Winnipeg, Manitoba — Boyd Group Services, which operates the Boyd Autobody and Glass and Assured collision networks, announced its second-quarter financial results on Thursday.
For the quarter ended June 30, 2024, Boyd Group Services reported net income of $10.8 million, compared to $26.3 million for the same period in 2023. Factors affecting net income included acquisition and transaction costs and fair value adjustments on contingent consideration, according to the company. Adjusted net income for the quarter was $11.9 million, or 1.5 percent of revenue.
The internalization of scanning and calibration services, the use of centralized purchasing, the use of spare parts and Boyd’s “repair first” strategy contributed to an increase in adjusted EBITDA from 10.4 percent in the first quarter of 2024 to 11.5 percent in the second quarter of 2024, despite negative sales at existing stores.
“The internalization of scanning and calibration services, progress in Boyd’s ‘repair first’ strategy and focus on using low-cost alternative parts have created significant value by reducing repair costs for the company’s customers. Consequently, revenues that otherwise could have been generated have also declined,” the company wrote in its 41-month report to shareholders.
Gross profit was $355.5 million, or 45.6 percent of sales, in the second quarter of 2024. Boyd said gross profit margin benefited from improved scanning and calibration methods, higher part margins, improved glass margins and improvements in performance-based pricing. In addition, labor cost increases contributed to sales and gross profit.
With net income down compared to the second quarter of 2023, Boyd assured shareholders that the company has several initiatives in place to ensure it is well positioned for long-term success.
“Boyd made progress in improving gross margins and reducing costs for the company’s customers in the second quarter of 2024. Continued weakness in claims has impacted demand for services so far in the third quarter, resulting in revenue challenges in the stores, such as those experienced in the second quarter of 2024,” Boyd wrote.
“Although claims volumes and demand for services are currently below prior year levels, Boyd views these as short-term trends and remains very confident about the fundamentals of the business over the long term.”
Boyd added that it has added or acquired 30 new locations since the beginning of the year. The company assured that while this activity is progressing more slowly than a year ago, “opportunities and Boyd’s commitment to growth remain.”
Despite recent challenges in sales growth at existing stores, the company remains confident that Boyd is on track to achieve its long-term growth goals, including doubling the size of the store on a constant currency basis between 2021 and 2025 compared to 2019 sales, Boyd CEO Tim O’Day wrote in the second quarter 2024 report.
