Third Quarter Financial Highlights:
(comparisons are year over year)
- Net revenues increased 33.7% year over year to $295.0
million
- Construction and Material Handling revenue of $184.7 million
and $110.3 million, respectively
- Product Support gross profit increased $5.7 million year over
year to $38.9 million
- Net loss of $(0.5) million available to common shareholders
compared to income of $0.3 million in prior year
- Adjusted net income per share* basic and diluted $0.02 compared
to a loss of $(0.10) in prior year
- Adjusted EBITDA* grew 43.4% to $31.4 million compared to $21.9
million in Q3 2020
- Company revises full year 2021 Adjusted EBITDA guidance to a
range of $113 million to $116 million
Alta Equipment Group Inc. (“Alta” or the “company”) (NYSE:
ALTG), a leading provider of premium material handling and
construction equipment and related services, today announced
financial results for the third quarter ended September 30,
2021.
CEO Comment: Ryan Greenawalt, Chief Executive Officer of
Alta, said “Our operating performance in the third quarter reflects
our flexible business model and our ability to produce strong
financial results in a supply constrained market. Both our
Construction and Material Handling business segments delivered year
over year revenue growth leading to a 43.4% increase in adjusted
EBITDA. Our high level of new and used equipment sales in the first
three quarters of the year are expected to continue to drive future
high-margin product support revenue.”
Mr. Greenawalt, concluded, “We continue to see significant
customer demand across all our business segments and anticipate
finishing the year on a high note. The growth in our core markets
combined with our expanded capabilities in our material handling
business, our entry into the electric vehicle market, and our
recent acquisitions have positioned us well for future
success.”
Three Months Ended
September 30,
Increase
(Decrease)
Nine Months Ended
September 30,
Increase
(Decrease)
2021
2020
2021 versus 2020
2021
2020
2021 versus 2020
Revenues:
New and used equipment sales
$
136.8
$
97.9
$
38.9
39.7
%
$
392.6
$
275.2
$
117.4
42.7
%
Parts sales
44.8
35.5
9.3
26.2
%
130.3
92.3
38.0
41.2
%
Service revenue
41.9
35.5
6.4
18.0
%
123.0
94.1
28.9
30.7
%
Rental revenue
41.7
32.2
9.5
29.5
%
113.0
83.4
29.6
35.5
%
Rental equipment sales
29.8
19.5
10.3
52.8
%
97.6
48.2
49.4
102.5
%
Net revenue
$
295.0
$
220.6
$
74.4
33.7
%
$
856.5
$
593.2
$
263.3
44.4
%
Cost of revenues:
New and used equipment sales
114.3
84.4
29.9
35.4
%
333.3
240.3
93.0
38.7
%
Parts sales
30.5
24.3
6.2
25.5
%
89.8
63.3
26.5
41.9
%
Service revenue
17.3
13.5
3.8
28.1
%
48.2
35.9
12.3
34.3
%
Rental revenue
4.6
5.4
(0.8
)
(14.8
)%
15.3
14.8
0.5
3.4
%
Rental depreciation
22.2
19.2
3.0
15.6
%
62.9
47.1
15.8
33.5
%
Rental equipment sales
25.0
17.1
7.9
46.2
%
81.7
41.7
40.0
95.9
%
Cost of revenue
$
213.9
$
163.9
$
50.0
30.5
%
$
631.2
$
443.1
$
188.1
42.5
%
Gross profit
$
81.1
$
56.7
$
24.4
43.0
%
$
225.3
$
150.1
$
75.2
50.1
%
Total general and administrative
expenses
$
75.1
$
60.2
$
14.9
24.8
%
$
215.7
$
157.7
$
58.0
36.8
%
Income (loss) from operations
$
6.0
$
(3.5
)
$
9.5
(271.4
)%
$
9.6
$
(7.6
)
$
17.2
(226.3
)%
Total other (expense) income
$
(5.8
)
$
1.9
$
(7.7
)
(405.3
)%
$
(29.2
)
$
(16.6
)
$
(12.6
)
75.9
%
Income (loss) before taxes
$
0.2
$
(1.6
)
$
1.8
(112.5
)%
$
(19.6
)
$
(24.2
)
$
4.6
(19.0
)%
Income tax provision (benefit)
—
(1.9
)
1.9
(100.0
)%
0.5
(3.4
)
3.9
(114.7
)%
Net Income (loss)
$
0.2
$
0.3
$
(0.1
)
(33.3
)%
$
(20.1
)
$
(20.8
)
$
0.7
(3.4
)%
Preferred stock dividends
(0.7
)
—
(0.7
)
100.0
%
(1.8
)
—
(1.8
)
100.0
%
Net (loss) income available to common
shareholders
$
(0.5
)
$
0.3
$
(0.8
)
(266.7
)%
$
(21.9
)
$
(20.8
)
$
(1.1
)
5.3
%
Recent Business Highlights:
- During the quarter, Alta expanded its warehousing and logistics
capabilities in the material handling business with the acquisition
of Baron, an established provider of dock and door sales, service,
and installation that services customers in the greater New England
area.
