The Manitowoc Co. last week reported sales of $721.9 million for the first quarter of 2010, down 29.7 percent from $1.0 billion in the first quarter of 2009. The sales decrease was primarily because of a 45.5-percent decline in the Crane segment, with flat sales in the Foodservice segment.
On a GAAP basis, the company reported a loss of $23.2 million, or $0.18 per diluted share, for the quarter versus a net loss of $655.8 million, or $5.04 per share, in the first quarter of 2009. Both periods included special items. Excluding special items, the adjusted loss from continuing operations was $9.9 million, or $0.08 per share, for the first quarter of 2010, versus adjusted earnings of $23.4 million, or $0.18 per share, in the first quarter of 2009.
“Although the operating environment during the first quarter of 2010 remained challenging, results for the seasonally soft quarter were in line with our expectations,” said Glen Tellock, Manitowoc’s chairman and CEO. “We saw pockets of strengthening demand in emerging markets, and signs that point toward further stabilization and gradual improvement in the second half of 2010. As expected, we are beginning to see increasing benefits from the operational efficiency, process improvements, and cost reduction initiatives we implemented during 2009.”
First-quarter 2010 net sales in the Crane segment were $366.8 million, down 45.5 percent from $672.9 million in the first quarter of 2009. First-quarter 2010 sales were 23.6-percent lower than fourth-quarter 2009 sales of $480.2 million. Crane segment operating earnings for the first quarter of 2010 decreased to $4.5 million from $56.5 million in the same period last year. Operating earnings were down $13.8 million from the fourth quarter of 2009, due primarily to lower sales volumes.
Crane segment backlog totaled $613 million as of March 31, an increase of 7.0 percent from the $573 million backlog at December 31, 2009.
“While the first quarter results reflect the difficult operating conditions we are facing, we reported our first sequential increase in quarterly backlog since June 2008,” said Tellock. “Consistent with last quarter, we are seeing some bright spots in emerging markets such as Asia, Latin America and the Middle East, which are being offset by continued weakness in North America and Western Europe as expected. Our strategy has not changed; we continue to focus on positioning this business for growth as we emerge from this downturn. We are also taking advantage of our position in emerging markets globally. We have maintained our efforts to strengthen our entire organization through operational efficiencies and cost management, while investing in areas that will drive the highest return over the long-term such as innovation and aftermarket support.”
Given first-quarter results that were in line with the company’s expectations, the company is reaffirming its full-year guidance for 2010. It expects year-over-year declines in Crane segment revenues to be significantly lower than the decline experienced in 2009. It expects Crane revenues in the first half of 2010 to be lower than the first half of 2009, Crane revenues in the second half of 2010 to be higher than the second half of 2009; and full-year Crane operating margins to be above the 3.5 percent trough margins that were experienced in 2003.
In addition, the company expects capital expenditures of approximately $50 million, depreciation and amortization of roughly $145 million and debt reduction of at least $200 million for full-year 2010.
Headquartered in Manitowoc, Wis., The Manitowoc Co. is a multi-industry, capital goods manufacturer with more than 100 manufacturing and service facilities in 27 countries. It is recognized as one of the world’s largest providers of lifting equipment for the global construction industry, including lattice-boom cranes, tower cranes, mobile telescopic cranes, and boom trucks.
