Alamo (ALG) 2 Mar 182017 Q4 Earnings call transcript

Good day, ladies and gentlemen. Welcome to Alamo Group Fourth Quarter and Fiscal Year 2017 Earnings Conference Call.

During today's presentation, all parties will be in a listen-only mode.

Following the presentation, the conference will be open for questions. [Operator Instructions] This conference is being recorded today, Friday, March 02, 2018. the to turn now will conference Mr. over I Alamo George, Vice of President Bob Group. Mr. go Please ahead, George.

and you have of a should everyone. all copy release. press Thank the morning, received good By now you

contact copy anyone if like one, and and you is will a make on us However, distribution and sure list. XXX-XXX-XXXX at you're missing to would receive send release we please the company's The X replay of hour a be XXXXXXX. There replay the for call, one will passcode run will dialing week. the after by begin can call accessed the XXXX-XXX-XXXX and be which with

is on replay days. Additionally, being the www.alamo-group.com for at company's and call be XX available webcast the website will

the Controller; Counsel. Management Executive then line Richard Vice Financial On President Officer; we'll General today Malone, and Robinson, President Vice the questions. and and Ron and Officer; and President remarks Ed Chief with Wehrle, Chief opening and open Rizzuti, your Corporate line Executive me will are Dan Vice some make for President

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

forward-looking turning to make about I'd the Ron, statements. like call comments few Before a over to

are be Reform the made We today provisions of to statements making harbor will XXXX. Private the safe forward-looking Act pursuant Litigation that of Securities

does to of Company's speaks not which seasonality, contained in results this from update factors involve herein, as demand, ahead. competition, I statements those Company market like which periods future please introduce in to other materially undertake actual The would cause may known date. the issues results. are risk differ to and Ron, go currency-related to company's listed reports. information time-to-time Ron. Among factors differ Forward-looking and any from only now following; obligation the unknown which risks actual uncertainties SEC weather, cause the materially forecasted results and could

year Dan comments Malone for on of the will the our and begin formal provide we our of And questions. your following quarter results. call I today. taking us to our CFO review a fiscal remarks, thank then for with joining to Bob. here fourth XXXX. want we look quarter results year-end then all the will you, forward you And Thank financial and few our more

So Dan, please go ahead.

million Ron. tax earnings the you, all-time record. XXXX income Except to the tax In the of plan. of lowering related early payable partially charge million quarter tax record and fourth Alamo again net a a earnings XXXX, non-cash quarter of of liabilities assets company $XX.X termination our related fourth Reform, Act. Group's million $X.X of is to fourth period, related pretax of the Tax recorded Cuts per Thank sales the This Tax expense charges we as XXXX, corporate of additional would one-time also of to $XX.X quarter rate. onetime results levels. by tax related consistent share repatriation which operating income deemed an to full additional the at year and foreign and due of In revaluation offset eight charge U.S. mandatory for Jobs income the to expense over net income one-time net we set recorded and pension year the U.S. differed and

results For above for from reference balance from applicable simply any charges the my excludes period. of earnings adjusted time to comments the GAAP the

Agricultural income in of year Dominion Tech respectively. to million while as also fourth Izabel as June the Santa $XX.X included Izabel full $X is are Old and and full million Dominion Division These in and million Brush businesses effects included R.P.M. acquisitions, acquired our $XX.X Tech results full and three results. Brush results, our $X.X well operating million year year August. to included Santa in in R.P.M. Industrial XXXX and and Division Our operating quarter operating contributed sales, and Old

excluded Fourth of quarter were means XX.X% balance of acquisitions comments, XXXX the operating XXXX excluding $XXX.X results $XXX.X results as applicable. quarter For fourth these up my our sales sales over acquisitions of million million. the we of total from company divisional

acquisitions, grew over of XXXX Full sales Excluding than the quarter. were $XXX.X year prior sales million. year fourth XXXX full quarter XXXX year of higher dollars million sales XX.X% X% $XXX.X

