PATRICK INDUSTRIES INC — Call Transcript 2025

Good morning ladies and gentlemen and welcome to Patrick Industries Third Quarter 2025 Earnings Conference Call. My name is Rob and I'll be your operator for today's call. At this time all participants are in 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 this conference is being recorded and I'll 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. Andy Nemeth, CEO, Jeff Rodino, President, and Andy Roeder, CFO. Certain statements made in today's conference call. Regarding Patrick Industries and its operations, may. Be considered forward-looking statements. Under the securities laws, the Company undertakes. No obligation to publicly update any forward. Looking statement whether as a result of new information, future events, or otherwise. Additional factors that could cause results to differ materially from those described in the. Forward-looking statements can be found in the company's annual report on Form 10-K. For the year ended December 31, 2024. The company's other filings with the Securities and Exchange Commission. I would now like to turn the. Call over to Andy Nemeth. Thank you, Steve. Good morning everyone. We appreciate you joining us on the call. Today we delivered solid third quarter performance, demonstrating the resilience of our business in a dynamic and unique environment. Net sales for the quarter increased 6% to $976 million, with organic growth contributing more than 4% and offsetting an almost 2% decline in our industry shipment levels. Earnings per diluted share was $1.01, including approximately $0.07 of dilution from our convertible notes and related warrants. On a trailing 12-month basis, net sales were approximately $3.9 billion. Our results reflect both the strength of our diversified business model and solid organic growth as a result of our team's innovation and advanced product efforts and their incredible execution. As we continue to navigate dynamic demand levels across our end markets and challenges facing the broader economy, our OEM and dealer partners continue to exhibit disciplined production, leaving inventory even leaner across all of our outdoor enthusiast markets and positioning us positively for a potential restock when retail inflects. We remain well equipped to capture meaningful upside when that inflection occurs, both strategically and organically. We ended the quarter with a strong balance sheet and total net liquidity of $779 million. Our financial position enables us to remain flexible and nimble in supporting our customers' growth needs with a variety of levers while continuing to execute a balanced capital allocation strategy. We expect to continue our investments in the aftermarket and new product development, both through heavy emphasis on model year prototyping and in combination with our Advanced Product Group, which is focused on product development several model years out. Additionally, and importantly, we are continuing to invest in digital tools, data analytics, and AI-powered solutions across our business to drive greater efficiency, accelerate decision making, reduce costs, and unlock new value for our customers. We continue to be proactive in strengthening the Patrick platform through strategic initiatives like the acquisitions of LiliPad Marine, Medallion Instrumentation Systems, and Elkhart Composites, as well as the modernization of our processes, technology, and equipment, and optimizing our aftermarket resources to create new opportunities for our brands. These investments are expected to continue to contribute to our share gains across our end markets. Building on strong revenue execution across our primary end markets, we continue to make meaningful progress in expanding our content per unit or CPU through a combination of innovation, collaboration, and targeted investment. Our teams are working closely with OEM partners to integrate new products and technologies that elevate the functionality, design, and consumer appeal of products like RVs, boats, and side by sides. In the third quarter, we achieved content gains across all of our outdoor enthusiast markets and our MH market, reflecting both our expanding product portfolio and the growing adoption of our integrated full solutions platforms. These content gains underscore the power of our diversified model and validate the continued demand for Patrick's high valued, individualized, and differentiated solutions that enhance performance, efficiency, and aesthetics across every category we serve. Subsequent to quarter end, our Marine brands had a successful and prominent showing at IBEX. The Marine industry suppliers show our increased presence unveiled the scale of Patrick's platform while reinforcing our commitment to a brand forward approach and showcasing our innovative product lineup, fully demonstrating the depth and breadth of Patrick's solutions. At the show, guests had the opportunity to explore our Full Solutions Experience Boat, allowing them to engage with numerous Patrick's products including Medallion's touchscreen displays, Wet Sounds speakers, BHE harnesses and wiring, LiliPad Marine ladders, SeaDek flooring and lighted cup holders, XT carbon tops, and TACO seating. I also want to congratulate the team at TACO on their IBEX Innovation Award for their Altura Luxury Helm seat, a new flagship helm chair with a patented stainless steel frame concealed inside a teak ladderback. Additionally, I am proud to share that our former President of Marine, Rick Reyenger, was inducted to the NMMA Hall of Fame. With more than 40 years of leadership in the recreational boating industry, Rick has influenced many generations of colleagues and competitors alike. Finally, I want to again recognize the remarkable efforts of the Patrick team. Their commitment, adaptability, and focus on serving our customers has been extraordinary during these dynamic times and continues to drive a brand fronted partnership model with our customers. Beyond cyclical dynamics, we expect to drive continued strategic growth through M&A, aftermarket expansion, innovative product development, and our diversified portfolio. Our solid balance sheet and solutions-driven strategy keep us well positioned for sustainable long-term profitable growth. I'll now turn the call over to Jeff, who will highlight the quarter and provide more detail on our end markets. Thanks Andy and good morning everyone. Looking closer at our end markets, third quarter RV revenue increased 7% to $426 million versus the same period in 2024, representing 44% of consolidated revenue. Our RV content per unit on a TTM basis was $5,055, an increase of 3% from the same period last year. On a quarterly basis, CPU increased 8% sequentially compared to the second quarter of 2025 and increased 9% year-over-year. The improvement in the revenue and CPU in the third quarter was driven by our commitment to working with and supporting our customers with model year innovations as they refine and upgrade their products. Coupled with recent acquisitions, we estimate RV retail unit shipments were approximately 100,100 and according to RVIA, wholesale unit shipments were approximately 76,500 in the third quarter. This implies a seasonal dealer inventory destock of approximately 23,600 units during the period, resulting in an estimated dealer inventory weeks on hand of approximately 14-16 weeks. This is down from 19-21 weeks in the second quarter of 2025 and reflecting continued OEM wholesale production discipline. This remains well below pre-pandemic historical averages of 26-30 weeks and we further believe the number of discrete units in the field is well below levels seen during the pre-pandemic period. Over the last year we've revealed a long term strategy related to composite solutions. This highlights our efforts to seize emerging market opportunities through both acquisition and innovation. After several years of early stage development and prototyping, we recently unified our composite solutions under the Alpha Composites brand name. Alpha Systems is a Patrick brand that is synonymous with high level customer service providing innovative solutions to RV and MH industries. The team at Alpha Composites will continue to build on the foundation through continued collaboration with our OEM partners. We believe our unified branding approach and dedicated resources will further enhance our competitive position as a leading composite solution provider and innovator in a market where weight, durability, overall cost and sustainability matters to our customers. Our third quarter Marine revenues increased 11% to $150 million, outperforming what we estimate were flat wholesale powerboat unit shipments. Our estimated Marine content per wholesale powerboat unit on a TTM basis was $4,091, an increase of 4% from the same period last year. Estimated content per unit on a quarterly basis was up 15% sequentially compared to the second quarter of 2025 and increased 10% year-over-year. We estimate Marine retail and wholesale powerboat unit shipments were 42,700 and 32,300 units respectively in the third quarter, implying a seasonal dealer field inventory destock of approximately 10,400 units. Dealer inventory in the field remains lean at an estimated 16-18 weeks on hand, down from 20-22 weeks in the second quarter of 2025 and 19-21 weeks on hand last year at this time, remaining well below historical pre-pandemic averages of 36-40 weeks. Like RV, we believe the discrete number of units in the field remains well below pre-pandemic levels. Our broad Marine portfolio and design expertise position us as a key partner to new entrants and our existing base of valued customers alike. New entrants in the pontoon space have begun to leverage the breadth of our offerings and customer services early in their processes. Additionally, related to Andy's mention regarding IBEX, we've identified opportunities in the Marine market related to composites and are now offering a full composite deck solution including composite flooring, woven fabric, and the adhesive that brings it all together, enhancing the strength, sustainability, and ease of installation for our customers. During the quarter, we completed the acquisition of LiliPad Marine, a Traverse City, Michigan-based designer and seller of premium innovative boat ladders, diving board systems, and other Marine accessories. LiliPad delivers their award-winning and patented products through both OEM and aftermarket channels, deepening our lineup of innovative solutions in the Marine space. Our Powersports revenue increased 12% to $98 million in the quarter versus the prior year period, representing 10% of third quarter 2025 consolidated sales. Our revenues improved across all Powersports businesses, including those that serve recreation and audio markets. Coupled with continued growth in attachment rates for Sportech's products entering the fourth quarter, we believe the OEMs and dealers will continue to carefully monitor and manage inventory in the channel despite some positive retail signals in recent months. Recently, our Rockford Fosgate brand launched a new 2024+ HD aftermarket solution at Sturgis. This kit includes Rockford's first aftermarket motorcycle amplifier with a built-in A2B digital interface. Not only is this a Rockford first, it is an industry first. This digital amplifier pairs with Rockford's newly launched speakers to create a premium plug and play solution for newer Harley motorcycles. Finally, on Powersports, as we have discussed on a number of calls, the utility segment of the Powersports market has shown much better resilience than the recreation market, leading to improving attachment rates with existing customers. We have begun to see an increasing interest in adding HVAC and other creature comforts from some of the traditional legacy Powersports OEMs, which should lead to a broader base of demand for enclosures which Sportech provides. On the Housing side of the business, our third quarter revenues were up 1% to $302 million, representing 31% of consolidated sales in Manufactured Housing, which represented approximately 58% of our Housing revenue in the quarter. Our estimated content per unit on a TTM basis increased 2% year-over-year to $6,682. We estimate MH wholesale unit shipments and total Housing starts both decreased 2% in the quarter, as evidenced by our solid Manufactured Housing content per unit performance. In the face of lower industry wholesale unit shipments, our team continues to perform with strong customer relationships and our ability to align and scale quickly to demand while maintaining a lean fixed cost structure. Despite recent softness in MH shipments, we continue to believe there is a lack of affordable Housing options in the U.S., and we believe our solutions can help both MH and site-built Housing industries provide quality, cost-effective homes efficiently. We believe lower interest rates and improved customer confidence remain pivotal to unlocking pent-up demand. I'll now turn the call over to Andy Roeder, who will provide additional comments on our financial performance. Thanks Jeff and good morning everyone. Consolidated net sales for the quarter increased 6% to $976 million. Our team drove increased revenues in both our Outdoor Enthusiasts and Housing end markets, including a 7% increase in RV revenues, an 11% increase in Marine revenues, a 12% increase in Powersports revenues, and a 1% increase in Housing revenues. As Jeff noted, we generated solid content gains across our end markets during the quarter. Our total revenue growth of 6% was comprised of 4% acquisition growth, 4% organic growth, and -2%. Industry gross margin was 22.6% versus 23.1% in the third quarter of last year. The decline reflected items including short-term inefficiencies related to the model year changeover. Operating margin was 6.8% compared to the prior year at 8.1%. This change was driven by the previously described factors. Our overall effective tax rate was 26.2% for the third quarter compared to 24.8% in the prior year. Net income was $35 million or $1.01 per diluted share compared to net income of $41 million in the prior year quarter. Our diluted EPS for the third quarter of 2025 included approximately $0.07 in additional accounting-related dilution as a result of the increase in our stock price above the convertible option strike price for our 2028 convertible notes and related warrants. The prior year's diluted EPS included just $0.04 per share. Adjusted EBITDA was $112 million compared to $121 million, while adjusted EBITDA margin was 11.5%, lower by 170 basis points from the third quarter of 2024. Cash provided by operations for the first 9 months of 2025 was $199 million compared to $224 million in the prior year period. Purchases of property, plant, and equipment were $26 million in the quarter and $65 million year-to-date. This implies free cash flow of approximately $134 million for the first 9 months of 2025. Total net liquidity at the end of the third quarter was $779 million, comprised of $21 million of cash on hand and unused capacity on a revolving credit facility of $758 million. As a reminder, we have no major debt maturities until 2028 and continue to have the financial strength and capital necessary to capture long-term organic and inorganic growth opportunities. At the end of the third quarter, our net leverage was 2.8x. We returned approximately $13 million to shareholders through quarterly dividends regarding our share buyback. We remain opportunistic, having repurchased approximately 377,600 shares year-to-date through the third quarter for a total of $32 million, leaving approximately $168 million left on our repurchase authorization. Regarding tariffs, our strategy remains unchanged, and our teams are actively working with supply chain partners to minimize the potential impact. This remains a dynamic landscape, and we will continue to utilize all of our tools that we believe will help neutralize the absolute impact to our pricing pass throughs and ultimately mitigate any material impact to our operating margin. I'll now move to our outlook. We estimate RV retail unit shipments will be down low single digits in 2025, with estimated full year RV industry wholesale unit shipments between the range of 335,000-345,000 units and continue to anchor on equivalent dealer inventory weeks on hand year-over-year. In Marine, we estimate retail shipments will be down high single digits and estimate wholesale shipments will decline low single digits, again with dealer inventory weeks on hand year-over-year remaining approximately the same. In our Powersports end market, we now estimate that wholesale industry shipments will be down high single digits, and our organic content will be up high single digits, offsetting the industry decline as our content continues to grow given ongoing increasing attachment rates for our cab enclosures. In our Housing market, we estimate MH wholesale unit shipments will be up low to mid single digits for 2025. On the residential Housing side of the market, we estimate 2025 total new site-built Housing starts will be down mid to high single digits year-over-year. Moving to our financial outlook, we expect our full year 2025 adjusted operating margin to be approximately 7%. We continue to estimate that our effective tax rate will be approximately 24%-25% for 2025, implying a quarterly effective tax rate of approximately 26%. For the fourth quarter, we estimate operating cash flow will be between $330 million-$350 million, and we estimate capital expenditures will total $75 million-$85 million. As we continue to reinvest in the business, focusing on automation and innovation initiatives, this implies free cash flow of at least $245 million. For modeling purposes, we'd like to give our initial thoughts regarding 2026. Based on where we sit today, we expect RV wholesale shipments to increase low to mid single digits and RV retail to be flat. For Marine, we expect wholesale shipments to be up low single digits and retail to be flat. In Powersports, we expect low single digit shipment growth and low single digit organic content growth. For MH and Housing starts, we expect both to be flat to up 5%. We believe improved consumer confidence and lower interest rates are key factors necessary for our end markets to rebound more aggressively. Based on these estimates, we expect our operating margin in 2026 to improve meaningfully, an estimated 70-90 basis points. That completes my remarks. We are now ready for questions. Thank you. We'll now be conducting a question-and-answer session. If you'd like to ask a question today, you may press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to withdraw your question from the queue. For participants that are using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. To allow as many questions as possible, we ask you please limit yourself to one question and one follow-up. Thank you. Our first question comes from the line of Scott Stember with ROTH Capital. Please proceed with your questions. Good morning, guys, and thanks for taking my questions. Morning. A lot has been made of some of the increased optimism coming out of Open House. What are you currently seeing from your OEM customers regarding production? What are they telegraphing as far as, you know, their desire to start ramping up production to potentially put more units into the field? Yes. Scott, this is Jeff. As I look at our production numbers or production numbers from the OEMs, we are seeing, we saw a little bit of a slight increase in October. We're seeing a little bit more of an increase in November. We do feel like just the pure production numbers would tell us that there is some ramping up, you know, to what degree that'll, you know, be consistent through, you know, into the first quarter. Right now we're seeing a little of that. As I look forward, after this week, we really only have 6 more weeks of production in 2025 with a week off for Thanksgiving. There is some production in Thanksgiving and then we'll take 2 weeks off for Christmas. I think early indications are if I look year-over-year, we're seeing some increases in the back half of the fourth quarter. Got it. Moving over to the aftermarket. I know you guys have been doing a lot of cross pollination with RecPro. Can you give us an update of, you know, new SKUs or just, is that accelerating? Just give us an idea of what's going on. Yes. Scott, this is Jeff again on the RecPro side. We've had several hundred SKUs that have carried over from other Patrick divisions into RecPro this year. So far we'll be close to 400 or 500. When it's all said and done since the inception of the acquisition, we are