Blue Bird(BLBD) - 2024 Q1 - Quarterly Report

Financial Performance - Total net sales for the three months ended December 30, 2023, were $317.66 million, a 34.7$235.73 million for the same period in 2022[106]. - Gross profit for the three months ended December 30, 2023, was $63.56 million, compared to$7.46 million for the same period in 2022, indicating a significant improvement[113]. - Operating profit for the three months ended December 30, 2023, was $37.96 million, a turnaround from an operating loss of$9.38 million in the same period last year[113]. - Net income for the three months ended December 30, 2023, was $26.15 million, compared to a net loss of$11.29 million for the same period in 2022[113]. - Shipping and handling revenues increased to $4.7 million for the three months ended December 30, 2023, up from$4.3 million in the same period of 2022[101]. Debt and Financing - Blue Bird executed a $250 million five-year credit agreement with Bank of Montreal, including a$100 million term loan facility and a $150 million revolving credit facility[80][81]. - As of December 30, 2023, the company had$98.5 million in term loan borrowings, down from $130.3 million as of September 30, 2023[93]. - The weighted-average annual effective interest rates for term loans were 9.9$3.63 million, down from $4.20 million in the same period of 2022[113]. Operational Challenges - Supply chain disruptions continued into the first quarter of fiscal 2024, impacting the number of school buses produced and sold, as well as increasing manufacturing costs[77]. - The company faced challenges due to the COVID-19 pandemic and Russia's invasion of Ukraine, which negatively impacted operations and cash flows[76][78]. Revenue Expectations - The company expects to recognize approximately$7.1 million in revenue during fiscal 2024 from federal funds awarded for zero and low emission school buses under the U.S. Infrastructure Investment and Jobs Act[99]. Inventory and Liabilities - Total inventories as of December 30, 2023, were $142.46 million, an increase from$135.29 million as of September 30, 2023[124]. - Total accrued self-insurance liability as of December 30, 2023, was $6.40 million, slightly up from$6.25 million as of September 30, 2023[100]. Taxation - The effective tax rate for the three months ended December 31, 2022, was 20.8%, aligning closely with the statutory federal income tax rate of 21%[104]. Pension and Accounting - The company reported a net periodic pension benefit expense of $36,000 for the three months ended December 30, 2023, compared to$178,000 for the same period in 2022[79]. - The company plans to provide updated disclosures required by new accounting standards in the periods they become effective[123]. Market Position - The company is recognized as a leader in alternative powered school buses, including propane, gasoline, and all-electric options[75]. - The company has taken periodic pricing actions to ensure that sales prices for buses keep pace with increased costs of inventory procurement[77].