A downtrend has been apparent in Mister Car Wash (MCW) lately. While the stock has lost 6.8% over the past week, it could witness a trend reversal as a hammer chart pattern was formed in its last trading session. This could mean that the bulls have been able to counteract the bears to help the stock find support.While the formation of a hammer pattern is a technical indication of nearing a bottom with potential exhaustion of selling pressure, rising optimism among Wall Street analysts about the future earni ...

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40542 | --- | --- | |----------------------------------------------------------------------------|--------------------------| ...

Mister Car Wash (MCW) reported $249.33 million in revenue for the quarter ended September 2024, representing a year-over-year increase of 6.5%. EPS of $0.09 for the same period compares to $0.08 a year ago. The reported revenue compares to the Zacks Consensus Estimate of $248.77 million, representing a surprise of +0.23%. The company delivered an EPS surprise of +12.50%, with the consensus EPS estimate being $0.08. While investors closely watch year-over-year changes in headline numbers -- revenue and earni ...

Mister Car Wash (MCW) came out with quarterly earnings of $0.09 per share, beating the Zacks Consensus Estimate of $0.08 per share. This compares to earnings of $0.08 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 12.50%. A quarter ago, it was expected that this car wash operator would post earnings of $0.09 per share when it actually produced earnings of $0.11, delivering a surprise of 22.22%. Over the last four quarters, t ...

Growth and Expansion - As of June 30, 2024, Mister Car Wash operates 491 locations, an increase from 449 locations as of June 30, 2023, representing a growth of approximately 9.4%[78] - In the first half of 2024, Mister Car Wash opened 15 greenfield locations, contributing to its growth strategy focused on expanding Express Exterior Locations[76] - The company added 42 new locations year-over-year, contributing to the growth in car wash sales and UWC membership[84] Financial Performance - Net income for the three months ended June 30, 2024, was $22.1 million, down from $27.1 million in the same period of 2023, resulting in a net income margin of 8.7%[80] - Adjusted EBITDA for the three months ended June 30, 2024, was $88.7 million, compared to $73.9 million for the same period in 2023, with an adjusted EBITDA margin of 34.8%[80] - Net revenues for the three months ended June 30, 2024, were $255,043, an increase of 8% compared to $236,894 for the same period in 2023[85] - For the six months ended June 30, 2024, net revenues were $494,226, an increase of 7% from $462,854 in the same period of 2023[93] - The company reported a net income of $22,091 for the three months ended June 30, 2024, down from $27,132 in the prior year, reflecting a net income margin of 9%[84] Membership and Sales - The number of Unlimited Wash Club (UWC) Members reached approximately 2.1 million as of June 30, 2024, reflecting a growth of about 3% from the previous year[81] - UWC sales accounted for 72% of total wash sales for the three months ended June 30, 2024, up from 69% in the same period of 2023[82] - UWC sales as a percentage of total wash sales for the six months ended June 30, 2024, were 73%, compared to 69% for the same period in 2023, indicating a growing penetration of the subscription model[82] Operating Costs and Expenses - Store operating costs for the three months ended June 30, 2024, included labor and chemical costs of $72,691, representing 29% of net revenues, a slight decrease from 30% in the prior year[86] - Other store operating expenses increased by 10% to $99,543, accounting for 39% of net revenues, driven by inflationary pressures and the addition of new locations[87] - General and administrative expenses decreased by 10% to $24,912, representing 10% of net revenues, primarily due to reduced marketing and corporate travel expenses[88] - Total costs and expenses for the three months ended June 30, 2024, were $200,043, maintaining a consistent 78% of net revenues compared to the previous year[89] Tax and Other Financial Impacts - The income tax provision for the three months ended June 30, 2024, was $12,655, a 76% increase from $7,205 in the prior year, reflecting unfavorable tax impacts from equity awards[90] - The income tax provision increased by 57% to $21.846 million for the six months ended June 30, 2024, primarily due to unfavorable income tax impacts from equity awards[98] Cash Flow and Liquidity - For the six months ended June 30, 2024, net cash provided by operating activities was $118.9 million, compared to $117.1 million for the same period in 2023, reflecting a year-over-year increase of $1.8 million[101] - Cash and cash equivalents decreased from $19.0 million as of December 31, 2023, to $3.6 million as of June 30, 2024, indicating a significant reduction in liquidity[99] - The company had $291.7 million of available borrowing capacity under its Revolving Commitment as of June 30, 2024[99] Debt and Interest Expenses - Total other expense, net increased by 3% to $36.971 million for the six months ended June 30, 2024, driven by increased interest expense of approximately $4.2 million due to higher long-term debt and interest rates[97] - General and administrative expenses rose by 5% to $54.622 million for the six months ended June 30, 2024, primarily due to $4.2 million in third-party costs related to debt refinancing[96] - As of June 30, 2024, the company had $925.0 million of variable rate debt outstanding, with a potential interest expense fluctuation of approximately $9 million for a 100 basis point change in interest rates[110]

