Item 5. Market for Registrant’s Common Equity
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market Information
Our Class A common stock is traded on the New York Stock Exchange under the symbol “CWH.” There is no public trading market for our Class B common stock and Class C common stock.
Holders of Record
As of February 12, 2021, there were 5 and 41,329 stockholders of record and beneficial holders, respectively, of our Class A common stock. As of February 15, 2021, there were two and one stockholders of record of our Class B common stock and Class C common stock, respectively.
Dividend Policy
CWGS, LLC has made a regular quarterly cash distribution to its common unit holders of approximately $0.08 per common unit between the three months ended December 31, 2016 and the three months ended June 30, 2020. On July 20, 2020, our Board of Directors approved the increase of the quarterly dividend to $0.09 per share of Class A common stock from $0.08 per share. Accordingly, during the three months ended September 30, 2020 and December 31, 2020, we paid regular quarterly cash dividends of $0.09 per share of our Class A common stock. CWGS, LLC intends to continue to make such quarterly cash distributions, to the extent permitted by law. We have used in the past, and intend to continue to use, to the extent permitted by law, all of the proceeds from such distribution on our common units to pay a regular quarterly cash dividend of approximately $0.09 per share on our Class A common stock, subject to our discretion as the sole managing member of CWGS, LLC and the discretion of our board of directors. CWGS, LLC is required to make cash distributions in accordance with the CWGS LLC Agreement in an amount sufficient for us to pay any expenses incurred by us in connection with the regular quarterly cash dividend, along with any of our other operating expenses and other obligations. Holders of our Class B common stock and Class C common stock are not entitled to participate in any dividends declared by our board of directors. We believe that our cash and cash equivalents and cash provided by operating activities will be sufficient for CWGS, LLC to make this regular quarterly cash distribution for at least the next twelve months.
In addition, the CWGS LLC Agreement requires tax distributions to be made by CWGS, LLC to its members, including us. In general, tax distributions are made on a quarterly basis, to each member of CWGS, LLC, including us, based on such member's allocable share of the taxable income of CWGS, LLC (which, in our case, will be determined without regard to any Basis Adjustments described in our Tax Receivable Agreement) and an assumed tax rate based on the highest combined federal, state, and local tax rate that may potentially apply to any one of CWGS, LLC's members (46.70% in 2020, 2019 and 2018), regardless of the actual final tax liability of any such member. Based on the current applicable effective tax rates, we expect that (i) the assumed tax rate that will be used for purposes of determining tax distributions from CWGS, LLC will exceed our actual combined federal, state and local tax rate (assuming no changes in corporate tax rates) and (ii) the annual amount of tax distributions paid to us will exceed the sum of (A) our actual annual tax liability and (B) the annual amount payable by us under the Tax Receivable Agreement (assuming no early termination of the Tax Receivable Agreement) (such excess in clauses (A) and (B), collectively referred to herein as the "Excess Tax Distribution"). We currently intend to pay a special cash dividend of all or a portion of the Excess Tax Distribution to the holders of our Class A common stock from time to time subject to the discretion of our board of directors.
Our ability to pay cash dividends on our Class A common stock depends on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements and in any preferred stock, restrictions under applicable law, the extent to which such distributions would render CWGS, LLC insolvent, our business prospects and other factors that our
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board of directors may deem relevant. Additionally, our ability to distribute any Excess Tax Distribution will also be contingent on no early termination or amendment of the Tax Receivable Agreement, as well as the amount of tax distributions actually paid to us and our actual tax liability. Furthermore, because we are a holding company, our ability to pay cash dividends on our Class A common stock depends on our receipt of cash distributions from CWGS, LLC and, through CWGS, LLC, cash distributions and dividends from its operating subsidiaries, which may further restrict our ability to pay dividends as a result of the laws of their jurisdiction of organization, agreements of our subsidiaries or covenants under any existing and future outstanding indebtedness we or our subsidiaries incur. In particular, our ability to pay any cash dividends on our Class A common stock is limited by restrictions on the ability of CWGS, LLC and our other subsidiaries and us to pay dividends or make distributions to us under the terms of our Senior Secured Credit Facilities and Floor Plan Facility. We do not currently believe that the restrictions contained in our existing indebtedness will impair the ability of CWGS, LLC to make the distributions or pay the dividends as described above. Our dividend policy has certain risks and limitations, particularly with respect to liquidity, and we may not pay future dividends according to our policy, or at all. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources" and "Risk Factors—Risks Relating to Ownership of Our Class A Common Stock—Our ability to pay regular and special dividends on our Class A common stock is subject to the discretion of our board of directors and may be limited by our structure and statutory restrictions” in this Form 10-K.
