LAZYDAYS REPORTS THIRD QUARTER 2022 FINANCIAL RESULTS

News provided by

Lazydays Holdings, Inc.

Nov 03, 2022, 08:00 ET

TAMPA, Fla., Nov. 3, 2022 /PRNewswire/ -- Lazydays (NasdaqCM: LAZY) today reported financial results for the third quarter ended September 30, 2022.

Third quarter revenue increased to $333.8 million from $318.7 million in the third quarter of 2021.

Third quarter 2022 net income per diluted share was $0.35 compared to $1.16 in the third quarter of 2021. Adjusted third quarter 2022 net income per diluted share was $0.54 compared to $1.16 for the same period in 2021. Third quarter net income for the quarter was $7.7 million, compared to $31.0 million in the third quarter of 2021. Third quarter 2022 adjusted net income was $11.1 million, compared to $28.8 million for the same period in 2021.

As shown in the attached non-GAAP reconciliation tables, the 2022 third quarter adjusted results exclude a net non-core charge of $0.19 related to the effects of our LIFO adjustment, changes in fair value of warrant liabilities, and certain compliance, legal and executive transition costs. Net non-core charges had no impact on 2021 per share third quarter adjusted results.

Corporate Development

In July 2022 we acquired Dave's Claremore RV in Tulsa, Oklahoma. In October 2022 we added sales operations to our existing service store in Houston, Texas. We estimate these locations will add anticipated annual revenues of over $60 million. With these additions, we operate 18 stores across the United States.

Balance Sheet Update and Share Repurchases 

We ended the third quarter with $100.8 million in cash and $61.7 million in availability under our credit facility. Additionally, approximately $20 million of our real estate is currently unfinanced, which we estimate could provide $15 million in capital, for total potential liquidity of $177.5 million.

Year to date through November 3, 2022, we have deployed $44.3 million to repurchase approximately 2.7 million shares of common stock at a weighted average price of $16.54 per share. This represents 18.6% of shares outstanding. Under our existing repurchase authorization, approximately $13.7 million remains available.

Leadership Updates

As previously announced, John North was named Chief Executive Officer on September 6, 2022. Nick Tomashot announced his intention to resign as Chief Financial Officer effective November 15, 2022. He will remain as an advisor through October 31, 2023.

Kelly Porter joined Lazydays on October 31, 2022. She will assume the role of Chief Financial Officer upon the resignation of Mr. Tomashot. In connection with the commencement her service, Lazydays granted Ms. Porter a restricted stock unit award covering 55,762 shares of common stock. This award was granted as an inducement material to Ms. Porter becoming a new employee in accordance with The Nasdaq Stock Market Listing Rule 5635(c)(4).  This restricted stock unit award will vest over three years, with one-third of the award vesting annually on October 31, 2023, 2024 and 2025.

Conference Call Information:

The Company has scheduled a conference call at 10:00 AM Eastern Time on Thursday, November 3, 2022 that will also be broadcast live over the internet.

The conference call may be accessed by telephone at (888) 440-6203 using Conference ID 1488544.  To listen live on our website or for replay, visit https://www.lazydays.com/investor-relations.

ABOUT LAZYDAYS RV

As an iconic brand in the RV industry, Lazydays, The RV Authority, consistently provides the best RV sales, service, and ownership experience, which is why RVers and their families become Customers for Life. Lazydays continues to add locations at a rapid pace as it executes its geographic expansion strategy that includes both acquisitions and greenfields.

Since 1976, Lazydays RV has built a reputation for providing an outstanding customer experience with exceptional service excellence and unparalleled product expertise, along with being a preferred place to rest and recharge with other RVers. By offering the largest selection of RV brands from the nation's leading manufacturers, state-of-the-art service facilities, and thousands of accessories and hard-to-find parts, Lazydays RV provides everything RVers need and want.

Lazydays Holdings, Inc. is a publicly listed company on the Nasdaq stock exchange under the ticker "LAZY."

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 acquisitions 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 ability to improve store performance;
  • Anticipated acquisition opportunities and additions of dealership locations to our portfolio in the future, and our ability to improve earnings and achieve returns on investments;
  • Anticipated revenues from acquired and open point stores; and
  • Anticipated availability of liquidity from our credit facility and unfinanced operating real estate.

