The following is a summary of the NFI Group Inc. (NFYEF) Q4 2023 Earnings Call Transcript:

Financial Performance:

• NFI Group reported a 143% sequential quarterly increase in new orders with year-over-year bus and coach deliveries up by 19%.

• Quarterly revenue was up by 15% with adjusted EBITDA rising by 642%. Gross margins rose to 11% due to a strong contribution from the aftermarket business.

• The aftermarket segment generated $551 million in revenue and $120 million of adjusted EBITDA, fuelled by higher aftermarket sales in North America.

• The company's backlog is robust at US$7.9 billion with over 10,500 equivalent units and a year-over-year increase of 22% in the average selling price for vehicles.

• NFI reported significant increases in EBITDA and cash flow, largely due to operational efficiencies within their parts distribution business.

• Total liquidity rose to $188 million, driven by improved cash flows.

• Net loss reduced by $150 million, primarily driven by higher deliveries, revenue, and adjusted EBITDA.

• For fiscal 2024, NFI Group anticipates double-digit revenue growth, triple-digit adjusted EBITDA growth, and improved free cash flow.

Business Progress:

• A significant improvement in supplier performance was observed alongside plans to expand production in 2024 using a phased approach to avoid additional costs.

• Due to changes in competitive dynamics, the company may look for improved competitive positioning in the US market.

• NFI is part of a task force created to recommend actions to support competitive and stable bus manufacturing capacity in the US.

• The company initiated the production of electric buses as a step towards zero-emission vehicles.

• Work is being undertaken to reduce the number of offline buses significantly and improve operations in their bus assembly stations.

• NFI Group's backlog remains strong at 10,586 units, expected to extend till 2028.

• The company anticipates a surge in zero-emission buses deliveries, leading to a slightly longer cash collection cycle.

• For 2024, NFI anticipates ZEBs to constitute 30% to 35% of total deliveries, with this number expected to grow to 40% in 2025.

• The company does not anticipate significant debt repayments in 2024 as they ramp up production.

More details: NFI GROUP INC IR

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