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spk00: Thank you for standing by. This is the conference operator. Welcome to the LMP Automotive Holdings fourth quarter and full year 2020 financial results conference call. All participants are in a listen-only mode, and the conference is being recorded. After a presentation by management, there will be an opportunity to ask questions. Before we begin, I would like to remind everyone that this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements pertaining to future financial and or operating results, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management constitute forward-looking statements. Any statements that are not historical facts should also be considered forward-looking statements. And of course, forward-looking statements involve risks and uncertainties. I would now like to turn the call over to Mr. Sam Taufik, LMP Automotive Holdings Chairman and Chief Executive Officer. Mr. Taufik, you may begin.
spk05: Thank you, Operator, and good afternoon, all, and I want to thank everybody for joining the call today. We are pleased to announce the material transformation of the company by way of acquisitions that we've closed this month. These additions transformed the company from a $30 million revenue company last year to an excess of $500 million in annualized revenue this current year, representing over a 1,600% increase from 2020, also generating $20 million in annualized adjusted EBITDA income. These transactions represent over a 30% return on invested capital annually for the dealerships and almost twice the average market return on the real estate. The acquisitions market remains robust and the company is well positioned to continue the acceleration of our growth strategy. Some highlights for last year. versus 2019. Revenue increased 180% to a little over $30 million. Gross profit increased by $3.2 million to $3.1 million. Subscription leasing and rental margins increased by 113% to 56%. Adjusted EBITDA loss was 1.31 million with an adjusted EBITDA margin of 4.3%. An improvement of about three quarters of a million dollars and 14% respectively. Adjusted EBITDA loss per share was 13 cents, an increase of a penny. Shareholder equity and current shares outstanding at fiscal year ending 2020 was $29.1 million and $10.03 million, respectively. Now I'm going to pass the call over to our Chief Financial Officer, Evan Bernstein, for some more detail on our results.
spk04: Thank you, Sam. Our 2020 adjusted EBITDA improved by $744,000. Our revenue increased over 2019 by $180,000. Our operating expenses increased from prior year. As we staffed up and increased our acquisition activity, the expenses were $7.5 million in 2020, an increase of approximately $3.7 million over 2019. Our subscription service revenue increased 7.5% over prior year, and our vehicle sales revenue increased 207% to $28 million. The interest revenue increased by over $500,000. And the shareholder equity increased to $29 million at the end of 2020, up from $10 million in 2019. I'm now going to hand it over to Richard Aldean, our Chief Operating Officer, to give an overview of our near-term outlook.
spk02: Thank you, Evan. I would also like to thank everyone for joining this call. Before I get into the details, I want to share with everyone that in early March of this year, and as late as this past Tuesday, we closed on many of our previously announced acquisitions. Our investment to date is approximately $50 million, which has historically generated over half a billion. That's right, $500 million in revenue and $18 million in adjusted EBITDA. We have also invested another $50 million in associated real estate, which generates $3.7 million in rent and adds $2 million in gross profit. So, again, please keep in mind that our Q1 numbers that I'm going to discuss shortly only include two to three weeks of March business from our newly acquired dealerships. Furthermore, we will begin to report additional metrics that compare our figures to other companies in the franchise dealership sector. So our 2021 and 2022 internal expectations goals are as follows. As stated, as you've heard earlier, our revenue for Q1 is expected to be in the 29 to 30 million to $31 million range. which should surpass our entire 2020 revenue. We anticipate annualized revenue in 2021 to be $535 million and continue to grow to $580 million or almost $590 million in 2022. Our adjusted EBITDA margins will be in the range of 3.3 to 3.6% for Q1, and that number will continue to grow to 4.4 in 2021 and 4.9 in 2022. For Q1, we expect to sell 400 new units, 400 pre-owned retail, and some additional wholesale units for a total of about 1,000 units. Again, keep in mind this is anywhere from a few days to a couple weeks' worth of business in March. Our annualized volume for 2021 is approximately 19,600 units, and we anticipate that to continue to grow through 2022 with about 20,600 units. Again, as you've heard earlier, our total revenue for 2021 is anticipated to be over $506 million. In addition, our subscription leasing for Q1 is $325,027 million for 2021 and, again, continue to grow to about $40-plus million for 2022. Real estate revenue for Q1, $280,000 adjusted for 2021, approximately $4 million, and that will stay constant for 2022, assuming we don't add any additional businesses. So it's really exciting at OMP, and I would like to hand it back to Sam, our CEO, to walk through the company's strategic goals. Sam?
