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Patrick Industries Buys Oregon Lamination Firm

March 5, 2012 by · Leave a Comment 

Elkhart, Ind.-based Patrick Industries Inc. announced today (March 5) that it has completed the acquisition of the business and certain assets of Decor Mfg. LLC, a premier laminating operation located in Tualatin, Ore., for a purchase price of approximately $4.4 million. According to a press release, Decor primarily produces laminated and wrapped products for the Oregon recreational vehicle market.

“The Oregon market is significant in terms of RV market potential as it relates to overall Northwestern United States RV production levels, and we estimate it to be the second largest RV producing geographic sector outside of the Midwest,” stated Todd Cleveland, president and CEO of Patrick, an RV and manufactured housing supplier. “We are excited about partnering with the extremely talented management team at Decor, who have built long-standing trusted relationships with customers in the Northwest.

“They will be an asset to Patrick as we look to continue to bring value to our customers in terms of price, flexibility, proximity, innovation, quality, and an overall ease of doing business. In addition to providing opportunities for the company to increase its market share and per unit content, we believe the acquisition will afford immediate potential to establish a significant RV presence in the Northwest.”

The acquisition was funded through borrowings under Patrick’s revolving credit facility and the issuance of 100,000 shares of Patrick common stock. The company estimates Decor’s annualized 2012 revenues to be approximately $17 million.

The business will continue to operate on a stand-alone basis under the Decor Mfg. name in its existing manufacturing facility in Tualatin. Patrick currently operates a high-pressure laminate manufacturing cell for the industrial market and a distribution center for the RV and manufactured housing markets in its existing nearby Woodburn, Ore., facility.

 

 

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Acquisitions Boost Patrick’s 4Q, Full-Year Profits

February 24, 2012 by · Leave a Comment 

Patrick Industries Inc. reported an increase in sales and earnings for its fourth quarter and 12 months, boosted by acquisitions completed in 2011. The Elkhart, Ind.-based company is a leading manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets,

Net sales for the quarter, ended Dec. 31, were $78.3 million compared to $58.1 million in the same quarter of 2010, an increase of $20.2 million or 35%. The increase was primarily attributable to a 44% increase in the company’s revenue from the RV industry, which represented approximately 60% of its fourth quarter sales. The revenue improvements resulted from the contributions from business acquisitions completed in 2011, an 8% increase in quarterly wholesale unit shipments in the RV industry, additional RV market penetration, increased commodity prices, and improved retail fixture sales in the industrial market.

For the fourth quarter of 2011, Patrick reported net income of $1.5 million or $0.14 per diluted share, compared to a net loss of $0.9 million or $0.10 per diluted share in the fourth quarter of 2010. Fourth quarter 2011 net income included a non-cash charge of $0.8 million or $0.07 per diluted share related to mark-to-market accounting for common stock warrants. The fourth quarter 2010 net loss included a non-cash credit of $0.1 million or $0.01 per diluted share related to stock warrant accounting and a gain on the sale of fixed assets of $0.1 million or $0.01 per diluted share.

As previously announced, Patrick acquired Elkhart, Ind.-based Performance Graphics in December 2011. Performance Graphics, a designer, producer and installer of exterior graphics for the RV, marine, automotive, racing and enclosed trailer industries, was the company’s third acquisition of the year following the acquisition of Praxis Group in June 2011 and A.I.A. Countertops LLC in September 2011. Together, AIA and Praxis accounted for approximately $6.3 million of the sales increase in the fourth quarter of 2011. Performance Graphics did not contribute materially to Patrick’s fourth quarter 2011 operating results.

Net sales for full year 2011 were $307.8 million, an increase of $29.6 million or 11% over the $278.2 million reported in 2010. The year-over-year increase was primarily attributable to the acquisitions completed in 2011 as noted above, the acquisition of Blazon International Group in the third quarter of 2010, improved retail fixture business and improved market penetration in the RV market.

Patrick reported net income of $8.5 million or $0.83 per diluted share compared to $1.2 million or $0.12 per diluted share for the 2010 year, reflecting an increase of $7.3 million or $0.71 per diluted share. Net income for the 12 months of 2011 benefited from the impact of improved profitability at two of the company’s Midwest manufacturing divisions and the acquisitions.

To view the entire release click here.

 

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Patrick Industries Continues Acquisitive Cycle

December 20, 2011 by · Leave a Comment 

Elkhart, Ind.-based supplier Patrick Industries Inc. announced today (Dec. 20) that it has completed the acquisition of the business and certain assets of Performance Graphics, also of Elkhart.

According to a press release, Performance Graphics is a designer, producer and installer of exterior graphics for the recreational vehicle, marine, automotive, racing and enclosed trailer industries.

