REV Group Inc · Q1 2020 earnings

Briefing

REV Group reported results for Q1 2020 with increased net sales and decreased net loss compared to the prior year quarter.

REV Group reported a 2.6% increase in net sales to $532.1 million for the first quarter of 2020, driven by higher sales in the Fire & Emergency and Commercial segments, partially offset by a decline in the Recreation segment. The company's net loss decreased to $9.4 million, or $0.15 per diluted share, compared to a net loss of $14.6 million, or $0.23 per diluted share, in the first quarter of 2019. Adjusted EBITDA decreased to $11.3 million, driven by lower profitability in the F&E and Recreation segments, partially offset by higher profitability within the Commercial segment and lower corporate expense.

• Net sales increased by 2.6% to $532.1 million compared to the prior year quarter.
• Net loss improved to $9.4 million, compared to $14.6 million in the prior year quarter.
• Adjusted EBITDA was $11.3 million, compared to $12.3 million in the prior year quarter.
• Purchase of Spartan Emergency Response completed on February 1, 2020.

Headline financials

Revenue & EPS history

The Company is reaffirming its prior financial guidance and is also updating its outlook for fiscal year 2020 solely to include the impact of the acquisition of Spartan ER. The Company now expects the following performance for fiscal year: Net revenue of $2.6 to $2.8 billion, Net income of $9 to $30 million, Adjusted EBITDA of $107 to $123 million, Adjusted Net Income of $30 to $50 million, Capital Expenditures of $23 to $28 million, Interest expense of $29 to $33 million, Effective tax rate of 27 percent to 29 percent, Net cash provided by operating activities of $65 to $85 million, plus approximately $5 to $10 million of net cash from the sale of land and other assets