Awards across its generator portfolio reflect the company's dedication to innovative design and product engineeringWAUKESHA, Wis., March 27, 2025 /PRNewswire/ -- Generac Holdings, Inc. (NYSE: GNRC), a leading global designer, manufacturer and provider of energy technology solutions and other power products, has been recognized with GOOD DESIGN Awards in 2024 for the Generac XG04045 Liquid-Cooled Home Standby Generator and the Generac GP7500E Dual Fuel Portable Generator.GOOD DESIGN, the world's longest runn ...

Core Points - WillScot Holdings Corporation announced the retirement of current Chairman Erik Olsson at the 2025 Annual Meeting, with Worthing Jackman set to be appointed as the new non-executive, independent Chairman [1][2][3] - Dominick (Nick) Zarcone has been nominated to stand for election to the Board, marking the fourth new independent director added in the past three years, bringing significant executive leadership and finance expertise [1][2][4] - The company aims to achieve free cash flow of $4 to $6 per share in the next three to five years, supported by a portfolio of growth levers and operational enhancements [2][3] Company Overview - WillScot is a leading provider of innovative temporary space solutions in North America, offering a comprehensive range of products including modular office complexes, mobile offices, and portable storage containers [8] - The company operates approximately 260 branch locations across the United States, Canada, and Mexico, serving diverse customer segments across various sectors of the economy [8] Leadership Background - Nick Zarcone previously served as President & CEO of LKQ Corporation and has extensive experience in finance and corporate governance [4][5] - Worthing Jackman has a strong background in waste management services and investment banking, and he is recognized as a Qualified Financial Expert [6][7]

Group 1 - The year 2025 is anticipated to present significant challenges related to climate and trade issues, which could create a sense of urgency and concern in various sectors [1] - The author has extensive experience in foreign policy research and investment analysis, focusing on deep-discount value plays and underappreciated companies [1] - The investment philosophy is influenced by contrarian strategies, particularly those of David Dreman, emphasizing the importance of returning value to investors [1]

Business Expansion and Market Position - The company has established the largest network of factory direct independent generator dealers in North America, with significant investments made to grow this dealer network [85]. - The company has expanded its solar contractor base to sell and service PWRcell energy storage systems, aiming to increase market share in the clean energy sector [86]. - The company has made numerous acquisitions of industrial distributors since 2020 to enhance its coverage and market share in the C&I product sales [87]. - The retail distribution channel includes thousands of locations globally, driving significant brand awareness for residential standby and portable generators [88]. - The company’s competitive advantages include a broad product offering, diverse omni-channel distribution model, and strong factory support [106]. Research and Development - Approximately 1,250 engineers are focused on research and development, driving innovation in energy technology products and solutions [93]. - The company is focused on developing alternative technologies such as fuel cells and hydrogen to maintain its leadership position in energy technology solutions [95]. - Research and development expenses increased to $219,600, up 26.6% from $173,443 in 2023, indicating a focus on innovation [339]. Financial Performance - Net sales for 2024 reached $4,295,834, an increase of 6.8% compared to $4,022,667 in 2023 [339]. - Net income attributable to Generac Holdings Inc. for 2024 was $316,315,000, an increase from $214,606,000 in 2023 [292]. - Adjusted EBITDA for 2024 reached $789,101,000, compared to $637,859,000 in 2023, reflecting a growth of approximately 23.6% [292]. - Total current assets increased to $2,032,170, up from $1,997,692 in 2023, marking a growth of 1.7% [337]. - Total liabilities decreased to $2,611,888, down from $2,743,693 in 2023, a reduction of 4.8% [337]. Employee and Management Focus - The company emphasizes employee health and safety as its top priority, supported by a total rewards program focused on balance, security, well-being, and community [117]. - The company plans to continue focusing on employee engagement initiatives with targeted action plans measured by global surveys [118]. - The company is committed to attracting and retaining skilled employees, but faces challenges such as higher turnover rates and competitive compensation pressures [156]. Regulatory and Compliance Challenges - The company’s products are subject to stringent regulations from the U.S. Environmental Protection Agency (EPA) and other regulatory bodies, impacting emissions standards [113]. - Increased scrutiny regarding sustainability practices could impact the company's reputation and financial results [152]. - Regulatory requirements around sustainability-related disclosures may impose additional costs and resources [153]. - Environmental, health, and safety regulations could result in substantial costs and liabilities for non-compliance [176]. Supply Chain and Operational Risks - The company has diversified its global supply chain to mitigate the impact of trade tariffs, continuously evaluating supplier quality and cost structures [102]. - The company relies on a small number of outside contract manufacturers and single-source suppliers, which poses risks to its operations [132]. - The company has faced challenges in obtaining adequate, cost-efficient, and timely deliveries of raw materials and components, impacting its ability to manufacture products [131]. - Manufacturing disruptions could prevent the company from meeting customer demand, negatively impacting sales and financial results [158]. Financial Management and Capital Structure - As of December 31, 2024, total indebtedness was $1,334.2 million, with $498.8 million under the Tranche B Term Loan Facility and $712.5 million under the Tranche A Term Loan Facility [187][259]. - Total liquidity as of December 31, 2024, was $1,530.5 million, consisting of $281.3 million in cash and cash equivalents and $1,249.2 million available under the Revolving Facility [261]. - The company repurchased 1,046,351 shares of common stock for $152.7 million in 2024 and 2,188,475 shares for $251.5 million in 2023 [263]. - The company anticipates requiring additional capital to fund shareholder value-enhancing activities as it continues to expand its business [266]. Legal and Intellectual Property Issues - The company considers its intellectual property rights important assets and seeks to protect them through various legal means [133]. - The company has been subject to third-party intellectual property infringement claims, which could be costly and time-consuming to defend [134]. - Legal and regulatory proceedings may divert management attention and incur significant expenses, potentially affecting financial performance [170]. Market and Economic Conditions - Demand for products is significantly affected by unpredictable power outage activity, impacting financial results [143]. - Economic conditions, including prolonged downturns in residential investment and rising interest rates, could negatively impact product demand [145]. - Changes in U.S. trade policy, including tariffs, could adversely affect sales, gross margins, and profitability across segments [159]. Risk Management - Cybersecurity risks remain a concern, with potential impacts on sales and reputation due to data breaches or attacks on IT systems [185]. - The company engages in commodity risk management activities to mitigate the impact of price fluctuations on financial results [312]. - The company is exposed to floating interest rate risk on all outstanding debt under its Term Loans and Revolving Facility as of December 31, 2024 [313].

