EZFL - Earnings call transcript Q2 2022

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Operator

Good day, everyone, and welcome to today's EzFill Holdings Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. Later, you will have the ask questions during the question-and-answer period. [Operator Instructions] It is now my pleasure to turn today's call over to Investor Relations, John McNamara. Please go ahead.

John McNamara

Ashley. you, Thank and the everybody, quarter again joining for results. Good conference thank call for EzFill second to us afternoon, you discuss financial XXXX With Chief Mike Levine, management Financial us and Chief Officer; Arthur McConnell, Officer. today from Executive are

intends, annual laws. remind undertakes Risk anticipates, website. to by over from available Mike should, forward-looking documents of obligation as and forward-looking McConnell. by in except to or forward-looking subject or estimates report believes, as control similar ahead, Form during matters company, those Factors expressions this under statements of or statements. XX-K the these company are implied of those as now that on as words the plans, would of the such SEC's the well call of with the of differ projects, are materially including for SEC. no many changes set results call as to provided hopes, securities The statements. that statements may on call, section variations Copies statements company's are to update date conditions, may are certain I'd identify law. Mike. required defined to turn revisions or the such expressed like the filed Before forth beyond we be we the Words questions everyone which in intended these Actual after website company's Go may, begin, numerous answers These usual, expects, the such discussed as today's may federal constitute to

Mike McConnell

afternoon, our quarter us Good XXXX everyone, results. thank and Thank joining review you second today to you, for John.

level, more growth one continue XXX% on-demand expanded with release than last gallon to the the our As performance. On by from improved We We per very providers. execute we fastest-growing macro pleased our grew key a second the of strategy revenue indicated, quarter margin as drive remain our our our mobile Overall, business centers. in we're our strong. fuel of press and trends operations that year. population

services, Fleet eliminate their reduces well convenience goes value beyond see of the preference downtime that will the towards and to line by and same the cost. the companies stations. do of don't country. on-site We a bottom preference cities we I'd a proposition in and not clearly favorable have At certainly that a our on-site driver services don't gas in consumers helping time, of delivery we strong currently growing for in anecdotally decline is environment But continue to state. note see national the number certain trend, recognize a course, see as new for We extend and fraud, that California. political mobile The well it business we that as evidence goods that And remains companies them commercial help continue stations California strong to fueling. stations come necessarily as recognize the provide of as have throughout on-demand market demonstrated this the their indicates new consumer which fueling. gas total banned gasoline

the to fleet the Arthur beginning in country's bringing continue number that new grows. our XX%, the land development this our large customer. of only one to each Before developments single added the any did business is and grocery QX key approximately in performance. as than was new a we the In results a highlight number quarter, IPO, Not quarter, customer. itself, XX a few with approximately drive of agreement, upon total a since largest our almost At I'd positive reliance our XX. like store reviews commercial of we as to our financial new time came We've business in XX% that We our and reduce for of from of customer QX, but customers chain. year down one less the

are that the and we get our grocery demonstrate markets now operations an while diligently they for this making have client consumers is commercial support as Miami. a and to While we to marine state in demand growing well. deliveries markets. opportunity specifics us, additional consumer beyond with entry And as the decision and Tampa we value Beach, to well-known markets home them. Palm relationship expand ideal we just can meeting can't customer demand for into already chain among about are locations, into We've we approvals – the expanded identity, decisive begun a are proposition West retail residential working our the these as these we delivery, to Orlando, grow, in

specialty continue on-demand Our combined consumer of and contribute approximately XX% our business to revenue.

as including the XX at and XX of planned delivery marketing Our grown at end QX launched brand plan, delivery This to billboard we our recently media excited fleet We're a posts. campaign is outdoor, banners, more barge, aerial social grow. be size was about and for has awareness. vehicles with aimed comprehensive building since to going radio

a results. into we're to putting of forward lot this, effort and the So looking we're

can Fuel clients their Program fuel ensure a should As we hurricane easy we're we fueled. have that supplies, that season, Emergency remain in launched delighted to will approach rest knowing disrupt Services vehicles hurricane our which

that progress over walk and we these what And it's turn we to verticals, delivered I'd ahead, financial we'd said I see deliver. six customer diversified growth strong in quarter three fair We've results. who for markets growth added laid first on we of that the We've as well continue you all made growth going through Arthur, to Go that, the sequential the and We've think we'll key and the With months to in So as customers expect call will both forward. initiatives. into We the increased say continued fleet. groundwork showed period. our base. from new we've steady months and revenue three period Arthur. our progress expanded strong

