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Share Name | Share Symbol | Market | Type |
---|---|---|---|
RumbleOn Inc | NASDAQ:RMBL | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-0.10 | -2.58% | 3.78 | 3.50 | 4.98 | 3.91 | 3.62 | 3.91 | 251,988 | 21:30:00 |
Paid Down $47 Million of Term Debt
Reiterates 2023 Outlook
RumbleOn, Inc. (NASDAQ: RMBL) (the “Company” or “RumbleOn”), the largest powersports retailer in North America, today announced operational and financial results for the three months ended September 30, 2023. RumbleOn management is hosting an earnings call to discuss the Company’s results today, November 7, 2023, at 7:00 am CT (8:00 am ET).
Third Quarter 2023 Financial and Operational Highlights
Management Commentary
Mike Kennedy, RumbleOn's Chief Executive Officer, stated, “I am thrilled to join RumbleOn at such an exciting time in the transformation journey. I look forward to bringing my extensive industry experience to guide the company in its next chapter. During the quarter, the team made significant progress towards strengthening our balance sheet and cutting costs, positioning the company for future growth and success."
Mr. Kennedy continued, “Looking ahead, the entire leadership team and the Board are laser focused on driving growth and profitability as well as a disciplined capital allocation plan to effectively deliver value for our shareholders.”
Third Quarter 2023 — Summary Financial Results
Reconciliation of GAAP to non-GAAP financial measures are provided in accompanying financial schedules.
Unless otherwise noted, all comparisons in the narrative are on a sequential basis for the three months ended September 30, 2023, as compared to the three months ended June 30, 2023. The following table provides operating highlights related to continuing operations.
(Unaudited)
$ in millions except per share amounts
Three Months Ended
Change
Sep 30, 2023
Jun 30, 2023
Sep 30, 2022
Sequential
Year-over-Year
Total Unit Sales (#)
17,573
20,277
18,393
(13.3)%
(4.5)%
Total Revenue
$338.1
$382.7
$380.7
(11.7)%
(11.2)%
Gross Profit
$91.9
$106.4
$114.4
(13.6)%
(19.7)%
Gross Profit Margin
27.2%
27.8%
30.0%
(60) bps
(280) bps
Income (loss) from continuing operations
$(16.5)
$(12.8)
$3.7
28.9%
nm
Diluted Earnings (Loss) per Share from Continuing Operations
$(0.99)
$(0.78)
$0.23
26.9%
nm
Adjusted EBITDA
$13.2
$23.6
$26.1
(44.2)%
(49.4)%
Adjusted Net Income (Loss)
$(11.9)
$0.3
$5.3
nm
nm
Adjusted Diluted Earnings (Loss) per Share
$(0.71)
$0.02
$0.33
nm
nm
nm = not meaningful
Total Unit Sales 17,573 units decreased 13.3%, driven by typical seasonality in the powersports business.
Total Revenue of $338.1 million decreased 11.7%.
Total Gross Profit of $91.9 million decreased 13.6% and Gross Profit Margin was 27.2%, down from 27.8%. Sequential decrease in gross profit margin was in line with our prior expectations.
Operating Expenses were $92.2 million, or 27.3% of revenue, compared to $105.6 million, or 27.6% of revenue. Total stock-based compensation was $3.1 million compared to $4.9 million in the prior quarter.
Loss from Continuing Operations was $16.5 million, or 4.9% of revenue, compared to $12.8 million, or 3.4% of revenue. Loss per diluted share was $0.99 compared to $0.78.
Adjusted Net Income (Loss) was $(11.9) million, or (3.5)% of revenue, compared to $0.3 million or 0.1% of revenue. Adjusted net income (loss) per diluted share was $(0.71) compared to $0.02.
Adjusted EBITDA was $13.2 million, compared to $23.6 million. The 44.2% sequential decrease in Adjusted EBITDA was driven by the impact of lower unit sales as expected due to the seasonality in the Powersports segment partially offset by the effects of recently implemented cost reductions.
Cash and Restricted Cash as of September 30, 2023 was approximately $59.5 million, and total debt was $369.9 million.
Total Available Liquidity, defined as unrestricted cash plus availability under floor plan credit facilities for inventory on hand at September 30, 2023, totaled approximately $73.6 million.
Cash Flow used in Operating Activities was $19.3 million for the nine months ended September 30, 2023.
