Third Quarter Financial Highlights:
- Total revenues decreased $17.4 million year over year to $448.8 million
- Construction Equipment and Material Handling revenues of $262.3 million and $168.9 million, respectively
- Product support revenues increased 7.8% year over year with Parts sales increasing to $75.6 million and Service revenues increasing to $64.6 million
- New and used equipment sales decreased 13.3% year over year to $219.8 million
- Net loss available to common stockholders of $(28.4) million
- Basic and diluted net loss per share of $(0.86)
- Adjusted basic and diluted net loss per share* of $(0.72)
- Adjusted EBITDA* of $43.2 million
- Third quarter 2024 net loss was impacted by a $14.0 million discrete tax expense from increasing the valuation allowance on our deferred tax assets, specifically related to 163(j) interest limitations
LIVONIA, Mich., Nov. 12, 2024 (GLOBE NEWSWIRE) -- Alta Equipment Group Inc. (NYSE: ALTG) ("Alta”, "we", "our" or the "Company”), a leading provider of premium material handling, construction and environmental processing equipment and related services, today announced financial results for the third quarter ended September 30, 2024.
CEO Comment:
Ryan Greenawalt, Chief Executive Officer of Alta, said "Our third quarter results continued to be impacted by the ongoing uncertainty in our end-user markets as it relates to customers committing to capital investment and purchasing new equipment. This dynamic has been most impactful in our Construction Equipment segment, where new and used equipment revenues decreased by $44.5 million, or 29.5%, from a year ago on an organic basis. Some customers put capital investments on hold in the third quarter while they waited for the election outcome and more clarity on interest rates. In the immediate aftermath post-election, it appears that sentiment has already improved, and we believe our customers will deploy capital more broadly in 2025.”
Mr. Greenawalt continued, "While the equipment sales market has been disappointing in 2024, our dealership model with diverse revenue streams has protected our overall business from equipment market cyclicality. As evidence, our steady and high-margin product support business continues to perform well with revenues increasing 7.8% to $140.2 million versus a year ago. Additionally, given our rent-to-sell approach to the equipment rental market we are able to react quickly to perceived softness by selling off lightly used fleet and right-sizing our balance sheet in an efficient manner, and we are proud of the progress we made with the balance sheet as reductions in rental fleet and working capital allowed us to reduce net debt by $38.7 million in the quarter. Additionally, demand in our Material Handling segment remained steady, with revenues increasing slightly to $168.9 million as we continue to work through a sizeable backlog. During the third quarter, we also began to see positive impacts from our business optimization initiatives, as we were able to reduce general and administrative expenses when compared to the first two quarters of the year.”
Mr. Greenawalt added, "Overall, while we and the overall equipment markets have underperformed initial projections for 2024, our expectations for 2025 are positive. In terms of our Construction Equipment segment, we expect the oversupply of new equipment to normalize in the first half of 2025 and construction equipment spending to be positively impacted by easing interest rates and more favorable lending conditions. Infrastructure related project pipelines continue to be significant and still in the early stages and state DOT budgets are forecast to remain elevated in 2025. The opportunities in our Material Handling business remain favorable as we believe our strong relationship with Hyster-Yale, unmatched product support capabilities and resilient and diversified end markets will result in continued gains in market share in 2025. Lastly, we expect our electric vehicles business to gain further traction in 2025 as customers begin the transformational shift to electrify commercial vehicle fleets. Given this perspective on our future prospects, our Board of Directors has expanded our share buyback program to $20 million which we will deploy to support shareholders should opportunistic dislocations between the Company's long-term intrinsic value and our share price present themselves.”
In conclusion, Mr. Greenawalt said, "Despite a challenging market in 2024, our 3,000 employees have demonstrated unprecedented dedication to our business and our customers. I am extremely proud of their commitment to our guiding principles which are predicated on teamwork and fostering customers for life.”
Full Year 2024 Financial Guidance and Other Financial Notes:
- The Company updates our guidance range and now expects to report Adjusted EBITDA between $170.0 million and $175.0 million for the 2024 fiscal year.
- Reduced rental fleet original equipment cost from $617.2 million as of June 30 to $599.0 as of September 30.
