The Shyft (US:SHYF)2023-07-27 12:00Financial Performance - Sales for Q2 2023 were $225.1 million, a decrease of 3.1% from $232.2 million in Q2 2022[68] - Gross margin improved to 19.0% in Q2 2023, up from 18.1% in Q2 2022[68] - Operating income for Q2 2023 was $6.6 million, down from $7.7 million in Q2 2022[68] - Net income decreased to $4.7 million in Q2 2023, compared to $5.3 million in Q2 2022[79] - For the first six months of 2023, consolidated sales were $468.5 million, an increase of 6.7% from $439.1 million in the same period of 2022[82] - Gross profit for the first six months of 2023 was $85.7 million, a 25.9% increase from $68.0 million in the first half of 2022[84] - Net income for the first six months of 2023 increased by $5.0 million to $6.4 million compared to $1.4 million for the same period in 2022, with diluted earnings per share rising from $0.04 to $0.18[88] Order Backlog - Order backlog was $510.2 million as of June 30, 2023, a decrease of 55.1% from $1,135.2 million a year earlier[68] - The consolidated order backlog as of June 30, 2023, totaled $510.2 million, a decrease of $625.0 million or 55.1% compared to $1,135.2 million at June 30, 2022[90] Operating Expenses - Operating expenses for the first six months of 2023 rose to $75.4 million, a 14.4% increase from $65.9 million in the same period of 2022[85] Adjusted EBITDA - Adjusted EBITDA for Q2 2023 increased to $15.9 million, up from $13.7 million in Q2 2022[80] - Adjusted EBITDA for the first quarter of 2023 was $26.7 million, an increase of $13.7 million from $13.0 million in the first quarter of 2022[89] - Adjusted EBITDA for the FVS segment for the first six months of 2023 was $24.9 million, an increase of $11.2 million from $13.7 million in the first six months of 2022[103] - Adjusted EBITDA for the SV segment for the first six months of 2023 was $31.2 million, an increase of $8.2 million or 36.0% from $23.0 million in the first six months of 2022[107] Cash Flow - Cash generated from operating activities during the first six months of 2023 was $35.6 million, an increase of $72.3 million from cash used in operating activities of $36.7 million during the same period in 2022[109] - Cash used in investing activities during the first six months of 2023 was $11.4 million, an increase of $1.5 million from $9.9 million used in the same period of 2022[110] - Cash and cash equivalents decreased by $3.7 million from December 31, 2022, to a balance of $7.8 million as of June 30, 2023[108] Debt and Credit Facilities - As of June 30, 2023, the Company had $45.0 million outstanding debt under the revolving credit facility, with an increase of 100 basis points in interest rates resulting in an additional $0.5 million of annual interest expense[121] - The available borrowings under the Credit Agreement were $244.3 million as of June 30, 2023, compared to $187.2 million at December 31, 2022[115] - The revolving credit facility carries an interest rate of 6.27% as of June 30, 2023, based on one-month SOFR plus a margin[114] - The Company amended the Credit Agreement on May 31, 2023, transitioning the variable interest rate from LIBOR to SOFR, with no expected material increase in interest expense[113] - The Company remains in compliance with all covenants in the Credit Agreement as of June 30, 2023[115] Stock and Dividends - The Company has authorized a stock repurchase of up to $250.0 million, with $8.8 million spent to repurchase 348,705 shares in Q1 2023[116] - Dividends of $0.05 per share were declared on May 2, 2023, and January 31, 2023, reflecting consistent dividend payments[118] Business Developments - The company launched Blue Arc™ Electric Vehicle Solutions, including a commercial-grade EV chassis and an all-electric delivery van[68] Risk Management - The Company is exposed to commodity price fluctuations, particularly in steel and aluminum, and does not typically use derivative instruments to manage these risks[123] Internal Controls - There have been no changes in internal control over financial reporting that materially affected the Company during the quarter ended June 30, 2023[128]