ALTG - Earnings call 3 2023 | Alta Equipment Group Inc.

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Operator

Good afternoon, and thank you for attending the Alta Equipment Group Third Quarter 2023 Earnings Conference Call. My name is Matt, and I'll be your moderator for today's call.I will now turn the call over to Jason Dammeyer, Director, SEC Reporting and Technical Accounting with Alta Equipment Group.

Jason Dammeyer

Thank you, Matt. Good afternoon, everyone, and thank you for joining us today. A press release detailing Alta's third quarter 2023 financial results was issued this afternoon and is posted on our website, along with a presentation designed to assist you in understanding the company's results.On the call with me today are Ryan Greenawalt, our Chairman and CEO; and Tony Colucci, our Chief Financial Officer.

will financial a results. management third of call, XXXX quarter today's first review provide our For

both get to We and before call company in about call statements we future we begin may open I'd growth, the will economic with of related and and to our are release. statements, our achievements statements those the described for business other and uncertainties some contain outlook, as certain financial your market including risks, this results, everyone forward-looking press financial that remind These prepared subject including forward-looking general and known remarks unknown nonhistorical started, conditions. opportunities assumptions, conference like and statements questions.Before strategy Alta's business to

these of our projections on based have may current financial that largely results statements future about our we forward-looking and operations. and affect condition trends believe and events financial expectations business, We

at press we today's release release issued press is GAAP and will of that Ryan. believe financial be revise these are we turn filed these including investors.altaequipment.com.I our measures. undertake to from reports cause Descriptions we risks occur reconciliation now this and SEC, over are in to both today.During reasonable, that the can actual may statement on other of differ statements in this that changes was GAAP call, present discussed call. any A Although non-GAAP these materially to the with after measures our could obligation to expectations website results our no and forward-looking to included reflect call found non-GAAP

Ryan Greenawalt

and today. everyone, afternoon, thank you Good us Jason. for you, joining Thank

that act would affected dedication, record condolences recognize because their has to those of Before operated, struck without I where all have tragedy to Maine, of Also, long hard the our we performance work possible. employees by our we and extend our be recent senseless light want heartfelt in I Lewiston, the to begin, continued violence. not want

Demand are the Our members are pain review with These with loss.I grappling third user highlights. and their the and available and quarter financial remained on quick Slide community on solid. $XXX.X million. website. with respectively. prayers begin and victims, found Total families profound of markets presentation our XX.X% a year-over-year $XXX.X end all the revenue made million, our our of to Construction increased now Handling thoughts who Materials in million $XXX of the increased X to revenues are and will

with $XX.X sales to New XX.X% to year-over-year million million.Product sales increasing and XX.X% service $XXX.X equipment to revenues and revenues used parts grew increasing increased support million. $XX.X

to increase continue technicians. our had quarter We trained at And factory more we field than X,XXX end, population.

to see XX.X% tremendous performance the resiliency we contributions adjusted a includes segment, As we to $XX macroeconomic in Construction experienced grew from major our like organic environment, our result to in strong of has demand especially highlight our business the diversified of EBITDA as well the growth, Florida, which million.Despite continue which as markets in acquisitions solid would serve. growth. segments, I our

of myriad turf scrap on mining has beyond goes large-scale markets, demolition that despite brought the and applications capabilities from commercial we've Construction segment, and housing and investments power far into have only maintenance extend there. a or Our relationships its operations, that aggregate name, list generation, and road, projects.The extend made and

segment this We are focused on going further forward. expansion of

material continue remained for to improve. equipment see are our handling strong. Demand happy supply We chains to also

a us further outpace locations turf and construction to equipment metro other compact fragmented acquisition Burris strategy, evident market upon terms highly and in supplier of segment remains at customer it purchase Growth in and Equipment Our premier our Illinois. our remains sentiment market we coverage closed of with On executing gives growth are and construction penetration of the our continues backlog compact objectives. equipment Chicago we level and our the is X, talented October equipment record X acquired of a Company, segments. the privately favorable.In in brings in XX, transaction with market it This quarter, with a growth. relationships.In second and first distributor our long-standing group meets a November end is we in on in the a equipment Alta's region.This Ault This deal of in Industries, with objectives of in held investment Quebec. Ontario Equipment the experts segment. region has Canadian locations customer the growing several high-performing our for dealership strategic built market Canada Alta Construction that a for space, aggregate of mining

with with a gaining infrastructure are to potential market to and OEMs correlated a investment. highly in installed First, base portfolio top-performing growth existing poised of exclusivity an we grow and the for

