STOCK TITAN

Generac Reports Third Quarter 2024 Results

Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Neutral)
Tags

Generac Holdings reported strong Q3 2024 financial results with net sales of $1.17 billion, up 10% year-over-year. Residential product sales increased 28% to $723 million, while Commercial & Industrial sales decreased 15% to $328 million. Net income rose to $114 million ($1.89 per share), compared to $60 million ($0.97 per share) in Q3 2023. The company generated strong cash flow from operations of $212 million and repurchased shares worth $102 million. Due to elevated power outage activity, Generac updated its full-year 2024 guidance, expecting net sales growth of 5-9% and adjusted EBITDA margin of 17.5-18.5%.

Generac Holdings ha riportato risultati finanziari solidi per il terzo trimestre del 2024, con vendite nette di 1,17 miliardi di dollari, in aumento del 10% rispetto all'anno precedente. Le vendite di prodotti residenziali sono aumentate del 28%, raggiungendo i 723 milioni di dollari, mentre le vendite commerciali e industriali sono diminuite del 15%, attestandosi a 328 milioni di dollari. Il reddito netto è salito a 114 milioni di dollari (1,89 dollari per azione), rispetto ai 60 milioni di dollari (0,97 dollari per azione) nel terzo trimestre del 2023. L'azienda ha generato un forte flusso di cassa operativo di 212 milioni di dollari e ha riacquistato azioni per un valore di 102 milioni di dollari. A causa dell'attività elevata di interruzioni di corrente, Generac ha aggiornato le previsioni per l'intero anno 2024, aspettandosi una crescita delle vendite nette compresa tra il 5% e il 9% e un margine EBITDA rettificato del 17,5% - 18,5%.

Generac Holdings reportó resultados financieros sólidos para el tercer trimestre de 2024, con ventas netas de 1.17 mil millones de dólares, un aumento del 10% en comparación con el año anterior. Las ventas de productos residenciales aumentaron un 28%, alcanzando los 723 millones de dólares, mientras que las ventas comerciales e industriales disminuyeron un 15%, totalizando 328 millones de dólares. La utilidad neta aumentó a 114 millones de dólares (1.89 dólares por acción), en comparación con 60 millones de dólares (0.97 dólares por acción) en el tercer trimestre de 2023. La empresa generó un fuerte flujo de caja operativo de 212 millones de dólares y recompró acciones por valor de 102 millones de dólares. Debido a la elevada actividad de cortes de energía, Generac actualizó su guía de ventas para todo el año 2024, esperando un crecimiento de ventas netas del 5% al 9% y un margen EBITDA ajustado del 17.5% al 18.5%.

Generac Holdings는 2024년 3분기 재무 실적을 발표하며 순매출 11억 7천만 달러를 기록했으며, 이는 전년 대비 10% 증가한 수치입니다. 주거용 제품 판매는 28% 증가하여 7억 2천 3백만 달러에 달했지만, 상업 및 산업 부문 판매는 15% 감소하여 3억 2천 8백만 달러를 기록했습니다. 순이익은 1억 1천4백만 달러(주당 1.89 달러)로 상승했으며, 이는 2023년 3분기 6천만 달러(주당 0.97 달러)에서 증가한 것입니다. 회사는 2억 1천2백만 달러의 견고한 운영 현금 흐름을 창출했으며, 1억 2천2백만 달러에 해당하는 주식을 재구매했습니다. 전력 정전 활동이 증가함에 따라, Generac은 2024년 전체 판매 성장률을 5-9% 예상하고 조정된 EBITDA 마진을 17.5-18.5%로 업데이트했습니다.

Generac Holdings a annoncé des résultats financiers solides pour le troisième trimestre 2024, avec des ventes nettes de 1,17 milliard de dollars, soit une augmentation de 10 % par rapport à l'année précédente. Les ventes de produits résidentiels ont augmenté de 28 % pour atteindre 723 millions de dollars, tandis que les ventes commerciales et industrielles ont diminué de 15 % pour s'établir à 328 millions de dollars. Le bénéfice net a grimpé à 114 millions de dollars (1,89 dollar par action), contre 60 millions de dollars (0,97 dollar par action) au troisième trimestre 2023. L'entreprise a généré un solide flux de trésorerie d'exploitation de 212 millions de dollars et a racheté des actions d'une valeur de 102 millions de dollars. En raison de l'activité accrue des coupures de courant, Generac a mis à jour ses prévisions pour l'année 2024, s'attendant à une croissance des ventes nettes de 5 à 9 % et à une marge EBITDA ajustée de 17,5 à 18,5 %.

