LCI Industries Reports Fourth Quarter Results

February 9, 2021 7:00 AM EST

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Record sales and earnings driven by RV demand and diversification strategy

Fourth Quarter 2020 Highlights

  • Net sales of $783.0 million in the fourth quarter, an increase of 39% year-over-year
  • Net income increased $19.9 million, or 69%, to $48.7 million, or $1.92 per diluted share, in the fourth quarter
  • Adjusted EBITDA increased $30.9 million, or 54%, to $88.1 million in the fourth quarter
  • North American RV OEM sales grew to $402.9 million in the fourth quarter, up 25% year-over-year
  • Adjacent Industries OEM sales grew to $189.9 million in the fourth quarter, up 20% year-over-year
  • Aftermarket Segment sales grew to $157.3 million in the fourth quarter, up 129% year-over-year
  • Completed the acquisitions of Veada Industries and Challenger Door, each with $80 million of annual sales
  • Quarterly dividend of $0.75 per share paid totaling $18.9 million

Full Year 2020 Highlights

  • Net sales of $2.8 billion, an increase of 18% year-over-year
  • Net income increased $11.9 million, or 8%, to $158.4 million, or $6.27 per diluted share
  • Adjusted EBITDA increased $52.6 million, or 19%, to $328.2 million
  • Execution of diversification strategy continued as net sales outside of North American RV OEM net sales grew to 50.3% of total net sales for the year ended December 31, 2020, compared to 42.0% in the prior year
  • Completed three strategic acquisitions for combined purchase price of $182.1 million
  • Returned $70.4 million to shareholders through payment of dividends

ELKHART, Ind.--(BUSINESS WIRE)-- LCI Industries (NYSE: LCII) which, through its wholly-owned subsidiary, Lippert Components, Inc. ("LCI"), supplies a broad array of highly engineered components for the leading original equipment manufacturers ("OEMs") in the recreation and transportation product markets, and the related aftermarkets of those industries, today reported fourth quarter and full year 2020 results.

“2020 proved to be a historic year for LCI Industries in many respects, starting with our response to the COVID-19 pandemic and related shutdowns, and culminating with record annual net sales of $2.8 billion. This could not have been possible without the tremendous efforts of our team. They successfully navigated an unprecedented economic environment to capture incredible industry demand, while also working to mitigate supply chain and labor constraints that have impacted the wider RV and marine space. Our team marched right into the storm, led by an experienced leadership team, which has proven time and again that they can pivot quickly – even in times of global crisis – to position LCI Industries to emerge stronger and ready for growth. This outperformance is a testament to the strong, cohesive culture which we continue to foster throughout our Company, and I am thankful for each and every one of our teammates across the globe,” commented Jason Lippert, LCI Industries’ President and Chief Executive Officer.

“Furthermore, our focus on operational excellence and commitment to innovation enabled strong organic growth during the year, and importantly, we continued to execute on our diversification strategy, expanding further into the marine and adjacent industries through the acquisitions of Challenger Door and Veada Industries to further establish LCI Industries as an industry leader,” continued Lippert. “We believe that retail tailwinds, which supported our growth in 2020, will remain elevated well into 2021 and beyond. Strong demand for recreational products continues, bolstered by expanded accessibility from popular services like peer-to-peer rentals and remote work and school, along with the significant reduction in air travel, all of which draw more consumers into the outdoor lifestyle. I would like to again thank all of our team for their hard work as we look to maintain this momentum, accelerate growth and deliver value to our customers, shareholders, team members, and communities in the new year.”

Fourth Quarter 2020 Results

Consolidated net sales for the fourth quarter of 2020 were $783.0 million, an increase of 39 percent from 2019 fourth quarter net sales of $564.0 million. Net income in the fourth quarter of 2020 was $48.7 million, or $1.92 per diluted share, compared to net income of $28.8 million, or $1.14 per diluted share, in the fourth quarter of 2019. Adjusted EBITDA in the fourth quarter of 2020 was $88.1 million, compared to adjusted EBITDA of $57.1 million in the fourth quarter of 2019. Additional information regarding adjusted EBITDA, as well as a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure, are provided in the "Supplementary Information - Reconciliation of Non-GAAP Measures" section below.

The increase in year-over-year net sales for the fourth quarter of 2020 was primarily driven by record RV retail demand, in addition to the impact of acquisitions and organic growth across the Company's aftermarket segment and international markets. Net sales from acquisitions completed in 2019 and 2020 contributed approximately $73 million in the fourth quarter of 2020.

