04.05.2009

Skyjack down 60%

Skyjack owner Linamar has reported a 60 percent fall in first quarter revenues at its industrial division – largely Skyjack – to a C$51.4 million ($43.3 million). The division reported an operating loss of C$500,000 ($421,000) compared to a profit of C$19.3 million ($16.2 million) in the same period last year.

Linamar as a whole saw revenues fall 31 percent to C$425 million ($358 million) while profits slumped to a loss of C$12.6 million ($10.6 million) compared to a profit of C$29.5 (24.8) million last year. C$11.7 ($9.9) million of the loss was due to a non cash write down of goodwill.

The group generated a positive cash flow of C$72.8 ($61.4) million and had C$249.6 million of credit available on its revolving credit line, C$32.3 million more than at the end of 2008. In April the company withdrew C$100 million from this credit line in order to repay $80 million of loan notes due in October.

Linamar chief executive Linda Hasenfratz said: "Despite quarter one 1 being one of the most difficult economic periods to manage through in our company's history, Linamar has managed to dramatically increase market share, execute on significant cost savings and generate more than $30 million of cash to pay down debt levels. We have a plan, are successfully executing on such and seeing the results."

Vertikal Comment

While a negative result, Skyjacks performance is possibly the best of the top four aerial lift producers. The modest loss reflects on the fact that Skyjack was the first of the four to start trimming costs and cut capacity early on in 2008.

The company has also continued to sell some reasonable volumes in markets that the other producers are declaring as “completely dead”. The biggest challenge the company faces if persuading buyers to try its new boom models at a time when the established producers have inventory and some excellent deals and in an atmosphere where buyers ere to the cautious.

A surprise for detractors is how well the rest of the group is doing, given that it earns its keep from the automotive sector which has been hit almost as hard as the self propelled aerial lift industry.

Some competitor employees assumed that the group would be on its knees and were ready to forecast the demise of Skyjack. Looks like they had better think again and look to the future of their own companies.