Core Insights - Generac Holdings Inc. (GNRC) reported better-than-expected fourth-quarter 2024 results, with adjusted EPS of $2.80 and net sales of $1.23 billion, surpassing Zacks Consensus Estimates by 12% and 0.1% respectively [1][2] - Year-over-year, net sales increased by 16% and adjusted EPS surged by 35.3%, driven primarily by strong Residential product sales [2][3] Financial Performance - Residential product revenues surged 28% year-over-year to $743 million, although it fell short of the Zacks Consensus Estimate of $771 million [3][4] - Gross profit reached $501.4 million, up from $388.7 million in the prior-year quarter, with gross profit margins improving to 40.6% from 36.5% [10] - Operating income increased by 31.2% year-over-year to $198 million, while adjusted EBITDA rose to $265 million from $213 million a year ago [10] Market Dynamics - The company is focusing on expanding its residential dealer network, which grew to 9,200 dealers by the end of 2024, an increase of 500 from the end of 2023 [5] - New product launches and significant investments in manufacturing capacity are expected to drive future revenues [6] Future Outlook - For 2025, Residential Product sales are projected to grow in the mid-to-high single-digit range, with revenues from residential energy technology solutions expected to be between $300 million to $400 million [7] - Generac anticipates maintaining margin expansion, projecting a 100-basis-point increase in gross margins due to lower input costs [11] Segment Performance - The Commercial & Industrial (C&I) segment showed weakness, with revenues remaining flat at $363 million year-over-year, and expectations for flat sales in 2025 [12] - Management noted that growth in telecom C&I BESS and data center opportunities may be offset by declines in other C&I markets [12] Cash Flow and Share Buyback - In the fourth quarter, the company generated $339 million in net cash from operating activities, with free cash flow totaling $286 million [13] - Generac approved a new share buyback authorization of up to $500 million over the next 24 months, replacing the previous program [14]