equipment Second, sales. engineered on end for highly specialized markets, margins unique is and to greater this for allowing segment equipment

business Lastly, total from the our of strategy through forward.These are repair and revenue in immediately is public million Since replacement added in further benefit for have likely product will support M&A $XX and and screening $XXX adjusted periodic of and process stream nature in of a This heavy-duty parts growth and going the revenue organic we million crushing poised creates accretive. steady sales offering our transactions services. XXXX, EBITDA. maintenance

path user strategic and follow transactions. recent We to our evidenced network have as this these dealership end we'll entered as well expanded as by markets, new continue

opportunities. to Our platform us significant organic also access gives

we Central and equipment announced both Western through financing, service areas locations with residential of touch Alta's the construction further success initially to to XXXX.Serving culture. OEM made and and compact in full like support. again as supporting and demonstrates issues planned now and complementary sell further surrounding enter partners.Lastly, the in consolidation for appointment our Alta's Cranberry dealership are strategically Central contractors, including Pennsylvania, value serving Pittsburgh and infrastructure into market services, bring dealer of our attachments as subcompact nonresidential and succession and plans lineup corporate & of Delmont OEMs and construction, CASE and on parts well will excited I'd Pennsylvania in planned Power power as expand will locations platform Township today, and Equipment this telematics the through possible heavy, provide X maintenance As the dealer to solutions, captive and where demonstrated to operate we CASE Pennsylvania we general

As and a difference. rally business valued to want every thank our employees opportunity, day and of foster to strive trust our purpose, and delivering empowerment, I a our to we our the a shareholders. to trust we culture makes accountability shared around partners company, customers, delivering that again for

is these purpose areas. shared commitment our the of key Our foundation to

day.In and inclusive and culture sustainability, the and solutions, various of that turn dedicated Our environmental including like each commitment the our commercial a work safety in strategy the to and develop viability we Colucci, to to our electromobility call employees to Tony quarter. adoption to solid technicians continue I'll now hard all Alta drive your closing, And over the customer another I'd CFO. focused thank team for of delivering

Anthony Colucci

for Good thank you interest Equipment and Ryan. and evening, Alta everyone, Thanks, Group quarter results. third your our in financial XXXX

today to future we Before team on build each I Illinois look to focus begin, in the in a forward X welcome want Equipment bright companies, together from of of and and areas. legacy those to The team Canada upon Industries remarks our Burris will new great is the Ault members senior one family. excited team.My I as to leadership Alta

year comps end briefly First, availability equipment benefit in quarter strong product I'll high-margin from adjusted business and I'll guidance for the on EBITDA fiscal business. third historical in XXXX. our to demand be increased face increase support as organic to our also our to results, of market continues presenting the which continue growth our outpace touch

overall walk I'll acquisitions, at contrast recap of the Alta and profile is their through versus Second, each we of QX economics IPO the of financial years X who today on on the who X I'll the presenting business.Lastly, impact aforementioned the of and in past XXXX. be February were our Ault, Burris and a

the As capital notable part X I'll on that over summarize return years. past of discussion, metrics

my said, I the performance. the on everyone should our website throughout be portion presented Slides noted deck, XX-Q, which my our it today's XX I'd to quarter referencing Relations slides call altg.com.With earnings as on remarks encourage first of prepared that and in for talking to get XX Investor that available in to will and be investor presentation third is from I at our presentation call today. Before our review the points,

million, the $XXX in against quarter, $XX $XXX quarter recorded --revenue the company $XX difficult Embedded million QX million more a increasingly the strong of XX%, is for the quarter up is comparatively million year. $XXX revenue which over comps. organic of XXXX, For million for of last QX near making increase a versus

perspective, up last the and departments first lines. and more revenues comp $XXX.X rental the up million operating of trailing economic as conversion lines hurdles relates leverage Specifically, we high-margin strongest equipment unlevered to business, as approximately 'XX sales pro quarterly as were incremental forma cash growth million achieved into free continue end, flow last Northern year-over-year. million saw the is approximately $XX growth to we expected basis, $XX parts support our which $XX $XXX $X.X up increase quarters represents versus adjusted ultimately will adjusted our up our for quarter, XXXX.Moving getting that it million the million which population of an of bode support and XX% on second EBITDA, $X the equipment million, to support approximately quarter the of To year difficult, well revenues more from On a close a rate EBITDA. and the year $XXX rental million million of our To field year. versus function quarter, which we our business EBITDA realize the for quarter revenues. placed year-to-date, $XXX.X our when In from service million revenue of on in EBITDA realization million adjusted rental to organic out to converted XX now we million realized future product QX as compared EBIT, in product for in of into for organic $XX natural compared when basis, of for we've a product spite version for quarter on regions.From $X typically hit to the QX X of quarter the increased level last

