13.3% div increase, but...Re 4th quarter. (And the outlook for the first half didn't sound very promising)
Manufacturing revenue increased by $13.3 million, or 2.4%, in comparison to 2017 Q4 primarily driven by higher average transit bus selling prices and a full quarter contribution from ARBOC, slightly offset by lower new and pre-owned coach average selling prices.
Aftermarket revenue decreased by $5.9 million, or 6.5%, compared to 2017 Q4, primarily due to lower volumes and a $1.2 million impact from lost parts sales as a result of Daimler's termination of MCI's Distribution Rights Agreement ("DRA") to sell and support German made Setra motor coaches in the U.S. and Canada.
Manufacturing Adjusted EBITDA decreased by $10.0 million, or 13.7%, due to lower coach and transit bus volumes, pricing pressure on new and pre-owned coach sales and startup losses incurred in the Shepherdsville parts fabrication facility (operated by NFI subsidiary, KMG Fabrication Inc. ("KMG")) of $3.4 million. These items were partially offset by improved margins for transit buses.
Aftermarket Adjusted EBITDA decreased by $0.5 million compared to 2017 Q4. The decrease is primarily due to the $0.6 million impact from termination of the DRA plus lower sales volumes offset by decreased sales and general and administrative ("SG&A") expenses.
Net earnings during 2018 Q4 decreased by $33.3 million, or 43.8%, compared to 2017 Q4, and Net Earnings per common share of NFI ("Share") decreased by $0.52. In addition to the EBITDA decrease, income tax expense increased by $16.9 million, interest expense increased by $7.5 million, as a result of strategic initiatives (including the acquisition of ARBOC and repurchases of Shares under the Company's NCIB), and depreciation increased by $2.0 million. The increase in income taxes was primarily due to the impact of U.S. tax reforms in December 2017 which resulted in a $9 million income tax recovery in 2017 Q4 which did not recur in 2018 Q4.
Adjusted Net Earnings during 2018 Q4 decreased by $37.2 million compared to 2017 Q4, primarily due to the previously mentioned impacts on Net Earnings. The decrease in 2018 Q4 Adjusted Net Earnings excludes the 2017 Q4 costs associated with corporate and strategic initiatives of $2.2 million and gain on bargain purchase of Sintex-Wausaukee Composites Inc., the Wisconsin based fiberglass reinforced polymer ("FRP") business acquired in 2017 Q4, both of which did not recur.