Camping World (CWH) 29 Oct 242024 Q3 Earnings call transcript

Company Profile

Participants

Lindsey Christen	executive
Marcus Lemonis	executive
Matt Wagner	executive
Thomas Kirn	executive
Joseph Altobello	analyst
Michael Swartz	analyst
James Hardiman	analyst
Noah Zatzkin	analyst
Scott Stember	analyst
John Healy	analyst
Tristan Thomas-Martin	analyst
Brandon Rollé	analyst
Bret Jordan	analyst
Alice Wycklendt	analyst

Call transcript

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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 2024. [Operator Instructions] 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.

Joining on the call today are Marcus Lemonis, Chairman and Chief Executive Officer; Matthew Wagner, President; Tom Kirn, Chief Financial Officer; Lindsey Christen, Chief Administrative and Legal Officer; and Brett Andress, Senior Vice President, Investor Relations. I will turn the call over to Ms. Christen to get us started.

Lindsey Christen

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

Marcus Lemonis

our morning while highlights XXXX quarter team On to of quarter financial XXXX. and cover comments call, Good and will welcome on providing Thanks, operational Lindsey. our third today's the call. the

to his like would as team welcome first CFO. our Kirn call started, Tom get we Before official earnings to

our outperformance in parts has I end of am continued industry improvements and the proud business. strength Good market share, World accomplished; our team Sam As business, in service RV Camping year-over-year headwinds progress our bucking immensely we and near that of record XXXX, the financial and

is maker. company that X drivers: the squarely ability market we distribution, foundational our accelerated our As product growth of for believe XXXX, a and rooted we prepare in be to

Dealership organization. the In May part The of have the grown the at path dealership to end with is acquired clear are locations and DNA a distribution. now of XXX first quarter acquisitions to of we first over XXX. our XXXX, of this

As we precipice I I sit one today, I've opportunistic on the believe the M&A here most of are seen. of environments

used growth that Camping will We physical digital through locations, World combination and and our platform. exclusive distribution World manufacturer traditional Camping stand-alone execute dealership consignment of a stand-alone used locations, locations supercenters, auction

Secondly is product.

empirical of are the XX% manufactured sales them Thor with sale Camping between River. Over RVs innovative and from Forest both this unlevel data, find size to our plans is modernized value continue enhancing yield to to weight, and plan unit market customer. towing new It our scale content field the for that for World partner are partners. contract around the use and ways with path creation gains. our unit letting our Today, floor down Just new of true consumers the we comes yielding ago, with and OEM our while manufactured design shy sourcing, playing company and started decade solutions of looking manufacturers idea through that of on to exclusive a to creative and further leading trends features

of World. Camping being product the a cornerstone the market value Lastly, for is creation the maker to is path consumer influence as is to and distribution industry key acquisition,

market identifying and and white demand, real-time used to well product market-based invested the segment. customized initiate find data by as our Over increase has data. This space modernize last RV and and industry. over white CW the improve ordering, used via values, side nothing with recently company business, years, Good When our is accumulating Valuator marker and geographically the auction conversion as units launched party than being proprietary metrics, pricing used authority of see the or space, others used inventory generation, XXX,XXX lead on create Sam launch is vehicle Between particularly dissecting dealers around new we efficient product tool the transactions. both XX highly sold both value supplanting clear informally as national design, in private the more tremendous the

us in to growth the RV the identification macroeconomic together, headwinds XX,XXX environments market, These essentially in we and all units. additional to through combined by of investors. of and XX% consumer shifting used or markets. This of at catalyst preferences We of the in ours. favor exceeding mitigating market and of those capitalization in manner or XX% are the a us a the buying are nimble market the a of those Do macroeconomic Taken certain math to record new liquidity nearly opportunity inventory X an would new sit constantly of creating address the markets. share selling require or used drivers of underserved of or share sell creating pockets me, RV currently enables incremental combined X% RV goal share with our

we XX% Now know our inclusive addition of market M&A north delivered to to expect, gross cash-on-cash our XXXX in has sources goals. share to are annualized dealership required achieve profit. XXXX, all of of organic we acquisitions From growth which returns

to industry single macro trends an we call and clear path towards that despite acquisitions, of have share we yield on deploy a turn volume we macro without relying believe about additional looking would XXXX we're on average rate believe every units headwinds, for. in to history, additional X% based Much over locations XXXX improved profitability for like and would any materially. I'll XX on we Matthew. dealership gained averages. based XX That's example, improving and market the how equate now the interest the million those that dealership to an that in XX,XXX we approximately metric bucked As the on $XXX significant locations

Matt Wagner

Thanks, Marcus.

