Hyster-Yale(US:HY)2022-05-08 06:40Financial Data and Key Metrics Changes - The company reported consolidated revenues of $827.6 million, a 13% increase from $732.2 million in the prior year, driven by improved pricing and higher unit volumes [12][13] - Despite higher revenues, the company experienced an operating loss of $18.3 million compared to an operating profit of $3.1 million in the prior year, primarily due to material and freight cost inflation totaling $68.6 million [13][15] - The consolidated net loss was $25 million, a decline from net income of $5.6 million in the prior year quarter [15] Business Line Data and Key Metrics Changes - The Lift Truck business reported an operating loss of $10.7 million, down from an operating profit of $12.2 million in the prior year, affected by increased costs and production delays [16] - Bolzoni's revenues increased by 19.6%, with operating profit improving to $2.1 million from $800,000 in the prior year, attributed to higher sales volumes and price increases [18] - Nuvera's revenue increased to $600,000, with the operating loss decreasing to $8.1 million from $9.8 million in the prior year, due to improved margins from lower production costs [19] Market Data and Key Metrics Changes - The Lift Truck market saw an 8.1% increase in bookings over the fourth quarter of 2021, although bookings were lower than the historically high prior year first quarter [11] - The company ended the quarter with a record backlog of 114,100 units, indicating strong customer demand [12] Company Strategy and Development Direction - The company is focused on managing supply chain challenges and improving margins in its backlog, particularly for new orders [27][30] - Strategic initiatives include the introduction of modular, scalable products and enhancing sales approaches [33] - The company anticipates a substantial profit in the fourth quarter of 2022, driven by improved margins and increased production as supply chain issues are resolved [41] Management's Comments on Operating Environment and Future Outlook - Management noted that the ongoing Russia-Ukraine conflict and COVID-related lockdowns in China are significant factors affecting supply chain stability and cost inflation [10][26] - The company expects to experience lower margins in the second quarter due to increased costs but anticipates stronger margins in the second half of 2022 [31][39] - Management remains confident in the long-term strategies and believes that once supply chain challenges are resolved, the company will deliver solid sales and earnings performance [52] Other Important Information - The company has implemented strict controls over operating expenses to protect liquidity and reduce cash outflow [46] - As of March 31, 2022, the company had cash on hand of $65.1 million and debt of $479 million, reflecting a decrease in debt levels due to an advanced dealer deposit program [47][48] Q&A Session Summary Question: Shipping trends and component shortages - Management indicated that production increases are dependent on component availability, with some easing observed but ongoing challenges remain due to the Russia-Ukraine conflict and COVID lockdowns in China [55][56] Question: Bookings and future expectations - Bookings remain strong, higher than expected, but management is cautious about future booking levels and aims to balance production with market demand to reduce lead times [63][66] Question: Lift Truck Americas gross margins sustainability - Management clarified that the strong margins seen in the first quarter are not expected to be sustained in the second quarter due to pressures from backlog mix and increased costs [69][70] Question: Nuvera's bookings pipeline and European dynamics - Management noted increased attention to hydrogen and fuel cells in Europe due to energy security concerns, with a growing pipeline in that region [80][84]