The Shyft Group Reports Sales Increases for Q4, 2022

NOVI, Mich. — The Shyft Group Inc. (NASDAQ: SHYF), the parent company of Spartan Chassis and a North American leader in specialty vehicle manufacturing, assembly and upfit for the commercial, retail and service specialty vehicle markets, today reported operating results for the fourth quarter and full-year ending Dec. 31, 2022.

Fourth Quarter 2022 Financial Highlights

For the fourth quarter of 2022 compared to the fourth quarter of 2021:

• Sales of $302.0 million, an increase of $24.7 million, or 8.9%, from $277.3 million
• Income from continuing operations of $17.8 million, or $0.50 per share, compared to $20.5 million, or $0.56 per share
• Adjusted EBITDA of $30.7 million, or 10.2% of sales, an increase of $4.1 million, from $26.6 million, or 9.6% of sales; Results include $7.6 million of EV development costs versus $4.0 million in the prior year
• Adjusted net income of $20.5 million, or $0.58 per share, compared to adjusted net income of $20.2 million, or $0.56 per share in the fourth quarter of 2021
• Consolidated backlog of $832.7 million as of Dec. 31, 2022, down $130.9 million, or 13.6%, compared to $963.6 million as of Dec. 31, 2021

Full-Year 2022 Financial Highlights

For the full-year 2022 compared to the full-year 2021:

• Sales of $1.0 billion, an increase of $35.4 million, or 3.6%, from $991.8 million
• Income from continuing operations of $36.6 million, or $1.03 per share, compared to $70.0 million, or $1.91 per share; The current year reflects an effective income tax rate of 16.8%
• Adjusted EBITDA of $70.8 million, or 6.9% of sales, a decrease of $37.3 million, from $108.1 million, or 10.9% of sales; Results include $26.9 million of EV development costs versus $6.4 million in the prior year
• Adjusted net income of $44.5 million, or $1.25 per share, compared to adjusted net income of $75.0 million, or $2.08 per share in 2021
• Net leverage ratio of 0.93x times adjusted EBITDA as of Dec. 31, 2022

Daryl Adams

“I am proud of the Shyft Group team’s ability to execute and close out the year strong, with solid growth in sales and adjusted EBITDA for the fourth quarter. We overcame dynamic challenges in our supply chain and inflationary pressures, remaining nimble and responsive to the needs of our customers while taking advantage of opportunities to invest in future growth,” said Daryl Adams, President and CEO.

Fourth Quarter 2022 Business Segment Financial Highlights

Fleet Vehicles and Services (FVS)

• Sales were $212.9 million for the fourth quarter of 2022, up 16.6% or $30.3 million year over year
• Adjusted EBITDA for the fourth quarter of 2022 increased 5.6% to $27.7 million, or 13.0% of sales, compared to $26.2 million, or 14.4% of sales, a year ago
• Segment backlog was $736.7 million as of December 31, 2022, down 14.3% compared to $859.4 million as of December 31, 2021

Specialty Vehicles (SV)

• Sales were $93.2 million for the fourth quarter of 2022, a decrease of $1.5 million, or 1.5%, from $94.7 million a year ago
• Adjusted EBITDA for the fourth quarter of 2022 was $15.9 million, or 17.1% of sales, an increase of $5.6 million, or 55.2%, from $10.3 million, or 10.8% of sales, a year ago
• Segment backlog was $96.0 million as of December 31, 2022, down 7.8% compared to $104.1 million as of December 31, 2021

2023 Financial Outlook

“We are focused on delivering improved profitability in 2023. Current uncertainty surrounding broader macroeconomic conditions has led us to take a cautious approach to our outlook,” said Jon Douyard, Chief Financial Officer. “Our balance sheet strength and ample liquidity provide financial flexibility to fund operations and growth investments.”

Guidance for full-year 2023, notwithstanding further changes in the operating environment, is as follows:

• Sales to be in the range of $1.0 billion to $1.2 billion
• Adjusted EBITDA of $70 to $100 million
• Net income of $28 to $50 million, with an income tax rate of approximately 25%
• Earnings per share of $0.77 to $1.38
• Adjusted earnings per share of $0.97 to $1.59
• Capital expenditures of approximately $35 million
• Free cash flow conversion ratio as a percent of net income greater than 100%

Adams concluded, “Our Blue Arc EV timeline remains on track with vehicle production planned for the second half of the year. We are differentiating the Shyft Group by investing in transformative initiatives that will deliver meaningful long-term growth and value for our customers and shareholders.”

Conference Call and Webcast Information

The Shyft Group will host a conference call at 10 a.m. ET today to discuss these results and current business trends. The conference call and webcast will be available via:

• Webcast: www.the shyftgroup.com/webcasts
• Conference Call: 1-844-868-8845 (domestic) or 412-317-6591 (international); passcode: 10174805

For more information about Shyft, please visit www.theshyftgroup.com.

Source: https://rvbusiness.com/the-shyft-group-reports-sales-increases-for-q4-2022/