Camping World Holdings, Inc. reported that first-quarter revenue decreased 10.6 percent to $1.5 billion. Net income fell 95.4 percent to $4.9 million, or 5 cents per diluted share of Class A common stock, versus net income of $107.3 million, or $1.02 per diluted share in the year-ago period.
New vehicle revenue was $646.8 million for the quarter, a decline of 22.5 percent, and new vehicle unit sales were 13,912 units, a decrease 26.9 percent.
Used vehicle revenue was a record $444.7 million for the first quarter, an increase of 10.4 percent, and used vehicle unit sales were a record 12,432 units, an increase of 13.3 percent. Same-store used vehicle unit sales increased 7.0 percent for the first quarter, and same-store new vehicle unit sales decreased 30.6 percent.
Products, service and other revenue was $207.7 million for the first quarter, a decline of 3.4 percent. Growth in service and parts revenues partly offset larger declines in direct-to-manufacturer RV furniture revenues.
Gross margin was 29.7 percent of sales, a decrease of 404 basis points from the year-ago quarter. The decrease in gross margin was said to be 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.
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.”
Floor plan interest expense was $20.8 million, an increase of $232.1 percent, primarily as a result of the rise in interest rates. Other interest expense, net was $31.1 million, an increase of 117.6 percent, primarily as a result of the rise in interest rates and a higher average principal balance.
The sharp decrease in net income was said to be 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.
Adjusted diluted earnings per share of Class A common stock was 14 cents a share in Q1 2023 versus $1.15 in Q1 2022.
Adjusted EBITDA was $60.8 million, a decrease of 66.6 percent, 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.
Photo courtesy Camping World
