WINNIPEG,
July 15, 2013 /CNW/ - (TSX:NFI;
TSX:NFI.DB.U) New Flyer Industries Inc. ("New Flyer" or the
"Company"), the leading manufacturer of heavy-duty transit buses in
Canada and the United States, announced its order
activity and backlog update for the second fiscal quarter ended
June 30, 2013 ("Q2 2013").
The order and delivery activity and backlog for
Q22013 reported herein does not include any activity from North
American Bus Industries, Inc., now called NABI Bus LLC ("NABI
Bus"), which was acquired by New Flyer on June 21, 2013. The Company is currently
reviewing all active contracts contributing to the reported NABI
Bus total backlog of 1,579 equivalent units ("EUs") (of which 593
were firm and 986 were options). The Company will synchronize
and ensure consistent classification and reporting practices for
the combined backlog commencing with the Q2 2013 reporting period
including Management's Discussion and Analysis of Financial
Condition and Results of Operations ("MD&A") and the related
earnings press release. Management expects NABI Bus to build at an
average line entry rate of approximately 12 EUs per production week
at the Anniston, Al production
facilities for the remainder of fiscal 2013.
Order Activity, Option Expiry and
Deliveries
New orders (firm and options) for New Flyer in
Q2 2013 totaled 513 EUs, an increase from just 90 EUs in second
fiscal quarter ended July 1, 2012
("Q2 2012").
- New firm orders were received for 253 EUs (valued at
$108.7 million)
- New options in Q2 2013 were received for 260 EUs (valued at
$115.4 million).
- In addition, New Flyer was successful at converting options for
38 EUs (valued at $17.6 million) in
Q2 2013.
(EUs) |
New Orders
(Firm and
Options) |
LTM New Orders
(Firm and
Options) |
Option
Conversions |
LTM Option
Conversions |
Q2 2012 |
90 |
229 |
408 |
1,036 |
Q3 2012 |
447 |
574 |
224 |
932 |
Q4 2012 |
1,055 |
1,620 |
190 |
970 |
Q1 2013 |
2,004 |
3,596 |
224 |
1,046 |
Q2 2013 |
513 |
4,019 |
38 |
676 |
New Flyer delivered 474 EUs in Q2 2013, an
increase of 33 EUs over the 441 EUs delivered in Q2 2012. The total
New Flyer backlog combined with the recent order intake is expected
to enable the Company to continue to build at an average line entry
rate of approximately 36 EUs per production week at the New Flyer
production facilities for fiscal 2013.
In Q2 2013, a total of 174 option EUs expired,
related to three contracts which reached the end of their
respective contract terms. The maximum term for a contract
permitted by the US Federal Transit Administration is five
years. Remaining options included in the New Flyer backlog
will expire, if not exercised, as follows:
Year of option expiry |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
Total Options |
Remaining Option (EUs) |
2,415 |
1,117 |
497 |
99 |
545 |
1003 |
5,676 |
Note that 1,520 of the options that are eligible
to expire in December 2013 relate to
the deferred customer order added to the backlog in 2008.
New Flyer Book-to-Bill ratio (defined as new
order intake - both firm and options - divided by deliveries in the
quarter) was 232% over the last twelve months. Consistent
with the backlog reporting, the Book-to-Bill ratio does not include
the activity of the company's newly acquired subsidiary NABI
Bus.
At the end of the period, new firm and option
orders of 50 buses (100 EUs) for New Flyer were pending from a
number of customers where approval had been granted by the
customer's board, council, or commission, as applicable, but
purchase documentation had not yet been received by the Company and
therefore not yet included in the backlog.
In addition to these pending orders, the Company
was advised in the week following the end of Q2 2013 of the
following upcoming awards:
- New Flyer has been selected by a major US public transit agency
to provide up to 350 40' and up to 180 60' electric trolley
Xcelsior buses (a total of up to 710 EUs). The agency has
issued New Flyer a letter of Intent to Award, and has commenced all
pre-award audits. Once all required approvals and audits are
completed, a notice to proceed ("NTP") will be issued, at which
time New Flyer will add the order to the backlog and issue a press
release.
- NABI Bus has been selected by a major US public transit agency
to provide up to 238 40' diesel-electric hybrid BRT buses, up to
370 40' CNG BRT buses, and up to 71 60' diesel-electric hybrid BRT
buses (a total of up to 750 EUs). The agency has issued NABI
a letter of Intent to Award, and has completed pre-award
audits. Once all required documentation is complete, a NTP
will be issued, at which time New Flyer will add the order to the
backlog and issue a press release.
Total Backlog
At the end of Q2 2013, New Flyer's total backlog
decreased to 7,392 EUs (for a total value of $3.25 billion) which is a decrease of 1.8% from
the backlog at the end of the first quarter of 2013 ("Q1 2013").
The firm backlog includes 65 EUs from five different customers
where orders and contract documentation was received prior to the
end of Q2 2013 but announcements outlining the details of these
contracts are awaiting customer approval prior to release.
