UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_______________________________________________________________________________________________________________________________________________________________________________________________________
FORM 10-Q
| (Mark One) | |||||||||||
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||||||
| For the quarterly period ended: | |||||||||||
OR
| 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 000-54799
| (Exact name of registrant as specified in its charter) | ||||||||||||||
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||
| (Address of principal executive offices) | (Registrant's telephone number, including area code) | (Zip code) | ||||||||||||
| N/A | ||||||||||||||
| (Former name, former address and former fiscal year, if changed since last report) | ||||||||||||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
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).
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.
| ☑ | 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 ☑
Number of shares of Class A Common Stock outstanding at May 2, 2025: 14,254,901
Number of shares of Class B Common Stock outstanding at May 2, 2025: 3,452,764
HYSTER-YALE, INC.
TABLE OF CONTENTS
| Page Number | |||||||||||||||||
1
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
HYSTER-YALE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31 2025 | DECEMBER 31 2024 | ||||||||||
| (In millions, except share data) | |||||||||||
| ASSETS | |||||||||||
| Current Assets | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Accounts receivable, net | |||||||||||
| Inventories, net | |||||||||||
| Prepaid expenses and other | |||||||||||
| Total Current Assets | |||||||||||
| Property, Plant and Equipment, Net | |||||||||||
| Intangible Assets, Net | |||||||||||
| Goodwill | |||||||||||
| Deferred Income Taxes | |||||||||||
| Investments in Unconsolidated Affiliates | |||||||||||
| Other Non-current Assets | |||||||||||
| Total Assets | $ | $ | |||||||||
| LIABILITIES AND EQUITY | |||||||||||
| Current Liabilities | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accounts payable, affiliates | |||||||||||
| Revolving credit facilities | |||||||||||
| Short-term debt and current maturities of long-term debt | |||||||||||
| Accrued payroll | |||||||||||
| Deferred revenue | |||||||||||
| Other current liabilities | |||||||||||
| Total Current Liabilities | |||||||||||
| Long-term Debt | |||||||||||
| Self-insurance Liabilities | |||||||||||
| Deferred Income Taxes | |||||||||||
| Other Long-term Liabilities | |||||||||||
| Total Liabilities | |||||||||||
| Temporary Equity | |||||||||||
| Redeemable Noncontrolling Interest | |||||||||||
| Stockholders' Equity | |||||||||||
| Common stock: | |||||||||||
Class A, par value $ | |||||||||||
Class B, par value $ | |||||||||||
| Capital in excess of par value | |||||||||||
| Treasury stock | ( | ( | |||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total Stockholders' Equity | |||||||||||
| Noncontrolling Interests | |||||||||||
| Total Permanent Equity | |||||||||||
| Total Liabilities and Equity | $ | $ | |||||||||
See notes to unaudited condensed consolidated financial statements.
2
HYSTER-YALE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
| THREE MONTHS ENDED | |||||||||||
MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| (In millions, except per share data) | |||||||||||
| Revenues | $ | $ | |||||||||
| Cost of sales | |||||||||||
| Gross Profit | |||||||||||
| Operating Expenses | |||||||||||
| Selling, general and administrative expenses | |||||||||||
| Restructuring charges | |||||||||||
| Operating Profit | |||||||||||
| Other (income) expense | |||||||||||
| Interest expense | |||||||||||
| Income from unconsolidated affiliates | ( | ( | |||||||||
| Other, net | ( | ( | |||||||||
| Income Before Income Taxes | |||||||||||
| Income tax expense | |||||||||||
| Net Income | |||||||||||
Net Income attributable to noncontrolling interests | ( | ||||||||||
Net Loss attributable to redeemable noncontrolling interests | |||||||||||
| Accrued dividend to redeemable noncontrolling interests | ( | ( | |||||||||
Net Income Attributable to Stockholders | $ | $ | |||||||||
Basic Earnings per Share | $ | $ | |||||||||
Diluted Earnings per Share | $ | $ | |||||||||
| Dividends per Share | $ | $ | |||||||||
| Basic Weighted Average Shares Outstanding | |||||||||||
| Diluted Weighted Average Shares Outstanding | |||||||||||
See notes to unaudited condensed consolidated financial statements.
3
HYSTER-YALE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| (In millions) | |||||||||||
| Net Income | $ | $ | |||||||||
Other comprehensive income | |||||||||||
| Foreign currency translation adjustment | ( | ||||||||||
| Current period cash flow hedging activity, net of tax | ( | ||||||||||
| Reclassification of hedging activities into earnings, net of tax | |||||||||||
| Reclassification of pension into earnings, net of tax | |||||||||||
| Comprehensive Income | $ | $ | |||||||||
| Net Income attributable to noncontrolling interests | ( | ||||||||||
| Net Loss attributable to redeemable noncontrolling interests | |||||||||||
| Accrued dividend to redeemable noncontrolling interests | ( | ( | |||||||||
| Foreign currency translation adjustment attributable to noncontrolling interests | |||||||||||
| Comprehensive Income Attributable to Stockholders | $ | $ | |||||||||
See notes to unaudited condensed consolidated financial statements.
4
HYSTER-YALE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| (In millions) | |||||||||||
| Operating Activities | |||||||||||
| Net Income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by (used for) operating activities: | |||||||||||
| Depreciation and amortization | |||||||||||
| Amortization of deferred financing fees | |||||||||||
| Deferred income taxes | ( | ||||||||||
| Restructuring charges | |||||||||||
| Stock-based compensation | |||||||||||
| Dividends from unconsolidated affiliates | |||||||||||
| Other | |||||||||||
| Changes in assets and liabilities: | |||||||||||
| Accounts receivable | ( | ( | |||||||||
| Inventories | ( | ( | |||||||||
| Other current assets | ( | ( | |||||||||
| Accounts payable | |||||||||||
| Other liabilities | ( | ( | |||||||||
| Net cash provided by (used for) operating activities | ( | ||||||||||
| Investing Activities | |||||||||||
| Expenditures for property, plant and equipment | ( | ( | |||||||||
| Proceeds from the sale of assets | |||||||||||
Net cash used for investing activities | ( | ( | |||||||||
| Financing Activities | |||||||||||
| Additions to debt | |||||||||||
| Reductions of debt | ( | ( | |||||||||
| Net change to revolving credit agreements | ( | ||||||||||
| Cash dividends paid | ( | ( | |||||||||
| Purchase of treasury stock | ( | ( | |||||||||
| Net cash provided by (used for) financing activities | ( | ||||||||||
| Effect of exchange rate changes on cash | ( | ||||||||||
| Cash and Cash Equivalents | |||||||||||
| Increase (decrease) for the period | ( | ( | |||||||||
| Balance at the beginning of the period | |||||||||||
| Balance at the end of the period | $ | $ | |||||||||
See notes to unaudited condensed consolidated financial statements.
5
HYSTER-YALE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN TEMPORARY AND PERMANENT EQUITY
| Temporary Equity | Permanent Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Redeemable Noncontrolling Interest | Class A Common Stock | Class B Common Stock | Treasury Stock | Capital in Excess of Par Value | Retained Earnings | Foreign Currency Translation Adjustment | Deferred Gain (Loss) on Cash Flow Hedging | Pension Adjustment | Total Stockholders' Equity | Noncontrolling Interests | Total Permanent Equity | |||||||||||||||||||||||||||||||||||||||||||||
| (In millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2023 | $ | $ | $ | $ | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Stock issued under stock compensation plans | — | — | — | — | ( | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | — | ( | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | ( | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Cash dividends | — | — | — | — | ( | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Accrued dividends | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Current period other comprehensive loss | — | — | — | — | — | — | ( | ( | ( | — | ( | |||||||||||||||||||||||||||||||||||||||||||||
| Reclassification adjustment to net income | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2024 | $ | $ | $ | $ | ( | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | $ | ( | $ | $ | $ | ( | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Stock issued under stock compensation plans | — | — | — | 1.2 | ( | — | — | — | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||||||||||
| Purchase of treasury stock | — | — | — | ( | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | ( | — | — | — | — | — | — | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
| Cash dividends | — | — | — | — | ( | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||
| Accrued dividends | — | — | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
| Current period other comprehensive income | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||
| Reclassification adjustment to net income | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
| Purchase of noncontrolling interest | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation on noncontrolling interest | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | ( | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||
See notes to unaudited condensed consolidated financial statements.
6
HYSTER-YALE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in Millions, Except Per Share Data)
Note 1—Basis of Presentation
The accompanying unaudited condensed consolidated financial statements include the accounts of Hyster-Yale, Inc., a Delaware corporation, and the accounts of Hyster-Yale's wholly owned domestic and international subsidiaries and majority-owned joint ventures (collectively, "Hyster-Yale" or the "Company"). All intercompany accounts and transactions among the consolidated companies are eliminated in consolidation.
The Company, through its wholly owned operating subsidiary, Hyster-Yale Materials Handling, Inc. ("HYMH"), designs, engineers, manufactures, sells and services a comprehensive line of lift trucks, attachments and aftermarket parts marketed globally primarily under the Hyster® and Yale® brand names, mainly to independent Hyster® and Yale® retail dealerships. Lift trucks and component parts are manufactured in the United States ("U.S."), Northern Ireland, China, the Netherlands, Mexico, the Philippines, Brazil, Japan, Italy and Vietnam.
The Company owns a 90% majority interest in Hyster-Yale Maximal Forklift (Zhejiang) Co., Ltd. ("Hyster-Yale Maximal"), a manufacturer of low-intensity and standard lift trucks and specialized material handling equipment. Hyster-Yale Maximal also designs and produces specialized products in the port equipment and rough terrain forklift markets.
The Company operates Bolzoni S.p.A. ("Bolzoni"). Bolzoni is a leading worldwide producer and distributor of attachments, forks and lift tables marketed under the Bolzoni®, Auramo® and Meyer® brand names. Bolzoni also produces components for lift truck manufacturers. Bolzoni products are manufactured in the U.S., Italy, China, Germany and Finland. Through the design, production and distribution of a wide range of attachments, Bolzoni has a strong presence in the market niche of lift truck attachments and industrial material handling.
As of March 31, 2025, the Company operated Nuvera Fuel Cells, LLC ("Nuvera"). Nuvera is an alternative-power technology company focused on the design, manufacture and sale of hydrogen fuel cell stacks and engines. In April 2025, the Company announced a strategic business realignment of Nuvera's operations. See Note 15, Subsequent Events, of the Company's condensed consolidated financial statements for further discussion.
