TAMPA, Fla., Aug. 15, 2024 /PRNewswire/ -- Lazydays (NasdaqCM:
GORV) today reports results for the second quarter ended
June 30, 2024.
John North, Chief Executive
Officer, commented, "Our team has focused on maintaining healthy
vehicle inventory, improving F&I per unit and achieving
substantial total gross margin improvement sequentially. However,
the seasonal improvement in sales volume we had anticipated to
occur in the second quarter did not materialize. On a same-store
basis, we saw a decline in both new and used unit volume relative
to the first quarter, partially offset by significantly improved
gross profit per unit sold reflecting the benefits of the inventory
actions we took earlier this year. Our same store F&I was over
$5,300 per unit, up 6.9%, despite
average selling prices being lower by approximately 17% on a
blended basis.
We have continued to focus on maintaining our healthy inventory
position while increasing our efforts to procure more used units
directly from consumers as trade-ins on vehicle sales have been off
approximately 50% compared to our historical averages. As of today,
our new inventory is comprised of 26% model year 2025 units and 69%
model year 2024 units, with less than 140 2023 units remaining.
Also of note, over 75% of our inventory is towable product, up from
70% at the same time last year."
Commenting on operational changes since the end of the second
quarter, John stated, "Given the current unit sales volume, we have
implemented further cost reduction actions in August that should be
substantially complete by the end of September. We anticipate these
decisions will save approximately $25
million annually. We have also closed our Waller, Texas dealership, and consolidated our
retail operations from two locations to one in the Surprise, Arizona market.
While these decisions are painful, they are necessary. Despite
these two store actions, we remain enthusiastic about operating the
rest of our best-in-class locations and will continue to adjust our
expense structure as necessary to seek to match the revenue
opportunities available. We would note that we are not
contemplating, nor are we in discussions with counterparties
regarding strategic transactions involving significant store
divestitures or business combinations at this time.
As usual, I want to thank our entire team for delivering the
improvements in operating results that are within our control and
providing exceptional customer experiences as we await the market
recovery. We remain confident in the earnings power of our company
and look forward to unlocking its full potential as the industry
recovers."
Total revenue for the second quarter was $238.7 million compared to $308.4 million for the same period in 2023.
Total revenue for the six months ended June 30, 2024 was
$509.3 million compared to
$604.0 million for the same
period in 2023.
Net loss for the second quarter was $44.2 million compared to net income of
$3.6 million for the same period
in 2023. Adjusted net loss, a non-GAAP measure, was $18.4 million compared to adjusted net
income of $3.9 million for the
same period in 2023. Net loss per diluted share was $3.22 compared to net income per diluted share of
$0.12 for the same period in 2023.
Adjusted net loss per diluted share was $1.42 compared to adjusted net income per diluted
share of $0.14 for the same period in
2023.
Net loss for the six months ended June 30, 2024 as
$66.2 million compared to net
income of $3.3 million for the
same period in 2023. Adjusted net loss, a non-GAAP measure,
was $46.5 million compared to
adjusted net income of $5.1 million for the same period in 2023.
Net loss per diluted share was $4.89
compared to net income per diluted share of $0.00 for the same period in 2023. Adjusted net
loss per diluted share was $3.51
compared to adjusted net income per diluted share of $0.13 for the same period in 2023.
See Reconciliation of Non-GAAP Measures for additional details
regarding our adjusted results of operations.
Balance Sheet and Strategic Update
After the end of
the second quarter, we executed a temporary waiver related to our
required financial covenants as of June 30,
2024. This waiver was approved by 100% of the lenders in our
syndicated credit facility and provides additional runway to
negotiate an amendment to the facility.
Earlier this week, we received a nonbinding commitment from the
clients of Coliseum Capital Management to provide an additional
$5 million in capital that will be
added by increasing the mortgage loan facility we established in
December 2023. The terms of the
incremental advance are substantially similar to the terms of the
existing mortgage loan facility and require no additional
collateral to be added to the pool. In connection with the
incremental advance, it is contemplated that Lazydays will issue
warrants to clients of Coliseum Capital Management to purchase
666,667 shares of common stock at a price of $5.25 per share, subject to certain
adjustments.
The special committee of independent directors established by
our board of directors was advised by Stoel Rives LLP. Upon review,
the special committee unanimously approved the nonbinding
commitment to increase to the size of the mortgage loan facility
and related warrant issuance.
Additionally, the special committee continues to seek sources of
incremental capital from investors and has engaged Miller Buckfire, a Stifel company, to assist in
the process. While we remain open to other potential transactions
that are in the best interest of our shareholders, at the present
time we have determined the most prudent course of action is to
focus on strategic financing so that we maintain scale and gain
additional flexibility to operate the attractive platform of
dealership assets in our portfolio.
As a result of the upcoming expiration of the temporary waiver
to our credit facility, we have presented our long-term debt in
current portion as of June 30, 2024.
We note that to date our lenders have not accelerated any amounts
due or made any repayment demands beyond routine amounts required
in the normal course of business.
Kelly Porter, Chief Financial
Officer, stated, "We appreciate the continued flexibility from our
syndicated lenders, as well as the increased support we received
from Coliseum. We believe we have adequate liquidity to continue to
navigate the current macroeconomic environment."
Conference Call Information
We have scheduled a
conference call at 8:30 AM Eastern Time on
Friday, August 16, 2024 that will also be
broadcast live over the internet.
The conference call may be accessed by telephone at (877)
407-8029 / +1 (201) 689-8029. To listen live on our website or for
replay, visit https://www.lazydays.com/investor-relations.
About Lazydays
Lazydays has been a prominent player in
the RV industry since our inception in 1976, earning a stellar
reputation for delivering exceptional RV sales, service, and
ownership experiences. Our commitment to excellence has led to
enduring relationships with RVers and their families who rely on us
for all of their RV needs.
