Slide 1: Investor Presentation
INVESTOR PRESENTATION March 15, 2016 Industries, Inc. NASDAQ: PATK
Slide 2: Forward-Looking Statements
rd-Looking Statements s presentation contains certain statements related to future results, or states intentions, beliefs and expectations or predictions for the future which are ward-looking statements as that term is defined in the Private Securities ‘igation Reform Act of 1995. These forward-look
Slide 3: Company Overview
Company Overview
Slide 4: Brands
Brands Up PATRICK INDUSTRIES. INC. Cav Ty Gl @PolyDyn* Yipecon} Gravure Ink & (@Parkiand Performance” Panels
Slide 5: Patrick at a Glance
k at a Glance ounded in 1959 and incorporated in Indiana in 1961 adquartered in Elkhart, Indiana- the “RV Capital of the World” eading national manufacturer and supplier of building and component products to the RV, MH, and Industrial markets Operates over 60 facilities in 14 states Approximately 3,
Slide 6: Patrick Industries Overview
Patrick Industries Overview > 75% of 2015 Net Sales > ineludes walliceiling panels, ‘countertops, fabricated aluminum & FRP products, wrapped mouldings, Cabinet doors, electrical/wiring/ plumbing, furniture, interior doors, RV painting, lighting, wall coverings, fiberglass caps, bath fixtures & smal
Slide 7: Why Patrick Industries
Why Patrick Industries Business Model Leadership Operations Financial Performance Shareholder Returns + $16.8 billion addressable expanding RV & MH markets + Emerging industrial and housing market * Continuously expanding product and company portfolio through organic growth and growth through acquis
Slide 8: Patrick Facility Profile
Slide 9: Sales & Earnings Growth
& Earnings Growth Sales cept per sh s) Sales Growth | Earnings Growth 2s +25 $272 $220 ore 5726 28 ae $555 a8 $143 +2! $133 +30! sar poss J Ll sales > Sales continue to grow and outpace their respective markets, driven by. acquisitions, new products and extension growth, and market share gains > Net
Slide 10: The RV Market
The RV Market
Slide 11: RV Industry Conditions & Consumer Trends
RV Industry Conditions & Consumer Trends Industry Strength Retail shipments have outpaced wholesale shipments allowing for healthy dealer inventories ‘5 wraps up 6" consecutive year of wholesale shipment growth with Gprojected to have slow and steady growth of 2% innovative designs and products appe
Slide 12: RV Industry Annual Shipment Trends
RV Industry Annual Shipment Trends (Shipments in thousands) RV Wholesale U Ss! ments 1 Attacks Residential Housing Crisis Gultwar eo eS Wee FIPS Oy OpFoghiF econ Consumer Confidence —o— RV Annual Shipments The RV industry has experienced steady growth over the last five years following a 58% decline
Slide 13: RV Shipments
ipments 212 Ey 2014 2015 mms Towable Shipments SEB Motorized Shipments ~~ Patrick RV Sales wable RVs Motorized RVs > 89% of industry unit sales (on avg. since 2010) > 11% of industry unit sales (on avg. since 2010) > 61% of retail dollar sales, or $9.4 billion > 39% of retail dollar sales, or $6.0 b
Slide 14: RV Towable Shipments
RV Towable Shipments (__[IRioleestetowablacriomencs in tnousands) a 38 = 2 = 8 7 2 ne 2% 2% 24 2016 [(etmucl Tralee eTraw Tralee -Fth Whee! efoting CompngTalles —eTruckCampers ] Travel Trailers— Fifth Wheel > 70% of towable unit sales (on avg. since 2010) > 25% of towable unit sales (on avg. since 2
Slide 15: RV Motorized Shipments
RV Motorized Shipments {__)Riiolesale motorized shipments (in thousands) [7] 38 0% 45% 2012 ED 204 ([[eCawertional(CassA)eWini(GheG evanCanper (cues) ] Conventional (Class A) Van Campers (Class B) > 50% of motorized unit sales (on avg. since 2010) > 7% of motorized unit sales (on avg. since 2010) >
