LCI INDUSTRIES

Previous wording

LCI Industries ("LCII" and collectively with its subsidiaries, the "Company," the "Registrant," "we," "us," or "our"), through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), is a global leader in supplying engineered components to the outdoor recreation, transportation, and building products industries. In addition to serving original equipment manufacturers ("OEMs"), we also cater to aftermarket needs, selling through retail dealers, wholesale distributors, and service centers, as well as directly to consumers online.

Current wording

LCI Industries ("LCII" and collectively with its subsidiaries, the "Company," the "Registrant," "we," "us," or "our"), through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), is a global leader in supplying engineered components to the outdoor recreation, transportation, marine, and housing industries. In addition to serving original equipment manufacturers ("OEMs"), we also cater to aftermarket needs, selling through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms.

Previous wording

•Chassis & Suspension Solutions: Steel chassis, axles, anti-lock braking systems ("ABS"), suspension systems, and stabilizer/leveling systems (manual, electric, and hydraulic)

Current wording

•Chassis and Suspension Solutions: Steel chassis, axles, anti-lock braking systems ("ABS"), and suspension systems

Previous wording

•Interior & Appliance Solutions: Thermoformed bath and kitchen products, furniture, mattresses, tankless water heaters, air conditioners, appliances, electronic components, televisions, and sound systems

Current wording

•Appliance and Kitchen Solutions: Air conditioners, tankless water heaters, appliances, electronic components, televisions, and thermoformed bath and kitchen products

Previous wording

•Towing & Truck Accessories: Hitches, pin boxes, grill guards, towing electrical, and towing and truck accessories

Current wording

•Towing and Truck Accessories: Hitches, pin boxes, grill guards, towing electrical, and towing and truck accessories

Previous wording

•Windows, Doors & Steps: Vinyl, aluminum, and frameless windows; entry, luggage, patio, and ramp doors; and electric and manual entry steps

Current wording

•Doors, Steps, and Awnings: Entry, luggage, patio, and ramp doors, electric and manual entry steps, and awnings

Previous wording

At September 30, 2025, we operated over 100 manufacturing and distribution facilities located throughout North America and Europe, supporting key industries such as recreational vehicles ("RVs"), marine products, utility trailers, transportation, and residential and commercial construction industries. Our core manufacturing competencies include:

Current wording

At March 31, 2026, we operated over 100 manufacturing facilities located throughout North America and Europe, supporting key industries such as recreational vehicles ("RVs"), transportation, marine, and housing. Our core manufacturing competencies include:

Previous wording

We operate in two primary segments: OEM and Aftermarket. Together, these segments leverage our manufacturing competencies, leadership expertise, customer relationships, and market insights to drive efficiencies and innovation that enable us to maintain a leadership position in the RV market while continuing to expand in adjacent industries and aftermarket channels. Intersegment sales are insignificant. See Note 12 of the Notes to Condensed Consolidated Financial Statements for further information regarding our segments.

Current wording

We operate in two primary segments: OEM and Aftermarket. Together, these segments leverage our manufacturing competencies, leadership expertise, customer relationships, and market insights to drive efficiencies and innovation that enable us to maintain a leading position in the RV market while continuing to expand in adjacent industries and aftermarket channels. Intersegment sales are insignificant. See Note 12 of the Notes to Condensed Consolidated Financial Statements for further information regarding our segments.

Previous wording

OEM Segment: Our OEM Segment services leading OEMs in recreation, transportation, and housing markets. Our strategically located manufacturing and distribution facilities across North America and Europe provide efficient service to OEMs. Key markets served by our OEM Segment include RVs and Adjacent Industries.

Current wording

OEM Segment: Our OEM Segment services leading OEMs in RV, transportation, marine, and housing markets. Our strategically located manufacturing and distribution facilities across North America and Europe provide efficient service to OEMs. Key markets served by our OEM Segment include RVs and Adjacent Industries.

Previous wording

Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the recreation and transportation markets by offering discretionary accessories, replacement parts, and upgrades. This approach drives additional revenue, deepens customer engagement, and leverages our OEM expertise. Products are sold through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms.

