REV Group Inc (REVG) Delivers Robust Fiscal 2023 Q4 and Full Year Results; Sets Positive ...
Q4 net sales increased by 11.2% to $693.3 million; Full year net sales up 13.1% to $2,638.0 million.
Q4 net income rose to $29.7 million; Full year net income grew to $45.3 million.
Adjusted EBITDA for Q4 reached $54.0 million; Full year Adjusted EBITDA at $156.6 million.
Fiscal 2024 guidance anticipates net sales between $2.6 billion and $2.7 billion, with net income projected between $71 million and $90 million.
On December 13, 2023, REV Group Inc (NYSE:REVG) released its 8-K filing, announcing strong financial results for the fourth quarter and full year of fiscal 2023. The company's performance reflects significant growth in net sales and profitability, with substantial contributions from its Fire & Emergency (F&E) and Commercial segments.
Financial Performance Overview
REV Group Inc (NYSE:REVG) reported an 11.2% increase in Q4 net sales, reaching $693.3 million, and a 13.1% rise in full year net sales to $2,638.0 million. This growth was primarily driven by higher net sales in the F&E and Commercial segments, which offset a decrease in the Recreation segment.
The company's net income for Q4 soared to $29.7 million, a significant jump from $8.7 million in the same quarter last year. Full year net income also increased to $45.3 million, up from $15.2 million in the previous year. Adjusted EBITDA for Q4 was $54.0 million, compared to $33.5 million in Q4 of the prior year, while full year Adjusted EBITDA reached $156.6 million, up from $105.1 million.
Segment Highlights and Backlog
The F&E segment saw a remarkable increase in net sales to $339.1 million in Q4, driven by higher shipments and favorable pricing. The segment's backlog stood at $3,649.8 million, a 41% increase year-over-year, signaling strong demand and order intake.
The Commercial segment also experienced growth, with net sales rising to $139.7 million in Q4, primarily due to increased school bus shipments. However, the segment's backlog decreased to $426.9 million, reflecting higher production and shipment activity.
Conversely, the Recreation segment faced a decline, with net sales dropping to $215.2 million in Q4, attributed to fewer unit shipments and increased discounting. The segment's backlog also decreased significantly to $385.2 million.
Balance Sheet and Cash Flow
REV Group Inc (NYSE:REVG) ended the fiscal year with a strong balance sheet, including $21.3 million in cash and cash equivalents and a net debt of $128.7 million. The company's trade working capital was reduced to $318.5 million, down from $347.8 million the previous year, due to an increase in accounts payable and customer advances.
Fiscal 2024 Outlook and Dividend
Looking ahead, REV Group Inc (NYSE:REVG) provided an optimistic outlook for fiscal 2024, with net sales expected to be between $2.6 billion and $2.7 billion, and net income projected between $71 million and $90 million. Adjusted EBITDA is anticipated to be between $165 million and $185 million, with free cash flow projected between $70 million and $85 million.
The company's board of directors declared a quarterly cash dividend of $0.05 per share of common stock, payable on January 12, 2024, to shareholders of record on December 26, 2023.
Management Commentary
We are pleased to deliver strong fourth quarter and full year results which are a testament to the progress of the operational initiatives we have put in place over the past few quarters, and the hard work of our dedicated employees," said Mark Skonieczny, President and CEO of REV Group Inc (NYSE:REVG). "We exited our 2023 fiscal year with a strong balance sheet, solid municipal end markets, and a record Fire & Emergency backlog which we believe positions us for continued growth in fiscal 2024."
REV Group Inc (NYSE:REVG) remains focused on leveraging its operational initiatives and strong market position to drive growth and deliver value to shareholders in the coming fiscal year.
For a detailed analysis of REV Group Inc (NYSE:REVG)'s financial results, including reconciliations of non-GAAP measures, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from REV Group Inc for further details.
This article first appeared on GuruFocus.