Investments in Sumitomo NACCO Forklift Co., Ltd. (“SN”), a 50 %-owned joint venture, and HYG Financial Services, Inc. ("HYGFS"), a 20 %-owned joint venture, are accounted for by the equity method. The Company’s percentage share of the net income or loss from these equity investments is reported on the line “Income from unconsolidated affiliates” in the “Other (income) expense” section of the unaudited condensed consolidated statements of operations.
These financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the financial position of the Company as of March 31, 2025 and the results of its operations and changes in equity for the three months ended March 31, 2025 and 2024, and the results of its cash flows for the three months ended March 31, 2025 and 2024 have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
The accompanying unaudited condensed consolidated balance sheet at December 31, 2024 has been derived from the audited financial statements at that date but does not include all of the information or notes required by GAAP for complete financial statements.
7
Note 2—Recently Issued Accounting Standards
Adopted Accounting Pronouncements
During the first quarter of 2025, the Company did not adopt any accounting standard updates ("ASU") which had a material effect on the Company's financial position, results of operations, cash flows or related disclosures.
Recent Accounting Pronouncements
The following table provides a brief description of ASUs not yet adopted:
| Standard | Description | Required Date of Adoption | Effect on the financial statements or other significant matters | |||||||||||||||||
| ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740) | The guidance provides requirements for new and updated income tax disclosures. | Annual periods after December 15, 2024 | The Company will apply the guidance for annual periods subsequent to December 15, 2024 for new income tax disclosures. | |||||||||||||||||
| ASU 2024-03— Disaggregation of Income Statement Expenses | The guidance requires disaggregated disclosure of income statement expenses. | December 15, 2026 | The Company is currently evaluating the guidance and the effect on its related disclosures. | |||||||||||||||||
Note 3—Revenue
For contracts with customers that include multiple performance obligations, judgment is required to determine whether performance obligations specified in these contracts are distinct and should be accounted for as separate revenue transactions for recognition purposes. For such arrangements, revenue is allocated to each performance obligation based on its relative standalone selling price. Standalone selling prices are generally determined based on the prices charged to customers or using expected cost plus margin. Impairment losses recognized on receivables or contract assets were not significant for the three months ended March 31, 2025 and 2024.
The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are reported on the line “Selling, general and administrative expenses” in the unaudited condensed consolidated statements of operations.
The Company pays for shipping and handling activities regardless of when control is transferred and has elected to account for shipping and handling as activities to fulfill the promise to transfer the good, rather than a promised service. These costs are reported on the line “Cost of sales” in the unaudited condensed consolidated statements of operations.
8
The following table disaggregates revenue by category:
| THREE MONTHS ENDED | |||||||||||||||||||||||||||||||||||||||||
MARCH 31, 2025 | |||||||||||||||||||||||||||||||||||||||||
| Lift truck business | |||||||||||||||||||||||||||||||||||||||||
| Americas | EMEA | JAPIC | Bolzoni | Nuvera | Eliminations | Total | |||||||||||||||||||||||||||||||||||
| Dealer sales | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Direct customer sales | |||||||||||||||||||||||||||||||||||||||||
| Aftermarket sales | |||||||||||||||||||||||||||||||||||||||||
| Other | ( | ||||||||||||||||||||||||||||||||||||||||
| Total Revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||
| THREE MONTHS ENDED | |||||||||||||||||||||||||||||||||||||||||
| MARCH 31, 2024 | |||||||||||||||||||||||||||||||||||||||||
| Lift truck business | |||||||||||||||||||||||||||||||||||||||||
| Americas | EMEA | JAPIC | Bolzoni | Nuvera | Eliminations | Total | |||||||||||||||||||||||||||||||||||
| Dealer sales | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||
| Direct customer sales | |||||||||||||||||||||||||||||||||||||||||
| Aftermarket sales | |||||||||||||||||||||||||||||||||||||||||
| Other | ( | ||||||||||||||||||||||||||||||||||||||||
| Total Revenues | $ | $ | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||||||
Deferred Revenue: The Company defers revenue for transactions that have not met the criteria for recognition at the time payment is collected, including extended warranties and maintenance contracts. In addition, for certain products, services and customer types, the Company collects payment prior to the transfer of control to the customer. Amounts below include both current and long-term portions of deferred revenue.
| Deferred Revenue | |||||
Balance, December 31, 2024 | $ | ||||
| Customer deposits and billings | |||||
| Revenue recognized | ( | ||||
| Foreign currency effect | |||||
Balance, March 31, 2025 | $ | ||||
Note 4—Business Segments
The Company defines reportable and operating segments on the same basis used to evaluate performance internally by the chief operating decision maker (“CODM”), which the Company has determined is the Chief Executive Officer. The Company uses
9
operating profit (loss) to evaluate segment profitability. The CODM uses operating profit (loss) to allocate resources predominately in the annual forecasting process. The CODM considers forecast-to-actual variances on a monthly basis when assessing segment performance and making decisions about allocating resources to the segments. The Company has five segments, which include three in the lift truck business, as well as Bolzoni and Nuvera.
Operating segments within the lift truck business include the Americas, EMEA and JAPIC, collectively the "lift truck business". Americas includes lift truck operations in the U.S., Canada, Mexico, Brazil, Latin America and the corporate headquarters. EMEA includes operations in Europe, the Middle East and Africa. JAPIC includes operations in the Asia and Pacific regions, including China, as well as the equity earnings of SN operations. Certain amounts are allocated to these geographic operating segments and are included in the reportable segment results presented below, including product development costs, corporate headquarters' expenses and information technology infrastructure costs. These allocations among geographic operating segments are determined by senior management and not directly incurred by the geographic operations. In addition, other costs are incurred directly by these geographic operating segments based upon the location of the manufacturing plant or sales units, including manufacturing variances, product liability, warranty and sales discounts, which may not be associated with the geographic operating segments of the ultimate end user sales location where revenues and margins are reported. Therefore, the reported results of each operating segment for the lift truck business cannot be considered stand-alone entities as all segments are inter-related and integrate into a single global lift truck business.
The Company reports the results of both Bolzoni and Nuvera as separate segments. Intercompany sales between Nuvera, Bolzoni and the lift truck business have been eliminated.
Operating profit is the measure of segment profit or loss. Financial information for each reportable segment is presented in the following table:
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| Revenues from external customers | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | |||||||||||
| Eliminations | ( | ( | |||||||||
| Total | $ | $ | |||||||||
| Cost of Sales | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | |||||||||||
| Eliminations | ( | ( | |||||||||
| Total | $ | $ | |||||||||
| Gross profit (loss) | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | ( | ( | |||||||||
| Eliminations | |||||||||||
| Total | $ | $ | |||||||||
10
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| Selling, general and administrative expenses | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | |||||||||||
| Total | $ | $ | |||||||||
Adjustments(a) | |||||||||||
| Americas | $ | $ | — | ||||||||
| EMEA | ( | — | |||||||||
| JAPIC | — | ||||||||||
| Lift truck business | — | ||||||||||
| Bolzoni | — | — | |||||||||
| Nuvera | — | — | |||||||||
| Eliminations | — | — | |||||||||
| Total | — | ||||||||||
| Operating profit (loss) | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | ( | ||||||||||
| JAPIC | ( | ( | |||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | ( | ( | |||||||||
| Eliminations | |||||||||||
| Total | $ | $ | |||||||||
| Interest expense | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Eliminations | ( | ( | |||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | |||||||||||
| Eliminations | ( | ( | |||||||||
| Total | |||||||||||
| Depreciation and amortization | |||||||||||
| Americas | $ | $ | |||||||||
| EMEA | |||||||||||
| JAPIC | |||||||||||
| Lift truck business | |||||||||||
| Bolzoni | |||||||||||
| Nuvera | |||||||||||
| Total | $ | $ | |||||||||
11
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| Capital expenditures | |||||||||||
| Americas | $ | 5.9 | $ | 5.1 | |||||||
| EMEA | 1.1 | 0.2 | |||||||||
| JAPIC | 1.2 | 0.4 | |||||||||
| Lift truck business | 8.2 | 5.7 | |||||||||
| Bolzoni | 2.2 | 0.9 | |||||||||
| Nuvera | 0.2 | 0.9 | |||||||||
| Total | $ | 10.6 | $ | 7.5 | |||||||
(a) Consists of restructuring charges (reversals) recognized during the first quarter of 2025 related to programs initiated in 2024. See Note 14, Restructuring, of the Company's condensed consolidated financial statements for further discussion.
| MARCH 31 2025 | DECEMBER 31 2024 | ||||||||||
| Total assets | |||||||||||
| Americas | $ | 1,947.0 | $ | 1,897.9 | |||||||
| EMEA | 666.6 | 678.5 | |||||||||
| JAPIC | 248.9 | 252.9 | |||||||||
| Eliminations | (638.3) | (637.7) | |||||||||
| Lift truck business | 2,224.2 | 2,191.6 | |||||||||
| Bolzoni | 309.5 | 290.8 | |||||||||
| Nuvera | 39.3 | 40.7 | |||||||||
| Eliminations | (517.7) | $ | (493.9) | ||||||||
| Total | 2,055.3 | 2,029.2 | |||||||||
Note 5—Income Taxes
The income tax provision includes U.S. federal, state and local, and foreign income taxes and is generally based on the application of a forecasted annual income tax rate applied to the current quarter's year-to-date pre-tax income or loss. In determining the estimated annual effective income tax rate, the Company analyzes various factors, including projections of the Company's annual earnings or losses, taxing jurisdictions in which the earnings or losses will be generated, the impact of state and local income taxes, the Company's ability to use tax credits and net operating loss carryforwards, carrybacks, capital loss carryforwards, and available tax planning alternatives. Discrete items, including the effect of changes in tax laws, tax rates and certain circumstances with respect to valuation allowances or the tax effect of other unusual or nonrecurring transactions or adjustments are reflected in the period in which they occur as an addition to, or reduction from, the income tax provision, rather than included in the estimated annual effective income tax rate. Additionally, the Company's interim effective income tax rate is computed and applied without regard to pre-tax losses where such losses are not expected to generate a current-year tax benefit.