Current wording

Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the RV, transportation, marine, and automotive markets by offering discretionary accessories, replacement parts, and upgrades. This approach drives additional revenue, deepens customer engagement, and leverages our OEM expertise. Products are sold through retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms.

Previous wording

Diversification Strategy: Over the past several years, we have diversified our portfolio beyond the RV OEM market into marine, building products, transportation, international, and aftermarket sectors. Leveraging our manufacturing competencies in other industries can accelerate profitable growth and help to mitigate seasonal and cyclical market risk. For example, within our Aftermarket Segment, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing certain sales within this segment to be counter-seasonal.

Current wording

Diversification Strategy: Over the past several years, we have diversified our portfolio beyond the RV OEM market into transportation, marine, housing, and aftermarket sectors. We have also diversified geographically through our international operations. Leveraging our manufacturing competencies in other industries can accelerate profitable growth and help to mitigate seasonal and cyclical market risk. For example, within our Aftermarket Segment, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing certain sales within this segment to be counter-seasonal.

Previous wording

According to the Recreation Vehicle Industry Association ("RVIA"), industry-wide wholesale shipments from the United States of travel trailer and fifth-wheel RVs, our primary RV market, increased 4 percent to 233,500 units in the first nine months of 2025, compared to the same period in 2024. Retail demand for travel trailer and fifth-wheel RVs of 252,200 units in the first nine months of 2025 was consistent with retail demand of 252,300 units in the same period in 2024. Retail registration data is often revised upward in subsequent months due to reporting delays.

Current wording

In the first three months of 2026 compared to the same period in 2025, Recreation Vehicle Industry Association ("RVIA") data shows United States wholesale shipments of travel trailer and fifth-wheel RVs, the Company's primary market, decreased 15 percent to 73,400 units. Retail demand for travel trailer and fifth-wheel RVs decreased 17 percent to 52,200 units in the first three months of 2026 compared to the same period in 2025. Retail registration data is often revised upward in subsequent months due to reporting delays.

Previous wording

According to the RVIA, industry-wide wholesale shipments of motorhome RVs in the first nine months of 2025 increased 3 percent to 27,600 units compared to the first nine months of 2024. Retail demand for motorhome RVs in the first nine months of 2025 decreased 7 percent to 29,700 units compared to the same period of 2024. Retail demand has declined from post-pandemic elevated levels, primarily driven by inflation and higher interest rates impacting retail consumer discretionary spending.

Current wording

In the first three months of 2026 compared to the same period in 2025, RVIA data showed wholesale shipments of motorhome RVs increased 15 percent to 10,700 units. Retail demand for motorhome RVs decreased 24 percent to 6,800 units in the first three months of 2026 compared to the same period of 2025. Retail demand has declined from post-pandemic elevated levels, primarily driven by inflation and higher interest rates impacting retail consumer discretionary spending.

Previous wording

OEM Segment - Adjacent Industries: Our expertise in RV components extends to adjacent industries, including boats, buses, trailers, trucks, trains, manufactured homes, and modular housing. These adjacent industries offer significant growth opportunities, including by helping us leverage our established relationships with OEMs that often operate in multiple sectors. While the potential content per unit we may supply to adjacent industries varies across these markets, and is different than RVs, they represent meaningful diversification opportunities.

Current wording

OEM Segment - Adjacent Industries: Our expertise in RV components extends to adjacent industries, including transportation, marine, and housing. These adjacent industries offer significant growth opportunities, including by helping us leverage our established relationships with OEMs that often operate in multiple sectors. While the potential content per unit we may supply to adjacent industries varies across these markets, and is different than RVs, they represent meaningful diversification opportunities.

Previous wording

Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the recreation and transportation markets by offering discretionary accessories, replacement parts, and upgrades through various channels, including retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer platforms. These products support recreation and transportation markets, addressing both routine maintenance needs and customer-driven enhancements.

Current wording

Aftermarket Segment: Our Aftermarket Segment enhances the product lifecycle for the RV, transportation, marine, and automotive markets by offering discretionary accessories, replacement parts, and upgrades through various channels, including retail dealers, wholesale distributors, and service centers, as well as direct-to-consumer sales through online platforms. These products support recreation and transportation markets, addressing both routine maintenance needs and customer-driven enhancements.