Weighted Average Basic and Diluted Shares of Class A and Class B common stock outstanding were 16,665,709 and 16,452,254 for the three months and nine months ended September 30, 2023, respectively. As of September 30, 2023, RumbleOn had 16,735,391 total shares of Class B common stock and 50,000 shares of Class A common stock outstanding.
Full Year 2023/2024 — Financial Outlook
RumbleOn is reaffirming its outlook for the full year 2023 and full year 2024:
The full year 2023 Outlook is as follows:
Third Quarter 2023 — Segment Results
Unless otherwise noted, all comparisons are on a sequential basis for the three months ended September 30, 2023, as compared to the three months ended June 30, 2023.
Powersports Segment
(Unaudited)
$ in millions except per unit
Three Months Ended
Change
Sep 30, 2023
Jun 30, 2023
Sep 30, 2022
Sequential
Year-over-Year
Unit Sales (#)
New
10,851
13,126
9,973
(17.3)%
8.8%
Used
6,722
7,151
8,420
(6.0)%
(20.2)%
Total Powersports Unit Sales
17,573
20,277
18,393
(13.3)%
(4.5)%
Revenue
New
$ 159.6
$ 185.6
$ 165.4
(14.0)%
(3.5)%
Used
75.6
84.1
106.5
(10.1)%
(29.0)%
Finance & Insurance, net
29.3
33.2
31.6
(11.7)%
(7.3)%
Parts, Services, and Accessories
59.7
65.4
62.2
(8.7)%
(4.0)%
Total Powersports Revenue
$ 324.2
$ 368.3
$ 365.7
(12.0)%
(11.3)%
Gross Profit
New
$ 22.1
$ 28.6
$ 32.1
(22.7)%
(31.2)%
Used
10.3
10.9
18.0
(5.5)%
(42.8)%
Finance & Insurance, net
29.3
33.2
31.6
(11.7)%
(7.3)%
Parts, Services, and Accessories
27.0
30.4
29.1
(11.2)%
(7.2)%
Total Powersports Gross Profit
$ 88.7
$ 103.1
$ 110.8
(14.0)%
(19.9)%
Powersports GPU1
$ 5,380
$ 5,349
$ 6,343
0.6%
(15.2)%
1 Calculated as total powersports gross profit divided by new and used retail powersports units sold.
Used Powersports Units, which includes used retail and wholesale Powersports Units, decreased (6.0)% sequentially, primarily due to expected seasonality.
Used Powersports Revenue decreased (10.1)% sequentially due to anticipated seasonality.
Used Powersports Gross Profit decreased (5.5)% sequentially due primarily to the expected decrease in units, partially offset by a small increase in Used GPU.
New Powersports Revenue decreased (14.0)% sequentially, as the result of a (17.3)% reduction in unit sales, driven by normal reduction in consumer demand from Q2 to Q3.
New Powersports Gross Profit decreased (22.7)% sequentially due primarily to the decrease in new unit sales and changes in mix.
Powersports GPU was $5,380, increased 0.6% sequentially.1
Vehicle Logistics Segment
(Unaudited)
$ in millions
Three-Months Ended
Change
Sep 30, 2023
Jun 30, 2023
Sep 30, 2022
Sequential
Year-over-Year
Vehicles Transported (#)
22,930
20,990
23,105
9.2%
(0.8)%
Vehicle Logistics Revenue
$14.0
$14.4
$15.0
(2.8)%
(6.7)%
Vehicle Logistics Gross Profit
$3.3
$3.4
$3.5
(2.9)%
(5.7)%
Revenue from the Vehicle Logistics Segment decreased 2.8% sequentially, despite a 9.2% increase in the number of vehicles transported, due to a decrease in revenue per vehicle transported to $609 in the third quarter.
Gross profit for this segment was down sequentially, driven by lower revenue per vehicle transported.
Conference Call Details
RumbleOn's management will host a conference call to discuss its operational and financial results on November 7, 2023 at 7:00 a.m. Central Time (8:00 a.m. Eastern Time). A live and archived webcast can be accessed from RumbleOn's Investor Relations website. To access the conference call telephonically, callers may dial 1-877-407-9751 (or 1-201-689-8453 for callers outside of the United States) and enter conference ID 13742467.
About RumbleOn
RumbleOn is the largest powersports retailer in North America, offering a wide selection of new and used motorcycles, all-terrain vehicles, utility terrain vehicles, personal watercraft, and other powersports products, including parts, apparel, accessories, and aftermarket products from a wide range of manufacturers. As of September 2023, we operate over 55 retail locations, each equipped with full service departments, as well as 5 regional fulfillment centers. Our retail locations are run by our highly-trained and knowledgeable team and are primarily located in the Sun Belt of the United States. To learn more please visit us online at https://www.rumbleon.com/.
