SHYF - Earnings call transcript Q4 2020

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Operator

Good morning, and welcome to the Shyft Group Fourth Quarter and Full Year 2020 Earnings Conference Call. [Operator Instructions]. Please note, this event is being recorded. I would now like to turn the conference over to Juris Pagrabs, Group Treasurer and Head of Investor Relations. Please go ahead.

Juris Pagrabs

good Quarter and Earnings and and Shyft to Call. Andrew, Fourth Group's Full you, morning, welcome everyone, the Thank Year XXXX

President Officer. Joining Daryl and call the Douyard, and our Jon Financial me Officer; Chief Chief today our Executive on Adams, are

we've the presentation deck, call, shyftgroup.com. with be which on available a is and SEC also included our today's will filed For the website at

call. deck the our download the from the website presentation follow may Relations' of the You section with to along during Investor

Before please safe of statement. we call, the presentation X start to Slide today's turn for harbor our

are should made management's management call, projection, filed to Reform Act actual of prediction You the be and Group today's in that risks aware with I from viewpoint, there that be any XXXX. outlook, of XX-K materially the affect operations, statements that projections include the our under you Group's during considered differ a may its with Securities the Shyft forms cause that statements XX-Q as Shyft certain results are and and Private which Litigation results predictions could believes materially number caution identified could regarding known conference the All current may SEC. or factors forward-looking projections.

other cannot However, risks that there anticipate. may be we

On on for outlook XXXX. the business to a of call moving results today, and our we update a review before will provide the more detailed

as that the remind revenues on the We and Q&A. the well business open February to the past to to would on everyone presented. business, of will have results with the this discussed Daryl beginning reclassification been assets the pleased otherwise this turn as associated of and refer operations year, then the Slide unless this the call will the reclassified X. to With for comments operations At over as I'm for with liabilities his for response X line divestiture noted. periods ER time, today like discontinued expenses all continuing emergency ER business I

Daryl Adams

Thank quarter joining thank everyone, Good you our discuss fourth full you, and XXXX morning, results. for Juris. and year us to

has been and as unprecedented XXXX While many, categorized, by challenging.

the For transformational. Group, and historic was Shyft it

align our team business. innovation product in is we of and with resilience. markets. in delivered Velocity, sale immense van executed hard growth year. profitable purpose-built be in invested on EV growing I customers' the walk strategy Shyft their remarkable ER transitioning The effort the our We of proud launch cannot and As portfolio and toward band our interest delivery technology. our showed our Starting work of as we strategically more to a vehicle tremendous with more supporting

We continued offerings our the our leadership the our our organization highly well support XXXX with product several key team expanded qualified key in our M&A positions our completing Board. body market. We that truck as to Directors as in added growth service adding throughout strengthened acquisition and initiatives, to

be As we stakeholders are that to nimble, we continue positioned needs of the aggressive to evolve, proactively ever opportunities, and all in of prioritizing to are enter our reflects more win. we than XXXX our to way prepared a address and optimistic goal as

for demand at a orders during vehicle is help complements the and Please come. the meet stronger van that in years to for alternative new where X began environment. we XXXX we To our the delivery FX I'll million, the to turn Velocity our head Velocity innovative visibility with well their has e-commerce walk to our has and which design This for This to customers operators capacity. capacity good from and X, our up across rates, totaling emerged normal for FX XX%, an purpose-built with delivery their size, providing provides XXXX. orders customers And demand, solution Class discuss units required Ford growing meet this position continue vehicle from as the accelerated have customers growth driving Chassis. quarter, We customers delivery January, businesses a year. and Transit ended X,XXX quickly demand our parcel reflected announced backlog FX, or want are which ideal $XXX nearly MX Consumers vehicles, new delivery in us expand a establishing solutions into fleet taking in drive their parcel in increase to to as embrace fleet to for fourth in fleet we XXXX delivery Slide needs. equipped Velocity and several we this current increased delivery

our to delivering upgraded this in example our these of later located scheduled flexible adoption Charlotte, customers' design manufacturing engineer are from instance, as vehicle we begin this efficient this customers' a newly and versatile of for solution. methodology, facility great hit The In of our out listen a implement Michigan. is to delivery a month our fulfilled orders the work-driven park needs, design, on demand where We our vehicle. and more it we engineers

of strategy make to offerings We which our to infrastructure of rebalance in us growth to manufacturing and investments support our geographically higher support over continue run. flexible long product allows the to levels expand

