Arizona Car Wash Wants to Be State’s Next Public Corporation

By on June 22, 2021 0 60Views

A company that aims to put a shine on your car and a smile on your face could become Arizona’s newest public corporation.

Mister Car Wash Inc. has filed paperwork to raise about $465 million by selling 31.25 million shares to the public, in addition to 6.25 million shares to be sold by corporate insiders. If the stock sale goes through, the company’s shares would trade on the New York Stock Exchange, possibly by Friday and likely under the symbol MCW.

The company plans to use its proceeds to pay down debt and for general corporate purposes.

Mister Car Wash would be the second Arizona-based corporation of size to go public this month, after a sale of more than $700 million in stock nearly two weeks ago by Scottsdale-based LifeStance Health, which operates mental-health clinics.

The company, headquartered in Tucson, claims to operate the nation’s largest chain of car washes. Of the 344 company locations spread across 21 states, Texas has the most at 65, California is next with 37 and Florida third with 30. Arizona has 15 locations.

“At the core, we are in the service business with a love and passion for washing cars, taking care of our customers and delivering happiness,” wrote CEO John Lai in a letter contained in the stock-offering documents filed with the U.S. Securities and Exchange Commission last week. “We are unified in our purpose of inspiring people to shine, which conveys our dual objective of improving the lives of our people and helping our customers feel good about themselves.”

Getting a car washed, he added, is a “sensory experience” that “creates a magic, feel-good moment.” Mister Car Wash counts about 3,500 full-time employees across the nation, along with more than 2,000 part-timers.

Since its founding in 1996, Mister Car Wash claims to have washed 345 million vehicles. Its core pillars, as discussed in the stock-offering documents, consist of “providing elevated hospitality to our guests, delivering the highest quality car wash and ensuring the experience is quick and convenient.”

Some 1.4 million people participate in a subscription program called the Unlimited Wash Club. These repeat customers account for 62% of the company’s wash revenue.

The company also claims to be an environmental steward that recycles about one-third of the water used in the wash process. People cleaning their cars at home use about three times the amount of water per wash, the company estimates.

Mister Car Wash generated $24.6 million in net income on $175.5 million in revenue during its most recent quarter ending March 31. Those results were up from a profit of $8.9 million on $155.3 million in revenue during the pandemic-impacted first quarter of 2020. The company prices its typical base exterior wash at around $8.

The company was hurt by the COVID-19 pandemic but rebounded with an 18.6% gain in comparable-store sales in the first quarter of 2021. Before 2020, it claims to have logged 39 consecutive quarters of positive comparable-store sales gains operating in the $11 billion car-wash industry.