Legacy Housing Corporation (NASDAQ:LEGH) Q4 2022 Earnings Conference Call March 16, 2023 11:00 AM ET

Company Participants

Duncan Bates - President and Chief Executive Officer

Max Africk - General Counsel

Conference Call Participants

Min Cho - B. Riley

Mark Smith - Lake Street Capital

Tim Moore - E.F. Hutton Group

Brian Glenn - Olcott Partners

Operator

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Legacy Housing Corporation Fourth Quarter 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please note that today's conference is being recorded.

I will now hand the conference over to your speaker host, Mr. Duncan Bates, President, Chief Executive Officer. Please go ahead, sir.

Duncan Bates

Good morning, everyone. This is Duncan Bates, Legacy's President and CEO. Thanks for joining our call today. Max Africk, Legacy's new General Counsel will read the safe harbor disclosure before getting started. Max?

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 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. We're happy to have you on the team. I'll run through our prepared remarks on Legacy's 2022 financial performance and provide additional corporate updates. We will then open the call for Q&A.

2022 was a record year for Legacy Housing. Net revenue increased to $257 million in 2022, representing a 30.1% improvement over 2021. The increase resulted from several price increases implemented from 2021 to 2022, the conversion of certain independent dealer consignment arrangements to financing arrangements, offset by a decrease in shipments from our Eatonton, Georgia facility.

As we discussed on the third quarter call, we delayed shipments and slowed production to improve the quality and consistency of homes manufactured at our plant in Eatonton, Georgia. During the fourth quarter, we rightsized the workforce, brought in a third party to retrain the team in certain manufacturing stations and significantly improved quality. Production is still below historical levels, but we are making progress without sacrificing quality.