Earnings call transcript: Douglas Dynamics Q2 2025 beats earnings estimates

Douglas Dynamics, Inc. (PLOW) reported its Q2 2025 earnings, surpassing analysts’ expectations with an earnings per share (EPS) of $1.14, compared to the forecasted $1.00. The company also outperformed on revenue, posting $194.3 million against a forecast of $189.47 million. Following the announcement, the stock price rose by 5.05% to $28.32. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value calculation, with a strong YTD return of 22.55%. The company maintains a "FAIR" overall financial health score, suggesting stable operational performance.

Key Takeaways

• Douglas Dynamics exceeded EPS and revenue forecasts for Q2 2025.
• Stock price increased by 5.05% following the earnings release.
• The company is cautiously optimistic about winter equipment demand despite a 2.8% decrease in net sales year-over-year.

Company Performance

Douglas Dynamics reported a solid performance in Q2 2025, despite a slight decline in net sales by 2.8% year-over-year. The company maintained stable EBITDA margins at 21.9%, and GAAP net income rose by 6.9% to $26 million. The company continues to navigate market challenges with strong domestic sales and a reduced leverage ratio. InvestingPro data reveals impressive profitability metrics, including a return on equity of 27% and a healthy gross profit margin of 26.54%. The company’s strong financial position is further evidenced by its current ratio of 2.37, indicating robust liquidity management.

Financial Highlights

• Revenue: $194.3 million, down 2.8% year-over-year
• Earnings per share: $1.14, up from $1.09 in the previous year
• Adjusted EBITDA: $42.6 million
• Free cash flow: Negative $17.8 million, an improvement from negative $21.9 million last year

Earnings vs. Forecast

Douglas Dynamics reported an EPS of $1.14, beating the forecast of $1.00 by 14%. Revenue also exceeded expectations, coming in at $194.3 million against a projected $189.47 million. This marks a positive surprise for the company, reflecting its resilience in a challenging market environment.

Market Reaction

Following the earnings announcement, Douglas Dynamics’ stock price rose by 5.05% to $28.32. This increase reflects investor confidence in the company’s ability to surpass earnings expectations and manage operational challenges effectively. The stock remains within its 52-week range, with a high of $31.98 and a low of $21.3.

Outlook & Guidance

The company provided guidance for full-year net sales between $630 million and $660 million, with adjusted EPS expected to range from $1.65 to $2.15. Douglas Dynamics is optimistic about winter equipment demand and anticipates improved EBITDA margins in the low double digits.

Executive Commentary

CEO Mark Van Genderen stated, "We are well positioned to respond to mother nature this coming winter," highlighting the company’s preparedness for seasonal demand. He also emphasized the advantage of their global sourcing team in navigating current market conditions.

Risks and Challenges

• Market Demand: The elongated equipment replacement cycle and below-average snowfall could impact future sales.
• Supply Chain: Potential disruptions in steel sourcing and international materials could affect production.
• Economic Conditions: Interest rate changes may influence short-term demand, although current levels are manageable.

Q&A

During the earnings call, analysts inquired about the impact of interest rates on demand and the company’s inventory levels. Executives noted that rate cuts are unlikely to significantly affect demand and that inventory levels for plows and hoppers are nearing optimal levels. The company also mentioned its focus on potential acquisitions in the truck and vehicle attachments sector. InvestingPro highlights that Douglas Dynamics has maintained dividend payments for 16 consecutive years, with a current dividend yield of 4.17%. This consistency, combined with additional ProTips available on InvestingPro, suggests strong fundamental stability. Investors seeking detailed analysis can access the comprehensive Pro Research Report, available for PLOW and 1,400+ other US stocks on the platform.

Full transcript - Douglas Dynamics Inc (PLOW) Q2 2025:

Conference Operator: Good morning, and welcome to the Douglas Dynamics Second Quarter twenty twenty five Earnings Conference Call. All participants will be in listen only mode. Please note this event is being recorded. I would now like to turn the conference over to Nathan Elwell, Vice President of Investor Relations. Please go ahead.