“The acquisition of Performance Graphics, along with the recent acquisitions of the Praxis Group and A.I.A. Countertops LLC, will allow the company to further expand its penetration into the RV and industrial market sectors and increase its market share and per unit content,” stated Todd Cleveland, Patrick president and CEO. “In addition, the acquisition presents synergistic opportunities not only for the company, but for our customers. We are excited to leverage our operational talent and expertise and financial resources to help Performance Graphics meet our customers’ graphics needs.”

Performance Graphics’ projected annualized 2011 revenues are approximately $1.7 million. The acquisition was primarily funded through borrowings under Patrick’s revolving credit facility. The business will continue to operate on a stand-alone basis under the “Performance Graphics” name in its existing manufacturing facility.

“Performance Graphics is a natural fit with Patrick’s existing RV and commercial businesses, as it affords us the opportunity to enter a new product market with significant potential as a primary local supplier that is not only complementary to our existing product lines, but will bring value to our customers in terms of innovation, price, flexibility and creativity,” said Cleveland. “Additionally, the synergies between our existing talented design department and the creative Performance Graphics team will be an asset to both our customers and our organization.”

 

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Patrick Buys Certain Assets of RV Supplier AIA

September 19, 2011 by · Leave a Comment 

Patrick Industries Inc. announced today (Sept. 19) that it has completed the acquisition of certain assets of Syracuse, Ind.-based AIA Countertops LLC, a premier fabricator of DuPont Corian countertops, backsplashes, tables, signs and other products for the RV and commercial markets, for a net purchase price of approximately $5.7 million. AIA’s projected annualized revenues are approximately $20 million.

“The acquisition of AIA is a natural fit with Patrick’s existing RV and commercial businesses as it will afford us the opportunity to gain additional penetration and foothold in the RV and industrial market sectors and bring added value to our customers in terms of innovation, price, flexibility and product offering,” said Todd Cleveland, president and CEO for Elkhart, Ind.-based Patrick Industries. “Additionally, the strength and dedication of AIA’s management team, with more than 27 years of industry and operational experience, and its solid reputation in the marketplace will be an asset to our organization as we continue to capitalize on our core competencies and execute on our strategic initiatives.”

Patrick Industries said that the acquisition was primarily funded through borrowings under the company’s revolving credit facility and subordinated financing provided by Northcreek Mezzanine Fund I L.P. and an affiliate of Northcreek, in the form of secured senior subordinated notes. Northcreek is an existing lender to and shareholder of Patrick.

In addition, certain former members of AIA’s ownership group will carry a note receivable from Patrick Industries. AIA’s current management team will continue to manage the operation under the AIA name in its existing manufacturing facility following the closing.

 

 

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Patrick Appoints Utilimaster President to Board

August 22, 2011 by · Leave a Comment 

Elkhart, Ind.-based Patrick Industries Inc., a major manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets, today (Aug. 22) announced the appointment of John A. Forbes to its board, effective Aug. 18, 2011.

Forbes, 51, is the president of Utilimaster Corp., a subsidiary of Spartan Motors Inc. based in Wakarusa, Ind. Prior to being named president in July 2010, Forbes was the CFO of Utilimaster from May 2009 to July 2010, the CFO of Nautic Global Group from 2007 to 2009, and the CFO of Adorn, LLC from 2003 to 2007.

“We are pleased to welcome John to our board, and confident that his leadership, passion, enthusiasm, and experience will be an asset to the company as we execute on our strategic plan and continue to focus on increasing shareholder value,” said Todd M. Cleveland, president and CEO.

 

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Patrick Reports 2Q Profit Increases, Sales Flat

July 29, 2011 by · Leave a Comment 

Elkhart, Ind.-based Patrick Industries Inc., a major manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets, today (July 29) reported its financial results for the second quarter and six months ended June 26.

For the second quarter, Patrick reported net income of $3.7 million, or $0.36 per diluted share, on net sales of $82.6 million, compared to net income of $1.9 million, or $0.19 per diluted share, on net sales of $83.9 million in the second quarter of 2010.

Second quarter 2011 net income included the positive impact of a non-cash credit of $0.3 million or $0.03 per diluted share related to mark-to-market accounting for common stock warrants and a net gain on the sale of fixed assets and on the acquisition of a business of $0.2 million or $0.02 per diluted share, which were partially offset by a non-cash charge of $0.2 million or $0.02 per diluted share for the write-off of financing costs related to the refinancing of Patrick’s former credit facility. This compares to the same period of 2010 that included a non-cash credit of $0.3 million or $0.04 per diluted share related to stock warrant accounting.