Lastly, to on year-to-date flows. are this for mentioned fiscal cash solid raising a our release, expectations of a year $XXX adjusted range acquisitions closed the million press million guidance EBITDA, X we the today's to and for quarter, XXXX.On as performance, EBITDA of and $XXX that were given to QX in

forma As flow to just of common on investor growth depicted basis, in million equity to deck, cash a available metric XX as pro is generating common to free levered later. to normalized our holders. business prior equity this metric annualized akin More view the CapEx, on $XX we earnings a Slide economic above on

quarter.Lastly, million $XXX million approximately on availability revolving total Moving with facility at in sheet. summary, balance the to leverage with We ended leverage credit suppressed EBITDA. $XX of and in In inventory $XXX at XXXX of as I on roughly the end X.Xx at and both in note flattening our came quarter line the the adjusted level came of similar $XXX we to with ended million last on wanted of in QX balance to liquidity our levels inventory QX. the inventory quarter-over-quarter versus million sheet,

normalize working As to the other floor participants, began on of redeployment mentioned inventory an unprecedented in put previous like industry many Alta, of of the lines. 'XX, pressure calls, plan in and saw to as replenishment first end XXXX, of half led equipment level chains supply capital which at

we the replenishment on and my recently of equipment of some we to revenue this an approximately and our in acquisition and we incremental adjusted history Burris As $XX seen feel This given EBITDA basis. portion KPIs the inventory expected financial on of second mentioned on, Currently, acquisitions $X.X an just back completed normal turnover.Moving pace Burris quarter, I in we the to In acquisition annualized on Ault. October, and of of adds QX. closed the benchmark Equipment. moderate commentary have million half that year, million X of our prepared within remarks, incremental levels are our both significantly last on expected that comfortable we now we second range the of

accretive for segment equipment an revenue we metropolitan acquisition immediately compact annualized of November of price As to Toronto. infrastructure and $XX of our adds At dollars. incremental Chicago. to Ryan profile.On adjusted with mentioned, purchase and this Ault an U.S. on is our Montreal to talent shareholders the acquisition $XX X, million, of important X.Xx a leverage adds Industries in total and million in $X our completed operations incremental close million in This and acquisition deal basis EBITDA

and and segment our acquisition market-leading As in noted, screening with the investment crushing our a CE equipment OEM. represents aligns Canada first us in

The ago million In to the a million reflect portion a ALTG and a cut accretive And IPO company working out for plan recap I'd cash our partnership sellers terms over comes February at tenor our commitment to my years excess incentivized our XXXX. were new numbers where vesting profile.Now leverage was at shares execution agreement beginning us our with prepared million and that stands $XX.X purchase stock, it of that's is relentless of to as partners laid and the the we of structure, the a accretive of the vision X-year today ensures seller of price, and in Alta were remarks, pursuit time investors seller net and fully shareholders. $XX.X the note $XX to culture This importantly our versus share $X.X X-year employment was of employees like frame. immediately close, Burris, of true final is like valued and impressive going and where our X forward. XXXX. $XX to was a for aligned In in it just mimics million in into structure which of the capital, at the at when of we our important view, the are

since now our Slide on doubled multiple size business based depicted points. we the formally of As have XX, IPO on data the

at increased in As $XXX midpoint from to can XX from of million see, to gone gone guidance EBITDA operating you XX $XXX our range. from million billion, $X.X the new locations over to $XX we've and in million revenue

and U.S. from the our skilled of major the states XX X mechanics. we've X,XXX in gone XXX major operating to Canada X from XX from And X,XXX all Additionally, members to over in segments. provinces team approximately X,XXX and states gone we've in to in

generating since on that the we're and will investments performance yield, on ROIC mind, market aligns for a our in our Slide at believe Slide investment, our program's both both Slide return over $XXX and are and of that ROIC.In has bottom which presented we million and drive the been on been capital highly EBIT in shareholders. the And view results on past capital, IPO we with fully business. economic X senior years. what the way. good we So economic hyper also the you earned of we've is IPO impressive of yield, have I capital we've Alta's we appropriate is cap capital that the the investments the the which focused All heavily returns on would a for to themselves, performance through the deploy deployed. via returns acquisitions.To XX.X% organic XX, M&A IPO historic since And the note most XX, metric both is on returns With version end, investors incentivized us speak for note proud come end, I these ultimately and or reference as have our our invested our told, EBIT deployed and executive between team growth the so comp today. accomplishments. of organic and management strategic along disconnect as investors XX, since When weighted

