Earnings call transcript Q3 2022

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Operator

Good morning, and welcome to Camping World Holdings Conference Call to discuss Financial Results for the Third 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; Lindsey Christen, Executive Vice President and General Counsel; Tom Kirn, Chief Accounting Officer, and Brett Andress, Senior Vice President, Investor Relations.

the to turn now will call Ms. over I to get started. us Christen

Lindsey Christen

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

and These condition; the the our in potential payments, incidents; our our remarks opportunities; of performance. future dividend borrowings; impact capital our of business, financial trends; financial repurchases, include statements future inflation cybersecurity may regarding goals, expected future market SG&A and expenditures; covenants our and stock compliance COVID-XX impact results increases our abilities conditions; liquidity customer strategic our and disclosed initiatives, on and plans, and anticipated financial with and industry recently business expenses, acquisitions,

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

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

turn to the Marcus. over now I'll call

Marcus Lemonis

today's Call. Third call, lay our World's remainder this for providing XXXX. Thanks, financial us for of we're thanks with Earnings the results, Lindsay. Good to joining Quarter and into Camping along On year XXXX morning, and insight going some

As the demand, of quarter, healthy experience a in revenue shy for generating $X.X company, we our billion. continue company to just resulting

During the year. over last being under XX,XXX unit the units, sales set big year, our with record just we the we sold record driver third RVs, compared the X% up XX,XXX last quarter used quarter, of to over

seen strong for have this of stay We the setting demand comparatively used with year, pace. time recent RV

in and segment, quarter, stability installed used by third both During as of RVs to our see growing and base our the growth of a business, evidenced business. service Good we continue result Sam our results, and

we intelligently to As and over these next strongly key you'll and them business further hear our to and XX to beyond. months XX areas months the will today, investments the profitably of that, help outperform feel very market us

the key of want side. in One side on success things used face the pressure new of this the to of we're having investors driving business in call I our the is focus on short-term on the

Our billion of momentum. substantial $X of has goal sales used annually achieving

$X.X billion over revenue $X.X year a putting at basis. our For ago, of XX-month us delivered the on over used record trailing quarter, up sales unit a billion

trailing More from million ago. figure than importantly, year XX-month higher a $XXX the

range points compared about our basis QX. margins XXX last down talked used landed told the our we As on people, than call, in we less to that

and now this stated, about the evidence The are shift our we results. the return on more used gross higher in the than is have because investment new reason churns is from we feel so faster. strongly Simply margin

that, database healthy But buy tool, as our Valuator we requires and scale. Good sell to in It to. the products. strong like is of and each capital, profitability Good RV technology, as and of Sam from transaction Furthermore, including all We possess both them. used contributes game finance finance business to a of and proprietary a our aftermarket very the parts, know overall replacement the business, service, Sam well

Much highly marketing like levels, key, approach of supply approach the new reconditioning, and side a disciplined churns, to the stringent and are matter pricing procurement, but to a key business, to more. chain the is stocking aging success,

expect discipline. maintain We to that

consumer-facing of selling talked up with it current in we unit August, offer Sam for last no-hassle outright, Since the process, owner, value, or program, in procurement of inventory, a a full Good around ramped confidence their launching RV whether we used our they're a the regardless to trading another. new disclosure strategy

over this procuring early The has period, X,XXX results first XX-day in the resulted are us units. In fantastic.

than More also category, sold we see because because hedge. a a period. it's great as only not use the We agent same in – but it that more we importantly, love to growth

In the all in plan the opportunity market to nearly hands. the new months RVs. XXX,XXX last on our remain used seeing absolutely That's us The success clear. almost leader With the change sale what happens side. is is the in used, double XX it still units of for new we're

fact, a topic we number units only the of by new of The new the of In key management. profit second side, this inventory the on XXX at location. the is is year. And key total look retailed metric in XX.X%, decline frankly, of a that margin quarter inside points, new that, excess of quite basis for the XX,XXX gross quarter with of we to units compared

QX around XXXX stocking XXX units use you average units, we're per XXX location, down XXXX. through when compared Today, historical of to the

preparation levels and As QX in for always, selling our in QX the season. up ramp inventory

We control number, more will yield tightly to to continue and this aim less. with

continues in it of predictable of database, our growth decades, with continues clear and other four the Sam products, along million our business our services and to base bays last business, that installed own it's and as business size engine That both revenue also RVs known America over service to and has continued quarter $XXX the for parts the service additional the company. As business. the grow growth of we like and growth Good quarter, for An RVs a ended steady of our of generated is technicians. the for of benefit X,XXX be with the of growth X,XXX the our

generated the Good financial the $XXX.X For for of revenue our When X.X%. the EBITDA increase million. we quarter, of summary $XX.X was quarter an jump adjusted million, into Sam

was historical between million, for Our quarter margin a was the almost slightly XX.X% XXXX. XX% still last of discussed, gross XXXX it $XXX we our but profit down we as that nicely from above year and experienced average

expenditures capital Our a of management and our key control tight SG&A philosophy. of component is

management choices, shed our to on not is macroeconomic the current hard Our currently and the making to team what to naive deploy capital. are and we environment, where

significantly our marketing eliminate reduce and underperforming to continue we'll on certain assets, obligations, headcount. pause and reduce have We initiatives

we're dividend. on making to is While growth major tough and our to plan focus decisions, drivers our our continue funding

to our in foreseeable Our deploy future plan way. capital the this in is

Our used, service and our business, acquisitions. opportunistic our parts Sam Good business and

balance $XXX period of We an cash on in our of with account. sheet, additional plus offset $XXX million our cash million plan floor ended the