Cautionary Note on Forward-Looking Statements
This press release may contain "forward-looking statements" as that term is defined under the Private Securities Litigation Reform Act of 1995 (PSLRA), which statements may be identified by words such as "expects," "projects," "will," "may," "anticipates," "believes," "should," "intends," "estimates," and other words of similar meaning. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release and are advised to consider the factors listed under the heading "Forward-Looking Statements" and "Risk Factors" in the Company's SEC filings, as may be updated and amended from time to time. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Use of Non-GAAP Financial Measures
As required by the rules of the Securities and Exchange Commission ("SEC"), we provide reconciliations of the non-GAAP financial measures contained in this press release to the most directly comparable measure under GAAP, which are set forth in the financial tables attached to this release.
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income (loss), and Adjusted net income (loss) margin are non-GAAP financial measures and should not be considered as alternatives to operating income or net income as a measure of operating performance or cash flows or as a measure of liquidity. Non-GAAP financial measures are not necessarily calculated the same way by different companies and should not be considered a substitute for or superior to U.S. GAAP.
Adjusted EBITDA is defined as net income (loss) adjusted to add back interest expense, depreciation and amortization, changes in derivative liability, non-cash stock-based compensation costs, transaction costs, litigation expenses, and other non-recurring costs, as these recoveries, charges and expenses are not considered a part of our core business operations and are not necessarily an indicator of ongoing, future company performance.
Adjusted EBITDA is one of the primary metrics used by management to evaluate the financial performance of our business. We present adjusted EBITDA because we believe it is frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Further, we believe it is helpful in highlighting trends in our operating results, because it excludes, among other things, certain results of decisions that are outside the control of management, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure and capital investments.
Adjusted net income (loss) is defined as net income (loss) adjusted to add back transaction costs, purchase accounting adjustments and other non-recurring costs which include items not indicative of our ongoing operating performance.
With respect to our 2023 adjusted EBITDA target, a reconciliation of this non-GAAP measure to the corresponding GAAP measure is not available without unreasonable effort due to the complexity of the reconciling items that we exclude from this non-GAAP measure.
RumbleOn, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(Dollars in thousands; except per share amounts)
September 30, 2023
December 31, 2022
ASSETS
Current assets:
Cash
$
41,406
$
46,762
Restricted cash
18,046
10,000
Accounts receivable, net
33,679
28,040
Inventory
358,654
323,473
Prepaid expense and other current assets
5,654
7,422
Assets held for sale
21,555
33,662
Current assets of discontinued operations
—
11,377
Total current assets
478,994
460,736
Property and equipment, net
78,608
76,078
Right-of-use assets
167,236
161,822
Goodwill
23,897
21,142
Intangible assets, net
240,457
247,413
Deferred tax assets
68,251
58,115
Assets of discontinued operations
35
23
Other assets
1,574
1,881
Total assets
$
1,059,052
$
1,027,210
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and other current liabilities
$
81,830
$
79,439
Vehicle floor plan note payable
287,135
220,176
Current portion of long-term debt and line of credit
14,893
3,645
Current liabilities of discontinued operations
513
8,434
Total current liabilities
384,371
311,694
Long-term liabilities:
Senior secured debt
271,671
317,494
Convertible debt, net
34,196
31,890
Line of credit and notes payable
49,174
25,000
Operating lease liabilities
135,726
126,695
Other long-term liabilities
8,783
8,422
Total long-term liabilities
499,550
509,501
Total liabilities
883,921
821,195
Commitments and contingencies
Stockholders’ equity:
Class A Common Stock, $0.001 par value, 50,000 shares authorized, 50,000 shares issued and outstanding as of September 30, 2023 and December 31, 2022
—
—
Class B Common Stock, $0.001 par value, 100,000,000 shares authorized, 16,735,391 and 16,184,264 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively
17
16
Additional paid-in capital
602,026
585,937
Accumulated deficit
(422,593
)
(375,619
)
Treasury stock, at cost
(4,319
)
(4,319
)
Total stockholders’ equity
