LCI Industries Reports Second Quarter Financial Results
LCI Industries reported impressive second quarter 2022 results with net sales reaching $1.5 billion, a 40% increase year-over-year. Net income surged to $154.5 million or $6.06 per diluted share, up 128%. EBITDA improved significantly to $250.7 million, reflecting a 108% growth. Key drivers included price realization, market share gains, and increased wholesale shipments. The average product content per RV rose to a record $5,382, while net sales in July 2022 remained positive at approximately $368.4 million, up 5% from the previous year.
- Net sales for Q2 2022 reached $1.5 billion, up 40% year-over-year.
- Net income increased 128% to $154.5 million, or $6.06 per diluted share.
- EBITDA grew by 108% to $250.7 million.
- Increased average product content per RV to a record $5,382, up 49% year-over-year.
- July 2022 net sales were approximately $368.4 million, up 5% from July 2021.
- Effective tax rate increased to 27.3% from 25.0% year-over-year.
- Cash and cash equivalents decreased to $55.0 million from $62.9 million.
Executing on diversification strategy to drive outperformance
Second Quarter 2022 Highlights
-
Net sales of
in the second quarter, up$1.5 billion 40% year-over-year -
Net income of
, or$154.5 million per diluted share, in the second quarter, up$6.06 , or$86.6 million 128% , year-over-year -
EBITDA of
, up$250.7 million , or$130.0 million 108% , year-over-year -
Quarterly dividend of
per share paid totaling$1.05 in the second quarter$26.7 million
North American RV OEM (
-
Net sales of
in the second quarter, up$864.3 million 58% year-over-year, driven by wholesale shipments and market share gains -
Content per travel trailer and fifth-wheel RV for the twelve months ended
June 30, 2022 , increased49% year-over-year to a record$5,382
North American Adjacent Industries OEM (
-
Net sales of
in the second quarter, up$323.7 million 39% year-over-year -
North American marine OEM net sales of
, up$132.4 million 44% year-over-year -
Content per power boat for the twelve months ended
June 30, 2022 , increased71% year-over-year to a record$1,848
North American Aftermarket (
-
Net sales of
in the second quarter, up$240.2 million 14% year-over-year
International Industries (
-
Net sales of
in the second quarter, up$107.9 million 5% year-over-year
"We continued to execute on strategic priorities to deliver strong results in the second quarter, highlighted by robust revenue and EBITDA growth as we navigate a challenging operating environment. Our culture of innovation and operational excellence has supported our expansion in the Aftermarket, Marine, and RV OEM markets while assisting us to meet consumer demand for quality, technologically sophisticated products," commented
"While RV inventories stabilize, we are confident in our ability to keep driving content and market share gains both within and outside RV OEM. The widespread availability of peer-to-peer rentals, along with increasing costs of airfare and hotel lodging, have made camping, boating, and RVing attractive options for vacationing. We believe our diverse portfolio has positioned us for long-term growth as we capture tailwinds related to the ongoing popularity of the outdoor lifestyle," Lippert continued. "I am proud of the hard work shown by our teams in driving our strong performance to help us generate further shareholder value."
"I also want to thank our team members for their commitment to delivering best-in-class products to our customers. Through these efforts, we continue to drive profitable growth while solidifying LCI's position as an industry leader in the range of markets we serve," commented
Second Quarter 2022 Results
Consolidated net sales for the second quarter of 2022 were
The increase in year-over-year net sales for the second quarter of 2022 was primarily driven by price realization, market share gains, acquisitions, and increased wholesale shipments. Net sales from acquisitions completed in the twelve months ended
The Company's average product content per travel trailer and fifth-wheel RV for the twelve months ended
Income Taxes
The Company's effective tax rate was 27.3 percent for the quarter ended
Balance Sheet and Other Items
At
The Company's outstanding long-term indebtedness, including current maturities, was
Conference Call & Webcast
A replay of the conference call will be available for two weeks by dialing (929) 458-6194 for participants in the
About
Forward-Looking Statements
This press release contains certain "forward-looking statements" with respect to our financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive position, growth opportunities, acquisitions, plans and objectives of management, markets for the Company's common stock, the impact of legal proceedings, and other matters. Statements in this press release that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, and involve a number of risks and uncertainties.