City, locations, pool. Kansas introducing of a Michigan body are Florida includes We service truck addition our which manufacturing body and and at the Chassis new in capabilities

our publicized mandate year. a and the are To in with of segment. to expand we semiconductor the progress respect manufacturing, availability to made, area invest this mile we last heavily the coming take to adoption date, seeing To vehicle the about OEMs to chips seen are little operations. BEV green used which continue has recently. advance this continue in particular, what to EV vehicles that end, have our been in would the I impact Transit our delivery We have address moment of excited address proactively Ford capabilities on later in we to out very customers'

the keep apprised monitor changes. of impact assess early bit it of to these will to we too and full However, you may and shortages, a continue be

excited luxury resulting a to Truck well Body, Royal With underway. motor creation RV since additional Truck well, in full the summarize quickly Slide reductions. management which our coach the service team to Body continues opportunities continue Together acquisitions, running, resulted ground flow peak to business and has year with these to our We at X. and as production The partnered companies in perform and with cost DuraMag the moment that, me take the nicely industry, on body the our value resurgence make hit their that DuraMag, integration Royal acquired from improvements we the benefiting results did ramping of pandemic. let be last efforts provide. of up from about Our we October, the team output business are

the in within core markets, XXXX footprint solid our million, results million increased again, increasing order. results higher-margin significant pandemic. demonstrate market operations. impact offerings $XX.X improvements excluding of posted strategy, our For Revenues which to the success product expanding and the the encompasses transformation Once share, the or business productivity and XXXX. UPS $XXX We for geographic our ongoing our growth effectiveness despite of well adjusted or X% million Adjusted within EBIT EBITDA record reflecting for adjusted within $XX XX% the our $XX.X fourth our to -- discuss increased of the transformation Slide our provide and quarter Jon XX.X%, outlook, a Shyft's to detail the as our sorry, margin business year more to efforts. basis results beginning over for million power X. With clearly in points our as margin on that, I'll financial turn improved XXX call on XXXX to EBITDA

Jonathan Douyard

the turn to everyone. Please you, and of Daryl, quarter. fourth overview an provide Slide results morning, for good financial Thank and I'll X, our

As Daryl was a fantastic indicated, group. year for the XXXX Shyft

XXXX. fourth While year in quarter our $XXX.X operations continuing sizable to orders cash and from year-over-year ago that million, from expectations. the declined $X.XX increase of quarter increase, compared to share XXXX. year was in quarter for per us Income fourth the share a Revenue as down exceeded from from significant ago. saw flow was share per $X.X million we fourth an resulted continuing $X.XX in quarter. our $XX.X We year-over-year, backlog was Earnings million financials positioning operations our enter compared operations well performance generated per a the slightly

continuing Turning period from last as operations to of EBITDA sales, EBITDA continuing sales a the decreased of percentage to adjusted from million, compared same $XX.X year. million X.X% from to Slide X. in while declined QX operations $XX sales to adjusted of XX.X%

per For the from was decrease fourth continuing operations $X.XX share from million time $XX.X And $X.XX adjusted adjusted net year. quarter, ago. $X.X a continuing income last to per at this compared was $XX.X operations million year EPS from a share million,

results into jump operating by we'll segment. Next,

with begin and fleet X. services on Slide Let's vehicles

was FES a ultimately generated closely dynamic compared the posted FES and decline resulted The down versus cargo second to quarter significant primarily for revenue third order expected, was in million van activity. solid customers business following $XXX.X full with of to Our Body that upfit $XXX.X environment a in million the as year year, while total due volume. and working Revenue in lower results also ago. sequentially ago, improved headwinds year quarters. but pandemic a Truck

