Exhibit 99.1
FOR IMMEDIATE RELEASE |  | |||||||
Contact: Lillian D. Etzkorn, CFO | ||||||||
Phone: (574) 535-1125 | ||||||||
E Mail: LCII@lci1.com | ||||||||
LCI INDUSTRIES REPORTS THIRD QUARTER FINANCIAL RESULTS
Executing on diversification, operational improvements, and innovation
to drive long-term performance with continued strong performance in the Aftermarket Segment
Third Quarter 2023 Highlights
•Net sales of $1.0 billion in the third quarter, down 15% year-over-year
•Net income of $26 million, or $1.02 per diluted share, in the third quarter, down 58% year-over-year
•EBITDA of $79 million, down 34% year-over-year
•Continued execution of diversification strategy with Aftermarket Segment and Adjacent Industries OEM net sales exceeding 56% of total net sales for the twelve months ended September 30, 2023
•Inventory reduction of $238 million year-to-date through September 30, 2023
•Cash flows from operating activities of $389 million year-to-date through September 30, 2023
•Net repayments of indebtedness of $211 million year-to-date through September 30, 2023
•Quarterly dividend of $1.05 per share paid, totaling $27 million in the third quarter and $80 million year-to-date
Elkhart, Indiana - November 7, 2023 - LCI Industries (NYSE: LCII) which, through its wholly-owned subsidiary, Lippert Components, Inc. ("Lippert"), supplies a broad array of highly engineered components for the leading original equipment manufacturers ("OEMs") in the recreation, transportation products, and housing markets, and the related aftermarkets of those industries, today reported third quarter 2023 results.
“Our commitment to diversification and operational discipline continues to support our performance in a volatile macro environment. The strength we are seeing in our diversified businesses, highlighted by substantial margin expansion in Aftermarket, greatly contributes to the long-term growth and profitability prospects of Lippert, helping us weather challenges far better than if we competed solely in the RV OEM space,” commented Jason Lippert, LCI Industries’ President and Chief Executive Officer. “With our diverse set of manufacturing capabilities, continuous new product launches, and broad industry and customer portfolios serving as significant differentiators, we have continued to drive organic content growth even as we have seen selling prices decline. Just in the last four years, we have added sales of $0.9 billion from acquisitions and another $1 billion in organic sales growth. Further, through the investments made in our facilities and teams over the years, we have established strong manufacturing capabilities allowing us to develop deep customer relationships, solidifying Lippert’s position as a leader across the outdoor recreation space. Additionally, new business commitments for 2024 across our businesses total approximately $185 million. We believe these are tremendous organic growth and market share wins for next year.”
“We have an incredibly experienced team that has led our business through downturns like this one in the past and each time we have come out stronger as a result of their great leadership. With our strong balance sheet, reinforced by the substantial inventory reductions we have made throughout the year, we believe we are well-positioned to manage through near-term challenges and capture growth opportunities once conditions improve,” Lippert continued. “I want to thank all of the Lippert team members worldwide for their dedication and hard work this quarter as we navigate challenging conditions and focus on generating sustained value for all our stakeholders.”
Third Quarter 2023 Results
Consolidated net sales for the third quarter of 2023 were $1.0 billion, a decrease of 15% from 2022 third quarter net sales of $1.1 billion. Net income in the third quarter of 2023 was $25.9 million, or $1.02 per diluted share, compared to net income of $61.4 million, or $2.40 per diluted share, in the third quarter of 2022. EBITDA in the third quarter of 2023 was $78.9 million, compared to EBITDA of $119.8 million in the third quarter of 2022. Additional information regarding EBITDA, as well as a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure of net income, is provided in the "Supplementary Information - Reconciliation of Non-GAAP Measures" section below.
The decrease in year-over-year net sales for the third quarter of 2023 was primarily driven by decreased North American RV wholesale shipments, lower North American marine production levels, and decreased selling prices which are indexed to select commodities, partially offset by acquisitions. Net sales from acquisitions completed in the twelve months ended September 30, 2023 contributed approximately $16.9 million in the third quarter of 2023.
October 2023 Results
October 2023 consolidated net sales were approximately $344 million, down 1% from October 2022, primarily due to an approximate 10% decline in North American RV wholesale shipments and an approximate 3% decline due to decreased selling prices which are indexed to select commodities compared to October 2022. October 2023 results were favorably impacted by our diversification efforts, including 15% growth in adjacent markets and 5% growth in the Aftermarket Segment compared to October 2022.
