Good morning, and welcome to Camping World Holdings conference call to discuss financial results for the third quarter of FY 22. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session and instructions will follow at that time. Please be advised that this call is being recorded and the reproduction of the call in whole or in part is not permitted without written authorization from the company. Participating in the call today are Marcus Lemonis, Chairman and Chief Executive Officer, Brent Moody, President, Karin Bell, Chief Financial Officer, Tamara Ward, Chief Operating Officer, Matthew Wagner, Executive Vice President, Lindsey Christen, Executive Vice President and General Counsel, Tom Kirn, Chief Accounting Officer, and Brett Andress, Senior Vice President, Investor Relations. I will turn the call over to Mrs. Christen to get us started. Thank you and Good morning, everyone. A press release covering the company's third quarter 2022 financial results was issued yesterday afternoon, and a copy of that press release can be found in the investor relations section on the company's website. Management's remarks on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These remarks may include statements regarding the impact of COVID-19 on our business, financial results and financial condition, our business goals, plans, abilities and opportunities, industry and customer trends, our recently disclosed cybersecurity incident, the expected impact of inflation and market conditions, our strategic initiatives, acquisitions, SG&A expenses and capital expenditures, potential stock repurchases, future dividend payments, increases in our borrowings, our liquidity and future compliance with our financial covenants and anticipated future performance. Actual results may differ materially from those indicated by these statements as a result of various important factors, including those discussed in the Risk Factors section in our Form 10-K, our Form 10-Qs, and other reports on file with the SEC. Any forward-looking statements represent our views only as of today, and we undertake no obligation to update them. Please also note that we will be referring to certain non-GAAP financial measures on today's call, such as EBITDA, Adjusted EBITDA, Adjusted earnings per share diluted, which we believe may be important to investors to assess our operating performance. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial statements are included in our earnings release and on our website. All comparisons of our 2022 third quarter results are made against the 2021 third quarter results, unless otherwise noted. I'll now turn the call over to Marcus. Thanks, Lindsey. Good morning, and thanks for joining us for Camping World's 2022 third quarter earnings call. On today's call, we're gonna lay out our financial results along with providing some insight into the remainder of this year and 2023. As a company, we continue to experience healthy demand, resulting in our company generating revenue for the quarter just shy of $1.9 billion. During the quarter, we sold over 32,000 RVs, just under the record we set last year, with the big driver being our record used unit sales of 14,460 units, up over 6% compared to the third quarter last year. We have seen recent demand stay comparatively strong for this time of year, with used RVs setting the pace. During the third quarter as a result of growing installed base of RVers and evidenced by our results, we continue to see both stability and growth in our service business, Good Sam segment, and our used business. As you'll hear today, we feel very strongly that these key areas of our business and further investments in them will help us to intelligently and profitably outperform the market over the next 12-24 months and beyond. One of the key things I want investors on this call to focus on is the success we're having in driving the used side of our business in the face of short-term pressure on the new side. Our goal of achieving used sales of $3 billion annually has substantial momentum. For the quarter, our record used unit sales delivered over half a billion dollars of revenue up over a year ago, putting us at $1.9 billion on a trailing 12-month basis. More importantly, $400 million higher than the trailing 12-month figure from a year ago. As we talked about on our last call, our used margins landed in the range that we told people, down less than 150 basis points compared to Q2. The reason we feel so strongly about this shift into used is because we now have more evidence from our results. Simply stated, the gross margin return on investment is higher than new, and the turns are faster. Furthermore, each transaction contributes to the profitability of our overall business, including service, replacement and aftermarket parts, as well as our Good Sam finance and insurance products. Look, we know that the used business is a game of scale. It requires capital, proprietary technology like the Good Sam RV Valuator, and a very strong and healthy database to both buy from and sell to. We possess all of them. Much like the new side of the business, the supply chain is key to success. A highly disciplined approach to procurement, reconditioning, pricing, and marketing are key, but a stringent approach to stocking levels, turns, and aging matter more. We expect to maintain that discipline. Since we last talked in August, we ramped up our procurement of used inventory, launching the Good Sam Confidence Program, a new consumer-facing strategy to offer a current RV owner a no-hassle process with full disclosure around their value, regardless of whether they're selling the unit outright or trading it in for another. The early results are fantastic. In the first 50-day period, this has resulted in us procuring over 6,000 units. More importantly, we sold more than that in the same period. We love the used category because it's not only a great growth agent, but we also see it as a hedge. In the last 12 months, nearly 900,000 used units changed hands. That's almost double what happens on the new side. The opportunity for us is clear. With all the success we're seeing in used, it is absolutely still our plan to remain the market leader in the sale of new RVs. In fact, for the quarter, we retailed in excess of 17,600 new units with a gross profit margin of 19.1%, a decline of only 180 basis points compared to the second quarter of this year. The key topic on the new side is, quite frankly, inventory management, and the key metric inside of that is that we look at the total number of new units by location. Today, we're stocking around 182 units per location, down compared to the Q3 