as up broader of into double result with XX% the We the fourth new on those enter months. we solidly our results continued the in We industry. marketplace. we July fulfill to in localized procure RV in the the significantly Throughout the accelerating in in October even achieved same-store thoughtfully a material outpace needs. and direct basis assets months as gains share digits, nearly segments ahead. new continued to the robust to quarter gained sales specific dealership increase throughout and confidence more began month-to-date used a As mentioned, strong also September sales market quarter, of stacked we of our These August both to comps stabilization in began used

is winter. RV we on with to the replenishment flat fall process. of our used This nearly year, of inventory used calculated to have of we the As lines. In appetite last year. sales broader today, is into improved the we amount margins We earlier conveyed multiple here we sit and acquisitions. pragmatic compared and positively LOIs dealership anticipate our inventory have and of our improved for have we October units been view used messaging trend XXXX. in be growing while opportunities accelerate health our increased compared as the capital our evolving yielding of M&A Informing will same-store that same our units industry pipeline our that this October, Consistent used currently have with patient

the our broader XXXX, place the industry, the for progress economy upon in to business, next factors what new all in we of broader ways. the following matter, as share. We used dominance industry within improve As or to service recovery we Sam, growth takes excess defined tremendous anticipate unit market and our on our of double-digit in control unit judiciously across we year the RV next towards see in drive made We the variety a path focused re-establishing year. expanding while remain of low we strong maker Independent our Good that maintaining market have used year-over-year. volumes a see

on within unit to improve SG&A expect selling basis early as sales to will call based discuss profit our We our year the of vehicle indications turn basis finally, bring to gross roughly now range. average dollars margins increase the as new results. by believe year-over-year Tom historical into inventory of points modest model gross strategy. I'll over points a we system. modestly XXXX a And year-over-year our XXX We the of financial gross increase to prices XXX with percentage used expect we back profit

Thomas Kirn

Matt. Thanks,

financials. to Turning the

driven For we recorded quarter, by offset sales the a year of unit increase new third unit in primarily XX% revenue in XX% last used $X.X decline roughly flat sales. an with billion, by

segments sold plus and segments inventory ASP we primarily into XXX over XXX the heading benefit further plan as quarter continue into deemphasize in bolstering quarter. accelerated margin as vehicle and XX.X% We New of just units performance gas slightly we GPU vehicle A driven in the Class sales of accelerated, with pace. the in compared our back by system new these XXXX. on margins over Used more actions were year bring to of for gross had a Class diesel but to fresh prudent last used at line Cs. to XX.X% continue strong we reported the These was

primarily our of to show furniture impacted by Services while and benefit due sales service in by range growth comparison the we a the business margin during line the quarter. gross another goal solid million saw core and the remains arrangement services growth of Our within top be to our our historical exit Within product, continued time fourth year's quarter product other; back quarter. third dealer exit declined was sale last Sam to revenues the Plans quarter. Good while $X.X second profit

with inventory procurement variance of adjusted around million actions EBITDA was from stemming Our year-over-year the the the deliberate earlier our driver used $XX.X in primary again year.

sheet, $XXX cash cash, with plan of balance approximately account. million about we ended offset the floor million in quarter of On the $XXX the including

million $XXX $XXX of of We of parts have and inventory roughly million inventory. also used net about flooring

million final we to without the of over estate Marcus associated back turn own for about call Finally, $XXX mortgage. I'll an real thoughts.

Marcus Lemonis

important It's team's be like XXXX our much current for share, market Q&A. now outperformance belief better competitors, our conviction Tom. that and significant control. I'd we see to the in from up space year our of growth the our white call open clear stems will that within a to our Thanks, be our

Operator

First is Raymond Altobello question from [Operator Instructions] Joe with James.

Joseph Altobello

further I that growth that assume essentially market first for about is outlook and modest acquisitions? or So wanted assume outlook ask your unit gains it your to share year. next does question, any any new Does

Marcus Lemonis

going of is than better goal for believe our to continue that. that did expect we share. market Well, to increases new gain on the It the and and have it modest industry broader in that to away we perform XXXX is market chip we top

Matt Wagner

of if even same-store just at additional basis. market could to regard Joe, I a share mean judging add of oftentimes ourselves in when elements looking I we our other terms couple we're just that. gains,

of acquisitive So business. highly we're the you a course when think outlook, of

thereafter. share market So continue naturally acquisitions, means by acquire of we to

to where I clear sure in possible. purest the So make that's judge want form abundantly ourselves we

Joseph Altobello

Got over it. do on How used from? coming where that is it? trending see and procuring the Okay. next inventory are And you quarters how inventory, you guys that few

Matt Wagner

So Joe, inventory mentioned there that time as used terms remarks, marketplace our will instability we this feel was line of have with marketplace We been on clear how a the of super judicious we've that knowing return of in last now in the been quite of yield confidence bit entirety in procuring we in overall a the this sight year of investment. used year. we've greater prepared what

heading leeway through And and would. up then season should a X- that So we X.X be where our turn where to we'd to we'll thereafter, we'll just follow ourselves about largely procurement. will on some procurement used like we a trend continue supply or seasonal we to sell into about start as providing normally ramp used, cadence which have a in just target of case normal X-month

So could market our outlook where here. used that and cadence gains actually of receive retain used believe share pretty is we such and on our we material

Marcus Lemonis

to year. yourself margin build exit us we're to expecting to you We're it's Joe, for double-digit others that throughout huge as the in ground up in too, time into second to and the as get in the gap to I going expecting experienced that acceptable return low of range earnings to to year But importantly, going from levels get growth model this and the and margin and the to then XX% we that's a of quarter we of hoping more of are to think out fluctuate of terms back mid-double-digit that XXXX we That's a lot power. that gross we're type and have XX% XX.X% category. to the make first enjoyed.

