FALSE000089707700008970772024-02-222024-02-22

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 
 
Date of Report (Date of earliest event reported): February 22, 2024
 
Alamo Group Inc.
(Exact name of registrant as specified in its charter)
 
State of Delaware
0-2122074-1621248
(State or other jurisdiction of incorporation)(Commission File No.)(IRS Employer Identification No.)
  
1627 E. Walnut, Seguin, Texas
78155
(Address of Registrant’s principal executive offices)(Zip Code)
 
(830) 379-1480
Registrant's telephone number, including area code:
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, par value
$.10 per share
ALGNew York Stock Exchange

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) 
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) 
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) 
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of
the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter).Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the
extended transition period for complying with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02    Results of Operations and Financial Condition
On February 22, 2024, Alamo Group Inc. issued a press release announcing, among other things, financial results for the fourth quarter and year ended December 31, 2023.  A copy of the press release is filed as Exhibit 99.1 to this Current Report on Form 8-K. The foregoing description is qualified by reference to such exhibit.
The information furnished in this report, including the exhibit, shall not be deemed to be incorporated by reference into any of Alamo Group filings with the SEC under the Securities Act of 1933, except as shall be expressly set forth by specific reference in any such filing, and shall not be deemed to be "filed" with the SEC under the Securities Exchange Act of 1934.

Item 9.01    Financial Statements and Exhibits
Exhibit 99.1 - Press Release dated February 22, 2024.


SIGNATURES
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
February 22, 2024
By:/s/ Edward T. Rizzuti
 Edward T. Rizzuti,
 EVP, General Counsel & Secretary
 
 
 
 


EXHIBIT INDEX
 
Exhibit No.
Description
 
99.1
104Cover Page Interactive Data File - Inline XBRL for the cover page of this Current Report on Form 8-K




logo20for20filing.jpg
For:Alamo Group Inc.
                                                                              
Contact:Richard Wehrle
 Executive Vice President & CFO
 830-372-9615
  
 Financial Relations Board
 Joe Calabrese
 212-827-3772

ALAMO GROUP ANNOUNCES RECORD 2023
FOURTH QUARTER AND YEAR END RESULTS

SEGUIN, Texas, February 22, 2024 -- Alamo Group Inc. (NYSE: ALG) today reported results for the fourth quarter and year ended December 31, 2023.

Highlights
•Ninth consecutive quarterly record for sales and earnings
•Fourth quarter net sales of $417.5 million, up 8%
•Fourth quarter operating income of $44.8 million, up 5%
•Fourth quarter net income of $31.5 million, or $2.63 per diluted share, up 8%
•Full year net sales of $1.69 billion, up 12%
•Full year operating income of $198.0 million, up 33%
•Full year net income of $136.2 million, up 34%
•Full year diluted EPS was $11.36, up 33%
•Record EBITDA of $246.6 million, up 26%
•Year-end 2023 backlog at $860 million

Fourth Quarter Results

Fourth quarter 2023 net sales were $417.5 million compared to $386.6 million in the fourth quarter of 2022, an increase of 8%. Gross margin improved in the quarter versus the fourth quarter of 2022 by $11.1 million or 11%. Fourth quarter net income improved


ALAMO GROUP ANNOUNCES 2023 FOURTH QUARTER AND YEAR END RESULTS PAGE 2
8% to $31.5 million, or $2.63 per diluted share, compared to net income of $29.2 million, or $2.44 per diluted share in the fourth quarter of 2022. The Company’s backlog at the end of 2023 was $860 million.
Full Year Results
Full year 2023 net sales increased to almost $1.7 billion, up 12% compared to $1.5 billion for the full year 2022. Gross margin for 2023 increased $77.1 million or 20% versus the full year 2022. Net income for 2023 was $136.2 million, or $11.36 per diluted share, compared to net income of $101.9 million, or $8.54 per diluted share in 2022, a year-over-year EPS improvement of 33%.

Comments on Results

Jeff Leonard, Alamo Group’s President, and Chief Executive Officer, commented, “We are pleased that our fourth quarter results established new records for sales and earnings for the ninth consecutive quarter. The fourth quarter is normally seasonally softer for us, and this year was no exception as sales growth moderated relative to the pace set in the third quarter.

