CVG Q4 2020 Earnings Report
Key Takeaways
CVG reported a 14.0% increase in revenue to $216.0 million in Q4 2020, driven primarily by growth in warehouse automation. Operating income increased by $9.3 million to $5.0 million, and adjusted EBITDA increased by $9.4 million to $13.0 million. The company secured an estimated $100+ million of net annualized new business awards during 2020.
Revenue increased by 14.0% to $216.0 million due to growth in warehouse automation.
Operating income increased by $9.3 million to $5.0 million due to higher volume and improved cost structure.
Adjusted EBITDA increased by $9.4 million to $13.0 million due to higher revenues, lower costs, and improved sales mix.
Warehouse automation revenues grew to $34.4 million, representing 15.9% of Company sales.
CVG
CVG
CVG Revenue by Segment
Forward Guidance
The company expects North American Class 8 truck production levels to be at 302,000 units and Class 5-7 production to be at 246,000 units in 2021. Demand for warehouse automation products is expected to grow approximately 14% per year through 2026.
Positive Outlook
- North American Class 8 truck production levels are expected to increase.
- North American Class 5-7 production levels are expected to increase.
- The outlook for electric vehicle adoption rates are favorable.
- Demand for warehouse automation products is expected to grow approximately 14% per year through 2026.
- Company goal to deliver more than $150 million of sales in 2021 from warehouse automation.
Challenges Ahead
- COVID-19 induced supply and cost risks in the business.
- The full year and specifically the 2nd quarter were impacted significantly by COVID-19.
- There is still COVID-19 risks in the business.
- Multi-year effort to make CVG a secular growth company.
- Still has much to do.
Revenue & Expenses
Visualization of income flow from segment revenue to net income