- On October 1, closed the acquisition of Gibson Machinery, a
premium equipment distributor, based in Ohio. Gibson expands Alta’s
presence in the Midwest and adds several new original equipment
manufacturing partners while presenting an opportunity to expand
its service operations in the Midwest region.
Full Year Financial Guidance: The Company revised its
full year financial guidance and expects to report Adjusted EBITDA
between $113 million to $116 million, net of new equipment
floorplan interest, for the full year 2021.
Conference Call Information: Alta will discuss its Third
quarter 2021 results via live webcast and teleconference today at
5:00 p.m. Eastern Time. A live webcast of the call can be found on
the investor relations portion of the company's website at
https://Investors.altaequipment.com. For a live audio
teleconference, please dial (844) 543-5487 (domestic), or (825)
312-2330 (international), with conference ID # 5381428 to access
the conference call at least five minutes prior to the 5:00 p.m.
Eastern Time start time. Once connected with the operator, request
access to the Alta Equipment Group Third Quarter 2021 Earnings
Call.
A live replay of the call will also be available on the investor
relations portion of the company's website at
https://Investors.altaequipment.com. An audio replay will be
available between 8:00 p.m. Eastern Time, November 11, 2021, and
12:59 p.m. Eastern Time, November 26, 2021 by calling (800)
585-8367, or (416) 621-4642, with conference ID # 5381428.
Additionally, supplementary presentation slides will be
accessible on the “Investor Relations” section of the Company’s
website at https://Investors.altaequipment.com.
About Alta Equipment Group Inc. Alta owns and operates
one of the largest integrated equipment dealership platforms in the
U.S. Through its branch network, the Company sells, rents, and
provides parts and service support for several categories of
specialized equipment, including lift trucks and aerial work
platforms, cranes, earthmoving equipment and other material
handling and construction equipment. Alta has operated as an
equipment dealership for 37 years and has developed a branch
network that includes over 55 total locations across Michigan,
Illinois, Indiana, New England, New York, Virginia, Florida and
Ohio. Alta offers its customers a one-stop-shop for their equipment
needs through its broad, industry leading product portfolio. More
information can be found at www.altg.com.
Forward Looking Statements This press release includes
“forward-looking statements” within the meaning of the “safe
harbor” provisions of the Private Securities Litigation Reform Act
of 1995. Alta’s actual results may differ from their expectations,
estimates and projections and consequently, you should not rely on
these forward-looking statements as predictions of future events.
