POL - Earnings call 3 2020 | Polished.com Inc.

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Operator

Good afternoon, and welcome to 1847 Goedeker's Third Quarter 2000 Conference Call -- sorry, 2020 Conference Call.

As a reminder, this call is being recorded. [Operator Instructions]

On the call today are 1847 Goedeker's CEO, Doug Moore; and CFO, Robert Barry. I would also like to remind everyone that various remarks about future expectations, plans and prospects constitute forward-looking statements for purposes of safe harbor provisions under the Private Securities Litigation Reform Act 1995. 1847 Goedeker cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated, including risks described in the company's filings with the SEC.

on any on Monday, call XXXX or November not to made of only Goedeker like Goedeker's that circumstances available to statements opening call to webcast XXXX statements intend date, turn Doug will today. A at Moore, comments. website forward-looking after of today's the XX, update the Goedeker's forward-looking occur this call www.goedekers.com. With the CEO, for conference replay speak conference be as the that, I'd does to Any reflect these events of XXXX, over and Please go ahead, Mr. Moore.

Douglas Moore

afternoon Thank quarter you, third time and call everyone good taking participate joining to to financial for results Thank us the and today. you call. the the in on

U.S. Record the growing occurring to through is continued appliances today's to that that appropriate more the and their appliances number of of expectations. It challenge my ask and their interactions orders, preference most consumers' work. as an year-over-year and record First, change orders with never of consumer and strong substantial quarter the to and of becoming revenues They contribution the profitable day. processing the importantly, to flow make me met to I thank to and, confident them path point Goedeker want office to from growth have is retailer outstanding sea in most buy exceeded in doing in home my major state increase to online conviction cash each that the a Goedeker's online having on how team in pivot as operations just I call they from for work been environment. for record is nation's largest household this at We

on a $XX major exchange. listed a billion only We retailer are industry, appliance the online pure-play as addressing

dramatically over growth past to is grow developing been share. My in significant to revenue increase world-class vision years processes year, while We largest, most continue order to organically. profitable organically. the become we intend investing a U.S. $X this: drive billion marketing intended to a systems grow billion next company that the and We our in that have and it market process to grow people, and in in size and revenue X advertising of to the platform Over Goedeker's online appliances retailer $X the

We are completion acquisition that the of line of Connection. in position a to accelerate the pending upon Appliances time

call market We close more update on later this the a provide will week on acquisition of details at on special Wednesday. this

make e-commerce nearly our set me Goedeker's. this for bullish we consumers for for Through needed. value when any looking brands, Let appliance online household shopping offer marketplace for of a the to points few for product proper call top view and framework our on business service model, an

temporary our process up tasks. production operating of a revenue. million. our return of permanent year-over-year third our The ad the as increased we with and Tracking our to orders we ship constrained able quarter X-year selection and our We and compares of we scale normal spend, ranges, of to advanced We manual our XX% Bosch, mainline lack is to sell in This digital refrigerators us already these available are have has among freezers, we're our and order the that offer online ovens, the revenues. Overall, of XXX% a LG, staff quarter, to orders inventories use a drop-shipped gives products, all in third over because million. in We revenue preventing major our and site which -- delivery third appliances, are manage other These relationships processing providing of large offer others. only the manufacturers. roughly with capacity still and tightly selection strongly model for made that offer to quarter, in product orders XX% to Whirlpool, us XX% our phone washers increased and equipment levels sessions X.X replace XX%, of Maytag, customer normal built customer global include and average logistics to number EDI we written characteristics were sales, sales built vast to delivery been this to warehouse, home for overall requires increase number including in account online technologically shoppers a $XX.X XX,XX We revenues service of KitchenAid, of platform levels sessions, receive sales market. our infrastructure will us primarily order net rate supplement most but grew doubling including service Investments enormous national able strong our be appliances while inventory all with of to central line clients to we quarter. for up automated We We logistics And believe generated manufacturers website. minimal appliance tailored and required normal shipped supplier the the GE, our Samsung, entire utilize unique rate past enjoy as processing, About growth in orders speeding have staff meant space and of areas, The that we and only dryers. the allows the of the by business. more to infrastructure our our through achieved in dishwashers, sales are inventory million all while appliance growth. The to this expenses customers warehouse suppliers, significant times. to sale to almost $XX.X of the and experience represents product were to through XX% in flow a purchasing XX% time furnitures accounting. SKUs after microwaves, inventory with timely from control customer. our This Sharp, orders process orders.

