EX99.1 Q3 2014

Net sales for the third quarter of 2014 were $233.2 million compared to net sales of $174.7 million for the third quarter of 2013, an increase of 33%. Net income for the quarter rose 18% to $13.4 million, or $1.10 per diluted share, versus net income of $11.3 million, or $0.93 per diluted share, for the same period of 2013. Both net sales and net income for the quarter were records for Alamo Group. The results for the quarter included the effects of recent acquisitions, primarily the units of Specialized, which Alamo completed in May of this year and to a lesser extent Kellands, a UK company acquired in April, 2014 and two Australian companies, Superior and Fieldquip, acquired in September, 2013 and April, 2014, respectively. A summary outlining the effects these acquisitions had on the Company’s results is included as Attachments 1 and 2 to this earnings release. Excluding these acquisitions, net sales for the quarter were $187.4 million, an increase of 7% ⁽¹⁾.

Net sales for the Company’s North American Industrial Division in the third quarter of 2014 were $126.0 million compared to $71.9 million in the prior year’s third quarter, an increase of 75%. For the nine month period ending September 30, 2014, net sales for the Division were $308.3 million compared to $218.9 million in 2013, an increase of 41%. The Division’s results include the effect of the acquisition of the Specialized units. Excluding this acquisition, net sales for the Division were up 17% in the third quarter of 2014 and 13% for the nine month period ⁽¹⁾.

The Company’s North American Agricultural Division reported net sales of $57.7 million in the third quarter of 2014, versus $61.2 million in the previous year, a decrease of 6%. This reflects the continued weak conditions in the overall U.S. agricultural market. For the first nine months of 2014, net sales in this Division were $160.1 million versus $168.0 million in 2013, a decrease of 5%. The acquisitions of Superior and Fieldquip are included in this Division’s results. Excluding these acquisitions, net sales in the Division were down 7% in the third quarter and 7% for the nine month period ⁽¹⁾.

Alamo Group’s European Division net sales for the third quarter of 2014 were $49.6 million, an increase of 19% compared to net sales of $41.7 million in the previous year. For the first nine months of 2014 net sales in the Division were $142.3 million versus $124.3 million in 2013, an increase of 14%. The Division’s results include the effect of the acquisition of Kellands. Excluding this acquisition, net sales in the Division were up 13% in the third quarter and 10% for the nine month period ⁽¹⁾. These results reflect continued improvement in demand for the Company’s products in Europe despite weak overall market conditions and were further aided by changes in exchange rates.

Alamo Group’s President and Chief Executive Officer, Ron Robinson, commented, “We were pleased to see our third quarter rebound from the weak second quarter results. We feel this quarter’s results more fully exhibit the positive contribution the units of Specialized should have on Alamo’s results going forward. In the second quarter this potential was obscured by transactional costs and being part of Alamo for less than half of the quarter, but in the third quarter this potential was more fully revealed.

“However, our third quarter results were about more than just Specialized. Excluding acquisitions our Industrial Division showed strong progress with sales continuing to benefit from solid demand for our infrastructure maintenance products. We believe these same factors helped drive the growth experienced by our European Division as well. Our organic growth in Europe was particularly satisfying given the ongoing weak economic environment that still pervades that market in general. And while our North American Agricultural Division sales were down, the Division showed more strength than many other companies in this sector. We were much more proactive in managing this Division’s costs to ensure they did not impact Alamo’s overall results as negatively as they did in the second quarter.

“As a result we were able to deliver sales and earnings results at record levels for the third quarter making it the strongest quarter ever for Alamo Group. We feel this is a particularly noteworthy accomplishment given weak market conditions in both agriculture and Europe. Even our Industrial unit results were negatively affected by a $1.1 million non-cash pre-tax charge relating to the sale of acquired Specialized inventory which was subject to a step up to fair value in the initial purchase price allocation. This was recognized as additional cost of goods sold during the quarter. These step ups will affect our earnings, but not our cash flow, for the next few quarters. To be able to produce the results achieved despite the headwinds indicated above, we believe shows the true strength of Alamo Group, a strength that gives us confidence in our future.”

The live broadcast of Alamo Group Inc.’s quarterly conference call will be available online at the Company's web site, www.alamo-group.com (under “Investor Relations/Events & Presentations”) on Thursday, November 6, 2014, beginning at 10:00 a.m. CT. The online replay will follow shortly after the call ends and will be archived on the Company’s website for 60 days.

