LMP Automotive Holdings, Inc. Announces First Quarter Financial Results And Provides Second Quarter Internal Outlook

First Quarter 2021 Highlights
All financial comparisons stated below are versus Q-1 2020, unless otherwise noted.

  • Revenue increased $27.7M to $33.0M
  • Overall Gross Profit increased by $5.5M to $6.0M
  • Gross Profit Margin increased by 8.9% to 18.2%
  • Adjusted EBITDA1 increased by $3.1M to $1.9M or $0.19 per share
  • Adjusted Net Income was $1. 3M or $0.13 per share
  • Cash increased by $1. 3M to $19.4M
  • Adjusted Shareholder Equity increased by $18. 3M to $47.5M

Second Quarter 2021 Internal Outlook
Second quarter 2021 internal outlook data stated below are approximations and could vary based on actual results.

  • Revenue - $147.6M
  • Overall Gross Profit - $26.7M
  • Gross Profit Margin - 18.1%
  • Cash - $25.1M
  • Adjusted EBITDA - $10. 3M or $1.03 per share

FORT LAUDERDALE, Fla., June 29, 2021 (GLOBE NEWSWIRE) -- LMP Automotive Holdings, Inc. (NASDAQ: LMPX) (“LMP” or the “Company”), an e-commerce and facilities-based automotive retailer in the United States, today reported its strongest first quarter financial results in Company history and provided its second quarter internal outlook. Management will hold a conference call at 4:30p.m. ET today to review and discuss the Company's business and results.

Sam Tawfik, the Company’s Chairman and Chief Executive Officer commented, “The strong improvements throughout the quarter occurred as a result of contributions of only a fractional month in March from acquisitions that we closed. This led us to the strongest first quarter financial results in our history. Management also witnessed accelerating growth in sales and gross profits in the second quarter and, as a result, we are expecting the second quarter results to be ahead of our internal outlook with expected revenue of approximately $147.6 million and Adjusted EBITDA of approximately $10.3 million or $1.03 per share. On an annualized basis in the second half of this year, we are expecting revenue to be approximately $610 million and Adjusted EBITDA of $44 million or $4.38 per share.”

Tawfik concluded, “In March, we announced an agreement to purchase an 85% interest in two metropolitan area Chrysler Jeep Dodge Ram dealerships in New York, which we expect close in the third quarter of this year. Upon the closing of these acquisitions and the one remaining Stage One dealership acquisition, LMP’s total franchise dealership operations and location count would be 19 and 17 respectively, with expected consolidated annualized revenue, Adjusted EBITDA and Adjusted EBITDA per share run rate to be approximately $910 million, $53 million, and $5.18, respectively.

Our pipeline of prospective dealership acquisitions is more active than we have ever seen, and we believe we are on track to achieve our goal of adding an additional 80 to 100 locations to our network by the end of next year by way of partnerships, mergers, and acquisitions. We project these additions to our network have the potential to add $5.1 billion to $6.4 billion in revenue, $229 to $288 million in Adjusted EBITDA or $8.80 to $11.00 in Adjusted EBITDA per share.

The Company intends to name a permanent Chief Financial Officer as well as add additional senior management personnel in both the accounting and operational departments in the coming weeks.”

Richard Aldahan, LMP’s Chief Operating Officer, stated, “I would like to welcome and thank our dealer partners as well as their respective teams consisting of over 450 colleagues. We are pleased with our unique partnership acquisition strategy and are witnessing the enthusiasm, efforts and degree of care from our partners which translated into the impressive financial performance over the past several months. The talent in our combined organizations along with the resilience and stability of our business model makes us a stronger and more diversified company. We look forward to achieving many more significant and transformative milestones in the future and believe the best is yet to come.”

1 EBITDA, Adjusted EBITDA, Adjusted Net Income, Adjusted EBITDA per share run rate and Adjusted Shareholder Equity are non-GAAP financial measures which are reconciled to the most directly comparable measures calculated in accordance with GAAP under the caption “Non-GAAP Financial Measures.”

