Rev Group, Inc. Reports Strong Third Quarter Results, Raises Fiscal 2023 Outlook

  • Third quarter net sales of $680.0 million compared to $594.8 million in the prior year quarter
  • Third quarter net income of $14.9 million compared to net income of $9.5 million in the prior year quarter
  • Third quarter Adjusted EBITDA1 of $39.4 million compared to $29.5 million in the prior year quarter
  • Third quarter Adjusted Net Income1 of $20.9 million compared to $14.3 million in the prior year quarter
  • Raises full-year fiscal 2023 outlook for net sales of $2.55 to $2.6 billion, net income outlook of $27 to $37 million, Adjusted EBITDA of $135 to $145 million, Adjusted Net Income of $63 to $73 million, and Free Cash Flow of $70 to $75 million

REV Group, Inc. (NYSE: REVG), a manufacturer of industry-leading specialty vehicles, today reported results for the three months ended July 31, 2023 (“third quarter 2023”). Consolidated net sales in the third quarter 2023 were $680.0 million, representing an increase of 14.3% compared to $594.8 million for the three months ended July 31, 2022 (“third quarter 2022”). The increase in consolidated net sales was primarily due to higher net sales, including price realization, within the Fire & Emergency (“F&E”) and Commercial segments, partially offset by lower net sales in the Recreation segment.

The company’s third quarter 2023 net income was $14.9 million, or $0.25 per diluted share, which included $1.9 million of restructuring related charges within the F&E segment and corporate. Adjusted Net Income for the third quarter 2023 was $20.9 million, or $0.35 per diluted share, compared to Adjusted Net Income of $14.3 million, or $0.24 per diluted share, in the third quarter 2022. Adjusted EBITDA in the third quarter 2023 was $39.4 million, compared to $29.5 million in the third quarter 2022. The increase in Adjusted EBITDA during the quarter was primarily due to higher contributions from F&E and Commercial segments, partially offset by lower results in the Recreation segment.

“We are pleased to have delivered another strong quarter of operational improvements and financial performance which included $56 million of free cash flow and a strengthened balance sheet,” REV Group Inc. President and CEO, Mark Skonieczny, said. “We remain focused on execution and advancement of REV Drive lean initiatives designed to reduce manufacturing complexity, improve efficiency, and increase throughput. The progress we have made in these operating programs provides us confidence of continued momentum which is reflected in today’s update to our full year fiscal guidance.”

_____________________

1 REV Group, Inc. Adjusted Net Income and Adjusted EBITDA are non-GAAP measures that are reconciled to their nearest GAAP measure later in this release.

REV Group Third Quarter Segment Highlights

Fire & Emergency Segment

Fire & Emergency (F&E) segment net sales were $322.9 million in the third quarter 2023, an increase of $92.8 million, or 40.3%, from $230.1 million in the third quarter 2022. The increase in net sales compared to the prior year quarter was primarily due to increased shipments of fire apparatus and ambulance units, a favorable mix of ambulance units, and price realization. Increased shipments of fire apparatus were primarily the result of an improved supply chain, and labor efficiencies related to initiatives put in place designed to increase productivity. Increased shipments of ambulance units were primarily the result of an improved supply chain, labor efficiencies, and increased headcount that resulted in higher line rates. F&E segment backlog at the end of the third quarter 2023 was $3,220.5 million, an increase of $1,057.4 million compared to $2,163.1 million at the end of the third quarter 2022. The increase was primarily the result of continued demand and strong order intake for fire apparatus and ambulance units, and pricing actions.

F&E segment Adjusted EBITDA was $18.1 million in the third quarter 2023, an increase of $17.1 million, from Adjusted EBITDA of $1.0 million in the third quarter 2022. Profitability within the segment was impacted by higher sales volume, a favorable mix of ambulance units, efficiencies related to productivity initiatives, an improved supply chain and labor markets, and price realization, partially offset by inflationary pressures.