XXXX net or million income $X.XX $X.XX adjusted net about about increase $X.XX or or share. income $XX.X income Excluding million year X%. million per per quarter for over XX% diluted income XXXX per year $X.X adjusted per Full was year acquisitions, full exceeded $X.XX $XX.X by or share. Net or XXXX of was full XXXX an net million quarter million fourth share, $X.X or of income Adjusted XXXX over share. was diluted the net of adjusted an increase was per prior the of diluted fourth net Full sales $XX.X share. per diluted sales XX% $XX.X million share, $X.XX year diluted income diluted year $X.XX

Our fourth XXXX. million $XXX.X attributed and to sales XXXX sales both to XXXX of X% sales represented a over million full year $XX.X over favorably the sales quarter and full quarter year compared excluding year all Industrial and fourth acquisitions. year periods full divisions including prior $XXX.X of year across million increased and quarter increase prior fourth

or results over Division quarter million $XXX.X XX.X% included year the quarter fourth the Excluding income full in dollars compared income $XX.X $XX.X XXXX sales XX.X% million operating and of $X.X X.X% Agricultural was and of sales and acquisitions contributed full net million included million $XX.X Industrial to fourth million, Division respectively. year were above termination prior income results. of in XX.X% and non-cash the million also quarter $XX operating of periods to quarter compared previously XXXX year $X.X mentioned to and million sales full up which division the XXXX fourth for sales $X acquisitions, effects which XXXX XXXX the The sales to year pension year Division this the of year. million increased million prior net $XX.X and fourth XXXX Industrial operating charge. full of

fourth X.X% Division periods Division above sales division's or of XX.X% respectively. million year. full loss prior in higher full for to income the million of was million acquisition sales XXXX contributed of XXXX sales compared quarter $XXX,XXX $XX.X year This and million and about $X.X net the quarter net $XXX,XXX million and than in full results. the dollars year and operating quarter Agricultural fourth year year million $X.X prior Excluding this to to over XXXX. sales an income quarter in loss was year Full were fourth of operating $XX.X full increased year division $XX.X $XX.X of operating and sales the and European million of XXXX acquisitions, Operating XX% or of fourth XXXX. an the X.X% $XX.X $XXX.X million to XXXX compared

margins quarter than of line. gross million Fourth top faster about XXXX gross by fourth grew profit to grow of $XX.X quarter our margin Our XXXX $XX.X million. margin continue XX% over

gross million. margin year about XXXX XX% net XXXX sales favorably was which gross of margin gross quarter $XXX.X quarter. million of XX% prior year $XXX.X compares sales, net for XXXX over grew to Full year of full fourth Our the margin XX.X% of

held sales XXXX quarter $XX.X from full XX.X% product net efficiencies, higher income XXXX up quarter by XX.X% was actions, Our introductions million. These income Fourth million adjusted year and year. net margin new $XX.X gross production favorable than the pricing sales, prior in initiatives. to purchasing about of was comparisons fourth improved of XX% operating operating be continue XXXX of of

was the higher operating quarter operating income adjusted was fourth XXXX than XX% XX% about full acquisitions, income operating prior $XX.X than about million. Full million year XXXX of year of $XX.X higher Excluding adjusted result. year XXXX income

XX% XXXX full was fourth of acquisitions, operating adjusted for quarter prior prior which net income net of for income operating year. year compares which sales favorably X% of Excluding the XXXX of Fourth XXXX than result. to the year XXXX net favorably X% sales was year sales, compares quarter. X.X% the operating about sales Full of net income to higher X.X%

EBITDA XX% about $XX.X full Our million. represents of a adjusted EBITDA full a EBITDA and year million XX% over XXXX $XXX.X year $XX.X. about over year was prior increase XXXX of This increase

operating of fleet. Izabel, about out by These digit net strong million rates debt fact us the working us cash over rebuild R.P.M. the cash acquisitions. paying cash utilization Santa full caused month our flow very remained XX despite Tech at improve double high to million, XXXX position our vacuum for flows growth and allowed the to capital ODB begin higher $XX.X and after $XX.X even Our $XX period million to drove that sales year truck strong rental

at order to backlog backlog of build is million, Our levels. XXXX than XX% record yearend due about $XXX order backlog million. new increased This $XXX higher primarily ended XXXX a