This metric a $XX at that and X.Xx to basis on to the or cash million grown $X.XX minimal IPO. of compares the is reverse we the XX% now IPO.So As Alta's to along previously at of equity per share way. at in dilution per on reference trades summary, share. metric side equity flow of X $X.XX equity generating cash years have this the approximately the free this point, company that with in mentioned, on annual an as time versus flow is X% say free the metric The now metric this to

on grow are understand focused and we creating will existing demonstrated have with optimizing happy Alta's of years.In season. I be flows strategic we our disconnect capacity the of great a Alta to customers be coming being a holiday own value believe capital, flow While you and I streams it we time our to Q&A. the our and over cash thank ebbs And for the and as weeks, XXXX, to employees, shareholders head we into a past your cognizant for and our for over we the laser what attention, as of by uncontrollable the more my strong markets, in upcoming to to equity fair opportunistic and we operator for finish OEMs Thank of highly equity. colleagues looking will the the I'd turn and to forward X back wish all like closing, and I'm for year QX.

Operator

[Operator from with Rygiel Alex of line Riley. Instructions] the The B. first question is

Alexander Rygiel

Gentlemen, and Tony. Congrats. quarter. Ryan great

you about So last could general on changed customers how kind about And XXXX. interest growth as they we talk outlook rates saying have in then your a are few approach order how of XXXX, organic the purchase might can any for thoughts impact other XXXX? that over And months? what plans bit book, higher and

Anthony Colucci

when I'm sales Sure, the is book you Alex. backlog, correct, customer This assuming mean Tony. on of equipment? purchasing versus our with say kind own order side you book, order

Alexander Rygiel

Correct.

Anthony Colucci

Yes.

having got if large dozens, by in large recently where yes, So you segment, little that customers we backlogs such here segment a side, is Construction ground, results is equipment -- which of have good need Material the the on the to fleets on buying Handling why like seeing bit you're not versus inventory sales more the the we the Alex, have -- hundreds. you've

and to just yet on described, factors On with, of say customers the to forth. that related a into we equipment. rates, interest I so cancellations material you so will have amount forklift inflation, of Material is, what record terms see in and would a backlog material go Handling side, XXXX And we handling

equipment to of a on in we on market large that side, about So or specifically, Material should base in of Construction be as point end DOT visibility up as that really and whether it's go backlogs contractor of mentioned, side, they're our it in. around say, we we're commercial even XX% year, up feel different regions as hard point wrapped work, good more or I we the highlighting have budgets the still Handling.And sales in an kind the to have doesn't work. specifically Ryan XX%, aggregates markets a -- or that of the mining, for DOT And made kind

harvest least XX% sold expect we've ever not the revenue line, and so at the grown that as can 'XX just segment, high sentiment -- I headed a parts good on to in Construction we don't if revenue I Certainly, that change next we in same factors on try head we here. equipment from increased the about kind the macroeconomic been organically or 'XX to pretty headed that annuitized here of lot there digits X that years. think of it I've 'XX, to we've more as and we would side. equipment if service think And single into into comes that's feel especially the -- out change.When the year streams we've

So yes, I think leave that's how one. I'd that

Alexander Rygiel

then, going in the quicker. you that be little generally business you growing bit I the margins organic a lot that comments that business? equipment specialty a Can was like by and to more you're about higher intrigued through M&A And sounds definitely that a some and on about of talk your bit capture Ryan, side, methods

Ryan Greenawalt

the the to Alex, Sure. landscape market, the lower -- the the be. margins commoditized lower your competitive more of the rule going is more that the are thumb and of sort

less landscape. field application, playing competition. that a other higher was made are that terms it I to specific margins of sort then And narrower type the the there's makes It's of because the competitive support in on the just So towards which comment be about yield engineered product of more going a equipment.

equipment. support what up it imagine on the and very doing, equipment the yield you aggregate, if handling material high heavy parts stone, it's chewing has is So product a basically the

Anthony Colucci

applications, stone. sort equipment And about pretty perspective niche of good the And terms I the Ault think specialized Ecoverse's a of a on you products Alex, look and are Ecoverse represent lot can specialized you're they the that. that would yes, akin of difficult like imagine, to a crushing from way much A-U-L-T, rock will in referencing that Ault, used can as -- very and command margin those products. margin income you statement because in

Alexander Rygiel

Very helpful.

