Blue Bird Corporation (NASDAQ:BLBD), a leading school bus manufacturer, has reported a record-breaking financial performance for the fiscal year 2023, surpassing its own guidance in every quarter. The company achieved a historic profit in the fourth quarter with a robust adjusted EBITDA margin of 13%. With the transition to alternative-powered vehicles and strategic investments in facility upgrades, Blue Bird's full-year net revenue soared to $1.13 billion, marking a 41% increase from the previous year. The company's backlog, valued at over $670 million, reflects strong market demand for school buses, including electric models. Looking ahead, Blue Bird anticipates continued growth with an adjusted EBITDA margin of 10% for fiscal year 2024.
Key Takeaways
- Blue Bird Corporation reported a record-breaking fiscal year with $1.13 billion in revenue and $88 million in adjusted EBITDA.
- The company's backlog stood at 4,600 units with a value exceeding $670 million.
- A shift towards alternative-powered vehicles, such as electric buses, contributed to the financial success.
- Blue Bird plans to invest in product development, capacity expansion, and employee benefits in the coming fiscal year.
- The company has announced a mid-year price increase for new bus orders to mitigate inflationary pressures.
- A joint venture with Generate Capital, Clean Bus Solutions, is set to accelerate the adoption of electric buses.
Company Outlook
- Blue Bird forecasts revenue between $1.15 billion and $1.25 billion for fiscal year 2024.
- The company anticipates an adjusted EBITDA margin of $115 million or 10%.
- Long-term targets include $2 billion in revenue, 12,000 units sold, and EBITDA exceeding $250 million.
Bearish Highlights
- The company sold approximately 2,500 fewer units compared to its best year in 2019.
- Supply chain volatility remains a concern, necessitating quarterly guidance ranges.
Bullish Highlights
- The transition away from legacy-priced units to alternative-powered vehicles is driving financial performance.
- Blue Bird's strong financial results have enabled it to refinance its credit facility and reduce debt by $40 million.
Misses
- Despite record revenues, the company did not match the peak sales volume of 2019.
Q&A Highlights
- CEO Phil Horlock emphasized that seasonality issues are mitigated by the current backlog and strong demand.
- The collaboration with Cummins (NYSE:CMI) aims to reduce the cost of operating and acquiring EV school buses.
- Blue Bird has applied for the entire $400 million in federal funding for clean school buses, with the EPA to decide on recipients.
- Labor negotiations with the United Steelworkers are expected to continue into 2024.
Blue Bird Corporation's fiscal year 2023 performance sets a high bar for the industry, with its pivot towards environmentally friendly transportation solutions and strategic partnerships placing it at the forefront of the school bus market. The company's robust backlog and investment in innovation position it well for sustained growth in the years to come.
InvestingPro Insights
Blue Bird Corporation's (BLBD) remarkable fiscal year has been underscored by its financial metrics and market performance, as reflected in real-time data from InvestingPro. The company's market capitalization stands at a solid $829.86 million, showcasing its significant presence in the industry. This valuation is supported by a revenue growth of 41.49% for the last twelve months as of Q4 2023, further cementing Blue Bird's successful expansion in the market.
InvestingPro Tips highlight that Blue Bird is expected to see net income growth this year, an optimistic sign for investors looking at the company's profitability potential. Additionally, analysts have projected sales growth in the current year, which aligns with the company's reported revenue increases and promising outlook for fiscal year 2024.
For investors considering the stock's current position, it's worth noting that Blue Bird is trading at a high Price / Book multiple of 20.03, suggesting a premium valuation by the market. This high multiple, along with a P/E Ratio of 32.55, indicates that investors are willing to pay more for the company's earnings, potentially due to the anticipated growth and profitability.
As part of the special Cyber Monday sale, InvestingPro is offering a subscription at up to 60% off. For those looking to delve deeper into Blue Bird's financials and market performance, you can use coupon code sfy23 to get an additional 10% off a 2-year InvestingPro+ subscription. With 15 additional InvestingPro Tips listed for BLBD on the platform, subscribers can gain a more nuanced understanding of the company's investment potential.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.