LQDT - Earnings call 3 2023 | Liquidity Services, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Welcome to the Liquidity Services, Inc.

Third Quarter of Fiscal Year 2023 Financial Results Conference Call. My name is Felicia Crabtree, and I will be your operator for today's call. Please note that this conference call is being recorded. [Operator Instructions]

are and Liquidity Vice Jorge Chief Officer. today Chief Chairman President call Financial Officer; Executive Celaya, the Bill Services' Angrick, and and On its Executive for their They questions be available prepared will remarks. after

view statements. responses and XXXX, questions Services' August discussion following may as include differ to today, forward-looking The of will results reflect your Liquidity management's Actual and X, materially.

press most the that financial Form results annual in today's Additional SEC, on the is with filings the impact information release could about XX-K. in potentially recent factors report including and included

As the and you financial of includes please quarter. listen results to today's on Services' commentary press you, call, have Liquidity metrics front release in as the as well which

Services and Liquidity discuss each measures. GAAP During SEC, the believe and Management of non-GAAP measures as as they gross operating volume uses which these includes on this as of with be which will management data these is including not measures, comparable Services regarding website, reconciliations additional or call, disclosures with of management find performance operating filings certain measures operating also measure you posted data non-GAAP will supplemental of a results. useful investors. a substitute This components for merchandise and to the supplemental press certain Liquidity release considered its financial In for superior available. should its is the certain also GAAP

over the Liquidity CEO, turn this Chairman presentation Angrick. to time, will I At Bill Services and

William Angrick

on market will driven execution QX our details the from segments. GMV sales our QX by and of and performance investments in welcome gains more business achieved quarter, marketing. Good clients our for the record our Jorge the next, to earnings and our strong call. quarter. We morning, review share I'll during and And progress provide

X.X our sellers in attract registered seller participation buyers continue drive outstanding our from and growth. which turn service flexible more powers offerings Our and better million to recovery,

vertical, our XX% an guidance top range Notably, financial persistent earnings at results some in bottom continues allowed free headwinds estate Despite line. opportunity adjusted repurchase have to us we real as long-term see above our we impressive cash in and the shares year-over-year. prospects. continued our on grew this resilient deliver BidXAssets our to Together, to deliver business both share per flow, strong our and model

Let's take a our segments. individual closer look at

Our retail Direct us continue to reliability by in allowed our drive deliver our organically and driven to $XX.X retail level service convenience GMV segment XX% market our of grew our XX% profit flexible innovation we and expand as million, offerings, high customers, share. segment which to customers. year-over-year grew to has to to value

the we over selected by our to $XXX channel, expand particular, this continued bidder a to up to of that opportunity giving years. GMV exciting or can growth hard-to-find We values to to distribution consumers be channel few online million Deals picked retail AllSurplus locations. center products In auctions compelling next at unlock expand access from the plan unique winning continue

the versus our foreclosure decreased marketplace new rollout million, lower at a in which the year lower year-over-year prior low. real reflecting GMV sales, $XXX segment are multiyear GovDeals due tax BidXassets Our and delay results X% and in acquired a mortgage period to to contracts estate of

X% grew our organically. Excluding BidXAssets, GovDeals GMV

communities increase sales. to administer courthouse in-person We value in the continue to in market, to estate online government see superior growth and sales participation, long-term deliver easier real are the they secular upside of as versus

and Oklahoma, government Louisiana, will estate Pennsylvania We in Florida, of growth are real our programs vertical. number currently regions, piloting new in drive including long-term real which estate a

Maryland, range broad organically us wins accounts in Minnesota, County, California. period during strong over Baltimore in as a asset of to prior the Recent QX. Luis GovDeals and delivered our double-digit our which County, Obispo X% year and higher by GovDeals the organically of Direct our Minneapolis, notable marketplace, scale helping percentages core include sellers of drive core grow has assets profit number at in continue categories, marketplace we grew rate results fleet; listed economies for new fleet; a San

the our Near-term navigation our priorities in bidding, next-generation with our turn experience the in recovery which will GovDeals rates improve enhance business which improved release realized include of buyer search, marketplace, and will by sellers.

