LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript

Insider Monkey05-09

LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript May 8, 2024 LCI Industries isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here)....

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2434123150?lang=en_US&edition=fundamental","thumbnail":"https://s.yimg.com/uu/api/res/1.2/l_cOHGESOz_Or6pV03FwbQ--~B/aD04MTY7dz0xNDU2O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/insidermonkey.com/d1273ba1182bb8fcbbeecf2f43a9f6bf","is_english":true,"pubTime":"2024-05-09 23:36","share_image_url":"https://static.laohu8.com/5f26f4a48f9cb3e29be4d71d3ba8c038","id":"2434123150","market":"us","top_or_hot":-1,"title":"LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript","media":"Insider Monkey","content":"<div>\n<p>LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript May 8, 2024\nLCI Industries isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here)....</p>\n\n<a href=\"https://finance.yahoo.com/news/lci-industries-nyse-lcii-q1-153628829.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nLCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-05-09 23:36 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/lci-industries-nyse-lcii-q1-153628829.html><strong>Insider Monkey</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript May 8, 2024\nLCI Industries isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here)....</p>\n\n<a href=\"https://finance.yahoo.com/news/lci-industries-nyse-lcii-q1-153628829.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"NYSE","symbol_name":"纽交所","start_time":0,"source_url":"https://finance.yahoo.com/news/lci-industries-nyse-lcii-q1-153628829.html","article_id":"2434123150","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/l_cOHGESOz_Or6pV03FwbQ--~B/aD04MTY7dz0xNDU2O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/insidermonkey.com/d1273ba1182bb8fcbbeecf2f43a9f6bf"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2434123150","pubTimestamp":1715268988,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"LCI Industries isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter .Operator: Hello, everyone and welcome to the LCI First Quarter Earnings Call. My name is Emily and I’ll be moderating your call today. [Operator Instructions] I will now turn the call over to our host, Lillian Etzkorn to begin.For Q1 2024, we delivered $968 million in revenue, up 16% sequentially. Our aftermarket segment led the way with solid operating margins of 11.8%, along with other parts of our adjacent markets, while our RV OEM business is improving from prior quarters. To date, we are tracking to the $200 million of organic growth increase across our business that we announced last quarter. In the first quarter of 2024, 57% of our total sales were derived from our businesses outside of North American RV OEM. Even with the significant growth we have alre","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"NYSE":"纽交所","LCII":"LCI Industries"},"translate_title":"LCI工业（纽约证券交易所代码：LCII）Q1 2024年收益看涨期权记录","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"LCII":1,"NYSE":1},"content_text":"LCI Industries (NYSE:LCII) Q1 2024 Earnings Call Transcript May 8, 2024\nLCI Industries isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).\nOperator: Hello, everyone and welcome to the LCI First Quarter Earnings Call. My name is Emily and I’ll be moderating your call today. [Operator Instructions] I will now turn the call over to our host, Lillian Etzkorn to begin.\nLillian Etzkorn: Good morning, everyone, and welcome to the LCI Industries first quarter 2024 conference call. I am joined on the call today with Jason Lippert, President and CEO; along with 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 may be considered forward-looking statements under the security 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.\nThese factors are discussed in our earnings release and in our Form 10-K and in 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 the forward-looking statements are made, except as required by law. With that, I would like to turn the call over to Jason.\nJason Lippert: Thanks, Lillian, and good morning. I’d like to welcome everyone to our first quarter 2024 earnings call. We have started off the year exceeding expectations with strong profits and margin expansion in the first quarter, driven almost entirely by the continued strength in our diversified businesses and our disciplined operational execution. It is important to emphasize that Lippert is fundamentally much more than just a supplier to RV OEMs, thanks to our strategic execution around diversification over the last decade. The global expansion of Lippert brand into growing markets like transportation, building products, automotive, marine and RV aftermarkets, manufactured housing, Europe and other adjacencies has been a key boost to performance in recent years, helping mitigate the cyclical impact that the RV industry can have.\nFor Q1 2024, we delivered $968 million in revenue, up 16% sequentially. Our aftermarket segment led the way with solid operating margins of 11.8%, along with other parts of our adjacent markets, while our RV OEM business is improving from prior quarters. To date, we are tracking to the $200 million of organic growth increase across our business that we announced last quarter. In the first quarter of 2024, 57% of our total sales were derived from our businesses outside of North American RV OEM. Even with the significant growth we have already achieved in these markets, we still have an extensive runway with over $11 billion in combined total addressable growth opportunities ahead of us. Of our addressable growth opportunities, we estimate over $5 billion of potential in aftermarket and over $4 billion in combined international and adjacent markets.