Nathan Elwell, Vice President of Investor Relations, Douglas Dynamics: Thank you, Drew. Welcome everyone and thank you for joining us on today’s call. Before we begin, I would like to remind you that some of the comments that will be made during this conference call, including answers to your questions, will constitute forward looking statements. These forward looking statements are subject to risks that could cause our actual results to be materially different. Those risks include, among others, matters that we have described in yesterday’s press release and in our filings with the SEC.

Please note we have published a one page fact sheet on our IR website that summarizes our results for the quarter. Joining me on the call today is Mark Van Genderen, President and CEO and Sarah Lauber, Executive Vice President and CFO. Mark will provide an overview of our performance, followed by Sarah reviewing our financial results and guidance. After that, we’ll open the call for questions. With that, I’ll hand the call over to Mark.

Please go ahead.

Mark Van Genderen, President and CEO, Douglas Dynamics: Thanks, Nathan, and welcome, everyone. I’m pleased to say it was another good quarter for our company with both segments executing well and a continuation of recent trends. Overall, our results were comparable to the same period last year. Solutions delivered another record quarter, the fifth in a row and with an impressive profit increase. Preseason demand and shipments at attachment were generally in line with our expectations.

When combined, this has allowed us to narrow and increase our guidance ranges for the year. Sarah will speak to that later. Our business is running at a high level of efficiency and effectiveness right now and it’s great to see the strong engagement of our teams. Let me run through our performance in each segment, starting with work truck attachments. Snowfall last year was about 10 below the longer term average, but up compared to the previous two winters.

Ice events were well above average. This weather coupled with dealer inventories moving in the right direction position us well as we proactively address the elongated equipment replacement cycle. More specifically, the ratio of pre season shipments in 2025 is expected to be closer to the more traditional 55% to 45% split between the second and third quarters. Last year in 2024, we shipped 65% of preseason in Q2 and 35% in Q3. This was unique as higher finished goods inventory at the end of Q1 last year drove a stronger shipment mix in Q2.

As we’ve noted, company owned attachment inventories this year has decreased significantly compared to last year. We are also seeing dealer inventories coming back in line with expectations after a couple of years of being elevated, which assuming we receive a normal amount of cooperation from mother nature bodes well for us this winter. We will be paying careful attention to reorder activity in the back half of the year and weather trends in the fourth quarter. Finally, I’m pleased to say that dealer sentiment and financial health both remain positive. Clearly, the segment has adapted and adjusted to the unique weather patterns of the past several years.

This is what we are good at. Production plans are logical, inventories are in good shape, and we are playing off of our front foot operationally. To summarize, we are well positioned to respond to mother nature this coming winter. Turning to work truck solutions, the team exceeded expectations and in doing so delivered their fifth consecutive record performance. This is even more impressive now that the comps are tougher compared to a record quarter last year.

We remain encouraged by the progress that’s been made in recent years and the strength of our backlog, which is being driven by robust municipal demand. Our municipal business continues to grow thanks to our investments and optimization efforts in recent years, plus our strong competitive position in a dynamic market. In our commercial business, we are seeing softer order patterns at the local dealer level due to overall economic and competitive pressures. Dealers have a fair amount of inventory on the ground and when you add higher interest rates compared to the last several years and cautious consumer sentiment in general, smaller customers are more price conscious and hesitant. The commercial fleet business however remains generally positive and seems less impacted by these near term issues.

Finally, the backlog in solutions is still very strong. The mix between commercial and municipal backlog shifts over time and municipal customers make up the lion’s share right now. We are booking production dates well into 2026 and are adding approximately 10% of additional municipal capacity which we expect will come online next year. So overall continued strong performance in the solutions segment. Before we go any further, let me take a moment to reiterate our position on tariffs and their potential impact on our performance.

First and foremost, we are a US focused company. Our operations, supply base and sales are all primarily domestic. We have increased our annual guidance and that includes a logical assessment of the impact of tariffs this year. As we look further out, we will continue following the evolving situation and analyze to what extent the proposed tariffs would impact our business. Our global sourcing team is a real advantage in times like this and we are well versed in moving quickly to adapt to changes.

