Every evening our headlines snapshots from two major media outlets on each side of the left-right news spectrum reflects topics that influence, reflect, or move investor sentiment. In moments, you can get insights-at-a-glance. This sets the broader context for manufactured housing markets, in keeping with our mantra, “News through the lens of manufactured homes, and factory-built housing.” ©.
We begin with left-of-center CNN followed by right-of-center Fox Business. We share closing tickers and other related data courtesy of Yahoo Finance, and more. 5 to 10 minutes reading this MHProNews market report every business night could save you 30 minutes to an hour of similar reading or fact-gathering elsewhere.
Headlines from left-of-center CNN Business.
· Amazon’s winning streak comes to an end – After four quarters of record-setting gains, the company reported weaker-than-expected profits
· China is hurting the braces market. Align Technology’s stock plunges more than 25%
· Good news for the king of beer: People are drinking more
· Some of the world’s largest automakers are cutting emissions even as the US rolls back regulation
· He stole billions from investors. Now he wants a pardon
· Nissan will cut 12,500 jobs after its profits plunged 99%
· The trade war has hit 3M hard but the worst may soon be over
· Apple is buying Intel’s smartphone modem business
· 950 miles in two days. Taking an electric road trip in a Tesla
· TV viewership for Mueller hearings falls flat
· What to expect from Friday’s GDP report
· A woman is finally named to S&P 500’s last all-male board
· UFC is studying if CBD can help fighters with pain
· A CBD company now owns a big chunk of Jones Soda
· CBD product sales are booming. Now the FDA needs to weigh in
· Online retailer Thrive Market forced to stop selling CBD
· These hemp farmers are making a killing on the CBD industry
· Southwest ceasing operations at Newark airport due to 737 Max delays
· Boeing says it may shut down 737 Max production
· Boeing will take a $5 billion charge for its 737 Max troubles
· American Airlines extends flight cancellations because of Boeing’s 737 Max grounding
· Airbus about to pass Boeing to become world’s largest aircraft maker
Headlines from right-of-center Fox Business.
· USMCA IS $4B A DAY OF TRADE BETWEEN US, CANADA, MEXICO: BUSINESS GROUP
· Sanders’ 2020 campaign faces unfair labor charge, claims it retaliated against union activity
· Why US big tech probe is skipping Microsoft
· WHY PUERTO RICO GOV. RICARDO ROSSELLO RESIGNED: ISLAND’S ECONOMIC WOES
· Now that Rosselló is officially resigning on Aug. 2, here’s a look at some of the economic troubles plaguing the island.
· US recession on the horizon? When experts think it could hit
· Sanders’ 2020 campaign faces unfair labor charge, claims it retaliated against union activity
· Amtrak announces nonstop train between Washington, D.C. and New York
· Apple buying Intel’s smartphone-modem chip business in $1B deal
· WATCH: Amazon shares fall after reporting 2Q earnings
· Wall Street firms blamed for killing 1.3 million retail jobs
· Pot company CEO paid $3M tax bill in cash, report says
· The $2.8 trillion path to universal health care – and it’s not Medicare for All
· US warship sails through Taiwan Strait amid China tensions
· Kylie Jenner’s Instagram makes more money than you do
· Here’s how much New York taxpayers fleeing to Florida can save
· California company nabs unwanted Bird, Lime scooters and demands payment
· Boris Johnson will be more ‘pro-American’: Nigel Farage
· Fox News contributor Nigel Farage on Boris Johnson, U.K. relations with the U.S. and Brexit.
· Why did Mueller testimony focus on Joseph Mifsud?
· Political commentator John Solomon on the political fallout from the Mueller report and former special counsel Robert Mueller’s testimony on Capitol Hill.
· UPS CEO: China exports to US has reduced
· Amazon may lease Lord & Taylor building from WeWork as potential NYC office space, report says
· Former Microsoft COO on the DOJ scrutiny of Big Tech
· Former Microsoft COO Bob Herbold on Microsoft and the Department of Justice antitrust review of Big Tech.
