million compared to $3.5 million a year ago on sales of $181 million, up 37% from the $132 million.
The White Plains, N.Y., company, parent to recreational vehicle and manufactured housing suppliers Lippert Components Inc. and Kinro Inc., noted that performance in the traditionally slow fourth quarter was bolstered by hurricane-related sales to the Federal Emergency Management Agency (FEMA).
“It appears that most of the shelters ordered by FEMA have now been produced, but we do expect to see some carryover into 2006,” said Leigh J. Abrams, Drew’s president and CEO, noting FEMA-related sales totaled approximately $32-$35 million in 2005. “In addition, industry sales in 2006 may increase due both to the need to replenish dealer lots that were depleted while manufacturers diverted their production capabilities to filling FEMA orders, and the permanent rebuilding of the hurricane-stricken areas.”
Drew said its RV segment improved market share and profitability, benefiting from the acquisition of Zieman Manufacturing Co. in 2004 and Venture Welding last May, along with the introduction of several new product lines.
The company reported that sales during January 2006 increased approximately 35% from a year ago and that February sales have started out strong, partly due to the continuing impact of FEMA-related orders.
“We look forward to a solid first quarter as a result of strong sales levels and improving production efficiencies, particularly in some of our newer RV product lines,” said Fred Zinn, executive vice president and CFO. “However, costs of certain key raw materials in our year-end inventory were somewhat higher than material costs expensed during the fourth quarter, and these costs have continued to rise since year-end, which could impact first quarter margins.”