CarLotz Announces Second Quarter 2021 Financial Results
Unit Sales Grew
Revenue Growth of
Record Gross Profit of
Withdraws Previously Provided 2021 Outlook due to Channel Constraints
RICHMOND, Va., Aug. 09, 2021 (GLOBE NEWSWIRE) -- CarLotz, Inc. (“CarLotz” or the “Company”), a leading consignment-to-retail used vehicle marketplace, today announced financial results for the second quarter ended June 30, 2021.
Highlights of Second Quarter 2021 Financial Results
- Net revenues increased
92% to$50.8 million from$26.4 million in the same period in 2020 - Gross Profit increased
53% to$4.2 million from$2.7 million in the prior year period - Retail Gross Profit per Unit (“Retail GPU”) increased
17% to$2,175 from$1,858 in the prior year period - Retail unit sales were 2,009 compared to 1,376 in the prior year period, an increase of
46% - Net Loss attributable to common shareholders was
$(7.2) million , or$(0.06) per diluted share, for the second quarter 2021 versus$(0.2) million , or$(0.00) per diluted share in the prior year period - Adjusted EBITDA was
$(15.2) million compared to$(0.3) million in the second quarter of 2020
“We are very pleased with our second quarter results, having met our unit guidance and significantly outperforming our GPU guidance,” said Michael Bor, Co-Founder and CEO of CarLotz. “Despite a dynamic operating environment, the quarter was highlighted by record Gross Profit and four new hub openings, in addition to the announcement of the opening of six additional hubs. I am extremely proud of the hard work and commitment demonstrated by the entire team over the last six months since we became a public company, including doubling our number of hub locations, hiring experienced talent across the company, and executing on significant technology and marketing initiatives to provide a structure to support significant growth.”
Mr. Bor continued, “Looking ahead to the second half of the year, we recognize the macro environment remains challenging to our business model and we will continue to make the strategic and tactical investments necessary to further establish the base on which to scale into a nationwide vehicle consignment and sales marketplace. To that end, we remain very confident in our long-term consignment strategy and value proposition and are intensely focused on driving long-term value for all our stakeholders.”
Fiscal 2021 Outlook
As a result of the continued disruption caused by the chip shortage and the corresponding lack of visibility into the wholesale market and commercial vehicle sourcing, the Company is withdrawing its previously provided financial outlook for fiscal 2021 at this time.
Qualitatively, the Company expects to see unit growth in the third quarter over the second quarter of 2021. Additionally, we have seen gross profit compression in the third quarter to date compared to the second quarter and we expect it to continue through the end of the year as a result of the Company’s reliance on competitively-sourced owned inventory until consignment volumes increase.
Webcast and Conference Call Information
A conference call to discuss the second quarter 2021 financial results is scheduled for today, August 9, 2021 at 5:30 pm ET. Interested parties may listen to the conference call via telephone by dialing 1-833-962-1461, or for international callers, 1-929-517-0392. A telephone replay will be available until 11:59 pm ET on August 16, 2021 and can be accessed by dialing 1-855-859-2056, or for international callers, 1-404-537-3406 and entering replay Pin number: 9089546.
The conference call webcast will be available at www.investors.carlotz.com.
About CarLotz, Inc.
CarLotz is a used vehicle consignment and Retail Remarketing™ business that provides our corporate vehicle sourcing partners and retail sellers of used vehicles with the ability to access the previously unavailable retail sales channel, while simultaneously providing buyers with prices that are, on average, below those of traditional dealerships. Our mission is to create the world’s greatest vehicle buying and selling experience. We operate a technology-enabled buying, sourcing, and selling model that offers a seamless omnichannel experience and comprehensive selection of vehicles, while allowing for a fully contactless end-to-end e-commerce interface that enables no-hassle buying and selling.