and value-added also improve needs. client logistics continue and the to of of to with asset expand addition the services We our listings business fleet management quality improve will of

Our grew direct numerous the remain quarter industrial million, our we to executed XX% trusted assets the pipeline organically capital high-value packaged across biopharma, market aerospace profit goods, maker and in have by successfully and transactions $XX.X for in We a consumer GMV CAG most and verticals. semiconductor energy, organically as clients for year-over-year strong the segment our grew to XX% manufacturing globe.

transacted organically heavy XX% than CAG category include opportunities Recent wins new Our net contracts, fleet the accounts strong signed progress growing with GMV equipment several during sellers, upside continued more to grew and national new and potential. revenue. make quarter

our growth Finally, traffic storefront segment with in grow financing services and product in of mid-teens lead third direct our and organically, the equipment parties. revenue more with profit to continues Machinio enhanced its categories, continued

platform expansion offers to savings other cost to convenience superior our that our solutions. continue We in Machinio invest business, customers and are the of believe and Machinio

our focused shareholders value for are time. multiple executing on conclusion, to In create we over drivers

make our We our investments growth. continue long-term share, growing expanding market and enhancing our tech to awareness in multiyear drive to brand platform

supply and benefit normalization fixed will results operational the from in the continued we've made leverage chains investments of of capacity. our Our

with provide our execute X capital-efficient with to ample with flow, operating approximately flexibility financial Our business debt, plans. in cash strong us million $XXX financial cash,

Services we In and the power buyers mission team economy, benefit the to Liquidity sellers, thank dedication to circular for planet. members across to the our closing, our

Jorge on I'll now for over quarter. turn to it the details more

Jorge Celaya

Good morning.

set with following revenue a and sustaining year-over-year, retail peak. second record new XX% the fiscal quarter seasonal For third its segment $XXX strong quarter, of fiscal grew GMV our million volume traditional

programs. to continue access through and additional to drive recurring expanded merchandise offerings of service flexible flows Our seller new

fiscal low foreclosure estate estate activity seasonal record availability addition, quarter levels included participant core government improved and traditional peak auctions GovDeals delayed our real third for In on offset of partly marketplace initiation real U.S. GovDeals.com segment's gains. sale, our GovDeals and vehicles of our while

results our of million, Our EPS EBITDA of quarter EPS $XX.X results in $X.XX, highest tying adjusted $X.XX included years. adjusted non-GAAP non-GAAP GAAP of and consolidated X

Our guidance. ratios of prior adjusted of for the revenue total direct XX% EBITDA our were in as to indicated XX%, GMV profits and respectively, our segment's and

business repurchase as Our we total the quarter our XX% with quarter, Rule adjusted $X.X We during XX of EBITDA of our direct We faster million ended from $XX generated and XXX,XXX reflective shares. flows this in than profit million and grew cash in of to operations used cash investments. of achieved the $XXX.X model. equivalents the potential for cash, quarter million third our short-term

have We capacity borrowing debt $XX credit of and under our facility. million X available

last Recapping same and from comparing to quarter segments quarter year. results the this third

up client chain a that on XX% rates year-over-year new last of recovery retail recovery excess An improved had flows reflecting segment inventory XX% Our in and segment programs transactions of in rates and broader XX% GMV, recurring segment up was due percent a year. on and model product mix the margin direct increased lower profit, accumulated challenges as direct from on sequentially. retailer profit revenue revenue RSCG drove to availability from purchase of improving market despite supply expanding up an increase reduced

up on segment XX% segment reflecting XX% profit, Our its XX% continued transactions. categories XX%, was and equipment led direct Machinio GMV, heavy also recovery industrial segment up on on XX% profit and on was CAG revenue direct was its revenue in strong subscriptions. up by increase purchase and and

auction. business GovDeals.com properties with Despite reflecting a the time GovDeals availability for property activity across prospects auction, of marketplace, down segment volumes online longer and in estate our real converting including lower available of for was improved GovDeals marketplace releasing prospects made to the auctions record new personal and vehicles, legacy volume our property X%, for