Words such as “expect,” “estimate,” “project,” “budget,”
“forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,”
“should,” “believes,” “predicts,” “potential,” “continue,” and
similar expressions are intended to identify such forward-looking
statements. These forward-looking statements involve significant
risks and uncertainties that could cause the actual results to
differ materially from the expected results. Most of these factors
are outside Alta’s control and are difficult to predict. Factors
that may cause such differences include, but are not limited to:
the impact of the COVID-19 outbreak or future epidemics on our
business; federal, state, and local budget uncertainty, especially
as it relates to infrastructure projects; the performance and
financial viability of key suppliers, contractors, customers, and
financing sources; economic, industry, business and political
conditions including their effects on governmental policy and
government actions that disrupt our supply chain or sales channels;
our success in identifying acquisition targets and integrating
acquisitions; our success in expanding into and doing business in
additional markets; our ability to raise capital at favorable
terms; the competitive environment for our products and services;
our ability to continue to innovate and develop new business lines;
our ability to attract and retain key personnel, including, but not
limited to, skilled technicians; our ability to maintain our
listing on The New York Stock Exchange; the impact of cyber or
other security threats or other disruptions to our businesses; our
ability to realize the anticipated benefits of acquisitions or
divestitures, rental fleet investments or internal reorganizations;
and other risks and uncertainties identified in this presentation
or indicated from time to time in the section entitled “Risk
Factors” in Alta’s annual report on Form 10-K and other filings
with the U.S. Securities and Exchange Commission (the “SEC”). Alta
cautions that the foregoing list of factors is not exclusive, and
readers should not place undue reliance upon any forward-looking
statements, which speak only as of the date made. Alta does not
undertake or accept any obligation or undertaking to release
publicly any updates or revisions to any forward-looking statements
to reflect any change in its expectations or any change in events,
conditions, or circumstances on which any such statement is
based.
*Use of Non-GAAP Financial Measures To supplement our
consolidated financial statements, which are prepared and presented
in accordance with accounting principles generally accepted in the
United States (“GAAP”), we disclose non-GAAP financial measures,
including Adjusted EBITDA, Adjusted net income (loss), and Adjusted
basic and diluted net income (loss) per share, in this press
release because we believe they are useful performance measures
that assist in an effective evaluation of our operating performance
when compared to our peers, without regard to financing methods or
capital structure. We believe such measures are useful for
investors and others in understanding and evaluating our operating
results in the same manner as our management. However, such
measures are not financial measures calculated in accordance with
GAAP and should not be considered as a substitute for, or in
isolation from, net income (loss), revenue, operating profit, or
any other operating performance measures calculated in accordance
with GAAP.
We define Adjusted EBITDA as net income (loss) before interest
expense, income taxes, depreciation and amortization, adjustments
for certain one-time or non-recurring items and other adjustments.
We exclude these items from net income (loss) in arriving at
Adjusted EBITDA because these amounts are either non-recurring or
can vary substantially within the industry depending upon
accounting methods and book values of assets, capital structures
and the method by which the assets were acquired. Adjusted net
income (loss) is defined as net income (loss) adjusted to reflect
certain one-time or non-recurring items and other adjustments.
Adjusted basic and diluted earnings (loss) per share is defined as
adjusted net income (loss) divided by the weighted average number
of basic and diluted shares, respectively, outstanding during the
period. Certain items excluded from Adjusted EBITDA, Adjusted net
income (loss), Adjusted basic and diluted net income (loss) per
share are significant components in understanding and assessing a
company’s financial performance. For example, items such as a
company’s cost of capital and tax structure, certain one-time or
non-recurring items as well as the historic costs of depreciable
assets, are not reflected in Adjusted EBITDA or Adjusted net income
(loss). Our presentation of Adjusted EBITDA, Adjusted net income
(loss), Adjusted basic and diluted net income (loss) per share
should not be construed as an indication that results will be
unaffected by the items excluded from these metrics. Our
computation of Adjusted EBITDA, Adjusted net income (loss),
Adjusted basic and diluted net income (loss) per share may not be
identical to other similarly titled measures of other companies.
For a reconciliation of non-GAAP measures to their most comparable
measures under GAAP, please see the table entitled “Reconciliation
of Non-GAAP Financial Measures” at the end of this press
release.