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 available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms), acts of God or other incidents which may adversely impact our operations and financial performance, government regulations, legislation and others set forth throughout "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and in "Part I, Item 1A. Risk Factors" of our most recent Annual Report on Form 10-K, and 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 presentation contains non-GAAP financial measures such as adjusted net income and diluted earnings per share, adjusted SG&A as a percentage of revenue and gross profit, adjusted operating margin, adjusted operating profit as a percentage of revenue and gross profit, adjusted pre-tax margin and net profit margin, EBITDA, adjusted EBITDA, leveraged EBITDA and adjusted total debt. 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, but also to consider them with the most directly comparable GAAP measures. We present cash flows from operations in the attached 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.

Contact:
Angela Johnson
+1 (813) 204-4099
[email protected]

Results of Operations 













(Dollar amounts in thousands except for share and per share data)
























For the Three Months Ended
September 30


%
Increase


For the Nine Months Ended
September 30,


%
Increase




2022


2021


(Decrease)


2022


2021


(Decrease)

Revenues














New vehicle retail


$    203,456


$    181,395


12.2 %


$    640,078


$    550,366


16.3 %

Pre-owned vehicle retail


90,725


101,189


(10.3 %)


319,655


260,592


22.7 %

Vehicle wholesale


6,622


3,197


107.1 %


18,850


9,917


90.1 %

Finance and insurance


18,574


20,130


(7.7 %)


61,591


54,476


13.1 %

Service, body and parts, other


14,381


12,817


12.2 %


43,297


37,161


16.5 %

Total revenues



333,758


318,728


4.7 %


1,083,471


912,512


18.7 %















Cost of sales













    New vehicle 



169,447


144,220


17.5 %


517,161


446,746


15.8 %

    Pre-owned vehicle


70,468


74,526


(5.4 %)


242,378


194,424


24.7 %

    Vehicle wholesale


6,812


3,085


120.8 %


19,226


9,391


104.7 %

    Finance and insurance


681


611


11.5 %


2,227


1,795


24.1 %

    Service, body and parts, other


6,603


6,678


(1.1 %)


19,932


18,152


9.8 %

    LIFO



3,904


(655)


NM


8,230


1,409


NM

Total cost of sales


257,915


228,465


12.9 %


809,154


671,917


20.4 %















Depreciation and amortization


4,202


3,717


13.0 %


12,338


10,276


20.1 %

Selling, general, and administrative expenses


55,820


48,407


15.3 %


174,569


132,452


31.8 %

Income from operations


15,821


38,139


(58.5 %)


87,410


97,867


(10.7 %)

Other income/expenses













PPP loan forgiveness


-


-




-


6,626


(100.0 %)

Interest expense


(4,603)


(2,006)


129.5 %


(10,900)


(5,733)


90.1 %

Change in fair value of warrant liabilities


(521)


2,162


(124.1 %)


10,671


(11,090)


(196.2 %)

Inducement Loss on Warrant Conversion


-


-




-


(246)


(100.0 %)

Total other income (expense)


(5,124)


156


NM


(229)


(10,443)


NM

Income before income tax expense


10,697


38,295


(72.1 %)


87,181


87,424


(0.3 %)

Income tax expense


(3,032)


(7,326)


(58.6 %)


(19,388)


(22,299)


(13.1 %)

Net income 



$        7,665


$      30,969


(75.2 %)


$      67,793


$      65,125


4.1 %

Dividends on Series A Convertible Preferred Stock


(1,210)


(1,210)


0.0 %


(3,590)


(3,591)


(0.0 %)

Net income attributable to common stock and participating securities


$        6,455


$      29,759


(78.3 %)


$      64,203


$      61,534


4.3 %















EPS:














Basic



$          0.38


$          1.69


(77.5 %)


$          3.57


$          3.58


(0.3 %)

Diluted



$          0.35


$          1.16


(69.8 %)


$          2.39


$          2.90


(17.6 %)

Weighted average shares outstanding:












Basic



11,132,317


11,556,423


(3.7 %)


11,930,649


11,146,020


7.0 %

Diluted



11,883,985


14,924,531


(20.4 %)


13,351,591


13,774,331


(3.1 %)















NM - Not meaningful















Total Results Summary













Three Months Ended


%


Nine months ended


%


September 30


Increase


September 30


Increase


2022


2021


(Decrease)


2022


2021


(Decrease)

Gross Margin












New Vehicle Retail

16.7 %


20.5 %


(378)  bps


19.2 %


18.8 %


38   bps

Pre-Owned Vehicle Retail

22.3 %


26.3 %


(402)


24.2 %


25.4 %


(122)

Vehicle Wholesale

(2.9 %)


3.5 %


(637)


(2.0 %)


5.3 %


(730)

Finance & Insurance

96.4 %


97.0 %


(61)


96.4 %


96.7 %


(30)

Service, Body & Parts

54.1 %


47.9 %


617


54.0 %


51.2 %


280

Total Gross Margin

22.7 %


28.3 %


(560)


25.3 %


26.4 %


(105)

Total Gross Margin (Ex-LIFO)

23.9 %


28.1 %


(422)


26.1 %


26.5 %


(44)













Unit Sales












New Vehicle Retail

2,377


2,192


8.4 %


7,103


7,097


0.1 %

Used Vehicle Retail

1,335


1,417


(5.8 %)


4,410


3,917


12.6 %

Total Retail Units Sold

3,712


3,609


2.9 %


11,512


11,010


4.6 %













Average Selling Price












New Vehicle Retail

$85,594


$82,753


3.4 %


$90,126


$77,571


16.2 %

Used Vehicle Retail

67,959


71,411


(4.8 %)


72,484


66,562


8.9 %













Average Gross Profit Per Unit (ex-LIFO)












New Vehicle Retail

$14,308


$16,959


(15.6 %)


$17,307


$14,604


18.5 %

Used Vehicle Retail

15,174


18,816


(19.4 %)


17,523


16,901


3.7 %

Finance and Insurance

4,820


5,408


(10.9 %)


5,157


4,785


7.8 %

Total Vehicle Retail

19,388


23,128


(16.2 %)


22,514


20,254


11.2 %













Revenue Mix












New Vehicle Retail

61.0 %


56.9 %




59.1 %


60.3 %



Pre-Owned Vehicle Retail

27.2 %


31.7 %




29.5 %


28.6 %



Vehicle Wholesale

2.0 %


1.0 %




1.7 %


1.1 %



Finance & Insurance

5.6 %


6.3 %




5.7 %


6.0 %



Service, Body & Parts, Other

4.2 %


4.1 %




4.0 %


4.0 %




100.0 %


100.0 %




100.0 %


100.0 %















Gross Profit Mix












New Vehicle Retail

44.8 %


41.2 %




44.8 %


43.1 %



Pre-Owned Vehicle Retail

26.7 %


29.5 %




28.2 %


27.5 %



Vehicle Wholesale

(0.3 %)


0.1 %




(0.1 %)


0.2 %



Finance & Insurance

23.6 %


21.6 %




21.6 %


21.9 %



Service, Body & Parts, Other

10.3 %


6.8 %




8.5 %


7.9 %



LIFO

(5.1 %)


0.8 %




(3.0 %)


(0.6 %)




100.0 %


100.0 %




100.0 %


100.0 %















Other Metrics



















Adjusted


As Reported


Adjusted


As Reported



Three months ended
September 30,


Three months ended
September 30,


Nine months ended
September 30,


Nine months ended
September 30,



2022


2021


2022


2021


2022


2021


2022


2021

SG&A as a % of revenue


17 %


15 %


16 %


15 %


16 %


14 %


16 %


14 %


















SG&A as a % of gross profit 


73 %


53 %


73 %


53 %


63 %


54 %


63 %


54 %


















Operating income as a % of revenue


6 %


12 %


5 %


12 %


9 %


11 %


8 %


11 %


















Operating income as a % of gross profit


25 %


43 %


21 %


42 %


35 %


42 %


32 %


41 %


















Pre-tax income as a % of revenue


4 %


12 %


3 %


12 %


8 %


10 %


8 %


10 %


















Net income as a % of revenue


3 %


9 %


2 %


10 %


6 %


8 %


6 %


7 %






























Same-Store Results Summary













Three months ended


%


Nine months ended


%


September 30


Increase


September 30


Increase


2022


2021


(Decrease)


