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8-K - FORM 8-K - RumbleOn, Inc. | rmbl_8k.htm |
Exhibit 99.1
RumbleOn Announces Full Year 2020 Financial Results
Grew Gross Profit Per Vehicle Sold by 100%
Year-over-Year
Management to host a conference call today, March 15, 2021, at
8:30am ET
DALLAS - RumbleOn, Inc (NASDAQ: RMBL), an e-commerce company using
innovative technology to aggregate and distribute pre-owned
vehicles to and from both consumers and dealers, today announced
financial results for the year ended December 31, 2020.
Management is hosting an investor call to discuss results today,
March 15, 2021 at 8:30am ET.
“Less
than seven months after launching RumbleOn 3.0 its clear the newest
generation of RumbleOn has been a great success,” said
Marshall Chesrown, Chief Executive Officer. “RumbleOn 3.0 has
increased overall listings on RumbleOn.com which has led to an
improvement in gross profit on vehicles sold of more than 100% in
2020 as compared to 2019.”
Chesrown concluded, “The prescriptive steps
we’ve taken to improve margins and expand our offering over
the past year have quickly cemented RumbleOn as a Powersports
leader in the United States.”
Full Year 2020 Financial Highlights
RumbleOn’s decision to focus on profitability in 2020,
combined with the impact of COVID-19 has resulted in significantly
reduced commercial activity and total inventory in the market.
Despite these factors the Company's full year results demonstrate
improvements in margin and EBITDA.
Unless otherwise noted, all comparisons are on a year-over-year
basis for the twelve months ended December 31, 2020.
●
Total vehicle unit sales was 18,024, a decrease from 43,143 in
2019
●
Total revenue was $416.4 million, a decrease from $840.6 million in
2019
°
Powersports revenue was $46.7 million
°
Automotive revenue was $337.1 million
°
Transportation and vehicle logistics revenue was $31.8
million
●
Total gross profit was $31.6 million, or a total gross margin of
7.6%, an increase from 6.0% in 2019
°
Gross margin on vehicles sold (excluding the impairment loss on
automotive inventory) was 9.6%, up from 5.4%. Gross profit per
vehicle was $2,047 per vehicle, a 100.4% increase from
2019
°
Powersports gross profit per powersport vehicle sold was
$1,478
°
Automotive gross profit per automotive vehicle sold was
$2,282
●
Sales, General and Administrative Expenses was $53.7 million, a
decrease from $86.6 million in 2019
°
Compensation expense was $25.7 million
°
Advertising and Marketing expense was $5.3 million
°
Professional fees were $3.2 million
°
Technology development expense was $1.4 million
°
General and Administrative expense was $18.1 million
●
Operating loss was $(18.6) million, an improvement from $(37.8)
million in 2019
●
Net loss was $(25.0) million, an improvement from $(45.2) million
in 2019
●
Adjusted EBITDA was $(5.8) million or (1.4)% of revenue, an
improvement from $(26.4) million or (3.1)% of revenue in
2019
●
Net loss per basic and fully diluted Class B share was $(11.44), an
improvement from $(40.53) in 2019
Adjusted EBITDA is a non-GAAP financial measure. Reconciliations of
non-GAAP financial measures used in this release are provided in
the attached financial tables.
Given
the uncertainty of the ongoing impact and unprecedented conditions
surrounding the COVID-19 pandemic, we cannot predict the overall
effect to RumbleOn, our customers, regional business partners, and
others that we work with.
Conference Call Details
RumbleOn’s
management will host a conference call today, Monday, March 15,
2021 at 8:30 a.m. ET. A live and archived webcast can be accessed
from RumbleOn's Investor Relations website at https://investors.rumbleon.com.
To access the conference call telephonically, callers may dial
(877) 407-9716, or (201) 493-6779 for callers outside of the United
States and entering conference ID 13716962.
