Mayville Engineering Co Inc (STU:2YN)

Q2 2026 Mayville Engineering Company Inc Earnings Call Transcript

Aug 5, 2026 / 02:00 PM GMT

Release Date Price: €22 (-7.56%)

Transcript 10-Q8-K

Key Points

Positve

Mayville Engineering Co Inc (MEC) delivered strong second-quarter results with total sales increasing 23.2% year-over-year, exceeding expectations.
The company is experiencing robust growth in the data center and critical power market, with organic growth of approximately 173% year-over-year and a qualified opportunity pipeline exceeding $125 million.
Mayville Engineering Co Inc (MEC) successfully completed a common stock offering, generating approximately $94 million in net proceeds to strengthen its balance sheet and enhance financial flexibility.
The commercial vehicle market is showing signs of recovery, with a projected 9.1% increase in Class 8 production for 2026 and a further 9.7% increase in 2027, supported by new program wins tied to 2027 EPA regulations.
Mayville Engineering Co Inc (MEC) secured approximately $40 million in new data center and critical power awards during the quarter, providing strong visibility into future revenue growth beginning in 2027.
The company is making disciplined portfolio decisions, prioritizing higher-margin opportunities and exploring capacity reservation models with customers to support margin expansion.

Negative

Mayville Engineering Co Inc (MEC) incurred $2.1 million in data center and critical power-related project launch costs during the quarter, which negatively impacted adjusted EBITDA margin.
The company expects to recognize an additional $2 million to $3 million in outsourcing costs in the second half of the year due to equipment constraints and labor shortages.
Free cash flow was a use of $6.6 million in the second quarter, a significant decrease from $12.5 million provided in the prior year period, driven by lower operating cash flow and increased capital expenditures.
Net debt increased to $134.7 million from $71.8 million at the end of the second quarter of 2025, with a bank covenant net leverage ratio of 2.9 times.
Power sports net sales decreased approximately 6% year-over-year due to softness in legacy ATV, UTV, and motorcycle OEMs resulting from ongoing offshoring initiatives.
The company faces labor constraints in key manufacturing locations, with unemployment rates as low as 2.3% in Defiance, Ohio, and 2.9% in Mayville, Wisconsin, making it challenging to fill positions and ramp up production.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

MEC.N - Mayville Engineering Company Inc
Q2 2026 Mayville Engineering Company Inc Earnings Call
Aug 05, 2026 / 02:00PM GMT

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Presentation
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Unidentified_1 [1]
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Hello, everyone.

Thank you for joining us and welcome to the 20,262 quarter Navale Engineering Company earnings call.

After today's prepared remarks, we will host a question-and-answer session.

If you would like to ask a question, please press 1 to raise your hand.

To withdraw your question, pressar 1 again.

I will now hand the conference over to Stephan Neely with Vallum advisors.

Please go ahead.

Thank you, operator, on behalf of our entire team, I'd like to welcome you to our second quarter 2026 results conference call.

Leading the call today is Mex President and CEO Jack Reddy and Rochelle Lehr, Chief Financial Officer.

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