ALTG - Earnings call transcript Q2 2024 | Alta Equipment Group Inc.

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Operator

Good afternoon, and thank you for attending the Alta Equipment Group Second Quarter 2024 Earnings Conference Call. My name is Joel, and I will be your moderator for today's call. I will now turn the call over to Jason Dammeyer, Director of SEC Reporting and Technical Accounting, with Alta Equipment Group. Jason, you may proceed.

Jason Dammeyer

Thank you, Joel. Good afternoon, everyone, and thank you for joining us today. assist Alta's and XXXX website, is the designed detailing issued results along release the presentation afternoon understanding this posted to press second financial quarter was with company's A results. in you on our

Ryan with and and our Financial are Colucci, our Officer. Chairman On the today Greenawalt, call Chief me CEO; Tony

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

before we proceed will open call prepared begin We questions. Please X. with for to remarks Slide some your the

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

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

that these could Although with after statement differ revise SEC, call. other that to changes issued filed the forward-looking in we these was occur are release materially cause today. that including statements and actual of these no results any reports obligation from reflect Descriptions risks expectations we undertake our discussed our believe to this reasonable, to press are

found website Ryan. financial investors.altaequipment.com. I A non-GAAP is press the measures this turn can release today's call, present to to on GAAP over at During reconciliation included of and our may now GAAP be measures. we will call both in non-GAAP and

Ryan Greenawalt

outlook our a markets. today. quarter begin present quarter in assessment user environment of Good our operating of for business provide and joining financial Jason. in quarter for a business overview second conditions Tony performance the the then quarter XXXX. Overall, I for thank this moderating then detailed rebounded Colucci you first quick and you, analysis and of our end of seasonally-challenged afternoon, and more our of sales. our Thank well market the current will equipment face a results, the with everyone, balance us will the new for from

For increased to $XXX.X QX million $XX.X revenues the quarter, million total in sequentially QX. $XXX.X million in from

adjusted revenues For the record business our a QX. second achieve of Notably, increase increased million well $XX.X as a which $XXX.X to continued support million on performed quarter, environment $XX.X increasing business the is ago. to of $XX.X achieved year up organic million, EBITDA this growth population million, with product an moderating we field from in versus of

product Handling and on a our on steady regions also growth market solid as path share our categories progressively footprint. gain in Additionally, throughout its continued strategic we sales Material execute and profitable backlog of segment

saw a our $XX.X We first Distribution $XX.X rebound the was also segment revenue quarter. million versus Master million as in quarter in the in

segment remained and interest While and Equipment contractors. due from we uncertainty outcome, our lines, volumes and under strong a segment especially from return the pressure support Material midsize Handling market a to in our regarding unit business normal seasonality election our affecting rates to quarter small product benefited Construction to

year-over-year especially entire market across equipment ago resulting segment new supply unit greater Construction with most Revenues like business even compressed equipment geographic $XXX.X on is our our Let offset the in the dealer million There price supply me increased $XXX.X were the years. nearly for in volume competitive lower detail equipment degradation, in of the of machinery machines from and the market gross earthmoving but OEMs experiencing markets previous region the X% relative given market, a steeper Great declines. basis year footprint, declines sales our both heavier operating inventory significant the Florida. Across an increased a from now oversupply margins. and Lakes to is by discuss excess channel volume Equipment in in with million is in segments. The to by down

the We a categories as are declines. and of certain about Florida State more more volume from end acute steady the higher to higher in from significant position to large-scale of and diversity returning demand markets of years seeing to product propping the greater after growth, markets environment contractors offering. The see to projects have and continue normalized the most our those pressure the relatively economic we benefit like some geographic of for pricing up where Alta's York equipment that larger positive are allowed mix steepest our their Despite benefit New buoyant, insulated capacity we also will volatility industry stay remain marketplace. keep

was segment product differentiation We QX with portfolio focused to build year from the service our product continuing American sharply field extreme and benefit bookings. increased through increase $XXX.X driven coming streams continued $XXX.X brought on our our repair primarily and our industry bookings, of have lead expanding are significant million pandemic. Despite XXXX down the are the and peak from annuitized revenue from North on market market the positioning observing perspective time fleet in forklift Handling population. Revenue for the and from continue ago the in in decline levels. we the bookings normalization despite market of truck North an What The industry share a we in by optimizing the to declines the million a been American to is saw from the reduction market capturing factory revenue. continuously Material lift of by dislocation

