28.11.2006

Manitowoc updates forecasts

Manitowoc, the crane, marine and food equipment group has confirmed that it will meet or exceed its earnings forecasts for 2006.

The company is looking at year end earnings per share of $2.7 to $2.75, around $170 million.

International sales will come in at $1.39 billion or roughly 50 percent of the group’s total revenues.

For 2007 the crane group, is expected to see further growth in revenues of around 20 percent which will take it up to around $2.7 billion, depending on how this year finishes up.
Operating income in percentage terms, will rise to around 13 percent.

Manitowoc’s two other sectors, are expected to fare less well, with Food service revenues predicted to increase in single digit percentages. While the marine business will remain in the doldrums,with flat revenues and little profit. Manitowoc said today that it now considers this to be a niche buisness and now one targeted for growth.

The net result will be that the crane business becomes an even more dominant part of the group, possibly topping 80 percent of its total revenues.

During the presentation today, the company said that having almost achieved all of its original "vision" it is working on "Vision 2010" setting out its goals and strategies for the next three to four years.

The vision will inlcude both organic growth and acquisitions.

Acquisitions in the food sector are preferred given that this business has only a marginal presence outside of North America and that it has a good number of product range infill work to do.

In terms of cranes, the presentation highlighted a number of opportunities for product line expansion, through acquisition and organic growth.

This included crawler cranes for the Asian markets, and a number of “adjacent opportunities” which might drive its acquisition policy. These included articulating loader cranes, telehandlers, reach stackers and dock cranes.

Manitowoc CEO Terry Growcock was quite specific when it came to aerial lifts, he said “We are a Lift solutions company and not interested in access solutions” When asked if Manitowoc had looked at JLG, he declined to comment.

The audience was shown the video of the new GTK1100 telescopic tower crane, as part of the presentation on innovation as a corner stone of the company’s strategy.

Glen Tellock, president of the crane group, said that this product would not be sold through the distributor network and had been identified as a direct sale product. With each region having a dedicated product specialist to handle its sale to major accounts.

Tellock do go on to say that in the end it would be the customer who would decide how he wanted to buy the product and given that Manitowoc has a large number of highly valued distributors, some will inevitably be involved in selling the GTK1100.

The first unit of the GTK1100 is said to be already on test and will be on the company’s stand at Bauma. Although it will not have a financial impact until the third quarter at the earliest and most likely only make a minimal contribution in 2007.

A further 21 new product development projects are on the drawing boards as the company goes into 2007.