09.02.2023

Strong quarter for Genie

Genie and Terex have reported the fourth quarter and full year results with an upward trend towards year end.

Full year numbers
Genie recorded a 14 percent increase in revenues for the year to $2.48 billion, while order intake grew a little faster pushing the backlog/order book at the end of December to $2.49 billion - up 27 percent on the year and not that far below the 2023 sales projections. Operating profit for the period increased 28 percent to $196.2 million.

Fourth Quarter
The trend gather pace in the fourth quarter, with revenues growing by 25.7 percent to $671.8 million - up 32 percent at constant exchange rates. Operating profits more doubled to $54 million.

Terex as a whole
Terex as a whole saw full year revenues improve 13.7 percent to $4.42 billion, with a pre-tax profit of $366.6 million, up 39 percent on 2021. No mention was made of the Terex Crane operations which are now part of the Material Processing division.

Terex chief executive John Garrison said: “The fourth quarter marked an excellent finish to a strong year for Terex. We successfully navigated complex global macro dynamics to deliver significant revenue and earnings growth. I would like to thank the Terex team members for their hard work, dedication, and resilience in managing through this environment. Our 2022 results showcase the strength of our portfolio of diverse market leading businesses and our continued leadership in attractive growth markets."

"We were able to achieve price cost neutrality for the full-year, despite global supply chain disruptions and considerable inflationary pressures. We entered 2023 with backlog of $4.1 billion, an increase of 22% year over year, clearly showing strong demand from our customers. Our globally recognised brands, industry leading and innovative new products, robust backlog, and balance sheet position us well to manage our business amidst continued macroeconomic volatility. We expect 2023 sales to be between $4.6 and $4.8 billion."

Vertikal Comment

This is a decent set of numbers from Terex and Genie, buoyed by a strong market, and limits on most competitors ability to increase production, all of which helps higher revenues drop through to the bottom line.
The unknown issue though is market share, which is certainly a little less positive.
Several of the top 10 aerial lift suppliers barely existed a decade or two ago and are not only growing fast, but also gaining sufficient customer confidence in the quality and reliability of their products to be gaining traction in the larger scissor and boom lift markets.
At the moment there is more than enough business to go around, the question is what happens when the next downward cycle arrives, as inevitably it will.

In spite of this Genie’s big competitor remains JLG, which posted slightly higher full year revenue growth in percentage terms, but slower profit growth than Genie. However, JLG outpaced Genie in the fourth quarter, both in terms of revenue and profit growth. But as mentioned the real competitive danger lies elsewhere.