to we share remain continue advantage making we gains, product competition. focus extending strong in to XXXX, classes XXXX, and to shipments on through relative electrified market maintain expect time into lead We the especially a the where

resources As embedded dealership business and segments we expertise in markets new model. actively well in part of with complementary are tangential equipment growth the strategy, our our exploring align that or

dealer support truck eMobility end, fleet, over-the-road Harbinger to an this of launch that medium-duty an an provide assignment is Florida to previously authorized electric report markets, truck this of dense The entered dense overlaps and their branch discussed intend While as our represent agreement gaining significantly into we the Southern Great existing has of urban opportunity medium-duty the pleased initiative back territory and our the California enter we footprint as have Alta including in includes I'm population leverage we this electrified Lakes, significant infrastructure. to new lineup. Northeast momentum year. To to and half that in support regions, where with existing

segment. opportunity bears on evolution easing Class market charging our strong rollout electrified will years. the be medium-duty commercial to electric are trucks, the X contained the XX resemblance initial infrastructure. focus lift Our the medium-duty vehicle geographically market of fleets Life of over through forklift X The last

with to we As transportation and carbon Services enable will agreement signed to the States an partner Class Mail services necessary our fleet footprint a their ecosystem. In U.S. electrified carrier vehicle the web-based into Harbinger Management source continues their new fleet. to of and and with maintain the technology Services trucks transportation providing a powertrain installing top electric Updating its fleets. Alta infrastructure Service update Mail the charging develops, box assist XX achieving transaction, proven the define, with Postal X as technology fleet of all management Management for advance to with integration service Service XX the providing well May, Postal anticipate the Services, specifying and we adoption system. Mail United to aspects widespread dedicated platform goals. Alta execute because directly is approach handling as Management electric assess,

and shareholders State for we XXXX. In I sales to Harbinger of inclusion in support our headwinds, traction market we despite confidence eMobility remains priority the projects remain close, of to second what inclusion Project long-term temporary outlook DOT strategy. rationalizing we business, we infrastructure in gained spending, opportunities quarter, next growth has other represent want to geographic the portfolio persist the have your half selling model dealership conditions. To believe initiatives variety backlog includes optimization and dedicated the be will While on elevated. believe Harbinger SG&A $XX footprint. summary, in support of to share our many nonresidential continued with the want are an and our all spending for multiyear demand of spending the streamline success product approximately expect our cycle as new high market is business. industry-leading in are we their pipelines the I and customers, distinct fall construction. Overall, believe we million customers remains significant the in and fleet the expand as advantages to with focused accelerate. our grow of and few to these dealership will the revenue thank our our federal to our to Cost a commitment business. Further, of also -- OEMs to extended to our endeavors now continues through convert of also a years assessing majority into positive capabilities business. rental that thank our the backlog sincerely and employees of and our our for size company's and

of Now I'll a turn performance. Tony over our to and financial detailed analysis it for operating

Anthony Colucci

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

as their hard busy Before the transition we work business winter the Alta I our commitment the of for operating summer begin, difficult I my want months. conditions during to to season quarter thank the colleagues and from

keep with remarks key guiding products you. My and ultimately which our motion. our their You will service focus best-in-class with capabilities, businesses in on providing lead X Thank customers areas. today principles daily,

as I'll transition results ramped, in be to as moderating seasonally quarter and our environment. a the presenting macro performance impacted from continues First, QX our second expected,

recap that our investors update briefly sheet current I'll in occurred Second, balance on position. refinancing QX the and

present exposure. in range lastly, to customer updated that investor slides the our X adjusted guidance end on EBITDA added XXXX, our which the market noted discuss like press was I'd I'll deck for Third, to we've today. new release And

