GOED - Earnings call transcript Q4 2021

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Operator

Good morning, and welcome to 1847 Goedeker Fourth Quarter and Full Year 2021 Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] On the call today are Chief Executive Officer, Albert Fouerti and Chief Financial Officer, Maria Johnson.

First, please note that various remarks about future expectations, plans and prospects constitute forward-looking statements for the purposes of safe harbor provisions under the Private Securities Litigation Reform act of 1995. The company cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated, including the risks described in the company's filings with the SEC. any on on call the circumstances March no to made of only company that statements statements obligation date forward-looking today's XX, update occur forward-looking after this events speak conference as assumes to today. Any reflect these or of XXXX, and

fourth remarks these trends we purposes, for Second, our and a today. non-GAAP we which we special few results had reference results non-GAAP our in excluded in will items quarter from our

release from website to available press A At morning opening in and comments. So cautionary Albert Relations website on our please the be Fouerti. Goedeker XXXX cover Please this go detail. will this our Investor ahead, this Investor in for our conference turn see replay of week. more information I'll more Mr. these statement, Relations over which Fouerti call time, for the topics call the

Albert Fouerti

for call. and today's thank morning, you Good joining

the getting full would for had Before offering we When our platform, evolved the year, XXXX work in both and entity want road selection out our have for past CEO and year be appliances of ahead. combined the challenges to on was knew United the our growth-oriented of I household a cut I us, Goedeker take throughout expansive an of States. the a rewarding last year. e-commerce a the there acquisition and Connection. became September I moments Connection, of for of Appliances year, into a June Through Appliances reflect into we transformation moment results fourth and quarter XXXX to

set the a call strategic solify while managing encountered initiatives should along On first profitable up the to CEO, a sums rapidly with developed of earnings couple last that long-term We issues growth. in that of still a lead official foundation some Board manner. our my I grow for as unprecedented think quarters. I

forward look initiatives in on to a XXXX. many meaningful and have of progress made further We these executing

have announcing made significant overhauling a Goedeker leaders our as with stride recent well leadership of the legacy we senior team hires the First, departure business. several key from

executives individuals and in supply home These belief with of We chain, are our have merchandising. delivery, level. decades take distribution, vision next and aligned that marketing e-commerce, and and share this mission added new to logistics, can long-term we business our the experience with

all Moving levels priority. top-tier remain major at forward, talent a recruiting

XXX,XXX and Second, million to million even XX created compared reviews customers now XXXX. relationships website. visits annual in experienced a in have we deeper site over our more XX retention with have XXX,XXX XX% resulted expert deliveries This in rate. white website glove on made over product visits customer We XXXX, than the used and

the stages we of early made Third, have progress network our expansion. in fulfilment

closer in chain the get and to development home and next installation. We purchasing with to align add This the are to new vision inventory over in areas empowers customer have our year. announce are journey expect markets brand become our fulfilment want on least at to highest a into further remodeling, we geographic to name year. be currently throughout platform will to and from Fourth, half centers penetrate issues we identified first the due two new fiscal to entering this the holding home of agreements customers off that that housing and are we of ethos track we appliance inspiration on although the the and supply to experiencing the levels

enhancing resources meaningful the content of our with that ultimately We and the available are will on relationship website a help customers. us process in create our

solution offering. in progress early some made have we BXB Lastly, our

BXB new pipeline. $XX plus in million the of have We project

and throughout of the year. of remainder pipeline this As on the QX, to build working we are

to months longer-term projects be to in will XX but we to materialize come into these expect We growth BXB this will XXXX. significant may X revenue fruition, that pipeline believe that take

Plus and Plus, and the in BXB build rolled build out to design and projects, that we Pro designers builders enable place. on which purchase front, conveniently on one are Additionally, price the Pro, our interactive website platforms

Connection proud ongoing of these were concern bills conveyed that they am without led headwinds settled Goedeker's, from Goedeker to set in which unprecedented shareholders, refocus I transitioning an to including by pains shareholder the and combining reassessment a related the the come feedback. to the Goedeker issues moment Connection did in our legacy to businesses; leadership company following structure including to we becoming not Outstanding and the have from late challenges I other not a last to industry. supply announced Growing which to While certain large operations take the plug QX, legacy milestones, company, business system, did the chain created processes inventory internal transition that company would Appliances a seamlessly specifically. navigate, the of Appliances of like capital throughout in. platform Public address to topic management August. ultimately

program you the approved we As announced December. share Board been a in that have know, repurchase by

Following the first during were the we announcement, periods restricted quarter. by blackout

share of mind for However, top the remains management Board. repurchase and the the

we in certainly made, are looking we While what XXXX. XXXX to challenges was accomplish were could we and encouraged of and year by progress forward transition, have a the we

fiscal Johnson now EBITDA strong overview could and to performance. of we Maria to solid year Our an initial in financial it over the my that turn sales conclude and a represents remarks foundation I XXXX positive provide on. build growth will