In addition, we $XXX inventory. have used about of and of $XXX inventory million million parts

about Lastly, an million $XXX associated estate without mortgage. of we real also have

low EBITDA fourth at our range. expected, of patterns. margins mid-single-digit the returning from seasonal by the about and right As adjusted normal to look is one-third quarter declines business third sales to revenue, to historically are the typically around quarter the historical When progression pre-pandemic its we

profitably With as allocation conditions be CapEx planning some to based seen positioned and is the XXXX, on be continue that, might will wrong, marketplace. projections we to our we're of be If head lower that capital into closing, we focused right, on if and industry are where be in to In I've time outperform the And intelligently SG&A, the going. than we're well our we're business it wrong. will best market. the we

a stability RVers that's and/or We believe Camping growing business, growth business, by the and Good that ultimately Sam unique the because in business. service our World parts our special serves base evidenced installed and is our and business of and used it

the I'll operator back questions. the for now call turn to over

Operator

Thank you.

question-and-answer will Instructions] ahead. Our be [Operator conducting with Swartz a first question We Mike from Please, go Tourist comes now Securities. session.

Mike Swartz

to And worse made Hey, some than numbers of I add to the you we just comments hearing the XXX,XXX what And for closer industry Marcus, right broadly planning XXXX. there? was that -- in of around out retail is XXXX. to maybe back, industry to in level if view wanted think kind good the morning, pretty everyone. that your maybe, the I be, Hey, on I think, of around you're go consensus just units

that being see question is, to way earnings is the your XXX,XXX a mean, since level obviously, So we I time. the right about if doors XXXX about XX number? earnings you've added unit think

maybe there's about think to in can M&A just any that give us But you scenario? parameters pickup. any sense So some how earnings or

Marcus Lemonis

parts have our and it It's of XXXX. a grown business is nicely. almost of our than materially in Well, different was double size the business lot

talking people under lot when for it to compare a I'd think was a into learned. what down. about like headwinds like, had XXXX that screaming of lot of came a pressure, we I us, lessons always manufacturers been is, was industry was lot And, these to the overbuilt, what margins as because go really have of the

we in in look that my was errors results, the moment decision-making at When big XXXX I there that recognize in time. two

we the don't associated comparative The $XXX our our business is And that first a lower about and that back we was business. shedding our XXXX, on all when core we had had in wasn't expenses a look today in launched an segment initiative we at have basis. of that SG&A that million

in $XXX certain us weren't that's categories current I about we categories exited additionally, giving we gross. weren't those margin makeup all think, shifted capital turning then that we the deployed our that profile into wanted our and of when mix, million fast, and

have adjustment from pro I low I'd forming where And that about so, million watermark was if a XXXX, was. $XXX up

zone, that absolute and best think, related selling, financing that, to associated to addition I core strike is products In the to learned when exclusively business it RVs. sticks this servicing, all also its we

been any initiatives your when I've business and our mean acknowledges out we contract That business the in just margin XX.X Sam It going the Good its already new this business profile and of growing; that the to because at we your uniqueness to contract the of primarily pressure. be headwind RVers in services over used categories; the for SG&A, and into contract the the all doesn't years, and And on under your business have and we're that. get because marketplace because business. of three marketplace; is look doing new you period service headcount, there's it time a focused go hyper XX million that

I've forecasters do for else just our So planning do and But XXXX isn't looking fair. anybody that more at its not believe to than seen for of the down if there's data really XXX purposes we in necessarily control see as reduce company industry. I CapEx I as its to not but are possibility We and its prudent it's what going believe consumers our could published, of its industry. which any a from own XXX SG&A XXX. as shipment headcount, happen to low cash it is and down go the

If wrong, we're protect excess any this going I'm this investors going any my to to allow period our business and SG&A capital downside initiatives to but to job have is the that great. any I any new or put to because return. any headcount, not possibly excess where excess during think greatest I'm from get waste, the can we

Mike Swartz

Okay. That think of has in just year. comment I comparatively that the opening this for I commentary the And you maybe appreciate that helpful. was demand then your time on extremely opening strong -- held your market. made

the seen of can comments. there those just cadence -- you've in you specific October? context what color and So of maybe maybe provide quarter the in around the Any like