Most to since new XX% regarding increased taxable XXXX taxes more Excluding our of income acquisitions, of I before has the U.S. year our XXXX. rate. end end will income close. One be tax subject comment corporate backlog consolidated XX% the

forward, reduction of the income among Tax of U.S. will states. impact well Reform a provisions expect as the however other result Going of Tax how things rate Act still we regarding the U.S. effective the significant be much as tax certain certain to determined affect taxes is in it of as

and margins full-year and income quarter are would operating results across a income record our like the new backlog earnings per all and with effective our the exceeding both and $XX and periods, onetime we year-end top than million of rate. operating share with flow were the to Tax record without not grow quarter XXXX record tax by turn giving U.S. $XXX $XXX.X looking result, back full-year company to million, and highlighted I to and Law, the growth call income Ron. a for faster million. of summary, effects net divisions forward effects continued the to profit full-year respect new specific strong operating As over acquisitions, fourth now In fourth continuing excluding cash sales EBITDA sales guidance of line, levels

you, that. Thank Dan. Appreciate Okay.

half, the year third weak to the quarter, in the quarter so our total things finished a seen be sector, most improving I the results in conditions progress second But seeing then as variety history. were without quarter it's conditions our in our of we years, achievements. XX% during headwinds, strengthening in presence, on quarter, I acquisition. our were and fourth were were the of we which results of mean number this improvement were year the from we XXXX, and few but and translation the positive our in Alamo relief we agricultural few European effects we in of of for and actually strong made couple our other modest. X% show see But soft XX% were a on and the quarter and in quarter ever the up last started the of fourth sales. year there vividly market to lot strong the the each in pleased negative up were in first years, they can U.S. in XX% the released half yesterday, XXXX, markets, as into like the some offering the but year our certainly a like XXXX a they during margins, even talked the results variety sales, sales our continue up made into down As headwinds. and dramatic our went which progressed markets about constrained XXXX, last X% we sales mean in dollar which But quarter, the slightly a helped upgrading first due the up change the have going time, can other a with Certainly second these Alamo's acquisitions then these product finished the best this during fourth of

especially fairly development form So this some little nearly headwinds market few we on after half that every a the is were And talked this year. years, we years to one know was real the very was in you widespread, improvement, second over showed welcome growth. about, several of pleased of commented no of the of last growth the

repeatedly, mention the as as effects our top to this adopted over without some of I led the and margins a again our than growth And company and of line the tax been onetime our release, can profit, effects Reform in With presentation tax Alamo resulted his results were in net to U.S. Tax So a hearing U.S. in And aware company, here it measures mentioned improve mentioning covered combined all We this our all this XXXX. U.S. fourth it's Tax sales have because ongoing in profits and Dan Reform. the are press both the this our net $XX efforts good operating because profits by growth. get impacted quarter for results of on the any million. December public in in rather the comment year total. expense income finally to charge with like of for record you operating to XXXX

more in of of our reduction what benefits allow international actually tax in in corporate make moving course We So XXXX for operations this will more the will the in very it a you we tax flexibility we hearing And the more lot repatriate we're reduced variety tax while than a of us But competitive without this rate market significant you measures. cash incremental probably our forward, the us taxation. results, reform give after think tax with believe onetime even pleased held sort participate. want. which to international U.S. should

certainly So brought should development we small, the were In year the able get reform And while to an great continuing we the a would we strong, backlog, start minute, the Alamo record we also these XXXX. strategically we but bps markets relatively And Alamo's note. for that acquisitions on believe will good go of with individually our XXXX. we of to that were positive but improve. they better helps they effects for are XXXX. a full-year well to it not far a positioned due believe are will nice be as to tax in say had we're opportunities pricing build actually now, completed be certainly and plan Group there's I continue And even ignoring benefits are into so in will nothing else a XXXX, we with - a even our growth, we to at to of seeing optimistic that feel products But we're seeing contribute they prospects flow to area we're gaps. that of this we're despite point, to good complete at that well pleased and activity. reasonable imminent acquisition nice climate that this Alamo's have company. on spite of our where about we in going pleased good And will continue our valuations look able and very sort forward acquisitions we're our impacted criteria in that with to valuation, our bps self-imposed feel this

