Achieved Combined Sales of $141.9 Million,
Representing 38.8% Year-Over-Year Growth on a Proforma
Basis
Reaffirms Full-Year Guidance for Proforma
Revenue, Gross Margin and Adjusted EBITDA
1847 Goedeker Inc. (NYSE American: GOED) (“Goedeker” or the
“Company”), one of the largest specialty ecommerce players in the
U.S. household appliances market, today reported financial results,
including proforma and GAAP financial results, for the third
quarter and nine-month period ended September 30, 2021. The
Company’s 10-Q and additional information can be accessed at
https://investor.goedekers.com/. As previously disclosed, the
Company completed the acquisition of 1 Stop Electronics Center,
Inc., Gold Coast Appliances, Inc., Superior Deals Inc., Joe’s
Appliances LLC, and YF Logistics LLC (collectively, “Appliances
Connection”) in June 2021.
Combined Proforma Financial
Highlights
Third Quarter
- Net sales were $141.9 million, compared to proforma net sales
of $102.2 million for the third quarter 2020.
- Gross profit was $31.4 million (22.1% margin), compared to
proforma gross profit of $21.0 million (20.5% margin) for the third
quarter 2020.
- Proforma net income was $3.9 million, or $0.03 per diluted
common share, compared to a loss of $0.7 million, or -$0.01 per
diluted common share, for the third quarter 2020.
- Adjusted proforma EBITDA was $11.0 million (7.7% margin).
Year to Date
- Proforma net sales were $405.0 million for the nine-month
period ended September 30th, compared to $260.4 million for the
same period in 2020.
- Proforma gross profit was $96.1 million (23.7% margin) for the
nine-month period ended September 30th, compared to $52.4 million
(20.1% margin) the same period in 2020.
- Proforma net income was $32.1 million, compared to proforma net
loss of $3.2 million for the same period in 2020.
- Adjusted proforma EBITDA was $43.9 million (10.8% margin).
GAAP Financial
Highlights
Third Quarter
- Net sales were $141.9 million, compared to $13.4 million for
the third quarter 2020.
- Gross profit totaled $31.3 million, compared to $2.2 million
for the third quarter 2020.
- Net income was $3.3 million, or $0.03 per diluted common share,
compared to a net loss of $4.2 million, or -$0.74 per diluted
common share, for the third quarter of 2020.
- Cash and cash equivalents of $27.2 million, excluding $8.0
million in restricted cash.
Business and Strategy
Highlights
Third Quarter
- Announced the appointment of Alberti Fouerti as Chief Executive
Officer.
- Began adding new talent to support the Company’s ecommerce
strategy, including individuals with experience in analytics,
marketing, merchandise and supply chain initiatives.
- Began working with an independent consultant to align executive
compensation with the Company’s future performance.
- Established plan to roll out the Company’s new brand during the
first half of 2022.
- Established plan to add multiple fulfillment centers in
strategic locations during the first half of 2022.
- Initiated an evaluation of strategies for optimizing the
Company’s capital structure following this year’s warrant
issuance.
- Shared an overview of the Company’s ecommerce strategy for
achieving growth and greater market share, and outlined the
priorities that include:
- Maintaining a best-in-class technology stack and digital
marketing presence;
- Offering expansive product selection;
- Having competitive pricing;
- Consistently providing fast and reliable shipping, and;
- Delivering stronger expert-level customer service.
Albert Fouerti, Chief Executive Officer and Director,
commented:
“Since becoming Chief Executive Officer, I have been focused on
putting in place an ecommerce strategy that leverages content,
scale and technology to help us achieve sustained growth in the
home appliances market. This was the type of strategy that was
helping us consistently grow Appliances Connection prior to the
combination with Goedeker. It is important for all of our
stockholders to know that the Company now has clear near-term
priorities that include completing our rebranding, expeditiously
expanding our fulfillment network, maintaining unmatched selection
and using our digital assets to create content-driven communities
that fuel lifetime customer loyalty. It is equally important to
stress that we are also adding new technology and supply chain
talent, appointing highly-qualified board members and exploring
ways to optimize our capital structure over time.
With respect to the quarter, we are pleased to have delivered
very healthy growth in our first full reporting period as a
combined entity. Our increased scale positioned us to obtain
inventory, meet increased customer demand and mitigate the full
impact of global supply chain constraints. We feel well-positioned
from an inventory perspective heading into next quarter, and we
will continue to execute against our outlined priorities and
aggressively pursue greater market share. We intend to follow in
the footsteps of other successful ecommerce businesses that have
maintained a disciplined focus on growth to ultimately obtain true
category leadership.”