Marcus Lemonis

the crazy. Yes. include were four and relatively last in decent. kind really October. August pressure starting When We It's feel I margin the September to were at I look of and market. of the was their and we to in That's the the in our there partially reason the registration obviously quarter out data middle we opinion react. retail that wanted outperformed that months

were we or high on and seen six quarter as may down I've for that be seven the some the XX% new think, I XX%. as side data or

saw value lifetime you and compared bit October got come me compared our irregularly our We as margin, keep going when discussed. because a more we September that August. volume -- August into had back. the our spent to a excuse hard Then look at what we and July little seen. and bit September and to look It that off little you to and at pretty of volume and fell of to we came So down transaction, margins came volume we SG&A overall fell wheel

there pivot. want to that hurricane revenue. to is month, oftentimes, forecaster. and And continue the because money is weather Now we anything I to pressure that a to delayed or -- we'll don't it we a attribute to are like marketing we yielding that attribute the slight What be I'll never definitely as in reaction marketplace to in had use a when spend there

today about compression the like sales slight where us That's margin something, third somebody probably grocery between had and not a getting experienced we but happening. more in. than quarter. It's marketing in why flat and advertise lag XX-day lead tomatoes a comes store we bit the we period October, There we in that is saw a relatively transaction

fourth typically we And quarter. in do the

anything If fourth you over us a into for in history go over quarter it third about They fourth all doing that we back bit I've one-third little don't because slowest margins to come start the always we has the and want when volume than that growing rapid years discipline come days, down quarter anything the quarter is through a more, we're XXX the this look the it down pace, winter, less inventory at on more we been our around fourth stringent liquidate may always which it's and to period. carry the quarter. obviously that get is if so because the at the

over you are bit. we've the for February And able January, a months As the toughest little the repeat December, recreational just to our business years four November, that of think not been last those couple about business.

from think comes seasonal play, about talked quarter. but down the traditional to comes why which I lines which remarks third revenue there the why about we're is levels in variable historical see margin down still is SG&A as prepared starting some are costs fixed come trend into side coming on EBITDA there, the one-third to in back I down back then well. the the the those And

Mike Swartz

helpful. Thanks Super Okay. Marcus.

Marcus Lemonis

Yeah.

Operator

Next ahead. question Joe with from James. Please comes Altobello go Ramon

Joe Altobello

you guess, over the the to seen XXXX to Marcus the guys, on last much would promotional two haven't promotions. your three discounting or is promotion thoughts Thanks. good the in And love Obviously we'll morning. first Hey back that I levels of way question it like seems of in years. get environment. or expectation get terms

I So or years versus heavier activity first outlook, your could see is, question is three even promotional guess ago? we that

Marcus Lemonis

stocking excess happened than supply inventory over decline something for by new budgeting historical there that in current what unit We're because of better sale in XXXX, levels. even channel evidenced an the our was same-store

level think don't to we see going So we're that of pressure.

pressure last seen out think don't their see the started channel production a I on XX in the the started to compared months. and going there's are because we've believe manufacturers we we And to call But inventory glut pull to they probably what of in today. we that to this back heavy last February,

XXXX. inventory there. to very the at are next to to we focus to a think itself the very pressure, because six buy be control us seven we only margin level of have maintains and stay everybody on new side they on we information rapid out don't and both I'm way because wanted and this Now months, slight clear look that did some coming at tight to going profile point sale side what profitability there margins are in disciplined at the are dealers is through I fire see be when this to And expecting comes call unless continue the headwinds that But was to manufacturers used a that a a there expect going pace. pretty I to we're the but sell like want at robust on

Joe Altobello

some RV made of that rentals, recent give cetera? for et that. Maybe some on initiatives marketplace, a just helpful. like the it. you've you Got your update That's could us an follow-up if Peer-to-Peer service on example, And progress your of very on

Marcus Lemonis

rapid years. that almost initiatives our initiatives last to Well, any have at ideas. I'm back the virtually pleased count just the those and pace, all cut couple launched over we of this reduce made reduce on other on business. expect We in core to a We've investors decision decided than conscience SG&A spending headcount head spend and us very good we continue at that point to up, lock everything can't unfortunately reduced our

are and Good be for of ideas those used a lockdown Today they'll While SG&A. another it's service, business Sam day. good, there

Joe Altobello

you. Thank it. Got

Operator

ahead. Next Stephens, go Inc. question Please comes from with Imbro Daniel

Daniel Imbro

Hey. questions. for start want Marcus. Good on revenue morning, Thanks taking the line. to I

better you the consumer level same-store back expected? back it than quarter Was Was last on the in used. think XX% of to just inventory I I drove half. XX% control? you you now. I'm expected kind what said, the guess stronger that's for guessing outperformed that new a and And right half it down that? you not Obviously both

expect up like you've same-store of us rest what I October decline said you given So what seen? frame year the think was help would you can this you for flat.

