NYSE$ALG

Alamo Group Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported record second quarter results driven by effective price management, supply chain improvements, and higher manufacturing throughput.

Alamo Group Inc. reported a record second quarter in 2023, with net sales increasing by 11.2% to $440.7 million and net income rising by 27.8% to $36.4 million, or $3.03 per diluted share. The results were driven by effective price management, improvement in supply chain and higher manufacturing throughput.

  • Net sales increased by 11.2% to $440.7 million.
  • Income from operations increased by 32.9% to $54.4 million.
  • Net income increased by 26.8% to $36.4 million, or $3.03 per diluted share.
  • Backlog of $891.2 million, slightly down compared to prior year second quarter-end

Headline financials

Total Revenue

$441M

Previous: $396M+11.2%
EPS (adj)

$3.03

Previous: $2.39+26.8%
Operating Margin

12.3%

No prior period
Gross Margin

26.8%

No prior period
Total Backlog

$891M

Previous: $894M-0.3%
Capital Expenditures

-$18.2M

Previous: -$15M-21.9%
Free Cash Flow

$18.1M

Previous: $13.5M+34.3%
Net Income

$36.4M

Previous: $28.5M+27.8%
Operating Income

$54.4M

Previous: $40.9M+32.9%
Gross Profit

$118M

Previous: $99.7M+18.4%
Cash & Equivalents

$112M

Previous: $75.9M+47.7%
Total Assets

$1.46B

Previous: $1.33B+9.4%
Stock-Based Comp

$1.87M

Previous: $1.75M+6.8%

Revenue & EPS history

Alamo Group · Revenue · Quarterly

$441M

Q2 2023+11.2%vs Q2 2022
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Alamo Group · $219M total across 1 segment · Q3 2021

  • Industrial Equipment
    $219M+11.6%

Forward guidance

The company expects the trends evident in the first half of the year to continue for the remainder of 2023, with a strong backlog and continued positive pricing contribution. However, a more cautious longer-term outlook is noted due to softening order activity and potential impacts from drought and declining farm income.

Tailwinds

  • Continued positive pricing contribution is anticipated in the coming quarters.
  • Better supply chain performance is expected to continue.
  • Slowing inflation is anticipated.
  • Sequential improvement of operational performance is expected to continue.
  • Governmental customer outlook remains positive.

Headwinds

  • Softer order activity was experienced in Vegetation Management.
  • Dealer concerns over rising inventories and higher interest rates.
  • Drought in many areas of North America and Europe is expected to adversely impact sales.
  • U.S. net farm income is forecast to decline this year.
  • Weakening U.S. housing market and rising biomass feedstock input costs could pressure margins for wood pellet producers.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+0.8%

Avg return

Earnings day

-0.1%

Avg return

5 days after

+0.8%

Avg return

30 days after

55%

36 / 65 earnings

Positive

+23.2%

Q3 2014

Best reaction

-16.2%

Q3 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-2.3%-4.4%-13.0%
Q4 2025-15.7%-23.0%-23.0%
Q3 2025+0.8%+0.2%-9.3%
Q1 2025+6.9%+12.3%+16.0%
Q4 2024-5.0%-3.3%-1.9%
Q3 2024+8.3%+7.9%+15.5%
Q2 2024-3.3%-9.4%-2.9%
Q1 2024+0.0%+0.1%-2.0%
Q4 2023-5.1%-5.8%-0.1%
Q3 2023+14.0%+14.5%+18.2%
Q2 2023-7.4%-7.4%-9.3%
Q1 2023+1.1%+1.7%+0.7%
Q4 2022+10.8%+13.3%+9.8%
Q3 2022-4.4%-0.9%+1.4%
Q2 2022+4.0%+5.6%+1.0%
Q1 2022-4.7%-9.8%-5.9%
Q4 2021+2.4%+2.7%+9.5%
Q3 2021-1.9%+1.9%-7.8%
Q2 2021+0.1%+2.0%+6.3%
Q1 2021+1.5%+0.4%-5.5%
Q4 2020-5.3%-4.1%-4.9%
Q3 2020+0.0%+3.9%+14.8%
Q2 2020+4.6%+5.6%+9.7%
Q1 2020+3.6%+2.5%+22.6%
Q4 2019-9.5%-6.6%-25.8%
Q3 2019-16.2%-14.4%-10.2%
Q2 2019+9.9%+7.8%+14.7%
Q1 2019-0.1%+1.9%-8.4%
Q4 2018+2.0%+2.5%+5.2%
Q3 2018+6.0%+1.7%-3.5%
Q2 2018+0.7%+1.7%+2.5%
Q1 2018-12.7%-14.6%-14.6%
Q4 2017-4.0%+0.7%-1.1%
Q3 2017+4.0%+4.9%+11.8%
Q2 2017-2.3%-0.9%-1.4%
Q1 2017+4.2%+6.8%+9.8%
Q4 2016-3.1%-3.7%-2.2%
Q3 2016+0.2%+4.3%+14.3%
Q2 2016-3.4%-1.4%-0.5%
Q1 2016+0.7%
Q4 2015+12.5%
Q3 2015+10.8%
Q2 2015-1.8%
Q1 2015-7.1%
Q4 2014+18.5%
Q3 2014+23.2%
Q2 2014+0.5%
Q1 2014-6.1%
Q4 2013+8.5%
Q3 2013+6.4%
Q2 2013+5.3%
Q1 2013+2.4%
Q4 2012+2.7%
Q3 2012-3.8%
Q2 2012-4.2%
Q1 2011-0.3%
Q1 2012+1.2%
Q4 2009+2.5%
Q4 2011+2.5%
Q3 2010-1.0%
Q3 2011-1.0%
Q2 2011-2.6%
Q2 2010-2.6%
Q4 2010-2.6%
Q1 2010+7.7%

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