EARNINGS PRESENTATION FIRST QUARTER 2025 May 7, 2025 LEGAL DISCLAIMERS Forward-Looking Information This presentation 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," " ...

Part I [Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Interim%20Financial%20Statements%20%28Unaudited%29) Alta Equipment Group reported Q1 2025 total revenues of **$423.0 million**, a net loss of **$20.9 million**, and **$17.5 million** cash used in operations [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28Unaudited%29) - As of March 31, 2025, total assets were **$1,504.5 million** and total liabilities were **$1,448.5 million**, resulting in total stockholders' equity of **$56.0 million**, compared to total assets of **$1,480.4 million** and equity of **$77.6 million** at December 31, 2024[14](index=14&type=chunk) Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash | $11.1 | $13.4 | | Inventories, net | $544.6 | $535.9 | | Total current assets | $791.8 | $774.5 | | Rental fleet, net | $362.7 | $358.8 | | Goodwill | $78.0 | $77.5 | | **Total Assets** | **$1,504.5** | **$1,480.4** | | **Liabilities & Equity** | | | | Floor plan payable (new & used) | $367.3 | $374.5 | | Line of credit, net | $217.1 | $179.8 | | Long-term debt, net | $480.8 | $480.0 | | **Total Liabilities** | **$1,448.5** | **$1,402.8** | | **Total Stockholders' Equity** | **$56.0** | **$77.6** | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%28Unaudited%29) Q1 2025 vs. Q1 2024 Performance (in millions, except EPS) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $423.0 | $441.6 | | Gross Profit | $115.0 | $120.6 | | Income (Loss) from Operations | $0.8 | $(0.9) | | Net Loss | $(20.9) | $(11.9) | | Net Loss Available to Common Stockholders | $(21.7) | $(12.7) | | Basic & Diluted Loss Per Share | $(0.65) | $(0.38) | - Total revenues decreased by **4.2%** YoY, driven by declines in new and used equipment sales, rental revenues, and rental equipment sales, with net loss widening significantly due to higher interest expenses, which increased from **$16.1 million** to **$21.9 million**[15](index=15&type=chunk)[129](index=129&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%28Unaudited%29) Cash Flow Summary (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(17.5) | $(13.5) | | Net cash used in investing activities | $(14.3) | $(16.5) | | Net cash provided by financing activities | $29.5 | $4.6 | | **Net Change in Cash** | **$(2.3)** | **$(25.4)** | - The net use of cash in operations was primarily driven by a net loss and an increase in inventories (**$41.6 million**), while financing activities provided cash mainly through net proceeds from long-term borrowings (**$34.5 million**) used to fund working capital[22](index=22&type=chunk)[162](index=162&type=chunk) [Notes to Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) - On March 14, 2025, the company acquired Les Chariots Elevateurs Du Quebec Inc. (CEQ) for **$2.9 million**, reported within the Material Handling segment[91](index=91&type=chunk) - Subsequent to the quarter end, on May 1, 2025, the company divested its aerial fleet rental business in Chicago for **$18.0 million**, concurrently increasing the stock repurchase authorization to **$30.0 million** and suspending the quarterly common stock dividend[102](index=102&type=chunk)[103](index=103&type=chunk) Revenue Disaggregation by Accounting Standard (Q1 2025, in millions) | Revenue Type | Topic 842 (Leases) | Topic 606 (Contracts) | Total | | :--- | :--- | :--- | :--- | | New and used equipment sales | $— | $221.7 | $221.7 | | Parts sales | $— | $72.0 | $72.0 | | Service revenues | $— | $66.1 | $66.1 | | Rental revenues | $42.3 | $— | $42.3 | | Rental equipment sales | $— | $20.9 | $20.9 | | **Total revenues** | **$42.3** | **$380.7** | **$423.0** | [Management's Discussion and Analysis (MD&A)](index=33&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the **4.2%** revenue decline to normalizing demand and Q4 2024 pull-forward, with cost savings offsetting higher interest expenses that led to a larger net loss - The company operates one of North America's largest integrated equipment dealership platforms with over **85** locations, focusing on sales, rental, parts, and service for material handling and construction equipment[106](index=106&type=chunk)[107](index=107&type=chunk) - The growth strategy is primarily based on strategic acquisitions to expand geographic reach and service offerings, complemented by organic growth through new OEM relationships[111](index=111&type=chunk)[112](index=112&type=chunk) - The **4.2%** decrease in total revenue was primarily due to a **3.0%** decline in new/used equipment sales and a **12.8%** drop in rental revenues, attributed to normalizing industry demand for lift trucks and demand pull-forward from Q4 2024[136](index=136&type=chunk) - Operating expenses decreased by **$7.3 million** (**6.9%**) YoY, mainly due to cost savings from a headcount reduction of over **6.0%** implemented in the second half of 2024[139](index=139&type=chunk) [Consolidated Results of