Commercial Segment

Commercial segment net sales were $143.3 million in the third quarter 2023, an increase of $32.3 million, or 29.1%, from $111.0 million in the third quarter 2022. The increase in net sales compared to the prior year quarter was primarily due to higher shipments of school buses, municipal transit buses, terminal trucks and street sweepers, and price realization, partially offset by an unfavorable mix of municipal transit buses. Increased shipments within the segment were primarily related to initiatives put in place designed to increase throughput, and an improved supply chain. Commercial segment backlog at the end of the third quarter 2023 was $507.7 million, a decrease of $23.0 million compared to $530.7 million at the end of the third quarter 2022. The decrease was primarily the result of lower orders for terminal trucks, street sweepers, and municipal transit buses, partially offset by strong orders for school buses, and pricing actions.

Commercial segment Adjusted EBITDA was $11.6 million in the third quarter 2023, an increase of $4.8 million, or 70.6%, from $6.8 million in the third quarter 2022. The increase was primarily the result of increased shipments of school buses, terminal trucks, and street sweepers, and price realization, partially offset by an unfavorable mix and supply chain challenges within municipal transit buses, and inflationary pressures.

Recreation Segment

Recreation segment net sales were $214.5 million in the third quarter 2023, a decrease of $39.6 million, or 15.6%, from $254.1 million in the third quarter 2022. The decrease in net sales compared to the prior year quarter was primarily due to decreased unit shipments, an unfavorable mix of motorized units, and increased discounting, partially offset by price realization. Recreation segment backlog at the end of the third quarter 2023 was $408.6 million, a decrease of $834.3 million compared to $1,242.9 million at the end of the third quarter 2022. The decrease was primarily the result of production against backlog, order cancellations, and lower order intake in certain product categories.

Recreation segment Adjusted EBITDA was $18.4 million in the third quarter 2023, a decrease of $11.4 million, or 38.3%, from $29.8 million in the third quarter 2022. The decrease was primarily due to lower unit shipments, unfavorable category mix, inflationary pressure, and increased discounting, partially offset by price realization.

Working Capital, Liquidity, and Capital Allocation

Cash and cash equivalents totaled $11.0 million as of July 31, 2023. Net debt2 was $168.0 million, and the company had $355.9 million available under its ABL revolving credit facility as of July 31, 2023, an increase of $48.2 million as compared to the October 31, 2022 availability of $307.7 million. Trade working capital3 for the company as of July 31, 2023 was $313.1 million, compared to $347.8 million as of October 31, 2022. The decrease was primarily due to a decrease in accounts receivable, increased accounts payable and increased customer advances, partially offset by an increase in inventory. Capital expenditures in the third quarter 2023 were $9.1 million compared to $7.4 million in the third quarter 2022.

_____________________

2 Net Debt is defined as total debt less cash and cash equivalents.

3 Trade Working Capital is defined as accounts receivable plus inventories less accounts payable and customer advances.

Updated Fiscal Year 2023 Outlook

 

 

Full Fiscal Year 2023

 

 

 

Updated Guidance

 

 

 

Prior Guidance

 

($ in millions)

 

Low

 

 

High

 

 

 

Low

 

 

High

 

Net Sales

 

$

2,550

 

 

$

2,600

 

 

 

$

2,450

 

 

$

2,550

 

Net Income

 

$

27

 

 

$

37

 

 

 

$

15

 

 

$

30

 

Adjusted EBITDA

 

$

135

 

 

$

145

 

 

 

$

120

 

 

$

135

 

Adjusted Net Income

 

$

63

 

 

$

73

 

 

 

$

48

 

 

$

62

 

Free Cash Flow⁴

 

$

70

 

 

$

75

 

 

 

$

43

 

 

$

56

 

Quarterly Dividend

The company’s board of directors declared a quarterly cash dividend in the amount of $0.05 per share of common stock, payable on October 13, 2023, to shareholders of record on September 29, 2023, which equates to a rate of $0.20 per share of common stock on an annualized basis.

