Patrick Industries Inc., a key manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets, reported strong earnings and revenue gains for its fourth quarter and full year.
Net sales for the fourth quarter of 2014 increased $43.0 million or 29.3%, to $189.6 million from $146.6 million in the same quarter of 2013. Revenue from the RV industry, which represented 74% of the company’s fourth-quarter 2014 sales, increased 36%. Fourth-quarter net income was $7.3 million, or 69 cents per diluted share, compared to net income of $5 million, or 47 cents per diluted share, in the fourth quarter of 2013.
The company estimates its organic growth in the fourth quarter of 2014 at approximately 13%, or $19.7 million, of its total revenue increase. The remaining $23.3 million of the revenue increase in the fourth quarter of 2014 reflects the contribution of the four acquisitions completed in 2014: Charleston Corp. in November 2014; Precision Painting Inc., Carrera Custom Painting Inc., Millennium Paint Inc., and TDM Transport Inc. (collectively, “Precision”) in June 2014; Foremost Fabricators LLC in June 2014; and PolyDyn3 LLC in September 2014. In addition, as recently announced, the company acquired the business and certain assets of Better Way Partners,LLC d/b/a Better Way Products.
Patrick reported operating income of $11.7 million in the fourth quarter of 2014, an increase of $3.1 million or 35.4%, from the $8.6 million reported in the fourth quarter of 2013.
Full Year 2014 Financial Results
Net sales for the 12 months of 2014 increased $140.8 million. or 23.7%, to $735.7 million from $594.9 million in 2013. Revenue from the RV industry, which represented 74% of 2014 sales, increased by 27% compared to the prior year as RV wholesale unit shipments increased by approximately 11%. Twelve-month net income was $30.7 million, or $2.87 per diluted share, compared to net income of $24.0 million, or $2.23 per diluted share, in 2013.
The Company estimates its organic growth in 2014 at approximately 11%, or $62.8 million, of its total revenue increase. The remaining $78.0 million of the revenue increase reflects the contribution of the 2014 acquisitions as well as the incremental contribution of acquisitions completed in 2013.
The Company’s RV content per unit for the full year 2014 increased approximately 15% to $1,536 from $1,338 in 2013. The MH content per unit for 2014 increased approximately 7% to $1,692 from $1,582 in 2013.
For the full year 2014, Patrick reported operating income of $51.5 million, an increase of $10.5 million or 25.7%, from the $41.0 million reported in the prior year.
Patrick noted that the company repurchased 172,021 shares of its common stock at an average price of $40.69 per share for a total cost of approximately $7.0 million during 2014. In addition , on Feb. 17 the company’s board authorized an increase in the amount common stock that may be acquired under the stock buyback program over the next 12 months to $20.0 million.
Todd Cleveland, President and CEO, said, “Our fourth quarter and full-year 2014 revenue and profitability growth, coupled with the benefits realized from the achievement of our strategic and operational initiatives executed in 2013 and 2014 and the growth experienced in all three of the end markets we serve, resulted in a strong fiscal 2014 for Patrick Industries. Our team’s focus on driving ourselves to exceed customer expectations, as well as on product development and the acquisition of related businesses and products, provided us with the opportunities to continue to better serve our customer base.
“As we look forward to 2015, we are excited about the opportunities to further penetrate our markets, increase market share, and continue to grow our business. We are anticipating the continuation of steady growth in all three of our primary markets. In addition, we believe that the businesses we acquired in 2013 and 2014, as well as our most recent acquisition of Better Way, are well positioned to expand their customer set, enhance their brands, and grow profitably.”