About RumbleOn
Founded in 2017, RumbleOn (NASDAQ: RMBL) is an e-commerce company
using innovative technology to aggregate and distribute pre-owned
automotive and powersport vehicles to and from both consumers and
dealers, 100% online. RumbleOn is disrupting the pre-owned vehicle
supply chain by providing dealers with technology solutions such as
virtual inventory, and a 24/7 distribution platform, and consumers
with an efficient, timely and transparent transaction experience,
without leaving home. Whether buying, selling, trading or financing
a vehicle, RumbleOn enables dealers and consumers to transact
without geographic boundaries in a transparent, fast and friction
free experience. For more information, please visit
http://www.rumbleon.com.
Non-GAAP Financial Measures
As required by the rules of the Securities and Exchange Commission
("SEC"), we provide reconciliations of the non-GAAP financial
measures contained in this press release to the most directly
comparable measure under GAAP, which are set forth in the financial
tables attached to this release. Non-GAAP financial measures for
the three and twelve months ended December 31, 2020 used in this
release include: adjusted EBITDA.
Adjusted EBITDA is a non-GAAP financial measure and should not be
considered as an alternative to operating income or net income as a
measure of operating performance or cash flows or as a measure of
liquidity. Non-GAAP financial measures are not necessarily
calculated the same way by different companies and should not be
considered a substitute for or superior to U.S. GAAP.
Adjusted EBITDA is defined as net income or loss adjusted to add
back interest expense including debt extinguishment and
depreciation and amortization, and certain charges and expenses,
such as goodwill impairment, impairment loss on automotive
inventory, impairment loss on plant & equipment, insurance
recovery proceeds, non-cash stock-based compensation, change in
derivative liability, litigation expenses, severance, new business
development and other non-recurring costs, as these charges and
expenses are not considered a part of our core business operations
and are not an indicator of ongoing, future company
performance.
Adjusted EBITDA is one of the primary metrics used by management to
evaluate the financial performance of our business. We present
adjusted EBITDA because we believe it is frequently used by
analysts, investors and other interested parties to evaluate
companies in our industry. Further, we believe it is helpful in
highlighting trends in our operating results, because it excludes,
among other things, certain results of decisions that are outside
the control of management, while other measures can differ
significantly depending on long-term strategic decisions regarding
capital structure and capital investments.
Forward-Looking Statements
This press release may contain "forward-looking statements" as that
term is defined under the Private Securities Litigation Reform Act
of 1995 (PSLRA), which statements may be identified by words such
as "expects," "projects," "will," "may," "anticipates," "believes,"
"should," "intends," "estimates," and other words of similar
meaning. Readers are cautioned not to place undue reliance on these
forward-looking statements, which are based on our expectations as
of the date of this press release and speak only as of the date of
this press release and are advised to consider the factors listed
under the heading "Forward-Looking Statements" and "Risk Factors"
in the Company's SEC filings, as may be updated and amended from
time to time. We undertake no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
Source: RumbleOn, Inc.
