SHYF - Earnings call transcript Q4 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to The Shyft Group's Fourth Quarter and Full Year 2024 Conference Call and webcast. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce Randy Wilson, Vice President of Investor Relations and Treasury for The Shyft Group. Please go ahead.

Randy Wilson

Good morning, and thank you for joining us. from Ocholik, President Interim hear Officer; Chief will Scott and Chief you John and Dunn, Executive Today, Financial Officer.

will remarks prepared be a by Their question-and-answer followed session.

the XX-Q Slides begin, conference Today's could forward-looking subject and turn cause we are contains our to which risks Before X harbor our results filed please call Forms management believes of to presentation statements, that implied. Primary to risks our SEC. be statement. materially the actual in materially with different results for safe X affect from XX-K identified those and expressed that or are could

We conference evaluating discussing information the call materials. which be these measures, in performance. will operating can be for Reconciliations and believe performance company's non-GAAP useful the non-GAAP in are measures we found

John, an with Scott's Schmidt. with our our XXXX Aebi We a by fourth financial up from finish update with will overview business our results followed quarter begin presentation on outlook. and of review merger will pending John

will line We for then Q&A. the open

turn turn will remarks. Slide prepared over today's begin to John, who Please and it X, I'll to

John Dunn

combine Shyft's of specialty vehicles and relationships step companies. our merger Schmidt, good the we vehicles We Randy, in our earnings proposed in capabilities was enhanced in solid achieved strategy, December, next journey, we a announced incredible with Thank operational In XXXX both we call, scale, our Shyft and deeper Together, expertise appreciate company. strides your you, to specialty interest a Welcome and The for will year strengths customer and improvements an made Group. morning. highly leading significant leader powerful company. global as we our delivered advancing financial performance. with Aebi and create a competitive

we commercial The intense with our and Let's and some the and Group. costs in throughout performance, our year corporate are seeing We this improved has leveraging kick morning efficiencies XXXX, driven at across By results. consistently focus Shyft improved streamlining implementing by we company. to improvement. organizational team mindset, operational been The structure operational engaged on improvements and financial our Shyft highlights are Shyft our talented increasing highly past margin off from one deliver managing a

margins adjusted business These resulted market, the X.X%, XXX infrastructure expanded to X.X%, for to to year-over-year by meaningful can driving control. testament points basis operational in a parcel execution what fleet margins EBITDA year-over-year. supported steady company demand and margins growth were for vehicles approach efforts EBITDA points up focused with controlling Despite This services performance. our strategic Specialty and our up they a basis is by strong continued team's soft bodies. Vehicles XXX truck of

than enables balance support drive strength long-term going success. initiatives less remains growth solid allowing in us Our capture with opportunities our sheet Xx, invest that to to us strategic leverage flexibility financial This forward. new the net and

complex needs operations. we team. are Blue Arc sustainable fleet milestone to underscores as their meeting production entire serving partner of This exciting Finally, FedEx, and EV our is achievement our more shift choice the our to for an successfully as to to trucks as we they pleased Shyft which commitment fleet transition bring of partners to

XXXX X. framework, has our across We which guided drove in Slide to outline Turning improvements business. operating Shyft we our as

we improved initiative, manufacturing and costs ensuring efficiency initiatives XXXX. XX% training leadership and and improving safety in our the in reduced by workplace talent, Lean injuries with market. Strengthening Mission Zero competitiveness lowered

possible. accomplishments would we not year, work sets, done have are proud this thank skill dedication I and like of the would and team. Without we to be our summary, In their our

and his welcome he review will our and provide a financial Scott to first results now would of Shyft detailed outlook. call, I Ocholik like to earnings XXXX

Scott Ocholik

Thank you, John.

