UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-38864

ALTA EQUIPMENT GROUP INC.

(Exact name of registrant as specified in its charter)


Delaware		83-2583782
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

13211 Merriman Road, Livonia, Michigan 48150

(Address of principal executive offices)(Zip Code)

(248) 449-6700

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.0001 par value per share	ALTG	The New York Stock Exchange
Depositary Shares representing a 1/1000th fractional interest in a share of 10% Series A Cumulative Perpetual Preferred Stock, $0.0001 par value per share	ALTG PRA	The New York Stock Exchange

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). Yes ☒ No ☐

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.




Large accelerated filer	☐	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 ☒

As of May 5, 2025, there were 33,191,065 shares of Common Stock, $0.0001 par value, and 1,200 shares of Preferred Stock, $0.0001 par value, which Preferred Stock is evidenced by 1,200,000 depositary shares, outstanding.

INDEX


			Page
PART I – FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Interim Financial Statements (Unaudited)		4
	Condensed Consolidated Balance Sheets (Unaudited)		4
	Condensed Consolidated Statements of Operations (Unaudited)		5
	Condensed Consolidated Statements of Comprehensive Loss (Unaudited)		6
	Condensed Consolidated Statements of Stockholders' Equity (Unaudited)		7
	Condensed Consolidated Statements of Cash Flows (Unaudited)		8
	Notes to Unaudited Condensed Consolidated Financial Statements		9
	Note 1.	Organization and Nature of Operations	9
	Note 2.	Summary of Significant Accounting Policies	9
	Note 3.	Revenue Recognition	10
	Note 4.	Related Party Transactions	12
	Note 5.	Inventories	12
	Note 6.	Property and Equipment and Rental Fleet	13
	Note 7.	Goodwill and Other Intangible Assets	13
	Note 8.	Floor Plans	14
	Note 9.	Long-Term Debt	15
	Note 10.	Leases	16
	Note 11.	Contingencies	17
	Note 12.	Income Taxes	17
	Note 13.	Stock-Based Compensation	18
	Note 14.	Fair Value of Financial Instruments	19
	Note 15.	Business Combinations	20
	Note 16.	Segments	20
	Note 17.	Earnings Per Share	22
	Note 18.	Subsequent Events	22
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		37
Item 4.	Controls and Procedures		37
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings		38
Item 1A.	Risk Factors		38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		38
Item 3.	Defaults Upon Senior Securities		38
Item 4.	Mine Safety Disclosures		38
Item 5.	Other Information		38
Item 6.	Exhibits		39
	Signature		40

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this Form 10-Q may be considered “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained herein are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause our actual results, performance or achievements to be materially different from those expressed or implied by any such forward-looking statements. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward looking. Forward-looking statements may include, for example, statements about: our future financial performance; our plans for expansion and acquisitions; and changes in our strategy, future operations, financial position, estimated revenues, income or loss, projected costs, prospects, plans and objectives of management.

These forward-looking statements are based on current information available, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing the Company’s views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

Some factors that could cause actual results to differ include, but are not limited to the risks below, which also serves as a summary of the principal risks of an investment in our securities:

•

supply chain disruptions and inflationary pressures resulting from supply chain disruptions;

•

labor market dynamics that impact the price and availability of labor;

•

economic, industry, business and political conditions including their effects on governmental policy and government actions that disrupt our supply chain or sales channels, including taxes and tariffs which impact us or our key suppliers;

•

adverse banking and governmental regulations, resulting in a potential reduction to the fair value of our assets;

•

the performance and financial viability of key suppliers, contractors, customers, and financing sources;

•

our key OEM's relative approaches to competitive pricing dynamics in the marketplace and how their approaches impact the competitiveness of the equipment we sell and our market share;

•

fluctuations in interest rate levels and the relative tenor of those levels;

•

the demand and market price for our equipment and product support;

•

negative impacts on customer payment policies;

•

collective bargaining agreements and our relationship with our union-represented employees;

•

our success in identifying acquisition targets and integrating acquisitions;

•

our success in expanding into and doing business in additional markets;

•

our ability to raise capital at favorable terms;

•

the competitive environment for our products and services;

•

our ability to continue to innovate and develop new business lines;

•

our ability to attract and retain key personnel, including, but not limited to, skilled technicians;

•

our ability to maintain our listing on the New York Stock Exchange (“NYSE”);

•

the impact of cyber or other security threats or other disruptions to our businesses;

•

our ability to realize the anticipated benefits of acquisitions or divestitures, rental fleet and other organic investments or internal reorganizations;

•

federal, state and local government budget uncertainty, especially as it relates to infrastructure projects and taxation;

•

currency risks and other risks associated with international operations; and

•

other risks and uncertainties identified in the section entitled “Risk Factors” in our annual report on Form 10-K and other filings with the United States ("U.S.") Securities and Exchange Commission (the “SEC”).

For a discussion identifying additional important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, see our filings with the SEC including, but not limited to, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, and in this Quarterly Report on Form 10-Q. The foregoing list of factors is not exclusive and undue reliance should not be placed upon any forward-looking statements, which speak only as of the date made.

PART I

Item 1. Financial Statements

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in millions, except share and per share amounts)


	March 31, 2025			December 31, 2024
ASSETS
Cash	$	11.1		$	13.4
Accounts receivable, net of allowances of $11.6 and $10.7 as of March 31, 2025 and December 31, 2024, respectively		207.8			199.7
Inventories, net		544.6			535.9
Prepaid expenses and other current assets		28.3			25.5
Total current assets		791.8			774.5

NON-CURRENT ASSETS
Property and equipment, net		84.8			81.6
Rental fleet, net		362.7			358.8
Operating lease right-of-use assets, net		112.3			113.0
Goodwill		78.0			77.5
Other intangible assets, net		52.2			54.7
Other assets		22.7			20.3
TOTAL ASSETS	$	1,504.5		$	1,480.4

LIABILITIES AND STOCKHOLDERS’ EQUITY
Floor plan payable – new equipment	$	297.3		$	293.4
Floor plan payable – used and rental equipment		70.0			81.1
Current portion of long-term debt		11.2			10.5
Accounts payable		94.5			91.5
Customer deposits		15.0			14.8
Accrued expenses		63.7			51.2
Current operating lease liabilities		14.8			15.1
Current deferred revenue		11.8			13.0
Other current liabilities		5.6			6.6
Total current liabilities		583.9			577.2

NON-CURRENT LIABILITIES
Line of credit, net		217.1			179.8
Long-term debt, net of current portion		480.8			480.0
Finance lease obligations, net of current portion		37.1			35.5
Deferred revenue, net of current portion		4.6			4.3
Long-term operating lease liabilities, net of current portion		103.4			103.5
Deferred tax liabilities		11.2			10.8
Other liabilities		10.4			11.7
TOTAL LIABILITIES		1,448.5			1,402.8
CONTINGENCIES - NOTE 11
STOCKHOLDERS’ EQUITY
Preferred stock, $0.0001 par value per share, 1,000,000 shares authorized, 1,200 shares issued and outstanding at both March 31, 2025 and December 31, 2024 (1,200,000 Depositary Shares representing a 1/1000th fractional interest in a share of 10% Series A Cumulative Perpetual Preferred Stock)		—			—
Common stock, $0.0001 par value per share, 200,000,000 shares authorized; 33,191,065 and 32,762,135 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively		—			—
Additional paid-in capital		245.1			243.5
Treasury stock at cost, 1,587,702 shares of common stock held at both March 31, 2025 and December 31, 2024		(11.7	)		(11.7	)
Accumulated deficit		(172.8	)		(149.3	)
Accumulated other comprehensive loss		(4.6	)		(4.9	)
TOTAL STOCKHOLDERS’ EQUITY		56.0			77.6
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,504.5		$	1,480.4

The accompanying notes are an integral part of these condensed consolidated financial statements.

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(in millions, except share and per share amounts)


	Three Months Ended March 31,
	2025			2024
Revenues:
New and used equipment sales	$	221.7		$	228.6
Parts sales		72.0			72.9
Service revenues		66.1			64.0
Rental revenues		42.3			48.5
Rental equipment sales		20.9			27.6
Total revenues		423.0			441.6
Cost of revenues:
New and used equipment sales		188.1			192.4
Parts sales		47.6			48.3
Service revenues		26.4			27.0
Rental revenues		5.0			6.7
Rental depreciation		24.9			27.1
Rental equipment sales		16.0			19.5
Total cost of revenues		308.0			321.0
Gross profit		115.0			120.6
Selling, general and administrative expenses		106.7			114.6
Non-rental depreciation and amortization		7.5			6.9
Total operating expenses		114.2			121.5
Income (loss) from operations		0.8			(0.9	)
Other (expense) income:
Interest expense, floor plan payable – new equipment		(3.2	)		(2.8	)
Interest expense – other		(18.7	)		(13.3	)
Other income		0.9			0.9
Total other expense, net		(21.0	)		(15.2	)
Loss before taxes		(20.2	)		(16.1	)
Income tax provision (benefit)		0.7			(4.2	)
Net loss		(20.9	)		(11.9	)
Preferred stock dividends		(0.8	)		(0.8	)
Net loss available to common stockholders	$	(21.7	)	$	(12.7	)
Basic loss per share	$	(0.65	)	$	(0.38	)
Diluted loss per share	$	(0.65	)	$	(0.38	)
Basic weighted average common shares outstanding		33,167,370			33,108,695
Diluted weighted average common shares outstanding		33,167,370			33,108,695

The accompanying notes are an integral part of these condensed consolidated financial statements.

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited)

(in millions)


	Three Months Ended March 31,
	2025			2024
Net loss	$	(20.9	)	$	(11.9	)
Other comprehensive income (loss):
Foreign currency translation adjustments		—			(1.1	)
Change in fair value of derivative, net of tax		0.3			0.7
Total other comprehensive income (loss) (1)		0.3			(0.4	)
Comprehensive loss	$	(20.6	)	$	(12.3	)

(1) There were no material reclassifications from Accumulated other comprehensive loss reflected in Total other comprehensive income (loss) for the three months ended March 31, 2025 and 2024. There were no material taxes associated with Total other comprehensive income (loss) for the three months ended March 31, 2025 and 2024.

The accompanying notes are an integral part of these condensed consolidated financial statements.

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (Unaudited)

(in millions, except share and per share amounts)


	Three Months Ended March 31, 2025
	Preferred Stock				Common Stock
	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Treasury Stock			Accumulated Other Comprehensive Loss			Total Stockholders' Equity
Balance at December 31, 2024		1,200,000	$	—		32,762,135	$	—	$	243.5	$	(149.3	)	$	(11.7	)	$	(4.9	)	$	77.6
Net loss		—		—		—		—		—		(20.9	)		—			—			(20.9	)
Dividends on preferred stock, $0.625 per share		—		—		—		—		—		(0.8	)		—			—			(0.8	)
Dividends on common stock and dividend equivalent on stock-based compensation, $0.057 per share		—		—		—		—		—		(1.8	)		—			—			(1.8	)
Stock-based compensation including employee stock purchase plan		—		—		428,930		—		1.6		—			—			—			1.6
Foreign currency translation adjustments		—		—		—		—		—		—			—			—			—
Change in fair value of derivative, net of tax		—		—		—		—		—		—			—			0.3			0.3
Balance at March 31, 2025		1,200,000	$	—		33,191,065	$	—	$	245.1	$	(172.8	)	$	(11.7	)	$	(4.6	)	$	56.0


	Three Months Ended March 31, 2024
	Preferred Stock				Common Stock
	Number of Shares		Amount		Number of Shares		Amount		Additional Paid-in Capital		Accumulated Deficit			Treasury Stock			Accumulated Other Comprehensive Loss			Total Stockholders' Equity
Balance at December 31, 2023		1,200,000	$	—		32,369,820	$	—	$	233.8	$	(76.4	)	$	(5.9	)	$	(1.8	)	$	149.7
Net loss		—		—		—		—		—		(11.9	)		—			—			(11.9	)
Dividends on preferred stock, $0.625 per share		—		—		—		—		—		(0.8	)		—			—			(0.8	)
Dividends on common stock and dividend equivalent on stock-based compensation, $0.057 per share		—		—		—		—		—		(1.9	)		—			—			(1.9	)
Stock-based compensation including employee stock purchase plan		—		—		435,539		—		2.2		—			—			—			2.2
Foreign currency translation adjustments		—		—		—		—		—		—			—			(1.1	)		(1.1	)
Change in fair value of derivative, net of tax		—		—		—		—		—		—			—			0.7			0.7
Balance at March 31, 2024		1,200,000	$	—		32,805,359	$	—	$	236.0	$	(91.0	)	$	(5.9	)	$	(2.2	)	$	136.9

The accompanying notes are an integral part of these condensed consolidated financial statements.