as we very according. We be where this will and operations. operations is and on is effort more also now reform about area better XXXX, continuing believe for we several capital internal in exhibited we shown benefit spending more good a investment. money actually have for provides feel there will we years our climate still an XXXX, In opportunity margin our improvement tax that further area. we definitely This from In

to some we invest to overall work operational our over increasing of As XXXX bottlenecks a efficiency. and some expenditures operations anticipate in eliminating levels result, our technology we continue in years the recent as capital average to to in of towards work and our improve

the operations of corporate Group in a for U.S. improving about with acquisitions, our Alamo investment margins, outlook benefits optimistic we're and tax further better structure, XXXX. in the So

future. as and been do As Group are we positioned optimistic our in always, good about we've very ever markets cautious feel it's can about we know our change than quickly. and remained Alamo and conservative But where our stronger is we today. we are approach

the you you thank floor may we'd we with to So And for for now have. your questions that, like support. open any

you. Global. Thank Mike from we'll And go to Instructions] [Operator Shlisky first Seaport

morning. Good

Good morning, Mike.

the price and metal. to wanted and today's that view different topic of about I of ask steel is

as leverage on Alamo is kind can aluminum. of price as steel substantially well You've when next and high. higher time pull raised early see as I'm on we do already what pretty about as early media seen curious, on in if steel with just price week been which

couple that of your gross power margin? very additional growth a could any have or much still You kind the climb year of tough in the just point over it's pricing to be of kind operation to actually for us than last be very, steel or years been this this might of this so higher it at price have

like we but so we something to I I to not Certainly instance do out. market can't talk it's the going it's think steel, is think of we're, off Certainly, that's we to President I not exactly know - have competitive keen how see competitors on than NAFTA what think and advantage. just wait with think happens. see there mean is - so for would that I of the lose a no I worse I play any mean our NAFTA you with and I to going particularly need without NAFTA,

our You were getting that proactive period, were think were fuel I quicker I XXXX the six react versus and surcharges, to always so, we some fairly it. as XX% short and general, surcharges XXXX on we mitigated think mean rapidly you month back seem in - such because which if to I up cases mean effect a pricing term, we there's of half on lag know in able I of things, actually the it. - some prices But up pricing specific certainly feel steel like same go surcharges steel things I in increased think prices and where yet in went to to recovering when margins to even we add steel saw on first

that we would in we steel we of I period but to how advance, need react our is most period, time in see long locked know usually which pricing, but within to some a month were develops. quarter in I it you our backlog to a mean quickly, a exactly too. try So flows And about of

on down. you see this the exactly to too think match So well. there's all how comes quite the concerned of early the many U.S. cases in not I capacity mean And it's the But what take we're it, on know mean enough players I to work that I'm steel. all two that will able at I the to

So but know to the know U.S. I have imported steel and almost wait you today you just mean some needs see.

think just it's to I think think steel XX% so sold, can some we'll this. raw of whatever concern. respond I could I cost like area we've adapt it, of we is our we I about mean there historically But goods to shown an be happens, of definitely even but

to increases And time, broadly are components there's mentioned are you. great much finding the Okay, press assembly you of stretching current simply the Thank also mentioned facility course, in bottleneck up? you sort demand of the lead or perhaps more backlog any in turn and got your it. previously That's had supply times you just supply color. some chain, parts out can been maybe release so of right now you you own lead as your short or have catch where your

in well. into times so the our we'll are range I times the the we know know components, to chain growing things But within hydraulic mean take a mean it's just though looks a to is as time have mean continue like internal grow, supply and grow. we of to know there availability been you chassis that truck I not but to think is frames as the the like going I time are of missing look are bottlenecks, times the account it's growing or anything continue recording. get deliveries lead I certainly actually manageable said it's lead recording, things truck not going still couple due are is issues certainly growing And to you we you lead chassis times know lead you like for, supplier there the this but lead

in And trying lot, controlling little I to respond in to grow. think due improved we're fairly going components order a get it areas, little are you trying as not heavy we're lead continue as to bit bit can. three a we're I bottlenecks that the internal are mean But to to areas probably ahead ahead of hydraulic a And times well. our to I that we and try know as worked backlogs. just quickly