\nGiven this runway and backed by a solid balance sheet, we plan to continue to seek out and invest in more organic growth, as well as strategic opportunities to further diversify our business. Additionally, we continue to execute on operational improvements in the quarter as part of our focus on streamlining production and reducing fixed costs while keeping capacity flexible. We have consolidated several facilities over the past year, effectively reducing almost 1.2 million square feet of production space while maintaining similar levels of production capacity. Our teams also achieved direct and indirect cost improvements ahead of schedule, driving down input costs and significantly improving margins in the quarter. We continue to invest in automation to drive efficiencies and have put more resources and automation within our footprint, which we believe significantly differentiates us in the outdoor recreation space.\nFor example, as we finish building and equipping our $65 million glass and acrylic processing center, we can now process hundreds of thousands of pieces of glass on a monthly basis for use in a wide range of end markets from housing, RV, marine, commercial glass, solar glass and much more to efficiently meet demand across our diversified businesses. We believe that this show piece sets a new standard, giving us competitive edge and showcasing our commitment to investing in quality manufacturing for the future. In addition, this automated facility also has started building acrylic windows for RVs in the U.S. like the ones we sell in Europe. The importance of this can’t be underscored enough as we believe we are the only supplier in North America building this product.\nAs acrylic windows become more widely used in the market, it will help us widen our moat in this important category. We remain hard at order to identify and capture strategic growth opportunities such as our recently announced deal with Camping World through which we purchased their furniture business unit. As many know, Camping World embarked in a multiyear journey of exploring vertical integration, and we believe that they felt that their financial and labor resources were much better spent in other strategic areas. One of those areas identified by markets on the CW team was that of revamping their retail store and online space with a new look and new partners. Part of the strategic move for both companies was to figure out how the Lippert brand can help bolster camping world online and in-store sales.\nTurning to RV during the first quarter, content per towable RV decreased from the prior year to $5,097, while content for motorhome RV for the quarter was $3,656. While content was down slightly in both areas year-over-year, driven largely by index pricing reductions, we saw sequential organic growth of 1% for towable and 4% for motorhome content over Q4 of 2023. Because of the impact of our innovation, our content continues to grow. Since 2020, our content has drawn over 50% on total RVs demonstrating our ability over time to continue to innovate great content to OEMs. RV OEM dealers are continuing to closely manage inventory levels with most of them bringing in just what they need for the spring season. That said, we are seeing positive trends for spring as we grew North American RV OEM sales by 17% in the quarter over last year Q1.\nMotorhomes will likely be a drag on the industry wholesale for the next 12 months, and we also expect totals to soften after July with a possible pickup in production close to year end. All in all, these factors put us close to our wholesale forecast from late last year of around 325,000 to 350,000 total units. We do feel that 2025 will be slightly better than 2024. And as we have seen historically, we believe that we will likely have some sequential solid years of slow and steady growth post downturn. RV production for April was up slightly from March, and we expect May to be on par or just slightly ahead of April. We are diligently monitoring these trends as we work to ramp up production in support of the spring selling season. OEMs appear to be mixed on downtime for the July 4th holiday, with some taking 1 week and others taking 2.\nWe believe that a huge differentiator for Lippert is the short lead times we’re able to offer RV OEMs on our products due to our footprint and business processes. Our facilities can swiftly provide products with typically only a week of lead time with the ability of accommodating emergency demand as well. This agility, coupled with the fact that our facilities are generally close in proximity to our RV customers allows us to offer just-in-time inventory to OEMs, eliminating the need for them to carry any more inventory than needed, helping reduce our customers’ costs. We believe that this is a big part of our moat when competitors try to supply the industry with competing products outside of Elkhart County or even outside the country. Industry partnerships are another key way we are strengthening our brand and advancing our leading position in the outdoor recreation space.\nRecently, we held our Anti-Lock Braking System Spring Showcase, where Bob Martin, CEO of Thor Industries, and many other industry leaders and RV enthusiasts test drove our new ABS brakes on the Navistar track in Northern Indiana. Taking customers to the track and giving them a real-life experience has really helped in highlighting how much of a difference we believe ABS can make for safely towing both travel trailers and fifth wheels. Towing is one of the biggest hurdles for new buyers to get over, and we have found that dealers are having a much easier time giving new buyers peace of mind on units equipped with our ABS suspension systems. Turning to aftermarket, our aftermarket net sales were $210 million for the quarter, down 3% to the same period in 2023.