historical average of 208 units when you use 2016 through 2019. As always, our inventory levels in Q4 and Q1 ramp up in preparation for the selling season. We will continue to tightly control this number and aim to yield more with less. As the size of the installed base of RVers continues to grow, like it has for the last four decades, it's clear that our products, services, and other business, also known as our service and parts business, continues to be a steady and predictable growth engine for our company. That business generated $269 million of revenue for the quarter, and we ended the quarter with 2,639 bays and over 2,300 service technicians. An additional benefit of both the growth of RVers in America, along with the growth of our own database, is the continued growth of our Good Sam business. For the quarter, Good Sam generated revenue of $50.4 million, an increase of 8.1%. When we jump into the financial summary for the quarter, our Adjusted EBITDA was $173.4 million. Our gross profit for the quarter was almost $595 million, a 32% margin. Slightly down from last year, as we discussed, but it was still nicely above our historical average of 27.5 that we experienced between 2016 and 2019. Our tight control of SG&A and capital expenditures is a key component of our management philosophy. Our management team is not naive to the current macroeconomic environment, and we are currently making the hard choices on what to shed and where to deploy our capital. We have, and will continue to, significantly reduce our marketing obligations, eliminate underperforming assets, pause on certain initiatives, and reduce headcount. While we're making tough decisions, our plan is to continue to focus on funding our major growth drivers and our dividend. Our plan is to deploy our capital in the foreseeable future in this way, our used, our service and parts business, our Good Sam business, and opportunistic acquisitions. We ended the period with $148 million of cash on our balance sheet, plus an additional $219 million of cash in our floor plan offset account. In addition, we have about $426 million of used inventory and $294 million of parts inventory. Lastly, we also have about $278 million of real estate without an associated mortgage. As expected, our business is returning to its historical seasonal patterns. When we look at the normal pre-pandemic progression of sales from the third quarter to the fourth quarter, revenue typically declines by about one-third, and Adjusted EBITDA margins historically are right around the low to mid-single digit range. In closing, as we head into 2023, we are focused on where our business is going. With that, we're planning our SG&A CapEx and capital allocation based on industry conditions that might be lower than some of the projections I've seen in the marketplace. If we're wrong, it'll be the best time to be wrong. If we're right, we'll be well-positioned to intelligently and profitably continue to outperform the market. We believe that Camping World is a unique and special business, because it ultimately serves the growing installed base of RVers. That's evidenced by the stability and/or growth in our used business, our service and parts business, and our Good Sam business. I'll now turn the call back over to the operator for questions. Thank you. We will now be conducting a question-and-answer session. If you'd like to ask a question, please press one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two 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. Our first question comes from Mike Swartz with Truist Securities. Please go ahead. Hey. Good morning, everyone. And Marcus, I just wanted to kind of add on to your comment that you just made of planning for the industry to be maybe worse than what some of the numbers you're hearing out there. I think pretty broadly, the consensus view is maybe retail at closer to, you know, 400,000 units in 2023. If we go back, I think the industry was around, right around that level in 2016. The question being is, you know, is your 2016 earnings level the right way to think about earnings if we see a 400,000 unit number? I mean, obviously, you've added about 80 doors since that time, so there's some M&A pickup. Just maybe any sense or any parameters you can give us how to think about earnings in that scenario. Well, our business is materially different than it was in 2016. It's, you know, it's almost double the size, and a lot of parts of our business have grown nicely. I think what I like to always compare it to as we go into these headwinds is a lot of people have been talking about what 2019 was like when the industry was under a lot of pressure because the manufacturers had overbuilt, margins came screaming down. For us, that was really a lot of lessons learned. When I look at the 2019 results, we recognize that there were two big errors in my decision-making in that moment in time. The first was we had launched an initiative in a segment of our business that wasn't our core business. When we look at shedding that and all the associated expenses that we don't have today that we had back in 2019, our SG&A is about $150 million lower on a comparative basis. I think additionally, when we deployed our capital in certain categories that weren't turning fast, that weren't giving us the margin profile we wanted, and we then exited all those categories and shifted into our current makeup mix, that's about $100 million of gross. If I was pro forma 2019, I'd have about a $250 million adjustment up from where that low watermark was. In addition to that, I think we also learned that this business is best when it sticks to its absolute core strike zone, the selling, servicing, financing, and all the associated products related to exclusively RVs. When we look at any time we go into a headwind period, and I've been doing this for 20 years, you have to contract your SG&A, contract your headcount, contract all of your initiatives, and get hyper-focused on primarily three categories. The used business because of the margin profile and its uniqueness in the marketplace, the service business because there's over 11.5 million RVers already in the marketplace and growing, and our Good Sam business because it services that. That doesn't mean that we're gonna be out of the new business. It just acknowledges that the new business is under pressure. Looking at 2016 isn't necessarily fair, but I do believe for our own planning purposes, and we are not forecasters of any industry, we just happen to see more consumers than anybody else in the industry. I really do believe that it's prudent for our company to reduce its headcount, control