Patrick Industries, Inc. · NASDAQ:PATK

Patrick Industries — Investor Presentation (June 2017)

38 slides from Patrick Industries's investor presentation, Jun 7, 2017

1. Slide 1: Investor Presentation June 2017

   Investor Presentation June 2017

2. Slide 2: Forward-Looking Statements

   Forward-Looking Statements This presentation contains certain statements related to future results or states 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. T

3. Slide 3: Company Overview

   Company Overview

4. Slide 4: Patrick History

   2 0 1 5 Company taken public (NASDAQ) Date of Incorporation Patrick History 4 1 9 5 9 Company founded 1 9 6 1 1 9 6 8 2 0 0 7 Acquires Adorn Holdings, Inc. – the largest acquisition in the Company‟s History 2 0 0 8 Todd Cleveland named President („08) and CEO („09) Completes 3-for-2 common stock spl

5. Slide 5: Patrick at a Glance

    Founded in 1959 and incorporated in Indiana in 1961  Headquartered in Elkhart, Indiana – the “RV Capital of the World”  Leading national manufacturer and supplier of building and component products to the RV, MH, Marine and select Industrial markets  Operates over 80 facilities in 19 states  A

6. Slide 6: Product Portfolio

   P ro d u ct Port fo li o 6 RV •Q1-17 shipment growth 12% •72% of Q1-17 Patrick sales Wall and ceiling panels Pressed and hardwood doors Countertops Fabricated aluminum & FRP products Wrapped mouldings Cabinet doors Electrical, wiring, plumbing Furniture and mattresses Fiberglass products RV painting

7. Slide 7: Strong Brands

   7 Differentiated, customer-centric, brand strategy and business model  Portfolio of brands enable OEM customers to differentiate their products to consumers  Brands retain significant autonomy to maintain entrepreneurial spirit and brand individuality enabling continuation of legacy value proposit

8. Slide 8: Patrick Facility Profile

   Patrick Facility Profile 8 8 Strategically aligned with OEM customers with a nationwide network Over 80 facilities in 19 states with approximately 6,000 employees Headquarters Existing Patrick Facility

9. Slide 9: Our Markets

   Our Markets

10. Slide 10: Key Role in the Value Chain

    Key Role in the Value Chain 10 Activities and Value Proposition Success Drivers Component Suppliers OEMs Dealers  Source raw materials and select products  Innovate on design, product and materials to meet consumer preferences  Manufacture and distribute select components  Source components  De

11. Slide 11: RV Market

    RV Market 11 Long- Term Market Growth Industry Strength Economy Demographics Lifestyle  2016 was the 7th consecutive year of wholesale unit shipment growth; Q1-17 continuing momentum with 12% growth  Retail demand is strong  New innovative designs and products  Attractive product mix and price p

12. Slide 12: RV Market Industry Outlook

    173 163 203 228 +21% 259 247 248 255 293 +24% 321 300 257 311 321 370 384 +22% 391 353 237 166 242 252 286 321 357 374 431 RV Wholesale Unit Shipments Consumer Confidence RV Annual Shipments 558 524 Industry Outlook 12 Gulf War 9/11 Attacks Residential Housing Crisis It is our belief that trended sh

13. Slide 13: Market Conditions & Consumer Trends (Manufactured Housing)

    Market Conditions & Consumer Trends 13  Approximately 9 million households with 22 million people living in manufactured homes (9% of nation‟s single family housing stock)  Affordable form of home ownership:  Average structure cost per sq. ft. (2015): $47.55 (MH) vs. $100.65 (single family home)

14. Slide 14: MH Industry Outlook

    193 168 131 131 147 118 96 82 50 50 52 55 60 64 71 81 93 124 142 MH Wholesale Unit Shipments Industry Outlook 14 Source: 1990-2016: Manufactured Housing Institute (MHI); 2017F - 2020F Company Estimates The MH industry continues to perform at historical lows reflecting the residual impacts from the r

