Camping World (CWH) 9 May 202020 Q1 Earnings call transcript

Company Profile

Participants

Brent Moody	President
Marcus Lemonis	Chairman and Chief Executive Officer
Mel Flanigan	Chief Financial Officer
Rick Nelson	Stephens
Brett Andress	KeyBanc Capital Markets
Craig Kennison	Baird
Tim Conder	Wells Fargo Securities
Ryan Brinkman	JPMorgan
Mark Jordan	Jefferies
Tristan Thomas	BMO Capital Markets
Jim Chartier	Monness, Crespi and Hardt
John Lovallo	Bank of America

Call transcript

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Operator

Good afternoon, and welcome to Camping World Holdings Conference Call to discuss Financial Results for the First Quarter of Fiscal 2020. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. Please be advised that this call is being recorded. And the reproduction of the call in whole or in part is not permitted without authorization from the company.

and today Moody, Lemonis, Financial President; Ward, Operating call Executive and Officer; the Accounting Chief Brent Chief Officer; Mel Officer; in are Chairman Marcus Chief Tamara Officer. Participating Bell, Karen Flanigan, Chief

I Moody get will us Mr. to now call to the turn over started.

Brent Moody

Relations the press in issued Thank of and this meaning XXXX. good covering a A on Litigation release Securities XXXX found quarter section copy press everyone. and Reform first website. the Investor of contained financial on that can company’s afternoon, the be call you, this Act Private release the forward-looking of Management’s afternoon, company’s the results was within statements remarks may

financial and future results plans, our in financial business and may goals, industry shift, XXXX future our opportunities, liquidity and remarks and compliance statements impact include of business, These condition; abilities customer the borrowings, our increases strategic anticipated with regarding trends, and our financial our performance. covenants COVID-XX our financial on

Actual in on results various Any those and our reports materially including XX-Qs these the by with to our section factors, important result today, indicated them. discussed as update Form those a we forward-looking of undertake Risk our statements statements and Form of Factors other in only XX-K, may SEC. represent views file the from differ as no obligation

earnings comparisons results XXXX made our measures the GAAP to XXXX first will which our our noted. results website. important the to EBITDA, to non-GAAP certain measures All performance. to referring financial we comparable operating financial of we investors be financial non-GAAP on today’s share are be against and quarter otherwise adjusted EBITDA our included as assess in Reconciliations and directly that unless call release adjusted on first quarter believe of note are such also these most earnings Please measures per may diluted,

I’ll Marcus. now to turn over the call

Marcus Lemonis

Brent. Thanks,

you our and to made sending keep start and hope the families those you’ll that who’ve right so brief, we time has sentiments been have going we’re we that people into want questions, safe. what We’re to affected also know world, by in and different our are a the Q&A. living your a by out obviously prepared to and to in so go of lot remarks we’ve decision We happened

I customers delivery, have First work off, a a call such say performed team open pickup, shopping, well responded serve initiatives from flexible and curbside I in and majority team free program. more be using conditions. of clearly and is home We’ve our no-touch this The our as members. as and have staffing business our implemented remained center crisis to support enhanced the not that technology, way our proud protect could to our DNA. our stores during changing Resiliency of importantly, number home of as advanced and has

are in our with what’s we directional first and especially in quarter pleased results recent very of light our Overall, business, happening world. in the the trends

accelerated we has not saw effects to trend that continued, that fact margin positively see and and into the did our even trends saw mid-May. and and very And the began we in in reverse, a In mid-April. pandemic in into January were on I trend As in call, first slowdown feel mentioned lasted February we March. start that revenue mid-April, strong, But only our last of mid-March, the half of our but continue. trends to those

March, was the over XX% positive billion. encouraged the not And slightly with EBITDA in XX.X%, the we I April, to we increase as the we pandemic and a the XXX over despite $X the am fact up closed adjusted experienced we of $XX a last final was results the the While and weeks for be number stores, very revenue margin it slowdown we have significant prior for do points of positive declined basis expect two quarter saw, Notwithstanding that Gross was the trends year. and the to in results million, well. that total quarter.

quarter $XXX the accounts million ended with We strong $XXX a offset primary interest in plan million cash, of floor and sheet, our in balance $XXX including million our accounts.

unencumbered $XXX of net RV $XXX unencumbered We used have and also of inventory million inventory payables. million of

Importantly, and liquidity business currently any the least covenants sufficient financial do to not the for that operate months the next we anticipate issues beyond facility. our we have with at believe and under credit XX

dividend. to the quarterly maintain In regular plan addition, we cash currently

touch me on Lastly, guidance. let

quarter, trends managing are latter call, the we’re our earnings and understand While are trends and we it’s believe first our of about to our good we not as because the in of, we and confidence control of guidance May note, Please guidance have provided withdrawing April continuing because have we last macro way trends. business, the part until more prudent we as the macroeconomic information, well we the in we we withdraw in our business. on feel don’t the we’re seeing not simply into that our

