ELKHART, Ind., Feb. 16, 2017 /PRNewswire/ -- Patrick
Industries, Inc. (NASDAQ: PATK), a major manufacturer and
distributor of building and component products for the recreational
vehicle ("RV"), manufactured housing ("MH") and industrial markets,
today reported its financial results for the fourth quarter and
full year ended December 31,
2016.
Fourth Quarter 2016 Financial Results
Net sales for the fourth quarter of 2016 increased $75.2 million or 30%, to $323.9 million from $248.7
million in the same quarter of 2015. The increase was
primarily attributable to a 29% increase in the Company's revenue
from the RV industry, which reflected the incremental contribution
from acquisitions completed in 2015 and 2016 and industry
growth. According to industry sources, RV industry wholesale
unit shipments increased approximately 19% in the fourth quarter of
2016 compared to the prior year. Sales to the RV industry
represented 74% of the Company's fourth quarter 2016 sales.
Revenue from the MH industry, which represented 14% of the
Company's fourth quarter 2016 sales, increased 28%. According
to industry sources, wholesale unit shipments in the MH industry
rose approximately 15% from the fourth quarter of 2015.
Additionally, sales to the industrial markets increased 40%
compared to the prior year period. The industrial market
sector, which is tied primarily to residential housing and
non-residential construction spending, accounted for 12% of the
Company's fourth quarter 2016 sales. New housing starts in the
fourth quarter of 2016 increased approximately 9% compared to the
prior year.
For the fourth quarter of 2016, Patrick reported operating
income of $22.1 million, an increase
of 18% or $3.3 million, from the
$18.8 million reported in the fourth
quarter of 2015. Net income in the fourth quarter of 2016
increased 13% to $13.6 million from
$12.0 million in the fourth quarter
of 2015, while net income per diluted share increased 14% to
$0.89 from $0.78.
Todd Cleveland, Chief Executive
Officer, said, "Our fourth quarter revenues were in line with the
strong seasonal demand patterns in the RV and MH industries as well
as continued penetration into the industrial market. We were
able to grow both our top and bottom line and successfully execute
on our strategic and operational initiatives, which included the
acquisitions of Sigma Wire International, LLC and KRA
International, LLC in December 2016,
investing in our strategic capital expenditure program, and our
continued expansion plans in certain customer-concentrated regions
of the country. Additionally, we increased our overall content per
unit in both the RV and MH industries and remain optimistic about
the long-term growth potential in these industries as well as the
industrial market."
"In terms of wholesale unit shipments, the RV market experienced
the best fourth quarter and the highest level of annual shipments
in more than 40 years," stated Andy
Nemeth, President. "Retail sales of towable and
motorized units, on a combined basis, grew 10% in 2016 based on
industry data. Demand in this market continues to expand, supported
by favorable demographic trends and we continued our focus on
positioning ourselves to be able to fully support our customer base
with resources and capacity."
Full Year 2016 Financial Results
Net sales for 2016 increased $301.6
million or 33%, to $1.2
billion from $920.3 million in
2015. The Company's revenue from the RV industry, which
represented 75% of its 2016 sales, increased 32%. According
to industry sources, RV industry wholesale unit shipments increased
approximately 15% in 2016 compared to the prior year.
Additionally, revenue from the MH industry, which represented 13%
of the Company's full year 2016 sales, rose 26% compared to the
prior year as MH wholesale unit shipments increased by
approximately 15%. Revenue from the industrial market
increased 44% and benefited primarily from acquisitions and market
share gains. The industrial market, which accounted for 12% of the
Company's 2016 sales, saw new housing starts increase by
approximately 5% for 2016 compared to the prior year. The
Company estimates that approximately 50% of its industrial market
sales are linked to the residential housing sector and its sales to
the industrial markets generally lag new housing starts by
approximately six to nine months.
The Company's RV content per unit for the full year 2016
increased 15% to $2,126 from
$1,845 in 2015. The Company's MH
content per unit for the full year 2016 increased 8% to
$1,966 from $1,825 in 2015.
For 2016, Patrick reported operating income of $90.8 million, an increase of $20.9 million or 30%, from the $69.9 million reported in 2015. Net income
in 2016 increased 32% to $55.6
million from $42.2 million in
2015, while net income per diluted share increased 34% to
$3.64 from $2.72.
In the fourth quarter of 2016, the Company adopted a new
accounting standard related to employee share-based payments that
requires excess tax benefits and deficiencies resulting from the
vesting or exercise of such payments be recognized in the Company's
income tax provision rather than in additional paid-in capital.
Adoption of the new standard requires a retroactive adjustment to
the Company's income tax provision previously reported for the
first nine months of 2016. As a result of this adjustment,
the Company's previously reported nine months 2016 net income and
net income per diluted share were increased by $1.3 million and $0.06, respectively, and such increases are
reflected in the full year 2016 reported net income and net income
per diluted share amounts. The adoption of this standard had
no impact on reported net income and net income per diluted share
for the fourth quarter of 2016.
