- Upon Closing 1847 Goedeker revenue is expected to reach $400M
on an annualized basis in 2021, with approximately $30M in
EBITDA
- Creates one of the largest independent online retailers of
Household Appliances in the U.S.
- Accelerates strategy to become America’s most profitable
Direct-To-Consumer Appliance Reseller
- Adds entry into U.S. Government Accounts Market with General
Services Administration (GSA) contract
- Appliances Connection ships 800-1000 orders daily with its
advanced logistics, shipping, delivery, and installation
platform
- Capitalizes on key operational strengths in executive
leadership, marketing, logistics, and vendor costs
- Synergies expected to lower SG&A costs, increase
profitability
- Expands and strengthens management team
- Adds a 200,000 Square Foot Warehouse and distribution center in
Hamilton, New Jersey
- Adds 23,000 square foot Showroom in Brooklyn, NY
- Adds a fleet of 29 Delivery Trucks
- Transaction expected to close during first quarter of 2021
- Appliances Connection will continue to operate the business
post-closing
1847 Goedeker Inc. (NYSE American: GOED) ("Goedeker’s" or the
"Company"), a one-stop e-commerce destination for appliances,
furniture, home goods, and related products, announced today the
entry into a definitive agreement for the acquisition of Appliances
Connection, one of the leading retailers of household appliances in
the U.S. In a deal valued at $210,000,000, the acquisition will be
financed with a combination of cash and equity and is expected to
close in the first quarter of 2021. The combined entities are
expected to generate approximately $400M of revenue and $30M in
EBITDA in 2021, making 1847 Goedeker one of the most attractive,
large independent online appliance retailers. The principals from
Appliances Connection, Albert, and Elie Fouerti, will continue in
their current leadership roles and Albert Fouerti will join the
board of directors of 1847 Goedeker.
Doug Moore, CEO of 1847 Goedeker stated: “I am thrilled that we
have reached a Definitive Agreement to acquire Appliances
Connection, a 20-year-old company with a sterling reputation and
strong management. We are addressing a $21B US household appliance
market growing at 13.7% CAGR (expected to reach $40B by 2025).
Together with Appliances Connection, we will significantly increase
our operational strengths and realize substantial synergies by
combining marketing, logistics, delivery, and installation platform
for continued strong top and bottom-line growth. As I have stated
publicly, my vision is to become the most profitable online
retailer of appliances in the U.S. This acquisition catapults us
into becoming the fastest growing online appliance retailer in the
U.S. today.”
CEO of Appliances Connection, Albert Fouerti, commented: “We
have spent the last 20 years building an extremely successful
business, which includes residential, commercial and government
divisions driven by an industry leading e-commerce platform. Our
highly efficient nationwide delivery and installation operation and
our strong presence in the northeastern United States provides us
with important competitive advantages. I look forward to working
closely with the Goedeker’s team to continue to scale the business,
increase profits and make Goedeker’s the most profitable online
appliance retailer in the nation.”
Chairman of 1847 Goedeker, Ellery Roberts, stated: “This
acquisition dramatically increases our scale and scope, provides a
huge boost to revenue and profitability, while expanding and
strengthening our management team. We will now have a warehouse in
the Northeast and Midwest, a fleet of 29 delivery trucks, a greatly
expanded product line, and a robust platform with tremendous
scalability as we continue to execute on our growth strategy. This
is a very exciting time for our shareholders!”
About Appliances Connection
Founded in 2000, Appliances Connection is one of the leading
retailers of household appliances with a 200,000 square foot
warehouse in Hamilton, NJ and a 23,000 square foot showroom in
Brooklyn, New York. Appliances Connection carries many household
name brands, including Bosch, GE, Frigidaire, Whirlpool, LG, and
Samsung, and also carries many major luxury appliance brands such
as Verona, Thermador, La Cornue, Dacor, Smeg, and Viking. Appliance
Connection provides appliance installation services and old
appliance removal services. In addition to selling appliances, it
also sells furniture, fitness equipment, plumbing fixtures,
televisions, outdoor appliances, and patio furniture, as well as
commercial appliances for builder and business clients.
About 1847 Goedeker Inc.
The Company is an industry leading e-commerce destination for
appliances, furniture, and home goods. Since its founding in 1951,
the Company has transformed from a local brick and mortar operation
serving the St. Louis metro area to a respected nationwide
omnichannel retailer that offers one-stop shopping for national and
global brands. While the Company maintains its St. Louis showroom,
over 90% of sales are placed through its website
(www.goedekers.com). The Company provides visitors an easy to
navigate shopping experience and offers more than 185,000 items
organized by category and product features. Specialization in the
home category has enabled the Company to build a shopping
experience and an advanced logistics infrastructure that is
tailored to the unique characteristics of the market. Learn more at
www.goedekers.com.
