0000763744FALSE00007637442024-11-072024-11-07

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 7, 2024
LCI INDUSTRIES
(Exact name of registrant as specified in its charter)
Delaware001-1364613-3250533
(State or other jurisdiction of incorporation)(Commission File Number)(I.R.S. Employer
Identification No.)
3501 County Road 6 East, Elkhart,Indiana46514
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code:(574)535-1125
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $.01 par valueLCIINew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02    Results of Operations and Financial Condition

On November 7, 2024, LCI Industries issued a press release setting forth LCI Industries' third quarter 2024 results. A copy of the press release is attached hereto as Exhibit 99.1.

An investor presentation that LCI Industries will refer to during its conference call to discuss the results is attached hereto as Exhibit 99.2 and will be posted on LCI Industries' investor relations website in advance of the call.

The foregoing information is furnished pursuant to Item 2.02, "Results of Operations and Financial Condition." Such information, including the Exhibits attached hereto, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits

Exhibit Index:
Press Release dated November 7, 2024
Investor Presentation dated November 7, 2024
104Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

LCI INDUSTRIES
(Registrant)

By: /s/ Lillian D. Etzkorn
Lillian D. Etzkorn
Chief Financial Officer

Dated: November 7, 2024



    Exhibit 99.1
FOR IMMEDIATE RELEASE
lcii.jpg
Contact: Lillian D. Etzkorn, CFO
Phone: (574) 535-1125
E Mail: LCII@lci1.com

LCI INDUSTRIES REPORTS THIRD QUARTER FINANCIAL RESULTS
Strong operating performance and cash flow generation in challenging environment


Third Quarter 2024 Highlights
•Net sales of $915 million in the third quarter, down 5% year-over-year
•Net income of $36 million, or $1.39 per diluted share, in the third quarter, up 38% from the third quarter of 2023
•EBITDA of $85 million in the third quarter, or 9.3% of net sales, up 8% year-over-year
•Operating profit margin of 5.9% in the third quarter, up from 4.8% in the third quarter of 2023
•Quarterly dividend of $1.05 per share paid, totaling $27 million in the third quarter
•Cash flows provided by operations of $402 million for the LTM period ended September 30, 2024
•Strong liquidity position with $161 million of cash and cash equivalents and $383 million of availability on revolving credit facility at September 30, 2024

Elkhart, Indiana - November 7, 2024 - LCI Industries (NYSE: LCII), a leading supplier of engineered components to the recreation and transportation markets, today reported third quarter 2024 results.

"Despite a challenging RV and Marine industry backdrop, we delivered a strong quarter with continued market share expansion, increased operating margins, and robust operating cash flow which has reached $402 million over the last twelve months. Share gains were particularly strong across appliances, awnings, chassis, furniture, and windows, which together represent more than 70% of our total North American RV OEM business. These gains were fueled by innovative products like the new line of CURT towing and suspension products we showcased at the September Open House,” commented Jason Lippert, LCI Industries’ President and Chief Executive Officer. “As a result, our key customers have maintained and increased the amount of Lippert content across their 2025 RV models. At the same time, we believe our commitment to operational excellence, including product quality and supply chain improvement initiatives, drove further margin expansion. Looking ahead, we believe we’re positioned to outperform as demand rebounds, powered by our cutting-edge innovation and a prioritization of strategic M&A to further enhance our diversification and long-term growth potential.”

“I’d like to thank our team members for their dedication to driving our business forward this quarter while working through a challenging environment,” commented Ryan Smith, LCI Industries' Group President - North America. “We remain focused on leveraging our operational expertise and culture of innovation to support long-term growth for Lippert.”

Third Quarter 2024 Results

Consolidated net sales for the third quarter of 2024 were $915.5 million, a decrease of 5% from 2023 third quarter net sales of $959.3 million. Net income in the third quarter of 2024 was $35.6 million, or $1.39 per diluted share, compared to $25.9 million, or $1.02 per diluted share, in the third quarter of 2023. EBITDA in the third quarter of 2024 was $85.2 million, compared to EBITDA of $78.9 million in the third quarter of 2023. Additional information regarding EBITDA, as well as reconciliations of this non-GAAP financial measure to the most directly comparable


GAAP financial measure of net income, is provided in the "Supplementary Information - Reconciliation of Non-GAAP Measures" section below.