Our proprietary Retail Remarketing™ technology provides our corporate vehicle sourcing partners with real-time performance metrics and data analytics, along with custom business intelligence reporting that enables price and vehicle triage optimization between the wholesale and retail channels. Through our marketplace model, we generate significant value for both sellers and buyers through price, selection, and experience.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Generally, forward-looking statements include statements that are not historical facts, such as statements concerning possible or assumed future actions, business strategies, events or results of operations, including statements regarding CarLotz’ expectations or predictions of future financial or business performance or conditions. Forward-looking statements may be preceded by, followed by or include the words “believes,” “estimates,” “expects,” “projects,” “forecasts,” “may,” “will,” “should,” “seeks,” “plans,” “scheduled,” “anticipates” or “intends” or similar expressions. Such statements are based on management’s current expectations and are not guarantees of future performance. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the results projected, expressed or implied by these forward-looking statements. Factors that could cause such differences include those disclosed in CarLotz’ filings with the SEC, including those resulting from the impact of the ongoing Covid-19 pandemic on our business and general business and economic conditions and our ability to successfully execute our geographic expansion plans. Forward-looking statements speak only as of the date they are made, and CarLotz is under no obligation, and expressly disclaims any obligation, to update, alter or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
Investors:
CarLotzIR@icrinc.com
Media:
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CarLotz, Inc. and Subsidiaries — Condensed Consolidated Balance Sheet
(unaudited)
(In thousands, except share data)
| June 30, 2021 | December 31, 2020 | ||||||
| Assets | |||||||
| Current Assets: | |||||||
| Cash and cash equivalents | $ | 83,576 | $ | 2,208 | |||
| Restricted cash | 226 | 605 | |||||
| Marketable securities – at fair value | 175,424 | 1,032 | |||||
| Accounts receivable, net | 5,411 | 4,132 | |||||
| Inventories | 47,469 | 11,202 | |||||
| Other current assets | 6,253 | 6,679 | |||||
| Total Current Assets | 318,359 | 25,858 | |||||
| Marketable securities – at fair value | 3,481 | — | |||||
| Property and equipment, net | 11,662 | 1,868 | |||||
| Capitalized software | 9,898 | — | |||||
| Lease vehicles, net | 337 | 173 | |||||
| Other assets | 4,390 | 299 | |||||
| Total Assets | $ | 348,127 | $ | 28,198 | |||
| Liabilities, Redeemable Convertible Preferred Stock, Stockholders’ Equity (Deficit) | | ||||||
| Current Liabilities: | | ||||||
| Long-term debt, current | $ | 212 | $ | 6,370 | |||
| Floor plan notes payable | 29,427 | 6,039 | |||||
| Accounts payable | 8,782 | 6,283 | |||||
| Accrued transaction expenses | — | 6,052 | |||||
| Accrued expenses | 13,238 | 3,563 | |||||
| Accrued expenses – related party | — | 5,082 | |||||
| Other current liabilities | 5,425 | 256 | |||||
| Total Current Liabilities | 57,084 | 33,645 | |||||
| Long-term debt, less current portion | 7,579 | 2,999 | |||||
| Redeemable convertible preferred stock tranche obligation | — | 2,832 | |||||
| Earnout provision | 30,228 | — | |||||
| Merger warrant liability | 26,341 | — | |||||
| Other liabilities | 1,232 | 1,959 | |||||
| Total Liabilities | 122,464 | 41,435 | |||||
| Commitments and Contingencies (Note 15) | — | — | |||||
| Redeemable Convertible Preferred Stock: | | | |||||
| Series A Preferred Stock, | — | — | |||||
| Stockholders’ Equity (Deficit): | | ||||||
| Common stock, | 11 | 6 | |||||
| Additional paid-in capital | 281,976 | 20,779 | |||||
| Accumulated deficit | (56,264 | ) | (34,037 | ) | |||
| Accumulated other comprehensive income | (60 | ) | 15 | ||||
| Treasury stock, | — | — | |||||
| Total Stockholders’ Equity (Deficit) | 225,663 | (13,237 | ) | ||||
| Total Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) | $ | 348,127 | $ | 28,198 | |||
