October '20

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24 • RV PRO • October 2020 rv-pro.com Editor's note: This article is the second in a three-part series looking at how mergers and acquisitions are reshaping the RV industry. This article looks at the RV supplier segment. Part III of the series, looking at acquisitions of OEMs, will appear in the November issue. Part I of the series, looking at dealer M&A activity, ran in the September issue. L ippert Components Inc. (LCI) has emerged as one of the more bullish suppliers in the RV and marine sec- tors when it comes to acquisitions. "Near-term, we will be prudent from a capital allocation perspective, focusing on realizing new synergies from our most recent acquisitions, preserving cash and paying down debt to maintain our strong balance sheet," company CEO M&A IN THE RV INDUSTRY LCI Accelerates Supplier M&A Activity By Steve Bibler and Bradley Worrell RV O E F O C U S Jason Lippert has helmed Lippert Components since 2013, during which time the company has made a number of strategic acquisitions within the RV industry and in adjacent industries. According to the company, LCI historically uses 40 percent of its cash for acquisitions. Lippert Components got its start in Elkhart and continues to have a strong presence in the RV capital. In the RV segment, the company saw its content per travel travel/ fifth wheel rise to $3,371, for the 12 months that ended June 30, 2020. and President Jason Lippert tells RV PRO. "That said, we haven't let up on evaluating M&A transactions. Based on our successful acquisitions in the wake of 9/11 and the Great Recession, we expect that there will be ample opportunities to leverage, ensuring that we come out the other side of this crisis stronger." Diversification Leads LCI Q2 Highlights In the company's second-quarter report issued on Aug. 4, Jason Lippert acknowl- edged the difficult operating environment caused by COVID-19 and the resulting shutdown of its customers' factories. How- ever, he was able to point to several positive developments as well, including: • Aftermarket sales grew to $158 million, representing a whopping 109 percent year-over-year increase. • International sales grew to $44.1 million, representing an increase of 40 percent year-over-year. • In the RV segment, content per travel trailer/ fifth wheel (adjusted to remove Furrion sales from prior periods), increased by $141 per unit, or 4 percent, to $3,371, for the 12 months that ended June 30, 2020. In prepared comments accompanying the second-quarter results, Jason Lippert Lippert Components relies on acquisitions to enter adjacent markets, to add to its product offerings and to grow its bottom line.

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