Alta Equipment Group Q2 2025 Earnings Call Transcript

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Provided by Quartr
August 7, 2025

Key Takeaways

  • Positive Sentiment: Construction segment delivered a 15% year-over-year increase in new and used equipment sales (up $22 M) and entered H2 with a strong sales backlog and ample product support staffing.
  • Neutral Sentiment: Material Handling revenues were modestly up quarter-over-quarter due to higher used and Allied product volumes, but new equipment sales declined $8.3 M year-over-year amid cautious spending.
  • Neutral Sentiment: Master Distribution revenues grew 25% to $20.9 M, though gross margins were pressured by US-EU tariffs, prompting pricing adjustments and OEM risk-sharing measures.
  • Positive Sentiment: Expense and inventory optimization cut SG&A by over $20 M year-to-date, and the company repurchased ~1.2 M shares at an average $5.64 under its $30 M buyback program.
  • Negative Sentiment: The top end of 2025 adjusted EBITDA guidance was trimmed to $181.5 M due to tariff impacts in ECOVERSE and ongoing product support headwinds, offset by new free cash flow guidance of $105 M–$115 M.
AI Generated. May Contain Errors.
Earnings Conference Call
Alta Equipment Group Q2 2025
00:00 / 00:00

There are 7 speakers on the call.

Operator

Hello, everyone, and thank you very much for your patience. Today's call will begin shortly. Good afternoon, and thank you for attending the Ultra Equipment Group Second Quarter twenty twenty five Earnings Conference Call. My name is Lydia, and I'll be your moderator for today's call. I'll now turn the call over to Jason Dammire, Director of SEC Reporting and Technical Accounting with Alta Equipment Group.

Speaker 1

Thank you, Lydia. Good afternoon, everyone, and thank you for joining us today. A press release detailing Alta's second quarter twenty twenty five financial results was issued this afternoon and is posted on our website along with a presentation designed to assist you in understanding the company's results. On the call with me today are Ryan Greenewalt, our Chairman and CEO and Tony Kaluchi, our Chief Financial Officer. For today's call, management will first provide a review of our second quarter twenty twenty five financial results.

Speaker 1

We will begin with some prepared remarks before we open the call for your questions. Please proceed to Slide two. Before we get started, I'd like to remind everyone that this conference call may contain certain forward looking statements, including statements about future financial results, our business strategy and financial outlook, achievements of the company and other non historical statements as described in our press release. These forward looking statements are subject to both known and unknown risks, uncertainties and assumptions, including those related to Altus' growth, market opportunities and general economic and business conditions. We have based these forward looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations.

Speaker 1

Although we believe these expectations are reasonable, we undertake no obligation to revise any statement to reflect changes that occur after this call. Descriptions of these and other risks that could cause actual results to differ materially from these forward looking statements are discussed in our reports filed with the SEC, including our press release that was issued today. During this call, we may present both GAAP and non GAAP financial measures. A reconciliation of GAAP to non GAAP measures is included in today's press release and can be found on our website at investors.altequipment.com. I will now turn the call over to Ryan.

Speaker 2

Thank you, Jason. Good afternoon, everyone, and thank you for joining us to review Alta Equipment Group's results for the 2025. I'll begin with a high level overview of our performance, discuss key trends across our business segments and share our outlook for the remainder of the year. Then I'll turn it over to Tony to walk through our financials in more detail. Amid persistent uncertainty around interest rates and broader macro sentiment also delivered a strong second quarter underscoring the resilience of our diversified model and the advantage created by disciplined operational execution even as pockets of the market remain volatile.

Speaker 2

Our Construction Equipment segment once again demonstrated its strength driven by robust demand for heavy earthmoving machines particularly in federal and state DOT infrastructure projects. New unused equipment sales increased by $21,500,000 supported by strong demand in many key markets and improving customer sentiment. Our Midwest and Canadian operations, particularly in aggregate and mining markets through Alt And Midwest Mine, continue to outperform last year, reflecting strong momentum in those sectors. In Florida, the overall market remains resilient, particularly in infrastructure, though we've seen temporary pauses in select private nonresidential projects due to a combination of contractor labor constraints and permit timing delays. While construction rental revenue was down from prior year, this was primarily due to our strategic initiative to right size our rental fleet and the divestiture of aerial fleet assets in Chicago land during the quarter, resulting in a segment fleet size nearly $60,000,000 below the prior year period.