The increase in net income primarily reflected improved profitability at one of the company’s Midwest manufacturing divisions that had underperformed in 2010 compared to historical levels, and an acquisition completed in the third quarter of 2010. The Midwest manufacturing division benefited from margin improvements and ongoing organizational and process changes that enhanced labor efficiencies, reduced scrap and returns, and increased material yields.

Net sales for the quarter decreased approximately $1.3 million or 1.5%, primarily reflecting the impact of softer than expected conditions in the MH industry. The company estimates that unit shipments in the MH industry, which represented 24% of the company’s second quarter sales, were down approximately 15% from the second quarter of 2010. According to industry associations, wholesale unit shipments in the RV industry, which represented 60% of the company’s sales in the quarter, increased approximately 4% in the second quarter of 2011 compared to the prior year period. The industrial market sector, which is tied to the residential housing market and accounted for 16% of the company’s second quarter 2011 sales, saw a 4% decrease in new housing starts in the quarter compared to the prior year.

To read the entire report courtesy of MarketWatch click here.

 

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Patrick Industries Acquires Supplier Praxis

June 16, 2011 by · Leave a Comment 

Recreational vehicle and manufactured housing supplier Patrick Industries Inc. announced today (June 16) that it has completed the acquisition of certain assets of Elkhart, Ind.-based Praxis Group.

According to a press release, Praxis is a manufacturer and distributor of countertops, foam products, shower doors and furniture products to the RV industry with projected annualized revenues of approximately $4 million.

“We are very excited to work with the Praxis team and be afforded the opportunity to continue to bring new products to our existing customer base and potentially to other customers outside of the RV industry,” said Todd Cleveland, president and CEO for Patrick, also based in Elkhart.

He added, “The Praxis team has deep customer relationships and a highly innovative approach to the manufacturing and distribution of products within the RV industry that will provide a direct complement to our strategic focus.”

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Patrick Industries Reports 9% Q1 Sales Rise

April 28, 2011 by · Leave a Comment 

Patrick Industries Inc. today (April 28) reported its financial results for the first quarter ended March 27, 2011.

For the first quarter of 2011, Patrick reported an increase in net sales of $6 million or 9.4%, to $69.5 million from $63.5 million in the 2010 period reflecting the impact of an acquisition completed during the third quarter of 2010 and increased market penetration.

The company reported a net loss of $1.2 million or 13 cents per share in the first quarter of 2011. The net loss was impacted by non-cash charges related to the refinancing of Patrick’s former credit facility, including $600,000 or 6 cents per share for the write-off of the remaining unamortized loss on interest rate swaps that were terminated and paid off during the quarter and the write-off of $400,000 or 4 cents per share for financing costs, as well as a non-cash charge of $300,000 or $3 cents per share related to mark-to-market accounting for common stock warrants. This compares to net income of $900,000 or 9 cents per share in the same period of 2010 which included a net gain on the sale of fixed assets of $2.8 million or 28 cents per share, partially offset by a non-cash charge of $300,000 or 3 cents per share related to stock warrant accounting.

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Patrick Industries Signs Senior Credit Facility

March 31, 2011 by · Leave a Comment 

Patrick Industries Inc. announced today (March 31) that it has entered into a credit agreement with Wells Fargo Capital Finance LLC as the lender and agent, establishing a four-year $50 million revolving secured senior credit facility.

Additional subordinated debt financing of $5 million was provided by Tontine Capital Overseas Master Fund II LP, a significant shareholder of Patrick, and Northcreek Mezzanine Fund I LP in the form of secured senior subordinated notes, according to a news release. As part of the consideration for the notes, the company issued warrants to purchase 125,000 shares of common stock to each of Tontine and Northcreek at an exercise price of $0.01 per share. The warrants are immediately exercisable and expire on March 31, 2016.

Patrick, an Elkhart, Ind.-based supplier to the RV and manufactured housing industries, used the proceeds of these financings to repay in full its existing senior credit facility at par. In addition, the company terminated and paid off its existing interest rate swap agreements. The swaps had a total fair value in the amount of $1.1 million on the termination date.

“We are excited to have entered into this new credit agreement which, based on our projections, provides the availability for Patrick to finance its ongoing working capital needs and general corporate purposes for the next four years,” said Todd Cleveland, president and CEO. “We are also very appreciative of the support that JPMorgan Chase and our other senior lenders have provided throughout the process of not only weathering the severe economic downturn, but in allowing us the time and opportunity to put a competitive facility in place to meet both our short-term and long-term needs. In addition, we look forward to our new partnership with Wells Fargo and Northcreek, as well as continuing our ongoing strong relationship with Tontine.”

