Good morning, ladies and gentlemen, and welcome to the Patrick Industries, Inc. Fourth Quarter 2013 Earnings Conference Call. My name is Lorraine 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 call is being recorded. I would now turn the call over to Julie Ann Kotowski from Investor Relations. Ms. Kotowski, you may begin.

Good morning, everyone, and welcome to Patrick Industries 2013 fourth quarter conference call. I am Julie Ann Kotowski, Patrick's Director of Investor Relations, and I'm joined on the call today by Todd Cleveland, President and CEO, and Andy Nemeth, CFO. As you know, we published our earnings release earlier this morning. On the call today, we are going to discuss our fourth quarter and full year 2013 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 a 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 2012, and in our other filings with the Securities and Exchange Commission. Also please note that certain financial measures 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. Copies of documents filed with the SEC may be obtained from the SEC or by visiting the Investor Relations section of our website. 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 fourth quarter and full year results for the period ending December 31, 2013. Andy will then provide specific details of our financial performance and I will conclude by providing an update on our business outlook and the major markets we serve. The Company continued to perform well during the quarter with increased revenue, improved profitability and cash flows and market share gains. On the top line, we achieved net sales of $147 million in the fourth quarter, the highest fourth quarter sales level in the Company's history, and year-to-date we reported record net sales of $595 million, an increase of $158 million or 36% from 2012. During the fourth quarter, we are pleased to report the pre-tax income more than doubled from the $3 million reported in 2012 to $8.1 million. For the full year 2013, pre-tax income increased over 82% or approximately $18 million to $39 million compared to $21 million in 2012. Our reported net income per diluted share in the fourth quarter of 2013 was $0.47 which included the impact of a 38% effective tax rate compared to $0.30 in 2012 when we benefited from the effective tax rate of zero due to the reversal of our tax valuation allowance. For the full year 2013, reported net income per diluted share was $2.23 compared to $2.64 the prior year which included a non-cash income tax credit of $0.64 per diluted share. After adjusting for these tax items and certain special items that Andy will expand on shortly, adjusted net income per diluted share was $0.47 in the fourth quarter of 2013 or an improvement of $0.24 per share from the adjusted $0.23 in the fourth quarter of 2012. For the 12 month period, adjusted net income per diluted share would have been $2.19 in 2013 versus $1.38 in 2012. Now I'll turn the call over to Andy who will provide additional comments on our financial results. Andy?

Thanks Todd. I would also like to welcome everyone to this conference call and review our financial results for the fourth quarter and 12 months of fiscal 2013. Our net sales for the fourth quarter of 2013 increased 38% over the prior year to $147 million, reflecting a combination of industry, market share and acquisition growth. Our RV revenue base was up approximately 43% in the fourth quarter of 2013 over the fourth quarter of 2012, and improving conditions and market share gains in the industrial market pushed sales levels up 57% from the 2012 quarter, while wholesale unit shipments in the MH industry improved 15%. Additionally, the acquisitions completed in 2012 and in the third quarter of 2013 were primarily RV market-based and contributed to an increase in our RV market sales concentration in both the fourth quarter and the 12 months of 2013 compared to the prior year periods. Excluding the revenue contributions of the acquisitions completed in 2012 and 2013, we estimated organic growth in the fourth quarter of 2013 at 23% or approximately $25 million of the total revenue increase which is comprised of growth resulting from market share gains of approximately 12% and growth tied to overall industry improvement of approximately 11%. The remaining revenue increase in the fourth quarter was attributable to the incremental contribution of the 2012 and 2013 acquisitions which resulted in incremental growth of approximately 15%. For the full-year 2013, our revenues finished at a record $595 million and were up $158 million or 36% from the previous year, primarily as a result of factors previously mentioned. During the fourth quarter of 2013, our gross margin grew 100 basis points to 14.7% over the 13.7% reported in 2012, reflecting the positive contribution of acquisitions, market share gains and an increase in…