as by the that the it's which year our to discussed were QX basis, million acceleration well customer decreased sales, prior supported as XXXX. points revenues by EBITDA product investments increase in quarter volume addition, demand, in a and we to In margin to a XX.X% in note support important lower declined FES percentage million XXX basis $XX.X driven $XX.X fourth impacted the we of from adjusted EBITDA ago. mix to into required also of call. adjusted as On volumes expected vehicles

of was increase partially contract lower Specialty was year. Similar The addition favorable strong entering driven acquisition, primarily or noted to offset DuraMag coach XX revenue by of by continued in from motor of growth as volume out backlog for million, double-digit good lower as with an motorhome, resulting as the in well XX% $XX.X luxury well and prior strong QX our the us the to a manufacturing business, Organically, of saw DuraMag we million year closed order well, Adjusted was Our and second chassis overview. Please consecutive a which $XX.X throughout $XX.X in Specialty of the the the increase quarter quarter. -- XXXX. Royal last XX% year. to Sales COVID. commercial incredibly Vehicles business million, FES the first the revenue year. was had of of backlog demand our the that XX.X% grew record a XX.X% of $X.X the Vehicle impact million positions activity as to million quarter, turn Truck the sales or in in compared position Slide EBITDA XX% completion we to the period in acquisition. due $X.X or same of sales up X% finish $XXX million earnings we or on volume that Body the segment pickup call

fantastic XX. million a mix of the unfavorable cash backlog coach million, backlog investing revolving volume, generated to ending which flow year as of our Update efficiencies with of paid did year, the hand the COVID. by offset on as well on chassis operating liquidity. We $XX due million the from job was team turn Throughout and growth total in to motorhome managing up to from down $XX on in $XXX million impact activities, cash We higher Slide $XX backlog the productivity and facility. future. and credit and cost cash our included lower As million service SV acquisitions. in $XX strong body Please our outlook. liquidity integration-related was expenses motor the XX%

to EBITDA, adjusted in fund Our to current X.Xx strategy. leverage at which our well operations growth continue positions invest and ratio our us to stands

returned shares. in XXX,XXX of the million our form XXXX dividend our shareholders in cash the and in to $XX regular We repurchase also of

taking per shares XXX,XXX purchased our have total an at four purchases last average share. We in months over to additional of $XX an QX, XXX,XXX subsequently price the shares

extremely We challenges our we given this year. the performance, are overall of significant faced proud

we our regarding and XXXX, increasingly strength are markets. optimistic backlog we underlying end the enter of As is our solid,

Given these guidance. factors, our introduce we to excited XXXX are

million plan future other and initiatives. significant and We we million additional for we EBITDA growth revenue the share. vehicle million and million, to growth million $X.XX the up $XX needs, $XXX our make in to be to both Velocity to to $XX production adjusted revenue year-over-year, CapEx XX% adjusted expect production $XXX this as $X.XX support for per XXXX to $XX in EPS to range with to growth of of investments approximately support of of with range To see expect million $XXX and profits

for Daryl I'll Now turn call to back the closing remarks.

Daryl Adams

commitment this excellence you, commitment brought, the week, environment to hard the successful I to many had Despite team a varied customers, we the faced to business reemphasize and This Thank work adverse our in of an year. employees we an and rose dedication I bonus. of an the year. $XXX incredibly our Jon. fear team and occasion. within challenges relentless all hard work, awarded throughout demonstrated unusual economy characterized recognition by how by want am our XXXX our we their uncertainty, and proud of to When special

we the potential As by excited power move XXXX, and into evolving newly we transformed of are our company. and earnings

products in the the our response last we are on years choices to We to and opportunities space, ready markets increased to request will for on value take EV that, continue the call. deliver invest in shareholder With in focus M&A portion new mile make and we operator, will come. prudent to of customers' that Q&A will delivery with

