LCI Industries has reported its second quarter results for 2018 showing net sales of $684 million, a 25 percent year-over-year increase. Net income was $47.2 million. Also, content per motorhome increased $366 year-over-year, or 18 percent, to $2,438 in the second quarter.
“We continued to see strong sales growth in our engineered components for the recreation and industrial products as reflected in our record $684 million sales for the second quarter,” said LCI’s CEO, Jason Lippert. “Aftermarket and adjacent OEM market sales both grew over 50 percent for the quarter, aided by recent acquisitions. Adjacent OEM market sales grew to $168 million for the quarter, up 54 percent from the second quarter of 2017. Aftermarket sales rose to $68 million in the second quarter of 2018, up 51 percent from the second quarter of 2017. The outdoor lifestyle continues to gain momentum as RV demand remains strong with retail sales at historically high levels again in the second quarter.”
“Although operating margin improved in the second quarter of 2018 from the first quarter of 2018, raw materials inflation, due to the worldwide rising commodity prices that have occurred primarily from tariffs and tariff speculation, more than offset the margin improvement from our operational and pricing initiatives,” said Scott Mereness, LCI’s president.
Net sales from acquisitions completed by the company over the 12 months ended June 30 contributed $64 million in the second quarter of 2018. The organic growth rate was 14 percent for the second quarter and acquisitions provided the remainder of the 25 percent increase. Through continued focus on aftermarket channels for the company’s products, LCI increased net sales to the aftermarket in the second quarter of 2018 by 51 percent to $68 million.
LCI’s content per travel trailer and fifth wheel RV for the twelve months ended June 30 increased $308 to $3,412, compared to the 12 months ended June 30, 2017, of $3,104. This is the largest increase in five years for travel trailer and fifth wheel RV content.
At June 30, LCI’s cash and cash equivalents balance was $18 million, a decrease of $8 million from its balance of $26 million at the beginning of the year, primarily as a result of $55 million for capital expenditures and $29 million of dividend payments in excess of cash generated from operations in 2018. Additional borrowings increased the company’s outstanding debt to $215 million at June 30 primarily to fund $153 million of acquisitions.