each and the direct X% segment as profit combined categories, GovDeals improvements. for Revenue were in key increased with the pricing volumes up

yet than BidXAssets a GMV similar lower and estate ratio rate to large on are the lower GovDeals revenue-to-GMV profit the direct of As resulting due transaction, effect per real have revenue. traditional a margin reminder, take transactions

net GAAP gain fair year, which adjustment the compared from $X.XX was per value share share $X.XX $X.XX year. resulting third GAAP to earnings $X.X the per earn-out quarter last income reflected the million, last diluted the BidXAssets for of in and

for third EBITDA increases share adjusted diversification quarter Non-GAAP EPS was $XX.X the to this year. marketing, same of reflecting sales, partially marketplace operations in from expenses last by quarter expansion, adjusted same market $X.XX, year-over-year was Non-GAAP offset the the up up year, enhancements. technology quarter quarter our $X.XX million initiatives; million and in support in growth and last $XX.X from

EPS last for and range is expected to year fourth adjusted above EBITDA. for quarter and guidance fiscal GMV last with consistent adjusted Our XXXX year be

quarter. for GovDeals our outlook the quarter and quarter GMV retail strong fourth Our fiscal third fiscal third seasonal-high for follows

currently We enhancements in in direct mid-XX% slightly range, our percent our mix segment's up sold, sales revenue of the as of reflecting to to over total quarter growth. our products recent revenue and our and margin in the to percent fourth last as in in long-term continuing and direct our anticipate a quarter with initiatives a of range support anticipate similar expected We business profit our and of same percent consolidated marketplace year. invest a continue technology GMV

guidance and annual quarter record on guidance, in adjusted XXXX follows. highest year current is years. fiscal Management's quarter as to EBITDA a year for fiscal the our of fourth XXXX achieve fourth X Based total our GMV expected annual the is

$XXX million to of adjusted for $X.X non-GAAP share. from per $X in $X.XX average $XX EBITDA fiscal in shares fourth non-GAAP range from $X.XX $X.XX a fully GMV $X.XX income have of guidance GAAP million and from $XXX year $XX diluted share expect assumes adjusted net diluted to with per GAAP XXXX. of ranging million, EPS that the million. the earnings We range million to GAAP million. to weighted We range outstanding share estimate corresponding is per we earnings estimated to expected is to range to diluted XX share. The quarter million the Non-GAAP per

now questions. will we your take and you, Thank

Operator

question of Prestopino the Instructions] [Operator comes first Research. line from Barrington Gary Your from

Gary Prestopino

press this I sales the did you were a the as didn't Jorge, in quarter? of -- what percentage mention consignment in but release, GMV see

Jorge Celaya

my. Oh

have will have I our deck. don't the... may think it been they XX%, I be investor but in

Gary Prestopino

that in just Okay, it that in put you out. Usually, but this I time. I'll was wasn't curious. there, check

Jorge Celaya

apologies. Yes,

Gary Prestopino

No, okay. no. That's

what you with can you and you're here. Phoenix of Pittsburgh, have, couple on it pick doing a is -- With X what these one Bill, Or go I bid think where centers something one up, right? in things and in nationwide? that So do

William Angrick

have be, quarters, in Cincinnati. be capability our And rolling past over Phoenix, other centers as U.S. discussed out at we've time. distribution the we We will

Gary Prestopino

end us to the that, of fiscal give some may 'XX, you have by idea of want how you in place? Can wish many of list your these

William Angrick

really maps a higher buy consumer Things items continuing this more high-value And I to smart And such electronics. the to home, and X. as say to behavior of for would theater bulkier, consumers transport necessary. and are tools, appliances, we lawn the are equipment, and X garden the to items backyard. many them don't home percentage of where for these want building than kitchen,

with direct to trans consumer, bring So our fulfillment consumers then we've centers, and back these to cost, them leveraged and locations which clients, reduces them can handling such resale we prepare costs, regionally increases that recovery. center for

for items. and the chain. carbon for still win-win: we the We methodology. purchasing reduce And footprint buyers. competitive these win a supply win platform using cost it's retail same and really And for landscape create online We're auction certainly for a sellers,

