LCI Industries (NYSE: LCII) reported Q2 EPS of $0.54, $0.70 better than the analyst estimate of ($0.16). Revenue for the quarter came in at $525.8 million versus the consensus estimate of $421.45 million.

Second Quarter 2020 Highlights

• Net sales of $525.8 million in the second quarter, a decrease of 16% year-over-year
• Aftermarket Segment sales grew to $158.0 million in the second quarter, an increase of 109% year-over-year
• International sales grew to $44.1 million in the second quarter, an increase of 40% year-over-year
• Adjacent Industries OEM sales declined to $130.6 million in the second quarter, a decrease of 23% year-over-year
• North American RV OEM net sales were less than 52% of total net sales for the twelve months ended June 30, 2020
• Content per travel trailer and fifth-wheel RV, adjusted to remove Furrion sales from prior periods, increased $141 year-over-year, or 4%, to $3,371 for the twelve months ended June 30, 2020
• Net income declined $34.3 million, or 72.3%, to $13.2 million, or $0.52 per diluted share, in the second quarter
• Adjusted net income, adjusted for a noncash charge for inventory fair value step-up and the related tax impact, declined $33.8 million, or 71.2%, to $13.7 million, or $0.54 per diluted share, in the second quarter
• Adjusted EBITDA decreased $38.7 million, or 45.9%, to $45.6 million in the second quarter
• Total debt decreased to $702.1 million at June 30, 2020 compared to $768.8 million at March 31, 2020, and cash decreased to $62.3 million at June 30, 2020 compared to $98.0 million at March 31, 2020
• Quarterly dividend of $0.65 per share paid totaling $16.3 million

“Our teams showed tremendous execution during the second quarter. Amidst a very difficult operating environment, we captured accelerated demand for RV and marine products, as well as strength in the aftermarket. In a span of less than two months, we were able to go from a near total shutdown in April to a record sales month in June. This could not have happened without the focus and speed to react by our leaders and team members. Despite top-line impact caused by production shutdowns in response to the COVID pandemic, we made substantial progress on driving operational efficiencies in an effort to mitigate any long-term impact to the business as a result of the pandemic, highlighting the effectiveness of the cost management initiatives we put into place at the beginning of the quarter,” commented Jason Lippert, LCI Industries’ President and Chief Executive Officer.

“We expect heightened RV demand to continue, signaling a paradigm shift for the industry as consumers are increasingly drawn into the RV lifestyle as a safe way to spend time with family in the outdoors. As a leader in innovation, LCI has a significant opportunity to further enhance its competitive position in the space,” Lippert continued. “Looking to the second half of 2020, we remain focused on executing on our diversification strategy, while at the same time, preparing to meet elevated RV demand. We stand committed to driving innovation across the business to further create value for our shareholders. In addition, I would like to thank our entire team, and in particular our operations and manufacturing groups, for juggling the demands of an extremely volatile operating environment. To deliver strong results amidst these challenges was an amazing accomplishment, and a testament to the capabilities of LCI’s robust leadership.”

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