Alamo Group Inc (ALG) 2023 Q3 法說會逐字稿

Good day, and welcome to the Alamo Group Inc. Third Quarter 2023 Conference Call. (Operator Instructions) Please note this event is being recorded.

美好的一天，歡迎參加 Alamo Group Inc. 2023 年第三季電話會議。 （操作員說明）請注意此事件正在被記錄。

I would now like to turn the conference over to Edward Rizzuti, Executive Vice President, General Counsel and Secretary. Please go ahead.

我現在將會議交給執行副總裁、總法律顧問兼秘書愛德華·裡祖蒂 (Edward Rizzuti)。請繼續。

Thank you. By now, you should have all received a copy of the press release. However, if anyone is missing a copy and would like to receive one, please contact us at (212) 827-3746, and we will send you a release and make sure you are on the company's distribution list. There will be a replay of the call, which will begin 1 hour after the call and run for 1 week. The replay can be accessed by dialing 1 (877) 344-7529 with the passcode 1294689. Additionally, the call is being webcast on the company's website at www.alamo-group.com, and a replay will be available for 60 days.

謝謝。到現在為止，你們應該都收到了新聞稿的副本。但是，如果有人遺失了一份副本並希望收到一份，請致電 (212) 827-3746 與我們聯繫，我們將向您發送授權書，並確保您在公司的分發名單上。通話將進行重播，重播將在通話後 1 小時開始，持續 1 週。可以透過撥打 1 (877) 344-7529（密碼 1294689）觀看重播。此外，該電話會議正在公司網站 www.alamo-group.com 上進行網路直播，重播將在 60 天內提供。

On the line with me today are Jeff Leonard, President and Chief Executive Officer; and Richard Wehrle, Executive Vice President, Chief Financial Officer and Treasurer. Management will make some opening remarks, and then we will open up the line for your questions.

今天和我一起在線的是總裁兼首席執行官傑夫·倫納德 (Jeff Leonard)；理查德‧韋爾勒（Richard Wehrle），執行副總裁、財務長兼財務長。管理層將發表一些開場白，然後我們將開放您的提問熱線。

During the call today, management may reference certain non-GAAP numbers in their remarks. Reconciliations of these non-GAAP results to applicable GAAP numbers are included in the attachments to our earnings release.

在今天的電話會議中，管理階層可能會在演講中引用某些非公認會計準則資料。這些非 GAAP 結果與適用的 GAAP 資料的對帳包含在我們收益發布的附件中。

Before turning the call over to Jeff, I'd like to make a few comments about forward-looking statements. We will be making forward-looking statements today that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results.

在將電話轉給傑夫之前，我想對前瞻性陳述發表一些評論。我們今天將根據1995 年《私人證券訴訟改革法案》的安全港條款作出前瞻性陳述。前瞻性陳述涉及已知和未知的風險和不確定性，這些風險和不確定性可能會導致公司未來期間的實際結果與預測結果有重大差異。

Among those factors which could cause actual results to differ materially are the following: adverse economic conditions, which could lead to a reduction in overall market demand, supply chain disruptions, labor constraints, competition, weather, seasonality, currency-related issues, geopolitical events and other risk factors listed from time to time in the company's SEC reports. The company does not undertake any obligation to update the information contained herein, which speaks only as of this date.

可能導致實際結果出現重大差異的因素如下：不利的經濟狀況可能導致整體市場需求減少、供應鏈中斷、勞動力限制、競爭、天氣、季節性、貨幣相關問題、地緣政治事件以及公司SEC 報告中不時列出的其他風險因素。該公司不承擔更新本文所含資訊的任何義務，這些資訊僅代表截至目前的情況。

I would now like to introduce Jeff Leonard. Jeff, please go ahead.

現在我想介紹傑夫·倫納德。傑夫，請繼續。

Thank you, Ed. We want to thank everyone who's joined us on the conference call today and express our appreciation for your continued interest in Alamo Group.

謝謝你，艾德。我們要感謝今天參加我們電話會議的所有人，並對您對阿拉莫集團的持續關注表示感謝。

The third quarter shaped up broadly in line with our expectations, and we were very pleased with the financial results reported today that were produced in an increasingly challenging operating environment. Despite persistent inflation, higher interest rates and ongoing labor constraints, our teams achieved record quarterly results for sales and earnings for the eighth consecutive quarter.

第三季的情況基本上符合我們的預期，我們對今天報告的財務業績非常滿意，這些業績是在日益充滿挑戰的營運環境中產生的。儘管通貨膨脹持續存在、利率上升以及持續的勞動力限制，我們的團隊仍連續第八個季度取得了創紀錄的銷售和獲利季度業績。

I would now like to turn the call over to Richard, who will take us through a review of our financial results for the third quarter. I will then provide additional comments on the results and say a few words about the outlook for the next few quarters. Following our formal remarks, we will look forward to taking your questions. So Richard, please go ahead.

我現在想把電話轉給理查德，他將帶領我們回顧第三季的財務表現。然後我將對結果提供更多評論，並就未來幾季的前景發表一些看法。在我們正式發言之後，我們將期待回答您的問題。理查德，請繼續。

Thanks, Jeff, and good morning, everyone. Alamo Group's third quarter 2023 closed with an excellent performance that produced record net sales and net income driven by continued strong demand for our products. Third quarter consolidated net sales were $419.6 million, an increase of 14% compared to $368.8 million in the third quarter of last year. Gross margin percentage expanded by 220 basis points and gross margin increased by just under $22 million in the quarter compared to the third quarter of 2022. Both margin dollars and percentages were driven by higher volume and price initiatives we began in early 2022, along with improved productivity gains.

謝謝傑夫，大家早安。 Alamo 集團 2023 年第三季表現出色，在對我們產品持續強勁的需求推動下，淨銷售額和淨利潤創歷史新高。第三季合併淨銷售額為 4.196 億美元，比去年第三季的 3.688 億美元成長 14%。與2022 年第三季相比，本季毛利率擴大了220 個基點，毛利率增加了近2,200 萬美元。利潤率和百分比均受到我們於2022 年初開始的更高銷量和價格計劃的推動，同時改善了生產力提高。

Operating income for the third quarter came in at $49.8 million versus $35.8 million in the third quarter of 2022, an increase of 39%. Operating income as a percent of sales was just under 12% for the third quarter versus just under 10% for the same quarter last year. Consolidated net income for the third quarter was $34.9 million, or $2.91 per diluted share, an increase of 35% versus net income of $25.8 million or $2.16 per diluted share for the third quarter of 2022.

第三季營業收入為 4,980 萬美元，較 2022 年第三季的 3,580 萬美元成長 39%。第三季營業收入佔銷售額的百分比略低於 12%，而去年同期則略低於 10%。第三季合併淨利為 3,490 萬美元，即稀釋後每股收益 2.91 美元，較 2022 年第三季淨利 2,580 萬美元，即稀釋後每股收益 2.16 美元成長 35%。

Looking at the division's Vegetation Management division, once again delivered solid results. Net sales were $246.9 million, an increase of 8% compared to $228 million -- $228.5 million for the third quarter of 2022. Strong sales of governmental and agricultural mowing equipment in North America, U.K., Europe -- U.K. and Europe led the way for this division, despite labor shortages, and to a lesser extent, supply chain disruptions, margins improved primarily due to increased net price realization. Operating income for the third quarter in this division was $30.3 million, up 12% versus $27.1 million for the same period in 2022.

