Patrick Industries’ Adjusted Earnings Reach $1.03 per Share as Net Income Falls to $21 Million
Key Facts
Patrick Industries reported results for the third quarter and the nine months ended September 27, 2026, posting reported net income of $21 million and diluted earnings per share of $0.64. Adjusted net income was $34 million, or adjusted diluted earnings per share of $1.03. Adjusted net income in the year-earlier quarter was $35 million, with adjusted earnings per share of $1.01. These figures show a difference between reported and adjusted profit and a year-over-year decline in the latter. The official release did not establish an analyst estimate or comparison.
Net sales were $975 million, compared with $976 million in the third quarter of 2025, leaving revenue nearly flat. Powersports revenue grew 30% year over year, marine revenue rose 14%, and housing revenue increased 4%. By contrast, recreational vehicle revenue fell 15%. The company said growth in the three segments nearly offset the decline in recreational vehicles. At the activity level, wholesale recreational vehicle shipments fell 13%, while estimated wholesale powerboat shipments increased 8%.
Weakness in recreational vehicles weighed on operating profitability: operating income was $50 million, compared with $66 million a year earlier, and the operating margin fell to 5.1% from 6.8%. Excluding merger and restructuring expenses and other nonrecurring items, the adjusted operating margin held at 6.8%. Meanwhile, adjusted earnings before interest, taxes, depreciation and amortization rose 3% to $116 million. The margin on those earnings widened 40 basis points to 11.9%. The divergence in operating metrics reflects the impact of items excluded from the adjusted calculation, as well as differing performance across the company’s segments.
The chief executive said the company’s markets continued to face volatile economic conditions, and that growth in marine, powersports and housing reflected the diversity of the markets in which the company operates. He linked the decline in recreational vehicle revenue to lower wholesale shipments. He added that pressures included high interest rates, fuel costs and inflation, along with a further decline in consumer confidence. He said: "Our markets remain volatile, with ongoing economic headwinds, including high interest rates, rising fuel costs and inflation, which have led to a further decline in consumer confidence."
On cash flow, cash generated from operating activities was $147 million in the first nine months of 2026, compared with $199 million in the same period a year earlier. The company said the change reflected the deployment of working capital to support its composite products growth strategy, along with proactive management of customer inventory. Free cash flow for the twelve months ended with the third quarter was $203 million, compared with $211 million in the comparable period. The company returned $15 million to shareholders through quarterly dividends during the quarter. Available liquidity was $716 million at quarter-end, while net leverage was 2.9 times.
The results come as the company works to complete an all-stock merger agreement with LCI Industries, signed by the two companies on June 30, 2026. The S-4 registration statement became effective on October 19, and Patrick set a special shareholder meeting for November 18 to vote on the transaction. On October 28, Patrick reaffirmed its commitment to the agreement after LCI received an unsolicited, nonbinding offer from Monomoy Capital Partners to acquire it. Patrick said LCI had informed it of the offer and that LCI’s board had not changed its recommendation in favor of the merger with Patrick. The third-quarter results conference was scheduled online for October 29, 2026, at 10 a.m. Eastern time. PATK shares closed at $69.93 on October 28.