The Company's average product content per travel trailer and fifth-wheel RV, adjusted to remove Furrion sales from prior periods, for the twelve months ended December 31, 2020, increased $44 to $3,390, compared to $3,346 for the twelve months ended December 31, 2019. The content increase in towables was a result of organic growth, including new product introductions.

Full Year 2020 Results

Consolidated net sales for the full year 2020 were $2.8 billion, an increase of 18 percent from full year 2019 net sales of $2.4 billion. Net income for the full year 2020 was $158.4 million, or $6.27 per diluted share, compared to net income of $146.5 million, or $5.84 per diluted share, for the full year 2019. Adjusted net income for the year ended December 31, 2020 was $164.0 million, or $6.49 per diluted share. Adjusted EBITDA for the year ended December 31, 2020 was $328.2 million, compared to adjusted EBITDA of $275.6 million for the year ended December 31, 2019. Additional information regarding adjusted net income, adjusted diluted net income per common share, and adjusted EBITDA, as well as reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures, are provided in the "Supplementary Information - Reconciliation of Non-GAAP Measures" section below.

The increase in year-over-year net sales for the full year 2020 was primarily driven by the impact of acquisitions, organic growth in the Company's aftermarket segment, and record RV retail demand following COVID-19 shutdowns in the first half of the year. Net sales from acquisitions completed in 2019 and 2020 contributed approximately $375 million in 2020.

January 2021 Results

January 2021 consolidated net sales were approximately $309 million, up 38 percent from January 2020, as the significant increase in RV production continued into the new year to meet elevated RV retail demand. While the supply chain continues to have challenges, major issues were addressed through the course of 2020 and we are encouraged by the fact that we saw OEMs reduce downtime due to supply chain related issues in January.

Income Taxes

The Company's effective tax rate was 24.4 percent and 20.0 percent for the year and quarter ended December 31, 2020, respectively, compared to 23.5 percent and 18.5 percent for the year and quarter ended December 31, 2019, respectively. The effective tax rate was favorably impacted during the fourth quarter of 2020 due to discrete adjustments, which resulted in an increase to diluted earnings per share of $0.15.

Balance Sheet and Other Items

At December 31, 2020, the Company's cash and cash equivalents balance was $51.8 million, up from $35.4 million at December 31, 2019. The Company generated net cash flows from operations of $231.4 million and used $182.1 million for acquisitions, $70.4 million for dividend payments to shareholders, and $57.3 million for capital expenditures in the twelve months ended December 31, 2020. The Company's outstanding long-term indebtedness, including current maturities, was $738.2 million at December 31, 2020, and the Company remained in compliance with its debt covenants. The Company believes that its current liquidity is adequate to meet operating needs for the foreseeable future.

Conference Call & Webcast

LCI will host a conference call to discuss its fourth quarter results on Tuesday, February 9, 2021, at 8:30 a.m. Eastern time, which may be accessed by dialing (877) 668-4883 for participants in the U.S./Canada or (825) 312-2360 for participants outside the U.S./Canada using the required conference ID 5185385. Due to the high volume of companies reporting earnings at this time, please be prepared for hold times of up to 15 minutes when dialing in to the call. In addition, an online, real-time webcast, as well as a supplemental earnings presentation, can be accessed on the Company's website, www.investors.lci1.com.

A replay of the conference call will be available for two weeks by dialing (800) 585-8367 for participants in the U.S./Canada or (416) 621-4642 for participants outside the U.S./Canada and referencing access code 5185385. A replay of the webcast will be available on the Company's website immediately following the conclusion of the call.

About LCI Industries

LCI Industries, through its wholly-owned subsidiary, LCI, supplies, domestically and internationally, a broad array of highly engineered components for the leading OEMs in the recreation and transportation product markets, consisting primarily of recreational vehicles and adjacent industries, including buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; boats; trains; manufactured homes; and modular housing. The Company also supplies engineered components to the related aftermarkets of these industries, primarily by selling to retail dealers, wholesale distributors, and service centers. LCI's products include steel chassis and related components; axles and suspension solutions; slide-out mechanisms and solutions; thermoformed bath, kitchen, and other products; vinyl, aluminum, and frameless windows; manual, electric, and hydraulic stabilizer and leveling systems; entry, luggage, patio, and ramp doors; furniture and mattresses; electric and manual entry steps; awnings and awning accessories; towing products; truck accessories; electronic components; and other accessories. Additional information about LCI and its products can be found at www.lci1.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" with respect to our financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive position, growth opportunities, acquisitions, plans and objectives of management, markets for the Company's common stock, the impact of legal proceedings, and other matters. Statements in this press release that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, and involve a number of risks and uncertainties.

