blbd-20230701

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 1, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ................................ to ...............................................

Commission File Number 001-36267

BLUE BIRD CORPORATION

(Exact name of registrant as specified in its charter)

Delaware 46-3891989

(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

3920 Arkwright Road, 2nd Floor, Macon, Georgia 31210

(Address of principal executive offices and zip code)

(478) 822-2801

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common stock, $0.0001 par value

BLBD

NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated Filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

At August 4, 2023, 32,146,329 shares of the registrant’s common stock, $0.0001 par value, were outstanding.

BLUE BIRD CORPORATION

FORM 10-Q

TABLE OF CONTENTS



PART I – FINANCIAL INFORMATION			2
Item 1. Financial Statements (Unaudited)			2
Condensed Consolidated Balance Sheets			2
Condensed Consolidated Statements of Operations			3
Condensed Consolidated Statements of Comprehensive Income (Loss)			4
Condensed Consolidated Statements of Cash Flows			5
Condensed Consolidated Statements of Stockholders' Equity			6
Notes to Condensed Consolidated Financial Statements			8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.			18
Item 3. Quantitative and Qualitative Disclosures About Market Risk.			35
Item 4. Controls and Procedures.			35
PART II – OTHER INFORMATION			36
Item 1. Legal Proceedings.			36
Item 1A. Risk Factors.			36

Item 5. Other Information.			36
Item 6. Exhibits.			37
SIGNATURES			38

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in thousands of dollars, except for share data)	July 1, 2023		October 1, 2022
Assets
Current assets
Cash and cash equivalents	$	50,497	$	10,479
Accounts receivable, net	11,429		12,534
Inventories	129,169		142,977
Other current assets	9,614		8,486
Total current assets	$	200,709	$	174,476
Restricted cash	$	238	$	—
Property, plant and equipment, net	96,091		100,608
Goodwill	18,825		18,825
Intangible assets, net	45,926		47,433
Equity investment in affiliate	14,826		10,659
Deferred tax assets	10,385		10,907
Finance lease right-of-use assets	1,209		1,736
Other assets	1,802		1,482
Total assets	$	390,011	$	366,126
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable	$	136,185	$	107,937
Warranty	6,593		6,685
Accrued expenses	28,499		16,386
Deferred warranty income	7,769		7,205
Finance lease obligations	580		566
Other current liabilities	18,263		6,195
Current portion of long-term debt	19,800		19,800
Total current liabilities	$	217,689	$	164,774
Long-term liabilities
Revolving credit facility	$	—	$	20,000
Long-term debt	115,149		130,390
Warranty	8,784		9,285
Deferred warranty income	13,866		11,590
Deferred tax liabilities	215		—
Finance lease obligations	1,135		1,574
Other liabilities	8,181		11,107
Pension	14,548		16,024
Total long-term liabilities	$	161,878	$	199,970
Guarantees, commitments and contingencies (Note 6)
Stockholders' equity
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 0 shares outstanding at July 1, 2023 and October 1, 2022	$	—	$	—
Common stock, $0.0001 par value, 100,000,000 shares authorized, 32,121,607 and 32,024,911 shares outstanding at July 1, 2023 and October 1, 2022, respectively	3		3
Additional paid-in capital	176,290		173,103
Accumulated deficit	(74,318)		(79,512)
Accumulated other comprehensive loss	(41,249)		(41,930)
Treasury stock, at cost, 1,782,568 shares at July 1, 2023 and October 1, 2022	(50,282)		(50,282)
Total stockholders' equity	$	10,444	$	1,382
Total liabilities and stockholders' equity	$	390,011	$	366,126

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended				Nine Months Ended
(in thousands of dollars except for share data)	July 1, 2023		July 2, 2022		July 1, 2023		July 2, 2022
Net sales	$	294,284	$	206,083	$	829,830	$	542,965
Cost of goods sold	248,534		184,490		740,974		502,018
Gross profit	$	45,750	$	21,593	$	88,856	$	40,947
Operating expenses
Selling, general and administrative expenses	26,328		20,505		66,365		58,596
Operating profit (loss)	$	19,422	$	1,088	$	22,491	$	(17,649)
Interest expense	(4,507)		(3,908)		(13,895)		(9,481)
Interest income	246		—		258		—
Other (expense) income, net	(6,421)		735		(6,999)		2,215
Loss on debt modification	—		—		(537)		(561)
Income (loss) before income taxes	$	8,740	$	(2,085)	$	1,318	$	(25,476)
Income tax (expense) benefit	(1,884)		(2,860)		(292)		6,317
Equity in net income (loss) of non-consolidated affiliate	2,502		(1,490)		4,168		(3,505)
Net income (loss)	$	9,358	$	(6,435)	$	5,194	$	(22,664)

Earnings (loss) per share:
Basic weighted average shares outstanding	32,073,497		31,990,860		32,044,581		30,687,406
Diluted weighted average shares outstanding	32,598,938		31,990,860		32,335,381		30,687,406
Basic earnings (loss) per share	$	0.29	$	(0.20)	$	0.16	$	(0.74)
Diluted earnings (loss) per share	$	0.29	$	(0.20)	$	0.16	$	(0.74)

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)


	Three Months Ended				Nine Months Ended
(in thousands of dollars)	July 1, 2023		July 2, 2022		July 1, 2023		July 2, 2022
Net income (loss)	$	9,358	$	(6,435)	$	5,194	$	(22,664)
Other comprehensive income, net of tax:
Net change in defined benefit pension plan	227		221		681		663

Total other comprehensive income	$	227	$	221	$	681	$	663
Comprehensive income (loss)	$	9,585	$	(6,214)	$	5,875	$	(22,001)

The accompanying notes are an integral part of these condensed consolidated financial statements.

BLUE BIRD CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Nine Months Ended
(in thousands of dollars)	July 1, 2023		July 2, 2022
Cash flows from operating activities
Net income (loss)	$	5,194	$	(22,664)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization expense	12,077		10,089
Non-cash interest expense	1,124		3,084
Share-based compensation expense	2,229		3,153
Equity in net (income) loss of non-consolidated affiliate	(4,168)		3,505
Loss on disposal of fixed assets	13		12

Impairment of fixed assets	—		1,354
Deferred income tax expense (benefit)	522		(6,293)
Amortization of deferred actuarial pension losses	896		872
Loss on debt modification	537		561
Changes in assets and liabilities:
Accounts receivable	1,105		(3,037)
Inventories	13,808		(91,519)
Other assets	(228)		80
Accounts payable	27,953		56,280
Accrued expenses, pension and other liabilities	23,069		(9,928)

Total adjustments	$	78,937	$	(31,787)
Total cash provided by (used in) operating activities	$	84,131	$	(54,451)
Cash flows from investing activities
Cash paid for fixed assets	$	(6,390)	$	(4,748)

Total cash used in investing activities	$	(6,390)	$	(4,748)
Cash flows from financing activities
Revolving credit facility borrowings	$	45,000