Patrick Industries, Inc.

Good morning, ladies and gentlemen, and welcome to Patrick Industries' first quarter 2023 earnings conference call. My name is Karen, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note that this conference is being recorded. I will now turn the call over to Mr. Steve O'Hara, Vice President of Investor Relations. Mr. O'Hara, you may begin.

Good morning, everyone, and welcome to our call this morning. I'm joined on the call today by Anna Nemeth, CEO, Jeff Rodino, President, Jake Pekovic, CFO, and Matt Feiler, Senior Vice President of Finance. Certain statements made in today's conference call regarding Patrick Industries and its operations may be considered forward-looking statements under the securities laws. There are a number of factors, many of which are beyond the company's control, which could cause the actual results and events to differ materially from those described in the forward-looking statements. These factors are identified in our press releases, our Form 10-K for the year ended 2022, and in our other filings with the Securities and Exchange Commission. We undertake no obligation to update these statements to reflect circumstances or events that occur after the date the forward-looking statements are made. I would now like to turn the call over to Andy Nemeth.

Thank you, Steve. Good morning, ladies and gentlemen, and thank you for joining us on the call today. As we begin our discussion this morning, I want to take a moment and express our sincere and unwavering appreciation for our team members' continued dedication and commitment to drive Patrick forward through these dynamic times. Their focus on our goal of providing exceptional quality and customer service is inspiring and energizing. Through our Better Together culture, the brands that make up Patrick continue to collaborate and drive best practices while developing new and innovative product solutions in an effort to improve our performance and the value that we provide to our customers, positioning us as a leading component solutions provider to the leisure lifestyle and housing markets. Today, our portfolio is more balanced across our end markets, as our first quarter results once again reflect the benefits of our focus on strategic growth and diversification. We are realizing the returns on the investments we've made in this strategy, particularly in the marine market, which remained resilient through the first quarter. Highlighting this is the fact that despite a 54% decline in RV wholesale shipments in the first quarter, our consolidated net sales declined 33%. Our RV and marine revenue mix in the first quarter of 2023 was 41% and 31% of total revenues respectively, compared to 61% and 16%, respectively, in the first quarter of 2022. Additionally, for historical comparison purposes, this RV wholesale shipment tally represents a 21% decline versus the first quarter of 2019 or the last first quarter before the pandemic. Despite this decline in shipments, we earned adjusted EBITDA of $97 million and net income of $30 million, which are 78% and 45% higher, respectively, than the same quarter in 2019 when our business was much more heavily weighted towards RV. In short, although first quarter 2023 RV shipments were much lower than in the same period in 2019, our RV content per unit was 71% higher and our consolidated revenue was 48% higher. Net, we have a more profitable and resilient business model and stronger balance sheet with significant liquidity. While we've made progress, we continue to see significant opportunity to build an even stronger, more diversified company, which we believe will benefit all of Patrick's stakeholders. Although our end markets continue to face headwinds from inflation, rising interest rates, and overall economic uncertainty, the leisure lifestyle markets have traditionally been the first markets into and out of economic cycles. Demographics across our markets remain strong, with younger buyers having begun to enjoy the benefits of the leisure lifestyle. Additionally, housing inventory in general remains low while demand for affordable housing remains solid. Therefore, we believe these conditions will be temporary with a healthy and promising overall long-term trajectory. Turning to the numbers, our first quarter revenues decreased 33% to $900 million, and on a trailing 12-month basis, our consolidated revenues were approximately $4.4 billion. Our net income in the first quarter decreased 73% to approximately $30 million, and our net income per diluted share was $1.35. Finally, I'd like to share my sincere and heartfelt appreciation and best wishes to Jake as he begins the next chapter of his career in May and moves back home to North Carolina. He worked tirelessly to implement and strengthen our processes, software, policies, and procedures, and significantly enhanced our overall financial foundation, well positioning us for the next stage of growth. While we are disappointed to see him depart, the team he leaves in place is first rate, and will continue to work together toward our continuous improvement long after his departure. As we begin the process of finding our next permanent CFO, we are confident both in Matt's abilities and expertise in the interim, and that we will find the right individual who is ready to take on the opportunities and challenges that come as we begin the next phase of our growth. I'll now turn the call over to Jeff, who will highlight the quarter and provide more detail on our end markets.