The decrease in year-over-year net sales for the third quarter of 2024 was primarily driven by lower sales to North American marine and utility trailer OEMs and declines in wholesale shipments of motorhome RV units, partially offset by increased North American RV wholesale shipments of travel trailers and fifth-wheels and market share gains in the automotive aftermarket.

October 2024 Results

October 2024 consolidated net sales were approximately $330 million, down 4% from October 2023, primarily due to an approximate 12% decline in marine sales and an approximate 3% decrease in North American RV production compared to October 2023.

OEM Segment - Third Quarter Performance

OEM net sales for the third quarter of 2024 were $684.5 million, a decrease of $44.0 million compared to the same period of 2023. RV OEM net sales for the third quarter of 2024 were $422.0 million, down 2% compared to the same prior year period, driven by a shift in unit mix towards lower content single axle travel trailers and a 25% decrease in motorhome wholesale shipments, partially offset by an 11% increase in North American travel trailer and fifth-wheel wholesale shipments and market share gains. Adjacent Industries OEM net sales for the third quarter of 2024 were $262.4 million, down 12% year-over-year, primarily due to lower sales to North American marine and utility trailers OEMs, driven by current dealer inventory levels, inflation, and elevated interest rates impacting retail consumers. North American marine OEM net sales in the third quarter of 2024 were $60.8 million, down 16% year-over-year.

Operating profit of the OEM Segment was $21.8 million in the third quarter of 2024, or 3.2% of net sales, compared to $11.2 million, or 1.5% of net sales, in the same period in 2023. The operating profit expansion of the OEM Segment for the quarter was primarily driven by operational improvements, partially offset by the impact of fixed costs spread over decreased sales.

Aftermarket Segment - Third Quarter Performance

Aftermarket net sales for the third quarter of 2024 were $231.0 million, in line with the same period in 2023. Resiliency in the Aftermarket Segment was primarily driven by market share gains in the automotive aftermarket, partially offset by lower volumes within the RV aftermarket, which has been negatively impacted by lower consumer discretionary spending. Operating profit of the Aftermarket Segment was $32.1 million in the third quarter of 2024, or 13.9% of net sales, compared to $34.4 million, or 14.9% of net sales, in the same period in 2023. The operating profit contraction of the Aftermarket Segment for the quarter was primarily driven by increased labor costs due to product mix and increased facility costs resulting from investments to expand capacity within the automotive aftermarket, partially offset by decreased material costs.

“Our automotive aftermarket business has continued to outperform, delivering a 7.3% increase in sales to help offset softness in the RV and Marine aftermarkets. We’re also capitalizing on the growing demand for replacement and repair parts by providing innovative content coupled with high quality service, setting us apart for both dealers and consumers,” commented Jamie Schnur, LCI Industries’ Group President – Aftermarket. “We look forward to further expanding our presence in premium markets to support Lippert’s long-term, profitable growth.”

Income Taxes

The Company's effective tax rate was 24.8% for the quarter ended September 30, 2024, compared to 26.6% for the quarter ended September 30, 2023. The decrease in the effective tax rate was primarily due to a discrete tax benefit


related to an increase in the cash surrender value of company-owned life insurance policies compared to the prior year period.

Balance Sheet and Other Items

At September 30, 2024, the Company's cash and cash equivalents balance was $161.2 million, compared to $66.2 million at December 31, 2023. The Company used $80.2 million for dividend payments to shareholders, $31.4 million for capital expenditures, and $20.0 million for an acquisition in the nine months ended September 30, 2024.
The Company's outstanding long-term indebtedness, including current maturities, was $822.5 million at September 30, 2024, and the Company was in compliance with its debt covenants. As of September 30, 2024, the Company had $383.1 million of borrowing availability under the revolving credit facility.

Conference Call & Webcast

LCI Industries will host a conference call to discuss its third quarter results on Thursday, November 7, 2024, at 8:30 a.m. Eastern time, which may be accessed by dialing (833) 470-1428 for participants in the U.S. and (929) 526-1599 for participants outside the U.S. using the required conference ID 630651. Due to the high volume of companies reporting earnings at this time, please be prepared for hold times of up to 15 minutes when dialing in to the call. In addition, an online, real-time webcast, as well as a supplemental earnings presentation, can be accessed on the Company's website, www.investors.lci1.com.

A replay of the conference call will be available for two weeks by dialing (866) 813-9403 for participants in the U.S. and (44) 204-525-0658 for participants outside the U.S. and referencing access code 625624. A replay of the webcast will be available on the Company’s website immediately following the conclusion of the call.

