Lazydays Holdings, Inc. Reports First Quarter 2019 Financial Results
TAMPA, Fla., May 9, 2019 /PRNewswire/ -- Lazydays Holdings, Inc. ("Lazydays" or the "Company") (NasdaqCM: LAZY) announced financial results for the first quarter ended March 31, 2019.
First Quarter Financial Results and Highlights:
-- On March 11, 2019, Lazydays announced that it will open a dealership in
Nashville, Tennessee, and has signed a dealership agreement for the
Nashville market with Grand Design RV, one of the most respected and
fastest growing recreational vehicle ("RV") brands in the industry.
Lazydays anticipates opening its Nashville dealership in early 2020,
after it builds out its new dealership. In the meantime, the Company
will serve the Nashville market through its Lazydays of Knoxville
dealership.
-- Lazydays expects to complete construction of a 30,000 square foot
state-of-the-art RV service facility adjacent to its Minnesota
dealership later this month. Upon completion of this facility, the
Company will immediately commence RV service operations at this location
in advance of the busy summer RV season.
-- Revenues for the first quarter were $173.1 million; down $4.7 million,
or 2.7%, versus 2018. Revenue from sales of recreational vehicles was
$152.6 million for the quarter, down $5.7 million, or 3.6%. RV unit
sales excluding wholesale units, were 1,974 for the quarter, down 80
units, or 3.9% versus 2018. The decline in the sale of recreational
vehicles for the quarter was partially offset by a $0.8 million increase
in finance and insurance ("F&I") revenues, as well as other revenues
including parts, accessories, and related services.
-- Gross profit, which excludes depreciation and amortization, was $36.9
million, down $2.0 million versus 2018. Gross margin declined slightly
between the two periods, from 21.9% in 2018 to 21.3% in 2019, primarily
driven by a mix shift towards new versus pre-owned unit sales.
-- Excluding transaction costs, stock-based compensation, and depreciation
and amortization, selling, general and administrative expense ("SG&A")
for the quarter was $26.5 million, down $0.1 million compared to the
prior year. Stock-based compensation and depreciation and amortization
increased $0.9 million and $1.1 million, respectively, compared to the
prior year. These non-cash expense increases stemmed from the March 15,
2018 merger between Andina Acquisition Corp. II ("Andina") and Lazy
Days' R.V. Center, Inc., which included options issued to management and
increases in tangible and intangible asset valuations. In addition,
transaction costs decreased by approximately $3.0 million compared to
the prior year as a result of the fees incurred in 2018 associated with
the merger better Andina and Lazydays R.V. Center, Inc.
-- Adjusted EBITDA, a non-GAAP financial measure, was $9.4 million for the
quarter, down $2.1 million, compared to 2018. This was primarily driven
by decreased gross profit from the decline in preowned vehicle unit
sales. The Company experienced severe weather in a number of its markets
during the quarter and believes the weather negatively impacted unit
volume in the quarter.
-- As of March 31, 2019, cash was $31.1 million, up $4.5 million from
December 31, 2018. The increase was primarily the result of cash flows
from operating activities net of Floorplan financing payoffs as we
reduced our RV inventory by approximately $23.2 million during the
quarter.
"Despite the continued difficult industry conditions in the first quarter along with severe weather in our Minnesota, Tennessee and Colorado markets, we are generally pleased with our performance," stated Mr. William Murnane, Chairman and Chief Executive Officer of Lazydays. "Notwithstanding weaker demand and lower volume, we were able to maintain our margins. Moreover, we reduced our same store RV inventory to slightly below March 2018 levels and believe our inventory is well positioned and properly balanced. We are also very pleased with our strong cash flow in the quarter."
Conference Call Information:
The Company has scheduled a conference call at 10:00AM Eastern Time on May 9, 2019 that will also be broadcast live over the internet. The call can be accessed as follows:
Via phone by dialing 1-844-343-9114 for domestic callers and 1-647-689-5132 for international callers. Please dial in and request Lazydays Holdings, Inc. First Quarter 2019 Financial Results Conference Call; also via webcast by clicking the link.
A live audio webcast of the conference call will be available online at https://www.lazydays.com/investor-relations.
A telephonic replay of the conference call will be available until May 16, 2019 and may be accessed by calling 1-800-585-8367 or 1-416-621-4642 with a conference ID number of 2840709. The webcast will be archived in the Investor Relations section of the Company's website.