Forward-looking statements, including, without limitation, those relating to our future business prospects, net sales, expenses and income (loss), capital expenditures, tax rate, cash flow, financial condition, liquidity, covenant compliance, retail and wholesale demand, integration of acquisitions, R&D investments, and industry trends, whenever they occur in this press release are necessarily estimates reflecting the best judgment of the Company's senior management at the time such statements were made. There are a number of factors, many of which are beyond the Company's control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors include, in addition to other matters described in this press release, the impacts of COVID-19, or other future pandemics, and the Russia-Ukraine War on the global economy and on the Company's customers, suppliers, employees, business and cash flows, pricing pressures due to domestic and foreign competition, costs and availability of, and tariffs on, raw materials (particularly steel and aluminum) and other components, seasonality and cyclicality in the industries to which we sell our products, availability of credit for financing the retail and wholesale purchase of products for which we sell our components, inventory levels of retail dealers and manufacturers, availability of transportation for products for which we sell our components, the financial condition of our customers, the financial condition of retail dealers of products for which we sell our components, retention and concentration of significant customers, the costs, pace of and successful integration of acquisitions and other growth initiatives, availability and costs of production facilities and labor, team member benefits, team member retention, realization and impact of expansion plans, efficiency improvements and cost reductions, the disruption of business resulting from natural disasters or other unforeseen events, the successful entry into new markets, the costs of compliance with environmental laws, laws of foreign jurisdictions in which we operate, other operational and financial risks related to conducting business internationally, and increased governmental regulation and oversight, information technology performance and security, the ability to protect intellectual property, warranty and product liability claims or product recalls, interest rates, oil and gasoline prices, and availability, the impact of international, national and regional economic conditions and consumer confidence on the retail sale of products for which we sell our components, and other risks and uncertainties discussed more fully under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended
|
||||||||||||||
OPERATING RESULTS |
||||||||||||||
(unaudited) |
||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
|
Last Twelve |
|||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
Months |
|||||
(In thousands, except per share amounts) |
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|||||
Net sales |
$ |
1,536,150 |
|
$ |
1,093,720 |
|
$ |
3,180,718 |
|
$ |
2,093,978 |
|
$ |
5,559,437 |
Cost of sales |
|
1,127,065 |
|
|
836,109 |
|
|
2,307,390 |
|
|
1,594,590 |
|
|
4,142,462 |
Gross profit |
|
409,085 |
|
|
257,611 |
|
|
873,328 |
|
|
499,388 |
|
|
1,416,975 |
Selling, general and administrative expenses |
|
190,296 |
|
|
163,629 |
|
|
384,838 |
|
|
303,975 |
|
|
725,488 |
Operating profit |
|
218,789 |
|
|
93,982 |
|
|
488,490 |
|
|
195,413 |
|
|
691,487 |
Interest expense, net |
|
6,191 |
|
|
3,472 |
|
|
12,443 |
|
|
6,177 |
|
|
22,632 |
Income before income taxes |
|
212,598 |
|
|
90,510 |
|
|
476,047 |
|
|
189,236 |
|
|
668,855 |
Provision for income taxes |
|
58,068 |
|
|
22,621 |
|
|
125,336 |
|
|
47,227 |
|
|
172,414 |
Net income |
$ |
154,530 |
|
$ |
67,889 |
|
$ |
350,711 |
|
$ |
142,009 |
|
$ |
496,441 |
|
|
|
|
|
|
|
|
|
|
|||||
Net income per common share: |
|
|
|
|
|
|
|
|
|
|||||
Basic |
$ |
6.07 |
|
$ |