該部門的植被管理部門再次取得了紮實的成果。淨銷售額為 2.469 億美元，較 2022 年第三季的 2.28 億美元增長 8% - 2.285 億美元。北美、英國、歐洲政府和農業割草設備的強勁銷售——英國和歐洲引領了儘管存在勞動力短缺以及較小程度的供應鏈中斷，但該部門的利潤率仍有所提高，這主要是由於淨價實現的增加。該部門第三季的營業收入為 3,030 萬美元，比 2022 年同期的 2,710 萬美元成長 12%。

Industrial Equipment net sales -- division net sales were $172.7 million, up 23% compared to $140.3 million for the third quarter of 2022. This was due to a solid performance across all product lines, particularly vacuum trucks, sweepers, debris collectors and snow removal equipment. While truck chassis deliveries continue to return to a normal cadence -- to a more normal cadence, some component part shortages continue to impact this division's operations, although not as significant as in previous quarters. This resulted in a substantial rise in operating income in the third quarter for this division of $19.5 million compared to $8.7 million for the third quarter of 2022, an increase of 124%.

工業設備淨銷售額－部門淨銷售額為1.727 億美元，較2022 年第三季的1.403 億美元成長23%。這是由於所有產品線的穩健表現，特別是吸塵車、清掃車、碎片收集器和除雪車設備。雖然卡車底盤交付繼續恢復到正常節奏，但一些零件短缺繼續影響該部門的運營，儘管不像前幾季那麼嚴重。這導致該部門第三季營業收入大幅增加 1,950 萬美元，而 2022 年第三季營業收入為 870 萬美元，成長 124%。

Consolidated net sales were a record for the first 9 months of 2023, coming in at $1.27 billion, up 13% compared to $1.12 billion for the first 9 months of 2022. Strong demand for our products in both divisions, along with positive impacts of pricing initiatives and improved supply chain and productivity, were the main drivers of the increase.

2023 年前 9 個月的綜合淨銷售額創歷史新高，達到 12.7 億美元，比 2022 年前 9 個月的 11.2 億美元增長 13%。兩個部門對我們產品的強勁需求以及定價的積極影響舉措以及改善的供應鏈和生產力是成長的主要驅動力。

Nine-month gross margin percentage was up 240 basis points and gross margin increased $66 million versus the first 9 months of 2022, an increase of 24%. The margin improvement experienced resulted from improved supply chain conditions, which led to higher efficiencies and enhanced capacity utilizations.

前九個月的毛利率上升了 240 個基點，毛利率較 2022 年前 9 個月增加了 6,600 萬美元，增幅為 24%。利潤率的提高得益於供應鏈條件的改善，從而提高了效率並提高了產能利用率。

Operating income in the first 9 months of 2023 was $153.2 million or 12% of sales compared to the same period in 2022, which was $105.9 million or just over 9% of sales, a 260 basis point increase. Net income for the first 9 months of 2023 was $104.6 million or $8.73 per diluted share versus net income of $72.8 million or $6.10 per diluted share for the first 9 months of 2022, an increase of 44%.

2023 年前 9 個月的營業收入為 1.532 億美元，佔銷售額的 12%，而 2022 年同期為 1.059 億美元，佔銷售額的 9% 多一點，增加了 260 個基點。 2023 年頭9 個月的淨利潤為1.046 億美元，即稀釋後每股收益8.73 美元，而2022 年前9 個月的淨利潤為7280 萬美元，即稀釋後每股收益6.10 美元，增長了44 %。

The company's backlog at the end of the third quarter of 2023 came in at just under $891 million, virtually unchanged from the end of the second quarter of 2023 but was slightly down by 2% compared to the backlog at the end of the third quarter 2022.

截至 2023 年第三季末，該公司的積壓訂單略低於 8.91 億美元，與 2023 年第二季末基本持平，但與 2022 年第三季末的積壓訂單相比略有下降 2% 。

Few additional financial items I'd like to cover related to the balance sheet at the end of the third quarter, which continues to remain strong. Working capital increased $96 million compared to the end of the third quarter of 2022. The increase resulted from higher accounts receivable, and to a lesser extent, inventory.

我想介紹的其他財務項目很少與第三季末的資產負債表有關，該資產負債表繼續保持強勁。與 2022 年第三季末相比，營運資本增加了 9,600 萬美元。這一增長是由於應收帳款增加以及庫存增加所致。

During the third quarter, as we expected, we reduced our debt level on our current credit facility by almost $24 million and our bank leverage ratio at the end of the third quarter was 1.33:1. Which is at its lowest level in 4 years.

在第三季度，正如我們預期的那樣，我們將當前信貸額度的債務水準減少了近 2,400 萬美元，第三季末的銀行槓桿率為 1.33:1。這是四年來的最低水準。

And finally, the company's trailing 12-month EBITDA was a record, coming in at just over $245 million, up 25% compared to the calendar year-end 2022.

最後，該公司過去 12 個月的 EBITDA 創紀錄，略高於 2.45 億美元，比 2022 年底成長了 25%。

For the balance of 2023 and into 2024, cash flow should remain strong as our focus on the balance sheet will be to further reduce both inventory and debt. Increasing consolidated profits will be extremely important. We remain disciplined in our execution of controlling costs and expenses as inflation continues to put pressure on our margins.

從 2023 年到 2024 年，現金流應該保持強勁，因為我們對資產負債表的關注重點將是進一步減少庫存和債務。增加綜合利潤將極為重要。由於通貨膨脹繼續給我們的利潤帶來壓力，我們仍然嚴格控製成本和費用。

We will continue to focus on further improving supply chain performance to help reduce the amount of inventory we hold in work in process. Our biggest challenge will continue -- will continue to be meeting the heightened demand of our products throughout the company, given persistent labor shortages.

我們將繼續專注於進一步改善供應鏈績效，以幫助減少我們在製品中的庫存量。鑑於持續的勞動力短缺，我們面臨的最大挑戰將繼續——將繼續滿足整個公司對我們產品日益增長的需求。

So in summary, Q3 was a great quarter for Alamo Group. Sales were up 14%, which translated into a 39% increase in operating income and a 35% increase in net income. We're also pleased our Board recently approved a regular quarterly dividend of $0.22 per share for the third quarter of 2023.

總而言之，第三季對於 Alamo 集團來說是一個很棒的季度。銷售額成長 14%，營業收入成長 39%，淨利成長 35%。我們也很高興董事會最近批准了 2023 年第三季每股 0.22 美元的定期季度股息。

With that, I'll turn the call back over to Jeff.

這樣，我會將電話轉回給傑夫。

Thank you, Richard. I'd like to express my personal thanks to everyone who's joined our conference call today. While both operating divisions achieved solid top line sales growth, as expected, growth in the Industrial Equipment division was stronger. .

謝謝你，理查。我想向今天參加我們電話會議的所有人表達我個人的感謝。正如預期的那樣，兩個營運部門均實現了穩健的營收成長，但工業設備部門的成長更為強勁。 。

Governmental agencies continue to invest in updating their infrastructure maintenance fleets, and as supply chain bottlenecks continued to resolve. Although certain types of components remain problematic, supply chain performance improved again during the third quarter.

隨著供應鏈瓶頸的不斷解決，政府機構繼續投資更新其基礎設施維護車隊。儘管某些類型的零件仍然存在問題，但供應鏈績效在第三季再次改善。

Receipts of Class 6 to 8 truck chassis that represent the bulk of our requirements improved sequentially, while the supply of Class 5 and smaller chassis, which are less significant to us, became somewhat more restricted. As has been the case for the past year, certain types of industrial components continue to be constrained and intermittent shortages once again adversely impacted our production operations.

代表我們大部分需求的 6 至 8 級卡車底盤的接收量連續增加，而對我們來說不太重要的 5 級和更小型底盤的供應變得更加有限。與去年的情況一樣，某些類型的工業零件繼續受到限制，間歇性短缺再次對我們的生產營運產生了不利影響。

Markets for our Vegetation Management equipment division remained under pressure in the third quarter from the combined effects of higher interest rates, a weaker housing market, a bumper corn crop and persistent drought in much of the Midwest and Southern United States.

