CWH - Earnings call transcript Q2 2022 | Camping World Holdings, Inc.

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Operator

Good morning, and welcome to Camping World Holdings Conference Call to discuss Financial Results for the Second Quarter of Fiscal Year 2022. 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 written authorization from the company. Participating in the call today are Marcus Lemonis, Chairman and Chief Executive Officer; Brent Moody, President; Karin Bell, Chief Financial Officer; Tamara Ward, Chief Operating Officer; Matthew Wagner, Executive Vice President; Scott Jensen, Senior Vice President; Lindsey Christen, Executive Vice President and General Counsel; and Tom Kirn, Chief Accounting Officer. the to turn now will call Ms. over I to get started. us Christen

Lindsey Christen

business, afternoon statements repurchases, may A expenditures; good and financial and covering incidents; dividend yesterday the those strategic impact trends; of materially borrowings; with of capital financial our in Investor and remarks on statements such found will adjusted and measures on you, them. can financial referring assess our quarter adjusted as XXXX non-GAAP meaning expected our press our we made other of press noted. our on results results a release are call future as stock discussed important the morning, results customer to issued results Securities Private and release Relations important of the also XXXX Thank believe section initiatives, in acquisitions our and liquidity cybersecurity call disclosed company's COVID-XX SEC. covenants in only inflation to indicated to our statements quarter and included those our our these results our everyone. file statements XXXX XXXX. release quarter our Factors views the be business financial turn second copy as the second abilities planned the the call, Actual goals, was these with section a increases share result our we the conditions; most differ potential plans, and remarks of contain include on earnings EBITDA, reports forward-looking recently in on XX-K, our financial Any XX-Qs against performance. to may may undertake I'll payments, and of Act of non-GAAP per various and may today, now be comparisons and represent These compliance to the the second on are be impact from EBITDA, earnings comparable today's condition; by Form industry opportunities; today forward-looking performance. website. financial Risk factors, of over regarding including in unless the financial Litigation directly Form measures website. financial All Management's Reconciliations the operating Please this future statements our GAAP obligation the Reform we note that of investors diluted, anticipated no and update to certain market within company's Marcus. which otherwise

Marcus Lemonis

feel months. quarter for help for XX of going on Thanks, periods par more we've quarterly financial start, that but Linds. next strongly the for call. some some used RVs World's continue a new to that off best Good insight results of sale morning demand We be offset RVs difficult to of the providing did last to new to I'm trend find into and XXXX Camping will with to the decade. lay second little results used and that. expect conversion out earnings us with and that our seen to continue, in thanks our joining along demand continue Today, To be

the pleased roughly next on Our focus weighted heavily our while months' revenue our above for the key $XXX results to we're record roughly XXXX second And $X.X that with we million XX,XXX quarter a know results, RVs. XX those results. was setting delivering nearly a are billion, items while was

the the at start I of pace context. and new address total the It's growth First, look stores inventory metric new acquisitions, important Because that's company's inventory. item most mind. our to important little location. one is with of lot units we to been of the between want everybody's by number That's on a on when important analyzing

very today, new about the years I'll number in current between coupled is approximately with million. count totaling levels, XXXX XXX same XXX, XXXX very a were with down per manufacturers around we That units with level a with solid last average that compared demand location the we're to new around confident $X.X position the time with and The XXX. that As location our in which levels, on-order average and XXXX XXXX are point our this is six year. our per new units averaged Look benchmark. unit a XXX position. of to pre-pandemic highest consumer

it today is as inventory quarter. second than the Our end $XXX lower at million of was new of the

Our plan more. that reducing even has

million. As both today, $XXX we plan facility for approximately and manufacturers, appropriately our both complement and Look, production of floor key have levels production of availability Thor adjusting Forest we days. our River under

much as only results key business, the demand. our against our around category with in continue as we new months On used we'll not side, the possible agent, a but very a in hedge to build pleased are further last very of and this growth reductions XX

units up we For from XX,XXX million a million, sold used for the $XXX ago. $XXX quarter, year

XX the quarter end of at on months was revenue the $X.X million about the quarter. up approximately previous trailing Our from $XXX billion, used

trailing QX, nearly of year As was a billion. at XXXX, ago, sales $X.X used a XX-month marker the end our