About LCI Industries

LCI Industries (NYSE: LCII), through its Lippert subsidiary, is a global leader in supplying engineered components to the outdoor recreation and transportation markets. We believe our innovative culture, advanced manufacturing capabilities, and dedication to enhancing the customer experience have established Lippert as a reliable partner for both OEM and aftermarket customers. For more information, visit www.lippert.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" with respect to our financial condition, results of operations, profitability, margins, 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 production levels, 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, commodity prices, addressable markets, 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 future pandemics, geopolitical tensions, armed conflicts, or natural disasters 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 December 31, 2023, and in the Company's subsequent filings with the Securities and Exchange Commission. Readers of this press release are cautioned not to place undue reliance on these forward-looking statements, since there can be no assurance that these forward-looking statements will prove to be accurate. The Company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.

###



LCI INDUSTRIES
OPERATING RESULTS
(unaudited)
 Three Months Ended 
September 30,		Nine Months Ended 
September 30,		Last Twelve
 2024202320242023Months
(In thousands, except per share amounts)  
Net sales$915,497 $959,315 $2,938,070 $2,947,264 $3,775,614 
Cost of sales695,539 748,367 2,227,761 2,332,125 2,904,254 
Gross profit219,958 210,948 710,309 615,139 871,360 
Selling, general and administrative expenses166,070 165,358 508,206 494,332 666,636 
Operating profit53,888 45,590 202,103 120,807 204,724 
Interest expense, net6,516 10,325 23,799 30,968 33,255 
Income before income taxes47,372 35,265 178,304 89,839 171,469 
Provision for income taxes11,760 9,378 44,984 23,267 40,526 
Net income$35,612 $25,887 $133,320 $66,572 $130,943 
Net income per common share:     
Basic$1.40 $1.02 $5.24 $2.63 $5.15 
Diluted$1.39 $1.02 $5.23 $2.62 $5.14 
Weighted average common shares outstanding:    
Basic25,480 25,340 25,436 25,293 25,420 
Diluted25,558 25,504 25,477 25,405 25,498 
  
Depreciation$17,390 $18,857 $53,911 $55,974 $72,630 
Amortization$13,882 $14,412 $42,089 $42,844 $56,320 
Capital expenditures$10,062 $15,978 $31,390 $50,060 $43,539 



LCI INDUSTRIES
SEGMENT RESULTS
(unaudited)
 Three Months Ended 
September 30,		Nine Months Ended 
September 30,		Last Twelve
2024202320242023Months
(In thousands)
Net sales:  
OEM Segment:  
RV OEMs:  
Travel trailers and fifth-wheels$369,212 $363,573 $1,186,324 $1,032,866 $1,508,843 
Motorhomes52,800 65,669 185,258 206,404 248,210 
Adjacent Industries OEMs262,449 299,225 867,315 1,006,378 1,139,938 
Total OEM Segment net sales684,461 728,467 2,238,897 2,245,648 2,896,991 
Aftermarket Segment:     
Total Aftermarket Segment net sales231,036 230,848 699,173 701,616 878,623 
Total net sales$915,497 $959,315 $2,938,070 $2,947,264 $3,775,614 
Operating profit:     
OEM Segment$21,825 $11,165 $105,223 $29,086 $93,498 
Aftermarket Segment32,063 34,425 96,880 91,721 111,226 
Total operating profit$53,888 $45,590 $202,103 $120,807 $204,724 
Depreciation and amortization:
OEM Segment depreciation$13,270 $14,835 $41,038 $43,840 $55,596 
Aftermarket Segment depreciation4,120 4,022 12,873 12,134 17,034 
Total depreciation$17,390 $18,857 $53,911 $55,974 $72,630 
OEM Segment amortization$9,996 $10,550 $30,426 $31,204 $40,802 
Aftermarket Segment amortization3,886 3,862 11,663 11,640 15,518 
Total amortization$13,882 $14,412 $42,089 $42,844 $56,320 