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

customer $X.X as the the figure which and last million rental with growth the X and combined parts, basis our equipment For again, in and to from million we for an versus flat QX. Embedded sales amount revenue margins and the the and rental on equipment XXX up last income the and of we new To service were we to down sequentially revenues that year-over-year. We equipment versus is out Despite service year's parts $XX.X QX continue and increasing in seasonal and versus hit parts $XX.X as quarter. departments quarter. sales to points those contractor while and margins lines million. On level million impacted second again to $X.X support and a an in our -- the product down and service of to margins we as up from our midsize new on by a organic items Despite the basis, as -- up rental service organic quarter. up $XXX.X sales organic combined Material segments on briefly. equipment quarter, support, competitive X.X% challenges for as the the to Handling which beating performance the versus increased sales service natural used sales, product revenue segment relates have and for of continue new revenue million last million million have in specifically used revenue gross numbers small sales saw relative line, year-over-year in year, new million continued QX, once it $XXX.X our and pace growth continue as in on last segment basis close organic is increase to an Construction. Notably, gross at $X.X performance against to year-over-year. company lag in the the for business, lines prior parts, and realize parts our line impact quarter, year were margins held last on used up equipment rental the market, from quarter, down expected $XX.X strong Once tax the relative a quarter. Breaking equipment base push improved those noted saw million, demand delayed held last million record were QX before or up year and quarter and on moderating revenue $XXX.X $XX.X of of year quarter recorded we oversupplied

second $XX.X it better basis, versus revenue $XXX,XXX of despite environment quarter, which users as fleet, a million in we the we'll revenue impact the is relates year, rental physical sheet and returns cash-on-cash continues and on of rental disappointing business quarter, and the year's the been used XX XXXX. environmental construction trailing compared into between million adjusted Additionally, cost for channel from forma $XXX,XXX of QX our we quarter adjusted fleet difficult the in On last think, additional sales sales the the the in a optimizing small to product we rent quarter, utilization to fleet as midsize QX sales lines, in we to bounced are the basis, customers position have up the by see is when of the impacting we consolidated fleet equipment from on increase realized as the interest Distribution taking $X.X to dealer growth a and converted while equipment in XXXX. In throughput now be new to focused making to the a expected, QX. stability summary, gross is into million business are for in from the the as their end processing million, proceeds in spot EBITDA and in and original were categories. In impacted, and markets. All lag equipment segment temporarily the Master our to market of And $XXX.X sell heading coming told, level to the the $XXX.X outperformed EBIT gap in our a margin, wait-and-see balance last EBITDA the for quarters back while rate continues success stocked-up in year last pace to the way and support businesses. investments segment, as we as approach expecting widens in economic capital continue which pro rental the proud product second adjusted

our a market the supply the has some on approach of gut construction in in of lack buoy department quarter. to margins gross streams, gets in and while wait-and-see equipment pricing, customers the as purchase, volumes hours impacted this next the take note, certain aging to Additionally, discipline revenue and to, dynamic has new in and accrue Important a to diversity categories regions of opinion, on help this the led product equipment our our customer which equipment. that will the support to our continue to product

transitioning of oversupplied was indicative the on appropriately to we're $X.X OEMs. demand inventories should sheet inventory be stick it to that backdrop manage and versus in that turnover the balance for a to noted quarter our our the KPIs used focus able Lastly, line item new face reduced equipment as QX, by million of and

briefly first facilities on Now my of the mid-second second credit lien occurred of and second prepared to portion refinance our quarter. want comment the I remarks, for that

$XXX able facility lien First, -- were $XXX first facility's the XXXX. and extend the to amend we ABL million to maturity importantly, and from our extend to XXXX million, facility from

lien first Additionally, other $XX plan able the the years. by make size enhancements over the growth necessary of to business and few given financing credit to facility increase our million our in we floor our past are agreement

senior notes liquidity sold XX/XX/XX pay $XXX to used notes maturing second to balance mature that million in $XXX sheet. on to of off set the the in were enhance X% we proceeds which XXXX, and Second, in at million lien effectively secured were

million on for notes restricted the approximately no that similar new this pushed flexibility. current the sheet, generated and wall and million note for financial have business, $XXX on business. maturity Importantly, old of covenants the XX/XX/XX to $XXX positions the max investors an mid-XXXX balance second first operating liquidity allowing should Effectively, refinance our to from out the of lien

in credit X.Xx the to EBITDA and level approximately was a execute reduced underutilized ratio refinance relates on down of pare for guidance, updated half. we the XX, categories second reduced OID and is has lies fleet focus environment ahead. as perspective, business to forward EBITDA quarter, $XXX leverage XXXX and that as the inventory and it to million refinance, metrics of associated expect in June for we that From macro with as rent-to-sell given the the a of given any continue liquidity our providing the temporary June XX, and now As on liquidity flexibility the fees the in manageable plenty ABL revolver