its cash and its SG&A and its CapEx as if there's the possibility of the shipment data going down, not from 400, which is what I've seen published, but it could go down as low as 360-370. If I'm wrong, great. I'm not gonna allow this business to have any excess waste, any excess headcount, any excess SG&A or any new initiatives during this period because my job is to protect the investors from any downside that I possibly can and to put our capital where we think we're gonna get the greatest return. Okay. That was extremely helpful. I appreciate that, Marcus. Just maybe, I think you made the comment in your opening commentary that demand has held comparatively strong for this time of year. Maybe in the context of, like, the cadence of the quarter and what you've seen in October, any color you can provide there around those specific comments? Yeah, it's really kind of crazy when I look at the last four months and I include October. August and September were relatively decent. We were starting to feel the margin pressure in the middle of the quarter, and we obviously wanted to react. That's partially the reason that, in our opinion, we outperformed the retail registration data that was out there in the market. I think we were down six or seven for the quarter on the new side, and some data that I've seen may be as high as 25 or 26%. When you look at SG&A and you look at margin, we spent a little bit more to keep that volume wheel going because of the overall lifetime value of that transaction, and our margins came down a little bit, as we discussed. We saw September come, and our volume fell irregularly compared to what we had seen. It fell off pretty hard compared to July and August. Then we got into October, and our volume came back. Now, I don't want to attribute that to the hurricane or anything like that because we are definitely. We'll never use weather as a forecaster. What I'll attribute it to is there continued to be pressure in the marketplace, and we had to pivot. Oftentimes, when we spend marketing money in a month, there is a slight delayed reaction to yielding that revenue. It's not like the grocery store where we advertise tomatoes today and somebody comes in. There is about a 17-day lag period between us marketing something, getting a lead, and that transaction happening. That's probably why we saw relatively flat sales in October, but we experienced a slight bit more margin compression than we had in the third quarter. We typically do in the fourth quarter. If you go back and look at history, the fourth quarter is always about one-third less volume than the third quarter. The margins over all the years that I've been doing this always come down in the fourth quarter. They may come down for us a little bit more because we're so stringent around our inventory discipline that when we get into the fourth quarter, anything that has anything growing on it, if it's over 180 days, we start to liquidate at a more rapid pace because we don't want to carry it through the winter, which is obviously the slowest period. As you think about November, December, January, February, those are the four toughest months for the recreational business, not just our business. Over the last couple of years, we've kind of been, you know, able to rebuff that a little bit. I think we're starting to see those traditional seasonal trend lines come back into play, which is why in the prepared remarks, I talked about revenue coming down about a third from the third quarter, and then the SG&A comes down on a variable side, but there are some fixed costs still in there, which is why the EBITDA margin comes back down to the historical levels as well. Okay, super helpful. Thanks, Marcus. Yep. Next question comes from Joe Altobello with Raymond James. Please go ahead. Thanks. Hey, guys. Good morning. I guess first question, Marcus, would love to get your thoughts on the promotional environment. Obviously, you haven't seen much in the way of promotion or discounting over the last two or three years. It seems like the expectation is that we'll get back to, you know, 2019 levels in terms of promotions. I guess first question is that your outlook, or could we see even heavier promotional activity versus three years ago? We're budgeting for something better than what happened in 2019 because there was an excess supply of new inventory in the channel that even evidenced by our current same-store sales unit stocking decline over historical levels, that we don't think we're gonna see that level of pressure. We are going to see pressure compared to what we've seen in the last 12 months. I think the manufacturers, probably because we started to call this out last February, they started to pull back on their production, and we don't believe that there's a heavy glut of inventory in the channel today. Now, the manufacturers and dealers have to stay disciplined through this next, what I'm going to call six to seven months, because there are headwinds that are coming at us at a pretty rapid pace. I think the only way profitability maintains itself at a level that we want it to is very tight inventory control, both on the buy side and the sell side, and a very robust focus on used because of the margin profile there. We are expecting there to continue to be slight pressure, but I wanna be clear, we don't expect at this point, unless some new information comes out, that we're going to see margins look like they did when everybody was on a fire sale in 2019. Got it. That's very helpful. Just to follow up on that, maybe if you could give us an update on some of the progress that you've made on some of your recent initiatives like peer-to-peer RV rentals, for example, your service marketplace, et cetera. Well, I'm pleased that we launched those initiatives over the last couple of years. We've made the decision to almost virtually cut back all spending on any initiatives other than our core business. We just have decided that at this point, our investors expect us to lock everything up, reduce SG&A at a very rapid pace, unfortunately reduce headcount, and we can't in good conscience reduce headcount and continue to spend on ideas. While those ideas are good, they'll be there for another day. Today it's used, service, Good Sam business, and a lockdown of SG&A. Got it. Thank you. Next question comes from Daniel Imbro with Stephens Inc,. Please go ahead. Hey, Good morning, Marcus. Thanks for taking the question. I want to start on the revenue line. You know, I think last quarter you said you expected same store kind of down 15%-18% in the back half. Obviously, you outperformed that on both new and used. I guess what drove that? Was