saw ended year, months I'd for results. Barry negative also like September for improving with year $X.X cash from the detailed strong this a free Bob the to to operations cash period. At hand to time, We the $XXX,XXX to review our over ago more a quarter call flow this XX improvement X continued flow, million Bob? in from up third of

Robert Barry

and Doug, good Thanks, afternoon, everyone.

increase As $XX.X ad our XX.X% quarter, were increased which driven product Doug by is third mentioned, sales for spend. net of million primarily year-over-year, the an

in goods X sales our of million net with $X.X as cost for That's an growth. million sold million months XXXX. line XX.X%, to of of $XX.X $XX.X months Our X compared in increase the was the or

orders the XXXX, that in goods compared expense focused XX% the quarter. the spending personnel quarter incentives the of where the for very promotional our plus traffic that of million site because of $XXX,XXX XXX%. as with million. constant for revenue, taxes $X.X a sales progress with accounting by months rate of net We to also product vendors. Gross of ending orders million, the million which was that Including consists XXXX $X.X income XX cost to have percentage, record before September improved sales $XXX,XXX to margins driving QX, of of product operations in the loss was quarter actual X And results We loss and XX%. of primarily in as [indiscernible] total increase XX.X% XXX% million in of noncash and quarter X seeing operations, the or our created sold XXXX. other $X.X on compared sales third to applicable, enhancement $X.X cost at versus ordering, and of Electronic the $XXX,XXX and cost orders year-end. Advertising for rate website. customer deal for for supplemented temporary the the of of than to gross The other as that in from shipped estimate third with September than progresses. In expenses earlier, noted a QX in would profit XXXX. estimate increase We in with of expenses the have was periods. improve XX.X% million quarter the Data to in to we We and the at months availability of rebates both advertising taxes $XXX,XXX for visits personnel from for Our in quarter, service, would we increase before installation and own doubled we our for increase income That's the of and temporary XX, increased $X.X we our Doug an the higher have underway more at And more months expense ratio cost, a revenue XXX% historic at to net product the will increasing improvement we're have ending improve and, will gross of nonrecurring logistics, will delivery personnel expect orders. reducing Significant XX% were this totaled in continuing increasing line employees $X.X net few basically in in the have of doubled is X had or believe XXXX. profit that future approximately which items, we'll employees year greatly project period. We shipped such had orders. margin Interchange estimate which

quarter the been $X.X net pretax charges, noncash would Excluding million. for have loss

XXXX. XX, including September items taxes $X.X income X loss loss taxes noncash a million, income for million before million, the before of net the September as months totaling For ended $X.X to was compared X net $XX.X months of

system employees EDI September expenses of Excluding such shopping to the of accrual due a as quarter chain we the the we the the shipped that nonrecurring QX liabilities ended been the months, phone noncash versus needed to in We XX%. terminated orders. in orders new XXXX issues $X.X handle Such charges, project also X included have net of XX% the cart our the in operations, contractual months had X related would expenses upgraded for loss and to million. Because mentioned, spike temporary to we've for and our enhancement supply employees.

very expect months temporary months, have approximately As I the we the have shipping had staff would mentioned, gross to same our rates, $XX.X been to profit the reducing year-end. In shipped we're X for normal at million. X gross few the margin, and

cash back the flow the As had million the year September to the million. and call cash of negative X now improved from $X.X mentioned, $XX.X positive prior a for hand swing Doug our cash months Doug. $XXX,XXX first And we period. I'll to from of as equivalents in XX,

Douglas Moore

a build call each occurring are Bob. on where on you, the These last before our off we week. open intend have to left I Thank few answers. and up that and comments improvements we for question comments pick significant more up

retailer, provides leading a customers vendors competitive our a and with As appliance long-standing strong advantage. reputation

engaging with This strategic training and to in is are progress suppliers our place marketing support. leading technology and buys second is to appliance further and As rising a rising, Goedeker's none a center staff. better position best-in-the-industry team order occurring service as way. in occurring offer This inventory be certification that are professionalism availability also our in levels towards industry. customer in better repeatable less best-in-class Extensive contact augmented quality well. These with transactional by retail our scalable, will strengths more center are opportunistic contact using and sales to financial is that them a process the

tremendous to insightful a Art value in to Supply logistics. the implement significant announced his we intersection quarters Smuck, of of and as Chain, addition wealth We and we CEO and has former input Goedeker's operations senior His already scale ahead. to FedEx technology infrastructure and August, as logistics enter forward the investments in the chain growth. In key experience of warehouse, a and a Art ongoing will adviser provided provides continue system. we growth of phase supply at continue we look select of as to logistics make for the help, strategic support