OEM Segment
OEM net sales for the third quarter of 2023 were $728.5 million, down 20% year-over-year, primarily driven by a 21% reduction in North American wholesale shipments, decreased selling prices which are indexed to select commodities, and lower North American marine production levels. Operating profit of the OEM Segment was $11.2 million in the third quarter of 2023, or 1.5% of net sales, compared to $65.2 million, or 7.1%, in the same period in 2022. The operating profit of the OEM Segment for the quarter was driven by decreased selling prices which are indexed to select commodities and the impact of fixed costs on reduced sales.
RV OEM
RV OEM net sales for the third quarter of 2023 were $429.2 million, down 26% compared to the same prior year period, driven by a 21% decline in North American wholesale shipments.
Adjacent Industries OEM
Adjacent Industries OEM net sales for the third quarter of 2023 were $299.2 million, down 11% year-over-year, primarily due to lower sales to North American marine OEMs. North American marine OEM net sales in the third quarter of 2023 were $72.5 million, down 42% year-over-year.
Aftermarket Segment
Aftermarket net sales for the third quarter of 2023 were $230.8 million, up 5% year-over-year, as distribution channel inventories stabilized. Operating profit of the Aftermarket Segment was $34.4 million in the third quarter of 2023, or 14.9% of net sales, compared to $22.4 million, or 10.2%, in the same period in 2022. The operating profit expansion of the Aftermarket Segment for the quarter was driven by decreased commodity costs and leveraging of fixed costs over larger sales and production volume.
Income Taxes
The Company's effective tax rate was 26.6% for the quarter ended September 30, 2023, compared to 23.9% for the quarter ended September 30, 2022. The rate was impacted by a decrease to the life insurance contract assets related to the deferred compensation plan.
Balance Sheet and Other Items
At September 30, 2023, the Company's cash and cash equivalents balance was $31.2 million, compared to $47.5 million at December 31, 2022. The Company used $79.7 million for dividend payments to shareholders, $50.1 million for capital expenditures, and $25.9 million for acquisitions in the nine months ended September 30, 2023. The Company also made $165.7 million in net repayments under its revolving credit facility and $45.8 million in repayments under its term loan and other borrowings in the nine months ended September 30, 2023.
The Company's outstanding long-term indebtedness, including current maturities, was $908.8 million at September 30, 2023, and the Company was in compliance with its debt covenants.
Conference Call & Webcast
LCI Industries will host a conference call to discuss its third quarter results on Tuesday, November 7, 2023, at 8:30 a.m. Eastern time, which may be accessed by dialing (833) 470-1428 for participants in the U.S. and (646) 904-5544 for participants outside the U.S. using the required conference ID 356208. 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 (866) 813-9403 for participants in the U.S. and (929) 458-6194 for participants outside the U.S. and referencing access code 105381. 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, Lippert, supplies, domestically and internationally, a broad array of highly engineered components for the leading OEMs in the recreation, transportation products, and housing markets, consisting primarily of recreational vehicles and adjacent industries, including boats; buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; 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, as well as direct to retail customers via the Internet. Lippert'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; appliances; air conditioners; televisions and sound systems; tankless water heaters; and other accessories. Additional information about Lippert and its products can be found at www.lippert.com.
