Slide 1: FY2024 Third Quarter Results Earnings Conference Call
BLUE BIRD CORPORATION (NASDAQ: BLBD) FY2024 Third Quarter Results Earnings Conference Call August 7, 2024
Slide 2: Agenda
Agenda Introductions & Mark Benfield Forward-Looking Statements Executive Director, Investor Relations Key Results and Highlights Phil Horlock CEO Financial Results Razvan Radulescu CFO Outlook Phil Horlock CEO Q&A Group This presentation includes forward-looking statements, including statements reg
Slide 3: Important Disclaimers: Forward Looking Statements
Important Disclaimers Forward Looking Statements This presentation includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations for future financial performance,
Slide 4: Important Disclaimers: Non-GAAP Financial Measures
Important Disclaimers Non-GAAP Financial Measures This presentation may include the following non-GAAP financial measures: “Adjusted EBITDA,” "Adjusted EBITDA Margin," “Adjusted Net Income,” “Adjusted Diluted Earnings per Share,” “Free Cash Flow” and “Adjusted Free Cash Flow.” Additional information
Slide 5: Key Results & Highlights
KEY RESULTS & HIGHLIGHTS Phil Horlock CEO 5
Slide 6: Key Q3 Takeaways – All-Time Record Profit for a Quarter
Key Q3 Takeaways – All-Time Record Profit for a Quarter Record Quarterly Profit; Increasing Full Year Guidance and Long-Term Outlook Robust Market Demand, Increasing Order Share and Continuing Strong Backlog Supply Chain Largely Stable; Highly Engaged with Two Key Constrained Suppliers Substantially
Slide 7: FY24 Q3 Financial Results and Key Business Highlights
FY24 Q3 Financial Results and Key Business Highlights FY24 Q3 Results QUARTERLY HIGHLIGHTS BUSINESS HIGHLIGHTS Alt. Power Sales UNITS NET Mix of 59%; Signed first collective SOLD SALES Strong 60% YTD bargaining agreement with USW ~$775M 2,151 $333M Backlog of 5.2k Units1 EV Selected for +14 vs.’23 +
Slide 8: Blue Bird Awarded $80M MESC Grant by DOE for New Plant
Blue Bird Awarded $80M MESC Grant by DOE for New Plant ▪ New 600k sq.ft. Type D / EV production facility in Fort Valley, GA ▪ Total Investment ~$160M, 50% funded by Blue Bird ▪ Build-out 2 years, launch expected end of 2026/early 2027 ▪ Raises total capacity on one shift to ~14k buses / year ▪ Provi
Slide 9: Financial Results
FINANCIAL RESULTS Razvan Radulescu CFO 9
Slide 10: FY2024 Q3 and YTD Financial Results
FY2024 Q3 and YTD Financial Results FY2024 Q3 Results FY2024 YTD Results QUARTERLY HIGHLIGHTS Q3 YTD HIGHLIGHTS UNITS NET UNITS NET SOLD SALES SOLD SALES 2,151 $333M 6,534 $997M +14 vs.’23 +$39M vs.’23 +136 vs.’23 +$167M vs.’23 Adjusted Adjusted Adjusted Adjusted EBITDA FCF EBITDA FCF $48M $(4)M $14
Slide 11: Income Statement
Income Statement ($ Millions) FY2024-Q3 FY2023-Q3 B/(W) Unit Volume 2,151 2,137 14 Backlog Units 5,218 5,199 19 Net Revenue $333.4 $294.3 $39.1 Bus Rev./Unit ($000's) $143.2 $126.5 $16.7 / 13% Gross Margin 20.8% 15.5% 5.3 ppts Adj. EBITDA1 $48.2 $29.7 $18.5 Adj. EBITDA Margin1 14.5% 10.1% 4.4 ppts A
Slide 12: FY23-Q3 to FY24-Q3 Adj. EBITDA Walk: +$19M YoY
FY23-Q3 to FY24-Q3 Adj. EBITDA Walk: +$19M YoY ($ Millions) Unit Volumes FY23-Q3 2,137 +18.5 FY24-Q3 2,151 Delta +14 (+62%) 25.0 1.2 t/o EV Volumes (2.7) 48.2 FY23-Q3 148 FY24-Q3 204 Higher Rev. (5.0) Labor and OH and Margins Delta +56 Warranty Labor Costs Freight SG&A and 29.7 Engineering Pricing,
Slide 13: Balance Sheet and Cash Flow
Balance Sheet and Cash Flow ($ Millions) FY2024-Q3 FY2023-Q3 B/(W) Cash $88.4 $50.5 $37.9 Debt $(96.1) $(134.9) $38.8 Liquidity $231.7 $134.2 $97.5 Operating Cash Flow $1.0 $39.4 $(38.4) Adj. Free Cash Flow1 $(3.5) $42.7 $(46.2) Trade Working Capital2 $(34.0) $2.0 $(36.0) Adj. Free Cash Flow decreas
Slide 14: TTM Performance Shows Sustained Profitable Growth
TTM Performance Shows Sustained Profitable Growth Rev. $303 $318 $346 $333 $1,300 $M Adj. EBITDA 1 182 ✓ Consistent Revenue in the $300M - $350M range ✓ Improved EV mix and Pricing realization maintained ✓ We beat and raised guidance for the last six quarters ✓ Record levels of 13%-15% Adj. EBITDA i
Slide 15: First CBA agreement in place with USW
First CBA agreement in place with USW Key Contract Terms Run-rate Financial Impact One-time Impacts • Three years agreement (‘24-’27) • Avg. wage +12% in Year 1 • Signing bonus $750/person Jun’24 • ~1,500 people in scope • Year 2 at +4%, Year 3 at +4% • Signing bonus in Other Expense • Enhances pay
