Camping World Sees Brisk Business in First Quarter 2024 – RVBusiness – Breaking RV Industry News
LINCOLNSHIRE, Ill. – Camping World Holdings Inc. (CWH), America’s Recreation Dealer, today reported results for the first quarter ended March 31.
Marcus Lemonis, Chairman and Chief Executive Officer of CWH stated, “Our intentional efforts to drive down invoice pricing and widen the consumer affordability funnel resulted in our new unit sales meaningfully outpacing broader RV industry trends. We drove record new unit market share for January and February. Our same store new vehicle unit volume increased double-digits in the quarter, with momentum continuing through April.”
Matt Wagner, Chief Operating Officer of CWH commented, “We have been successful in rebalancing our used inventory position and now that market pricing has stabilized, we intend to reinvest in building our stocking levels in a disciplined manner over the coming months. We continue to expect our used business to improve as we move through the balance of the year.”
Mr. Lemonis concluded, “With significant new unit volume momentum and a dominant inventory position, we believe we have laid the groundwork for improving fundamentals going forward. Our team remains laser focused on achieving our unit volume, market share, and earnings growth goals for 2024, while continuing our march to 320 locations by 2028.”
First Quarter-over-Quarter Operating Highlights
- The total number of our store locations was 215 as of March 31, 2024, an increase of 20 store locations from March 31, 2023, or 10.3%, with a net 13 store locations opened during the first quarter.
- Revenue was $1.4 billion for the first quarter, a decrease of $122.9 million, or 8.3%.
- New vehicle revenue was $656.1 million for the first quarter, an increase of $9.3 million, or 1.4%, and new vehicle unit sales were 16,882 units, an increase of 2,970 units, or 21.3%.
- Used vehicle revenue was $337.7 million for the first quarter, a decrease of $107.1 million, or 24.1%, and used vehicle unit sales were 10,694 units, a decrease of 1,738 units, or 14.0%.
- Average selling price of new vehicles declined 16.4% during the first quarter driven primarily by lower cost of 2024 model year travel trailers, discounting of pre-2024 model year new vehicles, and a mix shift towards more affordable travel trailers.
- Average selling price of used vehicles declined 11.7% during the first quarter due to discounting of used vehicles in response to declines in new vehicle prices to maintain used vehicles as a lower cost alternative to new vehicles.
- Same store new vehicle unit sales increased 15.5% for the first quarter and same store used vehicle unit sales decreased 17.3%.
- Products, services and other revenue was $177.9 million, a decline of $29.8 million, or 14.3%, driven largely by a reduction in sales activity resulting from our Active Sports Restructuring and fewer used vehicles sold led to a decline in retail product attachment to vehicle sales.
- Gross profit was $402.4 million, a decrease of $38.6 million, or 8.8%. Total gross margin was 29.5%, a decrease of 16 basis points. These decreases were driven by lower average cost and average selling price of model year 2024 new vehicles, which impacted used vehicles by (i) requiring the reduction in the used vehicle average selling price and (ii) lower used inventory levels from slowed procurement of used vehicles to allow RV owner pricing expectations to adjust as a result of model year 2024 pricing declines.
- Selling, general and administrative expenses were $371.5 million, an increase of $5.7 million, or 1.6%, primarily as a result of additional advertising expenses and professional fees and services, partially offset by reduced employee compensation costs, which was accomplished despite the 10.3% increase in store locations noted above.
- Floor plan interest expense was $27.9 million, an increase of $7.1 million, or 34.0%, and other interest expense, net was $36.1 million, an increase of $5.0 million, or 16.0%. These increases were primarily as a result of the rise in interest rates and higher principal balances.
- Net loss was $50.8 million for the first quarter of 2024, a change of $55.7 million from net income of $4.9 million for the first quarter of 2023.
- Diluted loss per share of Class A common stock was $(0.51) for the first quarter of 2024 versus diluted earnings per share of Class A common stock of $0.05 for the first quarter of 2023. Adjusted loss per share – diluted(1) of Class A common stock was $(0.40) for the first quarter of 2024 versus adjusted earnings per share – diluted(1) of Class A common stock of $0.14 for the first quarter of 2023.
- Adjusted EBITDA(1) was $8.2 million, a decrease of $52.6 million, or 86.5%, primarily due to $38.6 million decrease in gross profit, the $7.1 million increase in floor plan interest and the $5.7 million increase in selling, general and administrative expenses(2).
| (1) | Adjusted (loss) earnings per share – diluted and adjusted EBITDA are non-GAAP measures. For a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures, see the “Non-GAAP Financial Measures” section later in this press release. | |
| (2) | The $5.7 million increase in selling, general, and administrative expenses is inclusive of a $1.1 million decrease in equity-based compensation. Equity-based compensation is excluded from the calculation of Adjusted EBITDA (see the “Non-GAAP Financial Measures” section later in this press release). |
Earnings Conference Call and Webcast Information
A conference call to discuss the Company’s first quarter 2024 financial results is scheduled for May 2, 2024, at 7:30 am Central Time. Investors and analysts can participate on the conference call by dialing 1-877-407-9039 (international callers please dial 1-201-689-8470) and using conference ID# 13745507. Interested parties can also listen to a live webcast or replay of the conference call by logging on to the Investor Relations section on the Company’s website at http://investor.campingworld.com. The replay of the conference call webcast will be available on the investor relations website for approximately 90 days.
Presentation
This press release presents historical results for the periods presented for the Company and its subsidiaries, which are presented in accordance with accounting principles generally accepted in the United States (“GAAP”), unless noted as a non-GAAP financial measure. The Company’s initial public offering (“IPO”) and related reorganization transactions (“Reorganization Transactions”) that occurred on October 6, 2016 resulted in the Company as the sole managing member of CWGS Enterprises, LLC (“CWGS, LLC”), with sole voting power in and control of the management of CWGS, LLC. The Company’s position as sole managing member of CWGS, LLC includes periods where the Company has held a minority economic interest in CWGS, LLC. As of March 31, 2024, the Company owned 53.0% of CWGS, LLC. Accordingly, the Company consolidates the financial results of CWGS, LLC and reports a non-controlling interest in its consolidated financial statements. Unless otherwise indicated, all financial comparisons in this press release compare our financial results for the first quarter ended March 31, 2024 to our financial results from the first quarter ended March 31, 2023.
