25.07.2012

Terex Cranes gains momentum

Terex Cranes has reported a 4.5 percent increase in first half revenues and improved margins.

Revenues for the six months were $903.6 million – up 4.5 percent on the same period last year, while operating profits were $50.8 million, compared to a $56.5 million loss in the first half of 2011.

In the second quarter sales rose by a similar percentage to $884.2 million, while operating income was $43.5 million compared to a loss last year of $34 million. The sales gain would have been 12 percent on constant exchange rates, but the weaker Euro means results translate into fewer dollars.

The backlog/order book at the end of June was $841 up 10 percent on the quarter, although down marginally on June 2011. Demand for Rough Terrain cranes remains high, while sales and order intake for All Terrain cranes has also picked up.

The port equipment business will move out of the crane division this month and join the Demag – Material Handling/Port Services division.

The seperate Demag port and overhead crane business generated revenues for the six months of $728.5 million with operating profits of $14.7 million.

The Terex group 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

A solid performance that was better in reality than the dollar numbers suggest, Terex Cranes has done well in terms of both sales and profitability. The business is continuing to make progress and should see an even stronger second half.

A positive result with more to come.