The Company invested approximately $159.5
million, in the aggregate, for acquisitions, capital
expenditures and stock repurchases in 2016, while total debt, net
of cash on hand, increased $62.3
million to $266.1 million at
December 31, 2016 from $203.8 million at December 31, 2015.
Patrick's total assets increased $153.4
million to $535.0 million at
December 31, 2016 from $381.6 million at December 31, 2015,
primarily reflecting the addition of acquisition-related assets and
overall growth.
In 2016, the Company repurchased 120,738 shares, in the
aggregate, of its common stock at an average price of $43.18 for a total cost of $5.2 million under its stock buyback
programs.
"Overall, we are pleased with our full year 2016 performance as
our net sales exceeded $1.2 billion,"
Mr. Nemeth further commented. "We were able to successfully
integrate the acquisition of eight companies during the year, make
strategic investments into our manufacturing facilities, and expand
our geographic footprint in line with key customer capacity
expansions, all in alignment with our strategic plan. Consumer
optimism and confidence are strong and are aligned with our
expectations as we seek to position the Company to aggressively
continue to execute on our initiatives and maximize the potential
of the markets we serve."
"Looking ahead, we are well-positioned to run parallel with our
customers as they expand their operations in anticipation of
continued expected growth into 2017. With the ongoing
focus on our organizational strategic agenda, the dedication of our
over 4,800 talented team members, and the support of all of our
business partners, we look forward to continuing to serve our
customer base, bring new, innovative products to the marketplace in
the primary industries we serve, and further drive shareholder
value in 2017," stated Mr. Cleveland.
Conference Call Webcast
As previously announced, Patrick Industries will host an online
webcast of its fourth quarter 2016 earnings conference call that
can be accessed on the Company's website, www.patrickind.com, under
"Investor Relations," on Thursday, February
16, 2017 at 10:00 a.m. Eastern
time.
About Patrick Industries
Patrick Industries, Inc. (www.patrickind.com) is a major
manufacturer of component products and distributor of building
products serving the recreational vehicle, manufactured housing,
kitchen cabinet, office and household furniture, fixtures and
commercial furnishings, marine, and other industrial markets and
operates coast-to-coast through locations in 16 states.
Patrick's major manufactured products include decorative vinyl and
paper laminated panels, countertops, fabricated aluminum products,
wrapped profile mouldings, slide-out trim and fascia, cabinet doors
and components, hardwood furniture, fiberglass bath fixtures,
fiberglass and plastic component products, softwoods lumber,
interior passage doors, RV painting, and slotwall panels and
components. The Company also distributes drywall and drywall
finishing products, electronics and audio systems components,
wiring, electrical and plumbing products, cement siding, raw and
processed lumber, FRP products, interior passage doors, roofing
products, laminate and ceramic flooring, shower doors, furniture,
fireplaces and surrounds, interior and exterior lighting products,
and other miscellaneous products.
Forward-Looking Statements
This press release contains certain statements related to future
results, our intentions, beliefs and expectations or predictions
for the future, which are forward-looking statements as that term
is defined in the Private Securities Litigation Reform Act of
1995. These forward-looking statements involve a number of
risks and uncertainties that could cause actual results to differ
materially from either historical or anticipated results depending
on a variety of factors. Potential factors that could impact
results include: the impact of any economic downturns especially in
the residential housing market, a decline in consumer confidence
levels, pricing pressures due to competition, costs and
availability of raw materials, the imposition of restrictions and
taxes on imports of raw materials and components used in our
products, information technology performance and security, the
availability of commercial credit, the availability of retail and
wholesale financing for residential and manufactured homes, the
availability and costs of labor, inventory levels of retailers and
manufacturers, the financial condition of our customers, retention
and concentration of significant customers, the ability to generate
cash flow or obtain financing to fund growth, future growth rates
in the Company's core businesses, the seasonality and cyclicality
in the industries to which our products are sold, realization and
impact of efficiency improvements and cost reductions, the
successful integration of acquisitions and other growth
initiatives, increases in interest rates and oil and gasoline
prices, adverse weather conditions impacting retail sales, our
ability to remain in compliance with our credit agreement
covenants, and general economic, market and political conditions.
In addition, national and regional economic conditions may affect
the retail sale of recreational vehicles and residential and
manufactured housing. The Company does not undertake to
update forward-looking statements, except as required by law.
Further information regarding these and other risks, uncertainties
and factors is contained in the section entitled "Risk Factors" in
the Company's Annual Report on Form 10-K for the year ended
December 31, 2015, and in the
Company's Form 10-Qs for subsequent quarterly periods, which are
filed with the Securities and Exchange Commission ("SEC") and are
available on the SEC's website at www.sec.gov.