12
A reconciliation of the U.S. federal statutory rate to the reported income tax rate is as follows:
| THREE MONTHS ENDED | ||||||||||||||
| MARCH 31 | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Income before income taxes | $ | $ | ||||||||||||
| Statutory taxes (21%) | $ | $ | ||||||||||||
| Interim adjustment | ||||||||||||||
| Permanent adjustments: | ||||||||||||||
| Valuation allowance | ||||||||||||||
| Other | ||||||||||||||
| Discrete items | ||||||||||||||
| Income tax expense | $ | $ | ||||||||||||
| Reported income tax rate | % | % | ||||||||||||
During 2025 and 2024, the Company’s reported income tax rate differs from the U.S. federal statutory rate primarily as a result of recording additional valuation allowance attributable to the capitalization of research and development expenses under current U.S. tax rules.
Note 6—Reclassifications from OCI
The following table summarizes reclassifications out of Accumulated Other Comprehensive Income ("OCI") as recorded in the unaudited condensed consolidated statements of operations:
| OCI Components | Amount Reclassified from OCI | Affected Line Item | ||||||||||||||||||
| THREE MONTHS ENDED | ||||||||||||||||||||
| MARCH 31 | ||||||||||||||||||||
| 2025 | 2024 | |||||||||||||||||||
| Gain (loss) on cash flow hedges: | ||||||||||||||||||||
| Interest rate contracts | $ | $ | ||||||||||||||||||
| Foreign exchange contracts | ( | ( | ||||||||||||||||||
| Total before tax | ( | ( | ||||||||||||||||||
| Tax (expense) benefit | ( | |||||||||||||||||||
| Net of tax | $ | ( | $ | ( | ||||||||||||||||
| Amortization of defined benefit pension items: | ||||||||||||||||||||
| Actuarial loss | $ | ( | $ | ( | ||||||||||||||||
| Total before tax | ( | ( | ||||||||||||||||||
| Tax (expense) benefit | ||||||||||||||||||||
| Net of tax | $ | ( | $ | ( | ||||||||||||||||
| Total reclassifications for the period | $ | ( | $ | ( | ||||||||||||||||
Note 7—Financial Instruments and Derivative Financial Instruments
Financial Instruments
The carrying amounts of cash and cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term maturities of these instruments. The fair values of revolving credit agreements and long-term debt, excluding finance leases, were determined using current rates offered for similar obligations taking into account company credit risk. This valuation methodology is Level 2 as defined in the fair value hierarchy. At March 31, 2025, the carrying value and fair value of revolving credit agreements and long-term debt, excluding finance leases, was $460.4 million and $459.9 million, respectively. At December 31, 2024, the carrying value and fair value of revolving credit agreements and long-term debt, excluding finance leases, was $417.3 million and $416.8 million, respectively.
13
Derivative Financial Instruments
The Company uses forward foreign currency exchange contracts to partially reduce risks related to transactions denominated in foreign currencies. These contracts hedge firm commitments and forecasted transactions relating to cash flows associated with sales and purchases denominated in non-functional currencies. The Company offsets fair value amounts related to foreign currency exchange contracts executed with the same counterparty. Changes in the fair value of forward foreign currency exchange contracts that are effective as hedges are recorded in OCI. Deferred gains or losses are reclassified from OCI to the unaudited condensed consolidated statements of operations in the same period as the gains or losses from the underlying transactions are recorded and are generally recognized in cost of sales.
The Company periodically enters into foreign currency exchange contracts that do not meet the criteria for hedge accounting. These derivatives are used to reduce the Company's exposure to foreign currency risk related to forecasted purchase or sales transactions or forecasted intercompany cash payments or settlements. Gains and losses on these derivatives are generally recognized in cost of sales.
The Company uses interest rate swap agreements to partially reduce risks related to floating rate financing agreements that are subject to changes in the market rate of interest. Terms of the interest rate swap agreements require the Company to receive a variable interest rate and pay a fixed interest rate. The Company's interest rate swap agreements and the associated variable rate financings are predominately based upon the one-month Secured Overnight Financing Rate ("SOFR"). Changes in the fair value of interest rate swap agreements that are effective as hedges are recorded in OCI. Deferred gains or losses are reclassified from OCI to the unaudited condensed consolidated statements of operations in the same period as the gains or losses from the underlying transactions are recorded and are generally recognized in interest expense.
Cash flows from hedging activities are reported in the unaudited condensed consolidated statements of cash flows with the same classification as the hedged item, generally as a component of cash flows from operations.
The Company does not currently hold any nonderivative instruments designated as hedges or any derivatives designated as fair value hedges.
Foreign Currency Derivatives: The Company held forward foreign currency exchange contracts with total notional amounts of $0.8 billion at March 31, 2025 and December 31, 2024, primarily denominated in euros, U.S. dollars, Japanese yen, Chinese renminbi, Mexican pesos, British pounds, Swedish kroner and Australian dollars. The fair value of these contracts approximated a net asset of $0.6 million and a net liability of $18.5 million at March 31, 2025 and December 31, 2024, respectively.
At March 31, 2025 and December 31, 2024, there was no material ineffectiveness of forward foreign currency exchange contracts that qualify for hedge accounting. Forward foreign currency exchange contracts that qualify for hedge accounting are generally used to hedge transactions expected to occur within the next 36 months. The mark-to-market effect of forward foreign currency exchange contracts that are considered effective as hedges has been included in OCI. Based on market valuations at March 31, 2025, $4.1 million of the amount of net deferred loss included in OCI at March 31, 2025 is expected to be reclassified as expense into the unaudited condensed consolidated statements of operations over the next twelve months, as the transactions occur.
Interest Rate Derivatives: The following table summarizes the notional amounts, related rates, excluding spreads, and remaining terms of interest rate swap agreements at March 31, 2025 and December 31, 2024:
| Notional Amount | Average Fixed Rate | |||||||||||||||||||||||||
| MARCH 31, | DECEMBER 31 | MARCH 31, | DECEMBER 31 | |||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | Term at March 31, 2025 | ||||||||||||||||||||||
| $ | $ | % | % | Extending to May 2027 | ||||||||||||||||||||||
| $ | $ | % | % | Extending to July 2029 | ||||||||||||||||||||||
14
The fair value of all interest rate swap agreements was a net asset of $7.6 million and $9.9 million at March 31, 2025 and December 31, 2024, respectively. The mark-to-market effect of interest rate swap agreements that are considered effective as hedges has been included in OCI. Based on market valuations at March 31, 2025, $4.7 million of the amount included in OCI as net deferred gain is expected to be reclassified as income in the unaudited condensed consolidated statements of operations over the next twelve months, as cash flow payments are made in accordance with the interest rate swap agreements.
The following table summarizes the fair value of derivative instruments reflected on a gross basis by contract as recorded in the unaudited condensed consolidated balance sheets:
| Asset Derivatives | Liability Derivatives | ||||||||||||||||||||||||||||||||||
| Balance Sheet Location | MARCH 31, 2025 | DECEMBER 31, 2024 | Balance Sheet Location | MARCH 31, 2025 | DECEMBER 31, 2024 | ||||||||||||||||||||||||||||||
| Derivatives designated as hedging instruments | |||||||||||||||||||||||||||||||||||
| Cash Flow Hedges | |||||||||||||||||||||||||||||||||||
| Interest rate swap agreements | |||||||||||||||||||||||||||||||||||
| Current | Prepaid expenses and other | $ | $ | Prepaid expenses and other | $ | $ | |||||||||||||||||||||||||||||
| Long-term | Other non-current assets | Other non-current assets | |||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | |||||||||||||||||||||||||||||||||||
| Current | Prepaid expenses and other | Prepaid expenses and other | |||||||||||||||||||||||||||||||||
| Other current liabilities | Other current liabilities | ||||||||||||||||||||||||||||||||||
| Long-term | Other non-current assets | Other non-current assets | |||||||||||||||||||||||||||||||||
| Other long-term liabilities | Other long-term liabilities | ||||||||||||||||||||||||||||||||||
| Total derivatives designated as hedging instruments | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Derivatives not designated as hedging instruments | |||||||||||||||||||||||||||||||||||
| Cash Flow Hedges | |||||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | |||||||||||||||||||||||||||||||||||
| Current | Prepaid expenses and other | Prepaid expenses and other | |||||||||||||||||||||||||||||||||
| Other current liabilities | Other current liabilities | ||||||||||||||||||||||||||||||||||
| Total derivatives not designated as hedging instruments | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
| Total derivatives | $ | $ | $ | $ | |||||||||||||||||||||||||||||||
The following table summarizes the offsetting of the fair value of derivative instruments on a gross basis by counterparty as recorded in the unaudited condensed consolidated balance sheets:
Derivative Assets as of March 31, 2025 | Derivative Liabilities as of March 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Gross Amounts of Recognized Assets | Gross Amounts Offset | Net Amounts Presented | Net Amount | Gross Amounts of Recognized Liabilities | Gross Amounts Offset | Net Amounts Presented | Net Amount | |||||||||||||||||||||||||||||||||||||||||||
| Cash Flow Hedges | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest rate swap agreements | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total derivatives | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Derivative Assets as of December 31, 2024 | Derivative Liabilities as of December 31, 2024 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Gross Amounts of Recognized Assets | Gross Amounts Offset | Net Amounts Presented | Net Amount | Gross Amounts of Recognized Liabilities | Gross Amounts Offset | Net Amounts Presented | Net Amount | |||||||||||||||||||||||||||||||||||||||||||
| Cash Flow Hedges | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest rate swap agreements | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||||||
| Total derivatives | $ | $ | ( | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
15
The following table summarizes the pre-tax impact of derivative instruments as recorded in the unaudited condensed consolidated statements of operations:
| Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion) | Location of Gain or (Loss) Reclassified from OCI into Income (Effective Portion) | Amount of Gain or (Loss) Reclassified from OCI into Income (Effective Portion) | ||||||||||||||||||||||||||||||
| THREE MONTHS ENDED | THREE MONTHS ENDED | |||||||||||||||||||||||||||||||
| MARCH 31, | MARCH 31, | |||||||||||||||||||||||||||||||
| Derivatives Designated as Hedging Instruments | 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||||||||||
| Cash Flow Hedges | ||||||||||||||||||||||||||||||||
| Interest rate swap agreements | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||
| Foreign currency exchange contracts | ( | ( | ( | |||||||||||||||||||||||||||||
| Total | $ | $ | ( | $ | ( | $ | ( | |||||||||||||||||||||||||
| Derivatives Not Designated as Hedging Instruments | Location of Gain or (Loss) Recognized in Income on Derivative | 2025 | 2024 | |||||||||||||||||||||||||||||
| Cash Flow Hedges | ||||||||||||||||||||||||||||||||
| Foreign currency exchange contracts | $ | $ | ( | |||||||||||||||||||||||||||||
| Total | $ | $ | ( | |||||||||||||||||||||||||||||
Note 8—Retirement Benefit Plans
The Company maintains various defined benefit pension plans that provide benefits based on years of service and average compensation during certain periods. The Company's policy is to make contributions to fund these plans within the range allowed by applicable regulations. Plan assets consist primarily of publicly traded stocks and government and corporate bonds.