Operator

question next Truist. Michael The with from is Swartz

Michael Swartz

were in think were and Maybe just flat in about efforts the I quarters, some the motorized the the just commentary Then in on primary new I margins year-over-year prior a the that pressured Is to should fourth X to in start your RV that guess of they in we quarter, heard factor year-over-year. quarter on stuff. little new they down I why how the were well? think the some margins move quarter? about as

Marcus Lemonis

is Well, the in any way we by margins that break segment. it category we analyze down

on and actually aggressively gain RV performance actually that a in than our do overall of core Clearly fifth part as we with higher had a the lost in that trailers the the and motorized wanted comes That's didn't wheels comes lower we margins leader our business. with So in it and to ourself clear margin. to business in price market believe re-establish some we was footing Class we that. start C solid. market But other travel share anything our of point

quarter you of factor sales incremental comes something a that's more it higher a year and to much a lot XXX when compared revenue the at lower unit and for price margin. XXX with a with So lot units ago, a in little

the too margin and gross frankly deliver performance, percentage into very of that. top particularly gas felt We A those While some quite dollars good maybe that going some we'd and on our destock of matter or like of matters, XXX in about so margin exiting light margin deemphasize to diesels new some 'XX. gross our the actually Class units

Matt Wagner

been right XXXX good averages especially established margin pre-COVID we the profile through have I with norms in in even where line XXXX. those context feel about that that really are given of

largest reaffirm margins position as actually opportunity want our So now sell we'll QX same to normalized entering more probably anticipate a reassert we quite roughly QX environment, through too. the that have ended Michael, that we're will constantly given especially dealer we motorized. as more motorized And be the a profile to I'd the where where few and our

Michael Swartz

Southeast to from term, demand think of maybe late of on we exposure about in that lot on replacement Then mean helpful. to your way I I and you demand, know That's near then Okay. disruption came October, impact that September, early any and storms -- X any the any just to as on a have guys retail obviously thoughts had term the potential locations that maybe longer through. well?

Marcus Lemonis

sales where obviously well. on locations to negatively we where on be XX in in my affected when We're back-to-back between ever it particular are XXX quite surprised days October. think performance new you missed which pretty at did But used stores big first to many how had within was in and but robust XX by to so the our same-store had time would the so storm out want I candid, a years the of same we deal it, new and we was the month closed. XX I it; units. in do don't But region. There anywhere just our probably XXX calculus have raised a October. team the make far

devastation saw and of ago that unbelievable sell don't Myers see people's a in. did peril. homes. people we quite saw creating and terms that demand, demand demand, not coming other years we candidly In saw of outages we're X power happened widespread because haven't need lot that top of where happy We of unlike But we to Fort additional seen on we people's we

Operator

from Jamie is question next Citi. The Hardiman with

James Hardiman

conversely, XXXX of industry it us industry are I'm through independent, the pretty downside you've does way could within macro year? reason, to right? look perspective would like making? that anticipate seems think what way like some any that guideposts you X, there of you if prevent assuming given but thinking really So progress need industry of the the a the that the about potential that's from next Is sort for independent, sort And to help you're upside to

Marcus Lemonis

Well, for for the and the industry forecasting industry it. an really internally idiosyncratic of we ways slight driving a really like just health We're a feel knowledge unit the XXX,XXX both data retail business will be to lot of uptick running and and XXX,XXX we're range, own probably the that us. in lot a in for our is

of X has And there payment of the of partially XX is sensitive to talked past, really determining drive we've interest months to overall health of buyers is units. our the health knowledge how are inputs the are industry of rates the understand to that and and as in the about really last what the in consumer. price One helped us XX the the factors in the

rates them tremendous people. XX-year ASPs to year, we the providing saw whittle and of [ XXXX, our we ] through conservative saw own rate as retail forecasting can financial of down One our we of to we advance in a we job really approach in for around our the modification. that still are in value cut statement, control did own only But while In finance very reductions model any start good forecasting point driving a XXXX. in in taking Fed we're X.XX

that Now that's have told far too negative. us many

to the resistant outcome to you we response Matt, want anything know possible But other if, to Our that build be. model that that that? than that, is to need I to is what could business add don't