Alamo Group is a leader in the design, manufacture, distribution and service of high quality equipment for infrastructure maintenance, agriculture and other applications. Our products include truck and tractor mounted mowing and other vegetation maintenance equipment, street sweepers, snow removal equipment, excavators, vacuum trucks, other industrial equipment, agricultural implements and related after-market parts and services. The Company, founded in 1969, has approximately 3,100 employees and operates 24 plants in North America, Europe and Australia as of September 30, 2014. The corporate offices of Alamo Group Inc. are located in Seguin, Texas and the headquarters for the Company’s European operations are located in Salford Priors, England.

This release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company’s actual results in future periods to differ materially from forecasted results. Among those factors which could cause actual results to differ materially are the following: market demand, competition, weather, seasonality, acquisition risks, currency-related issues, and other risk factors listed from time to time in the Company’s SEC reports. The Company does not undertake any obligation to update the information contained herein, which speaks only as of this date. This release may contain non-GAAP financial measures. These measures, if included, are to help facilitate meaningful comparisons of our results to those in prior periods and future periods and to allow a better evaluation of our operating performance, in management’s opinion. Our reference to any non-GAAP measures should not be considered as a substitute for results that are presented in a manner consistent with GAAP.

⁽¹⁾In this earnings release, Alamo Group reports net sales excluding the impact of the acquisitions which is a non-GAAP financial measure. The Company considers this information useful to investors to allow better comparability of period-to-period operating performance. Attachments 1 and 2 to this earnings release contains a revenue reconciliation of the non-GAAP financial measure to the comparable GAAP financial measure.

(Unaudited)



	September 30, 2014			September 30, 2013
ASSETS
Current assets:
Cash and cash equivalents		$	38,644		$	53,603
Accounts receivable, net		178,072			161,704
Inventories		183,797			121,639
Other current assets		13,761			11,128
Total current assets		414,274			348,074

Rental equipment, net		28,927			—

Property, plant and equipment		72,416			60,633

Goodwill		71,996			31,814
Intangible assets		62,028			5,500
Other non-current assets		4,699			3,623

Total assets		$	654,340		$	449,644

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable		$	68,701		$	55,911
Income taxes payable		3,111			1,869
Accrued liabilities		44,391			36,170
Current maturities of long-term debt and capital lease obligations		852			499
Other current liabilities		884			243
Total current liabilities		117,939			94,692

Long-term debt, net of current maturities		190,005			90
Deferred pension liability		1,264			8,248
Other long-term liabilities		3,843			3,710
Deferred income taxes		3,825			2,705

Total stockholders’ equity		337,464			340,199

Total liabilities and stockholders’ equity		$	654,340		$	449,644



	Third Quarter Ended						Nine Months Ended
	9/30/2014			9/30/2013			9/30/2014			9/30/2013
North American
Industrial	$	125,952		$	71,890		$	308,348		$	218,863
Agricultural	57,668			61,157			160,144			168,048
European	49,555			41,691			142,286			124,320
Total net sales	233,175			174,738			610,778			511,231

Cost of sales	177,735			131,582			469,922			389,072
Gross margin	55,440			43,156			140,856			122,159
	23.8		%	24.7		%	23.1		%	23.9		%

Operating expenses	33,914			27,830			93,903			79,533
Income from operations	21,526			15,326			46,953			42,626
	9.2		%	8.8		%	7.7		%	8.3		%

Interest expense	(1,497		)	(319		)	(2,780		)	(897		)
Interest income	41			44			137			129
Other income (expense)	421			558			1,048			1,190

Income before income taxes	20,491			15,609			45,358			43,048
Provision for income taxes	7,124			4,276			15,558			12,978

Net Income	$	13,367		$	11,333		$	29,800		$	30,070

Net income per common share:

Basic	$	1.11		$	0.94		$	2.47		$	2.50

Diluted	$	1.10		$	0.93		$	2.43		$	2.47

Average common shares:
Basic	12,050			12,069			12,077			12,040

Diluted	12,206			12,229			12,251			12,196

From time to time, Alamo Group Inc. may disclose certain “non-GAAP financial measures” in the course of its earnings releases, earnings conference calls, financial presentations and otherwise. For these purposes, “GAAP” refers to generally accepted accounting principles in the United States. The Securities and Exchange Commission (SEC) defines a “non-GAAP financial measure” as a numerical measure of historical or future financial performance, financial positions, or cash flows that is subject to adjustments that effectively exclude or include amounts from the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures disclosed by Alamo Group are provided as additional information to investors in order to provide them with greater transparency about, or an alternative method for assessing, our financial condition and operating results. These measures are not in accordance with, or a substitute for, GAAP and may be different from, or inconsistent with, non-GAAP financial measures used by other companies. Whenever we refer to a non-GAAP financial measure, we will also generally present the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable GAAP financial measure.

