Blue Bird (BLBD) Looking to Continue Growth After Acquisition

Stephen L Kanaval  |

The school bus designer and manufacturer Blue Bird Corporation (BLBD) earlier this month finalized the acquisition by American Securities LLC from the Traxis Group B.V., an affiliate of Cerberus Capital Management, L.P., which represents a total of 12 million shares or 57% of common stock.

This whirlwind buyout did not really get much attention, but the players involved are leading investment institutions. American Securities has $15 billion under management across North America. “We are extremely pleased to partner with Phil Horlock and the Blue Bird management team,” said Kevin Penn, a Managing Director of American Securities, in a press release given at the time. “We have admired Blue Bird’s focus on operational execution, growth and profitability for some time and we think the company is well-situated to build upon its current market position. Blue Bird is a company with an iconic brand and quality workforce that is truly a leader in the school bus business. We believe it is a great long-term investment and are excited about the next chapter of growth together.”

As education rises, many analysts have watched BLBD’s stock closely. In the most recent earnings report, it was important to note that propane bus sales were up 20% and net sales were up 4%. "We delivered top-line growth of 4% in the second quarter which helped drive Adjusted EBITDA of $10.1 million for the period,” said Phil Horlock, President and Chief Executive Officer of Blue Bird Corporation in the company's earnings call. “Momentum behind our propane-powered bus offering continues with sales up 20% over prior year in the quarter. We are continuing to innovate with exciting new products that customers want and value. Orders for our new gasoline-powered Vision school bus have been coming in at a strong pace, and we will start shipping buses with this powertrain in our fiscal fourth quarter. This new product, and others like it, will continue to differentiate Blue Bird and drive future growth. Our second shift in manufacturing is ramping up on schedule to support a stronger second half of the year. Based on our financial results to date, the backlog of bus orders currently in-hand, and our outlook for the balance of the year, we are reaffirming our previous full-year guidance for net sales, Adjusted EBITDA and free cash flow.” Blue Bird is also exploring working its way into overseas markets per analysts’ reports.

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Companies

Symbol Name Price Change % Volume
BLBD Blue Bird Corporation 19.93 -0.15 -0.75 99,254 Trade

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