HYSTER-YALE ANNOUNCES SECOND QUARTER 2024 RESULTS
Q2 2024 Consolidated Highlights:
- Continued consolidated revenue growth of more than 7% over Q2 2023
-
Operating profit of
$95.6 million , up 63% from Q2 2023, and ahead of expectations - Operating profit margin of 8.2%, up from 5.4% in Q2 2023
-
Net income of
$63.3 million , up 65%, from Q2 2023
|
Three Months Ended |
||||||||
($ in millions except per share amounts) |
|
|
|
|
% Change |
|
|
|
% Change |
Revenues |
|
|
|
|
7 % |
|
|
|
11 % |
Operating Profit |
|
|
|
|
63 % |
|
|
|
14 % |
Net Income |
|
|
|
|
65 % |
|
|
|
23 % |
Diluted Earnings per Share |
|
|
|
|
62 % |
|
|
|
22 % |
Effective
Lift Truck Business Results
Revenues by geographic segment were as follows:
($ in millions) |
Q2 2024 |
|
Q2 2023 |
|
% Change |
|
Q1 2024 |
|
% Change |
Revenues |
|
|
|
|
8 % |
|
|
|
11 % |
|
|
|
|
|
12 % |
|
|
|
15 % |
EMEA(1) |
|
|
|
|
(6) % |
|
|
|
(6) % |
JAPIC(1) |
|
|
|
|
(2) % |
|
|
|
29 % |
(1) The |
Lift Truck revenues were 8% higher than Q2 2023 due to higher average sales prices and the favorable impact of reduced dealer incentive programs. Improved
- Average lift truck sales prices increased 23% year-over-year largely due to carryover pricing from previously implemented price increases.
- Sales mix improved compared to prior year mainly due to increased sales of high-value options on Class 5 internal combustion engine trucks in the
Americas . - EMEA unit volume declined year-over-year primarily due to lower production rates as a result of reduced market demand compared to the prior year and lower backlog levels.
Gross profit and operating profit (loss) by geographic segment were as follows:
($ in millions) |
Q2 2024 |
|
Q2 2023 |
|
% Change |
|
Q1 2024 |
|
% Change |
Gross Profit |
|
|
|
|
35 % |
|
|
|
11 % |
|
|
|
|
|
41 % |
|
|
|
13 % |
EMEA |
|
|
|
|
20 % |
|
|
|
(4) % |
JAPIC |
|
|
|
|
(26) % |
|
|
|
33 % |
Operating Profit (Loss) |
|
|
|
|
65 % |
|
|
|
15 % |
|
|
|
|
|
60 % |
|
|
|
16 % |
EMEA |
|
|
|
|
336 % |
|
|
|
(8) % |
JAPIC |
|
|
|
|
(50) % |
|
|
|
4 % |
Q2 2024 operating profit increased 65% year-over-year, with operating profit margin moving higher by 320 basis points to 9.2%. This improvement was primarily due to higher unit margins. Increased operating expenses, including employee-related costs, partly offset this benefit.
- Globally, in Q2 2024 more units were sold at the latest and highest price increase levels than those sold in Q2 2023.
- Significant increase in product margins was led by a strong
Americas price-to-cost ratio. - Higher EMEA margins were primarily due to a mix shift to higher-priced/higher-margin Class 5 internal combustion engine trucks, including Big Trucks.
- Lower year-over-year JAPIC operating profit was primarily due to a mix shift to lower-margin trucks, reduced unit volumes and increased freight expense.
Bolzoni Results
($ in millions) |
Q2 2024 |
|
Q2 2023 |
|
% Change |
|
Q1 2024 |
|
% Change |
Revenues |
|
|
|
|
6 % |
|
|
|
6 % |
Gross Profit |
|
|
|
|
(1) % |
|
|
|
3 % |
Operating Profit |
|
|
|
|
(26) % |
|
|
|
21 % |
Nuvera Results
($ in millions) |
Q2 2024 |
|
Q2 2023 |
|
% Change |
|
Q1 2024 |
|
% Change |
Revenues |
|
|
|
|
(80) % |
|
|
|
(60) % |
Gross Profit (Loss) |
|
|
|
|
(39) % |
|
|
|
(9) % |
Operating Loss |
|
|
|
|
(25) % |
|
|
|
(22) % |
Nuvera remains focused on increasing its sales pipeline for 45kW and 60kW engines. The hydrogen fuel cell industry is facing slow customer adoption due to ongoing hydrogen supply constraints, and to delayed heavy-duty electric vehicle fuel cell product development programs. Despite a strong demonstration channel, these industry constraints have delayed Nuvera's bookings and reduced its overall engine shipments. As a result, Nuvera's Q2 2024 revenues decreased to
Income Tax Expense
Q2 2024's
Balance Sheet and Liquidity
($ in millions) |
|
|
|
|
% Change |
|
|
|
% Change |
Debt |
|
|
|
|
7 % |
|
|
|
(6) % |
Cash |
66.5 |
|
65.7 |
|
1 % |
|
62.2 |
|
7 % |
Net Debt |
|
|
|
|
9 % |
|
|
|
(6) % |
|
51 % |
|
64 % |
|
— |
|
53 % |
|
— |
The Company's financial leverage continued to improve in Q2 2024.
