LCI Industries today (Feb. 9) reported consolidated net sales in the fourth quarter of 2016 of $403 million, 21% higher than the prior year’s net sales of $334 million. Net income was $26.3 million, or $1.05 per diluted share, for the fourth quarter, ended Dec. 31, compared to net income of $16.1 million, or 65 cents per diluted share, the previous year.
The increase in year-over-year net sales reflects industrywide growth in wholesale shipments of towable and motorized RVs by OEMs, which increased 20% and 16%, respectively, enhanced by acquisitions completed by the LCI in 2016, which added $17 million in fourth-quarter net sales. Through continued focus on aftermarket channels for the company’s products, net sales to the aftermarket in the fourth quarter increased by more than 16% to $30 million.
“2016 RV industry volume outpaced 2015 each quarter, as 2016 fourth-quarter wholesale travel trailers were up nearly 24% and fifth-wheels were up over 10%,” stated LCI CEO Jason Lippert. “Travel trailer sales momentum has continued as the industry attracts a new generation of RV enthusiasts. We are also pleased to see that fifth-wheel wholesale units increased approximately 1,900 units in the fourth quarter of 2016 and 5,400 units for the full year.”
For the full year, sales increased to a record $1.7 billion, 20% higher than $1.4 billion in the prior year. Net income for the full-year 2016 increased to $129.7 million, or $5.20 per diluted share, up from net income of $74.3 million, or $3.02 per diluted share, in 2015.
A 15% increase in industrywide wholesale shipments of travel trailer and fifth-wheel RVs, LCI’s primary OEM market, as well as increased content per RV unit, positively impacted net sales growth in 2016. Acquisitions completed by the company in 2016 added $64 million in sales while LCI organically increased sales to adjacent industries and the aftermarket.
The company’s content per travel trailer and fifth-wheel RV for the 12 months increased $35 to $3,022, compared to $2,987 a year ago. LCI’s content per motorhome RV for the 12 months increased $201, to $2,011, compared to $1,810 a year ago. The content increases are a combined result of organic growth, including new product introductions, as well as acquisitions and changes in the types of RVs produced industrywide.
Based on the retail sales strength experienced through 2016 and the current outlook from several RV OEMs and their dealer networks, RV OEMs have reported sale order backlogs at record levels.
In January 2017, LCI’s consolidated net sales reached approximately $149 million, 18% higher than January 2016. “As the industry prepares to meet the anticipated demand of the 2017 spring and summer selling seasons, I am encouraged by January sales following up on a strong fourth quarter,” said Lippert.
“Our operating profit in the fourth quarter of 2016 improved to $40.6 million, compared to $23.6 million in the fourth quarter of 2015,” said LCI President Scott Mereness. “Strong industry growth, lower costs for certain key commodities, accretive acquisitions completed over 2016 and a focus on cost management, lean initiatives and other operational efficiencies, all contributed to profit improvement for the quarter.”
Lippert concluded, “We have built an organization with the best people and created a culture with core values that focus on meeting the challenge of providing value to our customers every day. We will continue our efforts to develop, engineer and build great products, as well as improving our service to all customer channels, so that each day we are the supplier of choice for the industries we serve. Additionally, we will continue to seek expansion with new and innovative products, new customers, new markets and new geographies.”