looking to accelerate that a little bit. We've really got them entrenched with our Marine side now and all of our Marine divisions to really start to grow that portfolio within the RecPro site. Really excited we put a little bit more capacity in that area to help accelerate that. We're excited about what we've seen so far and what we're going to see looking forward. One of the other things, Scott, this is Andy, is that we just formally launched our aftermarket strategy, which includes a combination of not only direct to consumer, but direct to dealer and third party distribution. We've rolled out a formal strategy. We're implementing structure to really kind of formally launch an overall vision for where we want to take the aftermarket in alignment with our RecPro platform on the direct to consumer side. We're looking forward to really driving some real value in the aftermarket. Got it. Just a little bit more granularity on your comments about the 70-90 basis points of operating margin expansion next year. I assume there will be some sales growth. Just trying to get a sense of how much is sales leverage, how much is internal self help, like things that you have going on like automation and AI, things like that. Just trying to flesh that out. Sure. Scott, this is Andy. A lot of it's going to be sales leverage. I would also tell you content gains, the solutions that we're putting together for customers, allowing them to reduce cost overall, but allowing us with more product content with our customers is going to add value there. I think as it relates to the automation efforts, we're going to continue to push forward aggressively on automation amongst our facilities and continue to invest in CapEx. We're definitely picking up nickels and dimes along the way as it relates to the automation efforts that we expect to see. A combination of all of those across the platform drives that margin improvement, and certainly volume plays heavily in there, especially if we go above and beyond kind of our industry expectations. We expect to be able to really leverage our fixed cost structure today. We don't need to add a lot of overhead to support significant incremental volumes. Gotcha. That's all I have. Thank you. Thanks. Our next questions come from the line of Joe Altobello with Raymond James. Please proceed through your questions. Thanks. Hey guys, good morning. I guess just to follow up on that operating margin commentary, obviously the outlook for 2026 is encouraging, but it sounds. Like you're looking for operating margin, this. Year toward the lower end of your prior range. What is kind of weighing on margin this year ahead of the 2026 improvement? Joe, here in the third quarter we really experienced some model change in efficiency. If you look back through the first couple quarters, we've seen gross margin expansion driven primarily by the addition of our direct to consumer aftermarket business RecPro last fall. Along with that came a heavier OpEx profile. This quarter our OpEx is in line, but we just had some, I'll call them one timers, short term investments. We brought on significant new business here in the quarter. CPU was up 9% and 10% for RV and Marine. Significant new business came with that, and with that just come some material and labor inefficiencies. Got it. Okay. In terms of what you're seeing so far in terms. Of production and shipments in October. November, I think it was in the. Last call, you guys thought that we. Might see some sort of restock either. In the fourth quarter or maybe the first quarter of next year, are you starting to see that potential restock, or is this just kind of. Noise at the end of a year? I think there might be a little bit of potential restock. I mean, we're getting ready to get into the selling season. You know, you got Tampa right around the corner at the beginning of January. I think if you noted during the prepared remarks, 14-16 weeks on hand is extremely low. I mean, that's really the lowest we've seen since the pandemic where it was in the high single digits of weeks on hand back then. There's a lot of room there. The end of 2025, we're at about 17-19 weeks on hand. There's got to be a little bit of restock in there to be able to get the right units on the lots and be prepared for the selling season that's going to come in the first quarter. Got it. Okay, thank you, guys. Our next questions are from the line of Noah Zatzkin with KeyBanc Capital Markets. Please proceed with your questions. Hi, thanks for taking my question. I guess first, maybe if you could. Expand upon how you're thinking about CPU opportunity in 2026. Within that, you talked. Quite a bit about composites, so just. Would love to hear some more thoughts on how that kind of plays into CPU opportunity. Thanks. This is Jeff. In 2026, we expect all of our businesses, as we always do, to pick up anywhere between 3% and 5% organic growth. Our expectation is Composites is going to be a big part of that. I would tell you, if we look right now where we sit today, we believe the total addressable market in that composite area is about $1.5 billion. If you net out some of the cannibalization that may happen, it's close to $1 billion. Our teams are poised and ready to attack that piece of the market. I think with some of the other things going on in the market, that opportunity continues to be very strong. Again, our APG groups are coming up with new product development both on the Marine, RV, and Powersports side. We believe that the further, I guess, increased attachment rate on the Powersports side is going to give a lot of opportunity to Sportech as more and more OEMs are looking to go to that full attachment. I think across all of our markets we have a lot of opportunity to grow that CPU and continue to grow the business. Really helpful. Maybe just one more, maybe an. Update on just M&A. What you're seeing out there and kind. Of how you're thinking about that. Thanks. Sure. Noah, this is Andy. On the M&A front, we've been really active in the last quarter for sure as it relates to cultivating the acquisition pipeline. We've got candidates identified really across our markets, and we've been out actively talking, building that pipeline up. We're starting to see more deal flow come at us from outside sources as well. Both the organic side of it, we're working with potential targets, as well as the deal feed coming in from investment bankers, has increased over the last probably 30-45 days in particular. We're seeing increased activity on the M&A front. Thank you. Our next questions are from the line of Daniel Moore with CJS Securities. Please proceed with your questions. Thank you. Good morning. I appreciate all the color. Obviously appreciate the color about dealers weeks. On hand both in RV and Marine as you talk to OEMs and dealers. We have this sort of historic. Backdrop of what averages look like pre-pandemic. Do you have a sense for or? Guess for what a new normal could be. Look like in terms of weeks on. Hand in those key end markets? You know, when we get back to. Say low to mid single digit retail growth cadence. Dan, this is Andy. If we look at historical numbers, pre-pandemic, RV weeks on hand was roughly 26-30 weeks and Marine weeks on hand was roughly 36-40 weeks pre-pandemic. If you look at where we're kind of sitting today, RV at 14-16 weeks and finishing out last year at roughly, let's just call it 18 weeks, we definitely think there's some restock needed. We absolutely feel that the inventories in the channel today across the spectrum are low and that there is a restock needed even in the current environment. We feel like there's some restocking needed. We don't expect to see the historical pre-pandemic levels, 26-30 weeks on RV and again, 36-40 weeks on Marine. That being said, we definitely know it's bigger than where we're at today. Marine today, as Jeff mentioned, 16-18 weeks on hand last year. At the end of the year, we were at 22 weeks. We feel like there's some restock coming and needed. We do feel like inventories are low, but we do think, you know, I'm going to say, you know, let's just say 22-24 weeks is probably a good range to kind of think about right now, at least in our estimation. We also know that dealers have gotten really good at working with less inventory. That being said, we also do feel across our spectrum, and we have multiple touches with the dealer network, whether it's our transportation business or whether it's our touches with the OEMs or dealers themselves. We get a feel that inventories are lean and that dealers will need some more balance out there. We do feel like there's some, again, restock needed. Really helpful. Switching gears, initial guidance for 2026 implies operating margin getting back close to 8%. As you look across the businesses and when demand starts to return, where do you. You see the most significant capacity and. Strongest kind of incremental margins and opportunity. For further expansion beyond that across the various businesses? Sure. Given what we've done with our business, our team's discipline and really managing their businesses, some of the consolidations that we've done, as well, just really maintaining a lean operating structure and continuous improvement environment, there is leverage ability across all of our pillars and all of our business segments. Incrementally there's a few puts and takes, but overall, I tell you, there's significant incremental opportunity for us to leverage the business in each of our markets. Got it. If you did and I missed it, forgive me. Can you maybe quantify in ballpark terms the. Impact of inefficiencies related to the model. Year changeover this quarter? Yeah, Dan. I mean, we saw in the first two quarters our gross margin expand by, you know, near 100 basis points. There's some noise in there, you know, with tariff impacts and timing, but for the most part, you know, I think that's. We expect a meaningful gross margin expansion driven by our RecPro direct to consumer margins in that acquisition last fall. You know, we were down 50 basis points. I guess I'd expect us to be up, you know, 50 basis points that ballpark as we look forward. Got it. Helpful. Thank you. Appreciate it. Andy. The next question is from the line of Tristan Thomas-Martin with BMO Capital Markets. Please proceed with your question. Hey, good morning. Do you have any kind of thoughts? Have you seen any of the consumer kind of changes based on modeling or pricing being up, call it. Mid to high single digits. Can you repeat that question? Sorry, just asking. With model year 2026 pricing up mid to high single digits, kind of like. How are you seeing consumers and dealers react to that? Yeah, this is Jeff. I think they've certainly passed that along into the channel as we could tell. We did see some increased retail year-over-year in June and July. That came down a little bit in August. Overall, we can only tell you where the production numbers are telling us right now since we haven't really seen retail for September and October. Once we see those, we'll get a better feel overall of the retail demand. From what we can tell from production levels and where we think wholesale shipments are going, there's still demand out there and we feel good that they've been able to absorb that into the pricing. We have seen a little bit of interest rate help, which certainly will help mitigate some of the pricing that's happened. Overall, we feel good about kind of where the pricing's ended up. As far as what tariff noise had been out there earlier in the year, we've got a few more countries they need to sort some things out with. As we look, we've been working very closely with customers. We know that affordability is a big concern and partnering with our customers to help with that affordability is something that we've been very active in over the last quarter. Okay. It's kind of the obvious follow-up. How's the production mix been looking in terms of like are we seeing. Maybe a little chip towards fifth wheels. Away from single axle? Yeah, we've seen a little of that. I mean, it certainly does occur a lot of times in the fall where we'll see a little bit more on the fifth wheel side as you get the full-time RVers, they're going to use it for the full winter. Getting into a fifth wheel versus the smaller entry level, certainly the mix is not back to what I would call a normal mix that we've seen in the past with fifth wheel and travel trailer and the smaller travel trailers, but we have seen a little bit of a shift in the third quarter. We expect that that'll stay for the fourth if we get into the first part of next year. I think the dealers were so kind of keen on the entry level product for most of 2025. As we see that they need to refill some of the stock that's out there, I think we're going to see that's going to be in some of the mid to higher end product. We feel good about where the mix is at. I don't think it'll go backwards into the more small travel trailers, but we're keeping an active look at that. Okay, got it. Just squeeze one more. Is there any way to think about the composite $1 billion addressable market opportunity, kind of how that breaks out across your end markets? Thanks. Yeah, it's primarily in the RV market right now. When you look at the roofing and flooring solutions that we're providing, we're really not into that business right now with roofing, flooring, and slide outs. The interior and exterior skins are something that we're participating in right now. We're very active in shifting from some of the wood products that we're currently selling into composites. We feel really good about all the prototyping that we've done and the activity and the products we've been able to bring to market. Certainly, we see some opportunity on the Marine side. It's pretty fresh on the Marine side. We've done a lot on the wood products within Marine, and now we're starting to shift over into some of the composites. I would tell you that the majority of what we talked about in the addressable market is going to come on the RV side to start with. Thank you. The next question is from the line of Craig Kennison with Baird. Please proceed with your questions. Hey, thanks for taking my question. Apologies for joining a little late. Wanted to ask about slide 15. Talking about Powersports organic content growth up low single digit. What is driving that? Hey, Craig. Without question, content gains that we've seen as it relates to attachment rates for our enclosures in particular, we've seen as we've talked about kind of the utility side of the business, which is really where we've got tremendous focus, being more resilient than the rec side of it. That being said, the overall take rate continues to go up on enclosures and continued take rate on HVAC systems, which in the side-by-side markets continues to go up. We're seeing that, we're seeing some new entrants come into the market in 2026, as well as some of the product innovations that we've had teed up over the last couple of years are expected to continue to drive content as well. We're excited about not only the uptake rate but some of the solutions we're bringing and the opportunity for us to really exhibit our full solutions model as well into the Powersports market. Not only an enclosure, for example, but also a sound system, a wiring harness, a dash panel, instrumentation system all combined into one solution for our customers going forward. A tremendous opportunity for us to continue to realize additional content gains in the side-by-side market. Thanks, Andy. Maybe just to follow up on the RecPro topic, how do. You manage any sort of channel conflict. That might come about. Setting up a direct-to-consumer platform? Yeah, Craig, this is Jeff. I don't see a lot of channel conflict in what we're doing. Prior to having RecPro on board, which gives us that direct to consumer avenue for our products, we had very little aftermarket touch points. If you look at the content that Patrick Industries is putting into RVs and Marine and then not really having an outlet to be able to get that product into the hands of the end consumer, this is really just giving us that avenue. I don't see a lot of conflict there. Thank you, Jeff. Maybe finally on the MH side, what will it take to see. A more sustained recovery? It feels like there's ample need for affordable Housing and we're going to get interest rates moving in our favor. What are your industry context suggesting is necessary for that really to take off? Sure. Craig, this is Andy, it's a good question. I think as we look at the MH side of the business, we certainly continue to believe, you know, in the model that it provides the low cost alternative, especially for first time entrance into the Housing market. Historically, MH has run 9%-11% of single family Housing starts. If you go back in history and we continue to see that, you know, trend continue, you know, as far as I'm concerned, as we continue to watch that, you know, we're going to continue to look for an inflection point where we see that trend change a little bit, we see a greater percentage of single family housing starts is our indicator. Overall, the model, the narrative, you know, makes a lot of sense especially with where things are at. We just think some of the pent up demand needs to be released into that market, but we're fully supportive of it. As well, the quality of the homes have gotten so much better over the years. It really is an attractive solution as well, waiting for kind of that inflection point. Thanks, Andy. Yep. As a reminder, if you'd like to ask a question today, you may press star one from your telephone keypad. Our next question comes from the line of Mike Albanese with Benchmark. Please proceed with your questions. Yeah. Hey, good morning, guys. Thanks for taking my question. I just want to touch on, you know. Craig had asked a question about the Powersports segment. As we think about it. Attachment rates and products like HVAC. Is it possible to kind of frame, you know, maybe from. From an industry standpoint, what percentage of the overall utility industry comes with enclosures? Let me think about that for a minute, Mike. The percentage of the industry, probably. Today, utility side by side, like how, how, you know. How many utility vehicles are coming with enclosures? I mean, probably 60%, 70%. Okay. It's a guess. I can't tell you exactly. It is definitely going to be heavier on the utility side versus the side by side, Mike. Correct. We're dealing primarily with a couple of the large manufacturers. There are some of the manufacturers out there that aren't even offering that yet, but we believe that's a big tailwind for us when they start to go into that market. Within our customers, it's that 60%, like Andy was talking about, but the overall market, I think there's opportunity beyond that. Yeah, that's exactly where I was going with the question. Just to get a sense of, you know, as enclosures proliferate. With that comes more opportunities to drive new product and increase attachment rates, right. I was trying to get a sense of, you know. Not only that, Mike, but the frame. Not only. Some come with a frame, right? Some come with a windshield. The attachment to add doors, to add windows, then the additional content that we've talked about on top of that from a solution perspective, kind of all play into that. Got it. Thanks. Thank you. Thank you, ladies and gentlemen. I'll turn it back to Andy Nemeth for closing remarks. Thank you. Once again, I just really want to acknowledge and thank our incredible team for just their continued efforts, dedication, passion, for really partnering with our customers, bringing new products to market, managing the tariff situation, and continuing to deliver consistent and predictable results. I'm just so proud of the team and all their efforts, and as well want to thank our customers for their tremendous support through these incredibly dynamic times. As we continue to really work to partner, to make sure we're promoting the industry as a whole in alignment with their goals and objectives, I really appreciate all the efforts of the team. We will continue to push forward. I think there's a ton of opportunity for Patrick as we look at where the industries are teed up and where they can go. Not only that, the resilience and scalability of our model and the ability to inflect when our customers need it, I'm really excited about. Once again, thank you very much for joining us. We look forward to talking to you after our fourth quarter results. Thank you. Ladies and gentlemen, this concludes today's teleconference. Thank you for your participation. You may now disconnect.

