Camping World Holdings, Inc. Reports First Quarter 2023 Results, Record Used Unit Sales and Used Gross Profit, Plans to Continue Aggressively Acquiring RV Dealerships

May 2, 2023

LINCOLNSHIRE, Ill.–(BUSINESS WIRE)–Camping World Holdings, Inc. (NYSE: CWH) (the “Company” or “CWH”), America’s Recreation Dealer, today reported results for the first quarter ended March 31, 2023.

Marcus Lemonis, Chairman and CEO of Camping World Holdings, Inc. stated, “As we predicted, despite softer new vehicle demand and gross margin in the quarter, we saw record setting gross profit performance in used vehicles and Good Sam Services and Plans. What’s most unusual about this moment is the rapid and recent influx of dealership acquisition opportunities, which we haven’t seen since we went public. Based on our acquisition activity year to date, we anticipate the pipeline will fill up, and we plan to capitalize on it.”

First Quarter-over-Quarter Operating Highlights

Revenue was $1.5 billion for the first quarter, a decrease of $175.5 million, or 10.6%.
Used vehicle revenue was a record $444.7 million for the first quarter, an increase of $41.7 million, or 10.4%, and used vehicle unit sales were a record 12,432 units, an increase of 1,456 units, or 13.3%.
New vehicle revenue was $646.8 million for the first quarter, a decline of $188.2 million, or 22.5%, and new vehicle unit sales were 13,912 units, a decrease of 5,108 units, or 26.9%.
Products, service and other revenue was $207.7 million for the first quarter, a decline of $7.3 million, or 3.4%. Growth in service and parts revenues partly offset larger declines in our direct to manufacturer RV furniture revenues.
Same store used vehicle unit sales increased 7.0% for the first quarter, and same store new vehicle unit sales decreased 30.6%.
Gross profit was $441.0 million, a decrease of $119.2 million, or 21.3%. Total gross margin was 29.7%, a decrease of 404 basis points. The decrease in gross profit and gross margin was driven largely by the decrease in new vehicle revenue and related finance and insurance revenue and an increase in the cost of new vehicles sold.
Floor plan interest expense was $20.8 million, an increase of $14.5 million, or 232.1%, primarily as a result of the rise in interest rates. Other interest expense, net was $31.1 million, an increase of $16.8 million, or 117.6%, primarily as a result of the rise in interest rates and a higher average principal balance.
Net income was $4.9 million, a decrease of $102.4 million, or 95.4%, driven primarily by the pretax $101.4 million decrease in new vehicle gross profit, the $23.6 million decrease in finance and insurance gross profit on fewer vehicles sold, the $16.8 million increase in other interest expense, net, and the $14.5 million increase in floor plan interest, which was partially offset from the $19.6 million decrease in selling, general, and administrative expenses and the benefit to income tax expense from these net reductions of pretax income.
Diluted earnings per share of Class A common stock was $0.05 in 2023 versus diluted earnings per share of Class A common stock of $1.02 in 2022. Adjusted earnings per share – diluted⁽¹⁾ of Class A common stock was $0.14 in 2023 versus adjusted earnings per share – diluted⁽¹⁾of Class A common stock of $1.15 in 2022.
Adjusted EBITDA⁽¹⁾ was $60.8 million, a decrease of $121.3 million, or 66.6%, driven primarily by the $101.4 million decrease in new vehicle gross profit, the $23.6 million decrease in finance and insurance gross profit on fewer vehicles sold, and the $14.5 million increase in floor plan interest, which was partially offset from the $19.6 million decrease in selling, general, and administrative expenses⁽²⁾.

____________________
⁽¹⁾	Adjusted earnings per share – diluted and adjusted EBITDA are non-GAAP measures. For a reconciliation of these non-GAAP measures to the most directly comparable GAAP measures, see the “Non-GAAP Financial Measures” section later in this press release.
⁽²⁾	The $19.6 million decrease in selling, general, and administrative expenses includes a $5.3 million decrease in equity-based compensation. Equity-based compensation is excluded from the calculation of Adjusted EBITDA (see the “Non-GAAP Financial Measures” section later in this press release).

