Alta Equipment Groups reports Second Quarter 2021 results with Net Revenues up 52.4% Y.O.Y.
Second Quarter Financial Highlights:
- Net revenues increased 52.4% year over year to $292.7 million
- Construction and Material Handling revenue of $181.1 million and $111.6 million, respectively
- Product Support gross profit increased $13.4 million year over year to $39.5 million
- Net loss of ($15.7) million available to common shareholders compared to ($4.1) million prior year
- Adjusted EBITDA* grew 40.7% to $28.0 million compared to $19.9 million in Q2 2020
Alta Equipment Group Inc. a provider of premium material handling and construction equipment and related services, today announced financial results for the second quarter ended June 30, 2021.
CEO Comment:
Ryan Greenawalt
Ryan Greenawalt, Chief Executive Officer of Alta, said “Our second quarter performance reflects a positive operating environment across the material handling and construction markets we serve. The constrained supply-chain affecting our manufacturing partners has driven demand for higher margin product support offerings and greater rental utilization. Tightened supply has further elevated equipment pricing across the industry and provides unique opportunities to strategically sell rental fleet, satisfy customer demand for equipment, and achieve field population targets traditionally designated for new equipment installs. We believe our performance in the second quarter further validates our ability to adapt quickly and efficiently to a variety of market conditions, which has led to healthy year over year and sequential adjusted EBITDA growth.”
Mr. Greenawalt, concluded, “The strength of our first-half results, coupled with a record backlog in our Construction and Material Handling businesses, position us well to meet our full-year growth objectives and deliver value to shareholders.”
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Three months ended June 30, |
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Increase (Decrease) |
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Six months ended June 30, |
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Increase (Decrease) |
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2021 |
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2020 |
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2021 versus 2020 |
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2021 |
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2020 |
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2021 versus 2020 |
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Revenues: |
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New and used equipment sales |
$ |
132.0 |
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$ |
95.1 |
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$ |
36.9 |
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38.8 |
% |
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$ |
255.8 |
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$ |
177.3 |
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$ |
78.5 |
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44.3 |
% |
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Parts sales |
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44.1 |
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28.1 |
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16.0 |
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56.9 |
% |
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85.5 |
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56.8 |
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28.7 |
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50.5 |
% |
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Service revenue |
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42.4 |
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28.4 |
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14.0 |
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49.3 |
% |
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81.1 |
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58.6 |
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22.5 |
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38.4 |
% |
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Rental revenue |
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38.2 |
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26.0 |
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12.2 |
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46.9 |
% |
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71.3 |
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51.2 |
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20.1 |
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39.3 |
% |
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Rental equipment sales |
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36.0 |
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14.5 |
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21.5 |
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148.3 |
% |
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67.8 |
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28.7 |
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39.1 |
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136.2 |
% |
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Net revenue |
$ |
292.7 |
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$ |
192.1 |
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$ |
100.6 |
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52.4 |
% |
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$ |
561.5 |
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$ |
372.6 |
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$ |
188.9 |
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50.7 |
% |
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Cost of revenues: |
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New and used equipment sales |
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112.5 |
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83.5 |
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29.0 |
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34.7 |
% |
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219.0 |
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155.9 |
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63.1 |
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40.5 |
% |
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Parts sales |
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30.6 |
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19.4 |
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11.2 |
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57.7 |
% |
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59.3 |
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39.0 |
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20.3 |
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52.1 |
% |
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Service revenue |
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16.4 |
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11.0 |
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5.4 |
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49.1 |
% |
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30.9 |
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22.4 |
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8.5 |
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37.9 |
% |
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Rental revenue |
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5.2 |
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4.5 |
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0.7 |
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15.6 |
% |
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10.7 |