Operations](index=37&type=section&id=Consolidated%20Results%20of%20Operations) Consolidated Financial Highlights (Q1 2025 vs Q1 2024, in millions) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues | $423.0 | $441.6 | (4.2)% | | Gross Profit | $115.0 | $120.6 | (4.6)% | | Gross Margin | 27.2% | 27.3% | (0.1) p.p. | | Income (Loss) from Operations | $0.8 | $(0.9) | (188.9)% | | Net Loss | $(20.9) | $(11.9) | 75.6% | | Adjusted EBITDA | $33.6 | $34.1 | (1.5)% | [Material Handling Segment Results](index=40&type=section&id=Material%20Handling%20Segment%20Results) - Segment revenue decreased **9.4%** to **$157.9 million**, driven by a **16.7%** drop in new and used equipment sales as industry lift truck deliveries normalized from post-COVID highs[142](index=142&type=chunk)[143](index=143&type=chunk) - Despite lower revenue, segment gross margin improved by **210 basis points** to **34.6%**, largely due to a **270 basis point** increase in service margins from better pricing and technician productivity[143](index=143&type=chunk)[144](index=144&type=chunk) Material Handling Performance (Q1 2025 vs Q1 2024, in millions) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues | $157.9 | $174.3 | (9.4)% | | Gross Profit | $54.6 | $56.7 | (3.7)% | | Income from Operations | $5.6 | $5.6 | 0.0% | | Segment Adjusted EBITDA | $15.6 | $14.5 | 7.6% | [Construction Equipment Segment Results](index=42&type=section&id=Construction%20Equipment%20Segment%20Results) - Segment revenue decreased **3.8%** to **$245.8 million**, mainly from a **28.7%** drop in rental equipment sales and a **15.5%** decrease in rental revenues, as strong Q4 2024 sales pulled demand forward and lowered the available rent-to-sell fleet[147](index=147&type=chunk)[148](index=148&type=chunk) - Segment gross margin fell by **90 basis points** to **22.7%**, driven by lower margins on new and used equipment sales (due to competitive pricing) and rental equipment sales (due to higher equipment costs and softer used market prices)[149](index=149&type=chunk) Construction Equipment Performance (Q1 2025 vs Q1 2024, in millions) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues | $245.8 | $255.6 | (3.8)% | | Gross Profit | $55.9 | $60.3 | (7.3)% | | Loss from Operations | $(2.7) | $(0.6) | 350.0% | | Segment Adjusted EBITDA | $17.0 | $21.3 | (20.2)% | [Master Distribution Segment Results](index=44&type=section&id=Master%20Distribution%20Segment%20Results) - Segment revenue increased significantly by **35.9%** to **$17.4 million**, driven by a **62.6%** increase in new and used equipment sales as sub-dealer inventory levels normalized from an oversupply situation in 2024, allowing for restocking[152](index=152&type=chunk)[153](index=153&type=chunk) - Segment gross margin decreased by **380 basis points** to **25.9%**, primarily because high-margin rental revenue and rental equipment sales present in Q1 2024 did not recur in Q1 2025[155](index=155&type=chunk) Master Distribution Performance (Q1 2025 vs Q1 2024, in millions) | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Total Revenues | $17.4 | $12.8 | 35.9% | | Gross Profit | $4.5 | $3.8 | 18.4% | | Income (Loss) from Operations | $1.1 | $(1.1) | (200.0)% | | Segment Adjusted EBITDA | $1.5 | $0.9 | 66.7% | [Liquidity and Capital Resources](index=46&type=section&id=Liquidity%20and%20Capital%20Resources) - The company's principal sources of liquidity are cash from operations, sales of equipment, and borrowings under its ABL Facility and floor plans, with **$11.1 million** in cash as of March 31, 2025[164](index=164&type=chunk) - As of March 31, 2025, the company had **$401.6 million** of available borrowings under its ABL Facility and Floor Plan Facilities, which management believes will be adequate to meet liquidity needs for the foreseeable future[167](index=167&type=chunk) - Gross rental fleet capital expenditures were **$40.4 million** for Q1 2025, offset by **$20.9 million** in proceeds from the sale of rental equipment[166](index=166&type=chunk) [Market Risk Disclosures](index=50&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from interest rate fluctuations, commodity prices, and foreign currency exchange rates through derivative instruments like interest rate caps and fuel swaps - As of March 31, 2025, a one percentage point increase in interest rates on variable-rate debt would reduce annual pre-tax earnings by an estimated **$2.5 million**, including the impact of the interest rate cap[172](index=172&type=chunk) - The company has fixed-rate debt of **$500.0 million** in Senior Secured Second Lien Notes, which is not subject to interest rate fluctuation risk[173](index=173&type=chunk) - The company manages fuel price volatility by using fixed price swap contracts, with a hypothetical **$0.10 per gallon** increase in fuel prices not expected to have a material impact on pre-tax income[174](index=174&type=chunk) [Controls and Procedures](index=50&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - Based on an evaluation as of March 31, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures were