Financial Data and Key Metrics Changes - The company reported a 7% increase in top line growth, resulting in revenue of approximately $1,000,000,000 for the first quarter [6][20] - Earnings per diluted share were $1.11, which included approximately $0.05 of dilution from convertible notes and related warrants [7][24] - Gross margin improved to 22.8%, up 90 basis points from the same period last year [21] - Net income increased by 9% to $38,000,000, while adjusted EPS decreased by 7% compared to the prior year [23][24] Business Line Data and Key Metrics Changes - RV revenues increased by 14% to $479,000,000, representing 48% of consolidated revenue [12] - Marine revenues were $149,000,000, up 4% from the prior year despite a 10% decrease in wholesale powerboat unit shipments [15] - Powersports revenues were $81,000,000, up 2% from the prior year [17] - Housing revenues increased by 7% to $295,000,000, with manufactured housing representing 59% of housing revenue [18] Market Data and Key Metrics Changes - RV wholesale unit shipments increased by 14%, while total RV retail unit shipments decreased approximately 7% [13] - Estimated marine retail and wholesale powerboat unit shipments were 766,500 units, implying a seasonal dealer field inventory build [16] - The company expects full-year RV retail unit shipments to be down mid to high single digits [30] Company Strategy and Development Direction - The company focuses on a diversified business strategy and model, emphasizing operational execution and innovation [5][8] - Recent acquisitions and stock repurchases are part of the capital allocation strategy to enhance growth opportunities [6][20] - The company aims to maintain flexibility and scalability in response to market dynamics, particularly in the face of tariff uncertainties [8][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term resilience of the outdoor enthusiast lifestyle despite current consumer uncertainty [9][10] - The company anticipates pent-up demand to drive new purchases once economic conditions stabilize [10] - Management acknowledged the impact of tariffs and is actively working to mitigate their effects through strategic sourcing and cost management [11][27] Other Important Information - The company completed two acquisitions in the quarter and repurchased approximately $8,500,000 of its stock [6][20] - Total net liquidity at the end of the first quarter was $745,000,000, with no major debt maturities until 2028 [26] Q&A Session Summary Question: What is the current exposure to tariffs? - Management indicated that approximately 15% of cost of goods sold is exposed to tariffs, with efforts underway to mitigate this exposure [27][38] Question: How are pricing strategies being adjusted in light of tariffs? - Management is being thoughtful about pricing increases and is working closely with customers to mitigate costs [40][41] Question: What is the outlook for RV shipments? - Management noted that while RV wholesale unit shipments increased in Q1, retail numbers showed some caution, indicating a need for consumer confidence to improve [55][56] Question: How is the company managing costs in the current environment? - The company is flexibly managing variable costs and has a playbook for potential cost reductions if necessary [63][64] Question: What is the outlook for manufactured housing? - Management remains optimistic about the manufactured housing market, citing a significant gap in affordable housing [91][100]
Patrick Industries(PATK) - 2025 Q1 - Earnings Call Transcript