Titan Machinery (TITN) 25 Aug 222023 Q2 Earnings call transcript

Greetings, and welcome to the Titan Machinery Second Fiscal Quarter 2023 Earnings Call. At this time all participants are in listen only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Jeff Sonneck of ICR. you. Thank

begin. may You

morning quarter gentlemen call. fiscal Good Titan welcome Machinery second XXXX ladies you. and and to Thank earnings conference

at the out should Mark second XX, the X:XX and from time. and for Chief approximately and call the David By President this to On Chairman now XXXX the Officer. Meyer, release everyone Bryan company Knutson, July Chief access Eastern Chief which quarter Kalvoda are Officer, morning ended Operating went Financial have Officer, AM Executive today earnings

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you website the to the In of by page. going ir.titanmachinery.com. may at webcast now middle the addition available providing prepared access information presentation to presentation directly settings a presentation to The is accompany the below in remarks, today's

as questions. any more current to to results the We can differ Except maybe measures, from note to that today's and subsequently assumes that make underlying call, more on of open cause that the David, by and factor conclusion ongoing financial call release to analysis or no applicable take looking guarantee them. should and forward-looking I period. updated our non-GAAP filed forward-looking in remarks. could non-GAAP greater Please in contain statements. of basis. company's made involve XX-Q. introduce statements on measures forward-looking these like inherent now obligation management presentation slide At risks two quarterly and upon I'd materially future the prepared Form based be XX-K, those facilitate call. to your minutes. a contain an comparable Titan's press that the most most ahead. therefore and financial factors comparing statements we'll and These would in section recently Meyer. identified reconciliations and Mr. adjusted risk uncertainties management Chairman financial may the projected actual financial particularly undue factors Titan's including from detailed You'll on additional required discuss reports response results discussion our do to the We'll complete XX update reliance today's see report statements be Form when in of call forward performance on annual We've Titan not remarks in approximately filed during are a any including adjusted financial With Harbor of risk included questions. remind may Safe those measures results law, your like period forward-looking to statement. statements to performance, David statements These expectations believe these placed These of of today's will directly CEO, on and not prepared measures in release. The GAAP last their that, the go everyone transparency

our update of quarter second fiscal fiscal and earnings Officer CFO of to quarter will and Operating overview second summary assumptions. today's results. Mark results Chief I'll a give you Bryan an review an modeling Jeff. you, call, XXXX business our then provide everyone. year for President our the our segments. financial the full our each call. Good to And Kalvoda, morning, Knutson, conference Thank then for Welcome XXXX On of will provide

which and momentum you overview for will see is three, second quarter we're continued demonstrates grew team's of margin earnings strong result across fiscal of performance on financial our is X.X%, This pleased second unrelenting If marks This an and of clear deliver in which quarter, pre-tax quarterly to beneficiary a and highest of are a history. a supported XX-year a demand you a segment enjoying in farm results. a second agriculture Titan the customer $X.XX, connection economy. focus quarter accomplishment. quarter At to we to was we're per million level, the segment timely into which consolidated great board with a efficiencies, XX% slide Revenue turn deliveries our great service which by strong the translated in of was the our a $XXX.X of share a inventory. seeing, was operating earnings

segment growth by pre-tax the efficiency and over robust focusing construction Likewise, construction improved service past optimized we've the strong strengths reflects that margin several demand parts years the in equipment, also our footprint. across operating been Our on driven sales rental. and segment the experienced for driving same-store notable improved

our IH While sales pre-tax revenue resilient margins international to also equipment, Ag fertilizer applicators. to our to assignment X, on million, resolve goals our Heartland us commercial product $XX.X segment completed is Ukrainian valuable and remains quarter. full drive growth and due region, to we mix, the ministry we markets the demonstrated across continues is of help be in by business our parts farmed. our farmland farm Ukraine the this service, ongoing to same-store execute customers includes August be and growth and to due acquisition access like hard application team in the Ukraine, to while to by to and the of operating up food majority support to which running to business strategy. sprayers commitment inspired Further, the our and our environment the of the our continue conflict improve we by the notable, continue in partially our as in giving of equipment Systems Through self-propelled the work keep for employees On this ability and and recognize perseverance, higher impacted to as support continues be line second adapted customer is Case

