Patrick Industries Inc. reported record earnings on double-digit growth in sales for its full year, ended Dec. 31, boosted by strong performance in the fourth quarter.
Elkhart, Ind.-based Patrick, a major manufacturer and distributor of building and component products for the recreational vehicle, manufactured housing and industrial markets, said sales for the fourth quarter increased $27.8 million, or 35.6%, to $106.1 million from $78.3 million in the same quarter of 2011.
The increase was primarily attributable to a 54% increase in the company’s revenue from the RV industry, which represented approximately 68% of its fourth quarter 2012 sales. Approximately $21.1 million of the revenue increase was attributable to the incremental impact of acquisitions completed in 2011 and 2012, including related market share growth.
Net income in the fourth quarter totaled $3.2 million, or 30 cents per diluted share, compared to net income of $1.5 million, or 14 cents per diluted share, in the fourth quarter of 2011.
“We are pleased by our fourth quarter revenue and profitability growth compared to 2011 as we continue to realize the benefits of our strategic and operational initiatives executed in 2011 and 2012,” said Todd Cleveland, President and CEO. “We believe the newest member of our Patrick family, Middlebury Hardwoods, and the other acquisitions we have completed in the last two years will continue to bring new and innovative products to our customers, provide positive contributions to our operating profitability, and allow us to gain additional penetration in the RV, MH, and industrial market sectors.”
Patrick acquired Middlebury, Ind.-based Middlebury Hardwood Products in October 2012. It was the company’s fourth acquisition of the year following the acquisition of Decor Mfg. in March 2012, Gustafson Lighting in July 2012, and Creative Wood Designs in September 2012.
For the 12 months, sales increased approximately $129.6 million, or 42.1%, to $437.4 million from $307.8 million in the same period in 2011. The sales increase reflected a 59% increase in the company’s revenue from the RV industry, which represented approximately 69% of its 2012 sales. Approximately $66.6 million of the revenue improvement was attributable to the incremental impact of business acquisitions completed in 2011 and 2012, including related market share growth.
For the full year, Patrick reported net income and diluted earnings per share of $28.1 million and $2.64, respectively – the highest in the company’s history – compared to net income of $8.5 million, or 83 cents per diluted share, in the same period in 2011.
Looking ahead, Cleveland stated, “As we begin a new year in 2013, we believe the investments we made in our businesses in 2011 and 2012 will positively impact both our top and bottom line results. In conjunction with the support of our new credit facility, our organizational strategic agenda, and the dedication and creativity of our more than 1,700 team members, we will continue to focus our efforts on the addition of new product lines and strategic acquisitions that will bring value to our customers in terms of innovation, price, flexibility and creativity both in the short-term and on a long-term basis.”
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Anchoring the general session during Stag Parkway Inc.’s Jan. 15-17 “Driving Success” dealer meeting, President and CEO Martin Street revealed details concerning the Atlanta-based company’s sale to a private equity firm last December while purporting the collective benefits for its dealer partners.
Addressing around 1,100 dealer personnel at the Henry B. Gonzalez Convention Center in San Antonio, Texas – representing a record turnout – Street highlighted the strengths of its new parent, Linsalata Capital. Stag also reported that 150 exhibitors were on hand for the meeting, displaying product on the expansive show floor.
“As I’m sure you have all seen, in December last year we were acquired by Linsalata Capital – a private equity company – from our previous owners Ares Capital,” said Street, who joined the distributor five years ago. “Lin-Cap, as it is known, is a company that specializes in owning logistics and distribution companies and so I am looking forward to the help that they can provide us, to continue with our growth plans, and to advise us on best practices that we will be able to incorporate into our current business model.”
Street acknowledged the takeover was a protracted and involved process, noting tongue-in-cheek, “At one time or another during last year I think we heard rumors that just about everyone in this room was buying us.”
He added, “Bottom line is Lin-Cap accepted that the RV industry was a great industry to be in because it has potential for growth. And they bought Stag because they believe that we can grow beyond where we currently are. They believed we are financially sound and have the infrastructure to grow. They believe, because we talked to them about our competition and they independently confirmed our views, that we are stronger than the competition and have better marketing plans for the future.”
Street also spoke to Stag’s recent expansion into the Canadian aftermarket with the opening of a warehouse facility in Brampton, Ontario, a suburb of Toronto.