Speaker 8: Good morning ladies and gentlemen and welcome to Patrick Industries Third Quarter 2025 Earnings Conference Call. My name is Rob and I'll be your operator for today's call. At this time all participants are in 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 this conference is being recorded and I'll now turn the call over to Mr. Steve O'Hara, Vice President of Investor Relations. Mr. O'Hara, you may begin. Good morning ladies and gentlemen and welcome to Patrick Industries Third Quarter 2025 Earnings Conference Call. good morning ladies and gentlemen and welcome to patrick industries third quarter 2025 earnings conference call My name is Rob and I'll be your operator for today's call. At this time all participants are in listen only mode. my name is rob and i'll be your operator for today's call. at this time all participants are in listen only mode A question-and-answer session will follow the formal presentation. 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. if anyone should require operator assistance during the conference please press star zero on your telephone keypad Please note this conference is being recorded and I'll now turn the call over to Mr. Steve O'Hara, Vice President of Investor Relations. please note this conference is being recorded and i'll now turn the call over to mr steve o'hara vice president of investor relations Mr. O'Hara, you may begin. mr o'hara you may begin

Speaker 11: Good morning everyone, and welcome to our call this morning. Good morning everyone, and welcome to our call this morning. good morning everyone and welcome to our call this morning I'm joined on the call today by. I'm joined on the call today by. i'm joined on the call today by Andy Nemeth, CEO, Jeff Rodino, President, and Andy Roeder, CFO. Andy Nemeth, CEO, Jeff Rodino, President, and Andy Roeder, CFO. andy nemeth ceo jeff rodino president and andy roeder cfo Certain statements made in today's conference call. Certain statements made in today's conference call. certain statements made in today's conference call Regarding Patrick Industries and its operations, may. Regarding Patrick Industries and its operations, may. regarding patrick industries and its operations may Be considered forward-looking statements. Be considered forward-looking statements. be considered forward-looking statements Under the securities laws, the Company undertakes. Under the securities laws, the Company undertakes. under the securities laws the company undertakes No obligation to publicly update any forward. No obligation to publicly update any forward. no obligation to publicly update any forward Looking statement whether as a result of new information, future events, or otherwise. Looking statement whether as a result of new information, future events, or otherwise. looking statement whether as a result of new information future events or otherwise Additional factors that could cause results to differ materially from those described in the. Additional factors that could cause results to differ materially from those described in the. additional factors that could cause results to differ materially from those described in the Forward-looking statements can be found in the company's annual report on Form 10-K. Forward-looking statements can be found in the company's annual report on Form 10-K. forward-looking statements can be found in the company's annual report on form 10-k For the year ended December 31, 2024. For the year ended December 31, 2024. for the year ended december 31 2024 The company's other filings with the Securities and Exchange Commission. The company's other filings with the Securities and Exchange Commission. the company's other filings with the securities and exchange commission I would now like to turn the. I would now like to turn the. i would now like to turn the Call over to Andy Nemeth. Call over to Andy Nemeth. call over to andy nemeth

Speaker 1: Thank you, Steve. Good morning everyone. We appreciate you joining us on the call. Today we delivered solid third quarter performance, demonstrating the resilience of our business in a dynamic and unique environment. Net sales for the quarter increased 6% to $976 million, with organic growth contributing more than 4% and offsetting an almost 2% decline in our industry shipment levels. Earnings per diluted share was $1.01, including approximately $0.07 of dilution from our convertible notes and related warrants. On a trailing 12-month basis, net sales were approximately $3.9 billion. Our results reflect both the strength of our diversified business model and solid organic growth as a result of our team's innovation and advanced product efforts and their incredible execution. Thank you, Steve. thank you steve Good morning everyone. good morning everyone We appreciate you joining us on the call. we appreciate you joining us on the call Today we delivered solid third quarter performance, demonstrating the resilience of our business in a dynamic and unique environment. today we delivered solid third quarter performance demonstrating the resilience of our business in a dynamic and unique environment Net sales for the quarter increased 6% to $976 million, with organic growth contributing more than 4% and offsetting an almost 2% decline in our industry shipment levels. net sales for the quarter increased 6% to $976 million with organic growth contributing more than 4% and offsetting an almost 2% decline in our industry shipment levels Earnings per diluted share was $1.01, including approximately $0.07 of dilution from our convertible notes and related warrants. earnings per diluted share was $1.01 including approximately $0.07 of dilution from our convertible notes and related warrants On a trailing 12- month basis, net sales were approximately $3.9 billion. on a trailing 12- month basis net sales were approximately $3.9 billion Our results reflect both the strength of our diversified business model and solid organic growth as a result of our team's innovation and advanced product efforts and their incredible execution. our results reflect both the strength of our diversified business model and solid organic growth as a result of our team's innovation and advanced product efforts and their incredible execution As we continue to navigate dynamic demand levels across our end markets and challenges facing the broader economy, our OEM and dealer partners continue to exhibit disciplined production, leaving inventory even leaner across all of our outdoor enthusiast markets and positioning us positively for a potential restock when retail inflects. We remain well equipped to capture meaningful upside when that inflection occurs, both strategically and organically. We ended the quarter with a strong balance sheet and total net liquidity of $779 million. Our financial position enables us to remain flexible and nimble in supporting our customers' growth needs with a variety of levers while continuing to execute a balanced capital allocation strategy. As we continue to navigate dynamic demand levels across our end markets and challenges facing the broader economy, our OEM and dealer partners continue to exhibit disciplined production, leaving inventory even leaner across all of our outdoor enthusiast markets and positioning us positively for a potential restock when retail inflects. as we continue to navigate dynamic demand levels across our end markets and challenges facing the broader economy our oem and dealer partners continue to exhibit disciplined production leaving inventory even leaner across all of our outdoor enthusiast markets and positioning us positively for a potential restock when retail inflects We remain well equipped to capture meaningful upside when that inflection occurs, both strategically and organically. we remain well equipped to capture meaningful upside when that inflection occurs both strategically and organically We ended the quarter with a strong balance sheet and total net liquidity of $779 million. we ended the quarter with a strong balance sheet and total net liquidity of $779 million Our financial position enables us to remain flexible and nimble in supporting our customers' growth needs with a variety of levers while continuing to execute a balanced capital allocation strategy. our financial position enables us to remain flexible and nimble in supporting our customers' growth needs with a variety of levers while continuing to execute a balanced capital allocation strategy We expect to continue our investments in the aftermarket and new product development, both through heavy emphasis on model year prototyping and in combination with our Advanced Product Group, which is focused on product development several model years out. Additionally, and importantly, we are continuing to invest in digital tools, data analytics, and AI-powered solutions across our business to drive greater efficiency, accelerate decision making, reduce costs, and unlock new value for our customers. We continue to be proactive in strengthening the Patrick platform through strategic initiatives like the acquisitions of LiliPad Marine, Medallion Instrumentation Systems, and Elkhart Composites, as well as the modernization of our processes, technology, and equipment, and optimizing our aftermarket resources to create new opportunities for our brands. These investments are expected to continue to contribute to our share gains across our end markets. We expect to continue our investments in the aftermarket and new product development, both through heavy emphasis on model year prototyping and in combination with our Advanced Product Group, which is focused on product development several model years out. we expect to continue our investments in the aftermarket and new product development both through heavy emphasis on model year prototyping and in combination with our advanced product group which is focused on product development several model years out Additionally, and importantly, we are continuing to invest in digital tools, data analytics, and AI-powered solutions across our business to drive greater efficiency, accelerate decision making, reduce costs, and unlock new value for our customers. additionally and importantly we are continuing to invest in digital tools data analytics and ai-powered solutions across our business to drive greater efficiency accelerate decision making reduce costs and unlock new value for our customers We continue to be proactive in strengthening the Patrick platform through strategic initiatives like the acquisitions of LiliPad Marine, Medallion Instrumentation Systems, and Elkhart Composites, as well as the modernization of our processes, technology, and equipment, and optimizing our aftermarket resources to create new opportunities for our brands. we continue to be proactive in strengthening the patrick platform through strategic initiatives like the acquisitions of lilipad marine medallion instrumentation systems and elkhart composites as well as the modernization of our processes technology and equipment and optimizing our aftermarket resources to create new opportunities for our brands These investments are expected to continue to contribute to our share gains across our end markets. these investments are expected to continue to contribute to our share gains across our end markets Building on strong revenue execution across our primary end markets, we continue to make meaningful progress in expanding our content per unit or CPU through a combination of innovation, collaboration, and targeted investment. Our teams are working closely with OEM partners to integrate new products and technologies that elevate the functionality, design, and consumer appeal of products like RVs, boats, and side by sides. In the third quarter, we achieved content gains across all of our outdoor enthusiast markets and our MH market, reflecting both our expanding product portfolio and the growing adoption of our integrated full solutions platforms. These content gains underscore the power of our diversified model and validate the continued demand for Patrick's high valued, individualized, and differentiated solutions that enhance performance, efficiency, and aesthetics across every category we serve. Subsequent to quarter end, our Marine brands had a successful and prominent showing at IBEX. Building on strong revenue execution across our primary end markets, we continue to make meaningful progress in expanding our content per unit or CPU through a combination of innovation, collaboration, and targeted investment. building on strong revenue execution across our primary end markets we continue to make meaningful progress in expanding our content per unit or cpu through a combination of innovation collaboration and targeted investment Our teams are working closely with OEM partners to integrate new products and technologies that elevate the functionality, design, and consumer appeal of products like RVs, boats, and side by sides. our teams are working closely with oem partners to integrate new products and technologies that elevate the functionality design and consumer appeal of products like rvs boats and side by sides In the third quarter, we achieved content gains across all of our outdoor enthusiast markets and our MH market, reflecting both our expanding product portfolio and the growing adoption of our integrated full solutions platforms. in the third quarter we achieved content gains across all of our outdoor enthusiast markets and our mh market reflecting both our expanding product portfolio and the growing adoption of our integrated full solutions platforms These content gains underscore the power of our diversified model and validate the continued demand for Patrick' s high valued, individualized, and differentiated solutions that enhance performance, efficiency, and aesthetics across every category we serve. these content gains underscore the power of our diversified model and validate the continued demand for patrick' s high valued individualized and differentiated solutions that enhance performance efficiency and aesthetics across every category we serve Subsequent to quarter end, our Marine brands had a successful and prominent showing at IBEX. subsequent to quarter end our marine brands had a successful and prominent showing at ibex The Marine industry suppliers show our increased presence unveiled the scale of Patrick's platform while reinforcing our commitment to a brand forward approach and showcasing our innovative product lineup, fully demonstrating the depth and breadth of Patrick's solutions. At the show, guests had the opportunity to explore our Full Solutions Experience Boat, allowing them to engage with numerous Patrick's products including Medallion's touchscreen displays, Wet Sounds speakers, BHE harnesses and wiring, LiliPad Marine ladders, SeaDek flooring and lighted cup holders, XT carbon tops, and TACO seating. I also want to congratulate the team at TACO on their IBEX Innovation Award for their Altura Luxury Helm seat, a new flagship helm chair with a patented stainless steel frame concealed inside a teak ladderback. The Marine industry suppliers show our increased presence unveiled the scale of Patrick' s platform while reinforcing our commitment to a brand forward approach and showcasing our innovative product lineup, fully demonstrating the depth and breadth of Patrick 's solutions. the marine industry suppliers show our increased presence unveiled the scale of patrick' s platform while reinforcing our commitment to a brand forward approach and showcasing our innovative product lineup fully demonstrating the depth and breadth of patrick 's solutions At the show, guests had the opportunity to explore our Full Solutions Experience Boat, allowing them to engage with numerous Patrick's products including Medallion 's touchscreen displays, Wet Sounds speakers, BHE harnesses and wiring, LiliPad Marine ladders, SeaDek flooring and lighted cup holders, XT carbon tops, and TACO seating. at the show guests had the opportunity to explore our full solutions experience boat allowing them to engage with numerous patrick's products including medallion 's touchscreen displays wet sounds speakers bhe harnesses and wiring lilipad marine ladders seadek flooring and lighted cup holders xt carbon tops and taco seating I also want to congratulate the team at TACO on their IBEX Innovation Award for their Altura Luxury Helm seat, a new flagship helm chair with a patented stainless steel frame concealed inside a teak ladderback. i also want to congratulate the team at taco on their ibex innovation award for their altura luxury helm seat a new flagship helm chair with a patented stainless steel frame concealed inside a teak ladderback Additionally, I am proud to share that our former President of Marine, Rick Reyenger, was inducted to the NMMA Hall of Fame. With more than 40 years of leadership in the recreational boating industry, Rick has influenced many generations of colleagues and competitors alike. Finally, I want to again recognize the remarkable efforts of the Patrick team. Their commitment, adaptability, and focus on serving our customers has been extraordinary during these dynamic times and continues to drive a brand fronted partnership model with our customers. Beyond cyclical dynamics, we expect to drive continued strategic growth through M&A, aftermarket expansion, innovative product development, and our diversified portfolio. Our solid balance sheet and solutions-driven strategy keep us well positioned for sustainable long-term profitable growth. I'll now turn the call over to Jeff, who will highlight the quarter and provide more detail on our end markets. Additionally, I am proud to share that our former President of Marine, Rick Reyenger, was inducted to the NMMA Hall of Fame. additionally i am proud to share that our former president of marine rick reyenger was inducted to the nmma hall of fame With more than 40 years of leadership in the recreational boating industry, Rick has influenced many generations of colleagues and competitors alike. with more than 40 years of leadership in the recreational boating industry rick has influenced many generations of colleagues and competitors alike Finally, I want to again recognize the remarkable efforts of the Patrick team. finally i want to again recognize the remarkable efforts of the patrick team Their commitment, adaptability, and focus on serving our customers has been extraordinary during these dynamic times and continues to drive a brand fronted partnership model with our customers. their commitment adaptability and focus on serving our customers has been extraordinary during these dynamic times and continues to drive a brand fronted partnership model with our customers Beyond cyclical dynamics, we expect to drive continued strategic growth through M&A, aftermarket expansion, innovative product development, and our diversified portfolio. beyond cyclical dynamics we expect to drive continued strategic growth through m&a aftermarket expansion innovative product development and our diversified portfolio Our solid balance sheet and solutions-driven strategy keep us well positioned for sustainable long-term profitable growth. our solid balance sheet and solutions-driven strategy keep us well positioned for sustainable long-term profitable growth I'll now turn the call over to Jeff, who will highlight the quarter and provide more detail on our end markets. i'll now turn the call over to jeff who will highlight the quarter and provide more detail on our end markets