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(in millions)


	Three Months Ended March 31,
	2025			2024
OPERATING ACTIVITIES
Net loss	$	(20.9	)	$	(11.9	)
Adjustments to reconcile net loss to net cash flows used in operating activities
Depreciation and amortization		32.4			34.0
Amortization of debt discount and debt issuance costs		1.0			0.4
Imputed interest		0.1			—
Gain on sale of property and equipment		(0.1	)		—
Gain on sale of rental equipment		(4.9	)		(8.1	)
Provision for inventory obsolescence		1.3			0.5
Provision for losses on accounts receivable		1.6			1.7
Change in fair value of derivative instruments		(0.2	)		(0.1	)
Stock-based compensation expense		1.1			1.3
Changes in deferred income taxes		(2.1	)		—
Changes in assets and liabilities, net of acquisitions:
Accounts receivable		(9.1	)		8.0
Inventories		(41.6	)		(66.3	)
Proceeds from sale of rental equipment - rent-to-sell		18.6			26.0
Prepaid expenses and other assets		(3.1	)		5.0
Manufacturers floor plans payable		(6.0	)		0.4
Accounts payable, accrued expenses, customer deposits, and other current liabilities		15.4			(0.2	)
Leases, deferred revenue, net of current portion and other liabilities		(1.0	)		(4.2	)
Net cash used in operating activities		(17.5	)		(13.5	)
INVESTING ACTIVITIES
Expenditures for rental equipment		(12.0	)		(12.9	)
Expenditures for property and equipment		(1.7	)		(4.4	)
Proceeds from sale of property and equipment		0.2			0.1
Proceeds from sale of rental equipment - rent-to-rent		2.3			1.6
Acquisitions of businesses, net of cash acquired		(2.9	)		—
Other investing activities		(0.2	)		(0.9	)
Net cash used in investing activities		(14.3	)		(16.5	)
FINANCING ACTIVITIES
Proceeds from long-term borrowings		96.1			72.8
Principal payments on long-term debt and finance lease obligations		(61.6	)		(61.9	)
Proceeds from non-manufacturer floor plan payable		22.5			41.0
Payments on non-manufacturer floor plan payable		(24.0	)		(39.1	)
Preferred stock dividends paid		(0.8	)		(0.8	)
Common stock dividends declared and paid		(1.9	)		(1.9	)
Other financing activities		(0.8	)		(5.5	)
Net cash provided by financing activities		29.5			4.6

Effect of exchange rate changes on cash		—			—
NET CHANGE IN CASH		(2.3	)		(25.4	)

Cash, Beginning of year		13.4			31.0
Cash, End of period	$	11.1		$	5.6
Supplemental schedule of noncash investing and financing activities:
Noncash asset purchases:
Net transfer of assets from inventory to rental fleet	$	28.4		$	38.8
Supplemental disclosures of cash flow information
Cash paid for interest	$	9.9		$	10.6
Cash paid for income taxes	$	—		$	0.2

The accompanying notes are an integral part of these condensed consolidated financial statements.

ALTA EQUIPMENT GROUP INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements

(Dollars in millions, except per share data, unless otherwise indicated)

NOTE 1 — ORGANIZATION AND NATURE OF OPERATIONS

Nature of Operations

Alta Equipment Group Inc. and its subsidiaries (“Alta” or the “Company”) is engaged in the sale, service, and rental of material handling, construction, and environmental processing equipment in the states of Michigan, Illinois, Indiana, Ohio, Pennsylvania, New York, Virginia, Massachusetts, Maine, New Hampshire, Vermont, Rhode Island, Connecticut, Nevada, and Florida as well as the Canadian provinces of Quebec and Ontario. Unless the context otherwise requires, the use of the terms “the Company”, “we”, “us,” and “our” in these notes to the unaudited condensed consolidated financial statements refers to Alta Equipment Group Inc. and its consolidated subsidiaries.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements include the consolidated accounts of the Company and its subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). In our opinion, all adjustments, consisting of all normal and recurring adjustments, considered necessary for a fair presentation of our financial position, results of operations and cash flows for the periods presented have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the 2024 Form 10-K. All intercompany transactions and balances have been eliminated in the preparation of the condensed consolidated financial statements.

Immaterial Restatement of Prior Period Financial Statements

Subsequent to the issuance of the Company’s Condensed Consolidated Financial Statements filed on Form 10-Q for the period ended March 31, 2024, the Company identified a multi-year error in the presentation of its Condensed Consolidated Statements of Cash Flows. Management determined its presentation of the proceeds from the sale of rent-to-rent equipment was incorrectly presented as an operating cash flow as opposed to an investing cash flow. The effect of this error was an understatement of net cash used in operating activities by $1.6 million for the three months ended March 31, 2024 with a corresponding overstatement of net cash used in investing activities. Management has evaluated quantitative and qualitative factors for this misstatement and has concluded it was not material to the prior periods.

The following table reflects the effects of the correction on all affected line items of the Company’s previously reported Condensed Consolidated Financial Statements presented in this Form 10-Q:


	Three Months Ended March 31, 2024
	As Previously Reported			Adjustment			As Restated
OPERATING ACTIVITIES
Proceeds from sale of rental equipment - rent-to-sell	$	27.6		$	(1.6	)	$	26.0
Net cash used in operating activities		(11.9	)		(1.6	)		(13.5	)
INVESTING ACTIVITIES
Proceeds from sale of rental equipment - rent-to-rent		—			1.6			1.6
Net cash used in investing activities		(18.1	)		1.6			(16.5	)

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

We describe our significant accounting policies in Note 2 of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024. During the three months ended March 31, 2025, there were no significant changes to those accounting policies.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Estimates are based on assumptions that we believe are reasonable under the circumstances. Due to the inherent uncertainty involved with estimates, actual results may differ.

New Accounting Pronouncements

New Accounting Pronouncements Not Yet Adopted

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This guidance requires disaggregated income tax disclosures on the rate reconciliation and income taxes paid by jurisdiction. The Company is required to adopt the guidance in the 2025 Annual Report on Form 10-K. The guidance will require additional disclosures in the Income Tax footnote but will not have a material impact on our consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). This guidance requires additional disclosure in the notes to the financial statements of specified information about certain statement of operations expense line items. The Company is required to adopt the guidance in the 2027 Annual Report on Form 10-K and in our interim periods during 2028, though early adoption is permitted. The Company is currently evaluating the impact of this guidance on our consolidated financial statements.

The Company believes all other recently issued accounting pronouncements from the FASB that the Company has not noted above will not have a material impact on our consolidated financial statements or do not apply to us.

NOTE 3 — REVENUE RECOGNITION

We recognize revenue in accordance with two different accounting standards: 1) Topic 606, Revenues from Contracts with Customers ("Topic 606") and 2) Topic 842, Leases, ("Topic 842").

Disaggregation of Revenues

The following tables summarize the Company’s disaggregated revenues as presented in the Condensed Consolidated Statements of Operations for the three months ended March 31, 2025 and 2024 by revenue type and the applicable accounting standard.


	Three Months Ended March 31, 2025						Three Months Ended March 31, 2024
	Topic 842		Topic 606		Total		Topic 842		Topic 606		Total
Revenues:
New and used equipment sales	$	—	$	221.7	$	221.7	$	—	$	228.6	$	228.6
Parts sales		—		72.0		72.0		—		72.9		72.9
Service revenues		—		66.1		66.1		—		64.0		64.0
Rental revenues		42.3		—		42.3		48.5		—		48.5
Rental equipment sales		—		20.9		20.9		—		27.6		27.6
Total revenues	$	42.3	$	380.7	$	423.0	$	48.5	$	393.1	$	441.6

The Company believes that the disaggregation of revenues from contracts with customers as summarized above, together with the discussion below, depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by economic factors. See Note 16, Segments, for further information.

Leases revenues (Topic 842)

Rental revenues: Owned equipment rentals represent revenues from renting equipment. The Company accounts for these rental contracts as operating leases. The Company recognizes revenues from equipment rentals in the period earned, regardless of the timing of billing to customers. A rental contract includes rates for daily, weekly, or monthly use, and rental revenues are earned on a daily basis as rental contracts remain outstanding. Because the rental contracts can extend across multiple reporting periods, the Company records unbilled rental revenues and deferred rental revenues at the end of each reporting period. Unbilled rental revenues are included as a component of "Accounts receivable, net" on the Condensed Consolidated Balance Sheets. Rental equipment may also be purchased outright (“Rental equipment sales”) by our customers. Rental revenues and revenues attributable to rental equipment sales are recognized in "Rental revenues" and "Rental equipment sales" on the Condensed Consolidated Statements of Operations, respectively.

Revenues from contracts with customers (Topic 606)

Accounting for the different types of revenues pursuant to Topic 606 is discussed below. The Company’s revenues under Topic 606 are primarily recognized at a point in time rather than over time.

New and used equipment sales: With the exception of bill-and-hold arrangements and project-based revenues, the Company’s revenues from the sale of new and used equipment are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good(s). Under bill-and-hold arrangements, revenues are recognized when all configuration work is complete and the equipment has been set aside for final shipment, at which point the Company has determined control has been transferred. The bill-and-hold arrangements primarily apply to sales when physical shipment of heavy equipment to the customer is prohibited by law (e.g., frost laws) or requested by the customer due to their inability to arrange freight simultaneous to the satisfaction of the performance obligations. The customer equipment sold under a bill-and-hold arrangement is physically separated from Company inventory and that equipment cannot be used by the Company or sold to another customer. Revenues recognized from bill-and-hold agreements totaled $10.8 million and $2.9 million for the three months ended March 31, 2025 and 2024, respectively. The Company does not offer material rights of return.

Project-based revenues, as referred to herein, are contracts with customers where the Company provides design and build solutions related to automated equipment installation and warehouse management systems integration. These revenues are recognized as the performance obligations are satisfied over time using the cost-to-cost input method, based on contract costs incurred to date to total estimated contract costs. The Company recognizes deferred revenue with respect to project-based services. The Company recognized $19.0 million and $17.0 million in project-based revenues for the three months ended March 31, 2025 and 2024 respectively.

Parts sales: Revenues from the sale of parts are recognized at the time of pick-up by the customer for over-the-counter sales transactions and at the time services are completed for parts associated with periodic maintenance services. For parts that are shipped to a customer, the Company has elected to use a practical expedient of Topic 606 and treat such shipping activities as fulfillment costs, thereby recognizing revenues at the time of shipment, which is when the customer obtains control.

Service revenues: The Company records service revenues primarily from guaranteed maintenance contracts and periodic services with customers. The Company recognizes periodic maintenance service revenues at the time such services are completed. The Company recognizes guaranteed maintenance contract revenues over time based on an estimated rate at which the services are provided over the life of the contract, typically three to five years. Revenues recognized from guaranteed maintenance contracts totaled $5.4 million and $5.5 million for the three months ended March 31, 2025 and 2024, respectively. The Company also records service revenues from warranty contracts whereby the Company performs service on behalf of an Original Equipment Manufacturer (“OEM”) or third-party warranty provider.

Rental equipment sales: The Company also sells rental equipment from our rental fleet. These sales are recognized at the time of delivery to, or pick-up by, the customer, which is when the customer obtains control of the promised good(s). Rental equipment sales may occur at various stages in an equipment’s lifecycle, depending on customer demand and original purchase intentions of the equipment. Rent-to-rent equipment, for instance, is originally purchased directly into the rental fleet for the primary purpose of renting, as opposed to selling. Rental equipment sales of rent-to-rent equipment are therefore typically made toward the end of the useful life of the equipment. Rent-to-sell equipment, on the other hand, is originally purchased as new inventory stock but is subsequently transferred to rental fleet and rented to customers based on rental fleet utilization levels and market conditions. Ultimately, rent-to-sell equipment primarily serves the numerous applications of our Construction Equipment segment customers and allows the Company to create different model years of equipment at varying price points to fulfill market demand for lower hour, lightly used construction equipment. Certain rental agreements contain a rental purchase option, whereby the customer has an option to purchase the rented equipment during the term of the rental agreement. In this case, revenues from the sale of rental equipment are recognized at the time the rental purchase option agreement has been approved and signed by both parties, as the equipment is already in the customer’s possession under the terms of the rental agreement, and therefore control has been transferred concurrently with the title.

Contract Costs

The Company does not recognize assets associated with the incremental costs of obtaining a contract with a customer that the Company expects to recover (e.g., a sales commission). Most of the Company’s revenues are recognized at a point in time or over a period of one year or less, and the Company has used the practical expedient that allows us to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less. The amount of the costs associated with the revenues recognized over a period of greater than one year is insignificant.

Receivables and Contract Assets and Liabilities

With respect to our receivables, we believe the concentration of credit risk is limited because our customer base is comprised of a large number of geographically diverse customers.

The Company has contract assets and contract liabilities associated with project-based contracts with customers.

Contract assets are fulfilled contractual obligations prior to receivables being recognizable for project-based revenues. Contract assets as of March 31, 2025 and December 31, 2024 were $5.1 million and $4.2 million, respectively.

Deferred revenue (contract liabilities) includes the unearned portion of project-based revenues, revenues related to guaranteed maintenance contracts for customers covering equipment previously purchased, and deferred revenue related to rental agreements. Total deferred revenue relating to project-based revenues, guaranteed maintenance contracts, and equipment rental agreements as of March 31, 2025 and December 31, 2024 was $16.4 million and $17.3 million, respectively. For the three months ended March 31, 2025 and 2024, the Company recognized revenues of $7.9 million and $8.1 million, respectively, from the prior year ending deferred revenue balance.

NOTE 4 — RELATED PARTY TRANSACTIONS

Our Chief Executive Officer ("CEO"), Chief Financial Officer, and Chief Operating Officer collectively own an indirect, non-controlling minority interest in OneH2, Inc. (“OneH2”), which they each acquired through various transactions that took place in early 2018 and prior. Our CEO is on the Board of Directors of OneH2. OneH2 is a privately held company that produces and delivers hydrogen fuel to end users and manufactures modular hydrogen plants and related equipment. During the three months ended March 31, 2025 and 2024, the Company purchased $0.1 million and $0.6 million, respectively, of hydrogen fuel from OneH2. In addition, the Company has paid OneH2 $5.3 million to date to build and commercialize a hydrogen production plant for the Company which we expect to become operational in the second half of 2025.

NOTE 5 — INVENTORIES

Inventories, net, consisted of the following:


	March 31,			December 31,
	2025			2024
New equipment	$	386.2		$	374.0
Used equipment		58.0			62.0
Work in process		8.6			7.5
Parts		103.0			101.8
Gross inventory		555.8			545.3
Inventory reserves		(11.2	)		(9.4	)
Inventories, net	$	544.6		$	535.9

Direct labor of $0.7 million and $0.6 million incurred for open service orders were capitalized and included in work in process as of March 31, 2025 and December 31, 2024, respectively. The remaining work in process balances as of March 31, 2025 and December 31, 2024 primarily represent parts applied to open service orders. Rental depreciation expense for new and used equipment inventory under short-term leases with purchase options was $2.8 million and $3.1 million for the three months ended March 31, 2025 and 2024, respectively.