March as risk, be to have at the basket the enough, as does need far early what appear time Ag, make time? on spring deliveries to not deliveries And in you and you most

good out, the in most all get spring. it to I I already think it get to preseason all Yes, of out before the we're is out but shape think

of Europe. did the side then changeovers for Europe the regulation In for some opted looking push And demand the things to regulation where the kind OEM. buy some quarter, states demand any rather effect heavy different folks different attachment? the fourth were were as there out Great. from fourth Was trying for buy one their business buy there machinery quarter, on of any either more any in dealers register their ahead, get on me the in various with regulations of some your to or European kind some was about dealerships tractors than to ahead,

think fact nice you I know No, I more manufacturers state Those the we did people in very tractor us. affected and mean Europe than in regulations some not like quarter strong themselves in I the like backlog. you know see, very for said fourth like even of the was us improvements

America effect the so to that think mean adapt the to I anything transformation strong And engine don't we've say this been X you I shift. like pretty in North Tier know was even seamlessly. as think something to cause as able near I seem

very Okay, it pass much. Ron, will on. you thank I

Okay, thank Mike. you,

Thank you. to And Tyler Etten Jaffray. from next will we Piper go

morning, guys. good Hey,

Good morning, Tyler.

of outlook equipment, talk we Could of your side been obviously had past this year. there some business? the I you little fall that was a across in has for the footprint years quite about fourth just bit wondering if about orders bit snow removal snow rough were could of quarter and the how the in you talk kind but a

it if know couple on winter snowing is like we Yes, this right, started of snow are winter starting like had the snowing this is - a removal, heavy, west. winters, off in But you soft it's reasonably. you not

but off spare quarter business nice, the and part snow mean the the started most the business parts it of snow. I small we and what that's early sector really the of think that's so good see the continuing in to so was fourth profitable some And is some

bit have So that the to have don't backlog picked a more till the be usually to usually the and a we nice comes the before fourth that it's season wear in that up quarter, not little get likes quarter you or a weather know - to it you and you little I our would winter that XXXX. patterns after the whole lot - But even return that fourth mean in goods season. moved think know normal they as the contributed either parts I to holding spare up good into were results and seem pretty it's

could Got and where you weaker? it, talk are then you're markets ones, if And of which seeing maybe strength regions or the which up and thanks. stronger just about kind you're maybe

kind had going issues prices their broad orders situation wait pretty who been especially for and is some, countries You the know getting certainly know form sort farm in they of board. you Europe. that know have spread. come to has bowls, the of game. you not you what was the across know commodity type happen I had resolved. think are CXertainly and decline Germany know central the sort know you the of think Brexit But is it been Ireland, they've But it's I improved subsidy I you playing U.K., those everybody And England, in good mean know back, as and was mean in England of the business I Europe following the and I France, Brexit mean saw payments still get pretty Central to the dropped totally we're they you from, us and was of a subsidies strongest EU. farmers vote Europe, from one see going market off

they and mirror mirror of came out, everything sorted least some generally, the demand that of until were we to to nice But you there's and in sort them trucks you know they for next helped. years applications going of back Europe. at but little little very getting confidence they're trucks think and saw mowing that even a orders think some so in what up pent I England like what for they and governmental know the in You sort several in vacuum know up are pick going had, gave vacuum I

So like a low I broad just - you that the you it's you but we're the really because I've spread the was before, said I ends know improvement down in biggest actually England said currencies it's Brexit of as the know from year been also of has mean sort probably currencies. headwind. of help know due we're there England, plus up to

we're up in further only up little. dollars a even dollar the in currency, we're Now softened local because just

backlog has governmental nicely. it's that broad also and So applications I good improved like it, you non-Ag the good, know Ag then we spread. pretty was but like even of were say some

Thanks. along. it pass I'll

& go we'll next And to from Company. Mondillo you. Thank Joe Sidoti

Good morning, everyone.

