“I am incredibly proud of the progress by our team in completing our business turnaround, and the outcome of all the hard work is evident in our financial results. The Blue Bird team has been executing a rigorous plan for over 18 months to improve operations, reduce fixed costs and recover economics through pricing," said Phil Horlock, CEO of Blue Bird Corporation. "The market demand for Blue Bird’s school buses remains very strong with nearly 5,200 units in our order backlog. Unit sales were 24% higher than a year ago and we grew revenue by an exceptional 43% in the third quarter. Adjusted EBITDA was over 3X last year’s third quarter – in summary, a terrific quarter for Blue Bird, with an Adjusted EBITDA margin of almost 10%.
"We expanded our leadership position in alternative-powered school buses, particularly in zero-emission school buses where we achieved outstanding growth in EV bookings, which were up nearly 150% from last year’s third quarter; additionally, we have more than 550 electric school bus orders in our backlog. We have seen steady growth in EV orders from the EPA’s 2022 Clean School Bus Rebate Program, which awarded nearly $1 billion in funding from Phase 1 of the program. This funding alone will generate orders for at least 550 Blue Bird buses. In addition, we are excited to see further progress with the announcement of Phase 2 of the program, offering a $400M competitive grant program for electric school buses. Exciting growth ahead for Blue Bird on the EV front!
"Based on our substantial progress, we increased our full year financial guidance again and look forward to sustained profitable growth, particularly as the global supply chain recovery progresses.”
FY2023 Guidance Increased
"We are very excited with the FY2023-Q3 results, with Revenues coming in at the top end of our guidance and Adjusted EBITDA above guidance” said Razvan Radulescu, CFO of Blue Bird Corporation. “Our turnaround is completed and we have returned to historical profitability, and expect further increased performance for fiscal Q4, as shown in the forecast shared during the earnings call. We are raising full year fiscal 2023 guidance to Net Revenue of just over $1.1 Billion, Adj. EBITDA of $70-76 million and Adj. Free Cash Flow of $70-80 million. Additionally, we are reconfirming our long-term outlook of profitable growth towards $2 billion in revenues and Adjusted EBITDA margins of 12%, or $250 million.”
Fiscal 2023 Third Quarter Results
Net Sales
Net sales were $294.3 million for the third quarter of fiscal 2023, an increase of $88.2 million, or 42.8%, from prior year period. Bus sales increased $83.7 million, reflecting a 17.0% increase in average sales price per unit, resulting from pricing actions taken by management as well as product and customer mix change, and a 23.8% increase in units booked. In the third quarter of fiscal 2023, 2,137 units were booked compared to 1,726 units booked for the same period in fiscal 2022. The increase in units sold was primarily due to constraints in the Company's ability to produce and deliver buses due to shortages of critical components in the third quarter of fiscal 2022. Additionally, Parts sales increased $4.6 million, or 23.4%, for the third quarter of fiscal 2023 compared to the third quarter of fiscal 2022. This increase is primarily attributed to pricing actions taken by management to offset increases in purchased parts costs and increased inventory availability as supply chain constraints began to improve during the third quarter of fiscal 2023 relative to the third quarter of fiscal 2022.
Gross Profit
Third quarter gross profit of $45.8 million represented an increase of $24.2 million from the third quarter of last year. The increase was primarily driven by the $88.2 million increase in net sales, discussed above. This was partially offset by an increase of $64.0 million in cost of goods sold, primarily corresponding the increase net sales.
Net Income
Net income was $9.4 million for the third quarter of fiscal 2023, which was a $15.8 million increase compared to the same period last year. The increase was primarily driven by the $24.2 million increase in gross profit, discussed above. Partially offsetting this was an increase of $7.2 million in other expense, primarily due to expenses we were required to pay on behalf of several stockholders in connection with their sale of shares of common stock during the third quarter of fiscal 2023, with no similar expense recorded during the same period of fiscal 2022.
