Q2 2024 REV Group Inc Earnings Call Transcript
Key Points
- REV Group Inc (REVG) reported a robust $4.3 billion backlog, indicating strong future demand.
- The fire and emergency segment achieved a five-and-a-half-year high in adjusted EBITDA margin, with margins improving 320 basis points versus the prior quarter and 480 basis points versus the prior year.
- The company successfully integrated the Spartan businesses, doubling production at the Spartan chassis plant since its acquisition in 2020.
- The sale of Collins Bus provided $308 million in cash proceeds, which were returned to shareholders through share repurchases and dividends.
- The company has taken significant cost actions to manage market dynamics, particularly in the recreational vehicle segment, which is expected to improve adjusted EBITDA margins by approximately 100 basis points in the second half of the year.
- Consolidated net sales decreased by $64 million compared to the second quarter last year, primarily due to lower sales in the recreational vehicle segment and fewer sales of terminal trucks.
- The recreational vehicle segment continues to face depressed industry demand, with new motorized wholesale unit shipments down 22% year over year.
- Terminal truck sales were 59% lower than the previous year, contributing to a $150 million revenue headwind year-over-year.
- The company divested its direct fire and ambulance sales and customer service operation in Florida, which may impact future sales in that region.
- Adjusted EBITDA for the recreational vehicle segment decreased by 58% year-over-year, primarily due to lower unit volume, inflationary pressures, and increased discounting.
Greetings. Welcome to REV Group Inc.'s Fiscal second-quarter 2024 earnings conference call. (Operator Instructions) Please note this conference is being recorded.
I will now turn the conference over to Drew Konop, Vice President, Investor Relations. Thank you. You may begin.
Good morning, and thanks for joining us. Earlier today, we issued our second quarter fiscal 2024 results. A copy of the release is available on our website at investors.revgroup.com.
Today's call is being webcast, and a slide presentation, which includes a reconciliation of non-GAAP to GAAP financial measures, is available on our website. Please refer now to slide two of that presentation.
Our remarks and answers will include forward-looking statements, which are subject to risk, that could cause actual results to differ from those expressed or implied by such forward-looking statements. These risks include, among others, matters that we've described in our Form 8-K filed
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