Legacy Housing Corporation (NASDAQ:LEGH) Q1 2024 Earnings Call Transcript May 10, 2024 11:00 AM ET

Company Participants

Duncan Bates - President & Chief Executive Officer
Max Africk - General Counsel
Jeff Fiedelman - Chief Financial Officer

Conference Call Participants

Alex Rygiel - B. Riley Securities
Mark Smith - Lake Street
Jay McCanless - Wedbush

Operator

Good day and thank you for standing by. Welcome to Legacy Housing Corporation Quarter One 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Duncan Bates, CEO. Please go ahead.

Duncan Bates

Good morning. This is Duncan Bates, Legacy's President and CEO. Thank you for joining our first quarter 2024 conference call. Max Africk, Legacy's General Counsel, will read the safe harbor disclosure before getting started. Max?

Max Africk

Thanks, Duncan. Before we begin, I will 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 contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from management's current expectations and any projections as to the company's future performance represent management's best estimates as of today's call.

Duncan Bates

Thanks, Max. I'm joined today by Jeff Fiedelman, Legacy's Chief Financial Officer. Jeff will discuss our first quarter performance, then I will provide additional corporate updates and open the call for Q&A. Jeff?

Jeff Fiedelman

Thanks, Duncan. Product sales primarily consist of direct sales, commercial sales, inventory finance sales and retail store sales. Product sales decreased $12.5 million or 28.8%, during the three months ended March 31st, 2024, as compared to the same period in 2023. This decrease was driven by a decrease in unit volume shift, primarily in direct sales, mobile home park sales and inventory finance sales categories. The decrease was offset by increased sales at our company owned retail stores.

For the three months ended March 31st, 2024, our net revenue per product sold decreased primarily due to a shift in product mix to smaller units into a large sale of homes from our leased home portfolio to a mobile home park customer at a lower average price than our typical new home. Consumer MHP and dealer loans interest income increased $2.9 million or 38% during the three months ended March 31st, 2024, as compared to the same period in 2023 due to growth in our loan portfolios. This increase was driven by increased balances in the MHP, consumer and dealer loan portfolios. Between March 31st, 2024, and March 31st, 2023, our MHP loan portfolio increased by $28.2 million.