Earnings Conference Call and Webcast Information

A conference call to discuss the Company’s first quarter 2023 financial results is scheduled for May 3, 2023, at 7:30 am Central Time. Investors and analysts can participate on the conference call by dialing 1-877-407-9039 (international callers please dial 1-201-689-8470) and using conference ID# 13737788. 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.

Presentation

This press release presents historical results for the periods presented for the Company and its subsidiaries, which are presented in accordance with accounting principles generally accepted in the United States (“GAAP”), unless noted as a non-GAAP financial measure. The Company’s initial public offering (“IPO”) and related reorganization transactions (“Reorganization Transactions”) that occurred on October 6, 2016 resulted in the Company as the sole managing member of CWGS Enterprises, LLC (“CWGS, LLC”), with sole voting power in and control of the management of CWGS, LLC. The Company’s position as sole managing member of CWGS, LLC includes periods where the Company has held a minority economic interest in CWGS, LLC. As of March 31, 2023, the Company owned 52.6% of CWGS, LLC. Accordingly, the Company consolidates the financial results of CWGS, LLC and reports a non-controlling interest in its consolidated financial statements.

About Camping World Holdings, Inc.

Camping World Holdings, Inc., headquartered in Lincolnshire, IL, (together with its subsidiaries) is America’s largest retailer of RVs and related products and services. Our vision is to build a long-term legacy business that makes RVing fun and easy, and our Camping World and Good Sam brands have been serving RV consumers since 1966. We strive to build long-term value for our customers, employees, and shareholders by combining a unique and comprehensive assortment of RV products and services with a national network of RV dealerships, service centers and customer support centers along with the industry’s most extensive online presence and a highly trained and knowledgeable team of associates serving our customers, the RV lifestyle, and the communities in which we operate. We also believe that our Good Sam organization and family of programs and services uniquely enable us to connect with our customers as stewards of the RV enthusiast community and the RV lifestyle. With RV sales and service locations in 42 states, Camping World has grown to become the prime destination for everything RV. For more information, visit www.CampingWorld.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements about macroeconomic and industry trends, expected impact of the subsidiary conversions on our ongoing income tax expense and tax distribution requirements, dividend payments, our business plans and goals, the strength of our business, our long-term plan, the Company’s strategic focuses including growing its used RV business, enhancements of wages and benefits of employees, the Company’s acquisition pipeline and plans, and future financial results. These forward-looking statements are based on management’s current expectations.

These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the following: general economic conditions, including inflation and interest rates; the availability of financing to us and our customers; fuel shortages or high prices for fuel; the success of our manufacturers; general economic conditions in our markets; changes in consumer preferences; competition in our industry; risks related to acquisitions, new store openings and expansion into new markets; our failure to maintain the strength and value of our brands; our ability to manage our inventory; fluctuations in our same store sales; the cyclical and seasonal nature of our business; risks related to the cybersecurity incident announced in February 2022; our dependence on the availability of adequate capital and risks related to our debt; risks related to the COVID-19 pandemic; our ability to execute and achieve the expected benefits of our cost cutting or restructuring initiatives; our reliance on our fulfillment and distribution centers; natural disasters, including epidemic outbreaks; our dependence on our relationships with third party suppliers and lending institutions; risks associated with selling goods manufactured abroad; our ability to retain senior executives and attract and retain other qualified employees; risks associated with leasing substantial amounts of space; risks associated with our private brand offerings; we may incur asset impairment charges for goodwill, intangible assets or other long-lived assets; tax risks; regulatory risks; data privacy and cybersecurity risks; risks related to our intellectual property; the impact of ongoing or future lawsuits against us and certain of our officers and directors; and risks related to our organizational structure.

These and other important factors discussed under the caption “Risk Factors” in our Annual Report on Form 10‑K filed for the year ended December 31, 2022 and our other reports filed with the SEC could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent management’s estimates as of the date of this press release. While we may elect to update such forward-looking statements at some point in the future, we disclaim any obligation to do so, even if subsequent events cause our views to change, except as required under applicable law. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release.

Future declarations of quarterly dividends are subject to the determination and discretion of the Company’s Board of Directors based on its consideration of various factors, including the Company’s results of operations, financial condition, level of indebtedness, anticipated capital requirements, contractual restrictions, restrictions in its debt agreements, restrictions under applicable law, receipt of excess tax distributions from CWGS Enterprises, LLC, its business prospects and other factors that Camping World’s Board of Directors may deem relevant.