15. Slide 15: Growth in Housing Market Driving Demand

    554 587 609 781 925 1,003 1,112 1,174 4,340 4,190 4,260 4,660 5,090 4,940 5,250 5,450 3,900 4,100 4,300 4,500 4,700 4,900 5,100 5,300 5,500 400 500 600 700 800 900 1,000 1,100 1,200 1,300 Existing Hom e Sales (000's)Ne w Hou sin g Start s ( 00 0's ) Growth in Housing Market Driving Demand New Housin

16. Slide 16: Marine Market Trends

    Market Trends 16 95% of powerboats in the U.S. are manufactured in the U.S. 36% of the U.S. adult population participated in recreational boating 72% of boat owners have a household income of less than $100K ~ middle-class 95% of boats on the water in the U.S. are less than 26’ in length Marine Mark

17. Slide 17: U.S. Marine Outlook

    U.S. Marine Outlook - 100,000 200,000 300,000 400,000 500,000 600,000 19 65 19 66 19 67 19 68 19 69 19 70 19 71 19 72 19 73 19 74 19 75 19 76 19 77 19 78 19 79 19 80 19 81 19 82 19 83 19 84 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20

18. Slide 18: Patrick's Marine History Timeline

    A u g . 201 6 Patrick‟s Marine History Timeline 18 L e g ac y N o v. 201 4 F e b . 201 5  Electronics Distribution First step into the marine market Strategic acquisition to gain traction in new marine markets Strategic acquisition to expand presence in RV & marine markets  Fiberglass Helms  Dash

19. Slide 19: Marine Core Competencies

    Marine Core Competencies 19  Thermoforming plastics  Dash and instrument panel assemblies  Fiberglass design, engineering and manufacturing  Electrical wiring and harnesses  CNC plugs and molds; open/closed composite molds  Aluminum fuel and holding tanks  Electronics distribution  Strategic

20. Slide 20: Product Development & Design

    Product Development & Design At Patrick Industries we are constantly striving to partner with our customers to bring new and innovative products and design solutions to market  45,000 sq. ft. Design/Innovation Center located in Elkhart, IN  Opened in March 2016  Includes 25,000 sq. ft. showroom w

21. Slide 21: Our Model

    Our Model

22. Slide 22: Focused Capital Allocation

    Use strong cash flow to reduce debt and reload growth capacity 22 Maintain efficient and flexible balance sheet through measured use of leverage to drive growth and strong ROE with prepayable debt Invest in internal growth and cost savings opportunities including geographic locations, product extens

23. Slide 23: Acquisition Highlights by Year

    2010 Acquisition Highlights 2014 Acquisition Highlights • 2 companies • 7 companies • $6MM aggregate purchase price • $72MM aggregate purchase price • $22MM annualized sales • $126MM annualized sales • Primarily RV market-based • Primarily RV market-based 2011 Acquisition Highlights 2015 Acquisition

24. Slide 24: Geographic and Product Expansion

    Geographic and Product Expansion 1 2 3 4 5 PACIFIC NORTHWEST 1 SOUTHERN CALIFORNIA • Lamination • Aluminum • FRP • Fiberglass • Paint • Solid Surface • Hardwood Products • Pressed Products • Industrial • Interior Doors TEXAS SOUTHEAST NORTHEAST • Softwoods • Paint • Solid Surface • Hardwood Products

25. Slide 25: Capital Expenditures

    $2.5 $4.2 $0.3 $1.4 $2.4 $7.9 $8.7 $6.5 $8.0 $15.4 $16.0 $4.0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017F Capital Expenditures We will continue to invest in our infrastructure to drive enterprise wide efficiency and flex our capital spend when necessary to align with our demand levels ($

26. Slide 26: Balance Sheet Strength

    Balance Sheet Strength We expect to continue to utilize our leverage and cash flows in alignment with our capital allocation strategy. We ended Q1„17 with a leverage ratio of 1.3x after completing an equity offering, which generated net proceeds of approximately $94MM. Leverage Position Trend 0.0 1.