Speaker 2

We entered the second half of the year with a strong sales backlog, sufficient product support staffing and accelerated customer interest in both large infrastructure and compact equipment projects. Our Material Handling segment faced some headwinds this quarter, particularly in Michigan and Illinois where spending among automotive and general manufacturing customers remained cautious. That said, Alta's performance was notably resilient. Materials Handling revenues were modestly up quarter over quarter driven by a favorable shift in sales mix, specifically increased volumes in used equipment and Allied Products. Our Allied product lines in the Material Handling segment refer to specialty equipment offerings that serve niche applications, typically commanding higher margins than core new lift truck sales due to their specificity, technical requirements and limited competitive alternatives.

Speaker 2

While Hyster Yale reported sober softer bookings industry wide, we're seeing a different trend within our business. Bookings momentum across new used and allied categories has remained strong year to date with encouraging activity in multiple regions and sectors and allied product lines comprising nearly 50% of our new equipment sales year to date. While product support and fleet utilization were modestly down, most regions maintained steady backlogs and our internal July bookings showed positive signs particularly in margin accretive categories. Turning to our Master Distribution segment. We are pleased with the continued improvement of the business with total revenues increasing 25% to $20,900,000 Our sales team has been focused on driving stronger dealer engagement and expanding channel activity, including strategic and brand expansion across our dealer network.

Speaker 2

That said, the segment continues to face volatility tied to global trade policies and exchange rates between The U. S. And EU. We're actively managing those risks and remain focused on margin preservation and inventory velocity. Looking more holistically across all segments, our expense and inventory optimization initiatives continue to deliver results with SG and A down over $20,000,000 year to date.

Speaker 2

We also continue to execute on our capital allocation strategy. During the quarter, we repurchased nearly 1,200,000.0 shares at an average price of $5.64 per share under our $30,000,000 buyback program, which has $17,700,000 in remaining availability. Looking ahead, our outlook for the balance of the year remains encouraging, especially if we see a definitive conclusion on trade policies and a downward trend in interest rates. Our customers are optimistic about the benefits of the tax incentives contained within the One Big Beautiful Bill, which could positively impact demand for new equipment across our business lines later this year. The resiliency of our business model and the diversity of our end markets continue to provide stability through down cycles and a distinct competitive advantage in the market.

Speaker 2

I want to express my sincere thanks for the entire Ulta team for their hard work and dedication to the continued success of our business. With that, I'll now turn the call over to Tony, who will walk through our financials in more detail.

Speaker 3

Thank you, Ryan. Good evening, everyone, and thank you for your interest in Ulta Equipment Group and our second quarter twenty twenty five financial results. Before getting into the quarter, I want to begin by recognizing our employees, customers and partners for their continued efforts and support in Q2. Our performance is a reflection of our employees and our partners who have exhibited strength and resiliency amidst the dynamic macro environment. My remarks today will focus on three key areas.

Speaker 3

First, I'll present our second quarter financial results, which reflect the seasonal uplift we have come to expect, especially in our Construction segment in our Northern regions. As part of that discussion, I will give a brief financial overview of the quarter for each of our three segments, with a deeper dive into our Construction segment's performance in the quarter and how its earnings quality has improved year over year. Lastly, I'll touch on the balance sheet and cash flows for the quarter. Second, I'll discuss our expectations for the remainder of the year and introduce a new annual guidance measure, free cash flow before rent to sell decisioning, which will provide investors with a better understanding of the company's view on cash flow expectations for the year. I'll also briefly discuss the slight adjustment we are making to the top end of our adjusted EBITDA guidance range for fiscal year twenty twenty five.

Speaker 3

Lastly, I'll comment on the progress we've made on our rebalanced capital allocation strategy, which was updated at the end of Q1. Throughout my remarks, I'll be referencing information presented on Slides nine through 19 in our earnings deck. I encourage everyone to follow along with the presentation and review our 10 Q, both available on our Investor Relations website at altg.com. First, for the quarter, the company recorded revenue of $481,200,000 a slight reduction of 1.4% versus last year, but up a meaningful $58,200,000 sequentially over Q1. Revenues in the quarter were underpinned by solid performance in our Construction and Master Distribution segments, which together sold $24,700,000 more new and used equipment year over year, a 15.4% increase.