We intend to use our official Facebook, Twitter, and Instagram accounts, each at the handle @CampingWorld, as well as the investor page of our website, investor.campingworld.com, as a distribution channel of material information about the Company and for complying with our disclosure obligations under Regulation FD. The information we post through these social media channels and on our investor webpage may be deemed material. Accordingly, investors should subscribe to these accounts and our investor alerts, in addition to following our press releases, SEC filings, public conference calls and webcasts. These social media channels may be updated from time to time.


Camping World Holdings, Inc. and Subsidiaries
Consolidated Statements of Operations (unaudited)
(In Thousands Except Per Share Amounts)

	Three Months Ended
	March 31,
	2023			2022
Revenue:
Good Sam Services and Plans	$	46,367		$	44,559
RV and Outdoor Retail
New vehicles		646,752			834,959
Used vehicles		444,746			403,032
Products, service and other		207,661			214,973
Finance and insurance, net		129,772			153,378
Good Sam Club		11,582			11,495
Subtotal		1,440,513			1,617,837
Total revenue		1,486,880			1,662,396
Costs applicable to revenue (exclusive of depreciation and amortization shown separately below):
Good Sam Services and Plans		16,152			16,703
RV and Outdoor Retail
New vehicles		557,542			644,370
Used vehicles		341,947			302,825
Products, service and other		129,018			136,160
Good Sam Club		1,201			2,136
Subtotal		1,029,708			1,085,491
Total costs applicable to revenue		1,045,860			1,102,194

Gross profit (exclusive of depreciation and amortization shown separately below):
Good Sam Services and Plans		30,215			27,856
RV and Outdoor Retail:
New vehicles		89,210			190,589
Used vehicles		102,799			100,207
Products, service and other		78,643			78,813
Finance and insurance, net		129,772			153,378
Good Sam Club		10,381			9,359
Subtotal		410,805			532,346
Total gross profit		441,020			560,202

Operating expenses:
Selling, general, and administrative expenses		365,726			385,315
Depreciation and amortization		14,637			25,535
Long-lived asset impairment		7,045			—
Lease termination		—			178
(Gain) loss on sale or disposal of assets		(4,987	)		49
Total operating expenses		382,421			411,077
Income from operations		58,599			149,125
Other expense:
Floor plan interest expense		(20,810	)		(6,266	)
Other interest expense, net		(31,113	)		(14,301	)
Other expense, net		(1,500	)		(223	)
Total other expense		(53,423	)		(20,790	)
Income before income taxes		5,176			128,335
Income tax expense		(273	)		(21,036	)
Net income		4,903			107,299
Less: net income attributable to non-controlling interests		(1,734	)		(62,569	)
Net income attributable to Camping World Holdings, Inc.	$	3,169		$	44,730

Earnings per share of Class A common stock:
Basic	$	0.07		$	1.03
Diluted	$	0.05		$	1.02
Weighted average shares of Class A common stock outstanding:
Basic		44,455			43,553
Diluted		84,717			44,215


Camping World Holdings, Inc. and Subsidiaries
Supplemental Data

	Three Months Ended March 31,						Increase				Percent
	2023			2022			(decrease)				Change
Unit sales
New vehicles		13,912			19,020			(5,108	)			(26.9	%)
Used vehicles		12,432			10,976			1,456				13.3	%
Total		26,344			29,996			(3,652	)			(12.2	%)

Average selling price
New vehicles	$	46,489		$	43,899		$	2,590				5.9	%
Used vehicles	$	35,774		$	36,719		$	(945	)			(2.6	%)

Same store unit sales⁽¹⁾
New vehicles		13,080			18,838			(5,758	)			(30.6	%)
Used vehicles		11,689			10,920			769				7.0	%
Total		24,769			29,758			(4,989	)			(16.8	%)

Same store revenue⁽¹⁾ ($ in 000s)
New vehicles	$	608,041		$	827,676		$	(219,635	)			(26.5	%)
Used vehicles		417,988			400,902			17,086				4.3	%
Products, service and other		150,476			158,652			(8,176	)			(5.2	%)
Finance and insurance, net		121,893			152,275			(30,382	)			(20.0	%)
Total	$	1,298,398		$	1,539,505		$	(241,107	)			(15.7	%)

