Slide 1: A Leading National Supplier of a Wide Variety of Components for RVs and Manufactured Homes
ff A Leading National Supplier of a Wide Variety of DW Components for RVs and Manufactured Homes NYSE.
Slide 2: Forward-looking statements
This presentation 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 Comp
Slide 3: Overview
vervie L SECTION @
Slide 4: Aftermarket
Aftermarket Total $573 $681 $901 $1,016 $1,191 $1,267
Slide 5: 1) Excludes the loss on sale of extrusion assets of $1,954 million. For further
1) Excludes the loss on sale of extrusion assets of $1,954 million. For further information, please refer to the Company's most recent filing.
Slide 6: Drew's Products
Slide 7: Net Sales of $1,267 Million for the Twelve Months Ended March 2015
Net Sales of $1,267 Million for the 12 Months Ended March 31, 2015 RV Fumiture and Mattresses: MH Chassis and $145 million Chassis Parts: $32 million RV Chassis, Slide-outs and Other Chassis Parts: $599 million Other Products: $104 million Axles and Suspension Products: $103 million viene ae tiseome
Slide 8: Financial Performance
> Financial Performance Net Sales = RV Segment net sales MH Segment net sales == EBITDA EBITDA $1,400 a Net Sales and EBITDA ") (in mitions) $1,200 $1,016 i $1,000 7 + $100 $901 i $800 $729 yy f $80 $669 ig S669 $681 2 t 3 i 600 Be a i) : ow $511 | my + g t $398 eit : $400 225 $354 Mm + $40 os i BB
Slide 9: Sales growth notes: acquisitions, organic and industry
a) Sales for acquisitions represent the trailing twelve month sales at the date of acquisition. Any post-acquisition change is includedin organic orindustry accordingly. b) Organic growth consists primarily of gains in market share, price increases, increased adjacent industry sales andnew productsa
Slide 10: Management Team
& INDUSTRIES INCORPORATED MANAGEMENT TEAM JASON LIPPERT, CEO > 20 years with Drew SCOTT MERENESS, PRESIDENT > 20 years with Drew JOE GIORDANO, CFO & TREASURER > 12 years with Drew > Average tenure of senior management 14+ years with Drew 9.
Slide 11: RV Industry
RV Industry
Slide 12: Towable RVs and Motorhomes
Towable RVs (Approxmatel (856 of industry 2014 unit sales RV Segmentnet sales) of 2013 wholesale dollar sales, or $8.1 billion Retail cost $4,000 to $100,000 per unit. Average about $29,000 Motorhomes (Approximately 7% of Drew's RV Segmentnet sales) of industry 2014 unit sales of 2013 wholesale doll
Slide 13: RV campers statistics
(BE 5A, tye Tent Campers 3414000 agp Ever Other Year Heel Ai 21,340,800 38. === ; Active Campers RV Campers by 39,520,000- 9,089,600 Cabin Campers 7,508,800 * Estimates based on 104 million households. All other (4%) 1,580,800, Statistics provided by KOA 2014.
