Blue Bird Corp (NASDAQ:BLBD) Q2 2022 Earnings Conference Call May 12, 2022 4:30 PM ET

Company Participants

Mark Benfield - Executive Director, Profitability & IR

Matthew Stevenson - President, CEO & Director

Razvan Radulescu - CFO, Principal Financial & Principal Accounting Officer

Conference Call Participants

Eric Stine - Craig-Hallum

Operator

Hello, and welcome to the Blue Bird Corporation Fiscal 2022 Second Quarter Earnings Conference Call. [Operator Instructions].

Please note, today's event is being recorded. I would now like to turn the conference over to Mark Benfield, Head of Investor Relations. Sir, please go ahead.

Mark Benfield

Thank you. Welcome to Blue Bird's Fiscal 2022 Second Quarter Earnings Conference Call. The audio for our call is webcast live on blue-bird.com under the Investor Relations tab. You can access the supporting slides on our website by clicking on the presentations box on the IR landing page.

Our comments today include forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters we have noted on the following 2 slides and in our filings with the SEC. Blue Bird disclaims any obligation to update the information in this call.

This afternoon, you will hear from Blue Bird's President and CEO, Matthew Stevenson; and CFO, Razvan Radulescu. Then we will take some questions. So let's get started. Matt?

Matthew Stevenson

Thank you, Mark, and good afternoon, everyone. The second quarter of our fiscal year 2022 began on a positive note with an improving supply chain environment and softening futures on commodities. But these early gains were disrupted by world events in the Ukraine and in China, which led to considerable disruptions in our supply base and higher material cost inflation. Overall, it continues to be a challenging environment, but team is still making considerable improvements in our operations as well as our strategic initiatives to drive the company forward. The overall fundamentals of our customer base remains strong and the new grant funding mechanism for clean and cleaner emission school buses are creating a very exciting future for us.

On Slide 6, you can see though that demand remains high for our products. Our order intake for Q2 was up 30% year-over-year, supporting a record backlog of approximately 6,600 units worth over $700 million. Given supply chain is limiting our production, we price protected units we built and delivered in Q2 in order to safeguard our dealer and customer relationships. Many of these buses were priced and ordered prior to June of 2021. We continue to make improvements in our underlying operations to prepare for higher throughput when supply chain disruptions ease and look forward to reaping the benefits of these improvements in the future. We are hopeful in the quarter, we would see improvements in the supply base, but numerous shortages and delays in critical parts impacted production.