We sales one our period on that company $XXX million So billion. as achieve to $X is increase. of a objective steadfast a annualized the remain growth year about in used

should with that we build range. opportunities unit discussed about months, next key our we to to of focus choices. on our our slightly acquisition continued reserves We demand share a We that experience can our the plan cash steer a feel to gross During hone optionality main six by market XX in deployment areas. profit we can to enhance other to coming over previously the pressure within and capital reduction want the few continue a we more while we based way. the We total experienced Look feel X.X%. quarter, new historical could per used stay months, believe

continue leads levels. and XXXX traffic outperform web to Our

while to our mix to launch diversify focus of a to that ensuring which with a nicely our new create digital strategy better pool best-in-class want funnel active million customers, opportunity while with months. want and Good service we utilization. We increase the our widen service consumer RV accelerate importantly, and over conversion want acute to increasing our revenue also income towards utilizing expand the our shoulder rvs.com. grown recruiting We nationwide offerings, the rentals, X.X national number season product of has very most talent only categories generate to with bays, customers full market of last And represents affordability. want market both current conditions but service database training, eight the a with and We to prospect on we Sam technicians creating advisors, not very initiative our like

As downturn. any of previously, business the Number acquisitions make to in we’ve said those opportunities decrease. valuations our market for to us increase, specific ways acquisitions tends benefit one, during two while

More importantly, and our two, service includes business, those business strengthens. our of talent used Number parts and core Good base pool with That business, acquisitions. our business. our Sam our expands installed business, our

top we philosophy. the increase investment in shed key of past, our that about component of certain must right on. we’ve is to to mind. environments, our know In make our and people what SG&A a is control on We the the choices in moment, what spoken increasing investment of in management tight As this

Our brief summary. financial

we a for $XX.X the million million, increase Sam an million, quarter our in year. nearly some $X.X our last from from continues of revenue increase the revenue the while to $XXX to business quarter to for increases same said I period billion. second of vehicles, And As $XX.X record Good in prices core And earlier XXXX, used grow as the year-over-year generated the $X.X increased an well of attributed rise new previous year. million business

exclude sold Our the the business, parts, in when and non-RV end when that of you actually those. products by quarter categories exclude other quarter. for reminder, as quarter those of XXXX exit million. of third that service, we and up We a the got generated the of, second you the categories most services out $XXX we were And were

$XXX.X $XX the was The the difference margins. of quarter gross of second EBITDA to second due quarter EBITDA highest adjusted the that adjusted for company, our million, million. than Our the lower primary of approximately totaled by but lower inception since XXXX

XX.X% One metric predicted. namely revenue for It’s profit important different is $XXX.X approach it that quarter gross the had pressure, margin our or variable as heavily in our structure. compensation. under come expenses, the we on was a but was margin, focus down we million, Our that previously either from for as to we segments cost maintain variable us XX.X%

of of gross, we cash percentage our were account. $XXX quarter, our expenses, the balance SG&A million cash the that were period XX%. a with plan For sheet and floor as million of We offset ended on in the pleased $XXX

an of associated have mortgage. without also real We million $XXX estate

We’ll very call overall proud improvement. we result, but Q&A. this now for We’re of turn need the the over recognize to constant

Operator

Thank this you. gentlemen, a [Operator will Ladies and be Instructions] conducting we time, session. question-and-answer at

Marcus Lemonis

Okay.

Operator

is Inc. question first of ahead. line from Imbro Our go Daniel from Please the Stephens,

Daniel Imbro

for Thanks congrats taking quarter. and questions our guys. morning the good Yes, on

Marcus Lemonis

Thank you, Daniel.

Daniel Imbro

improve And discounting remarks, start Marcus, to is I'm in topic that your you like provide this keep you you of started efficiency maybe context environment? you price there lower the independent working those Can doing the you And you per-location try I inventory to much back on do inventory. think I I sales. to would Obviously, using lower anything lower some driving prepared impressive are a you both seeing the want or can to curious still there the how out to wanted dealers down, maybe half. with any whittling to on think in basis? that that? be noted on

Marcus Lemonis

of on. think, things focus I Well, a really everybody couple want we to there's

today, where with there's the it. as number we're pleased to a new at we're on seasonal While lot, adjustment units of of with the

that third goal head But And of end the the lower that go drive is so by we the in in quarter, usually rise start mind, April again, timeframe of into we hit in in usually for pretty around what think to our the as the to our peak. as a through environment keep quarter. third peak normal quarter will number find fourth balance preparation where and we we somewhere number will decent we is XXXX, be its

and could terms I this I grow. while right started And that, are learned have try to don't going order chase build really we the start On number exploration hoping ago really But think on we've and helped us year. you Karin remember, that to learned months a from expect we we're we seeing a And lot have quarter that our the fourth normally us to to what much side, XX with as new would product, growing build inventory. started, into hit that drive pleased. if we're prepared for year want locations we've don't the actually overpay used opportunities take has revenue, we and and the where with and We cash point, in used the are. of used this to this if of third a right to the we about to to next would next at the crescendo. the on point lot, side, as