NOTE 6 — PROPERTY AND EQUIPMENT AND RENTAL FLEET

Property and equipment, net, consisted of the following:


	March 31,			December 31,
	2025			2024
Land	$	3.0		$	3.0
Buildings, equipment, and leasehold improvements:
Machinery and equipment		11.2			9.6
Autos and trucks		7.1			7.3
Buildings and leasehold improvements		26.5			25.5
Construction in progress		6.6			7.0
Finance lease right-of-use assets		68.4			63.6
Office equipment		5.7			5.6
Computer equipment		15.2			14.4
Total costs		143.7			136.0

Less accumulated depreciation and amortization:
Buildings, equipment, autos and trucks, leasehold improvements, finance leases and office and computer equipment		(58.9	)		(54.4	)
Property and equipment, net	$	84.8		$	81.6

Total depreciation and amortization on property and equipment was $5.0 million and $4.3 million for the three months ended March 31, 2025 and 2024, respectively.

Rental fleet, net, consisted of the following:


	March 31,			December 31,
	2025			2024
Rental fleet	$	584.1		$	571.2
Less accumulated depreciation rental fleet		(221.4	)		(212.4	)
Rental fleet, net	$	362.7		$	358.8

Total depreciation on rental fleet was $22.1 million and $24.0 million for the three months ended March 31, 2025 and 2024, respectively.

NOTE 7 — GOODWILL AND OTHER INTANGIBLE ASSETS

The following table summarizes the changes in the carrying amount of goodwill in total and by reportable segment for the three months ended March 31, 2025:


	Material Handling		Construction Equipment		Master Distribution		Total
Balance, December 31, 2024	$	14.7	$	44.5	$	18.3	$	77.5
Additions		0.5		—		—		0.5
Balance, March 31, 2025	$	15.2	$	44.5	$	18.3	$	78.0

Goodwill is tested for impairment by reporting unit annually or more frequently if events or circumstances indicate that an impairment may exist. There were no indicators of potential impairment during the three months ended March 31, 2025. See Note 15, Business Combinations, for further information.

The gross carrying amount of intangible assets and accumulated amortization as of March 31, 2025 and December 31, 2024 were as follows:


	March 31, 2025
	Weighted Average Remaining Life (in years)		Gross carrying amount		Accumulated amortization			Net carrying amount
Customer and supplier relationships		6.4	$	72.4	$	(26.1	)	$	46.3
Other intangibles		2.8		14.3		(8.4	)		5.9
Total		5.9	$	86.7	$	(34.5	)	$	52.2

	December 31, 2024
	Weighted Average Remaining Life (in years)		Gross carrying amount		Accumulated amortization			Net carrying amount
Customer and supplier relationships		6.6	$	72.4	$	(24.3	)	$	48.1
Other intangibles		3.0		14.3		(7.7	)		6.6
Total		6.1	$	86.7	$	(32.0	)	$	54.7

Amortization of intangible assets was $2.5 million and $2.6 million for the three months ended March 31, 2025 and 2024, respectively.

NOTE 8 — FLOOR PLANS

Floor Plan — First Lien Lenders

In April 2021, the Company entered into a Floor Plan First Lien Credit Agreement ("Floor Plan Credit Agreement") by and among Alta Equipment Group, Inc. and the other credit parties named therein, and the lender JP Morgan Chase Bank, N.A., as Administrative Agent. Under the Floor Plan Credit Agreement, the Company has a first lien floor plan facility (the "First Lien Floor Plan Facility") with our first lien lenders to primarily finance new inventory. On June 5, 2024, the Floor Plan Credit Agreement was amended to extend the maturity date to June 1, 2029 and increase the maximum borrowing capacity to $90.0 million. The interest cost for the First Lien Floor Plan Facility is the Secured Overnight Financing Rate ("SOFR") plus an applicable margin. The First Lien Floor Plan Facility is collateralized by substantially all assets of the Company. As of March 31, 2025 and December 31, 2024, the Company had an outstanding balance on our First Lien Floor Plan Facility of $53.1 million and $54.7 million, respectively, excluding unamortized debt issuance costs. The effective interest rate at March 31, 2025 and December 31, 2024 was 7.2% and 7.4%, respectively. The Company routinely sells equipment that is financed under the First Lien Floor Plan Facility. When this occurs the payable under the First Lien Floor Plan Facility related to the financed equipment being sold becomes due to be paid.

OEM Captive Lenders and Suppliers’ Floor Plans

The Company has floor plan financing facilities with several OEM captive lenders and suppliers (the “OEM Floor Plan Facilities”, and together with the First Lien Floor Plan Facility, collectively the “Floor Plan Facilities”) for new and used inventory and rental equipment, each with borrowing capacities ranging from $0.1 million to $160.0 million. Primarily, the Company utilizes the OEM Floor Plan Facilities for purchases of new equipment inventories. Certain OEM Floor Plan Facilities regularly provide for interest and principal free payment terms. In addition, certain OEM Floor Plan Facilities provide for up to twelve-months interest only or deferred payment periods. The Company routinely sells equipment that is financed under OEM Floor Plan Facilities. When this occurs the payable under the OEM Floor Plan Facilities related to the financed equipment being sold becomes due to be paid.

The OEM Floor Plan Facilities are secured by the equipment being financed and contain certain operating company guarantees. The interest cost is SOFR plus an applicable margin. The effective rates, excluding the favorable effect of interest-free periods, ranged from 6.9% to 10.0% as of March 31, 2025 and 7.5% to 10.5% as of December 31, 2024. As of March 31, 2025 and December 31, 2024, the Company had an outstanding balance on the OEM Floor Plan Facilities of $314.6 million and $320.2 million, respectively.

The total aggregate amount of financing under the Floor Plan Facilities cannot exceed $495.0 million at any time, which is subject to a 10% annual increase. To better align with our business operations, on February 28, 2024 the Company amended our ABL Facility and First Lien Floor Plan Facility primarily for the purpose of moving the effective date of such annual increase to December 31st of each year, beginning with December 31, 2023. The total outstanding balance under the Floor Plan Facilities as of March 31, 2025 and December 31, 2024, was $367.7 million and $374.9 million, respectively, excluding unamortized debt issuance costs. For the three months ended March 31, 2025 and 2024, the Company recognized interest expense associated with new equipment financed under our Floor Plan Facilities of $3.2 million and $2.8 million, respectively. The weighted average rate, excluding the favorable effect of interest-free periods, on the Company's Floor Plan Facilities was 7.6% and 8.7% as of March 31, 2025 and 2024, respectively.

NOTE 9 — LONG-TERM DEBT

Line of Credit — First Lien Lenders

In April 2021, the Company entered into a Sixth Amended and Restated ABL First Lien Credit Agreement (the “Amended and Restated ABL Credit Agreement”) by and among Alta Equipment Group Inc. and the other credit parties named therein, the lenders named therein, JP Morgan Chase Bank, N.A., as Administrative Agent, and the syndication agents and documentation agent named therein. Under the Amended and Restated ABL Credit Agreement, the Company has an asset-based revolving line of credit (the “ABL Facility”) with our first lien holder with advances on the line being supported by eligible accounts receivable, parts, and otherwise unencumbered new and used equipment inventory and rental equipment. On June 5, 2024, the Company amended the ABL Facility primarily to extend the maturity date and increase the facility size. The borrowing capacity on the ABL Facility, which expires June 1, 2029, was increased to $520.0 million, which includes a $45.0 million Canadian-denominated sublimit facility. The ABL Facility is collateralized by substantially all assets of the Company, and the interest cost is SOFR plus an applicable margin on the CB Floating Rate, depending on borrowing levels. As of March 31, 2025 and December 31, 2024, the Company had an outstanding ABL Facility balance of $220.0 million and $182.9 million, respectively, excluding unamortized debt issuance costs. The effective interest rate was 6.0% and 6.2% at March 31, 2025 and December 31, 2024, respectively.

Maximum borrowings under the Floor Plan Facilities and ABL Facility are limited to $1,015.0 million unless certain other conditions are met. The total amount outstanding as of March 31, 2025 and December 31, 2024, was $587.7 million and $557.8 million, exclusive of debt issuance and deferred financing costs of $3.3 million and $3.5 million, respectively.

Senior Secured Second Lien Notes

On June 5, 2024, the Company completed a private offering of Senior Secured Second Lien Notes (the “Notes”), for the purposes of, among other things, repayment and refinancing of a portion of the Company’s prior existing debt, reducing variable interest rate exposure, providing liquidity for general corporate purposes, and for financing of future growth initiatives. The Company sold $500.0 million of Notes at the rate of 9.000% per annum, which are due on June 1, 2029. Interest on the Notes is payable in cash on June 1 and December 1 of each year, commencing on December 1, 2024. The Notes were sold in a private placement in reliance on Rule 144A and Regulation S under the Securities Act of 1933, as amended, pursuant to a purchase agreement among the Company, the domestic subsidiaries of the Company (as guarantors), and J.P. Morgan Securities LLC, as representative of the initial purchasers.

The Notes are guaranteed by each of our existing and future domestic subsidiaries. The Notes and the guarantors thereof are secured, subject to certain exceptions and permitted liens, by second-priority liens on substantially all of our assets and the assets of the guarantors that secure on a first-priority basis all of the indebtedness under our ABL Facility and the First Lien Floor Plan Facility and certain hedging and cash management obligations, including, but not limited to, equipment, fixtures, inventory, intangibles and capital stock of our restricted subsidiaries now owned or acquired in the future by us or the guarantors.

As of March 31, 2025, outstanding borrowings under the Notes were $480.8 million, which included $19.2 million deferred financing costs and original issue discounts. As of December 31, 2024, outstanding borrowings under the Notes were $480.0 million, which included $20.0 million deferred financing costs and original issue discounts. The effective interest rate on the Notes, taking into account the original issue discount, is 10.1%.

The Company’s long-term debt consists of the following:


	March 31,			December 31,
	2025			2024
Line of credit	$	220.0		$	182.9
Senior secured second lien notes		500.0			500.0
Unamortized debt issuance costs		(4.2	)		(4.3	)
Debt discount		(17.9	)		(18.8	)
Finance leases		48.3			46.0
Total debt and finance leases		746.2			705.8
Less: current maturities		(11.2	)		(10.5	)
Long-term debt and finance leases, net	$	735.0		$	695.3

As of March 31, 2025, the Company was in compliance with the financial covenants set forth in our debt agreements.

Notes Payable – Non-Contingent Consideration

The following table sets forth the Company’s non-contingent consideration liabilities measured and recorded at the present value of cash payments, using a market participant discount rate and their presentation on the Condensed Consolidated Balance Sheets related to the Company's acquisitions of Ault Industries Inc. (“Ault”), Ecoverse Industries, LTD ("Ecoverse"), and Peaklogix LLC.


	March 31,		December 31,
Location on Balance Sheet	2025		2024
Other current liabilities	$	2.7	$	2.7
Other liabilities		3.7		4.9
Total	$	6.4	$	7.6

See Note 14, Fair Value of Financial Instruments for further information.

NOTE 10 — LEASES

The Company primarily has third-party operating and finance leases for branch facilities, corporate office, and certain equipment. The Company has one immaterial operating lease with a related party. The Company’s leases have remaining lease terms that range from less than one year to leases that mature through December 2039 and contain provisions to renew the leases for additional terms of up to 20 years.

The Company leases and subleases certain lift trucks to customers under short and long-term operating lease agreements. The sublease income is included in "Rental revenues" on our Condensed Consolidated Statements of Operations. Sublease income below includes subleases of primarily facilities that are not included in "Rental revenues" due to being outside our normal business operations. The costs of the head lease for these subleases are included in Operating lease expense below.

At March 31, 2025 and December 31, 2024, assets recorded under finance leases, net of accumulated depreciation, were $45.6 million and $43.6 million, respectively. The assets are depreciated over the lesser of their remaining lease terms or estimated useful lives.

The components of lease expense were as follows:


	Three Months Ended March 31,
	2025			2024
Operating lease expense	$	6.9		$	6.8
Short-term lease expense		0.9			2.4
Low-value lease expense		0.3			0.3
Variable lease expense		3.1			2.7
Finance lease expense:
Amortization of right-of-use assets		2.9			2.3
Interest on lease liabilities		1.0			0.9
Sublease income		(0.1	)		(0.1	)
Total lease expense	$	15.0		$	15.3

Additional information related to leases is presented in the table below:


	Three Months Ended March 31,
Supplemental Cash Flows Information	2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	6.7	$	6.6
Operating cash flows for finance leases		1.0		0.9
Financing cash flows for finance leases		2.7		2.0
Non-cash right-of-use assets obtained in exchange for lease obligations:
Operating leases		3.5		3.5
Finance leases		5.0		4.8
Weighted Average Remaining Lease Term (in years):
Operating leases		8.5		8.8
Finance leases		4.2		4.7
Weighted Average Discount Rate (in %):
Operating leases		10.6		10.3
Finance leases		8.9		8.4

Minimum future lease payments under non-cancellable operating and finance leases described above as of March 31, 2025 were as follows:


Year ending December 31,	Operating Leases			Finance Leases
Remainder of 2025	$	19.4		$	11.2
2026		23.4			14.2
2027		22.1			12.7
2028		20.3			10.7
2029		15.7			6.8
Thereafter		82.1			2.0
Total future minimum lease payments		183.0			57.6
Less: imputed interest		(64.8	)		(9.3	)
Total	$	118.2		$	48.3


Balance Sheet Location	March 31, 2025			December 31, 2024
Current portion of long-term debt	$	11.2		$	10.5
Current operating lease liabilities		14.8			15.1
Finance lease obligations, net of current portion		37.1			35.5
Long-term operating lease liabilities, net of current portion		103.4			103.5
Total	$	166.5		$	164.6

See Note 11, Contingencies, for more information on certain contracts where the Company guarantees the performance of the third-party lessee.