We know we’re in good hands with that team and stand ready to manage through additional tariffs and trade rule changes. Okay, I’d like to take a step back and touch on the three priorities we’ve been formalizing internally. And we’ve really been focusing much of our time on this year, namely optimize, expand and activate. We have three great businesses that are already operating efficiently, but we know there is always more that can be done. So our first priority is to optimize our current operations.

Of course, this isn’t a new concept at Douglas Dynamics, it’s part of our DNA. But it makes sense to step back and with a newly formed leadership team, ensure that we are fully focusing our efforts across the organization. One of the best examples of our optimized initiative is our long term project to create centers of excellence within the attachment segments. In the past, our three facilities in Milwaukee, Madison Heights, Michigan and Rocklin, Maine operated as they had historically, generally centered around our three brands. Over the past several years, our manufacturing team has initiated the monumental project of moving specific production to individual facilities, thereby creating centers of excellence that focus on specific aspects of our manufacturing.

A good example of this is our Madison Heights, Michigan facility that manufactures all of our hoppers and spreaders regardless of brand. We can focus all of our engineering, supply chain and manufacturing expertise across all three brands in that one facility. So optimize is the first pillar. The second is expand. Pursuing organic geographic growth opportunities and product offerings to exceed customer expectations.

Earlier, I mentioned a great example of geographic expansion and solutions. Lead times across the municipal segment are getting longer and we believe our ability to deliver trucks on time is an important differentiator. This is one of the reasons we recently broke ground on a new multi purpose facility leased in Columbia, Missouri to better serve the surrounding markets with new upfits and to service existing in market municipal trucks. At Attachments, our engineering team is world class. We consistently strive to develop the next generation upgrades of our existing products and we also work to broaden our product offering.

Recently we launched a new piece of tech, an auto speed controller for hopper spreaders at the annual snow and ice management association conference and it’s being well received within the industry. This controller is located in the vehicle cab and easily links directly to the truck’s CPU. This allows it to automatically adjust the flow of de icing material as the vehicle speed changes, improving efficiency, reducing wasted de icing material, allowing for better monitoring and giving the contractor one less thing to think about as they work. What’s more, this technology is retroactively compatible with Douglas Dynamic Truck Hoppers across our Western, Fisher and SnowEx brands going back almost ten years. We are also exploring new areas of snow and ice control in collaboration with partners.

We can’t talk about that at the moment, but we plan to have more to say in 2026. And finally, activate, which refers to the restart of our M and A efforts as we look for the opportunities to build our portfolio of attachments and diversify our overall offering over the long term. As I mentioned last quarter, with the recent improvements in our performance and balance sheet and a clear vision of the types of acquisitions we are best suited to make operationally, we can now consider small to medium sized deals if and when we find the right opportunity. Ideally, these opportunities would be in the work vehicle attachment space, have strong brands and growth potential, as well as being a good cultural fit. We have started to conduct more research and investigate companies while still maintaining our disciplined approach.

There will be more to come on our strategic pillars in the coming quarters. To conclude, this was another quarter characterised by strong execution, ongoing dedication and market leading innovation. I would categorize our general outlook as remaining positive but with caution looking around the corners as to what might be coming our way. Inside our company we firmly believe we have the right people in place and operations that are correctly aligned with the current market conditions. In work truck attachments we are operating efficiently and we are correctly sized to work through the elongated replacement cycle ready to use our agility to handle whatever weather conditions we see later this year.

In Work Truck Solutions, while seeing softness in our commercial dealer business, continues to see a positive fleet business and substantial demand and backlog in our municipal business. And the alignment of our future strategy around the optimize, expand and activate areas of focus reinforces our confidence that we can achieve our longer term growth and profitability goals in the years ahead. Thank you to everyone at Douglas Dynamics for your commitment and drive to exceed. I fully believe that the future presents many exciting opportunities for us to grow and achieve our considerable potential. With that, I’d like to pass the call to Sarah.