And mix so, the sure analyzing inventories the adjusting we're and lot. of making the inventory demands, market by also combination there mix. on average on the of is location are XXX those If more right importantly,

quarter, the take both the new at side, starting some the at right adjusting at the in we quarter. probably used right beginning and So price always do do, fourth for in the models right and like to the of cleansing prepare third time to the on we'll

really market pay we markets don't and inventory own in is attention relates and their and where where other it we margin our may dealers, make our large our margin. don't executing we pay dealers other levels share our we adjustments. like and locations. to to doing, on exemplary, performance enhance share And pay to and As We degree, at a our may we're want markets attention improving their we focused position, monitor certain what a to much to our while velocity own attention degree, pricing we are own

same price sometimes what which inventory market-by-market at way. velocity a looking not enterprise do across basis, it on for. we're the So us achieve we We the look the helps is

Daniel Imbro

up in broader given follow seat? consumer you thank expected these any the the So you're to growth additional rvs.com, change less rentals, about timing some rentals, drivers all seeing of you wanted just of anything from timing for that I may backdrop, the the color. highways.com. adoption your purchases? are talked changing of you any And of more updated that the on then change noticing And on

Marcus Lemonis

Yes.

really beta all it requirements market. next to really hopefully, that small on wanted And in before in understand all very environment getting make the we launch through are paperwork user national So to a end we the meeting a associated with start way and unit, rvs.com the financed, the one has selecting basis the single take launched a time year we sure to basis. the then it, of regional a on compliance by experience

like a other products understand to at most that that for well, we're has if business overall, for number of to thing our RV through years. creates user the that buyer important for that but start for look and our services you is two the we're how that can One, sure to start those making we us single drive these initiative, primary recurring of we it's things revenue we purposes. come, important to business really that there, we if financing creating with associated experience. that two, is Good lot know value When really process and and lifetime reason years we we're looking the a seamless for from single to for purpose, very them; understanding think really the new files increase do we proposition that want do at Sam we sell. create. any like at to things I And that If that the the predictor rvs.com or we better used really an the part company and look rentals every initiative looking we be RVs it of which really, feeds one is

a and to like full then a propensity then they market opportunity is outdoors, that that obviously for rentals like to them rent the do the we so identifying And way they people have the the then time. they realize process unit,

rental towards to to that on rental convert may us where service we've to also number That's we've they X-pack, unit and sale financing in potentially that our learned that and their other be rental fleet-driven, this new of own our and our purchase that learned actually XX-pack, platform, in One people put install and which right the big sell XX-pack and allows of fleet. process things to their put of again, fleet one. driving rental a unit the And we're RVs, immediately fleet is the through able into can business used carriers RVs. all two, more

Daniel Imbro

the Great. Appreciate good color forward. and luck going all

Marcus Lemonis

you. Thank

Operator

you. Thank

Our is Brett question of KeyBanc. from ahead. the Andress from next go line Please

Brett Andress

morning. Thanks. Good

or a So I would have different second to imagine that the first thinking half how of of than the bit half quarter it. many I least are about that's looked at think the us

help metric, kind the whether how So a on evolved couple months, standpoint maybe be with evolved and how just here. that GPU in the we're sales could that's business of us you and of sitting past where a same-store may

Marcus Lemonis

pace actually and those saw gap We tighter wasn't quarter, the feel that that, down last well, originally of a where quarters, We're if month. we started this monitoring last because still conditions you're trend sales that the same-store today But closely campaign, closed really used into new we rates as and get have we basis see is going month that that perspective on anticipated. to I'm where big a days comps for whole got yes, continue a And somewhat this saw margin think. are but actually to stabilize quarter happened asking we has at the we it to the from has From deeper believe, in that around the of got been on to wider and on is I the month be important gap saw basis. we been to what to through – right do the a balance continued third as we're the side. the quarter improve next on Brett, than range compression that from and same-store tea are. quite and Yes, fourth we reading stabilized in in it. potentially through really happen We able but leaves, as frankly, we're lines market July. you able beginning And miss while what our the the more up a accelerate basis we we the rise, started we've in changed and gap. the the to have quite ended little quarter. quarter, to going from And of an range so sitting had the we And where year, focus gap of the into last and similar It as same-store use. still a of the continue first the time June. standpoint, between prices of invest. wasn't a popped year would big. with What We even harder to But opportunity frankly, year on that XX we'll see a quarter good same-store is to and finished launched on a third continue again that

reports to eight million. and the we around, don't were that $XXX six of the move than XX, next here sitting far inventory would that down that data dealers We've that. less some says that really from say overall. forward RV seen what new market there. then obviously did XX, we down were today We've get know another $XX invest is results But some the expect seen we what XX. sort used it, months, of million Our to $XX it, million, study in somewhere $XXX out to million call We it, see

sure is wrong, we're but picking not share with data big we're the we're market up our pleased results. so if And or

Brett Andress

willing models next you I kind are some and… go to guess for of I put our – the helpful. maybe point it. here Got growth around just is question, any finer to before numbers That's

Marcus Lemonis

to last would beginning use the gave new down at XX would Yes, yes, use continue you I to to of what – I sales we being continue XX, which quarter. same-store is

can but Our the that that, telling outperform hope that XX. is we market is down us it's

we we XX so, we think And XX is that outperform while number. think outperforming that, can to

I the into any I the erosion forecast wouldn't so. would expect you think point erosion the can or maybe but little used As take we the of get further GPU new another I margins, margins. of material a real new down period,

Brett Andress

Got it. That's helpful.

one... last the And Okay.