由於利率上升、房地產市場疲軟、玉米豐收以及美國中西部和南部大部分地區持續乾旱的綜合影響，我們的植被管理設備部門的市場在第三季度仍然面臨壓力。

Order bookings in this division were down slightly compared with the third quarter of 2022, but were sharply higher than the second quarter of this year. U.S. farmers continue to express concerns about high input costs, rising interest rates and lower crop and livestock prices.

該部門的訂單預訂量較 2022 年第三季略有下降，但較今年第二季大幅增加。美國農民繼續對高投入成本、利率上升以及農作物和牲畜價格下降表示擔憂。

Hobby farm and ranch dealer inventories, while not at a concerning level from a historical perspective, are under increasing scrutiny due to rising financing costs, tighter credit and greater buyer caution.

業餘愛好農場和牧場經銷商的庫存雖然從歷史角度來看並未達到令人擔憂的水平，但由於融資成本上升、信貸收緊和買家更加謹慎，正受到越來越嚴格的審查。

Higher interest rates also constrained demand for our larger forestry and wood recycling equipment, as many of these larger ticket purchases are subject to third quarter -- third-party financing. Housing starts in the third quarter declined about 1% compared to the second quarter but were up about 5% compared to a year earlier, even considering steadily higher mortgage rates.

較高的利率也限制了對大型林業和木材回收設備的需求，因為許多大型採購都需要第三季的第三方融資。第三季新屋開工量較第二季下降約 1%，但較上年同期成長約 5%，即使考慮到抵押貸款利率穩定上升。

We were very pleased that despite these headwinds, new orders for forestry and tree care equipment improved nicely compared to the second quarter, although still below the levels achieved in the third quarter of 2022.

我們非常高興的是，儘管存在這些不利因素，林業和樹木護理設備的新訂單與第二季度相比仍出現了良好改善，儘管仍低於 2022 年第三季度實現的水平。

Europe and the United Kingdom were notable bright spots again during the third quarter. Orders received in the U.K., the Netherlands and France moved higher compared to both second quarter of this year and the prior year third quarter despite challenging market conditions. It's also worth noting that orders received in South America set an all-time company record during the quarter as demand for our sugarcane harvest hauling equipment and other agricultural and forestry products continue to rise.

歐洲和英國在第三季再次成為引人注目的亮點。儘管市場條件充滿挑戰，但與今年第二季和去年第三季相比，英國、荷蘭和法國收到的訂單均有所成長。另外值得注意的是，隨著對我們的甘蔗收穫運輸設備和其他農林產品的需求持續增長，本季在南美洲收到的訂單創下了公司歷史記錄。

Against the backdrop of increasing economic headwinds, we were extremely pleased that the Vegetation Management division third quarter sales increased by 8% year-over-year. Orders were sharply higher sequentially and profitability remains strong.

在經濟逆風加劇的背景下，我們非常高興地看到植被管理部門第三季銷售額年增 8%。訂單量連續大幅增加，獲利能力依然強勁。

Operating income from this division improved more than 11% compared to the third quarter of 2022 and once again exceeded our targeted level of 12% of sales.

與 2022 年第三季相比，該部門的營業收入成長了 11% 以上，再次超過了我們佔銷售額 12% 的目標水準。

Activity in the governmental sector continued to be strong during the third quarter in all markets where we operate. Demand for infrastructure maintenance equipment remained buoyant as it has been all year.

第三季度，在我們開展業務的所有市場中，政府部門的活動持續強勁。與全年一樣，基礎設施維護設備的需求仍然強勁。

Order bookings in our Industrial Equipment division were 25% higher than the prior year third quarter and also nicely higher than the second quarter of this year. While all of our product lines remained in high demand from governmental agencies during the third quarter, demand for our municipal snow plows was exceptional.

我們工業設備部門的訂單預訂量比去年第三季高出 25%，也遠高於今年第二季。儘管第三季政府機構對我們所有產品線的需求仍然很高，但對我們的市政除雪機的需求卻異常巨大。

Snow removal order bookings increased by more than 100% compared to the third quarter of 2022, and backlog in this part of the business is at its highest level ever achieved. This is very nice growth, and was partly driven by the successful introduction and rapid acceptance of our new wide wing plow system that allows multiple traffic lanes to be cleared of snow and ice in a safe and efficient manner.

與 2022 年第三季相比，除雪訂單預訂量增加了 100% 以上，這部分業務的積壓量達到了有史以來的最高水準。這是非常好的成長，部分原因是我們新型寬翼犁系統的成功引入和快速接受，該系統允許以安全有效的方式清除多個車道上的冰雪。

Excavator and vacuum truck bookings were also sharply higher during the third quarter, and the utilization of our vacuum truck rental fleet remained excellent. Due to a strong prior year comparable, new orders for street sweepers and debris collectors were somewhat lower in the third quarter of 2022.

第三季挖土機和真空卡車的預訂量也大幅增加，我們的真空卡車租賃車隊的使用率仍然很高。由於去年的可比性強勁，2022 年第三季街道清潔機和垃圾收集機的新訂單略有下降。

With the better flow of truck chassis and other components, Industrial Equipment division sales grew nicely and efficiency improved. Sales in this division were up more than 23% compared to the third quarter of 2022. Third quarter operating income improved dramatically, and operating margin rebounded by over 500 basis points compared to the prior year third quarter.

隨著卡車底盤和其他零件的流通改善，工業設備部門的銷售額成長良好，效率也提高。與 2022 年第三季相比，該部門的銷售額成長了 23% 以上。第三季營業收入大幅提高，營業利潤率較去年第三季反彈超過 500 個基點。

We were also very pleased with the recently completed-acquisition of Royal Truck and Equipment, that will be integrated into the Industrial Equipment division as part of our sweeper and debris collection group. This is a company we've been in contact with for some time. They are a leader in the development and deployment of truck mounted attenuators and have helped significantly improve work crew safety through innovation and continuous development of their products.

我們也對最近完成的皇家卡車和設備收購感到非常高興，該收購將作為我們的清掃機和碎片收集集團的一部分併入工業設備部門。這是一家我們已經接觸了一段時間的公司。他們是卡車安裝衰減器開發和部署的領導者，並透過產品的創新和持續開發幫助顯著提高了工作人員的安全。

In summary, we remain optimistic regarding Alamo Group's future outlook. We were obviously pleased that in the third quarter, despite the headwinds discussed previously, the Vegetation Management division continued to perform very well. And as expected, the Industrial Equipment division continued to rapidly regain momentum lost during the pandemic and subsequent supply disruptions.

綜上所述，我們對 Alamo 集團的未來前景保持樂觀。我們顯然很高興的是，在第三季度，儘管存在前面討論的不利因素，但植被管理部門仍然表現出色。正如預期的那樣，工業設備部門繼續迅速恢復在大流行和隨後的供應中斷期間失去的動力。

We anticipate that investments by governmental entities will remain elevated and that the markets served by our Vegetation Management division will be stable for the remainder of 2023 and then gradually regain momentum in 2024. We also believe that the supply chain performance will continue to improve sequentially and will support solid sales growth and further improvement of operating efficiencies.

我們預計政府實體的投資將保持在較高水平，我們的植被管理部門服務的市場將在 2023 年剩餘時間內保持穩定，然後在 2024 年逐步恢復勢頭。我們也相信供應鏈績效將繼續持續改善，並且將支援銷售的穩健成長和營運效率的進一步提高。

This is a positive pattern for the company, and one that we believe will continue to support favorable financial development for the next few quarters as we continue to execute our strategy in a disciplined manner.