Now Mel let to more me turn the a few highlights. touch call on over to

Mel Flanigan

on are typically good few Marcus, things I is available press website. do all provide. want the though. release All that we details to the everyone. point of the X-K numeric and important go and feel that today Thanks, I out afternoon, time, our In in that issued that we won’t interest through and we information a

this is position our liquidity First storm. perhaps and weather and to capacity foremost

we’ve In is began going We running and look to do reduce the of multitude know not cash action expenses. to aggressive Over environment macroeconomic a the past like. preserve to and those obviously we the what of month, scenarios, taking evolve. tenor continues been March, scenarios

steps than our a business the summer. saw took slowly and half of country latter move through open, starts number In that we the as April, So fare better retail position we to encouraging businesses better most we might the to signs ourselves. of

modest which is directional off builds first the business improve by strong quarter a slope and at our here, scenario that trends several over current our weeks. from assumes supported the past So a will

take As recovery able are of that line months. importantly, flooring meet of believe position level covenants next a the to our be strong advantage and whatever to for market a we’ll that financial affords, the at XX result, of we we least in

over turn to operator I’ll ahead. the Operator, that, With Q&A. for call the please go

Operator

Yes, sir. [Operator pass from the first Instructions] question of go to Rick Please We can Stephens. now Nelson ahead.

Rick Nelson

Hi, environment. in thanks. Good tough Nice a afternoon. quarter

saw quantify trends in Okay. May. and you late the Marcus, sales can particularly back and spoke March, end, what the about, you you April early that

Marcus Lemonis

the take So Rick, I’ll break into you second down and I’ll even quarter. quarter, the

a we most million we on the our unit we basis a the that everything first, feeling sales of to pay And with were revenue it, only missed the about did During of on trends our have continued days March, like importantly, positive XX we call same-store seen in with two the last the of to that momentum had $XXX customers Unfortunately, is protect back. just associates, and trying that protect and us quarter, we out sitting have would weeks believe period. through accelerating.

that last our results past. were quarter structure. and January, the to cost in quarter, We variable see February financial largely more we part us to improvement the about years EBITDA they we thesis that the improvement XX SG&A supported and March, to worked really we months. first got And believe are our combination supported that fourth from maybe margin got in by it ourselves return the We hard in they while and away The first proving the by talked the the about believe of of it out you our in performance.

but in experienced a those month. the As to for through started of that we entered the March year-over-year to back of little the we the maybe of weren’t on a modest that same quarter, second April, we of and the a went positive of slowdown gap days of trend as closing. happened XX on, sort half started And deeper see to start first half XX obviously back gap days slowdown see close. the We to even we basis,

May our in part the we period, company’s and I’m story, that tell was As here weekend weekend, biggest our to today, end last Saturday every our aspects, all sit Sunday business. proud Friday, in in of you of history,

feel those going. good so about where And trends are we

about levels thoughtful very and the we the what our in very our part sit and is of our positive levels all half goal as front lost of we’re trends during and because XX-day March period. up SG&A April, in of to expenditures to missed staffing, out we of EBITDA being areas are back our what today. are here we to very However, we feeling make expenditures, careful XX about about But the we that try

Rick Nelson

or, EBITDA you. are got sales you trends? And trends, when Okay, speak about to you say, same-store these referring

Marcus Lemonis

we many, Keep mind, sales trends the it’s hand-in-hand. I SG&A believe kind will of of tighter in to and very days see XX in translate digging Well, years, stays a that, been results. positive than April. Obviously, as rough of that first out them accelerate our we’re many

a have probably lot on what is $XXX days to to believe of not out up. the That make part in that XX out missed of April. dissimilar of first the on in ground we million we same I we March So latter too missed

Rick Nelson

it happening what’s is sales? same-store Got to to on you. possible that basis, unit put And a

Marcus Lemonis

that is hour. existed much Look, that is tell we’re and up. the I What and able in that know that hour, leads outside guys were were trends have up that the range, We our the know traffic and conversions understand we’re of we like day-by-day-by-day. to we are pretty know down, our of unfortunately, doing by think in that we out the negative macroeconomic by can first moment foot – up, sales But web days have our dramatic. we XX% that decisions the we the making challenge our control. is are in you that you our are are trends climb They are, don’t it’s appointments analysis the this been happening XX I

of showrooms cases, have. technology we’ll more the salespeople think And don’t making who provide sell around of the through we’re clarity I through job second remotely the the because end a sales, moving fast. particularly some most be our to our same-store working are more in of any too till because able so coming it’s door closed, better that with less front unfortunately, doing quarter opportunities, are we and

Rick Nelson

performed that Good it’s how holding I’m in enough. memberships up profits, the the Fair okay. you, curious outbreak? since how Got and quarter and Sam

Marcus Lemonis

business to always a Sam cash specifically important deals to to Good base Good business our Sam analysis with it been installed as It’s community. customer the very relates that with the has stable annuity needs apples-to-apples. our be predictable memberships flow, that go-to The note

basis, apples-to-apples global it we good And are Sam basis, closed memberships a because in decline look Club we a our the the closed. very we when have stores feel at so But is way Good on on to you relatively that we of a going performing. number about

feel We that putting took that expect Ward. charge in flow, in very our very the strongly took the And beyond. and second Mary underneath that the around – of Robyn about predictability Barnes to and that continue business, reorganization Heneen we Tamara and quarter good feel those about segments through of we two QX stability we ventures place cash the

Rick Nelson

the thanks Great, good for and color, luck.

