Alamo Group Inc. reported its interim financial results for the three and nine months ended September 30, 2024, revealing a mixed performance compared to the previous fiscal period. The company’s net sales for the third quarter totaled $401.3 million, a decrease of 4% from $419.6 million in Q3 2023. For the nine-month period, net sales were $1,243.2 million, down 2% from $1,272.1 million in the same period last year. The decline in sales was primarily attributed to weakened demand in the Vegetation Management Division, which saw a significant 23% drop in sales for Q3 and an 18% decrease for the nine months.
Gross profit for Q3 2024 was $100.9 million, representing 25% of net sales, down from $114.1 million (27% of net sales) in Q3 2023. For the nine months, gross profit decreased to $320.7 million (26% of net sales) from $344.7 million (27% of net sales) in the prior year. The decline in gross profit margins was linked to lower sales volume and production inefficiencies, particularly in the Vegetation Management Division.
Operating income also fell, with Q3 2024 reporting $40.1 million compared to $49.8 million in Q3 2023. For the nine-month period, operating income decreased to $130.4 million from $153.2 million. Net income for Q3 2024 was $27.4 million, down from $34.9 million in the same quarter of 2023, while net income for the nine months was $87.8 million, a decrease from $104.6 million.
Despite these challenges, Alamo Group's balance sheet showed improvements. Cash and cash equivalents increased significantly to $140.0 million as of September 30, 2024, up from $51.9 million at the end of 2023. Total current assets rose to $879.6 million from $804.0 million, and total assets increased to $1.48 billion from $1.41 billion. Long-term debt decreased to $209.2 million from $220.3 million, contributing to a stronger financial position.
Strategically, Alamo Group acquired Royal Truck & Equipment, Inc. for approximately $32 million on October 10, 2023, aiming to expand its operations into the highway safety and equipment market. The company also declared dividends of $0.26 per share for Q3 2024, up from $0.22 in the same period last year, and $0.78 for the nine months, an increase from $0.66 in 2023.
Overall, while Alamo Group faced revenue declines primarily in its Vegetation Management Division, it maintained a solid financial foundation and pursued strategic growth through acquisitions.
About ALAMO GROUP INC
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