LCI INDUSTRIES
BALANCE SHEET INFORMATION
(unaudited)
 September 30,December 31,
 20242023
(In thousands)  
ASSETS  
Current assets  
Cash and cash equivalents$161,184 $66,157 
Accounts receivable, net319,166 214,707 
Inventories, net705,439 768,407 
Prepaid expenses and other current assets59,084 67,599 
Total current assets1,244,873 1,116,870 
Fixed assets, net443,349 465,781 
Goodwill593,882 589,550 
Other intangible assets, net412,818 448,759 
Operating lease right-of-use assets233,225 245,388 
Other long-term assets96,817 92,971 
Total assets$3,024,964 $2,959,319 
LIABILITIES AND STOCKHOLDERS' EQUITY  
Current liabilities  
Current maturities of long-term indebtedness$222 $589 
Accounts payable, trade193,636 183,697 
Current portion of operating lease obligations39,035 36,269 
Accrued expenses and other current liabilities199,081 174,437 
Total current liabilities431,974 394,992 
Long-term indebtedness822,322 846,834 
Operating lease obligations207,937 222,680 
Deferred taxes28,631 32,345 
Other long-term liabilities115,778 107,432 
Total liabilities1,606,642 1,604,283 
Total stockholders' equity1,418,322 1,355,036 
Total liabilities and stockholders' equity$3,024,964 $2,959,319 





LCI INDUSTRIES
SUMMARY OF CASH FLOWS
(unaudited)
 Nine Months Ended 
September 30,
 20242023
(In thousands)  
Cash flows from operating activities:  
Net income$133,320 $66,572 
Adjustments to reconcile net income to cash flows provided by operating activities:  
Depreciation and amortization96,000 98,818 
Stock-based compensation expense13,961 14,027 
Other non-cash items4,927 4,611 
Changes in assets and liabilities, net of acquisitions of businesses: 
Accounts receivable, net(102,127)(121,914)
Inventories, net81,166 246,155 
Prepaid expenses and other assets(1,491)31,237 
Accounts payable, trade8,333 54,817 
Accrued expenses and other liabilities29,599 (5,060)
Net cash flows provided by operating activities263,688 389,263 
Cash flows from investing activities:  
Capital expenditures(31,390)(50,060)
Acquisitions of businesses(19,957)(25,851)
Other investing activities781 4,284 
Net cash flows used in investing activities(50,566)(71,627)
Cash flows from financing activities:  
Vesting of stock-based awards, net of shares tendered for payment of taxes(9,120)(9,591)
Proceeds from revolving credit facility86,248 248,900 
Repayments under revolving credit facility(87,766)(414,554)
Repayments under term loan and other borrowings(26,357)(45,767)
Payment of dividends(80,191)(79,744)
Payment of contingent consideration and holdbacks related to acquisitions(2)(31,857)
Other financing activities— (834)
Net cash flows used in financing activities(117,188)(333,447)
Effect of exchange rate changes on cash and cash equivalents (907)(446)
Net increase (decrease) in cash and cash equivalents95,027 (16,257)
Cash and cash equivalents at beginning of period66,157 47,499 
Cash and cash equivalents at end of period$161,184 $31,242 


LCI INDUSTRIES
SUPPLEMENTARY INFORMATION
(unaudited)
Three Months EndedNine Months Ended
September 30,September 30,Last Twelve
2024202320242023Months
Industry Data(1) (in thousands of units):
Industry Wholesale Production:
Travel trailer and fifth-wheel RVs68.5 61.5 224.0 195.8 287.4 
Motorhome RVs7.7 10.3 26.9 35.8 37.0 
Industry Retail Sales:
Travel trailer and fifth-wheel RVs84.1 (2)92.0 248.1 (2)273.0 301.8 (2)
Impact on dealer inventories(15.6)(2)(30.5)(24.1)(2)(77.2)(14.4)(2)
Motorhome RVs10.2 (2)11.7 31.8 (2)37.3 39.8 (2)
Twelve Months Ended
September 30,
20242023
Lippert Content Per Industry Unit Produced:
Travel trailer and fifth-wheel RV$5,147 $5,191 
Motorhome RV$3,768 $3,705 
September 30,December 31,
202420232023
Balance Sheet Data (debt availability in millions):
Remaining availability under the revolving credit facility (3)
$383.1 $178.5 $245.3 
Days sales in accounts receivable, based on last twelve months30.6 29.2 30.1 
Inventory turns, based on last twelve months3.9 3.3 3.5 
2024
Estimated Full Year Data:
Capital expenditures
$35 - $45 million
Depreciation and amortization
$125 - $135 million
Stock-based compensation expense
$17 - $22 million
Annual tax rate
24% - 26%
(1) Industry wholesale production data for travel trailer and fifth-wheel RVs and motorhome RVs provided by the Recreation Vehicle Industry Association. Industry retail sales data provided by Statistical Surveys, Inc.
(2) September 2024 retail sales data for RVs has not been published yet, therefore 2024 retail data for RVs includes an estimate for September 2024 retail units. Retail sales data have historically been revised upwards in future months as various states report.
(3) Remaining availability under the revolving credit facility is subject to covenant restrictions.



