Equipment dealer Alta Equipment Group reported net revenues of $180.5 million in the first quarter compared to $102.3 million in the first quarter of 2019, a 76.4-percent increase with organic growth and contributions from acquisitions. Industrial revenues reached $94.6 million, and construction revenues were $85.9 million. Rental revenue was $25.2 million compared to $17 million a year ago, a 48.2-percent hike.
The company acquired Flagler CE Holdings and Liftech Equipment Companies in February 2020, expanding its geographic footprint and end-market diversity while scaling its partnerships with key OEMs. The product support business grew 11.3 percent organically in the first quarter over last year’s comparable quarter which provides a steady flow of recurring revenue at high margins
The number of service technicians increased by approximately 20 percent in Florida since the February 14th acquisition, as business activity in that region has continued at a near-normal pace and Alta has implemented an aggressive recruiting campaign for skilled labor.
On February 14, 2020, Alta’s predecessor, Alta Equipment Holdings Inc., and B. Riley Principal Merger Corp., a special purpose acquisition company sponsored by an affiliate of B. Riley Financial Inc., closed a business combination, through which Alta became a publicly traded company. The business combination provided net proceeds to Alta of $538 million, through a combination of equity and debt financings.
The company’s results for the first quarter of 2020 include Northland Industrial Truck Co., acquired in May 2019 and Flagler and Liftech which were acquired on February 14, 2020.
Net revenue increased to $181 million from $102 million in the first quarter of 2019. Gross profit grew to $47.1 million compared to $27.5 million. Net loss was $17 million primarily due to debt extinguishment and transaction costs related to business combination.
Adjusted EBITDA was $18.8 million compared to $15.1 million in the first quarter of 2019.
“I’m extremely proud of the incredible response to the COVID-19 pandemic from Alta’s one team culture,” said Ryan Greenawalt, Alta CEO. “Our first quarter financial results demonstrate the strength of our business model in terms of organic growth driven by our parts sales and service and the contributions of acquisitions. Our strategy to expand into new geographic markets and diversify our customer base has served us well during the current economic slowdown.
“Our experienced leaders took swift action to service customers, reduce costs and efficiently manage operations in response to shelter-in-place mandates that went into effect across many of our markets. Looking ahead, we believe we have ample liquidity and a strong capital structure to effectively navigate these current business conditions. We are confident in the resilience of our business model and believe the immediate actions we’ve implemented will allow us to emerge stronger as the economy begins to open and recover.”