Matt Wagner

put out segment. so feel really given in We risk the the we averse confident the with are fact there what atmosphere that in very we've used

we focus very see at target time of our while maintaining side, on And the replenish to into all there what same a this today, So your the James, thrown to model of what see business it's had we throughout year. as a we you're lot upside stocking used we've on to of our starting just back levels concept just just XXXX. we really that recovery there built clear plug just and even the out going a new

Marcus Lemonis

the we there both drive pleased is it shape. that are more still disciplines, I Thor look ago. we a landscape process by is right strategy RV Unfortunately, the the bit of tell be a much a chunk and year is inventory. not for dealers, discipline large I dealers little think vulnerable other through to compliment good helping that like as They subset the have last may than one market in and it a Forest looks inventory at River of thing, that James, overproducing was healthier you of

which have this doing well, cash-on-cash company we be as on we so a XX%-plus on returns a to opportunistic basis that And basis. into are long-term head very making XXXX, what does acquisitions excited about is

We up working. LOIs used unit way growing a we number standpoint, volume of grow volume and room have know and first, units We're as that individual believe have market room new and a unit think that selling to the mid-cycle, each we store to is, and that about that the improve is towards growing a are stand-alone with basis And share will will from we same-store to that organically. We and on on pleased ratchet not great. that basis. start we a be number of drive the

a On opportunities. ton the see side, of growth we

look with one did would expect for we really to that fact better. as because value things did that really think in traditional at the looked much us head believe We're of the on. we list of get now have opportunities only deals opportunities more those other of a a reengage we we'll that number like past. and that XXXX, We starting end has into and back folks I pulled is benefited In we of 'XX, well that at the paused we

James Hardiman

And think so to last follow-ups, point. stick of a let that I that me number there's but

better, the to this at be opposite. but is as saying feels certainly it that think XXXX might like update importantly, the Maybe in it net seem third in path an XXX. dealers you're then in XXXX underperforming had industry store looks what -- more that just end decline maybe us and does count seems interested less dealerships a quarter. like How suggest about to on You it would getting the to help selling point, like your the and exact

maybe So progress thoughts M&A trajectory? updated on the and

Marcus Lemonis

capital with not have and Tom if yielding And a we've authorship. to very estate. We time that of deployed I time XX the existing perform. Well, out. very, approach the years, don't our in over we have ways and ever in Matt, that pride location those us part real and working is operations inventory something, that of locations of unfortunately and how dispose disciplined And Lindsey, done course the

-- I'd and Matt As here. we like weigh look at to in opportunities

want opportunities, is. out look space As at the to we where we find white really

And and white have so looking the market share space at that Matt Lindsey exists. reports in instrumental where been and

Matt Wagner

obviously Marcus stores, traditional of stores. gains our said also James, the stores And used as having elaborated perhaps targets used-only multifaceted well and but Camping our stores, new clear-cut on Gap] exclusive share our we remarks, in combined. growth [Audio we our terms only in World also market prepared consignment approach to as not have

the of up opened possibilities furthermore opened of breadth marketplaces targets. local this these up acquisition within the So breadth and all

head So least back target, previously, beyond into XX. as this present be we this XX as we've said stores there's every to opportunities we're to XX to year. years, going in will of to more cadence into year, certain XX that And we like at feel that being able

Marcus Lemonis

I'd kind It's do. I optimistic forth little than that think something and of like can but more probably be back we go to mediates, a we Lindsey and with Matt.

Lindsey Christen

years, surpassed of done upwards year. we've said saw XX XX and in we past we've last stores XX we've think that to I historically like stores

the growth present So excited the get we're that can different ways the into we opportunities about channel. and

James Hardiman

mouth, to be put but those sort on going XXXX you're to it years. XX a of it point that to just types one finer sounds don't better words XX your of And saying I put in want than like to and is of

Marcus Lemonis

to value and capital. the have to don't market as that deploying business, we materially they cannibalize are As us put long what we feel front in accretive they are comfortable share, our our of add transactions that

Operator

KeyBanc from is Capital question Markets. next Zatzkin, The Noah

Noah Zatzkin

selling this on think qualitative you year-over-year? of And Maybe expect how that your of you your and your question. how season, kind on time modest of to on positioned that this plans then positioning new side a the what's kind confidence we should kind drive improvement to of like able of kind of inventory kind But gives approach your business growth? ahead last inventory when has side, be margin adjusted is margin new? more about new the was of you'll year positioning And the

Matt Wagner

here year No. I like today with where our of gains, done back managing year is to reflect model this nearly right as job due towards half year affordability compared curves of last to management, 'XX base. bend -- And mix certain to the inventory those we're inventory of the the entirety feel as in very exact we've year 'XX heading such, playing XXXX We to upon share our year. segments new a to as for year quarter playing market the in effective consumer actually same as at into as over model now of 'XX we model to sit 'XX our

type As we environment have to we prepare same will for manufacturers next year. further last be subjecting deflationary that us the experienced year, we not that confidence

last about with our year stability, we time to have such year this did extent model the As pricing XXXX worry our XXXX we model that don't year. to same