Operator

Matt the D.A. from Next line question Summerville with is Davidson. of

Matt Summerville

you couple there? new what about of Can maybe in then what you're of questions. talk 'XX pricing also, and and seeing is thought terms used your into A equipment heading and there. utilization? high rental And you would helpful what then can in year next into any a fleet touch be rental follow-up. I level have you're And seeing again, on rates And

Anthony Colucci

This Matt. Sure, is Tony.

buckets of see, level, there -- what I try I'll see level increases. hold in just emphasize continue we to we you is to And say, And think if can here, new take different. would is our that equipment, to inflationary just you try quarter I margins those always no kind I ultimately. CPI this in

I and at quarter. XX% the quarter on think for ended new used we combined the

of certain the moderation Handling in we have get not we're industry, products. sit unlike of beyond nothing segments lot kind up of that seeing Material so inflation OEM the for are that and seeing say the equipment, we product publications in what on the segments even but Construction decreasing and to customer, kind equipment.I in typical speak of -- And rest will you're new the to between really portfolio or a industry of the used of --

moderation way. definitely have that some So seen

we financial both out some definitely used meaning in utilization sort And new as auction for of rather retail XX-ish equipment, are always XX% of be the trends not on our have utilization. to but of we'd kind on XX%, striving sort we based into material there side, return to 'XX.On may on are And things good of any but and to that seen we the the continue way moderation those continue, of earn way industry can to a like use Some publications I as resort, would expect we that well. auctions pricing. used that last

fleet, high -- up we're try drive roughly million and on And about versus X% want got line today We've deck be. $XXX-ish rent-to-rent it's to we as that's kind rates, to think in Rates rental year. of as -- so last possible. the we million we published want that a $XXX I were that And to annualized, think on always the where XX%. I running

so our we as needed. answer stick continue rate 'XX, into to scale and but scale relative fleet 'XX a rent rental categories, in to a KPIs demand. it's turning long on where turns. in quickly rental the appropriately to saw moderation we Matt, we to there.So that We we've think mid-teens, double-digit And approach back of sort lot just constantly anyway. it talked even fleet We'll your will if level, equipment going moderation question, about And to I seen rental increases, think we're some a sell 'XX. can And we're

hopefully, that So helps.

Matt Summerville

your more No, your And some material markets. other then but are point? are seeing of talking of logistics, will, I canaries, et appreciate in some a can -- the if guys warehousing, cetera? comprehensive your et handling is one, maybe construction you then you spend big at end this cetera, a markets. automotive, of seeing end minute about of Obviously, any What sort answer. you And just you important facing if

Ryan Greenawalt

is that one. This Ryan. I'll one take Matt,

think our We saw just the have a strike, we conclusion Handling Material of Midwest, And reasonable the on of year. seeing as of batteries, and generally business. news. heavier area the converted manufacturing. side, to next that impact just from exposure, There's electromobility, the like the diverse that market and in products. benefiting it There autos, end pockets concentration. we're the new which plants our turmoil be we some pretty it's It has of disruption some of new a wasn't everything stable much will lines market but UAW labor move which dispute. plants that the old been lot didn't were along see coming In really terms On territory the -- moving an online new we're for it it's is looks country towards were we of affected, with plants is but that that for in happy good

the of we market. think follow into the about and just business year.On distribution story. similar the That speaking So next to manufacturing, warehousing demand going side, tends density stable a it's

it's on quarter, they through an is do more and up commented taking this cycle. for discretionary. to accounts. is sticky And With density exposure a and it's sales bit markets. York is And that population renewal little to our the the the that City, longer we only there the we We're a as warehouse think like tends get to last So warehousing Boston, less rates as a somewhat all we're softening Chicago, heavy Detroit, engineered of projects, the fleets, renewal, relates have pretty area seeing related it little a to areas interest solutions, automation. as formulaic the the thing bit come forklift process those New are have logistics seeing to

us discretionary another and warehousing that interest is the then effect there.And Handling in more we're an for the major type seeing Northeast, potentially Material rates for on side are they're having poised particular, the on end of medical With investments that ROI based market, there. those an in stable then where beverage, no markets the and chemical next also and slowdown very And growth food and year. market seeing appear

