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01/10 16:03
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights positive financial metrics such as increased revenue, strong EV sales, and a healthy cash position. However, concerns about supply chain challenges, regulatory uncertainty, and competitive pressures balance this positivity. The Q&A session reveals management's vague responses on key issues like margin improvements and EV pricing. Despite a share repurchase program, the mixed signals from guidance and external challenges suggest a neutral sentiment, with limited immediate stock price movement expected.
Revenue $359 million, up $13 million (3.8%) year-over-year, driven by pricing actions and increased EV volume.
Adjusted EBITDA $49 million (14% margin), up $3 million (6.5%) year-over-year, attributed to high bus and parts margins, partially offset by increased investments in headcount and engineering.
Adjusted Free Cash Flow $19 million, down $35 million year-over-year, primarily due to a tax carry-forward benefit in the previous year.
Bus Sales 2,295 units sold, with bus net revenue of $333 million, up $15 million year-over-year due to higher EV mix and improved pricing.
Average Selling Price per Bus $145,000, up $4,000 (approximately 3%) year-over-year.
Gross Margin 19.7%, up 130 basis points year-over-year.
Adjusted Net Income $32 million, up $2 million year-over-year.
Adjusted Diluted Earnings per Share $0.96, up $0.07 year-over-year.
Cash Position $131 million, near record levels, with liquidity at $274 million, up $38 million year-over-year.
Debt Reduction Reduced by approximately $5 million year-over-year.
Operating Cash Flow $29 million, driven by operational execution and improvements in working capital.
Backlog of Buses 4,900 units, representing $770 million in revenue.
EV Sales 265 units sold, up 26% year-over-year.
Parts Revenue $26 million, flat from Q1, down $2 million year-over-year.
New Product Launch: Debuted Blue Bird commercial chassis at the Work Truck Show in Indianapolis, scheduled to launch in 2026, available in propane or EV.
Market Demand: Strong demand for school buses with a backlog of 4,900 units representing $770 million in revenue.
EV Sales: Sold 265 EVs in Q2, with a total of 1,100 EVs in backlog.
Operational Efficiency: Achieved record adjusted EBITDA of $49 million, a 14% margin, and maintained operational stability.
Production Capacity: Backlog of nearly 5,000 units ensures over six months of production.
Strategic Shift: Prioritizing ICE buses due to tariff impacts on EVs, implementing price increases to mitigate costs.
Tariff Impact: The company is facing significant challenges due to the current administration's tariff policies, particularly a 145% tariff on imports from China, which affects the cost of EV components. This has led to a decision to prioritize internal combustion engine (ICE) buses over electric vehicles (EVs) until the tariff situation is resolved.
Supply Chain Challenges: The supply chain remains fragile, with ongoing material cost and supply inflation pressures. The company is working with supply chain partners to find alternative sources in North America, which may take time.
Regulatory Uncertainty: There is uncertainty regarding the timing of future rounds of the EPA Clean School Bus Program, which could impact funding and sales.
Competitive Pressures: The company is experiencing competitive pressures in the EV market, with some competitors going out of business, but it remains a leader in the segment.
Economic Factors: The overall economic environment, including inflation and material costs, continues to pose challenges for the business.
Record Quarterly Revenue: Achieved record quarterly revenue of $359 million, $13 million ahead of last year.
Backlog: Ended the quarter with a backlog of just under 5,000 units, representing over $770 million in revenue.
Investment in Operations: Reinvesting in operations by updating facilities and focusing on lean production systems.
New Product Launch: Debuted Blue Bird commercial chassis at the Work Truck Show, scheduled to launch in 2026.
EV Sales Forecast: Forecasting 800 to 1,000 EV unit sales for the full year.
Full Year Revenue Guidance: Maintaining revenue guidance of $1.4 billion to $1.5 billion.
Adjusted EBITDA Guidance: Confirming adjusted EBITDA guidance of $200 million, with a range of $190 million to $210 million.
Adjusted EBITDA Margin: Forecasting a 14% adjusted EBITDA margin for fiscal 2025.
Free Cash Flow Guidance: Expecting adjusted free cash flow of $60 million to $80 million.
Long-term Revenue Target: Long-term target remains $1.85 billion to $2 billion in revenue by 2028.
Share Repurchase Program: Executed another tranche of share repurchases accelerated to $20 million during fiscal 2025 Q2, bringing the total to $40 million completed over the last nine months with another $20 million left to go on the existing program approved by the Board.
The earnings call reflects a positive outlook with raised revenue and EBITDA guidance, an increased share repurchase program, and a strong EV sales forecast. The Q&A section reveals confidence in state subsidies over federal programs and stable demand despite earlier tariff issues. While management was unclear on some metrics, overall sentiment is positive, supported by a strong backlog and strategic investments. Considering the market cap of $1.76 billion, the stock is likely to see a positive movement of 2% to 8%.
The earnings call highlighted strong financial performance with record revenue, increased sales volumes, and improved margins. Despite some concerns about backlog and tariffs, management's optimism about order recovery and sustainable margins is reassuring. The Q&A session revealed confidence in EV momentum and addressed pricing concerns, suggesting stability. The positive outlook on financial metrics and strategic initiatives, including automation and state incentives, supports a positive sentiment. Given the company's mid-cap status, the stock is likely to react positively in the short term, with a predicted price movement between 2% and 8%.
The earnings call highlights positive financial metrics such as increased revenue, strong EV sales, and a healthy cash position. However, concerns about supply chain challenges, regulatory uncertainty, and competitive pressures balance this positivity. The Q&A session reveals management's vague responses on key issues like margin improvements and EV pricing. Despite a share repurchase program, the mixed signals from guidance and external challenges suggest a neutral sentiment, with limited immediate stock price movement expected.
The earnings call reveals strong financial performance, with increased EBITDA margin and liquidity, and a robust share buyback program. Despite risks from tariffs and funding pauses, the company maintains optimistic guidance and growth plans, particularly in EV sales. The market strategy and shareholder return plans are well-received, though some uncertainties remain. Given the company's small-cap status, the positive sentiment and strategic initiatives are likely to result in a 2% to 8% stock price increase over the next two weeks.
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