30.04.2014

Terex Cranes slips into the red

Terex Cranes has reported a poor first quarter, with sales dropping 16 percent causing the company to post an operating loss for the period.

Total revenues were $393.6 million, almost 16 percent lower than in the same quarter last year, while operating income dropped from $32.5 million last year to a loss of $200,000 this year. However there was some positive news in the order intake for the period, with the order book jumping 34 percent in the quarter to $673.4 million over six percent higher than it was at this point in 2013.

The Terex group as a whole reported a hike in pre-tax profits of more than
32 percent to $43 million, on flat revenues of 1.65 billion.

Chief executive Ron DeFeo said: “We remain encouraged by the performance of our Aerial Work Platform segment, which delivered excellent results in the first quarter. Performance across our remaining businesses was mixed. The Materials Processing, Construction and Material Handling & Port Solutions segments all delivered quarters roughly in-line with our expectations. While both the MHPS and Construction segments had an operating loss in the quarter, we planned for and continue to expect better operating results from these businesses for the balance of 2014. Our Cranes segment had a disappointing first quarter, but recent order trends suggest improvements as the year progresses, particularly in the second half of the year.”

“The Company’s overall outlook for 2014 has not changed. We expect continued strength from AWPs and improvement from our other segments throughout the remainder of 2014. We reiterate our annual outlook for net sales of between $7.3 billion and $7.7 billion. Terex remains focused on improving profit through organic means, integrating the businesses more thoroughly, and generating free cash flow.”

Vertikal Comment

Clearly this was a very disappointing quarter for Terex Cranes, however it looks as though this might be due to the timing of order intake? The fact that the backlog is growing again is positive. The next quarter should be a good deal better, the key thing to watch out for though will be the backlog at the end of June.

Terex is facing some strong competition from Liebherr and Manitowoc and if that is not enough Tadano is also gathering steam, both in North America and some Key European markets. Terex Crane president Tim Ford still has some way to go before the cranes division can be said to be ‘cooking on gas’.