Financial Data and Key Metrics Changes - For Q4 2024, overall net sales increased 16% to $1.23 billion compared to $1.06 billion in Q4 2023 [45] - Adjusted EBITDA reached a record $265 million, or 21.5% of net sales, up from $213 million, or 20% of net sales, in the prior year [49] - Full year 2024 adjusted EBITDA was $789 million, or 18.4% of net sales, compared to $638 million, or 15.9% in 2023 [49][51] Business Line Data and Key Metrics Changes - Residential product sales grew 28% to $743 million in Q4 2024, driven by increased shipments of home standby and portable generators [46] - C&I product sales were approximately flat at $363 million, with strong domestic growth offset by declines in rental and beyond standby applications [47] - Other products and services saw a 6% increase to $128 million, primarily due to growth in aftermarket service parts and connectivity subscription sales [48] Market Data and Key Metrics Changes - The U.S. experienced nearly 1.5 billion hours lost due to power outages in 2024, marking the most active year since 2010 [13] - International sales, excluding currency impacts, increased modestly, with strength in Latin America offset by softness in Europe [41] - The North American Electricity Reliability Corporation warned of risks of power outages due to supply shortfalls over the next five years [15] Company Strategy and Development Direction - The company is focused on its "Powering a Smarter World" strategy, developing energy ecosystems to help customers manage power costs and improve resiliency [16][18] - Significant investments have been made in manufacturing capacity and strategic acquisitions to expand the total addressable market [18][57] - The introduction of next-generation home standby generators aims to enhance market position and meet growing demand [24][25] Management's Comments on Operating Environment and Future Outlook - Management highlighted the increasing demand for backup power solutions due to severe weather patterns and aging power infrastructure [14][15] - The outlook for 2025 anticipates continued net sales growth of 3% to 7%, with residential product sales expected to increase at a mid to high single-digit rate [59][60] - Management expressed confidence in the company's ability to navigate potential tariff impacts through cost reductions and price increases [10][64] Other Important Information - Free cash flow reached an all-time quarterly record of $286 million in Q4 2024, driven by strong operating earnings and working capital reduction [55] - The company repurchased approximately 1.05 million shares for $153 million during the year, with $347 million remaining on the current share repurchase authorization [58] - Capital expenditures for 2024 totaled $137 million, focusing on organic investments for production capacity [57] Q&A Session Summary Question: Can you provide context on the new C&I products and their market potential? - Management expressed excitement about the new C&I products for data centers, highlighting the tight supply chain and long lead times from existing suppliers, indicating ample opportunity for market participation [75][76] Question: What is the expected margin impact from the energy tech business? - Management noted that Ecobee achieved profitability in Q4 2024 and expects overall energy tech business dilution to improve to around 3% to 3.5% in 2025 [82][83] Question: What are the residential growth expectations for Q1? - Management indicated strong double-digit growth for residential products in Q1, partially offset by a high single-digit decline in C&I products [95]

INVESTOR PRESENTATION INVESTOR RELATIONS Aaron Jagdfeld PRESIDENT & CEO YorkRagen CHIEF FINANCIAL OFFICER Kris Rosemann DIRECTOR CORPORATE DEVELOPMENT & INVESTOR RELATIONS (262)506 -6064 InvestorRelations@generac.com 2 Forward Looking Statements Certain statements contained in this presentation, as well as other information provided from time to time by Generac Holdings Inc. or its employees, may contain forward-looking statements that involve risks and uncertainties that could cause actual results to diffe ...

Core Insights - Generac Holdings (GNRC) reported quarterly earnings of $2.80 per share, exceeding the Zacks Consensus Estimate of $2.50 per share, and up from $2.07 per share a year ago, representing an earnings surprise of 12% [1] - The company achieved revenues of $1.23 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 0.06% and increasing from $1.06 billion year-over-year [2] - Generac Holdings has outperformed consensus EPS estimates in all four of the last quarters and has topped consensus revenue estimates three times during the same period [2] Earnings Outlook - The sustainability of the stock's price movement will largely depend on management's commentary during the earnings call [3] - The current consensus EPS estimate for the upcoming quarter is $1.56 on revenues of $1.03 billion, and for the current fiscal year, it is $8.16 on revenues of $4.63 billion [7] Industry Context - The Manufacturing - General Industrial industry, to which Generac Holdings belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact investor sentiment [5]