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: Thanks, Mark. I will walk through the quarter. I’ll explain our increased guidance and then open it up to questions. Before I talk to the numbers, unless stated otherwise, all the comparisons I’ll make today are between the 2025 and the 2024. I am pleased to say it was a positive and straightforward quarter.

The record results at Work Truck Solutions offset the anticipated lower volumes at Work Truck Attachments, and our overall performance was essentially in line with last year. Consolidated net sales decreased just 2.8% when compared to 2024 due to the expected lower volumes at Attachments related to the timing of preseason shipments. SG and A expenses decreased 6.9 to $21,800,000 for the quarter based on lower stock based compensation and employee benefits costs. Interest expense decreased 27.9% to 3,000,000 due to lower borrowings on the revolver and term loan. GAAP net income for the quarter was 26,000,000 or $1.09 per diluted share, an increase of 6.66.9% respectively.

Adjusted EBITDA was 42,600,000.0 and margins were flat to last year at 21.9%, which reflects the strength of solutions margin improvements that offset the impact of lower preseason shipments and attachment. Overall results were positive and can be classed to neither in line or better than our expectations. When combined with a strong first quarter, we produced a robust first half of the year that has allowed us to narrow and raise our guidance ranges, which I’ll get to later. Okay, let’s look at the results for

Mike Schlisky, Analyst, D.A. Davidson: the two

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: segments. Overall, work truck attachments Attachments had a good quarter, and our preseason is progressing generally as we expected. Net sales of $108,100,000 and adjusted EBITDA of $31,600,000 are lower, but that’s due to the anticipated timing of preseason shipments. This year, the ratio of preseason shipments in 2025 is expected to be close to the more traditional 55% to 45% split between the second and third quarters. And if you remember, the 2024 preseason was unusual as higher inventory levels led to significantly more equipment being shipped in the second quarter.

That meant the 2024 preseason was unusually skewed towards 2Q in a 65% to 35% ratio. Given that shift, our results this quarter are actually better than they appear at first glance, and we’re in line with our expectations, thanks to strong execution from the team. Now let’s focus on Work Truck Solutions, which continues to set records and exceed expectations despite facing tough comparisons to a record setting quarter last year. We continue to be encouraged by the team’s progress, delivering top and bottom line growth once again. Net sales increased 5.4% to $86,200,000 Adjusted EBITDA grew an impressive 39.8 to $11,000,000 based on product mix, price realization and higher municipal throughput.

The adjusted EBITDA margin of 12.8% is a record for any quarter since 2017. It’s fantastic to see the teams deliver such excellent profitability. They’re really showing us what they’re capable of this year. Remember that 2024 was a record year for solutions. We’ll continue to face difficult comparisons in the back half of the year as we start to measure up to the record results in previous quarters.

Also, the solutions business can vary from one quarter to the next. That worked in our favor so far this year. But based on projected product mix and the timing of deliveries, we anticipate margins will be slightly lower in the 2025. That being said, we still expect Solutions 2025 results to show continued improvement of margin sustainability over the longer term. Overall, our backlog remains near record level.

Municipal demand is strong and we’re working to augment our capacity on that side of the business given we have great visibility into 2026. We have less visibility for our commercial business. Our fleet business remains solid, but local and dealer business order trends are softening. We will be monitoring this closely as the year continues to unfold. With the results for the quarter covered, I’ll turn to the balance sheet and liquidity figures.

For the 2025, net cash used in operating activities improved 6,400,000.0 to 12,700,000.0 due to improved earnings somewhat offset by changes in working capital. Total inventory was 153,300,000.0 versus 139,400,000.0. As we discussed last quarter, the Attachments segment has done a great job significantly reducing its inventory over the past year, but this is being mapped by the planned inflow of components to supply the rich backlog of orders in solution. Year to date, free cash flow increased approximately 4,000,000 to negative 17,800,000.0 compared to negative 21,900,000.0 in the ’24. At mid year, we maintained 90,500,000.0 of total liquidity comprised of 8,000,000 in cash and 82,500,000.0 of capacity on the revolver, which is more than ample for our needs this year.