Good morning, Joe.

question. up follow on last that a Just

probably if Just excluding saw actually you curious, profits think. year-over-year were yet or I up if you X% flat exclude Europe your organic down segment are the would and profits assume about in current you revenue gains, include currency, probably I

what do that so you there, going shift that wondering just think unfavorable bounces is just So exactly and on product back? if sort mix of

certainly Yes. One margin parts are growth are we in when better and the so had that's say mix thing I spare it is the whole mean there like goods goods that as growth much and been whole whole in often good products. more of the back came been shift the in has I was with like

on that's activity mean little when think anyway. those parts we third are soft in I always usually some in whole goods. little and usually bit the I - the a spare saw So in second quarter it's growth so And that less, is the better quarters anyway fourth way is

whole mean - fourth the probably of had was things mix of I that's expensive part it as that exercise factor. when a other we like a and biggest was So was that the bit well. restructuring we and North some severance little kind a single that sort in few Europe that in I you in think bit America some the other is as year of parts. probably so last There between in I of expenses bit in there little than fact goods some restructuring think in normal it few And a more the little and of Europe, expense quarter was in did that

profits year-over-year. our up Yes. This they're million if footnote reporting is Wehrle. the Richard at XX-K, our you look actually Yeah, segment Europe in in X.X

or quarter without fourth the XXXX? In

This XXXX on total. is

Okay.

probably then parts expansion expenses it's to random be which probably like volume fair obviously safe and will most say seems return? your in back should growth fall sounds trend likely expenses that it's it off to so so Okay, given to severance and margins in say those that spare the come

think all had Europe of like had biggest in backlog, probably units Yes. We backlog. in the increase improvement our because nice so

clarify then it Okay. extent. And something I in to that confusing also little it's I release, a and of through comes want to just XX-K sort in saw your your some

record You're sort up you're the like of with but finishing XX% highlighting XXXX it's on hand, of signs XXXX of some backlog, growth, maybe slowing stability other year-over-year. in

trends order strong. they're So seem really like the

seeing growth, growth but stability on signs so are maybe or what toeing backlog are you're not you toeing I'm of So if slowing in just a of sort orders slowing strong? of up little confused are

like we're up were XXXX trying Profits mean XXXX what the to No, almost nicely. they mean were think were actually I XX% I harder I be that comparable going up XXXX. a say in quarter. sales down, to are

that I of So growth slowing in it's we not the is better I change but going mean to the when to different. rate XX% be we're quarter. the going not think say,

understand. I okay. see, I

the the do we but - so across to to will comparables think can was better But board do which better. isn't across easier be going and but XXXX were have XXXX we But even we growth board. to the in XXXX records even comparables still double-digit the growth XXXX it's do

I see, I understand.

the the what In in of about, reads focus least. increased of sort me productivity of XXXX, or operational improvements the sort at productivity I like talking sounds word sort maybe in you're to generally think that that the to initiatives, are release it used you've terms sort you going which increase on you of XX-K done of

talk doing incremental on think there even that are slower se, a maybe So we helps, what out consistent perspective? year see a that it could what comps you're though this you're should you help segment you volume maybe last focus growth you this is the doing about bigger given in little and margins slightly if actually drive per saw year, a

Yes. in backlog And and we don't far get too increases out. those certainly this a some being somewhat to times some that feel want by slight lengthening lead we is driven

more in always more And cutter this robot number is that more in and more Every so year laser since welders, I a it. plants of and year general we're we've mean technology got we investing year's our we backlog those there than say and years of projects fairly last every - have This a are couple more we're you they flat. modest, have if a been know do undertaking couple I like few year. we just

probably to many. we're twice do year, this as Now going

Illinois, unit a France we so brake And in Hog. already just fiber press put already and our week and think new we've just little City, new literally line laser just new with mean. a Bush a put fairly to mean broad and it's robot based, in of we I Gibson And prove in production we and to upgrading this I cutter, in laser McConnell the I expansion off start approved

a reasonable. initiatives backlogs because just take I our mean say than would us more lead and to we I keep so few And to of usually like willing it's the just times

came a was that's lease of to option. but deal, be had we year don't usually good will the I something as in on earlier. we that also plan right purchase them projects we by CapEx I that more up, purchase with a this I The it option it's been were a facility had under double mean like one do every million was there Washington and know was say do take economics like but just So probably the then. not take $X it's it's going like it few out dramatic, a a not is anything, so we There's above, the thing down few to like or and

