Company Overview - The merger between Shyft Group, Inc. and Aebi Schmidt Holding AG has been completed, resulting in the formation of Aebi Schmidt Group, a leader in the specialty vehicles sector [1][2] - The combined company reported a pro forma revenue of $1.9 billion and adjusted EBITDA of $148 million for 2024 [4] Leadership and Governance - Barend Fruithof has been appointed as the Group Chief Executive Officer, while James Sharman serves as the Chairman of the Board of Directors [5] - The leadership team combines expertise from both legacy organizations to ensure effective integration and performance [5] Market Position and Strategy - Aebi Schmidt Group is positioned as a differentiated global leader with expanded reach across North America and Europe, complemented by enhanced operational capabilities [2][3] - The merger aims to accelerate innovation and enhance global market leadership, focusing on delivering customer-driven solutions [3] Stock and Trading Information - Shares of Aebi Schmidt Group are set to begin trading on NASDAQ under the ticker symbols "AEBIV" on a "when-issued" basis and "AEBI" on a "regular-way" basis starting July 1 and July 2, 2025, respectively [2] - Shyft's common stock has been delisted from NASDAQ as part of the merger process [6][7]

Company Overview - The Shyft Group, Inc. is a leader in specialty vehicle manufacturing, assembly, and upfit for commercial, retail, and service markets in North America, reporting sales of $786 million in 2024 [5] - Aebi Schmidt Group is a global leader in intelligent solutions for infrastructure and agricultural applications, generating net sales of over 1 billion EUR in 2024 and employing around 3,000 people [6][7] Merger Details - Shareholders of Shyft approved the merger agreement with Aebi Schmidt, with approximately 99% of votes in favor, representing about 81% of total outstanding shares as of May 13, 2025 [2][3] - The merger is expected to close on or around July 1, 2025, with the combined company to be named "Aebi Schmidt Group" and trading on NASDAQ under the ticker symbol "AEBI" [1][3] - Each share of Shyft common stock will be exchanged for approximately 1.04 shares of the combined company's common stock upon completion of the merger [3] Strategic Implications - The merger aims to create a differentiated global leader in the specialty vehicles industry, enhancing scale, capabilities, and customer value [4] - The combined entity is expected to unlock meaningful value for customers and shareholders, positioning itself for continued growth [4]

Core Points - The Shyft Group, Inc. is advancing towards a proposed merger with Aebi Schmidt Group, with significant regulatory milestones achieved as of May 2025 [1][2][3] - The merger is set to be voted on by Shyft shareholders at a special meeting scheduled for June 17, 2025, with the transaction expected to close in mid-2025, pending approval [2][3] - The combined entity will operate under the name "Aebi Schmidt Group" and will be listed on NASDAQ with the ticker symbol "AEBI" [3] Financial Overview - Pro forma combined U.S. GAAP financial results for 2024 indicate approximately $1.9 billion in revenue and $148 million in adjusted EBITDA for the merged business [2] - Shyft reported sales of $786 million in 2024, highlighting its position as a leader in specialty vehicle manufacturing [4] Company Background - The Shyft Group specializes in manufacturing, assembly, and upfit of specialty vehicles for commercial, retail, and service markets, serving a diverse customer base including government entities and utility sectors [4] - The company operates through two core business units: Shyft Fleet Vehicles and Services™ and Shyft Specialty Vehicles™, employing around 2,900 individuals across multiple facilities in North America and Mexico [4]

Core Viewpoint - The Shyft Group, Inc. is moving forward with a proposed all-stock merger with Aebi Schmidt Holdings, AG, which is set to be voted on by shareholders on June 17, 2025, with Shyft shareholders expected to own 48% of the combined company [1][2][3]. About the Transaction - The merger agreement was announced on December 16, 2024, and involves an exchange of each outstanding share of Shyft common stock for approximately 1.04 shares of the combined company's common stock [2]. - The transaction is structured to be tax-free for Shyft shareholders and has received unanimous approval from the boards of directors of both companies [3]. Company Overview - The Shyft Group is a leader in specialty vehicle manufacturing, assembly, and upfit for various markets, including commercial, retail, and service specialty vehicles [5]. - Shyft operates two core business units: Shyft Fleet Vehicles and Services™ and Shyft Specialty Vehicles™, and has a diverse portfolio of brands [5]. - The company reported sales of $786 million in 2024 and employs approximately 2,900 individuals across multiple facilities in North America and Mexico [5].

