29.08.2013

Profits evaporate at Manitou

Manitou has confirmed its first half revenues and announced its earnings for the period.

While revenues dropped 12 percent, thanks to steep declines in its industrial handling and telehandler divisions, last year’s net earnings of €21 million were cut to just €1.1 million this year. This was driven by a small loss in the industrial division - caused by the transition away from the Toyota joint venture to its own machines, and a break-even situation at the telehandler and access division – partially offset by profits in the USA with Gehl.

However as we reported in July, the company says that the second quarter was its strongest since 2008 and that it is making good progress. One highly positive number is net debt, which has been cut from €147.3 million last year to just €56.4 million this year. The company also expects the progress made in the second quarter to continue through the second half. Click here to see the earlier report on first half revenues

Chief executive Dominique Bamas said: “The first half was marked by the low level of invoicing at the beginning of the year that could only partially be recovered. The decrease in the business activity of the Rough Terrain Handling division and changes in the scope of the Industrial Material Handling division in France explain the fall in profitability we are seeing. The impact caused by the appreciation of the euro added to that.”

“The work achieved to boost sales, which bore its fruit in quarter two, will continue for the remainder of the year. The group’s refinancing, which was finalised in June, provides us new leeway to achieve greater responsiveness and flexibility.”

“Initiatives to improve our competitiveness will continue, with a more focused approach on decreasing our break-even point. With the benefit of a satisfactory order book at the end of June and the recent increase in production rates, we expect improved performance in the second half of the year. The second half will also be influenced by the dynamism of the rental companies in Europe and, above all, in North America."

Vertikal Comment

This earnings release confirms the indications that came out of its earlier revenue statement and our view then that the company is in far better shape than the revenue and profit numbers suggest.

One question remains is the permanence of chief executive Bamas, his appointment was originally on an interim basis, and he often talks of being responsible for a “transition in the group’s general management “. Regardless of when he decides to hand over, or if he stays longer, the company is almost certainly on track for a positive few years as the European economy continues to pick up.