PRTS - Earnings call transcript Q4 2021

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Operator

Good afternoon, and welcome to CarParts.com Fourth Quarter 2021 Conference Call. [Operator Instructions] On the call from the company are Lev Peker, Chief Executive Officer; David Meniane, Chief Operating Officer and Chief Financial Officer; and Ryan Lockwood, Senior Vice President of Finance. [Operator Instructions] Please note, this call is being recorded. The prepared remarks and responses to your questions could contain certain forward-looking statements related to business under the federal securities laws. Actual results may differ materially from the contained in or implied by these forward-looking statements due to risks and uncertainties associated with the business.

as the results, and annual be please Form and of that important report found discussion SEC, XX-K affect the Relations could refer XX-Q on a our material which website. other risks factors on both Investor For of with can filed to CarParts.com discussed. a unless non-GAAP XXXX, in Also GAAP and On figures, compare XX-week period otherwise today's call, period XX-week a measures will be financial stated, certain in XXXX to both measures is A in GAAP reconciliation non-GAAP financial today. of press CarParts.com issued provided release to the With the that, Lev to I would now call Peker. like turn CEO, over to Sir, you may begin.

Lev Peker

Thank the quarter Today, excluding CarParts.com and third significant double-digit consecutive operator, growth. net quarter is solid our good achieving year-over-year another consecutive year up XXXX, eighth of report you, to afternoon, with XX% compared year, of the growth, and also pleased sales week. is everyone. extra double-digit to This

million adjusted seeing and of the all generated revenues we have the $XX.X of size years, X in just doubled of in $XXX business. million hard entire In team, we XXXX, our For work EBITDA.

capacity 'XX In come growing our fully Jacksonville, distribution Grand center and in addition, in Florida in as our online. Prairie, we're Texas expansion new

over profit past supply and despite now we expanded the slow margin million websites disjointed years X a XX almost XXX and environment. have visits Over ago, to have from website Three the our years, up chain gross XX% year. global receives that X XX% challenging we flagship had

Our click-to-ship times to days. used be several

X we had about feet reducing XX with orders of majority totaling, our of than ago, XXX,XXX goal the to only hours. time XX space. ship the hours DCs square out less in X to Now years

years. the the like of remains not environment. which and a few automotive reiterate centers years, top rapidly part a external have have would over EBITDA And square strengthened to changing laying to of million over team long-term our We warehouse significantly to we X% importantly, adjusted adapt allows disrupt globe. strategy X time groundwork X,XXX we our X.XX fragmented and across the $XXX the to XX% CAGR nearly members and that are us our to XX% aftermarket Now past right foundation, has as space industry execute Most to have distribution operating through we XX% billion with line of highly right XXX changed place. in margins target feet

committed Now briefly let you solution to our me right on can a progress. that customers are parts, our vehicle. update their With find complete we ensuring fits

million applications catalog, X [fitment], in which house branded pictures proprietary products. well brands as parts, staff invested We hours our premium have includes and over for both as

and competitive competitors. represents catalog advantage for to entry is a Our all major barrier powerful the a

we allowing grow year, management assortment applications. strategic product into execution prioritize to disciplined through pricing, offering, owned have financially new approach This our our and reorganized that us last expansion the category merchandising sourcing, all plan. Over is a and a optimized structure implemented team incorporates our curated brand highly

to have our years, over our and closer customers. on expanding footprint last time, right For distribution of we getting the couple focused

When at within to as customers X remains our been both customers our to happy network day Prairie, time. service XX% goal of be XX% we able time. Jacksonville expansion Our days Grand transit are to be Texas and most our have additions our in And in to to is facilities as to on to day XX% Florida. brand-new and able report recent deliver The well facility Jacksonville, time expect fully that stands to budget. XX% I'm one functional, X on within of a

Place. Right to Turning

the end being as appointments. it pay to Finance, and right the process assist have customers automation over review I then to as months, repairs. will been the encouraging meet to help to interest financials, the booked finding The well early have into the supply provide approaches operational plan SVP XX installation now with goal our able various Over the the demand next our part continues XX testing build in to results over the the to been of chain with of on to website anticipated To past customers and and and for the David we grow. pace will turn we update. several of our quarters, the Ryan, to mechanics

