Alta Equipment Group Inc. · NYSE:ALTG
Alta Equipment — Q2 2021 Earnings Presentation
28 slides from Alta Equipment's earnings presentation, Aug 12, 2021
Slide 1: Second Quarter 2021 Earnings Presentation
Second Quarter 2021 Earnings Presentation August 12, 2021
Slide 2: Agenda
I. Introduction II. CEO Overview III. CFO Overview IV. Appendices Q2 2021 Earnings Presentation | 2
Slide 3: Legal Disclaimers
Legal Disclaimers Forward-Looking Information This presentation includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Alta’s actual results may differ from their expectations, estimates and projections and co
Slide 4: Participants
Introduction Participants Ryan Greenawalt, CEO Tony Colucci, CFO NICK HAGEN Q2 2021 Earnings Presentation | 4
Slide 5: Agenda: CEO Overview
I. Introduction II. CEO Overview III. CFO Overview IV. Appendices Q2 2021 Earnings Presentation | 5
Slide 6: Q2 2021 Highlights: Strong Financial Results in Improved Operating Environment
CEO Overview Q2 2021 Highlights Strong Financial Results in Improved Operating Environment ▪ Net revenue increased 52.4% to $292.7 million over the prior year with 23.5% organic growth ▪ Adjusted EBITDA grew 40.7% to $28.0 million compared to $19.9 million last year and $22.9 million in Q1’2021 ▪ St
Slide 7: Q2 2021 Highlights: Growing Momentum Moving into Second Half of 2021
CEO Overview Q2 2021 Highlights Growing Momentum Moving into Second Half of 2021 ▪ Third consecutive quarter with above average equipment sales drives future product support opportunities ▪ Proactive approach to recruiting skilled technicians in every serviceable region ▪ Supply constrained operatin
Slide 8: Alta Commercial EV Segment Launch
CEO Overview Alta Commercial EV Segment Launch Nikola Corporation, a leading designer and manufacturer of heavy-duty- commercial-battery-electric-vehicles (BEV), fuel cell electric vehicles (FCEV) and energy infrastructure solutions, has signed an agreement with Alta Equipment Group expanding their
Slide 9: Business Opportunities
CEO Overview Business Opportunities Material handling / warehousing Construction ✓ E-Commerce growth ✓ Increase in industrial production ⚫ Higher volumes driven by shift in consumer buying behavior ⚫ Driven by rise of e-Commerce and associated need for logistics systems and other ⚫ Increased complex
Slide 10: Company Overview
CEO Overview Company Overview Best-in-Class Brand Portfolio Creates Cross-Selling Opportunities Comprehensive Service Offering Across Heavy Equipment and Material Handling Products Select Equipment Offering: Material Handling & Warehousing Solutions Select Equipment Offering: Construction New and Us
Slide 11: Key Stakeholder Relationships
CEO Overview Key Stakeholder Relationships Collaborative OEM relationships Enhanced customer relationships ⚫ Consistently acknowledged ⚫ Provides equipment solutions as a top dealership partner to leading industrial and by OEMs construction businesses ⚫ Leading market share by ✓ Exclusive OEM ✓ “One
Slide 12: Expanding Footprint in Key Geographic Markets
CEO Overview Expanding Footprint in Key Geographic Markets Strategic Expansion ▪ 55 locations throughout Michigan, Indiana, Illinois, Massachusetts, Maine, New Hampshire, Connecticut, New York, Vermont, Florida, and Virginia ▪ Dealership platform with parts and service capabilities drives recurring
Slide 13: Product Support Overview
CEO Overview Product Support Overview Product Support Solutions We have capabilities to support all makes and models of Construction and Material Handling equipment. SERVICE PARTS ▪ 55 full-service ▪ Parts inventory of locations across 11 approx. $44 million states ▪ Electronically ▪ Approx. half of
Slide 14: Agenda: CFO Overview
I. Introduction II. CEO Overview III.CFO Overview IV. Appendices Q2 2021 Earnings Presentation | 14
Slide 15: Q2 2021 Financial Summary
CFO Overview Q2 2021 Financial Summary Q2 2021 Financial Summary Year over Year Comparisons ▪ Strong Performance Across All Departments ▪ Adjusted EBITDA of $28.0MM versus $19.9MM in Q2 2020, a 40.7% increase ▪ Adjusted Proforma EBITDA of $28.0MM versus $24.4MM in Q2 2020 ▪ Rental utilization and pr
Slide 16: Q2 2021 Financial Performance