Previous wording

•Consolidated net sales in the third quarter of 2025 were $1,036.5 million, an increase of 13.2 percent, from $915.5 million in the same period of 2024. The increase was primarily due to sales price increases related to material costs, sales from acquired businesses, and higher North American RV sales driven by market share gains and an increased mix of higher content fifth-wheel units. Net sales from acquisitions completed in the twelve months ended September 30, 2025, primarily Freedman Seating and Trans/Air Manufacturing, contributed approximately $41.9 million in the third quarter of 2025.

Current wording

•Consolidated net sales in the first quarter of 2026 were $1.1 billion, an increase of 4.3 percent, from $1.0 billion in the same period of 2025. The increase was primarily due to sales price increases to cover higher material costs, sales from acquired businesses, North American RV sales driven by recent innovations, and an increased mix of higher content fifth-wheel units, partially offset by lower North American RV wholesale shipments. Net sales from acquisitions completed in the twelve months ended March 31, 2026 contributed approximately $46.8 million in the first quarter of 2026.

Previous wording

•Net income for the third quarter of 2025 was $62.5 million, or $2.55 per diluted share, compared to net income of $35.6 million, or $1.39 per diluted share, for the same period of 2024. Net income for the third quarter of 2025 includes the gain on sale of real estate of $19.7 million, from the sale of two facilities as part of our footprint optimization efforts.

Current wording

•Net income for the first quarter of 2026 was $62.9 million, or $2.53 per diluted share, compared to net income of $49.4 million, or $1.94 per diluted share, for the same period of 2025.

Previous wording

•Consolidated operating profit during the third quarter of 2025 was $75.4 million, compared to $53.9 million in the same period of 2024. Operating profit margin was 7.3 percent in the third quarter of 2025 compared to 5.9 percent in the same period of 2024. The increase was primarily due to reduced costs from materials sourcing strategies and leveraging of fixed expenses over higher North American RV sales volumes related to market share gains and increased mix of higher content fifth-wheel units.

Current wording

•Consolidated operating profit during the first quarter of 2026 was $95.2 million, compared to $81.3 million in the same period of 2025. Operating profit margin was 8.7 percent in the first quarter of 2026 compared to 7.8 percent in the same period of 2025. The increase was primarily due to reduced costs as a result of materials sourcing strategies and the benefits of other cost improvement actions, such as the footprint optimizations.

Previous wording

•In the third quarter of 2025, we returned an aggregate of $90.0 million to shareholders, including through share repurchases of $62.2 million and a quarterly dividend of $1.15 per share, aggregating $27.8 million.

Current wording

•In the first quarter of 2026, we paid a quarterly dividend of $1.15 per share, aggregating to $27.9 million.

Previous wording

Net sales of the OEM Segment in the third quarter of 2025 increased by $105.6 million, compared to the same period of 2024. Net sales of components to OEMs were to the following markets for the three months ended September 30:

Current wording

Net sales of the OEM Segment in the first quarter of 2026 increased by $29.3 million, compared to the same period of 2025. Net sales of components to OEMs were to the following markets for the three months ended March 31:

Previous wording

According to the RVIA, industry-wide wholesale unit shipments for the three months ended September 30 were:

Current wording

According to the RVIA, industry-wide wholesale shipments for the three months ended March 31 were:

Previous wording

The trend in our average product content per RV produced is an indicator of our overall market share of components for new RVs. Our average product content per type of RV, calculated based upon our net sales of components to domestic RV OEMs for the different types of RVs produced for the twelve months ended September 30, divided by the industry-wide wholesale shipments of the different product mix of RVs for the same period, was:

Current wording

The trend in our average product content per RV produced is an indicator of our continued engagement with our RV OEM customers. Our average product content per type of RV, calculated based upon our net sales of components to domestic RV OEMs for the different types of RVs produced for the twelve months ended March 31, divided by the industry-wide wholesale shipments of the different product mix of RVs for the same period, was:

Previous wording

Our average product content per type of RV excludes international sales and sales to the Aftermarket Segment and Adjacent Industries. Content per RV is impacted by changes in selling prices for our products, market share gains, changes in unit mix and acquisitions. For the twelve months ended September 30, 2025, travel trailer and fifth-wheel RV content increased

Current wording

Our average product content per type of RV excludes international sales and sales to the Aftermarket Segment and Adjacent Industries. Content per RV is impacted by changes in selling prices for our products, product innovations, changes in unit mix, and acquisitions. For the twelve months ended March 31, 2026, travel trailer and fifth-wheel RV content increased 12.8 percent year-over year due to sales price increases to cover higher material costs, an increase in RV mix toward higher content fifth-wheel units, and recent innovations, partially offset by shipments exceeding units produced.

Previous wording

Our increase in net sales to RV OEMs during the third quarter of 2025 was primarily driven by sales price increases related to materials costs, an increase in RV sales mix toward higher content fifth-wheel units, market share gains and an increase in North American motorhome RV unit shipments, partially offset by volume decreases in the European RV market.

Current wording

Our decrease in net sales to RV OEMs during the first quarter of 2026 was primarily due to a decrease in North American travel trailer and fifth-wheel shipments, partially offset by sales price increases to cover higher material costs, an increase in RV sales mix toward higher content fifth-wheel units, an increase in North American motorhome RV unit shipments, and recent innovations.

Previous wording

Our increase in net sales to OEMs in Adjacent Industries during the third quarter of 2025 was primarily due to sales from acquired businesses and higher sales to North American utility trailer and marine OEMs.

Current wording

Our increase in net sales to OEMs in Adjacent Industries during the first quarter of 2026 was primarily due to sales from acquired businesses and higher sales to North American marine OEMs.

Previous wording

Operating profit of the OEM Segment was $43.6 million in the third quarter of 2025, an increase of $21.7 million compared to the same period of 2024. The operating profit margin of the OEM Segment increased to 5.5 percent in the third quarter of 2025, compared to 3.2 percent for the same period of 2024, and was positively impacted by:

Current wording

Operating profit of the OEM Segment was $76.5 million in the first quarter of 2026, an increase of $14.5 million compared to the same period of 2025. The operating profit margin of the OEM Segment increased to 9.0 percent in the first quarter of 2026, compared to 7.5 percent for the same period of 2025, and was positively impacted by:

Previous wording

•The impact of fixed costs spread over increased sales, which increased operating profit by $3.8 million related to fixed production overhead costs and $3.6 million related to fixed selling, general, and administrative costs.

Current wording

•The impact of fixed costs spread over decreased production volumes, which decreased operating profit by $9.3 million related to fixed production overhead costs and $4.2 million related to fixed selling, general, and administrative costs.

Previous wording

Net sales of the Aftermarket Segment in the third quarter of 2025 increased by $15.4 million, compared to the same period of 2024. Net sales of components in the Aftermarket Segment were as follows for the three months ended September 30:

Current wording

Net sales of the Aftermarket Segment in the first quarter of 2026 increased by $15.7 million, compared to the same period of 2025. Net sales of components in the Aftermarket Segment were as follows for the three months ended March 31:

Previous wording

Operating profit of the Aftermarket Segment was $31.9 million in the third quarter of 2025, a decrease of $0.2 million compared to the same period of 2024. The operating profit margin of the Aftermarket Segment was 12.9 percent in the third quarter of 2025, compared to 13.9 percent in the same period in 2024, and was negatively impacted by:

Current wording

Operating profit of the Aftermarket Segment was $18.7 million in the first quarter of 2026, a decrease of $0.7 million compared to the same period of 2025. The operating profit margin of the Aftermarket Segment was 7.8 percent in the first quarter of 2026, compared to 8.7 percent in the same period in 2025, and was negatively impacted by:

Previous wording

•Investments in capacity, distribution and logistics technology to support continued growth in the Aftermarket Segment, which negatively impacted operating profit by $1.3 million compared to the same period of 2024.