Ryan Lockwood

Thanks, Lev.

up generated year-over-year XXXX. revenue in excluding we after previously extra mentioned, As of million, week the XX% in QX, $XXX

excluding stack. year, XX% up For we million, week up profit the to of a the XX% full the revenue and generated XXXX, for was $XX X-year and XX% Gross on extra from up full gross XX% XX.X% million, $XXX in QX profit XXXX. for the were million quarter the quarter up year. profit loss $X for year. for million and versus to $XXX quarter XX.X% the margins million Net Gross $X.X was for the was

items. reflects noncash investments impact the QX EBITDA in For million $X.X the supply million approximately the year additional prior compared net $X which despite loss of period million, was chain. $XX of was year, to Adjusted the million into in the $XX.X

million, DC for For a into as year, additional was business our strengthen network. heavy where this expanding as company despite the to related years X adjusted improvement growth the from the our investments expenses foundation to EBITDA represents XX% ago reached $XX.X well

onetime back a do EBITDA. start-up As out these reminder, adjusted from costs not we

$XX sheet. plan $XXX which supporting includes record At Turning stock. balance of and goal the a to $XX quarter pursuant to stood approximately end, our double-digit our safety million our million, cash our million inventory at growth of position was

accordion we summarize and liquidity to carry Our strategically the chose carrying. we would normal supply should to chain ABL position, our $XX in additional need a inventory, which the to environment, to million need To arise. remains be $XX undrawn with available not million option

one, As with our we cash currently we credit; think flow, three, and number inventory and our our about, two, line feel safety number number undrawn stock; liquidity. of our free current comfortable

plans. to very which capital with help DC drive existing efficiency investment, growth Additionally, also minimal will can we revenue our continue to achieve

repurchased even short very valuation approximately believe to for fourth trading We our prudent window. shares $XXX,XXX. the attractive a quarter, to XX,XXX is thought in and During our it capital return we shareholders

X inventory position first against year, double-digit For revenue helping is weeks the stimulus. us post prior of our year growth the robust

are we solid margin and both seeing sequentially year-over-year. improvement, Additionally,

fiscal For correlation growth David. warehouse of with net a year-over-year revenues, cadence end double-digit of expect the Florida the year And that, centers end with our Texas to our strong we I'd our distribution over turn with opening to at at it XXXX new the like of QX to QX. and X expansion

David Meniane

Thanks, Ryan.

on by integrated are to we to We As X-day expect significantly mentioned shareholders excited is previous core our time the chain inventory outbound this we're Texas and time. to supply optimizing our progress, coming ordered parts availability on and investment and To philosophy. last committed that the on budget. facility goal capacity We're leverage on XX% year of of we our expansion of inventory speed, covering transit vertically update our which increase the our remain and for weeks. currently our we in at shipping receiving calls, the our delivery country over XX%

new inventory. budget, slowly and As Jacksonville, on facility, up schedule also it's on Florida and building we're for our brand

in want provide in budgets expect be and meeting part extraordinary We an relentless in I supply to capacity QX, operations us later next thank more facility our driving call. which aggressive the to deadlines update and our has competitive. chain we'll type team, to this on our increase been of

environment. we inflationary the world-class even time, invest to profitability On and we meaningful further in and side, technology science expect data revenue improvements continue an same-store in tools. chain to our efficiencies supply these Over drive increasing

long-term for Finally, we committed our of shareholders remain philosophy to discipline. listening our today, financial

we see with individuals where return such to to while CarParts.com to only an earning group We We opportunities and our We're our incredibly team. growth also like exceptional capital collaborate will on a investment. deploy every significant lucky day. of each accelerate would thank

on is the helping Your drivers back road get dedication to of the mission inspirational.