- Debt-to-total capital ratio of 51% improved 200 basis points from the
March 31, 2024 level primarily as a result of higher earnings. - Net debt improved by 9% compared to
June 30, 2023 , but increased compared toMarch 31, 2024 , as a result of higher debt levels required for working capital. - Unused borrowing capacity of
$217 million declined compared to$269 million as ofMarch 31, 2024 , primarily due to the higher debt level and lower available borrowing capacity due to the expiration of a temporary increase to the Company's asset-based lending facility initially secured in mid-2023.
The Company continues to focus on decreasing working capital, especially through inventory reductions.
- Inventory decreased 6% and 4% from Q1 2024 and Q2 2023 levels, respectively.
- Finished goods and raw materials inventories each decreased compared to Q1 2024.
- Working capital at
June 30, 2024 represented 18.3% of sales, improving from 18.5% at Q2 2023 and 18.7% at Q1 2024.
Outlook
Lift Truck Business
The Company is focused on delivering optimal solutions to its broad customer base, including lift trucks and advanced on-truck technologies, such as its innovative Operator Assist Systems (OAS). Together, these solutions provide customers with the right capabilities and functionality for their specific applications, while also increasing the unit sales value substantially. As a result of both Hyster-Yale's product line breadth and increasingly value-add technology solutions, per unit truck sales values can differ materially. Thus, aggregate unit data has become less meaningful. In this context, the Company will focus on total dollar values as its measure for bookings and backlog.
The Company estimates that the Q2 2024 global lift truck market was lower than prior year levels, with a significant decrease in the
Dollar-value Lift Truck bookings and backlog were as follows:
(In millions) |
Q2 2024 |
|
Q2 2023 |
% Change |
Q1 2024 |
% Change |
|||
Unit Bookings $ Value |
|
|
|
(44) % |
|
(27) % |
|||
Unit Backlog $ Value |
|
|
|
(29) % |
|
(16) % |
Consistent with these market factors, the Company's dollar-value factory bookings continued to decline quarter-over-quarter to
The
- Order cancellations by customers who no longer need previously placed orders due to lower than expected activity,
- Reduced lead times,
- Customer and dealer requests to delay shipments of current backlog orders to a time that better suits their needs, or
- Current retail bookings, orders placed through dealers with specific end-customer purchase orders, being fulfilled from existing, unshipped factory bookings or from current dealer stock levels.
Considering the Company's strong global backlog, including in the
The market situation in the EMEA and JAPIC segments is similar to the
The Company's current backlog should keep its global shipments generally in line with 2024 production expectations. However, certain lines, particularly in the JAPIC and EMEA lower value warehouse products, are expected to have lower shipments in the second half of 2024 compared to the first half. Global production levels may moderate in 2025 without market or share improvements above current expectations.
Over the past 18 months, the Company has benefited from strong pricing tailwinds and a significant order backlog, which led to product margins above the Company's targeted levels. Looking ahead, the Company is focused on maintaining competitively priced products at or above targeted margin levels. The Company expects to achieve its targeted booking margins through a combination of new model introductions, cost decreases and ongoing pricing discipline.
The combination of rising market share and new bookings, along with the seasonally lower Q3 production levels and the Company's
In this context, the Company expects continued year-over-year revenue growth and strong product margins in the second half of 2024 as higher-priced, higher-margin backlog units are shipped. Material and freight cost inflation is expected to somewhat temper the favorable second-half price-to-cost ratio. The combination of these factors and higher operating expenses are expected to reduce second-half operating profit modestly compared with the prior year. The Company is closely monitoring the effects of freight and material cost inflation and a weaker U.S. market and will quickly take any additional cost containment actions needed to help offset the negative impacts. Specifically, in Q3 2024, revenues are expected to increase compared to the prior year, while operating profit is expected to be comparable. Sequentially, third-quarter revenues and operating profit are expected to decrease from the strong second-quarter results due to normal business seasonality and modest impacts from freight cost inflation.