Generac Holdings hat starke Finanzzahlen für das dritte Quartal 2024 veröffentlicht, mit Nettoverkaufszahlen von 1,17 Milliarden Dollar, was einem Anstieg von 10% im Vergleich zum Vorjahr entspricht. Verkäufe von Wohnprodukten stiegen um 28% auf 723 Millionen Dollar, während die Verkäufe im gewerblichen und industriellen Bereich um 15% auf 328 Millionen Dollar zurückgingen. Der Nettogewinn stieg auf 114 Millionen Dollar (1,89 Dollar pro Aktie), verglichen mit 60 Millionen Dollar (0,97 Dollar pro Aktie) im dritten Quartal 2023. Das Unternehmen erzielte einen starken operativen Cashflow von 212 Millionen Dollar und hat Aktien im Wert von 102 Millionen Dollar zurückgekauft. Aufgrund der erhöhten Aktivität bei Stromausfällen hat Generac seine Prognose für das gesamte Jahr 2024 aktualisiert und erwartet ein Nettovertriebswachstum von 5–9% sowie eine bereinigte EBITDA-Marge von 17,5–18,5%.

Positive
  • Net sales increased 10% YoY to $1.17 billion
  • Residential product sales grew 28% to $723 million
  • Net income nearly doubled to $114 million from $60 million YoY
  • Gross profit margin improved to 40.2% from 35.1%
  • Cash flow from operations increased to $212.3 million from $140.1 million
  • Raised full-year 2024 guidance for sales growth and EBITDA margin
Negative
  • Commercial & Industrial product sales declined 15% to $328 million
  • International segment sales decreased 20% to $166.7 million
  • Operating expenses increased 12.0% compared to Q3 2023

Insights

The Q3 results showcase impressive performance with $1.17 billion in revenue, up 10% year-over-year. Key highlights include 28% growth in residential product sales to $723 million and significant margin expansion, with gross profit margin reaching 40.2%. Net income nearly doubled to $114 million, while adjusted EBITDA margin improved to 19.8%.

Strong cash flow generation is particularly noteworthy, with operating cash flow of $212 million and robust free cash flow of $184 million. The company's share buyback program remains active, with $347 million still available. The increased full-year guidance, projecting 5-9% revenue growth and improved EBITDA margins of 17.5-18.5%, signals management's confidence in continued momentum.

The surge in power outage incidents through 2024 has created a robust demand environment for Generac's residential products. This trend, coupled with grid vulnerability concerns and the transition to renewable energy sources, establishes a strong long-term growth narrative. However, the 15% decline in C&I product sales to $328 million indicates market segmentation challenges.

The international segment's 20% revenue decline highlights geographical risks, particularly in Europe. Yet, domestic market strength, especially in home standby and portable generators, demonstrates the company's core market resilience. The recent impacts of Hurricanes Helene and Milton further validate the growing market opportunity in backup power solutions.

Return to robust overall sales growth with continued margin expansion; increasing 2024 outlook due to recent major outage events

WAUKESHA, Wis., Oct. 31, 2024 (GLOBE NEWSWIRE) -- Generac Holdings Inc. (NYSE: GNRC) (“Generac” or the “Company”), a leading global designer and manufacturer of energy technology solutions and other power products, today reported financial results for its third quarter ended September 30, 2024 and provided an update on its outlook for the full-year 2024.

Third Quarter 2024 Highlights

  • Net sales were $1.17 billion during the third quarter of 2024 as compared to $1.07 billion in the prior-year third quarter, an increase of approximately 10%. Core sales, which excludes both the impact of acquisitions and foreign currency, increased approximately 9% from the prior year period.
    • Residential product sales increased approximately 28% to $723 million as compared to $565 million last year.
    • Commercial & Industrial (“C&I”) product sales decreased approximately 15% to $328 million as compared to $385 million in the prior year.
  • Net income attributable to the Company during the third quarter was $114 million, or $1.89 per share, as compared to $60 million, or $0.97 per share, for the same period of 2023.
  • Adjusted net income attributable to the Company, as defined in the accompanying reconciliation schedules, was $136 million, or $2.25 per share, as compared to $102 million, or $1.64 per share, in the third quarter of 2023.
  • Adjusted EBITDA before deducting for noncontrolling interests, as defined in the accompanying reconciliation schedules, was $232 million, or 19.8% of net sales, as compared to $189 million, or 17.6% of net sales, in the prior year.
  • Cash flow from operations was $212 million during the third quarter, as compared to $140 million in the prior year. Free cash flow, as defined in the accompanying reconciliation schedules, was $184 million as compared to $117 million in the third quarter of 2023.
  • The Company repurchased 690,711 shares of its common stock during the third quarter for approximately $102 million. There is approximately $347 million remaining under the current repurchase program as of September 30, 2024.
  • The Company is updating its overall net sales growth guidance for the full-year 2024 to be 5 to 9% compared to the prior year on an as-reported basis, an increase from the previous guidance range of 4 to 8%. Adjusted EBITDA margin, before deducting for non-controlling interests, is now expected to be 17.5 to 18.5% as compared to the previous expectation of 17.0 to 18.0%.