introduce to to Controller. I global years moment over interim the to the myself. here have of automotive experience Accounting to I First, and years, Chief supply look CFO to of been over as a several Shyft. with the at have Officer company's next X in and Corporate specialty the I for Shyft I'd XX serving like many forward vehicle opportunity have I'm meeting very markets, be you and excited over weeks. take the

fourth overview please fourth our down our slightly meaningful in and for from team start Slide in delivered quarter. Overall, the $XXX.X With million X, year. said, will that quarter to the were financial prior profitability of results. turn I quarter with the improvement million, $XXX.X in Sales an

loss per or share Our $X.XX net loss million year. previous $X.X net or share in a compared $X.X the to was of GAAP million per $X.XX

fourth of net of sales, up These negatively EPS spend, $X.XX quarter from in pending for of to million transaction $X.X negative was the or an costs $X.XX a Aebi the or compared $X.X adjusted million, Schmidt. EBITDA impacted $XXX,XXX prior results fourth million loss share income XXXX. EV quarter quarter quarter of was the merger net The loss related and for XXXX. a is million of per $X in in million Adjusted was $XX.X adjusted X.X% sales the to increased which for with year. X.X% from include million basis, down quarter of per the share to $X.X the of by or On the $X.X

despite million results year to lower improved operating by compared of loss quarter sales to X% and softness in by in with $XX.X our offset softness million XX.X% challenging these ago, Adjusted throughout continued of to X.X% and volume. on will $XXX.X continued continued times. million, million the achievements reflecting In parcel quarter walk EBITDA ago, improvement positive at by demand. year a share we This but negative year. segment a volumes for team of FVS a gains sales through the our to walk-in vans, the Slide van I year-end, product the heavy in turn the a walk-in in compared margin higher XXXX, Please achieved to operational $XXX our reflecting & Vehicles achieve offset environment of a higher $X.X speaks versus of challenging down productivity XX.X% fourth up-fits. our $XXX.X did strength Adjusted the Fleet in note, during the last X, parcel, EBITDA year line market Services down segment. margin backlog was versus for million was quarter, made

segment. Turning Vehicles to Specialty

team year. Our line closed in prior XXXX out with with profitability

sales in truck solid in motorhome. As XX.X% million $XX.X last same a or offsetting X% to $XX million EBITDA was businesses our delivered infrastructure-focused the Adjusted the quarter of in of year. were from the Fourth $XX.X $XX.X market prior sales or ongoing vocational sales weakness increase million, results, period million compared XX% year.

With motorhome backlog turn by results This this XXXX was for by momentum was overall X infrastructure-related strong to into driven continue of improved XX.X% $XX.X are outlook. profitability our orders. steady million end year, Please continued vocational the at versus XXXX. driven down trucks. in Slide demand and margin expansion SV the for XXXX. This primarily the this our to decrease a financial quarter, we poised was

the softness anticipate near-term enter We cautious the driving motorhome do, recovery as and we and Our in however, focus modest a remain as on motorhome growth midyear. profitability half second expect improvement. year. do for vehicles to parcel demand parcel of both the on we and XXXX markets We through in the persist remains

spend the our be impacts have may to monitoring vocational we strong, continuing are also truck closely and potential it infrastructure business. While on

will We Arc is expect breakeven the and production full Blue year-over-year profitability growth as underway reach for near year.

$XXX XXXX introducing factors in be operating related $XX our notwithstanding outlook as to are million This environment, we million the further range million. Arc. Given expect of sales includes to to the Blue $XXX changes and follows: we these approximately in

the historical million. and slow to seasonality, and of start we Full quarter expect the adjusted $XX anticipate with EBITDA the be year the adjusted patterns to Consistent single low in EBITDA to range digits. first year million $XX in a

a in the around second markets, our of half delivered recovery year. of As be to we see the adjusted we full half year second EBITDA in expect XX%

the per the million, on as up our includes basis. to improvements EPS flow million to merger adjusted year-over-year of meaningfully driving of transaction-related expect proposed million a finalize year. $XX Aebi recover we approximately and cash We We further the to with remain performance markets And Schmidt. in be paid $X.XX end free range during cash expected $XX financial in of our committed $X.XX $XX share. This to