這對公司來說是一種積極的模式，我們相信，隨著我們繼續以嚴格的方式執行我們的策略，這種模式將繼續支持未來幾季的良好財務發展。

Before closing my remarks today, I'd like to thank our customers, our dealers, suppliers, our thousands of exceptional employees and our financial stakeholders for their continued support for the company. This concludes our prepared remarks. We're now ready to take your questions. Operator, please go ahead.

在結束今天的演講之前，我要感謝我們的客戶、經銷商、供應商、數千名優秀員工以及財務利益相關者對公司的持續支持。我們準備好的演講到此結束。我們現在準備好回答您的問題。接線員，請繼續。

(Operator Instructions) Our first question comes from Mike Shlisky with D.A. Davidson.

（操作員說明）我們的第一個問題來自 D.A. 的 Mike Shlisky。戴維森。

I'd like to -- let me start out with some commentary on the orders between the 2 segments. You had mentioned, and the press release said, backlogs were up a bit in Industrial, down a bit in Vegetation. Clearly, it was flat overall, and that's great to see in this environment. But the 2 segments have margin differences, and I'm curious if there will be a big margin headwind to mix over the next couple of quarters? Because the volumes that you have in Industrial especially with good margin business like a snow plow, does that allow for higher margin and perhaps a little bit more of easing out of the 2 segments margins over a period of time here?

我想——讓我先對這兩個部分之間的順序進行一些評論。您曾提到，新聞稿中也提到，工業領域的積壓訂單增加，植被領域的積壓訂單下降。顯然，整體上是平坦的，在這種環境下看到這一點真是太好了。但這兩個細分市場的利潤率存在差異，我很好奇在接下來的幾季中是否會出現很大的利潤率逆風？因為工業領域的銷售量，特別是像掃雪機這樣利潤率較高的業務，這是否允許更高的利潤率，並且在一段時間內可能會稍微放鬆這兩個細分市場的利潤率？

Yes. That's a very insightful question, Mike, and you're exactly right. That's how we see this unfolding. I think Vegetation Management can hold their margins for the next couple of quarters and gradually improve next year, as I said. But Industrial continues to gain momentum, and we're not where we can be in that division by any means yet. And then the nice story is snow removal, because it's a segment that's traditionally been a little bit dilutive for us from a margin point of view, but it's performing exceptionally well right now with higher backlogs as well, and I think that will tend to blend the industrial margins higher and keep on a good pace there.

是的。這是一個非常有洞察力的問題，麥克，你是完全正確的。這就是我們對事態發展的看法。正如我所說，我認為植被管理可以在接下來的幾個季度保持利潤，並在明年逐步改善。但工業部門繼續保持勢頭，但無論如何，我們還沒有達到該部門的目標。然後，不錯的故事是除雪，因為從利潤的角度來看，這個部分傳統上對我們來說有點稀釋，但它現在表現非常好，積壓也更高，我認為這往往會融合在一起工業利潤率更高，並保持良好的步伐。

So we think Industrial is still gaining momentum. They're not out of gas yet at all from any point of view with regard to the operating margin they can achieve, and so I don't really think you're going to see that dilution that you're thinking about. But it's a very insightful question.

因此，我們認為工業仍在成長動能。從任何角度來看，他們都還沒有耗盡營運利潤，所以我認為你不會看到你正在考慮的稀釋。但這是一個非常有洞察力的問題。

Great. Then a quick margin question for you. Have you given a lot of -- any thoughts to maybe upping those margin targets over the next few quarters? Clearly, one of your competitors, one of your largest competitors just upped their margin targets. I'd be curious. Your thought process there, Jeff.

偉大的。然後是一個快速的保證金問題。您是否考慮過在未來幾季提高這些利潤目標？顯然，您的競爭對手之一，您最大的競爭對手之一剛剛提高了他們的利潤目標。我很好奇。你的思考過程就在那裡，傑夫。

Yes. We're going to be discussing that. We're going to have our budget round starting actually next week, Mike, so we'll discuss that then after we've met with all the marketing teams, and then we'll give you our feedback on that.

是的。我們將討論這個問題。麥克，我們的預算輪實際上將於下週開始，所以我們將在與所有行銷團隊會面後討論這個問題，然後我們將向您提供回饋。

But as I said, as we get to 12 and we can stay there for a while, we'll bump it up again. I just had that conversation with our Board of Directors yesterday. So yes, I'm sure we will readjust it.

但正如我所說，當我們達到 12 點並且可以在那裡停留一段時間時，我們會再次提高它。我昨天剛與我們的董事會進行了談話。所以是的，我確信我們會重新調整它。

Great. Maybe one last one for me, maybe this is for Richard. Given where your business is heading over the next couple of quarters, as your comments indicated, and where things could go from an inventory and working capital perspective, I'm curious if you've got any room you think to maybe up the debt reduction over time given the current environment?

偉大的。也許最後一張是給我的，也許這是給理查德的。鑑於您的業務在未來幾個季度的發展方向（正如您的評論所示），以及從庫存和營運資金的角度來看，事情可能會走向何方，我很好奇您是否有任何可能增加債務削減的空間鑑於當前環境，隨著時間的推移？

Yes, Mike. I think we're anticipating that we will reduce debt some more here net-net debt. We pulled money internationally back at the end of the year to kind of pull it out of cash and go ahead and apply it to debt, but we only do 30-day notes on that. But true debt, we expect to drop here in the fourth quarter.

是的，麥克。我認為我們預計我們將進一步減少淨債務。我們在年底從國際上撤回資金，從現金中取出資金，然後將其用於債務，但我們只對此做 30 天的票據。但我們預計真實債務將在第四季下降。

I think Q1 is usually one where we actually will start increasing inventory levels just to start manufacturing, because all of our pre-season programs have come through. But I think if we can overall hold that or actually reduce a little bit in the first quarter, that's going to (inaudible) huge momentum for us going into Q2 and Q3 for next year. So our intent is to keep doing it, so.

我認為第一季我們通常會開始增加庫存水準以開始製造，因為我們所有的季前計劃都已經完成。但我認為，如果我們能夠整體上保持這一勢頭，或者在第一季實際減少一點，這將為我們進入明年第二季和第三季帶來（聽不清楚）巨大的動力。所以我們的目的是繼續這樣做。

Our next question comes from Chris Moore with CJS Securities.

我們的下一個問題來自 CJS 證券的 Chris Moore。

Congrats on a great quarter. To start, another question maybe on margins. So Industrial margins, obviously up significantly year-over-year and sequentially. Vegetation down a little bit sequentially but up year-over-year. I was just wondering, when you look out into '24, do you ever see those margins crossing? Is there a scenario where Industrial actually is a little bit better than Vegetation for a couple of quarters? Or is that not likely?

恭喜您度過了一個出色的季度。首先，另一個問題可能是邊緣問題。因此，工業利潤率與去年同期相比明顯大幅上升。植被環比略有下降，但較去年同期上升。我只是想知道，當你展望 24 年時，你是否看到這些邊緣交叉？是否有一種情況是工業實際上比植被好幾季？或者說這不太可能？

Chris, I'll tell you what I shared with our Board yesterday. I expect the margins in the 2 divisions to converge on the higher ground, if you know what I mean by that. So I think Vegetation Management will gradually even gain a little bit back because they've had to do some fairly significant incentives to move inventory out of the channel. I discussed that last quarter as well. And I see that tapering off, because that situation has showed nice improvement in the third quarter.

