Executive Summary

Q4 2024 delivered solid execution: revenue $597.9M and adjusted EBITDA $49.6M, with Specialty Vehicles margin at 11.4% while RV remained pressured; GAAP EPS surged to $0.80 on a $28.9M gain from the ENC sale; adjusted EPS was $0.51 .
FY25 outlook implies a step-function earnings ramp: net sales $2.3–$2.4B, adjusted EBITDA $190–$220M (about +48% at the midpoint vs pro forma FY24, per mgmt), adjusted net income $116–$140M, FCF $90–$110M .
Capital returns accelerated: new $250M share repurchase authorization (24-month term) replaces the prior $175M program; quarterly dividend raised 20% to $0.06 (annualized $0.24) .
Stock reaction catalysts: credibility around Specialty Vehicles’ double‑digit margins and throughput normalization, plus FY25 earnings ramp and capital returns; offset by cyclical RV softness and terminal truck trough commentary .

What Went Well and What Went Wrong

What Went Well
- Specialty Vehicles margin expansion: segment adjusted EBITDA rose to $50.2M with 11.4% margin; excluding Collins divestiture, adjusted EBITDA +67.9% YoY on price realization and mix in fire/ambulance .
- Backlog strength and visibility: Specialty Vehicles backlog ended Q4 at $4.18B; ex-Collins/ENC, backlog rose $490.9M YoY, supporting 2–3 years of fire/ambulance visibility at current production rates .
- Management execution and tone: “Significant margin improvement in the Specialty Vehicles segment, as well as excellent cost discipline, more than offset… cyclical businesses,” said CEO Mark Skonieczny, highlighting operational excellence and portfolio simplification .
What Went Wrong
- RV demand and discounting: RV net sales fell 26.5% YoY to $158.1M on lower unit shipments and increased discounting; segment adjusted EBITDA fell 57.6% to $8.1M .
- Cyclical businesses remained headwinds: management flagged terminal trucks at a trough into 1H FY25; ENC bus exit created difficult YoY comparisons (now completed and sold) .
- Mix/seasonality caution into Q1: Mgmt guided a >20% sequential revenue decline from Q4 to Q1 on fire apparatus mix timing and ~25% decremental margin QoQ in Q1 .

Financial Results

Consolidated performance vs prior year and prior quarters

Metric	Q4 2023	Q2 2024	Q3 2024	Q4 2024
Revenue ($M)	$693.3	$616.9	$579.4	$597.9
Gross Profit ($M)	$95.5	$77.3	$78.3	$78.8
Gross Margin (%)	13.8% (calc)	12.5% (calc)	13.5% (calc)	13.2% (calc)
Net Income ($M)	$29.7	$15.2	$18.0	$41.7
Diluted EPS ($)	$0.50	$0.28	$0.35	$0.80
Adjusted EBITDA ($M)	$54.0	$37.5	$45.2	$49.6
Adjusted EBITDA Margin (%)	7.8%	6.1%	7.8%	8.3%
Adjusted Diluted EPS ($)	$0.53	$0.39	$0.48	$0.51

Notes: Q4 2024 GAAP included a $28.9M gain on sale of business; adjusted metrics exclude non-core items per company reconciliation .

Segment performance (sales and profitability)

Segment	Q2 2024 Net Sales ($M)	Q3 2024 Net Sales ($M)	Q4 2024 Net Sales ($M)	Q2 2024 Adj. EBITDA ($M)	Q3 2024 Adj. EBITDA ($M)	Q4 2024 Adj. EBITDA ($M)
Specialty Vehicles	$437.4	$432.1	$439.9	$33.8	$44.3	$50.2
Recreational Vehicles	$179.7	$147.4	$158.1	$12.1	$9.4	$8.1
Corporate & Other	($0.2)	($0.1)	($0.1)	($8.4)	($8.5)	($8.7)
Total	$616.9	$579.4	$597.9	$37.5	$45.2	$49.6

Additional segment margins: Specialty Vehicles adjusted EBITDA margin 11.4% in Q4; RV 5.1%; total 8.3% .

KPIs and balance sheet

KPI	Q2 2024	Q3 2024	Q4 2024
Specialty Vehicles Backlog ($M)	$4,064.4	$4,114.4	$4,179.8
RV Backlog ($M)	$274.7	$240.3	$291.5
Total Backlog ($M)	$4,339.1	$4,354.7	$4,471.3
Cash and Equivalents ($M)	$38.2	$50.5	$24.6
Net Debt ($M)	$181.8	$164.5	$60.4
ABL Availability ($M)	$280.3	$261.8	$349.6
Capex ($M)	$5.9 (Q2)	$5.9 (Q3)	$5.3 (Q4)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Sales	FY 2025	N/A	$2.3B – $2.4B	New
Net Income	FY 2025	N/A	$98M – $125M	New
Adjusted EBITDA	FY 2025	N/A	$190M – $220M	New
Adjusted Net Income	FY 2025	N/A	$116M – $140M	New
Free Cash Flow	FY 2025	N/A	$90M – $110M	New
Dividend/Share	Ongoing	$0.05 quarterly	$0.06 quarterly (+20%)	Raised
Share Repurchase Auth.	24 months	$175M program (terminated)	$250M new authorization	Increased/Reset