Slide 14: RV family vacation trends and demographics
+ Typical RV family vacation is 23 to 59 percentless expensive for a family of four * College and NFL football games + NASCAR events + More active, shorter, “greener”, & family oriented vacations The number of consumers between the ages of 55 and 70 is projected to total 56 million by 2020, 27 perce
Slide 15: RVs - Industry Wholesale Shipments
> RVs - Industry Wholesale Shipments Approximately 78% of Drew's RV Segment net sales are for Travel Trailer and 5" Wheel RVs 500 m= Notorhomes (industry units in thousands} = Other Towables Travel Trailers & 5th Wheels 400 31 370 311 384 353 321 300 257 7 ay : a © 166 200 320 305 aati > i 299 268 2
Slide 16: RV Shipments
Thousands of Units > RV Shipments Compound Annual Growth Rate from 19 = 450 18% oe RV Shipments 2 RV Shipments vs Federal 400 = 400 leferash Rat 16% os ee interest Rate so +4 aS fxm 250 14 ws 3 250 z 2 20 |} _ales ' = 10 | Vy fs 100 5 0 0 eae Pea, RING - PELL LLELEL LIES SIL SHS D POCPP PLP P LISI G
Slide 17: RV Industry Trends
> RV Industry Trends noe Travel Trailer and 5! Wheel RVs, Drew’s primary RV market 325 Wholesale == Retail ei 298.9 300 (Units in thousands) 268.0 272.4 250.8 a) a 242.9 = § 2129 222.8 ieee 208.0 200 185.1 186.0 175 164.3 180 138.3 125 ty 75.4 81.8 75 45.3 51.3 50 - | | ° "2008 2008 2010 2011 2012 2
Slide 18: Number of U.S. Households that Own an RV
> Number of U.S. Households that Own an RV (in Millions) 10 9 6 a 7 | 4 | dl | Bs ee a : B | 1980 1984 1988 1993 1997 2001 2005 2011 prew Statistics provided by RVIA Industry Profile 2013. 7
Slide 19: Demographics
> Demographics Number of U.S. households that own an RV 7.9 million 8.9 million Household ownership rates of RVs 80% 85% Average age of all RVs 12.7 years 14.2years Average time consumers have owned their 6.6 years 8.4 years current RV Age of typical RV owner A9 years A8 years Average income of RV o
Slide 20: Our RV Segment
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Slide 21: RVs - Industry Wholesale Shipments (Compared to Drew's Performance)
» RVs - Industry Wholesale Shipments (Compared to Drew’s Performance) Approximately 78% of Drew’s RV Segment net sales are for Travel Trailer and 5" Wheel RVs 800 y $1200 Industry unitsin thousands, net sales in millions) ™ $1,150 aa == Hotorhomes 31,075 Other Towables $1,000 Travel Trailers & 5th W
Slide 22: Content Per New Towable RV
> Content Per New Towable RV -Approximately 78% of RV Segment net sales are for Travel Trailer and Fifth-Wheel RVs - 100% market share in existing A products would yield an estimated oc $5,000 per Towable RV are $2,690 $2,716 - Growth in RV “features” drives ort content increases $2,825 92.923 2001
Slide 23: Content Per New Motorhome RV
> Content Per New Motorhome RV -Approximately 6% of RV $1,679 Segment net sales are for $1,544 Motorhome RVs 9% yew - 100% market share in Perk existing products would yield eee $1,227 $1,252 an estimated $5,000 per eco" Motorhome RV poset pk | $669 = al [ I I | a 2005 2009 ©2010 2011 «2012 «2013 «-
Slide 24: RV Segment Net Sales by Type
>» RV Segment Net Sales by Type LTM 03/15- $1,150 Million $123 million 11% a) fale LTM 03/14- $929 Million $75 million 6% $95 million $892 million $52 million. 78% 6% $755 million 81% = Travel Trailer & Fifth-Wheel - OEM ™ Motorhome - OEM Aftermarket » Adjacent Industries
Slide 25: Manufactured Housing Industry
SECTION @ Manufactured Housing Industry
Slide 26: Manufactured Housing (MH) Market
> Manufactured Housing (MH) Market a” Cost per sq. ft. is $44 for MH vs: $94 for site-built homes a_ Average retail price of $64,000 for a 1,470 sq. ft. MH a 9 million manufactured homes acrossithe U.S: ” Improved quality, appearance and safety ” Studies have shown MHs built since 1995 sustain no mo