27. Slide 27: Sales & Earnings Growth

    ​ $437 +36% $595 +24% $736 +25% $920 +33% $1,222 2012 2013 2014 2015 2016 Sales Growth Sales Sales & Earnings Growth  Sales continue to grow and outpace their respective markets, driven by acquisitions, new products and extension growth and market share gains  Net Income and EPS continue steady gr

28. Slide 28: Appendix

    Appendix

29. Slide 29: Content per Unit

    Content per Unit  Our focus on strategic acquisitions and organic growth have resulted in significant increases in our content per unit and sales outpacing our respective markets  Both RV and MH content per unit increase of 14% in Q1 2017 compared to 2016  Strategic Growth Initiatives  Acquiring

30. Slide 30: Acquisition Summary 2010-2012

    Acquisition Summary 2010 2011 2012 Quality Hardwoods Sales Blazon International Group The Praxis Group A.I.A. Countertops, LLC Infinity Graphics Décor Mfg., LLC Gustafson Lighting Creative Wood Designs, Inc. Middlebury Hardwood Products, Inc. Date of Acquisition: 01/2010 08/2010 06/2011 09/2011 12/2

31. Slide 31: Acquisition Summary 2013-2015

    Acquisition Summary 2013 2014 2015 Frontline Mfg., Inc. Premier Concepts, Inc. West Side Furniture Precision Painting Group Foremost Fabricators, LLC PolyDyn3, LLC Charleston Corporation Better Way Partners, LLC Structural Composites of Indiana, Inc. North American Forest Products & North American M

32. Slide 32: Acquisition Summary 2016-2017

    Acquisition Summary 32 2016 2017 Parkland Plastics The Progressive Group Cana Cabinetry Mishawaka Sheet Metal L.S. Manufacturing, Inc. BH Electronics, Inc. Sigma Wire & KRA Intl. Medallion Plastics, Inc. Marine Concepts Marine Electrical Products Florida Marine Tanks Date of Acquisition: 02/2016 03/

33. Slide 33: Patrick Product Lines – RV Interior

    Patrick Product Lines – RV Interior 33 Additional Supplied Products:  Exit Lighting  Ceiling Fans  Power Cords & Inlets  RV Tank Heater Pads  Fire Extinguishers  Electric Fireplaces  Wiring, Electrical & Plumbing Products  Inverters  Tire Pressure Monitors  Electrical Switches, Receptacles

34. Slide 34: Patrick Product Lines – RV Exterior

    Patrick Product Lines – RV Exterior 34 Exterior Speakers Paint & Paint Mask LED Lighting Aluminum & FRP Side Walls Laminated Side Walls Additional Product Lines:  Softwoods  Full Body Paint  Aluminum Gauges  Steel Gauges  Mill Finish & Pre- Painted Aluminum and Steel  Slit & Embossed Steel  F

35. Slide 35: Patrick RV Products Growth Potential

    Patrick RV Products Growth Potential 35 Heating, Ventilating, Air Conditioning Window Coverings Rolled Flooring Bedding Exterior Mirrors Carpeting Windshield Wipers Holding Tanks Captains Chairs Appliances Toilets/Plumbing Water Heaters Gauges Dashboards & Components Hardware Tires & Rims Roofing In

36. Slide 36: Patrick Product Lines – MH Interior & Exterior

    Patrick Product Lines – MH 36 Interior & Exterior Decorative Lighting Fixtures Interior Passage Doors Kitchen & Bath Faucets & Sinks Gypsum (Drywall & Drywall Finishing Products) Laminate & Ceramic Flooring Fiberglass Bath Fixtures & Shower Doors Cabinet Doors & Components Microwaves Countertops Ele

37. Slide 37: Patrick MH Products Growth Potential

    Patrick MH Products Growth Potential 37 Composite Decking Carpet & Carpet Pad Hardware Alternative Roofing Insulation Lumber Windows Additional Supplied Products: • Water Heaters • Appliances • Toilets/Plumbing • HVAC Solar Panels Brackets/Braces & Hardware

38. Slide 38: Patrick Industries

    PATRICK INDUSTR

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