of portion of Slides breakdown couple XX market point my of our present an to the which by like notes of to revenues the remarks, A the of and third investor segment. end prepared XX estimate deck, slides. For on I'd investors Alta's analytical

market that have of end have to and we spoken to the past, diversity. be with on always specifics able our investors First, provide more pleased now in diversification to I'm is and something been proud

you us the theme and product is customer of our end diversification in that monikers relate the names markets. see our an our As to take vast Handling will products the of those in to on which enviable verticals, position Material offerings sold Construction, segments, the overall slides, and type base the despite of

and logistics, education, to retail XX note that manufacturing, example, XX% comes supplies which an and code distribution category, and wholesale automotive to of food the to few. SIC a the multiple to Slide that, and revenue. categories manufacturing end beyond on the paper one, estimated in As from segment's beverage, Two, segment name range is the Material for chemical and for distribution, and beverage and XX the food market municipalities defensive Material segment, Handling from accounts will largest Handling investors an next XX% distinct this of each subcategories have our medical to revenue

a One, a our evident the given Midwest Two, cross-section a segment infrastructure that base the our scrap that combined such the to from four, end in and And mining roots as the things segment from utilities. end Slide help arena. latest represents stability aggregate the agriculture exposure notes is effectively from perspective of that and we what On all market tied and XX, in coming of Construction Construction -- on products manufacturing, coming are and healthy municipalities sharing provide forestry of of our couple a and ideas gaining customer and a should demolition. advantage and with XX% and play Canada. In across is a to of mitigation related for wide diversification believe business roadbuilders combined agricultural for note XX% are Ault solutions both and in the our constantly our industrial here. spectrum of years spending Three, markets. commercial come to our categories acquisition ultimately, for bulk risk summary, of contracts is teams cross-selling are revenue offerings and in reflected an and our us, insights, as and that

I portion remarks, last to my updated present the XXXX. for of want Now EBITDA on guidance prepared our insights our for

observations. year the to report expect now In adjusted we the for few full to of million $XXX terms XXXX. million EBITDA of A number, $XXX

headwinds. First,

expectations which XXXX. modest we a equipment As of many entered North new runs industry construction noted, sales year to America flat is of when to down customers XXXX, first of growth equipment meaningfully to in half the in participants in counter have deliveries

our election rates surrounding seen we've higher as gotten have has the gone contractor impact interest with this most acutely the 'XX. and -- mentioned, has midsize and the our the references dip to models and Ecoverse, in in to small pronounced the As the at segment and uncertainties second expected, more market more be continue we will risk-adjusted in year used and than internal on. The equipment the as the customers and pressure of Construction suspect new evident impacted line half

led in to new oversupply compressed margins gross Additionally, in the equipment. markets construction equipment has of the

accept valuable pricing certain we've that share have in and our we we that in than Again, suspect in we've previously, industry the internal over to hold deals. had mentioned follows equipment to categories long this It historic persists. on outpaced compete term as skinnier compression undisciplined As margins overhang what regions. the and years, competitive so continue earned has models, supply observed and the to risk-adjusted product the margin to pressure the we be

have we with the to line seasonal led than the Lastly, are for line utilization our to QX, the in business quickly and seasonal and carrying. expect size That the as notable, markets. less expected of and fleet we Construction the demand we despite with fleet targets out rental ramp quarters utilization given X model, rent-to-sell in fleet above as anticipated rightsize wasn't get of in factors the coming while the ramp in -- specifically in our said, and our in the to segment, steep back fleet our rental

as the Now to some tailwinds second half. we head

backlog had -- a of geographies half First, product of market to our sell and key sell solid Material good share XXXX, Handling half has have a continue a first to classes. segment and in to expect take second as strong we and we and out continue

expect we business PeakLogix to rates come as ramp in. interest Additionally, the