Gary Prestopino

the of that Okay. revenues these Is And a with strong jumped sites? spending looks doing can of mean, -- attributable it sequentially, some you you're up what your new of like and are of year-over-year. some marketing I up is Or kind percentage as exactly to and what the... -- sales was it

William Angrick

really less I we're about Gary. push to would And expand businesses, continue and say about some sites market more interesting No, that's to share. our the feeding

heavy investment. growing business, which organically, fleet calls offering, our expanding equipment service XX% People larger Our accounts. we're for like over is just into

much. So we that like very

you ability managed which is know, a self-directed ] like AllSurplus include and to offerings, identify, our large listings our consequence Deals. in our enterprise on of XX% [ through fully a acquire ways, accounts marketplaces, variety things direct multichannel manage sales organically of growing Retail

each industry other as you like get we're these be is of pieces. so a but just conferences. fireside thought out And People presence to we channels interest, leadership in we thought see out do that at know. back, see generation story. programs, telling includes The marketing very leadership see panels, investment and our we Conferences have come digital, and present and Most want still demand industry as so and have to well. and those chats

have for we the you derived be and investment, we the can will is P&L. growth that longer-term from that investment. made it's us, So off see there that like in But an paying increase

Gary Prestopino

then up, just government asset And new real there that estate that these lastly, business piloting or government of Are about Okay. new for sell are new to estate you're you starting real talked programs. categories in you've signed agencies? terms

William Angrick

Yes, our these working to in estate these sales to patiently with, are new pilot relate online and instance, this real policymakers sheriff to programs. passed associations laws and efforts that persistently government get

I just that early outward. radiate it jurisdictions like Louisiana, and sales GovDeals adopter. be And So one we're laws, begins an -- mentioned, and off programs that could evidence, new have That changed then Oklahoma to kicking county. we places -- with initially virtual like with

years, model, we've the XX at influencing decisions. a businesses that is And this ignite for like transformation we long-term XX, and on if digital can policy business And you And GovDeals adoption. over been this reflect our effort.

of good a the it. compounding grown hold. then factor can of XXx. local One has municipalities a in adjacent just XX to as over base. marketplace that, GMV results, GovDeals years, begins we've it, our law continue of the you by sponsor reflection the buyer And And about XXx. buy then to tries And into grow

lot moving does estate those it we and by of that from So the category online, same attributes lend to we believe know itself a real that there and is efficiency moving transparency things online. comes

Operator

next The from Craig-Hallum. of from Instructions] George comes [Operator Sutton line the question

George Sutton

for with results, take First, Cincinnati. congratulations. or They guys, not compared in being was Nice weekend. to confused Pittsburgh Cincinnati I last would kindly

wondered if marketplace. the of will a it in impact and do bit next-gen you on us of give And I kind you more What the have? notice what buyers sort little of Bill, think could things detail sellers can terms difference?

William Angrick

Sure.

over both marketplace many the So extend that user stack are aggregated has machine-driven features interface this loyal engines. years, we've and and perspective time to GovDeals, for automation we AllSurplus which was is in the the marketplace, A George, great so but GovDeals made to lot an from tech in have recommendation upgrade, many as it the tools from extension. our investment perspective. AllSurplus such of that many anticipation There to customers, an

a comes when in will or So bidder buyer to comes we prospective in, stream. click a track begin

will you've you're viewed We past. you've seeing on make data the bought the into user. in will on have your everything past, you've we tap that more the past, from everything and everything the one certainly And any registration what it to bid feature. profile, effortless certainly as prioritize in much for you That's

more improved is participation, these just GMV And is through type-ahead which search, other Really, operate. lends bidder feature to path reduces features. Another think will to that, In again, that higher changes the marketplaces improve just we GovDeals user-friendly total, purchase. engagement. to bringing this we with parity

just There easier design, to information see. more that's features: can landing are responsive description to to easier other lots do clean, be multimedia a pages that of very customized. more open up opportunities the We item category manage,

and ultimately, for most spend and we on assets, can more our recovery unlock relevant ultimately higher GMV sellers. buyers rate higher So the time