Speaker 2: Thanks Andy and good morning everyone. Looking closer at our end markets, third quarter RV revenue increased 7% to $426 million versus the same period in 2024, representing 44% of consolidated revenue. Our RV content per unit on a TTM basis was $5,055, an increase of 3% from the same period last year. On a quarterly basis, CPU increased 8% sequentially compared to the second quarter of 2025 and increased 9% year-over-year. The improvement in the revenue and CPU in the third quarter was driven by our commitment to working with and supporting our customers with model year innovations as they refine and upgrade their products. Coupled with recent acquisitions, we estimate RV retail unit shipments were approximately 100,100 and according to RVIA, wholesale unit shipments were approximately 76,500 in the third quarter. Thanks Andy and good morning everyone. thanks andy and good morning everyone Looking closer at our end markets, third quarter RV revenue increased 7% to $426 million versus the same period in 2024, representing 44% of consolidated revenue. looking closer at our end markets third quarter rv revenue increased 7% to $426 million versus the same period in 2024 representing 44% of consolidated revenue Our RV content per unit on a TTM basis was $5,055, an increase of 3% from the same period last year. our rv content per unit on a ttm basis was $5,055 an increase of 3% from the same period last year On a quarterly basis, CPU increased 8% sequentially compared to the second quarter of 2025 and increased 9% year-over-year. on a quarterly basis cpu increased 8% sequentially compared to the second quarter of 2025 and increased 9% year-over-year The improvement in the revenue and CPU in the third quarter was driven by our commitment to working with and supporting our customers with model year innovations as they refine and upgrade their products. the improvement in the revenue and cpu in the third quarter was driven by our commitment to working with and supporting our customers with model year innovations as they refine and upgrade their products Coupled with recent acquisitions, we estimate RV retail unit shipments were approximately 100,100 and according to RVIA, wholesale unit shipments were approximately 76,500 in the third quarter. coupled with recent acquisitions we estimate rv retail unit shipments were approximately 100,100 and according to rvia wholesale unit shipments were approximately 76,500 in the third quarter This implies a seasonal dealer inventory destock of approximately 23,600 units during the period, resulting in an estimated dealer inventory weeks on hand of approximately 14-16 weeks. This is down from 19-21 weeks in the second quarter of 2025 and reflecting continued OEM wholesale production discipline. This remains well below pre-pandemic historical averages of 26-30 weeks and we further believe the number of discrete units in the field is well below levels seen during the pre-pandemic period. Over the last year we've revealed a long term strategy related to composite solutions. This highlights our efforts to seize emerging market opportunities through both acquisition and innovation. After several years of early stage development and prototyping, we recently unified our composite solutions under the Alpha Composites brand name. This implies a seasonal dealer inventory destock of approximately 23,600 units during the period, resulting in an estimated dealer inventory weeks on hand of approximately 14- 16 weeks. this implies a seasonal dealer inventory destock of approximately 23,600 units during the period resulting in an estimated dealer inventory weeks on hand of approximately 14- 16 weeks This is down from 19- 21 weeks in the second quarter of 2025 and reflecting continued OEM wholesale production discipline. this is down from 19- 21 weeks in the second quarter of 2025 and reflecting continued oem wholesale production discipline This remains well below pre-pandemic historical averages of 26- 30 weeks and we further believe the number of discrete units in the field is well below levels seen during the pre-pandemic period. this remains well below pre-pandemic historical averages of 26- 30 weeks and we further believe the number of discrete units in the field is well below levels seen during the pre-pandemic period Over the last year we've revealed a long term strategy related to composite solutions. over the last year we've revealed a long term strategy related to composite solutions This highlights our efforts to seize emerging market opportunities through both acquisition and innovation. this highlights our efforts to seize emerging market opportunities through both acquisition and innovation After several years of early stage development and prototyping, we recently unified our composite solutions under the Alpha Composites brand name. after several years of early stage development and prototyping we recently unified our composite solutions under the alpha composites brand name Alpha Systems is a Patrick brand that is synonymous with high level customer service providing innovative solutions to RV and MH industries. The team at Alpha Composites will continue to build on the foundation through continued collaboration with our OEM partners. We believe our unified branding approach and dedicated resources will further enhance our competitive position as a leading composite solution provider and innovator in a market where weight, durability, overall cost and sustainability matters to our customers. Our third quarter Marine revenues increased 11% to $150 million, outperforming what we estimate were flat wholesale powerboat unit shipments. Our estimated Marine content per wholesale powerboat unit on a TTM basis was $4,091, an increase of 4% from the same period last year. Estimated content per unit on a quarterly basis was up 15% sequentially compared to the second quarter of 2025 and increased 10% year-over-year. Alpha Systems is a Patrick brand that is synonymous with high level customer service providing innovative solutions to RV and MH industries. alpha systems is a patrick brand that is synonymous with high level customer service providing innovative solutions to rv and mh industries The team at Alpha Composites will continue to build on the foundation through continued collaboration with our OEM partners. the team at alpha composites will continue to build on the foundation through continued collaboration with our oem partners We believe our unified branding approach and dedicated resources will further enhance our competitive position as a leading composite solution provider and innovator in a market where weight, durability, overall cost and sustainability matters to our customers. we believe our unified branding approach and dedicated resources will further enhance our competitive position as a leading composite solution provider and innovator in a market where weight durability overall cost and sustainability matters to our customers Our third quarter Marine revenues increased 11% to $150 million, outperforming what we estimate were flat wholesale powerboat unit shipments. our third quarter marine revenues increased 11% to $150 million outperforming what we estimate were flat wholesale powerboat unit shipments Our estimated Marine content per wholesale powerboat unit on a TTM basis was $4,091, an increase of 4% from the same period last year. our estimated marine content per wholesale powerboat unit on a ttm basis was $4,091 an increase of 4% from the same period last year Estimated content per unit on a quarterly basis was up 15% sequentially compared to the second quarter of 2025 and increased 10% year-over-year. estimated content per unit on a quarterly basis was up 15% sequentially compared to the second quarter of 2025 and increased 10% year-over-year We estimate Marine retail and wholesale powerboat unit shipments were 42,700 and 32,300 units respectively in the third quarter, implying a seasonal dealer field inventory destock of approximately 10,400 units. Dealer inventory in the field remains lean at an estimated 16-18 weeks on hand, down from 20-22 weeks in the second quarter of 2025 and 19-21 weeks on hand last year at this time, remaining well below historical pre-pandemic averages of 36-40 weeks. Like RV, we believe the discrete number of units in the field remains well below pre-pandemic levels. Our broad Marine portfolio and design expertise position us as a key partner to new entrants and our existing base of valued customers alike. New entrants in the pontoon space have begun to leverage the breadth of our offerings and customer services early in their processes. We estimate Marine retail and wholesale powerboat unit shipments were 42,700 and 32,300 units respectively in the third quarter, implying a seasonal dealer field inventory destock of approximately 10,400 units. we estimate marine retail and wholesale powerboat unit shipments were 42,700 and 32,300 units respectively in the third quarter implying a seasonal dealer field inventory destock of approximately 10,400 units Dealer inventory in the field remains lean at an estimated 16- 18 weeks on hand, down from 20- 22 weeks in the second quarter of 2025 and 19- 21 weeks on hand last year at this time, remaining well below historical pre-pandemic averages of 36- 40 weeks. dealer inventory in the field remains lean at an estimated 16- 18 weeks on hand down from 20- 22 weeks in the second quarter of 2025 and 19- 21 weeks on hand last year at this time remaining well below historical pre-pandemic averages of 36- 40 weeks Like RV, we believe the discrete number of units in the field remains well below pre-pandemic levels. like rv we believe the discrete number of units in the field remains well below pre-pandemic levels Our broad Marine portfolio and design expertise position us as a key partner to new entrants and our existing base of valued customers alike. our broad marine portfolio and design expertise position us as a key partner to new entrants and our existing base of valued customers alike New entrants in the pontoon space have begun to leverage the breadth of our offerings and customer services early in their processes. new entrants in the pontoon space have begun to leverage the breadth of our offerings and customer services early in their processes Additionally, related to Andy's mention regarding IBEX, we've identified opportunities in the Marine market related to composites and are now offering a full composite deck solution including composite flooring, woven fabric, and the adhesive that brings it all together, enhancing the strength, sustainability, and ease of installation for our customers. During the quarter, we completed the acquisition of LiliPad Marine, a Traverse City, Michigan-based designer and seller of premium innovative boat ladders, diving board systems, and other Marine accessories. LiliPad delivers their award-winning and patented products through both OEM and aftermarket channels, deepening our lineup of innovative solutions in the Marine space. Our Powersports revenue increased 12% to $98 million in the quarter versus the prior year period, representing 10% of third quarter 2025 consolidated sales. Our revenues improved across all Powersports businesses, including those that serve recreation and audio markets. Additionally, related to Andy's mention regarding IBEX, we've identified opportunities in the Marine market related to composites and are now offering a full composite deck solution including composite flooring, woven fabric, and the adhesive that brings it all together, enhancing the strength, sustainability, and ease of installation for our customers. additionally related to andy's mention regarding ibex we've identified opportunities in the marine market related to composites and are now offering a full composite deck solution including composite flooring woven fabric and the adhesive that brings it all together enhancing the strength sustainability and ease of installation for our customers During the quarter, we completed the acquisition of LiliPad Marine, a Traverse City, Michigan-based designer and seller of premium innovative boat ladders, diving board systems, and other Marine accessories. during the quarter we completed the acquisition of lilipad marine a traverse city michigan-based designer and seller of premium innovative boat ladders diving board systems and other marine accessories LiliPad delivers their award-winning and patented products through both OEM and aftermarket channels, deepening our lineup of innovative solutions in the Marine space. lilipad delivers their award-winning and patented products through both oem and aftermarket channels deepening our lineup of innovative solutions in the marine space Our Powersports revenue increased 12% to $98 million in the quarter versus the prior year period, representing 10% of third quarter 2025 consolidated sales. our powersports revenue increased 12% to $98 million in the quarter versus the prior year period representing 10% of third quarter 2025 consolidated sales Our revenues improved across all Powersports businesses, including those that serve recreation and audio markets. our revenues improved across all powersports businesses including those that serve recreation and audio markets Coupled with continued growth in attachment rates for Sportech's products entering the fourth quarter, we believe the OEMs and dealers will continue to carefully monitor and manage inventory in the channel despite some positive retail signals in recent months. Recently, our Rockford Fosgate brand launched a new 2024+ HD aftermarket solution at Sturgis. This kit includes Rockford's first aftermarket motorcycle amplifier with a built-in A2B digital interface. Not only is this a Rockford first, it is an industry first. This digital amplifier pairs with Rockford's newly launched speakers to create a premium plug and play solution for newer Harley motorcycles. Finally, on Powersports, as we have discussed on a number of calls, the utility segment of the Powersports market has shown much better resilience than the recreation market, leading to improving attachment rates with existing customers. Coupled with continued growth in attachment rates for Sportech's products entering the fourth quarter, we believe the OEMs and dealers will continue to carefully monitor and manage inventory in the channel despite some positive retail signals in recent months. coupled with continued growth in attachment rates for sportech's products entering the fourth quarter we believe the oems and dealers will continue to carefully monitor and manage inventory in the channel despite some positive retail signals in recent months Recently, our Rockford Fosgate brand launched a new 2024+ HD aftermarket solution at Sturgis. recently our rockford fosgate brand launched a new 2024+ hd aftermarket solution at sturgis This kit includes Rockford's first aftermarket motorcycle amplifier with a built-in A2B digital interface. this kit includes rockford's first aftermarket motorcycle amplifier with a built-in a2b digital interface Not only is this a Rockford first, it is an industry first. not only is this a rockford first it is an industry first This digital amplifier pairs with Rockford's newly launched speakers to create a premium plug and play solution for newer Harley motorcycles. this digital amplifier pairs with rockford's newly launched speakers to create a premium plug and play solution for newer harley motorcycles Finally, on Powersports, as we have discussed on a number of calls, the utility segment of the Powersports market has shown much better resilience than the recreation market, leading to improving attachment rates with existing customers. finally on powersports as we have discussed on a number of calls the utility segment of the powersports market has shown much better resilience than the recreation market leading to improving attachment rates with existing customers We have begun to see an increasing interest in adding HVAC and other creature comforts from some of the traditional legacy Powersports OEMs, which should lead to a broader base of demand for enclosures which Sportech provides. On the Housing side of the business, our third quarter revenues were up 1% to $302 million, representing 31% of consolidated sales in Manufactured Housing, which represented approximately 58% of our Housing revenue in the quarter. Our estimated content per unit on a TTM basis increased 2% year-over-year to $6,682. We estimate MH wholesale unit shipments and total Housing starts both decreased 2% in the quarter, as evidenced by our solid Manufactured Housing content per unit performance. We have begun to see an increasing interest in adding HVAC and other creature comforts from some of the traditional legacy Powersports OEMs, which should lead to a broader base of demand for enclosures which Sport ech provides. we have begun to see an increasing interest in adding hvac and other creature comforts from some of the traditional legacy powersports oems which should lead to a broader base of demand for enclosures which sport ech provides On the Housing side of the business, our third quarter revenues were up 1% to $302 million, representing 31% of consolidated sales in Manufactured Housing, which represented approximately 58% of our Housing revenue in the quarter. on the housing side of the business our third quarter revenues were up 1% to $302 million representing 31% of consolidated sales in manufactured housing which represented approximately 58% of our housing revenue in the quarter Our estimated content per unit on a TTM basis increased 2% year-over-year to $6,682. our estimated content per unit on a ttm basis increased 2% year-over-year to $6,682 We estimate MH wholesale unit shipments and total Housing starts both decreased 2% in the quarter, as evidenced by our solid Manufactured Housing content per unit performance. we estimate mh wholesale unit shipments and total housing starts both decreased 2% in the quarter as evidenced by our solid manufactured housing content per unit performance In the face of lower industry wholesale unit shipments, our team continues to perform with strong customer relationships and our ability to align and scale quickly to demand while maintaining a lean fixed cost structure. Despite recent softness in MH shipments, we continue to believe there is a lack of affordable Housing options in the U.S., and we believe our solutions can help both MH and site-built Housing industries provide quality, cost-effective homes efficiently. We believe lower interest rates and improved customer confidence remain pivotal to unlocking pent-up demand. I'll now turn the call over to Andy Roeder, who will provide additional comments on our financial performance. In the face of lower industry wholesale unit shipments, our team continues to perform with strong customer relationships and our ability to align and scale quickly to demand while maintaining a lean fixed cost structure. in the face of lower industry wholesale unit shipments our team continues to perform with strong customer relationships and our ability to align and scale quickly to demand while maintaining a lean fixed cost structure Despite recent softness in MH shipments, we continue to believe there is a lack of affordable Housing options in the U.S., and we believe our solutions can help both MH and site-built Housing industries provide quality, cost-effective homes efficiently. despite recent softness in mh shipments we continue to believe there is a lack of affordable housing options in the u.s and we believe our solutions can help both mh and site-built housing industries provide quality cost-effective homes efficiently We believe lower interest rates and improved customer confidence remain pivotal to unlocking pent-up demand. we believe lower interest rates and improved customer confidence remain pivotal to unlocking pent-up demand I'll now turn the call over to Andy Roeder, who will provide additional comments on our financial performance. i'll now turn the call over to andy roeder who will provide additional comments on our financial performance