“Our third quarter results outperformed our expectations as elevated power outage activity drove increased shipments of our residential products and strong execution helped to deliver significant margin expansion,” said Aaron Jagdfeld, President and Chief Executive Officer. “Shipments of home standby and portable generators increased at a very strong rate from the prior year period, more than offsetting expected softness in C&I product sales. As a result, we are updating our full year 2024 guidance to include higher residential product sales with further improvements in adjusted EBITDA margins.”

Jagdfeld continued, “The vulnerability of our nation’s electrical grid has never been more evident with the U.S. experiencing the highest level of power outage hours through the first nine months of the year since we began tracking outage data in 2010. In addition to more volatile weather, the rapid adoption of renewable, intermittent power generation sources and accelerating demand for electricity will likely lead to additional stresses on our aging grid. The elevated outage activity and growing grid related supply-demand imbalances are expected to drive both continued near-term demand as well as long-term awareness of the growing need for backup power products.”

Additional Third Quarter 2024 Consolidated Highlights

Gross profit margin was 40.2% as compared to 35.1% in the prior-year third quarter. The increase in gross margin was primarily driven by favorable sales mix and lower input costs.

Operating expenses increased $32.6 million, or 12.0%, as compared to the third quarter of 2023. The growth in operating expenses was primarily driven by increased employee costs to support future growth, additional marketing spend to drive incremental awareness for our products, and higher variable expenses and incentive compensation given higher shipment volumes and profitability. This was partially offset by a $22.1 million provision for certain legal matters that was recorded in the prior year which did not repeat in the current year period.

Provision for income taxes for the current year quarter was $33.5 million, or an effective tax rate of 22.7%, as compared to $19.4 million, or a 24.3% effective tax rate, for the prior year. The decrease in effective tax rate was primarily driven by certain unfavorable discrete tax items in the prior year quarter that did not repeat in the current year.

Cash flow from operations was $212.3 million during the third quarter, as compared to $140.1 million in the prior year. Free cash flow, as defined in the accompanying reconciliation schedules, was $183.7 million as compared to $117.4 million in the third quarter of 2023. The increase was primarily due to higher operating earnings and a greater reduction in primary working capital as compared to the prior year.

Business Segment Results

Domestic Segment

Domestic segment total sales (including inter-segment sales) increased 14% to $1.02 billion as compared to $894.0 million in the prior year, including a slight benefit from acquisitions. This was primarily driven by strong shipments of home standby and portable generators, as well as continued growth in C&I product sales to industrial distributors, partially offset by lower C&I product shipments for telecom, rental, and “beyond standby” applications.

Adjusted EBITDA for the segment was $211.6 million, or 20.7% of domestic segment total sales, as compared to $160.3 million, or 17.9% of total sales, in the prior year. This margin improvement was primarily due to favorable sales mix and lower input costs, partially offset by higher operating expense investments to support future growth initiatives.

International Segment

International segment total sales (including inter-segment sales) decreased 20% to $166.7 million as compared to $207.6 million in the prior year quarter, including a slight unfavorable impact from foreign currency. The core total sales decline was primarily due to lower inter-segment sales related to softness in the telecom market and a decline in shipments of portable generators and C&I products in Europe due to weaker market conditions.

Adjusted EBITDA for the segment, before deducting for noncontrolling interests, was $20.3 million, or 12.2% of international segment total sales, as compared to $28.3 million, or 13.6% of total sales, in the prior year. This margin decline was primarily due to reduced operating leverage on lower shipments during the quarter.

2024 Outlook

As a result of higher than previously expected power outage activity, including the impact of Hurricane Helene and Hurricane Milton, the Company is increasing its full-year 2024 net sales guidance. The Company now expects full-year 2024 net sales growth between 5 to 9% as compared to the prior year, an increase from the previous outlook of 4 to 8%. By product class, this updated net sales guidance considers an outsized increase in Residential product sales, partially offset by softer market conditions for C&I and Other product sales in certain end markets and geographies.

Additionally, the Company now expects net income margin, before deducting for non-controlling interests, to be approximately 7.0 to 8.0% for the full-year 2024 as compared to the prior expectation of 6.5 to 7.5%. The corresponding adjusted EBITDA margin is now expected to be approximately 17.5 to 18.5% as compared to the previous guidance range of 17.0 to 18.0%.

The Company continues to expect strong operating and free cash flow generation for the full year, with free cash flow conversion from adjusted net income well above 100%.

