Legacy Housing Corporation (NASDAQ:LEGH) Q1 2023 Earnings Conference Call May 10, 2023 11:00 AM ET

Company Participants

Duncan Bates - President & CEO

Max Africk - General Counsel

Conference Call Participants

Alex Rygiel - B. Riley

Mark Smith - Lake Street

Leanne Hayden - EF Hutton

Duncan Bates

Good morning. This is Duncan Bates.

Operator

Yes. You go ahead, sir.

Duncan Bates

We're get to go.

Operator

Yes. We're get to go.

Duncan Bates

All right. Good morning. This is Duncan Bates, Legacy's President and CEO. Thanks for joining our First Quarter 2023 Conference Call. Max Africk, Legacy's General Counsel will read the Safe Harbor disclosure before getting started.

Max Africk

Thanks, Duncan.

Before we begin, may I remind our listeners that management's prepared remarks today will contain forward-looking statements, which are subject to risks and uncertainties, and management may make additional forward-looking statements in response to your questions.

Therefore, the company claims the protection of the Safe Harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may vary or differ from management's current expectations, and therefore, we refer you to a more detailed discussion of the risks and uncertainties in the company's Annual Report filed with the Securities and Exchange Commission.

In addition, any projections as to the company's future performance represent management's estimates as of today's call. Legacy Housing assumes no obligation to update these projections in the future, unless otherwise required by applicable law.

Duncan Bates

Thanks, Max.

I'll run through our prepared remarks then we'll open the call for Q&A. Product revenue decreased to $43.3 million or 16.4% in the first quarter of 2023 compared to the first quarter of 2022. The decrease primarily resulted from a reduction in shipments across all three plants. Also, we did not convert any independent dealer consignment agreements to floor plan financing agreements during this quarter, as we did most quarters last year.

The manufactured housing industry has slowed. According to MHI's March 2023 data March shipments were up over February, but still well below 2022 numbers. We believe that our business has fared better than most. We made a big push on sales this year and have a nice backlog at all plants.

Several longtime customers have stepped up with large orders. We have a small manufacturing footprint and continue to run near capacity. We anticipate having orders to feed all three plants. We also believe that there are several major tailwinds for our industry as housing affordability nears record lows.