\nWhile our automotive aftermarket was up double digits, our RV and marine businesses were nearly flat due to dealers being overly cautious about taking on more inventory. Despite the small top line decline, we still achieved a 200 basis point increase in operating margins due to improved mix along with tailwinds from continued operational efficiencies. We are proud of our aftermarket teams for hitting an operating margin of double digits for the quarter, solidifying the importance of a diversified business. As literally millions of vehicles approach the repair and replacement cycle in the coming years, we believe our aftermarket business is very prepared to capture demand for service support as well as replacement and upgraded content. This should be one of the single largest impacts in our business over the coming years as hundreds of thousands of vehicles come into service, needing our parts.\nWe believe that the greater the content on the vehicles, the greater our service parts business. Based on our content increases over the years, these vehicles will be entering service with the greatest amount of Lippert content we’ve ever seen. Our automotive aftermarket brand CURT continues to thrive, representing over half of all effort aftermarket sales. Last year alone, CURT sold just shy of 1 million hitches, and we are confident that this will continue in 2024. Since our acquisition of the CURT family of products in late 2019, we have seen that business grow over 40% of the top line. The appliance market also offers substantial growth opportunity potential to our aftermarket, with Furrion ovens, hot water heaters, refrigerators and air conditioners driving market share and top line expansion.\nOur new supply agreement with Camping World should help increase our aftermarket top line for RV not only due to the fact that Camping World has such a large footprint, but also because we believe Camping World will continue to execute on new store acquisitions and start-ups, taking our retail footprint with them as they continue their expansive growth towards their stated 320 stores by 2028. Alongside our expanding parts and service business, we are actively seeking ways to engage consumers and dealers to gather feedback to enhance our products. We believe that Lippert Technical Institute has been instrumental by hosting maintenance trainings for dealer technicians and RV owners, empowering them to help prolong life span of the vehicles and resolve issues efficiently while enabling more time on the road.\nWe also believe that having what we consider to be the best in industry customer service and striving to be among the easiest to do business with and over 1 million transactions annually with dealers and consumers are strong differentiators for those groups. We believe the main engine for our aftermarket business is the continuous improvement of our customer service and the experience of every single customer. During the quarter, we also hosted the annual Installer Council Summit in Eau Claire Wisconsin, where we engage with customers and gather important feedback to leverage in our automotive aftermarket product development. Events like this, along with our other initiatives like Lippert Scouts, the Campground Project, consumer rallies and Lippert ambassadors help us to build our relationship with a well-connected outdoor community, with the hope of driving trust and long-term loyalty to the Lippert brand.\nTurning to North American adjacent markets, first quarter revenues were down 17% compared to prior year due to ongoing softness in the marine retail environment. This softness is expected to continue throughout the year, however, we anticipate that marine wholesale will start improving towards year-end. We remain focused on leveraging our innovation engine to drive new product introductions while adding new efficiencies to support profitability in the current down cycle. We also expect easier year-over-year comps in this area as we head into the second half of 2024. We are showing solid results in the other adjacent markets, including manufactured housing, utility trailers and commercial vehicles. These markets are continuing to grow, and we are also seeing our market shares increase for products like our residential windows and trailer axle and suspension products.\n\nAs we have stated over the last couple of calls, our axle and suspension products business continues to grow, especially in the trailer space, where there are over 500,000 utility and cargo-type trailers built annually. In this area, we have added almost $90 million in new business since 2022. Also in our adjacent markets, we saw a strong start for our newly launched bus chassis stretching and transit bus seating products. This was a great organic startup that began in 2024, where we utilize buildings and team members that we already have in the business. Moving outside of North America, our international business grew 5% over the prior year as our international aftermarket business continues to grow and European RV dealers continue to take on more inventory.\nSince the time we started investing in Europe, we have noticed that their business cycles are much less cyclical than what we are accustomed to in North America, which helps smooth out our revenues. We believe that our products such as pop tops, acrylic windows, bed lifts, doors and electronics, exemplify how our global presence fosters innovation across our brands, and we are continuing to see a warm reception of these European developed products when we introduce them to our North American market. We expect Europe’s growth and performance to continue as we keep looking for new products and strategic options for this important market. As many of you know, innovation serves as the fundamental piece of our growth strategy. We made significant investments in our R&D capabilities and remain confident that our innovation will continue fueling the development of new products that savvy consumers are looking for, which helps bolster our competitive edge and increased revenues.