Winnipeg, Manitoba — Boyd Group Services, which operates the Boyd Autobody and Glass and Assured collision networks, reported its second-quarter financials on Thursday.
For the quarter ended June 30, 2024, Boyd Group Services posted net earnings of US$10.8 million, compared to US$26.3 million in the same period of 2023. Factors impacting net earnings, according to the company, were acquisition and transaction costs and fair value adjustments on contingent consideration. Adjusted net earnings for the quarter rang in at $11.9 million, or 1.5 percent of sales.
The internalization of scanning and calibration services, use of centralized purchasing, aftermarket parts usage and Boyd’s repair first strategy contributed to increased adjusted EBITDA, from 10.4 percent in Q1 2024 to 11.5 percent in Q2 2024, despite negative-same-store sales.
“The internalization of scanning and calibration services, progress in Boyd’s repair first strategy and focus on the use of cost-effective alternative parts, delivered strong value by lowering repair costs for the Company’s consumers, and consequently reduced sales that otherwise could have been achieved,” wrote the company in its 41-report to shareholders.
Gross profit was US$355.5 million, or 45.6 percent of sales, for Q2 2024. Boyd indicated that gross margin percentage benefited from increased scanning and calibration; higher parts margins; improved glass margins and improvements in performance-based pricing, adding that labour rate increases have added to sales and gross profit dollars.
In the face of decreased net earnings compared with Q2 2023, Boyd reassured shareholders that it has several initiatives to ensure the business is well-positioned for long-term success.
“Boyd made progress in improving gross margins and keeping costs down for the Company’s customers in the second quarter of 2024. The continued claims softness has impacted demand for services thus far in the third quarter, which is resulting in same-store sales challenges as were experienced during the second quarter of 2024,” wrote Boyd.
“While claims volumes and demand for services are currently below prior-year levels, Boyd views these as short-term trends and remains highly confident in the underlying fundamentals of the business over the longer term.”
Boyd added that it has added or acquired 30 new locations year-to-date. The company reassured that, while this activity is running at a slower pace than was the case a year ago, “opportunities and Boyd’s commitment to growth remain.”
Despite the recent same-store sales growth challenges, the company remains confident that Boyd is on track to achieve its long-term growth goals, including doubling the size of the business on a constant currency basis from 2021 to 2025 against 2019 sales, wrote Boyd CEO Tim O’Day in the Q2 2024 report.