it just a stronger consumer than you expected? Was it better inventory control? And I'm guessing that's not the right level for the back half now. Can you help us frame up, like, what you would expect, same sort of decline for the rest of this year, given what you've seen? I think you said October was flat. Yeah. We believe that our proprietary database, along with the way we market, along with our pricing strategy, a lead-based pricing strategy, is what drove some of our results. In addition to that, we spent about $5-$6 million, probably more than anticipated, on generating activity for that revenue to be generated. When we look at the overall long-term health of our business, more transactions and more unique customers in our database gives us greater lifetime value of our customers. The best acquisition point for lifetime value of a customer, a Good Sam member, is the sale of a new or used RV. It feeds our service business, our parts business, and our Good Sam business. We made the decision internally as we went through the quarter to continue to invest in the flywheel. We understand that our SG&A was higher than anticipated. We acknowledged that we needed to make some cuts, and those started in the third quarter. What we don't wanna do is stop the momentum of our flywheel. Now, as we go into the fourth quarter and the first quarter, we're going to be pulling that back pretty heavily. We will not do that at the expense of breaking our flywheel because we know that the long-term value created in those transactions yields us income in 2023, 2024, and beyond. As we prepare for the fourth quarter and we prepare for the first quarter, I'm going to stick to my narrative of down 15%-18%. I know that I've said that three quarters in a row and we've outperformed it. I'd rather show up and have people be pleased with our outperformance than disappointed with our over-optimism in the face of a macro environment that everybody can see. I'm gonna stick to down 15%-18%. I'm going to tell you that I believe that our new and used margins in the fourth quarter are going to experience a normal seasonal fourth quarter compression. Our SG&A, just so we can get it out on the table, historically was always materially higher than the second and third quarter because it's our shoulder season. What we don't wanna do is have people think two things. One, that the fourth quarter that we experienced in 2020 and 2021 is normal. I remember for many years, we never made money in the fourth quarter. We started to make money in the fourth quarter because we started to control our costs and generate some revenue. We are very focused on that. To project revenue deep into 2023, I think would be dangerous at this point for all of us. No. That's really helpful color, Marcus. If I think back on the investment, you kind of listed the four buckets of used service and parts, Good Sam. The fourth one was M&A, and it feels like you guys have historically leaned into that during downturns. I'm curious, are you seeing more sellers come to the table? Kind of, where are multiples on the M&A side? Just as we look at the public stock multiple and then how you weigh the decision between buybacks or M&A, we'd love to hear any updated thoughts you have on the M&A channel. We're always conflicted when we look at the low valuations that are being assigned to our company when we know the intrinsic value of our company is higher. We're always conflicted. Our primary objective in this company has been and will continue to be from 2016, when we went public, for the foreseeable future, is that we are an opportunistic acquirer of RV dealerships because it is the baseline, it is the foundation of everything else in our company. We have started to see a pickup in people wanting to talk about selling their business. I can tell you with absolute conviction that those multiples have come down, those expectations have come down. What we are doing in our company today is building cash, as evidenced by all the working capital that we talked to you about, and getting ready to be opportunistic. Getting ready to be opportunistic. We do not, at this point in time, as we sit here today, have anything materially signed that we're prepared to disclose. I can tell you that when we went public, we told the marketplace one thing: we like a downturn for two reasons. We get better at managing our business. We tighten up our SG&A, we improve our processes and our efficiencies, and we buy a ton of revenue at a very low to no multiple. When that hockey stick turns, and it always does, we end up experiencing revenue and earnings that we essentially paid nothing for. We buy inventory, we buy real estate, and in some cases, we pay a little scratch of goodwill, but nothing like we pay in the good times. We are the best at buying those types of businesses because our processes and our systems go into what we would call distressed or troubled businesses, and we yield an unbelievable return on capital. Yep. Makes a lot of sense. Thanks so much for the color, Marcus, and best of luck. Yes. Thank you. The next question comes from Craig Kennison with Baird. Please go ahead. Hey, Good morning. Thanks for taking my question. Marcus, you talked about the used business being a scale business, and I certainly appreciate that. You talked about one node in that process being the reconditioning process. I'm just curious if you could just comment on the scale you have in that particular function and maybe what it costs to recondition the average unit. I'm gonna have Matt take that, Craig. Hey, morning Craig. Great question. When we think about the scale that Marcus was alluding to in his opening commentary, it's more in reference to our ability to actually source used better than any other entity out there. I say that inasmuch as part of my apprehension over the years of getting involved more in used is the uncertainty associated with that supply chain. I'd like to think based upon all of our proprietary technology, the experience that we've amassed over the years of how our consumers behave in the trade-in cycles and our ability to actually drive down that cost associated with a lead to procure a used unit. I can tell you right now, we're averaging about 2,000 leads per day to buy used units. If you extrapolate that out, that's in excess of 700,000 used units that we could potentially buy on an annualized basis. I can tell you, no one else out there has the access, the amount of capital, information that we do to be able to procure these assets at a severely reduced value compared to all of our competitors out there. When you asked about recondition, that's another great