Yahoo Finance Camping World Holdings Inc. Reports Q1 2024 Earnings: Misses EPS Estimates Amidst Revenue Decline
Revenue: Reported at $1.364 billion, falling short of the estimated $1.432 billion.
Net Loss: Posted a net loss of $50.806 million, significantly above the estimated net loss of $31.41 million.
Earnings Per Share (EPS): Recorded a loss of $0.50 per share, deeper than the estimated loss of $0.39 per share.
Same Store New Vehicle Unit Volume: Increased by 16%, indicating a strong market share in new units despite broader industry trends.
Used Vehicle Sales: Declined in unit sales and revenue, with a 14% decrease in units sold and a 28.1% drop in revenue from same store sales.
Gross Margin: New vehicle gross margin slightly improved by 8 basis points year-over-year to 13.9%, while used vehicles saw a decrease of 560 basis points to 17.5%.
Inventory Levels: New vehicle inventory increased by 20.4% to $1.469 billion, reflecting an expansion in stock levels.
On May 1, 2024, Camping World Holdings Inc (NYSE:CWH), a leading retailer of RVs and associated services, disclosed its first-quarter financial performance through an 8-K filing. The company reported a significant miss on estimated earnings per share (EPS) at -$0.39, with actual EPS coming in at -$0.50. Revenue also saw a downturn, totaling $1,364.02 million against expectations of $1,432.30 million.
Company Overview
Camping World Holdings Inc operates under two segments: Good Sam Services and Plans, and RV and Outdoor Retail. The company offers a broad range of services including emergency roadside assistance, vehicle insurance programs, and consumer publications among others. Its RV and Outdoor Retail segment deals with the sale of new and used RVs, alongside related products and services.
Performance Highlights and Challenges
The first quarter saw a 16% increase in same store new vehicle unit volume, a testament to the company's aggressive pricing strategies and market share expansion efforts. Despite these gains, the overall financial performance was hampered by a decrease in used vehicle sales and revenue declines across several categories. The company's gross profit margin slightly decreased from 29.7% to 29.5%, reflecting the competitive pricing and inventory management challenges.
Financial Position and Metrics
The balance sheet shows a slight increase in total assets from $4,845.68 million at the end of 2023 to $5,023.16 million as of March 31, 2024. However, liabilities also grew, indicating ongoing financial pressures. Notably, the net cash used in operating activities was -$67.98 million, a significant shift from the $199.22 million generated in the prior year, underscoring the operational challenges faced by the company.
Management's Commentary
Marcus Lemonis, Chairman and CEO of Camping World Holdings, commented on the results, "Our intentional efforts to drive down invoice pricing and widen the consumer affordability funnel resulted in our new unit sales meaningfully outpacing broader RV industry trends. We drove record new unit market share for January and February."
Outlook and Strategic Moves
Looking ahead, management remains focused on rebalancing the used inventory and expects improvements in the used business segment as the year progresses. The strategic goal to expand to 320 locations by 2028 remains in place, signaling long-term growth ambitions despite current headwinds.
In summary, Camping World Holdings Inc faces a challenging environment characterized by competitive pressures and shifting market dynamics. While the company is making strategic adjustments to navigate these challenges, the impact on its financial performance is evident in the Q1 results. Investors and stakeholders will likely keep a close watch on how effectively the company can turn around its operational strategies to achieve sustained growth.
For detailed insights and further information, refer to the full earnings report and the upcoming earnings call scheduled for May 2, 2024.
Explore the complete 8-K earnings release (here) from Camping World Holdings Inc for further details.
This article first appeared on GuruFocus.
