28.01.2009

Manitou up 1.4%

Manitou, the French based telehandler and aerial lift manufacturer, has reported final full year revenues for 2008 up by 1.4 percent to €1.26 billion. The results include two months contribution from the Gehl acquisition and if currency swings are removed, the increase is 1.8 percent – adding almost €25 million in revenues.

In Europe, strong sales in France, up seven percent and most other European Union countries, were offset by a collapse in the Spanish market where Manitou sales fell 75 percent, while the UK fell back 30 percent due to slower sales but also a weaker sterling translating into fewer Euros. Spain and the UK were Manitou’s largest export markets in 2007, accounting in total for 20 percent of the group’s sales.

Outside of Europe there were steep declines in the USA for both
Gehl – down 22 percent and Manitou down five percent, while sales in the rest of the world rose by 25 percent. Manitou sales were split between 39 percent in France and 61 percent export

Manitou says that it expects sales for the first quarter of 2009 to be down significantly on 2008 and given the unstable economic outlook and poor visibility on 2009, it will intensify the ‘rightsizing measures’ initiated last summer aimed at scaling back production capacity and reducing structural costs.

Full results will be published on April first.

Vertikal Comment

Manitou has been hit hard by its exposure to some of the worst affected markets for telehandler sales – its purchase of Gehl, while made for long term strategic reasons, will be both hindering and helping it at the moment.

On the one hand it increased its debt burden to purchase the company, at what looks now like a very high price, while on the other hand it will increase its US revenues without incurring the exchange rate risks that it would have faced had it increased its sales of French built units.

Gehl will also provide further opportunities to increase revenues by introducing its products to Manitou dealers. The company will need to spend more though on marketing its new and existing products if it is to benefit from this opportunity.

Manitou builds first class products, is a closely held public company and has a strong distribution chain, IF it can get its sales, marketing and distribution strategies right it could be a net beneficiary of the current recession.