Issuer Purchases of Equity Securities
The following table presents information related to our repurchases of Class A common stock for the periods indicated:
Period
Total Number of Shares Purchased
Average Price Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Programs (1)
Approximate Dollar Value of Shares that May Yet Be Purchased Under the Programs
October 1, 2020 to October 31, 2020
—
$—
—
$100,000,000
November 1, 2020 to November 30, 2020
811,223
26.53
811,223
78,478,000
December 1, 2020 to December 31, 2020
—
—
—
78,478,000
Total
811,223
$26.53
811,223
$78,478,000
(1) On October 30, 2020, our Board of Directors authorized a stock repurchase program for the repurchase of up to $100.0 million of the Company’s Class A common stock, expiring on October 31, 2022. This program does not obligate the Company to acquire any particular amount of Class A common stock and the program may be extended, modified, suspended or discontinued at any time at the Board’s discretion.
The table above excludes shares net settled by the Company in connection with tax withholdings associated with the vesting of restricted stock units as these shares were not issued and outstanding.
Stock Performance Graph
The following graph and table illustrate the total return from October 7, 2016, the date our shares began trading on the NYSE, through December 31, 2020, for (i) our Class A common stock, (ii) the Standard and Poor’s (“S&P”) 500 Index, and (iii) the S&P 500 Retailing Index. The comparisons reflected in the graph and table are not intended to forecast the future performance of our stock and may not be indicative of future
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performance. The graph and table assume that $100 was invested on October 7, 2016 in each of our Class A common stock, the S&P 500 Index, and S&P 500 Retailing Index and that any dividends were reinvested.
October 7,
December 31,
December 31,
December 31,
December 31,
December 31,
2016
2016
2017
2018
2019
2020
Camping World Holdings, Inc. Class A common stock
$
100.00
$
145.27
$
203.35
$
53.65
$
72.63
$
137.63
S&P 500 Index
$
100.00
$
104.45
$
127.26
$
121.68
$
159.99
$
189.43
S&P 500 Retailing Index
$
100.00
$
98.91
$
128.98
$
146.34
$
185.38
$
271.42
Recent Sales of Unregistered Securities
None.
ITEM 6. SELECTED FINANCIAL DATA
The following tables present the selected historical consolidated financial and other data for Camping World Holdings, Inc. The selected consolidated balance sheets data as of December 31, 2020 and 2019 and the selected consolidated statements of operations and statements of cash flows data for each of the years in the three-year period ended December 31, 2020 are derived from our audited consolidated financial statements contained in Part II, Item 8 of this Form 10-K. The selected consolidated balance sheets data as of December 31, 2018, 2017 and 2016, and the selected consolidated statements of operations and statements of cash flows data for the year ended December 31, 2017 and 2016 have been derived from our audited consolidated financial statements not included herein.
During the year ended December 31, 2019, we had a change to our reportable segments as described in Note 22 — Segment Information in Part II, Item 8 of this Form 10-K. Accordingly, certain components of revenue and gross profit for the years ended December 31, 2018, 2017 and 2016 have been reclassified to conform to our current segment reporting structure.
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Our financial statements for the year ended December 31, 2017 reflect the provisional impact of the U.S. Tax Cuts and Jobs Act of 2017 that significantly revised the U.S. corporate income tax by, among other things, lowering the statutory corporate tax rate from 35% to 21% and eliminating certain deductions.
Our financial statements for the year ended December 31, 2018 reflect the adoption of Accounting Standards Codification (“ASC”) No. 606, Revenue from Contracts with Customers as described in Note 2 — Revenue in Part II, Item 8 of this Form 10-K, which also removed the guidance for capitalization of direct response advertising that is now expensed as incurred.
Our financial statements for the year ended December 31, 2019 reflect the adoption of ASC No. 842, Leases as described in Note 1 — Summary of Significant Accounting Policies — Recently Adopted Accounting Pronouncements in Part II, Item 8 of this Form 10-K. Additionally, our financial statements for the year ended December 31, 2019 reflect long-lived asset impairments and restructuring charges as described in Note 5 — Restructuring and Long-lived Asset Impairment in Part II, Item 8 of this Form 10-K.