Marcus Lemonis

do gain we thing very do whether and up, trailer. lose think Every are share, that segment where get has to market $XX,XXX share. but see deficiencies out where that is we're travel role $XX,XXX the single a in us have identify happy done our pointing market Tom same-store Matt in getting analyzed that has I he's was we of we to job I is that excited nice this because and helped -- one well done Tom sales

where that there's I to is partner 'XX look think of think it the us holistically. et floor for the top inventory increase code, cetera. year after And way growth. a all shown give We in year finance which a I 'XX, people with on of in having the at team modest price plan, confidence has a lot down go us team point, really opportunity stacked type of segment,

Operator

is The Scott with next ROTH. question from Stember

Scott Stember

they you you more the about seeing a than talk how competitive that's your Marcus, bit briefly more what you're about having marketplace aged of touched dealers the inventory environment in business? little on Could granular seemingly some competitive need. affecting talking and

Marcus Lemonis

that's after allocate segment category. how or market top to either is quarter between approaches performers or the dealers quarter and That Yes. month could understand I the facts marketplace to who adjusted. same with look I And and anything softer. disciplined general some pressure on market anything are to maybe who in the a and needed rely seasonally month, the inventory, sorts. a is, pricing demand, minute-by-minute to our of a be have there's When going have we to at at some lie. when noticed didn't but on thinking continued on that inventory there's margin have don't that think dealers segments any after contract. Think But affected, that motorhome don't you overall have-nots happening join dealers concerned putting in the conviction. we understanding to that look continues dollars ASPs study are drop; when contracting subset that about the Tom the starts it's necessarily where diesel We're other about there of basis dealers little we're that about the how

move and market, who segments C a what's from accumulate struggling inventory the in down look and anything Class channel motorhome every gas delta be the B the to approach out categories. ASP there you RV continue dealer gives of information, still the that as stocking it we not segment. that that away than and and pause is the the or inventory troubled I those entry-level into the and traditional the which maybe with that much us the look fifth in business; by think in core don't performance as single motorized But we study competes between at relates and ton at their that when may of there's other We us. directly to and see travel entry-level wheel is diesel the that trailer our Class business, difference segment, really Class we're A entry-level understanding

Scott Stember

how much Fed, how you guys that and traditional it's Got your versus it. X% whether floor a debt? the us by benefits can And for you remind plan move

Thomas Kirn

It $XX throughout throughout up rate little plan a could balance plan floor million on It a bit year obviously. our depends fluctuates year and be the floor the to does it adjust seasonally. that because

$XX about So million.

Marcus Lemonis

standpoint, floor our dollars in standpoint a And that confidence. from payment been a the rate rate But from unit the net because lining and ASP when consumer to silver is per senior on reduction could EBITDA the at standpoint to any up customers price a any a from look percentages, business think a to and in a sensitive secondarily, in per slightly. standpoint. in go rate ASP increase lining plan not gross incremental profit And is are cut flow basis I credit XX silver months. inputs, $X,XXX our from rate XX a is profit benefit is facility I standpoint, in cash the cut an gross allow X are we from a rate the super missing think have in that a unit even income raw and improved cut for we and last

XX,XXX to year, in between $X,XXX remains if As When ASP up. and XX.X% margin call add to XX,XXX just profit. constant XX.X%, is that the $XXX that selling $XXX in in ASP a new comes percentage still gross and you're it increase back starts even let's units that to

cost our that's else but pay go business out that is commission, more no think remains a little there when most our those scale to the is the running everything on of important where cost incremental we the up. I we get side takeaway from and Yes, business. fixed constant GPUs

Scott Stember

quick and last side. one the one just parts And service it. Got on

in that was I that? Could how that's it side, much I service and think was the quarter. up pay customer anything the you driving up quantify guys guess you pure said

Matt Wagner

it I in don't report work Sure. really come addition and units We that pay on get with sure I ready how has the team good in say percentage in on was inventory process manufacturers the frontline that customer-facing managing and to to managing working new we're performed and ready. warranty up making would that's but and basis it the our way, where quarter. We mean was felt single-digit about customer year-over-year the a

Marcus Lemonis

the amnesia. job is find maybe little get process all saw in good finance benefit, we to slowdown, always at that bit of team happiness gaps some to our did we they the when it space think tackling white we sometimes and in of a One huge if that's we really there I out good of any And better that a opportunity. I the of and from where things really is and the and get try Matt a in benefit blocking refine any pointing times, of

demonstrates level to want continue nice lifestyle. business collision the base customers the perform the end of of But that. of day, we and service at we product see our a the service expand because base at usage in Our to the to enjoyment continues in our customers and

our is often. overall look spot need we on thing we see definitely we piece, an when our do at So that or improvement to Tuesday is one for more us customers opportunity a sell sore for that

buy in X.X who years. early not strategies between customers X.X the some our know and trade We're third pleased and that rolling developing year us customers from that them ownership. their second, 'XX. and retention out of has improvement room recognized in of we'll for We have be fourth We and

is in to the our do with in not pleased are that the else We retain at consistent rate people everything how those company. we ability