Pension benefits for employees covered under the Company's U.S. and United Kingdom ("U.K.") plans are frozen. Only certain grandfathered employees in the Netherlands still earn retirement benefits under a defined benefit pension plan. All other eligible employees of the Company, including employees whose pension benefits are frozen, receive retirement benefits under defined contribution retirement plans. During 2024, the Company and the trustee initiated a de-risking strategy for the U.K. plan, which resulted in changes to the target asset allocation to fixed income and highly-liquid securities. In the first quarter of 2025, the trustee entered into a buy-in contract for the U.K. plan with a third-party insurance company. The trustee may choose to convert the buy-in policy to a buy-out contract by assigning individual insurance contracts to members. This process may extend for a significant period of time. Until any potential buy-out process is completed, the trustee remains responsible for the administration of the U.K. plan, allocation of non-insured plan assets and payment of employee retirement benefits. If a buy-out of the U.K. plan is completed in the future and the criteria for settlement accounting is satisfied, any amounts relating to the U.K. plan remaining in accumulated other comprehensive income (loss) will be reclassified into earnings.
The Company presents the components of net periodic pension expense (benefit), other than service cost, in other (income) expense in the unaudited condensed consolidated statements of operations for its pension plans. Service cost for the Company's pension plan is reported in operating profit. The components of pension expense (benefit) are set forth below:
16
| THREE MONTHS ENDED | |||||||||||
| MARCH 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| U.S. Pension | |||||||||||
| Interest cost | $ | $ | |||||||||
| Expected return on plan assets | ( | ( | |||||||||
| Amortization of actuarial loss | |||||||||||
| Net periodic pension expense | $ | $ | |||||||||
| Non-U.S. Pension | |||||||||||
| Interest cost | |||||||||||
| Expected return on plan assets | ( | ( | |||||||||
| Amortization of actuarial loss | |||||||||||
| Net periodic pension expense (benefit) | $ | $ | ( | ||||||||
Note 9—Inventories
Inventories are summarized as follows:
MARCH 31, 2025 | DECEMBER 31, 2024 | ||||||||||
| Finished goods and service parts | $ | $ | |||||||||
| Work in process | |||||||||||
| Raw materials | |||||||||||
| Total manufactured inventories | |||||||||||
| LIFO reserve | ( | ( | |||||||||
| Total inventory | $ | $ | |||||||||
Note 10—Product Warranties
In addition, the Company sells separately priced, extended warranty agreements for its lift trucks, which generally provide a warranty for an additional two to five years or up to 2,400 to 10,000 operating hours . The specific terms and conditions of those warranties vary depending upon the product sold and the country in which the Company does business. Revenue received for the sale of extended warranty contracts is deferred and recognized in the same manner as the costs incurred to perform under the warranty contracts.
The Company also maintains a quality enhancement program under which it provides for specifically identified field product improvements as part of its warranty obligation. Accruals under this program are determined based on estimates of the potential number of claims and the cost of those claims based on historical and anticipated costs.
17
The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Factors that affect the warranty liability include the number of units sold, historical and anticipated rates of warranty claims and the cost per claim.
Changes in the Company's current and long-term warranty obligations, including deferred revenue on extended warranty contracts, are as follows:
| 2025 | |||||
Balance at December 31, 2024 | $ | ||||
| Current year warranty expense | |||||
| Change in estimate related to pre-existing warranties | |||||
| Payments made | ( | ||||
| Foreign currency effect | |||||
Balance at March 31, 2025 | $ | ||||
Note 11—Contingencies
Various legal and regulatory proceedings and claims have been or may be asserted against the Company relating to the conduct of its businesses, including product liability, environmental and other claims. These proceedings and claims are incidental to the ordinary course of business. Management believes that it has meritorious defenses and will vigorously defend the Company in these actions. Any costs that management estimates will be paid as a result of these claims are accrued when the liability is considered probable and the amount can be reasonably estimated. Although the ultimate disposition of these proceedings is not presently determinable, management believes, after consultation with its legal counsel, that the likelihood is remote that costs will be incurred materially in excess of accruals already recognized.
Note 12—Guarantees
Under various financing arrangements for certain customers, including independent retail dealerships, the Company provides recourse or repurchase obligations such that it would be obligated in the event of default by the customer. Terms of the third-party financing arrangements for which the Company is providing recourse or repurchase obligations generally range from to five years . Total amounts subject to recourse or repurchase obligations at March 31, 2025 and December 31, 2024 were $167.9 million and $219.2 million, respectively. As of March 31, 2025, losses anticipated under the terms of the recourse or repurchase obligations were not significant and reserves have been provided for such losses based on historical experience in the accompanying unaudited condensed consolidated financial statements. The Company generally retains a security interest in the related assets financed such that, in the event the Company would become obligated under the terms of the recourse or repurchase obligations, the Company would take title to the assets financed. The fair value of collateral held at March 31, 2025 was approximately $261.3 million based on Company estimates. The Company estimates the fair value of the collateral using information regarding the original sales price, the current age of the equipment and general market conditions that influence the value of both new and used lift trucks. The Company also regularly monitors the external credit ratings of the entities for which it has provided recourse or repurchase obligations. As of March 31, 2025, the Company did not believe there was a significant risk of non-payment or non-performance of the obligations by these entities; however, there can be no assurance that the risk may not increase in the future. In addition, the Company has an agreement with Wells Fargo Financial Leasing, Inc. ("WF") to limit its exposure to losses at certain eligible dealers. Under this agreement, losses related to $39.5 million of recourse or repurchase obligations for these certain eligible dealers are limited to 7.5 % of their original loan balance, or $18.5 million as of March 31, 2025. The $39.5 million is included in the $167.9 million of total amounts subject to recourse or repurchase obligations at March 31, 2025.
Generally, the Company sells lift trucks through its independent dealer network or directly to customers. These dealers and customers may enter into a financing transaction with HYGFS or other unrelated third parties. HYGFS provides debt and lease financing to both dealers and customers. On occasion, the credit quality of a customer or credit concentration issues within WF may require the Company to provide recourse or repurchase obligations of the lift trucks purchased by customers and financed through HYGFS. At March 31, 2025, approximately $141.8 million of the Company's total recourse or repurchase obligations of $167.9 million related to transactions with HYGFS. In connection with the joint venture agreement, the Company also provides a guarantee to WF for 20 % of HYGFS’ debt with WF, such that the Company would become liable under the terms of HYGFS’ debt agreements with WF in the case of default by HYGFS. At March 31, 2025, loans from WF to HYGFS totaled $1.4 billion. Although the Company’s contractual guarantee was $291.9 million, the loans by WF to HYGFS are secured by HYGFS’ customer receivables, of which the Company guarantees $141.8 million. Excluding the HYGFS receivables guaranteed by the Company from HYGFS’ loans to WF, the Company’s incremental obligation as a result of this guarantee to WF is $246.6 million, which is secured by the Company's 20% share of HYGFS' customer receivables and other secured assets
18
of $334.7 million. HYGFS has not defaulted under the terms of this debt financing in the past, and although there can be no assurances, the Company is not aware of any circumstances that would cause HYGFS to default in future periods.
Note 13—Equity and Debt Investments
The Company maintains an interest in one variable interest entity, HYGFS. HYGFS is a joint venture with WF formed primarily for the purpose of providing financial services to independent Hyster® and Yale® lift truck dealers and major customers in the U.S. and is included in the Americas segment. The Company does not have a controlling financial interest or have the power to direct the activities that most significantly affect the economic performance of HYGFS. Therefore, the Company is not the primary beneficiary and uses the equity method to account for its 20 % interest in HYGFS. The Company does not consider its variable interest in HYGFS to be significant.
The Company has a 50 % ownership interest in SN, a limited liability company which was formed with Sumitomo Heavy Industries, Ltd. ("Sumitomo") primarily to manufacture and distribute Sumitomo-branded lift trucks in Japan and export Hyster®- and Yale®-branded lift trucks and related components and service parts outside of Japan. The Company purchases products from SN under agreed-upon terms. The Company's ownership in SN is also accounted for using the equity method of accounting and is included in the JAPIC segment.
The Company's percentage share of the net income or loss from its equity investments in HYGFS and SN is reported on the line “Income from unconsolidated affiliates” in the “Other (income) expense” section of the unaudited condensed consolidated statements of operations. The Company's equity investments are included on the line “Investments in Unconsolidated Affiliates” in the unaudited condensed consolidated balance sheets.
The Company's equity investments in unconsolidated affiliates recorded on the unaudited condensed consolidated balance sheets are as follows:
| March 31, 2025 | December 31, 2024 | ||||||||||
| HYGFS | $ | $ | |||||||||
| SN | |||||||||||
| Bolzoni investments | |||||||||||
Dividends received from unconsolidated affiliates are summarized below:
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| HYGFS | $ | $ | |||||||||
Summarized financial information for HYGFS and SN is as follows:
| THREE MONTHS ENDED | |||||||||||
| MARCH 31 | |||||||||||
| 2025 | 2024 | ||||||||||
| Revenues | $ | $ | |||||||||
| Gross profit | |||||||||||
| Income from continuing operations, net of tax | |||||||||||
| Net income | |||||||||||
The Company has a debt investment in a third party, OneH2, Inc. The Company's investment was $0.8
Note 14—Restructuring
In the first quarter of 2025, the Company recognized restructuring charges of $0.2 million ($0.7 million in the Americas, $(1.3 ) million reversal in EMEA and $0.8 million in JAPIC) for employee-severance and other-related costs for the programs initiated in 2024 to streamline the Company's manufacturing footprint and optimize its operations by reducing costs and improving operational efficiency. These costs are included in "Restructuring charges" in the unaudited condensed consolidated statements of operations.
