CEO Fleming: Lazydays is ‘Laser-Focused’ on Right Footprint – RVBusiness – Breaking RV Industry News
EDITOR’S NOTE: The following is an excerpt of the prepared remarks by Lazydays executives – including Interim CEO Ron Fleming, COO Amber Dillard and CFO Jeff Needles – during the Tampa-based dealership’s conference call on March 31 with investment analysts. The call followed Lazydays’ Q4 and fiscal 2024 financial performance report issued earlier that same day.
Ron Fleming
2024 was a year of significant transformation for Lazydays. This began in the third quarter with our leadership transition, accelerated in the fourth quarter with a series of transactions designed to strengthen our balance sheet and streamline our operational footprint, and has continued into 2025 as we execute our turnaround plan to reshape Lazydays for the future. While the fourth quarter and full year 2024 were undoubtedly challenging, we believe the steps we have taken and continue to take will create a more durable, agile and higher-performing company and ultimately drive long-term shareholder value.
Reflecting on our progress to date, in the fourth quarter, we completed a comprehensive recapitalization inclusive of a $30 million common equity pipe from two of our investors, an exchange of all our outstanding convertible preferred stock for common stock, and an amendment of our credit facility led by M&T Bank. These transactions added immediate cash to our balance sheet, enhanced our capital structure through the elimination of our preferred stock liquidation preference and annual preferred dividend requirements and reduced our debt while providing financial covenant flexibility.
During the quarter, we also began the process of rightsizing our dealership portfolio to further de-lever our balance sheet, simplify our operational footprint and improve the underlying earnings power of the business. We completed the sale of one dealership asset for $8 million and agreed to sell seven additional dealerships to certain subsidiaries of Camping World for $65.5 million, $10 million of which was comprised of a non-refundable deposit. We completed the sale of five dealerships to Camping World in February and March 2025, with the buyer electing not to close on the remaining two, our locations in Portland, Oregon and Council Bluffs, Iowa. We remain well equipped to continue operating both stores. Importantly, due to the way in which our transaction with Camping World was structured, we retained the $10 million deposit and have exercised our remedy for their refusal to close on these two stores, which relieves us of any obligation to issue any common stock to the buyer and avoids diluting our stockholders. Taken together, these actions fortified our financial foundation and provided us with a more focused dealership footprint, allowing us to better navigate the evolving RV landscape to the benefit of our shareholders and other stakeholders.
As we look ahead, we remain laser-focused on ensuring we have the right dealership footprint and maximizing the operational performance of the stores within that footprint. To that end, this morning, we announced that we have signed a letter of intent with general RV center to divest three of our locations, our Fort Pierce, Florida; Longmont, Colorado; and Mesa, Arizona stores. If completed, this transaction will add meaningful cash to our balance sheet reduce our indebtedness and decrease geographical redundancy in our footprint. The letter of intent is generally nonbinding with the exception of a 75-day exclusivity provision for these three stores. With respect to maximizing the operational performance of the stores within our footprint, as Amber will discuss, we have made encouraging initial progress in this respect and we believe that continuing to improve our operations will unlock significant shareholder value in the quarters to come.
In closing, I want to thank our employees as well as our shareholders, lenders, customers and OEM partners for their support of Lazydays. As we continue to execute our turnaround plan, we are committed to acting in the best interest of all of our stakeholders and upholding Lazydays’ hard-earned reputation for delivering the best RV sales and service experience in the industry. While there remains much work to be done, we are confident Lazydays’ best days are ahead and we look forward to continuing to forge this new promising future for the business together.
Amber Dillard
Thanks, Ron, and good morning, everyone. On a same-store basis, we saw a decline in both new and used unit volume relative to the third quarter of 2024, partially offset by significantly improved gross profit per unit sold, reflecting the benefits of the inventory actions we took throughout 2024. Offsetting these improvements in the fourth quarter were inventory adjustments of preowned vehicles of $3 million and LIFO adjustments of $3.8 million. Our total gross margin was 19% in the fourth quarter compared to 21% in the third quarter of 2024. Excluding the impacts of the inventory adjustments and LIFO adjustments, our total gross margin was 23% in the fourth quarter compared to 21% in the third quarter.
