Slide 1: First Quarter 2014 Investor Presentation
PATRICK First Quarter 2014 INVESTOR PRESENTATION ['vasbace PATK |
Slide 2: So ae
So ae INDUSTRIES, INC. Pa, 4 R) & Al @ paTRrc K aghting Customer —(R 02 ist (@ PATRICK wy IWOOD roduts Ca => wo =D & ) " Vie . YYNAMICS| semewcnernatey ure INk@® PATRICK
Slide 3: Forward-Looking Statements
Sy = =| Forward-Looking Statements This presentation contains certain statements related to future results, or stafes 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
Slide 4: Patrick Industries Highlights
BSSEEET LIE Patrick Industries Highlights Patrick is a leading national manufacturer and distributor of a wide variety of building and component products for the RV, MH and Industrial markets. Strong leadership team and key players - top to bottom alignment and entrepreneurial culture Solid balance
Slide 5: Patrick Industries Overview
Patrick Industries Overview «Leading national RV market: 76% of 31M’ 14 revenues | supplier serving the - Includes laminated panels, countertops, RV, MH & Industrial wrapped mouldings, cabinet doors, markets wiring/electrical/plumbing, furniture, interior passage doors, exterior graphics, interior l
Slide 6: Patrick Facility Profile
Patrick ‘ac ty Profile Patrick's nationwide network of manufacturing and distribution centers reduces in-transit delivery time and cast to our customers # of Centers (as of 03/30/14) Manufacturing 18 Distribution 15 PATRICK
Slide 7: Sales Concentration By Market
Sales Concentration By Market The Increaee in wholesale unit shipments in the RV market, new product _ Introductions, and the impect of ecquisitions over the last 4 years contributed | | to an increase in our RV market sales concentration. >) 2012 Actual industry 2013 Actual Industry Q1’14 Actual In
Slide 8: RV Market Growth Factors
RV Market Growth Factors Market Growth RV sales will continue to benefit from the aging baby-boomers + Buyers aged 35 to 54 are the largest growing segment of RV owners Rate of RV ownership is highest in the age range of 55 and 70. = Number of consumers between the ages of 55 and 70 projected to rea
Slide 9: RV Industry Shipment Trends
RV Industry Shipment Trends Afar a dramaGic rebound in 2010 from a 58% decline in unit shipments during the = —_— perded 2003-200, the RY indualey has experienced steady grow’. Trendad alkipmeat es _ fevels indicate that there continues to be potential for future growth based on the depth = Of the l
Slide 10: RV Content Per Unit
ati MEET: Content per Unit ($) $1,550 $1,450 $1,350 $1,250 $1,150 $1,050 $950 $850 $750 $650 $550 $450 $350 $250 RV Content Per Unit With market share gains, new products and extension growth, and acquisitions, our RV unit content hee grown 19% since Q1 of ‘13. “Based on TTM Average PATRICIC Te $s S
Slide 11: MH Market Growth Factors
MH Market Growth Factors Market Growth Financing/ credit availability There is opportunity for moderate year-over-year growth, with limited downside risk in the near-term, if volumes maintain their historical relationship with new housing starts = Unit shipments have averaged about 10% of single-fam
Slide 12: MH Shipment Trends / Residential Housing Starts
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 —_ a in the MH industry everaged approximately 10% of the level of single-family es
Slide 13: MH Shipment Trends
BRSEEES III) MH Shipment Trends The recent decline and subsequent rebound in the MH Industry has been impected by the residential housing crisis and related factors, some of which were very siniler to those thet caused the MH market to collapse in 1909. Shipments (000's) 400 350 300 250 200 150 100
Slide 14: MH Content Per Unit