Speaker 4: Thanks Jeff and good morning everyone. Consolidated net sales for the quarter increased 6% to $976 million. Our team drove increased revenues in both our Outdoor Enthusiasts and Housing end markets, including a 7% increase in RV revenues, an 11% increase in Marine revenues, a 12% increase in Powersports revenues, and a 1% increase in Housing revenues. As Jeff noted, we generated solid content gains across our end markets during the quarter. Our total revenue growth of 6% was comprised of 4% acquisition growth, 4% organic growth, and -2%. Industry gross margin was 22.6% versus 23.1% in the third quarter of last year. The decline reflected items including short-term inefficiencies related to the model year changeover. Operating margin was 6.8% compared to the prior year at 8.1%. This change was driven by the previously described factors. Thanks Jeff and good morning everyone. thanks jeff and good morning everyone Consolidated net sales for the quarter increased 6% to $976 million. consolidated net sales for the quarter increased 6% to $976 million Our team drove increased revenues in both our Outdoor Enthusiasts and Housing end markets, including a 7% increase in RV revenues, an 11% increase in Marine revenues, a 12% increase in Powersports revenues, and a 1% increase in Housing revenues. our team drove increased revenues in both our outdoor enthusiasts and housing end markets including a 7% increase in rv revenues an 11% increase in marine revenues a 12% increase in powersports revenues and a 1% increase in housing revenues As Jeff noted, we generated solid content gains across our end markets during the quarter. as jeff noted we generated solid content gains across our end markets during the quarter Our total revenue growth of 6% was comprised of 4% acquisition growth, 4% organic growth, and - 2%. our total revenue growth of 6% was comprised of 4% acquisition growth 4% organic growth and - 2% Industry gross margin was 22.6% versus 23.1% in the third quarter of last year. industry gross margin was 22.6% versus 23.1% in the third quarter of last year The decline reflected items including short-term inefficiencies related to the model year changeover. the decline reflected items including short-term inefficiencies related to the model year changeover Operating margin was 6.8% compared to the prior year at 8.1%. operating margin was 6.8% compared to the prior year at 8.1% This change was driven by the previously described factors. this change was driven by the previously described factors Our overall effective tax rate was 26.2% for the third quarter compared to 24.8% in the prior year. Net income was $35 million or $1.01 per diluted share compared to net income of $41 million in the prior year quarter. Our diluted EPS for the third quarter of 2025 included approximately $0.07 in additional accounting-related dilution as a result of the increase in our stock price above the convertible option strike price for our 2028 convertible notes and related warrants. The prior year's diluted EPS included just $0.04 per share. Adjusted EBITDA was $112 million compared to $121 million, while adjusted EBITDA margin was 11.5%, lower by 170 basis points from the third quarter of 2024. Cash provided by operations for the first 9 months of 2025 was $199 million compared to $224 million in the prior year period. Our overall effective tax rate was 26.2% for the third quarter compared to 24.8% in the prior year. our overall effective tax rate was 26.2% for the third quarter compared to 24.8% in the prior year Net income was $35 million or $1.01 per diluted share compared to net income of $41 million in the prior year quarter. net income was $35 million or $1.01 per diluted share compared to net income of $41 million in the prior year quarter Our diluted EPS for the third quarter of 2025 included approximately $0.07 in additional accounting-related dilution as a result of the increase in our stock price above the convertible option strike price for our 2028 convertible notes and related warrants. our diluted eps for the third quarter of 2025 included approximately $0.07 in additional accounting-related dilution as a result of the increase in our stock price above the convertible option strike price for our 2028 convertible notes and related warrants The prior year's diluted EPS included just $0.04 per share. the prior year's diluted eps included just $0.04 per share Adjusted EBITDA was $112 million compared to $121 million, while adjusted EBITDA margin was 11.5%, lower by 170 basis points from the third quarter of 2024. adjusted ebitda was $112 million compared to $121 million while adjusted ebitda margin was 11.5% lower by 170 basis points from the third quarter of 2024 Cash provided by operations for the first 9 months of 2025 was $199 million compared to $224 million in the prior year period. cash provided by operations for the first 9 months of 2025 was $199 million compared to $224 million in the prior year period Purchases of property, plant, and equipment were $26 million in the quarter and $65 million year-to-date. This implies free cash flow of approximately $134 million for the first 9 months of 2025. Total net liquidity at the end of the third quarter was $779 million, comprised of $21 million of cash on hand and unused capacity on a revolving credit facility of $758 million. As a reminder, we have no major debt maturities until 2028 and continue to have the financial strength and capital necessary to capture long-term organic and inorganic growth opportunities. At the end of the third quarter, our net leverage was 2.8x. We returned approximately $13 million to shareholders through quarterly dividends regarding our share buyback. Purchases of property, plant, and equipment were $26 million in the quarter and $65 million year-to-date. purchases of property plant and equipment were $26 million in the quarter and $65 million year-to-date This implies free cash flow of approximately $134 million for the first 9 months of 2025. this implies free cash flow of approximately $134 million for the first 9 months of 2025 Total net liquidity at the end of the third quarter was $779 million, comprised of $21 million of cash on hand and unused capacity on a revolving credit facility of $758 million. total net liquidity at the end of the third quarter was $779 million comprised of $21 million of cash on hand and unused capacity on a revolving credit facility of $758 million As a reminder, we have no major debt maturities until 2028 and continue to have the financial strength and capital necessary to capture long-term organic and inorganic growth opportunities. as a reminder we have no major debt maturities until 2028 and continue to have the financial strength and capital necessary to capture long-term organic and inorganic growth opportunities At the end of the third quarter, our net leverage was 2.8x. at the end of the third quarter our net leverage was 2.8x We returned approximately $13 million to shareholders through quarterly dividends regarding our share buyback. we returned approximately $13 million to shareholders through quarterly dividends regarding our share buyback We remain opportunistic, having repurchased approximately 377,600 shares year-to-date through the third quarter for a total of $32 million, leaving approximately $168 million left on our repurchase authorization. Regarding tariffs, our strategy remains unchanged, and our teams are actively working with supply chain partners to minimize the potential impact. This remains a dynamic landscape, and we will continue to utilize all of our tools that we believe will help neutralize the absolute impact to our pricing pass throughs and ultimately mitigate any material impact to our operating margin. I'll now move to our outlook. We estimate RV retail unit shipments will be down low single digits in 2025, with estimated full year RV industry wholesale unit shipments between the range of 335,000-345,000 units and continue to anchor on equivalent dealer inventory weeks on hand year-over-year. We remain opportunistic, having repurchased approximately 377,600 shares year-to-date through the third quarter for a total of $32 million, leaving approximately $168 million left on our repurchase authorization. we remain opportunistic having repurchased approximately 377,600 shares year-to-date through the third quarter for a total of $32 million leaving approximately $168 million left on our repurchase authorization Regarding tariffs, our strategy remains unchanged, and our teams are actively working with supply chain partners to minimize the potential impact. regarding tariffs our strategy remains unchanged and our teams are actively working with supply chain partners to minimize the potential impact This remains a dynamic landscape, and we will continue to utilize all of our tools that we believe will help neutralize the absolute impact to our pricing pass throughs and ultimately mitigate any material impact to our operating margin. this remains a dynamic landscape and we will continue to utilize all of our tools that we believe will help neutralize the absolute impact to our pricing pass throughs and ultimately mitigate any material impact to our operating margin I'll now move to our outlook. i'll now move to our outlook We estimate RV retail unit shipments will be down low single digits in 2025, with estimated full year RV industry wholesale unit shipments between the range of 335,000- 345,000 units and continue to anchor on equivalent dealer inventory weeks on hand year-over-year. we estimate rv retail unit shipments will be down low single digits in 2025 with estimated full year rv industry wholesale unit shipments between the range of 335,000- 345,000 units and continue to anchor on equivalent dealer inventory weeks on hand year-over-year In Marine, we estimate retail shipments will be down high single digits and estimate wholesale shipments will decline low single digits, again with dealer inventory weeks on hand year-over-year remaining approximately the same. In our Powersports end market, we now estimate that wholesale industry shipments will be down high single digits, and our organic content will be up high single digits, offsetting the industry decline as our content continues to grow given ongoing increasing attachment rates for our cab enclosures. In our Housing market, we estimate MH wholesale unit shipments will be up low to mid single digits for 2025. On the residential Housing side of the market, we estimate 2025 total new site-built Housing starts will be down mid to high single digits year-over-year. Moving to our financial outlook, we expect our full year 2025 adjusted operating margin to be approximately 7%. In Marine, we estimate retail shipments will be down high single digits and estimate wholesale shipments will decline low single digits, again with dealer inventory weeks on hand year-over-year remaining approximately the same. in marine we estimate retail shipments will be down high single digits and estimate wholesale shipments will decline low single digits again with dealer inventory weeks on hand year-over-year remaining approximately the same In our Powersports end market, we now estimate that wholesale industry shipments will be down high single digits, and our organic content will be up high single digits, offsetting the industry decline as our content continues to grow given ongoing increasing attachment rates for our cab enclosures. in our powersports end market we now estimate that wholesale industry shipments will be down high single digits and our organic content will be up high single digits offsetting the industry decline as our content continues to grow given ongoing increasing attachment rates for our cab enclosures In our Housing market, we estimate MH wholesale unit shipments will be up low to mid single digits for 2025. in our housing market we estimate mh wholesale unit shipments will be up low to mid single digits for 2025 On the residential Housing side of the market, we estimate 2025 total new site-built Housing starts will be down mid to high single digits year-over-year. on the residential housing side of the market we estimate 2025 total new site-built housing starts will be down mid to high single digits year-over-year Moving to our financial outlook, we expect our full year 2025 adjusted operating margin to be approximately 7%. moving to our financial outlook we expect our full year 2025 adjusted operating margin to be approximately 7% We continue to estimate that our effective tax rate will be approximately 24%-25% for 2025, implying a quarterly effective tax rate of approximately 26%. For the fourth quarter, we estimate operating cash flow will be between $330 million-$350 million, and we estimate capital expenditures will total $75 million-$85 million. As we continue to reinvest in the business, focusing on automation and innovation initiatives, this implies free cash flow of at least $245 million. For modeling purposes, we'd like to give our initial thoughts regarding 2026. Based on where we sit today, we expect RV wholesale shipments to increase low to mid single digits and RV retail to be flat. For Marine, we expect wholesale shipments to be up low single digits and retail to be flat. In Powersports, we expect low single digit shipment growth and low single digit organic content growth. We continue to estimate that our effective tax rate will be approximately 24%- 25% for 2025, implying a quarterly effective tax rate of approximately 26%. we continue to estimate that our effective tax rate will be approximately 24%- 25% for 2025 implying a quarterly effective tax rate of approximately 26% For the fourth quarter, we estimate operating cash flow will be between $330 million- $350 million, and we estimate capital expenditures will total $75 million- $85 million. for the fourth quarter we estimate operating cash flow will be between $330 million- $350 million and we estimate capital expenditures will total $75 million- $85 million As we continue to reinvest in the business, focusing on automation and innovation initiatives, this implies free cash flow of at least $245 million. as we continue to reinvest in the business focusing on automation and innovation initiatives this implies free cash flow of at least $245 million For modeling purposes, we'd like to give our initial thoughts regarding 2026. for modeling purposes we'd like to give our initial thoughts regarding 2026 Based on where we sit today, we expect RV wholesale shipments to increase low to mid single digits and RV retail to be flat. based on where we sit today we expect rv wholesale shipments to increase low to mid single digits and rv retail to be flat For Marine, we expect wholesale shipments to be up low single digits and retail to be flat. for marine we expect wholesale shipments to be up low single digits and retail to be flat In Powersports, we expect low single digit shipment growth and low single digit organic content growth. in powersports we expect low single digit shipment growth and low single digit organic content growth For MH and Housing starts, we expect both to be flat to up 5%. We believe improved consumer confidence and lower interest rates are key factors necessary for our end markets to rebound more aggressively. Based on these estimates, we expect our operating margin in 2026 to improve meaningfully, an estimated 70-90 basis points. That completes my remarks. We are now ready for questions. For MH and Housing starts, we expect both to be flat to up 5%. for mh and housing starts we expect both to be flat to up 5% We believe improved consumer confidence and lower interest rates are key factors necessary for our end markets to rebound more aggressively. we believe improved consumer confidence and lower interest rates are key factors necessary for our end markets to rebound more aggressively Based on these estimates, we expect our operating margin in 2026 to improve meaningfully, an estimated 70- 90 basis points. based on these estimates we expect our operating margin in 2026 to improve meaningfully an estimated 70- 90 basis points That completes my remarks. that completes my remarks We are now ready for questions. we are now ready for questions

Speaker 8: Thank you. We'll now be conducting a question-and-answer session. If you'd like to ask a question today, you may press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to withdraw your question from the queue. For participants that are using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. To allow as many questions as possible, we ask you please limit yourself to one question and one follow-up. Thank you. Our first question comes from the line of Scott Stember with ROTH Capital. Please proceed with your questions. Thank you. thank you We'll now be conducting a question-and-answer session. we'll now be conducting a question-and-answer session If you'd like to ask a question today, you may press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. if you'd like to ask a question today you may press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue You may press star two if you'd like to withdraw your question from the queue. you may press star two if you'd like to withdraw your question from the queue For participants that are using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. To allow as many questions as possible, we ask you please limit yourself to one question and one follow-up. for participants that are using speaker equipment it may be necessary to pick up your handset before pressing the star keys. to allow as many questions as possible we ask you please limit yourself to one question and one follow-up Thank you. thank you Our first question comes from the line of Scott Stember with ROTH Capital. our first question comes from the line of scott stember with roth capital Please proceed with your questions. please proceed with your questions

Speaker 6: Good morning, guys, and thanks for taking my questions. Good morning, guys, and thanks for taking my questions. good morning guys and thanks for taking my questions

Speaker 1: Morning. Morning. morning

Speaker 6: A lot has been made of some of the increased optimism coming out of Open House. What are you currently seeing from your OEM customers regarding production? What are they telegraphing as far as, you know, their desire to start ramping up production to potentially put more units into the field? A lot has been made of some of the increased optimism coming out of Open House. a lot has been made of some of the increased optimism coming out of open house What are you currently seeing from your OEM customers regarding production? what are you currently seeing from your oem customers regarding production What are they telegraphing as far as, you know, their desire to start ramping up production to potentially put more units into the field? what are they telegraphing as far as you know their desire to start ramping up production to potentially put more units into the field

Speaker 2: Yes. Scott, this is Jeff. As I look at our production numbers or production numbers from the OEMs, we are seeing, we saw a little bit of a slight increase in October. We're seeing a little bit more of an increase in November. We do feel like just the pure production numbers would tell us that there is some ramping up, you know, to what degree that'll, you know, be consistent through, you know, into the first quarter. Right now we're seeing a little of that. Yes. yes Scott, this is Jeff. scott this is jeff As I look at our production numbers or production numbers from the OEMs, we are seeing, we saw a little bit of a slight increase in October. as i look at our production numbers or production numbers from the oems we are seeing we saw a little bit of a slight increase in october We're seeing a little bit more of an increase in November. we're seeing a little bit more of an increase in november We do feel like just the pure production numbers would tell us that there is some ramping up, you know, to what degree that'll, you know, be consistent through, you know, into the first quarter. we do feel like just the pure production numbers would tell us that there is some ramping up you know to what degree that'll you know be consistent through you know into the first quarter Right now we're seeing a little of that. right now we're seeing a little of that As I look forward, after this week, we really only have 6 more weeks of production in 2025 with a week off for Thanksgiving. There is some production in Thanksgiving and then we'll take 2 weeks off for Christmas. I think early indications are if I look year-over-year, we're seeing some increases in the back half of the fourth quarter. As I look forward, after this week, we really only have 6 more weeks of production in 2025 with a week off for Thanksgiving. as i look forward after this week we really only have 6 more weeks of production in 2025 with a week off for thanksgiving There is some production in Thanksgiving and then we'll take 2 weeks off for Christmas. there is some production in thanksgiving and then we'll take 2 weeks off for christmas I think early indications are if I look year-over-year, we're seeing some increases in the back half of the fourth quarter. i think early indications are if i look year-over-year we're seeing some increases in the back half of the fourth quarter

Speaker 6: Got it. Moving over to the aftermarket. I know you guys have been doing a lot of cross pollination with RecPro. Can you give us an update of, you know, new SKUs or just, is that accelerating? Just give us an idea of what's going on. Got it. got it Moving over to the aftermarket. moving over to the aftermarket I know you guys have been doing a lot of cross pollination with RecPro. i know you guys have been doing a lot of cross pollination with recpro Can you give us an update of, you know, new SKUs or just, is that accelerating? can you give us an update of you know new skus or just is that accelerating Just give us an idea of what's going on. just give us an idea of what's going on

