Slide 1: Third Quarter 2014 Investor Presentation
rece (gPATRICIC Soe INC. Third Quarter 2014 INVESTOR PRESENTATION a
Slide 2: INDUSTRIES, ING
INDUSTRIES, ING Ow =D by, Gravure ink @ PATRICK
Slide 3: 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
Slide 4: Patrick Industries Highlights
ERED EF Patrick Industries Highlights Leading national manufacturer and distributor of a wide variety of building and component products for the RV, MH and Industrial markets Core market is the $13 billion RV industry, a 19% increase over 2012 (source: RVIA). Strong leadership team and key players -
Slide 5: Patrick Industries Overview
Patrick Industries Overview + Leading national RV market: 75% of 9M’14 revenues supplier serving the - Includes laminated panels, countertops, fabricated RV. MH & Industrial ;, wrapped mould , A. ng, furniture, interior markets 5: ol 1g, inter weES = 30 manufacturing and 16 distribution centers 4% o
Slide 6: Patrick Facility Profile
Patrick Facility Profile —— (Aa Xe [os gig } Porc’ notamulde network of manufocurng end sutton centers reduces Intron delve me and cost to ur customers. Patrick's highest concentration of manufacturing and distribution centers is located in indiana, which continues to lead the country In RV producti
Slide 7: Sales Concentration By Market
Sales Concentration By Market The increase in wholesale unit shipments in the RV market, new product introductions, and | the impact of acquisitions over the last 4 years contributed to an increase in our RV market | sales concentration. = | = = 2012 Actual Industry 2013 Actual Industry Nine Months
Slide 8: RV Market Growth Factors
RV Market Growth Factors Market Growth Number of Changing a ee aging style “Baby ge Boomers” Array of Attraction Agunallies product to younger financing choices buyers Consumer Demand Economical vacation 9 million U.S. households own an RV, a 16% increase vs. 2001 Age of typical RV owner is 48 years
Slide 9: RV Industry Annual Shipment Trends
= RV Industry Annual Shipment Trends — bss S ins The RV industry has experienced steady growth over the last four years following a 58% decline in unit & shipments during the period of 2006-2009. Trended shipment levels indicate that there continues to be = potential for future growth based on the d
Slide 10: RV Content Per Unit
RV Content Per Unit RV unit content has increased 17% compared to Q3 ‘13 — driven by new products and extension growth, acquisitions and market share gains. $’s Sold / RV Unit Shipped* 8 gees cr §& ps Q ~~ & * aes & x x 3 8 2 8 8 . | 97%, 3, Pe, Or, Pe, 9, Oe, O., PD, a, Pe, 7, 92, %., OW, Or, M,, O
Slide 11: MH Market Growth Factors
a MH Market Growth Factors Drivers of Consumer Demand Market Growth credit standards Affordability and quality V¥¢ Job growth Number of aging “Baby Boomers”, Alternative housi Financing/ Consumer credit availability > Rape Ba |rivdence Demand availal + There is opportunity for moderate year-over-yea
Slide 12: MH Shipment Trends / Residential Housing Starts
aaeiT), MH Shipment Trends / Residential Housing Starts On average over the last 40 years, approximately three-fourths of total residential housing starts have been single family housing starts. Wholesale unit shipments in the MH Industry averaged approximately 10% of the level of single-family hous
Slide 13: MH Annual Shipment Trends
MH Annual Shipment Trends = S The recent decline and subsequent rebound in the MH industry has been impacted by the = residential housing crisis and related factors, some of which were very similar to those that E caused the MH market to collapse in 1999. oot * MH Wholesale Unit Shipments is standar
Slide 14: MH Content Per Unit
= MH Content Per Unit = Ss as = Our content per unit shipped has remained fairly consistent despite the impact of vertical integration by = our largest MH customer in prior periods. We believe we are well-positioned to participate in the continued expected improvement of this industry. $’s Sold / MH
Slide 15: Industrial Market Growth Factors
Industrial Market Growth Factors = = Drivers of Consumer Demand Market Growth New construction growth New residential Consumer Existing housir Demand home sales construction Affordabl inter 56% of Company's industrial revenue base tied directly to residential housing market National Association of H