effective[176](index=176&type=chunk) - No changes occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[177](index=177&type=chunk) Part II - Other Information [Legal Proceedings](index=51&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings, but management anticipates no material financial impact from their resolution - Various legal proceedings are pending against the company, but management does not expect them to have a material financial impact[70](index=70&type=chunk)[179](index=179&type=chunk) [Risk Factors](index=51&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the 2024 Annual Report on Form 10-K - No material changes have been identified from the risk factors disclosed in the 2024 Annual Report on Form 10-K[180](index=180&type=chunk) [Share Repurchases and Use of Proceeds](index=51&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No shares were repurchased in Q1 2025, but the Board subsequently increased the repurchase authorization to **$30.0 million** and approved a **$10.0 million** Rule 10b5-1 plan - No shares were repurchased in Q1 2025, and as of March 31, 2025, **$14.2 million** remained authorized for repurchase[181](index=181&type=chunk) - Subsequent to the quarter, the Board increased the stock repurchase program authorization to **$30.0 million** and approved a **$10.0 million** Rule 10b5-1 plan[182](index=182&type=chunk)

[Q1 2025 Performance Overview](index=1&type=section&id=Q1%202025%20Performance%20Overview) Alta Equipment Group reported a Q1 2025 revenue decline and net loss, partially offset by stable Adjusted EBITDA and reduced SG&A, with varied segment performance [First Quarter Financial Highlights](index=1&type=section&id=First%20Quarter%20Financial%20Highlights) In the first quarter of 2025, Alta Equipment Group reported total revenues of $423.0 million, a 4.2% decrease year-over-year, experiencing a net loss of $(21.7) million or $(0.65) per share, while Adjusted EBITDA remained stable at $33.6 million and SG&A expenses decreased by $7.9 million Q1 2025 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $423.0M | $441.6M | -4.2% | | Product Support Revenues | $138.1M | - | Modest YoY Increase | | SG&A Expenses | - | - | Down $7.9M YoY | | Net Loss to Common Stockholders | $(21.7)M | $(12.7)M | Increased Loss | | Basic & Diluted EPS | $(0.65) | $(0.38) | Increased Loss | | Adjusted EBITDA* | $33.6M | $34.1M | -1.5% | [CEO Commentary on Performance](index=1&type=section&id=CEO%20Commentary%20on%20Performance) CEO Ryan Greenawalt highlighted the business's resilience amid macroeconomic uncertainty, noting stable Construction Equipment trends, declining Material Handling new equipment sales offset by stronger margins, continued strength in product support, and significant SG&A expense reductions - The Construction Equipment business was **stable**, benefiting from a focus on infrastructure-related projects, which is expected to drive consistent demand for the rest of the year[3](index=3&type=chunk) - Material Handling new equipment sales were **down** compared to peak levels in Q1 2024, but this was partly offset by **stronger margins** on new and used equipment sales. Bookings in this segment were **solid**, filling the sales pipeline for H2 2025[3](index=3&type=chunk) - The product support business continued to be a "**pillar of strength**," demonstrating resilience amid volatile economic sentiment[3](index=3&type=chunk) - Cost and inventory optimization initiatives resulted in a **$7.9 million** year-over-year **decrease** in SG&A expenses[3](index=3&type=chunk) [Segment Revenue Performance](index=1&type=section&id=Segment%20Revenue%20Performance) For the first quarter, Construction Equipment revenue decreased by 3.8% to $245.8 million due to a strategic reduction in the rent-to-sell fleet, Material Handling revenue declined by 9.4% to $157.9 million, while Master Distribution revenue significantly rebounded by 35.9% to $17.4 million Q1 2025 Revenue by Segment | Segment | Q1 2025 Revenue | YoY Change | | :--- | :--- | :--- | | Construction Equipment | $245.8 million | -3.8% | | Material Handling | $157.9 million | -9.4% | | Master Distribution | $17.4 million | +35.9% | [Strategic Updates and Outlook](index=1&type=section&id=Strategic%20Updates%20and%20Outlook) The company divested its Chicago aerial fleet business, suspended dividends to expand share repurchases, and updated its full-year 2025 Adjusted EBITDA guidance [Business Divestiture](index=1&type=section&id=Business%20Divestiture) On May 1, 2025, Alta completed the divestiture of its Chicagoland aerial fleet rental equipment business for $18.0 million in cash, citing misalignment with strategic priorities and competitive environment, with proceeds used to reduce outstanding debt - On May 1, 2025, the company sold its aerial fleet rental business in the Chicago area for **$18.0 million** in cash[3](index=3&type=chunk)[6](index=6&type=chunk) - The divested business had an implied enterprise value of approximately **$20 million** and generated an estimated **$4 million** in annual proforma Adjusted