“We have more than 7,000 items available there, two dedicated salespeople serving that market and plans to bring the entire portfolio of STAG services to Canada in the coming year,” he related. “…Expanding our market presence to the north is a natural extension of our growth plans. We very much look forward to working more closely with our customers there and believe our service levels, marketing and merchandising programs will be a welcome addition to the services they currently have access to.”
During the general session, Stag announced that long-time executive Craig Mellor would be stepping down from his responsibilities as senior vice president of sales to assume the role of senior sales advisor. Bob Barra, who previously served as regional sales manager and Eastern divisional vice president of sales, was introduced as Mellor’s successor.
“I’m delighted that we are able to promote from within to replace Craig and take someone who has developed and grown with Stag for many years and allow him the scope to help to continue to drive our business forward,” said Street.
As part of the gathering, Stag also recognized its key business partners with the traditional Peach Award. Recipients included Stromberg Carlson Products Inc., Winegard Co., RV Designer Collection, Progress Manufacturing Inc., SHURflo and Carmanah Industries.
Atlanta-based Stag Parkway Inc. kicked off its annual “Driving Success” dealer meeting Tuesday (Jan. 15) at the Henry B. Gonzalez Convention Center in San Antonio, Texas, with a full slate of instructional “RV University” sessions that are part of Stag’s ongoing Professional Retail Organization (PRO) dealer education program, now in its fourth year.
Those technical product training sessions were followed by a reception Tuesday night amid the exhibits on the show floor at an annual meeting drawing about 1,100 dealer personnel — similar to last year’s head count in Las Vegas — representing some 480 dealerships plus 150 exhibitors for a total of about 1,500 people, reports John Spaulding, vice president of marketing for Stag.
“With the PRO program, now in its fourth year, dealers can earn scholarships to attend the PRO seminars for free if they are certified,” Spaulding told RVBUSINESS.com. “And we had over half of our attendees in the RV University this year on scholarship. So, it’s a really good feeling to be able to say this program we kicked off for educating dealers four years ago is now bearing fruit and giving people the opportunity to come to the training center at our show for free.”
This is the seventh time that Stag, which was acquired in December by Cleveland-based Linsalata Capital Partners from Ares Capital Corp., has held its annual confab in the Texas City.
“It’s been a great location for us in the past,” said Spaulding. “The hotels and the convention center know us very well. Our dealers know the town very well, and we tend to drive a lot of traffic into this event because we get really good service and people really enjoy San Antonio for this kind of an event.”
Wednesday’s agenda called for an early general session in which President and CEO Martin Street as well as Spaulding and the Stag sales team were to present the company’s annual state-of-the-company comments. The day was to conclude in an evening party at historic Sunset Station, an old Amtrak station converted to a general meeting space at which two bands were scheduled to play.
Stag-Parkway has expanded its market coverage into Canada by opening warehouse operations in Brampton, Ontario. According to a news release, the warehouse location will give STAG the ability to provide next day service to southern Ontario and Western Quebec. The Canadian warehouse will initially stock more than 7,000 items and can accommodate the same inventory profile as the largest STAG facility in the U.S.
“The move to Canada was a logical one for us,” states Martin Street, president and CEO of Atlanta-based STAG. “We have been servicing RV dealers in Canada for several years from our northern warehouse locations in the U.S. While we have been competitive doing so, we see an even bigger opportunity in Canada by being physically located there. We look forward to working with Canadian RV dealers and see this launch as a way to reinforce our commitment to serving them in the future.”
To support the sales effort in Canada, STAG has hired two salespeople. “Servicing the market effectively means having feet on the street,” commented Craig Mellor, senior vice president of sales. “We knew going in that we would need professional sales people from Canada spearheading our sales effort. We feel very fortunate to have found Christian Fauteux and Gordon Edgar to fill that role. They both have sales tenure in other markets which complements our approach to bringing a broader perspective of retailing to our customers.”
Fauteux and Edgar have completed their initial round of product and industry training with an extensive in-the-field program conducted by STAG’s U.S. sales team. According to Mellor, “Their experiences in Canada and working with retailers throughout the region will provide valuable insight and direction to ensure we treat the Canadian market and its dealers as unique with unique needs.”