With a strategic approach to rapid expansion, we are growing our
network through both acquisitions and new builds. Our wide
selection of RV brands from top manufacturers, state-of-the-art
service facilities, and an extensive range of accessories and parts
ensure that Lazydays is the go-to destination for RV enthusiasts
seeking everything they need for their journeys on the road.
Whether you're a seasoned RVer or just starting your adventure, our
dedicated team is here to provide outstanding support and guidance,
making your RV lifestyle truly extraordinary.
Lazydays is a publicly listed company on the Nasdaq stock
exchange under the ticker "GORV."
Forward-Looking Statements
This press release includes
"forward-looking statements" within the meaning of the
"Safe-Harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Forward looking statements include statements
regarding our goals, plans, projections and guidance regarding our
financial position, results of operations, market position, pending
and potential future financing transactions and business strategy,
and often contain words such as "project," "outlook," "expect,"
"anticipate," "intend," "plan," "believe," "estimate," "may,"
"seek," "would," "should," "likely," "goal," "strategy," "future,"
"maintain," "continue," "remain," "target" or "will" and similar
references to future periods. Examples of forward-looking
statements in this press release include, among others, statements
regarding:
- Our efforts to procure more used units;
- Full year 2024 results, including anticipated cost
savings;
- Our recent history of losses and our ability to continue as a
going concern;
- The earnings power of our store base, and our unlocking of its
full earnings potential;
- Our ability to generate additional sources of financing;
and
- Our foundation to navigate the current macroeconomic
environment.
By their nature, forward-looking statements involve risks and
uncertainties because they relate to events that depend on
circumstances that may or may not occur in the future.
Forward-looking statements are not guarantees of future
performance, and our actual results of operations, financial
condition and liquidity and development of the industry in which we
operate may differ materially from those made in or suggested by
the forward-looking statements in this press release. The risks and
uncertainties that could cause actual results to differ materially
from estimated or projected results include, without limitation,
future economic and financial conditions (both nationally and
locally), changes in customer demand, our relationship with, and
the financial and operational stability of, vehicle manufacturers
and other suppliers, risks associated with our indebtedness
(including our ability to obtain further waivers or amendments to
credit agreements, the actions or inactions of our lenders,
available borrowing capacity, our compliance with financial
covenants and our ability to refinance or repay indebtedness on
terms acceptable to us), acts of God or other incidents which may
adversely impact our operations and financial performance,
government regulations, legislation and others set forth throughout
under the headers "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and "Risk Factors"
and in the notes to our financial statements, in our most recent
Quarterly Report on Form 10-Q, Annual Report on Form 10-Kand from
time to time in our other filings with the SEC. We urge you to
carefully consider this information and not place undue reliance on
forward-looking statements. We undertake no duty to update our
forward-looking statements, including our earnings outlook, which
are made as of the date of this release.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures such as
EBITDA, adjusted cash flow from operations, adjusted costs
applicable to revenue, adjusted net income (loss), adjusted net
income (loss) per diluted share, adjusted income (loss) before
income taxes, adjusted SG&A, and adjusted income (loss) from
operations. Non-GAAP measures do not have definitions under GAAP
and may be defined differently by and not comparable to similarly
titled measures used by other companies. As a result, we review any
non-GAAP financial measures in connection with a review of the most
directly comparable measures calculated in accordance with GAAP. We
caution you not to place undue reliance on such non-GAAP measures,
and also to consider them with the most directly comparable GAAP
measures. We present cash flows from operations in the following
tables, adjusted to include the change in non-trade floor plan debt
to improve the visibility of cash flows related to vehicle
financing. As required by SEC rules, we have reconciled these
measures to the most directly comparable GAAP measures in the
attachments to this release. We believe the non-GAAP financial
measures we present improve the transparency of our disclosures;
provide a meaningful presentation of our results from core business
operations, because they exclude items not related to core business
operations and other non-cash items; and improve the
period-to-period comparability of our results from core business
operations. These presentations should not be considered an
alternative to GAAP measures.
In addition, we have not reconciled our fiscal year 2024 EBITDA
or adjusted operational cash flow expectations. These are
provided on a non-GAAP basis and cannot be reconciled to the
closest GAAP measures without unreasonable effort because of the
unpredictability of the amounts and timing of events affecting the
items we exclude from non-GAAP measures.
