LCII - LCI Industries (LCII) Q4 2023 Earnings Call Transcript

2024-02-13 11:47:10 ET

LCI Industries (LCII)

Q4 2023 Earnings Conference Call

February 13, 2024 8:30 a.m. ET

Company Participants

Lillian Etzkorn - Chief Financial Officer

Jason Lippert - President and Chief Executive Officer

Kip Emenhiser - Vice President of Finance and Treasurer

Conference Call Participants

Scott Stember - ROTH MKM

Fred Wightman - Wolfe Research

Daniel Moore - CJS Securities

Mike Swartz - Truist Securities

Craig Kennison - Robert W. Baird

Patrick Buckley - Jefferies

Brandon Rolle - D.A. Davidson

Tristan Thomas-Martin - BMO Capital Markets

Presentation

Operator

Hello everyone, and welcome to the LCI Q4 2023 Earnings Call. My name is Emily, and I will be coordinating your call today. [Operator Instructions]

I will now turn the call over to our host, Lillian Etzkorn. Please go ahead.

Lillian Etzkorn

Good morning, everyone, and welcome to the LCI Industries' fourth quarter and full-year 2023 conference call. I am joined on the call today by Jason Lippert, President and CEO; and Kip Emenhiser, VP of Finance and Treasurer. We will discuss the results for the quarter in just a moment.

But first, I would like to inform you that certain statements made in today's conference call regarding LCI Industries and its operations maybe considered forward-looking statements under the securities laws, and involve a number of risks and uncertainties. As a result, the company cautions you that 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 are discussed in our earnings release and in our Form 10-K, and other filings with the SEC. The company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date of the forward-looking statements, except as required by law.

So, with that, I would like to turn the call over to Jason.

Jason Lippert

Thanks, Lillian, and good morning, everybody, and welcome to our fourth quarter and full-year 2023 earnings call. Last year proved to be an eventful year for Lippert as we work to extend our position as an industry leader, while navigating a challenging environment around the RV and marine businesses. Despite continued softness in the RV industry throughout 2023, along with a slow-down in the marine industry in the second-half, our consistent execution on diversification priorities and steadfast commitment to operational discipline helped to lift our performance. As we face these headwinds, our teams took action by leveraging our operational expertise. These customer relationships and robust culture of innovation drive the business forward.

Looking at the full-year, we closed 2023 with $3.8 billion in revenue, declining year-over-year from last year's $5.2 billion in revenues, due largely to lower RV going in and marine industry production levels as dealers work to right-size inventories in both markets. That said, it is important to emphasize the durability of our business. As many of you know, we have significantly diversified Lippert beyond recreational vehicles into transportation vehicles, marine, automotive, residential, and their aftermarkets, as well as into Europe. And that effort is now paying dividends. In fact, over the past five years, we have successfully executed our strategic playbook by growing revenues in new markets by nearly [50%] (ph), which has bolstered our diversification.

In this quarter, that growth was underscored by the strength of our growing aftermarket businesses. To be clear, these results would not have been possible if we focused our attention on the RV space alone. Instead, by applying our core manufacturing competencies to gain a foothold of adjacent markets, we have created a range of what we believe are countercyclical revenue streams with a combined $11 billion-plus in total addressable growth opportunity. We're working hard to continue to grow these opportunities, both organically and through acquisitions. Net sales from acquisitions completed in 2022 and 2023, the majority of which are focused outside of North American RV, contributed approximately $74 million of revenue in 2023....

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