Arthur Levine

Mike. Thank you,

reflects results demand ramps. the revenue and business, the million for increased to million prior fuel insurance $X.X increase continue the illustrate XXXX increase increases payroll, into were say, for gallons million compared $X.X our primarily second excluding Revenue the of in to were second Fuel were a per markets by amortization, saw XXX,XXX to per infrastructure hiring prior to million period. quarter quarter. $X.XX already in new for gallon. outlined $X.XX the increase should this, XX% we XXX,XXX XXXX. went the the $X.X compared our the the higher prior XXXX expenses. The financial environment been. quarter I – community, driven in to to quarter investment was were in the year second but public significantly from it in support drivers the of per the XXXX $X.X the in to of margin mainly period. fuel We're as of sales $X.XX new cost million mix, in year in per second the XX% Keep markets. increase per XXX% growth gallon, to period, the we've margin quarter of to for from of The structure, gallon of million. share in the a – total the delivered our able $X.XX accounts in as the of investment in fleet second mind to growing increase rising, sales was Our million overall only we well support gallons especially It Ukraine. period, Cost major quarter depreciation addition as in outbreak to $X.X prices in increase company expenses, for war the due the Operating the in net additional challenging average margins everyone's what at and to year maintain Despite share have from

operating year to a to Interest compared the Adjusted $X to EBITDA in repayment the Depreciation spending to continue and loss We fleet delivery XXXX infrastructure the the strong. prior On fleet in million quarter increased in in period. fuel $X loss loss the prior expect quarter remain of amortization noted. expense second of due million marine, XXXX of the previously increased million the margin grow compared million reported the second and Dip] increased a the of in $X.X XXXX. in XXXX early the consumers, quarter in will $X.XX reflects quarter expense increasing second was in business gallon XXXX primarily of $X.XX debt. number The of pre-IPO of from commercial million in in $X.X more areas net second of GAAP continue that and of period, we loss accounts of year add the a to million basis, average vehicles. [Audio an second quarter as quarter in XXXX our including to September per to the expand on we decreased

position $XX.X Our with of $XXX,XXX. cash quarter long-term million, at end no at had $XX.X had XXXX. year-end credit outstanding including line and We under million investments, debt was our borrowings compared

QX recently the both our we home growth increasing in strong in new strong and continue optimize of to entered support QX. that remains our order began demand Our contracts top most Miami We and fleet markets. our in in our to infrastructure reflecting serve we The in market is results quarterly QX. enhance markets efforts recent to reflect in QX, growth experienced line signed and to new in

we utilization we to more increase and scale serve continue will consumers our business, As truck more each of businesses and in and our market fleet.

under the it of delivery We fleet before year-end the reach by and QX, commitments. XX size to current end could XX approach expect

In in developments evaluate we to current monitor when truck our remaining take and than under to truck continue to trucks. our invest we will grow business will enough the more meantime, commitments capacity and additional we make as We deliveries will in planned. have availability commitments the when

campaign Going sales a to additional as completing spend our will progress. advertising hiring as to and in currently markets support new as reps on well the needed that drivers focus is forward, we continue with

built happy to core support we With We careful other out infrastructure to any be take will that, already our growth. spending questions. be our as about have we'll

Operator

first We'll with Instructions] line Please from question Tate your Group. our open. Maxim Sullivan go ahead, is take [Operator

Tate Sullivan

do where fleet thank before out your you already you end to to Or XX. on have various planned of have current afternoon, and trucks and related plans, Starting Mike too, for approach then Do will ended Arthur. those already you. the Good depend Hi, does that at and go? expansion locations factors? where with Arthur – the XX you quarter could this planning

Arthur Levine

they're where – next in we'll and – trucks Well, probably quarter, today, needed. a XX then trucks market of new enter take most market we're the And two trucks. – are we mean, going to those If so to the already going yes, deployed. that other deploy I we're as we're two we in then have

Tate Sullivan

that, – And then, in or to to getting the to mean existing does another go start having customers city another start about Mike, I related planning the already fleet with it area. logistics or expansion, operate please? it how for the employees? Does fleet parking, have to logistics it start the works of with new the Can for customers infrastructure, there? you about talk refueling, but

Mike McConnell

sorry state and regionally and about to our relationships Yes, that with We'll them expand. business our in are current locations with to that Miami leverage even continue Yes. theirs nationally question. discussions Good the have ones having multiple about that. growing along with throughout

that on hopefully, calendar will be market at York this growing New and we're planning to sometime looking and a year. into, entering continue

leveraging continue So expand, our relationships. certainly, current to we'll

Tate Sullivan

or refueling is parking infrastructure? concern behind cities a Just simply the is pressure? vehicles finding not cost and the And infrastructure to the a expanding that for other just really