Conference Call

A conference call to discuss the company’s fiscal year 2023 third quarter financial results is scheduled for September 13, 2023, at 10:00 a.m. ET. A supplemental slide deck will be available on the REV Group, Inc. investor relations website. The call will be webcast simultaneously over the Internet. To access the webcast, listeners can go to http://investors.revgroup.com/investor-events-and-presentations/events at least 15 minutes prior to the event and follow instructions for listening to the webcast. An audio replay of the call and related question and answer session will be available for 12 months at this website.

About REV Group

REV Group (REVG) companies are leading designers and manufacturers of specialty vehicles and related aftermarket parts and services. We serve a diversified customer base, primarily in the United States, through three segments: Fire & Emergency, Commercial, and Recreation. We provide customized vehicle solutions for applications, including essential needs for public services (ambulances, fire apparatus, school buses, and transit buses), commercial infrastructure (terminal trucks and industrial sweepers) and consumer leisure (recreational vehicles). Our diverse portfolio is made up of well-established principal vehicle brands, including many of the most recognizable names within their industry. Several of our brands pioneered their specialty vehicle product categories and date back more than 50 years. REV Group trades on the NYSE under the symbol REVG. Investors-REVG

_____________________

4 Free Cash Flow is defined as net cash from operating activities minus capital expenditures.

Note Regarding Non-GAAP Measures

The company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). However, management believes that the evaluation of our ongoing operating results may be enhanced by a presentation of Adjusted EBITDA and Adjusted Net Income, which are non-GAAP financial measures. Adjusted EBITDA represents net income before interest expense, income taxes, depreciation and amortization and loss on early extinguishment of debt as applicable, as adjusted for certain non-recurring, one-time and other adjustments which we believe are not indicative of our underlying operating performance. Adjusted Net Income represents net income as adjusted for certain after-tax, non-recurring, one-time and other adjustments, which we believe are not indicative of our underlying operating performance, as well as non-cash intangible asset amortization and stock-based compensation. Free Cash Flow is calculated as net cash from operating activities minus capital expenditures.

The company believes that the use of Adjusted EBITDA, Adjusted Net Income and Free Cash Flow provide additional meaningful methods of evaluating certain aspects of its operating performance from period to period on a basis that may not be otherwise apparent under GAAP when used in addition to, and not in lieu of, GAAP measures. A reconciliation of Adjusted EBITDA and Adjusted Net Income to the most closely comparable financial measures calculated in accordance with GAAP is included in the financial appendix of this news release.

Cautionary Statement About Forward-Looking Statements

This news release contains statements that the company believes to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. This news release includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, “forward-looking statements.” These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms “believes,” “estimates,” “anticipates,” “expects,” “strives,” “goal,” “seeks,” “projects,” “intends,” “forecasts,” “plans,” “may,” “will” or “should” or, in each case, their negative or other variations or comparable terminology. They appear in a number of places throughout this news release and include statements regarding our intentions, beliefs, goals or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industries in which we operate, including REV Group’s outlook for the full fiscal year 2023.

Our forward-looking statements are subject to risks and uncertainties, including those highlighted under “Risk Factors” and “Cautionary Statement on Forward-Looking Statements” in the company’s annual report on Form 10-K, and in the company’s subsequent quarterly reports on Form 10-Q, together with the company’s other filings with the SEC, which risks and uncertainties may cause actual results to differ materially from those projected or implied by the forward-looking statement. Forward-looking statements are based on current expectations and assumptions and currently available data and are neither predictions nor guarantees of future events or performance. You should not place undue reliance on forward-looking statements, which only speak as of the date hereof. The company does not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, expect as required by applicable law.