Subsequent to the IPO and the related reorganization transactions, Camping World Holdings, Inc. has been a holding company whose principal asset is its equity interest in CWGS, LLC. As the sole managing member of CWGS, LLC, Camping World Holdings, Inc. operates and controls all of the business and affairs of CWGS, LLC, and, through CWGS, LLC, conducts its business. As a result, the Company consolidates CWGS, LLC’s financial results and reports a non-controlling interest related to the common units not owned by Camping World Holdings, Inc. Such consolidation has been reflected for all periods presented. Our selected historical consolidated financial and other data does not reflect what our financial position, results of operations and cash flows would have been had we been a separate, stand-alone public company during those periods.
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Our selected historical consolidated financial and other data may not be indicative of our future results of operations or future cash flows. You should read the information set forth below in conjunction with our historical consolidated financial statements and the notes to those statements, “Item 1A. – Risk Factors,” and “Item 7. – Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Form 10-K.
Fiscal Year Ended
December 31,
December 31,
December 31,
December 31,
December 31,
($ in thousands)
2020
2019
2018
2017
2016
Consolidated Statements of Operations Data:
Revenue:
Good Sam Services and Plans
$
180,977
$
179,538
$
172,660
$
161,888
$
152,778
RV and Outdoor Retail
New vehicles
2,823,311
2,370,321
2,512,854
2,435,928
1,862,195
Used vehicles
984,853
857,628
732,017
668,860
703,326
Products, service and other
948,890
1,034,577
949,383
652,819
540,019
Finance and insurance, net
464,261
401,302
383,711
326,609
225,994
Good Sam Club
44,299
48,653
41,392
33,726
31,995
Subtotal
5,265,614
4,712,481
4,619,357
4,117,942
3,363,529
Total revenue
5,446,591
4,892,019
4,792,017
4,279,830
3,516,307
Gross profit:
Good Sam Services and Plans
108,039
101,484
96,619
88,269
82,611
RV and Outdoor Retail
New vehicles
502,774
296,051
324,119
349,699
265,332
Used vehicles
233,824
178,988
163,617
162,767
146,073
Products, service and other
358,174
271,658
364,120
288,047
250,833
Finance and insurance, net
464,261
401,302
383,711
326,609
225,994
Good Sam Club
35,407
37,915
30,746
25,523
22,890
Subtotal
1,594,440
1,185,914
1,266,313
1,152,645
911,122
Total gross profit
1,702,479
1,287,398
1,362,932
1,240,914
993,733
Operating expenses:
Selling, general and administrative
1,156,071
1,141,643
1,069,359
853,160
691,884
Debt restructure expense
—
—
380
387
1,218
Depreciation and amortization
51,981
59,932
49,322
31,545
24,695
Goodwill impairment
—
—
40,046
—
Long-lived asset impairment
12,353
66,270
—
—
—
Lease termination
4,547
(686)
—
—
—
Loss (gain) on disposal of assets
1,332
11,492
2,810
(133)
(564)
Total operating expenses
1,226,284
1,278,651
1,161,917
884,959
717,233
Operating income
476,195
8,747
201,015
355,955
276,500
Other income (expense):
Floor plan interest expense
(19,689)
(40,108)
(38,315)
(27,690)
(18,854)
Other interest expense, net
(54,689)
(69,363)
(63,329)
(42,959)
(48,318)
Loss on debt restructure
—
—
(1,676)
(462)
(5,052)
Tax Receivable Agreement liability adjustment
141
10,005
(1,324)
100,758
—
Total other income (expense)
(74,237)
(99,466)
(104,644)
29,647
(72,224)
Income (loss) before income taxes
401,958
(90,719)
96,371
385,602
204,276
Income tax expense
(57,743)
(29,582)
(30,790)
(154,910)
(5,800)
Net income (loss)
344,215
(120,301)
65,581
230,692
198,476
Less: net (income) loss attributable to non-controlling interests
(221,870)
59,710
(55,183)
(200,839)
(9,591)
Net income (loss) attributable to Camping World Holdings, Inc.