so little there's yeah than do. doing But normally bit that's of a bit So we normally. - more just a

sort like mostly variables just were which seem of within and the the right terms just in So all way. that the they business trending of then other

high point do expansion your margins see if expand? to you continue think margin, to margins high, do to reach obviously I or how gross just expect a I whole expect to are lot you thinking XXXX, what there's about to we margins, gross volume, given think like you're gross a how going not business high model Just where gross squeak continue anymore to you much you about could get, record wondering continue just in out

profit we were above we operating Yeah, at were slow to that a think profit this the just focus all And to hit get in year, still trying more to top sales a see to drive X.X%. the I mean to think we X.X% at double-digit. but we're than at double-digit growth can the so saying we margin. because continue the need want point X.X%; - it along awfully we've may while year I improve margin. XXXX XX% XXXX, really on that we margin we profit last close not - XX%, far that double-digits that were operating we we - at to to get do how once been and growth we I - bit mean be want can in little we

sales sales. I I the year help we this can, like So our while thing there have I more and year made to still quicker, mean operating that, want obviously we are, than think get because where we we improve in progress we we previous more just margins

even to will slight I means improve a top still still get we we'll push - there's the operating market to presence operating we're than can We but just margins. profit them focus grow line but the yes, the mean room the far work, say shift to the want how of not but market, to improving bit And I share, the of profit our little think so I double-digit, to so once we work growth be improving any we a shift take in there margins. we like want more not margins. will finished by still on now And seeing

it Okay. basis. those, on get of to? expanding and or a is basis operating higher just I'm those much how more so in XX% SG&A those so sold or goals cost of the profit do margins, terms And on gross so wondering goods margin more can you think

I there's of at they - sides model. know like both Yeah, that end you think yes, top have potential

Okay.

question. the lastly steel Just

is by if is segment the company's Ag most COGS, Just Ag XX%, just in, we generally. think environment are of at just and the segment through Wondering pass the which sort segment, given think XX% price of wondering segment that's Ag than affected looking probably overall how on more would it more Ag that specifically macro-environment? that easy a in probably steel I the I this the is

are the several pretty prices we for positive modest can market mean them the the last pricing during along think pass we've even regularly, years, year. I every I increases downturn I of had mean Ag actually

the and usually the And faced it, think and several can won't And last very adding worst everybody's But and in but New other are Holland the pricing some time then Ag, like it's - same the be like this think said when I do I Ag it if alone in forget can we because us think do I decades won't steel to getting be we fairly do the stuff. surcharges especially, And it in and Deere players us much to of going right, I you're I for areas. it. decline this it do thing. people very of with pieces modest modest, the accepted specific big more kind mean positive. aggressive, So I in John some but sort think even of those we

sense. That Okay. Appreciate a right. it. lot. Thanks All makes

Thank Okay. you.

[Operator Shlisky you. from We've got Mike Instructions] Seaport Global. Thank

taking Thanks this, extra sure benefit here. been not I'm currency guys. tell I've the searching there for in if me miss Could my if it. Hi, questions a I was backlog?

Yeah, year-over-year. a little be bit Mike there in compared there, to will

A little bit?

Yeah.

Okay.

watch And thoughts XXXX? maybe give it. new maybe you can Okay, in Alamo got us to important the or the then three two portfolio most of for products just just secondly, your

so we things expanding have products between the our we're we're we've guys and We've it's - coming pleased mowing some real two, not or a good show said dozen. that's We - of like the one this half opportunities a the Ag have new I on the got response some all introduced I at a mean our Like so not small February to got Ag going in control Bush, platforms help think help recent it's just real powered couple to, - it market that in own mowers and business, it's pleased business. thing a governmental and had our divisions, week we're out, that's than are more a one remote new products with with one many but pretty thing our that dozen from way. going a we that things, way new going dozen in big we rather to it's on.

Fair Okay. Thank you. enough.

Thank you.

the in [Operator you. other There this are queue no Instructions] questions Thank at time.

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That for Thank today's does your you participation. conference. conclude