Spartan Motors Inc. reported third-quarter sales increased $62.8 million, or 27.8%, to a record $289 million from $226.2 million in the year-ago period. During the quarter, ended Sept. 30, net income increased $5.1 million, or 97.5%, to $10.4 million, or 29 cents per share, compared to $5.2 million, or 15 cents per share.
Other third-quarter highlights include:
- Gross profit margin improved 300 basis points to 14.6% of sales from 11.6% of sales.
- Adjusted net income increased $6.3 million, or 106%, to $12.3 million, or 35 cents per share, from $6 million, or 17 cents per share.
- Adjusted EBITDA increased $8.6 million, or 81.4%, to $19.2 million, or 6.6% of sales, from $10.6 million, or 4.7% of sales.
- Acquired Royal Truck Body, which further expands Spartan’s geographic coverage with six additional manufacturing facilities located in California, Arizona, and Texas.
- Consolidated backlog at Sept. 30, 2019, totaled $458.8 million, up $132.9 million, or 41%, compared to $325.9 million at September 30, 2018, which excludes the one-time multi-year USPS truck body order. The increase was primarily driven by strong demand for delivery vehicles in all vehicle classes and the Royal acquisition.
“Spartan’s record third-quarter sales led to strong overall results for the quarter, underscoring our growth strategy through both organic and acquisitions. The continued demand for delivery vehicles in all of our vehicle classes is driving our growth,” said president and CEO Daryl Adams. “Overall, we expanded margins through lower material costs and continue to pursue innovation and optimization within our manufacturing processes. Additionally, we have added eight manufacturing facilities in the past 10 months as part of our strategy to offer coast-to-coast manufacturing and distribution capabilities.”
The company’s Specialty Chassis and Vehicles (SCV) segment remains, which included results from Royal Truck Body, reported that sales decreased $6.6 million, or 12.7%, to $45.1 million from $51.7 million a year ago. The revenue decrease was mainly due to lower luxury motorcoach chassis and the completion of the Reach vehicle order.
Adjusted EBITDA decreased $1.8 million to $4.1 million, or 9.0% of sales, from $5.9 million, or 11.4% of sales, a year ago, mainly due to volume, mix, and manufacturing disruption due to an OEM strike.