Forward-Looking Statements
This press release contains certain "forward-looking statements" with respect to our financial condition, results of operations, profitability, margin growth, 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, covenant compliance, retail and wholesale demand, integration of acquisitions, R&D investments, commodity prices, 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 future pandemics, geopolitical tensions, armed conflicts, or natural disaster, 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, 2022, 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 September 30, | Nine Months Ended September 30, | Last Twelve | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | Months | |||||||||||||||||||||||||
| (In thousands, except per share amounts) | |||||||||||||||||||||||||||||
| Net sales | $ | 959,315 | $ | 1,132,079 | $ | 2,947,264 | $ | 4,312,797 | $ | 3,841,610 | |||||||||||||||||||
| Cost of sales | 748,367 | 879,025 | 2,332,125 | 3,186,415 | 3,079,564 | ||||||||||||||||||||||||
| Gross profit | 210,948 | 253,054 | 615,139 | 1,126,382 | 762,046 | ||||||||||||||||||||||||
| Selling, general and administrative expenses | 165,358 | 165,479 | 494,332 | 550,317 | 664,276 | ||||||||||||||||||||||||
| Operating profit | 45,590 | 87,575 | 120,807 | 576,065 | 97,770 | ||||||||||||||||||||||||
| Interest expense, net | 10,325 | 6,910 | 30,968 | 19,353 | 39,188 | ||||||||||||||||||||||||
| Income before income taxes | 35,265 | 80,665 | 89,839 | 556,712 | 58,582 | ||||||||||||||||||||||||
| Provision for income taxes | 9,378 | 19,273 | 23,267 | 144,609 | 9,139 | ||||||||||||||||||||||||
| Net income | $ | 25,887 | $ | 61,392 | $ | 66,572 | $ | 412,103 | $ | 49,443 | |||||||||||||||||||
| Net income per common share: | |||||||||||||||||||||||||||||
| Basic | $ | 1.02 | $ | 2.41 | $ | 2.63 | $ | 16.23 | $ | 1.95 | |||||||||||||||||||
| Diluted | $ | 1.02 | $ | 2.40 | $ | 2.62 | $ | 16.15 | $ | 1.94 | |||||||||||||||||||
| Weighted average common shares outstanding: | |||||||||||||||||||||||||||||
| Basic | 25,340 | 25,447 | 25,293 | 25,398 | 25,299 | ||||||||||||||||||||||||
| Diluted | 25,504 | 25,600 | 25,405 | 25,520 | 25,434 | ||||||||||||||||||||||||
| Depreciation | $ | 18,857 | $ | 17,989 | $ | 55,974 | $ | 53,953 | $ | 74,860 | |||||||||||||||||||
| Amortization | $ | 14,412 | $ | 14,258 | $ | 42,844 | $ | 42,013 | $ | 57,204 | |||||||||||||||||||
| Capital expenditures | $ | 15,978 | $ | 32,911 | $ | 50,060 | $ | 103,748 | $ | 76,953 | |||||||||||||||||||
LCI INDUSTRIES
SEGMENT RESULTS
(unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | Last Twelve | |||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | Months | |||||||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||||
| Net sales: | |||||||||||||||||||||||||||||
| OEM Segment: | |||||||||||||||||||||||||||||
| RV OEMs: | |||||||||||||||||||||||||||||
| Travel trailers and fifth-wheels | $ | 363,573 | $ | 493,515 | $ | 1,032,866 | $ | 2,261,250 | $ | 1,389,201 | |||||||||||||||||||
| Motorhomes | 65,669 | 82,922 | 206,404 | 261,656 | 283,845 | ||||||||||||||||||||||||
| Adjacent Industries OEMs | 299,225 | 335,983 | 1,006,378 | 1,062,374 | 1,303,192 | ||||||||||||||||||||||||
| Total OEM Segment net sales | 728,467 | 912,420 | 2,245,648 | 3,585,280 | 2,976,238 | ||||||||||||||||||||||||
| Aftermarket Segment: | |||||||||||||||||||||||||||||
| Total Aftermarket Segment net sales | 230,848 | 219,659 | 701,616 | 727,517 | 865,372 | ||||||||||||||||||||||||
| Total net sales | $ | 959,315 | $ | 1,132,079 | $ | 2,947,264 | $ | 4,312,797 | $ | 3,841,610 | |||||||||||||||||||
| Operating profit: | |||||||||||||||||||||||||||||
| OEM Segment | $ | 11,165 | $ | 65,186 | $ | 29,086 | $ | 501,137 | $ | 7,099 | |||||||||||||||||||
| Aftermarket Segment | 34,425 | 22,389 | 91,721 | 74,928 | 90,671 | ||||||||||||||||||||||||
| Total operating profit | $ | 45,590 | $ | 87,575 | $ | 120,807 | $ | 576,065 | $ | 97,770 | |||||||||||||||||||
| Depreciation and amortization: | |||||||||||||||||||||||||||||
| OEM Segment depreciation | $ | 14,835 | $ | 14,213 | $ | 43,840 | $ | 43,090 | $ | 58,915 | |||||||||||||||||||
| Aftermarket Segment depreciation | 4,022 | 3,776 | 12,134 | 10,863 | 15,945 | ||||||||||||||||||||||||