Marcus Lemonis

little And to I a add color… like just

Brett Andress

Yes.

Marcus Lemonis

to a The clear it is than also more of add demand, to can had we you levels, want even we it, the just in color. I best in see that make there's the winter, regardless little natural of fall did just to we by higher that a years, regardless reason the want and always in quarter the margins curve summer inventory quarter.

likely the other that for it's the highlighting happen that's will decade. we're So than that brightly because why reason more happened the fact last

Brett Andress

it. Got

downturn, XX% just of with going And getting you forward? kind us. the is at stop of you have to think percent seen And your rates lines. back may growth okay guess pretty what this as SG&A murky that, a during were work with we I'm right? now last is then or And the those you NASCAR all something Okay. the then as costs at, along I I on an think number just is also sponsoring model, but run Gander, associated at of back the I given SG&A that look behind all

Marcus Lemonis

exceptional an XX% we where was And think our XX%, mark. back number. you if at around our normalized, the look We it's hovered business years

take why obligations. continue dollars as to talked acquisitions we to towards eliminate we're make we we and of experienced From contractual the have we may And size, find the semi-fixed, that from We're be those people, And we Richardson's made in marketing add on from big not people compensation of one standpoint, important most pivots, service make to the efforts continue to number to pressure we eliminate today, but a them shift to and housing, that food those at recognize to amount going to SG&A is side. to the this the good takeaways employees. of going our of we're members going really work which to an what retain to about. in continue We to to that some like of consider our continue to scale team inflation, look and modify needed We when gas continue particularly considerable to our organization. but have to only they our the increase company. one

did, us the raising we to technicians but where going, $X stabilize We we our sorts we company year. So that get good of and and hour, and things industry a bad our you the look service understand at this service where we raising those advisers an that times. our what need know $XX,XXX more times, managers is importantly are through

So bigger slight our accelerated in everybody to bigger paid operating the that but finite make SG&A, invest openings, to a of the sloppiness, a plan been from us branding we that acquisitions know to appropriately acquisitions and have could continue made to historically recruiting it's reason. every one our in dividends, at we marketing expect a that too how gets stronger it's accelerated sometimes but We that and of sometimes a is we've and slowdown, deciding market bad any and we've time and the of team too team pop period a that other we again all believe and cut they is time. there's chosen that for our cut the that not time. We that bench sort mistakes management from amount tough we're openings, as want new deep not And to pace fast. and our see really we continued and because building regardless store

XXX that's We grow expanded. acquisitions want another salespeople. base back, have canary, seen we've all we a closing our when in have always new we're We still when use our happening. we to canary to always opening. comes stores comes so still add market that being why it that that been to slowdown still and want XXX will because And may have We back, still

you. need it's experienced made as You was mistake catch that agreed, team, not make think at to well-trained again. I boomerang previously we've talented, a collectively we that people management that thrown And when a I will that

where deep could marker. to a year believe really about XX% average is in you We it XX%. a the good XX% sustainable margin at the – nervous is drop, start compression really So same we and increases break not in really long-term That's five sustainable things because but a get get time, it number. the deep expense would be under

Brett Andress

it. Got you. Thank

Operator

Thank you.

next Altobello from Raymond Our is ahead. question go the of Please from James. line Joe

Joe Altobello

of input have is Thanks. ASP. Hi, earlier, obviously you see guys. particularly questions couple the now up couple normalized? And taken the you will focus, that how price those a slowing held to roll Good – they've Marcus do that, back side, increases there morning. years. the with sense maybe of is the as put costs as coming trending on some over any A well, It's And affordability. and look new largely it, on that extremely past on of follow-up down, demand that manufacturers Thanks. to

Marcus Lemonis

with pleased to for supply we anybody. manufacturers, saw had a what that and cut days are in many talked many, to we that as we guys never we we I saw in with market concerns Well, inventory because bell of and production, coming, Yes. cut meetings purpose their with quarter we foremost, manufacturers because inventory, a never very but call many, and and and glut know consider when it the February mentioned prudent inventory to will know, the I again the first of have the you choice – we first that that want rang they about calls good of selling you they complement isn't all back our say