EBITDA[6](index=6&type=chunk) - Proceeds from the divestiture are allocated towards reducing the company's outstanding senior indebtedness[3](index=3&type=chunk)[6](index=6&type=chunk) [Capital Allocation Strategy](index=3&type=section&id=Capital%20Allocation%20Strategy) The company rebalanced its capital allocation strategy by indefinitely suspending the quarterly common stock dividend, redirecting approximately $8 million annually to an expanded $30 million share repurchase program, including an immediate $10 million allocation to a Rule 10b5-1 plan - The quarterly common stock dividend has been **suspended indefinitely** to reallocate capital[5](index=5&type=chunk)[6](index=6&type=chunk) - The share repurchase program authorization was **increased by $10 million**, bringing the total to **$30 million**[5](index=5&type=chunk)[6](index=6&type=chunk) - An immediate allocation of **$10 million** was made to a Rule 10b5-1 Plan to facilitate stock purchases, even during blackout periods[5](index=5&type=chunk)[6](index=6&type=chunk) - The approximately **$8 million** in annual dividend payments will be repurposed for the expanded share buyback program[5](index=5&type=chunk)[6](index=6&type=chunk) [Full Year 2025 Financial Guidance](index=3&type=section&id=Full%20Year%202025%20Financial%20Guidance) Following the divestiture of its Chicago aerial fleet business, Alta reaffirmed its organic guidance and updated its full-year 2025 forecast, now expecting Adjusted EBITDA in the range of $171.5 million to $186.5 million - The company updated its full-year 2025 guidance for Adjusted EBITDA to a range of **$171.5 million to $186.5 million**, reflecting the impact of the recent divestiture[6](index=6&type=chunk) [Consolidated Financial Statements (Unaudited)](index=4&type=section&id=Consolidated%20Financial%20Statements%20(Unaudited)) Unaudited Q1 2025 financial statements show decreased revenues, increased net loss, a slight rise in total assets and liabilities, and increased cash usage from operations [Condensed Consolidated Results of Operations](index=4&type=section&id=Condensed%20Consolidated%20Results%20of%20Operations) For the three months ended March 31, 2025, total revenues decreased to $423.0 million from $441.6 million, driven by lower equipment and rental sales, resulting in a gross profit decline to $115.0 million, and despite reduced SG&A, higher interest expenses led to a net loss of $(20.9) million Q1 2025 vs Q1 2024 Income Statement Highlights (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $423.0 | $441.6 | | Gross Profit | $115.0 | $120.6 | | SG&A Expenses | $106.7 | $114.6 | | Income (Loss) from Operations | $0.8 | $(0.9) | | Total Other Expense, Net | $(21.0) | $(15.2) | | Net Loss | $(20.9) | $(11.9) | | Net Loss Available to Common Stockholders | $(21.7) | $(12.7) | [Condensed Consolidated Balance Sheets](index=9&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, Alta reported total assets of $1,504.5 million, a slight increase from year-end 2024, while total liabilities rose to $1,448.5 million primarily due to a higher line of credit, leading to a decrease in total stockholders' equity to $56.0 million Balance Sheet Highlights (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Current Assets | $791.8 | $774.5 | | Total Assets | $1,504.5 | $1,480.4 | | Total Current Liabilities | $583.9 | $577.2 | | Total Liabilities | $1,448.5 | $1,402.8 | | Total Stockholders' Equity | $56.0 | $77.6 | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In Q1 2025, the company used $17.5 million in cash from operating activities, an increase from the prior year, while net cash provided by financing activities significantly increased to $29.5 million due to higher long-term borrowings, resulting in an overall cash decrease of $2.3 million Cash Flow Summary (in millions) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Cash Used in Operating Activities | $(17.5) | $(13.5) | | Net Cash Used in Investing Activities | $(14.3) | $(16.5) | | Net Cash Provided by Financing Activities | $29.5 | $4.6 | | **Net Change in Cash** | **$(2.3)** | **$(25.4)** | | **Cash, End of Period** | **$11.1** | **$5.6** | [Non-GAAP Financial Measures](index=8&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP reconciliations for Q1 2025 present Adjusted EBITDA and Adjusted pre-tax net loss, providing alternative performance metrics [Reconciliation of Non-GAAP Measures](index=12&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) For Q1 2025, Adjusted EBITDA was $33.6 million, reconciled from a net loss of $(21.7) million by adjusting for non-cash and other items, while Adjusted pre-tax net loss available to common stockholders was $(15.8) million, or $(0.48) per share, and Adjusted total net debt and floor plan payables stood at $827.2 million Reconciliation of Net Loss to Adjusted EBITDA (in millions) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss available to common stockholders | $(21.7) | $(12.7) | | Depreciation and amortization | $32.4 | $34.0 | | Interest expense | $21.9 | $16.1 | | Income tax provision (benefit) | $0.7 | $(4.2) | | Other adjustments | $(0.7) | $(0.1) | | **Adjusted EBITDA** | **$33.6** | **$34.1** | Adjusted Pre-Tax Net Loss per Share | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Adjusted pre-tax net loss | $(15.8)M | $(11.4)M | | Adjusted basic pre-tax net loss per share | $(0.48) | $(0.34) |