Conference Call and Webcast

Generac management will hold a conference call at 10:00 a.m. EDT on Thursday, October 31, 2024 to discuss third quarter 2024 operating results. The conference call can be accessed at the following link: https://register.vevent.com/register/BIabec574e36cc43abb7ea58d0150702c4. Individuals who wish to listen via telephone will be given dial-in information.

The conference call will also be webcast simultaneously on Generac's website (http://www.generac.com), accessed under the Investor Relations link. The webcast link will be made available on the Company’s website prior to the start of the call within the Events section of the Investor Relations website.

Following the live webcast, a replay will be available on the Company’s website for 12 months.

About Generac

Founded in 1959, Generac is a leading global designer, manufacturer, and provider of a wide range of energy technology solutions. The Company provides power generation equipment, energy storage systems, energy management devices & solutions, and other power products serving the residential, light commercial, and industrial markets. Generac introduced the first affordable backup generator and later created the automatic home standby generator category. The Company has continued to expand its energy technology offerings in its mission to lead the evolution to more resilient, efficient, and sustainable energy solutions.

Forward-looking Information

Certain statements contained in this news release, as well as other information provided from time to time by Generac Holdings Inc. or its employees, may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Forward-looking statements give Generac's current expectations and projections relating to the Company's financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "anticipate," "estimate," "expect," "forecast," "project," "plan," "intend," "believe," "confident," "may," "should," "can have," "likely," "future," "optimistic" and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events.

Any such forward-looking statements are not guarantees of performance or results, and involve risks, uncertainties (some of which are beyond the Company's control) and assumptions. Although Generac believes any forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect Generac's actual financial results and cause them to differ materially from those anticipated in any forward-looking statements, including:

  • fluctuations in cost, availability, and quality of raw materials, key components and labor required to manufacture our products;
  • our dependence on a small number of contract manufacturers and component suppliers, including single-source suppliers;
  • our ability to protect our intellectual property rights or successfully defend against third party infringement claims;
  • increase in product and other liability claims, warranty costs, recalls, or other claims;
  • significant legal proceedings, claims, fines, penalties, tax assessments, lawsuits or government investigations;
  • our ability to consummate our share repurchase programs;
  • our failure or inability to adapt to, or comply with, current or future changes in applicable laws and regulations;
  • scrutiny regarding our ESG practices;
  • our ability to develop and enhance products and gain customer acceptance for our products;
  • frequency and duration of power outages impacting demand for our products;
  • changes in durable goods spending by consumers and businesses or other macroeconomic conditions, impacting demand for our products;
  • our ability to accurately forecast demand for our products and effectively manage inventory levels relative to such forecast;
  • our ability to remain competitive;
  • our dependence on our dealer and distribution network;
  • market reaction to changes in selling prices or mix of products;
  • loss of our key management and employees;
  • disruptions from labor disputes or organized labor activities;
  • our ability to attract and retain employees;
  • disruptions in our manufacturing operations;
  • changes in U.S. trade policy;
  • the possibility that the expected synergies, efficiencies and cost savings of our acquisitions, divestitures, restructurings, or realignments will not be realized, or will not be realized within the expected time period;
  • risks related to sourcing components in foreign countries;
  • compliance with environmental, health and safety laws and regulations;
  • government regulation of our products;
  • failures or security breaches of our networks, information technology systems, or connected products;
  • our ability to make payments on our indebtedness;
  • terms of our credit facilities that may restrict our operations;
  • our potential need for additional capital to finance our growth or refinancing our existing credit facilities;
  • risks of impairment of the value of our goodwill and other indefinite-lived assets;
  • volatility of our stock price; and
  • potential tax liabilities.

Should one or more of these risks or uncertainties materialize, Generac's actual results may vary in material respects from those projected in any forward-looking statements. A detailed discussion of these and other factors that may affect future results is contained in Generac's filings with the U.S. Securities and Exchange Commission (“SEC”), particularly in the Risk Factors section of the 2023 Annual Report on Form 10-K and in its periodic reports on Form 10-Q. Stockholders, potential investors and other readers should consider these factors carefully in evaluating the forward-looking statements.

Any forward-looking statement made by Generac in this press release speaks only as of the date on which it is made. Generac undertakes no obligation to update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.

Non-GAAP Financial Metrics

Core Sales

The Company references core sales to further supplement Generac's condensed consolidated financial statements presented in accordance with U.S. GAAP. Core sales excludes the impact of acquisitions and fluctuations in foreign currency translation. Management believes that core sales facilitates easier and more meaningful comparison of net sales performance with prior and future periods.

