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Alamo Group (ALG) investor relations material
Alamo Group Q3 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Net sales for Q3 2025 rose 4.7% year-over-year to $420 million, driven by strong Industrial Equipment performance, while Vegetation Management continued to lag due to market weakness and production challenges.
Adjusted net income was $28.2 million, slightly down from $28.6 million a year ago; adjusted EBITDA was $55 million, or 13% of net sales.
Net income for Q3 2025 was $25.4 million, down from $27.4 million in Q3 2024; income from operations fell 6.3% to $37.5 million.
Backlog at September 30, 2025, was $618.3 million, down 15% from the prior year, but new orders increased 6% year-over-year.
Operating cash flow for the nine months ended September 30, 2025, was $102.4 million, representing 116% of net income.
Financial highlights
Gross profit for Q3 2025 was $101.7 million, up slightly year-over-year; gross margin declined to 24.2% due to production inefficiencies and tariffs.
SG&A expense was $59.9 million in Q3, up 5.6%, including $3.3 million in CEO transition and acquisition costs; nine-month SG&A was $171.4 million, down from $178.2 million.
Interest expense decreased to $3.9 million in Q3 and $10.8 million for the nine months, reflecting debt reduction.
Effective tax rate for the nine months was 25.3%, higher than the prior year but in line with expectations.
Adjusted EPS for Q3 2025 was $2.34, down $0.04 year-over-year; fully diluted EPS was $2.10.
Outlook and guidance
Industrial Equipment Division growth expected to moderate from double-digit to more sustainable levels.
Vegetation Management Division anticipated to see margin improvement as production efficiencies are realized over the next one to two quarters.
Q4 sales expected to decline 4-5% sequentially due to seasonality, with no immediate improvement in vegetation margins.
Long-term targets: 10%+ sales growth (including M&A), 15% adjusted operating margin, 18-20% adjusted EBITDA margin, and free cash flow at 100% of net income.
Capital expenditures for 2025 expected to be $30–35 million, funded by operating cash flows or credit facility.
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