First Quarter 2021 Financial Discussion

Adjusted EBITDA per share was $0.19;

Adjusted Net Income per share was $0.13;

Revenue increased to $33.0 million from $5.3 million;

Adjusted EBITDA increased to $1,944,479, from a loss of $1,164,706;

EBITDA increased to a loss of $434,831 from a loss of $1,278,458; and

Net loss (excluding noncontrolling interests) was $1,522,872, a $197,316 improvement compared to a net loss of $1,720,188.
Net loss per share increased to $0.80, or $0.62 as compared to a net loss of $0.18 per share.

First quarter 2021 revenue increased to $33.0 million, an increase of $27.7 million from $5.3 million in the first quarter of 2020. The growth was primarily driven by approximately three weeks of sales from acquisitions closed in March of 2021.

Total operating expenses were $7.9 million in the first quarter of 2021, compared to $2.1 million in the first quarter of 2020. The increase in operating expenses was primarily due to expenses related to acquisitions and operating expenses from acquisitions closed in March of 2021.

Adjusted EBITDA in the first quarter of 2021 totaled $1.9 million, compared to an Adjusted EBITDA loss of $1.2 million in the first quarter of 2020. The increase in Adjusted EBITDA was primarily related to EBITDA contributions from acquisitions closed in March of 2021.

We ended the first quarter with approximately $19.4 million in cash and $46.5 million in Adjusted Shareholder Equity.

Corporate Developments

Year to date 2021, the acquisitions completed expanded the company’s operations to 13 locations, covering the Southeast, Mid-Atlantic and Northeast regions. Our representative brands include Subaru, KIA, Chevrolet, GMC, Cadillac, and Buick.

In addition, we:

  • Announced a definitive acquisition agreement for the acquisition of an 85% interest in two Chrysler Jeep Dodge Ram Dealerships in New York;

  • Released our Next Generation, Integrated E-commerce solution and achieved an increase of 85% in unique organic users and page views;

  • Closed a $20 million private placement; and

  • Engaged KPMG as our Independent Auditor for Fiscal Year 2021 and strengthened our internal accounting team.

Future Internal Near-Term Goals:

Enter New Geographical Markets

  • At the forefront of our strategy is our unique and profitable industry consolidation effort by means of our dealer partnership structure in which we are seeing extraordinary interest from both small and large dealer groups that want to diversify, “stay in the game” and operate and grow the business. This strategy remains LMP’s primary focus given the impressive returns on invested capital and the significant addition to income and earnings per share it provides. We believe this is the swiftest way to increase earnings and shareholder value.

  • Our goal is to add an additional 80 to 100 dealerships to our network by the end of next year by way of mergers and acquisitions. We project these additions to our network have the potential to add $5.1 billion to $6.4 billion in revenue, $229 to $288 million in Adjusted EBITDA or $8.80 to $11.00 in Adjusted EBITDA per share.

  • Profitably consolidate and modernize the industry through our strategy, technology, physical logistics network, growing our experienced teams and growing our selection of owned inventories, providing customers with a seamless experience both online and in person.

Drive Revenue and Profit Growth in Existing Markets

  • Launch our planned “Order Online and Get It Delivered” advertising campaign.

  • Improve brand awareness.  

  • Expand our pre-owned e-commerce sales utilizing our 77 acres of recently acquired real estate, logistics footprint and physical store network.

  • Improve all company-wide operating metrics as we achieve economies of scale.

Innovate and Expand our E-commerce Technology Platform

  • Continue building out our integrated online sales platform to provide an improved experience for consumers and a seamless auto shopping and buying experience. Some of the features we expect to add include:

    • Estimate trade-in, get a certified offer with same-day payment
    • Real-time, personalized financing
    • Choose a vehicle and finance then upload important paperwork
    • Choose vehicle protection offerings then upload important paperwork
    • Set up a time for home delivery or in-store pickup

LMP Automotive Holdings, Inc.
Condensed Consolidated Statements of Operations (Unaudited)

  Three Months Ended March 31,
  2021   2020 
Revenues:     
New vehicle retail $15,925,296   $- 
Used vehicle retail  7,749,213    95,560 
Used vehicle wholesale  2,665,602    541,900 
Finance and insurance, net  1,325,197    - 
Service, body and parts  1,928,827    - 
Fleet and other  3,421,788    4,712,253 
Total revenues  33,015,923    5,349,713 
        