With will provide back John I to to that, it the turn on over an merger. update

John Dunn

end please and markets, move approximately capture space employees. positions in turn to market, commercial specialty our XX% presents our a the vehicles to infrastructure. XX. American and North businesses presence bringing us Scott, a are Aebi together, By This Thanks, leader be in of in the creating a customers with we opportunities high-margin growth proposed opportunity generated. merger robust compelling strategic Schmidt differentiated shareholders, where Slide our revenues will including for This with

provide suite deep relationships. complementary and services, on innovation highly our customer-centric driven unwavering and For focus our and merger will customers, a customer expanded of the by products

For and by shareholders, our value capitalizing product on financial and our drive the will leveraging synergies, company a combined will expertise. stronger profile have offerings expanding team's

our common and We this Our share confident shareholders, and of interest operational collective members. a people merger in commitment that focus believe success. our is innovation, best to the customers making us customer in team excellence,

provided to we leadership. solid potential, the projections and announcing Schmidt's progress turn creation I completing progress closing other HSR value market work, made the data Slide which including are additional approval and actions strong making integration needed we on well towards Since close. We In will Aebi financial achieved January, conditions. underway. XX, the Now discuss and to transaction, regulatory is merger's and reinforcing the have information antitrust in

track both integrating Schmidt have integration strong established successfully and leveraging team. and joint Shyft a are of Aebi We businesses records

by taking updates are closing, and look which companies we Overall, are providing forward steps as integrate our seamlessly, I we to mid-XXXX. more the preparing expect X progress we to towards

on combined businesses working the full for on of shareholders day company value deliver We diligently and are enhanced potential our integrating the to our one. capture

We your are line. take Operator, now the questions. open please to ready

Operator

the in [Technical We with me. Please lines a questions moment. for bear will up open Difficulty]

John Dunn

you. please live, morning, if can Operator, can difficulty I but go I hear your have technical you appreciate having this Matt We're patience. please.

Matt Koranda

million Sorry, hear It in Also breakeven approach remarks, in in on like guide, there. outlook you okay. $XX this -- respect think wanted correctly Arc I to EV. sales my the XXXX sounds prepared Blue EBITDA about should the and you queue embedded That's talk didn't with I year. to I heard guys the

you other the FedEx hear talk customers? a do the orders on the I this little with you field wanted year. progress on have cadence of about in delivery there. Any hand update program to talk in bit just Just to all on the or vehicles more love deliver $XX Maybe the million? to hear would sort of about color

John Dunn

on update an Matt. This you that. is I Great, John. can give

in are production we a with are line to was off XXX for coming of running vehicles our So day the That the fulfill orders. phase contract couple FedEx.

So expectations. vehicles perform we're to continue working and field The in through right that order well the meet now.

In meeting -- performing one FedEx, our have to Canada, a running addition of climate so of cold experiencing running we customers, other the in them up key demos couple with expectations. well, all

about use it. the getting can to excited phase and we we're vehicle customers give of it where it the really So now to performance the to

making FedEx deploying, we're vehicles on very and continue positive is to it. be the

as it If the sorting there's a right to right order what on out EV. service. out now market standpoint, are you're a at there From dynamic is for example, LAX, now couple do an in people

we're into bigger a more And friendly of see leaning see road we big to order is we the here lot fleets EVs. and these our though, to confident The partners. The from vehicles get on activity, commitment really are to that still that, how standpoint, will materialize. environmentally continue Fortunately, seeing from key of well lot work. they enabler solution an starting of a people that transition out

more more on that the more positive we the road vehicles have, people orders. so expectation lead continue we'll the to is the to have, And experiences

Matt Koranda

do orders Okay. But the incremental in you have this of million you orders the in enough have $XX without terms year? fulfill hand, to

John Dunn

shortly, need do breakeven. To under And as there can we're amount short an it to orders. that, get We're of as where, be it's the we to full have to at that's additional announcement orders, we hoping yet. -- to and do need that striving mentioned Scott XXX area we're another but needed. We not well,

Matt Koranda

right. Understood. All Okay.