Financial Data and Key Metrics Changes - Sales increased by 8% to $255 million in Q2 2024, with comparable store sales rising by 2.4% [4][15] - Adjusted EBITDA rose by 20% to $89 million, with the adjusted EBITDA margin increasing by 360 basis points to nearly 35% [4][16] - Adjusted net income was $37 million, translating to adjusted net income per diluted share of $0.11 [15] Business Line Data and Key Metrics Changes - The subscription business remained resilient, with the Titanium membership adoption at 20% of the member base, equating to over 400,000 members [4][13] - UWC sales accounted for 72% of total wash sales, with a net addition of 15,000 UWC members in the quarter [15] - Average Express revenue per member increased to $28.14 from $25.87 year-over-year [15] Market Data and Key Metrics Changes - Retail transactions continued to face downward pressure, with retail sales down in low double digits, although this was an improvement compared to Q1 [21][14] - The company experienced delays in new store openings, impacting revenue expectations for the year [14][53] Company Strategy and Development Direction - The company plans to continue investing in people, technology, and stores while maintaining tight control over expenses [8] - A focus on upgrading existing members to premium programs, specifically Titanium and Platinum, is prioritized [23] - The marketing strategy aims to broaden reach and drive customer acquisition through targeted campaigns [8][47] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential for retail traffic recovery, although timing remains uncertain [57] - The company anticipates that the competitive landscape will ease as fewer new units are expected in the market [57] - Guidance for full-year revenue is expected to be at the low end of the range due to store closures from Hurricane Beryl and delayed openings [18] Other Important Information - The company completed three sale-leaseback transactions for $14 million during the quarter [17] - Employee engagement survey results indicated that 85% of team members recommend the company as a great place to work [10] Q&A Session Summary Question: Retail transaction pressure and improving trends - Management confirmed that retail sales declines moderated compared to Q1, with higher average ticket prices contributing positively [21] Question: UWC member accounts in mature locations - Management noted that while new member growth has been modest, existing members are being upgraded to premium programs [23] Question: Titanium membership penetration - Titanium membership remained steady at 20%, with most members now paying full price, contributing to increased revenue per member [25] Question: Retail traffic and marketing spend - Management indicated that retail traffic growth is essential for overall membership growth, and they are focusing on targeted marketing strategies [29][47] Question: Future pricing strategy for base membership - Management acknowledged the potential for future price increases but emphasized the importance of maintaining value for customers [54] Question: Correlation between retail traffic and market share - Management stated that while there is no direct correlation, higher market share does lead to elevated average unit volumes [46]

Mister Car Wash (MCW) reported $255.04 million in revenue for the quarter ended June 2024, representing a year-over-year increase of 7.7%. EPS of $0.11 for the same period compares to $0.09 a year ago. The reported revenue represents a surprise of -0.63% over the Zacks Consensus Estimate of $256.65 million. With the consensus EPS estimate being $0.09, the EPS surprise was +22.22%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to det ...

Mister Car Wash (MCW) came out with quarterly earnings of $0.11 per share, beating the Zacks Consensus Estimate of $0.09 per share. This compares to earnings of $0.09 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 22.22%. A quarter ago, it was expected that this car wash operator would post earnings of $0.08 per share when it actually produced earnings of $0.08, delivering no surprise. Over the last four quarters, the compan ...

