RumbleON Inc (RMBL, Financial), a leading online retailer for pre-owned motorcycles and other powersports vehicles, disclosed its financial outcomes for the first quarter of 2024 on May 8, 2024, through its 8-K filing. The company, known for its efficient and transparent consumer and dealer services in the powersports and automotive segments, reported a decrease in revenue but showcased operational improvements compared to the previous year.
Company Overview
RumbleON operates primarily through two segments: its Powersports dealership group and Wholesale Express, LLC, a vehicle logistics provider. The company is recognized as the largest powersports retail group in the U.S., offering an extensive range of new and pre-owned vehicles, including motorcycles, along with parts, accessories, and finance services.
Financial Performance Highlights
The first quarter saw RumbleON achieving an operating income of $5.2 million, a significant turnaround from the operating loss of $0.7 million reported in the same quarter last year. Despite this operational success, total revenue decreased by 8.0% to $307.8 million, falling short of the analyst estimates of $329.72 million. The decline was attributed to a lower unit volume and a decrease in average selling price, influenced by market mix adjustments.
Gross profit also saw a downturn, decreasing by 8.5% to $82.6 million, with the gross profit margin slightly down by 20 basis points to 26.8%. Adjusted EBITDA improved by 8.3%, reaching $11.7 million, reflecting tighter control over SG&A expenses which decreased by 14.4% to $73.9 million.
Segment Performance and Operational Metrics
The Powersports segment, which is the primary revenue driver, experienced a revenue decline of 8.2% to $293.5 million. Unit sales in this segment decreased by 3.7%, with new powersports unit retail sales slightly up by 0.6% and pre-owned unit sales down significantly by 13.4%. The Vehicle Transportation Services segment also reported a revenue decrease of 3.4% to $14.3 million, despite an increase in the number of vehicles transported.
Liquidity and Cash Flow
As of March 31, 2024, RumbleON reported cash and restricted cash totaling approximately $63.4 million. The company's total available liquidity, which includes availability under floor plan credit facilities, stood at approximately $212.7 million. Cash flow from operating activities was positive at $3.0 million, influenced by the settlement of the RumbleON Finance loan portfolio.
Management Commentary
"Our performance in the first quarter was largely in line with our expectations, with a significant year over year performance improvement as traction began on Vision 2026 in a tough macro environment," said Mike Kennedy, CEO of RumbleON. He highlighted the strength of the team in delivering these results amidst challenging industry dynamics.
Outlook and Strategic Moves
Despite the revenue shortfall, RumbleON's strategic initiatives under Vision 2026 and operational improvements indicate a robust internal framework aimed at long-term growth and market adaptation. The company's focus remains on enhancing its service offerings and operational efficiency to navigate through the prevailing market challenges effectively.
RumbleON's management will further discuss these results and more during their earnings call scheduled for May 8, 2024. This will provide additional insights into the company's strategies and outlook for the coming quarters.
For detailed financial figures and further information, readers are encouraged to view the full earnings report and listen to the earnings call, which could provide deeper insights into RumbleON's strategy and market expectations.
Explore the complete 8-K earnings release (here) from RumbleON Inc for further details.