REV GROUP, INC. AND SUBSIDIARIES

CONDENSED UNAUDITED CONSOLIDATED BALANCE SHEETS

(In millions, except share amounts)

 

 

 

 

 

(Audited)

 

 

July 31,

2023

 

October 31,

2022

ASSETS

 

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

11.0

 

 

$

20.4

Accounts receivable, net

 

 

210.6

 

 

 

215.0

Inventories, net

 

 

644.0

 

 

 

629.5

Other current assets

 

 

41.4

 

 

 

23.5

Total current assets

 

 

907.0

 

 

 

888.4

Property, plant and equipment, net

 

 

152.6

 

 

 

148.9

Goodwill

 

 

157.3

 

 

 

157.3

Intangible assets, net

 

 

116.2

 

 

 

119.2

Right of use assets

 

 

38.0

 

 

 

20.2

Other long-term assets

 

 

8.4

 

 

 

10.6

Total assets

 

$

1,379.5

 

 

$

1,344.6

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

192.7

 

 

$

163.9

Short-term customer advances

 

 

236.6

 

 

 

258.0

Short-term accrued warranty

 

 

21.9

 

 

 

18.9

Short-term lease obligations

 

 

7.8

 

 

 

6.1

Other current liabilities

 

 

89.3

 

 

 

80.5

Total current liabilities

 

 

548.3

 

 

 

527.4

Long-term debt

 

 

179.0

 

 

 

230.0

Long-term customer advances

 

 

112.2

 

 

 

74.8

Deferred income taxes

 

 

18.6

 

 

 

21.0

Long-term lease obligations

 

 

30.4

 

 

 

14.2

Other long-term liabilities

 

 

22.4

 

 

 

20.9

Total liabilities

 

 

910.9

 

 

 

888.3

Commitments and contingencies

 

 

 

 

Shareholders' Equity:

 

 

 

 

Preferred stock ($.001 par value, 95,000,000 shares authorized; none issued or outstanding)

 

 

 

 

 

Common stock ($.001 par value, 605,000,000 shares authorized; 59,309,107

and 59,323,534 shares issued and outstanding, respectively)

 

 

0.1

 

 

 

0.1

Additional paid-in capital

 

 

442.7

 

 

 

436.4

Retained earnings

 

 

26.0

 

 

 

19.5

Accumulated other comprehensive (loss) income

 

 

(0.2

)

 

 

0.3

Total shareholders' equity

 

 

468.6

 

 

 

456.3

Total liabilities and shareholders' equity

 

$

1,379.5

 

 

$

1,344.6

REV GROUP, INC. AND SUBSIDIARIES

CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(In millions, except share and per share amounts)

 

 

 

Three Months Ended

July 31,

 

Nine Months Ended

July 31,

 

 

2023

 

2022

 

2023

 

2022

Net sales

 

$

680.0

 

$

594.8

 

$

1,944.7

 

$

1,708.1

Cost of sales

 

 

599.8

 

 

527.0

 

 

1,724.1

 

 

1,527.4

Gross profit

 

 

80.2

 

 

67.8

 

 

220.6

 

 

180.7

Operating expenses:

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

52.6

 

 

46.1

 

 

170.6

 

 

144.2

Research and development costs

 

 

1.3

 

 

0.9

 

 

3.5

 

 

2.9

Amortization of intangible assets

 

 

0.6

 

 

1.3

 

 

3.0

 

 

5.7

Restructuring costs

 

 

 

 

2.3

 

 

 

 

8.9

Total operating expenses

 

 

54.5

 

 

50.6

 

 

177.1

 

 

161.7

Operating income

 

 

25.7

 

 

17.2

 

 

43.5

 

 

19.0

Interest expense, net

 

 

7.3

 

 

4.3

 

 

21.9

 

 

11.2

Loss on investment in China JV

 

 

 

 

 

 

0.7

 

 

Loss on sale of business

 

 

 

 

 

 

1.1

 

 

0.1

Income before provision for income taxes

 

 

18.4

 

 

12.9

 

 

19.8

 

 

7.7

Provision for income taxes

 

 

3.5

 

 

3.4

 

 

4.2

 

 

1.2

Net income

 

$

14.9

 

$

9.5

 

$

15.6

 

$

6.5

 

 

 

 

 

 

 

 

 

Net income per common share:

 

 

 

 

 

 

 

 

Basic

 

$

0.25

 

$

0.16

 

$

0.27

 

$

0.11

Diluted

 

$

0.25

 

$

0.16

 

$

0.26

 

$

0.10

Dividends declared per common share

 

$

0.05

 