Thanks Andy. Turning to our outlook for our markets, we expect to continue to see quarter-over-quarter revenue growth in 2014 from 2013 periods, exclusive of the revenue contributions of the acquisitions we completed in 2013. One of the means by which we measure growth in the RV industry is by the number of wholesale units that the industry ships to dealers. Actual RV shipments rose a healthy 13% in the fourth quarter over the prior period and 12% for the full year. More importantly, 2013 was the first year since 2007 that unit shipments exceeded 300,000. In addition, industry reports indicate that RV dealer inventory levels look to be in line with that of retail demand, and based on our conversations with the major RV OEMs, we plan to adjust the production capacity accordingly to meet the 2014 projected industry-wide growth. Given the growth experienced over the last four years in the RV industry, industry demographics, expected demand levels as well as overall economic improvement, we believe the future looks promising barring any significant unforeseen economic disruptions. We are anticipating continued strong growth in the market while taking into consideration seasonal patterns and we believe that RV dealers have the capacity to carry the initial inventory necessary to support this growth. The manufactured housing or MH market experienced 15% wholesale unit growth in the fourth quarter and 10% for the full year. While we expect continued year-over-year improvement with limited risk in the near-term and do not anticipate significant growth in this market going into 2014, we believe there is a potential for market growth at a much higher rate in the future especially given historic trends when compared to residential housing starts and pent-up demand in single-family housing. Given our nationwide geographic footprint, available capacity and our current content…

(Operator Instructions) Our first question comes from Daniel Moore from CJS Securities. Please go ahead.

Congratulations on the quarter and thanks for taking the questions. You mentioned in the prepared remarks that you expect operating expenses in 2014 to be up slightly as a percentage of revenue versus 2013. Maybe dig a little deeper into the factors that would cause that, are you referring to SG&A specifically and do you expect operating income margin to be down year-over-year or do you still see some opportunity for modest expansion?

There's really two things to that. The first piece is the acquisitions that we've done over the last couple of years have a higher concentration of SG&A but have higher margins as well than what we've historically trended. So our expectation is that we'll see some offset above the line as it relates to our gross margin offsetting the operating expense margin as well on the SG&A side. In our anticipation of the growth that we expect to see in 2014 and beyond, we have had some incremental administrative staffing. So it's more on the SG&A line than anywhere else that we expect to see some increment movement. But again, I think as we noted we expect that to be offset by the margin improvement above the line.

So not necessarily guiding for lower operating margins overall?

Correct.

Okay. And Todd, you mentioned Q1 January and February tracking a bit lower than expected but no significant impact. Are January and February tracking still up year-over-year and simply lower than your projections, just trying to reconcile those two statements?

Sure. Yes, that would be correct. I mean we obviously anticipated things to come out of the – in January here pretty strong and I think with the weather obviously has curtailed some of that production. But again, I'd say we're very pleased with kind of how things have progressed on a year-over-year basis.

Very good. And then lastly and I'll jump back in queue, you touched on this but Thor and others have announced capacity expansions, particularly in motor home side of the business. What areas might you be bumping up against some capacity constraints given growth, maybe you just detailed some of the investments that you are planning to make to increase capacity in 2014?

Sure. Most of our Midwest operations are in pretty good shape. I would say there are a couple of them in our hardwood facilities in particular where we made some initial investments, sort of pretty strong investments, actually in 2013 that has bumped up our capacity to where we feel like we need to be in order to serve our customers at the current demand levels that are projected. If we see those things, those demands increase more, we do have bottlenecks, we have plans in place that we will be able to shore up the needs pretty quickly.

Okay, and as it relates to that CapEx, you're projecting maybe up to $10 million, maybe can you just give us a quick breakdown on where you expect that spend to get?

Sure. Right now, Dan, we're looking – our covenant cap is $10 million, we're probably in the $8 million range right now, is our estimated CapEx plan for 2014.