Core Viewpoint - Alta Equipment Group Inc. reported a decrease in total revenues for the first quarter of 2025, highlighting the resilience of its business model despite macroeconomic uncertainties. The company is focusing on infrastructure-related projects, which are expected to drive consistent demand for heavy equipment throughout the year [2][3]. Financial Performance - Total revenues for the quarter were $423.0 million, a decrease of 4.2% compared to the first quarter of the previous year [4][8]. - Construction Equipment revenue was $245.8 million, down 3.8%, primarily due to a strategic initiative to reduce the rent-to-sell fleet size [4][8]. - Material Handling revenues decreased by 9.4% to $157.9 million, while the Master Distribution business saw a significant rebound with a 35.9% increase in revenues to $17.4 million [4][8]. - Adjusted EBITDA for the quarter was $33.6 million, slightly down from $34.1 million a year ago [4][8]. Cost Management - Selling, general and administrative expenses were reduced by $7.9 million year over year, contributing to improved margins [4][8]. - The service gross profit percentage increased by 230 basis points year over year to 60.1% [4][8]. Strategic Initiatives - The company has entered into a definitive agreement to divest substantially all of its aerial fleet rental equipment business in the Chicagoland market for $18.0 million, with proceeds allocated to reducing outstanding debt [3][8]. - The Board of Directors has authorized the indefinite suspension of the quarterly common stock dividend, reallocating approximately $8 million in annual dividend payments to an expanded share repurchase program [5][8]. Market Outlook - The stability in the Construction Equipment segment is attributed to customers focusing on infrastructure-related projects, which are expected to drive consistent demand for heavy equipment [3][8]. - The company reaffirms its organic guidance range, expecting Adjusted EBITDA for the fiscal year 2025 to be between $171.5 million and $186.5 million [8].

Core Viewpoint - Alta Equipment Group Inc. will report its financial results for the first quarter of 2025 on May 7, 2025, after U.S. market close, followed by a conference call and webcast to discuss the results [1] Company Overview - Alta Equipment Group Inc. is a leading provider of premium material handling, construction, and environmental processing equipment, operating one of the largest integrated equipment dealership platforms in North America [3] - The company has a branch network with over 85 locations across various states in the U.S. and Canadian provinces, offering a comprehensive range of specialized equipment and services [3] Conference Call Details - The earnings call and webcast will take place on May 7, 2025, at 5:00 p.m. Eastern Time, with live call access and audio replay options available [2]

Financial Performance - Q4 2024 - Total revenue decreased by $23.4 million, a 4.5% decline, reaching $498.1 million compared to $521.5 million in Q4 2023 [12, 26] - Adjusted EBITDA decreased by 18.1% to $40.7 million, down from $49.7 million in Q4 2023 [26] - GAAP income from operations was $2.4 million, a decrease from $12.2 million in Q4 2023 [26] Financial Performance - Full Year 2024 - Revenue remained effectively flat at $1,876.6 million, compared to $1,876.8 million in 2023 [15] - Adjusted EBITDA decreased by 12.1%, or $23.1 million, to $168.3 million from $191.4 million in 2023 [16] - Income from Operations decreased $35.8 million, from $54.4 million year ended 2023 to $18.6 million in 2024 [15] Segment Performance - Q4 2024 - Construction segment revenue decreased by $9.5 million, a 2.9% decline, to $318.6 million [30] - Material Handling segment revenue decreased by $10.4 million, a 5.8% decline, to $168.6 million [30] - Master Distribution revenue was $11.5 million, a decrease from $17.6 million in Q4 2023 [30] Rental Fleet - Total rental fleet decreased by $29.6 million, ending at $571.2 million compared to $600.8 million in 2023 [42] - Rent-to-Rent fleet increased by $25.7 million to $224.2 million [42] - Rent-to-Sell fleet decreased by $55.3 million to $347.0 million [42] 2025 Outlook - Adjusted EBITDA is projected to be between $175.0 million and $190.0 million [67] - Organic revenue decreased by 3.5% compared to 2023 [36, 60]