Speaker 3

The new and used equipment sales growth in our Construction and Master Distribution segments was offset partially by $8,300,000 reduction in new and used equipment sales in our Material Handling segment. Next, in our parts and service or product support departments, revenue was down 2.6% when compared to last year, but up slightly on a sequential basis. Important to note that some of this product support revenue decline is strategic as we continue to optimize our product support business, specifically in our construction segment to drive our labor gross margins higher and reduce SG and A spend. Lastly, rental revenues are down 7,400,000 year over year, largely related to our strategic decision to reduce the size of our rent to sell fleet as we focus on better utilization and ultimately enhance returns on our investment in rental fleet. Now focusing on the segments for the quarter.

Speaker 3

First, in our Construction segment as highlighted on slide 11. As mentioned, new and used equipment sales outperformed 2024 by nearly $22,000,000 a 15% increase year over year. We saw strong demand in our northern regions and continue to benefit from our customers' relationships in the resilient infrastructure and aggregate and mining end markets. However, from a new and used equipment gross profit perspective, we continue to run below historic levels and our expectations as industry oversupply continues to be a theme. On to Product Support, where while we saw modest gains in revenue year over year, we continue to outperform on our profitability metrics, specifically in our Service department as we saw gross margins gain two ninety basis points year over year, a salute to our operations team's commitment and focus on efficiency gains in 2025.

Speaker 3

Further to that point, I wanted to highlight our Construction segment's performance and how our team has been able to improve the business year over year. To provide a visual, I would point investors to slide 13 in our investor presentation. As you will note, while the segment's standalone EBITDA is relatively flat versus last year at $50,000,000 the makeup of the $50,000,000 is different. Specifically, while twenty twenty four's EBITDA was more heavily weighted to opportunistic rental equipment sales and related gains, twenty twenty five's EBITDA has been more heavily weighted to perpetual profitability gains in the form of increased gross margins as well as reduced SG and A load. This realignment from less consistent equipment sales to more reliable recurring product support profitability creates a more resilient business and provides for increased operating leverage for when equipment sales and gross margins return to previous levels.

Speaker 3

We are proud of the progress we've made to date in our Construction segment and look forward to continuing the effort going forward. On to Material Handling. As previously mentioned and included on slide 11, new and used equipment sales in our Material Handling segment were down $8,300,000 year over year, but notably the line was up on a sequential basis. A couple of items of note here. One, we believe that the Material Handling customer base as opposed to the Construction customer base has been more affected by the trade policy uncertainties, especially some of our larger customers with greater importexport exposure as they decision long term capital commitments.

Speaker 3

Two, we still have yet to see any major cancellations in our lift truck sales pipeline. And three, as Ryan mentioned, our year to date lift truck bookings when combining new Hyster Yale used equipment and Allied equipment are modestly up year over year and we also saw strong bookings in the month of July, which provides a level of confidence heading into the second half. In terms of product support revenues in Material Handling, while we continue to run behind last year's pace in parts and service, most predominantly in our Midwest and Canadian geographies, we believe we have found a bottom in these departments and that our product support activity will stabilize throughout the remainder of the year. Lastly, from a segment perspective, Master Distribution, which houses our ECOVERSE business. The story for the quarter here is simple and it's tariff related.

Speaker 3

While ECOVERSE has seen stronger demand from stocking dealers and its waste management end markets year over year, the impact of tariffs on gross margins in the quarter was acute. Ultimately, a more stable trade environment between The United States and the European Union will enhance predictability for our business and our customers. But in the meantime, we've taken mitigating measures in terms of pricing actions and OEM risk sharing to best maneuver through this situation and are cautiously optimistic that the mitigation efforts will take hold through the second half of the year. In summary for the quarter, efficiency gains in our service department and expense reductions led the way to $48,500,000 of adjusted EBITDA. Lastly and notably, as we focus on driving ROIC, the company was able to realize nearly the same level of EBITDA year over year on a leaner balance sheet as the gross book value of our rental fleet is down nearly $50,000,000 In terms of cash flows and in referencing slide 15, for the quarter, free cash flow before rent to sell decisioning was approximately $32,000,000 and stands at $55,000,000 year to date.