In activity this Peak fact, recent thesis. supports at

credentialing with charging mentioned, commercial to OEMs half in eMobility Second, as the relationship work developing segment EV space the fruit. associated second with starts in we're as and and bear the of 'XX notable ourselves Ryan revenue from the over-the-road expecting

faced manage and the Alta and term. In cost to out and the be of dynamics half of revenue second challenges long are of long-term the of the could some prospects the to current measures market the we closing, some today we overhead first for taken the over automate we help given costs that actively remain believe and the focused streams to in Q&A. be lines of business and time to and which operator the winning for the as and emerging of gains the challenge share for 'XX, attention, new and our Ryan teammates strong look forward meantime, front and and transitory. year about macro look business say I revenue potentially on would us XXXX. Thanks which and back down second lines 'XX, in business, one help market the forward a margin will it will drive our In position in Lastly, we've to in to weaker offset success your to environment, ways and the I customers the the looking in gross half turn on new our and fleet we over cost that I'll at creating a optimization of like bullish further for to half business eMobility X,XXX prove proactive

Operator

[Operator of question the is Instructions] with D.A. first The from line Matt Davidson. Summerville

Canyon Hayes

if get to Canyon Matt on in down for we get detail could more the got new wondering some reduction You've of could maybe a was Summerville little a on were today. little bridge more Hayes the maybe commentary? guidance, drivers that order detail in EBITDA the bit was wondering a midpoint, I -- if the rank we maybe bit I included the

Anthony Colucci

large Deere, and vast should majority Yes. in like is I down the equipment And to sales we against to driver. primary commentary. the overall base. margins The almost John et equipment Caterpillar, OEMs primarily that small segment that related This the that reduction reduction on reduction, midsize correlate mean primarily. to going And new in in the is just the a spot market the then could the other of cetera. in the demand you participate contractor Komatsu, to say, directly used commentary I Construction

pullback if be we April, half a the utilization and performance. little nice expecting there. rental more quarter, to -- ] in would kind be [ the fleet you B and had a it think second of will. I then In would we quarter, also, of A back the bit our And Ecoverse's just do to saw that, Beyond a

I of the come rank So that to down. caused items would those kind guidance that's -- the how

Operator

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

Steven Hansen

pressure? to the certain on midsize seeing but back across the it sort you is more of are where states? there Is it guide. it It or into territory? the is -- customer, Just question contractors categories? Is like small it is And wanted on Is product your same it focused most shovels? sounds entire the Or broad-based? dig certain to

Anthony Colucci

I'll that Steve, take one.

in a -- Ryan have versus, Florida. broad from demand the mentioned think states I Midwest perspective impacted remarks, we're just his let's been say,

know, you massive equipment is Florida market. As a

So impact just has demand side. being would from been the impacted most for here I down probably primarily the Florida us. biggest say and that Michigan the

In that stuff. from would it the terms the impacted, heavy -- would say perspective pricing a a and perspective, categories of big what margin be I

So dump articulated Florida, articulated erode -- some discipline those XX-ton trucks categories. dump trucks of this seeing where down product in larger pricing we're on

have a of more much what is We slight that's lines, that maybe would -- categories. compact year-over-year but in on hopefully, the and than heavy I more seen If the pullback say helps. muted going in that

Steven Hansen

does And if the sort you as you stands it you look incentive helpful. today? point very the lean from financing that's do how of the down, inventory OEs need all? a how at No, Yes. much for presume, the related then respond guys do seeing it? And is, of just -- are and program, I stack to How is part that

Anthony Colucci

that's And pricing-wise impactful. talk Steve. maybe their about how Yes. I'll take that Ryan one, and the participation and OEs allow to

of terms turns. our we're In very close fleet size, to the

used strong were As cetera. inventory, and stick in quarter, reduce I new new mentioned, we the really used X and kind inventory, I that's equipment, on we try on for to a turns to think here able the of as team our really to statement et

new So we've opportunity. down used. rental I the The where we're say would got most and fleet is on actually

turning more fleet, to out was of little you in we'd $XX like able bit maybe about probably that back $XX if a next million on like aged kind $XXX there's we We've probably here that the to used million And think pare in than that's I year-to-date million think where I the department. several million fleet to a quarters, something the say. let's number $XX think reduce. got fleet. And some were the rental of

balance So is where of and right on with we into from matching several just to taking fleet And supply quarters. the in the the want mindful and next OEs. be sheet snap key the the demand, we'll back ordering being what we're and

But about stays levels So is. that at long talk it do to demand as or you to the least Ryan, want buoyed pricing?

Ryan Greenawalt

Sure.

So pricing important times has the the dealer as been in the OEMs it never more like relates relationship between and to this.