George Sutton

Perfect.

make understood on sure to wanted I Just CAG. fully

and mentioned have pipeline you wondered You could number to if strength. be where projects a you more you're a specific seeing verticals. of new that as strong across I

William Angrick

factories opening Sure. factories Lots on know is industry. sunsetting sort certain in of markets manufacturers markets. the in that semicon there of and Well, focus generational we other

driving good some have growth. relationships legacy We of there. a client That's

portfolios And energy has about to supporting EV of from Energy multiyear and a decision-making us. focus been other A lot chain alternative on of happening, types. supply innovation a carbon-heavy energy good to there's lot clients. rotating

liquidity requires over time. them a to that access help affect that's that transition So to market

on focus around of per products Lots packaged goods, global activity cost assets, right the best unit. the at assets. constant fleet plant vehicle Consumer business,

the drive as over clients devices. assets we tied technology find had I investments And then, to in a gas think they equipment future fleets cleaner-burning to actually the legacy and CAG to is we to GMV. upgrading business, sold that time, record assets fleets, CAG of out trying make continue fleets, and introduce number of many mobility, clients, tracking vehicle help those cases, fleet which natural exit waterfall

So assets the always the transformation really catching is, industry constant driving it's cyclical and thing interesting of vertical, those these change. just are in industry any CAG And sort highlights CAG we We're touch the some undergoing that's every a about marketplace. pipeline. of

George Sutton

Perfect.

Just this one other question and about thinking marketplace in modality. a

buyers registered and participants up Your your both were auction year-over-year. X%

transactions of number Your flat. were

on to does try the move focus side? the As that you're investing business, marketplace? in that supply really Is building of think to how thinking the of you out you

William Angrick

need on head. you X-sided You and hit the It is both. nail a marketplace, the

certainly be to impact increasing environmental off for lot relates marketing our an in services, the assets to financial the have, where throughout manageable our only when upper funnel to it Taking it hits orderly those then hands fashion in terms the them as proposition. assets it the and We allowing complexity needed, investment, but awareness selling our clients letting before bundling more of a surplus to brand redeploy proposition, not they're customers, marketplace, sales measurable needs. our of and of and leaned their value value tracking

well shareholders world scrapping to to companies Board steward their report AssetZone So and been like disposal, of giving they received, our material. of very asset a better things manufacturing in waste, metrics providing and them they're equipment around how up software the reducing that can industrial has reducing being

smaller higher-volume, higher-value to helping which events. in-person like much. asset that events, leader government to helps footprint require using management and with sales asset in physical require and channel. of We lot raise a disposition they manage awareness and It remove stores, been We've drive also a with a these partner smart their reducing footprint, very in in-person to being clients them our leader people about digital a a

us attract thought and are help drive So things that which leadership supply. yes, those ultimately

Of on marketplace with course, more, think, continue innovation to and I our in we engage asset with about we're GovDeals; always enhancements, promotion which with buyers. focus doing with to talked I channels buyers social

AllSurplus digital Our sort from channel deals interesting to is in-person. channel crosses of that an

customers, word of have at great physical physical We that's the price. do a environment, the in out their tremendous inflationary we pickup. finding proof social satisfaction of And express of deals our point items digitally. interview great find We at and And share of the marketplace. of when an can -- people in received. mouth valuable well local that then they lot We a

a people and you get viral you when that talk you share can bump to so out. And

working we're but you, in I tell enterprise the efforts. sales and in of from probably GovDeals sales, sides, capacity So on increase in majority would retail segments: all both the sales using and benefiting we're are all is CAG, our expanded that

Operator

in Thank does your program. conclude you today's participation the for conference. This

You may now disconnect.

Liquidity Services (LQDT) 3 Aug 232023 Q3 Earnings call transcript