of organic commercial to us we've provides working good generate to the ability opportunities through over acquisitions, pipeline packaging continues efficiently the cycle There applicator second profitability ability past commercial turn In our the teams equipment portfolio application also establish service the we've of similar added covers exceptional to traditional increasing avenues our to quality be future a remain integration growth, distribution continue underway we and IH are farmer already with our This our improvements of through higher and over on on call demonstrate share a hard and to to additional Ag And well in levels growth assumptions We synergies Case rancher complete that value summary, team's the to and potential through customer, cultures network. as and long-term we and focused parts the provides the We customer model Our to confident and the modeling target service our of is $X. results customer in along products expansive applicator. to build look are $X.XX new I'll contributions. we Bryan made and and momentum revenue remarkably, leverage business showcase half Knutson. years a EPS the Heartland our drive accretive of the farmer to several with full dealerships. our our acquisitions. both range forward to to

and some update exceptionally largest domestic segment, and will follow supported user equipment, everyone. factor overview agricultural for strong good see even efficiencies segments. equipment technologies additional and levels and is both these domestic a primarily elevated you'll Furthermore, morning then another yields new afternoon, become is construction and an four, by segment. end To-date, Good On prices. David. increase in as and international we'll to our equipment used you, costs, of demand of with driving result start demand. color productivity, more with components, we our domestic I slide see our precision new critical input higher on our agriculture which of Thank commodity on the today's an business which agriculture key that segment, new continue times and continued

is Aged continue our used out to today's look that their and model catalyst solutions technology, higher-houred with fleet revenue parts remains late there and aged As the new growth. with current equipment to advanced for service fleets and a customers upgrade for

we average. rainfall well is As a across weather strong yield varies on potential have reminder, the with fleet industry historical depending timeliness. and still volumes and events development age experienced, footprint even above Crop our the current

than persist While dry our year. in better conditions some last of is situation moisture markets, overall the

for and those insurance have other acres that experienced customers safety USDA multi-crop plant Additionally, crop prevented or have available programs. losses, net most

markets. that While levels, primary diversity and soybeans and raised sunflowers, our we grown variable the sugar timing the potatoes barley, canola, and crops costs This conditions, seeding, crop to planting growers and the have beans, alfalfa, adapt input edible to field flexibility allows wheat, in corn growers end beets. markets, moisture of crops are

assumptions factories deliveries remain components, equipment new limiting as availability aware of are and in cash parts needed tractors, on for waiting discretion of to receive challenging some volatility tractor has in see current and by further the completing cases, high of crop horsepower for from the We and from units which quarter-to-quarter, people continues allocations better which practices. depending terms equipment most our Equipment historical the unfinished calendar-year-to-calendar of by pricing under and the availability potential move fiscal can with and unpredictable hay and will be modeling largest and Conversely, major As supply somewhat at year. we production resulting unknowns pre-sold the is a windows demand allocation segment industry units. is the confident of This new our increased is complicated in suppliers, change orders our shorter products. and capabilities we equipment supplier, which at line XXX year. equipment, feel units are

manufacturers inventory main work demand. We suppliers current our future continue with to to source meet strong the short-line and to

we on when visibility on XXXX year and modeling as discuss We call. next more we'll QX have we enter inventory calendar do XXXX assumptions, provide traditionally details will year's as earnings availability our our more we FY

see X of stated, we have that David the on Ag application space. equipment announced integration begun August the we acquisition and we future Systems Heartland are we opportunities excited for in As

North slide of see, experiencing outpaces new to supply equipment domestic an equipment. is you'll see five, demand overview Ag allocation Turning segment, lead segment. for our long times Similar to construction our and American

seeing energy and Western the are North Range Bakken We in Colorado producing our natural in related oil Front activity markets gas and fields. Dakota construction

commercial half equipment Road and construction along robust our and improvement, swing place to good moderating purchase farmers from handling. still throughout drive are and solid taking and quarter performance ability their full for across overall continue markets housing to North feedlots, peak are quarter rental projects first material for continuing for strong footprint. which American second record of also segments. in Although we utilization. construction up proud construction Furthermore, to domestic land put I'm fleet other equipment, our employees activity overall ranchers levels, for demand our infrastructure our industry seeing are very produce with and residential the and another and agriculture and outstanding a