Company also set intermediate targets to FY27 (10–12% consolidated adj. EBITDA margin; >$350M cumulative FCF; ROIC >15%) during Investor Day remarks on the call .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 2024, Q3 2024)	Current Period (Q4 2024)	Trend
Specialty Vehicles throughput & margins	F&E margins improved; double‑digit exit targeted; Ocala record shipments; Spartan centers of excellence; sequential margin expansion expected	Specialty Vehicles adj. margin 11.4%; double‑digit expected to continue in FY25; Q1 seasonality to impact sequentially	Improving
Backlog and price realization	F&E unit book-to-bill ~1x; revenue B/B 1.6x; price realization from 2022–23 still flowing through	Specialty backlog $4.18B; 2–3 years visibility; management emphasizes sustainable margin uplift from price/cost and OpEx	Stable/Supportive
RV market and discounting	RV demand soft; dealer reluctance to restock; discounting heavier; aiming 7–7.5% FY margin	RV sales -26.5% YoY; discounting persists; book-to-bill 1.3x in Q4; H2 FY25 improvement hoped post shows	Cautious
Terminal trucks	Down ~59% YoY in Q2; headwind to FY24	At trough into 1H FY25; mid‑single-digit margin target longer-term	Bottoming
Capital allocation	Special dividend $3, buybacks; updating framework later in year	$250M new buyback; dividend +20%; >$350M FCF targeted over 3 yrs	More shareholder returns
Supply chain/tariffs	Multi‑sourcing, improving resilience	<2% of Tier-1 commodities outside U.S.; inflation/supply disruption remain risks	Resilient, watch risks
Portfolio simplification	Collins divestiture completed in Q1; ENC wind‑down ahead of schedule; RTC sold	ENC sale closed for ~$52M (Oct 18) ; reinforces focus and margin	Completed bus exit

Management Commentary

Strategic focus: “Significant margin improvement in the Specialty Vehicles segment, as well as excellent cost discipline, more than offset the end market demand challenges in our cyclical businesses,” highlighting operational excellence and portfolio simplification .
FY25 cadence and seasonality: “Expect greater‑than‑usual seasonality in the first quarter… ~20% decline in revenue vs Q4… sequential decremental margin of ~25%” due to mix .
Capital returns and confidence: “REV Group’s ability to deliver… and significant free cash flow… while enhancing shareholder value through an increased dividend and a new share repurchase authorization” (CFO) .
Long-term targets: Consolidated adj. EBITDA margin 10–12% by FY27; cumulative FCF >$350M over three years; ROIC >15% .

Notable quotes:

“Our record high $4.2 billion specialty vehicles backlog provides a rare level of demand certainty and production planning visibility” (CEO) .
“We believe fourth quarter margin performance provides a strong indication of the segment’s potential for double‑digit margins… in fiscal 2025” (CFO) .

Q&A Highlights

RV outlook and orders: Dealers remain hesitant; Tampa show is key; mgmt expects any improvement in RV to be a 2H FY25 story .
Terminal trucks trough: Business at a cyclical trough into 1H FY25; longer-term mid‑single-digit EBITDA margins targeted .
Free cash flow conversion: Target ~50% EBITDA-to-FCF conversion over planning period; working capital mix shifts (customer advances down) temper conversion .
Tariff/supply chain risk: <2% of Tier‑1 commodities outside U.S.; multi‑sourcing over 100 key components increases resilience; inflation and disruptions remain risks .
M&A optionality: Preference for tangential specialty vehicle acquisitions where REV’s simplification/lean playbook yields synergies; not pursuing “broken” assets .
Buyback deployment: Flexible, opportunistic within $250M authorization; balanced with other capital priorities .

Estimates Context

Wall Street consensus (S&P Global) was unavailable at the time of analysis due to provider rate limits, so we cannot quantify beats/misses vs consensus for Q4 or FY25. We will update comparisons once S&P Global estimates can be retrieved.

Key Takeaways for Investors

Specialty Vehicles is the engine: double‑digit margins achieved with a robust 2–3 year fire/ambulance backlog and continued price/mix benefits; expect this to underpin FY25 guidance execution .
Near-term seasonality: Expect Q1 FY25 revenue down ~20% sequentially and ~25% decremental margins QoQ; then sequential improvement through the year .
RV remains cyclical headwind: Weak retail and discounting persist despite improving dealer inventory; mgmt frames recovery as a back‑half FY25 setup contingent on show season .
Capital returns are material: $250M buyback and 20% dividend hike signal confidence and provide downside support; monitor pace of repurchases .
Mix-shift and portfolio simplification strengthen quality of earnings: Bus exits (Collins/ENC) and

REV Group, Inc. (REVG)·Q4 2024 Earnings Summary