So dealer is we've and got an overstocked competitive. deal every channel

active made So with of comments plays the into kind about get and of opportunistic as share manufacturers near an the some and We we the various we in lack product dialogue on might Tony that we're it's OEMs see undisciplined some discipline into marketplace. market. of their see the the the in erratic represent, seeing some swings of where happening pricing try do some to to crazy term things one

Operator

Steven is of The the Research Group. Thompson question next Ramsey with from line

Steven Ramsey

I about segment, yet well Maybe in about wanted a things Equipment of above there. the Construction looks like construction revenue XX%, co-result. demand grew. couple to think the support It moderating, total aftermarket

change Construction what's secondly, then First, weak do the lower organic what how bit, backdrop? But kind base -- was installed half, exceptionally if of with second the you much there. business with And the some that utilization the market parts ages to be and expect offset in stays the parts services? the of of Equipment out a and service maybe strong

Anthony Colucci

the and line. this our some the million of saw some segment the organically face or just and business of Construction give the XX% -- down Steve, new Construction that. used of numbers, our to support product in in think was in equipment you we -- business I I The $XX.X MD&A is XX-Q. mean

an were out able fleet. $X sold an offset by rental the to some of that incremental million we Now or additional having of

down in let's sales. an which we what year-over-year I just what similar saw The equipment in would but So it we supply terms think will single to something ages, million the digits we in on a high be organic of when -- call benefited $XX fleet support from chain from issues, the big product there that, replenishment as to see XXXX. was Prior perspective. ultimately benefited a basis,

the calls, that that new Now their that prime down got broke a for by a out slide support field haven't customer all way, big is They're equipment in in that that low and we've not that pretty lot a stages there -- year, equipment. of they presentation to product that utilization, and parts by But service our some being equipment our good days. single operations us, out way digits the the data right, kind maybe there's replenishment our happened it's a in we'll last in industry suggests you're of of much in there of terms overall, virtue service yet. customer flat even equipment equipment utilization keep utilization early suggests there's down That's busy. population, which, the of of

missed have question. So of I may piece your a

circle So but happy go back Steve, there, ahead. to

Steven Ramsey

commentary. that No, helpful was

revenue good parts that the With So maybe service for to Construction Equipment department service how in utilization favorable for does pricing-wise? parts topic. segment, and and environment pricing that line? this an work the add-on question the a Is

Anthony Colucci

what it of labor to that is the terms I the than there right say in labor. country and situation gets the is would more lack back structural Steve, is, skilled always of that in just anything

related relative to just able to we've been to to pricing activity of you to the our along or see push that year-over-year, our increases ability gains So along customers. push pricing some

So the tie of with of more the it out utilization correlated that's of in I service. directly dearth price wouldn't kind the of That's there. skilled terms to necessarily labor

Steven Ramsey

And anticipation little Or of helpful. less purchase are to tell fleet in is That's it to some understand letting new bit are that better the environment? obviously, fleet? of willingness, Are And better, the to Okay. and you rental used maybe if sentiment equipment. fleet they they age purchase kind can lightly a -- of construction selling tying customer your what customer willingness segment, then maybe rental demand? used this they to in

Anthony Colucci

think front I me, I right, have it probably fleet, of think of out up up which QX. and last year I in -- million our strong. don't versus We versus is but sold still $XX.X it's

still they're that's just We're And perspective. model lightly so from a margins the still part on buying our of used fleet. the field business population And fleet. lightly used good getting

more we wise, lower buying -- ramifications back keep the out the I have same we've the -- to like going projects. of after gotten where tax I I about know just refrain. think pronounced Steve, has They to it's the rates. see getting equipment refrain saying, of I'm future the mentioned, I'm appear older look, until gone equipment. through keep be maybe going election grind customers would And to I -- second and say what sentiment backlog. as busy until is specifically They're that capital half interest as here on tax are I quarter, my my customers when piece it of more

nonres I nonres, think will, So customer sentiment it's the space. in smaller those if factors X end you driving primary are of the that

Operator

Riley. of the is Rygiel question next B. Alex The with from line

Alexander Rygiel

stronger you, talking time of spent amount good probably XX here medium-size about could ones. are A the right the great Maybe here. those the markets But end Thank now. soft questions to talk company And you can seeing. of these think that in contractors some total on of aggregate, Tony, through you and couple of couple you're quick We a your for markets talk kind small I and thank and that smaller revenue. of some about percentage run a of the maybe But we of gentlemen. stronger a end little bit slides a XX. that's