“It was great to see that our fourth quarter gross margin expanded by 80 basis points reflecting the durable quality of our backlog. Improvements in supply chain performance and labor availability drove operating efficiency higher and contributed to the favorable gross margin. The combined benefits of the higher gross margin and better operating efficiency were partially offset by higher employee-related administrative expenses during the quarter. Fourth quarter operating income of $44.8 million was five percent higher than the comparison period of 2022.

“The Industrial Equipment Division had a very strong fourth quarter with sales that were 32% higher than the fourth quarter of 2022. Governmental and industrial demand for this Division’s products remained robust although order bookings were 9% lower due to a challenging comparable caused by an unusually large snow-removal equipment order that we received in the fourth quarter of 2022. Year-end backlog increased by 18% compared to 2022.




ALAMO GROUP ANNOUNCES 2023 FOURTH QUARTER AND YEAR END RESULTS PAGE 3

“The Vegetation Management Division faced challenging conditions in several of its markets in the fourth quarter. Forestry and Tree Care activity remained constrained by the combined effects of price pressure for domestic wood pellets, slowing demand for land
clearing equipment and sluggish housing starts. The farm and ranch market also remained soft due to lower cattle prices, less favorable commodity prices and declining agricultural exports. Channel inventories remained above optimal levels in the fourth quarter and dealers were reluctant to place new stock orders while interest rates remained elevated. The bright spot in the Vegetation Management Division was its governmental mowing business which enjoyed very strong, historically high sales in the fourth quarter and for all of 2023. Vegetation Management Division fourth quarter order bookings declined 34% and year-end backlog was 39% lower compared to 2022. The Division’s backlog has now returned to a more normal level from a historical perspective.

“The Company’s solid performance in the fourth quarter capped a very strong performance in 2023. Full-year sales were up 12% and net income improved by 34% versus the prior year. As we expected, recent softness in several of the Vegetation Management Division’s markets was largely offset by increasing demand for the Company’s Industrial Equipment from governmental agencies and contractors. We continue to like the way the Company is positioned as we enter 2024. At nearly $860 million, the Company’s backlog remains at a very healthy level and we believe that the quality of the backlog remains excellent. Although the noted softness in Vegetation Management may persist through the first quarter, anticipated relief in the form of modestly lower interest rates later in the year should help clear the inventory overhang and invigorate dealer demand. We expect that the Industrial Equipment Division will continue to display strength in 2024 driven by its sales to governmental agencies. Taken together, we remain confident regarding the Company’s performance in 2024 and believe it will be another excellent year for us.


ALAMO GROUP ANNOUNCES 2023 FOURTH QUARTER AND YEAR END RESULTS PAGE 4

Earnings Conference Call
The Company will host a conference call to discuss fourth quarter and year end 2023 financial results on Friday, February 23, 2024 at 10:00 a.m. ET. Hosting the call will be members of senior management.

Individuals wishing to participate in the conference call should dial 877-317-6789 (domestic) or 412-317-6789 (international). For interested individuals unable to join the call, a replay will be available until Friday, March 01, 2024 by dialing 877-344-7529 (domestic) or 412-317-0088 (internationally), passcode 8022529.

The live broadcast of Alamo Group Inc.’s quarterly conference call will be available online at the Company's website, www.alamo-group.com (under “Investor Relations/Events & and Presentations”) on Friday, February 23, 2024, beginning at 10:00 a.m. ET. The online replay will follow shortly after the call ends and will be archived on the Company’s website for 60 days.
About Alamo Group
Alamo Group is a leader in the design, manufacture, distribution and service of high quality equipment for vegetation management, infrastructure maintenance and other applications. Our products include truck and tractor mounted mowing and other vegetation maintenance equipment, street sweepers, snow removal equipment, excavators, vacuum trucks, other industrial equipment, agricultural implements, forestry equipment and related after-market parts and services. The Company, founded in 1969, has approximately 4,350 employees and operates 29 plants in North America, Europe, Australia and Brazil as of December 31, 2023. The corporate offices of Alamo Group Inc. are located in Seguin, Texas.