$
122,345
$
(60,591)
$
10,398
$
29,853
$
188,885
Earnings per share of Class A common stock (1):
Basic
$
3.11
$
(1.62)
$
0.28
$
1.12
$
0.08
Diluted
$
3.09
$
(1.62)
$
0.28
$
1.12
$
0.07
Cash dividends declared per share of Class A common stock
$
1.47
$
0.61
$
0.61
$
0.74
$
0.08
Consolidated Statements of Cash Flows Data:
Net cash provided by (used in) operating activities
747,669
251,934
136,292
(16,315)
215,775
Net cash used in investing activities
(125,935)
(104,537)
(292,689)
(468,455)
(115,787)
Net cash (used in) provided by financing activities
(603,183)
(138,433)
70,791
594,737
(77,817)
Selected Other Data:
EBITDA (2)
508,628
38,576
209,022
460,106
277,289
Adjusted EBITDA (2)
564,989
166,015
312,502
394,187
286,467
Net income (loss) margin
6.3%
(2.5)%
1.4%
5.4%
5.6%
Adjusted EBITDA Margin (2)
10.4%
3.4%
6.5%
9.2%
8.1%
Selected Other Operating Data:
Active Customers (3)
5,314,104
5,118,413
5,051,439
3,637,195
3,344,959
Dealership locations (4)
160
154
141
124
105
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Fiscal Year Ended
December 31,
December 31,
December 31,
December 31,
December 31,
($ in thousands)
2020
2019
2018
2017
2016
Consolidated Balance Sheets Data (at period end):
Cash and cash equivalents
$
166,072
$
147,521
$
138,557
$
224,163
$
114,196
Total assets
3,256,431
3,376,240
2,806,687
2,567,026
1,456,061
Total debt (5)
1,185,716
1,208,521
1,204,604
916,902
626,753
Total noncurrent liabilities
2,230,141
2,239,522
1,468,652
1,164,129
740,921
Total stockholders' equity (deficit)
(9,231)
(159,236)
32,917
71,763
(161,007)
(1) Basic and diluted earnings per Class A common stock is applicable only for periods after the Company’s IPO. Prior to the IPO, the CWGS, LLC membership structure included membership units, preferred units, and profits units. During the period of September 30, 2014 to October 6, 2016, there were 70,000 preferred units outstanding that received a total preferred return of $2.1 million per quarter in addition to their proportionate share of distributions made to all members of CWGS, LLC. The Company analyzed the calculation of earnings per unit for periods prior to the IPO using the two-class method and determined that it resulted in values that would not be meaningful to the users of these consolidated financial statements. Therefore, earnings per share information has not been presented for periods prior to the IPO on October 6, 2016. The basic and diluted earnings per share period for the year ended December 31, 2016 represents only the period of October 6, 2016 to December 31, 2016. See Note 21 — Earnings Per Share to our audited consolidated financial statements included in Part II, Item 8 of this Form 10-K for additional information.
(2) EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin are supplemental measures of our performance that are not required by, or presented in accordance with, GAAP. EBITDA, Adjusted EBITDA, and Adjusted EBITDA Margin are not measurements of our financial performance under GAAP and should not be considered as an alternative to net income, net income margin, or any other performance measure derived in accordance with GAAP, or as an alternative to cash flows from operating activities as a measure of our liquidity. See “Non-GAAP Financial Measures” in Part II, Item 7 of this Form 10-K for additional information and a reconciliation to the most directly comparable GAAP financial measure.
(3) We define an “Active Customer” as a unique customer who has transacted with us in any of the eight most recently completed fiscal quarters prior to the date of measurement.
(4) Dealership location acquisitions have contributed to the growth in revenues. See Note 15 — Acquisitions to our audited consolidated financial statements included in Part II, Item 8 of this Form 10-K for additional information.
(5) Total debt consists of borrowings under our Senior Secured Credit Facilities, finance leases, the Company’s prior credit facilities, the revolving line of credit under our Floor Plan Facility, and the Real Estate Facility with CIBC Bank USA, as applicable, net of unamortized original issue discount and capitalized finance costs as of December 31, 2020, 2019, 2018, 2017 and 2016 of $3.2 million and $7.9 million, $4.3 million and $10.9 million, $5.4 million and $13.6 million, $6.0 million and $14.2 million, and $6.3 million and $11.9 million, respectively (as discussed under “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” in Part II, Item 7 of this Form 10-K). See our consolidated financial statements included in Part II, Item 8 of this Form 10-K, which include all liabilities, including amounts outstanding under our Floor Plan Facility .
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