克里斯，我會告訴你我昨天與董事會分享的內容。如果你明白我的意思的話，我預計這兩個部門的利潤率將趨於較高的水平。因此，我認為植被管理將逐漸獲得一點回報，因為他們必須採取一些相當大的激勵措施將庫存移出管道。我上個季度也討論過這個問題。我看到這種情況正在逐漸減少，因為這種情況在第三季已經有了很大的改善。

And then as I said, Industrial is going to continue to gain momentum and ground on their margins. Their operating efficiencies are still not where they have been prior to pandemic, and the supply chain continues to improve. The mix in backlog is outstanding right now. It's really, really good in terms of price profile in the backlog. So as I said, I think they'll converge at the higher ground and pretty close, maybe a little bit above our targeted levels.

正如我所說，工業將繼續獲得動力並擴大其利潤率。他們的營運效率仍達不到疫情前的水平，供應鏈也持續改善。目前積壓的情況非常突出。就積壓訂單的價格情況而言，這真的非常非常好。正如我所說，我認為它們會在更高的地方匯聚，並且非常接近，也許比我們的目標水平略高一點。

Fantastic. You had previously talked about accounts receivable turnover potentially being an indicator, especially in Vegetation on the health of the sector. And I'm just wondering what you learned on that front in Q3?

極好的。您之前曾談到應收帳款週轉率可能是一個指標，尤其是在植被方面該行業的健康狀況。我只是想知道您在第三季在這方面學到了什麼？

Yes, Chris, this is Richard. From Vegetation, it held fine. We didn't -- we were a little bit concerned, but overall, it did well. Industrial, we had a few little hiccups during the quarter but they've ended up cleaning out here in October. Some of them where we had a little warranty issue on a couple of products, but other than that, no major problems on our DSOs and turning in the right direction, so.

是的，克里斯，這是理查。從植被來看，情況很好。我們沒有——我們有點擔心，但總的來說，它做得很好。工業方面，我們在本季遇到了一些小問題，但他們最終在 10 月清理了這裡。其中一些產品我們在一些產品上遇到了一些保固問題，但除此之外，我們的 DSO 沒有出現重大問題並且轉向正確的方向，所以。

Got it. And maybe the last one, just -- I mean pure ag is a small percentage of your overall Vegetation segment. I'm just wondering kind of what you're seeing on the more pure ag side?

知道了。也許最後一個，只是 - 我的意思是純農業只佔整個植被部分的一小部分。我只是想知道你在更純粹的農業方面看到了什麼？

Yes. It's kind of holding its own. The inventory level has got a lot of control during the second quarter, Chris, as we mentioned to you, but we did clear quite a bit of that out in Q3. And if you could see the bookings, we don't disclose that ag, but the bookings in ag were very encouraging in the third quarter and up very sharply from where they were in the second quarter. So that's a very bullish sign for how that sector is going to play out for us, and I think that will turn to revenue in the early quarters of next year. As I said, I think the middle of next year, we'll be in a much better position in ag.

是的。它有點像堅持​​自己的。克里斯，正如我們向您提到的那樣，庫存水平在第二季度得到了很大的控制，但我們在第三季度確實清除了相當多的庫存水平。如果你能看到預訂量，我們不會透露該 ag，但 ag 的預訂量在第三季度非常令人鼓舞，並且比第二季度的情況大幅上升。因此，這是一個非常樂觀的跡象，表明該行業將如何為我們發揮作用，我認為這將在明年早些時候轉化為收入。正如我所說，我認為明年年中，我們將在農業方面處於更好的位置。

Our next question comes from Greg Burns with Sidoti & Company.

我們的下一個問題來自 Sidoti & Company 的 Greg Burns。

So I understand the drivers of the areas of weakness in the Vegetation Management segment. But on the government piece, the side that's showing good growth, are there any specific drivers in particular driving the demand in that part of the business?

因此，我了解植被管理領域薄弱環節的驅動因素。但在政府方面，即顯示出良好成長的一面，是否有任何特定的驅動因素特別推動了這部分業務的需求？

I couldn't say there are anything, in particular, Greg. It's just the municipalities continue to be in very good shape because, as I said, the gains in Industrial go right across our product line and they do cross both division lines, by the way. The mowing side of our governmental business is in Vegetation Management, and that's still operating in record territory. Very high margins and very good backlog.

我不能說有什麼，特別是格雷格。只是直轄市繼續保持良好的狀態，因為正如我所說，工業領域的收益直接跨越了我們的產品線，順便說一句，它們確實跨越了兩條部門線。我們政府業務的割草部分是植被管理，而且仍在創紀錄地運作。非常高的利潤和非常好的積壓。

So I don't really see that changing for the time being. Municipalities are in good shape, but a really, really sharp downturn in housing would obviously impact property tax receipts, but that hasn't played out so far. Housing prices have remained elevated. So I don't see it changing in the near term, to be candid with you. And I still think there's a bit of catch-up buying from the pandemic going on.

所以我暫時認為這種情況不會改變。各市政府狀況良好，但房地產市場的真正急劇下滑顯然會影響財產稅收入，但到目前為止還沒有發揮作用。房價仍居高不下。因此，坦白說，我認為短期內情況不會改變。我仍然認為，大流行帶來了一些追趕性購買。

Okay. And then in terms of Royal Truck, how much -- I guess, what was our trailing 12-month revenue? And what kind of growth do that business have and margin profile?

好的。然後就 Royal Truck 而言，我猜我們過去 12 個月的收入是多少？該業務的成長和利潤狀況如何？

I think if you look at our 10-Q, we put in there the trailing 12 months is roughly about $44 million.

我想如果你看一下我們的 10-Q，我們會發現過去 12 個月的金額大約是 4400 萬美元。

And Greg, before you go, I'll add one more comment about Royal. They're continuing to gain momentum. We've been able to help them already with chassis supply, and I think that's going to help them pick up the pace here in the fourth quarter.

格雷格，在你離開之前，我會再補充一則關於皇家的評論。他們正在繼續獲得動力。我們已經能夠在底盤供應方面幫助他們，我認為這將有助於他們在第四季度加快步伐。

Okay. And I guess just one last one. I mean, is this a new vertical segment you're going to look to do additional acquisitions to scale up? Or does -- can Royal Truck stand on its own? Or how do you view that?

好的。我想只有最後一件。我的意思是，這是您打算進行額外收購以擴大規模的新垂直細分市場嗎？或者皇家卡車可以獨立存在嗎？或說您對此有何看法？

No, it's a very interesting segment. It's still quite fragmented, Greg, so it's an opportunity for us to do what we do, enter a new space and then kind of build out a position in it. We've been chasing Royal since 2016, believe it or not, so this was not opportunistic at all to bring this one into our family. We really like the space. We really like the people in this company, they're innovators. They're sort of the benchmark for on-highway safety to protect work crews. They're the company that always sets the bar higher, and the entrepreneur that started the company is personally known as a leader in that field.

不，這是一個非常有趣的部分。格雷格，它仍然相當分散，所以這對我們來說是一個機會，可以做我們所做的事情，進入一個新的空間，然後在其中建立一個位置。不管你信不信，我們自 2016 年以來一直在追逐 Royal，所以將這款產品帶入我們的家族絕非機會主義。我們真的很喜歡這個空間。我們真的很喜歡這家公司的員工，他們是創新者。它們是保護工作人員的公路安全基準。他們是一家總是設定更高標準的公司，而創辦這家公司的企業家個人也被認為是該領域的領導者。

So we really like Royal, and we were very pleased to finally get that acquisition across the line.

所以我們真的很喜歡 Royal，我們很高興最終完成了這項收購。

Our next question comes from Mig Dobre with Baird.

我們的下一個問題來自 Mig Dobre 和 Baird。

So I'm new to the story here. I'm still learning. I've got a number of questions. Hopefully, they're not going to be too basic here.