Capital expenditures increased by 2,400,000.0 in the 2025 as planned. We still expect full year CapEx to be towards the higher end of our traditional range of 2% to 3% of net sales. As we catch up on projects we postponed last year and we accelerate a few facility projects as part of last year’s sale leaseback agreement. On a related note, thanks to the work we undertook to improve our balance sheet this last year, plus the amended debt agreement signed in March, our leverage ratio is now two point zero times. That’s significantly lower than the 3.3 times this time last year, now at a very manageable level, and we expect to stay around two times for the second half of the year, which is well within our goal range of 1.5 to three times.

Finally, as I said in the past, in a normal to good year, we generate a lot of cash. While some of that will continue to be reinvested in the business, we’re committed to returning a healthy amount to investors. We have consistently paid a strong dividend, and we don’t expect that to change. It remains our top priority. We’re also open to other opportunities, and we repurchased around 210,000 shares during the quarter, covering the stock grants.

The dividend and buyback combined totaled 12,900,000 returned to shareholders. Okay, let’s turn to our outlook. The headline is this. We are now able to raise and narrow our guidance ranges based on the combination of preseason orders at attachments in line with our expectations, plus another record quarter and strong overall backlog at Solutions. So we now expect net sales to be between $630,000,000 and $660,000,000 Adjusted EBITDA is now predicted to range from $82,000,000 to 97,000,000 Adjusted earnings per share are expected to be in the range of 1.65 per share to $2.15 per share.

Let me provide a little more context. At Attachments, preseason orders were generally in line with expectations. As a reminder, our outlook always assumes average snowfall in the fourth quarter. However, we are also assuming that the elongated equipment replacement cycle will continue to have an impact, and therefore average snowfall may not translate into average volume. When combined with lower dealer inventories, the overall data indicates we remain on track.

We believe our measured cost control efforts and close management of production schedules means we’re ready for whatever weather conditions we see later this year. For solutions, we’re confident our operations are performing well and our near record backlog provides a level of visibility for the remainder of 2025 and into 2026. We face tough comparisons in the second half of the year, but we currently remain on track to deliver expected low double digit adjusted EBITDA margin, which would be an improvement for the fourth year in a row. It’s worth remembering that although uncertainty around the economy and tariffs continues, we have a US centric business model and believe we are better positioned than most companies. Given all of our manufacturing manufacturing takes takes place place in in The The US, around 95% of our net sales are in The US, and we source the vast majority of our steel in The US, and less than 10% of our direct materials are sourced from China, Mexico or Canada.

As a reminder, our guidance includes our expected exposure for current tariffs. To summarize, we’re very pleased with our year to date results and we’re focused on executing well in the back half of the year. With that, we’d like to open the call for questions.

Conference Operator: We will now begin the question and answer session. The first question comes from Mike Schlisky with D. A. Davidson. Please go ahead.

Mike Schlisky, Analyst, D.A. Davidson: Good morning. What would lower interest rates do for demand in the back half of the year? If we see a rate cut by the year end or maybe early winter, would it be too late stimulate some last minute fourth quarter demand for additional snow and ice control equipment? And I guess maybe similarly on the commercial side, what’s been a little bit challenged more recently, could you squeeze in some deliveries at the end of the year if we saw lower interest rates, would anything have

Mark Van Genderen, President and CEO, Douglas Dynamics: to wait until 2026? Yeah, Mike, it’s Mark. I’ll take that one. I would say generally, no.

Mike Schlisky, Analyst, D.A. Davidson: You’d have

Mark Van Genderen, President and CEO, Douglas Dynamics: to see some pretty significant decreases to ultimately end up with consumer interest rates, contractor consumer interest rates at a point where that would, I’d say, move the needle. For us, it’s really more around the average snowball or above in the fourth quarter.