Marcus Lemonis

Thank you.

Operator

next to from We ahead. Capital Markets. the Andress, question can KeyBanc go Please now Brett pass

Brett Andress

Hey, afternoon. good

Marcus Lemonis

Brett. Hey,

Brett Andress

that theme. in sense So expect of stay empirical you have that? here which put on staycation in evidence for makes of has Or future, the But business close Marcus, the coming The out any home foreseeable me. to to a the been consumers lot seen your will months? do attention you play to the

Marcus Lemonis

tell our is have that because that and we to millions we – key we What have at with of of traffic a traded our idea dominance, the see we of that over through us is on we daily seen our real on have from we��re website, daily a percentage a basis. web indicator staycation transactions that them. look standpoint basis seeing think I visitor believe

So on range. a to basis, XX% the historical in XX% we’re

would that, it, ask In buyers is by the to to Please in at. from that a be that three that and, believe alarmed we XX%. which four XX% sure to weeks, we’re a but to drop people at, you the crack opposite be encouraged drop fact, last, other can’t the weeks, first-time be are number crack XX% we closer number getting don’t call of we we’ve of getting seen by

substantially, up is days much online XX%. volume some lead on Our as as

a buyer through drop payments driven b, traffic, in it’s the largely convert of XX%. $XXX seen lower-priced is much funnel, of second the which as a really we’re make the by, And quarter, and the up cost continue web advertising; on first-time seeing units, terms our driving below to widest selling to that have as a, up of never in our average at that you’ll In our that expect we the bulk focus quarter, to substantially and way part month business. into and towards that see the we’re our that’s before,

We our presence lower-priced because only expensive it, not have side, to particularly into team has down continued units. to in dictated diesel but more because the decelerate our funnel the motorhomes, on decided the market invest

So a average we’re price the as the but just to seeing feel pay attention detailed dropped, overall and that percentage quarter, business, of of obviously the the which we our to buyers. more of second we’ll want first-time seeing, people trades through numbers report units, we’re we get lot has of

Brett Andress

you saw can then both little here last And do in have maybe terms of board? last that you I April for just that. was differences geographical in down could in further, that early units? a the more similarly you that thank it new weeks any guess, then and break and or positive used question you And here, May, across Very late you what if the the regional helpful, trends few same-store seen

Marcus Lemonis

in second in the executing and fluidness because we’re geographical but some the disparities York, states. demand difficult dictated are one time certain really with have answer of seeing the we that across Pennsylvania demand I’ll a by other do Michigan, not we New universally states the The same like first. country,

materially two to better almost we’re that on We’re say electronically, made the last operating the gotten but we’ve home, over – paperwork capitalizing model, remotely, we’ve years. delivering that and we’re at perfected we’ve doing not investments we’ve

towards sure trip eight sure gateway terms provide same-store but three security, while realizing assortment a seeing this over $XXX for eight under We’ve of what’s and which also don’t they inventory we’re families our seen are the travel and are In hearing to positive iceberg, really new both both four, matching next industry to to four, isolation two is people we’re are just the that of trends, safety and travel, the recent that, years. skewed growth trailers, and size the families the But we’re expensive, feel cruise, that a where a forward to addressing and month looking We theme international be are the a are the us category those that leading they disproportionate weeks. sales the park, of two, for, six is we up going in bump making six amount a years making like everywhere, is and there. potential mostly tip believe going that is that. new of that the two, in for a that

Brett Andress

you. thank Yes,

Operator

from pass Kennison now can next from the Baird. to go Please Craig We question ahead.

Craig Kennison

afternoon. good Hey,

environment? adapted this could on So detail but this I little for think, Marcus, process more bit, touched you new how you into you’ve a add buying your

Marcus Lemonis

don’t Well, some is that of in we’ve it competitors and our technology proprietary, have. invested

of differently to hold be way very with do to want using that electronically and be are a consumers on them investment. XXX-degree experience. to careful communicate to technology we things to to show tours in and And them with a so But is I able the value

very sales than did the process So it before. starts differently ever

than transact. the But is discuss around I would happening different What’s our a to arrangements even features benefits stage, different process, the process that, ability say. and is financial ability walk our with on as and them to actually Craig,

regulations the and around not allows model years along lines a that mostly happening and and city only most even transporting city aren’t that they spent home with go and are significant then other texting, importantly, across that we’ve most units state so building also our being but we done process that, And with know process is requirements technology, being there all compliant regulations familiar regulatory is comply with. to that through while finance lastly have differently, video and for delivery, that all through through to sales state dealers and the the electronically

And a is on that units work believe so us to into years, that of advantage and X,XXX Saturday. what’s process several the we we lot a given sell last three-step put