Contact:
investors@lazydays.com
|
Results of
Operations
|
|
|
Three Months Ended
June 30,
|
Variance
|
|
(In thousands
except share and per share amounts)
|
2024
|
|
2023
|
%
|
|
Revenues
|
|
|
|
|
|
New vehicle
retail
|
$
143,333
|
|
$
182,752
|
(21.6) %
|
|
Pre-owned vehicle
retail
|
60,908
|
|
90,991
|
(33.1) %
|
|
Vehicle
wholesale
|
3,268
|
|
1,716
|
NM
|
|
Finance and
insurance
|
16,041
|
|
17,742
|
(9.6) %
|
|
Service, body and
parts and other
|
15,144
|
|
15,179
|
(0.2) %
|
|
Total
revenues
|
238,694
|
|
308,380
|
(22.6) %
|
|
Cost applicable to
revenues
|
|
|
|
|
|
New vehicle
retail
|
130,138
|
|
158,144
|
(17.7) %
|
|
Pre-owned vehicle
retail
|
49,446
|
|
72,425
|
(31.7) %
|
|
Vehicle
wholesale
|
3,597
|
|
1,685
|
NM
|
|
Finance and
insurance
|
644
|
|
810
|
(20.5) %
|
|
Service, body and
parts and other
|
7,150
|
|
7,517
|
(4.9) %
|
|
LIFO
|
315
|
|
76
|
NM
|
|
Total cost applicable
to revenues
|
191,290
|
|
240,657
|
(20.5) %
|
|
Gross profit
|
47,404
|
|
67,723
|
(30.0) %
|
|
Depreciation and
amortization
|
4,956
|
|
4,459
|
11.1 %
|
|
Selling, general, and
administrative expenses
|
50,966
|
|
50,480
|
1.0 %
|
|
(Loss) income from
operations
|
(8,518)
|
|
12,784
|
(166.6) %
|
|
Other income
(expense):
|
|
|
|
|
|
Floor plan interest
expense
|
(5,708)
|
|
(5,835)
|
(2.2) %
|
|
Other interest
expense
|
(5,837)
|
|
(2,083)
|
180.2 %
|
|
Change in fair value
of warrant liabilities
|
(337)
|
|
—
|
NM
|
|
Total other expense,
net
|
(11,882)
|
|
(7,918)
|
50.1 %
|
|
(Loss) income before
income taxes
|
(20,400)
|
|
4,866
|
NM
|
|
Income tax
expense
|
(23,821)
|
|
(1,306)
|
1,724.0 %
|
|
Net (loss)
income
|
(44,221)
|
|
3,560
|
NM
|
|
Dividends on Series A
Convertible Preferred Stock
|
(2,031)
|
|
(1,196)
|
69.8 %
|
|
Net (loss) income
and comprehensive (loss) income attributable to
common stock and participating securities
|
$
(46,252)
|
|
$
2,364
|
NM
|
|
|
|
|
|
|
(Loss) income per
share:
|
|
|
|
|
|
Basic
|
$
(3.22)
|
|
$
0.12
|
NM
|
|
Diluted
|
$
(3.22)
|
|
$
0.12
|
NM
|
|
Weighted average shares
used for EPS calculations:
|
|
|
|
|
|
Basic
|
14,374,897
|
|
14,181,659
|
|
|
Diluted
|
14,374,897
|
|
14,292,064
|
|
|
*NM - not
meaningful
|
|
|
|
|
|
Six Months Ended
June 30,
|
Variance
|
|
|
(In thousands
except share and per share amounts)
|
2024
|
|
2023
|
%
|
|
|
Revenues
|
|
|
|
|
|
|
New vehicle
retail
|
$
296,024
|
|
$
359,499
|
(17.7) %
|
|
|
Pre-owned vehicle
retail
|
140,484
|
|
175,766
|
(20.1) %
|
|
|
Vehicle
wholesale
|
9,517
|
|
3,424
|
NM
|
|
|
Finance and
insurance
|
34,370
|
|
34,623
|
(0.7) %
|
|
|
Service, body and
parts and other
|
28,885
|
|
30,724
|
(6.0) %
|
|
|
Total
revenues
|
509,280
|
|
604,036
|
(15.7) %
|
|
|
Cost applicable to
revenues
|
|
|
|
|
|
|
New vehicle
retail
|
277,193
|
|
311,475
|
(11.0) %
|
|
|
Pre-owned vehicle
retail
|
119,645
|
|
139,953
|
(14.5) %
|
|
|
Vehicle
wholesale
|
12,057
|
|
3,406
|
NM
|
|
|
Finance and
insurance
|
1,337
|
|
1,503
|
(11.0) %
|
|
|
Service, body and
parts and other
|
13,437
|
|
14,698
|
(8.6) %
|
|
|
LIFO
|
441
|
|
1,387
|
(68.2) %
|
|
|
Total cost applicable
to revenues
|
424,110
|
|
472,422
|
(10.2) %
|
|
|
Gross profit
|
85,170
|
|
131,614
|
(35.3) %
|
|
|
Depreciation and
amortization
|
10,417
|
|
8,862
|
17.5 %
|
|
|
Selling, general, and
administrative expenses
|
99,852
|
|
104,012
|
(4.0) %
|
|
|
(Loss) income from
operations
|
(25,099)
|
|
18,740
|
(233.9) %
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
Floor plan interest
expense
|
(13,384)
|
|
(11,366)
|
17.8 %
|
|
|
Other interest
expense
|
(10,360)
|
|
(3,783)
|
173.9 %
|
|
|
Change in fair value
of warrant liabilities
|
(337)
|
|
856
|
(139.4) %
|
|
|
Total other expense,
net
|
(24,081)
|
|
(14,293)
|
68.5 %
|
|
|
(Loss) income before
income taxes
|
(49,180)
|
|
4,447
|
NM
|
|
|
Income tax
expense
|
(17,021)
|
|
(1,163)
|
NM
|
|
|
Net (loss)
income
|
(66,201)
|
|
3,284
|
NM
|
