LMP Automotive Holdings, Inc.
Q4 2020 Earnings Call Transcript
Published:
- Operator:
- Thank you for standing by. This is the conference operator. Welcome to the LMP Automotive Holdings Fourth Quarter and Full Year 2020 Financial Results Conference Call. All participants are in a listen-only mode and the conference is being recorded. After a presentation by management, there will be an opportunity to ask questions. Before we begin, I would like to remind everyone that this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements pertaining to future financial and/or operating results along with other statements about the future expectations, beliefs, goals, plans or prospects expressed by management constitute forward-looking statements. Any statements that are not historical facts should also be considered forward-looking statements. And, of course, forward-looking statements involve risks and uncertainties.
- Sam Tawfik:
- Thank you, operator, and good afternoon all. And I want to thank everybody for joining the call today. We are pleased to announce the material transformation of the company by way of acquisitions that we've closed this month. These additions transformed the company from a $30 million revenue company last year to an excess of 500 million in annualized revenue this current year, representing over 1,600% increase from 2020, also generating 20 million in annualized adjusted EBITDA income. These transactions represent over a 30% return on invested capital annually for the dealerships and almost twice the average market return on the real estate. The acquisitions market remains robust, and the company is well positioned to continue the acceleration of our growth strategy. Some highlights for last year versus 2019. Revenue increased 180%, so a little over $30 million. Gross profit increased by $3.2 billion to $3.1 million. Subscription leasing and rental margins increased by 113% to 56%, adjusted EBITDA loss was 1.31 million with an adjusted EBITDA margin of 4.3%, an improvement of about three quarters of $1 million and 14%, respectively. Adjusted EBITDA loss per share was $0.13, an increase of $0.01. Shareholder equity and current shares outstanding at fiscal year ending 2020 was 29.1 million and 10.03 million, respectively. Now, I'm going to pass the call over to our Chief Financial Officer, Evan Bernstein, for some more detail on our results.
- Evan Bernstein:
- Thank you, Sam. Our 2020 adjusted EBITDA improved by 744,000. Our revenue increased over 2019 by 180,000. Our operating expenses increased from prior year. As we staffed up and increased our acquisition activity, the expenses were $7.5 million in 2020, an increase of approximately 3.7 million over 2019. Our subscription service revenue increased 7.5% over prior year. And our vehicle sales revenue increased 207% to 28 million. The interest revenue increased by over 500,000 and the shareholder equity increased to 29 million at the end of 2020, up from 10 million in 2019. I'm now going to hand it over to Richard Aldahan, our Chief Operating Officer to give an overview of our near-term outlook.
- Richard Aldahan:
- Thank you, Evan. I would also like to thank everyone for joining this call. Before I get into the details, I want to share with everyone that in early March of this year and as late as this past Tuesday, we closed on many of our previously announced acquisitions. Our investment to date is approximately $15 million, which has historically generated over 0.5 billion. That's right, $500 million in revenue and $18 million in adjusted EBITDA.
- Sam Tawfik:
- Thank you very much, Richard. In the near term, between now and the end of next year, at the forefront of our efforts is our unique and profitable industry consolidation effort by means of our dealer principal partnership acquisition structure in which we're seeing extraordinary interest from both small and large dealer groups that want to diversify as well as stay in the game, as well as operate and grow the business. The strategy remains LMP’s primary focus given the impressive returns, as stated earlier, on invested capital and the significant addition to income and earnings it provides. We believe this is the swiftest way to increase earnings and shareholder value. Our goal between now and the end of next year is to add an additional 80 to 100 dealerships to our network, which we project will add an additional 5.1 billion to 6.4 billion in revenue and approximately 136 million to 170 million in adjusted EBITDA income post minority interest.
- Operator:
- Thank you. At this time, we will be conducting a question-and-answer session. . Our first question comes from Matt Horn , private investor. Please go ahead.
- Unidentified Analyst:
- Hi. Good afternoon, everybody. My question is pretty simple. I think everyone wants to know what happened with the Atlantic deal.
- Sam Tawfik:
- I can answer that. This is Sam. Atlantic is a unique dealership group. It's essentially the most contiguous dealership group in the United States. And that dealer was unable to be consummated because of that. There are parameters that are involved with the factories, et cetera that if they don't grandfather it in, then it can't be sold to one buyer.
- Unidentified Analyst:
- Okay, great. I have one other question. I just want to know when you anticipate adding all the new acquisitions into the online where we can see the subscriptions and the vehicles for sale, everything that's been acquired at this point.
- Sam Tawfik:
- That's in progress and we're targeting the next several weeks to roll in early onto our systems.
- Unidentified Analyst:
- Fantastic. That's all I have. Thank you.
- Sam Tawfik:
- Thank you, Matt.
- Operator:
- There are no further questions. I would like to turn the floor over to Sam for -- we have one more. Hold on. Next question, Mitchell Farr , private investor, please go ahead.
- Unidentified Analyst:
- Hello, Sam. Mitchell Farr down in South Florida. Just curious, when is the new design Web site going to be live?
- Sam Tawfik:
- It’s currently live and the back ends are integrated to our dealership acquisitions that we closed. And we're now synchronizing less the technology but more of a human effort of process and procedure to roll the inventory in after a vehicle is photograph. It should automatically appear on our systems and we're automating the process end to end. So there's not much human interaction there, but the new site is live. The inventory will start rolling in, in the coming weeks.
- Unidentified Analyst:
- Is it the same app or is it going to be a new application?
- Sam Tawfik:
- Okay. So the Web site is live. The app should come live we're targeting April -- call it third week in April to then roll that into the app, have a look and feel as well as the inventory.
- Unidentified Analyst:
- Excellent. Thank you.
- Sam Tawfik:
- Thank you, Mitchell.
- Unidentified Analyst:
- You’re welcome.
- Operator:
- Thank you. I would like to turn the floor over to Sam for closing remarks.
- Sam Tawfik:
- Thank you all for joining the call today. And looking forward to our continued progress and keeping you up to date. Thanks, again.
- Operator:
- This concludes today's teleconference. You may disconnect your lines at this time and thank you for your participation.