MACON, Ga. — Blue Bird Corporation (NASDAQ: BLBD), the leading independent designer and manufacturer of school buses, announced today its fiscal 2019 third-quarter results.
Compared with the prior year, Blue Bird improved Adjusted EBITDA by $4.9 million (up 20 percent) in the third quarter to $29.0 million, despite higher commodity costs and lower volume.
Meanwhile, Diluted EPS and Adjusted Diluted EPS were lower than last year, down 22 cents and 23 cents, which is more than explained by a one-time tax benefit that was recorded in the third quarter of FY 2018.
“We are pleased with our third-quarter performance and our continued progress in key areas of the business,” said Phil Horlock, president/CEO of Blue Bird Corporation. “The bus pricing we took in late fiscal 2018 to offset rapidly-increasing commodity costs, together with a record 53 percent mix of alternative-fueled bus sales, contributed to an 8 percent increase in net revenue per bus in the third quarter, compared with last year.”
According to Horlock, the company “achieved significant structural cost reductions from the Transformational Initiatives we started last year, and expects continued gains through FY 2019 and beyond from the implementation of these plans. The lower volume was primarily driven by delivery timing, with units produced at the end of the third quarter being delivered and sold in the fourth quarter. We are pleased to reaffirm our FY 2019 full-year revenue guidance of $990-$1,025 million and Adjusted EBITDA guidance of $80-85 million.”
Horlock explained that “We are focused on delivering differentiated and innovative products that customers want and value, as demonstrated by our continued growth in alternative-fueled bus sales, with year-to-date bookings and firm order backlog at 21 percent above last year. With the broadest range of alternative-fueled school bus offerings in the market, offered at the lowest emission levels, we are the clear product and sales leader in the fastest-growing segment of the business.”
Horlock concluded, “While making significant capital investments in the business this year for our all-new, robotic paint facility, we will continue to generate positive cash flow and are reaffirming our full-year Adjusted Free Cash Flow guidance of $24-$28 million.”
FISCAL 2019 THIRD QUARTER RESULTS
Net sales were $308.8 million for the third quarter of fiscal 2019, a decrease of $5.4 million, or 1.7 percent, from the prior-year period. Bus unit sales were 3,420 units for the quarter compared with 3,746 units for the same period last year.
Third-quarter gross profit of $41.8 million represented an increase of $4.8 million from the third quarter of last year. The gross profit margin improved 1.7 points to 13.5 percent.
Net income was $14.6 million for the third quarter of fiscal 2019, representing a decrease in profit of $7.3 million compared with the same period last year, more than accounted for by the non-recurrence of tax benefits realized in the third quarter of FY2018.
Adjusted Net Income
Adjusted Net Income was $18.3 million, representing a decrease of $7.9 million compared with the same period last year.
Adjusted EBITDA was $29.0 million, representing an increase of $4.9 million compared with the third quarter last year. Bus pricing and cost reductions more than offset the impact of commodity-cost headwinds and lower volume.
YEAR-TO-DATE 2019 RESULTS
Net sales were $675.3 million for the nine months ended June 29, 2019, which were a decrease of $18.0 million, or 2.6 percent, compared with the prior year. Bus unit sales were 7,291 units for the nine months ended June 29, 2019, compared with 7,892 units for the same period last year.
Year-to-date gross profit was $86.8 million, which was an increase of $7.6 million from the prior year.
Net income was $12.7 million for the nine months ended June 29, 2019, which was $3.2 million below the same period in the prior year.
Adjusted Net Income
Year-to-date Adjusted Net Income was $23.5 million, which represents a decrease of $7.0 million compared with the prior year. The decline is more than accounted for by the nonrecurrence of tax benefits that were realized in the third quarter of FY2018.
Adjusted EBITDA was $48.5 million for the nine months ended June 29, 2019, which was an increase of $7.2 million over the prior year.
Conference Call Details
Blue Bird will discuss its third quarter 2019 results and other related matters in a conference call at 4:30 PM ET today. Participants may listen to the audio portion of the conference call either through a live audio webcast on the company’s website or by telephone. The slide presentation and webcast can be accessed via the Investor Relations portion of Blue Bird’s website: www.blue-bird.com
Webcast participants should log on and register at least 15 minutes prior to the start time on the Investor Relations homepage of Blue Bird’s website at http://investors.blue-bird.com. Click the link in the events box on the Investor Relations landing page.
Participants desiring audio only should dial 800-263-0877 or 646-828-8143.
A replay of the webcast will be available approximately two hours after the call concludes via the same link on Blue Bird’s website.
About Blue Bird Corporation
Blue Bird is the leading independent designer and manufacturer of school buses, with more than 550,000 buses sold since its formation in 1927 and approximately 180,000 buses in operation today. Blue Bird’s longevity and reputation in the school bus industry have made it an iconic American brand. Blue Bird distinguishes itself from its principal competitors by its singular focus on the design, engineering, manufacture, and sale of school buses and related parts. As the only manufacturer of chassis and body production that are specifically designed for school bus applications, Blue Bird is recognized as an industry leader for school bus innovation, safety, product quality/reliability/durability, operating costs and drivability.
In addition, Blue Bird is the market leader in alternative fuel applications, with its propane-powered and compressed natural gas-powered school buses. Blue Bird manufactures school buses at two facilities in Fort Valley, Georgia. Its Micro Bird joint venture operates a manufacturing facility in Drummondville, Quebec, Canada. Service and after-market parts are distributed from Blue Bird’s parts distribution center in Delaware, Ohio. www.blue-bird.com