LCI INDUSTRIES
SUPPLEMENTARY INFORMATION
RECONCILIATION OF NON-GAAP MEASURES
(unaudited)

The following table reconciles net income to EBITDA and net income as a percentage of net sales to EBITDA as a percentage of net sales.
Three Months Ended September 30,Nine Months Ended September 30,
 2024202320242023
(In thousands) 
Net income$35,612 $25,887 $133,320 $66,572 
Interest expense, net6,516 10,325 23,799 30,968 
Provision for income taxes11,760 9,378 44,984 23,267 
Depreciation expense17,390 18,857 53,911 55,974 
Amortization expense13,882 14,412 42,089 42,844 
EBITDA$85,160 $78,859 $298,103 $219,625 
Net sales$915,497 $959,315 $2,938,070 $2,947,264 
Net income as a percentage of net sales3.9 %2.7 %4.5 %2.3 %
EBITDA as a percentage of net sales9.3 %8.2 %10.1 %7.5 %
In addition to reporting financial results in accordance with U.S. GAAP, the Company has provided the non-GAAP performance measures of EBITDA and EBITDA as a percentage of net sales to illustrate and improve comparability of its results from period to period. EBITDA is defined as net income before interest expense, net, provision for income taxes, depreciation expense, and amortization expense during the three and nine month periods ended September 30, 2024 and 2023. The Company considers these non-GAAP measures in evaluating and managing the Company's operations and believes that discussion of results adjusted for these items is meaningful to investors because it provides a useful analysis of ongoing underlying operating trends. These measures are not in accordance with, nor are they substitutes for, GAAP measures, and they may not be comparable to similarly titled measures used by other companies.

LCI Industries Q3 2024 Earnings Conference Call November 7, 2024 1

 
Forward-Looking Statements This presentation contains certain “forward-looking statements” with respect to our financial condition, results of operations, profitability, margin growth, 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 presentation 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 the Company's 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, commodity prices and industry trends, whenever they occur in this presentation 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 presentation, the impacts of future pandemics, geopolitical tensions, armed conflicts, or natural disaster 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 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 December 31, 2023, and in the Company’s subsequent filings with the Securities and Exchange Commission, including the Company's Quarterly Reports on Form 10-Q. Readers of this presentation are cautioned not to place undue reliance on these forward- looking statements, since there can be no assurance that these forward-looking statements will prove to be accurate. The Company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law. This presentation includes certain non-GAAP financial measures, such as EBITDA, EBITDA as a percentage of net sales, net debt to EBITDA leverage, and free cash flow. These non-GAAP financial measures should not be considered a substitute for the comparable GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure are included in the presentation. 2

 
Strong operating performance and cash flow generation in challenging environment Third Quarter 2024 Highlights Financial Performance ■ Net sales of $915 million in the third quarter, down 5% year- over-year ■ Net income of $36 million, or 3.9% of net sales, in the third quarter, up 38% year-over-year ■ EBITDA1 of $85 million, or 9.3% of net sales, in the third quarter, up 8% year-over-year ■ Cash flows provided by operations of $402 million for the LTM period ended September 30, 2024 Executing Cost Management and Continuous Improvement initiatives ■ Operating profit margin of 5.9%, up 110 bps year-over year ■ Lowered material costs through supply chain improvements ■ Product quality initiatives helped reduce warranty costs by $10 million year-over-year ■ Consolidating facilities while maintaining scalable capacity to optimize manufacturing footprint - gross reductions of approximately two million sq. feet since 2023 Gaining Share through Innovation ■ Grew sales to RV OEMs in our top 5 product categories despite negative mix shift ■ Delivered towable organic content growth both sequentially and year-over-year2 ■ Highly successful new product launch with 2025 RV model year - including ABS, A/C innovation, coil spring suspension, new window designs, and new patented Sun Deck 3 1 Additional information regarding EBITDA and EBITDA as a percentage of net sales, and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, are provided in the Appendix 2 For twelve months ended September 30, 2024 Capital Allocation ■ Strong liquidity position with $161 million of cash and cash equivalents and $383 million of availability on revolving credit facility at September 30, 2024 ■ Returned $80 million of capital to shareholders with quarterly dividends YTD through September 30, 2024 ■ Continuing to evaluate strategic acquisitions opportunities