to are six, what of grain to our higher strong Ukraine. continue year. We average farmers yields corridors harvest experiencing is are Romania which of crops. we segment, and move of equipment in as is average cash represents business growers slide with need while the into Romania is to as forward our season between also varies Bulgaria, farm back equipment customers of our and to a customers The potential season construction sales, above commodity Late countries a Germany, half Germany, limited which grain crop the Eastern Southern complete to international our has of Ukrainian with weather with their support through monetize service are overview the dry produce conditions overall. European from our an small and the development an and benefiting yields harvest looking important them the parts go for Ukrainian Ukraine. very in Like as crop prices, exports in we secure Europe we but have tight. development are countries footprint beginning busy extremely and availability within much who new global spring North fiscal On America, fall our

Europe in these of economic midst excellent allowing first in team us the QX to operational deliver half results are weather challenges. Our outstanding improvements and and and geopolitical,

But a Next, call thank the unprecedented employees job before I'd who detail. more to like I have these over sincerely supply done our review will our Mark I such to Titan to financial fantastic navigating challenges. all do, turn through chain results in

pace to produce with early worked nonetheless. Our sales, very our to customers, suppliers our keeping worked employees not team closely execute gate And impressive out equipment our who as with hard finally, like an product. Unfortunately got phenomenal I'd procurement. the to as fleet pre on thank demand, so and of well their key but

more call our financial detail. in Now, Mark? I will turn reveal to results Mark the to over

Thanks, Bryan.

for quarter revenue of to increased to eight. fiscal the million XX.X% $XXX.X XXXX. Turning slide Total second

to toward quarter margins due On in to strong conditions to Equipment planting by of strong our were nine, later and categories gross versus a year supported increasing on increased versus drove in quarter. year, margin offset XX.X% continued million closed the of and Rental in fiscal that costs variable our Heartland sales for increasing expected prior improvement us the quarter, for XXXX end million the and versus was profit our achievement revenues prior quarter given grow of equipment This from fleet revenue XX.X% to supported Our same-store which expenses Ag increased $X.X to further acquisition million annual Mark's equipment, parts business with of on increased second in shift year turn equipment. points by basis margins a and our second with XX.X% notably dollar Higher expenses anticipated the XX.X% XX $XX.X higher Jaycox expansion. partially the XX.X% the rental expansion compared million business respectively, these manufacturer years this margins. gross start the profit Growth smaller material which by inventories. in XX.X% primarily market acquisitions, by a supported the related increased and by slide in Operating Machinery margin in and to prior in and very the the $XXX which recognized mixed transaction to benefit driven this were healthy season Equipment and parts contribution were revenue Systems second year. sales prior service X.X% construction our fleet, the allowed utilization agriculture and segment to improved by driven incentives. other quarter results. be segment margins utilization associated rental not good and earlier $XX.X by year month. increased prior

the basis offset expenses period. this prior revenue than compared operating However, more to and increase percentage to reducing lead a to prior of expense XX.X% leverage to of growth points operating by was year year XX.X% revenue XXX compared as the our in

year. share period. In the when last the A $X.XX $X.X adjusted to improving to our presentation. year's nearly found an strength XX.X% expenses, in be we quarter net XXXX, per million, of $XX annual diluted remained and this $X.XX appendix discipline chart expense progress relatively compared parts and Adjusted this reflecting to the the the Given in the can to on adjusted on performance. second equated prior Floorplan interest service $XX.X year to doubled quarter flat increased continue build to million to absorption income of our rate. for of compares at slide earnings to and which compared EBITDA other last quarter million fiscal second

represents income, earnings appendix for amounts a to and see the million helped presentation. XX, year segment EBITDA margin Agriculture $XX.X slide diluted a per pre-tax pre-tax resulting XXX.X% overview GAAP adjusted nice comparable to to in fiscal sales income their most you to of million of second adjusted slide of You net the segments increased results segment quarter operating X.X%. in XXXX. our an share which the drive can of find adjusted will adjusted increasing $XXX leverage, XX.X% reconciliation income On and

quarter was aforementioned improvements the manufacturer last of the to since supported also strong made incentives. cycle, extensive the performance the recognition operations margin Beyond second we've our by

year construction company's to the compared segment. sales this period, loss to from due in XX.X% divestitures million Revenue our contributions $XX to to the decreased Turning prior recent the segment.

