Patrick Industries, Inc., a component solutions provider for the outdoor enthusiast and housing markets, reported financial results for the third quarter ended October 1, 2023.
The company reported net sales of $866 million, a decrease of $246 million, or 22% from $1.11 billion in the third quarter of 2022, which the company said was primarily driven by a decrease in unit shipments across end markets and lower pricing passed on to customers to reflect changes in certain commodity costs, partially offset by market share gains.
Additionally, the company reported an operating income of $71 million in the third quarter of 2023, decreased $22 million from $93 million in the third quarter of 2022. Operating margin of 8.2% decreased 10 basis points compared to 8.3% in the same period a year ago, primarily due to the impact of lower net sales, absorption on certain fixed distribution expenses, and an increase in non-cash amortization due to acquisitions.
Net income decreased 33% to $40 million from $59 million in the third quarter of 2022.
“Our operating results for the third quarter of 2023 are a reflection of our team’s thoughtful discipline to manage our business and drive resilient operating margins in a very dynamic environment, despite the continued reduction in shipments across our end markets,” said Andy Nemeth, Chief Executive Officer. “We have reduced our overall cost structure and reduced our inventory by $150 million from year-end 2022. Our team’s focus on labor management, automation, and continuous improvement has helped enable us to dynamically adjust our business to current market demand and industry trends, while remaining opportunistically nimble and poised, ready to pivot when opportunity presents itself or upon an uptick in our markets.”
The company’s marine segment reported revenue of $205 million for Q3, decreased 24% YoY, while estimated wholesale powerboat industry unit shipments decreased 23%. The company also reported that estimated content per wholesale powerboat unit (on a trailing twelve-month basis) increased 3% to $5,009 for the quarter.
“We continue to strategically deploy capital and reinvest in the business with the goal of achieving our long-term growth objectives and operational excellence,” president Jeff Rodino said. “This focus is also reflected in our repayment of $112 million of long-term debt during the quarter, demonstrating our commitment to maintaining our solid financial foundation and bolstering our ability to seize upon both organic and strategic opportunities. Our acquisition pipeline remains full of potential targets to continue to enhance our outdoor enthusiast platform.”
Read the full Q3 results for Patrick Industries on the company website.