Mayville Engineering Company ( (MEC) ) has released its Q3 earnings. Here is a breakdown of the information Mayville Engineering Company presented to its investors.
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Mayville Engineering Company (MEC) is a U.S.-based, vertically-integrated manufacturing partner providing a broad array of design, prototyping, and manufacturing solutions across diverse sectors, including commercial vehicles, construction, powersports, agriculture, and military markets.
In the third quarter of 2024, Mayville Engineering Company reported a net sales decrease of 14.4% to $135.4 million. Despite the decline in sales, net income rose to $3.0 million, or $0.14 per diluted share, marking an improvement from the previous year. The company also announced the permanent closure of its Wautoma, WI facility and received a $25.5 million settlement from a former customer.
Key financial metrics showed mixed results; Adjusted EBITDA decreased by 11.2% to $17.1 million, although the margin increased by 50 basis points to 12.6%. Free cash flow slightly declined to $15.1 million, and the debt-to-adjusted EBITDA ratio stood at 1.6x. The company faced reduced customer demand, prompting cost reduction initiatives, including a 12% labor force cut, that helped maintain operating efficiency.
Management remains focused on strategic initiatives under its MBX framework, which includes cost rationalization and operational excellence. Despite the challenges, MEC is optimistic about its long-term growth, anticipating a normalization in customer orders and market demand in early 2025. The company aims to achieve $750 million to $850 million in net sales by 2026.
Looking ahead, Mayville Engineering Company plans to leverage its financial strength and operational strategies to navigate the current demand environment. The company remains committed to expanding its market share and executing its long-term financial targets, supported by ongoing cost management and strategic growth initiatives.
