Although the now-defunct Destinations RV dealership chain accounted for 13% of SMC Corp’s sales revenue during 2000, the closure “is not expected to have a materially adverse impact” on SMC, according to a Securities & Exchange Commission (SEC) document filed last week by SMC.
Destinations RV closed on Dec. 6 after its owners ran out of cash. The dealership’s locations were in Bend and Coburg, Ore., and Fife, Wash.
Destinations RV accounted for 12% of SMC’s sales in 1999, when SMC’s revenues totaled $215.5 million. SMC’s year 2000 sales revenue figure is not currently available, but its sales totaled $148 million during the first nine months of last year.
The floorplan lenders for Destinations RV included Deutsche Financial Services (DFS) and Conseco Financial, and their agreements with Destinations RV required SMC to buy-back its units if Destinations RV went out of business. The repurchase agreements covered 44 of SMC’s Class A motorhomes and 11 units that are subject to a limited guarantee.
As of Jan. 10, the date of the SEC document filed by SMC, it had transferred 19 motorhomes, worth around $2.5 million, to another dealer, that was not identified.
SMC also owns the property in Bend, Ore., where Destinations RV operated, and SMC hired several former Destinations RV sales people “until a replacement dealer is found.” As of Jan. 10, the former Destinations RV employees had sold six SMC motorhomes for around $900,000.
SMC also “entered into negotiations with several established dealers and other parties concerning the Beaver and Harney franchises available in Bend, Ore., and in Washington.” SMC believes it will have new dealer franchises established by the end of February, according to the SEC document.