19
The Company expects to execute these programs over the next 12 to 36 months. As of March 31, 2025, the Company estimates incurring additional restructuring charges of approximately $8 million to $16 million in each of 2025 and 2026 related to these plans.
Following is the detail of the cash charges related to this program:
| Severance | |||||
| Balance, January 1, 2024 | $ | ||||
| Charges | |||||
| Payments | ( | ||||
| Reversals | ( | ||||
| Balance, March 31, 2025 | $ | ||||
Note 15—Subsequent Events
20
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
(Dollars in Millions, Except Per Share Data)
Hyster-Yale, Inc. ("Hyster-Yale" or the "Company") and its subsidiaries, including its operating company, Hyster-Yale Materials Handling, Inc. ("HYMH"), is a globally integrated company offering a full line of high-quality, application-tailored lift trucks and solutions aimed at meeting the specific materials handling needs of its customers. The Company's solutions include attachments and hydrogen fuel cell power products, telematics, automation and fleet management services, as well as a variety of other power options for its lift trucks.
The Company, through HYMH, designs, engineers, manufactures, sells and services a comprehensive line of lift trucks, attachments and aftermarket parts marketed globally, primarily under the Hyster® and Yale® brand names, mainly to independent Hyster® and Yale® retail dealerships. The Company's distribution network consisted of approximately 310 independent dealers as of March 31, 2025. The materials handling business historically has been cyclical because the order rate for lift trucks fluctuates depending on the economic activity level in the various industries and countries its customers serve. Lift trucks and component parts are manufactured in the United States, Northern Ireland, China, the Netherlands, Mexico, the Philippines, Brazil, Japan, Italy and Vietnam.
The Company owned a 90% majority interest in Hyster-Yale Maximal Forklift (Zhejiang) Co., Ltd. ("Hyster-Yale Maximal"), a manufacturer of low-intensity and standard lift trucks and specialized material handling equipment. Hyster-Yale Maximal also designs and produces specialized products in the port equipment and rough terrain forklift markets.
The Company operates Bolzoni S.p.A. ("Bolzoni"). Bolzoni is a leading worldwide producer and distributor of attachments, forks and lift tables marketed under the Bolzoni®, Auramo® and Meyer® brand names. Bolzoni also produces components for lift truck manufacturers. Bolzoni products are manufactured in the United States, Italy, China, Germany and Finland. Through the design, production and distribution of a wide range of attachments, Bolzoni has a strong presence in the market niche of lift truck attachments and industrial material handling.
As of March 31, 2025, the Company operated Nuvera Fuel Cells, LLC ("Nuvera"). Nuvera is an alternative-power technology company focused on the design, manufacture and sale of hydrogen fuel cell stacks and engines. In April 2025, the Company announced a strategic business realignment of Nuvera's operations. See Note 15, Subsequent Events, of the Company's condensed consolidated financial statements for further discussion.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
Please refer to the discussion of Critical Accounting Policies and Estimates as disclosed on pages 19 through 20 in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. Critical Accounting Policies and Estimates have not materially changed since December 31, 2024.
FINANCIAL REVIEW
The results of operations for the Company were as follows:
| THREE MONTHS ENDED | Favorable / (Unfavorable) | ||||||||||||||||
| MARCH 31, | |||||||||||||||||
| 2025 | 2024 | % Change | |||||||||||||||
| Revenues | |||||||||||||||||
| Americas | $ | $ | (9.2) | % | |||||||||||||
| EMEA | (40.7) | % | |||||||||||||||
| JAPIC | 25.5 | % | |||||||||||||||
| Lift truck business | (14.1) | % | |||||||||||||||
| Bolzoni | (16.5) | % | |||||||||||||||
| Nuvera | (100.0) | % | |||||||||||||||
| Eliminations | ( | ( | (27.0) | % | |||||||||||||
| $ | $ | (13.8) | % | ||||||||||||||
21
| THREE MONTHS ENDED | Favorable / (Unfavorable) | ||||||||||||||||
| MARCH 31, | |||||||||||||||||
| 2025 | 2024 | % Change | |||||||||||||||
| Gross profit (loss) | |||||||||||||||||
| Americas | $ | $ | (18.9) | % | |||||||||||||
| EMEA | (61.9) | % | |||||||||||||||
| JAPIC | (5.6) | % | |||||||||||||||
| Lift truck business | (25.4) | % | |||||||||||||||
| Bolzoni | (15.1) | % | |||||||||||||||
| Nuvera | ( | ( | 13.0 | % | |||||||||||||
| Eliminations | n.m. | ||||||||||||||||
| $ | $ | (24.6) | % | ||||||||||||||
| Selling, general and administrative expenses | |||||||||||||||||
| Americas | $ | $ | (3.3) | % | |||||||||||||
| EMEA | (1.4) | % | |||||||||||||||
| JAPIC | (8.8) | % | |||||||||||||||
| Lift truck business | (3.2) | % | |||||||||||||||
| Bolzoni | 3.2 | % | |||||||||||||||
| Nuvera | (11.3) | % | |||||||||||||||
| $ | $ | (2.8) | % | ||||||||||||||
| Restructuring charges (reversal) | |||||||||||||||||
| Americas | $ | $ | — | n.m. | |||||||||||||
| EMEA | (1.3) | — | n.m. | ||||||||||||||
| JAPIC | 0.8 | — | n.m. | ||||||||||||||
| Lift truck business | 0.2 | — | n.m. | ||||||||||||||
| Bolzoni | — | — | n.m. | ||||||||||||||
| Nuvera | — | — | n.m. | ||||||||||||||
| Eliminations | — | — | n.m. | ||||||||||||||
| $ | 0.2 | $ | — | n.m | |||||||||||||
| Operating profit (loss) | |||||||||||||||||
| Americas | $ | $ | (41.5) | % | |||||||||||||
| EMEA | ( | (386.5) | % | ||||||||||||||
| JAPIC | ( | ( | (32.7) | % | |||||||||||||
| Lift truck business | (66.2) | % | |||||||||||||||
| Bolzoni | (81.8) | % | |||||||||||||||
| Nuvera | ( | ( | (5.3) | % | |||||||||||||
| Eliminations | n.m. | ||||||||||||||||
| $ | 21.3 | $ | 83.8 | (74.6) | % | ||||||||||||
| Interest expense | $ | $ | 8.9 | 13.5 | % | ||||||||||||
| Other income | $ | (3.2) | $ | (3.1) | 3.2 | % | |||||||||||
| Net income attributable to stockholders | $ | $ | (83.3) | % | |||||||||||||
| Diluted earnings per share | $ | $ | 2.93 | (83.6) | % | ||||||||||||
| Reported income tax rate | % | % | |||||||||||||||
| n.m. - not meaningful | |||||||||||||||||
22
The following is the detail of the approximate sales value of the Company's lift truck unit bookings dollar value and lift truck backlog dollar value. The dollar value of bookings and backlog is calculated using the current unit bookings and backlog and the forecasted average sales price per unit. As of March 31, 2025, substantially all of the Company's backlog is expected to be sold within the next twelve months.
| THREE MONTHS ENDED | ||||||||||||||
| MARCH 31 | ||||||||||||||
| 2025 | 2024 | |||||||||||||
| Bookings, approximate sales value | $ | 590 | $ | 520 | ||||||||||
| Backlog, approximate sales value | $ | 1,910 | $ | 3,060 | ||||||||||
First Quarter of 2025 Compared with First Quarter of 2024
The following table identifies the components of change in revenues for the first quarter of 2025 compared with the first quarter of 2024:
| Revenues | |||||||||||||||||
| Lift Truck | |||||||||||||||||
| HY | Americas | EMEA | JAPIC | ||||||||||||||
| 2024 | $ | $ | $ | $ | |||||||||||||
Increase (decrease) in 2025 from: | |||||||||||||||||
| Lift Truck | |||||||||||||||||
| Unit volume and product mix | (162.7) | (102.4) | (70.0) | 9.7 | |||||||||||||
| Foreign currency | (11.3) | (5.0) | (5.3) | (1.0) | |||||||||||||
| Other | 22.7 | 26.3 | (3.6) | — | |||||||||||||
| Parts | 5.3 | 3.9 | 0.5 | 0.9 | |||||||||||||
| Price | 3.6 | 6.4 | (2.8) | — | |||||||||||||
| Bolzoni revenues | (15.9) | — | — | — | |||||||||||||
| Nuvera revenues | (0.5) | — | — | — | |||||||||||||
| Eliminations | 12.7 | — | — | — | |||||||||||||
| 2025 | $ | 910.4 | $ | 698.9 | $ | 118.2 | $ | 47.3 | |||||||||
Revenues decreased 13.8% to $910.4 million in the first quarter of 2025 from $1,056.5 million in the first quarter of 2024. The decrease in Lift Truck revenues was primarily due to a decline in unit volume, mainly in the Americas and EMEA. The decrease was partially offset by higher other revenues, including improved fleet services revenue.
Bolzoni's revenues decreased in the first quarter of 2025 compared with the first quarter of 2024, primarily due to lower unit volume. Nuvera's revenues decreased in the first quarter of 2025 compared with the first quarter of 2024, mainly as a result of lower intercompany sales to the lift truck business.
The following table identifies the components of change in operating profit (loss) for the first quarter of 2025 compared with the first quarter of 2024:
| Operating Profit (Loss) | ||||||||||||||
| Lift Truck | ||||||||||||||
| HY | Americas | EMEA | JAPIC | |||||||||||
| 2024 | $ | 83.8 | $ | $ | $ | ( | ||||||||
Increase (decrease) in 2025 from: | ||||||||||||||
| Lift truck gross profit | (55.0) | (33.6) | (21.0) | (0.2) | ||||||||||
| Lift truck selling, general and administrative expenses | (4.1) | (2.9) | (0.4) | (0.8) | ||||||||||
| Restructuring | (0.2) | (0.7) | 1.3 | (0.8) | ||||||||||
| Bolzoni operations | (2.7) | — | — | — | ||||||||||
| Nuvera operations | (0.5) | — | — | — | ||||||||||
| 2025 | $ | 21.3 | $ | 52.4 | $ | (14.9) | $ | (7.3) | ||||||
23
The Company recognized operating profit of $21.3 million in the first quarter of 2025 compared with $83.8 million in the first quarter of 2024. The decrease in Lift Truck operating profit was primarily due to lower gross profit, mainly from lower volume and higher material and freight costs, as well as lower overhead absorption rates. Additionally, selling, general and administrative expenses were higher, primarily related to increased marketing, product development and information technology costs.