Total Backlog
(EUs) |
2013 (Current
Year) |
Firm Orders
(EUs) |
Options
(EUs) |
Ending backlog: Q1-13
New orders in Q2-13
Options exercised in Q2-13
Deliveries in Q2-13
Cancelled/Expired options in Q1-13 |
1,899
253
38
(474)
- |
5,628
260
(38)
-
(174) |
Ending Backlog: Q2-13 |
1,716 |
5,676 |
New Flyer's backlog consists of the following
mix of bus lengths, with clean propulsion vehicles (such as,
electric-hybrid, electric-trolley, CNG, LNG, and all-electric),
representing approximately 75% of the total:
|
Firm EUs |
Option EUs |
Total |
35 and 40 foot heavy-duty buses |
1,082 |
2,966 |
4,048 |
60 foot heavy-duty articulated buses |
634 |
2,710 |
3,344 |
Total Backlog |
1,716 |
5.676 |
7,392 |
New Flyer Bid Universe
The bid universe was created by New Flyer in
2008 as an indicator for overall transit bus market demand and
active bids. The bid universe is a point-in-time snapshot of
the estimated EUs for: all requests for proposals ("RFPs") received
and in process of review at New Flyer, bids or proposals submitted
by New Flyer awaiting customer action, and management forecast of
all expected EUs to be placed out for competition over the next
five years. Unlike the order and backlog activity, the New
Flyer bid universe has been reconciled with NABI's bid universe and
approximately 300 additional EUs were added in Q2 2013.
|
RFPs (EUs) in
Process at NFI |
Bids or
Proposals
(EUs)
Submitted by
NFI |
Forecasted New
Procurements (EUs)
over the next 5 years |
Total EUs |
Q2 2012 |
2,156 |
4,574 |
8,454 |
15,184 |
Q3 2012 |
3,334 |
2,542 |
11,854 |
17,730 |
Q4 2012 |
4,214 |
4,626 |
10,613 |
19,453 |
Q1 2013 |
3,173 |
4,145 |
7,917 |
15,235 |
Q2 2013 |
3,620 |
4,869 |
9,608 |
18,097 |
Management believes that the transit bus market
continues to show positive signs of recovery. The total number of
active EUs where RFPs were received and in process of review at New
Flyer, and bids or proposals submitted by New Flyer awaiting
customer action at the end of Q2 2013 remains high at 8,489 EUs,
compared to 7,318 EUs at the end of Q1 2013.
Management also remains encouraged with US
general economic health improvement with preliminary data from the
Rockefeller Institute (Data Alert on June 5,
2013) reporting State tax collections increasing in the
first quarter of 2013 for the 13th consecutive quarter,
with a 9.3% increase over the prior year.
The latest data from the American Public
Transportation Association's (APTA) ridership report indicated a
decrease of 1.91% in all modes of U.S. transit ridership during Q1
2013 compared with the previous year; and a decrease in bus
ridership of 2.17%. The same report indicates Canadian
ridership decreased by 2.62% in all modes of transit ridership
during the first quarter of 2013 as compared to the previous
year.
New Flyer Aftermarket
Gross orders received by New Flyer's aftermarket
business during Q2 2013 for core parts sales increased 49% compared
to Q2 2012, while shipments in Q1 2013 increased 17.1% over Q1
2012. Order intake in Q2 2013 has been significantly impacted
as ramp up for the previously announced Chicago Transit Authority
Midlife Overhaul program begins in earnest and orders from the
Orion parts business, which was acquired in the first quarter of
2013, are included in the aftermarket order intake.
Q2 2013 orders also rose 18.9% over Q1 2013 and
shipments were up 6.9% over Q1 2013. Management continues to
experience a challenging price environment.
Similar to the NABI Bus order and backlog
activity, New Flyer will synchronize and ensure consistent
classification and reporting practices for the combined aftermarket
orders and shipments commencing with the Q2 2013 reporting period
including the MD&A and the related press release.
NOTE: All dollar amounts are stated in US
currency based on an exchange rate of US $1.00 = CAD $1.0518
to calculate the value of the Canadian contracts in this
release.
About New Flyer
New Flyer is a leading manufacturer of
heavy-duty transit buses in the United
States and Canada.
The Company is the industry technology leader and offers the
broadest product line including drive systems powered by: clean
diesel, natural gas and electric trolley as well as
energy-efficient diesel-electric hybrid vehicles. All buses
are supported by an industry-leading comprehensive warranty and
support program, and service network. New Flyer and its
recently acquired subsidiary NABI, also operate the transit
industry's most sophisticated aftermarket parts organization,
sourcing parts from hundreds of different suppliers and providing
support for all types of heavy-duty transit buses.
Together New Flyer and NABI employ over 3,000
team members with manufacturing, fabrication, parts distribution
and service centers in both Canada
and the United States.
Further information is available on New Flyer's web site at
www.newflyer.com.
Forward-Looking Statements
This press release may contain forward-looking
statements relating to expected future events and financial and
operating results of the Company that involve risks and
uncertainties. Although the forward-looking statements contained in
this press release are based upon what management believes to be
reasonable assumptions, investors cannot be assured that actual
results will be consistent with these forward-looking statements,
and the differences may be material. Actual results may differ
materially from management expectations as projected in such
forward-looking statements for a variety of reasons, including
market and general economic conditions and economic conditions of
and funding availability for customers to purchase buses and to
purchase parts or services, customers may not exercise options to
purchase additional buses, the ability of customers to terminate
contracts for convenience and the other risks and uncertainties
discussed in the materials filed with the Canadian securities
regulatory authorities and available on SEDAR at www.sedar.com. Due
to the potential impact of these factors, the Company disclaims any
intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, unless required by applicable law.
SOURCE New Flyer Industries Inc.