We the by I days that the cuts want the preventing point it can't have dealers rollback. right It us that pressing that are from in parts to be to because our much anticipate ASPs is shipped, think to to somewhat manufacturers. to for side, waiting lot. the provide a direct one that like pieces by the is been manufacturers between But done anticipate while don't for we'll the do don't we most they to important this goal. of job have know our $X,XXX. selling thing is have well. of as at that them normalized as inventory affordability heck and that think and other on the start manufacturers quarter, XXXX. any amount our those up. the work that's we speak here We material what and XX and suppliers know the really prices down believe up foreseeable we our any that pricing with said way we'd in their on yards from have as us standpoint isn't to our XX, based We will volume that are, then would as now think, really manufacturers in And correlation the have a one average consumers we anticipate What made manufacturers things That's ours and pressure people going we there to speculate. capitalists, those very don't most company. in are way be competitors' because fourth know lower who the what that happened however, and going what all its which a the of don't by seeing putting we We strong have the on

it. the travel their When asked, hotel see average lifestyle, into and to XXX payment. you look it's allow inventory success that $XX,XXX, is recent the numbers us travel, which Coleman ordering you reality. travel from things. we parks, in that leader will more the to When and to we like create in professional we the that on I to have airline bit sell clearly, sale to have anywhere to our around come affordable We but work in believe three people that for developing, our an it other don't between the it travel, will rate it business, the We've more monthly number entry-level We travel continue hasn't and want price because move, and to is price we only the think floor on out at a to manufacturers try great in but but $XX,XXX, we're number still the we eating America. they be attention at industry, that our one, used goal but portion than lengths, in around family think trailer, XXXX, We're sports because of – take we're lean of rises theme chassis top-selling $X,XXX especially you're top months have it's doing sensing the as shot it customer in lot are start side. a average night, at expanding a mix going had our to going I is we out is in America two financing case one preparation comparing clear that when cases, feel trailer, XXX And effect standpoint. do as getting are the to points years paying little thing with finance asked of will up to been that now value, to interest moderate market a and one they have plans, on working a go ones the in up with we that with probably maybe higher all focus. so is coming with up even really size, and diversify

Joe Altobello

Got it. Thank Marcus. Great. you,

Operator

you. Thank

ahead. Swartz next question from go from Mike is the line Please Our of Truist.

Mike Swartz

Hi. Good guys. morning,

guess consumers maybe And what harmed more there's the certain you're the seeing consumer Just that I through by from the ground. to there coming perspective, are I the some on being think pressures inflationary a wanted view out talk and of today.

So maybe in based maybe between based consumers habits. on your consumers disparity what seeing you've on maybe business, value-oriented more are mid-range purchase higher-end their any or seen you and

Marcus Lemonis

test much snapshot is good their marketplace. take in is that traffic how experiencing, The and the is a for first us of than to we're feeling. a web we're ago. the we feeling the when amount amount which And but that's one they're consumers puzzling litmus in leads been year rest pretty higher employees pressure lives web our sense, that thinking in the litmus own encouraging another create of materially to are of own experiencing test What's about or that in affordability, our

to So be for set that We take our larger the the ability indicated to by is a some which We're take them happened have around. the of lead take unit priced convert to we're and work obviously And sale to having for and lower that in to a little been appointment and big. interest in lifestyle a our to quite having has garnering people has candid, for having a what that is and transaction. numbers. people that to interest, cases interest think is But move them. affordability ensure come harder. is and that that We're to we're demand share harder move right

RV, protected an have their costs and the the maintenance travel. proper in they're affordability payment, RV and understanding isn't monthly warranty that that they have we buying it a make key the that understand they buying and insurance, to I there's with with just of they sure and associated want think the

as a their really customers affordable we we're to hard that dollar work to so not sure make the taking last payment. company make And

and things. sure why XX,XXX to make importantly, customer We the as they is something. right floor performs plan sure that more something those units in leave when want because almost agnostic. afford. a we sales used And making that We’re nicely doing can But a we’re comes with business with leaves customer all the so they organization, the have

as is the of for inventory affordable. strategy this all entire to half why business years, he’s been us focused get Wagner, important the architect who’s go really into of our which back so So more Matt the let’s year, of on we has

Let’s stay big things. away expensive from these

company how think we do new diesels? in today, diesels I have Matt, many the

Matthew Wagner

We’re under XX.

back years, right three, units So listing four we’re sitting now, on with that excess you as of inventory the the of we’ve go to modified XXX. ground. literally under XX Whereas an

Marcus Lemonis

Yes.

