Alta Equipment Group in 2023 grew its revenue 19.4% year over year to $1.9 billion, thanks to increased sales of new and used equipment and expanding profits in its construction, material handling and rental segments.
The Livonia, Mich.-based machinery manufacturer said in a filing today that it saw supply chain constraints subside slightly in 2023, allowing it to better meet demand.
“The momentum in our business continued throughout the balance of 2023, and as a result, we delivered solid financial and operating results for the fourth quarter and 2023 fiscal year,” Ryan Greenawalt, chief executive officer of Alta, said in an earnings statement today.
By the numbers
- Net income was $8.9 million, down 4.3% YoY;
- New and used equipment sales grew 25.1% to $1 billion annually;
- Fourth-quarter sales were up $44.5 million; up 21.7% over Q4 2022;
- Rental revenue for all segments increased 22.3% annually to $202.4 million;
- Product support, including parts and service revenue, increased 17.7% annually to $519.6 million;
- Construction revenue grew 12.9% annually to $1.1 billion;
- Material handling new and used equipment sales grew 15% YoY to $344.9 million;
- Material handling rental revenues were $63 million, up 7.3% from the previous year; and
- Material handling overall annual revenue was $681.5 million.
Alta began reporting master distribution, its environmental processing division, as its own segment in the first quarter of 2023, after acquiring it in Q4 2022. For 2023, new and used master distribution sales were $72.5 million. Total revenue for the segment was $83.8 million in 2023.
New- and used-equipment sales made up roughly 55% of the company’s overall revenue. Parts sales were 14.8% of revenue in 2023, while rental revenues were 10.8% and rental equipment sales were 6.9% of the total.
As inventory supply chain constraints eased, Alta Group was able to capitalize on deliveries. The company said in its SEC filing that its ability to begin taking delivery of new equipment from OEMs throughout the year was the “primary driver” of its $25.5% increase in overall new and used equipment sales in 2023.
“One of our key priorities remains providing our customers with best-in-class support to keep their fleets and job sites running with as little downtime as possible,” Greenawalt said. “We continued to expand our field service population, ending the year with more than 1,300 skilled technicians, which represents nearly half of our 3,000 employees.”
Acquisitions abound
Alta Group acquired four businesses during the last two years, as it continued to execute its plan to expand its footprint and diversify its supplier and customer chains.
Throughout 2022 and 2023, Alta Group bought:
- Chicago-based construction and turf equipment distributor Burris Equipment Co. for $16.7 million;
- East Providence, R.I.-based M&G Materials Handling Co. and Dracut, Mass.-based Battery Shop of New England. Alta Group purchased these assets for a combined $2.6 million;
- Ault Industries, a Quebec-based crushing and screening distributor, which marked Alta Group’s first expansion into Canada and cost the company $38 million;
- Yale Industrial Trucks, a London, Ontario-based distributor, for $40.6 million; and
- Ecoverse, an Avon, Ohio-based environmental processing equipment seller with a network of 15 North American dealers, for $58.1 million.
“Our outlook for 2024 is positive, as industry indicators support our expectations for continued growth this year,” Greenawalt said. The 2024 budgets for state departments of transportation are up 10% from last year, indicating more potential need for Alta’s equipment, he added.
“Importantly, the sentiment from our customers is consistent with the strength we experienced in 2023,” Greenawalt said.
Shares of Alta Equipment Group (NYSE: ALTG) were trading at $11.05 per share at market close, up 5.1% since market open. The company has a market cap of $358 million.
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