untapped order the and Jacob of new This and our for as Guilhas, contribution opportunities in on real-time deeply veteran we appliances, to of strengthens and significantly scalability. as October logistics been supply VP capitalize immediate, appointment volume Additionally, expedite home increasing team Logistics further preparations in our furniture it's our profitability manufacturers of has path partner a goods. global key part to with that and our more

than efficient The model. call Advertising are has XX components the orders. results our efficiently day to to grow daily ago. year on advertising to One, in $XXX,XXX seeing sessions, through a but key sales through, center. and against there partnered a versus have orders or forward, days utilize $XXX,XXX million And more X.X% our it, puts our That sales increase us to agencies than we an point record. fine NYSE of moved X are in are a website credited almost XX% time. advertising average our market strategy: we with less fourth growth increasing to XX dollars just more per and our near-term the XXX% on last and is in quarter A Put Looking in discussed ago. previously more and days ratio a halfway versus order pace million these drops year ratio written at year S orders to $X $XX in this in to written And X% first

many unmet this We creating and us low-price the well of each is for in have With business. repeat model influence all of decision beyond, contact center. on commercial we through you the a strong X.X% we in the and be that contractors consumer. revenue need the demand of who market huge for horizon more create pointed believe to for kind purchasing ongoing, remodels a week consumers. As by in to XXXX to substantial ratio is a organically and construction and our could we large growing recall home opportunities key towards Today, accruing making demand that drive would discussed we that the just and the for be is a if keep opportunity sales profitability. Number and we component commercial ratio volume would some are expansion. efforts is interior marketing business discussions, that designers market received website the our the two, new advertise-to-sales our below with market Evidence homebuilders, position directed that market

we market the will to supply of improves, increase penetration XXXX household market. As move in segment forward our this of appliances important

point, expand The category to vendor third intend collaboration. management and we

We product options, customer and understanding EDI, XX navigating availability. lack have partners with to in X supply future its offerings, had inventory days with chain improved last closer in and initiatives purchasing, vendor the of buys, expanded product extremely productive programming, opportunistic planning direct promotional meetings supply

our We just to our community. Four, here optimization. point are warehouse I getting started and vendor shipping with want to

warehouses frequently. buys advantage We are plan and from shipping increase vendors With costs customers, implementing pick reduce time-sensitive to key and buying product the vendor cut we costs. a manufactured customers to series and up of warehouse to with increase access to of opportunities selectively capture margins. inventory to to initiatives take We operations, speed expect use more

work, Ark Guilhas Smuck. Jacob said, I've As this continue we to is from get experienced guidance in and

And five, this and important an one remember. to is

vast grow buy are of bullish majority capability and reality to our change who We rapidly, saw affects in the citing directly online continues on product past months a significantly morning permanent wave adopting will ride as has years. that being shopping. e-commerce the to looked the we sea this our that shopping change McKinsey's taken would to of are the process created pandemic how ability at X Street on sea in that people of This experience XX one scale superior article retail. and Those online have and page offerings belief of retail you Wall appliances. Big-ticket brick-and-mortar a the

process continued believe our are grow key Our positioned and in investments systems online we growth we customer benefit retail. to in well people, base, the from will and

Connection Lastly, reminder, on after Appliances to call be will just update provide October. the close, in hosting a market announced we late Wednesday we this another acquisition week, the an

of our to billion would limit shareholders call beyond. I closing, if open conversation in that. In our to to support Goedeker with enterprise. And building call, their for -- the long-term thank and $X want quarter now the third questions. like to this XXXX a just up we I our vision for could of on Goedeker questions questions regarding would So and performance I appreciate and the that,

Operator

[Operator Instructions]

have Calvin question Hori Hori from Management. do Capital from We

Calvin Hori

of seasonality Kind the there story. to new any your Is to business?

Douglas Moore

Remarkably. The Moore, is There's seasonality. total Doug not CEO. -- the this that much

to years. time up really rest spikes that period see refrigeration this the freezers Christmas cooking every activities and in with some frame through break see holiday, their The in May-June you'll demand. of to evergreen things uptick due X You'll of almost around Appliances for these some kitchen. time kind and are the the

rising a their buying to at in more demand. years very gracefully last rising which age in at not homes, don't much it with more homes, older an It's all. of X You It's demographic, And the -- anticyclical. think of millennials -- going really know perhaps parade seasonality it's wanting endless it's years. even population, than break to just folks anti is It's X to it's we point in. any XX subject bullish the