fleets parcel what's wanted a like Vehicle outlook on going about demand on talk for segment, to the then little love demand customers, assuming 'XX. hear to fits recovery this hearing And are Maybe you I of that back just Okay. in see particular? terms -- to of bit the It you Would an in we're of confidence year. in hear the fleet year. about the that Fleet just prediction half from the more embedded and in sounds parcel know what a kind market. gives in FES starts there. that's in of What recovery you're common this the recovery update

John Dunn

We're needs is news and parcel exactly with they're to those their customers, they're not key staying changing making packages very their homes. The on understand close the concept we good parcel sure delivering plans. how

So vehicles we that make. they still want large these

of in the or robust, they're right of those maintain Because vehicles of slightly. them purchases push wheelhouse. it's these those and push are so out some able kind So some to purchases down

nice it what one cycle now. seeing need going It's of pushing Eventually, that years there's been be should in, about in. We're it see matter we X when. But that yet. kicks and they've just is a kicking replacement for a not a out to be to

why half of is customers the to and this it year. to we're that guiding that to with happen that's it's year. going good we're So saying But an in conversations second second and indication in of going understand half happen, the having we're seeing the when there's

Matt Koranda

soft then And driving Maybe sort to order turn could of weakness that motorhome Vehicle, on sort speak guess little core if I Is at would to the and it order you it. the in the Could just What business? be in over Specialty flow was just just the implied I'll else. still in that? order bulk someone Vehicle, truck seeing you are you Vehicle. what's that of you're unpack of Got Specialty trends that piece segment? getting that that's the helpful? the driving then Okay. work the implied flow Specialty on a of

Scott Ocholik

is this question. Matt, the Scott. Yes, Thanks for

You're there really the weakness the weakness right. things. We're driving the that's motorhome that continuing market side of to in on see

especially it's our first we're starting the XXXX, there of we're the strong of part see actually side On -- here very see work strong orders business, We're and to truck steady. -- been continuing to continuing in orders.

be XXXX. continue to So to that steady we're expecting into

that's So the main thing.

the than levels. On now, lower side, at are their dealers, inventories pre-pandemic levels the motorhome pre-pandemic

inventories they've place. I in So think got their

inventory. more being little thoughtful And think, planning I now just their they're, a their on on

as but So, orders to up second the of well. do half we pick on into we move as the here anticipate year motorhome the

Operator

D.A. question is Mike Davidson. from with next The Shlisky

Michael Shlisky

sounds better about Your of comments of in like drivers trends one infrastructure. were the for growth 'XX, it

its in expecting If that it their XXXX on from to or see be Aebi greater focus Schmidt be mix? as faster Group, fast some in say at Shyft Group infrastructure fair would their, infrastructure you're growth business that than growing given to know what overall in you will Shyft

John Dunn

broader to We with based and And I our that aspects range key Group. of a think coordinate really think of merger, that's that's nationwide this The better Shyft of I a Aebi for thanks we activities, the footprint access question. the can -- together Schmidt bringing infrastructure business have do one upfit have that customers.

one the going growth. key points as that see to accelerate we that's our So of

they're -- on because know seeing specifics of that that in the and phase what growth. they be right still But activity the not seeing sharing information. now the similar we're really we're we have early to merger, As to there

Michael Shlisky

prior that year XX Okay. Pretty FVS just currently fourth to XX, in of positive that like good curve wanted sustainable running? FVS EBITDA about on at swing in million talking Also, over to quarter. sales. We're results margin run of I negative Is there. a How is from where the talk the quarter. points the margin $XXX the rate is the XX%

Scott Ocholik

Yes.

operational some drove. efficiencies the we're We think we that I improvements in certainly margins. great FVS had seeing

I margins double-digit talked getting margins. with And we've to that's you're year-over-year about last consistent several get So that's the also where those to over that seeing think low what quarters.

that So to so It's able really that efficiencies in that yes, space. be high we low maintain there's on there. focus And do us helped to expect operational get double again, digits in space.

Michael Shlisky

I last have one Maybe other for me. question. one it. Got one

John Dunn

Go ahead.