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9.4 |
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1.3 |
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13.8 |
% |
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Rental depreciation and |
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21.3 |
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15.0 |
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6.3 |
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42.0 |
% |
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40.7 |
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27.9 |
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12.8 |
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45.9 |
% |
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Rental equipment sales |
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29.8 |
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12.4 |
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17.4 |
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140.3 |
% |
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56.7 |
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24.6 |
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32.1 |
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130.5 |
% |
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Cost of revenue |
$ |
215.8 |
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$ |
145.8 |
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$ |
70.0 |
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48.0 |
% |
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$ |
417.3 |
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$ |
279.2 |
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$ |
138.1 |
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49.5 |
% |
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Gross profit |
$ |
76.9 |
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$ |
46.3 |
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$ |
30.6 |
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66.1 |
% |
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$ |
144.2 |
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$ |
93.4 |
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$ |
50.8 |
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54.4 |
% |
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Total general and administrative |
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73.7 |
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45.4 |
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$ |
28.3 |
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62.3 |
% |
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140.6 |
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|
97.5 |
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$ |
43.1 |
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44.2 |
% |
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Income (loss) from operations |
$ |
3.2 |
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$ |
0.9 |
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$ |
2.3 |
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255.6 |
% |
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$ |
3.6 |
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$ |
(4.1 |
) |
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$ |
7.7 |
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(187.8 |
)% |
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Total other income |
$ |
(17.8 |
) |
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$ |
(5.4 |
) |
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$ |
(12.4 |
) |
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229.6 |
% |
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$ |
(23.4 |
) |
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$ |
(18.5 |
) |
|
$ |
(4.9 |
) |
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|
26.5 |
% |
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Loss before taxes |
$ |
(14.6 |
) |
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$ |
(4.5 |
) |
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(10.1 |
) |
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224.4 |
% |
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$ |
(19.8 |
) |
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$ |
(22.6 |
) |
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2.8 |
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(12.4 |
)% |
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Income tax provision (benefit) |
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— |
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(0.4 |
) |
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0.4 |
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(100.0 |
)% |
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|
0.5 |
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(1.5 |
) |
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2.0 |
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(133.3 |
)% |
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Net loss |
$ |
(14.6 |
) |
|
$ |
(4.1 |
) |
|
|
(10.5 |
) |
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|
256.1 |
% |
|
$ |
(20.3 |
) |
|
$ |
(21.1 |
) |
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|
0.8 |
|
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|
(3.8 |
)% |
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Preferred Stock Dividends |
|
(1.1 |
) |
|
|
— |
|
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|
(1.1 |
) |
|
|
— |
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|
(1.1 |
) |
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— |
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(1.1 |
) |
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— |
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Net loss available to common shareholders |
$ |
(15.7 |
) |
|
$ |
(4.1 |
) |
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|
(11.6 |
) |
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|
282.9 |
% |
|
$ |
(21.4 |
) |
|
$ |
(21.1 |
) |
|
|
(0.3 |
) |
|
|
1.4 |
% |
Recent Business Highlights:
- During the quarter, Alta completed the full integration of prior acquisitions – Flagler Construction Equipment, Liftech Equipment, and Hilo Equipment & Services onto the company’s ERP system, now having fully integrated six of its eight acquisitions since 2019. The integration will provide for efficiencies relative to operating a single source of information and gives management improved, real-time visibility into these business units.
- On April 1, 2021, the Company refinanced its capital structure via completion of a $315 million second lien debt offering and amended its credit agreements with our senior lending group. Among other benefits, the refinance immediately improved the Company’s liquidity position, reduced our incremental cost of capital, and eliminated certain restrictive covenants to support the execution of our growth strategy.
- Product support revenue, which includes parts and service sales, grew 53.1% year over year in the second quarter providing an ongoing higher margin, recurring revenue stream.
- On August 10, Alta announced an agreement with Nikola Corporation, a designer and manufacturer of heavy-duty commercial battery-electric vehicles (BEV) and fuel-cell electric vehicles (FCEV) naming Alta as the authorized dealer to sell and service Nikola medium and long-haul Class 8 EV/FCEV trucks in the New York, New Jersey, eastern Pennsylvania, and New England markets. The agreement marks Alta’s expansion into the Class 8 commercial electric vehicle segment and builds upon its eMobility strategy.
Full Year Financial Guidance:
The Company maintained its guidance range, and expects to report Adjusted EBITDA between $110 million to $115 million, net of new equipment floorplan interest, for the full year 2021.