ALAMO GROUP ANNOUNCES 2023 FOURTH QUARTER AND YEAR END RESULTS PAGE 5

Forward Looking Statements
This release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company’s actual results in future periods to differ materially from forecasted results. Among those factors which could cause actual results to differ materially are the following: adverse economic conditions which could lead to a reduction in overall market demand, supply chain disruptions, labor constraints, increasing costs due to inflation, disease outbreaks, geopolitical risks, including effects of the war in the Ukraine and the Middle East, competition, weather, seasonality, currency-related issues, and other risk factors listed from time to time in the Company’s SEC reports. The Company does not undertake any obligation to update the information contained herein, which speaks only as of this date.
(Tables Follow)
# # #
(1) This is a non-GAAP financial measure or other information relating to our GAAP financial measures that we have provided to investors in order to allow greater transparency and a deeper understanding of our financial condition and operating results.  For a reconciliation of the non-GAAP financial measure or for a more detailed explanation of financial results, refer to “Non-GAAP Financial Measure Reconciliation” below and the Attachments thereto.



PAGE 6
Alamo Group Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands)
(Unaudited) 
December 31,
2023		December 31,
2022
ASSETS 
Current assets:  
Cash and cash equivalents$51,919 $47,016 
Accounts receivable, net362,007 317,581 
Inventories377,480 352,553 
Other current assets12,551 10,060 
Total current assets803,957 727,210 
Rental equipment, net39,264 33,723 
Property, plant and equipment166,660 155,007 
 
Goodwill206,536 195,858 
Intangible assets168,296 171,341 
Other non-current assets24,673 25,369 
Total assets$1,409,386 $1,308,508 
LIABILITIES AND STOCKHOLDERS’ EQUITY  
Current liabilities:  
Trade accounts payable$99,678 $97,537 
Income taxes payable12,529 6,592 
Accrued liabilities86,711 71,368 
Current maturities of long-term debt and finance lease obligations15,008 15,009 
Total current liabilities213,926 190,506 
Long-term debt, net of current maturities220,269 286,943 
Long term tax payable2,634 3,781 
Other long-term liabilities23,694 23,668 
Deferred income taxes16,100 18,250 
Total stockholders’ equity932,763 785,360 
Total liabilities and stockholders’ equity$1,409,386 $1,308,508 
                                                                       



PAGE 7
Alamo Group Inc. and Subsidiaries 
Condensed Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
 Fourth Quarter EndedYear Ended
12/31/202312/31/202212/31/202312/31/2022
Net sales:    
  Vegetation Management$214,357 $232,545 $979,040 $937,065 
  Industrial Equipment203,185 154,059 710,611 576,551 
Total Net Sales417,542 386,604 1,689,651 1,513,616 
Cost of Sales308,622 288,809 1,236,007 1,137,098 
Gross Margin108,920 97,795 453,644 376,518 
 26.1 %25.3 %26.8 %24.9 %
Selling, general and administration expense60,068 51,282 240,158 212,649 
Amortization Expense4,054 3,796 15,519 15,277 
Income from Operations44,798 42,717 197,967 148,592 
 10.7 %11.0 %11.7 %9.8 %
Interest Expense(6,587)(4,791)(26,093)(14,361)
Interest Income360 530 1,485 752 
Other Income1,667 (200)1,761 (673)
Income before income taxes40,238 38,256 175,120 134,310 
Provision for income taxes8,715 9,091 38,959 32,382 
Net Income$31,523 $29,165 $136,161 $101,928 
Net Income per common share:    
Basic$2.64 $2.45 $11.42 $8.58 
Diluted$2.63 $2.44 $11.36 $8.54 
Average common shares:    
Basic11,930 11,884 11,920 11,877 
Diluted12,000 11,940 11,987 11,934 


PAGE 8
Alamo Group Inc.
Non-GAAP Financial Measures Reconciliation

From time to time, Alamo Group Inc. may disclose certain “non-GAAP financial measures” in the course of its earnings releases, earnings conference calls, financial presentations and otherwise. For these purposes, “GAAP” refers to generally accepted accounting principles in the United States. The Securities and Exchange Commission (SEC) defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial position, or cash flows that is subject to adjustments that effectively exclude or include amounts from the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures disclosed by Alamo Group are provided as additional information to investors in order to provide them with greater transparency about, or an alternative method for assessing, our financial condition and operating results. These measures are not in accordance with, or a substitute for, GAAP and may be different from, or inconsistent with, non-GAAP financial measures used by other companies. Whenever we refer to a non-GAAP financial measure, we will also generally present the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable GAAP financial measure.