Operator

[Operator Instructions].

comes question Shlisky first from of The Colliers Securities. Mike

Michael Shlisky

Okay.

thinking first color side. on little both, we any revenue steel year? the quarter for you the should the about very from this I kind So normal Are think outlook near on of in on margin OEMs Actually, there to the price side. the term? concerns do just a near-term seasonality of here far and margin be largely you in as near-term the this get want the will as in of somewhat of be Chassis any Or the availability the

Jonathan Douyard

Yes. This is Jon.

start off as think we expect I seasonality. normal would year, the I

I to year. similar think QX last somewhat look the of QX will

steel we basis. of pricing and pricing in aluminum general, on monitoring terms a and this certainly commodity In regular are

us will half through we're But We a discussed the this half certainly past, of of shape well, inflation talked on for and the in the bit things be year. year. second good side into as here, particular, like first a aluminum of on in have, feel and I the headwind in -- out think, which about we of labor the year

close a any think, here think the to customers, see impact, little in we'll I our with but first from first half. don't to as perspective, short-term Daryl stay it Chassis we've noted, probably in I the we continue quarter, impact seen

Michael Shlisky

-- Can certain I'm both what offering of at you're market. Great. EV we are to curious, of I'm the switch the commentary point, kind least. on just kind some over at this curious, EVs that customers in tipping general? over we're think of next of to couple quarters? or their XXXX And change any you do in over desire some about the point telling in at point you adopt kind models,

Daryl Adams

I'll this. Daryl. Yes. Mike, this take is

We in consistent we've EV with believe talked think going we're stay I to what about the past. coming. is

they recent some of a their of been good to still the start-ups. bit OEMs allow ice there's by we're I will EV EV think how conversion some vehicles have position. of I a problem a some going of on that changes in the to little for think But is

get they're needs We bigger from having a role their continue they today. EV to stronger right? in they're for -- customers requests seeing continue because the to play vehicles market to And our not have their meet on us anyone not in

to to going serious we playing we're it some the idea, we Transit they're for about them type with a partnership looking it's expected. offering over if end think to I probably we're their want of think seeing. Other the what all still the So have I continue customers year, we and with And that, understand we're the not get Ford out products than about needs have. so, us. And BEV. closely. or good with next understand the work And excited as We're a they more maybe of X/X but by our

Michael Shlisky

also it Or some getting kind just a there of orders is And a to different got of the capacity more that this compared of curious, for Vehicle for orders that you? FX. with the what's other -- FX you're feel offer? Are on And space white van the not Okay. to get that primary you currently Velocity on product? I'm just for switching cargo your then to that if from or I categories now. transit? Could pull just for business a you've want it

Daryl Adams

Yes.

seen. And in I walk We're -- can we if -- we're to having. there, about that right? accelerate Vehicle be excited the our I is on orders. it's we upfit cannibalizing you think, about velocity, that not the think volume to all excited The can have any we've it's that backlog, additive it from do. capacity we we're in respects. van in Mike, And see the needed. have continues the our conversations in add facility, And excited then other It's shift whether continue whether if or the it's another about we

an team customers' has we And it, -- if we last in can so the space. than additional talked into anybody will we've service need the then years our down X locations. flexible. our do truck We things with the some moving that and I And have City, right, our We we we're all adjust body increase think Kansas about that can which on we needs. volume, the moving proven Florida is proven better doing, and are we seeing. we're into of body based backlog

probably facilities move, now. to X, its our manufacturing right starting years benefits X years building reap ago, ago, flexible So start to is

Operator

Dyer The comes Craig-Hallum. Steve question with next from

Steve Dyer

FVS up large out? sort customer there? pretty overwhelmingly sequentially. well is there large it order backlog or was Is significantly spread of in Or fairly any

Jonathan Douyard

Yes.

backlog saw reflected the to Daryl's specifically think in But at it's which end think a that. that -- customers. the driver a from number. the big probably that of volume incremental was I of was point, into velocity year. I the get order, in won't we the And And