Slide 27: Manufactured Housing - Industry Production
> Manufactured Housing — Industry Production Industry Units 200 7 193 {industry units in thousands) tee _ Multi-Sections === Single-Section 2001 2002 2003 2004 2005 2008 2007 2008 2009 2010 2011 2012 2013 2014 LT ats Mi Share 75% 78% 79% 74% «65% 72% «BK « «63% «SUH «51% «SIKH «53% 52% Held by Mut-S
Slide 28: MH: Favorable Factors
> MH: Favorable Factors a” Industry Demand > Demand for quality, affordable housing is likely to increase > Baby boomers retiring in increasing numbers > Dealer and manufacturer inventory levels are reasonable > Availability of financing is still an issue, as is the weak overall housing market a” Dr
Slide 29: Our Manufactured Housing Segment
SECTION @ Our Manufactured Housing Segment
Slide 30: Manufactured Housing - Industry Production (Compared to Drew's Performance)
> Manufactured Housing — Industry Production (Compared to Drew's Performance) Industry - a, Drew’s Gate (Industry unitsin thousands, net sales in millions} Ne cues _ Multi-Sections === Single-Section Drew's MH Segment a net sales $250 S220NMez20 200 193 $200 ate $177 168 ee a 131, 431 $142 $150 $134
Slide 31: Content Per New Manufactured Home
> Content Per New Manufactured Home 100% market share in existing products $1,666 would yield an estimated $4,500 perhome $1,450 $1,429 aes $1493 51,465 $1,330 E 1,281 1,307 Affordability of the homes. % : . $1,203 $1,192 constrains content growth 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20
Slide 32: MH Segment Net Sales by Type
> MH Segment Net Sales by Type LTM 3/15- $117 Million LTM 3/14 - $120 Million $79 million 67% $79 million 66%
Slide 33: Strategy
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Slide 34: Business Strategy
> Business Strategy a Maximize profitability and return on assets through > New product introductions > Market share growth > Operational efficiencies > Diversification to related industries > Strategic acquisitions a This strategy accomplished through > Outstanding customer service > Motivating man
Slide 35: Expanding Our Growth Potential
> Expanding Our Growth Potential Developed Line of RV Awnings $ 100 milion Doors and Windows for Truck Caps, Horse Trailers and Buses $ 100 milion Cross Sell Existing Products to Boat, Livestock, Equipment, Utility and Cargo Trailer $ 400 milion Markets, as well as Mid-Size and School Buses Sales of
Slide 36: Acquisition Criteria
> Acquisition Criteria a Drew is a disciplined and patient acquirer a Gain market share or add products from other suppliers through acquisitions a Seek products or technologies that we can expand through our nationwide customer base and factory network a Become an even more extensive supplier to ou
Slide 37: New Products & Acquisitions
> New Products & Acquisitions AcQuRE TRAIL AR: Adding RV suspension products 2006 ACQUIRE HAPPUAC: Adding patented bed lifts for RVs AcQuRE Coach Ster: Adding electric steps for motorhomes 2007 ACQUIRE EXTREME ENGINEERING: Expanding specialty trailer product line AcaumrE SEATING TECHNOLOGY: ‘Adding
Slide 38: New Products & Acquisitions
> New Products & Acquisitions AcauIRE ACQUIRE POWER ence MiDsTATES: GEAR & KWIKEE: moe Adding Tool & Expanding RV esse? Die and leveling systems, customization auomelion. slideouts and ACQUIRE EA operation capabilties steps (Hn : \coURE “Cian ae or care towable RV ae DESIGN: Expanding chassis and Ex
Slide 39: Innovative Design Solutions
Innovative Design Solutions!) (1) Plus contingent consideration payable on future sales. IDS had annual sales of approximately $19 million in 2013, of which $15 million were to the Company. (2) Plus contingent consideration payable on future sales.