Marcus Lemonis

along pricing that the proprietary our our a way pricing of drove with believe some We Yes. lead-based we along strategy, is what our strategy, with database market results.

that, we spent anticipated activity revenue that generating million, $X to to for probably In addition be to more about generated. on million than $X

transactions look database, when business, the the for acquisition customers of gives of overall And point Good value new customers. and used more a a And our or our member, Sam lifetime the sale of at RV. long-term more customer, greater health best value unique lifetime we in is a our of us

It acknowledge higher of to decision to and we our business we momentum our those we started what Good the we stop make business was feeds the Sam to understand want business, the our quarter needed and that flywheel. internally but parts anticipated, And quarter cuts to we made went service SG&A in than in that continue our and don't we third some invest as through is the our do the flywheel.

we're quarter, created value know because that back at that of in XXXX first pulling the we beyond. will going and expense quarter fourth the our long-term the transactions into the But income heavily. in go we those do breaking pretty yields us flywheel, to and XXXX, we that not as be Now,

I'm and for a stick and said face show up that row prepare for see. in to a we've quarters three to with people XX%. in environment As outperformed quarter with But the outperformance quarter, rather pleased -- our prepare that we to our my the fourth disappointed going everybody And our narrative know first we have XX% I'd I can of it. down pleased I've that and the over-optimism been be then macro with of

XX% compression. tell fourth down shoulder we are the SG&A so in on to third fourth to to to that new quarter always So our was experience seasonal materially stick believe quarter used I'm to quarter, XX%. the because that margins second just, our a and And going I'm season. our I going table, out it's the going get can you and it higher historically, than normal

years, What we in is some One and we think to I don't things. normal. generate never made And two the started costs quarter that is that want started in have for people in our many we to control the we remember because experienced we quarter, fourth and make fourth do revenue. to quarter. XXXX XXXX the fourth money money

deep that. revenue of very on point XXXX, us. to I be this So, are But into dangerous focused all we project at for would think

Daniel Imbro

helpful. color, really Helpful That's No. Marcus.

as look you the Sam. public updated seeing multiple the downturns. one used I'm the leaned the we As on between M&A. love you I channel. parts and more sellers of the historically investment, the back thoughts table, you side? service was buybacks feels listed to M&A the fourth M&A have have at I you weigh M&A, into curious during on are would Good four guys multiples buckets come stock kind on how where to think that of Just you any decision hear It But like the are or on and

Marcus Lemonis

at we low when when We're value are know company assigned to conflicted company we our being that look valuations the higher. of our intrinsic always the is

in we foreseeable continue always opportunistic everything it public when our is conflicted. from the because But it to future else that will company. XXXX So is company this an in dealerships, primary is are objective we're of baseline, our the RV foundation of acquirer we for been has and went the be

to to have conviction today ready to started doing are cash I tell to working and as a pickup come to company with capital can in opportunistic. be talked down. we those What by their Those selling our is wanting talk be see have come building the we getting have about in multiples about We expectations absolute ready you business that that all you opportunistic, and evidenced people down. getting

we sit revenue we're business, here We and that and like troubled hockey have and of thing, the a -- pay stick when an when call told our you very little our that because and but earnings distressed on at materially we it no pay this downturn a processes experiencing we we always the estate that up we we good and buy point buy But get some went essentially goodwill, tell what those And scratch return in I public, we turns we that or one today not systems SG&A, we processes yield better tighten our we managing in have reasons. a anything for. marketplace improve we businesses our capital. real for best to of at we end a not we efficiencies We we do inventory, does, businesses, disclose. up prepared cases, like types nothing times. are revenue time paid signed can our go multiple. at buy buying into two and we unbelievable low ton to the and in at our we as And of would We nothing

Daniel Imbro

for best lot Thanks Marcus, the so much a Makes of color and of luck. sense.

Marcus Lemonis

Thank you.

Operator

The Baird. ahead. next comes Craig question from with Please go Kennison

Craig Kennison

cost in comment reconditioning the scale if you average you to you maybe one business just node process. function particular talked I curious, that what appreciate business just a that, and scale and the certainly the Marcus, in it being you about then Hey have unit? being my recondition process good could I'm about for Thanks taking morning. question. used on talked that and the

Marcus Lemonis

Craig. that take Matt,

Matthew Wagner

it's scale out entity in part that Great think with Good the to that other open than any much alluding chain. morning more better ability our use so question. to supply as that is more involved getting Marcus the in commentary, there. of his associated to say And my the we source over apprehension use in of actually in about uncertainty years I reference When Craig.

I'd think like and with of you our the of drive all the upon the cycles amassed day right years unit. based cost to actually in our that that the per I to technology, proprietary a we're we've ability associated experience used used averaging tell behave X,XXX to now, our down consumers how over trade-in lead to about leads procure units. can buy

So an in if on basis. units potentially XXX,XXX we you excess that extrapolate that could buy used out, of annualized that's

And these I that the one assets able competitors we tell be out at value capital you, information our to the has a no severely else do access there. there of to reduced amount procure all to out could of compared

great about another asked that's question. you When recondition

of capacity as you tell mind been top our to figure in versus internal external our we're our can one work. terms trying So I between out of that's work

what's time behind that the we're at used reconditioning transaction, could every to these put these that effort for methodology single optimize single while And to our brand selling every us the we assets ensuring best consumers. same

age want units of just assets to to acknowledge frankly, we're also for average it's to worth where reconditioning recondition. we range going reconditioning. say X% we that anywhere on On years, because, that certain those actually there not I certain are from model XX%

over in of we're accomplish So approach confident be parsing out year. learn here get better the that long-term continuing we I'm we able next outlook the better different We're terms and to what minds, to in of use. in the should really continuing to day ways every our

Craig Kennison

there for unit you is able spot range the market, at in be of to follow-up, the successful whether a brand, you pretty the sweet age product? as the of it's are or a used broad used model And Thanks. a the