· Republicans ask Trump to delay awarding $10B Pentagon cloud contract
· Trump said last week he was going to look at the contract after receiving “tremendous complaints.”
· 7-Eleven giving free AirPods with $50 orders through its app
Yahoo Finance Closing Tickers on MHProNews…
Tonight’s Business/Market/Political Impact Spotlight –
Second Quarter 2019 Financial Results
Net sales for the second quarter of 2019 increased $8.3 million, or 1%, to $613.2 million from $604.9 million in the same quarter of 2018. The increase in the second quarter was primarily attributable to acquisitions and market share gains, which was partially offset by quarter-over-quarter shipment declines in our primary markets. The Company’s revenues from the RV industry, which represented 56% of second quarter 2019 sales, decreased 13% from the second quarter of 2018, compared to a 14% decrease in RV industry wholesale unit shipments, as estimated by the Company. Revenues from the marine industry, which represented 14% of second quarter 2019 sales, increased 39% over the second quarter of 2018, while estimated marine powerboat retail unit shipments decreased by approximately 6%. Revenues from the MH industry, representing 18% of second quarter 2019 sales, increased 56% compared to the prior year, with a 3% decrease in MH industry wholesale unit shipments, as estimated by the Company, compared to the second quarter of 2018. Revenues from the industrial market, which accounted for 12% of second quarter 2019 sales and is tied primarily to residential housing, commercial construction, hospitality, and institutional furniture markets, declined 3% compared to the prior year. New housing starts in the second quarter of 2019 were down slightly compared to the prior year.
For the second quarter of 2019, Patrick reported operating income of $45.2 million, a decrease of 15%, or $7.9 million, from $53.1 million reported in the second quarter of 2018. Net income in the second quarter of 2019 was $27.4 million compared to $34.9 million in the second quarter of 2018, and net income per diluted share was $1.18 and $1.42 for the second quarter of 2019 and 2018, respectively.
Todd Cleveland, Chairman and Chief Executive Officer, said, “Our second quarter performance reflects our team’s ongoing efforts and discipline while we navigate continued aggressive dealer inventory rebalancing in the RV market sector and weather-related issues and conditions which hampered certain sectors of the marine and manufactured housing markets. Our consolidated net sales and profitability were negatively impacted in the second quarter of 2019 by the double digit decline in industry shipments, in the aggregate, in our four primary markets. Our profit margins were unfavorably impacted by certain 2018 distribution-related acquisitions that carry lower overall profit margins relative to our overall margin profile. In addition, in the short-term, we continued to carry a higher operating overhead cost structure relative to revenues in certain distribution operating units, and manufacturing overhead in certain manufacturing units, in order to be in position to respond quickly to anticipated increased demand levels as the RV dealer inventories reach equilibrium and negative weather-related conditions improve.”
“The diversification of our market portfolio positively impacted our second quarter results and helped to partially offset RV market volatility,” stated Andy Nemeth, President. “Fundamentally strong demographic and consumer trends continue to support and reinforce a solid long-term retail outlook and sentiment for all of our primary markets. We remain optimistic about RV industry shipments in anticipation of the upcoming RV dealer show season, based on the combination of sustained retail demand and lower inventory levels resulting from continued dealer inventory recalibration. Additionally, certain headwinds that negatively impacted our 2018 markets, including rising interest rates and commodity costs, have dissipated in 2019 and have the potential to be tailwinds in the long-term, positioning both our leisure lifestyle and housing and industrial markets for a strong return in the latter half of 2019 and into 2020.”