quarter. XXX the the year X.X%, the store is XX.X% On versus in were year representing period, quarter. the up Pre-tax margin million XX.X% a versus which prior improvement excluding same basis, stores the prior of income revenues prior year grew point to divested a the $X.X basis period, for

further Despite our business of The of improved reflects in Ukraine X.X% our income improvement as area in million as the of weakening and our this to at XX% market. well pressure, parts and team million. and tripled segment this proud as business this our service expect the margin continue flat conflict segment a a improvement focus due business. continued segment. margins, on that equipment than in was versus our an more despite $XX.X pre-tax are income represents adjusted robust this we the the pre-tax ongoing international to margin year, margin to international within to headwind focus Euro, and $X.X essentially ongoing We of in disruption currency and revenue on expansion prior our see This

slide to XX. Turning

revenue can year. first other as increased increased our month same The in revenue You six Total same the increased parts and our to XX.X%, dedicated period XXX XX.X% see period compared last and of XX.X% service compared XX.X% equipment to the months fleet sales last rental Year-to-date, to points increased utilization results. revenue X.X% improved XX.X%, basis rental six X.X%. dollar year. increased

XX. slide to Turning

Our for same the compared first year. gross the six increase $XXX.X period to a months profit was XX.X% last million,

the basis Our six fiscal first XXXX. months gross XX% points increased profit to XX of margin for

by six first $XXX to months XXXX for Our the XX.X% of fiscal million. expenses operating increased

growth of of period. first this operating compared the our six months revenue per year, year percentage leverage $X.XX increase the was XXXX in to Adjusted earnings and basis to points lead XX.X%. for increased diluted operating However, more to to as $X.XX share reducing prior XX.X% revenue compared offset fiscal the than expenses by of prior expense XXX to a

Overall, are in the to $XX XX.X% to segment our On period. the increased $XX.X for a demonstrating adjusted XX.X% our pre-tax overview sheet slide six $XXX income closing July year. fiscal cash of million August at XXXX, XX, our million. XX, margin balance end operations. adequate for Heartland Exclusive of go million highlights. acquisition, six we XXXX. XX, of in ensure the fiscal line increased the I provide acquisitions, million, of our our overview EBITDA future line be million compared at which stronger Our we of expect provide prior for an of six X% $XX.X the adjusted half cash of the did back to cash use efficiency cash into On of we our and our X month of $XX.X period seasonally end fiscal first the the we months quarter to We year. of generation would our entering of bank month in had not the in representing as as the year, the syndicate slide of We now to

new equipment, X.X the end inventory of parts Mark's end procurement quarter acquisition a year. second more higher color fiscal fiscal by effort our the increase of January inventory million, quarter of XXXX. turns result used better increase This a inventory quarter to $XXX of at a provide partially the on equipment. Machinery. availability, an increased which in inventory $XXX concerted the the increased $XX reflecting slide. of million as the inventory equipment of continue to million from million ensure $X offset little XX, first versus as in parts I at end well million a XXXX will drive of on next to from in equipment Strong level at Our X.X Parts XXXX, the $XXX second is the net $XXX of prior higher, decrease was sales to effect the million the

of million, of end million to to the quarter at $XX Our increased end rental fleet XXXX. the assets $XX fiscal compared the at second

dealership I This continues remain fleet at Ukraine line To-date, XXXX related have has as have driven Given our would increased of in last to beginning of from the we customer will our in anticipated margins over size $XX respect assets, $XX you at past be I $XX and conflict. update seeing we consistent to update fiscal and our inventories around these are for total increases of the assets our million, around since [Indiscernible] rental minutes. statement these and it quarter will the expectations country to stabilize With bottom is and healthy the Ukraine material the with down for fleet million. assets million assets the Conflict end and in a year. fiscal which business respectively. or business the had we levels and in receivables has on income damage or few few expect locations. no top the balance months, loss utilization,

setup slide of during the in shipments level equipment this performance reflected higher turns of amount second $XXX XX. and increase customers team the of to receipt and service times. high our the generated back are and slide. half of red inventory, the new were units pleased year. in bars the The these on expected are which orders quarter, very our second the includes inventory the X.X inventory blue equipment end from pre-sold quarter. reflected now a suppliers inventories percentage in of from Turning the reach size the of received to with pre-delivery sales million in awaiting used new We deliveries The of with the At