|
|
Dividends on Series A
Convertible Preferred Stock
|
(4,015)
|
|
(2,380)
|
68.7 %
|
|
|
Net (loss) income
and comprehensive (loss) income attributable to
common stock and participating securities
|
$
(70,216)
|
|
$
904
|
NM
|
|
|
|
|
|
|
|
|
(Loss) income per
share:
|
|
|
|
|
|
|
Basic
|
$
(4.89)
|
|
$
0.05
|
NM
|
|
|
Diluted
|
$
(4.89)
|
|
$
—
|
NM
|
|
|
Weighted average shares
used for EPS calculations:
|
|
|
|
|
|
|
Basic
|
14,371,787
|
|
13,066,607
|
|
|
|
Diluted
|
14,371,787
|
|
13,188,135
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*NM - not
meaningful
|
|
|
|
|
|
|
|
|
|
|
Total Results
Summary
|
|
|
Three Months Ended
June 30,
|
Variance
|
|
|
2024
|
|
2023
|
|
|
Gross profit
margins
|
|
|
|
|
|
|
New vehicle
retail
|
9.2 %
|
|
13.5 %
|
(430)
|
bps
|
|
Pre-owned vehicle
retail
|
18.8 %
|
|
20.4 %
|
(160)
|
bps
|
|
Vehicle
wholesale
|
(10.1) %
|
|
1.8 %
|
NM
|
|
|
Finance and
insurance
|
96.0 %
|
|
95.4 %
|
60
|
bps
|
|
Service, body and
parts and other
|
52.8 %
|
|
50.5 %
|
230
|
bps
|
|
Total gross profit
margin
|
19.9 %
|
|
22.0 %
|
(210)
|
bps
|
|
Total gross profit
margin (excluding LIFO)
|
20.0 %
|
|
22.0 %
|
(200)
|
bps
|
|
|
|
|
|
|
|
Retail units
sold
|
|
|
|
|
|
|
New vehicle
retail
|
2,036
|
|
1,979
|
2.9 %
|
|
|
Pre-owned vehicle
retail
|
1,149
|
|
1,388
|
(17.2) %
|
|
|
Total retail units
sold
|
3,185
|
|
3,367
|
(5.4) %
|
|
|
|
|
|
|
|
|
Average selling
price per retail unit
|
|
|
|
|
|
|
New vehicle
retail
|
$
70,458
|
|
$
92,346
|
(23.7) %
|
|
|
Pre-owned vehicle
retail
|
53,009
|
|
65,555
|
(19.1) %
|
|
|
|
|
|
|
|
|
Average gross profit
per retail unit (excluding LIFO)
|
|
|
|
|
|
|
New vehicle
retail
|
$
6,412
|
|
$
12,552
|
(48.9) %
|
|
|
Pre-owned vehicle
retail
|
9,976
|
|
13,461
|
(25.9) %
|
|
|
Finance and
insurance
|
5,084
|
|
5,029
|
1.1 %
|
|
|
|
|
|
|
|
|
Revenue
mix
|
|
|
|
|
|
|
New vehicle
retail
|
60.0 %
|
|
59.3 %
|
|
|
|
Pre-owned vehicle
retail
|
25.5 %
|
|
29.5 %
|
|
|
|
Vehicle
wholesale
|
1.4 %
|
|
0.6 %
|
|
|
|
Finance and
insurance
|
6.7 %
|
|
5.8 %
|
|
|
|
Service, body and
parts and other
|
6.3 %
|
|
4.8 %
|
|
|
|
100.0 %
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
Gross profit
mix
|
|
|
|
|
|
|
New vehicle
retail
|
27.8 %
|
|
36.3 %
|
|
|
|
Pre-owned vehicle
retail
|
24.2 %
|
|
27.4 %
|
|
|
|
Vehicle
wholesale
|
(0.7) %
|
|
— %
|
|
|
|
Finance and
insurance
|
32.5 %
|
|
25.0 %
|
|
|
|
Service, body and
parts and other
|
16.9 %
|
|
11.4 %
|
|
|
|
LIFO
|
(0.7) %
|
|
(0.1) %
|
|
|
|
100.0 %
|
|
100.0 %
|
|
|
|
|
|
*NM - not
meaningful
|
|
|
|
Six Months Ended
June 30,
|
Variance
|
|
|
2024
|
|
2023
|
|
|
Gross profit
margins
|
|
|
|
|
|
|
New vehicle
retail
|
6.4 %
|
|
13.4 %
|
(700)
|
bps
|
|
Pre-owned vehicle
retail
|
14.8 %
|
|
20.4 %
|
(560)
|
bps
|
|
Vehicle
wholesale
|
(26.7) %
|
|
0.5 %
|
NM
|
|
|
Finance and
insurance
|
96.1 %
|
|
95.7 %
|
40
|
bps
|
|
Service, body and
parts and other
|
53.5 %
|
|
52.2 %
|
130
|
bps
|
|
Total gross profit
margin
|
16.7 %
|
|
21.8 %
|
(510)
|
bps
|
|
Total gross profit
margin (excluding LIFO)
|
16.8 %
|
|
22.0 %
|
(520)
|
bps
|
|
|
|
|
|
|
|
Retail units
sold
|
|
|
|
|
|
|
New vehicle
retail
|
4,091
|
|
3,959
|
3.3 %
|
|
|
Pre-owned vehicle
retail
|
2,616
|
|
2,692
|
(2.8) %
|
|
|
Total retail units
sold
|
6,707
|
|
6,651
|
0.8 %
|
|
|
|
|
|
|
|
|
Average selling
price per retail unit
|
|
|
|
|
|
|
New vehicle
retail
|
$
72,389
|
|
$
90,806
|
(20.3) %
|
|
|
Pre-owned vehicle
retail
|
53,702
|
|
65,292
|
(17.8) %
|
|
|
|
|
|
|
|
|
Average gross profit
per retail unit (excluding LIFO)
|
|
|
|
|
|
|
New vehicle
retail
|
$
4,569
|
|
$
12,189
|
(62.5) %
|
|
|
Pre-owned vehicle
retail
|
7,966
|
|
13,347
|
(40.3) %
|
|
|
Finance and
insurance
|
5,044
|
|
4,980
|
1.3 %
|
|
|
|
|
|
|
|
|
Revenue
mix
|
|
|
|
|
|
|
New vehicle
retail
|
58.1 %
|
|
59.5 %
|
|
|
|
Pre-owned vehicle
retail
|
27.6 %
|
|
29.1 %
|
|
|
|
Vehicle
