The Shyft (US:SHYF)2025-02-20 14:30Financial Data and Key Metrics Changes - The company reported Q4 sales of $201.4 million, slightly down from $202.3 million in the prior year [12] - GAAP net loss was $3.4 million or $0.1 per share, an improvement from a net loss of $4.4 million or $0.13 per share in the previous year [12] - Adjusted EBITDA for the quarter was $15.9 million or 7.9% of sales, up from $2.3 million or 1.1% of sales in Q4 2023 [13] - Adjusted net income for the quarter was $5 million, with adjusted EPS increasing to $0.15 per share compared to a loss of $0.03 per share in Q4 2023 [13] Business Line Data and Key Metrics Changes - Fleet Vehicles and Service segment sales were $110.7 million, down 7% from $119 million a year ago, with adjusted EBITDA improving to $12.1 million from a loss of $2.6 million [12][14] - Specialty Vehicles segment sales increased to $87.5 million, a 5% increase from $83.4 million in the prior year, with adjusted EBITDA at $16.6 million or 19% of sales [15] Market Data and Key Metrics Changes - Fleet Vehicles and Service backlog was $244.8 million at year-end, down 24.7% versus 2023, reflecting continued softness in the parcel market [14] - Specialty Vehicles backlog was $68.5 million at the end of the year, down 18.8% versus 2023, primarily due to a decrease in motorhome orders [15] Company Strategy and Development Direction - The proposed merger with Abby Schmidt aims to create a competitive leader in the specialty vehicles market, enhancing scale and capabilities [6][20] - The company is focused on operational improvements and increasing efficiencies, which resulted in adjusted EBITDA growth and margin improvements [7][10] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about near-term demand for parcel and motorhome vehicles, expecting softness to persist through midyear but anticipating a modest recovery in the second half of the year [17] - The company expects 2025 sales to range from $870 million to $970 million, including approximately $50 million related to BlueArc [18] Other Important Information - The company achieved a significant milestone by bringing BlueART to production, successfully shifting EV trucks to FedEx [9] - The balance sheet remains solid with net leverage less than two times, allowing flexibility for strategic investments [9] Q&A Session Summary Question: Update on BlueArc and delivery cadence - The company is in production phase for FedEx orders and has vehicles performing well in the field, but additional orders are needed to fulfill the $50 million sales target [28][30][33] Question: Outlook for parcel demand recovery - Management is closely monitoring key parcel customers and anticipates a replacement cycle for vehicles, expecting recovery in the second half of the year [39] Question: Specialty Vehicle order trends - Weakness in the motorhome market is driving order flow issues, but steady orders are expected in the work truck segment [41][42] Question: Infrastructure growth expectations - The merger with Abby Schmidt is expected to accelerate growth, particularly in infrastructure-focused segments [47] Question: Sustainability of Fleet Vehicles and Service margins - The company expects to maintain low double-digit margins in the Fleet Vehicles and Service segment due to operational efficiencies [48][49] Question: Impact of tariffs on pricing - The company is evaluating tariff impacts and has plans to mitigate risks through supply chain strategies and potential price increases [55]