NOTE 11 — CONTINGENCIES

Guarantees

As of March 31, 2025 and December 31, 2024, the Company was party to certain contracts in which it guarantees the performance of agreements with various third-party financial institutions. In the event of a default by a third-party, the Company would be required to pay all or a portion of the remaining unpaid obligations as specified in the contract. The estimated exposure related to these guarantees was not material at both March 31, 2025 and December 31, 2024. It is anticipated that the third parties will have the ability to repay the debt without the Company having to honor the guarantee; therefore, no amount has been accrued on the Condensed Consolidated Balance Sheets as of March 31, 2025 and December 31, 2024.

Legal Proceedings

During the three months ended March 31, 2025 and 2024, various claims and lawsuits, incidental to the ordinary course of our business, were pending against the Company. In the opinion of management, after consultation with legal counsel, resolution of these matters, net of expected insurance proceeds, is not expected to have a material effect on the Company’s condensed consolidated financial statements.

Contractual Obligations

The Company does not believe there are any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on the Company. As of both March 31, 2025 and December 31, 2024 there were $12.0 million in outstanding letters of credit issued in the normal course of business. These letters of credit reduce our available borrowings under our ABL Facility.

NOTE 12 — INCOME TAXES

The Company recognized an income tax expense of $0.7 million and benefit of $4.2 million for the three months ended March 31, 2025 and 2024, respectively.

For the three months ended March 31, 2025, the income tax expense was primarily attributable to adjustments of the Company's valuation allowance against a portion of the deferred tax asset relating to U.S. disallowed interest expense carryforwards partially offset by the benefit attributable to the net loss for the period. During the three months ended March 31, 2024, the income tax benefit was primarily attributable to the net loss for the period. We regularly assess the need for a valuation allowance against our deferred tax assets. In making that assessment, we consider both positive and negative evidence related to the likelihood of realization of the deferred tax assets as well as the nature of the deferred tax attribute to determine, based on the weight of available evidence, whether it is more likely than not that some or all of the deferred tax assets will not be realized. We will continue to monitor the need for a valuation allowance against our deferred tax assets on a quarterly basis.

The effective tax rate for the three months ended March 31, 2025 and 2024 was (3.5)% and 26.1%, respectively. The effective income tax rate in both periods is primarily the result of the discrete items noted above and 2024 had no jurisdictions limited by a valuation allowance.

NOTE 13 — STOCK-BASED COMPENSATION

Compensation for our senior leadership team includes equity awards in the form of restricted stock units ("RSUs") and performance stock units ("PSUs"). We calculate the fair value of the RSUs and PSUs at grant date based on the closing market price of our common stock at the date of grant. The compensation expense is recognized on a straight-line basis over the requisite service period of the award. The number of PSUs granted depends on the Company's achievement of target performance goals, which may range from 0% to 200% of the target award amount. The PSUs vest ratably over three years including the one-year performance period. Upon vesting, each stock award is exchangeable for one share of the Company's common stock, with accrued dividends.

The Company recognized total stock-based compensation expense for PSUs and RSUs of $0.9 million and $1.1 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, the total unrecognized compensation expense related to the non-vested portion of the Company's RSUs was $2.9 million, which is expected to be recognized over a weighted average period of 1.7 years. As of March 31, 2025, the total unrecognized compensation expense related to the non-vested portion of the Company's PSUs was $4.6 million, which is expected to be recognized over a weighted average period of 2.2 years.

The following table shows the number of stock awards that were granted, vested, and issued during the three months ended March 31, 2025:


	Restricted Stock Units					Performance Stock Units
	Number of units			Weighted average grant date fair value		Number of units			Weighted average grant date fair value
Unvested units as of December 31, 2024		204,433		$	12.47		325,081		$	14.13
Granted		332,026			5.16		665,159			5.16
Vested - issued		(89,741	)		13.06		(241,634	)		13.54
Vested - unissued		(11,608	)		8.38		—			—
Unvested units as of March 31, 2025		435,110		$	6.88		748,606		$	6.35

Employee Stock Purchase Plan (ESPP)

On June 8, 2023 the Company filed a Form S-8 to register 325,000 common stock shares, the total shares reserved for the ESPP. The Company then opened enrollment for the first offering period that started July 1, 2023 and continued through December 31, 2023. There are two six-month offering periods each year starting January 1 and July 1, with the purchase date on the last business day of each offering period.

Under the ESPP, eligible employees (as defined in the ESPP) can purchase the Company’s common stock through accumulated payroll deductions. Eligible employees may purchase the Company’s common stock at 85% of the lower of the fair market value of the Company’s common stock on the first or last business day of each six-month offering period. Eligible employees may contribute up to 10% of their eligible compensation. Under the ESPP, a participant may not accrue rights to purchase more than $25,000 worth of the Company’s common stock for each calendar year in which such right is outstanding.

Employees who elect to participate in the ESPP commence payroll withholdings that accumulate through the end of the respective period. In accordance with the guidance in Topic 718-50 – Compensation – Stock Compensation, stock-based compensation expense is determined based on the grant-date fair value of the option or ability to purchase the shares at a discount and is recognized over the withholding period. The stock-based compensation expense related to the ESPP recognized during the three months ended March 31, 2025 and 2024 was not material.

ESPP employee payroll contributions accrued as of March 31, 2025 and December 31, 2024 totaled $0.5 million and $0.9 million, respectively, and are included within "Accrued expenses" in the Condensed Consolidated Balance Sheets. Cash withheld via employee payroll deductions is presented in financing activities within "Other financing activities" in the Condensed Consolidated Statements of Cash Flows.

NOTE 14 — FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying value of financial instruments reported in the accompanying Condensed Consolidated Balance Sheets for "Cash", "Accounts receivable, net", "Accounts payable", "Accrued expenses" and "Other current liabilities" approximate fair value due to the immediate or short-term nature or maturity of these financial instruments.

The following is a description of the valuation methodologies used for assets and liabilities measured at fair value on a recurring basis:

Debt Instruments

The carrying value of the Company's debt instruments vary from their fair values. The fair values were determined by reference to transacted prices and quotes for these instruments and upon current borrowing rates with similar maturities, which are Level 2 fair value inputs. The estimated fair value, as well as the carrying value, of the Company's debt instruments are shown below:


	March 31, 2025		December 31, 2024
Estimated aggregate fair value (1)	$	698.3	$	706.4
Aggregate carrying value (1)		768.3		728.9

(1) Total debt excluding the impact of unamortized debt discount and debt issuance costs.

Contingent Consideration

The contingent consideration liability represents the fair value of future earn-out obligations that the Company may be required to pay in conjunction with past acquisitions upon the achievement of certain performance milestones. The earn-outs for the acquisitions are measured at fair value in each reporting period, based on Level 3 inputs, with any change to the fair value recorded in the Condensed Consolidated Statements of Operations.

The following table sets forth the Company’s contingent consideration liabilities measured and recorded at fair value and their presentation on the Condensed Consolidated Balance Sheets:


	Level 3
Balance Sheet Location	March 31, 2025		December 31, 2024
Other current liabilities	$	—	$	—
Other liabilities		5.7		5.7

Derivative Financial Instruments

In the normal course of business, we are exposed to market risks associated with changes in foreign currency exchange rates, commodity prices, and interest rates. To manage a portion of these inherent risks, we may purchase certain types of derivative financial instruments based on management's judgment of the trade-off between risk, opportunity, and cost. We do not hold or issue derivative financial instruments for trading or speculative purposes. The impact of hedge ineffectiveness for those derivatives where hedge accounting is applied was not significant in any of the periods presented. The Company has determined the fair value of all our derivative contracts are based on Level 2 inputs such as quoted market prices for similar instruments from third parties and inputs other than quoted prices that are observable (forward curves, implied volatility, counterparty credit risks). The Company reviews counterparty credit risks at regular intervals and has not experienced any significant credit loss as a result of counterparty nonperformance in the past.

Interest Rate Cap

We entered into an interest rate cap to protect cash flows from the risks associated with interest payments from interest rate increases on variable rate debt. The interest rate cap is a derivative instrument designated as a cash flow hedge under Topic 815 – Derivatives and Hedging. The premiums are recognized in the Condensed Consolidated Statements of Operations when paid from the effective date through the termination date. All changes in the fair value of the interest rate cap are deferred in AOCI and subsequently recognized in earnings in the period when the derivative contract settles. The unrealized impact on earnings on the interest rate cap for the three months ended March 31, 2025 and 2024, respectively, are disclosed in the Condensed Consolidated Statements of Comprehensive Loss.

Fuel Purchase Contracts

From time to time, we enter into fixed price swap contracts to purchase gasoline and diesel fuel to protect cash flows from the risks associated with fluctuations in fuel prices on a portion of anticipated future purchases. The fixed price swap contracts to purchase gasoline and diesel fuel are derivative instruments not designated as hedging instruments under Topic 815.

The following table summarizes the maturity dates, unit of measure, and notional value for the Company's derivative instruments as of March 31, 2025:


Maturity Date of Derivatives	Currency / Unit of Measure	Notional Value
Interest rate cap (December 2025)	One-month SOFR	$	200.0
Fuel swaps (various through February 2027)	Gallons		4.6

The following table sets forth the location and fair value of the Company’s derivative instruments as of March 31, 2025 and December 31, 2024 on the Condensed Consolidated Balance Sheets:


	Asset Derivatives					Liability Derivatives
Derivative designated as hedge	Balance Sheet location	March 31, 2025		December 31, 2024		Balance Sheet location	March 31, 2025		December 31, 2024
Interest rate cap - current portion	Prepaid expenses and other current assets	$	—	$	0.2	Other current liabilities	$	1.2	$	1.6
Derivatives not designated as hedge
Fuel swaps - current portion	Prepaid expenses and other current assets		—		—	Other current liabilities		0.2		0.3
Fuel swaps - long-term	Other assets		—		—	Other liabilities		—		0.1

NOTE 15 — BUSINESS COMBINATIONS

On March 14, 2025, the Company purchased the assets of Les Chariots Elevateurs Du Quebec Inc. ("CEQ"), a privately held Yale dealer with one branch in Quebec, Canada. The purchase price was $2.9 million, net of cash acquired. The acquisition is not material for the three months ended March 31, 2025; therefore, we did not include an opening balance sheet herein. CEQ is reported within our Material Handling segment. The estimated fair values of assets acquired and liabilities assumed are provisional and based on the information that was available as of the balance sheet date. The Company expects to finalize the valuation and complete the purchase price allocation as soon as practical but no later than one year from the acquisition date. Costs and expenses related to the acquisition have been expensed as incurred in operating expenses. See the Condensed Consolidated Statements of Cash Flows for the total cash outflow in "Acquisitions of businesses, net of cash acquired" for the cash flow impact of the acquisition.

NOTE 16 — SEGMENTS

The Company has three operating segments which are also our reportable segments: Material Handling, Construction Equipment, and Master Distribution. All other business activities, including commercial electric vehicles and corporate, are included in "Corporate and Other". The Company’s segments are determined based on management structure, which is organized based on types of products and services sold, as described in the following paragraphs. The operating results for each segment are reported separately to the Company’s CEO (our Chief Operating Decision Maker or "CODM") to make decisions regarding the allocation of resources, to assess the Company’s performance and to make strategic decisions. The primary profitability measurement used by the CEO to evaluate performance and allocate resources to the segments is Adjusted EBITDA. The Company's presentation of Adjusted EBITDA may not be comparable to similar measures used by other companies and is not necessarily indicative of the results of operations that would have occurred had each reportable segment been an independent, stand-alone entity during the periods presented.

The Material Handling segment is principally engaged in operations related to the sale, service, and rental of lift trucks and other material handling equipment in Michigan, Illinois, Indiana, New York (including New York City), Virginia and the New England region of the U.S. as well as the Ontario and Quebec provinces of Canada.

The Construction Equipment segment is principally engaged in operations related to the sale, service, and rental of construction equipment in Michigan, Illinois, Indiana, Ohio, Pennsylvania, New York (excluding New York City), Florida and the New England region of the U.S. as well as the Ontario and Quebec provinces of Canada.

The Master Distribution segment is principally engaged in large-scale equipment distribution with sub dealers throughout the United States and Canada related to environmental processing equipment.

The Company retains various unallocated expense items at the general corporate level, which the Company refers to as “Corporate and Other” in the table below. Corporate and Other holds corporate debt and has minor transactional activity all together including Alta e-mobility (e.g., commercial electric vehicles) revenues and costs. Corporate and Other incurs expenses associated with compensation (including stock-based compensation) of our directors, corporate officers and members of our shared-services team, consulting and legal fees related to acquisitions and capital raising activities, corporate governance, audit and tax preparation related fees and other compliance related matters, certain corporate development related expenses, interest expense associated with original issue discounts and deferred financing cost related to previous capital raises, and a portion of the Company’s income tax provision. There is also intercompany elimination activity presented within Corporate and Other.

