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Sep 30, 2022
Alamo Group Q3 2022 Earnings Report
Reported record third quarter sales and earnings, driven by effective price management and disciplined control of operating expenses, despite persistent headwinds.
Key Takeaways
Alamo Group Inc. reported record results for the third quarter ended September 30, 2022. Net sales were $368.8 million, up 9.0%. Net income improved 46.9% to $25.8 million, or $2.16 per diluted share. The Company’s backlog at the end of the third quarter was $908.9 million, an increase of $263.7 million, or 40.9%, from the backlog at the end of the third quarter of 2021.
Net sales of $368.8 million, up 9.0%.
Vegetation Management net sales of $228.5 million, up 8.9%.
Industrial Equipment net sales of $140.3 million, up 9.2%.
Net income of $25.8 million, or $2.16 per diluted share, up 46.9%.
Alamo Group
Alamo Group
Forward Guidance
The Company is expecting fourth quarter sales to show solid growth relative to the fourth quarter of 2021 and anticipates that earnings will continue to improve on a year-over-year basis. However, exchange rates are likely to negatively impact sales when compared to the prior year. The company continue to anticipate a gradual improvement in supply chain performance; however, the timing remains uncertain and problems associated with labor shortages are expected to persist.
Positive Outlook
- Expecting fourth quarter sales to show solid growth relative to the fourth quarter of 2021.
- Anticipate that earnings will continue to improve on a year-over-year basis.
- Continue to anticipate a gradual improvement in supply chain performance.
- Strength and health of backlog continues to provide us with confidence about the performance of the Company for the remainder of this year and the near future.
- Sales and earnings will expand nicely once the supply side issues resolve.
Challenges Ahead
- Exchange rates are likely to negatively impact sales when compared to the prior year.
- The timing of supply chain improvements remains uncertain.
- Problems associated with labor shortages are expected to persist.
- Supply chain delays and shortages again constrained sales during the third quarter.
- The combination of supply chain delays and labor shortages once again reduced operational efficiency and resulting gross margin during the third quarter.