Matthew Wagner

which years to Honestly, return that our methodology know been as enterprise. because model most such the able an to we're for margin to we on are investment, where that's going able exactly to gross an lucrative fine-tune extent where return we've us optimize yield

the range, So that certain we to generalized we consumer oftentimes plans general see range floor target, of remaining I'll know brands, have to certain model about will you lifestyle certain there, that XXXX within XXXX likelihood are thereafter. understanding even segments generally within is there where a years higher give but the that but

or opportunity, don't frankly we significant that competitors at it just And arbitrage where an a opportunity. could purchase see it So hopefully trade a simply we that. turns other into see could

Marcus Lemonis

mass to sauce valuator And secret the kind and inside evolving tool an it's layers multiple of built process. Craig the has credit, it. of Matt that

XXXX going you through when in owner. owner, go XXXX you so And different at you're would the go to a a as than experience

down these on based based on floor year, based of units the Matt do make, sauce. that values just the of are or why But down reason is on doesn't based model it's part units disclose all on it our and plan, And secret want ascribed selling model to part fluctuating with And specific on over our all own vary. experience the to all decade. importantly, up to of values way based a is, more it because

so And to used. used values you've the inventory used inventory, past, And in growth our asked and in of it isn't growth some also something see we've I me seen walking that haphazard we'll continue around address the this our as want around in to thing.

And for a is, whatever or for it is or those valuator oil, single values year. formula. like down, the of every day may for commodities demand, market corn, it's they daily what would dynamic it's The time for based up on be are coming and means that on based

may today, buy paid have less materially we something And so than did we when yesterday. we

should current our policy. people an when at look be thinking we the it's that, have important aging strictest which you for to know aside As inventory adherence to position everybody that to about,

values And that the we rarely quickly so flat-footed. a we caught get if marketplace in so inventory our in there change is turn

we mean the kind does quarter, get we it, toilet much that That when we mistakes. That when not don't that's into cases of mean on reconditioning and aren't put fourth make there few usually where does a we too to the things. flush not

have is it. buy managing used investors and to pay for an you for want how It's much want can for years. that comfortable, to things. not as But very there very as way. It function doesn't strictly deployed that's we that as inventory to you acute be We into as science capital I just buy much their

Craig Kennison

you. That’s helpful. Thank

Operator

Please Next from question John Healy Research. Northcoast comes ahead. with go

John Healy

Okay.

Just there. on industry, wanted how and perspective sales love couple side. to to shop but the seeing you're would the coming process on what more Obviously, as love seeing become some financing ask kind of to of unit? you're just in to on the just consumers questions I you're these a a get financing for of for the it's they're understand cost would outperforming elongated

Marcus Lemonis

point a kind. has frankly no come change process process buy and very of is But company many the many, before to seen in. any very headwinds tight seen even to people we in with to any We've relatively But We it. very, there. this they stringent at prequalify credit when come in finance our haven't out they is willingness Well easy. lenders' quite our process lend

lenders experienced fraction type And went that it through. you of when $XXX,XXX. the credit small then look the consumer better of think score historically that's a I a credit auto business is was household an profile at in over auto It's primarily different back 'XX 'XX, what customer. It's typically delinquencies income RV average small, XXX the because buyer. a customer and even the

So one. that's number

I would thing particular partners is them we XX that exception robust. bank is that learned think over fewer customer, us they the overall or result. credit last and a having making And portfolio available years it yield to is going an we give when make to customers banking the our out us a better a very with the rounded second because on stretch do

relationship took us could finance there's that the one six opposed a type we As side a there's where used our sell recover of have have of can on on and be outperforming it to having because office on and of loan, service reasons customer side whatever whenever may why losses tight account experienced. finance It's us that or union, have they if new partners. to where with on credit a bank and we potentially it process the a relationships and they something to our or refine local process the the help XX in built us to may easier happens that and banks, and five to side us decade it that goes where sign much we're or can one that bad

John Healy

super That's helpful.

expecting was any I of in of supply color the of purchases to on as market on kind question sort we any I impacted maybe close going government kind in of RVs just guys. mean big view was Are State how of on on any a sort Another the the obviously you year for ask you Florida. what's market? wanted or out

Marcus Lemonis

reason the was by strong is in XX we're all the happened that devastated obviously, last particularly for It's our of stores South all days South terribly the -- what demand the Florida. it's Well visited demand is and I that I unfortunate strong. over Florida strong.

demand future. from the to entire continue that to regular company one basis. expect the have here in US our I mobilize is feed And on ability continue and inventory Southeast we advantage a as the to a think locations foreseeable those We

inventory, governmental acquisitions of activity. we're it FEMA not to As seeing much relates

up We at the showing normal through but about the in of are of in have with some consumer transacting just we But in with putting home on bids general process we're issued the process. Florida insurance this state some focused point, showing Florida. all up inside by the and who's cases, and no checks state a heard activity at

expecting sale And not we're any in everybody fourth let if that quarter. know. happens, the big obviously, we'll So, bulk