Slide 40: The Future
> The Future Increasing RV content RV industry growth Demographic tailwind Expanding into adjacent industries, aftermarket and international a Affordable housing recovery u MWY
Slide 41: Thank You - Contact
Jason D. Lippert Chief Executive Officer JasonL@lci1.com THANK YOU | siveor= . ‘ ScottM@lci1.com For more information contact Joseph S. Giordano Ill CFO & Treasurer Joe@drewindustries.com @ Witter www.drewindustries.com @ Youtube www.lci1.com @ Facebook 574-535-1125
Slide 42: Supplemental Schedules
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Slide 43: Operating Results
> Operating Results Three Months Ended March 31, FINANCIAL PERFORMANCE 6 ions, except EPS) 2015 2014 Change Net Sales $ 361.5 $ 285.4 27% Operating Profit $ 31.8 $ 26.0 22% % of Sales 8.8% 9.1% Net Income $ 20.1 $ 162 24% Diluted EPS $ 0:82) $067 22%
Slide 44: MH Segment / RV Segment
MH Segment RV Segment
Slide 45: Debt Position
> Debt Position FINANCIAL PERFORMANCE Cash and Net Cash eater ae (in millions) Debt Investments (Debt) YTD Period 12/31/11 $ = $ Z $ 7 $ 50 12/31/12 $ - $ 10" $ 10") $ 1 12/31/13 $ - $ 66 $ 66 $ 5 12/31/14 $ 16 $ - $ (16)2) $ 107 03/31/15 $ 50 $ 28 $ — (22)3) $ 2514) (1) On December 20, 2012, the Co
Slide 46: Balance Sheets
> Balance Sheets 1 Total Assets col be 374 $ 453 $ 544 $ 629 Total Debt $ - $ - $ - $ 16 $ 50 Cash & Investments $ a $ 104) $ 66 $ - $ 28 Stockholders’ Equity $- 27 $ 2848 $ 3144 $ 395 $ 3705) Days Sales in a/R" 17 days 14 days 16 days 15 days 21 days Inventory Turns”) 6.2 turns 7.8 turns 7.9 turns
Slide 47: Cash Flow
> Cash Flow FINANC! ERFORMANCE Acquisitions (19)* $224 million Capital expenditures $150 million Special dividends $173 million Stock repurchases $ 2million Total $ 549 million * On April 24, 2015, the Company acquired the business and certain assets of Spectal, the purchase price of $22 million is
Slide 48: Cumulative operating cash flow
aD; E a FINANCIAL PERFORMANCE ‘Cumulative operating cash flow from 2009 to present [in millions) [1] Cash dividend of $2.00 per share, or $47 million, declared in December 2013 and paid in January 2014. [2) On April25, 2015, the Company acquired the business and certain assets of Spectal, the purcha
Slide 49: Financial Strength
> Financial Strength FINANCIAL PERFORMANCE 12/31/11 12/31/12 12/31/13 12/31/14 03/31/15 Return on Equity 11% 13% 16% 17% 18% Return on Assets 9% 10% 12% 12% 12% Weey eine 0.00 0.00 0.00 0.04 0.14 Equity oe se 0.00 0.00 0.00 0.12 0.37 (1) EBIDA is operating profit plus depreciation and amortization.
Slide 50: Reconciliation of Operating Profit to EBITDA
> Reconciliation of Operating Profit to EBITDA FINANCIAL PERFORMANCE LIM (S in millions) 2011-2012, 20132014 03/15 Se Seiten $485 $58.1 $783 $955 $1013 Profit Depreciation & Amnoteaton $20.5 $25.7 $275 $326 $35.2 EBITDA $69.0 $838 $105.8 $128.1 $136.4 Capital Expenditures $243 $32.0 $32.6 $425 $44.2
Slide 51: Net Sales and Operating Profit by Segment
Net Sales: RV Segment $ 5706 $ 7809 $ es z $ 1,074. 2 $ 1,150. i MH Segment 110.6 120.2 12 116. 116. Operating Profit: RV Segment LS A7.2 $ 682 $ 866 MH Segment . 12.4 1, 10.8 Sale of extrusion assets _ Total Operating Profit $ $ 78.3 $ 955 $ 101.3]
Slide 52: Stock Price History
> Stock Price History Drew has 24.1 million shares outstanding and a market capitalization of approximately $1.4 billion as of April 30, 2015 $6 2001 2002 2003 2004 2005 2006 10/5/07 2007 2008 3/9/09 2009 2010 2011 2012 2013 2014 4/30/15 + Datesnoted above are as of December 31, unless noted. + Stoc
Slide 53: Analyst Coverage
> Analyst Coverage a” Citi Research > Gregory Badishkanian — (212) 816-2720 a CJS Securities > Dan Moore — (914) 287-7600 a” Sidoti & Company, LLC > Scott Stember — (212) 453-7017 ” Thompson Research Group > Kathryn Thompson — (615) 891-6206