LAZYDAYS ANNOUNCES $35 MILLION MORTGAGE LOAN FACILITY
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Insights
The $35 million mortgage loan facility secured by Lazydays presents a strategic financial decision aimed at bolstering liquidity while maintaining control over key dealership locations. The interest rate of 12%, notably higher than current average commercial mortgage rates, signals a risk premium possibly due to the specialized nature of the assets or the company's credit profile. Investors should note the maturity date in December 2026, which indicates a medium-term horizon for the company's leverage strategy.
The provision for flexibility in securing alternative financing arrangements suggests a proactive approach to capital management. This could mitigate risks associated with refinancing and interest rate fluctuations. However, the high-interest rate could also reflect tighter credit conditions or a higher risk assessment by lenders, which stakeholders should consider when evaluating the company's financial health and cost of capital.
Lazydays' decision to secure mortgages against dealership facilities and land earmarked for future development reflects a focus on real estate as a core operational asset. The company's strategy to own rather than lease these properties could safeguard against the volatility of rent expenses, which can be a significant factor in the retail and dealership industry. This move may also be indicative of a bullish stance on the value of their real estate portfolio, expecting it to appreciate or at least retain value over time.
However, stakeholders should consider the potential risks of tying up liquidity in fixed assets, particularly in a fluctuating real estate market. The balance between leveraging properties for liquidity and maintaining enough flexibility to navigate future market conditions will be crucial. The company's ability to secure alternative financing in the future could be affected by broader economic factors, such as interest rate trends and real estate market health, which are important for investors to monitor.
The facility provides both liquidity in the current operating environment and flexibility to secure alternative financing arrangements on a property-by-property basis in the future. Owning and financing dealership locations is core to Lazydays' strategy as it maintains site control and prevents fixed costs from increasing due to rent adjustments over time. This transaction allows the Company to continue to execute on its ownership strategy while providing liquidity as it locates other real estate financing, similar to the mortgages funded earlier this year in
Lazydays intends to use the net proceeds from the facility for general corporate purposes.
About Lazydays
Lazydays has been a prominent player in the RV industry since its inception in 1976, earning a stellar reputation for delivering exceptional RV sales, service, and ownership experiences. Its commitment to excellence has led to enduring relationships with RVers and their families, who rely on Lazydays for all their RV needs.
With a strategic approach to rapid expansion, Lazydays is growing its network through both acquisitions and new builds. Its wide selection of RV brands from top manufacturers, state-of-the-art service facilities, and an extensive range of accessories and parts ensure that Lazydays is the go-to destination for RV enthusiasts seeking everything they need for their journeys on the road. Whether you are a seasoned RVer or just starting your adventure, Lazydays' dedicated team is here to provide outstanding support and guidance, making your RV lifestyle truly extraordinary.
Lazydays is a publicly listed company on the Nasdaq stock exchange under the ticker "LAZY."
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward looking statements include statements regarding our goals, plans, projections and guidance regarding our financial position, results of operations, market position, pending and potential future acquisitions and business strategy, and often contain words such as "project," "outlook," "expect," "anticipate," "intend," "plan," "believe," "estimate," "may," "seek," "would," "should," "likely," "goal," "strategy," "future," "maintain," "continue," "remain," "target" or "will" and similar references to future periods. Examples of forward-looking statements in this press release include, among others, statements regarding:
- Our ability to find alternative lenders to provide mortgage financing;
- Anticipated lower ownership costs over time as a result of retaining ownership of our real estate; and
- Anticipated availability of liquidity from our operating real estate.
By their nature, forward-looking statements involve risks and uncertainties because they relate to events that depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance, and our actual results of operations, financial condition and liquidity and development of the industry in which we operate may differ materially from those made in or suggested by the forward-looking statements in this press release. The risks and uncertainties that could cause actual results to differ materially from estimated or projected results include, without limitation, future economic and financial conditions (both nationally and locally), changes in customer demand, our relationship with, and the financial and operational stability of, vehicle manufacturers and other suppliers, risks associated with our indebtedness (including available borrowing capacity, compliance with financial covenants and ability to refinance or repay indebtedness on favorable terms), acts of God or other incidents which may adversely impact our operations and financial performance, government regulations, legislation and others set forth throughout "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and in "Part I, Item 1A. Risk Factors" of our most recent Annual Report on Form 10-K, and from time to time in our other filings with the SEC. We urge you to carefully consider this information and not place undue reliance on forward-looking statements. We undertake no duty to update our forward-looking statements, including our earnings outlook, which are made as of the date of this release.
Contact:
Investor Relations
investors@lazydays.com
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SOURCE Lazydays
FAQ
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How is the mortgage loan facility secured?
What is the interest rate and maturity of the mortgage loan facility?
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