Q2 2024 NFI Group Inc Earnings Call Transcript
Key Points
- NFI Group Inc (NFYEF) reported significant year-over-year improvement in financial metrics, including double-digit growth in vehicle deliveries and revenue.
- The company achieved its first quarter of positive net earnings since 2021, with a nearly 400% increase in adjusted EBITDA.
- NFI's aftermarket segment delivered record performance, with $162 million in revenue and $35 million of adjusted EBITDA, both up 18% year over year.
- The backlog value increased to USD11.8 billion, reflecting a higher portion of zero-emission vehicles and pricing actions taken since mid-2022.
- NFI Group Inc (NFYEF) has made progress in managing working capital, resulting in positive free cash flow generation and a strong liquidity position.
- Supply chain challenges persist, particularly with components like seats and wiring harnesses for electric buses, which may continue through 2024.
- The company faces delays in certain component deliveries, impacting production schedules and requiring active management with suppliers.
- Despite improvements, the company still has to deal with legacy inflation-impacted contracts, which have affected margins.
- The ramp-up in production rates is being approached cautiously to avoid excessive offline buses and increased work-in-process inventory.
- The adoption of milestone payment structures in contracts is still in progress, with varying levels of success across different customers.
Good day, and thank you for standing by. Welcome to the NFI 2024 Q2 financial results conference call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your first speaker today, Stephen King, Vice President, Strategy, Investor Relations. Please go ahead.
Thank you, Sean. Good morning, everyone. Joining me today are Paul Soubry, President and Chief Executive Officer; and Brian Dewsnup, our Executive Vice President, Finance and Chief Financial Officer. On today's call, Paul and Brian will provide an update on our second-quarter results, including significant year-over-year improvement across our financial metrics and provide an update on the operating environment, market demand, and our outlook.
This call is being recorded, and a replay will be made available shortly. We will be using a presentation that can be found in the Investors section of our website. While we will be moving the slides via the webcast link,
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