CWH
Camping World Holdings, INC
NYSE
10-Q: Camping World Holdings Reports Mixed Q3 Results Amidst RV Market Shifts
Sentiment:
Quarterly Report
29 October 2024 4:05 PM
Camping World Holdings experienced a slight revenue decrease in Q3 2024, with notable shifts in new and used vehicle sales and gross margins.
Worse than expected
The company's net income attributable to Camping World Holdings, Inc. decreased significantly year-over-year.
The company's gross profit decreased by 4.7% year-over-year.
The company's same store revenue decreased by 2.7%.
Summary
- Camping World Holdings reported a slight decrease in total revenue for the third quarter of 2024, down to $1.725 billion from $1.730 billion in the same period last year.
- New vehicle revenue increased by 21.5%, while used vehicle revenue decreased by 24.2%.
- The company's gross profit decreased by 4.7% to $498.5 million.
- Net income attributable to Camping World Holdings, Inc. decreased significantly to $5.5 million, compared to $16.0 million in Q3 2023.
- The company's active customer base decreased by 9.7% to 4.6 million.
- Good Sam Club memberships also saw a decline of 12.1% to 1.8 million members.
- The company's same store revenue decreased by 2.7%.
Sentiment
Score: 4
Explanation: The document presents mixed results with a significant decrease in net income and gross profit, offset by some positive trends in new vehicle sales. The overall tone is cautious, reflecting the challenges in the RV market.
Positives
- New vehicle sales volume increased by 31.2% year-over-year.
- Products, service and other gross profit increased due to higher labor billing rates and a higher proportion of billable labor.
- Finance and insurance revenue increased due to an increased number of contracts sold.
- The company's total RV and Outdoor Retail inventories decreased by 4.7%.
Negatives
- Used vehicle sales volume decreased by 17.9% year-over-year.
- Average selling prices for both new and used vehicles decreased.
- Gross profit decreased by 4.7% year-over-year.
- Net income attributable to Camping World Holdings, Inc. decreased significantly to $5.5 million.
- The company's active customer base decreased by 9.7%.
- Good Sam Club memberships also saw a decline of 12.1%.
- The company's same store revenue decreased by 2.7%.
Risks
- The company faces risks related to general economic conditions, including inflation and interest rates.
- The availability of financing to the company and its customers is a risk.
- The company is exposed to fluctuations in same store revenue.
- The company is subject to the cyclical and seasonal nature of the RV business.
- The company is dependent on relationships with third-party providers.
- The company is subject to risks related to climate change and other environmental, social, and governance matters.
- The company is subject to risks related to a failure in e-commerce operations, security breaches and cybersecurity risks.
- The company is subject to risks related to pending litigation.
Future Outlook
The company expects to continue to see declines in Good Sam Club members as a result of a price increase and the availability of a free basic plan. The company expects to spend between $75.0 million and $115.0 million on dealership expansion over the next twelve months.
Management Comments
- The company has deepened its appreciation for the non-cyclical nature of the Good Sam business and recognizes its large growth potential.
- Good Sam will continue to benefit from its relationship with the Camping World brand but will be empowered to operate independently to drive growth.
- The company believes it will gain operational efficiencies by exiting the manufacture of RV furniture and focusing its resources on the sourcing and sale of its RV and aftermarket accessory products.
Industry Context
The RV industry is experiencing a period of adjustment with wholesale shipments projected to increase slightly in 2024 after a significant decrease in 2023. The company is navigating a market with lower average selling prices for new vehicles and a corresponding impact on used vehicle values.
Comparison to Industry Standards
- The company's new vehicle gross margins in Q3 2024 were within the range of pre-COVID-19 pandemic periods, indicating a return to more normal levels.
- Used vehicle gross margins were negatively impacted by the need to discount prices to maintain competitiveness.
- The company's unit sales mix is shifting towards new vehicles, which is a change from pre-pandemic trends.
- The company's inventory turnover for new vehicles is slightly lower than pre-pandemic levels, while used vehicle turnover is higher.