所以我對這裡的故事很陌生。我還在學習。我有很多問題。希望它們不會太基本。

But maybe the first one on Vegetation Management. Can you talk a little bit about seasonality here in terms of how your orders are coming through? I mean it's encouraging to see that year-over-year, that decline has stabilized, but in terms of how we're thinking about the sequential uptick? And also what normally happens with orders for this business in the fourth quarter?

但也許是第一個關於植被管理的。能否就訂單的處理方式談談季節性？我的意思是，看到同比下降趨勢趨於穩定是令人鼓舞的，但就我們如何看待連續上升而言？第四季該業務的訂單通常會發生什麼情況？

Yes, Mig, this is Richard. In a normal cadence environment with this type of business, they're a bit cyclical from a standpoint that they put up pre-season programs that start maybe late summer. And then different products, different groups, and then they'll go out for 60 days and then another one will pop up and they'll go out through November. So what they're trying to do is build their backlog of taking orders in so that allows us to manufacture those products through the fourth quarter and into the first quarter, where we're able to not just -- obviously just manufacture, but to make deliveries all the way through.

是的，米格，這是理查。在這類業務的正常節奏環境中，從他們制定可能從夏末開始的季前計劃的角度來看，他們有點週期性。然後是不同的產品、不同的群體，然後它們會上市 60 天，然後會出現另一種產品，它們會上市到 11 月。因此，他們正在努力做的是積壓訂單，以便我們能夠在第四季度和第一季生產這些產品，我們不僅能夠——顯然只是製造，而且能夠全程交貨。

That cadence does slow down a little bit as you move into Q2 and Q3 because a lot of farmer -- hobby farmers and ranchers are out working their properties, so they don't buy as many whole goods. They will buy some whole goods, but we get a bigger increase in parts sales during the second and the third quarter, which is why our margins actually peak up a little bit in the Vegetation Management division. So that's pretty much how it lines up for them.

當你進入第二季和第三季時，這種節奏確實會放緩一點，因為很多農民——業餘農民和牧場主都在外面耕種他們的土地，所以他們不會購買那麼多的完整商品。他們會購買一些整貨，但我們在第二季和第三季的零件銷售量出現了更大的成長，這就是為什麼我們的植被管理部門的利潤率實際上略有上升。這就是他們的情況。

And then what happens in the fourth quarter?

那麼第四季會發生什麼事呢？

Fourth quarter, they'll have pre-season programs, Mig, probably through until about November and then they'll shut it down. But that builds that backlog and it allows us to manufacture, so sales usually stay pretty steady through the fourth quarter from a whole goods standpoint. Parts will drop off a little bit during the fourth quarter and the first quarter.

第四季度，他們將進行季前賽，米格，可能會​​持續到十一月左右，然後他們就會關閉它。但這會增加積壓，使我們能夠進行製造，因此從整體商品的角度來看，第四季度的銷售通常保持相當穩定。第四季和第一季零件數量會略有下降。

Right. I guess what I'm trying to figure out here is what your expectations are in terms of backlog and book-to-bill exiting 2023? And related to the backlog, backlog has been coming down a bit. What do you sort of consider to be a normal level of backlog? At what point in time should we start thinking about your revenue needing to sort of closely match orders on a go-forward basis?

正確的。我想我在這裡想弄清楚的是，您對 2023 年積壓訂​​單和訂單到帳單的預期是什麼？與積壓相關的是，積壓已經下降。您認為積壓的正常值是多少？我們應該在什麼時間點開始考慮您的收入需要在未來的基礎上與訂單緊密匹配？

Yes. That revenue and backlog are already converging in that division, Mig, and the reason for the big fall in backlog wasn't the result of loss of orders, that was a result of order cancellations through Q2 and Q3. So -- and that was particularly notable in the forestry side. It had nothing to do with ag. There had been some speculative volume going on in forestry, most notably in the land clearing space. There's sort of (inaudible) Q2 and Q3, and of course, what we're reporting is net bookings at the end of the day.

是的。該部門的收入和積壓訂單已經趨同，Mig，積壓訂單大幅下降的原因不是訂單損失，而是第二季和第三季訂單取消的結果。所以——這在林業方面尤其值得注意。和ag沒有關係。林業領域出現了一些投機活動，尤其是在土地清理領域。有某種（聽不清楚）第二季度和第三季度，當然，我們報告的是當天結束時的淨預訂。

Now, forestry has started to tick back up a little bit, and we missed some shipments in Q3 and forestry due to the supply chain that have started to resolve now in Q4.

現在，林業已開始略有回升，由於供應鏈已在第四季度開始解決，我們錯過了第三季和林業的一些發貨。

So as Richard said, Q4 is normally a little bit softer for Vegetation Management because it's not their operating season, and the margins are typically a little bit higher in that segment in Q2 and Q3. But we're in a distorted situation at the moment because of the -- first of all, the results of the pandemic and the supply chain. But then followed by the inventory build or inventory bubble that built up in Q2, and to a lesser extent, in Q3, particularly in the ag space. That field inventory is now coming down, we're very pleased with that, so I think we're returning to a more normal cadence.

因此，正如理查德所說，對於植被管理來說，第四季度通常會比較疲軟，因為這不是他們的營運季節，而第二季和第三季該細分市場的利潤率通常會更高一些。但我們目前正處於一種扭曲的境地，因為首先是疫情和供應鏈的結果。但隨後是第二季的庫存增加或庫存泡沫，第三季的程度較小，特別是在農業領域。現場庫存現在正在下降，我們對此感到非常滿意，所以我認為我們正在恢復到更正常的節奏。

So normally, you can expect in the Vegetation Management side, Q4 will tick down just a little bit and the margins may tick down just a skosh because of the parts impact that Richard was talking about.

因此，通常情況下，您可以預期在植被管理方面，第四季度將略有下降，由於理查德談到的零件影響，利潤率可能會略有下降。

The wildcard here is the big ticket items in forestry. You ship $1 million machine, those are high-margin products for us out of Morbark, and we're going to pick up a few of those that we missed in Q3 (inaudible).

這裡的通配符是林業中的高價項目。您運送了 100 萬美元的機器，這些對我們來說是莫巴克的高利潤產品，我們將挑選一些我們在第三季度錯過的產品（聽不清楚）。

One other point too, Mig, on that is that just remember the backlog right now in the Vegetation Management is still about twice as big as it was pre-COVID. So it's doing really well, and it's holding up just fine. If you look at the small ag and hobby farmers, they did a bunch of COVID buying during 2021 and partially '22 that hasn't repeated itself just yet, so.

米格，還有一點是，請記住，目前植被管理中的積壓工作仍然是新冠疫情爆發前的兩倍左右。所以它的表現非常好，並且保持得很好。如果你看看小型農業和業餘農民，他們在 2021 年和部分 22 年期間進行了大量的新冠疫情購買，但這種情況尚未重演，所以。

But to be clear, in terms of normalized backlog in this business, would you consider 1 quarter's worth of shipments to be a normalized backlog? Is it more? Is it less? What's normal?

但需要明確的是，就該業務的標準化積壓而言，您是否會認為 1 季的出貨量是標準化積壓？還多嗎？是不是少了？什麼是正常的？

Yes. In the ag piece of that division, 1 quarter is normal. In forestry, it's more like 2. So it depends on the mix in the division between the 2, Mig. But yes, your thinking is right. It's about a quarter normally in ag, and then 2 quarters in forestry.

是的。在該部門的ag部分，1季是正常的。在林業中，它更像是 2。所以這取決於 2 之間的混合，Mig。但是，是的，你的想法是對的。農業產業通常約為四分之一，林業產業約為兩個季度。

If it gets much bigger than that, Mig, then you start pushing out past the deliveries more than 3 to 4 months, and that could be a problem. But actually, it's fine right now, as Jeff said.