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: Yeah, I would just add, Mike. Any positive economic sentiment that we start to feel from a demand perspective, if that were to occur, to have the capacity and be able to deliver additional snow and ice equipment and or commercial volumes, we have the capacity and would be able to do that if we actually felt enough of that lift that you’re describing.

Mark Van Genderen, President and CEO, Douglas Dynamics: And I would add on top of that too, to Sarah’s point, if over time, you’re kind of talking short term, if over time, we were to see interest rates move down to where they were on average, two, three, four years ago. So say from the consumer level from the 8% to 10 range to the 2% to 4% range, that certainly has a positive impact on the business, because it’s our equipment and then in a lot of cases it’s the new trucks that are being purchased at the same time.

Mike Schlisky, Analyst, D.A. Davidson: Great. My other question was, I want to follow-up on your comment about capacity. If you’re adding 10% more capacity for a municipal business, does that mean that you’re reducing commercial capacity, or are you overall increasing your capacities? And just want to make sure that what you’re adding isn’t just crowding in, but there’s some decent margin on a

Mark Van Genderen, President and CEO, Douglas Dynamics: Yeah, it’s a great question. When we talk about it on the municipal side, it’s additional capacity that isn’t replacing anything in the fleet or dealer. So a lot of it’s really driven, I mentioned the new facility that’s currently being built for Henderson, both for new vehicles production as well as for servicing in Columbia, Missouri. We broke ground on that with our partners about a month ago or so and they’re currently on track. That’s going to be a beautiful purpose built facility that’s going to increase capacity overall for Henderson.

Mike Schlisky, Analyst, D.A. Davidson: Thank you so much. I’ll pass it along.

Conference Operator: The next question comes from Tim Weiss with Baird. Please go ahead.

Tim Weiss, Analyst, Baird: Hey, everybody. Good morning. Nice job. Maybe just my first question, just as you’re kind of looking at the channel now for Attachments, I know that there’s an elongated kind of replacement cycle, but how would you kind of characterize the inventory levels relative to kind of what you would see on a I don’t know if it’s a ten year average or something like that? Just trying to get some context about where the channel is on the attachment side.

Mark Van Genderen, President and CEO, Douglas Dynamics: Yeah, we look at inventory and kind of through two different lenses. What’s our inventory and then what’s the dealer inventory? And I guess I’ll start with ours. I know you talked about channel, but I’ll talk to us a bit about ours. Our current inventory and both Sarah and I noted on it is I think we’re in very, very good shape right now just in terms of overall production, in terms of production planning.

The whole centers of expertise that I discussed has really helped us with, I’d say, optimal inventory control and then increased flexibility should we see demand move up or down. We’re certainly hoping, planning and expecting it to be up this winter with additional hopefully normal snowfall. In the dealer channel, I’ve spent a lot of time talking with our dealers. Our sales team would tell you that on the plow side, it’s come down nicely over the last couple of years. Is it exactly where we’d like it to be?

I think it’s pretty close. And between our, what I’ll say, cautious approach to production coupled with a normal snow year. You’d see the dealers in a really good spot this year as it relates to inventory. I think on the hopper side, just based on the fact that last season we had such a strong year as it relates to snow and ice. Certainly from a qualitative standpoint, again, at the shows and in talking with dealers, there’s real desire for that product.

I think inventories, I would say are generally in very good shape. And I think the addition of us introducing this new auto speed controller that I shared and we launched a couple of months ago and that’s retroactive back for several years. I think that really bodes well for hoppers. So in a nutshell, I’d say again, plow inventory pretty close to where we’d like it to be, maybe a little bit of an opportunity at the dealer level to get it better, which will happen with our production and a good snowfall year and hoppers and spreaders pretty much right on where we would want it to be.

Tim Weiss, Analyst, Baird: Okay, great. That’s really helpful. And then just on the solution side, you mentioned mix was favorable. Was that mix within kind of just muni versus commercial or is it mix within mix, like the mix within one of those businesses? Just some added color on that.