ABOUT LAZYDAYS RV
Lazydays, The RV Authority®, is an iconic brand in the RV industry. Home of the world's largest recreational dealership, based on 126 acres outside of Tampa, Florida, Lazydays also has dealerships located in Tucson, Arizona; Minneapolis, Minnesota; Knoxville, Tennessee, and Loveland and Denver, Colorado. Offering the nation's largest selection of leading RV brands, Lazydays features nearly 3,000 new and pre-owned RVs, 400 service bays and two on-site campgrounds with over 700 RV campsites. Lazydays also has rental fleets in Florida and Colorado. In addition, Lazydays RV Accessories & More(TM) stores offer thousands of accessories and hard-to-find parts at dealership locations.
Since 1976, Lazydays has built a reputation for providing an outstanding customer experience with exceptional service and product expertise, along with being a preferred place to rest and recharge with other RVers. Lazydays consistently provides the best RV purchase, service, rental and ownership experience, which is why more than a half-million RVers and their families visit Lazydays every year, making it their "home away from home."
Lazydays Holdings, Inc. is a publicly listed company on the Nasdaq stock exchange under the ticker "LAZY." Additional information can be found here.
Forward?Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements describe Lazydays future plans, projections, strategies and expectations, including statements regarding Lazydays' expectations for its Minnesota and Tennessee dealerships, and are based on assumptions and involve a number of risks and uncertainties, many of which are beyond the control of Lazydays. Actual results could differ materially from those projected due to various factors, including economic conditions generally, conditions in the credit markets and changes in interest rates, conditions in the capital markets, and other factors described from time to time in Lazydays' Securities and Exchange Commission reports and filings, which are available at www.sec.gov. Forward-looking statements contained in this news release speak only as of the date of this news release, and Lazydays undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances, unless otherwise required by law.
Note on Presentation
For the three months ended March 31, 2019, the financial information presented represents the operating results of Lazydays Holdings, Inc. (labeled as "Successor" in the accompanying tables). For the three months ended March 31, 2018, the financial information presented represents the combined operating results of Lazydays Holdings, Inc. for the period from March 15, 2018 to March 31, 2018 with the operating results of Lazy Days' R.V. Center, Inc. (labeled as "Predecessor" in the accompanying tables) for the period from January 1, 2018 to March 14, 2018.
Results of Operations for the First Quarter Ended March 31, 2019 and 2018
LAZYDAYS HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollar amounts in thousands)
(Unaudited)
Successor Combined
Successor and
Predecessor
Three Months Three Months
Ended March Ended March
31, 2019 31, 2018
Revenues
New and pre-owned vehicles $152,634 $158,278
Other 20,423 19,566
Total revenue 173,057 177,844
Cost of revenues (excluding depreciation and
amortization expense)
New and pre-owned vehicles 130,870 135,171
Adjustments to LIFO reserve 247 148
Other 4,993 3,585
Total cost of revenues
(excluding depreciation and
amortization) 136,110 138,904
Gross profit (excluding depreciation and amortization) 36,947 38,940
Transaction costs 228 3,244
Depreciation and amortization expense 2,695 1,613
Stock-based compensation expense 1,514 625
Selling, general, and administrative expenses 26,452 26,561
Income from operations 6,058 6,897
Other income/expenses
(Loss)/gain on sale of property and equipment (2) 1
Interest expense (3,027) (2,704)
Total other expense (3,029) (2,703)
Income before income tax expense 3,029 4,194
Income tax expense (1,185) (1,167)
Net income $1,844 $3,027
Balance Sheets as of March 31, 2019 and December 31, 2018
LAZYDAYS HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands except for share and per share data)
As of
As of
March 31,
December 31,
2019 2018
(Unaudited)
ASSETS
Current assets
Cash $31,060 $26,603
Receivables, net of allowance for doubtful accounts of $663 and $687
at March 31, 2019 and December 31, 2018, respectively
25,688 16,967
Inventories 143,240 167,378
Income tax receivable 1,455 2,630
Prepaid expenses and other 3,049 3,166
Total current
assets 204,492 216,744
Property and equipment, net 79,615 78,043
Goodwill 36,729 36,762
Intangible assets, net 69,239 70,189
Other assets 325 358
Total assets $390,400 $402,096
LAZYDAYS HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS, CONTINUED
(Dollar amounts in thousands except for share and per share data)
As of
As of
March 31,
December 31,
2019 2018
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable, accrued expenses and other current liabilities $28,817 $22,599