Six Months 2019 Financial Results
Net sales for the six months of 2019 increased $64.7 million or 6%, to $1.22 billion from $1.16 billion in the same period of 2018. The increase in the first six months of 2019 was primarily attributable to acquisitions and organic growth, which was partially offset by shipment declines in our primary markets. The Company’s revenues from the RV industry, which represented 56% of six months 2019 sales, decreased 12% from the first six months of 2018, compared to a 20% decrease in RV industry wholesale unit shipments, as estimated by the Company. Revenues from the marine industry, which represented 15% of six months 2019 sales, increased 64% over the first six months of 2018, while estimated marine powerboat retail unit shipments decreased by approximately 7%. Revenues from the MH industry, representing 18% of six months 2019 sales, increased 63% compared to the prior year with a decrease in MH industry wholesale unit shipments, as estimated by the Company, of approximately 8% from the first six months of 2018. Revenues from the industrial market, which accounted for 11% of six months 2019 sales, increased 1% compared to the prior year. New housing starts in the first six months of 2019 declined 4% compared to the prior year.
The Company’s RV content per wholesale unit (on a trailing twelve-month basis) for the second quarter of 2019 increased approximately 19% to an estimated $3,137 from $2,639 for the second quarter of 2018. Marine powerboat content per retail unit (on a trailing twelve-month basis) for the second quarter of 2019 increased 93% to an estimated $1,655 from $856 for the second quarter of 2018. MH content per wholesale unit (on a trailing twelve-month basis) for the second quarter of 2019 increased approximately 54% to an estimated $3,884 from $2,520 for the second quarter of 2018.
For the first six months of 2019, Patrick reported operating income of $81.1 million, a decrease of 15%, or $13.7 million, from $94.8 million reported in the first six months of 2018. Net income in the first six months of 2019 was $48.3 million compared to $64.9 million in the first six months of 2018, and net income per diluted share was $2.07 and $2.62 for the first six months of 2019 and 2018, respectively.
“Our market mix, which is now 56% RV and 44% non-RV, provides us with an attractive diversified platform to continue to execute on our operating model and invest in organic and strategic growth initiatives,” Mr. Nemeth further stated. “In addition, we plan to focus on leveraging our existing brands and expertise, customer relationships, innovation initiatives, and manufacturing capabilities to drive market share gains, and to realize operating efficiencies and execute on synergies across the organization. Our strong cash flows allow us to stay nimble and disciplined to our opportunistic capital allocation strategy and poised to continue to return value to our shareholders.”
“For the remainder of 2019, we will continue to focus on flexing our business model with our industry business environments, positioning ourselves to capitalize on the anticipated market improvement, and maximizing opportunities to support our long-term strategic growth initiatives,” Mr. Cleveland further stated. “The talent, commitment and dedication of our 8,000+ team members across our organization and our business model and operating platform, provide a solid foundation for us to effectively execute on our organizational strategic agenda.”
Total assets increased $99.7 million to $1.3 billion at June 30, 2019, from $1.2 billion at December 31, 2018, primarily reflecting the first quarter 2019 recognition of operating lease right-of-use assets associated with the Company’s adoption of the new lease accounting standard as of January 1, 2019 (totaling $82.5 million as of June 30, 2019), as well as seasonal working capital needs.
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The normal disclaimers were attached. Their financial snapshot follows.
Manufactured Housing Industry Connected Closing Equities Tickers
Some of these firms invest in manufactured housing, or are otherwise connected, but may do other forms of investing or business activities too.
· NOTE: The chart below includes the Canadian stock, ECN, which purchased Triad Financial Services.
· NOTE: Drew changed its name and trading symbol at the end of 2016 to Lippert (LCII).
Updated:
Berkshire Hathaway is the parent company to Clayton Homes, 21st Mortgage, Vanderbilt Mortgage and other factory built housing industry suppliers.
- LCI Industries, Patrick, UFPI, and LP all supply manufactured housing.
- AMG, CG and TAVFX have investments in manufactured housing related businesses.
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Submitted by Soheyla Kovach, co-managing member of LifeStyle Factory Homes, LLC and co-founder for MHProNews.com, and MHLivingNews.com.