The following tables summarize key financial information by reportable segment:


	Three Months Ended March 31, 2025
	Material Handling		Construction Equipment		Master Distribution		Corporate and Other			Total
Revenues:
New and used equipment sales	$	78.4	$	126.7	$	14.8	$	1.8		$	221.7
Parts sales		24.3		45.3		2.4		—			72.0
Service revenues		34.1		31.8		0.2		—			66.1
Rental revenues		17.6		24.6		—		0.1			42.3
Rental equipment sales		3.5		17.4		—		—			20.9
Total revenues		157.9		245.8		17.4		1.9			423.0
Cost of revenues:
New and used equipment sales		63.1		112.3		11.0		1.7			188.1
Parts sales		15.3		30.9		1.4		—			47.6
Service revenues		13.3		12.6		0.5		—			26.4
Rental revenues		1.0		4.0		—		—			5.0
Rental equipment sales		2.5		13.5		—		—			16.0
Selling, general and administrative expenses		46.5		54.6		2.5		3.1			106.7
Other segment items(1)		0.6		0.9		0.5		(2.4	)		(0.4	)
Segment adjusted EBITDA(2)		15.6		17.0		1.5		(0.5	)		33.6
Depreciation and amortization											32.4
Interest expense											21.9
Other(1)											(0.5	)
Loss before taxes										$	(20.2	)

Total assets, end of period	$	442.2	$	933.8	$	87.6	$	40.9		$	1,504.5
Capital expenditures		6.3		7.3		—		0.1			13.7
Depreciation and amortization		10.6		20.6		0.9		0.3			32.4
Interest expense		6.3		12.8		1.4		1.4			21.9


	Three Months Ended March 31, 2024
	Material Handling		Construction Equipment		Master Distribution			Corporate and Other			Total
Revenues:
New and used equipment sales	$	94.1	$	126.1	$	9.1		$	(0.7	)	$	228.6
Parts sales		24.9		45.9		2.5			(0.4	)		72.9
Service revenues		33.8		30.1		0.1			—			64.0
Rental revenues		19.0		29.1		0.4			—			48.5
Rental equipment sales		2.5		24.4		0.7			—			27.6
Total revenues		174.3		255.6		12.8			(1.1	)		441.6
Cost of revenues:
New and used equipment sales		76.3		110.0		6.8			(0.7	)		192.4
Parts sales		15.5		31.7		1.5			(0.4	)		48.3
Service revenues		14.1		12.8		0.1			—			27.0
Rental revenues		2.7		4.0		—			—			6.7
Rental equipment sales		1.5		17.6		0.4			—			19.5
Selling, general and administrative expenses		48.9		57.2		4.0			4.5			114.6
Other segment items(1)		0.8		1.0		(0.9	)		(1.9	)		(1.0	)
Segment adjusted EBITDA(2)		14.5		21.3		0.9			(2.6	)		34.1
Depreciation and amortization												34.0
Interest expense												16.1
Other(1)												0.1
Loss before taxes											$	(16.1	)

Total assets, end of period	$	466.8	$	975.9	$	85.8		$	34.8		$	1,563.3
Capital expenditures		11.0		5.7		0.2			0.4			17.3
Depreciation and amortization		9.7		22.9		1.1			0.3			34.0
Interest expense		5.1		9.8		0.9			0.3			16.1

(1) Primarily includes other income (expense) and non-recurring items.

(2) See definition in Item 2 under Non-GAAP Financial Measures.

NOTE 17 — EARNINGS PER SHARE

Basic earnings per share ("EPS") is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding during the period and includes vested, unissued RSUs and ESPP shares. Diluted EPS is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding, after giving effect to all potential dilutive common shares outstanding during the period. We include all common stock share equivalents granted under our stock-based compensation plan, including ESPP, which remain unvested and shares used as consideration in the Ault acquisition which remain unissued ("dilutive securities"), in the number of shares outstanding for our diluted EPS calculations using the treasury method.

Basic and diluted EPS were calculated as follows:


	Three Months Ended March 31,
	2025			2024
Basic net loss per share
Net loss available to common stockholders	$	(21.7	)	$	(12.7	)
Basic weighted average common shares outstanding		33,167,370			33,108,695
Basic net loss per share of common stock	$	(0.65	)	$	(0.38	)
Diluted loss per share
Net loss available to common stockholders	$	(21.7	)	$	(12.7	)
Basic weighted average common shares outstanding		33,167,370			33,108,695
Effect of dilutive securities:
Effect of dilutive securities		—			—
Diluted weighted average common shares outstanding		33,167,370			33,108,695
Diluted net loss per share of common stock	$	(0.65	)	$	(0.38	)

Approximately 795,000 and 1,161,000 securities were excluded from the calculation of diluted loss per share for the three months ended March 31, 2025 and 2024, respectively, because the inclusion of such securities in the calculation would have been anti-dilutive.

NOTE 18 — SUBSEQUENT EVENTS

On May 1, 2025, the Company’s Construction Equipment segment entered into a definitive agreement and closed on the divestiture of substantially all of its aerial fleet rental business in the Chicago, Illinois marketplace for $18.0 million cash at closing, subject to fees and closing costs. The Company plans to allocate the proceeds from the divesture to reduce its outstanding senior indebtedness.

Concurrently, the Company's Board of Directors (the "Board") approved an increase to the Company’s common stock repurchase program authorization from $20.0 million to $30.0 million. As it relates to the deployment of the increased repurchase program, the Board also approved the immediate allocation of $10.0 million to a Rule 10b5-1 Plan (the “Rule 10b5-1 Plan”), whereby the Company directs a fiduciary to purchase the Company’s common stock at pre-determined price intervals. During the term of the Rule 10b5-1 Plan the fiduciary is permitted to purchase the Company’s common stock irrespective of reporting blackout periods or privileged information restrictions. This increase in the stock repurchase program, and the Rule 10b5-1 Plan associated thereto, is to effectively repurpose the capital that was historically being paid out to shareholders as a regular quarterly common stock dividend. To that end, the Board suspended the Company's quarterly cash dividend on its common stock indefinitely after the payment of the dividend on May 30, 2025, to shareholders of record at the close of business on May 15, 2025.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with our interim unaudited condensed consolidated financial statements and related notes included in Item 1 of Part I of this Quarterly Report, and the audited consolidated financial statements and related notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. This discussion contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 reflecting Alta’s current expectations, estimates and assumptions concerning events and financial trends that may affect our future operating results or financial position. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors. Factors that could cause or contribute to such differences include, but are not limited to, economic and competitive conditions, regulatory changes and other uncertainties, as well as those factors discussed below and elsewhere in this Quarterly Report on Form 10-Q, particularly in “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. Alta assumes no obligation to update any of these forward-looking statements.

Business Description

We own and operate one of the largest integrated equipment dealership platforms in North America. Through our branch network, we sell, rent, and provide parts and service support for several categories of specialized equipment, including lift trucks and other material handling equipment, heavy and compact earthmoving equipment, crushing and screening equipment, environmental processing equipment, cranes and aerial work platforms, paving and asphalt equipment, other construction equipment and related products. We engage in five principal business activities in these equipment categories:

(i)

new and used equipment sales;

(ii)

parts sales;

(iii)

repair and maintenance services;

(iv)

equipment rentals; and

(v)

rental equipment sales.

We have operated as an equipment dealership for 41 years and have developed a branch network that includes over 85 total locations in Michigan, Illinois, Indiana, Ohio, Pennsylvania, Massachusetts, Maine, Connecticut, New Hampshire, Vermont, Rhode Island, New York, Virginia, Nevada and Florida and the Canadian provinces of Ontario and Quebec. We offer our customers end-to-end solutions for their equipment needs by providing sales, parts, service and rental offerings. Additionally, we provide warehouse design and build services related to automated equipment installation and warehouse management system integration solutions within our Material Handling segment.

Within our territories, we are primarily the exclusive distributor of new equipment and replacement parts on behalf of our OEM partners. We and our regional subsidiaries enjoy long-standing relationships with leading material handling and construction equipment OEMs including Hyster-Yale, Volvo, JCB, CNH, Takeuchi, McCloskey, and Kubota, among many others, as well as master dealer rights throughout North America for environmental processing equipment with Doppstadt and Backers, among others. We are consistently recognized by OEMs as a top dealership partner and have been identified as an internationally recognized Hyster-Yale dealer and are a multi-year recipient of the Volvo Dealer of the Year award. More recently, given the Company’s successful history with electrified forklifts, battery charging, and power generation, we are pursuing a synergistic, asset-light strategy focused on the distribution and powering of commercial electric vehicles in the over-the-road vehicle segment. While our electromobility (“e-mobility”) business, and the industry in general, is in its early stages of development, we believe that our expertise in this emerging market represents a future growth opportunity.

We are committed to providing our customers with a best-in-class equipment dealership experience. Our customers are principally focused on equipment reliability and uptime, and our teams of skilled technicians and commitment to service are key to establishing and maintaining long-term customer relationships, representing a critical competitive advantage for the Company. Parts and service are also our most predictable and profitable businesses, with the dealership model structured to drive aftermarket parts and service revenues. Through our new and used equipment sales and our sale of lightly used rental fleet, we populate our exclusive territories with serviceable equipment. As the field population ages, we capitalize on aftermarket parts and service sales through the equipment maintenance cycle.

Growth Strategy

Our growth strategy is multifaceted and historically has been primarily predicated on making strategic acquisitions that expand our geographic reach, broaden our capabilities and service offerings, and diversify our customer and supplier bases. We believe these acquisitions, both immediately and over the long term, will be accretive to our financial performance.

In addition to strategic acquisitions, we intend to leverage our platform, deep roster of existing customers, and decades of equipment dealership experience to grow organically, and potentially geographically, by establishing new relationships with equipment OEMs that are synergistic to our existing business.

Business Segments

For a detailed description of our business segments, refer to Note 16, Segments.

Financial Statement Overview

Our revenues are primarily derived from the sale or rental of equipment and product support (e.g., parts and service) related activities, and consist of:

New equipment sales. We sell new heavy construction, material handling and environmental processing equipment and are a leading regional distributor for nationally recognized equipment manufacturers. Our new equipment sales operation is a primary source of new customers for our rental, parts and service business. The majority of our new equipment sales are predicated on exclusive distribution agreements we have with best-in-class OEMs. The sale of new equipment to customers, while profitable from a gross margin perspective, acts as a means of generating equipment field population and activity for our higher-margin aftermarket revenue streams, specifically service and parts. We also sell tangential products and services related to our material handling equipment offerings which include, but are not limited to, automated equipment installation and warehouse management systems integration.

Used equipment sales. We sell used equipment which is typically equipment that has been taken in on trade from a customer that is purchasing new equipment, equipment coming off a third-party lease arrangement where we purchase the equipment from the finance company or used equipment that is sourced for our customers in the open market by our used equipment specialists. Used equipment sales in our territories, like new equipment sales, generate parts and service business for the Company.

Parts sales. We sell replacement parts to customers and supply parts to our own rental fleet. Our in-house parts inventory is extensive such that we are able to provide timely service support to our customers. The majority of our parts inventory is made up of OEM replacement parts for those OEMs with which we have exclusive agreements to sell new equipment.

Service revenues. We provide maintenance and repair services for customer-owned equipment. In addition to repair and maintenance on an as needed or scheduled basis, we provide ongoing preventative maintenance services and warranty repairs for our customers. We have committed substantial resources to training our technical service employees and have a full-scale service infrastructure that we believe differentiates us from our competitors. Approximately 44% of our employees are skilled service technicians.

Rental revenues. We rent heavy construction, compact, aerial, material handling, and a variety of other types of equipment to our customers on a daily, weekly, and monthly basis. Our rental fleet, which is well-maintained, has an original acquisition cost (which we define as the cost originally paid to manufacturers plus any capitalized costs) of $579.0 million as of March 31, 2025. The original acquisition cost of our rental fleet excludes $5.1 million of assets associated with our guaranteed purchase obligations, which are assets that are not in our day-to-day operational control. In addition to being a core business, our rental business also creates cross-selling opportunities for us in our equipment sales and product support activities.

Rental equipment sales. We also sell rental equipment from our rental fleet. Rental equipment sales may occur at various stages in an equipment’s lifecycle, depending on customer demand and original purchase intentions of the equipment. Rental equipment purchased directly into the rental fleet tends to be rented for the majority of its useful life before being sold (which we refer as rent-to-rent equipment), and rental equipment purchased as new inventory then later transferred into the rental fleet tends to be rented until a retail opportunity presents itself (which we refer as rent-to-sell equipment). In our Material Handling segment, our rental equipment sales are primarily of rent-to-rent equipment and in our Construction Equipment segment, our rental equipment sales are primarily of rent-to-sell equipment. Selling lightly used construction equipment from our rental fleet allows us to meet customer demand for specific model years of equipment at various price points versus only offering brand new equipment to the market. Customers often have options to purchase equipment after or before rental agreements have matured. Rental equipment sales, like new and used equipment sales, generate customer-owned equipment field population within our territories that ultimately yield high-margin parts and service revenues for us.

Principal Costs and Expenses

Our cost of revenues are primarily related to the costs associated with the sale or rental of equipment and product support activities, which include direct labor costs for our skilled technicians. Our operating expenses consist principally of selling, general and administrative expenses, which primarily include personnel costs associated with our sales and administrative staff and expenses associated with the deployment of our service vehicle fleet and occupancy expenses. In addition, we have interest expense related to our floor plan payables, finance leases, line of credit, and senior secured second lien notes. These principal costs and expenses are described further below:

New equipment sales. Cost of new equipment sold primarily consists of the total acquisition costs of the new equipment we purchase from third parties and costs to inspect, prepare and deliver to the customer.

Used equipment sales. Cost of used equipment sold primarily consists of the net book value, or cost, of used equipment we purchase from third parties or the trade-in value of used equipment that we obtain from customers in new equipment sales transactions combined with our inspection, preparation and delivery costs to sell to the customer.

Parts sales. Cost of parts sales represents the average cost of parts used in the maintenance and repair of customer-owned equipment we service or parts sold directly to customers for their owned equipment (e.g., over-the-counter parts sales).

Services revenues. Cost of service revenues primarily represents the labor costs attributable to services provided for the maintenance and repair of customer-owned equipment. Training, paid time off, and other non-billable costs of maintaining our expert technicians are recorded in this line item in addition to the costs of direct customer-billable labor.

Rental revenues. Rental expense represents the costs associated with rental equipment, including, among other things, the cost of repairing and maintaining our rental equipment and other miscellaneous costs of owning rental equipment. Other rental expenses consist primarily of equipment support activities that we provide our customers in connection with renting equipment, such as freight services and damage waiver policies.

Rental depreciation. Depreciation of rental equipment represents the depreciation costs attributable to rental equipment. Estimated useful lives vary based upon type of equipment. See Note 2, Summary of Significant Accounting Policies, of the consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2024 for information on our rental equipment depreciation methods.

Rental equipment sales. Cost of previously rented equipment sold consists of the net book value (e.g., net of accumulated depreciation) of rental equipment sold from our rental fleet.