Daryl Adams

Hey, think saying, were talk the due I lot about, by to of They're as there's think heard QX come. understand before, And that how people rental our talking some being buy in it's and -- coming. think don't questions that we them. to vehicles going say I'd frustrated well. used meeting about investors to but online. a backlog vehicles saw with you, I are about continue Steve, as And we they than year UPS, FedEx, going and we're were I I ever showing Amazon this COVID -- from is we've us Yes, And deliver to think QX. others, you're -- the more to what to I of I continue also and it, and our this market know them by there's

-- order the dispersed. So backlog the is

with least some seeing I the things some we're And we on bigger year. X delivery from it at talks third of think customers. the for this have

Steve Dyer

And around been food I I et a update, report them, with delivery things delivery it. unit sort think, piloting on then Anything know Got food new the of things? some cetera. you've, any to refrigeration on of piece

Daryl Adams

we think, product based unit to companies Now refrigeration different get with our they working the try continue going specs. refine this to just new to them economical customer the space. to their give going longer can most on I And efficient to is feedback, bit talked and they're it I to exactly as before, a take vehicles. understand a how use little It's to

and test. continuing levels we're different as supply So to of a have dialogue rev vehicles

Steve Dyer

touched manufacturing. And flexible you on the Okay.

last relates of where of I to curious, you of geographically? kind capacity as there? raw capacity, years. But put at and have around both amount have. you Are of it your what country in in the capacity the a of sort you and ring still kind you Just looking X, add to terms country the as you are look additional where in you've X know

Daryl Adams

capacity Kansas in go facility. with and We added velocity. back We acquisition Charlotte around if It's up you some City. move to space we've capacity an Florida. things us in made in We've think Maine added look, in FX. give some I another

think now, think I space. are of out it's because pretty very question, So right much good a I we

that this grow. of next additional the expecting to of some have the And as move facility. be to capital we're have to year continues would that's type volume So some

Steve Dyer

And then and for it hand I'll just over. lastly me,

your still any be it of would to relates eye the have for out As sort sort to there strategic appetite? acquisitions, fit? helpful Or your of you as right color

Daryl Adams

Yes.

but was And to were We're wasn't are there you slow. larger activity. see think one a the of leg, acquisition, decided were actually little that starting understands and looking that, we're more fit last right will, third year a for close everybody that this number I the ones still to right year, then if now.

moved that plenty at some look year. we forward end looking and there's activity the the table away, more we're the on but of before So to

Steve Dyer

guys. Congratulations,

Operator

next The from James. comes question Raymond of Boeschen Felix

Felix Boeschen

of just obviously very a was clarification. to backlog fleet vehicles was on I hoping start number with strong. The point very, quick

Just to in order X,XXX included of was velocity clarify, number the as that 'XX? XQ full backlog

Daryl Adams

correct. That's

Felix Boeschen

Got it.

on a lower question the towards And vehicle Okay. talk I Daryl. then the sizes, standpoint, just parcel bit to picture a last in bigger mean you us about specifically maybe can the little shift just one Velocity, market. from

be I a think for a like it's it seems been that tailwind the for big velocity. but happening should while,

us have the if three curious first Just you could here? the of how over months kind conversations on year update customer tracked of

Daryl Adams

talked And payload them actually Yes. the the fuel out, question, rolled van. And X size. the we in after Class typical it Felix, that the this walk-in understand right, started, helping before double We've is good very benefits. is similar efficiency

bit the requests the actually some it is to maybe they and And had change it's And vehicle have an of a was quick X really country. volume. into our space us. of space this, flexible. did might of van and and change that for the in Class We've height cargo the honestly, to were for get So limited roof great engineers simple which the that lower it received Early deal. we cargo vehicle they a out the developing the a in more the it's nice great, Class little from feedback -- this a a has was we X the payload versus with on, space And hit vehicle aerodynamics us. Lower customers. a some that inside area that capacity some fit move for tightness park

this. be. it's is, a job nice It where say, flexible, maybe again, should So where to needed the I really engineers designing adjustable did

So it's an exciting vehicle new for us.

