ALAMO GROUP ANNOUNCES RECORD 2023 FOURTH QUARTER AND YEAR END RESULTS
Highlights
- Ninth consecutive quarterly record for sales and earnings
-
Fourth quarter net sales of
$417.5 million , up 8% -
Fourth quarter operating income of
$44.8 million , up 5% -
Fourth quarter net income of
$31.5 million , or$2.63 per diluted share, up 8% -
Full year net sales of
$1.69 billion , up 12% -
Full year operating income of
$198.0 million , up 33% -
Full year net income of
$136.2 million , up 34% -
Full year diluted EPS was
$11.36 , up 33% -
Record EBITDA of
$246.6 million , up 26% -
Year-end 2023 backlog at
$860 million
Fourth Quarter Results
Fourth quarter 2023 net sales were
Full Year Results
Full year 2023 net sales increased to almost
Comments on Results
"It was great to see that our fourth quarter gross margin expanded by 80 basis points reflecting the durable quality of our backlog. Improvements in supply chain performance and labor availability drove operating efficiency higher and contributed to the favorable gross margin. The combined benefits of the higher gross margin and better operating efficiency were partially offset by higher employee-related administrative expenses during the quarter. Fourth quarter operating income of
"The Industrial Equipment Division had a very strong fourth quarter with sales that were 32% higher than the fourth quarter of 2022. Governmental and industrial demand for this Division's products remained robust although order bookings were 9% lower due to a challenging comparable caused by an unusually large snow-removal equipment order that we received in the fourth quarter of 2022. Year-end backlog increased by 18% compared to 2022.
"
"The Company's solid performance in the fourth quarter capped a very strong performance in 2023. Full-year sales were up 12% and net income improved by 34% versus the prior year. As we expected, recent softness in several of the
Earnings Conference Call
The Company will host a conference call to discuss fourth quarter and year end 2023 financial results on
Individuals wishing to participate in the conference call should dial 877-317-6789 (domestic) or 412-317-6789 (international). For interested individuals unable to join the call, a replay will be available until
The live broadcast of
About
Forward Looking Statements
This release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially from forecasted results. Among those factors which could cause actual results to differ materially are the following:
adverse economic conditions which could lead to a reduction in overall market demand, supply chain disruptions, labor constraints, increasing costs due to inflation, disease outbreaks, geopolitical risks, including effects of the war in the
(Tables Follow)
# # #
(1) This is a non-GAAP financial measure or other information relating to our GAAP financial measures that we have provided to investors in order to allow greater transparency and a deeper understanding of our financial condition and operating results. For a reconciliation of the non-GAAP financial measure or for a more detailed explanation of financial results, refer to "Non-GAAP Financial Measure Reconciliation" below and the Attachments thereto.
Condensed Consolidated Balance Sheets (in thousands) (Unaudited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ 51,919 |
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$ 47,016 |
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Accounts receivable, net |
|
362,007 |
|
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317,581 |
|
Inventories |
|
377,480 |
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352,553 |
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Other current assets |
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12,551 |
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10,060 |
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Total current assets |
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803,957 |
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727,210 |
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Rental equipment, net |
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39,264 |
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33,723 |
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Property, plant and equipment |
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166,660 |
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155,007 |
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206,536 |
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195,858 |
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Intangible assets |
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168,296 |
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171,341 |
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Other non-current assets |
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24,673 |
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25,369 |
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Total assets |
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$ 1,409,386 |
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$ 1,308,508 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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Current liabilities: |
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Trade accounts payable |
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$ 99,678 |
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$ 97,537 |
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Income taxes payable |
|
12,529 |
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|
6,592 |
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Accrued liabilities |
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86,711 |
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71,368 |
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Current maturities of long-term debt and finance lease obligations |
|
15,008 |
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|
15,009 |
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Total current liabilities |
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213,926 |
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190,506 |
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Long-term debt, net of current maturities |
|
220,269 |
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286,943 |
|
Long term tax payable |
|
2,634 |
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|
3,781 |
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Other long-term liabilities |
|
23,694 |
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23,668 |
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Deferred income taxes |
|
16,100 |
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18,250 |
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Total stockholders' equity |
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932,763 |
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785,360 |
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Total liabilities and stockholders' equity |
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$ 1,409,386 |
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$ 1,308,508 |
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Alamo Group Inc. and Subsidiaries Condensed Consolidated Statements of Income (in thousands, except per share amounts) (Unaudited) |
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Fourth Quarter Ended |
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Year Ended |
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Net sales: |
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Vegetation Management |
$ 214,357 |
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$ 232,545 |
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$ 979,040 |
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$ 937,065 |
Industrial Equipment |
203,185 |
|
154,059 |
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710,611 |
|
576,551 |
Total |
417,542 |
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386,604 |
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1,689,651 |
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1,513,616 |
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Cost of Sales |
308,622 |
|
288,809 |
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1,236,007 |
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1,137,098 |
Gross Margin |
108,920 |
|
97,795 |
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453,644 |
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376,518 |
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26.1 % |
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25.3 % |
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26.8 % |
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24.9 % |
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Selling, general and administration expense |
60,068 |
|
51,282 |
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240,158 |
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212,649 |
Amortization Expense |
4,054 |
|
3,796 |
|
15,519 |
|
15,277 |
Income from Operations |
44,798 |
|
42,717 |
|
197,967 |
|
148,592 |
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10.7 % |
|
11.0 % |
|
11.7 % |
|
9.8 % |
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Interest Expense |
(6,587) |
|
(4,791) |
|
(26,093) |
|
(14,361) |
Interest Income |
360 |
|
530 |
|
1,485 |
|
752 |
Other Income |
1,667 |
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(200) |
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1,761 |
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(673) |
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Income before income taxes |
40,238 |
|
38,256 |
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175,120 |
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134,310 |
Provision for income taxes |
8,715 |
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9,091 |
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38,959 |
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32,382 |
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Net Income |
$ 31,523 |
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$ 29,165 |
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$ 136,161 |
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$ 101,928 |
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Net Income per common share: |
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Basic |
$ 2.64 |
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$ 2.45 |
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$ 11.42 |
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$ 8.58 |