Operator

Healy Research. is question next Northcoast John with from The

John Healy

a to of I picture strategy big ask kind wanted question.

those those kind in what share where I feel on focus the private us the get on there's advantage. market going XXXX, you feel on just again penetration. you augment wanted hoping kind was to and Because and the historically. could market and distinguish count your how just gains? use you guys early think private Was this store you're of how like of the business to forward label I in from stats label I an But thoughts you grow. gave here? to for going on But us planning differentiated is some of they using kind like guys curious give lot have are a label label private and really I and were maybe call, that you on private of yourself

Marcus Lemonis

Yes.

label I this that's I But feature. in changing today, back small person graphic ago and little model only looking or a I inside of manufacturer, and company. they when changing then bit make think was at label it's XX an private private had inside already to here of room a of going the idea this joke our years a a meant a

metrics to to and business then our with when understanding want plan show not of We no could the be people Wagner manufacturers really we up way I data have introduction size, unbelievable to even Matt it how that manufacturing. call right want his want done intensity you our of they if really between the parts step and point anything Matt we floor we're longer and label. key XX of think we the ordering back right scale, add particularly inventory, the And soft has at our resource. product around do some that expertise to private in feed at that? spots years to relationship the And Matt, using price to evolved suppliers ago into on that contract partner our product the decontenting relationship call it study it reason our that as you it going we manufacturers, those at that with market into the time a do know manufacturers is business what perspective. deep dive with business, that our to and look and to We good take use a them. and those that the bring right the the because at have down with all to develop contenting the an

Matt Wagner

of satisfy one demand no that Coleman some in I selling while team situations idea. us in floor even need to plan partners to the that decades of over price better what first think existed plan been our goodness, information. information us came concept of of cetera. in industry, that time, like et Well, content features It a XXXX we what this relatively or glance, too to off to #X the as clarify, that at years required. What and that until out the used far floor to he's OEM actual have about put terms consumers inform okay, target these where or was need in utilitarian First, find understand to gather years I the floor marketplace features, was floor that Lantern concept hadn't we it that the evolution think we much over overall about is how really to point put in of was decade to X And to want When marketplace has and a all understand of Marcus that we a research manufacturing well to research now at also the bring all an plus credit, assembled go as solutions was but manufacturing the on partner XXB, looks as insights was providing something plans, certain satisfying. solutions, to those we plan, the kind. this stranglehold and to say us Marcus' we it a we right and units. right to a being had When brands

we've different much only that company is different be private that based segments' so last Bauer number OEM the to these of So by to we traditionally satisfy brands. couple confined but upon are manufacturing to to marketplaces to people brands, very we into by like the product different introducing licensed categories, us capability enter understood is which to different price ability XX Eddie Coleman as sublicense years, means where question we're able partners points. And not by us been your many the have over up insightful their that expanding would years, a actually different label or certain in Eddie for all Bauer of product the manufactured a of way, as a John, we as

of within I certain full contract our is States. Texas. having are OEM brands Dallas, manufactured brands, what United by enter that marketplace and that private able the mean franchised of So to offering By label there into means we're of a any are within all

Marcus Lemonis

manufacturers more capable being to at that plans because different they to different have more want That that. is product I have we earlier go follow product a we to anything. you that in we're overall, we when established it, entire in going that think going go is mean and then us everybody are else that offering competitors see reason relationship don't distribution call as right don't other us looking doesn't in I have way for cheaper. deliver and capacity, going most product floor than we people to our compound realize as product. that believe means and welcome a and key look important going at distribution And when the want do we that a ramp we And we superior And Many which to its down to to always you we're us up. driving we so want challenged very our see a stratify and business, at that. innovative, competition have own think advantage against TAM dedicated an that top on left, we retailer. because for tow and ASP that matters of development focusing growing a the scale our take in our to share look into we department company if that own what way find that robustly always can that isn't hands the people and our that we to why with talked widening widen market industry have the TAM, use the But our on of they accomplished is is and team think and to competitive

Operator

The next BMO Capital Markets. question from Thomas-Martin, is Tristan

Tristan Thomas-Martin

quickly want to just question historical about on I RV John's up follow new margins.

margins we but RV XQ should I year? how compared of think cadence new think you XQ, to next the flattish then said about

Marcus Lemonis

and goal times different times recent fluxes that XX.X% year. in historical Our during and more of to the is XX%

as to we imagine better. note; is trying would when very a bit the robust. reason a there while summer, and because to here a believe motorized robust still excess we're make accelerated the towards tend a very little pleased drive In to our isn't you coming XX.X% to guy middle mid-cycle They deal. is cold that thing to As more get one our We quarter sounds some, outside a not of get And so that environment, take future, robust the which more we is it's But sitting QX important the is it's near everywhere. commission, in the that in shorter we're in he's market. going fourth inventory obvious in margins a with business.

strongly XX% we XXXX, range. to And anybody we look anchor at as would that encourage model so in building a

Tristan Thomas-Martin

Okay. next everyone's previously out that going left rate cuts, up if a we're reemphasis maybe this just even then mix mentioned year looking right. in and Class just planning maybe further we get the of going Cs some when kind Is a quickly you just for to And X? on improves, going or shift -- we're affordability

Marcus Lemonis

don't chase to think we I the want upmarket.