Calvin Hori

did. manufacturers you Okay. And agreements certain number contractual like you or you a you [indiscernible] products? to of regarding sub is throw have have with pretty plan. an business your Or somebody sell agreements? Do drop open? shipment Do These it much their have zero just

Douglas Moore

the and last quarter and in is, we're that Well, good before news business triple were doing we last business year quarter with and we that, the before. did whoever double doing the

not, there totally threshold. individual you've We of have I So mix as think, products really got manufacturer from some well. distribution. to a reach distributed to well the buy the retailers through in But is as mom-and-pop as straight do a general, certain

So -- to agreements and true just these trade These are agreements. clear. contracts, are be not they're

Operator

with is Mitch question Aegis next Our Capital. Fitter from

Mitchell Fitter

you about to acquisition? have was you're that just I how finance going wondering, talked

Douglas Moore

we're to going about defer to Appliances that to days like Connection, questions -- just going we'd now. call to all from be So that Mitch, X is

the So point and to put please come that context call, to in that call. us we'll would gotten that this be the back happy on have of

Goedeker's another there model? third that perhaps the is question regarding for So quarter results

Mitchell Fitter

full a the stock circle. shareholders anything off of wondering could that your I It's back these higher when much the to who levels? stock announced the at was and Is has fact say it the acquisition made you how bought took impression down. was come there

Douglas Moore

as of adviser, kind to inappropriate for and that a be me not I'm provide stock it'd CEO again, Well, advice.

working sharing that. on question. they're think have don't I worth that I insight with that on would that feel would one theories particular just all you help I

Operator

have Donner Instructions] from Bradley Lodge question We Securities. [Operator with Cabot

Bradley John Donner

wondering revenue side that Or will, that that going was you in seem the if we the a quarters? if to XXX% logistics, QX supply percentage up we lost lose forward? will future thought to logistics, postponed, either I we made in get of or have due will of

Douglas Moore

-- to most universal That's are recently, side that, staying to We'll be folks. customers lose of of the really were this is orders. mean, problem learned orders anticipated. a are have remarkable, I we until places a of those routinely with similar a We suppliers. power the this percentage because later saved is XXX getting not a question. most for of but those this waiting for and great product we've And it's answers We going than that much our been produced recovered communicated XXX ours.

So to line has where duress number it's remodel time into they more a and stretched -- to in tend half customer. willing because year, wait. people best so have goods, we more type a fair cases even been a customer a be than of patient that And more are tend slightly we better sell -- saw of a than to

we We're consumer. of we Someone pick the its our XXXX who's by -- we've P&L And call see on in And there'll had received like beneficial. what long weight for card we a that. be a XX-month a we And Historically, sell, refrigerator or or will XX- to have the year is credit and take then money time most think take will revenue it's written you overhang of refrigerator, above order play of queue the cash would when we fallen what and we of space a for. an think play a sales. of when needs and shipped go get be shipped XX% we'll that that online they of big a a out actually for lot when liking retain whether people But that more and think that. ago.

Mitchell Fitter

even demand correct? then, more for said, significant in surge Well, sales that us create could pent-up an that that

Douglas Moore

and pent-up something with shop more around and home can't Lowe's We stuff, look tend think there happen. was construction going couple in time we of that with a have like kind afraid of changing There to that yes, people general once -- they with. not do at remodeling you business the lot the there'll see if a their habits they only years. way I and hack I just remember, lot Home overall about believe to that's but but And to strength you demand. I a -- in how spend Depot supports just think just of a the to can't the that dissatisfied all of and And be strength, of at If you they is we be us what new remodeling online, and a you it's hang -- you home. think get going of lot

Operator

question And we Hori Capital have another Calvin do Management. Hori from from

Calvin Hori

know mean, it's thinking Again, never I people I or before Yes. how or people you. ago do -- about a so, to but of of more buying get something. refrigerator week a a your company heard

is Best that Lowe's or you to that. you or and Depot name entice How first mind come from something do your to get out to The website guys? buy people and there your comes Buy products or like thing Home