$

0.05

 

$

0.15

 

$

0.15

 

 

 

 

 

 

 

 

 

Adjusted net income per common share:

 

 

 

 

 

 

 

 

Basic

 

$

0.36

 

$

0.24

 

$

0.83

 

$

0.54

Diluted

 

$

0.35

 

$

0.24

 

$

0.83

 

$

0.53

 

 

 

 

 

 

 

 

 

Weighted Average Shares Outstanding:

 

 

 

 

 

 

 

 

Basic

 

 

58,730,037

 

 

59,417,336

 

 

58,588,712

 

 

61,291,966

Diluted

 

 

59,155,217

 

 

59,922,851

 

 

59,041,350

 

 

61,993,292

REV GROUP, INC. AND SUBSIDIARIES

CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

 

 

 

Nine Months Ended

July 31,

 

 

2023

 

2022

Cash flows from operating activities:

 

 

 

 

Net income

 

$

15.6

 

 

$

6.5

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

 

19.7

 

 

 

25.2

 

Amortization of debt issuance costs

 

 

1.2

 

 

 

1.3

 

Stock-based compensation expense

 

 

11.0

 

 

 

6.3

 

Deferred income taxes

 

 

(2.4

)

 

 

2.2

 

Gain on sale of assets

 

 

(0.5

)

 

 

(0.5

)

Loss on investment in China JV

 

 

0.7

 

 

 

 

Loss on sale of business

 

 

1.1

 

 

 

0.1

 

Changes in operating assets and liabilities, net

 

 

27.0

 

 

 

18.4

 

Net cash provided by operating activities

 

 

73.4

 

 

 

59.5

 

Cash flows from investing activities:

 

 

 

 

Purchase of property, plant and equipment

 

 

(19.7

)

 

 

(15.9

)

Proceeds from sale of assets

 

 

0.5

 

 

 

2.8

 

Proceeds from sale of China JV

 

 

0.6

 

 

 

1.8

 

Proceeds from sale of a business

 

 

0.6

 

 

 

 

Net cash used in investing activities

 

 

(18.0

)

 

 

(11.3

)

Cash flows from financing activities:

 

 

 

 

Net (payments) proceeds from borrowings on revolving credit facility

 

 

(51.0

)

 

 

35.0

 

Payment of dividends

 

 

(9.1

)

 

 

(9.4

)

Repurchase and retirement of common stock

 

 

 

 

 

(70.0

)

Other financing activities

 

 

(4.7

)

 

 

(2.3

)

Net cash used in financing activities

 

 

(64.8

)

 

 

(46.7

)

Net (decrease) increase in cash and cash equivalents

 

 

(9.4

)

 

 

1.5

 

Cash and cash equivalents, beginning of period

 

 

20.4

 

 

 

13.3

 

Cash and cash equivalents, end of period

 

$

11.0

 

 

$

14.8

 

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

 

 

Cash paid (received) for:

 

 

 

 

Interest

 

$

18.5

 

 

$

7.6

 

Income taxes, net of refunds

 

$

7.0

 

 

$

(15.1

)

REV GROUP, INC. AND SUBSIDIARIES

SEGMENT INFORMATION

(In millions; unaudited)

 

 

 

Three Months Ended July 31,

 

Nine Months Ended July 31,

 

 

2023

 

2022

 

2023

 

2022

Net Sales:

 

 

 

 

 

 

 

 

Fire & Emergency

 

$

322.9

 

 

$

230.1

 

 

$

835.3

 

 

$

712.5

 

Commercial

 

 

143.3

 

 

 

111.0

 

 

 

413.9

 

 

 

299.2

 

Recreation

 

 

214.5

 

 

 

254.1

 

 

 

697.1

 

 

 

697.7

 

Corporate & Other

 

 

(0.7

)

 

 

(0.4

)

 

 

(1.6

)

 

 

(1.3

)

Total

 

$

680.0

 

 

$

594.8

 

 

$

1,944.7

 

 

$

1,708.1

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA:

 

 

 

 

 

 

 

 