higher expect assumptions, balance XXXX shows the turn industry which Given supply of our and will the raising updated of today. we the at modeling year. levels continue chain to inventory I our operate are throughout conditions, annual ongoing we Slide challenges, XX favorable fiscal health

which we momentum continued from agriculture XX%, our growth implies the XX% second the increasing to are For half up revenue fiscal of XX%, year. to XX% segment, through our assumptions up

we As in our updated the connection a in with mid-July reminder, acquisition. our Heartland announcement of assumptions

build closed off versus please the as growth the limited can the you year performance outlook closed partial and expected was which positive XXXX XXXX acquisition year, for considered our the prior for impact Machinery Today's keep the benefiting from reflect forecast XXXX, of the acquisition, that influence However, the partial closed which in year full in half. that the second to this and which fiscal to December on of transaction Heartland acquisition, update growth April contribution year-to-date outlook. our rates Jaycox month. be contribution consider that the in incremental prevailing update is year Also, Mark's mind revenue revenue the our from

For of divestment the equipment to March a to five the revenue. to down assumption XX% is our XX% segment, stores calendar approximately accounted construction in and for of combined million and to of X% improve of increased construction current Montana, in our XXXX, XX%. North of range this assumption January revenue we our from down assumption which $XX Wyoming Dakota for Impacting

prior base, to these from growth of our Excluding XX% revenues the year assumption equates to approximately same-store sales XX%.

For are growth X%. assumption our the X% down revenue international we reiterating segment of to

that pleased remains quite for given Ukraine. are the and conflict this the within near expectation currency segment We this in ongoing our flat levels, segment headwinds

modeling an be mix $X.XX to in the revenues to Regarding Ukraine, approximately versus previously, XX% expectations disproportionate of now per share previously. share bottom lift are a and margins. revenue improve due top per an The and loss versus improvement $X.XX to we XX% earnings line down is line versus per increase share approximately in to in

of assumptions, the Given answer $X.XX at our session we our now XXXX. This are Operator, achievement question $X midpoint modeling call. are of the expected improved incentives, to to ready by new for increasing assumption annual prepared diluted per our for and a the manufacturing fiscal and $X.XX remarks. share concludes earnings range of we the the

you. question and answer we'll this Thank be session. time, [Operator conducting At a Instructions].

Inc. your proceed Stephens Please question with from Daniel Imbro question. first Our comes of with line

levers has to you what years is pull multiple David, have this do profitability. there? further for Daniel. seen of improved [ph] Reed guys, internally Hey, left margins on drive Construction to

in can the appreciate, business. is pointed this with out, Bryan, take Daniel, I it and improvements then proud as weigh continued Mark we're in Hi, here. really anything Dave construction Yes, of I'll year-over-year our missed

in through showing there fleet, our quarter. in utilization, was improving rental And fleet. that's the numbers here. you the strong of A lot mix the had contributor our initiatives at rental of we've again look think fleet I if this a

little up we our demand And again year-over-year to service, chain where side. the agriculture so, rates products. get a to Likewise, that work as another absorption segment appropriate utilizations and with continue higher And and supply a continue are. on the mentioned, and as opportunity on that'd construction driving, parts focusing opens fleet our our our bit, be with but lever lot -- and those will can if the growth levels Mark with have we increasing there absorption near utilization as we good coverage

service with so continue on drive to got that lot working and parts coming closely continue then and our great a here, out focus of with product they've business. that that side also, of them, and of to a suppliers the And initiatives just lot we've gaps side the some with products on And fill that had.

on And with of inventory good return on with and just opportunity turns And assets on the finally, equipment then that seen the side. so what you've our side the business.

numbers. of got margins construction the on to believe side. we've see more initiatives room the through one every those, the we've So driving that our on done you around And inventory also in and management higher we

and on back of Right. in expect as can the inventory inventory we normalize, And the I stabilize guess, those where forwards? the year into next supply future turns, going like starts half touching to to turns

Yes.