如果它變得比這個大得多，Mig，那麼你就會開始將交貨期推遲 3 到 4 個月以上，這可能會成為一個問題。但實際上，正如傑夫所說，現在很好。

Understood. A couple of questions on Industrial too, if I may. The first one is on the supply chain where it sounds like things are getting better. You didn't talk about any impact from UAW, everything that's going on that side. Anything to comment on that end?

明白了。如果可以的話，我還有幾個關於工業的問題。第一個是供應鏈，聽起來情況正在好轉。你沒有談論 UAW 的任何影響，以及那邊發生的一切。對此有何評論？

Yes. I actually had a comment and then later took it out in my remarks, Mig, because I didn't think it was significant. We haven't really seen a meaningful impact from the UAW strike or its aftermath. The supply of these Class 3 to 5 chassis was tight even before the strike, and it remains tight. But some of these smaller sweeper contractors, that's really where we use these. And on the very low end of our snow removal business, there still were dealer inventories available so we've kind of scoured the country to buy up as much of that as we can, and we've been able to hold our own there. So I'm not really losing a lot of sleep on that, particularly with the strike now having resolved, to be candid.

是的。我實際上有一個評論，然後在我的評論中把它刪除了，米格，因為我認為它並不重要。我們還沒有真正看到 UAW 罷工或其後果產生有意義的影響。即使在罷工之前，這些 3 至 5 級機箱的供應就很緊張，並且仍然緊張。但我們確實在一些較小的清掃機承包商中使用它們。在我們除雪業務的低端，仍然有經銷商庫存可用，所以我們在全國範圍內搜尋盡可能多的庫存，並且我們能夠在那裡保持自己的庫存。因此，坦白說，我並沒有因此而失眠，特別是現在罷工已經解決。

Understood. Then the final question, and the guys before me were asking about margin, I will ask about margin as well. When recognizing the fact that you have a lot of backlog in this business, and obviously the supply chain, like you said, has gotten better. As we think about the fourth quarter, is it sort of reasonable to expect that revenue would be a similar level as Q3 or maybe better? And if that's the case, do we continue to see this trend that, frankly, you've put up for like 5 quarters in a row here of continued sequential improvement in margin? Q4 versus Q3?

明白了。然後是最後一個問題，在我之前的人問的是保證金，我也會問保證金。當認識到您在這項業務中有大量積壓的事實時，顯然供應鏈，正如您所說，已經變得更好了。當我們考慮第四季時，預期收入將與第三季相似或更好的水平是否合理？如果是這樣的話，坦白說，我們是否會繼續看到這種趨勢，您已經連續五個季度保持了利潤率持續連續改善的趨勢？ Q4 與 Q3？

Well, I'm certainly hoping so, Mig. And as I said, Industrial could normally tick down a little bit in Q4, but I don't think it will this year because of the behavior of snow removal. Our snow removal business is in uncharted territory in terms of size, scale, volume and profitability, and it hasn't begun to hit the stride yet, to be candid with you.

嗯，我當然希望如此，米格。正如我所說，工業通常會在第四季度略有下降，但我認為今年不會，因為除雪的情況。坦白說，我們的除雪業務在規模、規模、數量和盈利能力方面都處於未知領域，而且還沒有開始取得進展。

So we've got some new products that we get in a nice margin on. We're the only player in the market with those products, and I think we're really doing a good job capturing a nice bit of the share in that space. And we do supply the complete plow truck, including the chassis. We didn't always do that. That was a recent change in our strategy about a year ago. I think you and I spoke about that this time last year, Mig. That's really playing out very well for us.

因此，我們推出了一些新產品，並獲得了不錯的利潤。我們是市場上唯一擁有這些產品的參與者，我認為我們確實做得很好，在該領域佔據了相當大的份額。我們確實提供完整的犁車，包括底盤。我們並不總是這樣做。這是大約一年前我們策略的最新變化。我想你和我去年這個時候就談到過這個問題，米格。這對我們來說確實非常有效。

So I think so. I think we can set another record in the fourth quarter. I never guarantee anything, but I think Industrial has got some room to run here then. As I said, they're not out of gas from either a sales point of view or a margin point.

所以我想是的。我認為我們可以在第四季再創紀錄。我從不保證任何事情，但我認為工業公司在這裡還有一些運作空間。正如我所說，無論是從銷售角度還是從利潤角度來看，他們都沒有耗盡精力。

(Operator Instructions) Our next question comes from Tim Moore with EF Hutton.

（操作員說明）我們的下一個問題來自 EF Hutton 的 Tim Moore。

Congratulations on the impressive continued execution, and it was really nice to see that backlog hold up when the overall sector backlogs are rolling off from pretty much broad-based.

恭喜令人印象深刻的持續執行，當整個部門的積壓工作從相當廣泛的基礎上減少時，看到積壓工作保持不變真的很高興。

But my first question is about Industrial Equipment. It had a consecutive very large sales growth jump at 23%. Richard, I was just kind of curious if there's any way to quantify or parse out, maybe half that 23% growth was from the supply chain catch-up with the chassis and not as many subcomponent shortages? And if the other half might have been from just higher broad-based demand for the end markets? Any thoughts to maybe how that...

但我的第一個問題是關於工業設備的。銷售額連續大幅成長，增幅達 23%。理查德，我只是有點好奇是否有任何方法可以量化或解析，也許 23% 的增長有一半是來自供應鏈對底盤的追趕，而不是那麼多的子組件短缺？如果另一半可能只是來自終端市場廣泛的更高需求呢？任何想法也許如何.....

Yes, I think your latter comment is definitely there. I think probably the biggest thing that we continue to feel very comfortable with is our chassis deliveries. We're on consignment on all of our chassis deliveries, and that has really worked out extremely well for us. The component pieces, the component parts, it varies, but it has really improved a tremendous amount since Q1 of this year. Q2 got better, Q3 is even better.

是的，我認為你的後一條評論肯定存在。我認為我們仍然感到非常滿意的最重要的事情可能是我們的底盤交付。我們所有的底盤都是透過寄售方式交付的，這對我們來說確實非常有效。各個組成部分各不相同，但自今年第一季以來，它確實有了巨大的進步。 Q2 變得更好，Q3 甚至更好。

So I think the key to those is making sure that those come in a timely fashion, and we don't have to wait. That takes care of a lot of our under-absorption problems that we've been having in the past. And I think you remember we had that conversation in Q1, which is what really hurt us there. But overall, it's moving in the right direction. We just need to keep that consistency moving forward, and we should continue to see those margins going up.

所以我認為關鍵是確保這些及時到來，我們不必等待。這解決了我們過去遇到的許多吸收不足的問題。我想你還記得我們在第一季進行過那次談話，這才是真正傷害我們的地方。但總體而言，它正在朝著正確的方向發展。我們只需要保持這種一致性，我們應該繼續看到這些利潤率上升。

Great. That's helpful. And...

偉大的。這很有幫助。和...

Tim, it's Jeff here. I want to add a remark to that, if I could. The growth of our rental fleet in (inaudible) trucks has also been constrained by chassis supply. We're now starting to receive enough chassis that we can start really building that fleet again, which will help us from a profitability point of view and a sales point of view. So that's a very important change in sort of the cadence of industrial. That's been constrained very harshly by the chassis supply situation.

提姆，我是傑夫。如果可以的話，我想補充一點。我們（聽不清楚）卡車租賃車隊的成長也受到底盤供應的限制。我們現在開始收到足夠的底盤，我們可以再次開始真正建造該車隊，這將從盈利角度和銷售角度幫助我們。所以這是工業節奏的一個非常重要的變化。這受到底盤供應情況的嚴重限制。

And if you go back and look at the value of our fleet over the last couple of quarters, it's been really flat. So I'm optimistic now we'll start to get that fleet growing again, and that will help us from a profitability point of view.