Cost of sales:       
New vehicle retail  14,452,586    - 
Used vehicle retail  7,052,744    89,605 
Used vehicle wholesale  2,451,412    661,983 
Service, body and parts  1,140,523    - 
Fleet and other  1,920,159    4,098,202 
Total cost of sales  27,017,424    4,849,790 
        
Gross profit  5,998,499    499,923 
        
Selling, general and administrative  7,884,238    2,098,886 
Depreciation and amortization  207,841    78,434 
        
Operating loss  (2,093,580)   (1,677,397)
Floorplan interest expense  (50,094)   - 
Other interest expense, net  (326,770)   (42,791)
Other income, net  947,572    - 
        
Loss before income taxes  (1,522,872)   (1,720,188)
Income tax provision  -    - 
Net loss  (1,522,872)   (1,720,188)
        
Net income attributable to noncontrolling interest  (145,632)   - 
        
Net loss attributable to LMP Automotive Holdings $(1,668,504)  $(1,720,188)
        
Calculation of income for earnings per share:       
Net loss attributable to LMP Automotive Holdings $(1,668,504)  $(1,720,188)
Change in noncontrolling interest redemption value  (6,361,033)   - 
Net loss attributable to common shareholders $(8,029,537)  $(1,720,188)
        
Basic net loss per share $(0.80)  $(0.18)
        
Weighted average shares of common stock outstanding, basic  10,040,542    9,326,054 
          

Non-GAAP Financial Measures

The Company has provided in this release certain non-GAAP financial measures, including EBITDA, Adjusted EBITDA, Adjusted Net Income, Adjusted EBITDA per share run rate and Adjusted Shareholder Equity to supplement its financial results that are prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). Management uses these financial metrics internally in analyzing the Company’s financial results to assess operational performance and to determine the Company’s future capital requirements. The presentation of this financial information is not intended to be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. The Company believes that both management and investors benefit from referring to these financial metrics in assessing our performance and when planning, forecasting and analyzing future periods. The Company believes these financial metrics are useful to investors and others to understand and evaluate the Company’s operating results and it allows for a more meaningful comparison between the Company’s performance and that of competitors. Our use of EBITDA, Adjusted EBITDA, Adjusted Net Income, Adjusted EBITDA per share run rate and Adjusted Shareholder Equity have limitations as analytical tools, and you should not consider these performance measures in isolation from or as a substitute for analysis of our results as reported under GAAP. Because of these limitations, you should consider these financial metrics along with other financial performance measures, including total revenues, total gross profit and net loss presented in accordance with GAAP.

EBITDA, Adjusted EBITDA and Adjusted EBITDA per share run rate for 2021 and 2020

The Company defines EBITDA as net loss before interest expense (excluding Floorplan interest), income tax expense, depreciation (including vehicle inventory impairment) and amortization.

  For the Three Months   
Ended March 31,
EBITDA 2021   2020   Change
Net loss $(1,522,872)  $(1,720,188)  $197,316 
Interest expense (1)  326,770    42,791    283,979 
Depreciation and amortization  207,841    78,434
    37,665 
Fleet vehicle depreciation  124,089    228,763
    (62,112)
Vehicle impairment  -    91,742
    (42,562)
EBITDA $(864,172)  $(1,278,458)  $414,286 
            
(1) Excludes floorplan interest           

The Company defines Adjusted EBITDA as EBITDA before acquisition and financing expenses, consulting, legal and auditing expenses incurred in connection with the acquisitions during the quarter, employee stock compensation, adjustments in warranty liability, and equity-based compensation.

  For the Three Months   
Ended March 31,
Adjusted EBITDA 2021   2020   Change
EBITDA $(864,172)  $(1,278,458)  $414,286 
Employee Bonus & Stock Compensation  1,806,410    -    1,806,410 
Adjustment in warrant liability  (947,572)   -    (947,572)
Acquisition expenses  1,258,488    -    1,258,488 
Consulting, legal and auditing  519,283    -    519,283 
Equity based compensation  169,042    -    169,042 
Legal settlement  3,000    113,752    (110,752)
Adjusted EBITDA $1,944,479   $(1,164,706)  $3,109,185 
            
Adjusted EBITDA per share $0.19   $(0.12)    
            
Weighted average shares of common stock outstanding, basic  10,040,542    9,326,054     
(1) Excludes floorplan interest           

Adjusted Net Income for 2021 and 2020

The Company defines Adjusted Net Income as net income before employee stock compensation expense, adjustment in warranty liability, acquisition expenses, consulting, legal and auditing expenses, equity-based compensation, and legal settlement expenses.