2.69 |
|
$ |
13.82 |
|
$ |
5.63 |
|
$ |
19.59 |
Diluted |
$ |
6.06 |
|
$ |
2.67 |
|
$ |
13.76 |
|
$ |
5.60 |
|
$ |
19.47 |
|
|
|
|
|
|
|
|
|
|
|||||
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|||||
Basic |
|
25,438 |
|
|
25,275 |
|
|
25,377 |
|
|
25,230 |
|
|
25,340 |
Diluted |
|
25,518 |
|
|
25,385 |
|
|
25,483 |
|
|
25,351 |
|
|
25,503 |
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation |
$ |
18,010 |
|
$ |
15,412 |
|
$ |
35,964 |
|
$ |
30,597 |
|
$ |
70,122 |
Amortization |
$ |
13,897 |
|
$ |
11,342 |
|
$ |
27,755 |
|
$ |
20,673 |
|
$ |
54,646 |
Capital expenditures |
$ |
28,800 |
|
$ |
21,048 |
|
$ |
70,837 |
|
$ |
42,005 |
|
$ |
127,366 |
|
||||||||||||||
SEGMENT RESULTS |
||||||||||||||
(unaudited) |
||||||||||||||
|
Three Months Ended
|
|
Six Months Ended
|
|
Last Twelve |
|||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
Months |
|||||
(In thousands) |
|
|
|
|
|
|
|
|
|
|||||
Net sales: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment: |
|
|
|
|
|
|
|
|
|
|||||
RV OEMs: |
|
|
|
|
|
|
|
|
|
|||||
Travel trailers and fifth-wheels |
$ |
814,509 |
|
$ |
527,614 |
|
$ |
1,767,735 |
|
$ |
1,030,630 |
|
$ |
3,032,717 |
Motorhomes |
|
91,480 |
|
|
67,253 |
|
|
178,734 |
|
|
129,846 |
|
|
307,883 |
Adjacent Industries OEMs |
|
370,289 |
|
|
269,787 |
|
|
726,391 |
|
|
520,428 |
|
|
1,294,968 |
Total OEM Segment net sales |
|
1,276,278 |
|
|
864,654 |
|
|
2,672,860 |
|
|
1,680,904 |
|
|
4,635,568 |
Aftermarket Segment: |
|
|
|
|
|
|
|
|
|
|||||
Total Aftermarket Segment net sales |
|
259,872 |
|
|
229,066 |
|
|
507,858 |
|
|
413,074 |
|
|
923,869 |
Total net sales |
$ |
1,536,150 |
|
$ |
1,093,720 |
|
$ |
3,180,718 |
|
$ |
2,093,978 |
|
$ |
5,559,437 |
|
|
|
|
|
|
|
|
|
|
|||||
Operating profit: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment |
$ |
190,577 |
|
$ |
63,334 |
|
$ |
435,951 |
|
$ |
142,621 |
|
$ |
598,006 |
Aftermarket Segment |
|
28,212 |
|
|
30,648 |
|
|
52,539 |
|
|
52,792 |
|
|
93,481 |
Total operating profit |
$ |
218,789 |
|
$ |
93,982 |
|
$ |
488,490 |
|
$ |
195,413 |
|
$ |
691,487 |
|
|
|
|
|
|
|
|
|
|
|||||
Depreciation and amortization: |
|
|
|
|
|
|
|
|
|
|||||
OEM Segment depreciation |
$ |
14,376 |
|
$ |
12,081 |
|
$ |
28,878 |
|
$ |
24,768 |
|
$ |
55,449 |
Aftermarket Segment depreciation |
|
3,634 |
|
|
3,331 |
|
|
7,086 |
|
|
5,829 |
|
|
14,673 |
Total depreciation |
$ |
18,010 |
|
$ |
15,412 |
|
$ |
35,964 |
|
$ |
30,597 |
|
$ |
70,122 |
|
|
|
|
|
|
|
|
|
|
|||||
OEM Segment amortization |
$ |
10,053 |
|
$ |
7,806 |
|
$ |
20,197 |
|
$ |
14,258 |
|
$ |
38,832 |
Aftermarket Segment amortization |
|
3,844 |
|
|
3,536 |
|
|
7,558 |
|
|
6,415 |
|
|
15,814 |
Total amortization |
$ |
13,897 |
|
$ |
11,342 |
|
$ |
27,755 |
|
$ |
20,673 |
|
$ |
54,646 |
|
|||||
BALANCE SHEET INFORMATION |
|||||
(unaudited) |
|||||
|
|
|
|
||
|
2022 |
|
2021 |
||
(In thousands) |
|
|
|
||
|
|
|
|
||
ASSETS |
|
|
|
||
Current assets |
|
|
|
||
Cash and cash equivalents |
$ |
54,988 |
|
$ |
62,896 |
Accounts receivable, net |
|
417,033 |
|
|
319,782 |
Inventories, net |
|
1,155,171 |
|
|
1,095,907 |
Prepaid expenses and other current assets |
|
70,510 |
|
|
88,300 |
Total current assets |
|
1,697,702 |
|
|
1,566,885 |
Fixed assets, net |
|
456,517 |
|
|
426,455 |
|
|
554,828 |
|
|
543,180 |
Other intangible assets, net |
|
512,752 |
|
|
519,957 |
Operating lease right-of-use assets |
|
203,221 |
|
|
164,618 |
Other long-term assets |
|
57,676 |
|
|
66,999 |
Total assets |
$ |
3,482,696 |
|
$ |
3,288,094 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
||
Current liabilities |
|
|
|
||
Current maturities of long-term indebtedness |
$ |
20,979 |
|
$ |
71,003 |
Accounts payable, trade |
|
287,659 |
|
|
282,183 |
Current portion of operating lease obligations |
|
34,167 |
|
|
30,592 |
Accrued expenses and other current liabilities |
|
295,438 |
|
|
243,438 |
Total current liabilities |
|
638,243 |
|
|
627,216 |
Long-term indebtedness |
|
1,101,787 |
|
|
1,231,959 |