Operating expenses. These costs are comprised of three main components: personnel, operational, and occupancy costs. Personnel costs are comprised of hourly and salaried wages for administrative employees, including incentive compensation, sale commissions, and employee benefits, such as medical benefits. Operational costs include marketing activities, costs associated with deploying and leasing our service vehicle fleet, insurance, information technology, office and shop supplies, general corporate costs, depreciation on non-sales and rental related assets, and intangible amortization. Occupancy costs are comprised of all expenses related to our facility infrastructure, including rent, utilities, property taxes, and building insurance.

Other expense, net. This section of the Consolidated Statements of Operations is mostly comprised of interest expense and other miscellaneous items that result in income or expense. Interest expense is driven by our floor plan facilities, line of credit, senior secured second lien notes, and finance lease arrangements.

Results of Operations

The three months ended March 31, 2025 and 2024

Consolidated Results


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Revenues:
New and used equipment sales	$	221.7		$	228.6		$	(6.9	)		(3.0	)%
Parts sales		72.0			72.9			(0.9	)		(1.2	)%
Service revenues		66.1			64.0			2.1			3.3	%
Rental revenues		42.3			48.5			(6.2	)		(12.8	)%
Rental equipment sales		20.9			27.6			(6.7	)		(24.3	)%
Total revenues		423.0			441.6			(18.6	)		(4.2	)%
Cost of revenues:
New and used equipment sales		188.1			192.4			(4.3	)		(2.2	)%
Parts sales		47.6			48.3			(0.7	)		(1.4	)%
Service revenues		26.4			27.0			(0.6	)		(2.2	)%
Rental revenues		5.0			6.7			(1.7	)		(25.4	)%
Rental depreciation		24.9			27.1			(2.2	)		(8.1	)%
Rental equipment sales		16.0			19.5			(3.5	)		(17.9	)%
Total cost of revenues		308.0			321.0			(13.0	)		(4.0	)%
Gross profit		115.0			120.6			(5.6	)		(4.6	)%
Selling, general and administrative expenses		106.7			114.6			(7.9	)		(6.9	)%
Non-rental depreciation and amortization		7.5			6.9			0.6			8.7	%
Total operating expenses		114.2			121.5			(7.3	)		(6.0	)%
Income (loss) from operations		0.8			(0.9	)		1.7			(188.9	)%
Other (expense) income:
Interest expense, floor plan payable – new equipment		(3.2	)		(2.8	)		(0.4	)		14.3	%
Interest expense – other		(18.7	)		(13.3	)		(5.4	)		40.6	%
Other income		0.9			0.9			—			—
Total other expense, net		(21.0	)		(15.2	)		(5.8	)		38.2	%
Loss before taxes		(20.2	)		(16.1	)		(4.1	)	NM
Income tax provision (benefit)		0.7			(4.2	)		4.9		NM
Net loss		(20.9	)		(11.9	)		(9.0	)	NM
Preferred stock dividends		(0.8	)		(0.8	)		—			—
Net loss available to common stockholders	$	(21.7	)	$	(12.7	)	$	(9.0	)	NM
Adjusted EBITDA(1)	$	33.6		$	34.1		$	(0.5	)		(1.5	)%
NM - calculated change not meaningful
(1) Adjusted EBITDA is a non-GAAP measure. Refer to “Non-GAAP Financial Measures” for a definition of Adjusted EBITDA and below for a reconciliation of our Adjusted EBITDA to net loss, the most comparable U.S. GAAP measure.


	Percent of Revenues
	Three Months Ended March 31,
	2025			2024
Revenues:
New and used equipment sales		52.5	%		51.8	%
Parts sales		17.0	%		16.4	%
Service revenues		15.6	%		14.5	%
Rental revenues		10.0	%		11.0	%
Rental equipment sales		4.9	%		6.3	%
Total revenues		100.0	%		100.0	%
Cost of revenues:
New and used equipment sales		44.4	%		43.6	%
Parts sales		11.3	%		10.9	%
Service revenues		6.2	%		6.1	%
Rental revenues		1.2	%		1.6	%
Rental depreciation		5.9	%		6.1	%
Rental equipment sales		3.8	%		4.4	%
Total cost of revenues		72.8	%		72.7	%
Gross profit		27.2	%		27.3	%

Non-GAAP Financial Measures:

Adjusted EBITDA


	Adjusted EBITDA
	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Net loss available to common stockholders	$	(21.7	)	$	(12.7	)	$	(9.0	)	NM
Depreciation and amortization		32.4			34.0			(1.6	)		(4.7	)%
Interest expense		21.9			16.1			5.8			36.0	%
Income tax provision (benefit)		0.7			(4.2	)		4.9		NM
Transaction and consulting costs		0.1			0.2			(0.1	)	NM
Share-based incentives		1.1			1.3			(0.2	)		(15.4	)%
Other expenses		1.5			1.4			0.1		NM
Preferred stock dividend		0.8			0.8			—			—
Showroom-ready equipment interest expense		(3.2	)		(2.8	)		(0.4	)		14.3	%
Adjusted EBITDA	$	33.6		$	34.1		$	(0.5	)		(1.5	)%
NM - calculated change not meaningful

Organic Revenues


	Organic Revenues
	Three Months Ended March 31,				Increase (Decrease)
	2025		2024		2025 versus 2024
Total revenues	$	423.0	$	441.6	$	(18.6	)	(4.2	)%
Acquisitions revenues		—		—
Organic revenues:
New and used equipment sales		221.7		228.6		(6.9	)	(3.0	)%
Parts sales		72.0		72.9		(0.9	)	(1.2	)%
Service revenues		66.1		64.0		2.1		3.3	%
Rental revenues		42.3		48.5		(6.2	)	(12.8	)%
Rental equipment sales		20.9		27.6		(6.7	)	(24.3	)%
Total organic revenues	$	423.0	$	441.6	$	(18.6	)	(4.2	)%

The above tables contain non-GAAP financial measures. A “non-GAAP financial measure” is defined as a numerical measure of a company’s financial performance that excludes or includes amounts in the most directly comparable measure calculated and presented in accordance with GAAP in the condensed consolidated statements of operations, balance sheets or statements of cash flows of the company. We disclose non-GAAP financial measures, including Adjusted EBITDA and organic revenues and growth rates associated with organic revenues because we believe they are useful performance measures that assist in an effective evaluation of our operating performance. We believe such measures are useful for investors and others in understanding and evaluating our operating results in the same manner as our management. However, such measures are not financial measures calculated in accordance with U.S. GAAP and should not be considered as a substitute for, or in isolation from, net income (loss), revenues, or any other operating performance measures calculated in accordance with U.S. GAAP.

We define Adjusted EBITDA as net income (loss) before interest expense (not including floor plan interest paid on new equipment), income taxes, depreciation and amortization, adjustments for certain one-time, non-recurring or non-cash items, and items not necessarily indicative of our underlying operating performance. We exclude these items from net income (loss) in arriving at Adjusted EBITDA because these amounts are either non-cash, non-recurring or can vary substantially within the industry depending upon accounting methods and book values of assets, capital structures, and the method by which the assets were acquired.

We define organic revenue growth as revenue growth excluding the impact of acquisitions that do not appear fully in both periods in the current and prior years. We believe organic revenue growth is a meaningful metric to investors as it provides a more consistent comparison of our revenues to prior periods as well as to industry peers.

Pursuant to the requirements of Regulation G, we have provided a reconciliation of Adjusted EBITDA and organic revenues to the most directly comparable U.S. GAAP financial measure in the tables above and organic revenues in the subsequent table in management's discussion and analysis of our Material Handling segment. This measure is supplemental to, and should be used in conjunction with, the most comparable U.S. GAAP measures. Management uses these non-GAAP financial measures to monitor and evaluate financial results and trends.

Revenues: In the three months ended March 31, 2025, organic new and used equipment revenues decreased 3.0% against the three months ended March 31, 2024 due primarily to reduced customer deliveries of new lift trucks in the first quarter when compared to the same period last year, as industry deliveries of lift trucks has normalized off of peak post-Covid levels. This led to a $16.4 million, or 9.4%, reduction in revenues in our Material Handling segment for the three months ended March 31, 2025. First quarter sales volumes were further impacted by elevated sales activity in the fourth quarter of 2024, which pulled some demand forward, especially as it related to rental equipment sales in our Construction Equipment segment. Despite slowed new and used equipment revenues, our product support departments (parts and service) continued to exhibit resiliency and grew 0.9% organically for the three months ended March 31, 2025. Rental revenues for the three months ended March 31, 2025 declined 12.8% organically due to lower nominal fleet levels and decreased fleet on rent when compared to the same period last year. Rental equipment sales organically decreased 24.3% for the three months ended March 31, 2025 as compared to the same period last year. As mentioned, this reduction was predominantly evident in our rent-to-sell product categories in our Construction Equipment segment as increased demand in the fourth quarter of 2024 pulled forward rental equipment sales activities, resulting in a lower rent-to-sell equipment fleet level relative to the prior year and thus fewer rental equipment sales opportunities.

Gross profit (GP):


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Consolidated	GP%			GP%			GP%
New and used equipment sales		15.2	%		15.8	%		(0.6	)%
Parts sales		33.9	%		33.7	%		0.2	%
Service revenues		60.1	%		57.8	%		2.3	%
Rental revenues		29.3	%		30.3	%		(1.0	)%
Rental equipment sales		23.4	%		29.3	%		(5.9	)%

Consolidated gross profit		27.2	%		27.3	%		(0.1	)%

The consolidated gross profit margin for the three months ended March 31, 2025 was 27.2%, a 10 basis point decrease from 27.3% for the same period in 2024. New and used equipment sales margins decreased 60 basis points to 15.2%, a reflection of a competitive but stabilizing, pricing environment and overall sales mix influences. For sales of our rental equipment, gross margin was also compressed on a softened pricing environment for used equipment when compared to the same period last year, posting a 590 basis point decrease when comparing the year-over-year periods. Parts gross margins improved 20 basis points year to date when compared to the same time last year primarily due to mix but aligned to expectations overall. Service gross margins improved by 230 basis points. The improvement in year-to-date service gross margins was largely attributable to improved rate realization on customer service work, improved efficiency measures, and improved margins on OEM warranty and fleet work. We realized a 100 basis point decrease in rental revenues gross margin for the three months ended March 31, 2025, primarily due to a greater proportion of rental revenues coming from the Construction Equipment segment.

Operating expenses: Consolidated operating expenses decreased by $7.3 million to $114.2 million for the three months ended March 31, 2025 compared to the same period last year. The decrease is primarily due to cost savings initiatives implemented during the second half of 2024, primarily impacting the Company's personnel expense, with an overall headcount reduction of over 6.0%.

Other expense, net: Consolidated other expense, net for the three months ended March 31, 2025 was $21.0 million compared to $15.2 million for the same period in 2024. The increase is primarily due to the refinance of debt in the second quarter of 2024, resulting in an increased amount of interest expense from the higher interest rate affixed to the refinanced debt.

Income tax provision (benefit): The Company recorded income tax expense of $0.7 million and benefit of $4.2 million for the three months ended March 31, 2025 and 2024, respectively. The income tax expense for the three months ended March 31, 2025 was primarily a result of a change in valuation allowance recorded against a portion of the deferred tax asset relating to the U.S. disallowed interest expense carryforwards partially offset by the benefit attributable to the net loss for the period and the benefit in 2024 was due to net tax losses during the quarter.

Material Handling Results


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Revenues:
New and used equipment sales	$	78.4		$	94.1		$	(15.7	)	(16.7	)%
Parts sales		24.3			24.9			(0.6	)	(2.4	)%
Service revenues		34.1			33.8			0.3		0.9	%
Rental revenues		17.6			19.0			(1.4	)	(7.4	)%
Rental equipment sales		3.5			2.5			1.0		40.0	%
Total revenues		157.9			174.3			(16.4	)	(9.4	)%
Cost of revenues:
New and used equipment sales		63.1			76.3			(13.2	)	(17.3	)%
Parts sales		15.3			15.5			(0.2	)	(1.3	)%
Service revenues		13.3			14.1			(0.8	)	(5.7	)%
Rental revenues		1.0			2.7			(1.7	)	(63.0	)%
Rental depreciation		8.1			7.5			0.6		8.0	%
Rental equipment sales		2.5			1.5			1.0		66.7	%
Total cost of revenues		103.3			117.6			(14.3	)	(12.2	)%
Gross profit		54.6			56.7			(2.1	)	(3.7	)%
Selling, general and administrative expenses		46.5			48.9			(2.4	)	(4.9	)%
Non-rental depreciation and amortization		2.5			2.2			0.3		13.6	%
Total operating expenses		49.0			51.1			(2.1	)	(4.1	)%
Income from operations		5.6			5.6			—		—
Other (expense) income:
Interest expense, floor plan payable – new equipment		(0.8	)		(0.9	)		0.1		(11.1	)%
Interest expense – other		(5.5	)		(4.2	)		(1.3	)	31.0	%
Other income		0.1			0.1			—		—
Total other expense, net		(6.2	)		(5.0	)		(1.2	)	24.0	%
(Loss) income before taxes	$	(0.6	)	$	0.6		$	(1.2	)	(200.0	)%
Segment adjusted EBITDA	$	15.6		$	14.5		$	1.1		7.6	%


	Percent of Revenues
	Three Months Ended March 31,
	2025			2024
Revenues:
New and used equipment sales		49.7	%		54.0	%
Parts sales		15.4	%		14.3	%
Service revenues		21.6	%		19.4	%
Rental revenues		11.1	%		10.9	%
Rental equipment sales		2.2	%		1.4	%
Total revenues		100.0	%		100.0	%
Cost of revenues:
New and used equipment sales		40.0	%		43.8	%
Parts sales		9.7	%		8.9	%
Service revenues		8.4	%		8.1	%
Rental revenues		0.6	%		1.5	%
Rental depreciation		5.1	%		4.3	%
Rental equipment sales		1.6	%		0.9	%
Total cost of revenues		65.4	%		67.5	%
Gross profit		34.6	%		32.5	%

Non-GAAP Financial Measure: Organic Revenues


	Organic Revenues
	Three Months Ended March 31,				Increase (Decrease)
	2025		2024		2025 versus 2024
Total revenues	$	157.9	$	174.3	$	(16.4	)	(9.4	)%
Acquisitions revenues		—		—
Organic revenues:
New and used equipment sales		78.4		94.1		(15.7	)	(16.7	)%
Parts sales		24.3		24.9		(0.6	)	(2.4	)%
Service revenues		34.1		33.8		0.3		0.9	%
Rental revenues		17.6		19.0		(1.4	)	(7.4	)%
Rental equipment sales		3.5		2.5		1.0		40.0	%
Total organic revenues	$	157.9	$	174.3	$	(16.4	)	(9.4	)%

Revenues: Material Handling segment revenues decreased by $16.4 million, or 9.4%, to $157.9 million for the three months ended March 31, 2025 as compared to the same period last year. Organic sales of new and used equipment fell by 16.7% year over year, primarily due to industry deliveries of lift trucks normalizing off of peak post-Covid levels. On an organic basis, product support revenues, made up of the combined parts and service departments, remained relatively flat, reflecting stable performance despite lower relative volume particularly experienced in parts sales during the quarter. Rental revenues decreased $1.4 million organically for the three months ended March 31, 2025 as compared to the same period last year driven by a lower average volume of fleet on rent. In contrast, rental equipment sales rose by $1.0 million organically, or 40.0%, on low volume driven by the strategic disposal of primarily underutilized equipment nearing the end of its useful life.