Attachment 1 discloses a non-GAAP financial presentation related to the impact of currency translation on net sales by division. Attachment 2 shows the net change in our total debt net of cash and earnings before interest, taxes, depreciation and amortization ("EBITDA") which is a non-GAAP financial measure. The Company considers this information useful to investors to allow better comparability of period-to-period operating performance. Attachment 3 reflects Division performance inclusive of non-GAAP financial measures such as backlog and earnings before interest, tax, depreciation and amortization ("EBITDA").

PAGE 9
Attachment 1

Alamo Group Inc.
Non-GAAP Financial Reconciliation
(in thousands)
(Unaudited)
Impact of Currency Translation on Net Sales by Division
Three Months Ended
December 31,		Change due to currency translation
20232022% change from 2022$%
Vegetation Management$214,357 $232,545 (7.8)%$2,384 1.0 %
Industrial Equipment203,185 154,059 31.9 %861 0.6 %
   Total Net Sales$417,542 $386,604 8.0 %$3,245 0.8 %
Twelve Months Ended December 31,Change due to currency translation
20232022% change from 2022$%
Vegetation Management$979,040 $937,065 4.5 %$1,663 0.2 %
Industrial Equipment710,611 576,551 23.3 %(1,961)(0.3)%
   Total Net Sales$1,689,651 $1,513,616 11.6 %$(298)— %


PAGE 10
Attachment 2

Alamo Group Inc.
Non-GAAP Financial Reconciliation
(in thousands)
(Unaudited)
Consolidated Net Change of Total Debt, Net of Cash
December 31, 2023December 31, 2022Net Change
Current maturities $15,008 $15,009 
Long-term debt, net of current220,269 286,943 
Total Debt$235,277 $301,952 
Total Cash51,919 47,016 
     Total Debt Net of Cash$183,358 $254,936 $71,578 
EBITDA
Twelve Months Ended
December 31, 2023December 31, 2022
Income from operations$197,967 $148,592 
Depreciation 32,454 31,412 
Amortization16,222 15,944 
     EBITDA$246,643 $195,948 
Adjusted EBITDA


PAGE 11
Attachment 3

Alamo Group Inc.
Non-GAAP Financial Reconciliation
(in thousands)
(Unaudited)


Vegetation Management Division Performance
Three Months Ended
December 31,		Twelve Months Ended   December 31,
2023202220232022
Backlog$352,080 $577,050 
Net Sales214,357 232,545 979,040 937,065 
Income from Operations19,764 30,247 122,084 108,508 
9.2 %13.0 %12.5 %11.6 %
Depreciation4,246 4,470 15,581 15,188 
Amortization3,031 3,005 12,155 12,193 
EBITDA27,041 37,722 149,820 135,889 
12.6 %16.2 %15.3 %14.5 %


Industrial Equipment Division Performance
Three Months Ended
December 31,		Twelve Months Ended   December 31,
2023202220232022
Backlog$507,715 $429,439 
Net Sales203,185 154,059 710,611 576,551 
Income from Operations25,034 12,470 75,883 40,084 
12.3 %8.1 %10.7 %7.0 %
Depreciation4,534 4,970 16,873 16,224 
Amortization1,199 958 4,067 3,751 
EBITDA30,767 18,398 96,823 60,059 
15.1 %11.9 %13.6 %10.4 %

v3.24.0.1
Cover
Feb. 22, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 22, 2024
Entity Registrant Name Alamo Group Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 0-21220
Entity Tax Identification Number 74-1621248
Entity Address, Address Line One 1627 E. Walnut
Entity Address, City or Town Seguin
Entity Address, State or Province TX
Entity Address, Postal Zip Code 78155
City Area Code 830
Local Phone Number 379-1480
Title of 12(b) Security Common Stock, par value$.10 per share
Trading Symbol ALG
Security Exchange Name NYSE
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000897077
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