Stakeholder Impact
- Shareholders may be concerned about the decrease in net income and gross profit.
- Employees may be affected by changes in compensation and restructuring activities.
- Customers may be impacted by changes in pricing and product offerings.
- Suppliers may be affected by changes in the company's sourcing and purchasing strategies.
- Creditors may be impacted by changes in the company's financial performance and debt levels.
Next Steps
- The company will continue to execute its expansion plans through accretive RV dealership acquisitions.
- The company will continue to monitor and adjust its inventory levels to reflect consumer demand.
- The company will continue to evaluate additional dealership acquisition opportunities.
Legal Proceedings
- The company is involved in ongoing litigation related to the Weissmann Complaint, Tumbleweed Complaint, and Precise Complaint.
- The company is also involved in other litigation arising in the normal course of business operations.
Related Party Transactions
- The company leases various RV dealership locations from managers and officers.
- The company's Chairman and Chief Executive Officer had personally guaranteed the Lincolnshire Lease.
Key Dates
- January 1, 2023: Giftees of common units redeemed 2.0 million common units in CWGS, LLC for 2.0 million shares of Class A common stock.
- March 1, 2023: Management implemented plans to exit and restructure operations of Active Sports, LLC.
- December 31, 2023: Active Sports Restructuring was substantially completed.
- January 17, 2024: Company announced review of strategic alternatives for Good Sam business.
- May 3, 2024: Company closed on the sale of certain assets of the RV furniture business.
- June 1, 2024: Brent L. Moody and Karin L. Bell announced their resignations from their President and Chief Financial Officer positions, respectively.
- July 1, 2024: Matthew D. Wagner was appointed as President and Thomas E. Kirn was appointed as Chief Financial Officer.
- August 2024: FRHP amended the M&T Real Estate Facility to increase the maximum borrowing capacity from $250.0 million to $300.0 million.
- October 1, 2024: Lease termination fee of $1.5 million was paid for a lease terminated during the three months ended September 30, 2024.
- December 31, 2024: Anticipated dissolution of ML Acquisition Company, LLC and its wholly-owned subsidiary, CWGS Holding, LLC.
Keywords
RV, Recreational Vehicles, Camping World, Good Sam, Retail, Dealership, Finance, Insurance, Outdoor, Services, Inventory, Sales, Gross Margin
CWH
Camping World Holdings, INC
NYSE
Sector: TBD
Filings with Classifications
Better than expected
9 June 2025 8:00 PM
Beneficial Ownership Report
- The disclosure of a new 5.3% passive stake by a major institutional investor like Millennium Management is generally viewed as a positive signal for the company, indicating confidence from a sophisticated market participant.
Worse than expected
1 May 2025 5:04 PM
Quarterly Report
- The company reported a net loss, which is worse than breakeven or a profit.
- Active customer count decreased by 14.2% year-over-year.
- Good Sam Club membership decreased by 13.2% year-over-year.
Better than expected
29 April 2025 4:10 PM
Earnings Release
- The company's Adjusted EBITDA increased nearly 4x year-over-year.
- The company's net loss improved by 51.4% year-over-year.
Worse than expected
4 April 2025 4:05 PM
Definitive Proxy Statement
- The company experienced a net loss of $(78.9) million in 2024, compared to net income in previous years.
- Adjusted EBITDA decreased by 37.5% from 2023 to 2024.
- The company had a shortfall from the budgeted Adjusted EBITDA goal of $371.4 million with final consolidated Adjusted EBITDA performance of $178.8 million.
Worse than expected
28 February 2025 9:06 PM
Annual Results
- Revenue decreased from $6.23 billion to $6.10 billion.
- Net income decreased from $52.9 million to a net loss of $(78.9) million.
- Adjusted EBITDA decreased from $286.2 million to $178.8 million.
Better than expected
25 February 2025 4:10 PM
Earnings Release
- The company's Q4 results show improvements in revenue, gross profit, and adjusted EBITDA compared to the previous year, indicating a positive trend.
