Lazydays Holdings(US:GORV)2020-08-01 10:48Financial Data and Key Metrics Changes - Total revenues for Q2 2020 were $214 million, an increase of $45.5 million or 26.9% compared to Q2 2019 [8] - Net income for Q2 2020 was $8.1 million, more than four times the net income of $1.9 million in Q2 2019 [14] - Earnings per share increased from $0.02 to $0.39 [14] - Adjusted EBITDA for the quarter was $14.9 million, up $5 million, setting a new quarterly record [15] Business Line Data and Key Metrics Changes - Revenue from RV sales was $191.5 million, up $42.5 million or 28.5% [8] - New RV revenue was $129.4 million, an increase of $35.2 million or 37.3% [8] - Preowned RV revenue was $62.1 million, up $7.3 million or 13.3% [8] - Revenue from other channels, including parts, accessories, and services, was $22.5 million, up $3 million or 15.2% [10] Market Data and Key Metrics Changes - Total RV unit sales were 2,950, an increase of 858 units or 41% [9] - New vehicle unit sales were 1,845, up 533 units or 40.6% [9] - Preowned vehicle unit sales were 1,105, up 325 units or 41.7% [9] - Average selling price for new vehicles was $69,500, down $1,800 or 2.5% [9] Company Strategy and Development Direction - The company is experiencing robust demand for RVs, attributed to lifestyle changes due to the pandemic [22] - Plans to open new dealerships in Phoenix and Nashville, with an acquisition of Total Value RV in Elkhart, Indiana anticipated to close in early fall [25][26] - The company aims to continue adding dealerships to its network in the coming year [26] Management's Comments on Operating Environment and Future Outlook - Management noted that demand remains strong, with July's adjusted EBITDA expected to be at least $5.2 million [23] - Inventory levels are tight but expected to normalize as production resumes [24] - The company is in a wait-and-see mode regarding procurement decisions based on market conditions [24] Other Important Information - Cash on hand at the end of Q2 2020 was $62.1 million, an increase of $30.6 million compared to December 31, 2019 [16] - Total inventory was approximately $103 million, down $60.6 million compared to the same time last year [17] Q&A Session Summary Question: What is the normal seasonality of demand? - Management indicated that typically, demand is steady across July, August, and September, but this year is unpredictable due to current conditions [32][33] Question: What demographics are driving demand? - Management noted growth across all demographics, with millennials and Gen Xers growing faster than boomers, indicating a shift towards used and lower-priced products [35] Question: What is the current state of the acquisition pipeline? - Management stated that asking prices have remained stable, and they are cautious about overpaying for acquisitions [37] Question: What are the maintenance attach rates and opportunities? - Management expects a lift in maintenance services as RV usage increases, emphasizing the importance of service in their business model [47] Question: What kind of returns are expected from dedicated service centers? - Management indicated that the return on investment for service centers should be higher than for full dealerships due to lower land requirements and higher margins [49] Question: How does the company prioritize spending on service centers versus dealerships? - Management stated that they will prioritize good dealership opportunities but can also fill gaps with service centers when necessary [51]