| Total depreciation | $ | 18,857 | $ | 17,989 | $ | 55,974 | $ | 53,953 | $ | 74,860 | |||||||||||||||||||
| OEM Segment amortization | $ | 10,550 | $ | 10,472 | $ | 31,204 | $ | 30,668 | $ | 41,788 | |||||||||||||||||||
| Aftermarket Segment amortization | 3,862 | 3,786 | 11,640 | 11,345 | 15,416 | ||||||||||||||||||||||||
| Total amortization | $ | 14,412 | $ | 14,258 | $ | 42,844 | $ | 42,013 | $ | 57,204 | |||||||||||||||||||
LCI INDUSTRIES
BALANCE SHEET INFORMATION
(unaudited)
| September 30, | December 31, | ||||||||||
| 2023 | 2022 | ||||||||||
| (In thousands) | |||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 31,242 | $ | 47,499 | |||||||
| Accounts receivable, net | 338,847 | 214,262 | |||||||||
| Inventories, net | 791,884 | 1,029,705 | |||||||||
| Prepaid expenses and other current assets | 68,666 | 99,310 | |||||||||
| Total current assets | 1,230,639 | 1,390,776 | |||||||||
| Fixed assets, net | 472,518 | 482,185 | |||||||||
| Goodwill | 579,912 | 567,063 | |||||||||
| Other intangible assets, net | 462,412 | 503,320 | |||||||||
| Operating lease right-of-use assets | 233,740 | 247,007 | |||||||||
| Other long-term assets | 54,586 | 56,561 | |||||||||
| Total assets | $ | 3,033,807 | $ | 3,246,912 | |||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Current maturities of long-term indebtedness | $ | 566 | $ | 23,086 | |||||||
| Accounts payable, trade | 198,914 | 143,529 | |||||||||
| Current portion of operating lease obligations | 34,642 | 35,447 | |||||||||
| Accrued expenses and other current liabilities | 179,894 | 219,238 | |||||||||
| Total current liabilities | 414,016 | 421,300 | |||||||||
| Long-term indebtedness | 908,245 | 1,095,888 | |||||||||
| Operating lease obligations | 211,289 | 222,478 | |||||||||
| Deferred taxes | 25,281 | 30,580 | |||||||||
| Other long-term liabilities | 102,836 | 95,658 | |||||||||
| Total liabilities | 1,661,667 | 1,865,904 | |||||||||
| Total stockholders' equity | 1,372,140 | 1,381,008 | |||||||||
| Total liabilities and stockholders' equity | $ | 3,033,807 | $ | 3,246,912 | |||||||
LCI INDUSTRIES
SUMMARY OF CASH FLOWS
(unaudited)
| Nine Months Ended September 30, | |||||||||||
| 2023 | 2022 | ||||||||||
| (In thousands) | |||||||||||
| Cash flows from operating activities: | |||||||||||
| Net income | $ | 66,572 | $ | 412,103 | |||||||
| Adjustments to reconcile net income to cash flows provided by operating activities: | |||||||||||
| Depreciation and amortization | 98,818 | 95,966 | |||||||||
| Stock-based compensation expense | 14,027 | 20,564 | |||||||||
| Deferred taxes | — | (2,401) | |||||||||
| Other non-cash items | 4,611 | 1,174 | |||||||||
| Changes in assets and liabilities, net of acquisitions of businesses: | |||||||||||
| Accounts receivable, net | (121,914) | (18,128) | |||||||||
| Inventories, net | 246,155 | 26,508 | |||||||||
| Prepaid expenses and other assets | 31,237 | 31,304 | |||||||||
| Accounts payable, trade | 54,817 | (82,054) | |||||||||
| Accrued expenses and other liabilities | (5,060) | 471 | |||||||||
| Net cash flows provided by operating activities | 389,263 | 485,507 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (50,060) | (103,748) | |||||||||
| Acquisitions of businesses | (25,851) | (55,709) | |||||||||
| Other investing activities | 4,284 | 2,137 | |||||||||
| Net cash flows used in investing activities | (71,627) | (157,320) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Vesting of stock-based awards, net of shares tendered for payment of taxes | (9,591) | (10,805) | |||||||||
| Proceeds from revolving credit facility | 248,900 | 844,900 | |||||||||
| Repayments under revolving credit facility | (414,554) | (1,001,040) | |||||||||
| Repayments under shelf loan, term loan, and other borrowings | (45,767) | (65,852) | |||||||||
| Payment of dividends | (79,744) | (76,273) | |||||||||
| Payment of contingent consideration and holdbacks related to acquisitions | (31,857) | (57,328) | |||||||||
| Other financing activities | (834) | 1,468 | |||||||||
| Net cash flows used in financing activities | (333,447) | (364,930) | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | (446) | (2,750) | |||||||||