I has think to segment single independently. we want to that every acknowledge viewed be

one travel space trailers those. market the the of diesel; the fifth its do ask try And find way to wheels, we so to white study of inside Bs, what we own, A C is and Classes, would and we in gas Class each

more. we relates a going know space a leave we're decade point job That's this to that driving That too great side, same would do unit $X,XXX just better maybe a long return That $X,XXX. investment become C know ago and Class we the it at have not to to other value diesels, on the ago, of a real. to where have point us. long to on folks. for payment. that As time, a down payments white But Class sounds $XXX I is or C a today was monthly Not like we

and to we the want drive this importantly, a us by say buy high a features when more distinct customers from have a and over I'll very price. high inflation way that of the hard in to to down want to benefits be buy at of But decade our decontenting. We again, great we So and market. last with manufacturers we us see get to value they ahead lot our that there and have number don't allows work to

Matt Wagner

brands like about I Class and manufactured fulfilling certain We even contract and is no our segments, where been the and off we've working play C points identifying segment question just marketplace mark could over that if relate goodness, to X piggyback back that one and we our into from missed come exclusive floor products. months, X, our this of satisfying. Tristan, earlier in a certain where was the there's that diligently felt the John's plans last price subset

the next material into year, head we segment C it as pick and anticipate start would start gains up Class more I shelves especially. in So will replenish to to the

Operator

The next question D.A. is Davidson. from Brandon Rolle with

Brandon Rollé

margins had SG&A for Just touch briefly you the expectations? you fourth your would quarter, kind flat. percentage adjusted expectations as mentioned gross any maybe and stay on EBITDA Could of on a of profit

Marcus Lemonis

in Well, don't provide guidance quarter. we any

obviously start to just to But improve. are that. to with we want continue looking I So

like percentage as out mid-XX%s. quarter of a is the As a mean in SG&A the there. That's think where about a it's gross, December rough I fourth in It's the always quarter. tough we quarter

we we're for to risk. used XXX know we're that into growth think improvement year finish and focused higher way mitigate we're for going evaporation probably elected As and this think But being inflict XXXX, to what around XXX those used reason to we and looking to going really we're comfortable ourselves is based we which we the on where head the XX% year reason points of finish than on, of points we volume we're to this at. on the principally is that

standard. to businesses and goal stores range. that and we of the a environment, management and some normalize As XX% into XX%s. to to low of didn't down come expecting the eliminated a you of that away that the tell margins that normal we in that rid we're gold got will XX% we money, a back the that midcycle I take we in team start that comes make is That as have being

us. for XX%, not it's happy we're enough while XX% that isn't good So

Operator

Jefferies. is Jordan Bret The next question from with

Bret Jordan

all? you're not that of And to the margin Is allocation a times You market the you market. units, I the at to used a be used impact, them put remarks being to strategy expand the talked provide of sort in of category. wholesale about a margin you're in prepared going in going if that going the capital market-making guess change something couple probably market into back liquidity resell, and as either or changing that buying strategy? that's Is maker

Matt Wagner

of we've the grow the step we last your a I overall to resell And wholesalers available we've year. to take established used over side in had Well, That into played strategy. and largely actually question, profile. as and the market that that profit us different It our gross really top. the in our gross buy consumers seen a open and of that that aversion do to well just see and could see success there's marketplace. would manufacturing. in profile intervene our this about through to next at then risk I network. addressable the our in just maintain an happens able auction decline back us to been used goes overall stab just within maker get market and I we opportunity to market so even an perhaps Marcus' for the this push don't to year the that to terms from And in our margin also on marketplace, that if I ways think within I market start, actually deviation comments really I being contract

mean turn units, we're and In to pick up our auctions, wholesalers. recently we auction a number through upon different could reflect them to around buy to anecdotes other of and other where go arbitrage able fact most I the resell

only So there's that What's neighbors and of just marketplace out in units could exists is that of about X% and security dealer title exists financing as the amount not specialized to opportunities sort sold another to is consumer comfort transfer of in or that provide the with well or into consumer this of Craigslist. where we're the make affordable Marketplace going are only from We of connects that neighbor there and lost information, Facebook there safety whole to just X% any it a but more ourselves feel used marketplace. consumers. entirety that payoff the insert out in robust environment, like be we other to that dealing and with these overall marketplace