Other plans for Canada include the introduction of a Canadian version of the BIG Book in 2013 as well as making available a variety of marketing and merchandising programs to Canadian dealers. “We want to be a full-service distributor in Canada,” says John Spaulding, senior vice president of marketing. “That includes making available our Complete Merchandising program, our direct mail and custom imprint programs as well as our B2B and B2C offerings. All of which will be rolled out over the next 12-18 months.”
Canadian dealers interested in learning more about STAG can call (800) 765-7824.
The Coast Distribution System Inc., an aftermarket suppliers of replacement parts, accessories and supplies for the recreational vehicle and outdoor recreation industries, reported a drop in earnings for its second quarter and six months ended June 30, impacted by lower margins.
Morgan Hills, Calif.-based Coast reported net income of $0.5 million, or $0.11 per diluted share, for the second quarter, compared to net income of $1.0 million, or $0.21 per diluted share, in the same quarter of 2011. For the six months, Coast recorded a net loss of $800,000, or ($0.18) per diluted share, compared with a net loss of $59,000, or ($0.01) per diluted share, for the year prior.
The company said the decline in net income in this year’s second quarter and the increase in the net loss for the first six months were primarily attributable to declines in gross profits, which more than offset modest increases in net sales, in each of those periods.
Net sales for the second quarter increased by 2.7% to $34.1 million compared to net sales of $33.2 million in the second quarter of 2011. In the six months, net sales increased by 0.8% to $58.4 million from $57.9 million in the same six-month period of 2011.
Those increases were primarily the result of increased sales of the company’s Powerhouse generators to large retailers outside the RV and boating channels, which more than offset the effects on sales of RV and boating products of continued consumer uncertainty regarding the economic recovery.
Gross profits fell by $0.7 million to $5.6 million, resulting in a decrease in gross margin to 16.4% in the second quarter compared with 19% in the same quarter of 2011. In the six months ended, gross profits fell by $1.2 million, to $9.0 million, resulting in a decline in gross margin to 15.5% from 17.6% in the same six months of 2011.
These decreases were the result of price reductions on selected products that Coast implemented in response to aggressive price competition in the market, as well as a weakening of the Canadian dollar, as compared to the U.S. dollar, which increased costs for the company’s Canadian subsidiary of purchasing products from U.S. suppliers. Coast expects that the price increases it began implementing in July 2012 will contribute to improvement in gross margins in the second half of 2012.
“Although we posted modest top-line growth for the second quarter, ongoing consumer uncertainty about economic recovery and high unemployment continued to unfavorably affect our results,” said Coast’s CEO Jim Musbach. “Despite these challenges, we see reasons for optimism as we pursue our long-term strategic plan. We have made solid progress in 2012 in our sales of generators to large mass merchandisers, a new distribution channel for us. In addition, our sales to our traditional RV customers are slowly showing signs of recovery, which resulted in solid sales gains in July. As we enter the second half of the year, we continue to be optimistic about sales growth, given positive order momentum in our proprietary products where we plan to tap into existing distribution channels in addition to exploring new opportunities.”
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Attendance at NTP Distribution Inc.’s 2012 National Dealer Conference was the largest the industry distributor has seen in its 30-plus years of shows, more than doubling in size from just two years ago, according to a press release.
The show, which marked the Wilsonville, Ore.-based company’s 50th year of operation, ran February 21-23 at the San Diego Convention Center.
Greg Boyd, president of NTP, attributed the dramatic attendance increase to several factors beyond the excitement over the company’s milestone and its recent acquisition by Keystone Automotive Operations Inc.
“A lot of factors outside of it being our 50th have combined to make this an incredibly successful event,” he said. “Of course, everyone’s excited about our recent partnership with Keystone, but there’s a lot of interest in the new product lines we’re offering. I also think we’re starting to see dealer confidence rise as the economy starts to level out.”
The three-day event began with a full day of vendor workshops and product training seminars along with a cocktail reception to preview the show floor. The next day the company celebrated their 50th anniversary with dinner and entertainment on-board the USS Midway. The final day of show activity included lunch with an address by Boyd.
NTP launched several new initiatives including Home & Road, the company’s first private label mattress offering, a truck accessories program designed to help RV dealers expand their product mix, and several new marketing initiatives, including an exclusive on-demand marketing portal.
Ed Orzetti, CEO of Keystone Automotive Operations, called the conference a huge success, echoing the feedback from both vendors and dealers alike.
