Good morning, ladies and gentlemen, and welcome to the Patrick Industries, Inc First Quarter 2015 Earnings Conference Call. My name is Laura, and I will be your operator for today's call. At this time, all participants are in a listen-only mode. Following the prepared remarks, we will conduct a question-and-answer session. Please note that this conference is being recorded. I will now like to turn the call over to Julie Ann Kotowski from Investor Relations. Ms. Kotowski, you may begin.

Good morning, everyone, and welcome to Patrick Industries first quarter 2015 conference call. I am Julie Ann Kotowski, Patrick's Director of Investor Relations; I'm joined on the call today by Todd Cleveland, President and CEO; and Andy Nemeth, CFO. On the call this morning, we are going to discuss our first quarter results and provide an update on our business outlook and the markets that we serve. However, before we do so it is my responsibility to inform you that certain statements made in today's conference call regarding Patrick Industries and its operations may be considered forward-looking statements under the securities laws. As a result, I must caution you that there are number of factors, many of which are beyond the company's control which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors are identified in our press releases, our Form 10-K for the year ended 2014, and in our other filings with the Securities and Exchange Commission. Also please note that certain financial numbers we may use on this call, such as adjusted net income and the related diluted earnings per share amounts are non-GAAP measures. We undertake no obligation to update these statements after this call. I would now like to turn the call over to Todd Cleveland.

Thank you, Julie Ann, and thank you all for joining us on the call today. This morning, I would like to briefly discuss the company's first quarter results for the period ending March 29, 2015, and then provide an update on the major markets we serve. Andy, will then provide specific details on our financial performance and I will conclude by providing an update on our business outlook. The first quarter of 2015 marked the continuation of improved performance for the company with increased revenues, improved profitability, and market share gains over the prior year. Our revenues in the first quarter increased 31% over the prior year, and we posted a 39% increase in our net income for diluted share in the first quarter of 2015 to $0.89 cents compared to $0.64 in 2014. The overall revenue and market share growth we experienced in the first quarter was largely attributable to a solid start to 2015 in all three of the primary end markets we serve. On the RV side of the business, the first quarter was in line with our expectations. The strong start marked the continuation of strength in the order rates that we saw in the fourth quarter of 2014 that exceeded typical season patterns matching the goals of the OEMs to level low debt facilities during that timeframe and further mitigate the risk of potential weather and transportation delays in the first quarter of 2015 in anticipation of the strong retail demand. Overall, OEM and dealer sentiments in the RV industry remained positive, and we remain bullish on the industry as a whole as we head into the height of the selling season. As it relates to the correlation between the retail and inventories overall production levels, industry reports indicates RV dealers inventory levels continue to…

Thanks Todd, and welcome everyone. I would like to review some highlights of our financial results for the first quarter 2015. Our net sales for the first quarter of 2015 increased $53 million or 31% over the prior year period to $223 million, reflecting a combination of industry, organic and acquisition growth. Specifically, the acquisitions that we completed post first quarter 2014, namely Precision Painting Group, Foremost, PolyVan Three, and Charleston; and our most recent acquisition of Better Way in the first quarter of 2015 contributed approximately $38 million to our first quarter 2015 increase in net sales. Our RV revenue base, which accounts for approximately 78% of first quarter sales, was up approximately 35% in the first quarter of 2015 over the first quarter of 2014, reflecting an 8% increase in wholesale unit shipments during the quarter, coupled with continued organic and acquisition growth. Our RV unit content on a TPM basis grew 19% from $1,364 per unit in 2014 to $1,629 per unit in 2015. Our MH revenue base, which accounts for approximately 12% of first quarter sales, increased 18% for the quarter on estimated unit shipment improvements of approximately 11%. Our content per unit continues to strengthen and show positive trending as we are well positioned for improvement in this market sector when the MH industry begins to recover. Our MH unit content on a TPM basis increased 8% for $1,599 per unit in 2014 to an estimated $1,723 per unit in 2015 reflecting additional market share gains and penetration with our existing customer base. Our industrial revenue base which accounts for the remaining 10% of first quarter sales was up approximately 23% in first quarter of 2015 over the first quarter of 2014. We are excited about the opportunities that currently exist in the industrial space…

Thanks, Andy. Overall, as I previously noted, we are pleased with the first quarter start of 2015 and are optimistic about the future of all three of the market sectors, both in the short and long term. Our team continues to be focused on meeting any challenges we face head on with a goal of always striving to provide the highest level of customer service and high quality of innovative products. In terms of our business outlook for the remainder of 2015, our execution goals continue to be focused around our organizational strategic agenda in utilizing our capital allocation strategy to increase our topline, both organically and through acquisition in generating improved operating income, net income, earnings per share and cash flow. Finally, I would like to reiterate Andy's earlier comments that we are eagerly looking forward to the continuation of our valued partnership with our bank group, not only from a structural perspective, but from a growth perspective as each of our partners has additionally capacity to support our growth needs into the foreseeable future. In addition, I believe our upcoming stock split is a vote of confidence by our Board in the ability of the management team and all our team members to continue to execute on a strategic plan and take the company forward, and continue to provide shareholder value in the form of potential liquidity to the market. This is the end of our prepared remarks. Thank you for your time today. We are now ready to take questions.