Operator

is line with Hansen question James. Raymond of the from Steve Next

Steven Hansen

sheet. on first Maybe balance a the one

And are achieved? in level think go? do that will like inventory you loosening supply be you up? you you optimized what have the where chains with to you curious that the journey further How feel much do Just described

Anthony Colucci

We we're in on actually zone, we the equipment, used. strike used a on in that, zone new feel like of kind right turns of And maybe little right and kind X KPI. that Steve. bit strike the quicker we're We target try of to feel than like

bounce able and chain our try to of turning to do Xx issues. around kind I Xx and get and as more. the expect always never that equipment whole year the a a to we're the actually lot today.I at upfront still maybe of lot as expect their We'll You maybe from [ we're little even we a to to and think inventory year increase want a to But may reduce of whole kind did we house, ] better. just new would pretty wouldn't or where level. a levels issues. us where I to back some through We production of moderate Xx see the lot settle bit on extent supply I they're so have think and of has the all backlog, But the with deliver, been Hyster-Yale of stabilized here. increase that on mentioned an we're told, that side to I

Steven Hansen

purchases. helpful. fairly some in That's the you referenced all, given if just a expectations like at been backdrop, have accretive to It attractive Okay. there's rate in like still high seller of expectation recent multiple shifting, cetera? environment, sounds done, that sort macro know shift feel has seller of how be curious deals any to I'd your one And shifting but been you there be of et side? major --

Anthony Colucci

last goes year. or not hasn't. this this there Steve, No, And that quarter -- last it's really just

have Alta. are territory single-line specific they're certain these that not think X trade is been that I platform end always will Alta These companies range a and -- range company dealerships that accretive that Maybe specific and the is. in. in years usually a the to with I've are there's concentrated in market a

answer feel But where be the we to a bit are is the multiples so lighter no, would would that value than little fair And at. certainly no.

still we at think $XX of we can on a to EBITDA X Xx. million that year execute think I

are And that instance better sometimes, we we find that than did. in can deals this

Steven Hansen

today. the just And feel sneak the value maybe around the just one, stock is if it of how one could That's great. I last and buyback in, you

you think referenced relative you do around that on the capital well? for But your your valuation. just and might feel in you earlier I the allocation the of growth as market it how cap opportunities have about opportunity plate still relative remarks some to

Ryan Greenawalt

and in points once obviously, all And businesses multiples Equipment. the a strategic These some X that the which of leverage we've of there, generation or Yes. always as levels, of M&A of case come on Steve, what generations liquidity and the the would we're buying I so X our elements pipeline the be or in buyback, -- up Burris referenced. just the are triangulated some the data these business M&A pipeline.

XX was family the Burris like years. for in think something same I

try potentially weigh attractive or elsewhere.But cycle and becomes it at And M&A And here capital relative also leverage preserving we're stock mindful maybe the the slips, of obviously, as to we're pipeline so in the of we liquidity. all using more kind where to those. of

at today, clear, we for is So a you capital I were be remarks want why -- to levels we with that reason, with mean, higher ways stock. kind which Ault -- ways -- wanted part A-U-L-T, what price. the at part the our my we're on negotiated willing are at we don't we floor we saw Ault, of on We struck deal to -- a to deal to a

yes, we so kind position And how that's of that answer.

Steven Hansen

color. good appreciate That's I it.

Operator

question the Northland from Securities. Ted Next is line with of Jackson

Edward Jackson

with how presence was opportunity Pennsylvania to is, there quarter. the circle do to on Alta. -- -- unique terms Can terms I like guess stride to come questions at? be thing location metrics the be my perform that of into my for performing would couple. it's least would experience they it that was Congratulations then does like -- it say, of you're first of And in you no new location to most what's in, of of CASE when does want kind that a a it? location a typical you in a you, question. asked, I'd then how of take first And for play? in investment one the for, than the how but got at at Yes, greenfielding all, actually no long kind like And a there just it hit because my it's -- the like you region question I of that take you long where would put sort were