 
Performance and Trends • 68,500 wholesale towable units shipped in Q3 2024, up 11% YoY • 84,100 estimated retail towable units sold in Q3 2024, down 9% YoY ◦ Implied reduction of dealer inventories of 15,600 for the quarter • YTD wholesale units through September 30, 2024 of 256,400 and YTD retail units of 286,600, signaling healthy dealer inventory reduction • Gained share in our top 5 RV product categories: appliances, awnings, chassis, furniture, and windows YTD through September 30, 2024 • Q3 2024 NA RV OEM sales up slightly YoY, as share gains offset mix shifts toward lower content towables • Our current full year 2024 North American forecast is 315 - 325k wholesale units ◦ Our initial expectations for 2025 NA forecasted wholesale units is 330 - 350k North American RV OEM 4 Net Sales (in thousands)

 
Innovation Driving RV Content Growth, Share Gains 5 YoY Towable Content Growth (LTM) Key 2025 Model Year Product Wins Sequential Towable Content Growth (LTM) Touring Coil Suspension Furrion® 18K Chill Cube Air Conditioner * "Other" includes impact of RV unit shipments versus industry production, index sales price adjustments, and the impact of acquisitions and divestitures New Window Designs and Integrated Shades

 
Customers are adding new products showcased at Open House to latest RV models, supporting content growth RV Open House - Innovation Highlights 6 New Porch Concepts Dealer/Customer Ride-Alongs: Helux Pin Box, TCS & ABS Experiences Larger Window and Glass ApplicationsNew Patented Bi-Fold Sundeck

 
Performance and Trends • Q3 2024 Adjacent Industries sales down 12% YoY • Decrease primarily due to lower sales to North American marine and utility trailer OEMs ◦ Pressured by current dealer inventory levels, inflation, and elevated interest rates impacting retail consumers • Expanding presence in transportation and building markets: ◦ Supplying axles to top trailer brands, which produce 500k+ utility and cargo trailers annually ◦ Adding windows in off-road vehicles, school buses, and manufactured housing, driving growth Adjacent Industries OEM 7 Net Sales (in thousands)

 
Performance and Trends • Q3 2024 sales in line with the prior year; resiliency driven by market share gains in the automotive aftermarket, offset by softness in RV and Marine aftermarkets • 100 bps YoY margin contraction primarily driven by increased labor costs due to product mix and increased production facility costs from investments to expand capacity in the automotive aftermarket • Driving portfolio expansion in diversified markets with towing and truck accessories, boating accessories, appliances, and electronics • Meeting heightened repair and replacement demand as RV ownership has reached record levels in recent years ◦ 2021 and 2022 model year units are exiting warranty period and shifting into aftermarket sales opportunity Aftermarket Segment 8 Net Sales (in thousands)

 
International Business 9 Net Sales1 (in thousands) 1 International results include RV OEM, Adjacent Industries OEM, and Aftermarket net sales. Performance and Trends • Q3 2024 international sales1 down 9% YoY, primarily driven by softening RV markets, partially offset by strength in the rail market • Leading global OEMs are utilizing Lippert's Technical Excellence Center for product design and innovation within rail market • Maintaining focus on introducing popular European products in North American markets, including window blinds and pop tops for the RV market, and applying marine saltwater thruster technology to pontoon boat docking systems • Product introductions like Polyplastic's energy-saving DoubleCOOL doors for commercial refrigeration supporting expansion into new, premium markets

 
Leveraging Strengths to Win Market Share • Delivering innovative products through leading, nimble manufacturing capabilities • Building upon long-term customer relationships to expand product offerings and bundle multiple product categories • Focusing on content and market share growth across our business Growth Strategy Winning through our diversified portfolio, cutting-edge innovation, and best-in-class service Capital Allocation Strategy • Focusing on strategic acquisitions to expand presence in existing markets • Investing in R&D and innovation to drive profitable growth • Returning capital to shareholders Continue Execution of our Diversification Strategy • Expanding market share beyond our RV OEM channel to increase stability and deliver shareholder value • Enhancing our offerings in the outdoor recreation, transportation, and building products industries • Working to capture market share in approximately $12 billion of combined addressable opportunities across our business 10