Maria Johnson

million sales net $XXX.X were forma Albert. Net sales fourth Pro the to XXXX. in the forma $XXX.X Good XXXX. were quarter $XXX.X for full million everybody. compared to quarter year sales morning, Thanks, for million, product for $XXX.X the compared million, pro

with the million a end $XX.X for on sales was Pro profit was forma margin a Gross gross full our our was in margin previously million Our the and XX.X% with year XXXX. profit compared came high year guidance. million $XX.X in stated of margin the quarter $XXX for XX.X% to XX%.

hundreds fourth expenses in $XX.X approximately included quarter million, the credit income million were Goedeker build $X.XX and guidance. the of $X.X came $X million, $X.X million. in was $X.X that in previously to outstanding several the also Net the XXXX. largest $X.X $X.X of for margins and thousands share administrative million of was diluted share personnel card quarter with the a common general for of and bank $X.XX items of gross being loss QX, business Our diluted legacy million, expense fees of compared within expense per settled loss for Operating stated our million advertising of for costs which common or expenses quarter a or per

Adjusted share, EBITDA or for of loss diluted a fiscal X% forma diluted income a common $X.XX year $XX.X was million net a the $X.XX EBITDA was per adjusted per of million common compared million million was to pro $XX.X For the full year net X% margin full year, $XX.X or quarter for with of $XX margin. with and share XXXX. loss a

As card operations transition the the from and $XX.X authorization of company to million work flow model. includes of million, to incurred million Goedeker of cash the $XX paid which of end we as XXXX, the that credit for cancellations business from business capital refunds negative legacy had working $XX in

of sustained geopolitical flat uncertainty XXXX. supply the equivalents inflation in Additionally, $XX.X our the roughly and year disruptions, impact and to cash prior With of the combination chain significant had quarter. cash to will outlook, quarter, the million of company us end respect at the

over still outlook growth to to year adjusted able forecasting relatively margins We XXXX We the the the is be flat macroeconomic for low and would are teens and our refine our of year high XX to results. EBITDA headwinds. gross to sales hope course

back to presentation for will Now Albert comments. Albert? the I hand closing

Albert Fouerti

Maria. you, Thank

priorities While our was foundation transition. the we believe that of the year a we gross progress start year have strongly of building to stated In growth, on were more early guidance of margin will stages on this previously we year and fiscal we our that hit already XXXX these. XXXX, sales will that feel began be able execute drive making our meaningful and phase, to a for to key

the remained throughout quarter I year. significant opening margin, respect fourth As in generally supply and with my tight a the highlighted obstacle remarks, as in to

great As the margin by will undisputed likely we are focused We along sustainable expansion. And annual long-term and to targeted and following I value, sales marketing the growth the to fulfilment remaining I'll conclude content we expansive our network providing planned $X company employee relationships. questions. the years. our I'll improving becoming benefit we promotional our pricing on path experience rebates open sustaining in operator in through category that expect on believe, any with supply create offering will still to delivering be continuously some at the call ask the a priorities, expansion customer and time, to chain reliable pursue coming there. believe expert for this selection billion on the shipping, care. fast, staff; improves, leadership, vendor of That, able digital

Operator

will question Meyers first Ryan Our Instructions] come Street. [Operator with from Lake

You now go may ahead.

Ryan Meyers

first The the just me, little into dive for bit. wanted guidance question a to I

teens forma the pro over reported number high or million the growth million XXs to is So $XXX number, this the low number? growth $XXX

Maria Johnson

over pro million $XXX is it the Ryan, number. forma

teens, year growth to still expecting high going are low in we XXs. So high XXXX as in as strong but be this not definitely it's

Ryan Meyers

a volume? this follow-up price a lot Okay. both? of combination see can it then -- good Or just little unpack number kind to and No, to that's bit the of as that, a of growth hear. of is from And you kind or a coming

Albert Fouerti

Ryan, been on It's would continuing infrastructure. for home what We're upgrading we're lot this organic path Albert. good I delivery our working doing There's continue years. company, our growth fulfilment, morning. the in and the organic we've a So on on continuing same is XX growth -- on focused and past, that the that's say, of

from So had the it's growth that before. in the we organic pipeline from still

Ryan Meyers

what are then of update fill sense. on of during the how guys us order give an and half Okay. That they makes in quarter of here And the you kind first you and XXXX? rates can seeing track sort just

Albert Fouerti

Yes.

to So a and was an impact continued there impact would in say, unfortunately, I be XXXX. QX, of huge

was upgrading a we're more on that in here where went But there struggles, to issue. end rate. on of the we our inventory, supply of of auto-manufacturers limited guys as rate having working York size of Our saw and the The bit in of were chain the a continuing infrastructure same the quarter, little is extended we we in We Obviously, warehouse enhancing because our still warehouses fulfilment. growth couple that market add manufacturers more the fill that. there inventory. and the saying on be some the But XXXX. terms impact New fill going added are that's and our are challenges XXXX, enhancing last down you some for

be. as to categories Some they're as are still supposed not good

did fill to down XXs back down rate about going to So XX% point our go rate. fill some at

are hopefully in the QX some QX we of but So or it challenge, seeing light is would say, a tough XXXX. next I done