Slide 16: Retail vs. Wholesale - '15 vs. '14
Retail vs. Wholesale - ‘15 vs. ‘14 (Shipments in thousands) RV Towables Tota! Towables- Travel Trailer Towables. Fifth Whee! on se 733 of 2015 towable shipments 2386 0f 2015 towableshipments RV Motorized -Total Motorized -Class A Motorized -Class BBC a 468 of 2015 motorized shipments 19496 of 2015 m
Slide 17: RV Content per Unit
RV Content per Unit $5,600 $1,845 aon EEE E = $1,048 i ill J I Ul oe se > RV unit content increased 20% YoY + Driven by new products, extension growth, acquisitions, and market share gain > Total potential RV content available estimated at $5,600 ‘Calculatedon TMM basis,
Slide 18: Patrick Product Lines — RV Interior
Patrick Product Lines — RV Interior Closet & Passage Doors Fiberglass Bath Fixtures, Cabinet Doors Mattresses & Shower Doors. kitchen & Bath Electronics Microwaves Fagcats 6 sinks. Laminated Panels & Vanity ti fee nity Mirrors samme Printed Vinyl Fronts & ener ‘Countertops Ceramic Backsplashes Speak
Slide 19: Patrick Product Lines — RV Exterior
Patrick Product Lines — RV Exterior Front and Graphics Bow Trusses Exterior Speakers Rear Caps Additional ProductLines: = Softwoods + Full Body Paint + Aluminum Gauges + SteelGauges + MillFinish& Pre- Painted Aluminumand Steel + Slit & Embossed tee! + FRP Coil& Sheet RV Power Cords & inlets RV Grill
Slide 20: Patrick RV Products Growth Potential
Patrick RV Products Growth Potential insulation =
Slide 21: The MH Market
The MH Market
Slide 22: MH Market Quick Facts
larket Quick Facts Average structure cost per sq. ft. (2014): $45 (MH) vs. $97 (single mily home) erage MH retail price (2014): $65,300 for 1,440 sq. ft. Multiple exterior options and interior floor plans available; customized to meet consumer needs > Engineered for wind safety and energy efficiency
Slide 23: MH Market Indicators
MH Market Indicators rivers of Consumer Demand Market Growth Quality credit, standards aler and anufacturer inventor Affordability and quality Alternative Number of housing aging "Baby availability Boomers pater Consumer nfidence availability bs é cont Consumer Demand Tax incentive: > Opportunity fo
Slide 24: MH Annual Shipment Trends
MH Annual Shipment Trends (Shipments in thousands) MH Wholesale Unit Shipments Residential 168 Housing Crisis > a Restricted and Residential — 118 Housing Credit& Lending Conditions 131131 = a The MH industry continues to perform at historical lows reflecting the residual impacts from the residentia
Slide 25: MH Shipments
MH Shipments (Sin millions) shipments fm thousands) 418% ‘129 14% ‘109 12% ‘35 15% 10% Ses s7a s73 sm sa 10% “is “7% 74 10% 60. ka 56 s coe s & sm Wholesale Units Patrick MH Sales > Wholesale unit shipments continue to increase YoY - up 10% > Patrick MH segment sales are up 18% YoY led by acquisitio
Slide 26: MH Content per Unit
Zontent per Unit Content per Unit $6200 014 sons zat mg conte enn STR a sons zat mg conte enn STR increase = $97 per year, CAGR 6% i 2 192 s1ge2 lll LLL aN ct oo are eo cat oat og? ar ca? car? ort co gat owd® rp? ca? out? > RV unit content increased 8% YoY = Driven by new products, extension growth,
Slide 27: Patrick Product Lines — MH
Patrick Product Lines — MH Kitchen&Bath FiberglassBathFixtures& Shower Gypsum (Drywall Faucets & Sinks Doors Drywall Finishing vicars Presa Products) ped Profile Moldings Plumbing Product | riorDecorative Ceiling Fans Trusses Singise Ventilation System& Ridge Cap FeltPaper Ice & Water Protection Dri