wholesale
|
1.9 %
|
|
0.6 %
|
|
|
|
Finance and
insurance
|
6.7 %
|
|
5.7 %
|
|
|
|
Service, body and
parts and other
|
5.7 %
|
|
5.1 %
|
|
|
|
100.0 %
|
|
100.0 %
|
|
|
|
|
|
|
|
|
|
Gross profit
mix
|
|
|
|
|
|
|
New vehicle
retail
|
22.1 %
|
|
36.5 %
|
|
|
|
Pre-owned vehicle
retail
|
24.5 %
|
|
27.2 %
|
|
|
|
Vehicle
wholesale
|
(3.0) %
|
|
— %
|
|
|
|
Finance and
insurance
|
38.8 %
|
|
25.2 %
|
|
|
|
Service, body and
parts and other
|
18.1 %
|
|
12.2 %
|
|
|
|
LIFO
|
(0.5) %
|
|
(1.1) %
|
|
|
|
100.0 %
|
|
100.0 %
|
|
|
|
|
*NM - not
meaningful
|
|
Other
Metrics
|
|
|
Adjusted
|
|
As
Reported
|
|
Three Months Ended
June 30,
|
|
Three Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
SG&A as a % of
revenue
|
20.9 %
|
|
16.2 %
|
|
21.4 %
|
|
16.4 %
|
|
SG&A as % of gross
profit, excluding LIFO
|
104.5 %
|
|
73.7 %
|
|
106.8 %
|
|
74.5 %
|
|
(Loss) income from
operations as a % of revenue
|
(3.0) %
|
|
4.3 %
|
|
(3.6) %
|
|
4.1 %
|
|
(Loss) income from
operations as a % of gross profit, excluding LIFO
|
(14.9) %
|
|
19.7 %
|
|
(17.9) %
|
|
18.9 %
|
|
(Loss) income before
income taxes as % of revenue
|
(7.8) %
|
|
1.8 %
|
|
(8.5) %
|
|
1.6 %
|
|
Net (loss) income as a
% of revenue
|
(7.7) %
|
|
1.3 %
|
|
(18.5) %
|
|
1.2 %
|
|
Adjusted
|
|
As
Reported
|
|
Six Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2024
|
|
2023
|
|
2024
|
|
2023
|
|
SG&A as a % of
revenue
|
19.3 %
|
|
16.9 %
|
|
19.6 %
|
|
17.2 %
|
|
SG&A as % of gross
profit, excluding LIFO
|
114.6 %
|
|
76.7 %
|
|
116.6 %
|
|
78.2 %
|
|
(Loss) income from
operations as a % of revenue
|
(4.5) %
|
|
3.7 %
|
|
(4.9) %
|
|
3.1 %
|
|
(Loss) income from
operations as a % of gross profit, excluding LIFO
|
(26.8) %
|
|
16.7 %
|
|
(29.3) %
|
|
14.1 %
|
|
(Loss) income before
income taxes as % of revenue
|
(9.2) %
|
|
1.2 %
|
|
(9.7) %
|
|
0.7 %
|
|
Net (loss) income as a
% of revenue
|
(9.1) %
|
|
0.8 %
|
|
(13.0) %
|
|
0.5 %
|
|
Other
Highlights
|
|
|
June 30,
2024
|
|
December 31,
2023
|
|
Store
Count
|
|
|
|
|
Dealerships
|
25
|
|
24
|
|
|
|
|
|
Days
Supply*
|
|
|
|
|
New vehicle
inventory
|
203
|
|
380
|
|
Pre-owned vehicle
inventory
|
91
|
|
132
|
|
*Days supply calculated
based on current inventory levels and a 90-day historical average
cost of sales level.
|
|
Financial
Covenants
|
|
|
Requirement
|
|
June 30,
2024
|
|
Minimum
liquidity
|
$31,000,000
|
|
$41,370,694
|
|
Same-Store Results
Summary
|
|
|
Three Months Ended
June 30,
|
|
Variance
|
|
|
($ in thousands,
except per vehicle data)
|
2024
|
|
2023
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
120,041
|
|
$
172,156
|
|
(30.3) %
|
|
|
Pre-owned vehicle
retail
|
50,041
|
|
86,900
|
|
(42.4) %
|
|
|
Vehicle
wholesale
|
2,857
|
|
1,591
|
|
79.6 %
|
|
|
Finance and
insurance
|
13,741
|
|
16,930
|
|
(18.8) %
|
|
|
Service, body and
parts and other
|
12,617
|
|
14,371
|
|
(12.2) %
|
|
|
Total
revenues
|
$
199,297
|
|
$
291,948
|
|
(31.7) %
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
10,194
|
|
$
23,250
|
|
(56.2) %
|
|
|
Pre-owned vehicle
retail
|
9,077
|
|
17,771
|
|
(48.9) %
|
|
|
Vehicle
wholesale
|
(312)
|
|
31
|
|
NM
|
|
|
Finance and
insurance
|
13,187
|
|
16,146
|
|
(18.3) %
|
|
|
Service, body and
parts and other
|
6,530
|
|
6,883
|
|
(5.1) %
|
|
|
LIFO
|
(316)
|
|
(76)
|
|
315.8 %
|
|
|
Total gross
profit
|
$
38,360
|
|
$
64,005
|
|
(40.1) %
|
|
|
|
|
|
|
|
|
|
Gross profit
margins
|
|
|
|
|
|
|
|
New vehicle
retail
|
8.5 %
|
|
13.5 %
|
|
(500)
|
bps
|
|
Pre-owned vehicle
retail
|
18.1 %
|
|
20.4 %
|
|
(230)
|
bps
|
|
Vehicle
wholesale
|
(10.9) %
|
|
1.9 %
|
|
NM
|
|
|
Finance and
insurance
|
96.0 %
|
|
95.4 %
|
|
60
|
bps
|
|
Service, body and
parts and other
|
51.8 %
|
|
47.9 %
|
|
390
|
bps
|
|
Total gross profit
margin
|
19.2 %
|
|
21.9 %
|
|
(270)
|
bps
|
|
Total gross profit
margin (excluding LIFO)
|
19.4 %
|
|
21.9 %
|
|
(250)
|
bps
|
|
|
|
|
|
|
|
|
Retail units
sold
|
|
|
|