Operating lease obligations |
|
179,854 |
|
|
143,436 |
Deferred taxes |
|
28,376 |
|
|
43,184 |
Other long-term liabilities |
|
140,079 |
|
|
149,424 |
Total liabilities |
|
2,088,339 |
|
|
2,195,219 |
Total stockholders' equity |
|
1,394,357 |
|
|
1,092,875 |
Total liabilities and stockholders' equity |
$ |
3,482,696 |
|
$ |
3,288,094 |
|
|||||||
SUMMARY OF CASH FLOWS |
|||||||
(unaudited) |
|||||||
|
Six Months Ended
|
||||||
|
2022 |
|
2021 |
||||
(In thousands) |
|
|
|
||||
Cash flows from operating activities: |
|
|
|
||||
Net income |
$ |
350,711 |
|
|
$ |
142,009 |
|
Adjustments to reconcile net income to cash flows provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
63,719 |
|
|
|
51,270 |
|
Stock-based compensation expense |
|
13,701 |
|
|
|
13,859 |
|
Deferred taxes |
|
(2,401 |
) |
|
|
— |
|
Other non-cash items |
|
2,025 |
|
|
|
4,305 |
|
Changes in assets and liabilities, net of acquisitions of businesses: |
|
|
|
||||
Accounts receivable, net |
|
(95,479 |
) |
|
|
(142,489 |
) |
Inventories, net |
|
(51,811 |
) |
|
|
(115,314 |
) |
Prepaid expenses and other assets |
|
25,746 |
|
|
|
(16,401 |
) |
Accounts payable, trade |
|
5,312 |
|
|
|
71,144 |
|
Accrued expenses and other liabilities |
|
36,448 |
|
|
|
15,476 |
|
Net cash flows provided by operating activities |
|
347,971 |
|
|
|
23,859 |
|
Cash flows from investing activities: |
|
|
|
||||
Capital expenditures |
|
(70,837 |
) |
|
|
(42,005 |
) |
Acquisitions of businesses |
|
(51,789 |
) |
|
|
(103,858 |
) |
Other investing activities |
|
2,204 |
|
|
|
(566 |
) |
Net cash flows used in investing activities |
|
(120,422 |
) |
|
|
(146,429 |
) |
Cash flows from financing activities: |
|
|
|
||||
Vesting of stock-based awards, net of shares tendered for payment of taxes |
|
(10,773 |
) |
|
|
(7,925 |
) |
Proceeds from revolving credit facility |
|
729,400 |
|
|
|
554,693 |
|
Repayments under revolving credit facility |
|
(836,500 |
) |
|
|
(719,747 |
) |
Repayments under shelf loan, term loan, and other borrowings |
|
(60,902 |
) |
|
|
(8,652 |
) |
Proceeds from issuance of convertible notes |
|
— |
|
|
|
460,000 |
|
Purchases of convertible note hedge contracts |
|
— |
|
|
|
(100,142 |
) |
Proceeds from issuance of warrants concurrent with note hedge contracts |
|
— |
|
|
|
48,484 |
|
Payment of debt issuance costs |
|
(4 |
) |
|
|
(11,844 |
) |
Payment of dividends |
|
(49,572 |
) |
|
|
(41,678 |
) |
Payment of contingent consideration and holdbacks related to acquisitions |
|
(6,039 |
) |
|
|
(4,387 |
) |
Net cash flows (used in) provided by financing activities |
|
(234,390 |
) |
|
|
168,802 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
(1,067 |
) |
|
|
(92 |
) |
Net (decrease) increase in cash and cash equivalents |
|
(7,908 |
) |
|
|
46,140 |
|
Cash and cash equivalents at beginning of period |
|
62,896 |
|
|
|
51,821 |
|
Cash and cash equivalents cash at end of period |
$ |
54,988 |
|
|
$ |
97,961 |
|
|
|||||||||||||||
SUPPLEMENTARY INFORMATION |
|||||||||||||||
(unaudited) |
|||||||||||||||
|
Three Months Ended |
|
Six Months Ended |
|
|
|
|||||||||
|
|
|
|
|
Last Twelve |
|
|||||||||
|
2022 |
|
2021 |
|
2022 |
|
2021 |
|
Months |
|
|||||
Industry Data(1) (in thousands of units): |
|
|
|
|
|
|
|
|
|
|
|||||
Industry Wholesale Production: |
|
|
|
|
|
|
|
|
|
|
|||||
Travel trailer and fifth-wheel RVs |
133.7 |
|
133.8 |
|
|
|
285.9 |
|
|
265.0 |
|
|
|
552.3 |
|
Motorhome RVs |
14.8 |
|
14.8 |
|
|
|
30.6 |
|
|
29.1 |
|
|
|
57.6 |
|
Industry Retail Sales: |
|
|
|
|
|
|
|
|
|
|
|||||
Travel trailer and fifth-wheel RVs |
125.6 |
(2) |
180.5 |
|
|
|
218.7 |
(2) |
|
295.0 |
|
|
|
426.0 |
(2) |
Impact on dealer inventories |
8.1 |
(2) |
(46.7 |
) |
|
|
67.2 |
(2) |
|
(30.0 |
) |
|
|
126.3 |
(2) |
Motorhome RVs |
14.0 |
(2) |
17.0 |
|
|
|
26.9 |
(2) |
|
30.3 |
|
|
|
51.9 |
(2) |
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
Twelve Months Ended |
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
2022 |
|
2021 |
|
|
|
