Alta Equipment Group NYSE: ALTG reported a stronger second quarter as improving equipment demand, recovering deliveries and better margins lifted results sharply from the first quarter, while management narrowed the upper end of its full-year adjusted EBITDA outlook because of timing considerations for material-handling deliveries.
Second-quarter revenue totaled $475.5 million and adjusted EBITDA was $48.6 million. Revenue rose by approximately $65 million sequentially, while adjusted EBITDA increased by about $20.5 million from $28.1 million in the first quarter. Adjusted EBITDA margin expanded 340 basis points sequentially to 10.2%.
Total gross margin increased about 70 basis points year over year to 26.1%, and companywide gross margin on new and used equipment improved to 15.3%. Chief Financial Officer Tony Colucci said the results reflected seasonal improvement in construction and rental activity, stronger equipment-market conditions, improved equipment margins and operational execution.
Material Handling Backlog Reaches Highest Level Since 2023
Chairman and CEO Ryan Greenawalt said material handling provided the clearest indication of improving demand. Industry bookings in Alta's areas of responsibility rose 12.3% in the first half from a year earlier, including a 4.9% increase in the second quarter.
Alta's material-handling backlog reached approximately $143 million, its highest level since 2023. Greenawalt said the order book provides visibility into second-half invoicing because bookings typically convert to backlog and then revenue over subsequent quarters.
Material handling generated $19 million of adjusted EBITDA, up approximately 13% from the prior-year quarter despite lower revenue. Colucci attributed the performance to service execution, booking momentum and improved operating efficiency.
Management cited aging customer fleets and expanded product offerings as factors supporting demand. Greenawalt said some customers had deferred replacements over the prior two years, while modular, value-oriented equipment configurations from OEM partners are allowing Alta to address more cost-conscious applications alongside its premium products.
During the question-and-answer session, Colucci said the modular offerings were not expected to create a service-revenue headwind. Greater commonality across the product lineup could potentially improve parts turns, he said.
Construction Activity and Equipment Margins Improve
Construction equipment activity accelerated after a delayed seasonal start, according to management. Market deliveries in Alta's areas of responsibility rose 20.1% in the second quarter from the prior-year period and were up 7.5% for the first half. Florida was a particular area of strength, including in articulated haulers, Greenawalt said.
Construction equipment generated adjusted EBITDA of $30.6 million, representing a $16.7 million sequential increase. Colucci said equipment margins improved and utilization strengthened through the quarter as the business benefited from its expected seasonal recovery.
Management pointed to road and bridge work, municipal projects, energy infrastructure and manufacturing investment as sources of construction equipment activity. Greenawalt also said dealer inventories have declined, OEM discounting has moderated and used-equipment values have improved from 2025 lows.
Colucci said Alta expects equipment gross margins to remain firm and potentially improve further in the second half. He said the broader market had returned to more normal supply-demand conditions, although Alta has continued to optimize inventory and has at times accepted lower-margin deals to reduce balance-sheet inventory.
The company does not intend to expand its construction rental fleet in the near term. Colucci said Alta remains focused on improving utilization and expects to reduce the fleet further by year-end if demand remains at current levels. He said the company would like rental revenue as a percentage of gross fleet to move into the high 30% range or reach 40%, compared with roughly 35% at the end of the second quarter based on trailing 12-month rental revenue of $175 million and gross fleet of $500 million.
Ecoverse Profitability Recovers; Asset Efficiency Improves
Within Alta's master distribution business, Ecoverse posted one of its strongest quarters since its acquisition. Revenue increased to $22.8 million from $20.9 million a year earlier, while adjusted EBITDA rose to $2.8 million from $1.1 million.
Colucci said revised OEM pricing arrangements and a more stable tariff environment helped reverse much of the margin pressure that had affected Ecoverse over the past year. He said management believes demand for the specialty environmental processing equipment has remained intact and that the business now has costs better aligned with pricing in the marketplace.
Alta also highlighted efforts to improve capital efficiency. Average assets in material handling declined approximately $52 million, or 11%, while trailing 12-month adjusted EBITDA as a percentage of average assets increased 120 basis points to 16%. In construction equipment, average assets declined approximately $77 million, or 8%, and return on assets rose 60 basis points to 11.4%.
As of June 30, Alta had approximately $225 million in total liquidity and net leverage of roughly 4.7 times. Colucci said the company has no meaningful debt maturities until 2029 and maintains a largely fixed-rate debt profile.
Guidance Narrowed on Delivery Timing
Alta narrowed its 2026 adjusted EBITDA guidance range to $167.5 million to $177.5 million, reducing the upper end by $5 million. The company reaffirmed its free cash flow before rent-to-sell decisioning forecast of $100 million to $110 million.
Colucci said the reduced upper bound was not based on weaker demand expectations. Rather, it reflects greater visibility into the timing of equipment deliveries and the possibility that some material-handling backlog could convert into revenue in 2027 instead of 2026.
Management said it remains confident in the lower end of the EBITDA range and expects second-half performance to be supported by material-handling backlog, construction activity, improving equipment margins, Ecoverse's normalized profitability and productivity initiatives across the business.
Greenawalt said Alta's longer-term strategy is centered on organic growth, operating consistency and disciplined capital allocation following 17 acquisitions since its initial public offering. The company has grown from 43 locations to 85 locations and employs approximately 2,600 people.
About Alta Equipment Group (NYSE:ALTG)
Alta Equipment Group, Inc NYSE: ALTG is a North American distributor of material handling and logistics equipment. The company offers a broad lineup of forklifts, lift trucks, aerial work platforms, tow motors, pallet jacks and related attachments, serving manufacturing, warehousing, distribution and industrial facilities. Through its network of branch locations, Alta Equipment provides customers with new and used sales, short- and long-term rentals, and integrated fleet management solutions designed to support operational efficiency.
In addition to equipment sales, Alta Equipment supports customers with comprehensive after-sales services.
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