 
Q3 2024 Financial Performance * Additional information regarding EBITDA, as well as reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure, is provided in the Appendix. 11 -5% +38% +110 bps +8%

 
As of and for the nine months ended September 30 Liquidity and Cash Flow 2024 2023 Cash and Cash Equivalents $161M $31M Remaining Availability under Revolving Credit Facility(1) $383M $179M Capital Expenditures $31M $50M Dividends $80M $80M Debt / Net Income (TTM) 6.3x 18.4x Net Debt/EBITDA (TTM)(2) 2.0x 3.8x Cash from Operating Activities $264M $389M Free Cash Flow(2) $232M $339M 1 Remaining availability under the revolving credit facility is subject to covenant restrictions. 2 Additional information regarding net debt to EBITDA and free cash flow, as well as a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, is provided in the Appendix. 12

 
Reconciliation of Non-GAAP Measures Appendix EBITDA Three Months Ended September 30, Nine months ended September 30, Twelve months ended September 30, ($ in thousands) 2024 2023 2024 2023 2024 2023 Net income $ 35,612 $ 25,887 $ 133,320 $ 66,572 $ 130,943 $ 49,443 Interest expense, net 6,516 10,325 23,799 30,968 33,255 39,188 Provision for income taxes 11,760 9,378 44,984 23,267 40,526 9,139 Depreciation and amortization 31,272 33,269 96,000 98,818 128,950 132,064 EBITDA $ 85,160 $ 78,859 $ 298,103 $ 219,625 $ 333,674 $ 229,834 Net sales $ 915,497 $ 959,315 $ 2,938,070 $ 2,947,264 $ 3,775,614 $ 3,841,610 Net income as a % of Net Sales 3.9 % 2.7 % 4.5 % 2.3 % 3.5 % 1.3 % EBITDA as % of Net Sales 9.3 % 8.2 % 10.1 % 7.5 % 8.8 % 6.0 % FREE CASH FLOW Nine Months Ended September 30, NET DEBT/EBITDA (TTM) September 30, 2024 September 30, 2023 ($ in thousands) 2024 2023 Total debt $ 822,544 $ 908,811 Net cash flows provided by Less cash and cash equivalents 161,184 31,242 operating activities $ 263,688 $ 389,263 Net debt $ 661,360 $ 877,569 Capital expenditures (31,390) (50,060) Free cash flow $ 232,298 $ 339,203 Total Debt/Net Income (TTM) 6.3x 18.4x Net Debt/EBITDA (TTM) 2.0x 3.8x 13 EBITDA, EBITDA as a percentage of net sales, and free cash flow are non-GAAP performance measures included to illustrate and improve comparability of the Company's results from period to period. EBITDA is defined as net income (loss) before interest expense, provision (benefit) for income taxes, and depreciation and amortization expense. Free cash flow is defined as net cash flows provided by operating activities minus capital expenditures. The Company considers these non-GAAP measures in evaluating and managing the Company's operations and believes that discussion of results adjusted for these items is meaningful to investors because they provide a useful analysis of ongoing underlying trends. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures, and they may not be comparable to similarly titled measures used by other companies. The net debt to EBITDA ratio on a trailing twelve month basis is a non-GAAP performance measure included because the Company believes it is useful to investors in evaluating the Company's leverage. The net debt to EBITDA ratio is defined as total debt, less cash and cash equivalents, divided by EBITDA. The net debt to EBITDA ratio is a non-GAAP measure and should not be considered a substitute for the ratio of total debt to net income determined in accordance with GAAP. The Company's calculation of its net debt to EBITDA ratio might not be calculated in the same manner as, and thus might not be comparable to, similarly titled measures used by other companies.

 
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v3.24.3
Cover
Nov. 07, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 07, 2024
Entity Registrant Name LCI INDUSTRIES
Entity Incorporation, State or Country Code DE
Entity File Number 001-13646
Entity Tax Identification Number 13-3250533
Entity Address, Address Line One 3501 County Road 6 East,
Entity Address, City or Town Elkhart,
Entity Address, State or Province IN
Entity Address, Postal Zip Code 46514
City Area Code (574)
Local Phone Number 535-1125
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Title of 12(b) Security Common Stock, $.01 par value
Trading Symbol LCII
Security Exchange Name NYSE
Entity Central Index Key 0000763744
Amendment Flag false
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