Gross profit (GP):


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
	GP%			GP%			GP%
New and used equipment sales		19.5	%		18.9	%		0.6	%
Parts sales		37.0	%		37.8	%		(0.8	)%
Service revenues		61.0	%		58.3	%		2.7	%
Rental revenues		48.3	%		46.3	%		2.0	%
Rental equipment sales		28.6	%		40.0	%		(11.4	)%

Segment gross profit		34.6	%		32.5	%		2.1	%

Material Handling gross profit for the three months ended March 31, 2025 increased 210 basis points to 34.6% compared to the same period in 2024. Despite lower volumes, new and used equipment gross margins increased slightly due to sales mix variances but align within the range of historical expectations. Parts gross margins have remained relatively consistent year over year and in line with expectations. The 270 basis point service margin increase for the three months ended March 31, 2025 compared to the prior year period can be attributed to margin improvements in major service categories, customer and OEM warranty and fleet work, on better pricing, and technician productivity measures. Rental revenues gross margins have increased 200 basis points primarily due to fewer subrental costs and improved repair and maintenance costs. Rental equipment sales margins decreased on low volume of sales driven by the strategic disposal of primarily underutilized equipment nearing the end of its useful life.

Operating expenses: Material Handling operating expenses decreased by $2.1 million to $49.0 million for the three months ended March 31, 2025 as compared to the same period last year, mainly due to cost saving initiatives implemented during the second half of 2024 which primarily impacted personnel expenses, resulting in a reduction in average headcount of nearly 6.0% compared to the same quarter in the prior year.

Other expense, net: Material Handling other expense, net increased by $1.2 million to $6.2 million for the three months ended March 31, 2025 as compared to the same period last year. The increase is mainly related to increased interest expense due to higher nominal levels of debt and the increase in our effective interest rate after our debt refinancing in 2024.

Construction Equipment Results


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Revenues:
New and used equipment sales	$	126.7		$	126.1		$	0.6		0.5	%
Parts sales		45.3			45.9			(0.6	)	(1.3	)%
Service revenues		31.8			30.1			1.7		5.6	%
Rental revenues		24.6			29.1			(4.5	)	(15.5	)%
Rental equipment sales		17.4			24.4			(7.0	)	(28.7	)%
Total revenues		245.8			255.6			(9.8	)	(3.8	)%
Cost of revenues:
New and used equipment sales		112.3			110.0			2.3		2.1	%
Parts sales		30.9			31.7			(0.8	)	(2.5	)%
Service revenues		12.6			12.8			(0.2	)	(1.6	)%
Rental revenues		4.0			4.0			—		—
Rental depreciation		16.6			19.2			(2.6	)	(13.5	)%
Rental equipment sales		13.5			17.6			(4.1	)	(23.3	)%
Total cost of revenues		189.9			195.3			(5.4	)	(2.8	)%
Gross profit		55.9			60.3			(4.4	)	(7.3	)%
Selling, general and administrative expenses		54.6			57.2			(2.6	)	(4.5	)%
Non-rental depreciation and amortization		4.0			3.7			0.3		8.1	%
Total operating expenses		58.6			60.9			(2.3	)	(3.8	)%
Loss from operations		(2.7	)		(0.6	)		(2.1	)	350.0	%
Other (expense) income:
Interest expense, floor plan payable – new equipment		(2.1	)		(1.6	)		(0.5	)	31.3	%
Interest expense – other		(10.7	)		(8.2	)		(2.5	)	30.5	%
Other income		0.4			0.4			—		—
Total other expense, net		(12.4	)		(9.4	)		(3.0	)	31.9	%
Loss before taxes	$	(15.1	)	$	(10.0	)	$	(5.1	)	51.0	%
Segment adjusted EBITDA	$	17.0		$	21.3		$	(4.3	)	(20.2	)%


	Percent of Revenues
	Three Months Ended March 31,
	2025			2024
Revenues:
New and used equipment sales		51.6	%		49.3	%
Parts sales		18.4	%		18.0	%
Service revenues		12.9	%		11.8	%
Rental revenues		10.0	%		11.4	%
Rental equipment sales		7.1	%		9.5	%
Total revenues		100.0	%		100.0	%
Cost of revenues:
New and used equipment sales		45.7	%		43.0	%
Parts sales		12.6	%		12.4	%
Service revenues		5.1	%		5.0	%
Rental revenues		1.6	%		1.6	%
Rental depreciation		6.8	%		7.5	%
Rental equipment sales		5.5	%		6.9	%
Total cost of revenues		77.3	%		76.4	%
Gross profit		22.7	%		23.6	%

Revenues: Construction Equipment segment revenues decreased by $9.8 million, or 3.8%, to $245.8 million for the three months ended March 31, 2025 as compared to the same period last year. New and used equipment sales remained consistent with the prior year quarter, with new sales volumes improved but used sales volumes reduced. Rental equipment sales decreased for the three months ended March 31, 2025 by $7.0 million as demand in the fourth quarter of 2024 pulled forward sales activities, resulting in a lowered rent-to-sell equipment fleet level relative to the prior year quarter and therefore fewer rental equipment sales opportunities in the first quarter. Product support revenues increased 1.4% due to improved rates and utilization on service labor. Rental revenues decreased $4.5 million for the three months ended March 31, 2025 compared to the same period last year, primarily the result of a purposely lower level of rent-to-sell fleet available for rent. Average rental fleet available throughout the three months ended March 31, 2025 was nearly $40.0 million less than the same period last year, as the Company’s rent-to-sell fleet (and rental revenue related thereto) flexes with customer demand for light used heavy construction equipment.

Gross profit (GP):


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
	GP%			GP%			GP%
New and used equipment sales		11.4	%		12.8	%		(1.4	)%
Parts sales		31.8	%		30.9	%		0.9	%
Service revenues		60.4	%		57.5	%		2.9	%
Rental revenues		16.3	%		20.3	%		(4.0	)%
Rental equipment sales		22.4	%		27.9	%		(5.5	)%

Segment gross profit		22.7	%		23.6	%		(0.9	)%

Construction Equipment gross profit decreased by 90 basis points to 22.7% in the three months ended March 31, 2025 from 23.6% in the same period in 2024. New and used equipment sales margins decreased 140 basis points to 11.4%. Although new equipment volumes were higher compared to the prior year, competitive pricing and the higher cost of new equipment led to lower margin realization. Conversely, despite a challenged used equipment market year-over-year and lower sales volumes, used equipment margins improved year over year on retail sales within the dealership. Parts sales margins for the three months ended March 31, 2025 increased 90 basis points when compared to the same time last year on pricing realization on over the counter sales and as freight cost recovery showed improvement. Service gross margins increased by 290 basis points year over year mainly from improved rate realization and efficiency measures along with improved warranty recovery. Rental revenues gross margin for the three months ended March 31, 2025 decreased 400 basis points from a year ago, a result of the lowered amount of fleet on rent and the relative impact of repair and maintenance charges contained within cost of revenues, as our technicians prepare our fleet for the seasonal increase in demand for rental equipment in our northern regions in the upcoming quarters. Gross margins on rental equipment sales for the three months ended March 31, 2025 were reduced from a year ago amid higher relative costs of equipment in our rental fleet and reduced market prices on used equipment year over year.

Operating expenses: Construction Equipment operating expenses decreased by $2.3 million to $58.6 million for the three months ended March 31, 2025 as compared to the same period in 2024. The decrease was primarily attributable to cost-saving measures implemented in the second half of 2024, including a reduction in average headcount of nearly 7.0% compared to the same quarter in the prior year, which significantly lowered personnel expenses. In addition, enhanced controls on, and consolidation of, certain operating expenses contributed to approximately another $0.5 million in savings during the quarter beyond the personnel cost reduction.

Other expense, net: Construction Equipment other expense, net increased by $3.0 million to $12.4 million for the three months ended March 31, 2025 as compared to the same period in 2024. The variance was driven by increased interest expense primarily due to the increase in our effective interest rate after our debt refinancing in 2024.

Master Distribution Results


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
Revenues:
New and used equipment sales	$	14.8		$	9.1		$	5.7			62.6	%
Parts sales		2.4			2.5			(0.1	)		(4.0	)%
Service revenues		0.2			0.1			0.1			100.0	%
Rental revenues		—			0.4			(0.4	)	NA
Rental equipment sales		—			0.7			(0.7	)	NA
Total revenues		17.4			12.8			4.6			35.9	%
Cost of revenues:
New and used equipment sales		11.0			6.8			4.2			61.8	%
Parts sales		1.4			1.5			(0.1	)		(6.7	)%
Service revenues		0.5			0.1			0.4			400.0	%
Rental depreciation		—			0.2			(0.2	)	NA
Rental equipment sales		—			0.4			(0.4	)	NA
Total cost of revenues		12.9			9.0			3.9			43.3	%
Gross profit		4.5			3.8			0.7			18.4	%
Selling, general and administrative expenses		2.5			4.0			(1.5	)		(37.5	)%
Non-rental depreciation and amortization		0.9			0.9			—			—
Total operating expenses		3.4			4.9			(1.5	)		(30.6	)%
Income (loss) from operations		1.1			(1.1	)		2.2			(200.0	)%
Other (expense) income:
Interest expense, floor plan payable – new equipment		(0.3	)		(0.3	)		—			—
Interest expense – other		(1.1	)		(0.6	)		(0.5	)		83.3	%
Other expense		(0.2	)		—			(0.2	)		—
Total other expense, net		(1.6	)		(0.9	)		(0.7	)		77.8	%
Loss before taxes	$	(0.5	)	$	(2.0	)	$	1.5			(75.0	)%
Segment adjusted EBITDA	$	1.5		$	0.9		$	0.6			66.7	%


	Percent of Revenues
	Three Months Ended March 31,
	2025			2024
Revenues:
New and used equipment sales		85.1	%		71.1	%
Parts sales		13.8	%		19.5	%
Service revenues		1.1	%		0.8	%
Rental revenues		—			3.1	%
Rental equipment sales		—			5.5	%
Total revenues		100.0	%		100.0	%
Cost of revenues:
New and used equipment sales		63.2	%		53.1	%
Parts sales		8.0	%		11.7	%
Service revenues		2.9	%		0.8	%
Rental depreciation		—			1.6	%
Rental equipment sales		—			3.1	%
Total cost of revenues		74.1	%		70.3	%
Gross profit		25.9	%		29.7	%

Revenues: Master Distribution segment revenues for the three months ended March 31, 2025 were $17.4 million, an increase of $4.6 million from the prior year same period. As sub-dealer inventory levels normalized from the oversupply experienced in 2024, a greater number of sub-dealers were both willing and able to restock compared to the prior year. Seasonal deliveries in the first quarter aligned more closely with the long-term historical patterns of the segment. In contrast, the unusually low sales in the first quarter of 2024 were primarily driven by widespread dealer oversupply across all equipment classes, not just the products sold through our Master Distribution channel, which reduced dealer acceptance rates on a broader scale. Parts sales, on the other hand, were consistent when compared to the same period last year.

Gross profit (GP):


	Three Months Ended March 31,						Increase (Decrease)
	2025			2024			2025 versus 2024
	GP%			GP%			GP%
New and used equipment sales		25.7	%		25.3	%		0.4	%
Parts sales		41.7	%		40.0	%		1.7	%
Service revenues		(150.0	)%		—		NM
Rental revenues	NA				50.0	%	NA
Rental equipment sales	NA				42.9	%	NA

Segment gross profit		25.9	%		29.7	%		(3.8	)%
NM - calculated change not meaningful

For the three months ended March 31, 2025, gross profit margin decreased 3.8% from prior year primarily due to high-margin rental revenues and rental equipment sales in 2024 which were non-recurring. Gross profit margins on new and used equipment sales were 25.7%, up slightly from prior year and in line with expectations. Parts gross profit margin was 41.7% for the three months ended March 31, 2025, up 170 basis points compared to the same period last year but consistent with expectations overall.

Operating expenses: Master Distribution segment operating expenses were $3.4 million for the three months ended March 31, 2025, a decrease of $1.5 million for the prior year same period. The $1.5 million decrease is primarily reflective of costs incurred in the prior year for non-cash contingent consideration expense associated with the earnout component of the acquisition of Ecoverse in November 2022. Removing the recorded expense of the contingent consideration of $1.2 million provides for relatively flat operating expenses year over year despite a higher revenue base in the current operating period.

Other expense, net: Master Distribution other expense, net was $1.6 million for the three months ended March 31, 2025, an increase over prior year primarily attributed to higher interest costs on larger inventory balances and a greater effective interest rate given the debt refinance in 2024.