PATRICK
INDUSTRIES, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fourth Quarter
Ended
|
|
Twelve Months
Ended
|
|
|
|
|
(thousands except per
share data)
|
Dec. 31,
2016
|
|
Dec. 31,
2015
|
|
Dec. 31,
2016
|
|
Dec. 31,
2015
|
|
|
|
|
|
|
|
|
NET
SALES
|
$
|
323,936
|
|
|
$
|
248,659
|
|
|
$
|
1,221,887
|
|
|
$
|
920,333
|
|
Cost of goods
sold
|
270,955
|
|
|
207,208
|
|
|
1,019,418
|
|
|
768,054
|
|
GROSS PROFIT
|
52,981
|
|
|
41,451
|
|
|
202,469
|
|
|
152,279
|
|
|
|
|
|
|
|
|
|
Operating
Expenses:
|
|
|
|
|
|
|
|
Warehouse and
delivery
|
9,932
|
|
|
6,952
|
|
|
36,081
|
|
|
27,106
|
|
Selling, general and
administrative
|
17,262
|
|
|
12,925
|
|
|
62,183
|
|
|
46,468
|
|
Amortization of intangible
assets
|
3,688
|
|
|
2,792
|
|
|
13,368
|
|
|
8,787
|
|
Total operating expenses
|
30,882
|
|
|
22,669
|
|
|
111,632
|
|
|
82,361
|
|
|
|
|
|
|
|
|
|
OPERATING
INCOME
|
22,099
|
|
|
18,782
|
|
|
90,837
|
|
|
69,918
|
|
Interest expense,
net
|
1,987
|
|
|
1,464
|
|
|
7,185
|
|
|
4,319
|
|
Income
before income taxes
|
20,112
|
|
|
17,318
|
|
|
83,652
|
|
|
65,599
|
|
Income taxes
|
6,552
|
|
|
5,282
|
|
|
28,075
|
|
|
23,380
|
|
NET
INCOME
|
$
|
13,560
|
|
|
$
|
12,036
|
|
|
$
|
55,577
|
|
|
$
|
42,219
|
|
|
|
|
|
|
|
|
|
BASIC NET INCOME
PER COMMON SHARE
|
$
|
0.90
|
|
|
$
|
0.79
|
|
|
$
|
3.70
|
|
|
$
|
2.76
|
|
DILUTED NET INCOME
PER COMMON SHARE
|
$
|
0.89
|
|
|
$
|
0.78
|
|
|
$
|
3.64
|
|
|
$
|
2.72
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding - Basic
|
15,043
|
|
|
15,314
|
|
|
15,013
|
|
|
15,323
|
|
Weighted average
shares outstanding - Diluted
|
15,317
|
|
|
15,494
|
|
|
15,264
|
|
|
15,503
|
|
PATRICK
INDUSTRIES, INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Unaudited)
|
|
|
|
|
|
|
|
|
|
As of
|
(thousands)
|
Dec. 31,
2016
|
|
Dec. 31,
2015
|
ASSETS
|
|
|
|
Current
Assets
|
|
|
|
Cash and cash
equivalents
|
$
|
6,449
|
|
|
$
|
87
|
|
Trade receivables,
net
|
38,455
|
|
|
38,213
|
|
Inventories
|
120,019
|
|
|
89,478
|
|
Prepaid expenses and
other
|
7,846
|
|
|
6,119
|
|
Total current assets
|
172,769
|
|
|
133,897
|
|
Property, plant
and equipment, net
|
85,483
|
|
|
67,878
|
|
Goodwill and
other intangible assets, net
|
274,432
|
|
|
175,365
|
|
Deferred
financing costs, net
|
1,728
|
|
|
1,885
|
|
Deferred tax
assets, net
|
—
|
|
|
2,004
|
|
Other
non-current assets
|
538
|
|
|
555
|
|
TOTAL ASSETS
|
$
|
534,950
|
|
|
$
|
381,584
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
Current
Liabilities
|
|
|
|
Current maturities of
long-term debt
|
$
|
15,766
|
|
|
$
|
10,714
|
|
Accounts payable
|
46,752
|
|
|
28,744
|
|
Accrued
liabilities
|
23,575
|
|
|
18,468
|
|
Total current liabilities
|
86,093
|
|
|
57,926
|
|
Long-term debt,
less current maturities, net
|
256,811
|
|
|
193,142
|
|
Deferred tax
liabilities, net
|
4,988
|
|
|
—
|
|
Deferred
compensation and other
|
1,610
|
|
|
1,919
|
|
TOTAL LIABILITIES
|
349,502
|
|
|
252,987
|
|
|
|
|
|
SHAREHOLDERS' EQUITY
|
|
|
|
Common
stock
|
63,716
|
|
|
57,683
|
|
Additional
paid-in-capital
|
8,243
|
|
|
8,308
|
|
Accumulated
other comprehensive income
|
27
|
|
|
32
|
|
Retained
earnings
|
113,462
|
|
|
62,574
|
|
TOTAL SHAREHOLDERS' EQUITY
|
185,448
|
|
|
128,597
|
|
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
534,950
|
|
|
$
|
381,584
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/patrick-industries-inc-reports-fourth-quarter-and-full-year-2016-financial-results-300408777.html
SOURCE Patrick Industries, Inc.