2022


2021


(Decrease)

Revenue












New Vehicle Retail

$183.8


$181.4


1.3 %


$550.9


$550.4


0.1 %

Pre-Owned Vehicle Retail

83.3


101.2


(17.7 %)


289.0


260.6


10.9 %

Vehicle Wholesale

6.2


3.2


93.5 %


17.4


9.9


75.7 %

Finance & Insurance

17.0


20.1


(15.5 %)


54.2


54.5


(0.5 %)

Service, Body & Parts, Other

13.3


12.8


3.5 %


38.0


37.2


2.4 %

Total Revenue

303.5


318.7


(4.8 %)


949.5


912.5


4.1 %













Gross Profit












New Vehicle Retail

$30.4


$37.2


(18.2 %)


$103.6


$103.6


(0.0 %)

Pre-Owned Vehicle Retail

18.3


26.7


(31.3 %)


68.4


66.2


3.3 %

Vehicle Wholesale

(0.2)


0.1


NM


(0.4)


0.5


NM

Finance & Insurance

16.4


19.5


(15.9 %)


52.3


52.7


(0.7 %)

Service, Body & Parts, Other

7.2


6.1


17.8 %


20.7


19.0


8.8 %

LIFO

(3.9)


0.7


NM


(8.2)


(1.4)


NM

Total Gross Profit

68.3


90.3


(24.4 %)


236.3


240.6


(1.8 %)













Gross Margin












New Vehicle Retail

16.5 %


20.5 %


(395) bps


18.8 %


18.8 %


(2) bps

Pre-Owned Vehicle Retail

22.0 %


26.3 %


(435)


23.7 %


25.4 %


(173)

Vehicle Wholesale

(3.2 %)


3.5 %


(668)


(2.3 %)


5.3 %


(759)

Finance & Insurance

96.5 %


97.0 %


(43)


96.5 %


96.7 %


(18)

Service, Body & Parts

54.5 %


47.9 %


666


54.4 %


51.2 %


324

Total Gross Margin

22.5 %


28.3 %


(582)


24.9 %


26.4 %


(148)

Total Gross Margin (Ex-LIFO)

23.8 %


28.1 %


(433)


25.8 %


26.5 %


(76)













Unit Sales












New Vehicle Retail

2,123


2,192


(3.1 %)


5,950


7,095


(16.1 %)

Used Vehicle Retail

1,212


1,417


(14.5 %)


3,900


3,915


(0.4 %)

Total Retail Units Sold

3,335


3,609


(7.6 %)


9,850


11,010


(10.5 %)













Average Selling Price












New Vehicle Retail

$86,569


$82,753


4.6 %


$92,584


$77,571


19.4 %

Used Vehicle Retail

68,718


71,411


(3.8 %)


74,093


66,562


11.3 %













Average Gross Profit Per Unit (ex-LIFO)











New Vehicle Retail

$14,319


$16,959


(15.6 %)


$17,408


$14,604


19.2 %

Used Vehicle Retail

15,118


18,816


(19.7 %)


17,532


16,901


3.7 %

Finance and Insurance

4,925


5,408


(8.9 %)


5,312


4,785


11.0 %

Total Vehicle Retail

19,475


23,128


(15.8 %)


22,728


20,254


12.2 %













NM - Not meaningful
























Other Highlights























As of



September 30, 2022


December 31, 2021


September 30, 2021








Store Count














Dealership


17


15


15

Service Center


1


1


1








Days Supply*














New vehicle inventory


136


83


91








Used vehicle inventory


109


58


89








* Days supply calculated based on current inventory levels and a 90 day historical average cost of sales level.















