• Total Revenue: $1.1 billion, an increase of 4% year-over-year.

• RV OEM Revenue: $490 million, up 20% compared to the prior year.

• Aftermarket Net Sales: $258 million, up 1% year-over-year.

• Gross Margin: 25.3%, up from 21.5% in the prior year period.

• Operating Profit Margin: 8.6%, a 320 basis point improvement over the prior year.

• EBITDA: $122.6 million, a 39% increase compared to the prior year period.

• Net Income: $61.2 million or $2.40 earnings per diluted share, compared to $33.4 million or $1.31 earnings per diluted share in Q2 2023.

• Operating Cash Flow: $439 million over the last 12 months.

• Inventory Reduction: $142 million year-over-year reduction in inventories.

• Cash and Cash Equivalents: $130 million as of June 30, 2024.

• Net Debt: $699 million, 2x pro forma EBITDA.

• Warning! GuruFocus has detected 7 Warning Signs with LCII.

Release Date: August 06, 2024

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

Positive Points

• LCI Industries Inc (NYSE:LCII) reported a 4% year-over-year increase in total revenue, reaching $1.1 billion for the quarter.

• The company achieved a nearly 40% rise in EBITDA and expanded margins by over 300 basis points.

• LCI Industries Inc (NYSE:LCII) successfully reduced inventories by $142 million year-over-year, contributing to strong cash generation.

• The acquisition of Camping World's furniture business has already driven a 30% increase in aftermarket sales.

• LCI Industries Inc (NYSE:LCII) continues to innovate with new products like the Chill Cube Air Conditioner and ABS brake technology, which are gaining positive industry feedback.

Negative Points

• The company anticipates a decline in overall revenues by about 5% year-over-year in the third quarter, with RV and marine segments facing challenges.

• Marine revenue was down 33% compared to the prior year, attributed to ongoing softness in the marine retail environment.

• LCI Industries Inc (NYSE:LCII) expects continued pressure from higher interest rates impacting consumer sentiment and retail demand.

• The company is experiencing a mix shift towards smaller RVs, which has led to a slight decline in content per RV unit.

• LCI Industries Inc (NYSE:LCII) is cautious about the near-term outlook, tempering expectations for 2024 wholesale shipments due to retail demand headwinds.

Q & A Highlights

Q: Lillian, you mentioned that overall sales for the third quarter are expected to be down 5%, yet July sales were up 6%. Can you explain the expected deceleration? A: The difference is due to the timing of shutdowns. Last year, we had extended shutdowns post-July 4th due to demand, which we didn't have this year. However, we anticipate extended shutdowns around Labor Day and in September, primarily affecting the RV segment.