Speaker 3

More on our expectation for fiscal year twenty twenty five on this metric momentarily. To quickly check-in on the balance sheet as of sixthirty and as depicted on slide 16, we ended the quarter with approximately $280,000,000 of cash and availability on our revolving line of credit facility, plenty of capacity and term to navigate any business climate that lies ahead. Moving on to the second portion of my prepared remarks, 2025 adjusted EBITDA guidance and introduction to free cash flow before rent to sell decisioning guidance for 2025. First, cash flow before rent to sell decision, which again is presented on Slide 15. In terms of the metric itself, free cash flow before rent to sell is a metric that we believe appropriately measures the true cash flow generation capacity of the business in a steady state and removes the impact of the decisions that we make with our rent to sell fleet, which like inventory and as observed over our recent history can ebb and flow materially as we navigate and match OEM supply chains with customer demand and customer preference to either rent or buy.

Speaker 3

In summary, we expect free cash flow before rent to sell decisioning to be between $105,000,000 and $115,000,000 for the fiscal year 2025. In terms of the reduction of the top end of our adjusted EBITDA guidance for the year, we now expect to report $171,500,000 to $181,500,000 of adjusted EBITDA for 2025. The trimming of the top end of the guidance is primarily related to one, the impact of tariffs on our ECOVERSE business in Q2 and the risk associated with regaining margins over the back half of twenty twenty five and two, we expect to continue drag in our product support and rental departments in our material handling segment, specifically in the Midwest and in Canada. In terms of the factors that we believe will continue to have a positive impact on our business in the second half. First, stability in infrastructure based end markets will continue to act as an insulator against macro volatility in our construction segment.

Speaker 3

Second, we expect to continue accretion quarter over quarter from our product support gross margin performance, specifically in our service department, driven by a continued focus on technician efficiency. Additionally, we expect a continuation of the outperformance that we saw throughout the first half on the SG and A line on a comparative basis as we head throughout the remainder of the year. Third, while Material Handling Equipment revenues were off year over year, we have conviction in the history and resiliency of the industry's booking cycle and in specific end markets like food and beverage and general human sustenance categories. Additionally, our ability to drive revenue in Allied product categories that sit alongside our high cereal offerings and our strong July bookings give us confidence headed into the second half. Finally, we expect the recently enacted One Beautiful Bill Big Beautiful Bill to serve as a tailwind for equipment demand.

Speaker 3

Reinstatement The of 100% bonus depreciation and expanded Section 179 expensing limits have generated year end demand for us in the past as customers look to capture these upfront tax benefits when purchasing heavy equipment. For the last portion of moving on to the last portion of my prepared remarks, a quick update on the renewed capital allocation strategy that was announced alongside our Q1 earnings. As a reminder, the Board authorized a $10,000,000 upsizing of the company's buyback program to $30,000,000 and the allocation of $10,000,000 into a 10b5-one plan, all of which was effective after our Q1 earnings call. I'm pleased to report the company is able to deploy the repurchase to deploy capital to repurchase over 1,100,000.0 shares or approximately 3.4% of the shares outstanding in the quarter. We remain committed to taking advantage of any disconnections in the marketplace with our buyback program should further opportunities present themselves.

Speaker 3

In closing, I want to thank my Alta teammates for all their efforts during the 2025 and look forward to a strong back half of the year. I wish you all the best and look forward to updating investors on our Q3 performance in November. Thank you for your time and I will turn it back over to the operator for Q and A.

Operator

Thank you. Our first question comes from Stephen Ramsey with Thompson Research Group. Please go ahead. Your line is open.

Speaker 4

Hi, good evening, everyone. Maybe to start with one of the topics at the end, big beautiful bill potentially benefiting demand. I guess, first, would you expect that to impact one segment more than another? Secondly, is any of this embedded in the guidance or towards the high end? Or do you think the benefits of this may flow in 2026?

Speaker 3

Thanks for the question, Steve. This is Tony. I'll take that one. You know, we we throughout my history here, which is, you know, more than ten years, whenever we have some stability or regulatory changes that impact a fiscal tax year, which which in this case is 02/2025, not '26. We usually see the impact right at the tail end of the year, and I'm talking November and December, primarily as companies start to look at their tax situation on a fiscal year basis and decide whether to take advantage of bonus depreciation section one seventy nine, etcetera.

Speaker 3

It all it also happens to be kind of the end of the year in the northern regions in our construction business when customers are sitting down with their CPA. So definitely q four weighted typically when it does have an impact. In terms of impact one way or the other, I guess I would slightly lean toward construction in terms of, you know, where it might be most impactful. But we've seen it historically impact q four in the material handling business as well. So not a 2026 issue.