MH Content Per Unit Our content per unfit ahipped hes ressained felriy coneletent deapite the impact of | = __ verlical Integration by our largest MH customer In prior periods. We believe we are wel- a poslloned to pardeipate in the continued expected leprovement of Gils Industry. = =a = & #039;s Sold
Slide 15: Industrial Market Growth Factors
Industrial Market Growth Factors Drivers of Consumer Demand Market Growth New residential Consumer Existing housing Demand home sales construction + 57% of Company's industrial revenue base tied directly to residential housing market + National Association of Home Builders (NAHB) predicts a 17% incr
Slide 16: New Housing Starts Trends
New Housing Starts Trends - We estimate thet approximetely 57% of our industrial revenue bese le | Ged to the resiiental market which to have io — mon | Ke recovery. Our products have applicability in both new construction and & remodel markets. ss 2500 - 2,068 > 2,900 S 1,801 8 £ 1500 1,457 1477 a
Slide 17: Acquisition Strategy
Acquisition Strategy = We target organizations with: o Solid management teams o High quality product lines = co Strong customer and supplier relationships = Patrick provides the acquired businesses with: co Opportunity to allow the creative entrepreneurial sprit of each to continue to thrive co Capi
Slide 18: Acquisition Highlights (2010-2013)
Acquisition Highlights (2010-201 3): = 12 companies = $60MM aggregate purchase price = $170MM annualized sales = Primarily RV industry-based PATRICK
Slide 19: Acquisition Summary (2010 - 2013)
Acquisition Summary (2010 — 2013) Completed e Sales’ g Pe ADORN: ©) 01/2010 Quality Hardwoods Sales $2.0 MM $2MM Manufacturing RV Cabinet Doors = Wiring, electrical, plumbing, 08/2010 Blazon International Group $3.8 MM $20MM Distribution RV&MH and other building products [= ~ Le. Painted countertops
Slide 20: Acquisition Summary (2010 - 2013) (continued)
Acquisition Summary (2010 - 2013) (continued) = be = Date Net Purchase| Annualized Ss GEES Price Sale: g = E ~ Foe) RV,MH & Fiberglass hath fixtures 09/2013 Frontline Mfg., Ine $5.2MM $15MM — Manufacturing — Industrial including tubs and showers CJ RV, MH & 09/2013 Premier Concepts, Inc $2.8MM — $10
Slide 21: Financial Review
SOU Ea March 30, 2014 Financial Review PATRICK Weehiselis
Slide 22: First Quarter Financial Summary
First Quarter Financial Summary Patrick Industries 1st Quarter 2014 Results = Sales =| Net Sales $ 170,150 $ 142,120 Cost of Goods Sold 143,003 84.0% 119,684 84.2% Gross Profit 27,147 16.0% 22,436 15.8% Warehouse & Delivery 6112 3.6% 4536 3.2% Selling, General, & Administrative 8,500 5.0% 6,969 4.9%
Slide 23: Balance Sheet Summary
Balance Sheet Summary Trade Receivables, net 42,042 $ 22,644 $ 32,955 Inventories 59,680 56,510 52,355 Other Currert Assets 5,147 8,545 5,297 Property, Plant & Equipment, net 41,721 42,117 36,628 Goodwill 16,495 16,495 10,362 Intangible Assets, net 24,824 25,611 18,700 Other Non-Current Assets 2,163
Slide 24: Cash Flow Summary
Three Months|Three Monti . 3/30/2014 3812013 Cash Flows From Operating Activitie Se Net income $ 6596 $ 6,019 & Depreciation & amortization 2411 4,807 te . Deferred financing amortization 87 86 vee Stock compensation/defered compensation/DT A/other 4,726 3.698 Changes in operating assets & liabiliti
Slide 25: Net Sales
MEEEESEEIE1i 1; (millions) $700 $600 $500 $400 $300 $200 $100 Net Sales $437 $308 ORV MMH Mlindustrial eiiiriy} + 1Q ‘14 sales increased 19.7% RV: 21% revenue increase & 76% of 10'14 sales MH: 12% revenue increase & 13% of 10'14 sales Industrial markets: 24% revenue increase & 11% of 10'14 sales RBP
Slide 26: Gross Margin Trends