spk05: Thank you very much, Richard. In the near term, between now and the end of next year, at the forefront of our efforts is our unique and profitable industry consolidation effort by means of our dealer principal partnership acquisition structure, in which we're seeing extraordinary interest from both small and large dealer groups that want to diversify as well as stay in the game, as well as operate and grow the business. The strategy remains LMP's primary focus, given the impressive returns, as stated earlier, on invested capital and the significant addition to income and earnings it provides. We believe this is the swiftest way to increase earnings and shareholder value. Our goal between now and the end of next year is to add an additional 80 to 100 dealerships to our network. which we project will add an additional 5.1 to 6.4 billion in revenue and approximately 136 to 170 million in adjusted EBITDA income post-minority interest. Our third priority is to profitably consolidate and modernize the industry through our strategy, acquisitions and such. technology, physical logistics that are achieved through the acquisitions, and continue to grow our experience teams both at corporate and the acquisition partners. This grows our selection of owned inventories, hence providing customers with a seamless experience both online and in person. We will continue to drive revenue and profit growth. We intend to launch our planned order online and get it delivered advertising campaign, which in turn should improve brand awareness, expand our pre-owned e-commerce sales, utilizing the 77 acres of recently acquired real estate and logistics footprint, as well as our physical store network. And thirdly, improve all company-wide operating metrics as we achieve the economies of scale. We'll continue to innovate and expand our e-commerce technology platform in order to improve the experience for customers and a seamless auto shopping and buying experience. Some of the features we expect to include are as follows. Estimate a trade-in, get a certified offer with same-day payment, a real-time personalized financing scenario based on the customer's profile, choose a vehicle, finance it, and then upload the paperwork. This provides a significant savings to SG&A. That's a process typically at the dealership networks. choose a vehicle protection plan as well, and then upload the paperwork. Then you can set up a time for home delivery and in-store pickup and make payments and manage your account online. Now I'd like to turn it over to the operator for questions and answers.
spk00: Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Once again, that is star one, if you would like to ask a question. Our first question comes from Matt Horn, private investor. Please go ahead.
spk03: Hi, good afternoon, everybody. My question is pretty simple. I think everyone wants to know what happened with the Atlantic deal.
spk05: I can answer that, Sam. Thank you. Atlantic is a unique dealership group. It's potentially the most contiguous dealership group in the United States. And that deal was unable to be consummated because of that. There are parameters that are involved. with the factories, et cetera, that if they don't grandfather it in, then it can't be sold to one buyer.
spk03: Okay, great. I have one other question. I just want to know when you anticipate adding all the new acquisitions into the online where we can see the subscriptions and the vehicles for sale, everything that's been acquired at this point.
spk05: That's in progress, and we're targeting the next several weeks to roll in all the inventory onto our systems.
spk03: Fantastic. That's all I have. Thank you.
spk05: Thank you, Matt.
spk00: There are no further questions. I would like to turn the floor over to Sam. Oh, we have one more. Hold on. Next question, Michelle Farr, private investor. Please go ahead.
spk01: Hello, Sam. Mitchell Farr down in South Florida. Just curious, when is the new designed website going to be live? Hi, Mitchell.
spk05: It's currently live. And the back ends are integrated to our dealership acquisitions that we closed. And We're now synchronizing less the technology but more the human effort of process and procedure to roll the inventory in after a vehicle is photographed. It should automatically appear on our systems, and we're automating the process end-to-end. So there's not much human interaction there, but the new site is live. Inventory will start rolling in in the coming weeks.
spk01: Is it the same app or is it going to be a new application? Okay, so the website is live.
spk05: The app should come live. We're targeting April 20, I'll call it third week in April, to then roll that into the app, both look and feel as well as the inventory.
spk01: Oh, excellent. Thank you.
spk05: Thank you, Matt. Thank you, Mitchell. Sorry. You're welcome.
spk00: Thank you. I would like to turn the floor over to Sam for closing remarks.
spk05: Well, thank you all for joining the call today and looking forward to our continued progress and keeping you up to date. Thanks again.
spk00: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.
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