Nuvera
Nuvera remains focused on increasing customer product demonstrations and customer orders in second-half 2024. Shipments are expected to increase in the second half of the year, specifically Q4 2024, compared to second-half 2023, due to current customer orders and anticipated orders for Nuvera's new portable generator, which was introduced in
Consolidated
Full-year 2024 results are expected to improve compared to the Company's prior outlook due to better-than-expected second quarter results and anticipated further financial improvements in the second half of the year. Second-half revenues should increase while operating profit is likely to moderate slightly compared to the same 2023 period. The Company expects lower interest and tax expense in the second half, year-over-year. As a result, second-half 2024 net income is anticipated to be generally comparable to strong prior year levels, with a modest third-quarter decline expected to be offset by a fourth-quarter improvement. The Company's effective tax rate is anticipated to be modestly higher than 2023, largely due to the capitalization of research and development expenses, but lower than previously anticipated due to a higher
For the twelve-month period ended
The Company continues to focus on reducing its financial leverage and improving its cash flows and expects further inventory reductions to decrease working capital. Capital expenditures are expected to be
Long-Term Objectives
Hyster-Yale's vision is to transform the way the world moves materials from Port to Home. It strives to do this through two customer promises: providing optimized product solutions and exceptional customer care. Ongoing execution of established strategic initiatives and key projects are expected to help the Company fulfill these promises and achieve long-term revenue and operating profit growth rates above the material handling market's expected growth rates. The Company believes these actions will contribute to an increased and sustainable lift truck and attachment competitive advantage over time. In addition, the Company believes that Nuvera's revenues will increase significantly over future years, bringing additional value to Hyster-Yale's shareholders.
Further information regarding the Company's strategic initiatives can be found in the Company's Q2 2024 Investor Deck. This presentation, currently available on the Hyster-Yale website, elaborates on the strategies that are critical for Hyster-Yale's long-term prospects. The Company encourages investors to review this material to ensure a clear understanding of Hyster-Yale's future direction.
*****
Conference Call
The management of
Non-GAAP and Other Measures
This release contains non-GAAP financial measures. Included in this release are reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with
EBITDA in this release is provided solely as supplemental non-GAAP disclosures of operating results. EBITDA does not represent operating profit (loss) or net income (loss), as defined by GAAP, and should not be considered as a substitute for operating profit (loss) or net income (loss). Hyster-Yale defines EBITDA as income (loss) before income taxes and noncontrolling interests plus net interest expense and depreciation and amortization expense. EBITDA is not a measurement under GAAP and is not necessarily comparable with similarly titled measures of other companies. Management believes that EBITDA assists investors in understanding the results of operations of the Company. In addition, management evaluates results using EBITDA.
For purposes of this release, discussions about net income (loss) refer to net income (loss) attributable to stockholders.