Speaker 2: Yes. Scott, this is Jeff again on the RecPro side. We've had several hundred SKUs that have carried over from other Patrick divisions into RecPro this year. So far we'll be close to 400 or 500. Yes. yes Scott, this is Jeff again on the RecPro side. scott this is jeff again on the recpro side We've had several hundred SKUs that have carried over from other Patrick divisions into RecPro this year. we've had several hundred skus that have carried over from other patrick divisions into recpro this year So far we'll be close to 400 or 500. so far we'll be close to 400 or 500 When it's all said and done since the inception of the acquisition, we are looking to accelerate that a little bit. We've really got them entrenched with our Marine side now and all of our Marine divisions to really start to grow that portfolio within the RecPro site. Really excited we put a little bit more capacity in that area to help accelerate that. We're excited about what we've seen so far and what we're going to see looking forward. When it's all said and done since the inception of the acquisition, we are looking to accelerate that a little bit. when it's all said and done since the inception of the acquisition we are looking to accelerate that a little bit We've really got them entrenched with our Marine side now and all of our Marine divisions to really start to grow that portfolio within the RecPro site. we've really got them entrenched with our marine side now and all of our marine divisions to really start to grow that portfolio within the recpro site Really excited we put a little bit more capacity in that area to help accelerate that. really excited we put a little bit more capacity in that area to help accelerate that We're excited about what we've seen so far and what we're going to see looking forward. we're excited about what we've seen so far and what we're going to see looking forward

Speaker 1: One of the other things, Scott, this is Andy, is that we just formally launched our aftermarket strategy, which includes a combination of not only direct to consumer, but direct to dealer and third party distribution. We've rolled out a formal strategy. We're implementing structure to really kind of formally launch an overall vision for where we want to take the aftermarket in alignment with our RecPro platform on the direct to consumer side. We're looking forward to really driving some real value in the aftermarket. One of the other things, Scott, this is Andy, is that we just formally launched our aftermarket strategy, which includes a combination of not only direct to consumer, but direct to dealer and third party distribution. one of the other things scott this is andy is that we just formally launched our aftermarket strategy which includes a combination of not only direct to consumer but direct to dealer and third party distribution We've rolled out a formal strategy. we've rolled out a formal strategy We're implementing structure to really kind of formally launch an overall vision for where we want to take the aftermarket in alignment with our RecPro platform on the direct to consumer side. we're implementing structure to really kind of formally launch an overall vision for where we want to take the aftermarket in alignment with our recpro platform on the direct to consumer side We're looking forward to really driving some real value in the aftermarket. we're looking forward to really driving some real value in the aftermarket

Speaker 6: Got it. Just a little bit more granularity on your comments about the 70-90 basis points of operating margin expansion next year. I assume there will be some sales growth. Just trying to get a sense of how much is sales leverage, how much is internal self help, like things that you have going on like automation and AI, things like that. Just trying to flesh that out. Got it. got it Just a little bit more granularity on your comments about the 70- 90 basis points of operating margin expansion next year. just a little bit more granularity on your comments about the 70- 90 basis points of operating margin expansion next year I assume there will be some sales growth. i assume there will be some sales growth Just trying to get a sense of how much is sales leverage, how much is internal self help, like things that you have going on like automation and AI , things like that. just trying to get a sense of how much is sales leverage how much is internal self help like things that you have going on like automation and ai things like that Just trying to flesh that out. just trying to flesh that out

Speaker 4: Sure. Scott, this is Andy. A lot of it's going to be sales leverage. I would also tell you content gains, the solutions that we're putting together for customers, allowing them to reduce cost overall, but allowing us with more product content with our customers is going to add value there. I think as it relates to the automation efforts, we're going to continue to push forward aggressively on automation amongst our facilities and continue to invest in CapEx. We're definitely picking up nickels and dimes along the way as it relates to the automation efforts that we expect to see. A combination of all of those across the platform drives that margin improvement, and certainly volume plays heavily in there, especially if we go above and beyond kind of our industry expectations. We expect to be able to really leverage our fixed cost structure today. Sure. sure Scott, this is Andy. scott this is andy A lot of it's going to be sales leverage. a lot of it's going to be sales leverage I would also tell you content gains, the solutions that we're putting together for customers, allowing them to reduce cost overall, but allowing us with more product content with our customers is going to add value there. i would also tell you content gains the solutions that we're putting together for customers allowing them to reduce cost overall but allowing us with more product content with our customers is going to add value there I think as it relates to the automation efforts, we're going to continue to push forward aggressively on automation amongst our facilities and continue to invest in CapEx. i think as it relates to the automation efforts we're going to continue to push forward aggressively on automation amongst our facilities and continue to invest in capex We're definitely picking up nickels and dimes along the way as it relates to the automation efforts that we expect to see. we're definitely picking up nickels and dimes along the way as it relates to the automation efforts that we expect to see A combination of all of those across the platform drives that margin improvement, and certainly volume plays heavily in there, especially if we go above and beyond kind of our industry expectations. a combination of all of those across the platform drives that margin improvement and certainly volume plays heavily in there especially if we go above and beyond kind of our industry expectations We expect to be able to really leverage our fixed cost structure today. we expect to be able to really leverage our fixed cost structure today We don't need to add a lot of overhead to support significant incremental volumes. We don't need to add a lot of overhead to support significant incremental volumes. we don't need to add a lot of overhead to support significant incremental volumes

Speaker 6: Gotcha. That's all I have. Gotcha. gotcha That's all I have. that's all i have Thank you. Thank you. thank you

Speaker 4: Thanks. Thanks. thanks

Speaker 8: Our next questions come from the line of Joe Altobello with Raymond James. Please proceed through your questions. Thanks. Our next questions come from the line of Joe Altobello with Raymond James. our next questions come from the line of joe altobello with raymond james Please proceed through your questions. please proceed through your questions Thanks. thanks

Speaker 10: Hey guys, good morning. I guess just to follow up on that operating margin commentary, obviously the outlook for 2026 is encouraging, but it sounds. Hey guys, good morning. hey guys good morning I guess just to follow up on that operating margin commentary, obviously the outlook for 2026 is encouraging, but it sounds. i guess just to follow up on that operating margin commentary obviously the outlook for 2026 is encouraging but it sounds Like you're looking for operating margin, this. Like you're looking for operating margin, this. like you're looking for operating margin this Year toward the lower end of your prior range. Year toward the lower end of your prior range. year toward the lower end of your prior range What is kind of weighing on margin this year ahead of the 2026 improvement? What is kind of weighing on margin this year ahead of the 2026 improvement? what is kind of weighing on margin this year ahead of the 2026 improvement

Speaker 4: Joe, here in the third quarter we really experienced some model change in efficiency. If you look back through the first couple quarters, we've seen gross margin expansion driven primarily by the addition of our direct to consumer aftermarket business RecPro last fall. Along with that came a heavier OpEx profile. This quarter our OpEx is in line, but we just had some, I'll call them one timers, short term investments. We brought on significant new business here in the quarter. CPU was up 9% and 10% for RV and Marine. Significant new business came with that, and with that just come some material and labor inefficiencies. Joe, here in the third quarter we really experienced some model change in efficiency. joe here in the third quarter we really experienced some model change in efficiency If you look back through the first couple quarters, we've seen gross margin expansion driven primarily by the addition of our direct to consumer aftermarket business RecPro last fall. if you look back through the first couple quarters we've seen gross margin expansion driven primarily by the addition of our direct to consumer aftermarket business recpro last fall Along with that came a heavier OpEx profile. along with that came a heavier opex profile This quarter our OpEx is in line, but we just had some, I'll call them one timers, short term investments. this quarter our opex is in line but we just had some i'll call them one timers short term investments We brought on significant new business here in the quarter. we brought on significant new business here in the quarter CPU was up 9% and 10% for RV and Marine. cpu was up 9% and 10% for rv and marine Significant new business came with that, and with that just come some material and labor inefficiencies. significant new business came with that and with that just come some material and labor inefficiencies

Speaker 10: Got it. Got it. got it Okay. Okay. okay In terms of what you're seeing so far in terms. In terms of what you're seeing so far in terms. in terms of what you're seeing so far in terms Of production and shipments in October. Of production and shipments in October. of production and shipments in october November, I think it was in the. November, I think it was in the. november i think it was in the Last call, you guys thought that we. Last call, you guys thought that we. last call you guys thought that we Might see some sort of restock either. Might see some sort of restock either. might see some sort of restock either In the fourth quarter or maybe the first quarter of next year, are you starting to see that potential restock, or is this just kind of. In the fourth quarter or maybe the first quarter of next year, are you starting to see that potential restock, or is this just kind of. in the fourth quarter or maybe the first quarter of next year are you starting to see that potential restock or is this just kind of Noise at the end of a year? Noise at the end of a year? noise at the end of a year

Speaker 2: I think there might be a little bit of potential restock. I mean, we're getting ready to get into the selling season. You know, you got Tampa right around the corner at the beginning of January. I think if you noted during the prepared remarks, 14-16 weeks on hand is extremely low. I mean, that's really the lowest we've seen since the pandemic where it was in the high single digits of weeks on hand back then. There's a lot of room there. The end of 2025, we're at about 17-19 weeks on hand. There's got to be a little bit of restock in there to be able to get the right units on the lots and be prepared for the selling season that's going to come in the first quarter. I think there might be a little bit of potential restock. i think there might be a little bit of potential restock I mean, we're getting ready to get into the selling season. i mean we're getting ready to get into the selling season You know, you got Tampa right around the corner at the beginning of January. you know you got tampa right around the corner at the beginning of january I think if you noted during the prepared remarks, 14 - 16 weeks on hand is extremely low. i think if you noted during the prepared remarks 14 - 16 weeks on hand is extremely low I mean, that's really the lowest we've seen since the pandemic where it was in the high single digits of weeks on hand back then. i mean that's really the lowest we've seen since the pandemic where it was in the high single digits of weeks on hand back then There's a lot of room there. there's a lot of room there The end of 2025, we're at about 17- 19 weeks on hand. the end of 2025 we're at about 17- 19 weeks on hand There's got to be a little bit of restock in there to be able to get the right units on the lots and be prepared for the selling season that's going to come in the first quarter. there's got to be a little bit of restock in there to be able to get the right units on the lots and be prepared for the selling season that's going to come in the first quarter Got it. Got it. got it Okay, thank you, guys. Okay, thank you, guys. okay thank you guys

Speaker 8: Our next questions are from the line of Noah Zatzkin with KeyBanc Capital Markets. Please proceed with your questions. Our next questions are from the line of Noah Zatzkin with KeyBanc Capital Markets. our next questions are from the line of noah zatzkin with keybanc capital markets Please proceed with your questions. please proceed with your questions

Speaker 12: Hi, thanks for taking my question. Hi, thanks for taking my question. hi thanks for taking my question I guess first, maybe if you could. I guess first, maybe if you could. i guess first maybe if you could Expand upon how you're thinking about CPU opportunity in 2026. Within that, you talked. Expand upon how you're thinking about CPU opportunity in 2026. expand upon how you're thinking about cpu opportunity in 2026 Within that, you talked. within that you talked Quite a bit about composites, so just. Quite a bit about composites, so just. quite a bit about composites so just Would love to hear some more thoughts on how that kind of plays into CPU opportunity. Thanks. Would love to hear some more thoughts on how that kind of plays into CPU opportunity. would love to hear some more thoughts on how that kind of plays into cpu opportunity Thanks. thanks

Speaker 2: This is Jeff. In 2026, we expect all of our businesses, as we always do, to pick up anywhere between 3% and 5% organic growth. Our expectation is Composites is going to be a big part of that. I would tell you, if we look right now where we sit today, we believe the total addressable market in that composite area is about $1.5 billion. If you net out some of the cannibalization that may happen, it's close to $1 billion. Our teams are poised and ready to attack that piece of the market. I think with some of the other things going on in the market, that opportunity continues to be very strong. Again, our APG groups are coming up with new product development both on the Marine, RV, and Powersports side. This is Jeff. this is jeff In 2026, we expect all of our businesses, as we always do, to pick up anywhere between 3% and 5% organic growth. in 2026 we expect all of our businesses as we always do to pick up anywhere between 3% and 5% organic growth Our expectation is Composites is going to be a big part of that. our expectation is composites is going to be a big part of that I would tell you, if we look right now where we sit today, we believe the total addressable market in that composite area is about $1.5 billion. i would tell you if we look right now where we sit today we believe the total addressable market in that composite area is about $1.5 billion If you net out some of the cannibalization that may happen, it's close to $1 billion. if you net out some of the cannibalization that may happen it's close to $1 billion Our teams are poised and ready to attack that piece of the market. our teams are poised and ready to attack that piece of the market I think with some of the other things going on in the market, that opportunity continues to be very strong. i think with some of the other things going on in the market that opportunity continues to be very strong Again, our APG groups are coming up with new product development both on the Marine, RV, and Powersports side. again our apg groups are coming up with new product development both on the marine rv and powersports side We believe that the further, I guess, increased attachment rate on the Powersports side is going to give a lot of opportunity to Sportech as more and more OEMs are looking to go to that full attachment. I think across all of our markets we have a lot of opportunity to grow that CPU and continue to grow the business. We believe that the further, I guess, increased attachment rate on the Powersports side is going to give a lot of opportunity to Spor tech as more and more OEMs are looking to go to that full attachment. we believe that the further i guess increased attachment rate on the powersports side is going to give a lot of opportunity to spor tech as more and more oems are looking to go to that full attachment I think across all of our markets we have a lot of opportunity to grow that CPU and continue to grow the business. i think across all of our markets we have a lot of opportunity to grow that cpu and continue to grow the business

Speaker 12: Really helpful. Really helpful. really helpful Maybe just one more, maybe an. Maybe just one more, maybe an. maybe just one more maybe an Update on just M&A. Update on just M&A. update on just m&a What you're seeing out there and kind. What you're seeing out there and kind. what you're seeing out there and kind Of how you're thinking about that. Of how you're thinking about that. of how you're thinking about that Thanks. Thanks. thanks

Speaker 1: Sure. Noah, this is Andy. On the M&A front, we've been really active in the last quarter for sure as it relates to cultivating the acquisition pipeline. We've got candidates identified really across our markets, and we've been out actively talking, building that pipeline up. We're starting to see more deal flow come at us from outside sources as well. Both the organic side of it, we're working with potential targets, as well as the deal feed coming in from investment bankers, has increased over the last probably 30-45 days in particular. We're seeing increased activity on the M&A front. Sure. sure Noah, this is Andy. noah this is andy On the M&A front, we've been really active in the last quarter for sure as it relates to cultivating the acquisition pipeline. on the m&a front we've been really active in the last quarter for sure as it relates to cultivating the acquisition pipeline We've got candidates identified really across our markets, and we've been out actively talking, building that pipeline up. we've got candidates identified really across our markets and we've been out actively talking building that pipeline up We're starting to see more deal flow come at us from outside sources as well. we're starting to see more deal flow come at us from outside sources as well Both the organic side of it, we're working with potential targets, as well as the deal feed coming in from investment bankers, has increased over the last probably 30- 45 days in particular. both the organic side of it we're working with potential targets as well as the deal feed coming in from investment bankers has increased over the last probably 30- 45 days in particular We're seeing increased activity on the M&A front. we're seeing increased activity on the m&a front

Speaker 12: Thank you. Thank you. thank you

Speaker 8: Our next questions are from the line of Daniel Moore with CJS Securities. Please proceed with your questions. Our next questions are from the line of Daniel Moore with CJS Securities. our next questions are from the line of daniel moore with cjs securities Please proceed with your questions. please proceed with your questions