Adjusted EBITDA

To supplement Generac’s condensed consolidated financial statements presented in accordance with U.S. GAAP, the Company provides the computation of Adjusted EBITDA attributable to the Company, which is defined as net income before noncontrolling interests adjusted for the following items: interest expense, depreciation expense, amortization of intangible assets, income tax expense, certain non-cash gains and losses including certain purchase accounting adjustments and contingent consideration adjustments, share-based compensation expense, certain transaction costs and credit facility fees, business optimization expenses, provision for certain legal and regulatory charges, certain specific provisions, mark-to-market gains and losses on a minority investment, and Adjusted EBITDA attributable to noncontrolling interests, as set forth in the reconciliation table below. The computation of Adjusted EBITDA is based primarily on the definition included in our Credit Agreement.

Adjusted Net Income

To further supplement Generac's condensed consolidated financial statements presented in accordance with U.S. GAAP, the Company provides a summary to show the computation of adjusted net income attributable to the Company. Adjusted net income attributable to the Company is defined as net income before noncontrolling interests adjusted for the following items: amortization of intangible assets, amortization of deferred financing costs and original issue discount related to the Company's debt, intangible impairment charges, certain transaction costs and other purchase accounting adjustments, business optimization expenses, provision for certain legal and regulatory charges, certain specific provisions, mark-to-market gains and losses on a minority investment, other non-cash gains and losses, and adjusted net income attributable to non-controlling interests.

Free Cash Flow

In addition, the Company references free cash flow to further supplement Generac's condensed consolidated financial statements presented in accordance with U.S. GAAP. Free cash flow is defined as net cash provided by operating activities, plus proceeds from beneficial interests in securitization transactions, less expenditures for property and equipment, and is intended to be a measure of operational cash flow taking into account additional capital expenditure investment into the business.

The presentation of this additional information is not meant to be considered in isolation of, or as a substitute for, results prepared in accordance with U.S. GAAP. Please see the accompanying Reconciliation Schedules and our SEC filings for additional discussion of the basis for Generac's reporting of Non-GAAP financial measures, which includes why the Company believes these measures provide useful information to investors and the additional purposes for which management uses the non-GAAP financial information.

SOURCE: Generac Holdings Inc.

CONTACT:
Kris Rosemann
Director – Corporate Development & Investor Relations
(262) 506-6064
InvestorRelations@generac.com

 
Generac Holdings Inc.
Condensed Consolidated Balance Sheets
(U.S. Dollars in Thousands, Except Share and Per Share Data)
(Unaudited)
    
 September 30, December 31,
 2024 2023
Assets   
Current assets:   
Cash and cash equivalents$214,177  $200,994 
Accounts receivable, less allowance for credit losses of $34,489 and $33,925 at September 30, 2024 and December 31, 2023, respectively 658,649   537,316 
Inventories 1,095,758   1,167,484 
Prepaid expenses and other current assets 104,791   91,898 
Total current assets 2,073,375   1,997,692 
    
Property and equipment, net 639,733   598,577 
    
Customer lists, net 166,016   184,513 
Patents and technology, net 391,841   417,441 
Other intangible assets, net 21,419   27,127 
Tradenames, net 210,308   216,995 
Goodwill 1,454,172   1,432,384 
Deferred income taxes 12,179   15,532 
Operating lease and other assets 217,896   203,051 
Total assets$5,186,939  $5,093,312 
    
Liabilities and stockholders’ equity   
Current liabilities:   
Short-term borrowings$65,540  $81,769 
Accounts payable 424,812   340,719 
Accrued wages and employee benefits 78,209   54,970 
Accrued product warranty 60,377   65,298 
Other accrued liabilities 291,360   292,120 
Current portion of long-term borrowings and finance lease obligations 99,176   45,895 
Total current liabilities 1,019,474   880,771 
    
Long-term borrowings and finance lease obligations 1,360,637   1,447,553 
Deferred income taxes 62,260   90,012 
Deferred revenue 186,465   167,008 
Operating lease and other long-term liabilities 145,641   158,349 
Total liabilities 2,774,477   2,743,693 
    
Redeemable noncontrolling interest -   6,549 
    
Stockholders’ equity:   
Common stock, par value $0.01, 500,000,000 shares authorized, 73,646,420 and 73,195,055 shares issued at September 30, 2024 and December 31, 2023, respectively 736   733 
Additional paid-in capital 1,115,525   1,070,386 
Treasury stock, at cost, 14,149,513 and 13,057,298 shares at September 30, 2024 and December 31, 2023, respectively (1,192,435)  (1,032,921)
Excess purchase price over predecessor basis (202,116)  (202,116)
Retained earnings 2,715,716   2,519,313 
Accumulated other comprehensive loss (27,987)  (15,143)
Stockholders’ equity attributable to Generac Holdings Inc. 2,409,439   2,340,252 
Noncontrolling interests 3,023   2,818 
Total stockholders’ equity 2,412,462   2,343,070 
Total liabilities and stockholders’ equity$5,186,939  $5,093,312 
    