Average gross profit per unit
New vehicles	$	6,412		$	10,020		$	(3,608	)			(36.0	%)
Used vehicles		8,269			9,130		$	(861	)			(9.4	%)
Finance and insurance, net per vehicle unit		4,926			5,113		$	(187	)			(3.7	%)
Total vehicle front-end yield⁽²⁾		12,215			14,808		$	(2,593	)			(17.5	%)

Gross margin
Good Sam Services and Plans		65.2	%		62.5	%		265		bps
New vehicles		13.8	%		22.8	%		(903	)	bps
Used vehicles		23.1	%		24.9	%		(175	)	bps
Products, service and other		37.9	%		36.7	%		121		bps
Finance and insurance, net		100.0	%		100.0	%		0		bps
Good Sam Club		89.6	%		81.4	%		821		bps
Subtotal RV and Outdoor Retail		28.5	%		32.9	%		(439	)	bps
Total gross margin		29.7	%		33.7	%		(404	)	bps

RV and Outdoor Retail Inventories ($ in 000s)
New vehicles	$	1,219,889		$	1,420,136		$	(200,247	)			(14.1	%)
Used vehicles		510,689			423,409			87,280				20.6	%
Products, parts, accessories and misc.		248,998			308,855			(59,857	)			(19.4	%)
Total RV and Outdoor Retail inventories	$	1,979,576		$	2,152,400		$	(172,824	)			(8.0	%)

Vehicle inventory per location ($ in 000s)
New vehicle inventory per dealer location	$	6,489		$	7,934		$	(1,445	)			(18.2	%)
Used vehicle inventory per dealer location	$	2,716		$	2,365		$	351				14.8	%

Vehicle inventory turnover⁽³⁾
New vehicle inventory turnover		1.9			2.5			(0.6	)			(22.1	%)
Used vehicle inventory turnover		3.3			3.4			(0.1	)			(2.1	%)

Retail locations
RV dealerships		188			179			9				5.0	%
RV service & retail centers		6			10			(4	)			(40.0	%)
Subtotal		194			189			5				2.6	%
Other retail stores		1			1			—				0.0	%
Total		195			190			5				2.6	%

Other data
Active Customers⁽⁴⁾		5,291,750			5,464,510			(172,760	)			(3.2	%)
Good Sam Club members		2,025,438			2,101,399			(75,961	)			(3.6	%)
Service bays ⁽⁵⁾		2,682			2,538			144				5.7	%
Finance and insurance gross profit as a % of total vehicle revenue		11.9	%		12.4	%		(50	)	bps		n/a
Same store locations		179			n/a			n/a				n/a

⁽¹⁾	Our same store revenue and units calculations for a given period include only those stores that were open both at the end of the corresponding period and at the beginning of the preceding fiscal year.
⁽²⁾	Front end yield is calculated as gross profit from new vehicles, used vehicles and finance and insurance (net), divided by combined new and used vehicle unit sales.
⁽³⁾	Inventory turnover calculated as vehicle costs applicable to revenue over the last twelve months divided by the average quarterly ending vehicle inventory over the last twelve months.
⁽⁴⁾	An Active Customer is a customer who has transacted with us in any of the eight most recently completed fiscal quarters prior to the date of measurement.
⁽⁵⁾	A service bay is a fully-constructed bay dedicated to service, installation, and/or collision offerings.


Camping World Holdings, Inc. and Subsidiaries
Consolidated Balance Sheets (unaudited)
(In Thousands Except Per Share Amounts)

	March 31,			December 31,			March 31,
	2023			2022			2022
Assets
Current assets:
Cash and cash equivalents	$	72,828		$	130,131		$	139,480
Contracts in transit		104,148			50,349			135,513
Accounts receivable, net		109,105			112,411			116,593
Inventories		1,980,106			2,123,858			2,152,400
Prepaid expenses and other assets		58,761			66,913			57,763
Assets held for sale		13,971			—			—
Total current assets		2,338,919			2,483,662			2,601,749