it back to turn Let Lev. me

Lev Peker

David. Thanks,

significant While underlying business the our has profitable maintaining market, market auto shown year-over-year, favorably. which an trend to has improved growth overall within continues overall stock volatility,

years vehicles For These expect X/X too in to number grown a shows replacement their the for parts, more strong are to operation. require experience aged to account which driving inventory be the vehicles of that warranties over XXX,XXX online, amazing example, X vehicles more future. almost and from square in all confident of a original data for our an of XX ability old has With and never our for road. feet space our warehouse and coming record foreseeable serve amount back to tailwind of in on customers the been them team, success I have we get

on their $XXX are supply, to the XXX is be firm the aftermarket prices demand the addressable average that and vehicle over our billion, can short we a used for cars vehicle for vehicles used will enduring total bodes a in well more longer. which it driving automotive the likely are are repairs vehicles With on the and our push as with car companies into repair in maintenance and million additional sorting robust and consumers holding strong remain maintenance. And being driver markets resell. help belief that road and conditioned in for to market new vehicles the New that

to stock Lastly, given we like in near we credit Right our mission the of now I the Right the for on delivering Without believe on of tapping have would liquidity Parts. line that capital Time. turn current capital and operator Place. enough over our it Right inventory, continue position, the of to amount to our safety undrawn markets questions. future.

Operator

first Instructions] [Operator Capital Darren Aftahi ROTH from comes question Our of Partners.

Darren Aftahi

'XX on kind could you of expand I commentary the of If kind just gave.

of of about there little in just and Texas So in than some and Jacksonville cadence quarter around kind QX your a us normal. the the and help coming of given of with the last you year, Can quarter, XQ. the second year stimulus that online maybe look how comments different understand kind money was might the first beginning

kind then of dynamic that's about shipping question have to of gross incremental think pricing guys And one been into any you do power the margins? tapping upgrade. Will kind costs? we I that So do more you going offset see have one. of know we pricing. second How And on forward? And

David Meniane

Darren, it's David.

cadence in new DCs let the on then margin first and So I'll question on Ryan I'll take chime piece. the the the of

So our We're process of in footprint. yes, you're absolutely expanding the right.

coming we Texas expansion So online. over the launching next basically few weeks, are that's the

we going holidays, pretty additional QX, about Florida the going our overall, of feel inventory there. we couple good to QX, the a have in capacity of and but And have Towards then end warehouse we're the online.

goal same. the It's of that cover our your I within second XX% same And that the capacity. to to I of And transit leads long the the think takeaway freight. So XX% part be able to It's time. still country increase closer think, customers. time, get X-day term, is question key the the around to is at the to into

Ryan Lockwood

Sure.

So we get the customers, Darren, to close are post obviously, freight. margins as

think we full long-term margin, it when So is year that's towards the about and And going to several over term, the over quarters, be helpful. long our targets.

So if we -- price. can to and mentioned, continue you you push

at I to we only think basis a margin excluding favorable if science, great onetime on teams where supply data really QX planning. had uplift, look points. chain, XXXX you testament It's compressed margins, inventory XX our

to very have already, turning that we out year. where proven with and we've the So they're happy ability maintain we're margins this

Operator

Our from of Victoria Davidson. next D.A. James question comes

Victoria James

[Indiscernible] X the that's on just Can me. your So P&L? impact to for going you meaningfully an update provide when

Lev Peker

Lev, Victoria. is This

effort. automated meaningfully of think it's well I drag part little I a not out it's on to team And EBITDA. dedicated the to that's the going a our building it's our adding bit budget. one, we of revenue going in There spend into but of as now, technology our small is as our think right overall a have and be solution, terms to EBITDA to

of we year. going as that's kind us into at drive next I for customers think not we're and conversation want this We're the looking a that's what's yet, choice a shop. there to probably then offer to and

kind that's we're it. how looking So of at

for drag then a and year next definitely and So ad see we'll not year. this not an

Operator

[Operator today's does Instructions] and questions further I'm participating. this no this showing conference. for gentlemen, time. Ladies Thank conclude at all you

a great day. You may disconnect. all Have

CarParts.com (PRTS) 2 Mar 222021 Q4 Earnings call transcript