Despite what Lazydays described as an unusual and quirky economy, the Tampa-based RV retailer has bought a Knoxville, Tennessee-based RV store that will bring in $40 million a year, company officials told investors during an earnings call on Friday.
The store, Buddy Gregg RVs, is located in Knoxville and will replace a Lazydays lot in Maryville, Tennessee, south of Knoxville, that had to close because the Tennessee Department of Transportation is expanding the Alcoa Highway.
The Knoxville store will be rebranded to Lazydays RV of Knoxville at Turkey Creek.
Most of the lost Maryville revenue should head to the rebranded store, but Lazydays CEO John North says it's never going to get all of it.
"The Marysville store was not insignificant in terms of revenue," says North. "I think some of that revenue will move over to Buddy Gregg. In my experience, typically, when you take two stores and push them into one, it's not a 100% combination."
North also told analysts and investors on a conference call that the pandemic is still affecting travel and RV sales. But even as Americans are eager to get outdoors after the 2020-2021 COVID-19 shutdowns, many of the RV sales that Lazydays wants were made last year.
In the second quarter of 2022, the company netted $31.8 million in profit. In the second quarter 2023, the company netted $3.56 million, an 88.8% decline. Total revenue for the quarter ending June 30 fell to $308.4 million, a 17% drop.
"Obviously, the market dynamics continue to be difficult," North says. "The pandemic pulled forward significant demand. Supply chain pressures resulted in cost inflation across our product lines and led to increases in both invoice and retail price of vehicles, and central bankers' efforts to counteract inflationary pressure through interest rates are now at more than a 20-year high and have affected financing costs and availability."
Lazydays was founded in 1976, and operates 21 locations in the United States. It recently bought retail locations in Arizona and Nevada. The company sold more than 14,000 RVs in 2022, and recorded $1.3 billion in revenue last year.