Current wording

•Investments in capacity and distribution to support continued growth in the Aftermarket Segment, which negatively impacted operating profit by $5.6 million compared to the same period in 2025.

Previous wording

•Reduced costs from materials sourcing strategies, which increased operating profit by $1.8 million compared to the same period in 2024.

Current wording

•Reduced costs as a result of materials sourcing strategies, which increased operating profit by $1.8 million compared to the same period in 2025.

Previous wording

Interest expense, net was $26.0 million for the nine months ended September 30, 2025, compared to $23.8 million in the same period of 2024. The increase in net interest expense was primarily due to interest on the 2030 Convertible Notes and higher interest rates on our adjustable rate debt, including the Term Loans (as defined in Note 8 of the Notes to Condensed Consolidated Financial Statements) and revolving credit facility. The increase was partially offset by reduced borrowings outstanding on the revolving credit facility and interest income of $5.3 million earned on investments in money market mutual funds for the nine months ended September 30, 2025, compared to $2.8 million in the same period of 2024.

Current wording

Interest expense, net was $9.9 million for the three months ended March 31, 2026, compared to $6.0 million in the same period of 2025. The increase in net interest expense was primarily due to interest on the 2030 Convertible Notes and increased principal borrowed on our Term Loans (as defined in Note 8 of the Notes to Condensed Consolidated Financial Statements) following our refinancing in March 2025.

Previous wording

In the nine months ended September 30, 2025, we recorded an $8.9 million loss on extinguishment of debt, consisting of $6.2 million in connection with the repurchase of a portion of our 2026 Convertible Notes, $1.9 million related to the repayment of our previous term loan, and $0.8 million related to the repricing amendment for our Term Loans.

Current wording

In the three months ended March 31, 2025, we recorded an $8.1 million loss on extinguishment of debt, consisting of $6.2 million in connection with the repurchase of a portion of our 2026 Convertible Notes and $1.9 million related to the repayment of our previous term loan. No loss on extinguishment of debt was recorded for the three months ended March 31, 2026.

Previous wording

The effective tax rate for the nine months ended September 30, 2025 and 2024 was 26.1 percent and 25.2 percent, respectively. The effective tax rate for the nine months ended September 30, 2025 differed from the Federal statutory rate primarily due to state taxes, foreign taxes, and non-deductible expenses, partially offset by Federal and Indiana research and development credits. The increase in the effective tax rate for the nine months ended September 30, 2025 as compared to the same period in 2024 was primarily due to discrete tax expenses related to tax deficiencies on stock-based compensation.

Current wording

The effective income tax rate for the three months ended March 31, 2026 and 2025 was 26.2 percent and 26.5 percent, respectively. The effective tax rate for the three months ended March 31, 2026 differed from the Federal statutory rate primarily due to state taxes, foreign taxes, and non-deductible expenses, partially offset by Federal and Indiana research and development credits. The decrease in the effective tax rate for the three months ended March 31, 2026 as compared to the same period in 2025 was primarily due to the recognition of excess tax benefits on stock-based compensation.

Previous wording

As of September 30, 2025, we had $199.7 million in cash and cash equivalents, and $595.2 million of availability under our revolving credit facility under the Credit Agreement. We also have the ability to request an increase to the revolving and/or incremental term loan facilities by up to an additional $371.0 million in the aggregate upon approval of the lenders providing any such increase and the satisfaction of certain other conditions. See Note 8 of the Notes to Condensed Consolidated Financial Statements for a description of our credit facilities.

Current wording

As of March 31, 2026, we had $142.2 million in cash and cash equivalents, and $595.2 million of availability under our revolving credit facility under the Credit Agreement. We also have the ability to request an increase to the revolving and/or incremental term loan facilities by up to an additional $371.0 million in the aggregate upon approval of the lenders providing any such increase and the satisfaction of certain other conditions. See Note 8 of the Notes to Condensed Consolidated Financial Statements for a description of our credit facilities.

