Please replace the release with the following corrected version
that has been amended and restated to clarify that our 2022
guidance is based on a comparison to 2021 pro forma results.
The updated release reads:
1847 GOEDEKER INC. ANNOUNCES FOURTH QUARTER
AND FULL YEAR FISCAL 2021 RESULTS
Achieved Net Sales of $362.3 Million and Pro
Forma Net Sales of $541.7 Million for Fiscal Year
Guides High Teens to Low Twenties 2022 Sales
Growth relative to 2021 pro forma sales, with Gross Margins and
Adjusted EBITDA Relatively in Line with Management’s 2021
Outlook
1847 Goedeker Inc. (NYSE American: GOED) ("Goedeker" or the
"Company"), a content driven and technology enabled shopping
destination for appliances, furniture and home goods in the U.S.
household appliances market, today reported financial results,
including GAAP and pro forma financial results, for the fourth
quarter and full-year ended December 31, 2021. 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.
GAAP Financial
Highlights
FOURTH QUARTER
- Net sales were $142.7 million, compared to $16.7 million for
the fourth quarter 2020.
- Gross profit was $32.6 million (23% margin), compared to $0.9
million for the fourth quarter 2020.
- Net income was $3.8 million compared to a loss of $9.7 million
for the fourth quarter 2020.
FULL YEAR
- Net sales were $362.3 million, compared to $55.1 million for
2020.
- Gross profit was $79.6 million, compared to $7.3 million for
2020.
- Net income was $7.7 million compared to a net loss of $21.6
million for 2020.
- Cash and cash equivalents were $25.7 million as of December 31,
2021, excluding $8.1 million in restricted cash.
Pro forma Financial
Highlights1
FOURTH QUARTER
- Net sales were $142.7 million, compared to pro forma net sales
of $107.9 million for the fourth quarter 2020.
- Gross profit was $32.6 million (23% margin), compared to pro
forma gross profit of $20.2 million (18.8% margin) for the fourth
quarter 2020.
- Net income was $3.8 million, or $0.03 per diluted common share,
compared to a pro forma loss of $6.9 million, or -$0.07 per diluted
common share, for the fourth quarter 2020.
- Adjusted EBITDA was $11.3 million (8% margin).
FULL YEAR
- Pro forma net sales were $541.7 million, compared to pro forma
net sales of $370.1 million for 2020.
- Pro forma gross profit was $126.0 million (23.3% margin),
compared to pro forma gross profit of $73.0 million (19.7% margin)
for 2020.
- Pro forma net income was $28 million, or $0.17 per diluted
common share, compared to a net loss of $11.2 million, or -$0.11
per diluted common share, for 2020.
- Pro forma adjusted EBITDA was $48.7 million (9.0% margin).
Business and Strategy Highlights
Albert Fouerti, Chief Executive Officer and Director,
commented:
“The past year was a period of significant change and
transformation – one that was compounded by a lingering pandemic
and persistent supply chain issues. Amidst this difficult backdrop,
I am pleased that we were still able achieve significant growth and
maintain strong margins. We did this while also starting to rebuild
our leadership team, improve technology, strengthen supply chain
and logistics capabilities, and overhaul other business and finance
areas. We will continue to pursue profitable growth in the year
ahead while looking for ways to optimize our infrastructure, talent
and capital structure. I believe 2022 will be an important stepping
stone on the road to long-term growth and our long-term goal to
achieve a billion dollars in annual sales.”
In recent months, the Company has made progress against the
priorities outlined by new management:
- Strengthening the Company’s Leadership Team – We have
made several c-level and senior hires while phasing out individuals
with redundant or inapplicable skills more aligned to the legacy
Goedeker business. The Company has added new executives with
decades of experience in supply chain, distribution and logistics,
ecommerce and marketing that are aligned with its mission and
long-term vision. Moving forward, recruiting top-tier talent at all
levels remains a major priority.
- Establishing Deeper Connectivity with Customers – We
created even deeper relationships with our customers throughout the
last fiscal year. We experienced more than 30 million annual
website visits compared to 10 million site visits in 2020, made
more than 450,000 white glove deliveries and now have more than
670,000 product reviews and expert how-to’s on our website. This
resulted in a 53% customer retention rate, a figure management
intends to build on.
- Refining Fulfillment Network Expansion – We made
progress in the early stages of our fulfillment network expansion.