如果你回頭看看過去幾季我們機隊的價值，你會發現它真的很平淡。因此，我現在很樂觀，我們將開始讓機隊再次成長，從獲利的角度來看，這將有助於我們。

That's a great point on the fleet. Just maybe switching gears to in-country production. Are the European plan expansions on track maybe for the U.K. and France? And do you plan on doing some expansion in Indiana or anywhere else?

這是艦隊的一個重要點。也許只是轉向國內生產。英國和法國的歐洲計劃擴張是否已步入正軌？您是否計劃在印第安納州或其他任何地方進行擴張？

The U.K. expansion is going very well. We're slightly ahead of schedule there right now. We were just discussing with our Board this week a further expansion of our vacuum truck facility in France, and we'll be making a fairly sizable investment there as well. So I think the timing of that is going as expected from our point of view.

英國的擴張進展順利。我們現在比計劃稍微提前了一些。本週我們剛與董事會討論了進一步擴大我們在法國的真空卡車工廠的問題，我們也將在那裡進行相當大的投資。因此，我認為從我們的角度來看，這個時間安排符合預期。

The Indiana plant doesn't need a lot of CapEx. It's already bigger than what we need for Dixie Chopper, but we are starting to accelerate the transfer of other products into that plant now because we do have a workforce available there. That hasn't really played out in our financials yet, Tim. I think you'll start to see that late Q1 and early Q2 of next year.

印第安納工廠不需要大量資本支出。它已經超出了我們對 Dixie Chopper 的需求，但我們現在開始加速將其他產品轉移到工廠，因為我們在那裡確實有勞動力。提姆，這還沒有真正體現在我們的財務狀況上。我想你會在明年第一季末和第二季初開始看到這一情況。

Great. That's really helpful. And maybe just switching gears on a topic that hasn't maybe come up in a little while, it was your electrification and hybrid launches seem to be more of a 2024 story. I think a lot of that seems to be driven just by the world changing and noise orient in cities away from diesel and fuel. Is there any kind of sneak preview you can give us? Some more penetration maybe of the hybrid Timberwolf chipper or the small Nite-Hawk sweeper or the Gen 2 Mantis or any type of other launches coming out next year? Or innovations?

偉大的。這真的很有幫助。也許只是換個話題，這個話題可能已經有一段時間沒有出現了，你們的電動化和混合動力車的推出似乎更像是 2024 年的故事。我認為這很大程度上是由世界的變化和城市遠離柴油和燃料的噪音導向所驅動的。您可以給我們任何形式的先睹為快嗎？也許是混合動力 Timberwolf 削片機、小型 Nite-Hawk 清掃機、Gen 2 Mantis 或明年推出的任何其他類型的產品？還是創新？

Yes. The official market introduction of Gen 2 Mantis is happening in Q4. That was held up by the supply of the engines. There was an engine certification process needed by the EPA that we finally got complete, so those engines now can be tagged as compliant. We have them in our hands. They can be tagged as compliant and we could start shipping. So that's beginning to ramp up.

是的。第二代 Mantis 將於第四季正式上市。這受到發動機供應的阻礙。我們最終完成了 EPA 所需的引擎認證流程，因此這些引擎現在可以標記為合規。我們手裡有它們。它們可以被標記為合規，我們可以開始出貨。所以這種情況開始加劇。

On the sweeper side, there's only a handful of electrified chassis coming out of the Daimler organization for next year. But we're getting most of them, which is a really pleasing sign of the relationship that we have with Daimler. So I think that's probably a back end of 2024 issue when you'll start to see those going to market in meaningful numbers.

在清掃車方面，戴姆勒組織明年將推出少數電動底盤。但我們得到了其中的大部分，這是我們與戴姆勒關係的一個非常令人愉快的跡象。因此，我認為這可能是 2024 年底的問題，屆時您將開始看到這些產品以有意義的數量進入市場。

The Nite-Hawk hybrid is just being introduced now. The reception has been tremendous to that. Really, really good. And we also have a hybrid version of our leaf vacuum trucks. It's been very well received in the market. So I think you'll start to see us actually putting a bit of product on the streets, let's say, second quarter next year. That's how I think this will play.

Nite-Hawk 混合動力車現在剛推出。對此，反應非常熱烈。真的，真的很好。我們還有混合動力版本的葉片真空卡車。它在市場上很受歡迎。因此，我認為您將開始看到我們實際上將一些產品推向市場，例如明年第二季。我認為這就是這樣的玩法。

That's helpful, Jeff. My last question is just, Richard pointed out and we've been watching the terrific free cash flow and the debt deleveraging and a very clean balance sheet. I mean it's very impressive. That Royal Truck acquisition seemed like a nice bolt-on. It adds on around maybe nearly 3% to your annual sales. Do you see -- as you look out maybe the next few quarters, do you have a preference on doing maybe a few more of those bolt-on acquisitions in the funnel? Or do you think that you would be ready to maybe do a larger strategic acquisition a couple of quarters out?

這很有幫助，傑夫。理查德指出，我的最後一個問題是，我們一直在關注出色的自由現金流、債務去槓桿化以及非常乾淨的資產負債表。我的意思是這非常令人印象深刻。收購皇家卡車似乎是個不錯的補充。它可為您的年銷售額增加約 3% 左右。你是否看到——當你展望未來幾季時，你是否傾向於在漏斗中進行更多的補強收購？或者您認為您準備好在幾個季度後進行更大規模的策略性收購？

We're ready to do a larger strategic acquisition right now. We just haven't found the right thing. So in the meantime, we're back to doing what we do. We're just making a steady diet of smaller things. We've got a couple of others in the pipeline that we're very excited about, and as I said, we were very, very patient with Royal. I remember when I was still running the Industrial division when I met the Royal folks for the first time years ago, so it was nice to see that one come.

我們現在準備進行更大規模的策略性收購。我們只是還沒有找到正確的東西。所以同時，我們又回到了我們所做的事情。我們只是穩定地吃一些小東西。我們還有其他幾個項目正在籌備中，我們對此感到非常興奮，正如我所說，我們對 Royal 非常非常有耐心。我記得幾年前我第一次見到皇室成員時，我還在管理工業部門，所以我很高興看到他們的到來。

But there's a couple of other tuck-ins like that we're in kind of the middling stages with that I think we'll see play out early next year. So we're just kind of doing what we do in there, waiting for something big, but we -- I'd like to become available. There hasn't been much come available in the forestry space that's been the right fit for us. And of course, we have to have something that we're not going to have issues with the federal government about from a market share point of view as well, Tim.

但還有其他一些類似的事情，我們正處於中間階段，我認為我們會在明年初看到結果。所以我們只是做我們在那裡做的事情，等待一些大事，但我們——我想成為可用的。林業領域還沒有太多適合我們的產品。當然，從市場佔有率的角度來看，我們也必須有一些不會與聯邦政府產生問題的東西，提姆。

This concludes our question-and-answer session. I would like to turn the conference back over to management for any closing remarks.

我們的問答環節到此結束。我想將會議轉交管理層發表閉幕詞。

All right. Again, thank you, everyone, for joining us on the call today and appreciate all the great questions that were put forward to us. We look forward to speaking with you again on our fourth quarter conference call in February of 2024. Thank you.

好的。再次感謝大家今天加入我們的電話會議，並感謝向我們提出的所有重要問題。我們期待在 2024 年 2 月的第四季度電話會議上再次與您交談。謝謝。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。