Slide 28: Patrick MH Products Growth Potential
Patrick MH Products Growth Potential Alternative Insulation Solar Panels Roofing Hardware Composite ee + WaterHeaters + Appliances + Toilets/Plumbing Brackets/Braces@ = * «HVAC Hardware mPATRICK
Slide 29: The Industrial Market
The Industrial Market
Slide 30: Industrial Market Indicators
Industrial Market Indicators Market Growth rowth in Housing Market Driving Demand New construction s10 growth n 490 2 = sq 3 arm 8 2 450 2 z Ae growth 3 am 8 Government incentives > 48% of the Company's industrial revenue base is tied directly to the residential housing market (new construction and
Slide 31: Residential & Non-Residential Trends
Residential & Non-Residential Trends (Sn millions) (housing starts in thousands) non-res constiuetion spend, YoY chg. 320% sit 19% 430% yy S70 2% 413% 0% on 419% $52 % pis aa sis 48% a0 Ss 7m 4,002 25 He 14% — 3 09 58 mm Residential Housing Starts Patrick industrial Sales > Our products have applica
Slide 32: Housing Starts Trends
ousing Starts Trends 1213 'S, Census Bureau; 2016F: NAHB (as of March?, 2016)
Slide 33: Industrial Organic Growth
Industrial Organic Growth Markets residential housing Legacy Industrial Organic Sales Growth* etail, commercial, hospitality and institutional (Sin milions $90.0 Product Types om0 er and vinyl laminated panels smo igh pressure laminate (HPL) Fabricated and contour banded parts $60.0 $60.0 Industrial
Slide 34: Strategy Execution
Strategy Execution
Slide 35: Capital Allocation
Capital Allocation Acquisitions Geographic and product expansion Stock buyback program « At prices and volumes deemed appropriate by the Board and management > Investments in infrastructure and capital expenditures > Debt reduction and leverage position = We expect to utilize availability under our
Slide 36: Acquisition Strategy
isition Strategy janizations with: agement teams with strong customer and supplier relationships and operational talent ality product lines Strong growth potential Strategic value proposition to our business model Patrick provides the acquired businesses with: = Opportunity to allow the creative ent
Slide 37: Acquisition Summary by Year
Acquisition Summary by Year 2010 Acquisition Highlights ‘ompanies aggregate purchase price imarily RV market-based +7 companies + $72MM aggregate purchase price + $126MM annualized sales 2014 Acquisition Highlights + Primarily RV market-based 2011 Acquisition Highlights + 3 companies + $7MM aggregat
Slide 38: Parkland Plastics, Inc.
nd Plastics, Inc. [(G@rarianc Performance Panes arkland Plastics (headquartered in Middlebury, IN) was acquired in February 2016 = Purchase price $25 million | $30 million annualized net sales = Immediately accretive to 2016 netincome per share > Products: « Pioneerin utilizing reclaimed polymers to
Slide 39: Progressive Group
rogressive Group THE PROGRESSIVE ,\ Group Al he Progressive Group acquired in March 2016 Purchase price $11 million | $23 million annualized net sales Immediately accretive to 2016 netincome per share Operating out of 7 locations serving 16 states, primarily in the Midwestand Inter- mountain regions
Slide 40: Geographical & Product Expansion
Geographical & Product Expansion Northeast Softwoods, Pacific Northwest + Fiberglass Lamination Solid Surface + Aluminum + Hardwood Products FRE + Slotwall Products + Fiberglass + Paint Solid Surface + Hardwood Products + Pressed Products + Industrial Southeast | Interior Doors Southern California L
Slide 41: Stock Buyback