Financial Data and Key Metrics Changes - For the full year 2024, total revenue remained steady at approximately $1.9 billion, indicating resilience in the dealership model despite market challenges [10] - In Q4 2024, revenue declined 4.5% year-over-year to $498.1 million, but showed sequential growth compared to Q3, suggesting a post-election rebound [11][31] - Adjusted EBITDA for 2024 reached $168.3 million, down from $201 million in 2023, reflecting a $33 million gap primarily due to reduced equipment sales and margin compression [36][37] Business Segment Data and Key Metrics Changes - In the construction equipment segment, new and used equipment sales saw a 10.2% organic decline, while organic product support revenues increased by 3.7% year-over-year [15] - The material handling segment's revenue remained stable at $687.4 million for the year, a 0.9% increase from 2023, supported by product support growth [19] - The electric vehicle segment continues to see steady momentum, particularly in hydrogen-powered fleets, despite challenges in charging infrastructure [22] Market Data and Key Metrics Changes - The construction equipment sector faced challenges due to oversupply and tightening credit conditions, with significant regional variations in sales performance [13][14] - The North American lift truck market experienced a decline in new order bookings, impacting future sales velocity [18] - The backlog of federal infrastructure spending under the IIJA program remains a long-term catalyst for growth [15] Company Strategy and Development Direction - The company is focused on operational efficiency, disciplined capital allocation, and strategic growth through M&A, prioritizing high-margin recurring business lines [24][26] - The rent-to-sell strategy is emphasized as a critical tool for optimizing fleet utilization and balance sheet efficiency [17] - The company aims to enhance profitability through cost optimization and improving fleet utilization [24] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a complex macroeconomic environment in 2024 but expressed confidence in the company's diversified business model to navigate market volatility [8][10] - The outlook for 2025 includes expectations for improved EBITDA driven by better volumes in material handling and product support revenues [40][42] - Management remains cautious about the impact of macroeconomic factors on future performance, particularly regarding inflation and interest rates [44] Other Important Information - The company successfully raised $500 million in senior second lien bonds to refinance senior debt and extend maturities to 2029, enhancing liquidity [12] - The company ended 2024 with approximately $330 million in cash and availability on a revolving line of credit, providing a comfortable liquidity position [38] Q&A Session Summary Question: What are the underlying assumptions for equipment sales volume in the guidance? - Management indicated that the guidance does not assume aggressive growth in equipment sales, particularly in the construction segment, but expects to regain market share as supply overhang diminishes [60][62] Question: How should immediate actions be prioritized to lower balance sheet leverage? - Management plans to use cash flows to pay down debt and does not intend to grow the fleet in the near term, which should help improve the leverage ratio [66][68] Question: What efficiency measures have been implemented in product support operating expenses? - Management noted that initial cost-cutting measures have been completed, with further efficiency gains expected from technician productivity improvements in 2025 [74][76] Question: What is the outlook for the warehouse solutions business? - Management expressed optimism about returning to previous peak levels within the next 12 months, driven by organic growth and market trends favoring automation [80][82]

Market Performance - North American construction equipment market sales declined by approximately 10% in 2024, with some regions experiencing reductions of up to 20%[144] - Volvo Construction Equipment reported a 20% decline in North American sales, attributed to slowing end-user demand and elevated inventory levels[144] - North American rental utilization rates began to recede in 2024, leading to a $46.0 million reduction in rental fleet gross cost, totaling $571.2 million as of December 31, 2024[147] - The North American lift truck market exhibited growth in 2024, driven by robust manufacturing sectors and expanding logistics operations[145] - Equipment supply chain constraints gradually subsided throughout 2023, leading to increased new equipment inventories[146] Financial Performance - Consolidated revenues decreased by $0.2 million to $1,876.6 million for the year ended December 31, 2024, compared to 2023, primarily due to a decline in new and used equipment sales[171] - New and used equipment sales dropped by $38.9 million, or 3.8%, to $987.0 million, while parts sales increased by $16.1 million, or 5.8%, to $294.4 million[171] - Gross profit decreased by $13.5 million, or 2.7%, to $493.7 million, with a gross profit margin decline from 27.0% in 2023 to 26.3% in 2024[172] - Operating expenses increased by 4.9% to $475.1 million, driven by the impact of acquisitions and costs associated with organic growth[173] - Adjusted EBITDA decreased by $23.1 million, or 12.1%, to $168.3 million for the year ended December 31, 2024[166] Segment Performance - Total revenues for the Material Handling