Drew Industries Incorporated (NYSE: DW), through its wholly-owned subsidiaries, Kinro and Lippert Components, supplies a broad array of components for recreational vehicles ("RVs") and manufactured homes. Drew's products include windows, doors, chassis, RV slide-out mechanisms, leveling devices, bath and shower units, axles, bedlifts, steps, suspension systems, ramp doors, exterior panels and specialty trailers. From 31 factories across the United States, Drew is an important supplier to most of the leading producers of RVs and manufactured homes. In 2007, RV products accounted for 74% of consolidated net sales while manufactured housing products accounted for 26%.
In 2007, Drew's net income increased 28% over the prior year despite an 8% decrease in net sales. The year-over-year decrease in net sales was primarily due to double-digit declines in industry sales of RVs and manufactured homes. The year-over-year increase in profits was primarily due to the success of Drew's long-standing strategy of market share growth, new product introductions, accretive acquisitions and operational efficiencies.
Drew's market share growth is measurable by the increase in Drew's average content per RV produced industry-wide, from $419 per RV in 2001 to $1,326 per RV in 2007, an increase of over 215%. Drew's content per average manufactured home increased 130% since 2001, reaching $1,754 in 2007.
To further its growth, over the last few years Drew has introduced several new products with an estimated market potential of more than $700 million, and during the fourth quarter of 2007, sales of these new products were running at an annualized rate of approximately $120 million.
Since 2000, Drew completed 12 strategic acquisitions. Drew is a disciplined and patient acquirer, focused only on accretive acquisitions to help better serve its customers. Drew remains focused on streamlining its operations and improving efficiencies, as evidenced by its 19% year-over-year increase in operating profit for 2007.