[Forward-Looking Statements](index=2&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section provides a cautionary note regarding forward-looking statements and their inherent uncertainties [Forward-Looking Statements](index=2&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section details forward-looking statements, emphasizing that actual results may differ due to various known and unknown risks and uncertainties - Key risks and uncertainties include **economic health decline**, **customer retention**, **competition**, **growth strategy implementation**, **supply chain disruptions**, **increased operating costs**, **personnel challenges**, **leased property liabilities**, **regulatory compliance**, **intellectual property protection**, and **stock price volatility**[11](index=11&type=chunk) [PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's unaudited condensed consolidated financial statements and management's discussion and analysis for the period [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The unaudited condensed consolidated financial statements for Q1 2024 show total assets of $2.93 billion, net revenues of $239.2 million, and a net income of $16.6 million [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $2.93 billion as of March 31, 2024, driven by property and equipment, while cash and cash equivalents decreased Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $10,701 | $19,047 | | Total current assets | $52,736 | $60,894 | | Property and equipment, net | $773,230 | $725,121 | | Goodwill | $1,134,734 | $1,134,734 | | **Total assets** | **$2,925,261** | **$2,881,536** | | **Liabilities & Equity** | | | | Total current liabilities | $174,669 | $169,561 | | Long-term portion of debt, net | $913,350 | $897,424 | | **Total liabilities** | **$1,996,537** | **$1,966,501** | | **Total stockholders' equity** | **$928,724** | **$915,035** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net revenues increased to $239.2 million in Q1 2024, but net income declined to $16.6 million due to higher costs and debt extinguishment loss Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net revenues | $239,183 | $225,960 | | Total costs and expenses | $196,638 | $180,378 | | Operating income | $42,545 | $45,582 | | Interest expense, net | $20,024 | $17,748 | | Loss on extinguishment of debt | $1,882 | - | | Net income | $16,637 | $21,136 | | Diluted EPS | $0.05 | $0.06 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow decreased to $58.0 million in Q1 2024, while investing activities used $76.9 million, and financing activities provided $10.7 million Summary of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $57,990 | $67,017 | | Net cash used in investing activities | $(76,944) | $(63,160) | | Net cash provided by financing activities | $10,652 | $894 | | **Net change in cash** | **$(8,302)** | **$4,751** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, including a March 2024 debt refinancing, a $5.2 million Employee Retention Credit, and 482 car wash locations - As of March 31, 2024, the company operated **482 car washes** in 21 states[26](index=26&type=chunk) - In March 2024, the company qualified for a **$5.2 million Employee Retention Credit (ERC)** for March 13, 2020, to December 31, 2020, recorded as 'Other income'[39](index=39&type=chunk) - In March 2024, the company refinanced its term loans with **$925 million in new commitments** maturing in March 2031, resulting in a **$1.9 million loss on extinguishment of debt**[66](index=66&type=chunk) - During Q1 2024, the company completed one sale-leaseback transaction for a car wash location, receiving **$4.9 million** and recognizing a **net gain of $1.7 million**[87](index=87&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a 5.8% revenue increase driven by UWC memberships and new locations, despite a net income decrease due to higher operating costs Key Performance Indicators | Indicator | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Location count (end of period) | 482 | 439 | | Comparable store sales growth | 0.9% | (1.6)% | | UWC Members (in thousands) | 2,112 | 2,006 | | UWC sales as a % of total wash sales | 74% | 69% | | Adjusted EBITDA ($ thousands) | $75,172 | $70,976 | - The company's growth strategy increasingly focuses on **greenfield development**, with **six new locations** opened in Q1 2024, expected to drive future unit growth[128](index=128&type=chunk) - Net revenues increased by **$13.2 million (6%)** year-over-year, primarily due to growth in **UWC Members** and the addition of **43 locations**[151](index=151&type=chunk) - General and administrative expenses rose by **23% to $29.7 million**, largely due to **$4.2 million in third-party costs** related to the March debt refinancing[155](index=155&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risks are interest rate fluctuations, with a 100-basis-point change impacting annual interest expense by approximately $9 million - The company holds **$925.0 million in variable-rate debt** under its First Lien Term Loan as of March 31, 2024[176](index=176&type=chunk) - A **100 basis point** increase or decrease in the effective interest rate would cause an approximate **$9 million change in annual interest expense**[176](index=176&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2024, with no material changes to internal controls - Management concluded that disclosure controls and procedures were **effective** as of March 31, 2024[178](index=178&type=chunk) - There were **no material changes** in internal control over financial reporting during Q1 2024[179](index=179&type=chunk) [PART II. OTHER INFORMATION](index=43&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, other information, and a list of exhibits filed with the report [Legal Proceedings](index=43&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, including a settled class action lawsuit against a subsidiary, pending final court approval - A class action lawsuit against subsidiary Prime Shine LLC in California has been **settled**, with the agreement pending final court approval, and the accrued financial amount is **not material**[182](index=182&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's 2023 Annual Report on Form 10-K - **No material changes** to the risk factors described in the 2023 Form 10-K have occurred[183](index=183&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds during the first quarter - **None**[184](index=184&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated Rule 10b5-1 trading arrangements during the first quarter of 2024 - **No directors or officers** adopted, modified, or terminated a Rule 10b5-1 trading plan during the quarter ended March 31, 2024[187](index=187&type=chunk) [Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed, including debt agreement amendments, CEO/CFO certifications, and Inline XBRL documents - The list of exhibits includes **Amendment No. 5 to the First Lien Term Loan Agreement**, **CEO and CFO certifications** pursuant to Sarbanes-Oxley Act Sections 302 and 906, and **XBRL data files**[191](index=191&type=chunk)