ALTA EQUIPMENT GROUP INC. AND
SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(in millions, except share and per
share amounts)
September 30,
2021
December 31,
2020
ASSETS
CURRENT ASSETS
Cash
$
1.2
$
1.2
Accounts receivable, net of allowances of
$9.8 and $7.1 as of September 30, 2021 and December 31, 2020,
respectively
168.2
137.8
Inventories, net
204.9
229.0
Prepaid expenses and other current
assets
21.6
13.6
Total current assets
395.9
381.6
PROPERTY AND EQUIPMENT, NET
338.3
311.9
OTHER ASSETS
Goodwill
25.2
24.3
Intangible assets, net
26.2
26.3
Other assets
1.8
2.1
Total other assets
53.2
52.7
TOTAL ASSETS
$
787.4
$
746.2
LIABILITIES AND STOCKHOLDERS’
EQUITY
CURRENT LIABILITIES
Lines of credit, net
$
45.4
$
157.7
Floor plan payable – new equipment
105.0
127.6
Floor plan payable – used and rental
equipment
44.5
29.8
Current portion of long-term debt
0.6
8.7
Accounts payable
52.6
58.9
Customer deposits
14.9
9.3
Accrued expenses
41.2
30.1
Other current liabilities
20.3
12.2
Total current liabilities
324.5
434.3
LONG-TERM LIABILITIES
Long-term debt, net of current portion
309.7
135.0
Capital lease obligations, net of current
portion
0.2
0.6
Buyback residual obligations, net of
current portion
0.5
0.7
Lease liability, net of current
portion
1.9
2.5
Guaranteed purchase obligation, net of
current portion
5.2
6.9
Other liabilities
9.5
9.3
TOTAL LIABILITIES
$
651.5
$
589.3
CONTINGENCIES - NOTE 11
STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value,
1,000,000 shares authorized, 1,200,000 Depositary Shares
representing a 1/1000th fractional interest in a share of 10%
Series A Cumulative Perpetual Preferred Stock, $0.0001 par value
per share, issued and outstanding at September 30, 2021 and
December 31, 2020
$
—
$
—
Common stock, $0.0001 par value,
200,000,000 shares authorized; 32,363,376 issued and outstanding at
September 30, 2021, 30,018,502 issued and outstanding at December
31, 2020
—
—
Additional paid-in capital
217.1
216.2
Treasury stock
(5.9
)
(5.9
)
Accumulated deficit
(75.3
)
(53.4
)
TOTAL STOCKHOLDERS’ EQUITY
135.9
156.9
TOTAL LIABILITIES AND STOCKHOLDERS’
EQUITY
$
787.4
$
746.2
ALTA EQUIPMENT GROUP INC. AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
September 30,
Nine Months Ended
September 30,
(in millions, except share and per
share amounts)
2021
2020
2021
2020
Revenues:
New and used equipment sales
$
136.8
$
97.9
$
392.6
$
275.2
Parts sales
44.8
35.5
130.3
92.3
Service revenue
41.9
35.5
123.0
94.1
Rental revenue
41.7
32.2
113.0
83.4
Rental equipment sales
29.8
19.5
97.6
48.2
Net revenue
$
295.0
$
220.6
$
856.5
$
593.2
Cost of revenues:
New and used equipment sales
114.3
84.4
333.3
240.3
Parts sales
30.5
24.3
89.8
63.3
Service revenue
17.3
13.5
48.2
35.9
Rental revenue
4.6
5.4
15.3
14.8
Rental depreciation
22.2
19.2
62.9
47.1
Rental equipment sales
25.0
17.1
81.7
41.7
Cost of revenue
$
213.9
$
163.9
$
631.2
$
443.1
Gross profit
$
81.1
$
56.7
$
225.3
$
150.1
General and administrative expenses
72.9
58.4
209.4
153.2
Depreciation and amortization expense
2.2
1.8
6.3
4.5
Total general and administrative
expenses
75.1
60.2
215.7
157.7
Income (loss) from operations
$
6.0
$
(3.5
)
$
9.6
$
(7.6
)
Other income (expense)
Interest expense, floor plan payable – new
equipment
(0.4
)
(0.5
)
(1.4
)
(1.8
