Patrick Executives Seeing ‘Modest Improvements’ in RV Market – RVBusiness – Breaking RV Industry News
On the heels of a mostly favorable first quarter financial report, Patrick Industries executives said they were seeing “dynamic conditions” across all of its primary end markets and “modest improvements” in the RV and marine segments in particular.
In its Q1 report, Patrick announced first quarter revenues increased 4% to $933 million and, on a trailing 12-month basis, its consolidated revenues were approximately $3.5 billion. The company’s net income in the first quarter improved 16% to $35 million, the report stated.
In a conference call with investment analysts following the report, a host of company execs including CEO Andy Nemeth and President Jeff Rodino said Patrick “remains in a position of strength.”
“Our team continues to anticipate and adjust to market and macroeconomic forces through the management of our highly variable cost structure,” Nemeth said, “and our model performed well during a seasonally slow period also as a result of acquisitions completed over the past year, operational efficiencies gained through automation and better throughput and our diversification among other items, as shown by our continued solid margin performance.”
Speaking on the company’s January 2024 acquisition of Sportech, a supplier in the powersports industry, Nemeth said Patrick was “thrilled with the initiatives already set in motion and the future growth potential we see ahead of us.”
He pointed out that Patrick has already benefited from the Sportech addition, which is the largest acquisition in the company’s history.
“Examples of our drive to immediately deliver synergies post-closing involves our team at Rockford Fosgate hosting Sportech to showcase the benefits of being connected to the Patrick ecosystem. And how our businesses are able to collaboratively leverage their processes and expertise, bringing additional value to their respective customers,” Nemeth said.
“We also invited our key plastics, metals, and harness and dash businesses to Sportech for a brainstorming session, including a production line walk-through to identify avenues of opportunity between business units, their best practices, and potential areas for collaboration, including logistics, sourcing and material synergies,” he added.
After reminding everyone that the RV industry has historically been first market to enter and exit economic cycles, Rodino said the company believes RVs reached the bottom of the current lull in 2023.
Despite interest rates continuing to negatively impact retail demand, Rodino noted that through the first quarter RV wholesale shipments have seen some sequential and year-over-year improvement.
“We expect these positive trends to continue in the near-term, give the need for additional inventory and preparation for spring selling season and the coming 2025 model year change,” Rodino said.
“Our first quarter RV revenues increased 15% to $421 million when compared to the same period in 2023 and represented 45% of consolidated revenue,” he stated in his prepared remarks. “RV content per unit on a TTM (trailing 12-month) basis was $4,859, off by about 9% from the record level we achieved for the first quarter of 2023. On a positive note, RV content per unit on a TTM basis increased sequentially in Q1 of 2024 from Q4 of 2023.”