Speaker 7: Thank you. Thank you. thank you Good morning. Good morning. good morning I appreciate all the color. Obviously appreciate the color about dealers weeks. I appreciate all the color. i appreciate all the color Obviously appreciate the color about dealers weeks. obviously appreciate the color about dealers weeks On hand both in RV and Marine as you talk to OEMs and dealers. On hand both in RV and Marine as you talk to OEMs and dealers. on hand both in rv and marine as you talk to oems and dealers We have this sort of historic. We have this sort of historic. we have this sort of historic Backdrop of what averages look like pre-pandemic. Backdrop of what averages look like pre-pandemic. backdrop of what averages look like pre-pandemic Do you have a sense for or? Do you have a sense for or? do you have a sense for or Guess for what a new normal could be. Guess for what a new normal could be. guess for what a new normal could be Look like in terms of weeks on. Look like in terms of weeks on. look like in terms of weeks on Hand in those key end markets? You know, when we get back to. Hand in those key end markets? hand in those key end markets You know, when we get back to. you know when we get back to Say low to mid single digit retail growth cadence. Say low to mid single digit retail growth cadence. say low to mid single digit retail growth cadence

Speaker 1: Dan, this is Andy. If we look at historical numbers, pre-pandemic, RV weeks on hand was roughly 26-30 weeks and Marine weeks on hand was roughly 36-40 weeks pre-pandemic. If you look at where we're kind of sitting today, RV at 14-16 weeks and finishing out last year at roughly, let's just call it 18 weeks, we definitely think there's some restock needed. We absolutely feel that the inventories in the channel today across the spectrum are low and that there is a restock needed even in the current environment. We feel like there's some restocking needed. We don't expect to see the historical pre-pandemic levels, 26-30 weeks on RV and again, 36-40 weeks on Marine. That being said, we definitely know it's bigger than where we're at today. Dan, this is Andy. dan this is andy If we look at historical numbers, pre-pandemic, RV weeks on hand was roughly 26- 30 weeks and Marine weeks on hand was roughly 36- 40 weeks pre-pandemic. if we look at historical numbers pre-pandemic rv weeks on hand was roughly 26- 30 weeks and marine weeks on hand was roughly 36- 40 weeks pre-pandemic If you look at where we're kind of sitting today, RV at 14 - 16 weeks and finishing out last year at roughly, let's just call it 18 weeks, we definitely think there's some restock needed. if you look at where we're kind of sitting today rv at 14 - 16 weeks and finishing out last year at roughly let's just call it 18 weeks we definitely think there's some restock needed We absolutely feel that the inventories in the channel today across the spectrum are low and that there is a restock needed even in the current environment. we absolutely feel that the inventories in the channel today across the spectrum are low and that there is a restock needed even in the current environment We feel like there's some restocking needed. we feel like there's some restocking needed We don't expect to see the historical pre-pandemic levels, 26- 30 weeks on RV and again, 36- 40 weeks on Marine. we don't expect to see the historical pre-pandemic levels 26- 30 weeks on rv and again 36- 40 weeks on marine That being said, we definitely know it's bigger than where we're at today. that being said we definitely know it's bigger than where we're at today Marine today, as Jeff mentioned, 16-18 weeks on hand last year. At the end of the year, we were at 22 weeks. We feel like there's some restock coming and needed. We do feel like inventories are low, but we do think, you know, I'm going to say, you know, let's just say 22-24 weeks is probably a good range to kind of think about right now, at least in our estimation. We also know that dealers have gotten really good at working with less inventory. That being said, we also do feel across our spectrum, and we have multiple touches with the dealer network, whether it's our transportation business or whether it's our touches with the OEMs or dealers themselves. We get a feel that inventories are lean and that dealers will need some more balance out there. Marine today, as Jeff mentioned, 16- 18 weeks on hand last year. marine today as jeff mentioned 16- 18 weeks on hand last year At the end of the year, we were at 22 weeks. at the end of the year we were at 22 weeks We feel like there's some restock coming and needed. we feel like there's some restock coming and needed We do feel like inventories are low, but we do think, you know, I'm going to say, you know, let's just say 22- 24 weeks is probably a good range to kind of think about right now, at least in our estimation. we do feel like inventories are low but we do think you know i'm going to say you know let's just say 22- 24 weeks is probably a good range to kind of think about right now at least in our estimation We also know that dealers have gotten really good at working with less inventory. we also know that dealers have gotten really good at working with less inventory That being said, we also do feel across our spectrum, and we have multiple touches with the dealer network, whether it's our transportation business or whether it's our touches with the OEMs or dealers themselves. that being said we also do feel across our spectrum and we have multiple touches with the dealer network whether it's our transportation business or whether it's our touches with the oems or dealers themselves We get a feel that inventories are lean and that dealers will need some more balance out there. we get a feel that inventories are lean and that dealers will need some more balance out there We do feel like there's some, again, restock needed. We do feel like there's some, again, restock needed. we do feel like there's some again restock needed

Speaker 7: Really helpful. Switching gears, initial guidance for 2026 implies operating margin getting back close to 8%. Really helpful. really helpful Switching gears, initial guidance for 2026 implies operating margin getting back close to 8%. switching gears initial guidance for 2026 implies operating margin getting back close to 8% As you look across the businesses and when demand starts to return, where do you. As you look across the businesses and when demand starts to return, where do you. as you look across the businesses and when demand starts to return where do you You see the most significant capacity and. You see the most significant capacity and. you see the most significant capacity and Strongest kind of incremental margins and opportunity. Strongest kind of incremental margins and opportunity. strongest kind of incremental margins and opportunity For further expansion beyond that across the various businesses? For further expansion beyond that across the various businesses? for further expansion beyond that across the various businesses

Speaker 1: Sure. Sure. sure Given what we've done with our business, our team's discipline and really managing their businesses, some of the consolidations that we've done, as well, just really maintaining a lean operating structure and continuous improvement environment, there is leverage ability across all of our pillars and all of our business segments. Incrementally there's a few puts and takes, but overall, I tell you, there's significant incremental opportunity for us to leverage the business in each of our markets. Given what we've done with our business, our team's discipline and really managing their businesses, some of the consolidations that we've done, as well, just really maintaining a lean operating structure and continuous improvement environment, there is leverage ability across all of our pillars and all of our business segments. given what we've done with our business our team's discipline and really managing their businesses some of the consolidations that we've done as well just really maintaining a lean operating structure and continuous improvement environment there is leverage ability across all of our pillars and all of our business segments Incrementally there's a few puts and takes, but overall, I tell you, there's significant incremental opportunity for us to leverage the business in each of our markets. incrementally there's a few puts and takes but overall i tell you there's significant incremental opportunity for us to leverage the business in each of our markets

Speaker 7: Got it. If you did and I missed it, forgive me. Can you maybe quantify in ballpark terms the. Got it. got it If you did and I missed it, forgive me. if you did and i missed it forgive me Can you maybe quantify in ballpark terms the. can you maybe quantify in ballpark terms the Impact of inefficiencies related to the model. Impact of inefficiencies related to the model. impact of inefficiencies related to the model Year changeover this quarter? Year changeover this quarter? year changeover this quarter

Speaker 4: Yeah, Dan. I mean, we saw in the first two quarters our gross margin expand by, you know, near 100 basis points. There's some noise in there, you know, with tariff impacts and timing, but for the most part, you know, I think that's. We expect a meaningful gross margin expansion driven by our RecPro direct to consumer margins in that acquisition last fall. You know, we were down 50 basis points. I guess I'd expect us to be up, you know, 50 basis points that ballpark as we look forward. Yeah, Dan. yeah dan I mean, we saw in the first two quarters our gross margin expand by, you know, near 100 basis points. i mean we saw in the first two quarters our gross margin expand by you know near 100 basis points There's some noise in there, you know, with tariff impacts and timing, but for the most part, you know, I think that's. there's some noise in there you know with tariff impacts and timing but for the most part you know i think that's We expect a meaningful gross margin expansion driven by our RecPro direct to consumer margins in that acquisition last fall. we expect a meaningful gross margin expansion driven by our recpro direct to consumer margins in that acquisition last fall You know, we were down 50 basis points. you know we were down 50 basis points I guess I'd expect us to be up, you know, 50 basis points that ballpark as we look forward. i guess i'd expect us to be up you know 50 basis points that ballpark as we look forward

Speaker 7: Got it. Helpful. Thank you. Appreciate it. Got it. got it Helpful. helpful Thank you. thank you Appreciate it. appreciate it Andy. Andy. andy

Speaker 8: The next question is from the line of Tristan Thomas-Martin with BMO Capital Markets. Please proceed with your question. The next question is from the line of Tristan Thomas-Martin with BMO Capital Markets. the next question is from the line of tristan thomas-martin with bmo capital markets Please proceed with your question. please proceed with your question

Speaker 9: Hey, good morning. Do you have any kind of thoughts? Hey, good morning. hey good morning Do you have any kind of thoughts? do you have any kind of thoughts Have you seen any of the consumer kind of changes based on modeling or pricing being up, call it. Have you seen any of the consumer kind of changes based on modeling or pricing being up, call it. have you seen any of the consumer kind of changes based on modeling or pricing being up call it Mid to high single digits. Mid to high single digits. mid to high single digits

Speaker 1: Can you repeat that question? Can you repeat that question ? can you repeat that question

Speaker 9: Sorry, just asking. Sorry, just asking. sorry just asking With model year 2026 pricing up mid to high single digits, kind of like. With model year 2026 pricing up mid to high single digits, kind of like. with model year 2026 pricing up mid to high single digits kind of like How are you seeing consumers and dealers react to that? How are you seeing consumers and dealers react to that? how are you seeing consumers and dealers react to that

Speaker 2: Yeah, this is Jeff. I think they've certainly passed that along into the channel as we could tell. We did see some increased retail year-over-year in June and July. That came down a little bit in August. Overall, we can only tell you where the production numbers are telling us right now since we haven't really seen retail for September and October. Once we see those, we'll get a better feel overall of the retail demand. From what we can tell from production levels and where we think wholesale shipments are going, there's still demand out there and we feel good that they've been able to absorb that into the pricing. We have seen a little bit of interest rate help, which certainly will help mitigate some of the pricing that's happened. Overall, we feel good about kind of where the pricing's ended up. Yeah, this is Jeff. yeah this is jeff I think they've certainly passed that along into the channel as we could tell. i think they've certainly passed that along into the channel as we could tell We did see some increased retail year-over-year in June and July. we did see some increased retail year-over-year in june and july That came down a little bit in August. that came down a little bit in august Overall, we can only tell you where the production numbers are telling us right now since we haven't really seen retail for September and October. overall we can only tell you where the production numbers are telling us right now since we haven't really seen retail for september and october Once we see those, we'll get a better feel overall of the retail demand. once we see those we'll get a better feel overall of the retail demand From what we can tell from production levels and where we think wholesale shipments are going, there's still demand out there and we feel good that they've been able to absorb that into the pricing. from what we can tell from production levels and where we think wholesale shipments are going there's still demand out there and we feel good that they've been able to absorb that into the pricing We have seen a little bit of interest rate help, which certainly will help mitigate some of the pricing that's happened. we have seen a little bit of interest rate help which certainly will help mitigate some of the pricing that's happened Overall, we feel good about kind of where the pricing's ended up. overall we feel good about kind of where the pricing's ended up As far as what tariff noise had been out there earlier in the year, we've got a few more countries they need to sort some things out with. As we look, we've been working very closely with customers. We know that affordability is a big concern and partnering with our customers to help with that affordability is something that we've been very active in over the last quarter. As far as what tariff noise had been out there earlier in the year, we've got a few more countries they need to sort some things out with. as far as what tariff noise had been out there earlier in the year we've got a few more countries they need to sort some things out with As we look, we've been working very closely with customers. as we look we've been working very closely with customers We know that affordability is a big concern and partnering with our customers to help with that affordability is something that we've been very active in over the last quarter. we know that affordability is a big concern and partnering with our customers to help with that affordability is something that we've been very active in over the last quarter

Speaker 9: Okay. Okay. okay It's kind of the obvious follow-up. It's kind of the obvious follow-up. it's kind of the obvious follow-up How's the production mix been looking in terms of like are we seeing. How's the production mix been looking in terms of like are we seeing. how's the production mix been looking in terms of like are we seeing Maybe a little chip towards fifth wheels. Maybe a little chip towards fifth wheels. maybe a little chip towards fifth wheels Away from single axle? Away from single axle? away from single axle

Speaker 2: Yeah, we've seen a little of that. I mean, it certainly does occur a lot of times in the fall where we'll see a little bit more on the fifth wheel side as you get the full-time RVers, they're going to use it for the full winter. Getting into a fifth wheel versus the smaller entry level, certainly the mix is not back to what I would call a normal mix that we've seen in the past with fifth wheel and travel trailer and the smaller travel trailers, but we have seen a little bit of a shift in the third quarter. We expect that that'll stay for the fourth if we get into the first part of next year. I think the dealers were so kind of keen on the entry level product for most of 2025. Yeah, we've seen a little of that. yeah we've seen a little of that I mean, it certainly does occur a lot of times in the fall where we'll see a little bit more on the fifth wheel side as you get the full-time RVers, they're going to use it for the full winter. i mean it certainly does occur a lot of times in the fall where we'll see a little bit more on the fifth wheel side as you get the full-time rvers they're going to use it for the full winter Getting into a fifth wheel versus the smaller entry level, certainly the mix is not back to what I would call a normal mix that we've seen in the past with fifth wheel and travel trailer and the smaller travel trailers, but we have seen a little bit of a shift in the third quarter. getting into a fifth wheel versus the smaller entry level certainly the mix is not back to what i would call a normal mix that we've seen in the past with fifth wheel and travel trailer and the smaller travel trailers but we have seen a little bit of a shift in the third quarter We expect that that'll stay for the fourth if we get into the first part of next year. we expect that that'll stay for the fourth if we get into the first part of next year I think the dealers were so kind of keen on the entry level product for most of 2025. i think the dealers were so kind of keen on the entry level product for most of 2025 As we see that they need to refill some of the stock that's out there, I think we're going to see that's going to be in some of the mid to higher end product. We feel good about where the mix is at. I don't think it'll go backwards into the more small travel trailers, but we're keeping an active look at that. As we see that they need to refill some of the stock that's out there, I think we're going to see that's going to be in some of the mid to higher end product. as we see that they need to refill some of the stock that's out there i think we're going to see that's going to be in some of the mid to higher end product We feel good about where the mix is at. we feel good about where the mix is at I don't think it'll go backwards into the more small travel trailers, but we're keeping an active look at that. i don't think it'll go backwards into the more small travel trailers but we're keeping an active look at that

Speaker 9: Okay, got it. Okay, got it. okay got it Just squeeze one more. Just squeeze one more. just squeeze one more Is there any way to think about the composite $1 billion addressable market opportunity, kind of how that breaks out across your end markets? Is there any way to think about the composite $1 billion addressable market opportunity, kind of how that breaks out across your end markets? is there any way to think about the composite $1 billion addressable market opportunity kind of how that breaks out across your end markets Thanks. Thanks. thanks

Speaker 2: Yeah, it's primarily in the RV market right now. When you look at the roofing and flooring solutions that we're providing, we're really not into that business right now with roofing, flooring, and slide outs. The interior and exterior skins are something that we're participating in right now. We're very active in shifting from some of the wood products that we're currently selling into composites. We feel really good about all the prototyping that we've done and the activity and the products we've been able to bring to market. Certainly, we see some opportunity on the Marine side. It's pretty fresh on the Marine side. We've done a lot on the wood products within Marine, and now we're starting to shift over into some of the composites. Yeah, it's primarily in the RV market right now. yeah it's primarily in the rv market right now When you look at the roofing and flooring solutions that we're providing, we're really not into that business right now with roofing, flooring, and slide outs. when you look at the roofing and flooring solutions that we're providing we're really not into that business right now with roofing flooring and slide outs The interior and exterior skins are something that we're participating in right now. the interior and exterior skins are something that we're participating in right now We're very active in shifting from some of the wood products that we're currently selling into composites. we're very active in shifting from some of the wood products that we're currently selling into composites We feel really good about all the prototyping that we've done and the activity and the products we've been able to bring to market. we feel really good about all the prototyping that we've done and the activity and the products we've been able to bring to market Certainly, we see some opportunity on the Marine side. certainly we see some opportunity on the marine side It's pretty fresh on the Marine side. it's pretty fresh on the marine side We've done a lot on the wood products within Marine, and now we're starting to shift over into some of the composites. we've done a lot on the wood products within marine and now we're starting to shift over into some of the composites I would tell you that the majority of what we talked about in the addressable market is going to come on the RV side to start with. I would tell you that the majority of what we talked about in the addressable market is going to come on the RV side to start with. i would tell you that the majority of what we talked about in the addressable market is going to come on the rv side to start with