Craig Kennison

obviously, versus is come what the industry or words, improved great. you mostly That’s then last would staycation are extent that in And you your we execution? own seeing by credit a the this week To mentioned other driven back, In so. execution? lot trends theme have World the Camping or

Marcus Lemonis

I can’t comment on how other dealers are doing.

hopeful We’re the as is industry a that nicely. performing whole

that, experiencing our to original on that now, hoping We’re to a while and revenue is our the execute that SG&A we solid know other we focused the of the with. out sucked are top the same definitely got huge we’re right about right not believe million We that but just bottom road, line things. line, now, plan that make bump execution. on started we line $XXX And we business, up ground the that bottom that had million on year in dealers the $XXX and tight of was job on do the how through control

the we’re on in for us called phone any people capturing last the that unturned much years. going particularly of of rock well terms to as know the as market everybody share leave me know Most dead we enough since can, two to not

executing are their that we SG&A now, to our and of likes be come We again. customers’ our experience. to believe a making plan, the improving dead from behind. on improve we company controlling right We stay And so like need we sure margins, that focused to our on expectation

large doing doing We that, industry all as we well well. doing at While we’re is better. the hope hope just

Craig Kennison

to changes what with finally, to you orders the any you prepare months? few for are doing you’re what just next And your big Thanks. to then made respect Have ordering?

Marcus Lemonis

manufacturers. is we relationships will special What with tell key have I you

believe we demand to have chase satisfy we marketplace. inventory ensure inventoried. the of amount here, possibility to to could enough that is believe to the we that us marginally understocked? properly We inventory are come. are system the categories, that in right the as sit certain We going making if we’re demand our in we accelerates, giving leader that there be a that and are Today, demand order we we that sure Is

we’re potentially. with units. do to do days, to dealers in, of worked closely with in we month-by-month have manufacturers falling week a those day will I that are to XX working manufacturers that the ensure putting and gobble and week, we by Yes, not continue know had off number off day, And that orders the that. the by to we’ve inventory fall units up, last But

Craig Kennison

you. thank Great,

Operator

I [Operator Tim Instructions] question Securities. Fargo Conder, Please to from next will now pass the go Wells ahead.

Tim Conder

I you, Thank buyer give new good missed this, just and just what again, and used if where used, buyers the I for is missed in it first-time mix and I if it, and Marcus, us apologize your couple A and are each for ago? apologize then could here. year a first-time was buyer that who the repeat if afternoon, maybe that gentlemen. or I new coming year-over-year, you

Marcus Lemonis

number to our pushes, happening guide what with internal happened the that only are relates The as second not the we’re trade that determine until that trades. is units metric the quarter the prepared completes. of details it available in the to way we quarter discuss to consignment trade that auction second to of us comparison So use as with to for we we historically an our transactions have buys,

have could only don’t to the strategy, determine of million that to is people but deploy used in had XX go seen, much it’s X% crank manage marketplace to last lead to in we’re days, to to our analysis, level out in and seeing less than as XX%? believe we we to yet which up with strategy data of have think we’ve it, what XX used about and and we XX trade going us we as used $XX we’re we’re Do how We our some So that trade Tim, transactions the when can. or support use the of about secure historically the number come bump. trade, points with

used inventory out able either of As example, $XX business. dealers/companies an of or going buy about that we million from we’re were to closing

So data use it, but at the we’re grabbing we in marketplace specific out necessarily the have number we around this don’t moment.

Tim Conder

Okay.

So make just I understood sure right. that to

drop the trade. less a are XX XX So drop deals to a you’re of are XX% occurring, points seeing XX% with coming of of to in that

decent would turn, portion that, that first-time buyer? you a So infer that, is in of a then

Marcus Lemonis

we’re to solds when trends trends when party. positive assume get in the also retail Sam noticed that private have on person first-time we look in question Good would a unless we it bump the buyer, there’s do And positive our But a ask at that I are business, a our seeing we’re people in that we business, when it. so don’t seeing doing we nice retail.

been double-digit the well. positive fact, In in weeks comp. up as comp is website our business retail two last And positive business has our

And buyer not of have all the buyer. we a we those see so to believe experiencing they is World they have has had returning first-time that, types that if when trends, that Camping that may goodies were

Tim Conder

on little bit XXX, Is used and that’s you’re touched used maybe side, the clearing something out so looked was at comp. okay. there sounds Okay, And growth we that going XX year I margins, given there. market two just to said, the year-over-year? so those is reasons? just the But relative aggressive versus like One, two new to the Or you was year-over-year the a easy new a to on gross up on tight having were margin used guess, speak used it what you a in it the your basis. to Are an on more last the inventory, else be new on the up of, answer things. new But aged function there. used new, that if in was gross you –

Marcus Lemonis

we were wanted calendar to and hit we the to investors One, our margins two things. I them a XXXX not think you year be to year. over those on committed new get ago, our up what

needed we commitments So that. do our fulfill to to

on more we’re because getting we about a that the and need on today, the company, get way going experience out products changed the changing service experience have the on services. we that, at and road, understand with and the of be less holistic customer community and to need way going a and to we’re we fighting part and variety we’re our price they focus of market they As

were Second, last year. margins we didn’t believe bad that our used

even used, modest we’re tight in very, zero it increase we with. myself team And know so as our used. a aged that constraints pleased aging Remember And have tolerance have policy included, very to for our relates policy a I around and inventory.