Forward-looking Statements Disclaimer
The statements contained in this news release that are not historical facts are "forward-looking statements." These forward-looking statements are made subject to certain risks and uncertainties, which could cause actual results to differ materially from those presented. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Among the factors that could cause plans, actions and results to differ materially from current expectations are, without limitation: (1) delays in delivery and other supply chain disruptions, or increases in costs as a result of inflation or otherwise, including materials, critical components and transportation costs and shortages, the imposition of tariffs on raw materials or sourced products, and labor, or changes in or unavailability of quality suppliers or transporters, including the impacts of the foregoing risks on the Company's liquidity, (2) delays in manufacturing and delivery schedules, (3) reduction in demand for lift trucks, attachments and related aftermarket parts and service on a global basis, including any cyclical reduction in demand in the lift truck industry, (4) customer acceptance of pricing, (5) the ability of Hyster-Yale and its dealers, suppliers and end-users to access credit, or obtain financing at reasonable rates, or at all, as a result of interest rate volatility and current economic and market conditions, including inflation, (6) unfavorable effects of geopolitical and legislative developments on global operations, including without limitation the entry into new trade agreements and the imposition of tariffs and/or economic sanctions, including the Uyghur Forced Labor Prevention Act (the "UFLPA") which could impact Hyster-Yale's imports from
About
The Company's wholly owned operating subsidiary,
*****
HYSTER-YALE, INC. |
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FINANCIAL HIGHLIGHTS |
|||||||
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|
Three Months Ended |
|
Six Months Ended |
||||
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|
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|
||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(In millions, except per share data) |
||||||
|
|
|
|
|
|
|
|
Revenues |
$ 1,168.1 |
|
$ 1,090.6 |
|
$ 2,224.6 |
|
$ 2,089.9 |
Cost of sales |
908.8 |
|
892.7 |
|
1,729.6 |
|
1,717.6 |
Gross Profit |
259.3 |
|
197.9 |
|
495.0 |
|
372.3 |
Selling, general and administrative expenses |
163.7 |
|
139.1 |
|
315.6 |
|
270.9 |
Operating Profit |
95.6 |
|
58.8 |
|
179.4 |
|
101.4 |
Other (income) expense |
|
|
|
|
|
|
|
Interest expense |
8.8 |
|
8.4 |
|
17.7 |
|
18.6 |
Income from unconsolidated affiliates |
(2.1) |
|
(3.1) |
|
(3.1) |
|
(4.9) |
Other, net |
(1.1) |
|
2.7 |
|
(2.1) |
|
1.0 |
Income before Income Taxes |
90.0 |
|
50.8 |
|
166.9 |
|
86.7 |
Income tax expense |
26.1 |
|
12.0 |
|
51.2 |
|
20.7 |
Net income attributable to noncontrolling interests |
(0.2) |
|
— |
|
(0.4) |
|
(0.2) |
Net income attributable to redeemable noncontrolling interests |
(0.1) |
|
(0.2) |
|
— |
|
(0.4) |
Accrued dividend to redeemable noncontrolling interests |
(0.3) |
|
(0.3) |
|
(0.5) |
|
(0.5) |
Net Income Attributable to Stockholders |
$ 63.3 |
|
$ 38.3 |
|
$ 114.8 |
|
$ 64.9 |
|
|
|
|
|
|
|
|
Basic Earnings per Share |
$ 3.62 |
|
$ 2.23 |
|
$ 6.60 |
|
$ 3.80 |
|
|
|
|
|
|
|
|
Diluted Earnings per Share |
$ 3.58 |
|
$ 2.21 |
|
$ 6.51 |
|
$ 3.76 |
|
|
|
|
|
|
|
|
Basic Weighted Average Shares Outstanding |
17.493 |
|
17.164 |
|
17.406 |
|
17.099 |
Diluted Weighted Average Shares Outstanding |
17.659 |
|
17.307 |
|
17.631 |
|
17.265 |
|
|
|
|
|
|
|
|
EBITDA RECONCILIATION |
|||||||||
|
Quarter Ended |
|
|
||||||
|
|
|
|
|
|
|
|
|
LTM |
|
(In millions) |
||||||||
Net Income Attributable to Stockholders |
$ 35.8 |
|
$ 25.2 |
|
$ 51.5 |
|
$ 63.3 |
|
$ 175.8 |
Noncontrolling interest income and dividends |