Got it. I'll get back in queue, thank you.

Our next question comes from Scott Stember from Sidoti. Please go ahead. Scott Stember - Sidoti & Company: Could you maybe talk about some of the new products that you have introduced in 2013 that allows you to hold some of the market share gains, maybe just frame that up versus what you did in 2012, just give us a little idea of what we could expect for 2014, and this would be mostly on the RV side I guess?

Sure. With a lot of our focus, we have taken and enhanced product lines at some of our acquisitions that we've made in 2012, probably mainly the biggest thing we've done is do the expansion of our countertop operations, move from just strictly solid surface, hard surface to quartz and granite. We are making some investments into that and actually not only expanded that product line into the RV industry but also has moved it into the manufactured housing and our industrial sector. So we see some opportunities there. Going forward, our acquisition of Frontline turns into a new product line of fiberglass and we think that that's going to provide some very solid opportunities in the months and years to come. So again, we're continuing to focus on kind of I would say more along the lines of product extensions from some of our longer-term business units and then we've focused on new products and do some of our acquisitions in the last couple of years. Scott Stember - Sidoti & Company: Got you. And just dovetailing off that on the acquisition side, could you maybe just generally talk about what the acquisition pipeline looks like, just to give us an idea of what's out there?

Sure, Scott. Obviously with improving economic conditions, I would say that acquisitions and the targets out there have become less available than what they've been in the past. I think I should say it's taken a little bit more time to research things and reach out to get the pipeline as forward it's been in the past, but I definitely feel like there's adequate opportunities out there for us to continue to take advantage of in the future, and our focus has obviously been on the RV side and that again has been very strategic. I would say that a lot of our focus will probably continue to look at the RV side of things and be selective on what we bring on. I would tell you that I think our stronger efforts are going to be put on kind of the manufactured housing, residential housing products and I hope that we could take advantage of, similar to what we plan to do on the RV side. Scott Stember - Sidoti & Company: Got you. And on acquisitions, just looking from the press release, you guys said that the $42 million or $43 million worth of sales that you required in 2013, only $12 million hit in 2013, so we could assume that the remaining $30 million obviously will come through in 2014, right?

Yes, that's correct. Scott Stember - Sidoti & Company: Okay, and just last question then I'll get back in the queue, on the industrial side, up 57%, that's stronger than we've seen in the last few quarters. Could you just talk about, was there anything special or any new area like retail fixtures or anything else that kind of stood out that drove that significant pop in the quarter?

Yes, we made some good product expansion into the office furniture market, particularly in the Northeast. So we've had some good traction out there related to that that's helped to drive the industrial growth, but overall as well as Todd alluded to, our countertop expansion efforts as well have pushed into the industrial market. Scott Stember - Sidoti & Company: Got you. That's all I have. Thanks a lot, guys.

Our next question comes from Mark Cooper from Pacific Ridge Capital. Please go ahead.

Did you happen to mention the cash flow from operations, the cash flow statement number, what that's going to be for the full year? I know you gave us CapEx at $8.7 million.

We haven't published our cash flows yet and that will come through our 10-K, but over $22 million is our cash from operations.

Okay, great. Thank you.

(Operator Instructions) Our next question comes from Daniel Moore from CJS Securities. Please go ahead.

Just following up, the $30 million or so of revenue, acquired revenue that hasn't hit, I assume that based on the run rate at the time of the acquisitions, given the increase in industry shipment levels, might that be obviously higher than – could there be some upside to that number is the question?

Yes, there could. That's based on at the time of the acquisition.

Okay. And just wanted to switch gears a little bit to manufactured housing, Todd, you mentioned 'didn't see a material uplift in the market this year but obviously optimistic longer-term', there seems to be an acceleration in Q4, what are you kind of seeing going into 2014, what are your expectations and why couldn't you see a little bit more of an uptick or uplift than we've seen over the last couple of years?

