Elkhart, Ind.-based Patrick Industries Inc., a supplier of component products for the recreational vehicle, manufactured housing, and industrial markets, reported a 28.3% increase in revenue for its third quarter, ended Sept. 28, boosted by strong performance in the RV sector.
Net sales for the third quarter increased $41.5 million to $188.1 million from $146.6 million in the same quarter of 2013. The increase was primarily attributable to a 34% increase in the company’s revenue from the RV industry, which represented 73% of the Patrick’s third-quarter sales. Revenue from the MH industry increased 12% from the prior year period, while revenue from the industrial market increased 19%.
Third-quarter net income was $7.3 million, or 68 cents per diluted share, compared to net income of $5.5 million, or 51 cents per diluted share, the previous year.
The company estimates its organic growth in the third quarter of 2014 at approximately 7%, or $10.2 million of its total revenue increase. The remaining $31.3 million of the revenue increase in the third quarter of 2014 reflects the contribution of the acquisitions completed in 2013 and 2014. As previously announced, the company acquired the business and certain assets of PolyDyn3 LLC in September 2014, and of Precision Painting Inc., Carrera Custom Painting Inc., Millennium Paint Inc., and TDM Transport, Inc. (collectively, “Precision”) and Foremost Fabricators LLC in June 2014.
The company’s RV content per unit (on a trailing 12-month basis) for the third quarter of 2014 increased approximately 17% to $1,488 from $1,271 for the comparable period in 2013. The estimated MH content per unit (on a trailing twelve-month basis) for the third quarter of 2014 increased to $1,619 from $1,599 for the comparable period in 2013.
President and CEO Todd Cleveland said, “We are pleased with our third-quarter revenue growth which continues to be supported by our acquisition initiatives, our focus on bringing value added products to our customer base, and growth in all three of the end markets we serve. Our gross margin improved in the third quarter compared to the prior year period primarily reflecting contributions from increased volumes and acquisitions, as well as our disciplined cost control and management of certain low margin business. We have added capacity where appropriate in advance of projected demand, ensuring that we are positioned to fulfill our customers’ orders on a timely basis, and continue to leverage our fixed costs over our sales base.”
Net sales for the first nine months of 2014 increased $97.8 million, or 21.8%, to $546.1 million from $448.3 million in the same period in 2013. For the first nine months of 2014, the company’s revenue from the RV industry, which represented 75% of its nine months 2014 sales, increased by 24%. Revenue from the MH industry, which represented 14% of the company’s nine months 2014 sales, rose 10% compared to the prior year while sales from the industrial market increased 22%
Nine months 2014 net income was $23.4 million, or $2.18 per diluted share, compared to net income of $19 million, or $1.76 per diluted share, in the first nine months of 2013. Patrick reported operating income during the period of $39.8 million, an increase of $7.5 million or 23.1%, from the $32.3 million reported in the first nine months of 2013.
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