Matthew Wagner

that we’ve could And proven we sell.

marketplace or are of retail. as size Yes. values investment we’ve unlimited just pencil. segment. quite a trailers. installed used return the on obviously importantly, bit the the we new opportunities However, seen And see used gross travel that price simply And the capital But lower used given that’s the used us just that side, twice frankly, also within we’ve understood GMROI of doesn’t margin on the redeploy is actual retail where

Marcus Lemonis

hear motorized, above very expensive C B diesels very We really are this entry point. classes that confused be the word with well XXX knows, there’s you well different do level are classes, as at don’t ones the and still But when everybody gas. right, because with well very there, with of the and classes and motorized

with noticed being with be playing some on seems getting going shipments in have And we’ve We conflict key orders. on a of we’re little shipped. what had manufacturers game bit our some there to

dealing we’re that to don’t market have that on dominated with standpoint a have will internally, continue an manufacturers but that the we different receive side forward. side, fill from what on or so if as void. motorized need used the we and move we we we always And do to the And new alternative side share easy

Mike Swartz

Okay, something where but vehicle pandemic just structurally maybe at somewhere we look term, over you we of we above very a know and Is this new talked I were do think how you crystal step XX%? mid worked back you we’re great. is the level, the I margins and in think But think how this helpful. two, where vehicle relative Or do And going a back to where near about about be out, a to then new related year XX%, not previously? margins and margins maybe to we if get but kind surge? know, take out ball. switching play higher to maybe or maybe XXs, That’s maybe into

Marcus Lemonis

on almost discipline in management really think margin the their the executing with I associated strategy and proper, say deterioration to of growth or the all it. have large would going margin is I manufacturers that inventory and function and own it’s depend the both a discipline dealers proper

with glut marketplace the levels, inventory, this recognized really driven XXXX not margin you which inventory able have think margins realized need back the period to manufacturers just If I channel. have were to go they’ve too erosion. through by the much definition, by and have also been tighter you’re enjoy to And to in the that better going

a there’s that making balance and for good sure payments between think are I affordable consumers. margin fine

on floor the to where rates payments in making from sure higher. We’re expense we on interest X.X still are an on product gets that to particularly get investment, environment turns focused return affordable are a proper of plan for our consumers. anywhere three that need But

materially we’re to need would if XX for now XX we then margins. alike. would those I COVID type created I mess margins the than XX ever So forecasting perform I that even next was say it dealers XXXX, the But that here by near and expect term. in months months, right see not going XXXX and was and the both better months will manufacturers

maybe this here, from that point see could So we be deterioration but a nothing slight earth at that would shattering.

X%, within used On pretty tight the a let, and through side, the the range. all even stays X% cycles all we it trends, continue

Mike Swartz

that. appreciate I Marcus. lot, a Thanks Okay.

Marcus Lemonis

Yes.

Operator

Thank you.

ahead. Johnson next BMO Please question line the Markets. Our Gerrick is go from from of Capital

Gerrick Johnson

similarly about was side. points down down sequential XX%. basis, points quarter quarter were basis different, to new morning, Great. and Thank in your or But unit up in ASPs similarly a compare When the a the everybody. the quarter about first in margin question units second gross XX%, there the performance second. a first you vastly I basis you. have XX% on the you’re performance on up Good were XXX XXX

So missing that between caused I’m swing there that in that big that gross in what’s margin?

Marcus Lemonis

at quarter demand did that chain through margins it would thing the I the supply to inventory same itself and itself Did like the up in the and come fix quarter the inventory as the curve back that down. just we first first that would told repaired and the everybody end that started answer show Gerrick? margins The of December

Gerrick Johnson

still – I’m confused, Well, not I’m Because… right?

Marcus Lemonis

topic the specific me trying are you that correlate? Give you to

Gerrick Johnson

look up. your discounting doesn’t ASPs like It because went here there’s

just just much inventory So the taking the you’re is that and higher? it that price on that was

Marcus Lemonis

to is as here to continuing you the Yes. acquisition manufacturers at if I continued months the last accelerate from mean, that’s inventory, from an we us has come and sit XX accelerate look to today. standpoint

materially ago. So the units similar are buying higher. In they us cases, seven XX% were that cost to XX% and for higher some than we’re unit buy a is today months

that’s quite the for big frankly. problem a So us been big,

Gerrick Johnson

revenue quarter, members sense. makes then like you. into looks And Okay. Thank in margin on all That it Good that? performed is Sam, a why

Marcus Lemonis

file? membership The part? which sorry, I’m

Gerrick Johnson

yes. Yes, Good Sam,

Marcus Lemonis

we XXX,XXX mentioned categories, last business be non-core the fishing, people we as end We they firearms, weren’t – things, were the we core pure RV RVs. our that the doing with several going weren’t going the to who continue company exited outdoor knew because we extracting Yes. when at of year, to

quarter. believe that and normalize of the And we expensive folks. ensure back elected accelerate what file that we growth. And customers. third so it’ll file file is And we really we have and brightest itself that our to mail But we to erode those we marketing in that here to market are sending best a to sort continue will are to think to to repair to that into emails and cleanse to, communicating, as sending get to XXXX, it’s that because are

Gerrick Johnson

third Okay. to allowed I XXXX. ask Am question? a

Marcus Lemonis

ask XX. You could

Gerrick Johnson

margin, had such be in why strong understand and why would improvement year-over-year services sequentially? an sequential year-over-year, Excellent. and but growth Products that