)
Interest expense – other
(5.6
)
(5.6
)
(16.2
)
(15.9
)
Other income
0.2
8.0
0.3
8.7
Loss on extinguishment of debt
—
—
(11.9
)
(7.6
)
Total other (expense) income
$
(5.8
)
$
1.9
$
(29.2
)
$
(16.6
)
Income (loss) before taxes
$
0.2
$
(1.6
)
$
(19.6
)
$
(24.2
)
Income tax provision (benefit)
—
(1.9
)
0.5
(3.4
)
Net Income (loss)
$
0.2
$
0.3
$
(20.1
)
$
(20.8
)
Preferred stock dividends
(0.7
)
—
(1.8
)
—
Net (loss) income available to common
shareholders
$
(0.5
)
$
0.3
$
(21.9
)
$
(20.8
)
Basic (loss) income per share
$
(0.02
)
$
0.01
$
(0.69
)
$
(0.81
)
Diluted (loss) income per share
$
(0.02
)
$
0.01
$
(0.69
)
$
(0.81
)
Basic weighted average common shares
outstanding
32,363,376
29,221,460
31,484,906
25,689,145
Diluted weighted average common shares
outstanding
32,363,376
29,310,674
31,484,906
25,689,145
CONSOLIDATED STATEMENTS OF CASH FLOWS
ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES
Nine Months Ended September
30,
(amounts in millions)
2021
2020
OPERATING ACTIVITIES
Net loss
$
(20.1
)
$
(20.8
)
Adjustments to reconcile net loss to net
cash flows provided by (used in) operating activities:
Depreciation and amortization
69.2
51.6
Amortization of debt discount and debt
issuance costs
1.3
1.2
Amortization of fair market rent
0.1
—
Imputed interest
0.2
—
Gain on sale of rental equipment
(15.9
)
(6.5
)
Inventory obsolescence
0.9
1.3
Provision for bad debt
3.4
2.8
Loss on debt extinguishment
11.9
7.6
Share based compensation
0.9
6.3
Changes in deferred rent
0.8
—
(Repayment) accrual of paid-in-kind
interest
—
(11.2
)
Changes in deferred taxes
0.5
(3.4
)
Changes in:
Accounts receivable
(33.0
)
6.2
Inventories
(116.0
)
(102.8
)
Proceeds from sale of rental equipment
97.6
48.2
Prepaid expenses and other assets
(8.3
)
(5.5
)
Proceeds from floor plans with
manufacturers
283.7
240.5
Payments under floor plans with
manufacturers
(289.6
)
(273.1
)
Accounts payable, accrued expenses,
customer deposits, and other current liabilities
17.8
15.9
Leases and other liabilities
(1.3
)
(3.1
)
Net cash provided by (used in)
operating activities
$
4.1
$
(44.8
)
INVESTING ACTIVITIES
Proceeds from the sale of assets
1.4
1.0
Expenditures for rental equipment
(30.9
)
(34.5
)
Expenditures for property and
equipment
(7.0
)
(4.0
)
Expenditures for acquisitions, net of cash
acquired
(3.9
)
(128.8
)
Net cash used in investing
activities
$
(40.4
)
$
(166.3
)
FINANCING ACTIVITIES
Expenditures for debt issuance costs
(1.5
)
(2.7
)
Extinguishment of floor plans and line of
credit
—
(132.9
)
Extinguishment of long-term debt
(153.1
)
(82.0
)
Redemption of former shareholder notes
payable
—
(6.7
)
Extinguishment of warrant liability
—
(29.6
)
Proceeds from lines of credit
242.5
334.5
Payments under lines of credit
(354.8
)
(187.1
)
Proceeds from floor plans with
unaffiliated source
72.8
63.5
Payments under floor plans with
unaffiliated source
(74.4
)
(61.3
)
Proceeds from issuance of long-term debt,
net
—
149.4
Proceeds from issuance of notes
310.2
—
Preferred dividends paid
(1.8
)
—
Payment of promissory note
(1.0
)
—
Payments on long-term debt
(1.9
)
(4.8
)
Payments on capital lease obligations
(0.7
)
(0.5
)
Equity proceeds from reverse
recapitalization, net
—
175.7
Proceeds from disgorgement of short swing
profits
—
1.6
Repurchases of common stock