Financial Covenants









Requirement


As of
September 30, 2022










Fixed charge coverage ratio


Not less than 1.25 to 1


2.94 to 1










Leverage ratio


Not more than 3.0 to 1


0.21 to 1










Condensed Consolidated Balance Sheets

(Dollar amounts in thousands except for share and per share data) 












As of 


As of






September 30, 2022


December 31, 2021

Cash





$                         100,774


$                           98,120

Receivables, net

25,079


30,604

Inventories





319,436


242,906

Other current assets




9,616


4,005

Total current assets




454,905


375,635









     Property and equipment, net



145,217


120,748

     Intangible assets, net




166,958


168,118

     Other assets





29,986


33,627

Total assets





$                         797,066


$                         698,128









Floor plan notes payable, net 



290,298


192,220

Other current liabilities




58,514


74,130

Total current liabilities




348,812


266,350









Financing liability, non-current portion, net 


108,990


102,466

Long term debt, non-current portion, net 


10,924


13,684

Other current liabilities




41,231


54,519

Total liabilities





509,957


437,019









Series A Convertible Preferred Stock



54,983


54,983









Stockholders' Equity




232,126


206,126

Total liabilities and stockholders' equity



$                         797,066


$                         698,128









Condensed Statements of Cash Flows

(Dollar amounts in thousands) 





For the nine months ended
September 30, 2022


For the nine months ended
September 30, 2021






























Cash Flows From Operating Activities






Net income


$                                    67,793


$                                    65,125



Adjustments to reconcile net income to net cash






   provided by operating activities:







Stock based compensation

2,083


815




Bad debt expense

76


11




Depreciation and amortization of property and equipment

6,893


6,068




Amortization of intangible assets

5,445


4,208




Amortization of debt discount

248


178




Non-cash lease expense

131


42




Loss (gain) on sale of property and equipment

(18)


136




PPP loan forgiveness

-


(6,626)




Change in fair value of warrant liabilities

(10,671)


11,090




Inducement loss on warrant conversion

-


246



Changes in operating assets and liabilities:







Receivables

5,884


(8,770)




Inventories

(68,046)


(4,801)




Prepaid expenses and other

(1,027)


(1,229)




Income tax receivable/payable

(4,584)


2,976




Other assets

(591)


(109)




Accounts payable, accrued expenses







     and other current liabilities

(11,124)


16,872












Total Adjustments

(75,301)


21,107












Net Cash (Used In) Provided By Operating Activities

(7,508)


86,232






















For the nine months ended
September 30, 2022


For the nine months ended
September 30, 2021






















Net cash provided by operating activities






As Reported

$                                    (7,508)


$                                    86,232



  Floor plan notes payable, net

89,835


(23,995)


Adjusted



$                                    82,327


$                                    62,237


















Reconciliation of Non-GAAP Adjustments

















Three months ended


Nine months ended


September 30


September 30


2022


2021


2022


2021

Net Income

$7.7


$31.0


$67.8


$65.1

Basic Earnings per share

$0.38


$1.69


$3.57


$3.58

Fully diluted earnings per share

$0.35


$1.16


$2.39


$2.90









Adjustments (pre-tax)








LIFO Adjustment

$3.9


($0.7)


$8.2


$1.4

Transaction costs

-


0.7


0.1


1.5

PPP Loan forgiveness

-


-


-


(6.6)

Gain/(Loss) on sale of property and equipment

-


-


-


-

Loss (gain) on change in fair value of warrant liabilities *

0.5


(2.2)


(10.7)


11.1

Inducement loss on warrant conversions

-


-


-


0.2

Compliance/Legal costs/Executive Transitions

0.1


-


0.6


-

Tax impact of adjustments at effective rate

(1.1)


(0.0)


(2.0)


0.8

Net Adjustments

$3.4


($2.1)


($3.8)


$8.4









Adjusted Net Income

$11.1


$28.8


$64.0


$73.5

Basic Earnings per share

$0.58


$1.69


$3.36


$4.07

Fully diluted earnings per share

$0.54


$1.16


$2.74


$3.29









* In periods where the change in fair value of warrant liabilities is a gain, the diluted EPS calculation is not

affected by this line item
















SOURCE Lazydays Holdings, Inc.