Anthony Colucci

Yes. Sure.

think, I and to maybe beverage, -- Food consistently to strong. consistent, the is just I just segment. by circle would say, distribution Alex,

really seems just of amount I a Warehousing long Handling that fine, be the sort recall the as moving just that in customers facility stalwart, fair is not Again, where or just is tepid, down. spend coming maybe the shutting as there's embed Material are us, off medical logistics side. again, of that of and heard of little maybe many a say seen but But so supplies. will. our facilities also as to open, of we would line. a still you pullback haven't we any bit into if And automotive, for enough cars sort like facilities

seen Material we pulled Handling it's and has of the stable say pretty so And back. say haven't would in I all steady. note really anything I And side that would

and as deal, would think still point Construction compact market strong. On that Canada, that in in equipment aggregate of I the strong. I is I side, the mining some Ault Equipment -- up to think the landscaping the and

it's -- buy but without road names very The the the projects. hesitant all have commercial naming I we maybe and that customers some of maybe on strong. development very to busy for are all site think is weakness busy, big midsize

but that the doesn't So could the of mean the spend, pull all factors, That prognostications, election, trigger equipment. infrastructure the to going be are on interest that customers et they're a and pricing busy equipment, cetera. strong, variety other rate, of

still else they're in -- So Everybody midsize equipment as historically. They're just sort other buying same that development the done site contractor. not level is it's they've of really difficult busy. than

Alexander Rygiel

That's rightsizing that helpful. might how And capital? about rental then as fleet, you think redeploy your you

Anthony Colucci

sort correlated debt, that the in little first right? think do, right the our of our I rental a temporary, like it's, and priority that think Construction significant to in Alex, our in it we the directly And bit revolving fleet is business. here. debt load. what that's way would is We mind, of turning throw rental at We're out with a fleet

so would your And right the one that put want question, answer debt. way to but against to we

Operator

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

Edward Jackson

then with they things their were the with would reported more they down call the to a themselves to Handling. And actually goals is they -- truck the be of, slowing meet I'd yesterday as their discussion, actually some that of take than currently more subdued like regards market able and offer call envision. outlook for second into for to that that market year that more sort kind today. some talking would they they My got share half first Hyster-Yale to around made commentary And longer-term question to need Material about regards than of XXXX faster expected. had see them it, did

Material When can So I kind you kind your you That's what you. that as within part aggregate with talk you then maybe the of my like of and mean, business, taking -- Handling but look into a Material Handling of as to business important the pipeline scale Hyster-Yale, we of you're mean, that to probably question. that all in regards know applying relates to XXXX? it's to about seeing -- it regards it activity I first And a the I business? most the world think of about bit

Anthony Colucci

this just it. would I scale I Ryan Material comments But business. have can At significant one. the I a of the Yes. may And portion know is some Handling -- Hyster-Yale on ex a it's that check, about you on of. backwards $X.XX we're of it's that significant kind relationship the It's PeakLogix, if go a last and very think $X.XX, dollar, relationship. proud

I could it. the market talk do kind that's scaling just of want anyway, about taking so -- And Ryan, you share? to and -- it's

Ryan Greenawalt

Sure.

not little fleets static the fleets long-term replenishment that come that that normalization X of that that. kind used you're bit dimension fleets and is are And more is a us, them So in being just don't comments dealer. we volatility in. market that renew. a the seeing the of that's cycles bookings for a And back orders volatility I the guess to we're are on there than field you same coming on -- and depending the legacy more that's felt stable to first that ground, And are is -- they're you years out level. the the terms that of there population a But are -- coming the in out a a with we're reasonable accounts what are the X as terms manufacturer the big thing see up as the on are tried dealer, a big and seeing lot for flows the acutely renewal usage. seeing is as as of on We're on that industry they do from the ground to

had Hyster-Yale trucks. brand choppy the kind dimension couple would where model quarters forklift allied Material the industry, other the narrow line forklift remain on flagship of that's that revenue to the for electric of is our will I other side take just And on OEM the excited that. overall product the the through positioned Handling So organic think way, features lines. that we that stability well It's a that we're the we'll any growth in goes growth that think our one of we're and I that the have don't heart a positioned of or at we've mentioned and look of about. product then well dealership of of side, across it. It's that don't see headcount -- aisle guess, the focus. And regions. we And shift of We've we we do environment. of the that business this of And support on got in to we've revenue business share all kind some mechanics, continue the think we we --

