On November 2, 2023, Alamo Group Inc (ALG, Financial) released its earnings report for the third quarter ended September 30, 2023. The company reported record net sales of $419.6 million, an increase of 13.8% compared to $368.8 million in the third quarter of 2022. Gross margin improved in the quarter versus the third quarter of 2022 by $21.8 million or 23.6%. Net income improved 35.2% to $34.9 million, or $2.91 per diluted share, compared to net income of $25.8 million, or $2.16 per diluted share in the third quarter of 2022.
Performance Highlights
Vegetation Management net sales were $246.9 million, up 8.0%, and Industrial Equipment net sales were $172.7 million, up 23.1%. Income from operations was $49.8 million, (11.9% of net sales), up 38.8%. The company's backlog at the end of the third quarter was $890.9 million, virtually unchanged from the end of the second quarter of 2023 but slightly down by 2.0% versus the backlog at the end of the third quarter of 2022, and down 11.5% compared to the company's backlog at the end of calendar year 2022.
Executive Commentary
Jeff Leonard, Alamo Group’s President and Chief Executive Officer commented,
“We are very pleased that our results were in line with our expectations and established new Company records for third quarter sales and earnings. Double digit sales growth of almost 14% was driven primarily by strong demand from governmental agencies and industrial contractors."
Financial Position
As of September 30, 2023, Alamo Group Inc (ALG, Financial) reported total assets of $1.45 billion, up from $1.32 billion as of September 30, 2022. The company's total liabilities and stockholders' equity also increased to $1.45 billion from $1.32 billion in the same period.
Looking Ahead
Looking ahead, Leonard expressed confidence in the company's future performance, citing a strong order backlog and healthy market conditions. He also highlighted the recent acquisition of Royal Truck and Equipment, which he expects to be modestly accretive for the balance of 2023.
Explore the complete 8-K earnings release (here) from Alamo Group Inc for further details.