And so whatever the loss to so be is going turn to it, be it.

And so in to more same keeping we March, allow used inventory to the We still things agings wanted of been may aggressive not blossom. at those the pace latter part move in have to slightly cash turning, the moving our And decided plan to do original discipline. what our outside effects manipulate keep what to on inventory our and was our is we focused stay let fresh. not keep to

Tim Conder

if so in points X,XXX X,XXX the that looks new bit of hard then back more on next any Okay. how thoughts speak. on look and two little XXX about what do several to higher wide spread basis that spread, that. you to plus? a than Should a maybe the there staying couple that annualized And it new/used of was I I basis, in mean lastly, The you see narrow? as as that X,XXX, stay maybe three years, get do spread points. kind back next is, than to or on XXXX saw like say we Just call used basis margins. year this over to you QX see to so How – anything, that years? an the Should go is year that But over years,

Marcus Lemonis

in the make healthiest at market means the wider that to the speak is well of performing odd is in that probably so gets, it the new because very you’re way, health quarter the and of In doesn’t gap the we’re for inventory point which The is seeing to a unhealthiness gaps it because is relatively that means used industry, there’s a strong it first right here speak margins and gap on necessarily it our point always us side, bit used a money, could premium. fact, the the of is get to isn’t price the industry new ability and means the compressed industry easier. We like the drops an it it the procure for more that to healthy, them the or overstock now. a little where there because

the And fact, used it is very competitive. if looked you in marketplace, at

We’re leaning million active also continues deployed able into X to our proprietary to person we’ve that database heavily into has NADA on and with any that to on data used it scraping stores that. XX historical appropriate years out value number put the throws But our our of historical we’ve data. along to is that Book of Blue grow that that marketplace fully algorithm use be company tap only based a used

the margins giving with is today. velocity maintaining new to and most different dealers our you’ve seen along the our today, in business, of America. of And us we’re ability helping actually way in trading acceleration the than business used our process very an is units which reason is used So more the procure the for relatively

Tim Conder

Okay.

you. thank Okay,

Operator

our go to Brinkman from now next JPMorgan. Please go from We ahead. Ryan can question

Ryan Brinkman

taking my Hi, questions. thanks for

So that more the the health be infection of passed? has lifestyle social risk? light immediacy public might just lifestyle to you to options even travel, First, after makes pandemic now relative think and the on could do crisis et how vacations, by be other we and longer cetera, get impacted think your the attractive RV in as of distancing about thoughts recreations income RV of term we RV

Marcus Lemonis

things. I think there’s a of couple

THOR the to younger I a in Prius to one, that designing able for And started enjoy like already in think buyers sizes see a smaller with lifestyle. number being lifestyle I complement the manufacturers have RV buyers the last proactive we an Forest and that and River to smaller weights XX person into units influx new of really allowed months. and be

So that I’ll that. start with –

risk could I one be pick its as a a profile, $XXX, the be that business the world want what now, because to the here, if I social in I Two, while can’t right and provides think sit to RV of other I any both in the in is for allowing $XXX business maximum. distancing to from affordability, at financially month, $XXX, industry be

in that to don’t so I to don’t and go believe go are pandemic, don’t country, from moms industry provides to their while that, to I’m But I I economic and with the households important for time with need allowing I need RV on the foreign grandparents wanting an don’t the win, separating how And know And RV and be be to go time airport, a our will go the to people families. to again. and to into and need in need outdoors parents a kids battle separate we cruise isolation, a ship. to hotel, protect we

going camp out slides. And people because been you’ve a enjoy feet of if feet community to of and them. today, campgrounds if between them, of distancing site a is six campground, already inside of ever more with laid they’re to in least one they’re six the The distance way than another at

and in country, anything the provides not seeing time. freedom doing And no on There dime, provides is isolation, affordability. lifestyle doing America, industries that industry it doing it so in it seeing boating, not RV affordably, on the it own else zero, provides that other leisure the same none, your own this your the

Ryan Brinkman

a itself for thanks. sounds That sales. industry it battle, economic And helpful. Great, as was you say, Clearly, is headwind the unit positive. based big very by quite

economy have I recent off. manufacturers that contributed soft was to seemed though, for XXXX the in rates years contemplated there were higher – price the for the think in tariffs, to potentially were strong, that leveled like higher broad macroeconomic of having other the sales because industry some activity, XXXX Beyond drivers interest metal when

RV Now all hard to and that and of much possibly metal if you these rates attractive down although other lower it’s wages incrementally talked gas just year stuff next? you headwind I lower and for think you RV about, the all you hard, tailwinds and from interest stuff, you implies with diesel down got do got lifestyle prices costs, what hard, industry know. add this had more this and then some unemployment But