Operating profit in the Americas decreased to $52.4 million in the first quarter of 2025 compared with $89.6 million in the first quarter of 2024. The decrease was due to lower gross profit primarily from lower overhead absorption rates tied to lower production volume and higher warranty and freight costs. These decreases were partially offset by improved pricing.
EMEA recognized an operating loss of $14.9 million in the first quarter of 2025 compared with operating profit of $5.2 million in the first quarter of 2024. The decrease was primarily due to lower gross profit from lower unit volume as well as lower overhead absorption rates tied to lower production volume.
The operating loss in JAPIC was $7.3 million in the first quarter of 2025 compared with $5.5 million in the first quarter of 2024, mainly due to higher marketing costs and an $0.8 million restructuring charge.
Bolzoni's operating profit decreased to $0.6 million in the first quarter of 2025 compared with $3.3 million in the first quarter of 2024, primarily due to lower unit volumes and unfavorable foreign currency movements.
The operating loss at Nuvera increased in the first quarter of 2025 compared with the first quarter of 2024, mainly due to lower product development funding from third-parties. This was partially offset by savings realized through head count reduction initiatives implemented in 2024.
The Company recognized net income attributable to stockholders of $8.6 million in the first quarter of 2025 compared with $51.5 million in the first quarter of 2024. The decline was primarily the result of lower operating profit in addition to a higher effective income tax rate in the first quarter of 2025 compared with the first quarter of 2024. See Note 5, Income Taxes, of the Company's condensed consolidated financial statements for further discussion of the Company's income tax provision.
LIQUIDITY AND CAPITAL RESOURCES
Cash Flows
The following tables detail the changes in cash flow for the three months ended March 31, 2025 compared to the same period in the prior year:
| 2025 | 2024 | Change | |||||||||||||||
| Operating activities: | |||||||||||||||||
| Net Income | $ | 8.7 | $ | 51.8 | $ | (43.1) | |||||||||||
| Depreciation and amortization | 11.0 | 11.7 | (0.7) | ||||||||||||||
| Stock-based compensation | 3.5 | 9.2 | (5.7) | ||||||||||||||
| Dividends from unconsolidated affiliates | 8.0 | 4.4 | 3.6 | ||||||||||||||
| Other operating activities | 5.9 | 4.0 | 1.9 | ||||||||||||||
| Changes in assets and liabilities | |||||||||||||||||
| Accounts receivable | (8.0) | (28.2) | 20.2 | ||||||||||||||
| Inventories | (6.8) | (37.6) | 30.8 | ||||||||||||||
| Other current assets | (4.2) | (7.7) | 3.5 | ||||||||||||||
| Accounts payable and other liabilities | (54.5) | 14.8 | (69.3) | ||||||||||||||
| Net cash provided by (used for) operating activities | (36.4) | 22.4 | (58.8) | ||||||||||||||
| Investing activities: | |||||||||||||||||
| Expenditures for property, plant and equipment | (10.6) | (7.5) | (3.1) | ||||||||||||||
| Proceeds from the sale of assets | 0.3 | 0.5 | (0.2) | ||||||||||||||
| Net cash used for investing activities | (10.3) | (7.0) | (3.3) | ||||||||||||||
| Cash flow before financing activities | $ | (46.7) | $ | 15.4 | $ | (62.1) | |||||||||||
24
Net cash provided by (used for) operating activities decreased $58.8 million in the first three months of 2025 compared with the first three months of 2024, primarily as a result of lower net income and a use of cash in other liabilities primarily due to employee-related payments, including incentive compensation, in the first quarter of 2025. This was offset by changes in accounts payable, accounts receivable and inventory mainly as a result of lower inventory purchases due to lower production and sales volumes during the first three months of 2025 compared with the first three months of 2024.
The change in net cash used for investing activities during the first three months of 2025 compared with the first three months of 2024 was mainly due to higher capital expenditures in 2025.
| 2025 | 2024 | Change | |||||||||||||||
| Financing activities: | |||||||||||||||||
| Net increase (decrease) of long-term debt and revolving credit agreements | $ | 36.6 | $ | (15.7) | $ | 52.3 | |||||||||||
| Cash dividends paid | (6.2) | (5.7) | (0.5) | ||||||||||||||
| Purchase of treasury stock | (4.5) | (9.1) | 4.6 | ||||||||||||||
| Net cash provided by (used for) financing activities | $ | 25.9 | $ | (30.5) | $ | 56.4 | |||||||||||
The change in net cash provided by (used for) financing activities was primarily due to net borrowings under the Company's revolving credit facilities during the first three months of 2025 compared to net payments in the first three months of 2024. Additionally, the Company purchased less treasury stock in the first three months of 2025 related to employee-related incentive stock compensation plans compared with the first three months of 2024.
Financing Activities
The Company has a $300.0 million secured, floating-rate revolving credit facility (the "Facility") that expires in June 2026 and a $225.0 million term loan (the "Term Loan"), which matures in May 2028.
The Facility can be increased up to $400.0 million over the term of the Facility in minimum increments of $10.0 million, subject to approval by the lenders. The obligations under the Facility are generally secured by a first priority lien on working capital assets of the borrowers and guarantors in the Facility, which includes but is not limited to cash and cash equivalents, accounts receivable and inventory, and a second priority lien on the present and future shares of capital stock, fixtures and general intangibles consisting of intellectual property. The approximate book value of assets held as collateral under the Facility was $1.3 billion as of March 31, 2025.
The Facility includes restrictive covenants, which, among other things, limit additional borrowings and investments of the Company subject to certain thresholds, as provided in the Facility. The Facility limits the payment of dividends and other restricted payments the Company may make unless certain total excess availability and/or fixed charge coverage ratio thresholds, each as set forth in the Facility, are satisfied. The Facility also requires the Company to achieve a minimum fixed charge coverage ratio when total excess availability is less than the greater of 10% of the total borrowing base, as defined in the Facility, and $20.0 million. At March 31, 2025, the Company was in compliance with the covenants in the Facility.
Key terms of the Facility as of March 31, 2025 were as follows:
| FACILITY | |||||
| U.S. borrowing capacity | $ | 210.0 | |||
| Non-U.S. borrowing capacity | 90.0 | ||||
| Outstanding | 96.9 | ||||
| Availability restrictions | 6.0 | ||||
| Availability | $ | 197.1 | |||
25
| FACILITY | |||||
| Applicable margins, as defined in agreement | |||||
| U.S. base rate loans | 0.25% to 0.75% | ||||
| SOFR, EURIBOR and non-U.S. base rate loans | 1.25% to 1.75% | ||||
| SOFR adjustment, as defined in agreement | 0.10% | ||||
| Applicable margins, for amounts outstanding | |||||
| U.S. base rate loans | 0.50% | ||||
| SOFR loans | 1.50 | % | |||
| Non-U.S. base rate loans | 1.50% | ||||
| Applicable interest rate, for amounts outstanding | |||||
| U.S. base rate | 8.00% | ||||
| SOFR | 5.92% | ||||
| Facility fee, per annum on unused commitment | 0.25% | ||||
The Term Loan requires quarterly principal payments on the last day of each March, June, September and December, which commenced September 30, 2021, in an amount equal to approximately $0.6 million and the final principal repayment is due in May 2028. The Company may also be required to make mandatory prepayments, in certain circumstances, as provided in the Term Loan.
The obligations under the Term Loan are generally secured by a first priority lien on the present and future shares of capital stock, material real property, fixtures and general intangibles consisting of intellectual property and a second priority lien on U.S. working capital assets of the borrowers and guarantors of the Facility, which includes, but is not limited to, cash and cash equivalents, accounts receivable and inventory. The approximate book value of assets held as collateral under the Term Loan was $894.5 billion as of March 31, 2025.
In addition, the Term Loan includes restrictive covenants, which, among other things, limit additional borrowings and investments of the Company subject to certain thresholds, as provided in the Term Loan. The Term Loan limits the payment of dividends and other restricted payments the Company may make in any fiscal year, unless the consolidated total net leverage ratio, as defined in the Term Loan, does not exceed 2.50 to 1.00 at the time of the payment. At March 31, 2025, the Company was in compliance with the covenants in the Term Loan.
Key terms of the Term Loan as of March 31, 2025 were as follows:
| TERM LOAN | |||||
| Outstanding | $ | 216.6 | |||
| Discounts and unamortized deferred financing fees | 2.4 | ||||
| Net amount outstanding | $ | 214.2 | |||
| Applicable margins, as defined in agreement | |||||
| U.S. base rate loans | 2.50% | ||||
| SOFR | 3.50% | ||||
| SOFR adjustment, as defined in agreement | 0.11% | ||||
| SOFR floor | 0.50% | ||||
| Applicable interest rate, for amounts outstanding | 7.94% | ||||
The Company had other debt outstanding, excluding finance leases, of approximately $149.3 million at March 31, 2025. In addition to the excess availability under the Facility of $197.1 million, the Company had remaining availability of $54.4 million related to other non-U.S. revolving credit agreements at March 31, 2025.
The Company believes funds available from cash on hand, the Facility, other available lines of credit and operating cash flows will provide sufficient liquidity to meet its operating needs and commitments during the next twelve months and until the expiration of the Facility in June 2026.
26
Contractual Obligations, Contingent Liabilities and Commitments
Since December 31, 2024, there have been no significant changes in the total amount of the Company's contractual obligations or commercial commitments, or the timing of cash flows in accordance with those obligations, as reported on page 26 in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
Capital Expenditures
The following table summarizes actual and planned capital expenditures:
Three Months Ended March 31, 2025 | Planned for Remainder of 2025 | Planned 2025 Total | Actual 2024 | |||||||||||||||||||||||
| Lift truck business | $ | 8.2 | $ 27-47 | $ 35-55 | $ | 37.5 | ||||||||||||||||||||
| Bolzoni | 2.2 | 3-8 | 5-10 | 6.9 | ||||||||||||||||||||||
| Nuvera | 0.2 | — | 0.2 | 3.4 | ||||||||||||||||||||||
| $ | 10.6 | $ 30-55 | $ 40-65 | $ | 47.8 | |||||||||||||||||||||
Planned expenditures for the remainder of 2025 are primarily for improvements at manufacturing locations and manufacturing equipment, product development and improvements to information technology infrastructure. The top end of the spending range reflects spending discipline and project prioritization as a result of increased global economic uncertainty. The Company will closely monitor market conditions and may adjust investments levels and timing as market visibility improves.