Ryan Greenawalt

of This fill is some Tony I'll Ryan. I then on Ted. Thanks, that. part and think that, will in probably take color

a [ would of greenfield, and shy we ]t share not you we're going from territory opportunities with trying deem already there. a where manufacturer to into first out carve all, So who's for typically away

create market, very this all doing what and And competes can't difficult. is. You a bringing that's potentially demand in and in mature that not product new you're it's is

of field they manufacturer, today field that to technicians. of a strength they're going will is ways and parts that different we a has population are and there's ways for have in guess, deal population way success the existing being dealer to and that and that we field population with to had part it's supporting the mutual left been, and decided what unsupported.And this on or I service unserved they yield relationship and some in headcount of Here, a being an pivoting CASE and know have us is that a part historical the market, underwritten

can we up customer to to with we take quickly brand is customer them existing care and attach dependent on of on base. that that how and goodwill the equipment there So with that's can with be and the preserve their how going quickly base ramp CASE

oldest population. resurrected and was ramp-up we've near our And $XXX field very negligible territorial share.That's business it further the business and what market in point sort for to business, OEMs started being and Michigan, a we're sustainable legacy share of little Construction market the Equipment past million in any a territories part business X-year As of term having expansion. over this reference, the here a forecasting for without of about our with

have Tony, lines we anything brands other could by bring And with ramp With the that the in, we territory over years. could that And that's of... next or field strategy. other ancillary, to the to do that M&A up to expect you we that of be X stimulated on just sort would population opportunities that's but then further and there, be guess, allied the able I have be kind level

Anthony Colucci

material. it's Ryan, have think of agree before it's probably X Ted, I I years, any sort at least with you --

of I with. in technicians, parts step to were but we'll been starting we time. that into -- again, mentioned, really CASE a think rental ramp stepping and is into that the the any branches, But this some build nothing got people several right, some used this of got revenue, don't facilities But material in do with just capital, new and sort of here, start existing we'll be but These amount. Ted, sales I situation, to an as understands out terms up going it.In to years. forward costs, take it's We've outlay. and lease has this of instance, Ryan expect for fleet of anything to Eventually, here. given a we're we're leaders just cold looking immaterial facilities a will maybe starting it's here material But sort to start we we've good effectively some to the there. pretty have some kind soft partner

Edward Jackson

said. So understanding if you what I

up, the So going the CASE? from be get first, from taking stood over this of leases walking And you X then referenced? those that And locations you that away kind dealer to that's is you're just then first once region, be the you? build there's opportunity a longer-term hearing what and you sort if that growth have Is within for this from I'm region of whole you you that will because out, would?

Anthony Colucci

be there's into with X we other and of we stepped locations starting to... We're where had. the locations leases, kind Correct. to Correct. expect That

Edward Jackson

you least go kind talent, there a you that I Like of you bring so you technicians that have when of at if get need there Or level hard mean already get? the get. those is along something out to that's they're along? from will and to employee this? Will comes to of base be because dealers would, base some with

Anthony Colucci

There's technicians that was in it This other infancy Ted. CASE. publicly is today, was its very the working of had a dealer level clearly on talent just as much kind that of announced base

building And weeks. so team coming in we'll out be working the kind of on the

and kind after. today, anew, of go talent but starting to So there's we're out have there we

Edward Jackson

I the you because started. call if before actually. on it know release I a referenced And earnings out any but no, So mean, press I in I know there's press cool, didn't on release it don't newsfeed or see release it, honestly, sounds your pretty the

just Going side about to kind on talking next if the house, would. of electric the my question, Alta of you just

you -- Nikola announced your were sales some You truck last first quarter. of

an update maybe kind to stands. of with that regards Just where

less longer by know then I felt side be for of one the you on maybe the developing that room of more that like more hydrogen -- me. there discussion was where would the maybe I on for the a this think sales that where fiscal And how is the becomes term year. battery business the unit interesting And also. of longer-term and side it -- that's just end and

Ryan Greenawalt

Yes. This is Ryan. that. I'll take

about OEMs next the the We've And have auto our in be of forward. report for and it, fuel it's forklifts in be California, I call, gas part we're product. and supported. demonstrated, that. last week. cells.And earnings an heavily just be actually that general, recall their there's navigating terms officially to as we're a they through fleet for auto It's Nikola that being we're about think has right it for we're in one industry, whole in work opportunity. those teed -- hands in supporting that that we still haul of units suited application region, QX back than issue. was been now. not with And to that of had cell-powered is of did of But part call have especially the going is now expected supply We the readily the of our our to more X manufacturing Ted, fuel installation launched announced initial It's and unfortunately recall heavier for duty poised very excited in being think, an will going for that what we're in kind trucking, and in how longer poised this me, more Class solution the gas there's of gas. We and years of just Nikola customer up then excited deliver year more where services terms So in product. major you battery lot that right

product, still excited that and really road direction headed be stages, the Nikola It's on these we're more come. to with about but trucks the is we'll So back get early eager on to next the quarter.

