HYSTER-YALE, INC. Q1 FY2025 earnings call

• Global economic environment has become more uncertain due to tariff policies, prompting reassessment of sourcing, selling, and production strategies.
• Strategic realignment of Nuvera: Focus on lithium-ion battery modules, hybrid electric charging platform, and streamlined fuel cell development. Expected annualized cost savings of $15M-$20M starting in H2 2025, with $10M-$15M of Nuvera costs absorbed by Lift Truck business.
• Lift Truck segment faced volume challenges in Q1 but product margins solid. Americas had lower Class 4-5 truck volumes and increased costs; EMEA had operating loss due to lower production volumes.
• Bolzoni saw revenue decline from legacy products but margin improvement and cost management.
• Investments in IT systems and customer support infrastructure to enhance operational efficiency and new product introductions.

Lift Truck

• Q1 2025 revenues declined 14% year-over-year due to lower sales volumes in Americas and EMEA. Adjusted operating profit declined significantly, but product margins remained solid due to pricing actions. Americas saw lower Class 4 and 5 internal combustion engine truck volumes, while EMEA had lower Class 1 product sales. JAPIC revenues increased due to higher volumes and favorable product mix.
• Revenue contribution: U.S. domestic operations account for approximately 65% of sales.

Bolzoni

• Revenues declined primarily due to phase-out of lower margin legacy products. Gross profit margins improved due to better pricing and lower material costs. Operating expenses were below prior year, but adjusted operating profit declined due to lower volumes.

Nuvera

• Operating loss increased year-over-year and sequentially, driven by higher R&D expenses and lower U.S. Department of Defense funding in Q1 2025. Some costs were offset by headcount reduction initiatives.

• Q2 production rates expected to increase due to Q1 bookings growth. Full year 2025 revenues, production levels, and profits expected below 2024's strong results.
• Lift Truck second quarter operating profit expected to decline moderately vs Q1 due to timing of tariff costs. Bolzoni revenues forecasted to decline, but operating profit partly mitigated by cost control.
• Capital expenditures forecasted in range of $40M-$65M, below prior range, reflecting disciplined investment due to economic uncertainty.

• Tariff volatility: Shifting tariff levels impacting market demand and cost structures.
• Market uncertainty: Global economic volatility and potential tariff effects on customer orders.
• Nuvera realignment risks: Potential $15M-$18M in severance and impairment costs in Q2 with possibility of additional charges.