Slide 16: New Housing Starts Trends
= = ny = We estimate that approximately 56% of our industrial revenue base is directly tied to the residential housing market which appears to have begun Its recovery. Our products have applicability in both New Housing Starts (000's) 2,500 2,000 4,500 4,000 New Housing Starts Trends iiss new constr
Slide 17: Capital Allocation
Capital Allocation Our capital allocation strategy is centered around the utilization of our leverage and capital resources to grow the business model. * Capital Allocation * Acquisitions * Investments in infrastructure and capital expenditures * Debt reduction & leverage position ¢« Weexpect to uti
Slide 18: Acquisition Strategy
Acquisition Strategy = We target organizations with: o Solid managementteams o High quality product lines o Strong customerand supplier relationships = Patrick provides the acquired businesses with: © Opportunity to allow the creative entrepreneurial sprit of each to continue to thrive o Capital and
Slide 19: Growth Through Acquisition
Growth Through Acquisition Quality : Foremost Hardwoods ( (0110) The Praxis Group (08/11) we: Furniture Creative Wood (09113) Blazon a Intemational ALA, ( PolyDyn3 Group (08/10) ‘Countertops, (09/14) LLC (ogi) ision Painting Group (4 companies) (05/18) Acquisition Highlights (2010-Sept. 2014): = 18
Slide 20: Acquisition Summary (2010 - Sept. 2014)
Acquisition Summary (2010 - Sept. 2014) Date ‘Complet 01/2010 08/2010 06/2011 09/2011 12/2011 03/2012 07/2012 09/2012 10/2012 Net Purchase | Annualized Pi Sales" | Segment ADORN Quality Hardwoods Sales Blazon International Group The Praxis Group & ALA. Countertops, LLC Infinity Graphics (formerly Pe
Slide 21: Acquisition Summary (continued)
= = = Date Completed] 09/2013 09/2013 09/2013 06/2014 06/2014 09/2014 Business Frontline Mfg., Inc. «® Premier Concepts, Inc WEF. “see West Side Furniture @ a Precision Painting Group Foremost Fabricators, LLC PolyDyn 3 PolyDyn3, LLC $5.2 MM $2.6 MM $8.7 MM $16.0 MM $45.4 MM $1.3MM * Projected Annua
Slide 22: Stock Buyback
Stock Buyback Since the inception of the stock buyback program in February 2013 through 9M ‘14, we have repurchased a combined total of 580,059 shares at an average cost per share of $22.42. As of Q3 ‘14 closing, PATK stock was trading at $41.60 resulting in a 20% ROI. Stock Buyback (000) 412 ais a2
Slide 23: Financial Review
ERS EEF! September 28, 2014 Financial Review iii:
Slide 24: 3rd Quarter Financial Summary
bind Quarter Financial Summary tries 3rd Quarter 2014 Results 09/28/2014 | %toNet | 09/2913 | %toNet : $ in thousands except per share data] Act Sales Actual Sales Net Sales 188,138 146,623 Cost of Goods Sold 158,110 84.0% 124,800 85.1% Gross Profit 30,028 16.0% 21,823 14.9% Warehouse & Delivery 6,8
Slide 25: Nine Months Financial Summary
Nine Months Financial Summary Patrick Industries Nine Months 2014 Results 09/28/2014 ‘to Net 09/29/13 ‘to Net {Gn Shousantis excert perjenere dam) Net Sales 546,143 448,319 = Cost of Goods Sold 457,149 83.7% 378,900 84.5% i Gross Profit 88,994 16.3% 69,419 15.5% Warehouse & Delivery 19613 3.6% 14,53
Slide 26: Balance Sheet Summary
Balance Sheet Summary ($ in thousands) 9/28/2014 12/31/2013 9/29/2013 : Trade Receivables, net 44,076 22,644 35,518 = = Inventories 76,989 56,510 55,854 == - Other Current Assets 10,373 8,545 17,251 = Property, Plant & Equipment, net 53,663 42,117 40,113 | Goodwill 28,392 16,495 16,970 Intangible As
Slide 27: Cash Flow Summary
Cash Flow Summary leininousanggy | sasoree | canoe | 9/28/2014 9/29/2013 Cash Flows From Operating Activities: Net income $ 23,381 S$ 19,028 Depreciation & amortization 7.318 5.216 ~ Deferred financing amortization 267 312 = Stock compensation/deferred compensation TA/other ea 4529 f Changes in oper
Slide 28: Net Sales
(millions) $700 $600 $500 $400 $300 $200 $100 $308 2 2, %7 Net Sales $595 $448 $437 %, %, w 2: 7: 4 2 a % ORV @MH mindustral $546 % % PATRICK 3Q ‘14 sales increased 28.3% RV: 34% revenue increase & 73% of 30'14 sales MH: 12% revenue increase & 16% of 3Q'14 sales Industrial markets: 19% revenue incre
Slide 29: Gross Margin Trends
