RumbleOn Announces Full Year 2020 Financial Results

March 15, 2021 7:00 AM EDT
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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--(BUSINESS WIRE)-- 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.

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 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

Reconciliation of Adjusted EBITDA to Net Loss

RumbleOn, Inc.

(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

)

 

Investor Relations:
The Blueshirt Group
Dylan Solomon
investors@rumbleon.com

Source: RumbleOn, Inc



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