Core Insights - Spartan RV Chassis has formed a strategic partnership with Rush Truck Centers to enhance service support for motorhome owners across the U.S. and Canada [1][2] - The collaboration adds 148 Rush Truck Centers to the Spartan RV Chassis authorized service network, providing a wide range of chassis maintenance and repair services [2][3] - The partnership aims to improve customer experience by ensuring reliable access to high-quality service and support for Spartan RV Chassis owners [2][3] Company Overview - The Shyft Group is a leader in specialty vehicle manufacturing and assembly, with a reported sales figure of $786 million in 2024 [5] - The company operates various brands, including Spartan RV Chassis, and employs approximately 2,900 individuals across multiple facilities in North America and Mexico [5] - Rush Enterprises operates the largest network of commercial vehicle dealerships in North America, with over 150 locations in 23 states and Ontario, Canada [6][7] Service Enhancements - The partnership allows motorhome owners to access expert service and technical knowledge, ensuring they can maintain their vehicles with confidence [3] - Spartan RV Chassis offers a comprehensive warranty program, including a 20-year transferable warranty on the frame and cross members, a five-year, 100,000-mile warranty on Cummins engines, and a five-year, 200,000-mile warranty on Allison transmissions [3] - Owners can utilize the Spartan RV Chassis Connected Care® App to locate authorized service centers and access maintenance schedules and diagnostic tools [4]

Core Viewpoint - The Shyft Group (SHYF) is identified as a strong value stock, currently undervalued compared to its industry peers, with favorable valuation metrics and a positive earnings outlook [4][7]. Valuation Metrics - SHYF has a P/E ratio of 8.77, significantly lower than the industry average of 18.61 [4]. - The company's P/B ratio stands at 1.20, compared to the industry's average P/B of 3.17 [5]. - SHYF's P/S ratio is 0.39, which is also lower than the industry's average P/S of 0.53 [6]. Investment Potential - The combination of a Zacks Rank of 2 (Buy) and an A grade in the Value category indicates that SHYF is among the strongest value stocks currently available [3][4]. - The historical P/E range for SHYF has been between 7.51 and 26.31, with a median of 14.98 over the past year, suggesting potential for price appreciation [4]. - The P/B ratio has fluctuated between 1.01 and 2.32, with a median of 1.70, indicating solid valuation compared to its book value [5].

Financial Data and Key Metrics Changes - The company reported Q1 2025 sales of $204.6 million, a 3% increase from $197.9 million in the prior year [22] - Adjusted EBITDA for the quarter was $12.3 million, representing 6% of sales, up from $6.1 million or 3.1% of sales in Q1 2024 [24] - GAAP net loss was $1.4 million or negative $0.04 per share, compared to a net loss of $4.7 million or negative $0.14 per share in the previous year [23] Business Line Data and Key Metrics Changes - Fleet Vehicles and Services segment achieved sales of $96.1 million, down 11% from $107.8 million a year ago, with adjusted EBITDA improving to $3.6 million or 3.8% of sales [25] - Specialty Vehicles segment reported sales of $82.2 million, a 9% decrease from $90.1 million in the prior year, with adjusted EBITDA at $14.3 million or 17.3% of sales [27] Market Data and Key Metrics Changes - The FVS backlog was $245.3 million at quarter end, down 31% year-over-year and flat compared to year-end 2024 [25] - Specialty Vehicles backlog was $90 million at quarter end, up 8% year-over-year and up 31% compared to year-end [28] Company Strategy and Development Direction - The company is focused on customer-centric innovation and expanding its product portfolio, particularly in electric vehicles [9][19] - The proposed merger with Aebi Schmidt is expected to create a leading global force in the specialty vehicles industry, enhancing growth in high-margin markets [32][33] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about the timing of recovery in the parcel and motorhome markets, expecting approximately 70% of full-year adjusted EBITDA to be delivered in the second half of the year [30] - The company is affirming its 2025 outlook with sales projected between $870 million to $970 million and adjusted EBITDA of $62 million to $72 million [29] Other Important Information - The company maintains a solid balance sheet with a net leverage ratio of less than 2x, allowing flexibility for strategic investments [13] - The company has successfully syndicated a $600 million credit facility to support the merger with Aebi Schmidt [36] Q&A Session Summary Question: Update on Blue Arc vehicle orders and revenue - Management confirmed that the 150-unit order for FedEx will be completed in Q2, with additional orders in the pipeline [42][61] Question: Impact of tariffs on guidance - Management stated that they are closely monitoring tariffs and have implemented pricing strategies to mitigate risks, which is reflected in their unchanged guidance [44][48] Question: Trends in Aebi Schmidt's business - Management refrained from commenting on Aebi Schmidt's performance as the S-4 filing is still under review by the SEC [50] Question: Customer order timing related to tariffs - Management indicated that there was no significant pull-forward of orders due to tariffs [53] Question: Outlook for parcel and final-mile vehicles - Management noted an increase in quoting activity from parcel customers, suggesting a potentially better second half of the year [56]