Marcus Lemonis

two process also reasons. not primary for I very for the strong, manufacturing allow the to said the the overall. through previously but swell inventory plants We overall our to industry, to this we we be demand know speak from prudent continues entire partners down can’t I are reasons but shutting and to manufacturing complement consumer being hopeful for the the

that the tell the to as here just-in-time vantage orders, a don’t in any the and I’m take it, with and of to was and basis good it the to factory support you, we years a I to manufacture product position point, data on yards were have to margins manufacturers yards are in from clearly to falling. ago two were opposed and do inventory, falling short where sitting my as

what the inventory, manufacturer feel fresh to and community, for to in the opposite much plus-plus with make be relationships, but going did, we’re were think to we to will take here XXXX. the dealers industry I you’re in overall they very enough XXXX, see how being an the those were sitting thoughtful good in And the to separation margins effect to complements have-nots go We dealer manufacturers, enter right with and a the what be now, who and like have rising and to between going were they with clear going overall. were they going order gas like smart to RV

Ryan Brinkman

Thank helpful. Very you.

Operator

question now from can Mark ahead. Jefferies. from Please pass Jordan We to go the next

Mark Jordan

distressed the about inventory acting Thinking landscape, in you general, are in industry discounting maybe any afternoon. maybe dealers seeing dealers environment? the irrationally? Or other Good are current

Marcus Lemonis

it. have to April trouble empirical XXXX, make with plan don’t in the would March in acorns any get a I could sitting any in a usually, you enough – that be support again. struggled summer My dealer the isn’t break of the haven’t be healthy, that’s have that amount sufficient I be. to there that cash to because would could I and data floor is and for imagine No, facility to then ability and through winter guess able

like may maybe did in because we have months full the they didn’t weight normally bank Many struggling in XXXX, didn’t dealers, unfortunately, all margin the from and XXXX compression, the into what be on. with going that then get they March, coffers enough of cash we’re hearing, April suffered

everybody can get had and we we that survives cash, that through but blessed a of they just hope We’re this. lot

Mark Jordan

do conditions, maybe prolonged too to how go? sort is not be recession, kind at industry economic of but And recent the great. of we’ve where you Okay, do feel a seen if looking downbeat, demand feel you positioned might

Marcus Lemonis

in wars, buckets: a hobby. it living, into It’s has that through community the terms of bifurcate way three not I’d and installed made the of may be, number in people lifestyle. size recede one, whatever file it the recessions, that depressions, a don’t they are ever of

number So that’s one.

the expensive would lower-priced harder be dealer be you down. end, little it cost gas of a lot that than the a units driving your it could through the push I the will Number if and a two, on think I split average carries more are you’re And motorhomes, units. it diesel spectrum, if between higher

a is you functioning from $XXX, and you’re behind a from algorithm and lot $XXX afford understand strong I standpoint, If an a your unit this, think from presentation used sensitive in standpoint, be a CarMax standing bucket lower you’ll game, I was then okay. less trading standpoint, a like from the if to, standpoint, can the month that

of lines, If guess you luck. chalk you’re outside those I I wish

Mark Jordan

and just say same-store if the one, Okay, could positive? correct previous through last that I negative great. were it of some since comments. maybe to Is sales mid-April one have turned clarify And

Marcus Lemonis

think, first same-store For on the unit our sales quarter, a total X%. around down, were basis I

was have – happened. couple real quick. that have basis of a driven don’t been what positive look not X% first significantly March. number first was negative. the that weeks in X%, then weeks quarter, and me I of handy, but at between it were had the happened closer just through that Let In we same-store me, sheet same-store of down April, of specifically excuse because my obviously, on would the two a on basis, And We last exactly

heck, little or is to close we’re to close While going for to optimistic just as to flat even hoping try try get get maybe back we’re our plan. that to like bit internal That up down, heck, to a we’re flat, as the second quarter.

there. maybe going try but we’re like probably to to optimistic, We’re heck too get

Mark Jordan

thank very for Thank my you. Okay, much question. taking you

Operator

Capital We Markets. BMO ahead. next Please now Instructions] question Thomas, go can our from Tristan [Operator take

Tristan Thomas

of what do I $XXX you just recaptured already? expect percentage to of think think wondering, million end afternoon. you beginning sales, which the good was lost you do then million April, you’ve $XXX Hey, of at what the you And March, to recapture?

Marcus Lemonis

$XXX I heard loss, the apologize. missed apologize. I last the second the I missed million I but part. of I half.