|
|
|
|
New vehicle
retail
|
1,556
|
|
1,834
|
|
(15.2) %
|
|
|
Pre-owned vehicle
retail
|
901
|
|
1,300
|
|
(30.7) %
|
|
|
Total retail units
sold
|
2,457
|
|
3,134
|
|
(21.6) %
|
|
|
|
|
|
|
|
|
|
Average selling
price per retail unit
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
77,147
|
|
$
93,580
|
|
(17.6) %
|
|
|
Pre-owned vehicle
retail
|
55,539
|
|
66,342
|
|
(16.3) %
|
|
|
|
|
|
|
|
|
|
Average gross profit
per retail unit (excluding LIFO)
|
|
|
|
|
|
|
New vehicle
retail
|
$
6,552
|
|
$
12,744
|
|
(48.6) %
|
|
|
Pre-owned vehicle
retail
|
10,075
|
|
13,566
|
|
(25.7) %
|
|
|
Finance and
insurance
|
5,367
|
|
5,020
|
|
6.9 %
|
|
|
|
|
|
|
|
|
|
*NM - not
meaningful
|
|
|
Six Months Ended
June 30,
|
|
Variance
|
|
|
(In thousands,
except per vehicle data)
|
2024
|
|
2023
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
250,866
|
|
$
341,930
|
|
(26.6) %
|
|
|
Pre-owned vehicle
retail
|
116,756
|
|
168,425
|
|
(30.7) %
|
|
|
Vehicle
wholesale
|
7,903
|
|
3,249
|
|
143.2 %
|
|
|
Finance and
insurance
|
29,280
|
|
33,283
|
|
(12.0) %
|
|
|
Service, body and
parts and other
|
24,482
|
|
29,136
|
|
(16.0) %
|
|
|
Total
revenues
|
$
429,287
|
|
$
576,023
|
|
(25.5) %
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
15,091
|
|
$
45,730
|
|
(67.0) %
|
|
|
Pre-owned vehicle
retail
|
16,806
|
|
34,328
|
|
(51.0) %
|
|
|
Vehicle
wholesale
|
(1,838)
|
|
15
|
|
NM
|
|
|
Finance and
insurance
|
28,120
|
|
31,827
|
|
(11.6) %
|
|
|
Service, body and
parts and other
|
13,039
|
|
14,882
|
|
(12.4) %
|
|
|
LIFO
|
(441)
|
|
(1,387)
|
|
(68.2) %
|
|
|
Total gross
profit
|
$
70,777
|
|
$
125,395
|
|
(43.6) %
|
|
|
|
|
|
|
|
|
|
Gross profit
margins
|
|
|
|
|
|
|
|
New vehicle
retail
|
6.0 %
|
|
13.4 %
|
|
(740)
|
bps
|
|
Pre-owned vehicle
retail
|
14.4 %
|
|
20.4 %
|
|
(600)
|
bps
|
|
Vehicle
wholesale
|
(23.3) %
|
|
0.5 %
|
|
NM
|
|
|
Finance and
insurance
|
96.0 %
|
|
95.6 %
|
|
40
|
bps
|
|
Service, body and
parts and other
|
53.3 %
|
|
51.1 %
|
|
220
|
bps
|
|
Total gross profit
margin
|
16.5 %
|
|
21.8 %
|
|
(530)
|
bps
|
|
Total gross profit
margin (excluding LIFO)
|
16.6 %
|
|
22.0 %
|
|
(540)
|
bps
|
|
|
|
|
|
|
|
|
Retail units
sold
|
|
|
|
|
|
|
|
New vehicle
retail
|
3,192
|
|
3,707
|
|
(13.9) %
|
|
|
Pre-owned vehicle
retail
|
2,092
|
|
2,530
|
|
(17.3) %
|
|
|
Total retail units
sold
|
5,284
|
|
6,237
|
|
(15.3) %
|
|
|
|
|
|
|
|
|
|
Average selling
price per retail unit
|
|
|
|
|
|
|
|
New vehicle
retail
|
$
78,592
|
|
$
92,406
|
|
(14.9) %
|
|
|
Pre-owned vehicle
retail
|
55,811
|
|
66,016
|
|
(15.5) %
|
|
|
|
|
|
|
|
|
|
Average gross profit
per retail unit (excluding LIFO)
|
|
|
|
|
|
|
New vehicle
retail
|
$
4,728
|
|
$
12,438
|
|
(62.0) %
|
|
|
Pre-owned vehicle
retail
|
8,033
|
|
13,465
|
|
(40.3) %
|
|
|
Finance and
insurance
|
5,322
|
|
5,013
|
|
6.2 %
|
|
|
|
|
|
|
|
|
|
*NM - not
meaningful
|
|
Condensed
Consolidated Balance Sheets
|
|
|
(In
thousands)
|
June 30,
2024
|
|
December 31,
2023
|
|
Current
assets
|
|
|
|
|
Cash
|
$
42,022
|
|
$
58,085
|
|
Receivables, net of
allowance for doubtful accounts
|
28,806
|
|
22,694
|
|
Inventories
|
314,382
|
|
456,087
|
|
Income tax
receivable
|
6,675
|
|
7,416
|
|
Prepaid expenses and
other
|
4,907
|
|
2,614
|
|
Total current
assets
|
396,792
|
|
546,896
|
|
|
|
|
|
Long-term
assets
|
|
|
|
|
Property and
equipment, net
|
272,297
|
|
265,726
|
|
Operating lease
assets
|
23,629
|
|
26,377
|
|
Intangible assets,
net
|
76,477
|
|
80,546
|
|
Other
assets
|
3,173
|
|
2,750
|
|
Deferred income tax
asset
|
—
|
|
15,444
|
|
Total
assets
|
$
772,368
|
|
$
937,739
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Floor plan notes
payable
|
$
330,967
|
|
$
446,783
|
|
Revolving line of
credit, current portion
|
44,500
|
|
—
|
|
Other current
liabilities
|
131,083
|
|
53,194
|
|
Total current
liabilities
|
506,550
|
|
499,977
|
|
|
|
|
|
Long-term
liabilities
|