question. I can tell you that's been one top of mind as we're trying to figure out in terms of our capacity between our external work versus our internal work and what's the best methodology for us to optimize every single transaction, every single reconditioning effort, while at the same time ensuring that we could put our brand behind these used assets that we're selling to these consumers. On average, you know, we're gonna range anywhere from 5%-10% on reconditioning for those assets that we want to actually recondition. I say that because we also acknowledge there's certain model years, certain age of units where frankly, it's just not worth reconditioning. In our minds, we're continuing to get better and better in terms of parsing out the different ways that we approach used. We're continuing to learn every day, and I'm really confident in the long-term outlook of what we should be able to accomplish here over the next year. Thanks. As a follow-up, is there a sweet spot for you in the used market, whether it's the age of a unit, the model, the brand? Or are you able to be successful at a pretty broad range of used product? Honestly, that's where we've been able to fine-tune our methodology to such an extent where we're able to optimize that gross margin return on investment because we know exactly which model years are going to yield the most lucrative return for us as an enterprise. I'll give you the generalized range, but we know within there's certain segments, certain floor plans, certain brands, but generally seeing about 2016-2020 model years is that general range where we oftentimes target, understanding that that consumer will have even a higher likelihood of remaining within the lifestyle too thereafter. Hopefully it turns into a trade. Frankly, we could purchase it at a significant opportunity in arbitrage where other competitors simply just don't see that, and we could see that opportunity. Craig, to Matt's credit, the secret sauce in the valuator tool that Matt built has multiple layers inside of it, and it's kind of an evolving process. When you go in as a 2014 owner, you're going to go through a different experience than you would as a 2017 owner. The values that are ascribed to specific units do vary. Part of the reason why Matt doesn't just wanna disclose all of it is 'cause it is part of our secret sauce. It's all the way down to values fluctuating up or down based on model year, based on floor plan, based on make, based on model, and more importantly, based on our own experience with selling all these units over a decade. As we've seen this growth in our used inventory, and we'll continue to see growth in our used inventory, it isn't some haphazard walking around thing. I want to address something that you've also asked me in the past around the values of used. The Valuator is a daily dynamic formula. What that means is every single day, those values are coming up and down like they would for the commodities market for corn or for oil or for whatever it may be. It's based on demand, it's based on time of year. When we buy something today, we may have paid materially less than we did yesterday. As a side to that, when you look at our current inventory position, which everybody should be thinking about, it's important for people to know that we have the strictest adherence to an aging policy. If there is a change in values in the marketplace, we turn our inventory so quickly that we rarely get caught flat-footed. That does not mean that we don't make mistakes. That does not mean there aren't cases where we put too much reconditioning into it. When we get to the fourth quarter, that's usually when we kind of flush the toilet on a few things. We have for years. I want investors to be very comfortable that there is an acute science to managing their capital that's deployed into used inventory very strictly and how we buy things. It's not just buy as much as you can for as much as you want to pay for it. It doesn't function that way. That's helpful. Thank you. Next question comes from John Healy with Northcoast Research. Please go ahead. Thank you. Just wanted to ask a couple of questions, kind of on the financing side. We'd just love to get some perspective on what you're seeing there. Obviously you're outperforming the industry, but would just love to understand the sales process. How it's become more elongated and what you're seeing on the cost of financing for these consumers as they're coming in to shop for a unit. Well, the process to buy, quite frankly, with our company is relatively easy. We pre-qualify many people before they even come in. When they come in, our finance process is very stringent and has a very tight process to it. We haven't seen, at this point, any change in lenders' willingness to lend credit out there. We've seen no headwinds of any kind. I think that's primarily because the RV consumer typically is a better credit profile customer historically than the auto customer. It's an average 700 credit score, household income over $100,000. It's a different type of buyer. When you look at the delinquencies that lenders experienced even back in 2008 and 2009, it was a small fraction of what the auto business went through. That's number one. I think the second thing is, we learned over the last 10 years that having fewer banking partners making credit available to our customers would yield us a better result. When a bank is going to make an exception or stretch on a particular customer, they do it with us because the overall portfolio that we give them is very rounded out and robust. As opposed to us having a finance office where there's 30 banks, we may have one where there's 5 or 6 and a local credit union. That type of process took us a decade to refine, and that could be one of the reasons why we're potentially outperforming on the new side because that tight process on the finance side and our relationships with partners. It's much easier to service our account. If and whenever it happens, something goes bad on a loan, we have that built-in relationship where they can sell it to us or consign it to us on the used side and help that customer or bank recover whatever losses they may have experienced. That's super helpful. Another question I wanted to ask was just any color on what's going on in the state of Florida. I mean, obviously, a big market for you guys. Are you expecting any sort of kinda government purchases kind of on RVs as we close out the year? Or, you know, any sort of view on how supply was maybe impacted in the market? Well, obviously we're all terribly devastated by what happened, particularly in South Florida. I visited all