Dividends payable 1,210
Floor plan notes payable, net of debt discount 123,718 143,469
Financing liability, current portion 773 714
Long-term debt, current portion 4,427 4,408
Total current liabilities 157,735 172,400
Long term liabilities
Financing liability, non-current portion, net of debt discount 61,818 60,533
Long term debt, non-current portion, net of debt discount 17,839 19,013
Deferred tax liability 18,717 18,717
Total liabilities 256,109 270,663
Commitments and Contingencies
Series A Convertible Preferred Stock; 600,000 shares, designated, 56,167 54,983
issued, and outstanding as of March 31, 2019 and December 31, 2018;
liquidation preference of $61,184 and $61,210 as of March 31, 2019
and December 31, 2018, respectively
Stockholders' Equity
Preferred Stock, $0.0001 par value; 5,000,000 shares authorized;
Common stock, $0.0001par value; 100,000,000 shares authorized;
8,471,608 shares issued and outstanding at March 31, 2019
and December 31, 2018, respectively
Additional paid-in capital 80,436 80,606
Accumulated deficit (2,312) (4,156)
Total stockholders' equity 78,124 76,450
Total liabilities and
stockholders' equity $390,400 $402,096
Non-GAAP Financial Measures
We use certain non-GAAP financial measures, such as EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin to enable us to analyze our performance and financial condition. We utilize these financial measures to manage our business on a day-to-day basis and believe that they are useful measures of performance as they reflect certain operating drivers of the business, such as sales growth, operating costs, selling and administrative expense and other operating income and expense. We believe that these supplemental measures are commonly used by analysts, investors and other interested parties to evaluate companies in our industry. We believe these non-GAAP measures provide expanded insight of the underlying operating results and trends and overall understanding of our financial performance and prospects for the future. The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
Our use of EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin may not be comparable to other companies within the industry due to different methods of calculation. We compensate for these limitations by using each of EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin as only one of several measures for evaluating our business performance. In addition, capital expenditures, which impact depreciation and amortization, interest expense, and income tax expense, are reviewed separately by management. We may incur expenses in the future that are the same or similar to some of those adjusted in this presentation.
EBITDA is defined as net income excluding depreciation and amortization of property and equipment, interest expense, net, amortization of intangible assets, and income tax expense.
Adjusted EBITDA is defined as net income excluding depreciation and amortization of property and equipment, non-floor plan interest expense, amortization of intangible assets, income tax expense, stock-based compensation, transaction costs and other supplemental adjustments which for the periods presented includes LIFO adjustments, severance costs and other one time charges, and loss or gain on sale of property and equipment.
Adjusted EBITDA Margin is defined as Adjusted EBITDA as a percentage of total revenues.
Reconciliations from Net Income per the Consolidated Statements of Income to EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin for the three months ended March 31, 2019 and 2018 are shown in the tables below.
Successor
Combined Successor
and Predecessor
Three Months Ended March 31,
2019 2018
EBITDA and Adjusted EBITDA
Net income $1,844 $3,027
Interest expense, net 3,027 2,704
Depreciation and amortization of property and equipment 1,741 1,327
Amortization of intangible assets 954 286
Income tax expense 1,185 1,167
Subtotal EBITDA 8,751 8,511
Floor plan interest (1,469) (1,031)
LIFO adjustment 247 148
Transaction costs 228 3,244
Loss/(gain) on sale of property and equipment 2 (1)
Severance costs/Other 157
Stock-based compensation 1,514 625
Adjusted EBITDA $9,430 $11,496
Successor
Combined Successor
and Predecessor
Three Months Ended March 31,
2019 2018
EBITDA margin and Adjusted EBITDA Margin
Net income margin 1.1% 1.7%
Interest expense, net 1.7% 1.5%
Depreciation and amortization of property and equipment 1.0% 0.7%
Amortization of intangible assets 0.6% 0.2%
Income tax expense 0.7% 0.7%
Subtotal EBITDA margin 5.1% 4.8%
Floor plan interest -0.8% -0.6%
LIFO adjustment 0.1% 0.1%
Transaction costs 0.1% 1.8%
Loss/(gain) on sale of property and equipment 0.0% 0.0%
Severance costs/Other 0.1% 0.0%
Stock-based compensation 0.9% 0.4%
Adjusted EBITDA margin 5.4% 6.5%
Note: Figures in the table may not recalculate exactly due to rounding.
News Contact:
+1 (813) 204-4099
investors@lazydays.com
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SOURCE Lazydays Holdings, Inc.