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Diluted |
$ 2.63 |
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$ 2.44 |
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$ 11.36 |
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$ 8.54 |
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Average common shares: |
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Basic |
11,930 |
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11,884 |
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11,920 |
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11,877 |
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Diluted |
12,000 |
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11,940 |
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11,987 |
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11,934 |
Non-GAAP Financial Measures Reconciliation
From time to time,
Attachment 1 discloses a non-GAAP financial presentation related to the impact of currency translation on net sales by division. Attachment 2 shows the net change in our total debt net of cash and earnings before interest, taxes, depreciation and amortization ("EBITDA") which is a non-GAAP financial measure. The Company considers this information useful to investors to allow better comparability of period-to-period operating performance. Attachment 3 reflects Division performance inclusive of non-GAAP financial measures such as backlog and earnings before interest, tax, depreciation and amortization ("EBITDA").
Attachment 1 |
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Non-GAAP Financial Reconciliation (in thousands) (Unaudited) |
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Impact of Currency Translation on |
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Three Months Ended
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Change due to currency |
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2023 |
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2022 |
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% change |
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$ |
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% |
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Vegetation Management |
$ 214,357 |
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$ 232,545 |
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(7.8) % |
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$ 2,384 |
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1.0 % |
Industrial Equipment |
203,185 |
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154,059 |
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31.9 % |
|
861 |
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0.6 % |
Total |
$ 417,542 |
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$ 386,604 |
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8.0 % |
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$ 3,245 |
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0.8 % |
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Twelve Months Ended |
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Change due to currency |
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2023 |
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2022 |
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% change |
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$ |
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% |
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Vegetation Management |
$ 979,040 |
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$ 937,065 |
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4.5 % |
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$ 1,663 |
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0.2 % |
Industrial Equipment |
710,611 |
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576,551 |
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23.3 % |
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(1,961) |
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(0.3) % |
Total |
$ 1,689,651 |
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$ 1,513,616 |
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11.6 % |
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$ (298) |
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— % |
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Attachment 2 |
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Non-GAAP Financial Reconciliation (in thousands) (Unaudited) |
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Consolidated Net Change of Total Debt, Net of Cash |
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Net Change |
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Current maturities |
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$ 15,008 |
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$ 15,009 |
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Long-term debt, net of current |
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220,269 |
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286,943 |
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Total Debt |
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$ 235,277 |
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$ 301,952 |
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Total Cash |
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51,919 |
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47,016 |
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Total Debt Net of Cash |
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$ 183,358 |
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$ 254,936 |
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$ 71,578 |
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EBITDA |
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Twelve Months Ended |
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Income from operations |
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$ 197,967 |
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$ 148,592 |
Depreciation |
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32,454 |
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31,412 |
Amortization |
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16,222 |
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15,944 |
EBITDA |
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$ 246,643 |
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$ 195,948 |
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Attachment 3 |
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Non-GAAP Financial Reconciliation (in thousands) (Unaudited) |
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Vegetation Management Division Performance |
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Three Months Ended
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Twelve Months Ended |
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2023 |
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2022 |
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2023 |
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2022 |
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Backlog |
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$ 352,080 |
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$ 577,050 |
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214,357 |
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232,545 |
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979,040 |
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937,065 |
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Income from Operations |
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19,764 |
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30,247 |
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122,084 |
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108,508 |
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9.2 % |
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13.0 % |
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12.5 % |
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11.6 % |
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Depreciation |
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4,246 |
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4,470 |
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15,581 |
|
15,188 |
Amortization |
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3,031 |
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3,005 |
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12,155 |
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12,193 |
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EBITDA |
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27,041 |
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37,722 |
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149,820 |
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135,889 |
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12.6 % |
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16.2 % |
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15.3 % |
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14.5 % |
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Industrial Equipment Division Performance |
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Three Months Ended
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Twelve Months Ended |
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2023 |
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2022 |
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2023 |
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2022 |
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Backlog |
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$ 507,715 |
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$ 429,439 |
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|
|
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|
203,185 |
|
154,059 |
|
710,611 |
|
576,551 |
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Income from Operations |
|
25,034 |
|
12,470 |
|
75,883 |
|
40,084 |
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12.3 % |
|
8.1 % |
|
10.7 % |
|
7.0 % |
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Depreciation |
|
4,534 |
|
4,970 |
|
16,873 |
|
16,224 |
Amortization |
|
1,199 |
|
958 |
|
4,067 |
|
3,751 |
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EBITDA |
|
30,767 |
|
18,398 |
|
96,823 |
|
60,059 |
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15.1 % |
|
11.9 % |
|
13.6 % |
|
10.4 % |
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