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: Yeah, it was really more mix within the municipal side of the business. So we have a lot of contracts that we’re aware of. And as you know, we have pretty good visibility in that business. For the first and second quarters, we did have quite a few trucks going out the door that are at a higher than typical margin. So it’ll be a little bit choppy in the back half of the year, but I still expect full year improvement for solutions at the margin level when all is said and done.

Tim Weiss, Analyst, Baird: Okay. Okay. And then how much price is going through your top line in both segments this year?

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: Yeah. Both segments are pretty consistent in the low single digit range. And that is what we saw in the second quarter. It’s also what I expect for the full year.

Tim Weiss, Analyst, Baird: Okay, great. Well, thanks a lot.

Conference Operator: The next question comes from Greg Burns with Sidoti and Company. Please go ahead.

Greg Burns, Analyst, Sidoti and Company: Good morning. I just wanted to kind of follow-up on the margin expectations for the Solutions segment in second half. I guess the guide is still implying I know you mentioned that you’re expecting for the year to be up I guess I don’t know by how much over 24%, but that would imply a decent decline in margin versus where you were for the whole of the first half. And it doesn’t seem like demand’s falling off broadly, especially in municipal. So production levels, I would expect, would be okay in the second half.

I’m just trying to get a better understanding of why you expect margins to decline appreciably from the first half and the second half.

Sarah Lauber, Executive Vice President and CFO, Douglas Dynamics: Yeah, I wouldn’t I don’t know that I would agree that it’s appreciably. I expect for the full year that we continue to improve the margin. It is going to be close to 24, but certainly in the low double digit range. I do think the back half of the year is going to be more difficult, clearly, as you’re speaking to from a comp perspective. But the shipment mix that I have expected for the back half of the year is not as great when think about sequential margins.

So they’ve been outperforming year to date. Could there be a little bit of that? I don’t know. We are not predicting that with the product mix that we’re expecting. What I’m pleased about, though, is that I really feel like we are stabilizing our margins in that segment at a higher level.

And when I think about the longer term, it can be lumpy quarter to quarter as we’re talking about it through the year. But the important thing is that we’re seeing that improvement and stabilization at the higher level.

Greg Burns, Analyst, Sidoti and Company: Okay, great. And then getting the acquisition engine going again, could you just maybe talk about what the pipeline looks like out there, you’re seeing, and maybe any particular areas of focus that you’d be looking to add to the portfolio? Thank you.

Mark Van Genderen, President and CEO, Douglas Dynamics: Yeah, absolutely. As we talk about that third area, our strategic area of focus of Activate, it’s what we’ve been spending a lot of time on because we’re now, as we noted in a position from a financial health standpoint, I think from a solid leadership standpoint, and really kind of a vision standpoint of saying, hey, what might be available. And as we look at where our strengths are as a company, we’re certainly I’d say we’ve got strengths really in two areas. One is in the manufacturing of attachments. That’s everything from engineering supply chain, optimizing operations, great sales and marketing.

We really lead the industry snow and ice. And then certainly over the last several years, improved and understood more as a company, how upfitting can be a part of that as well. What we’re really focused on now is in the attachment space. Our last couple of acquisitions have been more in the upfitting space. Really looking at the attachments and saying, hey, what are transferable, what are additional markets that our capabilities as a company, expertise as a company are transferable to.

So certainly we think about it as truck attachments kind of at the center of that bull’s eye. And then we look at other vehicle attachments. There’s a lot out there and we’re just at the beginning scratching the surface to understand it. Activating specific relationships, getting a better handle on what that looks like, and realizing where we could apply our strengths in engineering, operations, supply, sales and marketing against the backdrop of companies that are most likely outside of the snow and ice industry is really what we’re looking at right now.

Greg Burns, Analyst, Sidoti and Company: Great. Thanks.

Conference Operator: This concludes our question and answer session. I would like to turn the conference back over to Mark Van Genderen, President and CEO, for any closing remarks.

Mark Van Genderen, President and CEO, Douglas Dynamics: Yes, thank you. And thanks, everyone, for your time today. We appreciate your continued interest in Douglas Dynamics, and we look forward to talking with you soon.

Conference Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.

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