The primary sources of financing for these capital expenditures are expected to be internally generated funds and bank financing.
Capital Structure
The Company's capital structure is presented below:
MARCH 31, 2025 | DECEMBER 31, 2024 | Change | |||||||||||||||
| Cash and cash equivalents | $ | 77.2 | $ | 96.6 | $ | (19.4) | |||||||||||
| Other net tangible assets | 852.0 | 750.5 | 101.5 | ||||||||||||||
| Intangible assets | 33.0 | 33.1 | (0.1) | ||||||||||||||
| Goodwill | 51.2 | 54.6 | (3.4) | ||||||||||||||
| Net assets | 1,013.4 | 934.8 | 78.6 | ||||||||||||||
| Total debt | (484.0) | (440.7) | (43.3) | ||||||||||||||
| Total temporary and permanent equity | $ | 529.4 | $ | 494.1 | $ | 35.3 | |||||||||||
| Debt to total capitalization | 48 | % | 47 | % | 1 | % | |||||||||||
OUTLOOK
Consolidated Strategic Perspective
On April 30, 2025, the Company announced a strategic realignment of its Nuvera fuel cell business designed both to increase near term profits and to create an integrated energy solutions program at its Billerica, Massachusetts facility, which will be part of the Lift Truck business. The energy solutions program will include:
•Development, manufacturing, and commercialization of its lithium-ion battery modules, battery chargers, battery management systems, and energy management services. These activities are critical to the Lift Truck's success as the business expects next generation batteries to be broadly used in electric forklift trucks.
•Development, manufacturing and commercialization of a mobile, modular and scalable hybrid electric charging platform to provide off-grid power solutions. This platform will be configured to use the Lift Truck’s battery solutions as well as a variant called HydroChargeTM that incorporates Nuvera's patented fuel cell technology.
•A significantly downsized and more limited fuel cell development program focused on the final development and testing of a higher powered 125KW fuel cell for use in the Lift Truck’s port equipment and larger HydroChargeTM applications. This more modest fuel cell program reflects the Company’s conclusion that its current fuel cell business
27
will not reach its profitability objectives in an acceptable period. The underlying analysis is based on recent fuel cells uptake rates as an energy solution, and on a significantly changed political environment in the U.S. and globally.
This strategic realignment is expected to achieve direct annualized cost reductions of $15 to $20 million starting in the second half of 2025. The Company also expects an additional $10 to $15 million of Nuvera's costs to be absorbed by the Lift Truck business, largely to staff open positions, with the goal of accelerating development of batteries and related services and mobile charging products. As result of these actions, approximately $15 to $18 million of employee severance and impairment costs are expected in Q2 2025. Additional charges or expenditures are possible as the program progresses.
This program takes advantage of Nuvera's technical skill base in each of the above initiatives. It lays the groundwork for:
•more rapid maturity, growth and profitability of its battery and charger programs;
•development, manufacturing and commercialization of its charging platforms for off grid power solutions; and
•completion of its port equipment electric power solutions.
The energy solutions program has significant technical and product synergies between fuel cells, lithium-ion batteries, chargers and mobile charge equipment in areas such as controls, packaging, cooling and manufacturing.
Battery program sales in 2025 are expected to accelerate from 2024 levels and continue growing in the following years. Initial HydroChargeTM product sales are expected to begin in the second half of 2025, while battery and fuel cell electric port equipment trucks are currently testing in customer applications. These three product activities are expected to meet Lift Truck’s end user and dealer electric product distribution needs while providing additional service revenue opportunities over time.
This strategic realignment is part of the Company’s broader change program aimed at transforming the way the world moves materials from Port to Home. It focuses on transforming the Company’s core lift truck business while building new growth opportunities in the warehouse forklift truck market, automation, energy solutions, and attachment activities through its Lift Truck and Bolzoni businesses. The Company's ongoing programs to develop modular, scalable products, optimize its manufacturing footprint, streamline its supplier structure, and expand its customer base with optimized customer solutions are key to the transformation of the core forklift truck business. With the new growth opportunities, these programs are expected to lead to significant revenue increases and enhanced operating profitability across the forklift truck market cycle while lowering capital intensity and improving historical returns on total capital employed.
The Company’s full-year 2025 outlook includes anticipated negative tariff impacts along with the Company’s proactive initiatives—including pricing programs, global product resourcing, supply chain adjustments, and cost optimization programs. This forecast has several key assumptions, including:
1.U.S. tariffs in effect on April 9, 2025, as the baseline;
2.no reinstatement of April 9, 2025 tariffs that were paused for 90 days;
3.current Section 301 tariff exemption related to lift truck parts not extended beyond May 31, 2025;
4.no additional tariffs will be added globally;
5.company demand forecasts based on bookings trends, backlog levels and market data;
6.no significant demand decline stemming from a U.S. or global economic recession or tariffs; and
7.the successful implementation of the Company’s proactive initiatives outlined above.
Despite the current challenging economic environment, the Company remains steadfast in its commitment to delivering optimal solutions and exceptional customer care and positioning the Company for substantial long-term profitable growth.
Lift Truck Business
The Company estimates that the global lift truck bookings market slightly improved in Q1 2025 compared to the prior year.
The Lift Truck business experienced a substantial increase in Q1 2025 bookings, predominately in Americas and EMEA. Bookings of $590 million increased 48% sequentially and 13% year-over-year. This improvement was driven by heightened demand for higher-priced, Class 4 and 5 products including the Company's new modular, scalable lift trucks.
These results highlight early signs of lift truck booking market recovery, especially in EMEA. The Lift Truck business remains well-positioned to capture additional market share across its product portfolio, reinforcing its long-term strategic goals. The market is expected to stabilize and improve across 2025, absent the potential effects from tariffs, which we believe caused order hesitation in April.
28
The Lift Truck business began 2025 with a backlog of $1.9 billion, which remained stable in the first quarter. Full-year production forecasts project an increasing rate compared to Q1 levels, with full-year revenues projected to slightly exceed annualized first quarter levels. While maintaining a consistent backlog, the Lift Truck business continues to balance production levels with demand for its products. Production rates are anticipated to increase in Q2 2025, followed by continued lift truck market booking growth in the second half of 2025. This is expected to position the Lift Truck business for accelerated growth in 2026. However, if the bookings market or Lift Truck's expected market share improvements fail to meet expectations, its global production levels will likely moderate in the latter half of 2025.
The Lift Truck business continues to focus on maintaining bookings with product margins at or above targeted levels through a combination of new product introductions, including modular and scalable models, and ongoing cost and pricing discipline in existing products. Product margins are expected to decline in 2025 compared to the prior year due to increased competitive market dynamics but remain above target levels. Price increases were implemented during Q1 2025 to counter inflationary costs as well as initial tariffs implemented before March 31, 2025. Lift Truck’s prices are expected to be adjusted quickly to limit the tariff impact on its cost structure. Despite these challenging conditions, market share growth opportunities are expected to further strengthen Lift Truck’s competitive positioning across its product portfolio.
Projects initiated in 2024 to streamline Lift Truck's manufacturing footprint and optimize its operations are progressing as planned. As part of the project implementation, Lift Truck anticipates incurring additional costs estimated between $8 million to $16 million in both 2025 and 2026. Initial benefits from these programs are expected in late 2025 but are expected to be offset by operational inefficiencies related to lower 2025 full-year production relative to 2024. In 2026, benefits are projected to remain modest as the programs are fully integrated. Starting in 2027, these fully developed programs should generate significant income and cash benefits ranging between $30 million to $40 million annually. These savings will significantly reduce the business’ negative impact from market cyclicality for the businesses. Savings estimates are based on current expected volume and cost assumptions.
Operating expense is expected to increase year-over-year in 2025 to support strategic long-term profitable growth initiatives. The Lift Truck business plans to expand its sales capacity and capabilities while upgrading its core information technology systems. A portion of these increased expenses are likely to be offset by leveraging lower-cost shared service capabilities and implementing more efficient processes and tools.
Operating profit is expected to moderately decline in the second quarter compared to the first quarter, despite anticipated production increases driven by strong bookings in Q1 2025. Second quarter profitability will be adversely affected by the impact of tariffs and a temporary lag in the implementation of price increases.
As a result of the above factors and consistent with our prior view, 2025 operating profit is expected to be below 2024’s exceptionally strong results.
Bolzoni
Bolzoni's second-quarter revenues are projected to modestly improve compared to the first quarter. Improved attachment sales are expected to offset reduced legacy component sales to the Lift Truck business. Second quarter operating profit is anticipated to moderately increase due to a favorable product mix.
Full year 2025 revenues are expected to decline year-over-year, reflecting weaker demand projections across its customer base. While improved product mix and ongoing cost discipline expected to provide some benefit, it is not expected to fully offset the revenue decline. As result, Bolzoni's full-year 2025 operating profit is anticipated to fall below 2024's adjusted operating profit.
Consolidated
Consistent with our prior outlook, the Company's full year 2025 revenues, production levels and profits are expected to be below robust 2024 results. Looking ahead, the Company anticipates modest sequential revenue growth in Q2 2025. However, consolidated operating profit for Q2 2025 is expected to decline moderately compared to Q1 2025, largely due to the timing of tariff-related cost increases and the actions taken to mitigate their impact. Current global trade policies and geopolitical uncertainty, among other factors, may cause the Company’s results to deviate from its current outlook.
The financial discipline established over the past several years has been designed to deliver stronger and more consistent financial results. The Company targets a 7% operating profit margin across the business cycle. During periods of strong backlog-driven production, such as those experienced in early 2024, the Company should exceed this target. However, during cyclically lower lift truck market demand phases, the Company expects to remain profitable, likely generating operating profit margins below the 7% target. Profit stability across periods of revenue cyclicality improves the Company’s financial resiliency and marks a significant improvement from prior performance.
29
The Company continues to focus on generating strong operating cash flow and accretive capital deployment. To support these goals, the Company is actively implementing initiatives to drive working capital efficiency. With the expected 2025 lift truck production decrease, there is an intense focus on realigning production and working capital processes. Key actions, including targeted inventory reductions, are underway and are expected to yield significant progress in 2025. These efforts support strong full-year cash flow from operations projections, moderately below those achieved in 2024, despite the projected lower 2025 net income.