Forward-looking statements, including, without limitation, those relating to our future business prospects, net sales, expenses and income (loss), capital expenditures, tax rate, cash flow, financial condition, liquidity, retail and wholesale demand, integration of acquisitions, R&D investments, and industry trends, whenever they occur in this press release are necessarily estimates reflecting the best judgment of the Company's senior management at the time such statements were made. There are a number of factors, many of which are beyond the Company's control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors include, in addition to other matters described in this press release, the impacts of COVID-19, or other future pandemics, on the global economy and on the Company's customers, suppliers, employees, business and cash flows, pricing pressures due to domestic and foreign competition, costs and availability of, and tariffs on, raw materials (particularly steel and aluminum) and other components, seasonality and cyclicality in the industries to which we sell our products, availability of credit for financing the retail and wholesale purchase of products for which we sell our components, inventory levels of retail dealers and manufacturers, availability of transportation for products for which we sell our components, the financial condition of our customers, the financial condition of retail dealers of products for which we sell our components, retention and concentration of significant customers, the costs, pace of and successful integration of acquisitions and other growth initiatives, availability and costs of production facilities and labor, team member benefits, team member retention, realization and impact of expansion plans, efficiency improvements and cost reductions, the disruption of business resulting from natural disasters or other unforeseen events, the successful entry into new markets, the costs of compliance with environmental laws, laws of foreign jurisdictions in which we operate, other operational and financial risks related to conducting business internationally, and increased governmental regulation and oversight, information technology performance and security, the ability to protect intellectual property, warranty and product liability claims or product recalls, interest rates, oil and gasoline prices and availability, the impact of international, national and regional economic conditions and consumer confidence on the retail sale of products for which we sell our components, and other risks and uncertainties discussed more fully under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2019, and in the Company's subsequent filings with the Securities and Exchange Commission. Readers of this press release are cautioned not to place undue reliance on these forward-looking statements, since there can be no assurance that these forward-looking statements will prove to be accurate. The Company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.

LCI INDUSTRIES

OPERATING RESULTS

(unaudited)

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

2020

 

2019

 

2020

 

2019

(In thousands, except per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

783,002

 

 

$

564,021

 

 

$

2,796,166

 

 

$

2,371,482

 

Cost of sales

 

585,698

 

 

441,539

 

 

2,090,076

 

 

1,832,280

 

Gross profit

 

197,304

 

 

122,482

 

 

706,090

 

 

539,202

 

Selling, general and administrative expenses

 

133,851

 

 

84,837

 

 

483,156

 

 

338,992

 

Operating profit

 

63,453

 

 

37,645

 

 

222,934

 

 

200,210

 

Interest expense, net

 

2,610

 

 

2,290

 

 

13,453

 

 

8,796

 

Income before income taxes

 

60,843

 

 

35,355

 

 

209,481

 

 

191,414

 

Provision for income taxes

 

12,150

 

 

6,548

 

 

51,041

 

 

44,905

 

Net income

 

$

48,693

 

 

$

28,807

 

 

$

158,440

 

 

$

146,509

 

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

Basic

 

$

1.93

 

 

$

1.15

 

 

$

6.30

 

 

$

5.86

 

Diluted

 

$

1.92

 

 

$

1.14

 

 

$

6.27

 

 

$

5.84

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

25,166

 

 

25,042

 

 

25,134

 

 

24,998

 

Diluted

 

25,363

 

 

25,213

 

 

25,255

 

 

25,093

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

$

24,614

 

 

$

19,476

 

 

$

97,980

 

 

$

75,358

 

Capital expenditures

 

$

28,683

 

 

$

10,435

 

 

$

57,346

 

 

$

58,202

 

 

LCI INDUSTRIES

SEGMENT RESULTS

(unaudited)

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

2020

 

2019

 

2020

 

2019

(In thousands)

 

 

 

 

 

 

 

 

Net sales:

 

 

 

 

 

 

 

 

OEM Segment:

 

 

 

 

 

 

 

 

RV OEMs:

 

 

 

 

 

 

 

 

Travel trailers and fifth-wheels

 

$

384,891

 

 