of our South Florida stores over the last 10 days, and the demand is strong. It's unfortunate that the demand is strong for the reason that it's strong. We expect that demand to continue here in the foreseeable future, and I think the one advantage we have as a company is our ability to mobilize inventory from the entire Southeast U.S. and continue to feed those locations on a regular basis. As it relates to governmental acquisitions of inventory, we're not seeing much FEMA activity. We have heard about some activity inside the state of Florida, issued by the state of Florida. At this point, we are, you know, putting bids in through the process, but we're focused on the general consumer who's showing up with insurance checks and in some cases showing up with no home at all and just transacting in a normal process. We're not expecting any big bulk sale in the fourth quarter. Obviously if that happens, we'll let everybody know. Great. Thank you so much. Next question comes from Ryan Brinkman with J.P. Morgan. Please go ahead. Hi. Thanks for taking my questions. Wanted to ask about where you think the industry overall may be in terms of, you know, RV inventories on dealer lots. I know you've been disciplined on new unit stock turn and aging as you ramp your focus on the used side. Do you have a sense for where your competitors may be with regard to new inventory? You know, what's the latest in terms of your thinking regarding the balance of supply and demand for new units and the implication for new RV retail gross margin? I don't ever like to forecast what other RV dealers are doing. I think that's a dangerous thing 'cause we're not forecasters of other people's businesses. I do believe that other dealers and manufacturers have displayed a level of discipline that, to be candid with you, I haven't seen in my 20 years of being in this business. Maybe it was because we raised the flag early in February, maybe because everybody realizes that margin protection is a function of inventory discipline. That's what we believe. There are going to be some dealers that aren't going to be able to compete in this environment. They don't have the digital strategy, they don't have the database, and they're not gonna be able to enjoy it. It's possible that in certain pockets, in certain markets, dealers may become far more undisciplined about their own pricing strategy. As the industry continues to consolidate with other large retailers like us, there is a sophistication that exists today that maybe didn't exist three, four years ago, 10 years ago. There's a sophistication that exists on the manufacturing side that I don't believe existed four or five years ago or 10 years ago. I do believe, however, that we're all capitalists and retailers at heart, and when we wanna create transactions or generate revenue, we know that the easiest way to do that is to incentivize the customer to do something. I expect that promotional activity and margins will fluctuate here over the next four, five, six months as the headwinds exist. That's just good business to move your inventory. I think what everybody has to recognize is that this industry has always had these small little spotty cycles. The one thing that everybody should remember that history has taught me in my whole channel is that the business always comes back. While dramatically reducing SG&A, which everybody will do, and dramatically reducing inventory levels and dramatically reducing marketing happens, it happens for a short period of time. To summarize, I expect there to be some more promotional activity while the headwinds pick up. I expect there to be more marketing while the headwinds pick up, and that it will normalize very shortly after that. Okay, great. Thanks. That's encouraging. You know, what do you think the latest is in terms of the consumer? You know, of course, interest rates, asset prices, sentiment, that may impact new and used units, but what about, like gas prices and whatnot for participation in the lifestyle such as miles driven or trips taken in RVs? Anecdotally, of course, I don't think that data really exists, but you know, how do you think demand at your retail store for like the consumables and sundries and collision and service is likely to track, you know, through 2023, et cetera, even if we have one of those, you know, downside 360 or so new unit forecasts that you threw out there? When we look at the downside 360,000 shipment forecast in our own model, not anybody else's, we still feel very comfortable that people that are already in the lifestyle. Let me clarify. For 40 years, the installed base of RVers has always gone up. There are certain years where it goes up more than others, but for 40 years it has always gone up. Our company, the reason we believe it's special is 'cause it largely focuses on that installed base, which is why our service business is good, which is why our used business is good, which is why our Good Sam business is good. What I believe sometimes happens is there's a slight pause with new entrants coming into the market. Slight pause. That's what creates the drop off from 460,000 to 360,000. While a hundred thousand is a lot, it's not a lot across 330 million people. What we have to do as an industry, which I think we've done as a company, is to be able to have a cost structure that can move in and out of that and to accept that there are going to be trough years and there are going to be peak years. When you look at the average of earnings and the average of CAGR growth over a five-year period, the cash flow and the returns on capital are phenomenal. I think that applies for the manufacturers. I know that applies for our business. Okay, thanks. Then last question, you know, I heard you say that you're being more selective with the allocation of capital, locking down SG&A to focus on the core business, et cetera. I'm sorry if I missed it, but how does that translate to the, you know, the RV sharing initiative, which is clearly in investment mode. I recall you were interested in this business not just for the maybe longer term profit potential of renting or brokering the renting of RVs, but also because of the synergy potential with the core business including used RV acquisition, et cetera. Is investment in RV sharing still a priority? Investment in anything at this point that doesn't yield us a super margin and a super return, like our used, our service, and our Good Sam business will be paused, has been paused. That doesn't mean that we're abandoning the idea. That doesn't mean that we are not going to revive it at some point. When I look at the total amount of capital available in our company, we