  For the Three Months
Ended March 31,
Adjusted Net Income and Adjusted Earnings Per Share 2021   2020 
Net loss attributable to common shareholders $(8,029,537)  $(1,720,188)
Change in noncontrolling interest redemption value  6,361,033    - 
Net income attributable to noncontrolling interest  145,632    - 
Net loss  (1,522,872)   (1,720,188)
Employee Bonus & stock compensation  1,806,410    - 
Adjustment in warrant liability  (947,572)   - 
Acquisition expenses  1,258,488    -
 
Consulting, legal and auditing  519,283    - 
Equity based compensation  169,042     -  
Legal settlement  3,000    113,753 
Adjusted net income (loss) attributable to common shareholders $1,285,779   $(1,606,435)
        
Adjusted basic net income (loss) per share $0.13   $(0.17)
        
Weighted average shares of common stock outstanding, basic  10,040,542    9,326,054 
          

Adjusted Shareholder Equity for 2021 and 2020

The Company defines Adjusted Shareholder Equity as total shareholders’ equity before non-cash equity items: warrants, adjustment for non-controlling interest, and issuance of common stock for acquisitions.

  For the Three Months   
Adjusted Shareholder Equity Ended March 31,
  2021  2020  Change
Total shareholders' equity $35,777,249  $29,144,489  $6,632,760
Warrants  4,867,074       4,867,074
Adjustment for non-controlling interest  6,361,033       6,361,033
Issuance of common stock for acquisition  473,436       473,436
Adjusted Shareholder Equity $47,478,792  $29,144,489  $18,334,303
            

ABOUT LMP AUTOMOTIVE HOLDINGS, INC.

LMP Automotive Holdings, Inc. (NASDAQ: LMPX) is a growth company with a long-term plan to profitably consolidate and partner with automotive dealership groups in the United States. We offer a wide array of products and services fulfilling the entire vehicle ownership lifecycle, including new and used vehicles, finance and insurance products and automotive repair and maintenance.

Our proprietary e-commerce technology and strategy are designed to disrupt the industry by leveraging our experienced teams, growing selection of owned inventories and physical logistics network. We seek to provide customers with a seamless experience both online and in person. Our physical logistics network enables us to provide convenient free delivery points for customers and provide services throughout the entire ownership life cycle. We use digital technologies to lower our customer acquisition costs, achieve operational efficiencies and generate additional revenues. Our unique growth model generates significant cash flows, which funds our innovation and expansion into new geographical markets, along with strategically building out dealership networks, creating personal transportation solutions that consumers desire.

Investor Relations:

LMP Automotive Holdings, Inc.
500 East Broward Boulevard, Suite 1900
Fort Lauderdale, FL 33394
investors@lmpah.com

For more information visit:
lmpmotors.com

FORWARD-LOOKING STATEMENTS:
This press release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. Such statements include, but are not limited to, any statements relating to our expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “projection,” “seek,” “can,” “could,” “may,” “should,” “would,” will,” the negatives thereof and other words and terms of similar meanings. Forward-looking statements are based on management’s current expectations and are subject to risks and uncertainties that could negatively affect our business, operating results, financial condition and stock value. Factors that could cause actual results to differ materially from those currently anticipated include: our dependence upon external sources for the financing of our operations; our ability to effectively executive our business plan; our ability to maintain and grow our reputation and to achieve and maintain the market acceptance of our services and platform; our ability to manage the growth of our operations over time; our ability to maintain adequate protection of our intellectual property and to avoid violation of the intellectual property rights of others; our ability to maintain relationships with existing customers and automobile suppliers, and develop relationships; and our ability to compete and succeed in a highly competitive and evolving industry; as well as other risks described in our SEC filings. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as required by law.

SOURCE: LMP Automotive Holdings, Inc.