| Net decrease in cash and cash equivalents | (16,257) | (39,493) | |||||||||
| Cash and cash equivalents at beginning of period | 47,499 | 62,896 | |||||||||
| Cash and cash equivalents at end of period | $ | 31,242 | $ | 23,403 | |||||||
LCI INDUSTRIES
SUPPLEMENTARY INFORMATION
(unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
| September 30, | September 30, | Last Twelve | ||||||||||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | Months | ||||||||||||||||||||||||||||
Industry Data(1) (in thousands of units): | ||||||||||||||||||||||||||||||||
| Industry Wholesale Production: | ||||||||||||||||||||||||||||||||
| Travel trailer and fifth-wheel RVs | 61.5 | 73.3 | 195.7 | 359.6 | 257.7 | |||||||||||||||||||||||||||
| Motorhome RVs | 10.3 | 15.3 | 35.8 | 46.0 | 48.2 | |||||||||||||||||||||||||||
| Industry Retail Sales: | ||||||||||||||||||||||||||||||||
| Travel trailer and fifth-wheel RVs | 91.1 | (2) | 106.0 | 271.4 | (2) | 330.6 | 330.5 | (2) | ||||||||||||||||||||||||
| Impact on dealer inventories | (29.6) | (2) | (32.7) | (75.7) | (2) | 29.0 | (72.8) | (2) | ||||||||||||||||||||||||
| Motorhome RVs | 11.4 | (2) | 12.3 | 36.5 | (2) | 39.3 | 45.5 | (2) | ||||||||||||||||||||||||
| Twelve Months Ended | ||||||||||||||||||||||||||||||||
| September 30, | ||||||||||||||||||||||||||||||||
| 2023 | 2022 | |||||||||||||||||||||||||||||||
| Lippert Content Per Industry Unit Produced: | ||||||||||||||||||||||||||||||||
| Travel trailer and fifth-wheel RV | $ | 5,192 | $ | 5,862 | ||||||||||||||||||||||||||||
| Motorhome RV | $ | 3,705 | $ | 3,807 | ||||||||||||||||||||||||||||
| September 30, | December 31, | |||||||||||||||||||||||||||||||
| 2023 | 2022 | 2022 | ||||||||||||||||||||||||||||||
Balance Sheet Data (debt availability in millions): | ||||||||||||||||||||||||||||||||
Remaining availability under the revolving credit facility (3) | $ | 178.5 | $ | 369.2 | $ | 306.5 | ||||||||||||||||||||||||||
| Days sales in accounts receivable, based on last twelve months | 29.2 | 28.0 | 27.5 | |||||||||||||||||||||||||||||
| Inventory turns, based on last twelve months | 3.3 | 3.8 | 3.5 | |||||||||||||||||||||||||||||
| 2023 | ||||||||||||||||||||||||||||||||
| Estimated Full Year Data: | ||||||||||||||||||||||||||||||||
| Capital expenditures | $55 - $60 million | |||||||||||||||||||||||||||||||
| Depreciation and amortization | $130 - $135 million | |||||||||||||||||||||||||||||||
| Stock-based compensation expense | $18 - $20 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) September 2023 retail sales data for RVs has not been published yet, therefore 2023 retail data for RVs includes an estimate for September 2023 retail units. Retail sales data will likely be revised upwards in future months as various states report.
(3) Remaining availability under the revolving credit facility is subject to covenant restrictions.
LCI INDUSTRIES
SUPPLEMENTARY INFORMATION
RECONCILIATION OF NON-GAAP MEASURES
(unaudited)
The following table reconciles net income to EBITDA.
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||
| Net income | $ | 25,887 | $ | 61,392 | $ | 66,572 | $ | 412,103 | |||||||||||||||
| Interest expense, net | 10,325 | 6,910 | 30,968 | 19,353 | |||||||||||||||||||
| Provision for income taxes | 9,378 | 19,273 | 23,267 | 144,609 | |||||||||||||||||||
| Depreciation expense | 18,857 | 17,989 | 55,974 | 53,953 | |||||||||||||||||||
| Amortization expense | 14,412 | 14,258 | 42,844 | 42,013 | |||||||||||||||||||
| EBITDA | $ | 78,859 | $ | 119,822 | $ | 219,625 | $ | 672,031 | |||||||||||||||
In addition to reporting financial results in accordance with U.S. GAAP, the Company has provided the non-GAAP performance measure of EBITDA to illustrate and improve comparability of its results from period to period. EBITDA is defined as net income before interest expense, net, provision for income taxes, depreciation expense, and amortization expense during the three and nine month periods ended September 30, 2023 and 2022. The Company considers this non-GAAP measure 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 measure is not in accordance with, nor is it a substitute for, GAAP measures, and it may not be comparable to similarly titled measures used by other companies.