Group 1 - The Shyft Group reported quarterly earnings of $0.07 per share, exceeding the Zacks Consensus Estimate of a loss of $0.10 per share, compared to a loss of $0.04 per share a year ago [1] - The earnings surprise for the quarter was 170%, with the company having surpassed consensus EPS estimates three times over the last four quarters [2] - The company posted revenues of $204.6 million for the quarter, surpassing the Zacks Consensus Estimate by 1.34%, and compared to revenues of $197.89 million a year ago [3] Group 2 - The Shyft Group shares have declined approximately 37.8% since the beginning of the year, while the S&P 500 has declined by 8.6% [4] - The current consensus EPS estimate for the upcoming quarter is $0.15 on revenues of $217.5 million, and for the current fiscal year, it is $0.82 on revenues of $898.8 million [8] - The Automotive - Original Equipment industry, to which The Shyft Group belongs, is currently ranked in the bottom 36% of over 250 Zacks industries, indicating potential underperformance compared to higher-ranked industries [9]

Financial Data and Key Metrics Changes - The company reported sales of $204.6 million for Q1 2025, a 3% increase from $197.9 million in the prior year [15] - Adjusted EBITDA for the quarter was $12.3 million, representing 6% of sales, up from $6.1 million or 3.1% of sales in Q1 2024 [16] - GAAP net loss was $1.4 million or negative $0.04 per share, compared to a net loss of $4.7 million or negative $0.14 per share in the previous year [15][16] Business Line Data and Key Metrics Changes - Fleet Vehicles and Services segment achieved sales of $96.1 million, down 11% from $107.8 million a year ago, reflecting softness in parcel end markets [17] - Specialty Vehicles segment delivered sales of $82.2 million, a 9% decrease from $90.1 million in the prior year, with adjusted EBITDA margins remaining in the high teens [18] Market Data and Key Metrics Changes - The FES backlog was $245.3 million at quarter end, down 31% versus the prior year and flat compared to year-end 2024 [18] - Specialty Vehicles backlog was $90 million at quarter end, up 8% versus the prior year and up 31% versus year-end, driven primarily by high content service truck bodies [19] Company Strategy and Development Direction - The company is focused on customer-centric innovation and expanding its product portfolio, particularly in electric vehicles and service trucks [6][10] - The proposed merger with Abbe Schmidt is expected to create a leading global force in the specialty vehicles industry, driving growth in high-margin markets [23][24] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about the timing of recovery in the parcel and motorhome markets but expects approximately 70% of full-year adjusted EBITDA to be delivered in the second half of the year [21] - The company is affirming its 2025 outlook with sales projected between $870 million to $970 million and adjusted EBITDA of $62 million to $72 million [20][21] Other Important Information - The company incurred $2.2 million in transaction costs related to the proposed merger with Abbe Schmidt [16] - The merger is anticipated to be approved in a special meeting of shareholders in mid-2025 [24] Q&A Session Summary Question: Update on BlueArc vehicle orders and revenue - Management confirmed that the order for 150 vehicles for FedEx is in process, with some revenue carryover expected into Q2 [29] Question: Impact of tariffs on guidance - Management stated that they are closely monitoring tariffs and have implemented pricing strategies to mitigate risks, which is reflected in their unchanged guidance [31][34] Question: Trends in Abbe Schmidt's business - Management refrained from commenting on Abbe Schmidt's financials as the S-four filing is still with the SEC [37] Question: Customer order timing related to tariffs - Management indicated that there was no significant pull-forward of orders due to tariff concerns [41] Question: Outlook for parcel and final mile vehicles - Management noted an increase in quoting activity from parcel customers, suggesting a potentially better second half of the year [43] Question: Update on battery supply chain - Management expressed confidence in the battery supply chain, stating that performance is meeting expectations and there are no issues in the field [49]