0.6 |
|
0.5 |
|
0.3 |
|
0.6 |
|
2.0 |
Income tax expense |
16.2 |
|
16.0 |
|
25.1 |
|
26.1 |
|
83.4 |
Interest expense |
9.6 |
|
9.1 |
|
8.9 |
|
8.8 |
|
36.4 |
Interest income |
(0.7) |
|
(0.7) |
|
(1.1) |
|
(0.8) |
|
(3.3) |
Depreciation and amortization expense |
11.3 |
|
11.3 |
|
11.7 |
|
12.4 |
|
46.7 |
EBITDA* |
$ 72.8 |
|
$ 61.4 |
|
$ 96.4 |
|
$ 110.4 |
|
$ 341.0 |
|
|
|
|
|
|
|
|
|
|
*EBITDA in this press release is provided solely as a supplemental disclosure. EBITDA does not represent net income (loss), as defined by GAAP, and should not be considered as a substitute for net income or net loss, or as an indicator of operating performance. Hyster-Yale defines EBITDA as income (loss) before income taxes and noncontrolling interest income and dividends plus net interest expense and depreciation and amortization expense. EBITDA is not a measurement under GAAP and is not necessarily comparable with similarly titled measures of other companies. |
HYSTER-YALE, INC. |
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FINANCIAL HIGHLIGHTS |
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Three Months Ended |
|
Six Months Ended |
||||
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||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
(In millions) |
||||||
Revenues |
|
|
|
|
|
|
|
|
$ 881.5 |
|
$ 788.5 |
|
$ 1,651.2 |
|
$ 1,474.4 |
EMEA |
187.8 |
|
200.6 |
|
387.2 |
|
415.5 |
JAPIC |
48.7 |
|
49.6 |
|
86.4 |
|
97.5 |
Lift Truck Business |
$ 1,118.0 |
|
$ 1,038.7 |
|
$ 2,124.8 |
|
$ 1,987.4 |
|
102.4 |
|
96.6 |
|
198.6 |
|
195.2 |
Nuvera |
0.2 |
|
1.0 |
|
0.7 |
|
2.6 |
Eliminations |
(52.5) |
|
(45.7) |
|
(99.5) |
|
(95.3) |
Total |
$ 1,168.1 |
|
$ 1,090.6 |
|
$ 2,224.6 |
|
$ 2,089.9 |
|
|
|
|
|
|
|
|
Gross profit (loss) |
|
|
|
|
|
|
|
|
$ 202.1 |
|
$ 143.4 |
|
$ 380.2 |
|
$ 264.6 |
EMEA |
32.5 |
|
27.1 |
|
66.4 |
|
54.0 |
JAPIC |
4.8 |
|
6.5 |
|
8.4 |
|
14.0 |
Lift Truck Business |
$ 239.4 |
|
$ 177.0 |
|
$ 455.0 |
|
$ 332.6 |
|
22.4 |
|
22.6 |
|
44.2 |
|
43.3 |
Nuvera |
(2.5) |
|
(1.8) |
|
(4.8) |
|
(3.9) |
Eliminations |
— |
|
0.1 |
|
0.6 |
|
0.3 |
Total |
$ 259.3 |
|
$ 197.9 |
|
$ 495.0 |
|
$ 372.3 |
|
|
|
|
|
|
|
|
Operating profit (loss) |
|
|
|
|
|
|
|
|
$ 104.0 |
|
$ 65.2 |
|
$ 193.6 |
|
$ 112.7 |
EMEA |
4.8 |
|
1.1 |
|
10.0 |
|
3.7 |
JAPIC |
(5.7) |
|
(3.8) |
|
(11.2) |
|
(6.1) |
Lift Truck Business |
$ 103.1 |
|
$ 62.5 |
|
$ 192.4 |
|
$ 110.3 |
|
4.0 |
|
5.4 |
|
7.3 |
|
9.8 |
Nuvera |
(11.5) |
|
(9.2) |
|
(20.9) |
|
(19.0) |
Eliminations |
— |
|
0.1 |
|
0.6 |
|
0.3 |
Total |
$ 95.6 |
|
$ 58.8 |
|
$ 179.4 |
|
$ 101.4 |
HYSTER-YALE, INC. |
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FINANCIAL HIGHLIGHTS |
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CASH FLOW, CAPITAL STRUCTURE AND WORKING CAPITAL |
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Six Months Ended |
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|
2024 |
|
2023 |
|
|
|
|
|
(In millions) |
||
Net cash provided by operating activities |
|
|
|
$ 19.9 |
|
$ 44.8 |
|
Net cash used for investing activities |
|
|
|
|
(18.7) |
|
(11.9) |
Cash Flow Before Financing Activities |
|
|
|
|
$ 1.2 |
|
$ 32.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
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|
(In millions) |
||||||
Debt |
$ 501.9 |
|
$ 474.8 |
|
$ 494.0 |
|
$ 510.6 |
Cash |
66.5 |
|
62.2 |
|
78.8 |
|
78.2 |
Net Debt |
$ 435.4 |
|
$ 412.6 |
|
$ 415.2 |
|
$ 432.4 |
|
|
|
|
|
|
|
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|
|
|
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(In millions) |
||||||
Accounts Receivable |
$ 578.7 |
|
$ 520.5 |
|
$ 497.5 |
|
$ 512.0 |
Inventory |
790.7 |
|
841.9 |
|
815.7 |
|
815.4 |
Accounts Payable |
513.5 |
|
572.8 |
|
530.2 |
|
549.6 |
Working Capital |
$ 855.9 |
|
$ 789.6 |
|
$ 783.0 |
|
$ 777.8 |
|
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