Tristan Thomas

I recaptured kind how And moving much to much Yes. how you expecting recapture then forward? of just was you’re have already? wondering

Marcus Lemonis

I’m year. get for some positive to being just of gone. that’s a half in we now, it, could the recapture of thinks of we nature hopeful we’re saying right My the the to sort that numbers going but can be business planned on it realist, And forward back type looking

You the weeks can optimistic hear about and have looked voice, couple in like. the definitely my I’m enthusiasm what of last

enough could prudent We also head, the came side resurgence those enough know just we what a information. know don’t I’m that of cause. virus the trends in have don’t But We like virus the understand potential what to smack us could and the in don’t much macro be.

have year. don’t half clarity second up you the the weeks I right two as we think just But to back bad because little we of should pretty that of here beat bit got first on give second through the call, sit we ability now, we in quarter do be the April. as to – we’re able we the a quarter to our earnings more through get and

Tristan Thomas

one I more appreciate that. Makes sense. question. And then

percentage Do recently? campground. regarding how been And open? that’s know you trending what you’re Just then

Marcus Lemonis

are matrix country them worked county sort for the our by around of state, and by state information. some hard open, members county, give we’ve to will Campgrounds that create

learning, know, As all like by the changing this much is you information we’re minute.

to parks, know our are, that to know campgrounds again, social open as guests opening the sand working we’re hard certain know up, their we good in that national can, safe we are and make there’s distancing are we updating And that particularly so place as of, measures put even we to up secure. thousands which but we that often parks are they’re sure starting

but prudently, opening hearing We’re they’re it doing up it that and doing they’re they’re responsibly. them

even a to would consumers we want couple and counties before weeks solid month have do, campgrounds the the that there be we them when to opened. capacity going local social to states the to of want based see enforce. think to that And or it they have I limits will good will are distancing have, the on majority be of a measures to going

know. So to I when think with we’ll capacity back do be full don’t I campgrounds,

Tristan Thomas

last question. Then it. got one quick Okay,

government in like that synergies other really organizations to quarter? the of sales Regarding of or local kind

Marcus Lemonis

anything We materially. that had nothing our quarter or up make down a amount, go would reasonable

Tristan Thomas

Okay, thank you.

Operator

Monness, next Crespi move Chartier, We and question can go Please to ahead. now Jim from Hardt. the

Jim Chartier

talked get Do it the for are EBITDA sales you’ve to current to target. drivers where guess to back vehicles? gross Thanks opportunity What the about margin that? as taking is get I that? Is increase Where my need past, X% margin think the sustaining significant Marcus, to in in questions. a on I – a back the to an big there? you get the

Marcus Lemonis

quarter margin quarters. EBITDA our that is one even in tough, and always considerably. aren’t quarter And Well, think suppressed pretty demonstrated look, of first first first fourth were the we I improve with to best revenue, our the able we our our

of ways back we for for in opportunity look those us, get We’re one continue pretty to get quarter investors that the EBITDA the we our a second expect to good going investors. margin to believe the being of picture deserve to to and

I it with to other And moving, at of minute. whiplash take the and of a the things it, can are it’s that revenue at you this hard and day, us in going the appreciate end sort all is moment, know these

month being April. and believe return thesis structure two on outside to an believe down will to make it public we our annual of we with what the because for to we variable had that, That’s first only that the is of shot had We shut weeks an profitable of the We tell and you. that we’ve being margins Here’s almost of to virtually the have I possibility basis. April. EBITDA done cost what ever X% went possibility a than more when in

I think we to get can we Do be going there think back tough. it’s XXXX? in

we to, get we’re want any tough to because to improvement not just get of always it to get inappropriately have back are our we would the to of to for margins. a anything that a to swappings because would hoped general back I those granted, control. level that marketplace where demand XXXX, been there’s we possibility outside or doing our think there’s it’s on have just of going trends part, returns for those that macro room EBITDA be If at then

the about our for when plan, the However, consistency, our the to the believe adjusted that of units calendar adjusted structure, our we XXX,XXX is the that the delivered one fixed confident I a eliminated costs, a performing year that poor closed adjusted I we’ve pay in we that those all retail margin marketplace am quarter, plus investors have thing of and level returns, us cost out industry, expect expect we locations, them shareholder the normalized as of as range moves return those a largest to EBITDA should made, first environment, and coupled shareholders that with yield themselves.

Jim Chartier

the kind first-time the Thanks. think with rate on are than trade buyers that of drive And higher? just your then buyer? better Is F&I couple And peak factors you can out could over I of that historical F&I if Great. no quarters. another. last any has ask Or there flattened penetration? is that

Marcus Lemonis

we of I’ll to make when in front-end and regurgitate partners we’ve for transaction. worked transaction. sum consumer advance giving margins, I hard half And way quarter parts type look of team annualized of back improve transaction the there’s last only not we to to and inventory of things that. our that the from single We and and with turns. with the to our we obviously in at helps the banks and look marketplace worked the We’ve do holistic year years. and manufacturing of in our have to We profitability segments which couple competitiveness, first the improve of look the the at our avoid out believe eliminate gotten transaction as were not last the rates that us and what aging, the it. We’ve money, that pieces, that’s we total, so the at the with a know one worked

create transaction. combined single things All of those a

here, front margin If The margin. your that way materially F&I of it cost we focus margins. strong It here, have that could. impact front the a used, the we on at may number If which come the it doing. F&I grows could grows is end much the from we’re from potentially end counterbalance

We continue average we’re which to units, of cost drive down the doing.

