Alamo (ALG) - 2024 Q2 - Quarterly Report

Financial Performance - For the first six months of 2024, the Company's net sales decreased by 1% to $841.9 million compared to$852.5 million in the same period of 2023[55] - Net income for the first six months of 2024 was $60.4 million, a decrease of 13$69.7 million in the same period of 2023, resulting in earnings per share of $5.02 compared to$5.82[66] - The Vegetation Management Division experienced a 16% decrease in sales to $435.3 million for the first six months of 2024, primarily due to weakened demand[56] - The Industrial Equipment Division saw a 21$406.6 million for the first six months of 2024, driven by strong demand across all product lines[64] - Gross profit for the first six months of 2024 was $219.8 million, representing 26$230.6 million or 27% in the same period of 2023[64] Backlog and Expenses - The Company's backlog at the end of the first six months of 2024 was $768.9 million, a decrease of 14$891.2 million at the end of the same period in 2023[57] - Selling, general and administrative expenses (SG&A) for the first six months of 2024 were $121.4 million, an increase of 1.9 million from$119.5 million in the same period of 2023[65] Capital Expenditures and Working Capital - Capital expenditures for the first six months of 2024 were $11.1 million, down from$18.2 million in the same period of 2023, with an expected full-year capital expenditure of $30.0 million to$35.0 million[69] - The Company had working capital of $699.9 million as of June 30, 2024, an increase of$109.9 million from $590.0 million at December 31, 2023[68] Debt and Interest - Interest expense for the first six months of 2024 was$12.2 million, a decrease from $12.8 million in the same period of 2023, primarily due to debt reduction[65] - The Company entered into a 2022 Credit Agreement providing up to$655.0 million in loans, with $255.0 million borrowed under a Term Facility and$400.0 million available under a Revolver Facility[71] - As of June 30, 2024, $294.5 million was outstanding under the 2022 Credit Agreement, including$228.8 million on the Term Facility and $65.8 million on the Revolver Facility[72] - The Company is required to make quarterly principal payments of$3.75 million on the Term Facility, with the final payment due at the end of the five-year term[71] - The applicable interest margin for Term SOFR borrowings ranges from 1.25% to 2.50%, and for Base Rate borrowings from 0.25% to 1.50%, based on the Company's consolidated leverage ratio[71] - The Company has $331.7 million in available borrowings after accounting for$2.6 million committed to standby letters of credit[72] - The Company believes the 2022 Credit Agreement and internal cash generation will meet its cash requirements for the foreseeable future, despite potential banking industry challenges[73] Foreign Currency and Interest Rate Sensitivity - The total foreign currency translation adjustment for the current quarter decreased stockholders' equity by $5.5 million[84] - A uniform 10$7.0 million change in gross profit for the six-month period ended June 30, 2024[85] - A two percentage point change in average interest rates could change the Company's interest expense by approximately $1.5 million[86] - The Company is in compliance with the financial covenants under the 2022 Credit Agreement as of June 30, 2024[72]