Blue Bird(US:BLBD)2025-05-07 21:32Financial Data and Key Metrics Changes - The company achieved record quarterly revenue of $359 million, which is $13 million higher than the previous year [12][23] - Adjusted EBITDA reached $49 million, representing a 14% margin, which is 6.5% better compared to the same quarter last year [11][12] - Adjusted free cash flow for the quarter was $19 million, a decrease of $35 million year-over-year primarily due to a tax carryforward benefit in 2024 [14][23] - The company ended the quarter with $131 million in cash and reduced debt by approximately $5 million over the last year [29] Business Line Data and Key Metrics Changes - The company sold 2,295 buses in Q2, with EV sales reaching a record of 265 units, which is 26% higher than last year [12][25] - Parts sales totaled $26 million in Q2, flat compared to Q1 but a small reduction of $2 million compared to the prior year [25] - The average selling price for buses increased by approximately 3%, from $141,000 to $145,000 per unit [15][25] Market Data and Key Metrics Changes - The company ended the quarter with a backlog of nearly 5,000 units, representing over six months of production [8][14] - The mix of alternative power vehicles represented 57% of unit sales in Q2, significantly higher than the typical 10% to 15% mix for major competitors [15] Company Strategy and Development Direction - The company is focused on improving operational efficiency and investing in new product development, including a new commercial chassis scheduled to launch in 2026 [20][41] - The company aims to maintain its leadership position in the alternative power segment while also strengthening its core internal combustion engine (ICE) business [10][13] - The company is navigating tariff impacts by implementing price increases and prioritizing ICE buses over EVs until the tariff situation stabilizes [33][34] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining full-year guidance despite tariff challenges, highlighting strong market demand for school buses [6][19] - The company anticipates continued strong demand for EVs, with a forecast of 800 to 1,000 EV unit sales for the full year [16][36] - Management noted that the Clean School Bus program remains a bipartisan initiative, which is expected to continue benefiting the company [48] Other Important Information - The company has executed $40 million in share repurchases over the last nine months, with an additional $20 million remaining in the current program [29] - The company is optimistic about the future of the Clean School Bus program, with funding for rounds two and three flowing to customers [17][39] Q&A Session Summary Question: Margin improvements and long-term targets - Management indicated it is early in the new CEO's tenure to speculate on margin improvements, but operational expertise may contribute positively [53][54] Question: EV pricing expectations - Current tariffs are hindering the company's ability to reduce EV prices as planned, but there is optimism for future price reductions once the tariff situation clarifies [58][59] Question: Dealer network response to pricing - The company has not faced significant pushback from dealers regarding price increases, and competitors are also implementing similar pricing actions [69][73] Question: Clean School Bus program funding - Management confirmed that rounds two and three of funding are flowing, and there is optimism for round four, although it is still in the early stages [75][106]