Gross Margin Trends Our gross margins have been improving consistent with our acquisition and strategic growth plans. We do experience quarterly variability in gross margins based on commodity pricing and competitive market conditions. Peete R RE 18% nN co 9% 15.8% 15.8% 16% 14.9% 14.6% 13.7% A7% 14
Slide 30: Net Income & Diluted EPS Summary
Net Income & Diluted EPS Summary (Reported / Adjusted) 2011 — Nine Months 2014 (millions) Net Income oye! Net Income - Adjusted s350 szaa = te $24.0 $234 $30.0 $23.6 $250 $190 $25.0 $20.0 HAL ‘$15.0 faa | $15.0 i son ss0 aa a a \és0) Zan 02 canal out mis ows OM 34 (pershare) oe EPS (pershare) Dilute
Slide 31: Supplementary Schedules
Supplementary Schedules Reconciliation of GAAP Net Income/Diluted EPS to Adjusted Net Income/DilutedEPS ($ in thousands) 2011 2012 2013 3Q'13 9M'13 3Q‘'14 9M [Reported net income (GAAP) s__847o|s 28,095|s o/s 5452] 19028| 7.254| S$ 23381 [Adustment factors: ‘White-off unamortized discount on subordi
Slide 32: Supplementary Schedules (continued)
Supplementary Schedules (continued) st = 4 (Sin thousands) 3Q 13 9M 13 3Q'14 9M Reported net income (GAAP) $ 5,452] $ 19,028| $ —7.254/ $ 23,381 [Adjustment factors. interest expense 1,615 694 1,750 Income taxes 11,662 4,542 14,637 Depreciation 3,628 1,594 4282 Amortization of intangibles 1,588 1,40
Slide 33: Leverage Position
= Leverage Position = | Ss. = Our leverage position improved significantly since the recession. We will continue to look to = utilize leverage for strategic acquisitions, followed by an accelerated deleverage cycle. ee Leverage Position Trend Acquisitions Acquistions Acquistions 20 10 50 gz 30 e B40
Slide 34: Closing Stock Price
nal | = ‘losing Stock Price Our stock price performance has experienced dramatic growth and has trended $50.00 $45.00 $40.00 | $35.00 $80.00 $25.00 $20.00 $15.00 $10.00 $5.00 | so.c0 U Stock Price Trend (Jan. 2011 - oct. 2014) consistent with our operating and financial results. Monthly Closing Stoc
Slide 35: Stock Trading Volumes (Jan. 2011 - Oct. 2014)
PE Stock Trading Volumes (Jan. 2011 - oct. 2014) 5,500,000 4,950,000 4,400,000 | 3,850,000 3 3,300,000 Volume § 2,750,000 nthly Teading 2,200,000 M 1,650,000 | 4,200,000 550,000} ° Our monthly trading volumes spiked in fiscal 2012, and while volumes declined from those levels in 2013, we are still s
Slide 36: Patrick's Products and Segments
BRR ER TTY, Patrick’s Products and Segments iiss
Slide 37: Patrick's Manufactured Products
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Slide 38: Manufactured Products
Made-to-order laminated products including vinyl, paper, veneers and high pressure laminates (HPL) > Cut tosize, boring, foiling &edge- banding Solid surface, granite & quartz countertop fabrication ‘Wrapped profile mouldings Cabinet doors & components Hardwood furniture Countertops Fabricated alumi
Slide 39: Manufactured Products
Manufactured Products so > Made-to-order laminated products including ~~ vinyl, paper, veneers and high pressure = =H laminates (HPL) > Cut tosize, boring, foiling &edge- banding Solid surface, granite & quartz countertop fabrication ‘Wrapped profile mouldings Cabinet doors & components Hardwood fur
Slide 40: Patrick's Distribution Products
| = = ES — ie &) oa TT Gustafson = Lighting PATRICK Patrick’s Distribution rier Products si L.-T), \\ SePATRICIC
Slide 41: Distribution Products
Distribution Products Pre-finished wall and ceiling panels Drywall & drywall finishing products Electronics Wiring, electrical & plumbing products Interior & exterior lighting products Interior passage doors Recliners, mattresses & other furniture Roofing products FRP sheet & coil Laminate flooring
Slide 42: Distribution Products
Distribution Produc Pre-finished wall and ceiling panels Drywall & drywall finishing products Electronics Wiring, electrical & plumbing products Jovssssese3] Interior & exterior lighting products Interior passage doors Recliners, mattresses & other furniture Roofing products FRP sheet & coil Laminat
Slide 43: Information Contacts
ERED EF Information Contacts Andy Nemeth Chief Financial Officer (574) 294-7511 nemetha@patrickind.com Julie Ann Kotowski Director of Investor Relations (574) 294-7511 kotowskj@ patrickind.com Analyst Coverage CJS Securities Daniel Moore dmoore@cjs-securities.com Sidoti & Company, LLC Scott Stember