Previous wording

The Condensed Consolidated Statements of Cash Flows reflect the following for the nine months ended September 30:

Current wording

The Condensed Consolidated Statements of Cash Flows reflect the following for the three months ended March 31:

Previous wording

Net cash flows provided by operating activities were $252.1 million in the first nine months of 2025, compared to $263.7 million in the first nine months of 2024. The decrease in net cash flows provided by operating activities was primarily due to the net change in assets and liabilities, net of acquired businesses, as it used $39.2 million more cash in the first nine months of 2025 compared to the same period in 2024, partially offset by an increase in net income of $36.2 million. The primary use of cash in net assets was the increase of $145.8 million in accounts receivable due to seasonally higher sales in the first nine months of 2025.

Current wording

Net cash flows used in operating activities were $33.5 million in the first three months of 2026, compared to cash provided by operating activities of $42.7 million in the first three months of 2025. The change in net cash flows used in operating activities was primarily due to the net change in assets and liabilities, which used $83.6 million more cash in the first three months of 2026 compared to the same period in 2025. The net change in assets and liabilities was partially offset by an increase in net income of $13.5 million. The primary use of cash in net assets was the increase of $134.5 million in accounts receivable due to seasonally higher sales in the first three months of 2026. Also driving the use of cash was the increase of $27.3 million in inventories, as inventory levels were replenished for the upcoming selling season, partially offset by an increase in accounts payable, trade.

Previous wording

Depreciation and amortization was $90.4 million in the first nine months of 2025, and is expected to be approximately $115 to $125 million for the full year 2025. Non-cash stock-based compensation expense in the first nine months of 2025 was $16.9 million. Non-cash stock-based compensation expense is expected to be approximately $21 to $24 million for the full year 2025.

Current wording

Depreciation and amortization was $29.8 million in the first three months of 2026, and is expected to be approximately $115 to $125 million for the full year 2026. Non-cash stock-based compensation expense in the first three months of 2026 was $5.3 million. Non-cash stock-based compensation expense is expected to be approximately $24 to $27 million for the full year 2026.

Previous wording

Cash flows used in investing activities of $121.6 million in the first nine months of 2025 were primarily comprised of $103.0 million for the acquisitions of businesses and $38.1 million for capital expenditures, partially offset by proceeds from the sale of real estate of $22.7 million. Cash flows used in investing activities of $50.6 million in the first nine months of 2024 were primarily comprised of $31.4 million for capital expenditures and $20.0 million for the acquisition of a business.

Current wording

Cash flows used in investing activities of $9.6 million in the first three months of 2026 were primarily comprised of $9.7 million for capital expenditures. Cash flows used in investing activities of $42.0 million in the first three months of 2025 were primarily comprised of $29.6 million for the acquisition of a business and $9.0 million for capital expenditures.

Previous wording

Our capital expenditures are primarily for replacement and growth. Over the long term, based on our historical capital expenditures, the replacement portion has averaged approximately one to two percent of net sales, while the growth portion has averaged approximately two to three percent of net sales. However, there are many factors that can impact the actual spending compared to these historical averages. We estimate full year 2025 capital expenditures of $45 to $55 million, including investments in automation and lean projects, which we expect to fund with cash flows from operations or periodic borrowings under the revolving credit facility.

Current wording

Our capital expenditures are primarily for replacement and growth. Over the long term, based on our historical capital expenditures, the replacement portion has averaged approximately one to two percent of net sales, while the growth portion has averaged approximately two to three percent of net sales. However, there are many factors that can impact the actual spending compared to these historical averages. We estimate full year 2026 capital expenditures of $55 to $75 million, including investments in automation and lean projects, which we expect to fund with cash flows from operations or periodic borrowings under the revolving credit facility.

Previous wording

Capital expenditures and acquisitions of businesses in the first nine months of 2025 were funded by cash on hand and borrowings under our revolving credit facility. Capital expenditures and any acquisitions in the remainder of fiscal year 2025 are expected to be funded primarily from cash generated from operations, as well as periodic borrowings under our revolving credit facility.

Current wording

Capital expenditures in the first three months of 2026 were funded by cash on hand. Capital expenditures and any acquisitions in the remainder of fiscal year 2026 are expected to be funded primarily from cash generated from operations, as well as periodic borrowings under our revolving credit facility.