CarLotz, Inc. and Subsidiaries — Consolidated Statements of Operations
(unaudited)
(In thousands, except per share and share data)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2021 | 2020 | 2021 | 2020 | ||||||||||||
| Revenues: | | | | | |||||||||||
| Retail vehicle sales | $ | 44,230 | $ | 23,652 | $ | 94,613 | $ | 44,694 | |||||||
| Wholesale vehicle sales | 4,660 | 1,725 | 9,228 | 5,036 | |||||||||||
| Finance and insurance, net | 1,780 | 895 | 3,334 | 1,787 | |||||||||||
| Lease income, net | 98 | 127 | 205 | 272 | |||||||||||
| Total Revenues | 50,768 | 26,399 | 107,380 | 51,789 | |||||||||||
| Cost of sales (exclusive of depreciation) | 46,586 | 23,670 | 101,190 | 46,588 | |||||||||||
| Gross Profit | 4,182 | 2,729 | 6,190 | 5,201 | |||||||||||
| Operating Expenses: | | | | | |||||||||||
| Selling, general and administrative | 19,386 | 3,073 | 38,259 | 6,989 | |||||||||||
| Stock-based compensation expense | 3,704 | 3 | 45,667 | 37 | |||||||||||
| Depreciation and amortization expense | 95 | 91 | 478 | 191 | |||||||||||
| Management fee expense – related party | — | 70 | 2 | 132 | |||||||||||
| Total Operating Expenses | 23,185 | 3,237 | 84,406 | 7,349 | |||||||||||
| Loss from Operations | (19,003 | ) | (508 | ) | (78,216 | ) | (2,148 | ) | |||||||
| Interest Expense | 184 | 107 | 359 | 256 | |||||||||||
| Other Income (Expense), net | | ||||||||||||||
| Change in fair value of merger warrants liability | 325 | — | 12,683 | — | |||||||||||
| Change in fair value of redeemable convertible preferred stock tranche obligation | — | 345 | — | 629 | |||||||||||
| Change in fair value of earnout provision | 12,210 | — | 44,056 | — | |||||||||||
| Other income (expense) | (553 | ) | 61 | (391 | ) | 64 | |||||||||
| Total Other Income (Expense), net | 11,982 | 406 | 56,348 | 693 | |||||||||||
| Loss Before Income Tax Expense | (7,205 | ) | (209 | ) | (22,227 | ) | (1,711 | ) | |||||||
| Income tax expense | — | 4 | — | 9 | |||||||||||
| Net Loss | $ | (7,205 | ) | $ | (213 | ) | $ | (22,227 | ) | $ | (1,720 | ) | |||
| Net loss per share, basic and diluted | $ | (0.06 | ) | $ | 0.00 | $ | (0.21 | ) | $ | (0.03 | ) | ||||
| Weighted-average shares used in computing net loss per share, basic and diluted | 113,670,060 | 58,621,041 | 107,279,227 | 58,621,041 | |||||||||||
CarLotz, Inc. and Subsidiaries — Condensed Consolidated Statements of Cash Flows
(unaudited)
(In thousands, except per share and share data)
| | Six Months Ended June 30, | ||||||
| | 2021 | 2020 | |||||
| Cash Flow from Operating Activities | | | |||||
| Net loss | $ | (22,227 | ) | (1,720 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | | | |||||
| Depreciation – property and equipment | 448 | 101 | |||||
| Amortization and accretion - marketable securities | 788 | — | |||||
| Depreciation – lease vehicles | 30 | 90 | |||||
| Loss on marketable securities | — | (3 | ) | ||||
| Provision for doubtful accounts | — | 6 | |||||
| Stock-based compensation expense | 45,667 | 37 | |||||
| Change in fair value of Merger warrants liability | (12,683 | ) | — | ||||
| Change in fair value of historic warrants liability | — | (31 | ) | ||||
| Change in fair value of earnout shares | (44,056 | ) | — | ||||
| Change in fair value of debt issuance costs and stock warrant | — | 12 | |||||
| Change in fair value of redeemable convertible preferred stock tranche obligation | — | (629 | ) | ||||
| Change in Operating Assets and Liabilities: | | | |||||
| Accounts receivable | (1,279 | ) | (336 | ) | |||
| Inventories | (36,117 | ) | 5,064 | ||||
| Other current assets | (5,466 | ) | (39 | ) | |||
| Other assets | (4,091 | ) | 5 | ||||
| Accounts payable | 2,499 | 719 | |||||
| Accrued expenses | 6,187 | 1,048 | |||||
| Accrued expenses – related party | (229 | ) | 13 | ||||
| Other current liabilities | 447 | 117 | |||||
| Other liabilities | (582 | ) | 248 | ||||
| Net Cash (Used in)/Provided by Operating Activities | (70,664 | ) | 4,702 | ||||
| Cash Flows from Investing Activities | | | |||||
| Purchase of property and equipment | (3,548 | ) | (14 | ) | |||
| Capitalized website and internal-use software costs | (6,601 | ) | — | ||||
| Purchase of marketable securities | (307,560 | ) | (711 | ) | |||