Felix Boeschen

to switching bit. Got the then helpful. side it. And little margin maybe That's a

pieces I outlook, few in As moving about P&L. there's quite a the know we the think 'XX

of kind But a come chain side on any little help how cost back Jon, online? T&E about talked see in chip supply of out guide? you the the very as And the if maybe you're far. maybe You into year cuts, curious rolling into you anticipate could back us if little and sort much then P&L travel bit this drags so temporary on we baking impact

Jonathan Douyard

Yes.

I So million look we about -- headwinds of take in as second we out quarter. countermeasures as that at sort mean, we perspective, year-over-year of short-term $X.X from the did

you about restructuring flows into that's some offset the that really by benefits think XXXX, of As how that we did.

I think on our expenses top in saw of that, decline we healthcare XXXX.

a And expenses. -- increase $X in also healthcare million estimating inflation so and particularly press that related releases ramp headwind about there in social as the you as seen probably number be our rate, we're significantly hourly from had. labor will media through trying some we're of increases facilities, of have got to wage pretty activity We've and of to the the the we've

to to levels in velocity. business And investing ground the with QX, as here We the going will first getting of to are invest in anticipate that a and the so part able as started forward. be headwinds volume in that hit continue essentially those the off we well that year we in

headwinds certainly you the at midpoint we if as -- are guidance, And we're you margin that well. some showing But slight at items, those the there there perspective are cost expansion so year-over-year. look as from of look

Felix Boeschen

super Okay. just then last my And That helpful. was one.

facility about specifically is production, that of question. I Could guess, talked bit has point a How has talk the expanding guys about touched little it. a sort labor? on a other bigger the your you site presentation, of my from there tracked? the briefly You of on footprint. in capacity, And you of network to been constraint But

Daryl Adams

production. has at having are there It The constraint Felix. to are Daryl, not locations is that teams been attendance to job this Yes, hiring and pushing HR still a good them.

we hindering now, us don't it see at all. right So

people HR and move getting job, and training to with now, interviewing doing floor. the we're continue are volume teams, the the a new great ramp, the increases through we teams along As Right the monitor. ops on -- will

Operator

from comes question Steve next & of Sidoti The O'Hara Company.

Steve O'Hara

I Just But of mean, kind drops maybe how I used you're that back? about just can increase going of kind is a longer-term you XXXX. and of CapEx seems the then CapEx. forward. pretty curious this function facilities is a it step like Or maybe something think on out where building be big for change? CapEx it kind I'm mean,

Jonathan Douyard

No.

be the the that. I'd XX% -- line Certainly, say increase Velocity here. in it's facility new year largest of meet to investment And accommodate until City that the into designed is talked think of there Daryl about, body specifically the as truck a expansion top we it's basically -- the We're we're, with markets to for piece levels. I also a launching investment Kansas about line volume some associated will that. talked

move we beyond. the And say, capacity this or that X see X and 'XX forward we should we so benefits order of that investments year larger there's, as I'd the into need in to support volume increase, and

Daryl Adams

adding less purchase these launch, job a really internally, a seeing getting more continue buy. the some facilities, of optimize we're lasers are payback fabrication I'll doing with parts number make the Steve, equipment at than a or to with add in order little bit a in to we're nice to teams and The buying year. along

capital besides the some that that's that about. the talking of facilities So part Jon additional was

Steve O'Hara

change replacement That's Okay. the the in that of it shorten XXXX quicken of and been then there's in can seems road there's do out? helpful. cycle you How I there EV gets XXXX? And does plays any pace -- the maybe But cycle? factored replacement of was in. part very if fleets the the utilization think high if span? on was that been road, utilization the and Does think where Or think -- you takes I that you do -- maybe is mean that down talk in like you guess the are life that terms about that about today,

