Lci Industries · NYSE:LCII
Lci Industries — Investor Presentation (November 2024)
34 slides from Lci Industries's investor presentation, Nov 18, 2024
Slide 1: LCI Industries Investor Presentation November 2024
LCI Industries Investor Presentation May 2022 1 LCI INDUSTRIES INVESTOR PRESENTATION November 2024
Slide 2: Forward-Looking Statements
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 manag
Slide 3: LCI at a Glance
LCI at a Glance Global leader in supplying engineered components to the outdoor recreation and transportation markets * See the Appendix to this presentation for reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. Key Metrics Q3 2024 YOY Q3 Change F
Slide 4: LCI at a Glance
LCI at a Glance Over the last three decades, LCI has strategically diversified operations into the RV adjacent market, aftermarket and marine industry; leaning into outdoor lifestyle movement * See the Appendix to this presentation for reconciliation of non-GAAP financial measures to the most direct
Slide 5: LCI Overview: brands and core competencies
LCI Overview Our industry-leading brands and core competencies 7 Core Competencies Metal Fabrication & Welding Lamination Glass Fabrication Cut & Sew Power & Motion Systems Electronics Plastics Forming Applicable Across a Number of Customer Segments Recreational Vehicle Marine Transit & School Bus E
Slide 6: LCI Overview: key differentiators
LCI Overview 6 Multiple key differentiators advancing our leading position throughout our markets • Experienced leadership team with substantial industry knowledge • Centralized base in Indiana keeps leadership close with team members, supporting cohesive culture • 100,000+ retail customer interacti
Slide 7: Expanding Addressable Markets
Expanding Addressable Markets $12 billion in combined growth opportunities driven by our focus on innovation, customer satisfaction, and strategic M&A Unlocking value through diversification: (1) "Market Opportunity" amounts represent Management's estimate of the size of the addressable market based
Slide 8: Key Strategic Opportunities
Key Strategic Opportunities Our long-term growth is guided by execution against five strategic pillars: 8 INNOVATION AS A CULTURE QUALITY LEADERSHIP & CULTURE CUSTOMER EXPERIENCE SAFETY
Slide 9: Innovation Driving Growth
Customers are adding new products showcased at Open House to latest RV models, supporting content growth Innovation Driving Growth 9 New Porch Concepts Dealer/Customer Ride-Alongs: Helux Pin Box, TCS & ABS Experiences Larger Window and Glass ApplicationsNew Patented Bi-Fold Sundeck
Slide 10: Dedication to Quality
Dedication to Quality Reputation for safe and reliable products enabling continued market share growth • Quality of our products leads to reduced warranty expenses and strong customer relationships, driving new business to increase our market share Focus on automation to maintain quality while suppo
Slide 11: Leadership & Culture
Leadership & Culture We strive to drive superior returns to all of our teams...our PEOPLE, our CUSTOMERS and our SHAREHOLDERS 1 1 Striving to Lead • A passion to win, coupled with a robust growth strategy, drives us to be a leader in every market we enter • Strong cultural underpinning has helped re
Slide 12: Improving the Customer Experience for all
Improving the Customer Experience for all • Employing listening strategies across various customer touch points including end consumer, dealer, and OEM to create meaningful and desired improvements to products, processes, and services • Supporting nearly two million interactions through our Customer
Slide 13: Prioritization of Health & Safety
Utilizing "Take 5" safety rally cry across Lippert • Company-wide initiative for all Lippert team members to take 5 seconds to Stop, Identify, and Assess hazards within daily duties • Emphasizes importance of controlling and communicating risk at all levels, creating a safer working environment and
Slide 14: ESG Focus Areas
ESG Focus Areas Driving long-term value creation through progress on ESG initiatives. Commitment to Sustainability Data monitoring and clean energy investment • Disclosure of scope 1 and 2 greenhouse gas emissions and data on energy consumption, waste management and recycling; CSR reported with refe
Slide 15: Our Business
OUR BUSINESS
Slide 16: NA RV OEM Net Sales
NA RV OEM Net Sales (in thousands) 16 North American RV OEM Performance & Key Drivers • Gaining market share year-to-date in top 5 RV OEM product categories -- appliances, awnings, chassis, furniture, and windows • New product introductions remain a key driver behind content expansion • Lippert comp
Slide 17: Innovation Driving RV Content Growth, Share Gains
Innovation Driving RV Content Growth, Share Gains 17 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, in