Guidance
The Company reaffirms its previous outlook and continues to
expect full-year revenue on a proforma basis to be between $520
million and $550 million, full-year gross margin on a proforma
basis to be between 22.5% to 24.5%, and full-year proforma adjusted
EBITDA margins to be between 9.5% to 11%. As the Company’s new
management team continues to evaluate the industry landscape and
implement its ecommerce growth strategy, it is assessing what the
most appropriate metrics will be for potential future guidance.
Investor Conference Call
The Company will host an investor conference call to discuss its
financial results today at 8:00 a.m. ET. The phone number for the
investor conference call is 877-317-6789 (domestic) or 412-317-6789
(international); please ask to join the Goedeker Q3 2021 Earnings
Call.
About Goedeker
Goedeker is an industry leading ecommerce destination for
appliances, furniture and home goods. Through its June 2021
acquisition of Appliances Connection, Goedeker created one of the
largest pure-play online retailers of household appliances in the
United States. With warehouse fulfillment centers in the Northeast
and Midwest, as well as showrooms in Brooklyn, New York, St. Louis,
Missouri and Largo, Florida, Goedeker offers one-stop shopping for
national and global brands. We carry many household name-brands,
including Bosch, Cafe, Frigidaire Pro, Whirlpool, LG, and Samsung,
and also carry many major luxury appliance brands such as Miele,
Thermador, La Cornue, Dacor, Ilve, Jenn-Air and Viking among
others. We also sell furniture, fitness equipment, plumbing
fixtures, televisions, outdoor appliances, and patio furniture, as
well as commercial appliances for builder and business clients.
Learn more at www.Goedekers.com.
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 1847 Goedeker
Inc.'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" of the reports that we file with
the Securities and Exchange Commission. Forward-looking statements
contained in this announcement are made as of this date, and 1847
Goedeker Inc. undertakes no duty to update such information except
as required under applicable law.
Non-GAAP Financial Measures
The Company believes the non-GAAP financial measures presented
in this press release will help investors understand the financial
condition and operating results of the combined company and assess
the Company’s future prospects. The Company believes these non-GAAP
financial measures, each of which is discussed in greater detail
below, are important supplemental measures because they exclude
unusual or non-recurring items as well as non-cash items that are
unrelated to or may not be indicative of our ongoing operating
results. Further, when read in conjunction with GAAP results, these
non-GAAP financial measures provide a baseline for analyzing trends
in our underlying businesses and can be used by management as a
tool to help make financial, operational and planning decisions.
Finally, these measures are often used by analysts and other
interested parties to evaluate companies in our industry by
providing more comparable measures that are less affected by
factors such as capital structure.
The Company recognizes that these non-GAAP financial measures
have limitations, including that they may be calculated differently
by other companies or may be used under different circumstances or
for different purposes, thereby affecting their comparability from
company to company. In order to compensate for these and the other
limitations discussed below, management does not consider these
measures in isolation from or as alternatives to the comparable
financial measures determined in accordance with GAAP. Readers
should review the reconciliations below and should not rely on any
single financial measure to evaluate our business.
The non-GAAP financial measure used in this press release is
Adjusted EBITDA. The Company defines Adjusted EBITDA as net loss
before income taxes, depreciation and amortization, financing
costs, interest expense, sales tax accrual and one-time
non-operational events. Adjusted EBITDA is not measures calculated
in accordance with GAAP, and they should not be considered an
alternative to any financial measures that were calculated under
U.S. GAAP. Adjusted EBITDA is used to facilitate a comparison of
the ordinary, ongoing and customary course of the operations of the
combined company on a consistent basis from period to period and
provide an additional understanding of factors and trends affecting
the business of the combined company. Adjusted EBITDA may not be
comparable to similarly titled non-GAAP measures used by other
companies as other companies may have calculated the measures
differently.
The reconciliation of Adjusted EBITDA to net income for the
Company (on a pro forma basis) is provided below (in millions):
Three Months Ended
September 30, 2021
Nine Months Ended
September 30, 2021
NET INCOME
$
3.9
$
32.1
ADJUSTMENTS
Income taxes
2.3
(4.0)
Depreciation and amortization
2.8
8.3
Financing costs
0.2
0.3
Interest expense
0.9
2.4
EBITDA
10.1
39.1
Acquisition expenses
0.1
0.9
Loss on extinguishment of debt
-
1.7
Loss on abandonment of Right of Use
asset
-
1.4
Severance expense
0.8
0.8
ADJUSTED EBITDA
$11.0
$43.9
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211115005708/en/
Goedeker Investor Relations IR@goedekers.com
Greg Marose / Ashley Areopagita ir@goedekers.com
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