Generac Holdings Inc.
Condensed Consolidated Statements of Comprehensive Income
(U.S. Dollars in Thousands, Except Share and Per Share Data)
(Unaudited)
      
 Three Months Ended September 30, Nine Months Ended September 30,
 2024 2023 2024 2023
        
Net sales$1,173,563  $1,070,667  $3,061,033  $2,958,997 
Costs of goods sold 701,294   694,880   1,896,824   1,982,290 
Gross profit 472,269   375,787   1,164,209   976,707 
        
Operating expenses:       
Selling and service 145,310   117,929   382,049   334,360 
Research and development 56,936   43,312   160,342   129,074 
General and administrative 77,242   83,052   209,392   199,108 
Amortization of intangibles 24,157   26,718   73,698   78,934 
Total operating expenses 303,645   271,011   825,481   741,476 
Income from operations 168,624   104,776   338,728   235,231 
        
Other (expense) income:       
Interest expense (22,910)  (24,707)  (69,833)  (72,862)
Investment income 1,757   1,160   5,286   2,789 
Change in fair value of investment 5,198   -   (2,938)  - 
Loss on extinguishment of debt (4,861)  -   (4,861)  - 
Other, net (577)  (1,167)  (1,949)  (1,664)
Total other expense, net (21,393)  (24,714)  (74,295)  (71,737)
        
Income before provision for income taxes 147,231   80,062   264,433   163,494 
Provision for income taxes 33,453   19,428   65,124   43,184 
Net income 113,778   60,634   199,309   120,310 
Net income attributable to noncontrolling interests 36   257   220   2,305 
Net income attributable to Generac Holdings Inc. 113,742   60,377   199,089   118,005 
        
Net income attributable to common shareholders per common share - basic:$1.91  $0.98  $3.29  $1.74 
Weighted average common shares outstanding - basic: 59,493,640   61,368,440   59,720,597   61,552,949 
        
Net income attributable to common shareholders per common share - diluted:$1.89  $0.97  $3.25  $1.72 
Weighted average common shares outstanding - diluted: 60,312,393   62,091,163   60,475,478   62,362,743 
        
Comprehensive income attributable to Generac Holdings Inc.$129,284  $37,041  $186,245  $141,463 
        



Generac Holdings Inc.
Condensed Consolidated Statements of Cash Flows
(U.S. Dollars in Thousands)
(Unaudited)
    
 Nine Months Ended September 30,
 2024 2023
Operating activities   
Net income$199,309  $120,310 
Adjustments to reconcile net income to net cash provided by operating activities:   
Depreciation 54,236   45,215 
Amortization of intangible assets 73,698   78,934 
Amortization of capitalized debt fees and original issue discount 2,592   2,902 
Change in fair value of investment 2,938   - 
Loss on extinguishment of debt 4,861   - 
Deferred income taxes (23,546)  (18,715)
Share-based compensation expense 38,270   30,306 
Gain on disposal of assets (34)  (538)
Other noncash charges 2,904   380 
Excess tax benefits from equity awards (642)  (920)
Net changes in operating assets and liabilities, net of acquisitions:   
Accounts receivable (120,137)  (68,975)
Inventories 73,390   101,894 
Other assets (4,348)  32,175 
Accounts payable 87,343   (57,866)
Accrued wages and employee benefits 22,482   10,244 
Other accrued liabilities (11,469)  (70,622)
Net cash provided by operating activities 401,847   204,724 
    
Investing activities   
Proceeds from sale of property and equipment 144   1,933 
Proceeds from beneficial interests in securitization transactions -   2,533 
Contribution to tax equity investment (1,629)  (6,627)
Purchase of long-term investments (37,118)  (2,592)
Proceeds from sale of long-term investment 2,000   - 
Expenditures for property and equipment (83,399)  (77,718)
Acquisition of businesses, net of cash acquired (21,784)  (15,974)
Net cash used in investing activities (141,786)  (98,445)
    
Financing activities   
Proceeds from short-term borrowings 29,219   49,078 
Proceeds from long-term borrowings 506,465   345,384 
Repayments of short-term borrowings (48,868)  (25,910)
Repayments of long-term borrowings and finance lease obligations (560,644)  (233,101)
Stock repurchases (152,743)  (100,267)
Payment of debt issuance costs (3,616)  - 
Payment of contingent acquisition consideration -   (4,979)
Payment of deferred acquisition consideration (7,361)  - 
Purchase of additional ownership interest (9,117)  (104,844)
Taxes paid related to equity awards (12,268)  (10,068)
Proceeds from the exercise of stock options 12,366   7,139 
Net cash used in financing activities (246,567)  (77,568)
    