Financial Performance - Fourth quarter net sales increased 16% to $1.23 billion compared to $1.06 billion in the prior-year quarter[4] - Full-year 2024 net sales increased 7% to $4.30 billion, with core sales growing approximately 6%[4] - Net sales for Q4 2024 reached $1,234,801, a 16.1% increase from $1,063,670 in Q4 2023[33] - Total net sales for the year ended December 31, 2024, reached $4,295,834, an increase of 6.8% compared to $4,022,667 in 2023[38] - Domestic net sales for the year ended December 31, 2024, were $3,635,081, up from $3,320,261 in 2023, reflecting a growth of 9.5%[38] - International net sales for the year ended December 31, 2024, decreased to $725,385 from $837,895 in 2023, a decline of 13.4%[38] Profitability Metrics - Adjusted EBITDA reached a record $265 million, representing 21.5% of net sales, up from 20.0% in the prior year[4] - Adjusted EBITDA for the year ended December 31, 2024, was $789,101, compared to $637,859 in 2023, representing an increase of 23.6%[40] - Operating income for the year increased to $536,742, representing a 39.0% rise compared to $386,199 in 2023[33] - Net income attributable to Generac Holdings Inc. for the year was $316,315, a 47.4% increase from $214,606 in 2023[33] Cash Flow and Assets - Cash flow from operations reached a record $741 million for the full year, compared to $522 million in the prior year[4] - Free cash flow for the year ended December 31, 2024, was $741,301, compared to $521,670 in 2023[35] - Free cash flow for the year ended December 31, 2024, was $604,568, compared to $395,904 in 2023, an increase of 52.7%[45] - Total current assets increased to $2,032,170 as of December 31, 2024, from $1,997,692 in 2023[31] - Cash and cash equivalents at the end of the period were $281,277, up from $200,994 in 2023[35] Sales Breakdown - Residential product sales rose 28% to $743 million, while Commercial & Industrial product sales were approximately flat at $363 million[4] - Residential products sales for the three months ended December 31, 2024, were $743,336, up from $580,391 in 2023, a growth of 28.1%[38] - Commercial & industrial products sales for the three months ended December 31, 2024, were $363,376, slightly up from $362,923 in 2023[38] Expenses and Liabilities - Research and development expenses for the year were $219,600, an increase of 26.7% from $173,443 in 2023[33] - Total liabilities decreased to $2,611,888 in 2024, down from $2,743,693 in 2023[31] Shareholder Actions - The company repurchased approximately 1.05 million shares for $153 million during 2024, with $347 million remaining under the current repurchase program[4] Legal and Regulatory Matters - The company incurred $5.4 million in legal expenses related to patent lawsuits in the fourth quarter of 2024[46] - The company reported a provision of $5.8 million for civil fines related to a matter with the Consumer Product Safety Commission for the full year 2023[46]

Core Insights - Generac Holdings Inc. reported record fourth quarter net sales of $1.23 billion, a 16% increase from $1.06 billion in the same quarter of the previous year, driven by strong demand for residential products [4][5] - The company achieved an all-time record free cash flow of $286 million in the fourth quarter, up from $266 million in the prior year [4][9] - For the full year 2024, net sales increased by 7% to $4.30 billion compared to $4.02 billion in 2023, with residential product sales rising 18% [4][5] Fourth Quarter 2024 Highlights - Residential product sales surged 28% to $743 million, while Commercial & Industrial (C&I) product sales remained flat at $363 million [4] - Net income attributable to the company was $117 million, or $2.15 per share, compared to $97 million, or $1.57 per share, in the same period of 2023 [4] - Adjusted EBITDA reached a record $265 million, representing 21.5% of net sales, compared to $213 million, or 20.0% of net sales, in the prior year [4][6] Full-Year 2024 Highlights - The company reported a net income of $316 million, or $5.39 per share, compared to $215 million, or $3.27 per share, in 2023 [4] - Adjusted net income for 2024 was $438 million, or $7.27 per share, up from $335 million, or $5.40 per share, in 2023 [4] - Cash flow from operations for the year was a record $741 million, compared to $522 million in the previous year [4] Business Segment Results - Domestic segment sales increased 20% to $1.07 billion, driven by significant growth in home standby and portable generators [10] - Adjusted EBITDA for the domestic segment was a record $242.8 million, or 22.7% of total sales, compared to $192.2 million, or 21.6% of total sales, in the prior year [11] - International segment sales decreased 1% to $187.5 million, impacted by foreign currency fluctuations, with core growth driven by Latin America [12][13] 2025 Outlook - The company anticipates net sales growth of approximately 3% to 7% for 2025, primarily from residential product sales [15] - Adjusted EBITDA margin is expected to be around 18.0% to 19.0% for the full year [16] - The company aims to maintain strong operating and free cash flow, with free cash flow conversion from adjusted net income projected between 80% to 90% [16]