SEEEEA E17; Gross Margin Trends Our gross margins have been improving consistent with our acquisition and strategic growth plans. We do experience quarterly variability in groes margins besed on commodity pricing and competitive merket conditions. 18% 16% 14% ge Percentay 12% 10% 8% 6% 17.0% 15.8% 1
Slide 27: Net Income & Diluted EPS Summary
MEEPS EEIE/ Net income & Diluted EPS Summary (Reported / Adjusted) 2011 - Q@1 2014 Net Income Net Income — Adjusted* (millions) n (millions) $35.0 !—eoan | $35.0 $30.0 $30.0 $25.0 $25.0 $20.0 $200 $15.0 5 $15.0 ‘ g $10.0 7 $50 7 0 2011 2012 2013, Q113) Q1 14 $0.0 A 2011 2012-2013, 113 aid Diluted EP
Slide 28: Supplementary Schedules
aE Si Supplementary Schedules (6In thousands) 2011 2012 2013 1Q'13 1Q'14 Reported net income (GAAP) $ 8470] $ 28,095] $ 24,040 | $ 6019] $ 6,896 Adjustment factors: Write-off unam ortiz ed dis count on subordinated notes o 685, o o o Premiums paid on prepayment of subordinated notes 0 263 0 0 o| & G
Slide 29: Leverage Position
Leverage Position Our leverage position improved significantly since the recession and we have = ample cushion to increase leverage to support our future growth opportunities a in conjunction with our capital allocation strategy and strategic pian. Leverage Position Trend =. tes & cs Leverage (Funde
Slide 30: Stock Price Trend (Jan. 2011 - Apr. 2014)
= Stock Price Trend (Jan. 2011 - Apr. 2014) = = = Our stock price performence has experienced dramatic growth and has & = Gended consistent with our operating and financial results. & Monthly Closing Stock Price Trend fue gatas Clasing Stock Price Patrick has 10.7 million shares outstanding and a ma
Slide 31: Stock Trading Volumes (Jan. 2011 - Apr. 2014)
MEEEESERIE1i 1; Stock Trading Volumes (Jan. 2011 - Apr. 2014) Our monthly trading volumes spiced in fiecal 2012, end while volumes declined from those levels in 2013, we are sill seeing solid average dally vokmes at much higher share prices. Monthly Stock Trading Volumes 5,500,000 4,950,000 |’ pa07.
Slide 32: Patrick's Products and Segments
SOU Patrick’s Products and Segments Piel:
Slide 33: Patrick's Manufactured Products
APSE E ILI 7. ry, ADORN Gravure Ink @ Manufactured fo} = Wii Patrick’s Products ew PATRICK
Slide 34: Manufactured Products
MERE E EL s VVVVVVYVVV v Manufactured Products > Made-to-order laminated products including vinyl, paper, veneers and high pressure laminates (HPL) > ‘Cutto size, boring, failing &edge- Banding Solid surface, granite & quartz countertop fabrication Wrapped profile mouldings Cabinet doors & component
Slide 35: Manufactured Products
“Manufactured Products | > Made-to-order laminated products i | tag a | | | | i} Ul | —— } high pressure laminates (HPL) > Cutto size, boring, failing & edge- banding Solid surface, granite & quartz countertop fabrication Wrapped profile mouldings Cabinet doors & components Hardwood furniture Counte
Slide 36: Patrick's Distribution Products
MEEEESEEIE1i 1; P) PATRICK Diners butter Patrick’s Distribution Products PATRICK Gustafson Lighting eiiiriy}
Slide 37: Distribution Products
VVVVVVVVVVVV Distribution Products Pre-finished wall and ceiling panels vale Drywall & drywall finishing products “a Electronics Wiring, electrical & plumbing products Interior & exterior lighting products Interior passage doors Recliners, mattresses & other furniture Roofing products Laminate floor
Slide 38: Distribution Products
Distribution Produ 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 Laminate ceramic flooring Cement sidin
Slide 39: Information Contacts
Information Contacts Andy Nemeth Chief Financial Officer (574) 294-7511 nemetha@patrickind.com Julie Ann Kotowski Director of Investor Relations (874) 294-7511 kotowskj@patrickind.com Analyst Coverage CJS Securities Daniel Moore dmoore@cjs-securities.com Sidoti & Company, LLC Scott Stember sstember@