Financial Performance - Sales for Q1 2025 were $204.6 million, an increase of 3.4% from $197.9 million in Q1 2024[83] - Gross margin improved to 19.7% in Q1 2025, up from 17.2% in Q1 2024[83] - Operating income for Q1 2025 was $1.7 million, compared to an operating loss of $1.9 million in Q1 2024[83] - Net loss decreased to $1.4 million in Q1 2025 from a net loss of $4.7 million in Q1 2024[93] - Adjusted EBITDA for Q1 2025 was $12.3 million, an increase of 101.6% from $6.1 million in Q1 2024[94] Order Backlog - Order backlog as of March 31, 2025, was $335.3 million, a decrease of 23.7% from $439.4 million a year earlier[83] - The consolidated backlog as of March 31, 2025, totaled $335.3 million, a decrease of $104.1 million, or 23.7%, from $439.4 million at March 31, 2024[95] - The Fleet Vehicles and Services (FVS) backlog decreased by $110.8 million, or 31.1%, primarily due to vehicle sales and softer demand in delivery vans[96] Segment Performance - Sales in the FVS segment were $96.1 million for Q1 2025, a decrease of $11.7 million or 10.8% compared to $107.8 million in Q1 2024[107] - Adjusted EBITDA for the FVS segment increased to $3.6 million in Q1 2025 from $0.9 million in Q1 2024, an increase of $2.7 million[108] - Sales in the Specialty Vehicles (SV) segment were $82.2 million in Q1 2025, down $7.9 million or 8.8% from $90.1 million in Q1 2024[109] - Adjusted EBITDA for the SV segment decreased to $14.3 million in Q1 2025 from $17.0 million in Q1 2024, a decrease of $2.7 million[110] Cash Flow and Debt - Cash and cash equivalents increased by $0.4 million to $16.2 million as of March 31, 2025[111] - Cash used in operating activities was $4.5 million in Q1 2025, an increase of $0.5 million from $4.0 million in Q1 2024[112] - The company generated $9.9 million of cash through financing activities in Q1 2025, a decrease of $3.0 million from $12.9 million in Q1 2024[114] - As of March 31, 2025, the company had $110.0 million in outstanding debt under its revolving credit facility[124] - The revolving credit facility allows borrowing up to $300.0 million, with available borrowings totaling $76.9 million as of March 31, 2025[118] Market Risks and Commodity Exposure - A hypothetical increase of 100 basis points in interest rates would lead to an additional $1.1 million in annual interest expense[124] - The company does not utilize derivative instruments to manage exposure to fluctuations in steel and aluminum prices[125] - The company engages in pre-buys of components affected by commodity price changes to mitigate exposure to price increases[125] - There has been no material change in the nature or categories of primary market risk exposures as of the report date[126] - The company does not anticipate any significant changes in its primary market risk exposure in the near term, defined as one year from the most recent balance sheet[126] - Prevailing interest rates and commodity costs are influenced by market factors beyond the company's control[127] Strategic Initiatives - The acquisition of Independent Truck Upfitters was completed for $49.9 million, with an additional earn-out of up to $8.0 million[83] - The company introduced the Blue Arc™ Electric Vehicle Solutions, with the Class 4 all-electric truck now in production[83] - The Rapid Driver Cooling System was deployed in 5,860 walk-in vans, enhancing driver comfort and vehicle efficiency[83] - The merger with Aebi Schmidt is expected to close in mid-2025, with Shyft shareholders owning approximately 48% of the combined company[79]