Effect of exchange rate changes on cash and cash equivalents (311)  91 
    
Net increase in cash and cash equivalents 13,183   28,802 
Cash and cash equivalents at beginning of period 200,994   132,723 
Cash and cash equivalents at end of period$214,177  $161,525 
    



Generac Holdings Inc.
Segment Reporting and Product Class Information
(U.S. Dollars in Thousands)
(Unaudited)
            
 Total Sales by Reportable Segment
 Three Months Ended September 30, 2024 Three Months Ended September 30, 2023
 External Net
Sales
 Intersegment
Sales
 Total Sales External Net
Sales
 Intersegment
Sales
 Total Sales
Domestic$1,011,347 $8,853  $1,020,200  $886,365 $7,640  $894,005 
International 162,216  4,485   166,701   184,302  23,293   207,595 
Intercompany elimination -  (13,338)  (13,338)  -  (30,933)  (30,933)
Total net sales$1,173,563 $-  $1,173,563  $1,070,667 $-  $1,070,667 
            
            
 Total Sales by Reportable Segment
 Nine Months Ended September 30, 2024 Nine Months Ended September 30, 2023
 External Net
Sales
 Intersegment
Sales
 Total Sales External Net
Sales
 Intersegment
Sales
 Total Sales
Domestic$2,541,242 $26,571  $2,567,813  $2,395,292 $33,960  $2,429,252 
International 519,791  18,127   537,918   563,705  84,078   647,783 
Intercompany elimination -  (44,698)  (44,698)  -  (118,038)  (118,038)
Total net sales$3,061,033 $-  $3,061,033  $2,958,997 $-  $2,958,997 
            
            
 External Net Sales by Product Class    
 Three Months Ended September 30, Nine Months Ended September 30,    
 2024 2023 2024 2023    
Residential products$722,787 $565,087  $1,690,136  $1,482,538    
Commercial & industrial products 327,956  384,533   1,026,095   1,131,876    
Other 122,820  121,047   344,802   344,583    
Total net sales$1,173,563 $1,070,667  $3,061,033  $2,958,997    
            
 Adjusted EBITDA by Reportable Segment    
 Three Months Ended September 30, 2024 Nine Months Ended September 30,    
 2024 2023 2024 2023    
Domestic$211,567 $160,270  $450,416  $331,134    
International 20,298  28,332   73,371   94,088    
Total adjusted EBITDA (1)$231,865 $188,602  $523,787  $425,222    
            
(1) See reconciliation of Adjusted EBITDA to Net income attributable to Generac Holdings Inc. on the following reconciliation schedule.
            


Generac Holdings Inc.
Reconciliation Schedules
(U.S. Dollars in Thousands, Except Share and Per Share Data)
(Unaudited)
                
Net income to Adjusted EBITDA reconciliation       
 Three Months Ended September 30, Nine Months Ended September 30,
 2024 2023 2024 2023
        
Net income attributable to Generac Holdings Inc.$113,742  $60,377  $199,089  $118,005 
Net income attributable to noncontrolling interests 36   257   220   2,305 
Net income 113,778   60,634   199,309   120,310 
Interest expense 22,910   24,707   69,833   72,862 
Depreciation and amortization 43,152   42,951   127,934   124,149 
Provision for income taxes 33,453   19,428   65,124   43,184 
Non-cash write-down and other adjustments (1) 468   2,055   2,863   (5,257)
Non-cash share-based compensation expense (2) 13,115   9,927   38,270   30,306 
Transaction costs and credit facility fees (3) 1,337   921   4,029   3,161 
Business optimization and other charges (4) 1,564   5,291   3,190   8,151 
Provision for legal, regulatory, and clean energy product charges (5) 2,382   22,113   5,280   27,913 
Change in fair value of investment (6) (5,198)  -   2,938   - 
Loss on extinguishment of debt (7) 4,861   -   4,861   - 
Other 43   575   156   443 
Adjusted EBITDA 231,865   188,602   523,787   425,222 
Adjusted EBITDA attributable to noncontrolling interests 81   493   521   4,146 
Adjusted EBITDA attributable to Generac Holdings Inc.$231,784  $188,109  $523,266  $421,076 
        
(1) Includes (gains)/losses on the disposition of assets other than in the ordinary course of business, (gains)/losses on sales of certain investments, unrealized mark-to-market adjustments on commodity contracts, certain foreign currency related adjustments, and certain purchase accounting and contingent consideration adjustments. A full description of these and the other reconciliation adjustments contained in these schedules is included in Generac's SEC filings.
        
(2) Represents share-based compensation expense to account for stock options, restricted stock, and other stock awards over their respective vesting periods.
        