I guess I would say I do believe that there is a potential for a greater uplift than maybe what we've indicated and can indicate. I'd just say that as we've come out of the recession, we've been challenged to kind of forecast. It would be too aggressive on the manufactured housing side because we've been hit down here for so long. I would tell you that the biggest thing we continue to offset, that we continue to fight are the financing piece. So if we can get some better lending or lenders can move in and support the industry, I think there's definitely opportunity for that industry to grow at a much more rapid rate than what we've seen over the last couple of years.

And the industry has been steadily regaining lost share from cycle pumps, is that something that is financing, as you mentioned the biggest obstacle, and do you expect that trend to continue?

At this point I don't know that we have any research that tells us that things are getting any better today. Obviously again being in the industry for a number of years, I would say that you'll typically see the loosening as the economy gets better and banks feeling better about the overall economy. So I personally, from my personal experience would say, yes, we're looking at the possibility of that, but again, until we see it, we're probably not going to feel it as it relates to our products and our industry.

Okay. And then the last one [for me] (ph) today, the share repurchase authorization to $20 million, obviously the stock trading up here above $40, what is the thought process in terms of being selective or if you can't find appropriate acquisition candidates in the next 6 to 12 months, do you expect to put a significant portion of that cash to work in share repurchases?

The answer is, yes, we will be looking at the stock in conjunction with our capital allocation strategy. Our priority is really around growing the business, and as we've kind of talked about we did in 2013, we picked up over 400,000 shares at just below $15. So we're going to continue to take that approach and use our capital to be able to maximize that capital allocation strategy. So I do see us in the market but as well our priorities are really to grow the business model.

Our next question comes from Kevin Dewey from Sapphire Capital. Please go ahead.

So just going back to gross margin for a minute, you guys attributed that 100 basis point increase to contribution from acquisitions, share and content gains. Can you maybe just directionally bucket that for us? I'm wondering if acquisitions are the lion's share of that increase or if there's also a significant component from the other drivers?

It's a mix of all three components. So I would tell you there's overhead absorption per share, and the acquisitions, like I alluded to, they do have higher gross margins than we've historically seen on a consolidated basis. So it's a mix of both, more so on the absorption side though for full year fiscal 2013 given the timing of the acquisitions, they really happened late in the third quarter, so there was a little bit of impact, but more so on the absorption side I would tell you was the primary driver.

Got it. Okay, that's all I had. Thanks guys.

Our next question comes from Scott Stember from Sidoti. Please go ahead. Scott Stember - Sidoti & Company: Just a follow-up question on the RV side, could you maybe talk about the opportunities within the motorized segment, particularly with that area really coming off of its lows over the last year or so, from a product development standpoint or any opportunities there?

So motorized side as you mentioned was down at pretty low levels and to see that come back is a real plus, we think it's a real plus for the industry as a whole. Our focus obviously, a lot of our operations tend to be set up for the lower – high-production low-SKU products. So as the manufactured housing – excuse me, the RV industry and particularly motorized comes back, I think there's some real opportunity to not only sell our existing products but also taking a look at some of our products that we've acquired over the last couple of years, specifically I think the opportunities for countertops, hardwood cabinet doors and fiberglass, doors on showers, those are all kind of upscale product lines for us, and as the industry comes back and it should give us an opportunity to kind of streamline things and move them into our operations with a little more efficiency for us and our customers. Scott Stember - Sidoti & Company: Got you. That's all I have. Thank you.

(Operator Instructions) We have no further questions at this time. I would like to return the presentation back over to Julie Ann Kotowski.

Thanks Lorraine. On behalf of Todd and Andy, we appreciate everyone for being on the call today and for your interest in Patrick. We look forward to another exciting year and we'll talk to you again at our first quarter earnings call. A replay of today's call will be archived on Patrick's website, www.patrickind.com, under Investor Relations. I'll now turn the call over to our operator, Lorraine.

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