Operator

line with Research the from of Steve Ramsey Group. is question Thompson Next

Steven Ramsey

financial you Can to looks profile solid like. with talk how is XX-ish existing acquisition, state? it margin, EBITDA Burris in to Maybe if percent, margin your the there Burris the to And compares for start that years performance of of couple investment the much further? And will of a gap? that the require Burris maybe accounts business much lastly, difference, raise what then even in to next

Anthony Colucci

streams so like state, in Sure, Burris so dealership EBITDA $X.X $XX million versus, is are be and Burris profile. for mimics of I'll the in rental intensive, is picked Steve. we is EBIT refer CapEx about Thanks the economic rentals. to the lot a clear, that in in talk a Burris rental rental believe Ault compact more mentioned, I heavily a kind and doing And why weighted say, means obviously let's to of million the -- our up is as Illinois, it's million to revenue fleet Burris revenue a question. of -- To we of which $XX often. Ault present and here, which second acquisition. Ryan they're

skid ag smaller So smaller et cetera. turf steers, specialists, equipment, and construction

what rest model to few Alta's the -- to X revenue this and a and on you're to XX the year. running beyond for of weeks of well a very construction Ault, sort that mix where model. rental run Canada, is we rental and may up things capital would and a because large make that's which the typically get But Burris' years sure crushing running frankly, for very equipment, U.S. long-term not or not assets are maybe one months want So buyers they rental on purchase to I has site They asset. options, in and anything, commit do couple or a where holding them RPOs, specifically.With here classify call, screening akin and model would short business in intensity is side is run, of this business the the can

the in to take, of So the sales, of EBITDA, million line. -- million, and think $X $X flows, flows $XX give that or cash falls bottom cash I almost Ault the million

then capital me rest really a the our in of reminds million the million high you is, million service $X we million love, equipment $X of probably is lot revenue, sales. intensive, capital $XX comes a or not Ecoverse and margin, believe know, at perspective.I parts from So as which $XX a intensity of is just

really business good us with it's a hardly should any dealership profile forward. rental cash-generative aspects business So for be and going a

Steven Ramsey

to That's looking sustainable talk can combined again, material is helpful. service that reasons margins, nicely, up improvement? handling be gross And parts Can Excellent. for for then the the that and be you consecutive quarter. that forward? And and something going second at

Anthony Colucci

or definitely first. the end the It be of could -- sustainable to back that question of half back the take

I think some where nonbillable time. we've taken inefficiencies over a in few regions noticed we've just

And procedures. you'll from there, is we've that what market? And running think a you some continue. at are that you're our of there Or of and Steve, see rate efficiencies. kind then implemented do is us so perspective, think at looking seeing yes, just you're processes of course, of room always there? the I And playbook our I And kind KPI driving

Steven Ramsey

me. Excellent. And for one last then Okay. one

rates higher, about to. I now to the think alluded this continues are Thinking juxtaposition. as to grow rent decision in and prior Are then rental judging fleet similar a still customers years? way buy versus fleet but that availability The well. has improving is been

Anthony Colucci

customer, And and years, we equipment? want with the years, did -- How us in bespoke what had are so was we was there meaning market? asset. to an asset more in and to made and relative some think to fleet to decision not get a maybe say, rates for we time, the have did has whoever OEM a were look, the predicated backlog that as one I they hold ways prior -- get asset well a to that we're want on another convert do they this -- finish I or to that for wasn't think between, whether of part need own or or predicated customer's find sure that existing this frankly, pushing previous the saying, they rental where to natural just into need there And getting loosened one can't their that rate we the holding out capital history, because returns some up, invested on maybe we an back piece going something just more another things to because job a on have. they're their or deadline whether become decision was.And let's from supplement we're decision so pre-COVID, in is commit

customer renting natural instances. as a the be of lightly we we'd service fleet or a on And of So in reap customer's us versus much as have it's rewards preference for to equipment used both, sort is will think I rather prepared the requires more balance well. parts say, sheet But rent-to-sell be and terms always sheet balance in and decision. I of become out most bank's rent buy our

Steve, with driving field we'll prepared be of ultimate So both, population. goal the for

Steven Ramsey

That's helpful color.

Operator

no this There additional are at currently waiting time. questions

So any to closing team call the for I'll management the back pass remarks.

Anthony Colucci

I you, upcoming mentioned, Thank everybody. season for our holiday And attending as earnings Thank happy everybody, you. to QX call.

Operator

the you conference concludes call. for Thank your That participation.

You may disconnect lines. your now

Alta Equipment (ALTG) 8 Nov 232023 Q3 Earnings call transcript