Marcus Lemonis

think that There I a position are substantiate X proof being around market maker. our

first only other using a Sam we and insurance customers and When pricing that data, The out. that variety and wholesale part units but whether of the encompasses to creating at X.X send at you the to value, sometimes buy to used cycle that's of buy it get and turns that that we and look or to we us. our everything rate, to in it, of a it companies that it bringing retail buy better factors current that a and Valuator quite banks units invoice give and Good historical new dealers is consumers And its dealers of on are point are not other frankly, often we other find use proof worth. tool, what

XX% buying proof points second mind the that of then we auctions dealers Matt other is were a percentage around when a that our and points XX our the that And to market X week more The and or see particular selling geographic example that achievement maker. running unit. is week same and of NADA XX% high through through same went to our our book. something same units mentioning later is in is The X or XX% this banks area auctions. position, auction being we point banks at definition the drive unit so-called of what in auction is of validate bringing later When X a was

Bret Jordan

Okay.

we'd this strategically the the will it something generally more be going volumes shifting So I of or we're just doing now? wholesale is talking expect increase that mean up? is about been something is that it this something have is sort the to -- and you

Marcus Lemonis

goal, look one to We're ability. it bought share, as what expecting than the and volume as up that business And driving can. capitalist, something ratchet any have we that because which to of units; new this auction principles which call is many driving we XX%, XX,XXX physical it's extract and we find the for a incremental, we're getting the and and give the sell to continue different because an is more But one avenues we're really our business recording is market buy that that we shooting time used for one we'll can it for to discussion, opportunities we it can price online auction buy for, us do and sell we of sure units. ways in our and when This to making all going of us for XX,XXX, at to transaction. the profitable

Matt Wagner

And we back ago, as previously realized used marketplace. declared a that as marketplace efficient more we to the entered year we about we create needed that into a

in we auction. first December hosted last So of year, our

month time shy somewhere the XX periods we've here not in twice auction sit now under into country. now, certain in a cadence where we're we of an where we a have a routinely month X today As nice just belt oftentimes if gotten hosting our times

we've of just type model. over time hosting perpetuity the at auctions online of they're auctions While been X timed an into think like eBay same last months, the where virtual

share. evolution necessarily it's to at all. It's a our of market deviation build think remarket and just opportunity rather continued don't I So this

Marcus Lemonis

One this our looking without of other paying really able to with us we're last go egregious to marketplaces fees inventory; trusted inventory, be where it's parties generate if to a is leads. source some marketplace other a and create go consumers parties' supply private private piece that's other inventory, been at transact we to for dealers' look take established and and you whether can before rvs.com,

Bret Jordan

updates follow-up. about sale? Is you guess I Sam think talked that capitalist Great. on still paid a January, for I them. more last quick you selling for the than And Any it the for things Good Okay. process?

Marcus Lemonis

both what particularly we Board all Because a that to we're we discussions point, and industry a really and process business Sam, part be 'XX, as rock had that capitalists, really a lot team. of the through fazed. management our the in proved of and stable wasn't XXXX senior with despite a Good getting the that's is and And absolute headwinds realized our great just

bright So spot. that was X

We The is relates be team management want and in part Sam Give the said thing auto. to to want RVs. look, only just organization. that powersports chance this us just second recreational Good we to be to to as to and space at explore the us it limited don't has of marine being superb a

other contingent a liability little with on claims than an no roadside As a its assistance. on reminder, bit books of asset-light real that's business

ask be we've we marine, So auto, for team when is if proof could off decision that realized Good explore that it robust of Sam business that permission the to X seeing they go more we and on After to those made here do has Board the markets; to far that. really other stay. the powersports; that points, signed future allow

Operator

Alice from Wycklendt The with next Baird. question is

Alice Wycklendt

used for there thinking just and nice F&I the attachment be want new to difference there. look is touch performance we look Maybe on as to new? segment. as used any of substantial the outgrow for the that I mean But rates maybe about into context between how we in XXXX, should you

Matt Wagner

Oftentimes with slightly F&I used total will spot as be You're a asset, lower. that on. actually revenue percent a of

I percent the anticipate down that towards overly the compared of bit to been throughout XX%-plus this And segment. I'd this would that we've indexing tweak year So little F&I seeing year. new a we've the been entirety

So like favor, leaning XX.X%-ish. down more model that anticipate tweak that which you would to out it more to next new reach maybe actually I'd we year, being I as start segment and as parity we between used, start like in

Marcus Lemonis

the in slight that only increase is The to ASPs. counterbalance

that in basis. in relatively total And consistent a so be accurate, we larger you're definitely to that and so on bring actually gross while unit percentage Matt's is should ASP will applying increase dollars per with a ASPs the a slight

Operator

I Q&A the back This concludes over Lemonis to would session. now to conference for like turn Mr. any comment. our closing

Marcus Lemonis

Great. much Take reporting forward business. to coming We months. so look Thank QX care. supporting you for our the in

Operator

Ladies is and gentlemen, thank The for you over. joining. conference now

may disconnect. You

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