In this earnings release, Alamo Group reports each of net sales, operating income and net income excluding the impact of acquisitions which are non-GAAP financial measures. The Company considers this information useful to investors to allow better comparability of period-to-period operating performance. Attachment 1 to this earnings release contains a revenue reconciliation of these non-GAAP financial measures to the comparable GAAP financial measure. Attachment 2 discloses Adjusted Operating Income, Adjusted Net Income, Adjusted Diluted EPS each adjusted to exclude the impact of inventory step up charge and transaction costs connected to the acquisitions and additional stock expense related to the accelerated vesting options to retirement eligible recipients, all of which are non-GAAP financial measures. The Company believes that providing Operating Income and Net Income exclusive of these adjustments, is useful to investors to allow better comparability of period-to-period operating preference. Attachment 2 sets forth a reconciliation of each such non-GAAP financial measure to its most directly comparable GAAP measure.



	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2014			2013			2014			2013

Net Sales (consolidated) - GAAP	$	233,175		$	174,738		$	610,778		$	511,231
(less: net sales attributable to acquisitions)	(45,760		)	(223		)	(70,133		)	(223		)
Net Sales less acquisitions (consolidated) - non-GAAP	$	187,415		$	174,515		$	540,645		$	511,008

Net Sales (N.A. Industrial Division) - GAAP	$	125,952		$	71,890		$	308,348		$	218,863
(less: net sales attributable to acquisition)	(42,099		)	—			(61,076		)	—
Net Sales less acquisitions (N.A. Industrial Division) - non-GAAP	$	83,853		$	71,890		$	247,272		$	218,863

Net Sales (N.A. Agricultural Division) - GAAP	$	57,668		$	61,157		$	160,144		$	168,048
(less: net sales attributable to acquisitions)	(1,190		)	(223		)	(3,304		)	(223		)
Net Sales less acquisitions (N.A. Agricultural Division) - non-GAAP	$	56,478		$	60,934		$	156,840		$	167,825

Net Sales (European Division) - GAAP	$	49,555		$	41,691		$	142,286		$	124,320
(less: net sales attributable to acquisition)	(2,471		)	—			(5,753		)	—
Net Sales less acquisitions (European Division) - non-GAAP	$	47,084		$	41,691		$	136,533		$	124,320


Operating Income (consolidated) - GAAP	$	21,526		$	15,326		$	46,953		$	42,626
(less: operating income attributable to acquisitions)	(3,862		)	6			(6,198		)	6
Operating Income less acquisitions (consolidated) - non-GAAP	$	17,664		$	15,332		$	40,755		$	42,632

Net Income (consolidated) - GAAP	$	13,367		$	11,333		$	29,800		$	30,070
(less: net income attributable to acquisitions)	(2,212		)	8			(3,509		)	8
Net Income less acquisitions (consolidated) - non-GAAP	$	11,155		$	11,341		$	26,291		$	30,078



	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2014		2013		2014		2013

Operating Income - GAAP	$	21,526	$	15,326	$	46,953	$	42,626
(add: inventory step charge)	1,139		—		1,139		—
(add: transaction costs relating to acquisitions)	131		—		1,839		—
(add: stock option expense)	—		—		1,015		—
Adjusted Operating Income - non-GAAP	$	22,796	$	15,326	$	50,946	$	42,626

Net Income - GAAP	$	13,367	$	11,333	$	29,800	$	30,070
Adjustments (after tax):
(add: inventory step charge)	724		—		724		—
(add: transaction costs relating to acquisitions)	83		—		1,169		—
(add: stock option expense)	—		—		645		—
Adjusted Net Income - non-GAAP	$	14,174	$	11,333	$	32,338	$	30,070

Diluted EPS - GAAP	$	1.10	$	0.93	$	2.43	$	2.47
(add: inventory step charge)	0.06		—		0.06		—
(add: transaction costs relating to acquisitions)	—		—		0.10		—
(add: stock option expense)	—		—		0.05		—
Adjusted Diluted EPS - non-GAAP	$	1.16	$	0.93	$	2.64	$	2.47



	For:	Alamo Group Inc.

	Contact:	Robert H. George
		Vice President
		830-372-9621
For Immediate Release
		Financial Relations Board
		Marilynn Meek
		212-827-3773


◦	North American Industrial Division up 75% with addition of Specialized units