Property and equipment, net		751,287			758,281			636,500
Operating lease assets		729,958			742,306			748,893
Deferred tax assets, net		145,413			143,226			185,616
Intangible assets, net		15,381			20,945			21,450
Goodwill		622,545			622,423			506,954
Other assets		27,010			29,304			26,373
Total assets	$	4,630,513		$	4,800,147		$	4,727,535
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	185,652		$	127,691		$	221,990
Accrued liabilities		172,428			147,833			224,995
Deferred revenues		94,166			95,695			92,747
Current portion of operating lease liabilities		61,421			61,745			63,490
Current portion of finance lease liabilities		5,590			10,244			10,393
Current portion of Tax Receivable Agreement liability		10,935			10,873			11,322
Current portion of long-term debt		26,969			25,229			15,825
Notes payable – floor plan, net		1,042,099			1,319,941			1,237,208
Other current liabilities		77,924			73,076			78,369
Liabilities related to assets held for sale		7,650			—			—
Total current liabilities		1,684,834			1,872,327			1,956,339

Operating lease liabilities, net of current portion		753,451			764,835			770,778
Finance lease liabilities, net of current portion		100,701			94,216			72,192
Tax Receivable Agreement liability, net of current portion		165,054			159,743			171,476
Revolving line of credit		20,885			20,885			20,885
Long-term debt, net of current portion		1,525,304			1,484,416			1,374,592
Deferred revenues		68,690			70,247			69,902
Other long-term liabilities		85,841			85,792			81,201
Total liabilities		4,404,760			4,552,461			4,517,365
Commitments and contingencies
Stockholders’ equity:
Preferred stock, par value $0.01 per share – 20,000 shares authorized; none issued and outstanding		—			—			—
Class A common stock, par value $0.01 per share – 250,000 shares authorized; 49,571, 47,571, and 47,855 shares issued, respectively; 44,467, 42,441, and 41,688 shares outstanding, respectively		496			476			476
Class B common stock, par value $0.0001 per share – 75,000 shares authorized; 39,466, 41,466, and 69,066 shares issued, respectively; 39,466, 41,466, and 41,466 shares outstanding, respectively		4			4			4
Class C common stock, par value $0.0001 per share – 0.001 share authorized, issued and outstanding		—			—			—
Additional paid-in capital		114,017			106,051			126,071
Treasury stock, at cost; 5,104, 5,130, and 5,883 shares, respectively		(178,832	)		(179,732	)		(206,098	)
Retained earnings		196,409			221,031			207,774
Total stockholders’ equity attributable to Camping World Holdings, Inc.		132,094			147,830			128,227
Non-controlling interests		93,659			99,856			81,943
Total stockholders’ equity		225,753			247,686			210,170
Total liabilities and stockholders’ equity	$	4,630,513		$	4,800,147		$	4,727,535


Camping World Holdings, Inc. and Subsidiaries
Summary of Consolidated Statements of Cash Flows (unaudited)
(In Thousands)

	Three Months Ended March 31,
	2023			2022

Net cash provided by (used in) operating activities	$	199,217		$	(210,054	)

Investing activities
Purchases of property and equipment		(25,314	)		(31,665	)
Proceeds from sale of property and equipment		183			199
Purchases of real property		(18,236	)		(17,018	)
Proceeds from the sale of real property		22,703			—
Purchases of businesses, net of cash acquired		—			(34,808	)
Purchases of intangible assets		(23	)		(715	)
Net cash used in investing activities		(20,687	)		(84,007	)

Financing activities
Proceeds from long-term debt		59,227			—
Payments on long-term debt		(9,058	)		(3,954	)
Net (payments) proceeds on notes payable – floor plan, net		(249,822	)		275,296
Payments on finance leases		(1,233	)		(1,021	)
Proceeds from sale-leaseback arrangement		—			27,951
Payments on sale-leaseback arrangement		(46	)		(36	)
Payment of debt issuance costs		(767	)		—
Dividends on Class A common stock		(27,791	)		(26,427	)
Proceeds from exercise of stock options		41			231
RSU shares withheld for tax		(338	)		(1,238	)
Repurchases of Class A common stock to treasury stock		—			(79,757	)
Distributions to holders of LLC common units		(6,046	)		(24,836	)
Net cash (used in) provided by financing activities		(235,833	)		166,209

Decrease in cash and cash equivalents		(57,303	)		(127,852	)
Cash and cash equivalents at beginning of the period		130,131			267,332
Cash and cash equivalents at end of the period	$	72,828		$	139,480