• Full Year Revenue: $3.7 billion, down 1% year-over-year.
• Fourth Quarter Revenue: $803 million, a decrease of 4% from Q4 2023.
• OEM Net Sales (Q4 2024): $621.6 million, down 6% from Q4 2023.
• RV OEM Net Sales (Q4 2024): $376 million, down 3% year-over-year.
• Aftermarket Net Sales (Q4 2024): $181.6 million, up 1% year-over-year.
• Adjacent Industries OEM Net Sales (Q4 2024): $245.5 million, down 9% year-over-year.
• Gross Margin (Q4 2024): 21.1%, up from 19.2% in Q4 2023.
• Operating Profit Margin (Q4 2024): 2%, a 170 basis point improvement from Q4 2023.
• GAAP Net Income (Q4 2024): $10 million or $0.37 per diluted share.
• EBITDA (Q4 2024): $46 million, a 29% increase year-over-year.
• Cash Flow from Operations (2024): $370 million.
• Net Debt (End of 2024): $591 million, 1.7 times pro forma EBITDA.
• January 2025 Sales: Up 6% year-over-year, with RV sales up 17%.
• Dividend Increase: 10% to $1.15 per share.

• Warning! GuruFocus has detected 6 Warning Signs with LCII.

Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• LCI Industries Inc (NYSE:LCII) achieved a full-year revenue of $3.7 billion in 2024, demonstrating resilience despite a challenging RV and marine market.
• The company expanded its market leadership across top product categories, with a 7% organic growth in the automotive aftermarket.
• LCI Industries Inc (NYSE:LCII) increased EBITDA by $89 million through cost savings and operational improvements.
• The company successfully reduced net debt below 2 times EBITDA, generating $370 million in cash flow from operations.
• LCI Industries Inc (NYSE:LCII) reported a 17% increase in January RV sales, indicating a positive start to 2025.

Negative Points

• Consolidated net sales for the fourth quarter decreased by 4% compared to the same period in 2023.
• OEM net sales for the fourth quarter of 2024 were down 6% year-over-year.
• The marine market experienced a 15% decline in sales due to inflation and high interest rates impacting retail demand.
• The company faces a potential 50 basis point headwind from tariffs, which they are working to mitigate.
• There was a shift in unit mix towards lower content single axle travel trailers, impacting revenue negatively.

Q & A Highlights

Q: Can you provide an update on how tariffs, particularly on steel and aluminum, are impacting your outlook for the year? A: Jason Lippert, CEO: We haven't included any tariff impacts in our plan as it's still fluid. Our largest product, chassis, uses almost 99% domestic steel, so tariffs have minimal impact there. Overall, we estimate about a 50 basis point impact, which we believe we can mitigate through pricing and supplier cooperation.

Q: How do you expect the mix of single axle trailers to trend this year, and what does that mean for content per unit? A: Jason Lippert, CEO: Single axle trailer production increased last year, but we expect it to normalize by Q2. Dealers are aware of the mix situation, and we anticipate a return to more typical production levels, which should stabilize content per unit.

Q: Can you discuss the penetration and acceptance rates for your recent innovations like suspension systems and glass entry doors? A: Jason Lippert, CEO: Products like the Chill Cube and ABS are gaining traction, with ABS seeing double-digit growth in product placement. While more expensive products take longer to penetrate, we are seeing positive reception and expect continued growth.

Q: What is your outlook for operating margins in 2025, considering potential tariff impacts and other factors? A: Lillian Etzkorn, CFO: We are not providing a specific margin target but expect incremental margins of about 25%. We are focused on cost reductions and expect reasonable margin improvements, despite the tariff overhang.

Q: Can you provide more detail on your M&A pipeline and opportunities in the market? A: Jason Lippert, CEO: We have a robust M&A pipeline and are in discussions across our diversified businesses, including RV and marine. We are hopeful to execute some acquisitions this year as we have been conserving cash to maintain leverage targets.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.