Mike McConnell

the lot need Yes. you're you what We've And the right, the expansion as parking, environment, the it's getting process. in the Orlando the Tampa Palm and as West far as those learned of facility, things. expansion a and compliance of approved in part as kind fueling, regulatory far about Beach,

enter. will idea plan the it leveraging are minimum with business good view. a market is fleet So to as it takes requirements business how and start But much and take, think into a have what servicing our to the from enter the we I we a of fleet of what point

start been one. have into new go able we revenue we'll to with the Certainly, leverage results be as from cost good that quarter. In incurred of But the streams that we'll Palm that stream revenue the costs the of this West our to as really to and a a of start which we've will So expansion Orlando. lot Tampa we'll day since done in already proceed a QX, see process. also, of some far seen markets, Beach, expansion lot benefits these we've as have

Tate Sullivan

customers I in quarter. mean XX the

I I mean I mean, counted – correctly, now. I you're and you correctly, XX – up heard if I think from at

momentum? But in quarter. that's customers up not seasonal XQ right. perhaps? What So and before nonetheless, signing in I smaller to prior maybe were is it you quarters, – created exactly the that Or customers? mean XX XX two it signing this XXXX potentially, up Is than

Mike McConnell

it's – is get we our fleet. and think that, I instant part No, it response. with sales We've of really some added an

got we've four people, some the entered into. now and some markets that new those we've So markets in of five of

So time those I in markets. think also, we've some got

grow. continuing to fleet continue to we're optimistic about relationships and and have, that business grow as promote we we our salespeople continuing extremely leverage currently So to the our are

Tate Sullivan

it four continue. it And then comments, like there's per momentum, a the questions not predictable now, price see mean average quarters. you have is – up contracts, once there mean I I there quite I discussion? if in can Are gallon, where there's sounds other three, on to – – momentum and margin average higher as those margin can customers. you gallon Okay. fleet so see to that the mean, Are what come any if to And you that your back you the Great. Arthur, I'll the impressive, seems per and you last the to are downside mean, sign maybe after risks I current like

Arthur Levine

Tate. that, answer I'll Yes,

portion there new this large – business at did that very that, So more the a new But right. except – a the add medium-sized average. or significant drag lot in had up were were of markets, small large business, fleet new new going signed the healthy large margin was overall I'll one been margins fleets to that existing of fleet there flat been the because on for was all fleets increased that the And a the quarter. up to very one average less very we has new have the were that

all existing really markets. well. but new there helped a also as mean of the that market significant new in So I was business in the

Tate Sullivan

you both. Thank

Operator

And if have Mr. your continue further questions. any you with Tate, you questions, can

Tate Sullivan

Okay.

release Just one thank more. in operator. – the saw I you,

You mentioned three verticals the in market.

the please? I see retail, is fleet, and I did marina. mean the So that Or the third correctly,

Mike McConnell

Yes, of I is mean the kind we marine, landscaping, specialty specialty call what right. business, construction, things. that's those

So fleet consumer we've includes then the residential. really got vertical is which and which specialty,

Tate Sullivan

Or you're that that is signing you consumer there Great. And Okay. the – already? how you consumer – is marketing. initiative? out are customers effort, currently up Or Are to come?

Mike McConnell

process. Yes. No, in it's kind of

on went would robust we I in June a time So starting say, very May, campaign, the period.

we've response the results as a the which which So What lot. understand has most and we're and to through far the pretty But now us. it effective track then just But got the return beginning channel to get as the a We're lot is process for evaluate lot to the well. results really been process the entire and receptivity, is understanding order of do effective. received cost and are most a of – gathering of back. of information learning tactics downloads, the the initial which

So detail QX learn that as in probably we'll more. we be on more reporting definitely

Tate Sullivan

all for all imagine Great, you your that. experts on be very all the thank regions. in answering can And questions. I the Yes, much you'll fueling

Mike McConnell

Tate. Thanks

Operator

And turn McConnell there are further call to no the over any closing for questions. back Mike I'll remarks.

Mike McConnell

a good just you. third to you evening. I to forward joining the to quarter. all us, in Okay. Have and want we back you thank reporting Thank for look say

Operator

Thank Thank today's you. your participation. program. This does you conclude for

any at You may time. disconnect

EZFill (EZFL) 14 Aug 222022 Q2 Earnings call transcript