Slide 16: FY2024 Guidance Raised to $175M and 13% EBITDA
FY2024 Guidance Raised to $175M and 13% EBITDA 1 +87 Adj. EBITDA (+100%) ($M) 175 170 - 180 FY24 Updated Scenarios Downside Guidance Upside FY24 Q4: Supply Chain Qtr. Revenue 88 $300 - $330M Units 8,600 8,800 9,000 Adj. EBITDA Revenue $M $1,300 $1,315 $1,330 $30 - $40M 10% - 12% Adj. EBITDA $M $170
Slide 17: FY2024 Guidance Raised to $175M and 13% EBITDA
FY2024 Guidance Raised to $175M and 13% EBITDA FY2023 FY2024 FY2024 B/(W) $ Millions Actuals May Aug Updated Vs. Prior Year Guidance Guidance Net Revenue $1,133 $1,275 - $1,325 $1,300 - $1,330 $167 - $197 Adj. EBITDA1 $88 $145 - $165 $170 - $180 $82 - $92 Adj. Free Cash Flow1 $121 $70 - $80 $80 - $9
Slide 18: FY2025 Preliminary Guidance and Scenarios
FY2025 Preliminary Guidance and Scenarios Tailwinds FY25 Scenarios Headwinds Downside Prel. Guidance Upside • Strong demand Supply Chain • Supply chain Units 9,000 9,250 9,500 • Stable Pricing t/o EV Units 1,000 1,150 1,300 • Labor Costs (USW) • Propane exclusive Revenue $M $1,400 $1,450 $1,500 • Ma
Slide 19: We Are Increasing Our Long Term Outlook to 15% EBITDA
We Are Increasing Our Long Term Outlook to 15% EBITDA Revenue $M Diesel Gas/Propane EV QTR Full YR 2024 Aug 2025 Outlook Outlook Rev. Units Updated Prelim. Mid Term Long Term (2027+) $M Guidance Guidance 12,000 2,500 2,304 2,254 400 12,000 11,000 3,000 2,137 2,116 2,129 2,151 10,000 2,000 10,000 8,8
Slide 20: Outlook
4 eal §=OUTLOOK i | — Phil Horlock CEO
Slide 21: 2024 Priorities Align with Our Strategy
2024 Priorities Align with Our Strategy Leader in Safety Best Great Products Service & Features Sustained Profitable Growth 8% 13% 15% EBITDA Margin Highest Competitive Quality & Cost Durability Alt Power Leader Our core strategies drive our plans towards profitable growth 21
Slide 22: Significant Federal Funding for EV School Buses
Significant Federal Funding for EV School Buses The Bipartisan Infrastructure Law of 2021 authorizes EPA to offer rebates and grants to New Program announced, utilizing Inflation replace existing school buses with clean / zero-emission models – $5B Funding over 5 years Reduction Act funding EPA CSB
Slide 23: Wrap-Up: Record Profit Outlook in FY2024 & Beyond
Wrap-Up: Record Profit Outlook in FY2024 & Beyond NA School Bus Industry Thousands Bookings 3%+ = ~8,800 units Class 6-7* 39.6 40.0 40.5 38.7 36.8 36.1 36.6 35.8 32.8 Revenue 15%+ = ~$1.3 Billion 29.6 30.5 26.4 25.7 ~7% Adj. EBITDA ~2x = ~$175 Million CAGR Adj. EBITDA 5 ppts+ = ~13% Margin EV Bookin
Slide 24: Transitioning to New CEO and Chairman
Transitioning to New CEO and Chairman ▪ Britton Smith, President, to Succeed Phil Horlock as CEO ➢ Appointment effective September 29, concurrent with start of 2025 fiscal year ➢ Smith joined Blue Bird in March 2022 as leader of EV Business; appointed President in July 2023 ➢ Smith appointed to Boar
Slide 25: Q&A
Q&A 25
Slide 26: Appendix
APPENDIX 26
Slide 27: FY23-Q3 YTD to FY24-Q3 YTD Adj. EBITDA Walk: +$94M YoY
FY23-Q3 YTD to FY24-Q3 YTD Adj. EBITDA Walk: +$94M YoY ($ Millions) +94.4 Unit Volumes (+200%) FY23-Q3 YTD 6,398 117.6 FY24-Q3 YTD 6,534 3.8 Delta +136 141.6 (13.7) Higher Rev. (13.3) t/o EV Volumes Labor and OH and Margins FY23-Q3 YTD 375 Warranty Labor Costs FY24-Q3 YTD 620 Freight Delta +245 SG&A
Slide 28: Working Capital – Dealer vs. Fleet / GSA Customer Segment
Working Capital – Dealer vs. Fleet / GSA Customer Segment Dealer Sales Flow RAW Inv. WIP Inv. FG Inv. BB Cash Transit PDI Customer (AP) Dealer Floor Plan (~2 days) Fleet / GSA Sales Flow RAW Inv. Customer WIP Inv. FG Inv. Transit PDI BB Cash (AP) (AR) 1-2 weeks 1-4 weeks 30+ days Unit sold 6 – 12+ w
Slide 29: We Are Increasing Our Long Term Outlook to 15% EBITDA
We Are Increasing Our Long Term Outlook to 15% EBITDA Revenue $M Diesel Gas/Propane EV 2024 Aug 2025 Outlook Outlook Rev. Units Mid Term Long Term (2027+) Updated Prelim. $M 11,317 11,646 Guidance Guidance 12,000 12,000 11,017 11,000 3,000 10,000 10,000 8,878 8,800 9,250 2,500 8,514 8,000 6,679 6,82
Slide 30: Adj. EBITDA Reconciliation
Adj. EBITDA Reconciliation 30
Slide 31: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation 31
Slide 32: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation 32
Slide 33: End
End 33