Elkhart, Ind.-based supplier Patrick Industries Inc. reported a 49% increase in sales for its second quarter while net income soared 64%.
Net sales totaled $604.9 million from $407.1 million in the same quarter of 2017. The increase was attributable to industry growth, acquisitions, geographic expansion efforts, and market share gains.
Patrick reported net income of $34.9 million compared with $21.3 million in the second quarter of 2017, while net income per diluted share increased 67% to $1.42 from 85 cents.
The company’s revenues from the RV industry, which represented 65% of second quarter 2018 sales, increased 41%. RV industry wholesale unit shipments decreased approximately 1% in the second quarter from a year ago which had the highest second-quarter wholesale unit shipments level on record. Patrick’s RV content per unit (on a trailing 12-month basis) for the second quarter increased approximately 26% to $2,639 from $2,101 for the second quarter of 2017.
For the second quarter, Patrick reported operating income of $53.1 million, an increase of 57% or $19.4 million, from $33.7 million reported a year ago.
Todd Cleveland, chairman and CEO, said, “We are pleased with our overall operating and financial results in the second quarter as our performance reflects the continued successful execution of our strategic growth plans, coupled with the ongoing positive momentum in the primary markets we serve. During the second quarter of 2018, we completed three strategic acquisitions — Dehco in April, Dowco in May, and Marine Accessories in June. In addition, we expanded our credit facility in June 2018 to continue to support our long-term strategic growth plan.”
“RV and marine retail shipments remain strong, supported by solid fundamentals and demographic trends with new buyers continuing to enter the market, attracted to the outdoor, leisure family-oriented lifestyle,” stated Andy Nemeth, president. “Our housing and industrial markets also continue to experience growth driven by strong demographic trends, improving consumer credit, the strengthening economy and jobs environment, and overall consumer confidence.”
Six Months 2018 Financial Results
Net sales for the first six months of 2018 increased $404.1 million or 54%, to $1,156.7 million from $752.6 million in the same period of 2017. The company’s revenues from the RV industry, which represented 67% of its six months 2018 sales, increased 46%. RV industry wholesale unit shipments increased approximately 6% in the first six months of 2018 compared to the prior year.
For the first six months of 2018, Patrick reported operating income of $94.8 million, an increase of $37.2 million or 65%, from the $57.6 million reported in the first six months of 2017. Net income increased 68% to $64.9 million from $38.7 million in the first six months of 2017, while net income per diluted share increased 64% to $2.62 from $1.60.
Patrick’s total assets increased $323.5 million to $1.2 billion at July 1, from $866.6 million at December 31, 2017, primarily reflecting the addition of acquisition-related assets, seasonality, and overall growth.
“The balance within our revenue mix and core market diversification, which is now 65% and 35% RV and non-RV, respectively, provide us with an attractive platform to continue to execute on our operating model,” Nemeth stated. “We are excited about the opportunities in front of us and look forward to continuing to drive growth and value through the disciplined execution of our capital allocation strategy.”
“For the remainder of 2018, in anticipation of continued strong retail demand in all of our core markets, we remain focused on continuing to drive strong operating improvement, performance, and results,” Cleveland stated. “The capital capacity and flexibility provided by our recent credit facility expansion provides us with a strong financial foundation and, when combined with the exceptional commitment and dedication of our 7,000+ team members, well positions us to focus on the execution of our strategic plan and further drive shareholder value.”
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