Operator

Our from question next Capital come Management. will with Greystone Adam Wilk

You go may ahead. now

Adam Wilk

I sort guide 'XX. just year about for wanted the to of fiscal ask

I'm EBITDA hit the of -- to world next the flat kind your me, a not a basically of like the ways, outlined a margins, year from for or you this perspective number EBITDA and case. affected be line, might point would but you maybe margin might the lines your where being your that's conservative? wondering of of along business of cost commentary commentary state in On excuse being you about just that feel kind the year or if from being --

Maria Johnson

Yes.

our exactly to both in streamlining are try level we in some have going I operations, the maintain that though hopefully, structure, XXXX, as have be continue XXXX, cost do think able we working reducing on and our are we even margin do should gross saying same EBITDA challenges to but some headwinds, XXXX. to and continue we we

Adam Wilk

out it the that center you if help Okay. an and with the seeing the maybe on could those me of that if be signing why into fully maybe kind out. immediately agreement operational. getting you maybe the the efforts commentary waiting wouldn't That's can you wondering that's consumer pressing timing kind And maybe dig Is area? on things helpful. little everything internally then open side? wouldn't Or a versus bit lines, about shake demand that understand where along situation sort benefit you kind the gas area, of and in a of And centers I'm fulfilment between of agreements fulfilment or from in where

Albert Fouerti

to transitioning you correct inventory as to correct it obviously, and the want market. Sure. area guys We the with literally locations have now, to it And service us, correct Florida. changing have at a where fulfil of know, Jersey, need lease, enough you New to -- finding the that the -- operation now sure for the have to you lease to effective. that if not market issue right it's would is want major in PO pricing or that issue, deliver product to been inventory inventory in of address A that rocket make the an couple the cost just it's them the enough to you we That's has particular deliver major we months, could you sky them say. the want particular issue move past issue. the that's not to But I

having get it, You to of issue. don't Florida a has up and running. down to orders to deal having routing it have a usually or or but machinery, ago real that is California a is to lows to have enough want people. have can and streamline warehouse we a us to have that's a the that inventory to a we We warehouse. All of and open But you correctly. real Texas, manufacturers have not what get to year and that or is have need Jersey effective, XX to just That's expectation. and so inventory not for amount or ago, equivalent personnel high a up the that about XX of it route sporadic to real want a comes at once months them according or the It at of months big key inventory really time. to right that's the of our sure upgrade enough three it DTAs type make we all expectations in make big do Replace that literally inventory inventory, is an cost The we six what's inventory, PO locations. now. the The inventory don't sometimes few segregate

Adam Wilk

possible to one, last the you would fair That's Okay. reiterate, buyback then be you as as starting for helpful. And to will year? it program -- say Great. just be your soon

Albert Fouerti

periods blackout to allows us Assuming it. that were do or -- yes,

Operator

Instructions] Our question will Capital. with come next Artko [Operator Peter from Rabover

may You now go ahead.

Peter Rabover

make comment actual press wanted a release that is I your just to results. that the guidance say your So growth off did

because some So you results X-K the their pro to that forma I put I'm an to morning. be there in correcting encourage market would confusion sure out this will

share there's So of was goals I can sort plan I with first a in lot of And would warrants. great. capital of us you two dilution questions. One that to I capital -- to get is the guys than you long-term I bigger be guess structure kind talk you your, I you the how mean and guess And strategy the obviously, wanted about be discuss and that's maybe general -- think other there? comment. hoping would I had how would allocation guess, it that buyback, and anything I your

Albert Fouerti

we as the is on To speculate, tariff it management you, guaranteed but company. really far, a buyback don't we'll honest but continue action point, of to right aware now stock with any your a so to minor you be to but our we're and for Board, are in and the program creating focusing position structure a not comment already, have

Peter Rabover

that. the I my from of so appreciate -- second question your, ability retail of whether teens that out terms taking seeing e-commerce a general? more existing I curious I whether is you're from how playing dynamic out, parse this guess market bigger was you XX%. market? e-commerce your share the share in Okay. -- growth versus guess, in kind from growth between year have was to And what to the economic that I

Albert Fouerti

question. Sure. Great

while, -- fragmented and we entered your that that for market. know quite why to that's this known point, we is this And we've very business. So a a

a that's And to, and to business, an this in business. businesses. they're of that's know for independent the of going the with of It's the we're going And going don't type we don't we business, too in continue that's last retain of see retailers. We're it. aspect They not ever-changing that last know they're we in beginning, on growth; absolutely We There's to relationship we to our really we to be where So a have sustainable the dealers give on websites able them right? business. lot type that anywhere and it's they're economic good understood and where them a and going lot the market. lot why efficient right we're differentiated capture to to entered know of platform, now. experience the that's provide that's happening not we real are focused not of especially to that customers. lot and have there. structure focusing environment we our that's how And where going out and organic going a market more out in a be going service that's we with better, there have and to continuous market the of else from fragmented a lot lot and customers, the long-term We a get that long,

Operator

Q&A the Thank This presentation. conference. concludes our well session for today's attending as as you

You may now disconnect.

Polished.com (POLCQ) 31 Mar 222021 Q4 Earnings call transcript