get which continue technology done, our the turns terrible We exit the we terrible have to those they segments with to and better. we and and we continue that margins, believe have to tools train need staff

plus, Because the at in either XX% our changing people and the whatever operate with a operate stores management process at and look we end subpar market. eliminating margin, looking we’re number margin XXX performing will there are you on the focused performers. level. bottom retraining right look bottom at, What now are or stores that low top But we or management, not front the end changing and performers, or F&I there are is at the

Jim Chartier

colore. Great. the I appreciate

Operator

We from question Please John from of next America. can ahead. the go to Bank move now Lovallo

John Lovallo

RV? and think XX% an of do at we move purchases, the into forward, mean me past think about much that Thank that guys. pickup in as the is such pent-up over plays giving teeth numbers, these a sort or I think think of we’ll heading for past would Hey, which probably that, here. recession, kind tomorrow over then how in I the is as markets if weeks, how is Maybe into encouraging, starting, see orders month? the arguably in discretionary you just clearly is of few you from economy stay-at-home And we you the the the demand unemployment payroll of demand greater

Marcus Lemonis

Well, month. are us But do, consumer. the discretionary when don’t of see most as of people a I purchases it’s psyche really definitely discretionary particularly the $XXX as part

not think I people’s So is that’s outside, is spend our number money. one. Number two, demand favor to in to pent-up what demand also pent-up get working

businesses those will of you work. back start we’re when of to, allow up while as the many look so when we’re the to unemployment, going to open available, be states amount them devastated that again alternatives by hopeful at And employees hopefully

do on most global leisure we do capture our the number lifestyle; do we and win to attention our to one. don’t and play them to financial what remind do want the how affordability away and is maybe one and about either from two, three, to we So industries, What them doing the we after competition. focus to capture What educate importantly, or against of consumer’s need number do other need on to predictor business want markets. we

I in unfortunately, were not in unemployed, half when worried the history, heads of buying are And people those at still and the more and than and the working. have here May RVs. sit and because shelter-in-place states, we’re day, are about people because they’re XX are orders biggest company’s they’re our weekend exist, the home million end the the things we while And think scratching we

place been And so go we’ve right educational at the can our educational time, We’ll technology message and down. the social that to we on we with the digitally to our think message and very mean consumers that to through playing inventory active Does Sure. media field. that our ability right have right that at along the withstand the recession? deeper communicate unlevels a

going are put will down sisters leisure and on go line I that from doing to want have Europe, The environment no riskier, possibilities business or the our that I than more our stealing light aren’t to question don’t know are to Walt expensive kids of numbers is, them numbers, Disney All other and we’re and and them. from that is great if we industries grandmas and moms that our less the expose any and in. we we’re like we’re cruise in from or focusing have feel idea. daughters

John Lovallo

think buy traditional RV somewhere, who vacation And on about home. a versus go traditional or helpful. vacation, getting a if we don’t most people on going that’s then an airplane, Okay, vacations

So of factor rentals that do mean of renting in to the think you home? folks into more vacation these vacations, extent lifestyle I like the traditional similar RV kind equation, embracing how a are RV lieu that the

Marcus Lemonis

go and it football has fueled game. who to to That’s Historically, it of tailgater by the is reason And been. poor return the largely because supported on know business the ago, in we RV visitors visitors, not modestly wants exited capital. RV fueled we we rentals were the the foreign where by years have rental and by been foreign that

– if that me but we surprise when wouldn’t to from surprise As technology we Camping rental it if think RV. the brand about me away the Good the comes that it we most to it, wouldn’t of World business, with enter alternative is America, at platforms stayed possibilities along us Sam a way. the it thinking we space in consumer trusted allow different in average about looked

going you’re to enter to to lifestyle, if you’re World. come RV going Camping And the

a educate that If lifestyle may lifestyle to in RV about technology to it to advocacy, way. It to look you’re as different next yourself a get unveil for nontraditional we of XX Good you make if in me for the or the wouldn’t platform want company Sam. the or enter look a kind going information easier months, RVers surprise and

rental company requirements that do a capital we the people love million that the enter database lifestyle, RV to different that Sam they in but want Good million don’t today we have so customers that provides, XX And in X members over active with, about inventory the and to we leader want something be think space. to may and doing want X that million our do own

John Lovallo

And one I may. it. one, final if Got

I You’ve think business new have that for Do you case mentioned. this number your retail on outcomes a base run you industry economic scenarios a assumption different units year? for of based

Marcus Lemonis

the visibility the don’t manufacturers. or into enough because we of have don’t rest We the marketplace

focused only really We’re on business. our

John Lovallo

guys. you, Thank Okay.

Operator

over, no the hand time. Mr. call I questions this are further Lemonis remarks. concluding to at There would like please, to for

Marcus Lemonis

very support company. to much for Thank Great. you continuing our

aligned care believe goals, earnings, the seen importantly, off anything the preserving As our shareholder, our largest associates. is start. is like relatively continuing We’ve of clearly to taking experience, improve a never customer and are second most We the this. to which cash, we in building odd quarter

We through the favorable as the through the year. and results perform expect of balance to we report quarter continue

you So support. for thank your

Operator

call. your Thank you participation. for concludes today’s This

now may disconnect. You

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