Fire & Emergency

 

$

18.1

 

 

$

1.0

 

 

$

25.6

 

 

$

0.6

 

Commercial

 

 

11.6

 

 

 

6.8

 

 

 

29.6

 

 

 

19.0

 

Recreation

 

 

18.4

 

 

 

29.8

 

 

 

71.9

 

 

 

75.6

 

Corporate & Other

 

 

(8.7

)

 

 

(8.1

)

 

 

(24.5

)

 

 

(23.6

)

Total

 

$

39.4

 

 

$

29.5

 

 

$

102.6

 

 

$

71.6

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA Margin:

 

 

 

 

 

 

 

 

Fire & Emergency

 

 

5.6

%

 

 

0.4

%

 

 

3.1

%

 

 

0.1

%

Commercial

 

 

8.1

%

 

 

6.1

%

 

 

7.2

%

 

 

6.4

%

Recreation

 

 

8.6

%

 

 

11.7

%

 

 

10.3

%

 

 

10.8

%

Total

 

 

5.8

%

 

 

5.0

%

 

 

5.3

%

 

 

4.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period-End Backlog:

 

July 31,

2023

 

April 30,

2023

 

January 31,

2023

 

July 31,

2022

Fire & Emergency

 

$

3,220.5

 

 

$

2,857.3

 

 

$

2,674.3

 

 

$

2,163.1

 

Commercial

 

 

507.7

 

 

 

501.2

 

 

 

497.7

 

 

 

530.7

 

Recreation

 

 

408.6

 

 

 

495.0

 

 

 

988.1

 

 

 

1,242.9

 

Total

 

$

4,136.8

 

 

$

3,853.5

 

 

$

4,160.1

 

 

$

3,936.7

 

REV GROUP, INC. AND SUBSIDIARIES

ADJUSTED EBITDA BY SEGMENT

(In millions; unaudited)

 

 

 

Three Months Ended July 31, 2023

 

 

Fire &

Emergency

 

Commercial

 

Recreation

 

Corporate & Other

 

Total

Net income (loss)

 

$

12.3

 

 

$

9.7

 

$

16.6

 

$

(23.7

)

 

$

14.9

Depreciation and amortization

 

 

3.2

 

 

 

0.8

 

 

1.7

 

 

0.6

 

 

 

6.3

Interest expense, net

 

 

2.2

 

 

 

0.3

 

 

0.1

 

 

4.7

 

 

 

7.3

Provision for income taxes

 

 

 

 

 

 

 

 

 

3.5

 

 

 

3.5

EBITDA

 

 

17.7

 

 

 

10.8

 

 

18.4

 

 

(14.9

)

 

 

32.0

Transaction expenses

 

 

 

 

 

 

 

 

 

0.1

 

 

 

0.1

Restructuring related charges

 

 

0.4

 

 

 

 

 

 

 

1.5

 

 

 

1.9

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

3.5

 

 

 

3.5

Legal matters

 

 

 

 

 

 

 

 

 

1.1

 

 

 

1.1

Other items

 

 

 

 

 

0.8

 

 

 

 

 

 

 

0.8

Adjusted EBITDA

 

$

18.1

 

 

$

11.6

 

$

18.4

 

$

(8.7

)

 

$

39.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended July 31, 2022

 

 

Fire &

Emergency

 

Commercial

 

Recreation

 

Corporate & Other

 

Total

Net (loss) income

 

$

(5.9

)

 

$

6.0

 

$

26.3

 

$

(16.9

)

 

 

9.5

Depreciation and amortization

 

 

2.8

 

 

 

0.7

 

 

2.8

 

 

0.6

 

 

 

6.9

Interest expense, net

 

 

1.7

 

 

 

0.1

 

 

 

 

2.5

 

 

 

4.3

Provision for income taxes

 

 

 

 

 

 

 

 

 

3.4

 

 

 

3.4

EBITDA

 

 

(1.4

)

 

 

6.8

 

 

29.1

 

 

(10.4

)

 

 

24.1

Transaction expenses

 

 

 

 

 

 