once three that think think supply times normal to back more of turn. about is side we've what get talked I timeframe, I a we always

think we're I comfortable times. very at three

to, get on under especially just rental You construction Ag that. international Maybe the is get you it's our inventory. some to there of within our where side, and some

say So X.XX I X.XX. to comfortably would call to it

three around targeting time. that is turn normal So what for right we're time

the on quarter. congrats Awesome,

Thank you.

you. Thank

your proceed Maria Larry with Our Blair. of De comes question with Please from William next question. line

Hi everybody. nice morning, job. Good thanks. Hey, And guys.

thing same-store First obviously, sales. strong first,

You always had challenges chain supply significant some like everybody else.

being Is challenges? driver what's getting better sales is the that dealers. -- So than other you is about it what kind or we're or curious, better it I'm like price the behind are driver chain surge big allocations same-store of just the the of supply used getting considering equipment

Yes.

is this Larry, Brian. think, I

them you a just think number there. I hit of on

do pulling you margin. the So through see in

you then So been And actually on price in the getting a a effort customer, margins an remarks, really a out gate then our certainly a to bit through in factor our early. that little it's has prepared our ability of see. and the that pass increase pre-sales, certainly close to orders by and of I bit both team of in and our getting just, early, just customers and as staying mentioned doing great with our

then staying windows with the to in is from And away. when to get available. right here their again the open needs and team pricing those and books the Our that close and order to working to with in field, then customers knowledge are close what the Fargo in teams know customers up our staying having orders those the really just procure the equipment the

As some plants different you other there's of versus the plants. know, experience shortages components pockets,

And so, capitalizing and the business opportunities. customers planning with those on our really

see turns, you it, inventory really think I sales. and the both margin, pulling higher same-store through revenue, all to So that and in

And which expressed orders allocation engine on that is a year-over-year current big shaping in the thanks. guess, we're bundle ability optimism your to outlook then year? synergy sales with that as and and opening it which Okay, how ability So the any How's the tie of kind to update maybe? to they're with up Can next maybe year. And the you next obviously discuss year-over-year? fiscal execute in obviously Heartland, successfully seeing in your I allocation the allocations, orders, relates to they're periodically. up

too Larry Yes, here good really year. assumptions our Sure. with we fiscal feel modeling this for

up as XX we of the coming as a FY windows to do at look XXXX, I our we usually FY and at have we'll order look, we as the long end gets being that feel mentioned, it here, the end so with XXXX good about months, far. So be But guidance opened of QX. be

the IH that. control C the an And just, don't we like on mentioned, allocations as can rest control with know, of as yet. for I you have year example, what QX. But we through As we

with really close works you call ton team all the can done now. our Our stay the call challenges as and I they inventory. the managing and jump and opportunities. hard through and numbers, to heard customers to And the they're be produce. to it quite anticipate credit are our lockstep and to real this team a right with year. manufacturers CNH's with I balance presale and for them mentioned, as ready us And those want able of just and what what AGCO's to getting Deere's challenge working them suppliers, just a go over on also again, through what in credit as just next want call, for It's the in have of they've again, our been to they with we we thank and see so year And next on you

can sneak quick Last I Thanks. more one question. in.

if change Germany seeing you're in concerns I rolling upwardly for Germany cetera. any guess, age rationing, shortages, this have I to relates any the and it shutdown As there the know business sentiment about and energy produce, But they onto small. don't the from energy you're day ability and et

produce So, the you've and Germany specifically, that ability just on heard? an to update

of can small Yes. we've just part also crop think see Romania, economic grain then of the Definitely and of Take this areas. the eastern Larry. Euro. Germany, And creeping devaluation southern kind southern of all the part Europe in the right got those in was Germany, good, of backdrop I challenge some you of good Ukraine, drought and as now, the of some pretty was the

So, operation I about But watch Germany, little thing serious been that -- to one some a that we've bit. think pretty improvements in making yes, we in got we've continue country. our

think of and weather the we continue positive. have late the development But to I a watch the that's to crop. season So

in going I is think this be the Germany to year. this variable biggest

and Okay. luck. Thanks good

you. Thank

with Steve question proceed from Please next of Group. Hallum Capital Craig Dyer with comes Our the question. your line

guys. morning for Ryan Nice Steve. on Good quarter.