| Proceeds from sales of marketable securities | 128,954 | 21 | |||||
| Purchase of lease vehicles | (344 | ) | (87 | ) | |||
| Net Cash Used in Investing Activities | (189,099 | ) | (791 | ) | |||
| Cash Flows from Financing Activities | | | |||||
| Payments made on long-term debt | (18 | ) | (5 | ) | |||
| Advance from holder of marketable securities | 4,722 | — | |||||
| PIPE Issuance | 125,000 | — | |||||
| Merger financing | 309,999 | — | |||||
| Payment made on accrued dividends | (4,853 | ) | — | ||||
| Payments to existing shareholders of Former CarLotz | (62,693 | ) | — | ||||
| Transaction costs and advisory fees | (47,579 | ) | — | ||||
| Payments made on cash considerations associated with stock options | (2,465 | ) | — | ||||
| Repayment of Paycheck Protection Program loan | (1,749 | ) | — | ||||
| Payments made on note payable | (3,000 | ) | — | ||||
| Borrowings on long-term debt | — | 2,249 | |||||
| Payments on floor plan notes payable | (29,056 | ) | (13,394 | ) | |||
| Borrowings on floor plan notes payable | 52,444 | 8,598 | |||||
| Net Cash Provided by/( Used in) Financing Activities | 340,752 | (2,552 | ) | ||||
| Net Change in Cash and Cash Equivalents Including Restricted Cash | 80,989 | 1,359 | |||||
| Cash and cash equivalents and restricted cash, beginning | 2,813 | 4,102 | |||||
| Cash and cash equivalents and restricted cash, ending | $ | 83,802 | $ | 5,461 | |||
| Supplemental Disclosure of Cash Flow Information | |||||||
| Cash paid for interest | $ | 490 | $ | 307 | |||
| Supplementary Schedule of Non-cash Investing and Financing Activities: | | | |||||
| Transfer from lease vehicles to inventory | $ | 150 | $ | 199 | |||
| Redeemable convertible preferred stock distributions accrued | — | 923 | |||||
| Issuance of common stock warrants | — | 15 | |||||
| KAR/AFC exercise of stock warrants | (144 | ) | — | ||||
| KAR/AFC conversion of notes payable | (3,625 | ) | — | ||||
| Convertible redeemable preferred stock tranche obligation expiration | (2,832 | ) | — | ||||
| Capitalized website and internal use software costs accrued | (3,488 | ) | — | ||||
| Purchases of property under capital lease obligation | (6,504 | ) | — | ||||
CarLotz, Inc. and Subsidiaries — Results of Operations, Retail Gross Profit per Unit
(unaudited)
(In thousands, except share data)
| | Three Months Ended June 30, | ||||||||||||||
| | 2021 | 2020 | Change | Change | |||||||||||
| Revenue: | |||||||||||||||
| Retail vehicle sales | $ | 44,230 | $ | 23,652 | $ | 20,578 | 87 | % | |||||||
| Wholesale vehicle sales | 4,660 | 1,725 | 2,935 | 170 | % | ||||||||||
| Finance and insurance, net | 1,780 | 895 | 885 | 99 | % | ||||||||||
| Lease income, net | 98 | 127 | (29 | ) | (23 | ) | % | ||||||||
| Total revenues | 50,768 | 26,399 | 24,369 | 92 | % | ||||||||||
| Cost of sales: | | | |||||||||||||
| Retail vehicle cost of sales | $ | 41,641 | $ | 21,991 | $ | 29,362 | 89 | % | |||||||
| Wholesale vehicle cost of sales | 4,945 | 1,679 | 2,324 | 195 | % | ||||||||||
| Total cost of sales | $ | 46,586 | $ | 23,670 | $ | 22,916 | 97 | % | |||||||
| Gross profit: | | | |||||||||||||
| Retail vehicle gross profit | $ | 2,589 | $ | 1,661 | $ | 928 | 56 | % | |||||||
| Wholesale vehicle gross profit | (285 | ) | 46 | (331 | ) | 720 | % | ||||||||
| Finance and insurance gross profit | 1,780 | 895 | 885 | 99 | % | ||||||||||
| Lease income, net | 98 | 127 | (29 | ) | (23 | ) | % | ||||||||
| Total gross profit | $ | 4,182 | $ | 2,729 | $ | 1,453 | 53 | % | |||||||
| Retail gross profit per unit(1): | | | | ||||||||||||
| Retail vehicles gross profit | $ | 2,589 | $ | 1,661 | $ | 928 | 55.9 | % | |||||||
| Finance and insurance gross profit | 1,780 | 895 | 885 | 98.9 | % | ||||||||||
| Total retail vehicles and finance and insurance gross profit | 4,369 | 2,556 | 1,813 | 70.9 | % | ||||||||||
| Retail vehicles unit sales | 2,009 | 1,376 | 633 | 46.0 | % | ||||||||||
| Retail vehicles gross profit per unit | $ | 2,175 | $ | 1,858 | $ | 317 | 17.1 | % | |||||||
(1) Gross profit per unit is calculated as gross profit for retail vehicles and finance and insurance, each of which is divided by the total number of retail vehicles sold in the period.