|||||
Lippert Content Per Industry Unit Produced: |
|
|
|
|
|
|
|
||||||||
Travel trailer and fifth-wheel RV |
|
|
|
|
$ |
5,382 |
|
$ |
3,621 |
|
|
|
|
||
Motorhome RV |
|
|
|
|
$ |
3,569 |
|
$ |
2,644 |
|
|
|
|
||
|
|
|
|
|
|
|
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2022 |
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2021 |
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2021 |
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Balance Sheet Data (debt availability in millions): |
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Remaining availability under the revolving credit facility (3) |
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$ |
286.7 |
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$ |
372.6 |
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$ |
168.3 |
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Days sale in accounts receivable, based on last twelve months |
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28.2 |
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31.3 |
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30.6 |
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Inventory turns, based on last twelve months |
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4.3 |
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6.1 |
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5.0 |
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2022 |
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Estimated Full Year Data: |
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Capital expenditures |
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Depreciation and amortization |
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Stock-based compensation expense |
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Annual tax rate |
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(1) Industry wholesale production data for travel trailer and fifth-wheel RVs and motorhome RVs provided by the
(2)
(3) Remaining availability under the revolving credit facility is subject to covenant restrictions.
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SUPPLEMENTARY INFORMATION |
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RECONCILIATION OF NON-GAAP MEASURES |
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(unaudited) |
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The following table reconciles net income to EBITDA. |
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Three Months Ended |
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Six Months Ended |
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2022 |
|
2021 |
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2022 |
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2021 |
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(In thousands) |
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Net income |
$ |
154,530 |
|
$ |
67,889 |
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$ |
350,711 |
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$ |
142,009 |
Interest expense, net |
|
6,191 |
|
|
3,472 |
|
|
12,443 |
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|
6,177 |
Provision for income taxes |
|
58,068 |
|
|
22,621 |
|
|
125,336 |
|
|
47,227 |
Depreciation expense |
|
18,010 |
|
|
15,412 |
|
|
35,964 |
|
|
30,597 |
Amortization expense |
|
13,897 |
|
|
11,342 |
|
|
27,755 |
|
|
20,673 |
EBITDA |
$ |
250,696 |
|
$ |
120,736 |
|
$ |
552,209 |
|
$ |
246,683 |
In addition to reporting financial results in accordance with
View source version on businesswire.com: https://www.businesswire.com/news/home/20220802005196/en/
(574) 535-1125
LCII@lci1.com
Source:
FAQ
What were the net sales for LCI Industries in Q2 2022?
How much did LCI Industries earn per share in Q2 2022?
What was LCI Industries' EBITDA for the second quarter of 2022?
How did July 2022 sales figures compare to July 2021 for LCI Industries?