ALTA Equipment Group Reports 4.2% Revenue Decline and Increased Net Loss in Q1 2025

ALTA Equipment Group Inc. reported a decline in financial performance for the first quarter of 2025, with total revenues of $423.0 million, down from $441.6 million in the same period last year, representing a decrease of 4.2%. The company's net loss widened to $20.9 million, compared to a loss of $11.9 million in the prior year. This resulted in a basic loss per share of $0.65, compared to $0.38 in the first quarter of 2024. The decrease in revenue was primarily attributed to lower sales in new and used equipment, which fell to $221.7 million from $228.6 million, and a significant drop in rental revenues, which decreased from $48.5 million to $42.3 million.

In terms of operational metrics, ALTA's gross profit also declined to $115.0 million from $120.6 million, reflecting a gross profit margin of 27.2%, slightly down from 27.3% year-over-year. The company reported a decrease in selling, general, and administrative expenses to $106.7 million from $114.6 million, indicating some cost-saving measures were effective. However, the overall increase in interest expenses, particularly due to refinancing activities, contributed to the net loss. Interest expense rose to $21.0 million from $15.2 million, further impacting profitability.

Strategically, ALTA Equipment Group made a notable acquisition during the quarter, purchasing the assets of Les Chariots Elevateurs Du Quebec Inc. for $2.9 million. This acquisition is expected to enhance the company's presence in the Material Handling segment. Additionally, the company has been focusing on optimizing its rental fleet and has implemented cost-saving initiatives that have led to a reduction in headcount by over 6% compared to the previous year. The company also reported a significant increase in its rental equipment sales, which rose to $20.9 million, although this was offset by a decline in rental revenues.

Looking ahead, ALTA Equipment Group anticipates continued challenges in the market, particularly with the normalization of equipment deliveries post-COVID-19. The company is focusing on leveraging its existing customer base and exploring new relationships with equipment OEMs to drive organic growth. The management remains cautious about the economic environment and its impact on future operations, but they believe that their strategic initiatives and acquisitions will position the company for long-term growth. The company ended the quarter with $11.1 million in cash and significant borrowing capacity under its credit facilities, which it plans to utilize for future growth and operational needs.