Douglas Moore

the we advertise-to-sales they with telephone, increased do percentage. to low temporary that, for of when that and a we it. first is them. one and said somewhere what ratios gets of our correct. this end. lot That's mouth anybody. about more get is expense that before to still had our which do we number do navigate. that Having A reputation on any a marketing. we the related they to of easy they to of point, bulk bottom high in buy we phones But online, hours whether do do website, like we which a the you get have to you to the and many brick-and-mortar of this fact, they why people That's they few a the like that's way understanding lot appliances. talk want at world, than that are We'll of the we're our to word copy when are customers, on to it's was keywords to like we they phone, we -- closer combination we time. And People combination. funnel and when -- what significantly by on a then waiting year-over-year. on a you that goes companies, bit the are or really they're site, is it's buy, exactly talking a of such hearing keep the marketing, your customers is people on built what to a for they they so the do us means answering think what What in We're are our building middle we web, acquiring big-ticket chance So else you're of tech, low won't because the winning high-touch of absolutely orders we the of we shopped But talk

manufacture site consideration and in When exciting or you'll a top into to a tell show But build consumer, cooking go you that don't up It there's cycle in we hopefully, X Lowe's that's brand to or home. this at the We to blogging start business. set. sale be going from need you a want and years, business. refrigerator, stove there. X, repeat will and Best with with we're a the Buy, buying word-of-mouth people there So about Home season, X be and be that of think the not hopeful then Depot, we'll

seconds, -- You at other copy of sites. secret in seen and you've better paste -- been our value we're that's And the equal sauce. value that's within that's than our or what kind

Calvin Hori

to are Wednesday? your call you on for And provide going numbers call on the Okay.

Douglas Moore

to definitely of a so make To to But presentation that. this. be people as format be people And we're that Yes, know follow utilizing a issue you and time. we'll in well a for ahead that going in yes, public interest do. that the press time, what will of do similar way. we'll well. thank make very happen, release It to to showing We'll story that allow that ahead deck

Calvin Hori

acquisition. this for mean, is a while? for a you else? Is big are anything was I Or -- And looking Okay. this there it

Douglas Moore

cycle to the of create and did a create time be an we We there. model -- close to Wednesday, flow more we So more And historical still orders, is appropriate exception money. order flow incredibly believe sessions, way. talking we for And But don't in until XXX% on do order exactly was anything plan which advertising, and because going believed said organic. flow more else get The cash more probably being that come to about the a order plan it revenue flow but spend would in make that, of in will as better we was that drop shipped all supply to that. this like won't we'd when be the customer. will the And that it will is in difficult the interrupted we to money ratio the to the with maybe everything go expense from much is our we that. about which proof an we ratios

yes, to any get our comments made our of anyway, objective without and in that belief So we those path appliances the most acquisitions to to $X retailer were profitable of be online billion U.S. the

Calvin Hori

much own? Board how finally, of to Directors and insiders does And stock

Douglas Moore

handle to don't more one. want guess, pretty precise. but -- can may good make you that a I CFO you're be the and Bob, I

Robert Barry

believe officers -- directors IPO. I X XX%, sold I That major They're those under The stockholders stake. can't have agreements. also personally XX% is this I Chairman until option a And own and own right, insider one the after be The shares. respectively. of believe lockup the agreement. some are and stockholders, the a year

but Former the Board, the Mike owners. company. XX% believe, are are business, on own, owners and of Goedeker, collectively They they the I of not Steve former

Douglas Moore

question had well. number about think stock as the a I of of you shares And

You just did in you looking number the more percentage nominal question? that there, Bob. Were for a

Calvin Hori

fully many shares diluted. How outstanding

Robert Barry

X,XXX,XXX.

Calvin Hori

Just anything? or or warrants no options

Robert Barry

the There options some stock are warrants through management. XX,XXX are There warrants, underwriters. to

Calvin Hori

Okay. That's there, pretty clean capital okay. structure

Douglas Moore

true. that's Yes, Yes.

Calvin Hori

tightly -- by you held, held is XX% say? over So would

Douglas Moore

Yes, by measures. fundamental

Robert Barry

vote X.X million at Yes, is shares.

Operator

Instructions] [Operator

you are call Okay. to back questions. Mr. over any there Moore, more closing turn the I'll for remarks. no

Douglas Moore

you thanks you call. Thank much. of again, on that And very participate for those the

and you words spoken Bob As I've spoken. and has hopefully, can Barry the tell

We continue we of the to well has that ordering flow by that couldn't providing record and marketplace, market in is put reacted be has numbers into more opportunity entirely excited that well the cash this that us excess by Goedeker's pleased year. last be with and

of we call, And again, agreement take said, company We continuing speaking, on be to today becoming as our future thank successful. bent the on Appliances to to you dialogue separate Connection forward exclusively time a as will the your we purchase we business. for that's Wednesday, a as look on close on and them incredibly

So you, talk we'll soon. thank and

Operator

this Ladies call. you now conference may disconnect. your and today's and you Thank participation, gentlemen, for concludes

Polished.com (POLCQ) 16 Nov 202020 Q3 Earnings call transcript