John Healy

Great. Thank so much. you,

Operator

Ryan with ahead. go JP comes Please question Morgan. Brinkman from Next

Ryan Brinkman

you in my taking what's ask new in the as the turn implication have you stock to RV about, new for where of Wanted and for you of gross questions. with think thinking, demand your latest terms for on for regard unit inventories be on of But side. the may balance lots? units overall and you industry aging on margin? do may supply focus been to sense the inventory? retail you've a the new And be terms I your and Thanks regarding where new know, ramp, Hi. RV disciplined dealer used competitors

Marcus Lemonis

forecast RV are ever dealers like don't other to I doing. what

other maybe this discipline a businesses. what level I realizes my was is That's XX protection discipline. think, have that forecasters do everybody -- believe. because seen we of a function the flag that's It that people's early business. in with But you being of of we dealers we're raised years I haven't displayed it inventory and was because margin that because not February, believe in of maybe to candid a manufacturers dangerous thing, I be other in

able have some are they're environment. There this to in don't it. going the not that strategy. to be going digital dealers, compete database be be have aren't They going don't to enjoy able They to to the and

four markets, industry certain so certain But a consolidate dealers it's undisciplined a other don't large ago. more the strategy. that today, that become exist exists pockets, existed the And years XX believe in about three, like four or own continues that there ago maybe that ago, far sophistication pricing may manufacturing their retailers years is on with didn't And five there's us, I ago. side, sophistication that in or as years possible, to XX years exists

do however, generate we capitalists when all I retailers incentivize transactions we way we're revenue, in easiest to do that create something. the And do heart. is want the or to know to that customer that to at believe,

headwinds five, That's will inventory. And the over so I move expect and months, the your that good as promotional exist. four, to fluctuate activity here business six margins just next

that everybody channel has business has history my always whole industry everybody is what But think in one these to had should small always recognize, remember, thing is little I has me, taught spotty this comes that, that, the the back. that cycles.

levels which dramatically SG&A of will it reducing period everybody a dramatically while dramatically happens do so short marketing and reducing and And happens, for reducing inventory time.

So, that very to activity, that. I shortly to up summarize, pick pick I expect normalize up. will some the expect headwinds more the more be while marketing, it there promotional after and to there headwinds be while

Ryan Brinkman

then, do consumer. you That's what great. latest the the think And encouraging. Thanks. Okay, is in terms of

consumables and at sundries you cetera to downside and XXX how retail likely et of or gas think think track that rates, XXXX, your there? driven used I that interest anecdotally is RVs do even service in such new through But store so participation course, Of collision course, miles like demand of units. and may data prices, the if trips and that unit like in out don't those threw really and whatnot sentiment forecast about asset for taken prices or you the for as lifestyle, exists. new one what But we impact have

Marcus Lemonis

Good look is me for which at XX we our more downside still XX because in lifestyle. shipment always the RVs we has why why up people And always There years is gone base, we which it where why is anybody already is than certain are the of not And years good, others. has that business which our our our gone business our years, reason special But Sam When let base on installed are is good, forecast good. for it's clarify believe focuses service XXX,XXX XX it for feel largely used is is company, that the own business model, the up. installed else's, comfortable that it very our years, in up. goes

have we the while new across done off an That's sometimes at earnings a people. XXX slight I as be you a CAGR period, to and to to we've when are move industry, the a $XXX,XXX is there What to years, market, flow the I the that, be from the a into can think phenomenal. pause to a and structure and out coming cost on years. with creates average which XXX,XXX and look lot of lot. million have in drop be as slight happens XXX,XXX and five-year capital over are returns accept pause. not a there's and cash believe company the there is, the they do of to of trough entrants going are What going growth to what able that, peak It's But average

I I manufacturers. the think applies business. our that for know for applies that

Ryan Brinkman

I'm the then et And cetera. And sorry, you clearly used et recall also, the with I locking RV heard SG&A to of But that, question. brokering, business of allocation is not Thanks. how the investment maybe acquisition renting with renting this last interested of which translate in because core you're to just selective business, But RV an profit capital of on it, say sharing the missed being that synergy I I initiative, Okay. does you focus if but core more the the were down cetera. or including in potential for the longer-term potential business, mode. RVs.

So is priority? investment sharing a in still RV

Marcus Lemonis

healthy it our that we down sure tax, keeping at get our we're in service been most doesn't Good and the Investment in a some yield our like at employees the capital asset they're is we to our because that Sam that revise important the available total point. us our But and anything paused idea, brass That doesn't that, we're point need that this super are in paused. company, look to amount company. return that and margin when not I and to will has going a safe at of mean making business used be our doesn't stable, abandoning super and mean

is sure pay market. have with benefits, in look We their make to the their at line

our sure are satisfied. make debts inventory solid that to and have lenders We our our is being

and want a opportunistic make We have basis, finite sure make make cash that. have being more regular to acquisitions. to dividend sure stockpiled our that I we enough that is make on it paid we've to than to

$X If $X pick to could open I buy any the million those the wide market $XX and million of land hold than would market turns whatever any up million that in rather space $X I wait kind, million spend. for earnings, a location revenue, period, we XX-month is going better in it and up were $X to when into return and for and million that capital initiative because maybe, given million invest that of on of the a RV share, any $X

Ryan Brinkman

it. Got color. Thanks for Okay. the all

Operator

D.A. comes Davidson. ahead. from Please Brandon question with go Next Rollé

Brandon Rollé

Thank you for taking my question.

