Columbus McKinnon sales increased 7% for Q1'24
Columbus McKinnon Corp., a leading designer, manufacturer, and marketer of intelligent motion solutions for material handling, reported sales of $235.5 million for its first quarter of fiscal 2024, a 7% increase. Results include the addition of montratec, which was acquired on May 31.
Other first quarter highlights include:
- Strong orders in quarter of $257.0 million with book-to-bill ratio of 1.1x
- Record backlog of $355.3 million includes $23.4 million from the acquisition
- Gross margin expanded 90 basis points sequentially to 36.8%
- Paid down $10 million in debt; net debt leverage ratio at 2.9x1; plan to pay down
- $40 million in debt in fiscal 2024
- Expect to surpass $1 billion in revenue in fiscal 2024; on track to achieve fiscal 2027 targets
“Our first quarter results further demonstrate the progress we are making with the transformation of Columbus McKinnon into a higher growth, stronger margin business," President and CEO David J. Wilson said. "Sales grew 7%, driven by strength in EMEA and APAC, and strong automation and linear motion sales in the Americas. This growth more than offset year-over-year shifts in e-commerce demand. We are encouraged by our end market activity and the progress we are making as an organization. We are focusing resources on end markets and opportunities with strong secular tailwinds such as life sciences, EVs, and industrial automation. Within this framework, we are driving to increase market share and capitalize on these favorable megatrends. Additionally, our continued efforts to simplify the business, manage costs and drive efficiencies underpin our sequential gross margin improvement.
"In our first month of ownership, the montratec acquisition contributed $2.7 million in sales," he added. "We are excited about the technology and opportunities that montratec adds to our precision conveying portfolio. We expect strong growth out of the business and look to further its potential, especially as we broaden exposure in the U.S. market. It is important to note that we successfully completed the refinancing of our debt related to the acquisition. This effort resulted in lower cost debt and eliminated the need for testing compliance with our financial covenant. Notably, with our debt reduction plans and growth for the year, we expect to reduce our net debt leverage ratio to under 2.5x1 by the end of the fiscal year.”
For the quarter, sales increased $15.2 million, or 6.9%. The acquisition contributed $2.7 million, or 1.2%, in sales. Sales outside the U.S. were driven by increased volume of $13.5 million, or 16.5%, price improvement of $1.4 million, or 1.7%, $2.6 million of sales related to the acquisition, as well as favorable foreign currency translation of $0.3M. In the U.S., price improved $7.1 million, or 5.1%, while volume decreased $9.8 million, or 7.1%.
Columbus McKinnon expects second quarter fiscal 2024 sales of approximately $250 million to $260 million at current exchange rates.
“We had a solid start to the year with 5% sequential order growth, 7% year-over-year sales growth and sequential gross margin improvement that supports our objective to expand gross margin by 50 to 100 basis points for the year," Wilson continued. "Demand for our products and solutions combined with progress we are making to improve our customers’ experience are reflected in the over $500 million of new business we have booked in the last six months. This, along with the addition of montratec, drove record backlog of $355 million, further reinforcing our expectation to exceed $1 billion in revenue in fiscal 2024. Fundamentally, we are gaining more traction with our strategy to be the global leader of intelligent motion solutions for material handling and believe our results demonstrate this progress.”
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