CFO Overview Q2 2021 Financial Performance 2021 Quarter over Quarter Revenue / Gross Profit ($MM) Quarterly Year over Year $292.7 $76.9 ▪ Revenue grew 52.4% to $292.7MM ▪ Eight acquisitions completed since $192.1 $46.3 1/1/201 ▪ Organic Revenue increased $41.6MM, or 23.5% ▪ Organic Parts/Service rev
Slide 17: Q2 2021 Adjusted EBITDA / Cash Flow
CFO Overview Q2 2021 Adjusted EBITDA / Cash Flow Adj. EBITDA1 / Adj. PF EBITDA1 Quarterly Year over Year Q2 2021 Q2 2021 Adjusted EBITDA / Cash Flow $28.0 $28.0 Q2 2020 $24.4 ▪ Adjusted EBITDA improved by $8.1MM from Q2 2020 $19.9 $19.9MM to $28.0MM, or 40.7%, primarily related to impact of acquisit
Slide 18: Proforma ALTG Financial Profile
CFO Overview Proforma ALTG Financial Profile 2020 1H 2020 1H 2021 PF + TTM ($MM) 2018 2019 2020 PF+Acq1 PF+Acq1 Acq1 6/30/2021 Alta Revenue $413.0 $557.4 $873.6 $873.6 $372.6 $561.5 $1,062.5 Acquisitions Revenue - - - 164.5 75.9 1.7 90.3 Total Revenue $413.0 $557.4 $873.6 $1,038.1 $448.5 $563.2 $1,1
Slide 19: ALTG's Steady Performance in Supply Chain Constrained Market
CFO Overview ALTG’s Steady Performance in Supply Chain Constrained Market Supply Chain Impact on Department Commentary Constrained EBITDA • Supply chain constraints cause new equipment shortages and New extended lead times, impacting Alta’s ability to deliver new Equipment equipment to customers and
Slide 20: Acquisition Case Study: Alta Construction Equipment Florida LLC
CFO Overview Acquisition Case Study: Alta Construction Equipment Florida LLC Service Technician Growth Primary Acquisition Thesis 89 ▪ Alta Acquired Flagler Construction Equipment in Q1 of 2020, with the following thesis in mind: 63 ▪ Dealership was “under-technicianed” for the market size and Volvo
Slide 21: Business System Integration Drives Operating Efficiencies
CFO Overview Business System Integration Drives Operating Efficiencies Acquisition Integration 6 of 8 acquisitions integrated Flagler onto ERP ~90% of total branch Benefits activity and revenue ▪ Single source of Liftech on ERP information ▪ Shared inventory and customer data Hilo ▪ Consistent proce
Slide 22: April 2021 $315MM Bond Issuance Improves Capital Structure
CFO Overview April 2021 $315MM Bond Issuance Improves Capital Structure Current Impact Liquidity Cost Reduction Covenant Light Risk Avoidance Availability of ~$290MM Reduced incremental cost of Elimination of Eliminates Interest Rate capital Financial covenants Risk of a variable note Future Impact
Slide 23: Debt Structure and Maturity Runoff
CFO Overview Debt Structure and Maturity Runoff Commentary ▪ Ample liquidity and long-dated maturities provide financial flexibility ▪ Facilities committed for another 4.5 to 5 years ▪ Interest Rates: ABL L+175-225bps; HYB 5.625% ▪ No amortization of HYB ▪ HYB is callable beginning April 2023* Debt
Slide 24: Capital Structure / Credit Profile
CFO Overview Capital Structure / Credit Profile Credit Facility Proforma Capital Structure ($MM) 6/30/21 PF Post EV/Adj. EV/Adj. ▪ Liquidity has increased ~$10MM from Q1 to Q2 Bond PF EBITDA EBITDA Guidance 2021 Cash $1.8 ▪ Borrowing Base Increased ~$25MM Debt:1 ▪ ABL Draw increased ~$15MM Lines of
Slide 25: Agenda: Appendices
I. Introduction II. CEO Overview III. CFO Overview IV. Appendices Q2 2021 Earnings Presentation | 25
Slide 26: Adjusted EBITDA Reconciliation
Appendix A Adjusted EBITDA Reconciliation 6 months 6 months TTM ($MM) 2018 2019 2020 Q2 2020 Q2 2021 Ended Jun 30, Ended Jun 30, 6/30/2021 2020 2021 Net Income/(Loss) Available to Common Shareholders $1.5 ($35.4) ($24.0) ($4.1) ($15.7) ($21.1) ($21.4) ($24.3) Depreciation and Amortization 37.1 50.1
Slide 27: Free Cash Flow Reconciliation
Appendix B Free Cash Flow Reconciliation 6 months 6 months TTM ($MM) 2018 2019 2020 Ended Jun 30, Ended Jun 30, 6/30/2021 2020 2021 Net Income/(Loss) Available to Common Shareholders $1.5 ($35.4) ($24.0) ($21.1) ($21.4) ($24.3) Depreciation and Amortization 37.1 50.1 75.0 30.6 44.8 89.2 Interest Exp
Slide 28: Free Cash Flow Reconciliation – Capital Expenditure Detail
Appendix B (cont.) Free Cash Flow Reconciliation – Capital Expenditure Detail 6 months 6 months TTM ($MM) 2018 2019 2020 Ended Jun Ended Jun 6/30/2021 30, 2020 30, 2021 Replacement of Sold Rental Equipment, at Original Cost 1,2 $57.3 $56.9 $105.4 $35.9 $78.7 $148.2 3 Capitalized Costs to Maintain Fl