First, just on mix. your

future? And year? This next moving balance. you tilts there to would you XX-XX XX in know is of a new used. like want forward a get maybe balance reach that were you to the I Do it closer used feel you quarter XX, in chance favor the to

Marcus Lemonis

to our market. We for focus more our to and double that used goal. business I to new is hold of our the new to really on would I'm want does because And use, that us America. grow the as retailer ranking till And want most destroy is but one goal. that new the business never me new die. maintain or It's is important a ever number the another to we it believe to use used forces day cannibalize continue our a on we XX-XX market it achieve RV business goal what to going to to would Getting in grow addressable we

size and last the new $XXX,XXX. The units of RVs of transactions shipped hands marketplace was used XXX-and-some-odd used The of out at traded was number year thousand.

used business. market have improve at at by benefit share but side, the the growing expense on used market business, We not our new market the of our to of our

the trying really by gotten to in side we've get business used from dialed continue and we [indiscernible] to we're not don't we've and up new business. new one to other. it's going that to I XX-XX think want mean that anybody the so away ever the lifting And suppressing XX-XX to that we to get If on the

Brandon Rollé

continue environment. How Great. like we're forward? maybe moving affordability the over Okay. goes months? to average where affordability feel higher And then And interest for vehicles new just rate on higher. a do in you it XX seems Obviously, about prices pricing trend next selling

Marcus Lemonis

very it So And the is we'll we categories to maintain space pricing. into dominance business did that there that to an that a that in is shift third increases those noticed the starting order pressure and capital because were give marketplace year feel we made because part we around in feel alternative. non-core reason into we would was put on exited But the RV consumer new we all in used we to took the consumer this of to continue the return. the started when give we we to the reason needed the why the outdoor of from strategic our quarter last and use

been. costs them or expenses asset new can on that's from interest like trying their their If rate unit buy a a a new their of manufacturers payment one have $X,XXX, unit own $X,XXX, can higher they're control $XXXX see But $X,XXX, you increase that incremental environment, to offset that doing hell would the filings that receiving are We $X,XXX, a pass two the you we by than less years not margins. selling at and to job trying vendors, believe us. to older a also in

so we're actually And not that to naive expanded. the margins fact their

As dealer an we RVs to the as in as the expect will point single largest continue largest get to because best uncontrolled industry, in same customer retailer new deal. America not we unregulated a the of pay the

We expect savings to pass our bottom-line. and those both on to our customer

Brandon Rollé

last And just one Great. question.

or inventory do right want about be, to they inventories you on And a over inventory? under vehicles feel little feel vehicle Thanks. greater new your like you used focus are where how your you're Given do now? you

Marcus Lemonis

of XXX, genius it's absolute I As it time units we candid the to I think, probably units who new about our So inventory we're it To architect you, been at XXX sitting location XXX. the XXX from want on ground. per has be what That's five year. strategy -- over is of with be right? was think, about and six down this from would Matt less or down mentioned,

the we challenge of units we new what this before and up. number have to where we location quarter, of today. pandemic, try But had we to preparing maybe inventory gap fourth season to going of for the per widen is in the are historically want the selling where so go And really tough between

be we we units smart X,XXX not approach? but No. are over love take even we be? inventoried where no a Are we'd by couple and them going just little. over and absolute a buy to maybe today Sure. we we of margin burn this are what So, what stock to from We'll, about reorder,

Brandon Rollé

Thank Great. you.

Operator

Please Tristan go BMO Capital Markets. Next Thomas-Martin question comes from ahead. with

Tristan Thomas-Martin

Good morning, everyone.

Just question. one

a getting have RV used lifestyle day. out another called who or else? used or bars something leads are behind, to you maybe these a I leaving think perhaps do any you Do data X,XXX a new you're are buying

Matthew Wagner

exactly our lifestyle, is you depending heading in to are I either assets, tell single looking oftentimes every you reenter year. what look the are they're to motivation ability Almost could when into next to discern always that maths, these the the season for customers at as upon impossible used But customer. source

us March, to So us for expense come conclude incur lifestyle buy such, us they doesn't cost that consumer just of reasonably storage. example, then they asset as that year. comes be August And we next the the with that to reentering if customer an September, and asset and in actually April a to from could same to or by want

into consumers, There's basis. to lifestyle because hopefully, on always a short the going the to a time choose be a just consistent some for exit reentrance lifestyle, we see lot of that

So attracted slightly most in oftentimes continue be they their are to RV childhood to their age of kids and out, going or style we to the reentered as see that the marketing being different.