need to get down to brass tacks, and that is making sure that we're keeping our employees healthy and safe and stable because they're the most important asset in our company. We have to look at their benefits, make sure their pay is in line with the market. We have to make sure our inventory is solid, that our lenders and our debts are being satisfied. We have to make sure that our dividend is being paid on a regular basis, and we have to make sure that we've stockpiled enough cash to make opportunistic acquisitions. I wanna make it more finite than that. If in a given 12-month period, we were gonna invest $4 million into any initiative of any kind, RV share, whatever it may be, I would rather hold those $4 million and wait for a location in a white space market to open up and buy that land and pick up $15 million of revenue and $1 million of earnings when the market turns, because the return on capital for that $4 million is better than any $4 million that I could spend. Okay, got it. Thanks for all the color. Next question comes from Brandon Rolle with D.A. Davidson. Please go ahead. Thank you for taking my questions. First, just on your mix. You know, this quarter you were 55-45 new to used. I know you wanna get closer to a 50-50 balance. Do you feel like you would reach that balance next year? Is there a chance moving forward maybe it tilts in the favor of used in the future? It's most important to me that we maintain our number one ranking as the new RV retailer in America, and I'm gonna hold on to that till the day I die. It getting to a 50/50 used goal is a goal, and really what it does is it forces us to focus more on used. We would never ever want to cannibalize or destroy our new business to achieve another goal. We would want to continue to grow our new business and grow our used business because we believe the addressable market for used is double that of the new market. The size of new RVs shipped out of the marketplace last year was 400 and some odd thousand. The number of used transactions and used units that traded hands was 900,000. We have to improve our market share by market on the used side, but not at the expense of our new business, at the benefit of growing our used business. I don't ever want anybody to think that we're trying to get to 50/50 by suppressing one and lifting up the other. If we get to 50/50, it's gonna mean that we continue to kick ass on the new side, and we've really dialed in the used business, not that we've gotten away from the new business. Okay. Great. Just on affordability, it seems like average selling prices for new vehicles continued to trend higher. Obviously, we're in a higher interest rate environment. How do you feel about affordability moving forward and maybe where pricing goes over the next 12 months? Part of the reason why we made this very strategic shift into used in the third quarter of last year is when we exited all those non-core RV categories from the outdoor space, we took that capital, and we started to put it into our used business 'cause we noticed that there was a return. The reason we did that is because we were starting to feel the pressure that the consumer would feel around the increases on new pricing. In order to maintain dominance in the marketplace, we needed to give, and will continue to give, the consumer an alternative. If you can buy a like asset that's one or two years older in a higher interest rate environment, you can offset that payment increase by selling them a unit at $2,000, $3,000, $5,000, $6,000, $7,000 less than the new unit would have been. We believe that the new manufacturers are doing a hell of a job trying to control costs that they're receiving from their own vendors, trying not to pass on incremental expenses to us. We also see their filings and their margins, and so we're not naive to the fact that their margins actually expanded. As the largest retailer of new RVs in America in an uncontrolled, unregulated industry, we will continue to not pay the same as a single point dealer. Because as the largest customer, we expect to get the best deal. We expect to pass those savings on to both our customer and our bottom line. Great. Just one last question. You know, given your greater focus on used vehicles, how do you feel about your new vehicle inventories right now? You know, are they where you wanna be, or do you feel like you know, you're a little under inventoried, over inventoried? Thanks. As we mentioned, I think we're sitting at about 182 units per location new on the ground. That's down from about 200, right? It's down from over 200. To be candid with you, I think Matthew, who is the absolute genius architect of what our inventory strategy has been, would probably want it to be 5 or 6 units less this time of year. In the fourth quarter, we have this really tough challenge of preparing for the selling season, where inventory is gonna go up. We wanna maybe try to widen the gap between what we historically had before the pandemic of number of new units per location and where we are today. Are we maybe a couple 1,000 units overstocked today from where we'd love to be? Sure. Are we gonna burn them and just take this absolute no margin approach? No. We'll be smart about what we buy and what we reorder, but we are not over-inventoried even by a little. Great. Thank you. Next question comes from Tristan Thomas-Martin with BMO Capital Markets. Please go ahead. Morning, everyone. Morning. Just one question. I think you called out you're getting 2,000 used leads a day. Do you have any data on whether these RVers are buying a new RV or maybe another used or perhaps leaving the lifestyle to do something else? Almost impossible to always discern exactly what the motivation is for every single customer. I could tell you en masse, when you look at our ability to source used assets, these are customers that are oftentimes, depending upon the season, looking to either reenter the lifestyle as they're heading into next year. For example, if an asset or a consumer comes to us in August, September, we could reasonably conclude that that same customer just doesn't want to incur the cost and expense with storage, and as such, they come to us to actually buy that asset from us, and then they'd be reentering the lifestyle by March, April of next year. There's always gonna be some consumers that just choose to exit the lifestyle, hopefully for a short time, because we see a lot of reentrance into the lifestyle on a consistent basis. Most are going to be attracted oftentimes in their childhood or as their kids continue to age out, and we see the style of RV that they reenter the market into being slightly