Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| Statement |
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| We have also seen month-on-month improvement in operations each month from January through April |
| I'm also quite happy with the velocity of our unit sales volume which has been the most resilient part of our performance in the first quarter despite macroeconomic headwinds |
| And so, I would say generally speaking the velocity of our used unit sales has been improving |
| I think we're seeing pretty good unit velocity |
| I'm enthusiastic about the future of our company as we expand our digital presence and advance our marketing strategies with Jake on board |
| And I think what we've seen is that there's really healthy demand for use particularly with interest rates being up and just with cost inflation in general on new product, which I don't think is unique to our industry, but we've certainly seen that |
| But generally speaking there's really good demand for used |
| Our first quarter results have shown sequential improvement from the fourth quarter of last year in terms of overall revenue, fewer poll sales, lower adjusted SG&A to growth and growth in our service, body and parts business |
| Furthermore, we are still generating healthy profits in 2023 and some 2024 units that have recently arrived |
| So I think we're doing the best we can and our expectations are that hopefully as things warm up particularly in the Midwest we'll see some nice seasonal growth |
| And we are optimistic about our future performance |
| Our service spotting and parts business continues to grow with revenue increasing 6.3% to $15 million |
| I think in terms of the Q1 cadence and into April it got better sequentially and I would say March was significantly better than January and February |
| We continue to make exciting strides in corporate development |
| Nevertheless, I'm impressed with how we have responded from our store leaders and field personnel to the team here at our headquarters, everyone has risen to the occasion making a significant impact |
| Finally, I want to express my gratitude to our organization for their exceptional work during the past few months |
| While it's impossible to predict exactly where the market will go in the balance of the year, we remain committed to improving our operations and profitability |
| We continue to see overall F&I product penetration as a significant opportunity in our stores |
| We have more work to do but I am encouraged by the hard work the team has put in to control costs |
| So we are pleased that the worst is behind us |
| We're seeing good grosses on the 23s yet so |
| But so far, so good |
| Total SG&A as a percentage of gross profit in the quarter was 82%, excluding the impact of LIFO and adjusted SG&A for the quarter was 79% of sequential improvement from the fourth quarter of 2022 |
| I'm honored to be a part of such an energetic and capable organization |
| And I sincerely thank each and every one of our fantastic employees |
| And so there's still room to make some nice margin there |
| I think the 23s are still bringing pretty good money |
| And I agree 100%, with that notion, and I think we're, as an organization trying to do more there and think that there's opportunity for us to potentially find additional revenue there if we can source units |
| Alongside our physical expansion, we are also prioritizing the development of our digital capabilities to enhance the customer experience and promote growth |
| And we have some really good partners |
| Statement |
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| Total revenue was $295.7 million, a decrease of 21.4% reflecting a continued softening of sales volumes in the quarter and discounting of our 2022 model year inventory |
| Finance and insurance revenue declined 25.4% during the quarter, primarily as a result of declines in unit volume combined with lower financing penetration |
| Adjusted net income was $1.2 million for the quarter down from $28.2 million last year |
| New unit sales declined 18.9% in the quarter and gross profit per unit excluding LIFO declined 38.6% to $12,132 per unit |
| Used unit sales excluding wholesale units declined 15.6% and gross profit per unit declined 30% to $13,359 per unit |
| F&I per unit was $5,007 for the quarter a decrease of 10.4% |
| It has been a challenging period as we had to make tough decisions about people and projects and we need to accomplish more with fewer resources |
| And so I think that slowed things down a bit too |
| You'll see a pretty significant reduction in our wholesale volume in the first quarter |
| And we see something significantly lower than that |
| As of today, we only have around 400 units left from the 2022 model year, although gross profit dollars on 2022 units have been deteriorating sequentially each month for the last three quarters the small number of units remaining relative to overall sales will inflect to make up a smaller contribution causing overall gross margin on new unit sales to stabilize |
| But the last couple of years have been unusual |
| Of course this year has been different with the collapse of both Silicon Valley and Signature Bank, having experienced the great financial crisis of 2008 at Lithia and the COVID-19 pandemic at Avis |
| And so I think it'll be manageable and nothing to date that would cause me any real concern |
| And more than that in March so our data supply came down quite a bit, because the sales velocity is kind of on the new side, and we went from 277 to 205 or something, it’s a pretty significant change in terms of days supply |
| You just didn't have that shock and supply that came in last summer, that really, I think made the dealer body too heavy in terms of 2022 model year for the sales velocity |
| As John mentioned, we've seen minimal impacts from the increase in interest rates and turmoil in the banking sector |
| Curious on inventory mix |
| After accounting for the dividend adjusted net income was breakeven resulting in zero adjusted earnings per share for the quarter |
| Curious on the floorplan side, there's been several high profile lenders exiting idle, floorplan financing |
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