Daryl Adams

years, the routes. Xs, at maybe dialogue and vans, the all X Yes. of It's some we're the having going XX-or-so. around some having that We're on volume We're for X they're conversations customers that, the is shorten a that going labeled cargo XX-year the to somewhere of lot been expectations depending coming with X point, Absolutely, maybe coming the and typical life. -- and that's in instance, through Class seeing less from vans a in, the little dialogue Class some bit a and dialogue. But seeing customers were the XXX%. life. in we're through seeing X vehicles now. And amount the to walk-in your as and past of Then utilization, has so the

little and and So and probably we bit that coming doing then cycle actually some year believe next maybe that, continue of beyond that that's quicker. a will 'XX replacement start

Steve O'Hara

do then EV. And kind mean, launched you guys you -- I'm and maybe deliveries of in maybe starts I deal I kind I from -- their it of in I'm everybody? think X penetration? continue next as to XX% that just talked in want kind of switching what to to then on few you the mean, expect to you about of just see side. years is maybe. do agnostic you of years stay And kind XX%? GM have playing how staying terms of curious, guess, out agnostic past, platform. think the curious that And that of do Okay. it see with how terms EV I build now, the just you

Daryl Adams

Yes.

so could else. EV I if exactly estimate, we're and what on that we know doing everyone think on I with be accurate

say to -- question, bit don't it's a want question. a it's a load a of but difficult So I of

it some -- be in XXXX It's they do different was and sources. or for XX%. it we of go to by think XXXX accurate But so sources. at. I to of said we to We see try it -- your use to we Bloomberg think our have I I they to there's us is how think, going were. don't ourselves. agnostic. that's going But point -- who coming. by think some what actually the volume outside to get looking XXXX, they I be lower being outside analyst everybody, And what And first. loved see, we seen is where what XXXX, I But predict earnings might would deck had have predicted actually it think larger So

are a times they're their seen think in we I that vehicles meet of because needs. script receiving lot from pressure needs are it of I not their I a think any customers today, the our evolving. or getting actually And mentioned couple

be changing and on it's some going take But review. some is analysis to our now, of our same. what that's but the more position it, view might So more some right

believe we we're coming is say going did And And the come is wait track. still to understand working the on theirs. We next with OEMs FCA/Atlantis we theirs will year year. out. Mercedes for that Ford's -- this gap later are and We on out to bridge have We one.

convert they So one ice vehicles to eventually, the mention there. did or right, OEMs be of engines that and maintain people stopped, their warranty. letting will the I EV over

that the do So if voided. you warranties anymore, are

it's in news, going in So two. to -- think, quarter next I EV so to new that's here, space some going the that's create havoc or the probably

Steve O'Hara

see Body you their is shape. on in of the I Truck kind acute I how Is how of but it, ramping of demand it maybe mean, the that the FVS, Body within Okay. like is primarily deal mentioned But just And then gotten on fleets they've see that side. you the delivery. kind meet there. of mean, have then Again, out? I was growth of And that up. the the it to playing with maybe the seemed mean, and parcel And they out? kind first when you it delivery parcel kind playing kind Truck backlog maybe

Daryl Adams

I excluded. we've the not product strong across would all Truck orders pretty Body say actually offerings, seen

So as in look walk-in and the talked have that's about. of back of the we QX, to And through we was, there rental year. normalize and the their got to order piece gets itself point needs. normal high script a to of our see strength that as essentially QX, the And new about we big discussions extremely through upfit end made market. Truck utilization we're about we obviously, continue have good operating with continue a to Velocity here van Bodies with in sort seen strong in the at customers it in level patterns,

our building And that is customer so for really out situation. base

Operator

comes Roth question Capital. from Matt next The of Koranda

Matthew Koranda

at higher maybe out start level. I the off guidance wanted discussing by zooming and just a to

how between and terms could assuming So the us that's are basic just of you And then you inorganic from FES in specialty in split understand assumptions much around DuraMag? help the vehicle contribution outlook? the

Jonathan Douyard

Yes.

