Earnings Review and Free Research Report: Camping World’s Revenue Surged 20.1%; Adjusted EPS Soared 38.5%
Research Desk Line-up: Digital Realty Trust Post Earnings Coverage
LONDON, UK / ACCESSWIRE / August 23, 2017 /Pro-Trader Daily has just published a free post-earnings coverage on Camping World Holdings, Inc. (NYSE: CWH), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=CWH, following the Company's announcement of its second quarter fiscal 2017 operating results on August 10, 2017. The recreational vehicle retailer and services provider outperformed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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For the second quarter, fiscal 2017, Camping World's total revenue surged 20.1% to $1.3 billion compared to revenue of $1.1 billion in Q2 2016. The Company's revenue numbers surpassed Wall Street's expectations of $1.16 billion.
Camping World's same store sales of the 115 retail locations that were opened both at the beginning of the preceding fiscal year and at the end of Q2 2017 had increased 10.6% to $1.1 billion. The increase in same store sales at retail locations was primarily driven by the increased volume of new towable units sold.
During Q2 2017, Camping World's gross profit increased 24.5% to $372.8 million and gross margin increased 102 basis points to 29.1%. The Company's total operating expenses increased 20.4% on y-o-y basis to $236.1 million in the reported quarter. Camping World's selling, general and administrative ("SG&A") expenses increased 20.0% to $228.4 million from $190.3 million in Q2 2016.
For Q2 2017, Camping World's net income increased 26.3% to $105.3 million and adjusted pro-forma net income surged 41.6% to $77.7 million from $54.9 million in Q2 2016. The Company adjusted pro-forma earnings per diluted share increased 38.5% to $0.91 from $0.65 in the year ago same period. Camping World's earnings exceeded analysts' estimates of $0.69 per share.
Camping World's adjusted EBITDA rose 36.0% to $142.1 million from $104.5 million in Q2 2016 and adjusted EBITDA margin increased 130 basis points to 11.1% from 9.8% in the prior year's corresponding quarter.
Camping World's Segment Results
During Q2 2017, Consumer Services and Plans segment's revenue increased 5.9% to $48.1 million from $45.4 million in Q2 2016, primarily driven by increases in vehicle insurance and Good Sam Travel Assist programs primarily due to increased policies in force, roadside assistance contracts, and other increases. The segment's gross profit increased 5.2% to $27.5 million and gross margin decreased 40 basis points to 57.3% of segment revenue on a y-o-y basis. The decrease in Consumer Services and Plans' gross margin was primarily due to reduced gross margin from consumer magazines.
Retail revenue increased 20.7% to $1.2 billion from $1.0 billion in Q2 2016. Within the Retail segment during the reported quarter, new vehicle revenue increased 31.9% to $762.9 million; used vehicle revenue decreased 9.2% to $196.5 million; parts, services, and other revenue increased 10.4% to $174.2 million; and finance and insurance revenue increased 44.5% to $101.0 million. Finance and insurance's net revenue as a percentage of total new and used vehicle revenue increased to 10.5% from 8.8% in Q2 2016, and benefited from a sales mix shift toward lower-priced new towable units and better integration of the finance and insurance selling process.
Retail segment's gross profit increased 26.3% to $345.3 million and gross margin increased 124 basis points to 28.0% of the segment's revenue on a y-o-y basis. The growth in Retail's gross margin was driven primarily by a 173 basis point increase in the finance and insurance penetration rate and a 593 basis point increase in gross margin from used vehicle unit sales.
Camping World operated a total of 137 retail locations and two Overton's retail locations as of June 30, 2017, compared to 120 retail locations at June 30, 2016. In Q2 2017, the Company added ten RV-centric locations from completed acquisitions, one RV-centric location from a greenfield opening, and two Overton's retail locations.
Select Balance Sheet and Cash Flow Items
Camping World's working capital and cash and cash equivalents balance at June 30, 2017, were $393.6 million and $252.2 million, respectively, compared to $266.8 million and $114.2 million, respectively, at December 31, 2016.
During the quarter ended June 30, 2017, the Company received proceeds, net of underwriter discounts and commissions, of $122.5 million from the sale of 4.6 million Class A shares in a public offering.
At the end of the reported quarter, Camping World had $3.2 million of borrowings under its $35 million revolving credit facility; $736.3 million of term loan principal outstanding under its senior secured credit facilities; and $780.9 million of floor plan notes payable outstanding under its floor plan financing facility.
The Company's inventory at the end of Q2 2017 increased 10.6% to $1.11 billion compared to $909.3 million at December 31, 2016.
On Tuesday, August 22, 2017, the stock closed the trading session at $34.91, marginally up 0.84% from its previous closing price of $34.62. A total volume of 443.10 thousand shares have exchanged hands. Camping World's stock price rallied 12.07% in the last one month, 26.43% in the past three months, and 2.76% in the previous six months. Furthermore, since the start of the year, shares of the Company have gained 7.62%. The stock is trading at a PE ratio of 16.65 and has a dividend yield of 0.92%. The stock currently has a market cap of $3.00 billion.
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