$

302,740

 

 

$

1,321,567

 

 

$

1,276,718

 

Motorhomes

 

50,855

 

 

34,456

 

 

158,096

 

 

155,623

 

Adjacent Industries OEMs

 

189,942

 

 

158,007

 

 

688,248

 

 

659,560

 

Total OEM Segment net sales

 

625,688

 

 

495,203

 

 

2,167,911

 

 

2,091,901

 

Aftermarket Segment:

 

 

 

 

 

 

 

 

Total Aftermarket Segment net sales

 

157,314

 

 

68,818

 

 

628,255

 

 

279,581

 

Total net sales

 

$

783,002

 

 

$

564,021

 

 

$

2,796,166

 

 

$

2,371,482

 

 

 

 

 

 

 

 

 

 

Operating profit:

 

 

 

 

 

 

 

 

OEM Segment

 

$

45,607

 

 

$

33,856

 

 

$

156,092

 

 

$

165,290

 

Aftermarket Segment (1)

 

17,846

 

 

3,789

 

 

66,842

 

 

34,920

 

Total operating profit

 

$

63,453

 

 

$

37,645

 

 

$

222,934

 

 

$

200,210

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization:

 

 

 

 

 

 

 

 

OEM Segment depreciation

 

$

12,303

 

 

$

11,601

 

 

$

47,763

 

 

$

46,020

 

Aftermarket Segment depreciation

 

2,902

 

 

1,673

 

 

12,344

 

 

5,580

 

Total depreciation

 

$

15,205

 

 

$

13,274

 

 

$

60,107

 

 

$

51,600

 

 

 

 

 

 

 

 

 

 

OEM Segment amortization

 

$

6,654

 

 

$

5,164

 

 

$

26,325

 

 

$

20,787

 

Aftermarket Segment amortization

 

2,755

 

 

1,038

 

 

11,548

 

 

2,971

 

Total amortization

 

$

9,409

 

 

$

6,202

 

 

$

37,873

 

 

$

23,758

 

 

(1) Full year 2020 results include a non-cash charge for inventory fair value step-up of $7.3 million incurred in the first nine months of 2020 related to CURT purchase accounting.

 

LCI INDUSTRIES

BALANCE SHEET INFORMATION

(unaudited)

 

 

 

December 31,

 

December 31,

 

 

2020

 

2019

(In thousands)

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

Current assets

 

 

 

 

Cash and cash equivalents

 

$

51,821

 

 

$

35,359

 

Accounts receivable, net of allowances of $5,642 and $3,144 at December 31, 2020 and 2019, respectively

 

268,625

 

 

199,976

 

Inventories, net

 

493,899

 

 

393,607

 

Prepaid expenses and other current assets

 

55,456

 

 

41,849

 

Total current assets

 

869,801

 

 

670,791

 

Fixed assets, net

 

387,218

 

 

366,309

 

Goodwill

 

454,728

 

 

351,114

 

Other intangible assets, net

 

420,885

 

 

341,426

 

Operating lease right-of-use assets

 

104,179

 

 

98,774

 

Other assets

 

61,220

 

 

34,181

 

Total assets

 

$

2,298,031

 

 

$

1,862,595

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

Current liabilities

 

 

 

 

Current maturities of long-term indebtedness

 

$

17,831

 

 

$

17,883

 

Accounts payable, trade

 

184,931

 

 

99,262

 

Current portion of operating lease obligations

 

25,432

 

 

21,693

 

Accrued expenses and other current liabilities

 

188,200

 

 

132,420

 

Total current liabilities

 

416,394

 

 

271,258

 

Long-term indebtedness

 

720,418

 

 

612,906

 

Operating lease obligations

 

82,707

 

 

79,848

 

Deferred taxes

 

53,833

 

 

35,740

 

Other long-term liabilities

 

116,353

 

 

62,171

 

Total liabilities

 

1,389,705

 

 

1,061,923

 

Total stockholders’ equity

 

908,326

 

 

800,672

 

Total liabilities and stockholders’ equity

 

$

2,298,031

 

 

$

1,862,595

 

 

 

 

Twelve Months Ended
December 31,

 

 

2020

 

2019

(In thousands)

 

 

 

 

Cash flows from operating activities:

 

 

 

 

Net income

 

$

158,440

 

 

$

146,509

 

Adjustments to reconcile net income to cash flows provided by operating activities:

 

 

 

 

Depreciation and amortization

 

 

97,980

 

 