Marcus Lemonis

go not volume them values at clarify in our and and this display. through all and we've or or have purchase tried house, steal our change Good dealers year, country come Historically, subset that and Not "steal" trade on is dealer put in that The it company, gyrations. this last people little used it our of point, pans stranger full RVs we the the having a just to XXX,XXX or volume to happened some classify fairness put the growing, to a lead that more. Sam level. their at and reason a process to as small and decided believe process that almost and the the transparency as are have to the growing of liking home want is the and I drive used very

to just is If fad, to and what that happened is easier what on rates marketing seeing was not hasn't monetize the It them on notion. are happening for gas is leaving will a encourage interest and for going This name was it's existed you existed it like. consumers them, an a already a think XX%. the I go we it that you a and go a based are it up And war, the to away. marketplace. when you false XX the that people model, goodsam.com unit RV and It these and make see that were years. always when shortage, today, industry, I do when people at way it's all made to existed process was the isn't to in there existed there idea a this

point. the for I grown manufacturers you very constantly grown a can some that innovating tow And important what are could market, car, the into this has electric that think has market. we is very point. buyer Forest at you younger, What their newer and the potentially with like tow And is River, a have an something dollars with intelligent car investing something lighter products Thor

So, what the allowed after year. year that historical innovation grow has is with buyer industry this traditional after year along to

Tristan Thomas-Martin

you then And can Got locations still sneak year. location? it. -- new also Can you or two expecting Thank last down? you. still to then used of are I has XX per to -- that target, the that And more. next gone XX I units if kind your what's quarter think said you Is the in

Marcus Lemonis

locations, by punctuate of the up And sure on want location, number to scheduled we we going a basis. of it per are I'm Matt's but opening where to to used be open are look from used he'll units stores. terms with in understocked still we location

kind have any have are visibility of not spend going some we're money going. them We until any into we to stores or of we where built, open

to But and in that transaction cash mode are we acquisition can up. are If opportunistic going mode. acquisitions we everything do pop-up, opportunistic to we contractually lock build

we some our are we month, have until we finished have are we unnecessary finishing and are If visibility leaves or dollar have that doesn't have when door construction which we locking so that do, bank we today, which to. account construction that stores no waiting do last it that

Matthew Wagner

on Tristan follow-up level same-store per basis right or used per excuse basis just -- year-over-year. a I'm flat that at that's store excuse actually on inventory about sitting per a now store, me store sorry and basically me we're same-store XX units to XXX on

Marcus Lemonis

enough. get some on the -- those we've of not margin location strategies just we the those to That We're in there's on and darn additional probably the some one stores. stand-alone open units no be per decide XX opening profile will investment It's used we of as will be when short pretty a that. stores It's return to stores modification. think XX decision good. made mix and We

Tristan Thomas-Martin

Thanks. Got it.

Operator

Monness, comes question Chartier ahead. Hardt. Jim Crespi, Next go from with Please

Jim Chartier

up Hi, taking question. question. just want good the morning. follow for I on Thanks to last my

in on you So, there inventory where back you it before you're to quarter you back third and like vehicles, second used be. want during starting sounds under quarter to build pulled

if what So, impact the used dealership that per to of sales any XQ did your to then in impact to time inventory third in more XX in get have? kind And pullback like what's quarter? XX you'd that line to the units

Matu Wagner

going it's did of that confirm the that difficult we I in up especially sales, QX. maintain but could early opportunity that we to opportunity be cost, part I some give actually quantify -- on definitely used to

bit results been what way My of throughout we acquire units more little into a have up the be of procure continue yield to entirety more the to just use. to as is and fast-forward to to past latter more momentum we by to months, year, sales transition we used we that that basically But over pick to part as the compared able QX, and next able think in been hope we started more and we've started XX the of October. I to some able used more sell. continue just

and into battle stores to up be expanding procure and So as this more constantly constantly more able these to too. here even more channels rebuild we're against we're

of is taking of understand beginning we to more So just in really this the used the pursue in ultimate name assets used market fulfilling us continuing this that share goal space. the of aggressively

Jim Chartier

time billion in Great. it then get to unit used revenue. like confident used revenue point? at line there you're What's or pretty And the still sounds the this $X

Marcus Lemonis

giving line, substantial fact back would we a I guidance. because us some confidence Rather million know be today a The of which than I than we momentum time in achieving were that higher you sort on TTM that wants giving everybody have we then that. gives are $XXX

you on Matt say we a ask he'd couple weren't of public a call, If probably and years.

realistic there. in be just five The that great, will business we're think be some months. got looking but to We're I an environment that little tailwind still the has for not to get a to in six we the next momentum. uncertainty used it's

clarity from months we'll eight of be provide better to that probably think And able so six to now. I

Jim Chartier

Thank Great. you.

Operator

no further are questions time. over There to the Marcus like at this for back I comments. would turn Lemonis closing floor to

Marcus Lemonis

much back, head is don't And years last of in front I our in fast. long comes as this for XX last. us. And they to come being as in to headwinds needs so back you headwinds people want comes our that of think They when they're it making pretty business SG&A company the that to to happen. going back, market when joining committed reconfirm just whatever are Thank count it deal changes us. make with our our overall whatever to to to

next here holiday. great quarter reporting forward Have look we So a our to February. in

Operator

concludes This today's teleconference.

your lines Thank your Have You may great time. disconnect this for participation. you day. at a

Camping World (CWH) 2 Nov 222022 Q3 Earnings call transcript