segment increased by $5.9 million to $687.4 million in 2024, with organic revenue growth of $4.1 million, or 0.6%[177] - New and used equipment sales decreased by $2.4 million, or 0.7%, to $365.2 million in 2024, while rental equipment sales surged by $5.3 million, or 101.9%[176] - Total revenues for the Construction Equipment segment increased by $6.7 million to $1,131.4 million in 2024, with parts sales rising by 9.8%[181] - Income from operations for the Construction Equipment segment fell by $26.2 million, or 73.8%, to $9.3 million in 2024[181] - Master Distribution segment revenues decreased by $24.6 million to $59.2 million in 2024, attributed to reduced sales volumes as sub-dealer stocking levels were full[190] Operational Insights - Approximately 44% of the company's employees are skilled service technicians, highlighting the focus on service and maintenance[153] - The company experienced strong demand for skilled technicians' labor and replacement parts, despite a reduction in equipment utilization year over year[148] - Service revenues improved by 3.9%, reflecting a positive trend in product support despite overall revenue challenges[171] Cash Flow and Investments - For the year ended December 31, 2024, the company reported a net cash provided by operations of $57.0 million, with a net loss of $62.1 million adjusted for non-cash items resulting in net cash inflows of $63.5 million[194] - Cash used in investing activities for 2024 was $56.2 million, primarily due to $73.4 million in purchases of rent-to-rent equipment, partially offset by $17.2 million in proceeds from sales[196] - Cash used in financing activities for 2024 was $17.9 million, primarily due to the extinguishment of $319.4 million in Senior Secured Second Lien Notes and principal payments of $639.9 million on long-term debt[198] Debt and Interest - The company’s ability to pay interest and principal on its indebtedness will depend on future operating performance and the availability of borrowings[203] - As of December 31, 2024, outstanding borrowings under the ABL Facility were $182.9 million, down from $317.5 million in 2023[219] - A 1% increase in interest rates applicable to variable rate debt would reduce annual pre-tax earnings by $2.6 million[219] - The company has fixed rate Senior Secured Second Lien Notes of $500.0 million due in 2029, with no exposure to changing interest rates as of December 31, 2024[220] Strategic Outlook - The company anticipates a rebound in lift truck bookings in the second half of 2025 as supply and demand factors normalize[145] - The company anticipates pursuing additional strategic acquisitions and opening new start-up locations in the future[201]

Financial Performance - Total revenues for 2024 decreased 4.5% year over year to $498.1 million, with construction and material handling revenues at $318.6 million and $168.6 million, respectively[4]. - Net loss available to common stockholders for 2024 was $(65.1) million, compared to a net income of $5.9 million in 2023, resulting in a basic and diluted net loss per share of $(1.96) compared to $0.18 in 2023[4]. - Adjusted EBITDA for 2024 decreased 12.1% to $168.3 million from $191.4 million in 2023[4]. - New and used equipment sales decreased 3.8% to $987.0 million for the full year 2024[4]. - Total revenues for 2024 were $1,876.6 million, slightly down from $1,876.8 million in 2023, representing a decrease of 0.01%[22]. - Net loss for 2024 was $62.1 million, compared to a net income of $8.9 million in 2023, indicating a significant decline in profitability[22]. - Gross profit for 2024 was $493.7 million, down from $507.2 million in 2023, reflecting a decrease of 2.8%[22]. - Operating income fell to $18.6 million in 2024 from $54.4 million in 2023, a decline of 65.8%[22]. - Cash provided by operating activities was $57.0 million in 2024, slightly down from $58.4 million in 2023[24]. - Cash paid for interest increased to $76.4 million in 2024 from $53.6 million in 2023, indicating higher financing costs[24]. - Total cost of revenues for 2024 was $1,382.9 million, up from $1,369.6 million in 2023, an increase of 1.5%[22]. - The company ended 2024 with cash of $13.4 million, down from $31.0 million at the end of 2023[24]. - Total debt increased to $1,103.4 million in 2024 from $1,068.6 million in 2023, representing a rise of 3.0%[26]. - Adjusted total net debt and floor plan payables reached $796.6 million in 2024, up from $739.8 million in 2023, an increase of 7.7%[26]. - The company incurred interest expenses of $81.3 million for the year ended December 31, 2024, up from $57.0 million in 2023, an increase of 42.6%[26]. - Depreciation and amortization expenses were $144.5 million for the year ended December 31, 2024, compared to $132.6 million in 2023, reflecting a rise of 9.0%[26]. Revenue Segments - Product support revenues increased 5.5% year over year, with parts sales rising to $294.4 million and service revenues increasing to $253.8 million[5]. - The material handling segment showed resilience with revenues of $687.4 million, a slight increase