“This has been my first opportunity to attend an NTP show,” Orzetti said. “Not only was the venue phenomenal, the energy in the room was contagious. NTP puts on a first-rate conference.”
NTP will return to San Diego for their 2013 show. For more information about NTP Distribution, visit www.ntpdistribution.com.
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.
Industry distributor NTP Distribution Inc. will be celebrating 50 years in business as the company opens its 2012 National Dealer Conference today (Feb. 20) in San Diego.
The event, which runs through Friday, will offer dealers the chance to review NTP’s wide range of RV aftermarket parts and accessories. The conference will also mark the Wilsonville, Ore.-based firm’s first dealer gathering since being acquired by Keystone Automotive Operations Inc. last October.
Several events are scheduled, including a series of vendor workshops, while motivational speaker Garrison Wynn will deliver the keynote address. Highlighting the convention will be an excursion to the USS Midway on Wednesday. Attendees will receive a guided tour of the legendary decommissioned carrier, which is docked at San Diego’s Navy Pier.
NTP is a national supplier of aftermarket products, parts and accessories for dealers in the RV and hitch and tow industries. The company has 200 employees and five distribution centers across the U.S.
Distributor Stag-Parkway Inc. will be hosting its 2012 “Driving Success” Trade Show Jan. 16-18 at The Mirage in Las Vegas, boasting more than 100,000 square feet of exhibitor displays along with three days of networking opportunities and special events.
According to the Atlanta-based firm, the event will focus on delivering a “complete trade show experience” ranging from education to products to marketing and merchandising. Highlights include:
• Hundreds of New Products
• Model Store to inspire merchandising ideas
• Updated Web Tools
• Customer Acquisition and Retention Tools
The show will also feature RV University, which Stag-Parkway said “builds on the four pillars of a successful retail business.” The curriculum draws heavily on successful training programs used at chain and mass merchant retailers around the country and was developed exclusively for Stag-Parkway’s dealers.
Product seminars presented by key suppliers will focus on the features and benefits of new products, and give RV dealers tips and tools on closing the sale. Dealers will also learn how to merchandise new items from the pros.
Monday will feature a suppliers meeting at 4 p.m. and an opening reception at 6 p.m. The general session is scheduled for Tuesday at 8 a.m. Exhibits will be open 9 a.m. to 5 p.m. Tuesday and 8 a.m. to 5 p.m. Wednesday.
Officially opening Sunday evening with an informal reception, Eagan, Minn.-based distributor Bell Industries Recreational Products Group (RPG) is holding its annual RV and marine buying show Jan. 9-10 offering dealers a chance to shop its portfolio of aftermarket parts and accessories.
“The reception is a chance for our dealers and vendors to meet in a relaxed setting, giving people the chance to mingle and also for dealers to get a quick preview of what’s available,” offered Ross Carlson, vice president of marketing and product line management for Bell Industries RPG, a subsidiary of Bell Industries Inc.
Held for the seventh straight year at the Kalahari Resort in Wisconsin Dells, Wis., Carlson reported that around 625 people representing 150 dealerships are attending this year’s event. He noted that Bell’s primary territory is the upper Midwest with distribution centers in Eagan, Milwaukee and Grand Rapids, Mich.
“We have found that the Kalahari Resort provides a great place for people to bring their families,” Carlson said. “There are a lot of activities in the indoor theme park and we also have a casino night that has become pretty popular.”
The main attraction, however, is the array of product display booths. Carlson said that the cross section of select vendors are showing and demonstrating over 140 lines, including 17 companies attending the event for the first time.
“The RV industry is the biggest part of our business,” he said, “but we also offer a nice selection of products for the marine and powersports dealers. Obviously, there are also a lot of products that cross over between the industries.”
He added, “One of the draws is that in addition to showing product, vendors are offering programs representing the best pricing that dealers will see this year. We can start shipping in January, but we also offer extended date terms, meaning that for a qualified order we can hold off shipping until April, May or June when they actually start selling the products.”
Carlson said that Bell was coming off a “pretty strong 2011” and is looking for more growth in 2012, adding that the January buying show annually provides a boost for the rest of the year.
“It has proven to be a really good event,” he said. “Dealers leave with good knowledge of the product for coming year. It also gives us the opportunity to show that we appreciate their business. We are intent on making the show a good time as well as productive.”