- Reduced Adjusted total net debt and floor plan payables from $858.1 million as of June 30 to $819.4 million as of September 30 (see Reconciliation of non-GAAP financial measures below).
| CONDENSED CONSOLIDATED RESULTS OF OPERATIONS (Unaudited) (amounts in millions unless otherwise noted) | ||||||||||||||||||||||||||||||||
| Three Months Ended
September 30, | Increase (Decrease) | Nine Months Ended
September 30, | Increase
(Decrease) | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 versus 2023 | 2024 | 2023 | 2024 versus 2023 | |||||||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||||||||
| New and used equipment sales | $ | 219.8 | $ | 253.6 | $ | (33.8 | ) | (13.3 | )% | $ | 699.9 | $ | 727.8 | $ | (27.9 | ) | (3.8 | )% | ||||||||||||||
| Parts sales | 75.6 | 69.5 | 6.1 | 8.8 | % | 226.5 | 209.2 | 17.3 | 8.3 | % | ||||||||||||||||||||||
| Service revenues | 64.6 | 60.6 | 4.0 | 6.6 | % | 194.8 | 180.5 | 14.3 | 7.9 | % | ||||||||||||||||||||||
| Rental revenues | 53.7 | 54.0 | (0.3 | ) | (0.6 | )% | 155.9 | 147.1 | 8.8 | 6.0 | % | |||||||||||||||||||||
| Rental equipment sales | 35.1 | 28.5 | 6.6 | 23.2 | % | 101.4 | 90.7 | 10.7 | 11.8 | % | ||||||||||||||||||||||
| Total revenues | 448.8 | 466.2 | (17.4 | ) | (3.7 | )% | 1,378.5 | 1,355.3 | 23.2 | 1.7 | % | |||||||||||||||||||||
| Cost of revenues: | ||||||||||||||||||||||||||||||||
| New and used equipment sales | 184.4 | 212.0 | (27.6 | ) | (13.0 | )% | 588.7 | 601.3 | (12.6 | ) | (2.1 | )% | ||||||||||||||||||||
| Parts sales | 50.0 | 45.3 | 4.7 | 10.4 | % | 149.2 | 138.2 | 11.0 | 8.0 | % | ||||||||||||||||||||||
| Service revenues | 26.3 | 26.5 | (0.2 | ) | (0.8 | )% | 80.2 | 77.0 | 3.2 | 4.2 | % | |||||||||||||||||||||
| Rental revenues | 5.6 | 5.7 | (0.1 | ) | (1.8 | )% | 18.5 | 18.0 | 0.5 | 2.8 | % | |||||||||||||||||||||
| Rental depreciation | 30.6 | 29.6 | 1.0 | 3.4 | % | 88.5 | 80.1 | 8.4 | 10.5 | % | ||||||||||||||||||||||
| Rental equipment sales | 27.3 | 21.0 | 6.3 | 30.0 | % | 76.2 | 66.5 | 9.7 | 14.6 | % | ||||||||||||||||||||||
| Total cost of revenues | 324.2 | 340.1 | (15.9 | ) | (4.7 | )% | 1,001.3 | 981.1 | 20.2 | 2.1 | % | |||||||||||||||||||||
| Gross profit | 124.6 | 126.1 | (1.5 | ) | (1.2 | )% | 377.2 | 374.2 | 3.0 | 0.8 | % | |||||||||||||||||||||
| General and administrative expenses | 110.6 | 106.8 | 3.8 | 3.6 | % | 339.7 | 316.0 | 23.7 | 7.5 | % | ||||||||||||||||||||||
| Non-rental depreciation and amortization | 7.2 | 5.4 | 1.8 | 33.3 | % | 21.3 | 16.0 | 5.3 | 33.1 | % | ||||||||||||||||||||||
| Total operating expenses | 117.8 | 112.2 | 5.6 | 5.0 | % | 361.0 | 332.0 | 29.0 | 8.7 | % | ||||||||||||||||||||||
| Income from operations | 6.8 | 13.9 | (7.1 | ) | (51.1 | )% | 16.2 | 42.2 | (26.0 | ) | (61.6 | )% | ||||||||||||||||||||
| Other (expense) income: | ||||||||||||||||||||||||||||||||
| Interest expense, floor plan payable - new equipment | (3.2 | ) | (2.4 | ) | (0.8 | ) | 33.3 | % | (8.7 | ) | (5.8 | ) | (2.9 | ) | 50.0 | % | ||||||||||||||||
| Interest expense - other | (19.4 | ) | (12.8 | ) | (6.6 | ) | 51.6 | % | (49.2 | ) | (35.1 | ) | (14.1 | ) | 40.2 | % | ||||||||||||||||
| Other income | (0.3 | ) | 1.4 | (1.7 | ) |
| ||||||||||||||||||||||||||