Speaker 9: Thank you. Thank you. thank you

Speaker 8: The next question is from the line of Craig Kennison with Baird. Please proceed with your questions. The next question is from the line of Craig Kennison with Baird. the next question is from the line of craig kennison with baird Please proceed with your questions. please proceed with your questions

Speaker 3: Hey, thanks for taking my question. Hey, thanks for taking my question. hey thanks for taking my question Apologies for joining a little late. Apologies for joining a little late. apologies for joining a little late Wanted to ask about slide 15. Wanted to ask about slide 15. wanted to ask about slide 15 Talking about Powersports organic content growth up low single digit. What is driving that? Talking about Powersports organic content growth up low single digit. talking about powersports organic content growth up low single digit What is driving that? what is driving that

Speaker 1: Hey, Craig. Hey, Craig. hey craig Without question, content gains that we've seen as it relates to attachment rates for our enclosures in particular, we've seen as we've talked about kind of the utility side of the business, which is really where we've got tremendous focus, being more resilient than the rec side of it. That being said, the overall take rate continues to go up on enclosures and continued take rate on HVAC systems, which in the side-by-side markets continues to go up. We're seeing that, we're seeing some new entrants come into the market in 2026, as well as some of the product innovations that we've had teed up over the last couple of years are expected to continue to drive content as well. Without question, content gains that we've seen as it relates to attachment rates for our enclosures in particular, we've seen as we've talked about kind of the utility side of the business, which is really where we've got tremendous focus, being more resilient than the rec side of it. without question content gains that we've seen as it relates to attachment rates for our enclosures in particular we've seen as we've talked about kind of the utility side of the business which is really where we've got tremendous focus being more resilient than the rec side of it That being said, the overall take rate continues to go up on enclosures and continued take rate on HVAC systems, which in the side-by-side markets continues to go up. that being said the overall take rate continues to go up on enclosures and continued take rate on hvac systems which in the side-by-side markets continues to go up We're seeing that, we're seeing some new entrants come into the market in 2026, as well as some of the product innovations that we've had teed up over the last couple of years are expected to continue to drive content as well. we're seeing that we're seeing some new entrants come into the market in 2026 as well as some of the product innovations that we've had teed up over the last couple of years are expected to continue to drive content as well We're excited about not only the uptake rate but some of the solutions we're bringing and the opportunity for us to really exhibit our full solutions model as well into the Powersports market. Not only an enclosure, for example, but also a sound system, a wiring harness, a dash panel, instrumentation system all combined into one solution for our customers going forward. A tremendous opportunity for us to continue to realize additional content gains in the side-by-side market. We're excited about not only the uptake rate but some of the solutions we're bringing and the opportunity for us to really exhibit our full solutions model as well into the Powersports market. we're excited about not only the uptake rate but some of the solutions we're bringing and the opportunity for us to really exhibit our full solutions model as well into the powersports market Not only an enclosure, for example, but also a sound system, a wiring harness, a dash panel, instrumentation system all combined into one solution for our customers going forward. not only an enclosure for example but also a sound system a wiring harness a dash panel instrumentation system all combined into one solution for our customers going forward A tremendous opportunity for us to continue to realize additional content gains in the side-by-side market. a tremendous opportunity for us to continue to realize additional content gains in the side-by-side market

Speaker 3: Thanks, Andy. Thanks, Andy. thanks andy Maybe just to follow up on the RecPro topic, how do. Maybe just to follow up on the RecPro topic, how do. maybe just to follow up on the recpro topic how do You manage any sort of channel conflict. You manage any sort of channel conflict. you manage any sort of channel conflict That might come about. That might come about. that might come about Setting up a direct-to-consumer platform? Setting up a direct-to-consumer platform? setting up a direct-to-consumer platform

Speaker 2: Yeah, Craig, this is Jeff. I don't see a lot of channel conflict in what we're doing. Prior to having RecPro on board, which gives us that direct to consumer avenue for our products, we had very little aftermarket touch points. If you look at the content that Patrick Industries is putting into RVs and Marine and then not really having an outlet to be able to get that product into the hands of the end consumer, this is really just giving us that avenue. I don't see a lot of conflict there. Yeah, Craig, this is Jeff. yeah craig this is jeff I don't see a lot of channel conflict in what we're doing. i don't see a lot of channel conflict in what we're doing Prior to having RecPro on board, which gives us that direct to consumer avenue for our products, we had very little aftermarket touch points. prior to having recpro on board which gives us that direct to consumer avenue for our products we had very little aftermarket touch points If you look at the content that Patrick Industries is putting into RVs and Marine and then not really having an outlet to be able to get that product into the hands of the end consumer, this is really just giving us that avenue. if you look at the content that patrick industries is putting into rvs and marine and then not really having an outlet to be able to get that product into the hands of the end consumer this is really just giving us that avenue I don't see a lot of conflict there. i don't see a lot of conflict there

Speaker 3: Thank you, Jeff. Maybe finally on the MH side, what will it take to see. Thank you, Jeff. thank you jeff Maybe finally on the MH side, what will it take to see. maybe finally on the mh side what will it take to see A more sustained recovery? A more sustained recovery? a more sustained recovery It feels like there's ample need for affordable Housing and we're going to get interest rates moving in our favor. What are your industry context suggesting is necessary for that really to take off? It feels like there's ample need for affordable Housing and we're going to get interest rates moving in our favor. it feels like there's ample need for affordable housing and we're going to get interest rates moving in our favor What are your industry context suggesting is necessary for that really to take off? what are your industry context suggesting is necessary for that really to take off

Speaker 1: Sure. Craig, this is Andy, it's a good question. I think as we look at the MH side of the business, we certainly continue to believe, you know, in the model that it provides the low cost alternative, especially for first time entrance into the Housing market. Historically, MH has run 9%-11% of single family Housing starts. Sure. sure Craig, this is Andy, it's a good question. craig this is andy it's a good question I think as we look at the MH side of the business, we certainly continue to believe, you know, in the model that it provides the low cost alternative, especially for first time entrance into the Housing market. i think as we look at the mh side of the business we certainly continue to believe you know in the model that it provides the low cost alternative especially for first time entrance into the housing market Historically, MH has run 9%- 11% of single family Housing starts. historically mh has run 9%- 11% of single family housing starts If you go back in history and we continue to see that, you know, trend continue, you know, as far as I'm concerned, as we continue to watch that, you know, we're going to continue to look for an inflection point where we see that trend change a little bit, we see a greater percentage of single family housing starts is our indicator. Overall, the model, the narrative, you know, makes a lot of sense especially with where things are at. We just think some of the pent up demand needs to be released into that market, but we're fully supportive of it. As well, the quality of the homes have gotten so much better over the years. It really is an attractive solution as well, waiting for kind of that inflection point. If you go back in history and we continue to see that, you know, trend continue, you know, as far as I'm concerned, as we continue to watch that, you know, we're going to continue to look for an inflection point where we see that trend change a little bit, we see a greater percentage of single family housing starts is our indicator. if you go back in history and we continue to see that you know trend continue you know as far as i'm concerned as we continue to watch that you know we're going to continue to look for an inflection point where we see that trend change a little bit we see a greater percentage of single family housing starts is our indicator Overall, the model, the narrative, you know, makes a lot of sense especially with where things are at. overall the model the narrative you know makes a lot of sense especially with where things are at We just think some of the pent up demand needs to be released into that market, but we're fully supportive of it. we just think some of the pent up demand needs to be released into that market but we're fully supportive of it As well, the quality of the homes have gotten so much better over the years. as well the quality of the homes have gotten so much better over the years It really is an attractive solution as well, waiting for kind of that inflection point. it really is an attractive solution as well waiting for kind of that inflection point

Speaker 3: Thanks, Andy. Thanks, Andy. thanks andy

Speaker 1: Yep. Yep. yep

Speaker 8: As a reminder, if you'd like to ask a question today, you may press star one from your telephone keypad. Our next question comes from the line of Mike Albanese with Benchmark. Please proceed with your questions. As a reminder, if you'd like to ask a question today, you may press star one from your telephone keypad. as a reminder if you'd like to ask a question today you may press star one from your telephone keypad Our next question comes from the line of Mike Albanese with Benchmark. our next question comes from the line of mike albanese with benchmark Please proceed with your questions. please proceed with your questions

Speaker 5: Yeah. Yeah. yeah Hey, good morning, guys. Hey, good morning, guys. hey good morning guys Thanks for taking my question. I just want to touch on, you know. Thanks for taking my question. I just want to touch on, you know. thanks for taking my question. i just want to touch on you know Craig had asked a question about the Powersports segment. As we think about it. Craig had asked a question about the Powersports segment. craig had asked a question about the powersports segment As we think about it. as we think about it Attachment rates and products like HVAC. Attachment rates and products like HVAC. attachment rates and products like hvac Is it possible to kind of frame, you know, maybe from. Is it possible to kind of frame, you know, maybe from. is it possible to kind of frame you know maybe from From an industry standpoint, what percentage of the overall utility industry comes with enclosures? From an industry standpoint, what percentage of the overall utility industry comes with enclosures? from an industry standpoint what percentage of the overall utility industry comes with enclosures

Speaker 1: Let me think about that for a minute, Mike. The percentage of the industry, probably. Let me think about that for a minute, Mike. let me think about that for a minute mike The percentage of the industry, probably. the percentage of the industry probably

Speaker 5: Today, utility side by side, like how, how, you know. Today, utility side by side, like how, how, you know. today utility side by side like how how you know

Speaker 1: How many utility vehicles are coming with enclosures? I mean, probably 60%, 70%. How many utility vehicles are coming with enclosures? how many utility vehicles are coming with enclosures I mean, probably 60%, 70%. i mean probably 60% 70%

Speaker 5: Okay. Okay. okay

Speaker 1: It's a guess. I can't tell you exactly. It's a guess. it's a guess I can't tell you exactly. i can't tell you exactly

Speaker 2: It is definitely going to be heavier on the utility side versus the side by side, Mike. It is definitely going to be heavier on the utility side versus the side by side, Mike. it is definitely going to be heavier on the utility side versus the side by side mike

Speaker 5: Correct. Correct. correct

Speaker 2: We're dealing primarily with a couple of the large manufacturers. There are some of the manufacturers out there that aren't even offering that yet, but we believe that's a big tailwind for us when they start to go into that market. Within our customers, it's that 60%, like Andy was talking about, but the overall market, I think there's opportunity beyond that. We're dealing primarily with a couple of the large manufacturers. There are some of the manufacturers out there that aren't even offering that yet, but we believe that's a big tailwind for us when they start to go into that market. we're dealing primarily with a couple of the large manufacturers. there are some of the manufacturers out there that aren't even offering that yet but we believe that's a big tailwind for us when they start to go into that market Within our customers, it's that 60%, like Andy was talking about, but the overall market, I think there's opportunity beyond that. within our customers it's that 60% like andy was talking about but the overall market i think there's opportunity beyond that

Speaker 5: Yeah, that's exactly where I was going with the question. Yeah, that's exactly where I was going with the question. yeah that's exactly where i was going with the question Just to get a sense of, you know, as enclosures proliferate. Just to get a sense of, you know, as enclosures proliferate. just to get a sense of you know as enclosures proliferate With that comes more opportunities to drive new product and increase attachment rates, right. With that comes more opportunities to drive new product and increase attachment rates, right. with that comes more opportunities to drive new product and increase attachment rates right I was trying to get a sense of, you know. I was trying to get a sense of, you know. i was trying to get a sense of you know

Speaker 1: Not only that, Mike, but the frame. Not only that, Mike, but the frame. not only that mike but the frame Not only. Not only. not only Some come with a frame, right? Some come with a windshield. The attachment to add doors, to add windows, then the additional content that we've talked about on top of that from a solution perspective, kind of all play into that. Some come with a frame, right? some come with a frame right Some come with a windshield. some come with a windshield The attachment to add doors, to add windows, then the additional content that we've talked about on top of that from a solution perspective, kind of all play into that. the attachment to add doors to add windows then the additional content that we've talked about on top of that from a solution perspective kind of all play into that

Speaker 5: Got it. Thanks. Got it. got it Thanks. thanks

Speaker 8: Thank you. Thank you, ladies and gentlemen. I'll turn it back to Andy Nemeth for closing remarks. Thank you. thank you Thank you, ladies and gentlemen. thank you ladies and gentlemen I'll turn it back to Andy Nemeth for closing remarks. i'll turn it back to andy nemeth for closing remarks

Speaker 1: Thank you. Once again, I just really want to acknowledge and thank our incredible team for just their continued efforts, dedication, passion, for really partnering with our customers, bringing new products to market, managing the tariff situation, and continuing to deliver consistent and predictable results. I'm just so proud of the team and all their efforts, and as well want to thank our customers for their tremendous support through these incredibly dynamic times. As we continue to really work to partner, to make sure we're promoting the industry as a whole in alignment with their goals and objectives, I really appreciate all the efforts of the team. We will continue to push forward. I think there's a ton of opportunity for Patrick as we look at where the industries are teed up and where they can go. Thank you. thank you Once again, I just really want to acknowledge and thank our incredible team for just their continued efforts, dedication, passion, for really partnering with our customers, bringing new products to market, managing the tariff situation, and continuing to deliver consistent and predictable results. once again i just really want to acknowledge and thank our incredible team for just their continued efforts dedication passion for really partnering with our customers bringing new products to market managing the tariff situation and continuing to deliver consistent and predictable results I'm just so proud of the team and all their efforts, and as well want to thank our customers for their tremendous support through these incredibly dynamic times. i'm just so proud of the team and all their efforts and as well want to thank our customers for their tremendous support through these incredibly dynamic times As we continue to really work to partner, to make sure we're promoting the industry as a whole in alignment with their goals and objectives, I really appreciate all the efforts of the team. as we continue to really work to partner to make sure we're promoting the industry as a whole in alignment with their goals and objectives i really appreciate all the efforts of the team We will continue to push forward. we will continue to push forward I think there's a ton of opportunity for Patrick as we look at where the industries are teed up and where they can go. i think there's a ton of opportunity for patrick as we look at where the industries are teed up and where they can go Not only that, the resilience and scalability of our model and the ability to inflect when our customers need it, I'm really excited about. Once again, thank you very much for joining us. We look forward to talking to you after our fourth quarter results. Not only that, the resilience and scalability of our model and the ability to inflect when our customers need it, I'm really excited about. not only that the resilience and scalability of our model and the ability to inflect when our customers need it i'm really excited about Once again, thank you very much for joining us. once again thank you very much for joining us We look forward to talking to you after our fourth quarter results. we look forward to talking to you after our fourth quarter results

Speaker 8: Thank you. Ladies and gentlemen, this concludes today's teleconference. Thank you for your participation. You may now disconnect. Thank you. thank you Ladies and gentlemen, this concludes today's teleconference. ladies and gentlemen this concludes today's teleconference Thank you for your participation. thank you for your participation You may now disconnect. you may now disconnect