 

75,358

 

Stock-based compensation expense

 

 

18,502

 

 

 

16,077

 

Deferred taxes

 

 

(1,504

)

 

 

3,416

 

Other non-cash items

 

 

2,229

 

 

 

(1,553

)

Changes in assets and liabilities, net of acquisitions of businesses:

 

 

 

 

Accounts receivable, net

 

 

(45,028

)

 

 

(25,452

)

Inventories, net

 

 

(86,898

)

 

 

57,790

 

Prepaid expenses and other assets

 

 

(29,158

)

 

 

6,882

 

Accounts payable, trade

 

 

67,679

 

 

 

(12,189

)

Accrued expenses and other liabilities

 

 

49,158

 

 

 

2,687

 

Net cash flows provided by operating activities

 

 

231,400

 

 

 

269,525

 

Cash flows from investing activities:

 

 

 

 

Capital expenditures

 

 

(57,346

)

 

 

(58,202

)

Acquisitions of businesses, net of cash acquired

 

 

(182,130

)

 

 

(447,764

)

Other investing activities

 

 

7,175

 

 

 

2,132

 

Net cash flows used in investing activities

 

 

(232,301

)

 

 

(503,834

)

Cash flows from financing activities:

 

 

 

 

Vesting of stock-based awards, net of shares tendered for payment of taxes

 

 

(4,853

)

 

 

(8,084

)

Proceeds from revolving credit facility

 

 

543,991

 

 

 

655,387

 

Repayments under revolving credit facility

 

 

(430,390

)

 

 

(628,891

)

Proceeds from term loan borrowings

 

 

 

 

 

300,000

 

Repayments under term loan and other borrowings

 

 

(22,444

)

 

 

 

Payment of dividends

 

 

(70,401

)

 

 

(63,813

)

Payment of contingent consideration related to acquisitions

 

 

(1,633

)

 

 

(10

)

Other financing activities

 

 

(222

)

 

 

382

 

Net cash flows provided by financing activities

 

 

14,048

 

 

 

254,971

 

Effect of exchange rate changes on cash and cash equivalents

 

 

3,315

 

 

 

(231

)

Net increase in cash and cash equivalents

 

 

16,462

 

 

 

20,431

 

Cash and cash equivalents at beginning of period

 

 

35,359

 

 

 

14,928

 

Cash and cash equivalents cash at end of period

 

$

51,821

 

 

$

35,359

 

 

LCI INDUSTRIES

SUPPLEMENTARY INFORMATION

(unaudited)

 

 

 

Three Months Ended

 

Twelve Months Ended

 

 

December 31,

 

December 31,

 

 

2020

 

2019

 

2020

 

2019

Industry Data(1) (in thousands of units):

 

 

 

 

 

 

 

 

Industry Wholesale Production:

 

 

 

 

 

 

 

 

Travel trailer and fifth-wheel RVs

 

115.2

 

 

83.3

 

 

380.0

 

 

349.7

 

Motorhome RVs

 

12.4

 

 

10.3

 

 

40.7

 

 

46.6

 

Industry Retail Sales:

 

 

 

 

 

 

 

 

Travel trailer and fifth-wheel RVs

 

82.8

 

(2)

63.6

 

 

445.3

 

(2)

397.8

 

Impact on dealer inventories

 

32.4

 

(2)

19.7

 

 

(65.3

(2)

(48.1

Motorhome RVs

 

8.6

 

(2)

8.4

 

 

43.3

 

(2)

46.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2020

 

2019

LCI Content Per Industry Unit Produced: (3)

 

 

 

 

Travel trailer and fifth-wheel RV

 

 

 

 

 

$

3,390

 

 

$

3,346

 

Motorhome RV

 

 

 

 

 

$

2,479

 

 

$

2,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2020

 

2019

Balance Sheet Data (debt availability in millions):

 

 

 

 

Remaining availability under the debt facilities (4)

 

$

352.2

 

 

$

481.8

 

Days sales in accounts receivable, based on last twelve months

 

31.6

 

 

25.7

 

Inventory turns, based on last twelve months

 

5.7

 

 

5.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

Estimated Full Year Data:

 

 

 

 

 

 

 

 

Capital expenditures

 

 

 

 

 

$ 130 - $ 150 million

Depreciation and amortization

 

 

 

 

 

$ 110 - $ 120 million

Stock-based compensation expense

 

 

 

 

 

$ 20 - $ 30 million

Annual tax rate

 

 

 

 

 

24% - 26%

 

 

 

 

 

 

 

 

 

(1) Industry wholesale production data for travel trailer and fifth-wheel RVs and motorhome RVs provided by the Recreation Vehicle Industry Association. Industry retail sales data provided by Statistical Surveys, Inc.

