Generac Holdings 10-Q 2025-03-31

Filed 2025-05-06. 2 sections, 166K characters. Original on sec.gov · Markdown · JSON

Cover and table of contents

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

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

	For the quarterly period ended March 31, 2025

OR

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

	For the transition period from to

Commission File Number 001-34627

GENERAC HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Delaware	20-5654756
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)

S45 W29290 Hwy 59, Waukesha, WI	53189
(Address of principal executive offices)	(Zip Code)

(262) 544-4811

(Registrant's telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	GNRC	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 2, 2025, there were 59,081,648 shares of registrant's common stock outstanding.

GENERAC HOLDINGS INC.

TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Balance Sheets as of March 31, 2025, and December 31, 2024	1

	Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 31 , 2025 and 2024	2

	Condensed Consolidated Statements of Stockholders' Equity for the Three Months Ended March 31 , 2025 and 2024	3

	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31 , 2025 and 2024	4

	Notes to Condensed Consolidated Financial Statements	5

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	17

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27

Item 4.	Controls and Procedures	27

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	27

Item 1A.	Risk Factors	27

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 3.	Defaults Upon Senior Securities	28

Item 4.	Mine Safety Disclosures	28

Item 5.	Other Information	28

Item 6.	Exhibits	28

	Signatures	29

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

Generac Holdings Inc.
Condensed Consolidated Balance Sheets
(U.S. Dollars in Thousands, Except Share and Per Share Data)
(Unaudited)

	*March 31,*			*December 31,*
	*2025*			*2024*
Assets
Current assets:
Cash and cash equivalents	$	187,464		$	281,277
Accounts receivable, less allowance for credit losses of $35,944 and $35,465 at March 31, 2025 and December 31, 2024, respectively		590,120			612,107
Inventories		1,095,082			1,031,647
Prepaid expenses and other current assets		115,873			107,139
Total current assets		1,988,539			2,032,170

Property and equipment, net		709,530			690,023

Customer lists, net		150,430			152,737
Patents and technology, net		369,053			379,095
Other intangible assets, net		17,623			20,026
Tradenames, net		204,977			206,664
Goodwill		1,442,571			1,436,261
Deferred income taxes		31,315			24,132
Operating lease and other assets		146,416			168,223
Total assets	$	5,060,454		$	5,109,331

Liabilities and stockholders’ equity
Current liabilities:
Short-term borrowings	$	56,533		$	55,848
Accounts payable		439,699			458,693
Accrued wages and employee benefits		50,422			81,485
Accrued product warranty		56,161			56,127
Other accrued liabilities		332,466			313,401
Current portion of long-term borrowings and finance lease obligations		72,307			67,598
Total current liabilities		1,007,588			1,033,152

Long-term borrowings and finance lease obligations		1,195,861			1,210,776
Deferred income taxes		33,709			33,185
Deferred revenue		200,050			193,260
Operating lease and other long-term liabilities		150,221			141,515
Total liabilities		2,587,429			2,611,888

Stockholders’ equity:
Common stock, par value $0.01, 500,000,000 shares authorized, 74,035,516 and 73,785,631 shares issued at March 31, 2025 and December 31, 2024, respectively		740			738
Additional paid-in capital		1,145,990			1,133,756
Treasury stock, at cost, 14,953,986 and 14,173,697 shares at March 31, 2025 and December 31, 2024, respectively		(1,303,086	)		(1,196,997	)
Excess purchase price over predecessor basis		(202,116	)		(202,116	)
Retained earnings		2,888,136			2,844,296
Accumulated other comprehensive loss		(60,440	)		(85,399	)
Stockholders’ equity attributable to Generac Holdings Inc.		2,469,224			2,494,278
Noncontrolling interests		3,801			3,165
Total stockholders' equity		2,473,025			2,497,443
Total liabilities and stockholders’ equity	$	5,060,454		$	5,109,331

See notes to condensed consolidated financial statements.

Generac Holdings Inc.
Condensed Consolidated Statements of Comprehensive Income
(U.S. Dollars in Thousands, Except Share and Per Share Data)
(Unaudited)

	Three Months Ended March 31,
	*2025*			*2024*

Net sales	$	942,121		$	889,273
Costs of goods sold		570,135			572,894
Gross profit		371,986			316,379

Operating expenses:
Selling and service		126,065			108,586
Research and development		62,048			49,410
General and administrative		74,746			66,764
Amortization of intangibles		25,489			24,750
Total operating expenses		288,348			249,510
Income from operations		83,638			66,869

Other (expense) income:
Interest expense		(17,110	)		(23,605	)
Investment income		2,225			1,688
Change in fair value of investment		(9,947	)		(6,019	)
Other, net		(292	)		(422	)
Total other expense, net		(25,124	)		(28,358	)

Income before provision for income taxes		58,514			38,511
Provision for income taxes		14,236			12,033
Net income		44,278			26,478
Net income attributable to noncontrolling interests		438			246
Net income attributable to Generac Holdings Inc.	$	43,840		$	26,232

Net income attributable to Generac Holdings Inc. per common share - basic:	$	0.74		$	0.39
Weighted average common shares outstanding - basic:		59,062,534			59,849,362

Net income attributable to Generac Holdings Inc. per common share - diluted:	$	0.73		$	0.39
Weighted average common shares outstanding - diluted:		59,747,589			60,486,125

Comprehensive income attributable to Generac Holdings Inc.	$	68,799		$	22,564

See notes to condensed consolidated financial statements.

Generac Holdings Inc.
Condensed Consolidated Statements of Stockholders' Equity
(U.S. Dollars in Thousands, Except Share Data)
(Unaudited)

	Generac Holdings Inc.
													Excess Purchase Price			Retained		Accumulated
					*Additional*								*Over*			*Earnings*		*Other*		*Total*
	Common Stock				*Paid-In*		Treasury Stock						*Predecessor*			*(Accumulated*		*Comprehensive*		*Stockholders'*	*Noncontrolling*
	*Shares*		*Amount*		*Capital*		*Shares*			*Amount*			*Basis*			*Deficit)*		*Income (Loss)*		*Equity*	*Interest*	*Total*
Balance at January 1, 2025		73,785,631	$	738	$	1,133,756		(14,173,697	)	$	(1,196,997	)	$	(202,116	)	$	2,844,296	$	(85,39

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