The following is a summary of the Tennant Company (TNC) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Tennant Company reported net sales of $311 million for Q1 2024.

• The adjusted EBITDA for Q1 2024 was $54.9 million, marking an adjusted EBITDA margin of 17.7%.

• Q1 2024 saw a GAAP net income increase by 16.9% year over year to $28.4 million.

• In 2023, the company managed to reduce its debt significantly, ending the year with over $115 million cash.

• The adjusted EPS for Q1 2024 increased by 24.8% year over year, rising to $1.81.

• Q1 gross margin increased to 44.2%, aligned with historical data, as a result of effective price realization, cost-cutting measures, and high productivity levels.

• Tennant allocated $7.5 million in Q1 for their ERP project, with an estimated total annual spend of about $37 million.

Business Progress:

• Tennant witnessed significant growth in the Americas and plans to continue this trend through product innovations and market expansions.

• Despite the Q1 challenges in the EMEA region, Tennant anticipates stronger H2 results backed by new product launches.

• The international launch of i-mop family of products extends to Brazil, France, Portugal, and Spain.

• Tennant's X4 ROVR, the first purpose-built autonomous floor cleaning machine, has received positive feedback, encouraging the company to contemplate strategies to increase manufacturing capacity.

• Tennant acquired Austria-based distributor TCS to bolster its market position in the EMEA region, expecting it to positively impact EBITDA already in 2024.

• The ERP modernization project remains on track and within the budget, with a phased rollout scheduled for 2025.

More details: Tennant IR

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