 

 

 

0.1

 

 

 

0.1

Restructuring costs

 

 

2.3

 

 

 

 

 

 

 

 

 

 

2.3

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

1.8

 

 

 

1.8

Legal matters

 

 

0.1

 

 

 

 

 

0.7

 

 

0.4

 

 

 

1.2

Adjusted EBITDA

 

$

1.0

 

 

$

6.8

 

$

29.8

 

$

(8.1

)

 

$

29.5

REV GROUP, INC. AND SUBSIDIARIES

ADJUSTED EBITDA BY SEGMENT

(In millions; unaudited)

 

 

 

Nine Months Ended July 31, 2023

 

 

Fire &

Emergency

 

Commercial

 

Recreation

 

Corporate & Other

 

Total

Net income (loss)

 

$

4.0

 

 

$

25.5

 

$

64.9

 

$

(78.8

)

 

$

15.6

Depreciation & amortization

 

 

9.4

 

 

 

2.3

 

 

6.3

 

 

1.7

 

 

 

19.7

Interest expense, net

 

 

6.3

 

 

 

1.0

 

 

0.2

 

 

14.4

 

 

 

21.9

Provision for income taxes

 

 

 

 

 

 

 

 

 

4.2

 

 

 

4.2

EBITDA

 

 

19.7

 

 

 

28.8

 

 

71.4

 

 

(58.5

)

 

 

61.4

Transaction expenses

 

 

 

 

 

 

 

 

 

0.5

 

 

 

0.5

Sponsor expense reimbursement

 

 

 

 

 

 

 

 

 

0.2

 

 

 

0.2

Restructuring related charges

 

 

4.1

 

 

 

 

 

 

 

6.4

 

 

 

10.5

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

11.0

 

 

 

11.0

Legal matters

 

 

0.9

 

 

 

 

 

0.5

 

 

15.2

 

 

 

16.6

Loss on sale of business

 

 

1.1

 

 

 

 

 

 

 

 

 

 

1.1

Other items

 

 

(0.2

)

 

 

0.8

 

 

 

 

0.7

 

 

 

1.3

Adjusted EBITDA

 

$

25.6

 

 

$

29.6

 

$

71.9

 

$

(24.5

)

 

$

102.6

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended July 31, 2022

 

 

Fire &

Emergency

 

Commercial

 

Recreation

 

Corporate & Other

 

Total

Net (loss) income

 

$

(32.9

)

 

$

16.6

 

$

64.8

 

$

(42.0

)

 

$

6.5

Depreciation & amortization

 

 

11.2

 

 

 

2.2

 

 

10.1

 

 

1.7

 

 

 

25.2

Interest expense, net

 

 

4.9

 

 

 

0.2

 

 

 

 

6.1

 

 

 

11.2

Benefit for income taxes

 

 

 

 

 

 

 

 

 

1.2

 

 

 

1.2

EBITDA

 

 

(16.8

)

 

 

19.0

 

 

74.9

 

 

(33.0

)

 

 

44.1

Transaction expenses

 

 

 

 

 

 

 

 

 

0.6

 

 

 

0.6

Sponsor expense reimbursement

 

 

 

 

 

 

 

 

 

0.1

 

 

 

0.1

Restructuring costs

 

 

8.8

 

 

 

 

 

 

 

0.1

 

 

 

8.9

Restructuring related charges

 

 

5.1

 

 

 

 

 

 

 

 

 

 

5.1

Stock-based compensation expense

 

 

 

 

 

 

 

 

 

6.3

 

 

 

6.3

Legal matters

 

 

3.4

 

 

 

 

 

0.7

 

 

2.3

 

 

 

6.4

Loss on sale of business

 

 

0.1

 

 

 

 

 

 

 

 

 

 

0.1

Adjusted EBITDA

 

$

0.6

 

 

$

19.0

 

$

75.6

 

$

(23.6

)

 

$

71.6

REV GROUP, INC. AND SUBSIDIARIES

ADJUSTED NET INCOME

(In millions; unaudited)

 

 

 