(2) December 2020 retail sales data for RVs has not been published yet, therefore 2020 retail data for RVs includes an estimate for December 2020 retail units. Retail sales data will likely be revised upwards in future months as various states report.

(3) The content figures presented were adjusted to remove Furrion sales from prior periods, as the Furrion distribution and supply agreement was terminated effective December 31, 2019.

(4) Remaining availability under the debt facilities is subject to covenant restrictions and, in the case of $150 million of such availability, the lender's discretion.

 

LCI INDUSTRIES

SUPPLEMENTARY INFORMATION

RECONCILIATION OF NON-GAAP MEASURES

(unaudited)

 

The following table reconciles net income to adjusted net income and diluted net income per common share to adjusted diluted net income per common share.

   

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

2020

 

2019

 

2020

 

2019

(In thousands, except per share amounts)

 

 

 

 

 

 

 

 

Net income

 

$

48,693

 

$

28,807

 

$

158,440

 

 

$

146,509

Non-cash charge for inventory fair value step-up

 

 

 

 

 

 

7,286

 

 

 

Income tax impact of inventory fair value step-up

 

 

 

 

 

 

(1,772

)

 

 

Adjusted net income

 

$

48,693

 

$

28,807

 

$

163,954

 

 

$

146,509

 

 

 

 

 

 

 

 

 

Diluted net income per common share

 

$

1.92

 

$

1.14

 

$

6.27

 

 

$

5.84

Non-cash charge for inventory fair value step-up

 

 

 

 

 

 

0.29

 

 

 

Income tax impact of inventory fair value step-up

 

 

 

 

 

 

(0.07

)

 

 

Adjusted diluted net income per common share

 

$

1.92

 

$

1.14

 

$

6.49

 

 

$

5.84

 

 

 

 

 

 

 

 

 

 

The following table reconciles net income to EBITDA and Adjusted EBITDA.

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

2020

 

2019

 

2020

 

2019

(In thousands)

 

 

 

 

 

 

 

 

Net income

 

$

48,693

 

 

$

28,807

 

 

$

158,440

 

 

$

146,509

 

Interest expense, net

 

2,610

 

 

2,290

 

 

13,453

 

 

8,796

 

Provision for income taxes

 

12,150

 

 

6,548

 

 

51,041

 

 

44,905

 

Depreciation expense

 

15,205

 

 

13,274

 

 

60,107

 

 

51,600

 

Amortization expense

 

9,409

 

 

6,202

 

 

37,873

 

 

23,758

 

EBITDA

 

88,067

 

 

57,121

 

 

320,914

 

 

275,568

 

Non-cash charge for inventory fair value step-up

 

 

 

 

 

7,286

 

 

 

Adjusted EBITDA

 

$

88,067

 

 

$

57,121

 

 

$

328,200

 

 

$

275,568

 

In addition to reporting financial results in accordance with U.S. GAAP, the Company has provided the non-GAAP performance measures of adjusted net income, adjusted diluted net income per common share, and adjusted EBITDA to illustrate and improve comparability of its results from period to period. Adjusted net income is defined as net income adjusted for items that impact the comparability of the Company's results from period to period, which consisted of the inventory fair value step-up from the acquisition of CURT and related tax impacts during the twelve month period ended December 31, 2020. Adjusted diluted net income per common share is defined as net income per common share adjusted for items that impact the comparability of the Company's results from period to period, which consisted of the inventory fair value step-up from the acquisition of CURT and related tax impacts during the twelve month period ended December 31, 2020. Adjusted EBITDA is defined as net income before interest expense, net, provision for income taxes, depreciation and amortization expense, and other adjustments made in order to present comparable results from period to period, which consisted of the inventory fair value step-up from the acquisition of CURT during the twelve month period ended December 31, 2020. The Company considers these non-GAAP measures in evaluating and managing the Company's operations and believes that discussion of results adjusted for these items is meaningful to investors because it provides a useful analysis of ongoing underlying operating trends. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures, and they may not be comparable to similarly titled measures used by other companies.

Brian Hall, CFO
Phone: (574) 535-1125
E Mail: LCII@lci1.com

 

Source: LCI Industries



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