CarLotz, Inc. and Subsidiaries — Results of Operations, Retail Gross Profit per Unit
(unaudited)
(In thousands, except share data)
| | Six Months Ended June 30, | ||||||||||||||
| | 2021 | 2020 | Change | Change | |||||||||||
| Revenue: | |||||||||||||||
| Retail vehicle sales | $ | 94,613 | $ | 44,694 | $ | 49,919 | 112 | % | |||||||
| Wholesale vehicle sales | 9,228 | 5,036 | 4,192 | 83 | % | ||||||||||
| Finance and insurance, net | 3,334 | 1,787 | 1,547 | 87 | % | ||||||||||
| Lease income, net | 205 | 272 | (67 | ) | (25 | ) | % | ||||||||
| Total revenues | 107,380 | 51,789 | 55,591 | 107 | % | ||||||||||
| Cost of sales: | | | |||||||||||||
| Retail vehicle cost of sales | $ | 90,558 | $ | 41,546 | $ | 49,012 | 118 | % | |||||||
| Wholesale vehicle cost of sales | 10,632 | 5,042 | 5,590 | 111 | % | ||||||||||
| Total cost of sales | $ | 101,190 | $ | 46,588 | $ | 54,602 | 117 | % | |||||||
| Gross profit: | | | |||||||||||||
| Retail vehicle gross profit | $ | 4,055 | $ | 3,148 | $ | 907 | 29 | % | |||||||
| Wholesale vehicle gross profit | (1,404 | ) | (6 | ) | (1,398 | ) | 23,300 | % | |||||||
| Finance and insurance gross profit | 3,334 | 1,787 | 1,547 | 87 | % | ||||||||||
| Lease income, net | 205 | 272 | (67 | ) | (25 | ) | % | ||||||||
| Total gross profit | $ | 6,190 | $ | 5,201 | $ | 989 | 19 | % | |||||||
| Retail gross profit per unit(1): | | | |||||||||||||
| Retail vehicles gross profit | $ | 4,055 | $ | 3,148 | $ | 907 | 29 | % | |||||||
| Finance and insurance gross profit | 3,334 | 1,787 | 1,547 | 87 | % | ||||||||||
| Total retail vehicles and finance and insurance gross profit | 7,389 | 4,935 | 2,454 | 50 | % | ||||||||||
| Retail vehicles unit sales | 4,563 | 2,829 | 1,734 | 61 | % | ||||||||||
| Retail vehicles gross profit per unit | $ | 1,619 | $ | 1,744 | $ | (125 | ) | (7 | ) | % | |||||
(1) Gross profit per unit is calculated as gross profit for retail vehicles and finance and insurance, each of which is divided by the total number of retail vehicles sold in the period.
CarLotz, Inc. and Subsidiaries — EBITDA and Adjusted EBITDA
(unaudited)
(In thousands, except share data)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2021 | 2020 | Change | 2021 | 2020 | Change | ||||||||||||||||||
| Net Loss | $ | (7,205 | ) | $ | (213 | ) | $ | (6,992 | ) | $ | (22,227 | ) | $ | (1,720 | ) | $ | (20,507 | ) | |||||
| Adjusted to exclude the following: | |||||||||||||||||||||||
| Interest expense | 184 | 107 | 77 | 359 | 256 | 103 | |||||||||||||||||
| Income tax expense | — | 4 | (4 | ) | — | 9 | (9 | ) | |||||||||||||||
| Depreciation and amortization expense | 95 | 91 | 4 | 478 | 191 | 287 | |||||||||||||||||
| EBITDA | $ | (6,926 | ) | $ | (11 | ) | $ | (6,915 | ) | $ | (21,390 | ) | $ | (1,264 | ) | $ | (20,126 | ) | |||||
| Other expense | 553 | (61 | ) | 614 | 391 | (64 | ) | 455 | |||||||||||||||
| Stock compensation expense | 3,704 | 3 | 3,701 | 45,667 | 37 | 45,630 | |||||||||||||||||
| Management fee expense - related party | — | 70 | (70 | ) | 2 | 132 | (130 | ) | |||||||||||||||
| Change in fair value of warrants liability | (325 | ) | — | (325 | ) | (12,683 | ) | — | (12,683 | ) | |||||||||||||
| Change in fair value of redeemable convertible preferred stock tranche obligation | — | (345 | ) | 345 | — | (629 | ) | 629 | |||||||||||||||
| Change in fair value of earnout provision | (12,210 | ) | — | (12,210 | ) | (44,056 | ) | — | (44,056 | ) | |||||||||||||
| Adjusted EBITDA | $ | (15,204 | ) | $ | (344 | ) | $ | (14,860 | ) | $ | (32,069 | ) | $ | (1,788 | ) | $ | (30,281 | ) | |||||