So see when XX%. growth there. above the in there's of we that are on different actually both year-over-year them X of actually target And guidance, dynamics the we strong look much at see we segments. Both growing at pretty right

strong a call the saw business, the out the SV where some, half. you've of business coming tailwinds we on got first of softer -- motorhome also side got it, You've

as there And talked as DuraMag, recovery so inorganic piece in to well as you there's about. some COVID the

growth side the of inorganic acquisition parcel fleet both continued business, On call the side see growth, going but I in of the we products that delivery points business, the from say, forward. organic it's X an of related. perspective, expansion it, there's would strong and that's the the or of really probably,

Matthew Koranda

helpful. That's Okay.

Sorry, ahead. go

Jonathan Douyard

the significant No, million contributor I $XXX year-over-year was just saying, given a revenue. not in increase

Matthew Koranda

And FES? Got did just to forward? get makes that into talk about That we heading could FES, you picks up if a spring. with generally get spring. I seasonal heading order Just you into referenced that current little larger about we're just Yes. expect Because that pull a in should of to the especially the wondered talk for pattern heading have is a seasonality activity that sense currently environment, order environment typically, the bit normal kind order guys or forward order the additive for, just order the little I sense. Velocity that know And wanted as you. the then bit we

Daryl Adams

to environment think anything it's in. describe Yes, operating the normal, tough I given as we're current

piece was Velocity the certainly think incremental. I

saw our getting second and interest to And service comment to into last things, second slow and happening probably I and historic third think I was we're that's are bodies. of with as the see capacity QX. them. continue we board, seeing aligned the where and close earlier, an dynamics order a on But pickup strong their order we are stay here the of right, products, -- through customers not to to late patterns we seasonality. year very and And ordering smarter about continue in my across of sizing all motorhome acceleration sort think those types bit we requirements quarter, a fleet of there

Matthew Koranda

can Great. it order your produce, And sense which so wondered deters wanted you lastly, But that it point, maybe backlog capacity if just problem flow. I we what up finer like And is then ramp what of I on of around you ramp referenced just a you of and But in can constrain there. different the FES? the FES. guys just on is seems quickly at how on or items there? puts sort up X could you've in high-quality terms because maybe got X help you've takes to kind know point then a capacity end, a large for to could ability production maybe lot are your a to of us characterize put some get gating

Daryl Adams

I'm to answer one, this to Matt. attempt going Yes.

down press and mentioned some other facilities. I were brakes. So the of with some buying of in we're along equipment Those some laser the Bristol,

payback, run supply half. a So shift, constraints nice and before, as seeing some -- too. on right, that typically obviously we mentioned that some and a shift getting We we were the I is helping of

in So in third. we amazing to, fill Kaizen help really is we and throughput. need to if job But with go team the events with their to can some the we have the And second still out the plant an putting shift. automation and doing

companies middle what for the will the cities. show of or the heavy, companies, call vehicles. I the moving, power our, heavy in upfit, now companies super SSV electrical the are maybe like right, we and right We for

a it the We only if But of have of that will you Matt? away basis, get to main in that a orders for level. we're to Go some right? backup have are now we're But more out room the -- a orders Do on have we that operate the The paint, from flow facility and we right right? moving to real question, a Moving constraint units different getting. with ahead. is. is level reaching another that give daily paint number Bristol, continue to of plant be to

Andrew. Sorry,

Operator

any session. turn question-and-answer our to the back Pagrabs remarks. to would like closing Apologies. This over concludes conference Juris I for

Juris Pagrabs

Thanks, joining and Andrew, us everyone, today. thanks, for

joining, can throughout forward we We that, have and ROTH a look when everyone. next we our on conferences look we're couple the virtual. to next to in the you in, of couple and Still of And Thanks, going updated this forward in-person. be to for progress We Sidoti. do participating weeks, week day that keeping XXXX. with thanks

Daryl Adams

Thank you.

Operator

today's concluded. conference The you presentation. for attending has now Thank

You may disconnect. now

The Shyft Group, Inc. (SHYF) 11 Mar 212020 Q4 Earnings call transcript