We have identified the geographic areas we want to be in to get
closer to the customer and further penetrate markets that are
experiencing the highest levels of housing development and home
remodeling. Although we currently are holding off on entering into
agreements due to inventory and supply chain issues, we expect to
add at least two new fulfillment centers over the next year.
Management expects these additions to support long-term growth
without margin degradation.
- Advancing the Rebrand – The Company has completed
significant work with its branding partner, and is on track to
announce a new name and brand ethos in the first half of this
fiscal year. These will align with our vision to become a home and
appliances platform that empowers customers throughout the entire
purchasing journey – from inspiration to installation. We are in
the process of enhancing the content and resources available on our
site that will ultimately help us create more meaningful
relationships with customers.
- Laying the Foundation for B2B Growth – We currently have
$20 million of new business-to-business projects in the pipeline as
of the first quarter of 2022 and are working to build on this
pipeline throughout the remainder of the year. We expect that these
will be longer term projects that may take 6-18 months to come to
fruition, but we believe this pipeline will materialize into more
significant revenue growth over time.
Outlook
Management’s outlook for Fiscal 2022 includes high teens to low
20s sales growth compared to 2021 pro forma sales with gross
margins and adjusted EBITDA margins relatively in line with our
2021 outlook. Management expects that the combination of sustained
supply chain disruptions, significant inflation and geopolitical
uncertainty will impact the Company and its customer base in the
coming quarters. This expectation has informed the Company’s Fiscal
2022 outlook.
Investor Conference Call
The Company will host an investor conference call at 8:00 a.m.
ET today to review its results. The phone number for the investor
conference call is 1-844-881-0136 (toll-free) or 1-412-902-6507
(international); please ask to join the Goedeker Q4 2021 Earnings
Call. The investor presentation for the call can be accessed on our
investor relations site at http://investor.goedekers.com.
About Goedeker
Goedeker is a content-driven and technology-enabled shopping
destination for appliances, furniture and home goods. Since its
acquisition of Appliances Connection, Goedeker has evolved into a
growth-oriented ecommerce platform with a distinct offering of
core, premium, luxury and private label brands that can be accessed
through a convenient point-and-click experience. The Company's
priorities include offering an expansive selection, high-touch
product expertise and reliable shipping from its expanding,
nationwide fulfillment network. 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 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. You should not
place undue reliance on forward-looking statements because they
involve known and unknown risks, uncertainties and other factors,
which are, in some cases, beyond the Company’s control and which
could materially affect results. Factors that may cause actual
results to differ materially from current expectations include,
among other things, those described more fully in the section
titled "Risk Factors" of the Company’s Annual Report on Form 10-K
for the year ended December 31, 2021, filed with the Securities and
Exchange Commission. 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.
Non-GAAP Financial
Measures
The Company's audited consolidated financial statements and
unaudited condensed consolidated financial statements are prepared
in accordance with accounting principles generally accepted in the
United States ("GAAP"). The Company also provides financial
information in this release that was not prepared in accordance
with GAAP and should not be considered as an alternative to the
information prepared in accordance with GAAP. 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 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 calculated in
accordance with GAAP and should not be considered an alternative to
any financial measure that was calculated under 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
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
Pro Forma2 For the Year
Ended
December 31, 2021 December 31, 2021** NET INCOME $
3.8
$
27.9
ADJUSTMENTS Income taxes
1.5
(1.5
)
Depreciation and amortization
2.7
10.9
Financing costs
0.2
0.5
Interest expense
1.1
3.5
EBITDA
9.3
41.3
Loss on extinguishment of debt
-
1.7
Loss on abandonment of Right of Use asset
-
1.4
Other one-time adjustments*
1.7
3.2
Severance expense
0.3
1.1
ADJUSTED EBITDA $
11.3
$
48.7
* One-time adjustments mainly include expenses related to the
acquisition, proxy contest and other costs not related to our
onging operating results **Full year proforma results adjusted for
the Opening Balance Sheet audit adjustments
1 2021 pro forma information gives effect to the Appliances
Connection and other material transactions as though they were
completed on January 1, 2021. 2020 pro forma information gives
effect to the Appliances Connection and other material transactions
as though they were completed on January 1, 2020.
2 2021 pro forma information gives effect to the Appliances
Connection and other material transactions as though they were
completed on January 1, 2021.
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version on businesswire.com: https://www.businesswire.com/news/home/20220331005435/en/
Goedeker Investor Relations Greg Marose / Ashley Areopagita
ir@goedekers.com
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