Speaker 3

I think if anything, you know, really late here in '25. In terms of the guidance, I think it would, any accretion would help us get to the top end of our range, that we've provided, here today.

Speaker 4

Okay. That's helpful color. And then on material handling, you've cited hesitancy among your customer base, but still relatively resilient. But then July bookings were strong. Does that tell you that the hesitancy may be subsiding?

Speaker 4

Or how do you interpret if there is any change of trend or outlook from your customer base there?

Speaker 2

Steven, this is Ryan. I I can take that one.

Speaker 1

You know, the the the bookings tend

Speaker 2

to be volatile. These are fleets that are up for replenishment. So, you know, what we're seeing, I think, is a regional, weak sentiment, in particular, related to the the pockets of our geography that have exposure to auto manufacturing. But that said, fleets that are coming due are being replenished. That and that's what we're seeing in our businesses.

Speaker 2

When when a a fleet is up for replenishment, they're not kicking the can. They're they're they're signing up for a new fleet.

Speaker 4

Okay. That's great. And wanted to highlight, as you guys did, a good story on G and A discipline. Looks like it was strong in both segments. Maybe to confirm how you expect that to play out in the second half?

Speaker 4

And then is there room for more benefits in 2026?

Speaker 3

Sure, Steve. I think I think probably we recall that, right, it's SG and A, so selling expenses. And, we we would love to have more selling expenses, right, in the back half of the year. The the the and, specifically, I'm thinking, you know, commissions on the sale of equipment. Right?

Speaker 3

So we we'd always wanna have more of those. We're happy to pay commissions when the team sells more equipment. But from a fixed cost perspective, I would say, we wouldn't expect much more in the in the back half than what we've seen here throughout the first half in terms of just the nominal level. We think we've gotten to a good level. We've had some we've had some, just efficiencies that maybe outpaced expectations, related to to to insurance, this year so far.

Speaker 3

And we're self insured on a lot of things. And so that can be, you know, a little bit of, you know, feast or famine in in certain quarters. But I think that the way to answer it is we've we've kinda found a bottom, we think, on the fixed cost for the year. We'll continue to kinda found a way, but we were really pleased with q two, and we we hope to kind of at least hold that level from a fixed cost perspective. Again, we'd love to pay more more sales variable expenses throughout the rest of the year because that just benefits everybody.

Speaker 3

But hopefully, that that helps, Steve.

Speaker 4

For sure. It does. Okay. Last one for me on the construction equipment and maybe to tie together the demand side as well as potential boost of purchasing of equipment for the big beautiful bill. Do you get a sense from customers that if construction activity stays where it is, if it doesn't recover, meaningfully in the second half, that your customer base contractors would still be willing to purchase equipment given the tax benefits of doing so?

Speaker 4

Or do you think they are factoring in higher interest rates and demand that maybe isn't coming off the bottom or an outlook for backlogs leading activity in early twenty six that maybe would keep them from taking advantage of the bill?

Speaker 3

Know, Steve, I it it's it's hard to say, but I'll give you take a shot at it. I think the best the the number one thing that gets our customers to commit to access, equipment on the construction side is the belief in their backlog, and and that is remains strong in terms of just sentiment. Then thereafter, I think all of the other factors start to play in, interest rates, tax, you know, where they're at tax wise for the year, big beautiful bill, etcetera. So I I still believe that backlog and confidence is what will will will carry the day in terms of customers wanting to buy at year end. If if all things are equal, though, and they they feel good about or at least halfway decent about their backlog, I don't know why they wouldn't take advantage of of the bonus depreciation and and commit to asset.

Speaker 3

So, for us, I think it's more confidence in backlog than just starting with taxes, if that helps.

Speaker 4

That does. Thanks, Tony.

Speaker 3

Thanks, Steve.

Operator

Thank you. Our next question comes from Liam Burke with B. Riley Securities. Please go ahead.

Speaker 5

Hi. Good afternoon, Ryan. Good afternoon, Tony.

Speaker 3

Hi, Liam. Hey, Liam.

Speaker 5

Ryan, on the construction business geographically, you talked about Florida being strong now. How about the other geographies that your distributors are serving?