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Patrick Industries Reporting Improved Results

March 1, 2011 by · Leave a Comment 

Patrick Industries Inc., a major manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets, today (March 1) reported its financial results for the fourth quarter and 12 months ended Dec. 31, 2010.

For the fourth quarter of 2010, Patrick reported an increase in net sales of approximately $4.7 million or 8.8%, to $58.1 million from $53.4 million in the 2009 period, primarily as a result of increased shipments in the RV industry and the impact of two acquisitions completed during the year, the company reported.

According to industry associations, wholesale unit shipments in the RV industry, which represented approximately 56% of the company’s sales in the quarter, increased 9% in the fourth quarter of 2010 compared to the prior year period. The MH industry, which represented approximately 29% of the company’s fourth quarter sales, experienced continued softness with unit shipments declining 16% from the fourth quarter of 2009. The company’s sales to the industrial market sector, which is tied to the residential housing market, were up slightly quarter over quarter, and accounted for approximately 15% of the Company’s fourth quarter 2010 sales.

The company reported a net loss of $900,000 or 10 cents per share in the fourth quarter of 2010 compared to net income of $900,000 or 9 cents per share in 2009. The fourth quarter 2010 net loss included a non-cash credit of approximately $100,000 or 1 cent per share related to mark-to-market accounting for common stock warrants. Fourth quarter 2009 net income included a net gain on the sale of fixed assets of approximately $1.2 million or 12 cents per share and a non-cash credit of approximately $500,000 or 5 cents per share related to stock warrant accounting.

“Although our sales increased approximately 9% in the fourth quarter over the prior year, our gross margin decreased to 9.7% from 10.8% in the 2009 quarter, reflecting increases in certain raw material prices and some production inefficiencies at one of our significant manufacturing operating units that we are in the process of resolving. Over the past several months, we have made a number of organizational changes and process and pricing improvements to enhance profitability at this facility,” said Todd Cleveland, president and CEO.

For the 12 months of 2010, net sales increased 30.9% to $278.2 million from $212.5 million in 2009. The RV industry, which represented approximately 58% of the company’s sales in 2010, saw wholesale unit shipments increase 46% when compared to the prior year. Shipments in the MH industry, which represented approximately 28% of sales in 2010, were up approximately 0.4% from 2009. The industrial market sector, which accounted for approximately 14% of the company’s full year 2010 sales, saw an increase in new housing starts of approximately 6% for the 12 months of 2010 when compared to the prior year.

Patrick reported net income of $1.2 million or 12 cents per share for the 2010 year reflecting an increase of $5.7 million or 61 cents per share, over the net loss of $4.5 million or 49 cents per share in 2009. Full year 2010 net income included a net gain on the sale of fixed assets of approximately $2.9 million or 29 cents per share which reflected the sale of the company’s Oregon and California facilities, and a non-cash credit of approximately $300,000 or 3 cents per share related to stock warrant accounting.

The full year 2009 net loss included the impact of a net gain on the sale of fixed assets of approximately $1.2 million or 13 cents per share, and the positive impact of income from discontinued operations of approximately $900,000 or 12 cents per share, which was partially offset by a non-cash charge of approximately $800,000 or 9 cents per share related to stock warrant accounting.

In 2010, the company paid down approximately $12.5 million in principal on its long-term debt. The net debt payments were funded by a combination of net proceeds from the sales of the California and Oregon facilities in the first quarter of 2010, and by utilizing cash on hand.

As previously announced, the company’s existing senior debt facility was extended to May 31, 2011, to allow sufficient time to put in place a new facility to meet both short-term and long-term operating needs. In addition, capital expenditures were $1.4 million for the full year 2010 compared to $300,000 in 2009. At Dec. 31, 2010, the company had a federal net operating loss carryforward of approximately $29.9 million that will begin to expire in 2027.

“Overall, we are pleased with the improved profitability in 2010 versus 2009 (excluding the gains on the sale of fixed assets in both periods) as our sales increased approximately 31% and we were able to keep our fixed costs stable over a larger sales base. Our growth during this past year was largely attributable to improved conditions in the RV market, capturing market share, and the impact of acquisitions. Our attention was also focused on improving all phases of our manufacturing and distribution processes where warranted, and controlling our manufacturing and overhead expenses in all of our operating units,”  Cleveland stated.

“As we move through 2011 with the expectation of continued improving market conditions primarily in the RV industry, we will remain focused on gaining market share, new product introductions and product line extensions, strategic acquisitions in our existing businesses and similar markets, and increasing brand recognition. In addition, we will look to continue to pay down debt, renew or replace our current credit facility, and develop our employee base. A focused ‘Customer First’ performance oriented culture remains at the forefront of our organizational strategic agenda in 2011 and beyond.”

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