Marcus Lemonis

categories. in were number Well, eliminated that that categories those we non-RV those

in have the we’re unacceptable we investment the And so perform delivering And that of in as exited we second on quarter consider we that revenue we return better. would margins. XXXX what quarter,

on those non-RV You quarter actually said you’re return third a the we everything. that get quarter, the plug getting pulled into just all better we the categories. is it When on

$XX have XXXX. don’t that sudden some did pressure million all of $XX third tune accelerated even better. liquidation that we of So the we will that just inventory the a or about great million don’t the But look we in have want versus thing. of of will think that revenue the in people and margin XXXX to quarter. We to And margin

about at the dealership the and we’ve how we leadership one parts, on of to the assessments, that in replacement, up had. labor a in We just three of the as acute creative we I’m in monthly as and row, quarter which our broke how are side. business, now than the complemented that other category. out nicely. solve there never we business advisors. get months believe it’s as while our demand pay team units do We just we the collision, that needing as own There an sales place. And by and business technicians own and plus have fruits have leadership an X% out growth on we dealers recruiting as don’t think accessories team with necessarily for margin that seen – about at think we enforcements focus nicely in service to we’ve to operations that [ph] One to What used mush and to we is shift I labor market, we continue you the separated We service, to we continue basis vacuum. but we saying be the were that. And quarter, where business. that bays, is believe it it don’t which to $XX opportunity repaired a a training and than the continue XX% We’ve look entire our our part service, own is However, And report noticed business. universe. think based fixed different And together it and that And of own business. have their used to think management on We for in we out the expand up look separated the and our dealership on grow we glad that’s all the that, department the And is business more a reflect. to million that worth we’re in we accessory having we get repair about pointed strategic the we made we with we’re which this that. quarter our may we’ve our way, continue parts that. to we of in we’ve

business it service even We a may, as the us it models half to that. in this that back, know which when will, we of is of sustainable XXXX, so back part or really pulls big know. these through And we year have and don’t dial support new other I

Gerrick Johnson

Great. you. in queue my for questions. Thanks. remaining I’ll back Thank get Very clear. seven

Marcus Lemonis

buddy. Okay,

Operator

you. Thank

ahead. Ryan is Our JPMorgan. Brinkman of the from go line from Please next question

Ryan Brinkman

Hi. check offset a drive the Great. I as the softens now initiative, market Uber economic record number the of to Thanks. side. inflation how might or people including like you as labor in potential think downturn. want recently on wanted sharing a that RV commented this business be to impact some the to them consumers by for money look maybe by of making impacted on

uptick spending RVs? more be auto as Just impacted also that perspective, way for you benefit a could as used from be there about pay their available this think the for to in a demand how for in curious And supply it RVs continue way. consumers who owners of could otherwise by afford demand purchasing thrifting downturn thinking participate economic might that? sort a a – an in for with to better then or How does or monetize the if downturn? to made a have Does of sharing the RV lifestyle as been suffer market existing look they from other you do pushed out newer the of categories RVs can renting like

Marcus Lemonis

you want business and into is go out what these thing the what I laying purpose to have one extra going to to trends been. dig that the and to going going that I’m into Well, rental. mentioned Matt around, there’s really that’s of point But be have RVs all that

have know you those are inventory any who we extra today. used buying of RVs, any If people

or crisis just And happened war and the that first anything never happened. through that exit through if has see which it’s what crisis continue will happened love never any as years, lifestyle discovered. COVID before sort that of the happened any is accelerate, people in into it’s there so we you to lifestyle, the winter be go I people’s want the But to think rate or XX gas of are interest any time

to into details? the want you Matt, So jump

Matthew Wagner

revenue the most Good have session, formed that that at inclusive environment. our sales, Yes, Sam just driving retail disposal, actually as drive said importantly, within as procuring was for Q&A importantly, the the rental we business of plethora of other products. largely absolutely. to used and Where RV in products, streams But scope RV RVs previously our Marcus

we are both really consumers the active not where only charging been site, prospect on for of RV owners, us Right also able facilitate on of we to we’ve into a this opted to RV an million relatively to within are within this transaction, accelerated to our that So these preference. RV share see not huge to but rental enterprise, create space, are continues prospect many drive I where have space RV we’re that and to some procure that that this we fraction active funnel. large charging should say, environment marketing sort this continued X able more sides where fees up listings of disruptor rentals in a outdoors our rates of because of procurement RV funnel enterprise, we’re for The individuals be RVs. least RVs but active are at the the we’re of We’ve for now within environment over thousands thousands with have to rental. trying the

