Camping World Holdings, Inc. Chairman and CEO Marcus Lemonis in a company release new vehicle same-store unit growth turned positive beginning in December 2023, and January and February to-date are trending up from mid-single-digit to low-double-digit growth.

“We achieved our goal of significantly improving our new unit inventory position, with less than 7,500 new model year 2023s remaining as of today,” Lemonis shared. “We believe we are outpacing the industry with close to 80 percent in 2024 models currently. We believe that successful negotiations in year-over-year pricing reductions on like-for-like new units has sparked early demand and new gross margin stabilization.”

Revenue was $1.1 billion in the fourth quarter, a decrease of 13.4 percent year-over-year (YoY) versus the 2022 fourth quarter.

  • Used vehicle revenue was $321.7 million for Q4, a decrease of 18.1 percent YoY, and used vehicle unit sales were 9,492 units, a decrease of 842 units, or 8.1 percent YoY.
  • New vehicle revenue was $449.4 million for Q4, a decline of 6.7 percent YoY, and new vehicle unit sales were 10,717 units, an increase of 328 units, or 3.2 percent YoY.
  • Average selling price of new and used vehicles declined 9.6 percent and 10.8 percent, respectively, for the fourth quarter.

As the procurement prices of model year 2024 new vehicles declined compared to model years 2022 and 2023, the company said it actively discounted certain used vehicles and certain pre-2024 model year new vehicles during the fourth quarter to reduce inventory levels of aged vehicles.

Same-store used vehicle unit sales decreased 11.2 percent for the fourth quarter, and same-store new vehicle unit sales decreased 2.2 percent.

“Any reduction of new model pricing causes us to reset used vehicle values and slow down the purchases of used RV inventory while market values correct themselves,” explained Matt Wagner, COO, Camping World Holdings, Inc. “We expect this short-term maneuver to allow used vehicle volumes to improve over time, with gross margin improvement beginning in the second quarter and continuing through the balance of the year.”

Products, services and other revenue was $179.0 million, a decline of 24.6 percent YoY, said to be driven largely by lower demand and lower stocking levels of lifestyle and activities, and design and home products, as well as discounting and discontinuation of certain product categories related to our Active Sports Restructuring.

Gross profit was $343.4 million, a decrease of 12.3 percent YoY. Total gross margin was 31.0 percent of net sales, an increase of 37 basis points. The decrease in gross profit was driven largely by the new and used vehicle discounting.

Selling, general and administrative (SG&A) expenses were $337.1 million, a decrease of 6.7 percent YoY, primarily as a result of our efforts to reduce expenses.

Floor plan interest expense was $21.8 million, an increase of 24.1 percent, and other interest expense, net was $35.4 million, an increase of 36.2 percent. These increases were said to be primarily due to the rise in interest rates.

The net loss for the fourth quarter was $49.9 million, a decrease of $7.3 million, or 12.7 percent YoY.

Diluted loss per share of Class A common stock was 49 cents a share in Q4 2023 versus diluted loss per share of Class A common stock of 79 cents in Q4 2022. Adjusted loss per share – diluted of Class A common stock was 47 cents in 2023 versus adjusted loss per share – diluted of Class A common stock of 20 cents in 2022.

Adjusted EBITDA was a negative $8.9 million, a decrease of $29.1 million, or 144.1 percent YoY.

Full Year-over-Year Operating Highlights

Revenue was $6.2 billion, a decrease of 10.6 percent YoY.

  • Used vehicle revenue was a record $2.0 billion, an increase of 5.4 percent YoY, and used vehicle unit sales were a record 56,823 units, an increase of 5,498 units, or 10.7 percent YoY.
  • New vehicle revenue was $2.6 billion, a decline of 20.2 percent YoY, and new vehicle unit sales were 58,731 units, a decrease of 11,698 units, or 16.6 percent YoY.
  • Average selling price of new and used vehicles declined 4.3 percent and 4.8 percent, respectively.
  • Same-store used vehicle unit sales increased 5.0 percent YoY, and same-store new vehicle unit sales decreased 22.1 percent YoY.

Products, services and other revenue was $870.0 million, a decline of 12.9 percent YoY. The decline was said to be driven largely by lower demand and lower stocking levels of lifestyle and activities, and design and home products, as well as decreases in the direct to manufacturer RV furniture revenues due to RV manufacturer production slowdowns and discounting and discontinuation of certain product categories related to the Active Sports Restructuring.

Gross profit was $1.9 billion, a decrease of 17.0 percent YoY.

Total gross margin was 30.2 percent of sales, a decrease of 230 basis points YoY. The decrease in gross profit and gross margin was reportedly driven largely by the decrease in average selling price of new and used vehicles and gross profit was further impacted by the decrease in combined RV unit sales and the related decrease in finance and insurance, net. This decrease was said to be partially offset by the $14.3 million increase in gross profit and 682 basis point increase in gross margin of the Good Sam Services and Plans segment.

SG&A expenses were $1.5 billion, a decrease of $68.0 million, or 4.2 percent, YoY, primarily due to approximately $49.2 million of reduced advertising expenses and $35.1 million of reduced variable compensation costs, partially offset by incremental costs related to the net six additional store locations added during the year ended December 31, 2023.

Floor plan interest expense was $83.1 million, an increase of 97.7 percent YoY, and other interest expense, net was $135.3 million, an increase of 78.6 percent YoY. These increases were primarily as a result of the rise in interest rates.

Net income was $50.6 million, a decrease of $300.4 million, or 85.6 percent YoY.

Diluted earnings per share of Class A common stock was 55 cents in 2023 versus diluted earnings per share of Class A common stock of $3.22 in 2022. Adjusted earnings per share – diluted of Class A common stock was 81 cents in 2023 versus adjusted earnings per share – diluted of Class A common stock of $4.17 in 2022.

Adjusted EBITDA was $286.2 million, a decrease of $367.2 million, or 56.2 percent YoY.

New and used vehicle inventories were $1.8 billion, a decrease of $32.1 million YoY at year-end.

The company paid an annualized cash dividend of $1.50 per share of Class A common stock, a decrease of $1.00 per share of Class A common stock.

Wagner concluded, “Positive demand trends, inventory discipline, strength in our Good Sam segment and the service and parts portion of our business, acquisitions, and cost reductions, give us confidence in delivering unit volume and strong earnings growth in 2024 while continuing our march to 320 locations by 2028.”

Image courtesy Camping World Holdings, Inc.