We continue to see improvement in F&I, where our F&I revenue was over $6,000 per unit, up 3% relative to the third quarter of 2024. Notably, our finance penetration in the fourth quarter remained strong at approximately 73%. Our focus on maintaining a healthy inventory position while increasing our ability to procure more used units directly from consumers continued during the quarter with trade-ins on vehicle sales in 2024 and thus far in 2025, coming in significantly lower than our historical averages as consumer confidence and macroeconomic trends remain uncertain.
As of today, our new inventory is comprised of 75% model year 2025 units and 25% prior model year units. Over 77% of our new inventory is towable products, up from 73% at the same time last year. demonstrating current consumer demand towards more affordable inventory options, targeting first-time buyers and payment conscious customers. Our motorized inventory decreased 44% from the prior year’s period given aggressive inventory management and store divestitures, leaving the company poised to capitalize on a healthier inventory position as we head into model year change and spring selling season. We continue to evaluate our product mix on a store-by-store basis, refining product classes, brands and stocking levels based on market demand and competitive landscape at the local level.
In 2024, we launched our consignment program, which continues to generate healthy gross profit while giving consumers an option to recover some negative equity. Indeed, 76% of the units acquired from customers during the fourth quarter were consignment versus an outright purchase. From a macro perspective, our fourth quarter and full year 2024 results were certainly negatively impacted by economic and other demand headwinds as well as hurricane season in our Southeast locations. That said, we are optimistic that we are near the bottom of this prolonged market down cycle and we firmly believe future retail demand for RVs over the longer term will return to, at or near historical levels as consumers continue to value the benefits offered by the RV lifestyle.
Moreover, as Ron mentioned, we see a tremendous opportunity to continue to improve the operational performance of stores within our footprint without relying solely on market stabilization. We see substantial opportunities for improvement across all functional areas of our dealerships, including inventory, sales, service, F&I and marketing so that we are operating as efficiently and effectively as possible and serving as a true partner to our customers and OEMs across the full RV ownership value chain. We are working closely with our general managers to identify additional ways to increase volume, improve F&I and drive incremental service revenue, and we look forward to providing additional updates on these initiatives in future quarters.
Jeff Needles
Turning to the fourth quarter results. Unless otherwise stated, please note that all my comparisons are versus same period in 2023 and that our overall financial results reflect expenses incurred during — or due to previously discussed transactions and planned divestitures.
Starting with volumes. New unit sales declined 7% or approximately 92 units in the quarter. Despite this, average selling price for the new units grew 3% due to improved channel health and less competitive used inventory overhang. Pre-owned retail unit sales, including consigned vehicles were down 23% or 268 units during the quarter. To the positive, as Amber mentioned, we saw strength in towables, which on a year-over-year basis are 3% and 5% higher for new and pre-owned units, respectively. Focusing on the top line, net sales for the quarter were $160 million, a decrease of $38 million or 19%, which is in line with planned lower volumes for the company. Gross margins for the quarter, excluding LIFO adjustments, remained unchanged at 21%.
SG&A expenses were $53 million for the quarter compared to $46 million in the prior year period, primarily as a result of higher transaction and legal and professional expenses related to the restructuring. We anticipate overhead and SG&A expenses to decline as we continue to make adjustments to our cost structure and with the completion of our previously announced divestitures to Camping World. Excluding the previously mentioned costs related to transactions as well as restructuring and other non-operating expenses, we had an adjusted EBITDA loss of $24 million compared to a loss of $11 million in the prior year period.
During the quarter, we reduced floor plan debt by $11 million and reduced $6 million in term loan debt and exchange preferred stock with common stock. In sum and to echo Ron’s earlier comments, while there remains significant work to be done, we remain energized by the prospects of the business and our ability to drive improved results for the benefit of all stakeholders.