—
(5.9
)
Net cash provided by financing
activities
$
36.3
$
211.2
NET CHANGE IN CASH
—
0.1
Cash, Beginning of year
1.2
—
Cash, End of period
$
1.2
$
0.1
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES
Three Months Ended
September 30,
Nine Months Ended
September 30,
(amounts in millions)
2021
2020
2021
2020
Net (loss) income
$
(0.5
)
$
0.3
$
(21.9
)
$
(20.8
)
Depreciation and amortization
24.4
21.0
69.2
51.6
Interest expense
6.0
6.1
17.6
17.7
Income tax provision (benefit)
—
(1.9
)
0.5
(3.4
)
EBITDA (1)
$
29.9
$
25.5
$
65.4
$
45.1
Transaction costs (2)
(0.1
)
1.2
1.0
3.9
Loan administration fees (3)
0.1
0.1
0.3
0.3
Non-cash adjustments (4)
0.2
0.3
0.7
0.7
Loss on debt extinguishment (5)
—
—
11.9
7.6
Share-based incentives (6)
0.4
3.2
0.9
9.8
Other expenses (7)
0.5
—
1.6
0.4
Insurance Proceeds (8)
—
(8.0
)
—
(8.0
)
Preferred stock dividend (9)
0.7
—
1.8
—
Showroom-Ready Equipment Interest Expense
(10)
(0.3
)
(0.4
)
(1.3
)
(1.4
)
Adjusted EBITDA (1)
$
31.4
$
21.9
$
82.3
$
58.4
Pro Forma EBITDA—Acquisitions (11)
0.1
3.1
0.4
15.0
Adjusted Pro Forma EBITDA (1)
$
31.5
$
25.0
$
82.7
$
73.4
Three Months Ended
September 30,
Nine Months Ended
September 30,
(amounts in millions)
2021
2020
2021
2020
Net (loss) income
$
(0.5
)
$
0.3
$
(21.9
)
$
(20.8
)
Transaction costs (2)
(0.1
)
1.2
1.0
3.9
Loan administration fees (3)
0.1
0.1
0.3
0.3
Non-cash adjustments (4)
0.2
0.3
0.7
0.7
Loss on debt extinguishment (5)
—
—
11.9
7.6
Share-based incentives (6)
0.4
3.2
0.9
9.8
Other expenses (7)
0.5
—
1.6
0.4
Insurance Proceeds (8)
—
(8.0
)
—
(8.0
)
Adjusted net income (loss) available to
common stockholders (1)
$
0.6
$
(2.9
)
$
(5.5
)
$
(6.1
)
Adjusted basic net income (loss) per
share (1)
$
0.02
$
(0.10
)
$
(0.17
)
$
(0.24
)
Adjusted diluted net income (loss) per
share (1)
$
0.02
$
(0.10
)
$
(0.17
)
$
(0.24
)
Basic weighted average common shares
outstanding
32,363,376
29,221,460
31,484,906
25,689,145
Diluted weighted average common shares
outstanding
32,520,401
29,221,460
31,484,906
25,689,145
(1) Represents Non-GAAP measure (2) Includes expenses related to
the acquisitions and capital raising activities and public company
preparation costs (3) Debt administration fees associated with debt
refinancing activities (4) Non-cash adjustments related to deferred
rent expenses (5) Represents expenses of debt extinguishments
related to refinancing activities of the business combination in
February 2020 and debt modification in Q2 2021 (6) Reflects
equity-based compensation expenses which includes February 2020
business combination related activities (7) Other expenses
primarily related to severance payments (8) Key-man life insurance
proceeds (9) Expenses related to preferred stock dividend payments
(10) Represents interest expense associated with showroom-ready new
and used equipment interest included in total interest expense
above (11) Pro forma EBITDA of acquisitions completed in 2020 and
forward, assuming each was acquired as of January 1, 2020
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211111006079/en/
Investors: Bob Jones / Taylor Krafchik Ellipsis
IR@altaequipment.com (646) 776-0886
Media: Glenn Moore Alta Equipment
glenn.moore@altaequipment.com (248) 305-2134
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