Liquidity and Capital Resources

The three months ended March 31, 2025 and 2024 Cash Flows

Cash Flow from Operating Activities. Cash flows from operating activities include net loss adjusted for non-cash items and the effects of changes in working capital. For the three months ended March 31, 2025, operating activities resulted in net cash used in operations of $17.5 million. Our reported net loss of $20.9 million, when adjusted for non-cash income and expense items, primarily depreciation and amortization, the gain on sale of rental equipment, inventory obsolescence and bad debt reserves, deferred income taxes, and stock-based compensation, provided net cash inflows of $9.3 million. Changes in working capital included $41.6 million of inventory purchased ($28.4 million of inventory was transferred into our rental fleet primarily for replenishment purposes) and a $9.1 million increase in accounts receivable. Cash flows from operating activities were favorably impacted by $18.6 million due to proceeds from the sale of rent-to-sell equipment and a $15.4 million increase in accounts payable, accrued expenses, customer deposits, and other current liabilities, partially offset by $6.0 million in net outflows related to manufacturer floor plans, and by a $4.1 million net change in prepaid expenses and other assets and leases, deferred revenue, and other liabilities.

For the three months ended March 31, 2024, operating activities resulted in net cash used in operations of $13.5 million. Our reported net loss of $11.9 million, when adjusted for non-cash income and expense items, primarily depreciation and amortization, the gain on sale of rental equipment, inventory obsolescence and bad debt reserves, and stock-based compensation, provided net cash inflows of $17.8 million. Changes in working capital included $66.3 million of inventory purchased ($38.8 million of inventory was transferred into our rental fleet for replenishment and growth purposes), and an $8.0 million decrease in accounts receivable. Cash flows from operating activities were favorably impacted by $26.0 million due to proceeds from the sale of rent-to-sell equipment, $0.4 million in net inflows related to manufacturer floor plans, and a $5.0 million net change in prepaid expenses and other assets and unfavorably impacted by a $4.4 million decrease in accounts payable, accrued expenses, customer deposits, and other current liabilities and leases, deferred revenue, net of current portion and other liabilities.

Cash Flow from Investing Activities. For the three months ended March 31, 2025, our cash used in investing activities was $14.3 million. This was mainly due to $16.8 million purchases of rental equipment and non-rental property and equipment, the acquisition of CEQ as discussed in Note 15, Business Combinations, and other investing activities, partially offset by $2.3 million proceeds from the sale of rent-to-rent equipment and $0.2 million proceeds from the sale of non-rental property and equipment.

For the three months ended March 31, 2024, our cash used in investing activities was $16.5 million. This was mainly due to $18.2 million purchases of rental equipment and non-rental property and equipment, and other investing activities partially offset by $1.6 million proceeds from the sale of rent-to-rent equipment and $0.1 million proceeds from the sale of non-rental property and equipment.

Cash Flow from Financing Activities. For the three months ended March 31, 2025, cash provided by financing activities was $29.5 million. This cash inflow was mainly due to the $34.5 million of net proceeds from our line of credit, long-term borrowings, and finance lease obligations, which funded the increase in net working capital previously noted. These cash inflows were partially offset by payments of $2.7 million for preferred and common stock dividends, net payments of $1.5 million related to non-manufacturer floor plans, and $0.8 million related to other financing activities.

For the three months ended March 31, 2024, cash provided by financing activities was $4.6 million. This cash inflow was mainly due to $10.9 million of net borrowings under our line of credit which funded the increase in net working capital previously noted. Additionally, there were net borrowings of $1.9 million related to non-manufacturer floor plans. These cash inflows were partially offset by payments of $2.7 million for preferred and common stock dividends and $5.5 million related to other financing activities.

Sources of Liquidity

Our principal sources of liquidity have been from cash provided by our service, parts and rental related operations and the sales of new, used, and rental fleet equipment, proceeds from the issuance of debt, and borrowings available under our line of credit and floor plans. The Company also reported $11.1 million in cash as of March 31, 2025. For more information on our available borrowings under the revolving line of credit, senior secured second lien notes, and floor plans, please refer to Note 8, Floor Plans and Note 9, Long-term Debt. We consider the undistributed earnings of our foreign subsidiaries to be indefinitely reinvested as we do not anticipate the need to repatriate funds to the U.S. to satisfy domestic liquidity needs.

Cash Requirements Related to Operations

Our principal uses of cash have been to fund operating activities and working capital, including but not limited to new and used equipment inventories, purchases of rental fleet equipment and personal property, payments due under line of credit and floor plans, acquisitions, debt service requirements, stock repurchases, and preferred stock and common stock dividends. In the future, we may pursue additional strategic acquisitions and seek to open new start-up locations. We anticipate that the uses described above encompass the principal demands on our cash and availability under our line of credit and floor plans in the future.

The amount of our future capital expenditures will depend on a number of factors including general economic conditions and our growth prospects. Our gross rental fleet capital expenditures for the three months ended March 31, 2025 was $40.4 million, including $28.4 million of transfers from new and used inventory to rental fleet. This gross rental fleet capital expenditure was offset by sales proceeds from rental equipment of $20.9 million for the three months ended March 31, 2025 as our business model is to sell lightly used inventory to customers from our rental fleet to increase field population in our geographies. In response to changing economic conditions, we have the flexibility to modify our capital expenditures, especially as it relates to rental fleet.

To service our debt, we will require a significant amount of cash. Our ability to pay interest and principal on our indebtedness, will depend upon our future operating performance and the availability of borrowings under the line of credit and/or other debt and equity financing alternatives available to us, which will be affected by prevailing economic conditions and conditions in the global credit and capital markets, as well as financial, business and other factors, some of which are beyond our control. Based on our current level of operations and given the current state of the capital markets, we believe our cash flows from operations, available cash, and available borrowings under the line of credit will be adequate to meet our future liquidity needs for the foreseeable future. As of March 31, 2025, we had $401.6 million of available borrowings under the ABL Facility and Floor Plan Facilities.

Critical Accounting Policies and Estimates

In the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), we are required to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and the related disclosures. Our management reviews these estimates and assumptions on an ongoing basis. While we believe the estimates and judgments we use in preparing our consolidated financial statements are reasonable and appropriate, they are subject to future events and uncertainties regarding their outcome; therefore, actual results may materially differ from these estimates. If actual amounts are ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts first become known. See Note 2 to the consolidated financial statements contained in the Company’s 2024 Annual Report on Form 10-K for a summary of our significant accounting policies.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our exposure to market risks primarily consists of interest rate risk associated with our variable and fixed rate debt, prices of certain commodities, and foreign currency exchange rate risks. From time to time, we employ financial instruments to manage the Company's exposure to changes in interest rates, diesel and unleaded fuel, and foreign currencies. See Note 14, Fair Value of Financial Instruments, for more information.

Interest rate risk: Our earnings may be affected by changes in interest rates on the ABL Facility and Floor Plan Facilities. The interest rates applicable to any loans under the ABL Facility are based, at the option of the borrowers, on (i) a floating rate based on the SOFR (for loans denominated in U.S. dollars) or Canadian Dollar Offered Rate (for loans denominated in Canadian dollars) plus an initial margin of 1.75% or (ii) CBFR (for loans denominated in U.S. dollars) or the Canadian Prime Rate (for loans denominated in Canadian dollars) less an initial margin of 0.75%, in each case, where margin is adjusted under the ABL Facility based on the quarterly average excess availability under the ABL Facility. The interest rates applicable to any loans under various Floor Plan Facilities ("Floor Plan Rates") are based on a wide range of benchmark rates (including SOFR, Prime, Bloomberg Short-Term Bank Yield Index, and the Canadian Bankers' Acceptance Rate) plus an applicable margin. As of March 31, 2025 the lowest Floor Plan Rate was SOFR plus an initial margin of 2.75%, and the highest was SOFR plus a margin of 5.1145% per annum.

At March 31, 2025 and December 31, 2024, we had $220.0 million and $182.9 million, respectively, outstanding borrowings under the ABL Facility. At March 31, 2025 and December 31, 2024, we had $367.7 million and $374.9 million, respectively, outstanding borrowings under the Floor Plan Facilities. As of March 31, 2025, based upon the amount of our variable rate debt outstanding, each one percentage point increase in the interest rates applicable to our variable rate debt, when including the hedge impact of our interest rate cap, would reduce our annual pre-tax earnings by $2.5 million. The amount of variable rate indebtedness outstanding may fluctuate significantly. See Note 8, Floor Plans, and Note 9, Long-Term Debt, in our condensed consolidated financial statements for additional information concerning the terms of our variable rate debt.

We have a fixed rate on the Notes of $500.0 million which are due in 2029. We do not have any exposure to changing interest rates as of March 31, 2025 on the fixed rate Notes. For additional information concerning the terms of our fixed rate debt, see Note 9, Long-Term Debt.

Commodity price risk: The market prices of diesel and unleaded fuels are unpredictable and can fluctuate significantly. Because of the volume of fuel we purchase each year, a significant increase in the price of fuel could adversely affect our business and reduce our operating margins. To manage a portion of this risk, we enter into fixed price swap contracts to purchase gasoline and diesel fuel related to forecasted fuel purchases. For the purchases of unleaded and diesel fuel that we expect to purchase at market prices in the next 12 months, each $0.10 per gallon increase in the price of diesel and unleaded fuel, holding other variables constant, would not have a material impact on our pre-tax income when including the fixed price swap contracts.

Foreign currency exchange rate risk: Due to our international operations, a portion of our revenues, cost of revenues, and operating expenses are subject to foreign currency exchange rate risk. Changes in the exchange rate of the U.S. dollar versus the Canadian dollar and European currencies affect the translated value and relative level of revenues and net income (loss) that we report from one period to the next. Based upon balances and exchange rates as of March 31, 2025, holding other variables constant, we believe that a hypothetical 10% increase or decrease in all applicable foreign exchange rates would not have a material impact on our results of operations or cash flows.

Item 4. Controls and Procedures.

Management’s Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of March 31, 2025. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of March 31, 2025, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) of the Exchange Act) during the quarter ended March 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

The information required with respect to this item can be found in Note 11, Contingencies, of the notes to the unaudited consolidated financial statements contained in this quarterly report and is incorporated by reference into this Item 1.

Item 1A. Risk Factors.

We face a number of uncertainties and risks that are difficult to predict and many of which are outside of our control. For a detailed discussion of the risks that affect our business, please refer to Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. There have been no material changes from the risk factors included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Share Repurchases

No shares were repurchased during the three months ended March 31, 2025. As of March 31, 2025, the Company had $14.2 million of remaining authorization under its share repurchase program.

Subsequent to the quarter, the Company's Board approved an increase to the Company’s common stock repurchase program authorization from $20.0 million to $30.0 million. As it relates to the deployment of the increased repurchase program, the Board also approved the immediate allocation of $10.0 million to a Rule 10b5-1 Plan (the “Rule 10b5-1 Plan”), whereby the Company directs a fiduciary to purchase the Company’s common stock at pre-determined price intervals. During the term of the Rule 10b5-1 Plan the fiduciary is permitted to purchase the Company’s common stock irrespective of reporting blackout periods or privileged information restrictions.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not Applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.


Exhibit Number		Description
3.1		Third Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the Form 8-A (File No. 001-38864) filed by the Company on February 14, 2020).
3.2		Amended and Restated Bylaws (incorporated by reference to Exhibit 3.2 of the Form 10-Q (File No. 001-38864) filed by the Company on November 12, 2024).
3.3		Certificate of Designation for 10% Series A Cumulative Perpetual Preferred Stock of Alta Equipment Group Inc. (incorporated by reference to Exhibit 3.3 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on December 22, 2020)
4.1		Indenture, dated June 5, 2024, among the Company, the Guarantors therein and Wilmington Trust, National Association, as trustee and collateral agent (incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on June 6, 2024).
4.2		Form of 9.000% Senior Secured Second Lien Notes due 2029 (incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on June 6, 2024).
10.1		Intercreditor Agreement, dated June 5, 2024, between JPMORGAN CHASE BANK, N.A., as Administrative Agent for the ABL First Lien Secured Parties, JPMorgan Chase Bank, N.A., as Administrative Agent for the Floor Plan First Lien Secured Parties, WILMINGTON TRUST, NATIONAL ASSOCIATION, as collateral agent for the Second Lien Secured Parties, and acknowledged by Alta Equipment Group Inc., Alta Equipment Holdings, Inc., Alta Enterprises, LLC, Alta Construction Equipment Illinois, LLC, Alta Heavy Equipment Services, LLC, Alta Industrial Equipment Michigan, LLC, Alta Construction Equipment, L.L.C., Alta Industrial Equipment Company, L.L.C., NITCO, LLC, Alta Construction Equipment Florida, LLC, Alta Industrial Equipment New York, LLC, Alta Construction Equipment New York, LLC, PeakLogix, LLC, Alta Construction Equipment Ohio, LLC, Alta Material Handling New York State, LLC, Alta Mine Services, LLC, Alta Kubota Michigan, LLC, Alta Construction Equipment New England, LLC, Alta Electric Vehicles Holding, LLC, Alta Electric Vehicles, LLC, Ginop Sales, Inc., A Alta Electric Vehicles South West, LLC, Alta Equipment Canada Holdings, Inc., Ecoverse, LLC, Alta Equipment Distribution, LLC, and Alta Construction Equipment Pennsylvania, LLC (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on June 6, 2024).
10.2		Sixth Amendment to Sixth Amended and Restated ABL First Lien Credit Agreement, dated June 5, 2024, among the Company, the guarantors party thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on June 6, 2024).
10.3		Seventh Amendment to Sixth Amended and Restated Floor Plan First Lien Credit Agreement among the Company, the lenders party thereto, and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.3 of the Current Report on Form 8-K (File No. 001-38864) filed by the Company on June 6, 2024).
31.1*		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS		Inline XBRL Instance Document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

*Filed herewith.

SIGNATURE

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.


	ALTA EQUIPMENT GROUP INC.

Date: May 7, 2025	By:	/s/ Anthony J. Colucci
		Anthony J. Colucci
		Chief Financial Officer (Principal Financial Officer and Authorized Signatory)