Camping World Holdings Inc. (NYSE: CWH), a retailer of RVs and related services and products, today (Nov. 2) reported that revenue increased 21% or $290.8 million during the company’s third-quarter, which ended Sept. 30.
Third-quarter operating highlights and year-over-year comparisons:
- Revenue increased 21%, or $290.8 million, to $1.679 billion;
- Gross profit increased 57.5% to $533.1 million and gross margin increased 737 basis points to 31.8%;
- Selling, general and administrative expenses increased 7.8% to $323 million and selling, general and administrative expenses as a percentage of gross profit were 60.6% for the third quarter and 65.1% for the nine-month period ended Sept. 30;
- Net income increased 337.2% to $154.8 million and net income margin was 9.2% for the third quarter and 7% for the nine-month period ended Sept. 30,;
- Adjusted EBITDA increased 258.4% to $217 million and adjusted EBITDA margin was 12.9% for the third quarter and 11% for the nine-month period ended Sept. 30; and
- Cash and cash equivalents, maintained in our primary cash accounts, was $482.6 million on Sept. 30, and the company also maintained an additional $104.3 million of cash in its floorplan interest offset account on Sept. 30;
- The total leverage ratio under our senior secured credit facilities was 2.3x at Sept. 30 and the company expects the total leverage ratio to be below 2x at Dec. 31.
“I am very pleased with our team’s performance in the third quarter,” said Marcus Lemonis, chairman and CEO of Camping World Holdings Inc. “Coming off of an extremely positive second quarter, demand remained strong and we were able to achieve record-breaking third-quarter results with net income of $155 million and Adjusted EBITDA of $217 million. Our ability to focus on fundamentals including maximizing gross margins and maintaining expense controls was key to our success in the quarter. Our year to date net income was $304 million and Adjusted EBITDA was $474 million.”
2020 Adjusted EBITDA Guidance Update
As a result of the company’s financial performance during the three months ended Sept. 30, it is updating its 2020 Adjusted EBITDA guidance from a range of $460 million to $490 million to a revised range of $495 million to $515 million.
Stock Repurchase Program
On Oct. 30, the company’s Board of Directors authorized a stock repurchase program for the repurchase of up to $100 million of the company’s Class A common stock, expiring on Oct. 31. Repurchases under the program may be made in the open market, in privately negotiated transactions or otherwise, with the amount and timing of repurchases to be determined at the company’s discretion, depending on market conditions and corporate needs.
Open market repurchases will be structured to occur in accordance with applicable federal securities laws, including within the pricing and volume requirements of Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The company may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of its shares under this authorization. This program does not obligate the company to acquire any particular amount of Class A common stock and the program may be extended, modified, suspended or discontinued at any time at the Board’s discretion. The company expects to fund the repurchases using cash on hand.
Earnings Conference Call and Webcast Information
A conference call to discuss the company’s third-quarter 2020 financial results is scheduled at 3 p.m. Eastern Time, today (Nov. 2). Investors and analysts can participate on the conference call by dialing (888) 394-8218 or (323) 701-0225 and using conference ID# 8428019. Interested parties can also listen to a live webcast or replay of the conference call by logging on to the Investor Relations section on the Company’s website at http://investor.campingworld.com. The replay of the conference call webcast will be available on the investor relations website for approximately 90 days.