Stock Buyback = es 1,800 4 ‘$40.00 — $35.00 3 4.200 1128 2 _e & 1,000 25.04] : nm : sis 6 600 * = o mal $0.00 : 5 z a e > Repurchased 1.8 million shares since February 2013 through January 2016 = Average cost per share of $25.04 --- total cost $46 million > New stock repurchase program announced in
Slide 42: Capital Expenditures
Capital Expenditures (Sin thousands) $10,900 $8,669 $7,895 $7,958 $6,542 Recession | | $2436 $1,358 = | Ll 2008 2009 2010 2011 2012 2013 2014 2015 2016F We will continue to invest in our infrastructure to drive enterprise wide efficiency and flex our capital spend when necessary to align with our de
Slide 43: Funding Growth with Cash Flows
Funding Growth with Cash Flows (Sin thousands) 2011 2012 2013 2014 2015 Flows From Operating Activities: income $ 8,470 | $28,095 | $24,040 | $30,674 | $ 42,219 epreciation & amortization 4,916] 5,586] 7,207| 10,433] 16,775 Deferred financing amortization 995 543 430 365 490 Stock compensation/defer
Slide 44: Capital Allocation
Capital Allocation (Sin millions) $204 ($180) $36 2010 Total Acquisitions Capital Stock Debt Payments 2015 Total Debt Spending Buybacks Debt Debt increased only $168MM from 2010 to 2015 with $348MM invested in capital allocation strategy over that time period
Slide 45: Balance Sheet Strength
Balance Sheet Strength Leverage Po: n Trend 2 @ ~~ — Saou of S72 of ea Acruistons Sue cautions > | ‘Acaustions mo ~< an 10 aa NS * We expect and continue to utilize our leverage for strategic acquisitions, followed shortly thereafter by an accelerated deleverage cycle based on strong operating cash
Slide 46: Margin Expansion
Margin Expansion (Sin millions) 18% i) 165% 16.0% 16.1% 16.2% 163% 157% 157% apaney ae 152% jsom 150% 152% 15.4 152% 194% STS Ie ge eer S sane so eearigenny gia ene ee ee J Pea” suo ” 11.8% * Troon a s120 zo s100 1 seo “ seo sao szo “ so mu $) ME Gross Margin HE Operating Income == Gross Margin % ==
Slide 47: Stock Performance
Stock Performance Split Adjusted Stock Performance $50.00 5.00 0.00 $35.00 $30.00 $25.00 + $20.00 | $15.00 + $10.00 4 - 4 12031113 1231/14 1231/15 22916 = Pre-Stock Split Close Price 1 Post-Stock Split Close Price As of December 31, 2015, our split-adjusted closing stock price was $43.50, approximat
Slide 48: Appendix
Appendix
Slide 49: Shareholder Value
Shareholder Value PATK Price and Volume 600,000 $50.00 $45.00 500,000 $40.00 400,000 SB $30.00 300,000 $25.00 $20.00 200,000 $16.00 100,000 enae A MI <° | $0.00 ard 6 6 © © F Fe s er asf 4s wos Patrick has approximately 15.2 million shares outstanding and a market capitalization of approximately $66
Slide 50: Acquisition Summary
Acquisition Summary Be 012019 Quay HerdvoodsSakes —S20NM «SQM Manufactuing == RV._Catnet Doors ® Wiring, electrical plumbing, and ce'2010__Blazen Inertial Group __$28MM___S20MIM__Distibution _RV.&MH other tuldng progucts C- Painted countertops, foam 092011 The Pravs Grup == SOSMM == «SEMM.——_—isirbu
Slide 51: Acquisition Summary
Acquisition Summary 092013 Frontline —_ Ine. 092013 Premier Concepts, Inc. 52MM $26 MM S15MM stomM Manufacturing Manufacturing RV, MH& Industrial RV, MH& Industrial Fiberglass bath fiures including tubs and showers Solid surface countertops Recliners, mattresses, other woe | ote | eee | oem Leer |e
Slide 52: Acquisition Summary
Acquisition Summary x pera RY Feat suas 022015 Better WayPariners, LLC $40.5 MM SSO MM Manufacturing RV __ Fiberglass components } ef Fiberalass front and rear caps and ‘Structural Composites of RV; Marine & roofs and other specialty fberglass 0572015 Indiana, Inc. $20.1 MM S18MM Manufacturing Indus
Slide 53: Patrick Industries, Inc.
PATRICK INDUSTRIES, INC.