Speaker 2

The way I'd answer that is the the geographies that are more manufacturing oriented ours we're still seeing that same sort of weakness in those markets. So even though we're talking about construction, those markets sentiment in the industrial markets tends to be softer than, let's say, Florida.

Speaker 3

Just a quick soft bullet to that, Liam. We we've we've mentioned our northern regions had a, you know, good first half. Some of that is us taking share, despite maybe just softness in the marketplace. And just to clarify Ryan's comments on on Florida, same same kind of story. Florida market, we've seen a few delays, in projects, just fits and starts on on permitting or, you know, potential labor issues, you know, on a project.

Speaker 3

But we're still bullish. There's there's tons of money, you know, flooding in from the DOT down in Florida. And and we've like I said, we've we've, had some share gains there as well.

Speaker 5

Great. And on the M and A front, do you see opportunities backing up now that the market's firming up and the people out there are looking for help?

Speaker 2

Liam, this is Ryan. I can take that one. You know, on the m and a front, our our story is pretty consistent that, you know, weak a weak economic cycle can break some things loose. But for the most part, these are generational assets, and it's more about finding assets that there's a succession planning issue or, you know, something like that that's the catalyst versus the economic cycle. And and our our theme in terms of the demographic theme and the the backdrop for M and A with the OEMs is still very solid.

Speaker 2

We see lots of opportunities across the segments.

Speaker 5

Great. Thank you, Ryan. Thank you, Tony.

Speaker 3

Thanks, Liam.

Operator

Thank you. And our next question comes from Steve Hansen with Raymond James. Please go ahead.

Speaker 6

Yes. Good evening, guys. Thanks for the time. I just wanted to focus on the margin profile for Amit. You provided some good commentary in your opening remarks.

Speaker 6

Just can you maybe speak to that competitive environment and whether you feel like it's starting to saturate or whether we're starting to get some sort of floor or some sort of support in the margin profile? And I'll start with the Construction equipment first on the on the new side. Are are you seeing any evidence that margins are starting to stabilize?

Speaker 3

Yeah. I think that I I think, generally, Steve, stabilization is a is a good term. It it especially in the heavy equipment categories, the heavier categories. One of the things that we noticed in q two and really even in q one is that compact equipment, has been a little bit more challenged in terms of in terms of gross margin. I think that ties back to some of the private nonres, maybe pressure, so, like, smaller projects, etcetera.

Speaker 3

So, and then you've you know, in the face of a lot of supply in the market. So some of the pressure that we saw in q two was not necessarily in the bigger heavy stuff, where it feel like we found a bottom, but but more on the the compact side, which was a little bit of a surprise. We you know, our call at the beginning of the year that we thought we would be through some of the supply gut, sorry, glut by in the marketplace, not necessarily our own inventory. We think that's in good shape. But in the marketplace, we continue to kind of see it.

Speaker 3

So it's kind of a little bit annoying to to have the supply where it's at in the marketplace. But I think things have kind of stabilized. I wouldn't expect to pull back from here.

Speaker 6

Okay. That's really helpful. And just on the rental side, you guys have rightsized the fleet down fairly materially. Are you starting to see the benefits of that in the sense that utilization is improving? Or how would you characterize utilization and even just rate, generally speaking, across the fleet maybe in your territories?

Speaker 3

I would Yeah. We're still not We're improved on utilization, just given, you know, numerator, denominator. We've we've cut the size of the fleet. We're not where we wanna be. We're probably, you know, somewhere in the low sixties in terms of physical utilization, and we wanna be maybe near the high high sixties.

Speaker 3

So still lagging on that KPI. But, you know, considering where we what we've done, we we would have been much worse off. So, yeah, a little bit more room to go that way. And then I can't remember the second part of your question there, Steve.

Speaker 6

No. I think you just signed out. Was just curious about the the just the well, actually, sorry. The rate side was one other question of whether rate

Speaker 2

Oh, the rate. Yeah. Rate. Sorry. Yeah.

Speaker 3

We have we've we've seen rates pretty much hold in, hold hold firm. Nothing really to report one way or the other. I mean, certain product categories maybe, you know, one or two point gains while others maybe one or two points down, but that's a long way of saying stable on rates.

Speaker 6

Okay. Very helpful, guys. Appreciate the time.

Speaker 3

Thanks, Steve.

Operator

Thank you. At this time, we have no further questions. So this concludes our call today. Thank you very much for joining. You may now disconnect your line.

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