Investor Relations:
The Blueshirt Group
Dylan Solomon
investors@rumbleon.com
Consolidated Balance Sheets
December
31, 2020 and 2019
(Unaudited)
|
2020
|
2019
|
ASSETS
|
|
|
Current
assets:
|
|
|
Cash
|
$1,466,831
|
$49,660
|
Restricted
cash
|
2,049,056
|
6,676,622
|
Accounts
receivable, net
|
9,407,960
|
8,482,707
|
Inventory
|
21,360,441
|
57,381,281
|
Prepaid expense and
other current assets
|
3,446,225
|
1,210,474
|
Total current
assets
|
37,730,513
|
73,800,744
|
|
|
|
Property and
equipment, net
|
6,521,446
|
6,427,674
|
Right-of-use
assets
|
5,689,637
|
6,040,287
|
Goodwill
|
26,886,563
|
26,886,563
|
Other
assets
|
151,076
|
237,823
|
Total
assets
|
$76,979,235
|
$113,393,091
|
|
|
|
LIABILITIES AND
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
Accounts payable
and accrued liabilities
|
$12,707,448
|
$12,421,094
|
Accrued interest
payable
|
1,485,854
|
749,305
|
Current portion of
convertible debt, net
|
562,502
|
1,363,590
|
Current portion of
long-term debt
|
20,688,651
|
59,160,970
|
Total current
liabilities
|
35,444,455
|
73,694,959
|
|
|
|
Long -term
liabilities:
|
|
|
Notes
payable
|
4,691,181
|
1,924,733
|
Convertible debt,
net
|
27,166,019
|
20,136,229
|
Derivative
liabilities
|
16,694
|
27,500
|
Operating
lease liabilities and other long-term liabilities
|
5,090,221
|
4,722,101
|
Total long-term
liabilities
|
36,526,615
|
26,810,563
|
Total
liabilities
|
71,408,570
|
100,505,522
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
Class B Preferred stock, $0.001 par value,
10,000,000 shares authorized, no shares issued and outstanding as of December 31,
2020 and 2019, respectively
|
-
|
-
|
Common A stock,
$0.001 par value, 50,000 shares authorized, 50,000 shares issued
and outstanding as of December 31, 2020 and 2019,
respectively
|
50
|
50
|
Common B stock, $0.001 par value, 4,950,000
shares authorized, 2,191,633 and 1,111,681 shares issued and outstanding as of
December 31, 2020 and 2019, respectively
|
2,192
|
1,112
|
Additional paid in
capital
|
108,949,204
|
92,268,213
|
Accumulated
deficit
|
(104,380,781)
|
(79,381,806)
|
Total
stockholders'
equity
|
4,570,665
|
12,887,569
|
|
|
|
Total liabilities
and stockholders'
equity
|
$76,979,235
|
$113,393,091
|
Consolidated Statements of Operations
For the
Years Ended December 31, 2020 and 2019
(Unaudited)
|
2020
|
2019
|
Revenue:
|
|
|
Pre-owned Vehicle
Sales:
|
|
|
Powersports
|
$46,653,668
|
$101,008,976
|
Automotive
|
337,084,959
|
717,042,511
|
Transportation and
vehicle logistics
|
31,816,157
|
22,577,860
|
Other
|
872,459
|
-
|
Total
revenue
|
416,427,243
|
840,629,347
|
|
|
|
Cost of
revenue:
|
|
|
Powersports
|
40,060,571
|
88,673,515
|
Automotive
|
308,800,631
|
685,313,894
|
Transportation and
vehicle logistics
|
24,200,229
|
16,023,962
|
Cost of revenue
before impairment loss
|
373,061,431
|
790,011,371
|
Impairment loss on
automotive inventory
|
11,738,413
|
-
|
Total cost of
revenue
|
384,799,844
|
790,011,371
|
|
|
|
Gross
profit
|
31,627,399
|
50,617,976
|
|
|
|
Selling, general
and administrative
|
53,659,348
|
86,624,249
|
|
|
|
Insurance recovery
proceeds
|
(5,615,268)
|
-
|
|
|
|
Depreciation and
amortization
|
2,142,939
|
1,786,426
|
|
|
|
Operating
loss
|
(18,559,620)
|
(37,792,699)
|
|
|
|
Interest
expense
|
(6,638,325)
|
(7,187,604)
|
Decrease in
derivative liability
|
10,806
|
1,302,500
|
Gain (loss) on
early extinguishment of debt
|
188,164
|
(1,499,250)
|
Net loss before
provision for income taxes
|
(24,998,975)
|
(45,177,053)
|
|
|
|
Benefit for income