Three Months Ended

July 31,

 

Nine Months Ended

July 31,

 

 

2023

 

2022

 

2023

 

2022

Net income

 

$

14.9

 

 

$

9.5

 

 

$

15.6

 

 

$

6.5

 

Amortization of intangible assets

 

 

0.6

 

 

 

1.3

 

 

 

3.0

 

 

 

5.7

 

Transaction expenses

 

 

0.1

 

 

 

0.1

 

 

 

0.5

 

 

 

0.6

 

Sponsor expense reimbursement

 

 

 

 

 

 

 

 

0.2

 

 

 

0.1

 

Restructuring costs

 

 

 

 

 

2.3

 

 

 

 

 

 

8.9

 

Restructuring related charges

 

 

1.9

 

 

 

 

 

 

10.5

 

 

 

5.1

 

Stock-based compensation expense

 

 

3.5

 

 

 

1.8

 

 

 

11.0

 

 

 

6.3

 

Legal matters

 

 

1.1

 

 

 

1.2

 

 

 

16.6

 

 

 

6.4

 

Loss on sale of business

 

 

 

 

 

 

 

 

1.1

 

 

 

0.1

 

Other items

 

 

0.8

 

 

 

 

 

 

1.3

 

 

 

 

Accelerated depreciation on certain property, plant, and equipment

 

 

 

 

 

 

 

 

 

 

 

2.3

 

Income tax effect of adjustments

 

 

(2.0

)

 

 

(1.9

)

 

 

(11.0

)

 

 

(9.1

)

Adjusted Net Income

 

$

20.9

 

 

$

14.3

 

 

$

48.8

 

 

$

32.9

 

REV GROUP, INC. AND SUBSIDIARIES

ADJUSTED EBITDA OUTLOOK RECONCILIATION

(In millions)

 

 

 

Fiscal Year 2023

 

 

Low

 

High

Net income (5)

 

$

26.5

 

$

37.2

Depreciation and amortization

 

 

26.5

 

 

25.5

Interest expense, net

 

 

29.0

 

 

27.0

Provision for income taxes

 

 

8.1

 

 

11.4

EBITDA

 

 

90.1

 

 

101.1

Sponsor expense reimbursement

 

 

0.4

 

 

0.4

Transaction expense

 

 

0.5

 

 

0.5

Restructuring related charges

 

 

10.5

 

 

10.5

Stock-based compensation expense

 

 

14.5

 

 

13.5

Legal matters

 

 

16.6

 

 

16.6

Loss on sale of business

 

 

1.1

 

 

1.1

Other items

 

 

1.3

 

 

1.3

Adjusted EBITDA

 

$

135.0

 

$

145.0

REV GROUP, INC. AND SUBSIDIARIES

ADJUSTED NET INCOME OUTLOOK RECONCILIATION

(In millions)

 

 

 

Fiscal Year 2023

 

 

Low

 

High

Net income (5)

 

$

26.5

 

 

$

37.2

 

Amortization of intangible assets

 

 

3.5

 

 

 

3.5

 

Transaction expenses

 

 

0.5

 

 

 

0.5

 

Sponsor expense reimbursement

 

 

0.4

 

 

 

0.4

 

Restructuring related charges

 

 

10.5

 

 

 

10.5

 

Stock-based compensation expense

 

 

14.5

 

 

 

13.5

 

Legal matters

 

 

16.6

 

 

 

16.6

 

Loss on sale of business

 

 

1.1

 

 

 

1.1

 

Other items

 

 

1.3

 

 

 

1.3

 

Income tax effect of adjustments

 

 

(11.4

)

 

 

(11.1

)

Adjusted Net Income

 

$

63.5

 

 

$

73.4

 

_____________________

5 Does not include any non-recurring charges that may occur during the period shown other than those presented in this reconciliation. See “Cautionary Statement About Forward-Looking Statements” above

 

Contacts

Drew Konop

VP, Investor Relations & Corporate FP&A

Email: investors@revgroup.com

Phone: 1-888-738-4037 (1-888-REVG-037)

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