from the previous year[5]. - Equipment volumes in some regional markets were down approximately 10% to 20% year over year, impacting gross margins and market share in the construction segment[4]. Shareholder Returns - The company returned $13.6 million to shareholders in 2024 despite a challenging business climate[5]. Assets and Liabilities - Total assets decreased from $1,570.9 million in 2023 to $1,480.4 million in 2024, a decline of approximately 5.7%[20]. - Cash reserves fell from $31.0 million in 2023 to $13.4 million in 2024, representing a decrease of about 56.5%[20]. - Accounts receivable decreased from $249.3 million in 2023 to $199.7 million in 2024, a reduction of approximately 20%[20]. - Total current liabilities decreased from $635.1 million in 2023 to $577.2 million in 2024, a decline of about 9.1%[20]. - Long-term debt increased from $312.3 million in 2023 to $480.0 million in 2024, an increase of approximately 53.7%[20]. - The accumulated deficit grew from $76.4 million in 2023 to $149.3 million in 2024, an increase of about 95.3%[20]. Future Outlook - The company expects to report Adjusted EBITDA between $175.0 million and $190.0 million for the 2025 fiscal year[6]. - Future outlook includes addressing supply chain disruptions and labor market dynamics that may impact financial performance[14]. - The company emphasizes the importance of innovation and market expansion as part of its growth strategy[14]. Market Performance - The company achieved organic growth in product support for the fifth consecutive year since going public, demonstrating the strength of its dealership model[5]. - Net loss available to common stockholders was $(11.4) million for Q4 2024, compared to a loss of $(2.7) million in Q4 2023[26]. - EBITDA for the year ended December 31, 2024, was $156.5 million, down 17.3% from $189.1 million in 2023[26]. - Adjusted EBITDA for the year ended December 31, 2024, was $168.3 million, a decrease of 12.1% from $191.4 million in 2023[26]. - Basic net loss per share was $(0.34) for Q4 2024, compared to $(0.08) in Q4 2023[26]. - Diluted net loss per share was also $(0.34) for Q4 2024, consistent with the basic loss per share[26]. - The company reported a loss on auction sale of $2.8 million in Q4 2024, indicating challenges in the used and rental equipment market[26].

Core Insights - Alta Equipment Group Inc. reported a decline in financial performance for 2024, influenced by elevated interest rates and reduced construction spending, leading to a decrease in equipment volumes and gross margins [4][5][6] - The company's Material Handling segment showed resilience with a slight revenue increase, while the Construction segment faced significant challenges [4][5][6] - Despite the overall decline, the company managed to maintain flat total revenues year-over-year, demonstrating the strength of its dealership model and diversified revenue streams [6] Financial Highlights for Q4 2024 - Total revenues decreased by 4.5% year-over-year to $498.1 million, with Construction and Material Handling revenues at $318.6 million and $168.6 million, respectively [5][8] - New and used equipment sales fell by 3.7% to $287.1 million, while product support revenues decreased by 2.3% [5][8] - The net loss available to common stockholders was $(11.4) million, compared to $(2.7) million in 2023, with a basic and diluted net loss per share of $(0.34) [5][8] Full Year 2024 Financial Highlights - Total revenues for 2024 were $1,876.6 million, essentially flat compared to $1,876.8 million in 2023 [5][9] - New and used equipment sales decreased by 3.8% to $987.0 million, while parts and service revenues increased by 5.8% and 5.2%, respectively [5][9] - The net loss available to common stockholders for the year was $(65.1) million, compared to a profit of $5.9 million in 2023, with an adjusted EBITDA decrease of 12.1% to $168.3 million [5][9] Segment Performance - The Material Handling segment's revenues increased to $687.4 million, reflecting growth in North American lift truck deliveries as the industry addressed post-COVID backlogs [4][5] - The Construction segment faced a decline in equipment volumes by approximately 10 to 20 percent year-over-year, leading to pressured pricing and gross margins [4][5] - The Master Distribution segment also experienced negative impacts on equipment volumes and gross margins due to the challenges faced in the Construction segment [4][5] Management Commentary - The CEO highlighted the impact of macroeconomic factors on performance, including interest rates and construction spending, while expressing optimism for 2025 based on expected normalization of equipment supply and ongoing capital investment in construction markets [4][6] - The company successfully achieved organic growth in its product support business for the fifth consecutive year, indicating resilience despite market challenges [6] 2025 Financial Guidance - The company expects to report Adjusted EBITDA between $175.0 million and $190.0 million for the 2025 fiscal year, reflecting a positive outlook compared to 2024 [7]