REV Group, Inc. (NYSE: REVG) reported Q1 EPS of ($0.05), $0.07 worse than the analyst estimate of $0.02. Revenue for the quarter came in at $518.7 million versus the consensus estimate of $510.8 million.

• First quarter net loss of $14.6 million and operating loss of $11.2 million
• First quarter Adjusted EBITDA1 of $12.3 million and Adjusted Net Loss1 of $2.9 million
• First quarter net cash used in operating activities was $39.4 million compared to $72.4 million in the prior year quarter, a 45.6 percent improvement
• Total backlog increased to $1.4 billion as of January 31, 2019
• Announced a new $106 million five-year contract with the City of Chicago to provide multiple E-ONE fire apparatus including pumpers, aerials and platforms
• Company reaffirms full year expectation for net sales of $2.4 to $2.6 billion, net income of $43 to $63 million, Adjusted Net Income of $66 to $84 million, Adjusted EBITDA of $150 to $170 million, and net cash provided by operating activities of $110 to $130 million

“Results for the first quarter of fiscal 2019 came in generally as expected. As we mentioned last quarter, the beginning of fiscal year 2019 would include a reset of our operations and production cadence as a result of the many supply headwinds we faced in fiscal 2018. In addition, we experienced order growth across most of our product categories during the first quarter translating into sequentially higher backlog levels and setting us up well for the remainder of the year,” said Tim Sullivan, CEO REV Group, Inc. “As a result of our focus on net working capital management we drove stronger year-over-year cash flow results. I am proud of our team’s ability to effectively manage through several short-term issues and I believe that most of those are now behind us. We continue to expect a successful return to organic top-line growth and improved profitability in fiscal 2019 and we remain on track to meet our full year objectives.”

GUIDANCE:

REV Group, Inc. sees FY2019 revenue of $2.4-2.6 billion, versus the consensus of $2.46 billion.

Mr. Sullivan concluded, “First quarter results were in-line with our expectations for the most part and our view of end market demand and macro conditions remains consistent. Therefore, we are reaffirming our prior full year guidance and are still expecting fiscal year 2019 revenues of $2.4 to $2.6 billion, Adjusted EBITDA of $150 to $170 million, net income of $43 to $63 million, and Adjusted Net Income of $66 to $84 million.”

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