different. I wanna just clarify this point and drive it home a little more. Almost 900,000 used RVs changed hands in this country last year, and a very small subset of them happened at the dealer level. The reason that we believe that our lead volume is growing and our used volume is growing is people are liking the values and the fairness and the transparency of our process and not having to have some stranger come to their house or put it in a classified ad or go through all the gyrations. Historically, dealers have tried to quote-unquote, "Steal the trade or steal the purchase." We've decided as a Good Sam company to put that process on full display. If you go onto GoodSam.com today, and I encourage people to do it, and you make up a name, and a unit, and a model, you will see what that process is like. I think consumers, based on the marketing that we made to them, are seeing that this is an easier way for them to monetize what was already happening in the marketplace. This idea that all these people are leaving the industry is just a false notion. It hasn't happened for 40 years. RVing isn't a fad. It existed when the interest rates were at 19%, it existed when there was a gas shortage, it existed when there was a war. It's always existed, and it's not going to go away. I think what has grown the market, and this is a very important point, what has grown the market is that we have very intelligent manufacturers like Thor and Forest River that are constantly investing their dollars into innovating products for the younger, newer buyer. Something you can tow with a lighter car, something potentially you could tow with an electric car at some point. That innovation, along with the historical traditional buyer, is what has allowed this industry to grow year after year after year. Got it. Thank you. Then, if I can kind of sneak in two more. Can you, what's your used units per location? Then also, are you still expecting to, I think last quarter you said 12-18 new locations next year. Is that still the target or has that gone down? Matt's gonna look up the number of used units per location, but I'm sure he'll punctuate it with, we still are understocked by location from where we wanna be on a used basis. In terms of opening locations, we are scheduled to open stores. We have some of them built. We are not going to open stores or spend any money of any kind until we have visibility into where we're going. If opportunistic acquisitions pop up, we are going to do everything we can to contractually lock that transaction up. We are in cash build mode and opportunistic acquisition mode. If we have stores that are finishing construction today, which we do, or some that have finished construction last month, which we do, we are locking that door and we are waiting until we have visibility so that no unnecessary dollar leaves our bank account when it doesn't have to. Hold on. Tristan, just to follow up on that inventory level per store. We're sitting at about 79 used units per store on a same-store basis right now. That's actually basically flat year-over-year. It's not enough. Okay. We're probably 10-15 units short per location. One of the strategies when we decide to get some of those stores open is we will be opening some standalone used stores. That we've made the decision on. There's no additional investment in that. It's just a mix and margin profile modification. We think the return on those stores will be pretty darn good. Got it. Thanks. Next question comes from Jim Chartier with Monness, Crespi, Hardt & Co. Please go ahead. Hi, Good morning. Thanks for taking my question. I just want to follow up on the last question. You know, used vehicles, you pulled back on inventory there during second quarter before starting to build back in third quarter, and it sounds like you're under where you want to be. You know, what, if any, impact did the pullback in inventory in 2Q impact your used sales in third quarter? And then, you know, what's the timeline to kind of get to that 10-15 more units per dealership that you'd like to have? I'd maintain that It's gonna be difficult to quantify that opportunity cost, but I could definitely confirm that we did give up some opportunity on used sales, especially in the early part of Q3. I think by the latter part of Q3, we started to pick up some momentum in the way of used sales, and that started to transition into October. My hope is that as we fast-forward throughout the entirety of next year, we continue to yield more and more results as we continue to be able to acquire more and more used. But over the past 12 months, we basically have just been able to procure just a little bit more used units compared to what we've been able to sell. We're constantly up against this battle to rebuild these channels and constantly be able to procure more as we're even expanding into more and more stores here too. We understand that this is really just the beginning of us continuing to aggressively pursue used assets in the name of fulfilling this ultimate goal of taking more market share in the used space. Great. It sounds like it's still pretty confident in the $3 billion used unit revenue or used revenue. You know, what's the timeline to get there at this point? Rather than giving you a timeline, which I know everybody wants, because that would be giving some sort of guidance, the fact that we are $400 million higher on a TTM today than we were back then gives us confidence that we have substantial momentum in achieving that. If you asked Matt and we weren't on a public call, he'd probably say a couple of years. I think we just got to be realistic that we're in an environment that has some uncertainty in the next five to six months. The used business will still be great, but it's not the momentum. We're looking for a little tailwind to get there. I think we'll be able to provide better clarity of that, probably six to eight months from now. Great. Thank you. There are no further questions at this time. I would like to turn the floor over back to Marcus Lemonis for closing comments. Thank you so much for joining us. I just want to reconfirm that our company is committed to making whatever changes it needs to make to our headcount, to our SG&A overall, to deal with whatever headwinds are in front of us. That in our 20 years of being in this business, headwinds happen. They don't last as long as people think they're gonna last. When they come back, when the market comes back, it comes back pretty fast. We look forward to reporting our next quarter here in February. Have a great holiday. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation. Have a great day.