175,131
206,015
Total liabilities and stockholders’ equity
$
1,059,052
$
1,027,210
RumbleOn, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
2023
2022
Revenue:
Powersports vehicles
$
235,132
$
271,877
$
738,136
$
806,382
Parts, service and accessories
59,727
62,216
184,205
182,268
Finance and insurance, net
29,288
31,569
89,658
95,830
Vehicle logistics
13,964
15,002
43,227
42,870
Total revenue
338,111
380,664
1,055,226
1,127,350
Cost of revenue:
Powersports
202,788
221,631
634,091
647,891
Parts, service and accessories
32,754
33,074
99,542
96,473
Vehicle logistics
10,624
11,516
32,946
33,732
Total cost of revenue
246,166
266,221
766,579
778,096
Gross profit
91,945
114,443
288,647
349,254
Selling, general and administrative
84,957
93,822
271,557
264,428
Depreciation and amortization
7,275
6,554
17,271
16,872
Operating income
(287
)
14,067
(181
)
67,954
Other income (expense):
Interest expense
(19,828
)
(12,209
)
(55,756
)
(35,622
)
Other income
75
26
208
230
PPP Loan forgiveness
—
2,509
—
2,509
Change in derivative liability
—
—
—
39
Total other expense
(19,753
)
(9,674
)
(55,548
)
(32,844
)
Income (loss) from continuing operations before income taxes
(20,040
)
4,393
(55,729
)
35,110
Income taxes provision (benefit) from continuing operations
(3,556
)
678
(9,706
)
8,166
Income (loss) from continuing operations, net
(16,484
)
3,715
(46,023
)
26,944
Income (loss) from operations of discontinued operations
—
(858
)
(1,100
)
(1,151
)
Income tax provision (benefit) from discontinued operations
—
(182
)
(149
)
(420
)
Income (loss) from discontinued operations, net
—
(676
)
(951
)
(731
)
Net income (loss)
$
(16,484
)
$
3,039
$
(46,974
)
$
26,213
Weighted average number of common shares outstanding - basic
16,665,709
16,020,296
16,452,254
15,859,134
Earnings (loss) per share - basic from continuing operations
$
(0.99
)
$
0.23
$
(2.80
)
$
1.70
Earnings (loss) per share - basic from discontinued operations
$
—
$
(0.04
)
$
(0.06
)
$
(0.05
)
Weighted average number of common shares outstanding - fully diluted
16,665,709
16,067,395
16,452,254
15,922,484
Earnings (loss) per share - diluted from continuing operations
$
(0.99
)
$
0.23
$
(2.80
)
$
1.69
Earnings (loss) per share - diluted from discontinued operations
$
—
$
(0.04
)
$
(0.06
)
$
(0.05
)
RumbleOn, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(Dollars in thousands)
Nine Months Ended September 30,
2023
2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)
$
(46,974
)
$
26,213
Loss from discontinued operations
(951
)
(731
)
Net income (loss) from continuing operations
$
(46,023
)
$
26,944
Adjustments to reconcile net income (loss) from continuing operations to net cash provided by (used in) operating activities:
Depreciation and amortization
17,271
16,872
Amortization of debt discount and issuance costs
7,324
3,936
Stock-based compensation expense
10,898
7,237
Forgiveness of PPP loan
—
(2,509
)
Gain from change in value of derivatives
—
(39
)
Deferred taxes
(10,136
)
3,946
Originations of loan receivables, net of principal payments received
5,006
(23,676
)
Valuation allowance charge for loan receivable assets held for sale
5,971
—
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable
(5,639
)
1,239
Inventory
(29,983
)
(93,133
)
Prepaid expenses and other current assets
1,779
(494
)
Other assets
177
(3,766
)
Other liabilities
1,461
(2,813
)
Accounts payable and accrued liabilities
3,729
(2,131
)
Floor plan trade note borrowings
18,840
38,746
Net cash provided by (used in) operating activities of continuing operations
(19,325
)
(29,641
)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions, net of cash received
(3,300
)
(65,976
)
Purchase of property and equipment
(7,803
)
(4,334
)
Technology development
(1,758
)
(6,188
)
Net cash used in investing activities of continuing operations
(12,861
)
(76,498
)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from new secured debt
—
84,500
Proceeds from sale leaseback transaction
49,718
—
Proceeds from ROF credit facility for the purchase of consumer finance loans
—
22,925
Repayment of debt and line of credit
(59,048
)
(34,082
)
Repayment of notes payable
—
(2,116
)
Net borrowings from non-trade floor financing plans
45,993
34,067
Debt issuance costs
(1,787
)
—
Net cash provided by financing activities of continuing operations
34,876
105,294
CASH FLOWS FROM DISCONTINUED OPERATIONS
Net cash provided by operating activities
3,438
11,372
Net cash used in financing activities
(5,254
)
(13,286
)
Net cash used in discontinued operations
(1,816
)
(1,914
)
NET INCREASE (DECREASE) IN CASH
874
(2,759
)
Cash and restricted cash at beginning of period, including discontinued operations
58,578
51,974
Cash and restricted cash at end of period, including discontinued operations
$
59,452
$
49,215
RumbleOn, Inc.