[Operator Instructions] And we have question from Daniel Moore from CJS Securities. Daniel your line is open.

Thank you and good morning.

Good morning.

Andy I apologize if you've mentioned this but the contents for per RV is up 19%, once again very strong growth. How much of that was acquired, is it all acquired or there is some organic? And then as a follow-up, you are now above $1600 per RV given the areas and markets you play, how much for additional growth do you see over the coming years?

Yes, Dan, as it relates to our content increase it's a combination of both acquisition and organics, so we're continuing to take market share, as well as certainly the acquisitions have been certainly important to increase content. And then as it relates to content in the existing products that we have, we certainly see plenty of runways still to continue to take additional content in the product lines, and so from our perspective, again, there is additional runway there as well as new products as we continue to explore acquisitions.

Very good. And then, looking at the manufactured housing side, it appears to be picking up albeit from a low base after – the last two to three years majority of acquisitions were RV focused, you know talk about where the opportunities lie going forward or are you looking more now at MH and industrial and other market opportunities for acquisitions going forward?

Sure Dan, this is Andy again. Primarily I would tell you that today we are still focused on the RV and the industrial spaces that relates to the acquisition priorities, however, that doesn't preclude us from looking at any MH acquisitions, we did see a fairly strong start to the MH industry in the first quarter of the first two months, and so as that continues to – as we hope that continues to grow, certainly that opens up additional opportunities for us to go into that space. But at this point we are still prioritizing the RV and the industrial space.

Okay. And then, just looking at balance sheet – you have given the expanded credit facility still significant headroom for further acquisitions, by our estimates leverage will be probably down below 2X based on 2015 EBITDA. To talk about your appetite for acquisitions, you're comfortable moving back up to the 2.5X to 3X range temporarily. And I think Todd you mentioned there was $250 million plus deal that you looked at, what's that sort of top end of the range of deals you will be comfortable looking at, at this stage?

Andy, why don't you take the first half of the question and I'll talk a little bit from a comfort standpoint so you can take a leverage piece.

Sure, on the leverage you're correct, we expect to be below 2X – we're below 2X at the end of the first quarter. The credit facility definitely provides additional capacity for us to continue down the strategic plan, we put that in place to allow us to continue to do those normal, I would say in the box acquisitions that we have done so far. The larger scale acquisition is something that we would look at with our partners, and as it sets in the facility and maybe even expanding the facility which is something that again we wanted to put in place a bank group that has additional opportunity to expand beyond its current limits, and this bank group certainly has that. So, it provides us a lot of flexibility continuing forward.

Yes, this is Todd. As it relates to the larger deals, we looked at a two in the RV space last year and one outside the RV space, and I think really our appetite to kind of push the leverage boundaries are specific to the product line that we see the intellectual property that they bring to the table and just where we see the products going in the future and what we can do with our relationships with our existing customer base and growth the business. So I would say, as Andy mentioned, we've got great support from our banking group through the process, and I think those particular cases they would be very supportive of helping us get to where we need to on the larger acquisition.

Okay. And lastly, Andy you have mentioned cash generation, obviously there was little late in Q1 but I think you said you expected growth on that year-over-year, any color on the outlook for 2015 will be helpful.

Yes, we anticipate full operating cash improvement. The first quarter was – we saw a very strong launch to the first quarter, thus our working capital needs were pretty significant as well, we put some pretty good drivers in places that relates to driving inventory returns and continuing to aggressively manage our inventory. So from my perspective we have just had a strong start, we ramped up but no concerns from our perspective as it relates to operating cash, we fully expect to increase operating cash flow year-over-year.

Okay. Thank you again.

Thank you.

[Operator Instructions] Alright, and we have no further questions at this time. I would like to return the presentation back over to Julie Ann Kotowski.

Thanks, Laura. We appreciate everyone for being on the call today and we look forward to talking to you again at our second quarter 2015 conference call. A replay of today's call will be archived on Patrick's website, www.patrickind.com under Investor Relations. Now I'll turn the call back over to our operator, Laura.

Thank you, ladies and gentlemen, this concludes today's conference. Thank you for participating and you may now disconnect.