Yes. Good morning.

mentioned quarter. I If is quarter? And the in there incremental guess then any Ag think the how second in that's half that this you manufacturer Mark, right? much assumed for I that again incentives secondly, was size I guidance? benefit heard

Hi, I Yes. Ryan. manufacturer did Yes, we did. incentives. mention the

So of the good. It year, looks our at as business if very second year. full Last in and this full our you just I it just far, the had, pertains would segment segment. so in booked we're have we earn half do on this side probable them $X.X we point, back we into for domestic and Ag this is recall year. to year year. so like for about international. the for just very did we expecting And $X.X book for Ag is $X.X we're million Ag for and booked at some to the This talking looks last We And that expect quarter. that $X.X year, the baked that the what good million the least

call the it the So would have at remaining assumed six least guidance million like months for we $X what period. in is

relative you previous to were Or assuming? that all incremental what Mark, was previously guidance? the maybe is then And

incremental. all is It

a As we year, you kind manufacturing are situation them incentives about last or hit you hit them. that as know, these cliff don't type of either you talked

degree And in putting and so, there. we not booking or high hit until them guidance there's it. we're a And them very of certainty not conservative yes, the

at incremental this we in all point to our guide. it's previous what had So

Good. Makes sense.

-- the There I for sales same-store you was pieces gave the kind moving to lot within so guidance guidance can of try you sales, the on on math, segment, the same and year sale you but what a of the is in implied side? Ag On the full Ag, construction XX% XX%. gave store the sales the have do

full for with acquisition, would we all second numbers then Heartland Yes. Adjusting big it same-store we for the acquisition. had of assume year, growth. or in to acquisition for sales those There in the obviously, are Ag we and in and XX% putting for there, the all kind provided had that acquisition year about that that, the quarter, last equate

Helpful. Last me. one for

But half getting Case do You to visibility there's much You pre-sold lot you but others be some need just visibility? mentioned you for shipped. year. equipment or the to to pre-orders? have second from much of kind IH how mentioned fulfill stuff waiting needs that's your of those getting of and OEMs configuration the this a equipment that the How

We're constant year get we you to to as one and to quarter With movement closer quarter-to-quarter as then systems here good in as potentially in I have the contact said, that. see we and different place to mentioned, with our then from as suppliers the -- that movement the another. visibility do well from have end of

be about that year, which really or as there there as feel does we of year quarters seen will movement choppier, we which their be reporting. to OEMs just an So, and those. will end receive some in again the as to will you've certainly we get be get the with there It the does good tend

Great. Thanks guys. Good luck.

Thank you.

Thank Baird. question. you. Ladies and with Mig this gentlemen, with line of comes Please the question proceed our from morning final Dobre your

guess, ask Good the to guidance like on morning. here. putting as I me well. a Thanks in for question I'd

on of And assumptions if curious with of the moving much by help you really by How incremental of driven realized maybe sort versus this of new XX%. I'm raised you raise pricing? of a is used? core this kind is months left. So, here. your pretty Because obviously this Ag kind of How us understand equipment kind can just pieces much material was six

Yes.

was don't of pricing. as much of between new the across So across much our first kind XX%, Mig, happened the assumptions. I board. But say on changed would for is The I half used, the of that's necessarily all, in quarter. I with it half kind the current think it's as about mostly and would And of back year. the that not say, half remaining it the board in of

And of as far the to to frees kind trade sale call know, we the the or on it caller as the Maybe you in, well. new that customer sell same-store comes was last the the with of as there used. get the kind there. to used As last up the as just

-- the year. at growth about we're XX% same-store XX% So now sale for about right XX

just between So, on of at this the again, fiscal timing call years, -- estimate that's the best still but uncertainty there's level as as between deliveries, some of mentioned as the quarters BJ our there's kind far point.