Reconciliation of Net Income (Loss) to Adjusted EBITDA
(Unaudited)
(Dollars in thousands)
Three Months Ended September 30,
Nine Months Ended September 30,
2023
2022
2023
2022
Net income (loss)
$
(16,484
)
$
3,039
$
(46,974
)
$
26,213
Income (loss) from discontinued operations, net
—
(676
)
(951
)
(731
)
Income (loss) from continuing operations, net
$
(16,484
)
$
3,715
$
(46,023
)
$
26,944
Add back:
Interest expense
19,828
12,209
55,756
35,622
Depreciation and amortization
7,275
6,554
17,271
16,872
Income tax provision (benefit)
(3,556
)
678
(9,706
)
8,165
EBITDA
7,063
23,156
17,298
87,603
Adjustments:
Change in derivative liability
—
—
—
(39
)
Charges related to proxy contest and Board of Directors reorganization
324
—
5,053
—
Lease expense associated with favorable related party leases in excess of contractual lease payments
271
177
813
706
Litigation settlement expenses
9
—
88
—
Loss associated with RumbleOn Finance loan receivables
600
—
5,971
—
Other non-recurring costs
64
2,588
952
6,514
Personnel restructuring costs
1,768
—
6,493
—
Purchase accounting related
—
—
—
63
PPP Loan forgiveness
—
(2,509
)
—
(2,509
)
Transaction costs
—
100
34
1,503
Stock based compensation
3,077
2,605
10,898
7,237
Adjusted EBITDA
$
13,176
$
26,117
$
47,600
$
101,078
For the three and nine months ended September 30, 2023 and 2022, adjustments to Adjusted EBITDA are primarily comprised of:
RumbleOn, Inc.
Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) and
Earnings (Loss) per share to Adjusted Earnings (Loss) per share
(Unaudited)
(Dollars in thousands, except per share amounts)
Three Months Ended
September 30,
Nine Months Ended September 30,
2023
2022
2023
2022
Net income (loss)
$
(16,484
)
$
3,039
$
(46,974
)
$
26,213
Income (loss) from discontinued operations, net
—
(676
)
(951
)
(731
)
Income (loss) from continuing operations, net
$
(16,484
)
$
3,715
$
(46,023
)
$
26,944
Adjustments:
Charges related to proxy contest and Board of Directors reorganization
324
—
5,053
—
Lease expense associated with favorable related party leases in excess of contractual lease payments
271
177
813
706
Litigation settlement expenses
9
—
88
—
Loss associated with sale of RumbleOn Finance loan receivables
600
—
5,971
—
Other non-recurring costs
1,252
2,625
2,140
6,796
PPP Loan forgiveness
—
(2,509
)
—
(2,509
)
Purchase accounting related
2,572
2,456
8,560
6,359
Personnel restructuring costs
580
—
5,305
—
Transaction costs
—
100
34
1,503
Income tax expense
(993
)
(1,311
)
(4,754
)
(4,269
)
Adjusted Net Income (Loss)
$
(11,869
)
$
5,253
$
(22,813
)
$
35,530
Weighted average number of common shares outstanding - basic
16,665,709
16,020,296
16,452,254
15,859,134
Earnings (loss) per share - basic from continuing operations
$
(0.99
)
$
0.23
$
(2.80
)
$
1.70
Adjusted earnings (loss) per share - basic
$
(0.71
)
$
0.33
$
(1.39
)
$
2.24
Weighted average number of common shares outstanding - diluted
16,665,709
16,067,395
16,452,254
15,922,484
Earnings (loss) per share - diluted from continuing operations
$
(0.99
)
$
0.23
$
(2.80
)
$
1.69
Adjusted earnings (loss) per share - diluted
$
(0.71
)
$
0.33
$
(1.39
)
$
2.23
For the three and nine months ended September 30, 2023 and 2022, adjustments to net income (loss) are primarily comprised of:
View source version on businesswire.com: https://www.businesswire.com/news/home/20231107466597/en/
Investor Relations: Will Newell investors@rumbleon.com
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