Non-GAAP Financial Measure
EBITDA is not a measure of financial performance under U.S.
GAAP. EBITDA is defined as net income attributable to our business
before interest expense, provision for income tax, and depreciation
and amortization. We believe EBITDA provides additional information
about (i) our operating performance, because it assists us in
comparing the operating performance of our business on a consistent
basis, as it removes the impact of non-cash depreciation and
amortization expense as well as items not directly resulting from
our core operations such as interest expense and income taxes and
(ii) our performance and the effectiveness of our operational
strategies. Additionally, EBITDA is used as a measure in our
executive compensation plans. Furthermore, EBITDA is used by
investors as a supplemental measure to evaluate the overall
operating performance of companies in our industry.
Management believes that investors' understanding of our
performance is enhanced by including this non-GAAP financial
measure as a reasonable basis for comparing our ongoing results of
operations. Many investors are interested in understanding the
performance of our business by comparing our results from ongoing
operations period over period and would ordinarily add back
non-cash expenses such as depreciation and amortization as well as
items that are not part of normal day-to-day operations of our
business such as interest expense and income taxes. By providing
this non-GAAP financial measure, we believe we are enhancing
investors' understanding of our business and our results of
operations, as well as assisting investors in evaluating how well
we are executing our strategic initiatives.
Our competitors may define EBITDA differently, and as a result,
our measure of EBITDA may not be directly comparable to EBITDA of
other companies. Items excluded from EBITDA are significant
components in understanding and assessing financial performance.
EBITDA is a supplemental measure of operating performance that does
not represent and should not be considered in isolation or as an
alternative to, or substitute for net income or other financial
statement data presented in the consolidated financial statements
of our company as indicators of financial performance. EBITDA has
limitations as an analytical tool, and should not be considered in
isolation, or as a substitute for analysis of our results as
reported under U.S. GAAP.
Some of the limitations are:
- EBITDA does not reflect our cash expenditures, or future
requirements for capital expenditures or contractual
commitments;
- EBITDA does not reflect changes in, or cash requirements for,
our working capital needs;
- EBITDA does not reflect the interest expense, or the cash
requirements necessary to service interest or principal on any
indebtedness we may have;
- EBITDA does not reflect our tax expense or the cash
requirements to pay our taxes; and
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future and EBITDA does not reflect any cash
requirements for such replacements.
Due to these limitations, EBITDA should not be considered as a
measure of discretionary cash available to us to invest in the
growth of our business. We compensate for these limitations by
relying primarily on our U.S. GAAP results and using EBITDA only
supplementally. We further believe that our presentation of these
U.S. GAAP and non-GAAP financial measurements provide information
that is useful to analysts and investors because they are important
indicators of the strength of our operations and the performance of
our business.
As the EBITDA data provided in this press release is a
projection of future EBITDA and we have not disclosed or otherwise
provided projected net income elsewhere, we will reconcile EBITDA
to net income in a future report that we file with the SEC that
contains the comparable GAAP measure of net income.
Forward Looking Statements
This press release contains "forward-looking statements" that
are subject to substantial risks and uncertainties. All statements,
other than statements of historical fact, contained in this press
release are forward-looking statements. Forward-looking statements
contained in this press release may be identified by the use of
words such as "anticipate," "believe," "contemplate," "could,"
"estimate," "expect," "intend," "seek," "may," "might," "plan,"
"potential," "predict," "project," "target," "aim," "should,"
"will" "would," or the negative of these words or other similar
expressions, although not all forward-looking statements contain
these words. Forward-looking statements are based on the Company’s
current expectations and are subject to inherent uncertainties,
risks and assumptions that are difficult to predict. Further,
certain forward-looking statements are based on assumptions as to
future events that may not prove to be accurate. These and other
risks and uncertainties are described more fully in the section
titled "Risk Factors" in the final prospectus related to the public
offering filed with the Securities and Exchange Commission and
other reports filed with the Securities and Exchange Commission
thereafter. Forward-looking statements contained in this
announcement are made as of this date, and the Company undertakes
no duty to update such information except as required under
applicable law.
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version on businesswire.com: https://www.businesswire.com/news/home/20201026005868/en/
Investor Relations Dave Gentry, CEO RedChip Companies Inc.
Office: 1.800.RED.CHIP (733.2447) Cell: 407.491.4498
dave@redchip.com
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