25.07.2012

Terex AWP up 38 percent

Terex AWP/Genie has reported first half revenues up 38 percent with substantially improved margins.

Total revenues for the six months were $1.19 billion, 38 percent higher than in the same period last year, while operating income almost quadrupled to $125.8 million, thanks to price increases and higher volumes partially offset but higher input costs..

The backlog/order book at the end of June was $511 million, down 24 percent on the quarter, but 14 percent higher than a year ago.

Looking at the second quarter sales grew by almost 25 percent to $605.7 million while operating income tripled to $83.2 million. Increased replacement-based demand from North American rental companies and a strong Australian market were the two most significant factors in the strong growth.

Terex as a whole saw revenues for the six months climb almost 40 percent to $3.83 billion. Pre-Tax profits at $155 million were almost six times that of 2011 when profits were just $26.7 million.

In the second quarter sales grew 35 percent to $2.01 billion, while pre-tax profits were up 750 percent to $124.6 million.

Terex chief executive Ron DeFeo said: “We had a strong second quarter, this year’s focus has been to improve margins, generate cash and integrate Demag Cranes AG. We are on or ahead of expectations in these categories. Our historical businesses continued to grow with improved price realisation and reduced expenses due to actions taken in the prior year. Consequently, the overall operating margin increased significantly. Our Aerial Work Platforms and Cranes segments had strong performances and are well positioned for continued improvement in the second half of the year.”

“In evaluating the second half outlook, we are encouraged by the balance in our business and despite concerns in Europe and foreign currency headwinds we expect to achieve earnings for the full year of $1.95 to $2.05 per share on sales of $7.5 to $7.8 billion."

Vertikal Comment

An exceptionally strong performance from Genie/Terex-AWP both in terms of sales, production and margins. Clearly the price increases from the start of this year are not only ‘sticking’ but do not appear to have dampened demand too much, although the 24 percent fall in the backlog during the second quarter is a little concerning – even though it is nicely up on the same point last year and the fall is driven by increased production which has taken revenues almost back to 2008 levels.

All in all a very strong result which sets the business up for a very strong year.