(3) Represents transaction costs incurred directly in connection with any investment, as defined in our credit agreement, equity issuance or debt issuance or refinancing, together with certain fees relating to our senior secured credit facilities, such as administrative agent fees and credit facility commitment fees under our Amended Credit Agreement.
        
(4) Represents severance and other restructuring charges related to the consolidation of certain operating facilities and organizational functions.
        
(5) Represents the following significant and unusual charges not indicative of our ongoing operations:
• A provision for judgments, settlements, and legal expenses related to certain patent and securities lawsuits - $2.4 million in the third quarter of 2024; $4.9 million year-to-date 2024; and $22.1 million in the third quarter of 2023.
• Additional customer support costs related to a clean energy product customer that filed for bankruptcy in 2022 – $0.4 million in the first quarter of 2024.
• A provision for a matter with the Consumer Product Safety Commission ("CPSC") concerning the imposition of civil fines for allegedly failing to timely submit a report under the Consumer Product Safety Act ("CPSA") in relation to certain portable generators that were subject to a voluntary recall previously announced on July 29, 2021 - $5.8 million in the first quarter of 2023.
        
(6) Represents non-cash (gains)/losses from changes in the fair value of the Company's investment in Wallbox N.V. warrants and equity securities.
        
(7) Represents fees paid to creditors and the write-off of the unamortized original issue discount and deferred financing costs in connection with the refinancing of the Company's Tranche B Term Loan Facility. 
        
Net income to Adjusted net income reconciliation       
 Three Months Ended September 30, Nine Months Ended September 30,
 2024 2023 2024 2023
        
Net income attributable to Generac Holdings Inc.$113,742  $60,377  $199,089  $118,005 
Net income attributable to noncontrolling interests 36   257   220   2,305 
Net income 113,778   60,634   199,309   120,310 
Amortization of intangible assets 24,157   26,718   73,698   78,934 
Amortization of capitalized debt fees and original issue discount 644   981   2,592   2,902 
Transaction costs and other purchase accounting adjustments (8) 747   356   2,272   1,743 
Loss/(gain) attributable to business or asset dispositions (9) -   -   65   (119)
Business optimization and other charges (4) 1,564   5,291   3,190   8,151 
Provision for legal, regulatory, and clean energy product charges (5) 2,382   22,113   5,280   27,913 
Change in fair value of investment (6) (5,198)  -   2,938   - 
Loss on extinguishment of debt (7) 4,861   -   4,861   - 
Tax effect of add backs (7,317)  (13,887)  (23,762)  (28,476)
Adjusted net income 135,618   102,206   270,443   211,358 
Adjusted net income attributable to noncontrolling interests 36   257   220   2,305 
Adjusted net income attributable to Generac Holdings Inc.$135,582  $101,949  $270,223  $209,053 
        
Adjusted net income attributable to Generac Holdings Inc. per common share - diluted:$2.25  $1.64   4.47  $3.35 
Weighted average common shares outstanding - diluted: 60,312,393   62,091,163   60,475,478   62,362,743 
        
(8) Represents transaction costs incurred directly in connection with any investment, as defined in our credit agreement, equity issuance or debt issuance or refinancing, and certain purchase accounting and contingent consideration adjustments.
        
(9) Represents (gains)/losses attributable to the disposition of a business or assets occurring in other than ordinary course, as defined in our credit agreement.
        
        
Free Cash Flow Reconciliation       
 Three Months Ended September 30, Nine Months Ended September 30,
 2024 2023 2024 2023
        
Net cash provided by operating activities 212,285   140,136   401,847   204,724 
Proceeds from beneficial interests in securitization transactions -   1,061   -   2,533 
Expenditures for property and equipment (28,627)  (23,818)  (83,399)  (77,718)
Free cash flow$183,658  $117,379  $318,448  $129,539 

FAQ

What was Generac's (GNRC) revenue growth in Q3 2024?

Generac's revenue grew 10% year-over-year to $1.17 billion in Q3 2024.

How much did Generac's (GNRC) residential product sales increase in Q3 2024?

Generac's residential product sales increased 28% to $723 million compared to $565 million in Q3 2023.

What is Generac's (GNRC) updated sales growth guidance for 2024?

Generac updated its full-year 2024 net sales growth guidance to 5-9%, increased from the previous guidance of 4-8%.

How much stock did Generac (GNRC) repurchase in Q3 2024?

Generac repurchased 690,711 shares for approximately $102 million in Q3 2024, with $347 million remaining under the current repurchase program.

GENERAC HOLDINGS INC

NYSE:GNRC

GNRC Rankings

GNRC Latest News

GNRC Stock Data

11.00B
58.47M
1.71%
89.72%
4.03%
Specialty Industrial Machinery
Motors & Generators
Link
United States of America
WAUKESHA