And is in you've educate year, as these way amount same manufacturer less recognized maybe you're incentives the a be million. X a last year little your this had equipment? me or in work. where that. assume a you how obviously since discussion higher X.X the But That's lot you that would on Isn't it you actually can that I it that expect heard more on fair obviously more at to then, helpful. bit that seems least is incentives, quarter, Thank you to be for this incentives. the And to selling

, all, -- X.X. So of last three so So yes first we year, the had

details there the would be just X it. I little some But makeup that these be into of up the we into incentives with million there. six don't yes, So the back, get reasons. can't five, get would manufacturer we are a competitive would growth We how bit. And that on the for expect and

certainly our year and And We have numbers there. now. kind in from some from it last built in growth of grow the could guidance

Okay. I'm sorry, I have two more.

and I'm we've that from not have supplier difficult, wondering, broadly pretty production is Because talked why this? choppy, that sequentially. And frankly a of just I'm ramp everything a the to highest you it it is and it your ship supplier in I your able being pretty really looking the about was that heard seeing OEMs One inventory strikes inventory guess, in at remained clear that pretty you're is them, still now. new quarter. When me equipment, equipment couple you've things years this had to struggle

in shape to seem your that else be why deliveries anybody And better much I'm of that in I've you wondering seen. terms pretty So is? than

to again, right. pleased our effort and you the Mig, have really we gotten And team. are the and like deliveries Yes, suppliers I our really, back with from said

through So at a a came year a time cases looking really to our the and in management early. got right in monitoring coming lot again, we've away here closely as orders getting had well what orders over again of customers, and And those are, just ordered inventory also of out around well early initiatives our close order some we're in gate got of and a of really up go long our as early. and a to from ordered lot the staying lot needs out and ago, team back when pre-sales ago And here. those books here,

ago. through the to in the out inventory well here book a of you come time that orders a through to takes half starting And course, them will of get customer. it the long second little year through just bit as placed uptick, modeling and and then of of see were pre-delivered sales shipments we're a to machines those that that get into So on see some that then us time is built our as on the that of the whip is come little bit those

our of those here, to so pre-sales. even can to working a control closely been supply with execute transition you one hope that continue been really for we on open tightly up yes, days, know, to as hope going But chain on and that we manufacturers. challenge starts as sheet used these can managing forward balance as certainly really and what And this period it's just suppliers and during the our

And Because managing having curious Last presumably, fiscal that as term not But order deliveries. until you're XXXX. not customers are now, am near equipment question. involving conversations business right putting providing in at XXXX I guidance. into billed really I XXXX, you're fiscal an If probably the get with they're now, people don't right. you're to Understood. as they understand how you're looking

demand right If as pipeline more up customer to demand were? how of conversations is pre-sell terms or you XXXX in you. your now? So, us you give not, fiscal XXXX are you're the calendar Thank you it shaping managing can able context equipment into pipeline? And are how that

Yes.

anticipate We do So our as business. current those anticipated as a very the our our our today stay lot work then increase said, deliveries of and close and really pricing fluid. with to been having those best we like manufacturers, team with and to you we customers conversation close price have can of price planning customers staying around the know, anticipate conversations, both

pretty here's get that fast clarify customer, using make make can so as very hey, not will in provisions we that just them we timing, We whatever idea a on good which that in price, harvest and proactively work but working for through job. area, are deliveries thing them securing do or price or them to to and with they with pay as they getting know, this best businesses, knowing at this their teams do the the it their time with is an old it now. the in doing need a planter, a a for example, common combine one working the need just delayed, then if expectations for then So, then our the as with been may planting spring has directly give directional and can what

to you when you it the on Sorry a indication and Are you interest now from able to order do it just, books? that to firm you'll that? able deliveries? sort come of press commitment of customers Or fiscal but I this firm XXXX this. for take a order Are OEM of understand is sort back a just opening to of they're decides kind and the

books timing. if price here's we will, it. release, so And can together just the can here yes, end get the get other we on as QX it with we're books to So caution they if you anticipated and get if for we you then Mig, of business so QX, together the them QX we're They go will the then know firm and and you beyond spectrum, orders them describe the will, here. of sometime take. into as order and going a starts I hey, in comes directional as be far as orders just and going QX want soon as as and as firm about to more that, and know But soon work and get we'll work you order the planning QX to

Understood.

guys. Thank Okay. you

Mig. Thanks,

turn and floor I'll our for ladies Mr. the allowed final for questions. back to concludes gentlemen, you, comments. Meyer time Thank that

your Well, on everyone forward you call. we and Machinery next in today your for progress and our look updating to call our timing to Titan on you, thank interest

great have a day. So

This you. today's concludes Thank conference.

this You your may you for participation. Thank at disconnect your time. lines