\nIn addition to the new product development, we are also focused on making improvements to existing products, adding additional content consumers deem of value at a more premium price point. Historically, this strategy has provided us with significant opportunity for long-term content growth, as there are numerous products in our portfolio that we will try to continue to enhance and evolve. Additionally, these improvements and innovations are typically unique and essential to RVs, helping to make them resistant to commoditization and mitigate their risk of decontenting by OEMs. In most cases, by adding content like glass to entry doors, chassis modifications or anti-lock braking systems to axles, it helps to make us more competitive and less susceptible to intense competition.\nWe believe the anti-lock brakes have been a significant example of how we innovate for and anticipate customer needs. Anti-lock brake systems were not readily available or affordable in the U.S. for RV production until we brought them to market last year. Since launching, we now have over 10 high-profile towable RV brands using ABS with more in the process of committing a model change, growing our market share into the double digits with a total addressable market of $150 million to $200 million. In addition, we just launched coil spring independent suspension to lessen vibrations from the road to the trailer box, which should significantly lessen the shakedown that trailers experience on the road, thus greatly improving quality issues for the OEM.\nIn addition to these new products, our 4K Window series with integrated shades and unique square window design, new slide out, new high-capacity quiet air conditioners, new leveling, bus heating, furnaces, a new line of electric biminis and many more new products should gain momentum as we move through 2024. As we expand our portfolio, our focus remains on introducing innovative products that cater to a multitude of customer taste and needs in the diversified markets we serve. As we have long stated, our culture starts with the experience and empathetic leaders at the top who are constantly growing and developing their own leadership. We believe that great leadership drives retention, and higher retention is directly linked in increases in innovation, safety, efficiency and quality, all of which are key drivers of success in any business.\nJust a few weeks ago, during our volunteer week, we hosted our annual packout event where more than 1,200 Lippert team members showed up and packed over 144,000 items to be donated to the Boys & Girls Clubs of Elkhart and St. Joe counties, as well as other organizations and local schools. More than 2,200 team members participated in volunteer week company-wide. It was yet another opportunity to demonstrate how business can be a force for good, utilizing our teams to make an impact in the communities where we live and work. The best thing about this is that we see more businesses adapting to follow our lead and set up their own larger-scale community impact efforts. Additionally, we held the Serve With a Purpose event at the JcoJubile Rally, where attendees from all over the country gather to pack boxes told essential items, including clothing, school supplies and hygiene products to be donated to local boys and girls clubs.\nThanks to our large scale and company-wide focus on supporting communities around us, we were named as one of America’s most responsible companies in 2024 by Newsweek, an honor we are quite proud to have received. We remain focused on disciplined working capital management, including improving inventory turns and have line of sight to additional inventory reductions this year to support cash generation. Just only about a year ago, our inventory was nearly $1 billion and is now sitting, at the end of March, around $734 million. Our team is laser-focused on cash management. We plan to continue to invest in R&D and innovation while pursuing strategic growth opportunities and returning capital to shareholders. At the present, we are holding more conversations around strategic acquisitions with some very intentional targets.\nIt feels like we are getting back on track with our more normal historical cadence of acquisitive growth after taking a breather last year to conserve capital given the RV environment. In closing, I’d like to thank all of our global team members for their hard work and consistent dedication in moving Lippert forward this past quarter. Every week, I visit at least 1 facility and meet with our frontline team members, leaders and management, and it’s amazing to see what a talented group of people we have leading the businesses all over the company. With the guidance of our experienced leaders, we plan to continue to execute on our strategic priorities, driving to provide best-in-class service to our customers while delivering profitable and diversified growth and long-term shareholder value.\nI will now turn to Lillian Etzkorn, CFO, to give more detail on our financial results.