The effective utilization of these strong cash flows is critical to the Company’s ongoing transformation. This involves substantial capital investments in advanced products, manufacturing efficiencies and information technology upgrades. For 2025, capital expenditures are now forecasted to range between $40 million and $65 million. The top end of the range is below initial expectations, reflecting spending discipline and project prioritization as a result of increased global economic uncertainty. Management will closely monitor market conditions and may adjust investments levels and timing as market visibility improves.
As the Company continues to generate cash, it remains committed to its disciplined capital allocation framework. This includes reducing leverage, executing strategic investments to support profitable growth, and delivering sustainable value and strong returns to shareholders.
Long-Term Objectives
The Company's vision is to transform the way the world moves materials from Port to Home. It strives to do this through its two customer promises: first, to provide optimal solutions for our customers, and second, to provide exceptional customer care. The Company is focused on execution of established strategic initiatives and key projects to transform the Company’s core lift truck business while building new business opportunities in the warehouse lift truck, vehicle automation, energy management and attachment business activities. These complementary growth and profit improvement projects should help the Company fulfill these two promises as well as achieve long-term revenue and operating profit growth rates above the material handling market's expected growth rates. The Company believes key projects will contribute to an increased and sustainable lift truck and attachment competitive advantage over time.
EFFECTS OF FOREIGN CURRENCY
The Company operates internationally and enters into transactions denominated in foreign currencies. As a result, the Company is subject to the variability that arises from exchange rate movements. The effects of foreign currency fluctuations on revenues, operating profit and net income (loss) are addressed in the previous discussions of operating results. See also Item 3, "Quantitative and Qualitative Disclosures About Market Risk,” in Part I of this Quarterly Report on Form 10-Q.
FORWARD-LOOKING STATEMENTS
The statements contained in this Form 10-Q that are not historical facts are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are made subject to certain risks and uncertainties, which could cause actual results to differ materially from those presented. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Among the factors that could cause plans, actions and results to differ materially from current expectations are, without limitation: (1) delays in delivery and other supply chain disruptions, or increases in costs as a result of inflation or otherwise, including materials, critical components and transportation costs and shortages, the imposition of tariffs on raw materials or sourced products, and labor, or changes in or unavailability of quality suppliers or transporters, including the impacts of the foregoing risks on the Company's liquidity, (2) impacts resulting from increased trade barriers and restrictions on international trade, including as a result of previously announced, and potentially new, changes to U.S. trade policy and tariffs as well as retaliatory tariffs imposed by other countries where the Company does business, (3) delays in manufacturing and delivery schedules, (4) reduction in demand for lift trucks, attachments and related aftermarket parts and service on a global basis, including any cyclical reduction in demand in the lift truck industry, (5) customer acceptance of pricing, (6) customer acceptance of, changes in the costs of, or delays in the development of new products, (7) the ability of the Company and its dealers, suppliers and end-users to access credit, or obtain financing at reasonable rates, or at all, as a result of interest rate volatility and current economic and market conditions, including inflation, (8) unfavorable effects of geopolitical and legislative developments on global operations, including without limitation the entry into new trade agreements and the imposition of tariffs and/or economic sanctions, including the Uyghur Forced Labor Prevention Act (the “UFLPA”) which could impact the Company's imports from China, as well as armed conflicts, including the Russia/Ukraine conflict, the Israel and Gaza conflict and/or the conflict in the Red Sea, and their regional effects, (9) exchange rate fluctuations, interest rate volatility and monetary policies and other changes in the regulatory climate in the countries in which the Company operates
30
and/or sells products, (10) the effectiveness of the cost reduction programs implemented globally, including the successful implementation of procurement and sourcing initiatives and restructuring programs, (11) the successful commercialization of products and technology related to the energy solutions program, (12) political and economic uncertainties in the countries where the Company does business, as well as the effects of any withdrawals from such countries, (13) bankruptcy of or loss of major dealers, retail customers or suppliers, (14) introduction of new products by, more favorable product pricing offered by or shorter lead times available through competitors, (15) product liability or other litigation, warranty claims or returns of products, (16) changes mandated by federal, state and other regulation, including tax, health, safety or environmental legislation, (17) the ability to attract, retain, and replace workforce and administrative employees, (18) disruptions resulting from natural disasters, public health crises, political crises or other catastrophic events, and (19) the ability to protect the Company’s information technology infrastructure against service interruptions, data corruption, cyber-based attacks or network breaches.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
See pages 30 and 31 and F-24 through F-27 of the Company's Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of the Company's derivative hedging policies and use of financial instruments. There have been no material changes in the Company's market risk exposures since December 31, 2024.
Item 4. Controls and Procedures
Evaluation of disclosure controls and procedures: An evaluation was carried out under the supervision and with the participation of the Company's management, including the principal executive officer and the principal financial officer, of the effectiveness of the Company's disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, these officers have concluded that the Company's disclosure controls and procedures were effective as of the end of the period covered by this report.
Changes in internal control over financial reporting: During the first quarter of 2025, there were no changes in the Company's internal control over financial reporting that materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
PART II
OTHER INFORMATION
Item 1 Legal Proceedings
None
Item 1A Risk Factors
The following risk factor updates the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 in the section entitled “Risk Factors.”
Changes in international trade laws and regulations or tariffs could materially reduce the Company's profitability and have a materially adverse impact on the Company’s business strategy and operations.
Free trade laws and regulations provide certain beneficial duties and tariffs for qualifying imports and exports, subject to compliance with the applicable classification and other requirements. Changes in or uncertainty surrounding laws or policies governing the terms of international trade, and in particular increased trade restrictions, tariffs or taxes on imports from countries where the Company manufactures products could have a material adverse impact on the Company's business and financial results.
Recently, the United States announced substantial new tariffs on many countries, materials and industries. Other countries have imposed and may continue to impose retaliatory tariffs and other trade restrictions impacting a broad range of raw materials and goods. In particular, tariffs and other trade restrictions between the United States and China have escalated dramatically and may continue to escalate. There exists substantial uncertainty as to whether any, or all, of these tariffs and trade restrictions will be fully implemented or sustained. The Company is monitoring these actions, which could disrupt our supply chains, increase our costs, and have an adverse impact on the Company's business strategy, market share and operating results. There can be no assurances that these tariffs will not be implemented or increased in the future or that further subsequent tariffs will not be announced. The degree to which these tariffs, any future tariffs, or changes in U.S. and foreign trade policies affect the Company's operating results will be influenced by the specific details of the changes in trade policies, their timing and duration, and the Company's effectiveness in deploying tools and strategies to address these issues. Any actions the Company takes to adapt to new tariffs or other trade restrictions may cause the Company to modify operations and business strategy. Although
31
such actions would be designed to mitigate the impact of tariffs and other trade restrictions, there can be no assurance that such actions will be successful and any such action could be time-consuming and expensive, impact pricing of the Company’s products, which could impact sales and profitability, or cause the Company to forgo business opportunities.
The continuation, increase or expansion of international tariffs and other trade restrictions, as well as continued or increased geopolitical tensions, volatility and uncertainty with respect to trade and other policies both directly and through their impacts on business and customer sentiment and spending, currency exchange and interest rates, inflation, and economic conditions globally, could have a material adverse impact on our revenue, operations, financial position, including cash flows, cost structure, competitiveness, supply chain logistics, product demand and pricing, and profitability, and may increase the likelihood, or amplify the impacts, of other risks, including those highlighted in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2024.
There have been no other material changes from the risk factors previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 in the section entitled “Risk Factors.”
Item 2 Unregistered Sales of Equity Securities and Use of Proceeds
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
| Issuer Purchases of Equity Securities | ||||||||||||||
| Period | (a) Total Number of Shares Purchased | (b) Average Price Paid per Share (1) | (c) Total Number of Shares Purchased as Part of the Publicly Announced Program | (d) Maximum Number of Shares (or Approximate Dollar Value) that May Yet Be Purchased Under the Program (2) | ||||||||||
| Month #1 (January 1, 2025 - January 31, 2025) | 17,085 | $ | 49.80 | 106,314 | $ | 44,239,122 | ||||||||
| Month #2 (February 1, 2025 - February 28, 2025) | — | $ | — | 106,314 | $ | 44,239,122 | ||||||||
| Month #3 (March 1, 2025 - March 31, 2025) | — | $ | — | 106,314 | $ | 44,239,122 | ||||||||
| Total | 17,085 | $ | 49.80 | 106,314 | $ | 44,239,122 | ||||||||
(1) Average price paid per share excludes commissions.
(2) On November 18, 2024, the Company’s Board of Directors announced the approval of a stock repurchase program, pursuant to which the Company may repurchase up to $50 million or 1.5 million shares, whichever comes first, of the Company’s Class A common stock. The stock repurchase program may be modified, suspended, extended or terminated by the Company at any time without prior notice and will expire no later than November 2027.
Item 3 Defaults Upon Senior Securities
None
Item 4 Mine Safety Disclosures
Not applicable
Item 5 Other Information
None of the Company’s directors or officers (as defined in Rule 16a-1(f) promulgated under the Securities Exchange Act of 1934) adopted terminated
32
Item 6 Exhibits
The following exhibits are filed as part of this report:
| Exhibit | ||||||||
| Number* | Description of Exhibits | |||||||
| 10.1** | ||||||||
| 31(i)(1) | ||||||||
| 31(i)(2) | ||||||||
| 32 | ||||||||
| 101.INS | Inline XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
| 101.SCH | Inline XBRL Taxonomy Extension Schema Document | |||||||
| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||
| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||
| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||
| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||
| 104 | The cover page from this Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, formatted in Inline XBRL and contained in Exhibit 101 | |||||||
| * Numbered in accordance with Item 601 of Regulation S-K. | ||||||||
| ** Management contract or compensation plan or arrangement required to be filed as an exhibit pursuant to Item 6 of this Quarterly | ||||||||
| Report on Form 10-Q. | ||||||||
33
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| Hyster-Yale, Inc. | |||||||||||
| Date: | May 6, 2025 | /s/ Dena R. McKee | |||||||||
| Dena R. McKee | |||||||||||
| Vice President, Controller and Chief Accounting Officer (principal accounting officer) | |||||||||||
34