|
|
|
|
Financing liability,
non-current portion, net
|
91,509
|
|
91,401
|
|
Revolving line of
credit, non-current portion
|
—
|
|
49,500
|
|
Long-term debt,
non-current portion, net
|
—
|
|
28,075
|
|
Related party debt,
non-current portion, net
|
—
|
|
33,354
|
|
Warrant
liabilities
|
5,244
|
|
—
|
|
Other long-term
liabilities
|
20,859
|
|
22,242
|
|
Total
liabilities
|
624,162
|
|
724,549
|
|
|
|
|
|
Series A Convertible
Preferred Stock
|
60,208
|
|
56,193
|
|
Stockholders'
Equity
|
87,998
|
|
156,997
|
|
Total liabilities
and stockholders' equity
|
$
772,368
|
|
$
937,739
|
|
Future maturities of
long-term debt are as follows:
|
|
(In
thousands)
|
|
|
Remainder of
2024
|
$
5,578
|
|
2025
|
771
|
|
2026
|
45,326
|
|
2027
|
886
|
|
2028
|
950
|
|
Thereafter
|
20,358
|
|
Total
|
$
73,869
|
|
|
The above schedule
reflects contractual maturities, but for financial reporting,
long-term debt, and related party debt have
been classified as current as described in Note 2 and Note 7 to the
Condensed Consolidated Financial Statements.
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
|
Six Months Ended
June 30,
|
|
(In
thousands)
|
2024
|
|
2023
|
|
Operating
Activities
|
|
|
|
|
Net (loss)
income
|
$
(66,201)
|
|
$
3,284
|
|
Adjustments to
reconcile net (loss) income to net cash provided by operating
activities:
|
|
|
|
|
Stock-based
compensation
|
1,104
|
|
1,639
|
|
Bad debt
expense
|
76
|
|
9
|
|
Depreciation and
amortization of property and equipment
|
6,346
|
|
5,195
|
|
Amortization of
intangible assets
|
4,070
|
|
3,667
|
|
Amortization of debt
discount
|
506
|
|
655
|
|
Non-cash operating
lease (benefit) expense
|
(217)
|
|
93
|
|
Gain on sale of
property and equipment
|
(2,950)
|
|
—
|
|
Deferred income
taxes
|
16,375
|
|
(147)
|
|
Change in fair value
of warrant liabilities
|
337
|
|
(856)
|
|
Impairment
charges
|
—
|
|
538
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Receivables
|
(6,188)
|
|
(3,424)
|
|
Inventories
|
141,705
|
|
(4,346)
|
|
Prepaid expenses and
other
|
(2,293)
|
|
(2,712)
|
|
Income tax
receivable/payable
|
744
|
|
1,239
|
|
Other
assets
|
(424)
|
|
(390)
|
|
Accounts
payable
|
1,920
|
|
3,744
|
|
Accrued expenses and
other current liabilities
|
6,405
|
|
2,517
|
|
Total
adjustments
|
167,516
|
|
7,421
|
|
Net cash provided
by operating activities
|
$
101,315
|
|
$
10,705
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
(In
thousands)
|
2024
|
|
2023
|
|
Net cash provided by
operating activities, as reported
|
$
101,315
|
|
$
10,705
|
|
Net repayments on floor
plan notes payable
|
(114,824)
|
|
(44,293)
|
|
Minus borrowings on
floor plan notes payable associated with acquired new
inventory
|
—
|
|
(4,271)
|
|
Plus net increase to
floor plan offset account
|
—
|
|
40,000
|
|
Net cash (used in)
provided by operating activities, as adjusted
|
$
(13,509)
|
|
$
2,141
|
|
Reconciliation of
Non-GAAP Measures
|
|
|
Three months ended
June 30, 2024
|
|
($ in thousands,
except per share amounts)
|
As
reported
|
Loss on
change in
fair value of
warrant
liabilities
|
LIFO
|
Transaction
costs
|
Severance
and
transition
costs
|
Deferred
Tax
Valuation
Allowance
|
Adjusted
|
|
Costs applicable to
revenue
|
$
191,290
|
$
—
|
$
(315)
|
$
—
|
$
—
|
$
—
|
$
190,975
|
|
Selling, general and
administrative expenses
|
50,966
|
—
|
—
|
(1,073)
|
(7)
|
—
|
49,886
|
|
(Loss) income from
operations
|
(8,518)
|
—
|
315
|
1,073
|
7
|
—
|
(7,123)
|
|
Change in fair value of
warrant liabilities
|
(337)
|
337
|
—
|
—
|
—
|
—
|
—
|
|
(Loss) income before
income taxes
|
(20,400)
|
337
|
315
|
1,073
|
7
|
—
|
(18,668)
|
|
Income tax (expense)
benefit
|
(23,821)
|
(5)
|
(5)
|
(16)
|
—
|
24,096
|
249
|
|
Net (loss)
income
|
(44,221)
|
332
|
310
|
1,057
|
7
|
24,096
|
(18,419)
|
|
Dividends on Series A
Convertible Preferred Stock
|
(2,031)
|
—
|
—
|
—
|
—
|
—
|
(2,031)
|
|
Net (loss) income and
comprehensive (loss) income attributable to