Michael Shlisky

a ask surcharges to still you as we but as be situation, there what about thinking fluid aluminum should at tariffs. wanted stage bit bit it's little I tariffs of there. are I about Yes, out a this know a Do are some And to far as here first potential in flexible you changes pricing situation business? more 'XX that arrangement your kind changes the or other your of have part might of any planned impact the still pricing? tariff there

Scott Ocholik

is Yes. Mike, this Scott.

Let me start off there.

strategy right? out to with do So that's the it multiple couple We the in yes, the situation. over various the helping place includes our alternatives, of threats a through the this impact, last certainly, put appropriate supply still place we impacts. in that to what's us prices years been our evaluating North a scenarios are plans both to these been really It increase of as mitigate to where of chain But supply and risk. we've relating suppliers implemented very offset well tariffs focused and as help there. on have other mitigate plans American the So partnerships is fluid strategy

closely it very continuing to as it quickly watching but are a we're move things to to these be day-to-day. early able impacts, So understand little is

Operator

is next BTIG. The from question DiMatteo Tyler with

Tyler DiMatteo

to I guess similar guess of then outlook know EBITDA the single-digit in the that, to XX% past? the I'm the what's quick wanted curious of in I And for seasonality. on, degree just wanted I to of a QX. then year. be is back follow half to kind I maybe the I that? pointed real follow-up. magnitude and I the have follow comments I up surrounding you on low to hey, this mean know year. I of the seasonality here. outlook it up going

Scott Ocholik

consistent be to with I years. Yes, it's prior going Sure. think

ramping type just that much stronger of space. second do of half benefit as the had year. this slow So our acquisition work truck at XXXX, We continued if of year. of progression We're start we up the you well strength similar ITU a here the expecting to similar and a expect the as look

about Blue We production now, which fact overall perspective. is to going that moved cost spend from the have into an help talked us Arc has

the still QX. I quarter. But in you're comment in digits this a going and us why are in first is which single-digit seeing weakness challenge to on be seeing the space, walk-in And that quarter, we for single this specifically, the motorhome van low think the

Tyler DiMatteo

evolved versus infrastructure, in upfitting the piece I business and Got it. that service the same? about you work and time? here as to you go in that profile. service guess, approach customers, that done about going from maybe I of the and you the nice keeping terms will. of to has your you has strategy kind service And guess maybe I that I if then as -- kind really piece follow-up and guess job I do How how XXXX? But win of kind surrounding my And a the know, core how strategy really over has much perspective, of think how that how you orders? profitability you a a obviously, it of margin product, is of I the think maybe guess, work guys guys the to from guess have from has terms the -- evolved of

John Dunn

to service get bodies, to our Specifically around those be continues nationwide that strategy coverage.

Royal together. more East that on the bringing is Coast, is as we're much the Coast, the West DuraMag and so aluminum on And

products we in facility new where Nashville that there. sell area see You both our

they ITU, so getting example, then for use a Royal through nationwide body. new now either service coverage. partners, And that our or DuraMag it's And

more So vertically there. integrated we're

opportunities sales get the And drive there's body the Aebi into merger as really overall business. Schmidt, to that we integration, with vertical just the of service there more roll

synergies. synergies in about merger, infrastructure. of it. lot together pieces that's identified key in opportunities the space that makes So of one A for that excited that business and coming we've upfit the that is And supporting us

Operator

back concludes closing the you over Wilson, floor for Mr. This session. I like would question-and-answer comments. turn to the to

Randy Wilson

March ROTH joining like Truck Week Indianapolis the at in Conference with to today's XX call. Work X Thank the and looks Management on California you, the forward NTEA connecting and X and Point, XX. Dana everyone on operator. thank for investment I'd at community March to in

you to reach call. disconnect interest have Group, your As The the in always, please you and for that, With thank operator, Shyft me please if questions. any out follow-up

Operator

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

disconnect. now may You

The Shyft Group, Inc. (SHYF) 20 Feb 252024 Q4 Earnings call transcript