Worse than expected
13 February 2025 2:00 AM
Beneficial Ownership Amendment
- The document states that the previously disclosed belief that CWGS Holding, LLC and ML Acquisition Company, LLC would be dissolved by December 31, 2024, did not materialize. This non-occurrence of an expected event, particularly one that could simplify corporate structure, is a negative deviation from prior expectations.
Delay expected
13 February 2025 2:00 AM
Beneficial Ownership Amendment
- The dissolution of CWGS Holding, LLC and ML Acquisition Company, LLC, which was previously expected to occur by December 31, 2024, has been delayed indefinitely, as the Reporting Persons do not know when it may occur in the future.
Better than expected
14 January 2025 4:31 PM
Investor Presentation
- Camping World's new unit sales growth of 22% significantly outperformed the industry's decline of 13%.
Capital raise
1 November 2024 4:15 PM
Capital Raise Announcement
- The company is issuing 14,634,146 shares of Class A common stock at $20.50 per share.
- Underwriters have an option to purchase an additional 2,195,121 shares.
- The company expects to receive approximately $288.8 million in net proceeds from the offering.
Worse than expected
29 October 2024 4:05 PM
Quarterly Report
- The company's net income attributable to Camping World Holdings, Inc. decreased significantly year-over-year.
- The company's gross profit decreased by 4.7% year-over-year.
- The company's same store revenue decreased by 2.7%.
Worse than expected
28 October 2024 4:10 PM
Quarterly Report
- Net income decreased by 73.9% year-over-year, indicating a significant decline in profitability.
- Adjusted EBITDA decreased by 28.9% year-over-year, reflecting a substantial drop in operational performance.
- Diluted earnings per share decreased by 71.9% year-over-year, showing a sharp decline in earnings per share.
- Used vehicle revenue decreased by 24.2% year-over-year, indicating a significant drop in sales in this segment.
Worse than expected
13 September 2024 7:09 PM
SEC Form 4 Filing
- The CEO selling a significant amount of shares is worse than expected.
Capital raise
30 August 2024 4:06 PM
Credit Agreement Amendment
- The company has increased its borrowing capacity by $50 million.
- There is an option to request an additional $100 million in borrowing capacity.
Worse than expected
1 August 2024 4:05 PM
Quarterly Report
- The company's net income attributable to Camping World Holdings decreased significantly by 66.0% year-over-year.
- The company's same-store revenue decreased by 10.8%, indicating a decline in sales performance at established locations.
- The company's used vehicle revenue decreased by 22.8%, reflecting a significant downturn in that segment.
Worse than expected
31 July 2024 4:10 PM
Quarterly Report
- Net income decreased by 63.8% year-over-year.
- Adjusted EBITDA decreased by 24.2% year-over-year.
- Used vehicle revenue decreased by 22.8% year-over-year.
- The company experienced a decline in average selling prices for both new and used vehicles.
Worse than expected
3 May 2024 4:12 PM
Quarterly Report
- The company's net loss of $22.3 million is a significant decrease from the net income of $3.2 million in the same period last year.
- The company's total revenue decreased by 8.3% year-over-year, indicating a decline in sales.
- The company's used vehicle sales and gross profit experienced a substantial decline, impacting overall profitability.
- The company's active customer base decreased by 8.8% year-over-year, indicating a loss of market share.
Worse than expected
1 May 2024 4:10 PM
Quarterly Report
- The company reported a net loss of $50.8 million, a significant downturn from the previous year's net income of $4.9 million.
- Adjusted EBITDA decreased substantially by 86.5% to $8.2 million.
- Gross profit and gross margin decreased, impacting overall profitability.
Worse than expected
21 February 2024 4:12 PM
Annual Results
- The company's full-year revenue, net income, and adjusted EBITDA were all significantly lower than the previous year.
- The company experienced a net loss for the fourth quarter.
- The company reduced its annualized cash dividend by $1.00 per share.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.