common stock and participating securities
|
$ (46,252)
|
$
332
|
$
310
|
$
1,057
|
$
7
|
$ 24,096
|
$ (20,450)
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share
|
$
(3.22)
|
|
|
|
|
|
$
(1.42)
|
|
Shares used for diluted
calculation
|
14,374,897
|
|
|
|
|
|
14,374,897
|
|
Three months ended
June 30, 2023
|
|
($ in thousands,
except per share amounts)
|
As
reported
|
LIFO
|
Transaction
costs
|
Storm
Reserve
|
Adjusted
|
|
Costs applicable to
revenue
|
$
240,657
|
$
(76)
|
$
—
|
$
—
|
$
240,581
|
|
Selling, general and
administrative expenses
|
50,480
|
—
|
(209)
|
(300)
|
49,971
|
|
Income from
operations
|
12,784
|
76
|
209
|
300
|
13,369
|
|
Income before income
taxes
|
4,866
|
76
|
209
|
300
|
5,451
|
|
Income tax
expense
|
(1,306)
|
(48)
|
(51)
|
(106)
|
(1,511)
|
|
Net income
|
3,560
|
28
|
158
|
194
|
3,940
|
|
Dividends on Series A
Convertible Preferred Stock
|
(1,196)
|
—
|
—
|
—
|
(1,196)
|
|
Net income and
comprehensive income attributable to common stock
and participating securities
|
$
2,364
|
$
28
|
$
158
|
$
194
|
$
2,744
|
|
|
|
|
|
|
|
Diluted earnings per
share
|
$
0.12
|
|
|
|
$
0.14
|
|
Shares used for diluted
calculation
|
14,292,064
|
|
|
|
14,292,064
|
|
Six months ended
June 30, 2024
|
|
($ in thousands,
except per share amounts)
|
As
reported
|
Loss on
change in
fair value of
warrant
liabilities
|
LIFO
|
Transaction
costs
|
Severance
and
transition
costs
|
Deferred Tax
Valuation
Allowance
|
Adjusted
|
|
Costs applicable to
revenue
|
$ 424,110
|
$
—
|
$
(441)
|
$
—
|
$
—
|
$
—
|
$ 423,669
|
|
Selling, general and
administrative expenses
|
99,852
|
—
|
—
|
(1,630)
|
(99)
|
—
|
98,123
|
|
(Loss) income from
operations
|
(25,099)
|
—
|
441
|
1,630
|
99
|
—
|
(22,929)
|
|
Change in fair value of
warrant liabilities
|
(337)
|
337
|
—
|
—
|
—
|
—
|
—
|
|
(Loss) income before
income taxes
|
(49,180)
|
337
|
441
|
1,630
|
99
|
—
|
(46,673)
|
|
Income tax (expense)
benefit
|
(17,021)
|
(3)
|
(5)
|
(17)
|
(1)
|
17,261
|
214
|
|
Net (loss)
income
|
(66,201)
|
334
|
436
|
1,613
|
98
|
17,261
|
(46,459)
|
|
Dividends on Series A
Convertible Preferred Stock
|
(4,015)
|
—
|
—
|
—
|
—
|
—
|
(4,015)
|
|
Net (loss) income and
comprehensive (loss) income attributable to
common stock and participating securities
|
$ (70,216)
|
$
334
|
$
436
|
$
1,613
|
$
98
|
$
17,261
|
$ (50,474)
|
|
|
|
|
|
|
|
|
|
Diluted loss per
share
|
$
(4.89)
|
|
|
|
|
|
$
(3.51)
|
|
Shares used for diluted
calculation
|
14,371,787
|
|
|
|
|
|
14,371,787
|
|
Six months ended
June 30, 2023
|
|
($ in thousands,
except per share amounts)
|
As
reported
|
Gain on
change in
fair value of
warrant
liabilities
|
LIFO
|
Transaction
costs
|
Severance
and
transition
costs
|
Impairment
charge
|
Storm
Reserve
|
Adjusted
|
|
Costs applicable to
revenue
|
$
472,422
|
$
—
|
$ (1,387)
|
$
—
|
$
—
|
$
—
|
$
—
|
$
471,035
|
|
Selling, general and
administrative expenses
|
104,012
|
—
|
—
|
(471)
|
(653)
|
(629)
|
(300)
|
101,959
|
|
Income from
operations
|
18,740
|
—
|
1,387
|
471
|
653
|
629
|
300
|
22,180
|
|
Gain on change in fair
value of warrant liabilities
|
856
|
(856)
|
—
|
—
|
—
|
—
|
—
|
—
|
|
Income before income
taxes
|
4,447
|
(856)
|
1,387
|
471
|
653
|
629
|
300
|
7,031
|
|
Income tax
expense
|
(1,163)
|
—
|
(296)
|
(101)
|
(124)
|
(119)
|
(106)
|
(1,909)
|
|
Net income
(loss)
|
3,284
|
(856)
|
1,091
|
370
|
529
|
510
|
194
|
5,122
|
|
Dividends on Series A
Convertible Preferred Stock
|
(2,380)
|
—
|
—
|
—
|
—
|
—
|
—
|
(2,380)
|
|
Net income (loss) and
comprehensive income (loss)
attributable to common stock and participating
securities
|
$
904
|
$
(856)
|
$
1,091
|
$
370
|
$
529
|
$
510
|
$
194
|
$
2,742
|
|
|
|
|
|
|
|
|
|
|
Diluted income per
share
|
$
—
|
|
|
|
|
|
|
$
0.13
|
|
Shares used for diluted
calculation
|
13,188,135
|
|
|
|
|
|
|
13,188,135
|
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SOURCE Lazydays