\nLillian Etzkorn: Thank you, Jason. Our consolidated net sales for the first quarter were $968 million, a decrease of 1% from first quarter 2023. This was primarily driven by lower North American marine production levels and decreased selling prices which are indexed to select commodities, mostly offset by increased North American RV wholesale shipments. On a sequential basis, we were up 16% from Q4 of 2023, delivering strong growth across most of our markets. OEM net sales for the first quarter of 2024 were $758 million, roughly flat with the same period of 2023. RV OEM sales for the first quarter of 2024 were $460 million, up 15% compared to the prior year period, driven by a 9% increase in North American RV wholesale shipments, partially offset by decreased selling prices, which are indexed to select commodities.\nContent per towable RV unit was $5,097, while content per motorized unit was $3,656. Both were down compared to the prior year period, primarily attributed to the index pricing pass-throughs. We had sequential growth of $39 for Towable and $150 for motorhome content over Q4 of 2023. We have continued to increase our organic content and market share through our focus on innovation. In Q1 of 2024, our organic growth contributed approximately 1.6% year-over-year in LTM content per unit. Adjacent industries OEM net sales for the first quarter of 2024 were $299 million, down 17% year-over-year primarily due to lower sales to North American marine OEMs. North American Marine OEM net sales in the first quarter of 2024 were $65 million, down 45% year-over-year, driven by inflation and rising interest rates impacting retail consumers.\nAs Jason mentioned, we anticipate the softness to continue throughout the year. However, we anticipate that pressure on marine sales will start decreasing towards the end of the year as we begin to cycle easier comp. Q1 2024 sales in the aftermarket business decreased 3% compared to the prior year period, primarily driven by lower volumes within marine markets and pressure on discretionary spending. This was partially offset by growth in the automotive aftermarket, where we have been realizing strong market share gains. International sales increased 5% year-over-year, and we have been pleased with the performance of the team and strong market reception to our innovative products. The strength seen in our diversified businesses continue to support our profit and margin performance.\nGross margins were 23.1% compared to 19.1% in the prior year period, primarily due to lower material and freight costs. Additionally, warranty costs decreased $8 million compared to prior year. I do want to comment that we achieved this margin expansion earlier in the year than originally anticipated, so although we will deliver our highest margin in Q2 due to seasonality, first quarter will be the high watermark for margin expansion through the balance of the year. Consolidated operating profit during the first quarter was $58 million or 6%, which is an improvement of 390 basis points over prior year. The aftermarket segment delivered strong operating profits in the quarter at 11.8%, which is a 220 basis point improvement over prior year. GAAP net income in Q1 of 2024 was $36.5 million or $1.44 earnings per diluted share compared to a net income of $7.3 million or $0.29 earnings per diluted share in Q1 of 2023.\nEBITDA increased 72% to $90.3 million for the first quarter of 2024 compared to the prior year period. Non-cash depreciation and amortization was $32.7 million for the 3 months ended March 31, 2024, while noncash stock-based compensation expense was $4.3 million for the same period. We anticipate depreciation and amortization to be in the range of $130 million to $140 million during the full year 2024. For the 3 months ended March 31, 2024, cash used in operating activities was $8 million, with $9 million used for capital expenditures and $27 million returned to shareholders in the form of dividends. These results are in-line with our expectations as we typically have relatively higher cash use at the beginning of the calendar year due to the seasonality of production and sales.\nAt the end of the first quarter, we had an outstanding net debt position of $833 million, 2.5x pro forma EBITDA, which is adjusted to include LTM EBITDA of acquired businesses and the impact of non-cash and other items as defined in our credit agreement. Overall, we are seeing positive signs in total revenue, both sequentially and year-over-year. For the month of April, sales were up 12% to $378 million versus April of 2023. This is primarily due to 3 more RV production days in 2024 compared to the prior year period. This was partially offset by a significant decline in marine sales in the month compared to 2023. We do expect marine softness to continue, but we expect pressure to abate somewhat as we cycle easier comps in the second half of 2024.\nAs Jason stated earlier, although we do not have a great amount of visibility into the full year, we are seeing continued positive production trends in the near-term. Gradual improvements in the RV OEM market, coupled with continued performance in our diversified businesses will continue to drive Lippert forward. Regarding RV wholesale shipments, we estimate a full year range of 325,000 to 350,000 units. As we look forward, we are focused on maintaining the strong balance sheet and targeting a long-term leverage of 1.5x net debt to EBITDA. For the full year of 2024, capital expenditures are anticipated in the range of $55 million to $75 million. We remain confident in its ability to achieve long-term profitability and value for all stakeholders.\nThrough our strategic initiatives and investments and innovation, facilities and our team, we will continue along the path to delivering sustainable long-term growth. That is the end of our prepared remarks. Operator, we are ready to take questions. Thank you.\nSee also\n  Wall Street Analysts See Upside Potential for 10 Stocks with Rising Price Targets and\n  10 Future Dividend Kings in the Next 5 Years or Less.\nTo continue reading the Q&A session, please click here.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2434123150"}