an lot make larger, able continues to to to currently lot we’re the that haven’t investments don’t RV just want in readily these just convert app our as I in numbers consumers that able sufficient that of to these get of to it We’ve We’ll better made are consumers suggested environment, these push return RV within to yet, a leverage revenue we been and tool been a able larger we’ll value assets streams. these disclosed into say publicly [ph] own to worth. And provide the a ongoing to customers. we evaluator opportunity. the But as have what other it lifestyle. our their you and convert continue grow of available. So they

engaging see way rental the participate like consumers frankly, space a this along as I going and to headwinds do the the are what what to always RV of we same just economic future? there’s augmentation in the potential lifestyle. in an always being And do. that that consumers vein, be see be of might You asked are in lifestyle it in we in interested what

years, XX an sales, five, drive growing future coming nothing mind our the can rental see in than downturn, at even the the my attachment. And RV this over So funnel is space more in rate, RV product to I RV future space, exponential rental prospect more frankly.

Marcus Lemonis

the thing been profitability the an the today, think this to prudent I we’re to very, be about signed but there. We’ve we really they’ve that dumping have we on And would providing millions raise thing them. for We steady for to the The and in ourselves for. in while And like is to be bit. Yes, whatever not little a learned space, be prefer we is us as And improve our grandfathered a very that some competitors be bays opportunity who much value course value the still one profitable. consumers, extracting we are. to in we fees to opportunity below spend how money wanted through slow thousands, as if value process comparison opposed trying the have to these the that grow growth these competitors providing of of business. we up may not see users to we’re hundreds there the much

the that billion we on for like a for good top but build going been effects us, thing And it of dollar something a multi company so not it’s to we’re sure. giant of, but

Ryan Brinkman

asked your on Then that? anything allocation economic question acquisition How pay for you might cetera, growth than if ground more capital you’re That’s last thinking of toward multiples opportunities just dealerships with or share are tilt attractive organic it that and about inorganic Okay, any could decisions? in great. generalized you’re a helpful et on maybe to how downturn? the more Thanks. of color. sort my multiples, the you in of terms seeing rather impact of Would implications acquiring downturn perhaps what is you sticking the being sort

Marcus Lemonis

foremost, you up lot with good buy you’re and quality management a dollar. just buy not first market with than place that the to quality when buying a cents Well, more and and want pick on a you and for quantity. And we pay in good team going good can locations process gravel good share, to

zero definitely is competitors well, of issue it other consistent dealers people. them the as four pass We times. to financially dealers see value. there the have to have we going looking validates seen the are in life folks that an be those the well, to to have steady, to chose other dealers When are We they that pretty When more leave, a the think some that on. to or in other that can opportunity to fact them And there struggling because three the love to time, most our buying acquire we And the model. do times. two we’re paying we from are space buy causes

stuff. get it first usually blush we So

there’s either space it’s market has analysis. or us, about single opportunity think the us. market I really doing grow market for our white for Every to share

to as cash always ago. we’re how allocation, about I buy getting did. would to those. disciplined desire was expect in we’re been steadfast has which right is about things. pricing it now Karin in higher in be And think year accelerate the thinking spending so to pretty continue cash long we why we’re going approach we a reserves, the we’re to do take we our what CapEx, on as than quality. very same what focused But And softer us when is our about the looking is us is building capital buying we’ll And thing at if investing strategic to a things

sure making I want back, to We’re it return making an shareholders. if today. for to buying going that the we whatever that means asked about because it doing best acquisition, get that’s has opportunistic is, be fine. clarify shares And nobody our

our case about very including dividend every we we have continue, run, We something that there’s that confident in downside will that are that tomorrow. that worst unless we the know model single today don’t happens paid

Ryan Brinkman

you. Thank helpful. Very

Operator

Thank you.

from go is question of line Johnson Gerrick last Markets. the Capital BMO from ahead. Please Our

Gerrick Johnson

going forward? Hey, talk one the are Can quarter just activity plans and you what share about buyback Thanks. in here. your

Marcus Lemonis

as cash. going. We we the really team share of so Yes, to our where world without elected room have understanding buyback still under plenty was a authorization management build

we What that. use and very, do the and to capital, our amount continue every to say, to never very and that in We the will be concerned a our we environment. accretive When revenue want of sit when That going at also about we business to capital and down quarter. at in order. elected to the And overall be earnings. what’s our amount as capital at in the for identify working acquisitions look here we is closing to look We’ll a best single think choice we’re buying working make is the some in have, anybody that very priority of sense. short the was of opportunities we big of that situation where we a permitted buy it we day we team, even think capital softest looking the be makes excess

Gerrick Johnson

you. great. Okay, Thank

Marcus Lemonis

you us third Thank on quarter our reporting for second Take very We for joining call. here in look few forward quarter the Okay. to much a months. care.

Operator

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

You lines. may now your disconnect

Camping World (CWH) 3 Aug 222022 Q2 Earnings call transcript