taxes
|
-
|
-
|
|
|
|
Net
loss
|
$(24,998,975)
|
$(45,177,053)
|
|
|
|
Weighted average
number of common shares outstanding - basic and fully
diluted
|
2,184,441
|
1,114,714
|
|
|
|
Net loss per share
- basic and fully diluted
|
$(11.44)
|
$(40.53)
|
Consolidated Statements of Cash Flows
For the
Two Years Ended December 31, 2020 and 2019
(Unaudited)
|
2020
|
2019
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
Net
loss
|
$(24,998,975)
|
$(45,177,053)
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
Depreciation and
amortization
|
2,142,939
|
1,786,426
|
Amortization of
debt discount
|
2,027,046
|
1,664,000
|
Bad debt
expense
|
310,721
|
1,123,739
|
Stock based
compensation expense
|
2,978,236
|
3,836,518
|
Impairment loss on
inventory
|
11,738,413
|
-
|
Impairment loss on
property and equipment
|
177,626
|
-
|
(Gain) from change
in value of derivative liability
|
(10,806)
|
(1,302,500)
|
Loss from
extinguishment of debt
|
(188,164)
|
1,499,250
|
Goodwill
impairment
|
-
|
1,850,000
|
Changes in
operating assets and liabilities:
|
|
|
Decrease (increase)
in accounts receivable
|
(1,235,974)
|
2,037,023
|
(Increase) decrease
in inventory
|
24,282,427
|
(2,327,754)
|
(Increase) in
prepaid expenses and other current assets
|
(2,235,751)
|
(113,529)
|
(Increase) decrease
in other assets
|
86,747
|
(135,645)
|
Increase in other
liabilities
|
720,067
|
-
|
(Decrease) increase
in accounts payable and accrued liabilities
|
152,126
|
(5,031,073)
|
Increase in accrued
interest payable
|
1,196,549
|
543,268
|
Net cash provided
by (used in) operating activities
|
17,143,227
|
(39,747,330)
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
Net cash used for
acquisitions
|
-
|
(835,000)
|
Proceeds from sales
of property and equipment
|
38,436
|
169,268
|
Technology
development
|
(2,145,055)
|
(3,085,743)
|
Purchase of
property and equipment
|
(174,786)
|
(119,748)
|
Net cash used in
investing activities
|
(2,281,405)
|
(3,871,223)
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
Proceeds from notes
payable and convertible debt
|
8,272,375
|
27,455,537
|
Repayments for
notes payable
|
(1,767,758)
|
(10,857,500)
|
Net proceeds from
(payments on) lines of credit
|
(40,533,759)
|
2,788,469
|
Proceeds from PPP
Loan
|
5,176,845
|
-
|
Proceeds from sale
of common stock
|
10,780,080
|
15,173,427
|
Net cash provided
by (used in) financing activities
|
(18,072,217)
|
34,559,933
|
|
|
|
NET CHANGE IN
CASH
|
(3,210,395)
|
(9,058,620)
|
|
|
|
CASH AND RESTRICTED
CASH AT BEGINNING OF PERIOD
|
6,726,282
|
15,784,902
|
|
|
|
CASH AND RESTRICTED
CASH AT END OF PERIOD
|
$3,515,887
|
$6,726,282
|
Reconciliation of Non-GAAP Measures
RumbleOn, Inc.
Reconciliation of Adjusted EBITDA to Net Loss
(Unaudited)
|
2020
|
2019
|
Net
loss
|
$(24,998,975)
|
$(45,177,053)
|
Add
back:
|
|
|
Interest expense
(including debt extinguishment)
|
6,450,161
|
8,686,854
|
Depreciation and
amortization
|
2,142,939
|
1,786,426
|
EBITDA
|
(16,405,875)
|
(34,703,773)
|
Adjustments
|
|
|
Goodwill
impairment
|
|
1,850,000
|
Impairment loss on
automotive inventory
|
11,738,413
|
-
|
Impairment loss on
plant & equipment
|
177,626
|
-
|
Insurance recovery
proceeds
|
(5,615,268)
|
-
|
Non-cash
stock-based compensation
|
2,978,236
|
3,836,518
|
Change in
derivative liability
|
(10,806)
|
(1,302,500)
|
Litigation
expenses
|
1,295,717
|
61,446
|
Severance
|
-
|
1,079,438
|
New business
development
|
-
|
1,224,523
|
Other Non-recurring
costs
|
51,387
|
1,578,220
|
Adjusted
EBITDA
|
$(5,790,570)
|
$(26,376,128)
|