Slide 18: Marine OEM - Net Sales
18 Marine OEM - Net Sales Marine OEM Net Sales (in thousands) Performance & Key Drivers • Marine industry pressured by current dealer inventory levels, inflation, and elevated interest rates impacting retail customers • Focused on continued innovation in the marine markets with products like our sha
Slide 19: Aftermarket Segment
Performance & Key Drivers • Automotive aftermarket continues to drive performance, offsetting the RV and Marine aftermarkets which remain softened • Driving growth with retail partnerships to promote brand recognition • Meeting heightened repair and replacement demand as RV ownership has reached rec
Slide 20: Adjacent Industries - Net Sales
Performance & Key Drivers ◦ Expanding presence in transportation and building markets through new and existing product offerings that support an array of end markets: ▪ Supplying axles to top trailer brands, which produce 500K+ utility and cargo trailers annually ▪ Adding windows in off-road vehicle
Slide 21: International Business - Net Sales
21 International Business - Net Sales Performance & Key Drivers • European RV and marine markets have softened, partially offset by sustained strength in rail market • Focused on expanding market share in the international RV, Marine, and Rail markets using the same products and playbook that made u
Slide 22: Financial Overview
Diversification and content expansion enabling market share gains and strong cash generation Financial Overview * See the Appendix to this presentation for reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures. 22
Slide 23: Q3 2024 Financial Performance
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. 23 -5% +38% +110 bps +8%
Slide 24: Leveraging Strengths to Win Market Share
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 bu
Slide 25: Liquidity and Cash Flow
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 $80M Debt / Net Income (TTM) 6.3x 18.4x Net Debt/EBITDA (TTM)(2)
Slide 26: Capital Deployment Strategy
Capital Deployment Strategy Financial Overview Acquisitions that align to strategy and financial targets Disciplined reinvestment to drive growth Return capital to shareholders Reduce leverage Attractive dividend yield Opportunistic share repurchases Target net debt / EBITDA leverage of 1.5x Histori
Slide 27: Acquisition Strategy
Over 75 acquisitions • Majority of last 30 acquisitions focused outside of North American RV industry Looking for: • Great leadership • Product innovation • Consistency with our core manufacturing disciplines • Favorable competitive landscape • Opportunities in RV, Aftermarket, Marine, and Transport
Slide 28: Appendix
APPENDIX
Slide 29: Consolidated Financials
Consolidated Financials Appendix ($ in millions except per share data) 2017 2018 2019 2020 2021 2022 2023 Net Sales $ 2,148 $ 2,476 $ 2,371 $ 2,796 $ 4,473 $ 5,207 $ 3,785 Operating Profit $ 214 $ 199 $ 200 $ 223 $ 398 $ 553 $ 123 % of Sales 10.0% 8.0% 8.4% 8.0% 8.9% 10.6% 3.3% Net Income $ 133 $ 14
Slide 30: Balance Sheet
Balance Sheet Appendix *Debt increase in 2019, 2020, and 2021 due to funding acquisitions and liquidity for COVID-19 shutdowns. ($ in millions) 2017 2018 2019 2020 2021 2022 2023 Cash & Equivalents $ 26 $ 15 $ 35 $ 52 $ 63 $ 47 $ 66 Accounts Receivable 82 122 200 269 320 214 215 Inventory 275 341 39
Slide 31: EBITDA Reconciliation of Non-GAAP Measures
EBITDA Reconciliation of Non-GAAP Measures Appendix EBITDA is a non-GAAP performance measure included to illustrate and improve comparability of its results from period to period. EBITDA is defined as net income before interest expense, provision for income taxes, and depreciation and amortization e
Slide 32: Leverage ratio (net debt to EBITDA)
Leverage ratio (net debt to EBITDA) Reconciliation of Non-GAAP Measures Appendix The Leverage Ratio (or Net Debt to EBITDA ratio) is a non-GAAP measure of the use of debt. The Leverage Ratio is calculated by dividing the total of long-term indebtedness, plus current portion of long-term debt, less c
Slide 33: Free cash flow
Free cash flow Reconciliation of Non-GAAP Measures Appendix Free cash flow is a non-GAAP measure of liquidity, calculated by subtracting capital expenditures from net cash flows provided by operating activities. The Company considers free cash flow to be a profitability and liquidity measure that pr
Slide 34: Industry Statistics Summary
Appendix LCI Industries Industry Statistics Summary TOTAL RECREATIONAL VEHICLES (RV) TOTAL | Wholesale Units 7 [ Retail Units © [ Dealer Inventory Impact Month YI i Month YD hit Month ID i = 19,907 1%—~=«9S, 208 —-18% <493,268 47,560 446,626 21% 448,626 —~=SCS*S*C«i TSS 20,405 “62% 20.408" 62% 460,3
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