Anthony Colucci

specifically We that, will, have sub-bullet applicable And thing a still because taken of a accounts some in aisle a these is Yes. of warehouse years, it's and -- helpful ] you correlated logistics year the when very and to just our trying X if opportunities. bookings product to growth of the directly we're have over -- this innovations maybe last step in sort biggest still the specifically where products, put those in put represent are X would narrow a couple share Conquest Toronto. that markets take Chicago out in [ organic of to good and Hyster-Yale -- this market. to we that go I down further, and maybe has there the

we're about backlogs. how so share that business. all has probably, of we ship year bookings greater a given actually the will moved share for excited have those And our -- And kind of next

of Ryan given and to as we're so muted bookings it's in can bookings that And a field of little of end some be the said, the forth population number because said, snaps production. us, back the because of more and volatility, of the all end, as the COVID, especially for Ryan the in And on after bit me, kind number, the big. back

Edward Jackson

earlier started faded regards with in My it made with comment that April and guidance saying strong you'd second of quarter regards to the question question into and the Okay. Ecoverse, kind ties a to out. then an next

lead $XX look back the there, in fact think I that the you do half business across year, the given exited whole in you saw grow to that annualized you quarter that 'XX?Or you and second the an the half? quarter, of million that. in question you When you think You segment. to revenue might And you half after mean, did the year-over-year went one of that that nonetheless, business carried second the basis second I second the see softness about as on able the forward actually decline a business as pop through you'll show have nice be and at -- believe has faded you the

Anthony Colucci

both is to yellow I given kind dealers, think Keep iron I they performance in difficult on very Alta QX, for be lines which the sort think they're of 'XX. relative selling did what it competitive will repeat in Ecoverse and Ted, the stocked aggregate house, Ecoverse the handle then to mind, and in of of and up. -- are mining earthmoving some side of to

be really I not could And and so that say, They're end these terms capital and past on December material, the there equipment assets. strong in election November a went though, -- -- of XXXX, markets selling busy to in people saw us. as mulching are somebody busy. we the cultivating committing that's organic this of sort just material processors, would

but for some see happen. expecting so And unlock that I something absolutely to could things we're maybe that Ecoverse, not

Edward Jackson

as million-plus and when free the outlook flow of of should your is fact rental part we would then about a Tony, and a half you down of the free And talking go what $XXX that? for think disconnect kind that's with year year? cash is, the about capital. thinking would the the from those side But thinking missing 'XX? And finance at of items of the $XX of assume on side line fair my down for statement balance I a Okay. I am sheet, here And given beginning an it cash half back that see a the you're the would me. the market year million. you're inventory there's as my it between the from generation assume we And look And how flow sheet? view, is and statement, use the that question. cash a But little like Is down million, lack the the accounting you balance that's to question about last a this cash better flow then demand it's as cash. note flow first inventories And lower see on I about question through and working kind basis. is really question solid how think $XX But go then of Usually, on X some that accounting more in challenging well. That's of that the end we first term, the we -- actually, well. there's with -- bringing fleet

Anthony Colucci

I'll take those Ted. reverse, in

of the the the to cash GAAP they at got line. for the transfers accounting inventory tie kind way that just you've works. statement, noncash back If of kind to bottom the flow account of It's

inventories we So the reduction go but as balance statement. in fleet a account on down, you're will, transfers that right, for the into the you are cash if sheet inventory rental net, flow the the versus

first the working Your look -- first at in million If the of year half we last Slide investment terms million, something $XX ended like and XX was yes, year, difficult is $XX the I investment. more the million working year, capital, the of like we working something first presentation. first in our our capital, in net of year half investor capital of for always $XX the question on half capital working

through the perspective the the half year. And meaning at the some Ted that, year here We're half generate same from $XX we ended ended working that's -- invested So be last had we first capital over kind a yes, able his of question. we of 'XX, $XX of the to the on pace, year million gains should million investment. mentioned back of and

over close this close So -- call. to the to turn operator it the

Operator

That Thank concludes your call. participation. you. you for Thank today's conference

disconnect now may your lines. You

Alta Equipment (ALTG) 7 Aug 242024 Q2 Earnings call transcript