The Manitowoc Company (NYSE: MTW) last week reported sales of $876.5 million for the second quarter of 2010, down 12.4 percent from $1.0 billion in the second quarter of 2009. The sales decrease was due primarily to a 31-percent decline in Crane segment sales, partially offset by an 11-percent increase in Foodservice segment sales.
On a GAAP basis, the company reported earnings of $14.1 million, or $0.11 per diluted share, for the quarter versus a net loss of $12.3 million, or $0.09 per share, in the second quarter of 2009. Both periods included special items. Excluding special items, the adjusted earnings from continuing operations were $15.7 million, or $0.12 per share, for the second quarter of 2010, versus adjusted earnings of $29.9 million, or $0.23 per share, in the second quarter of 2009.
“Despite the prolonged challenges presented by the state of the global economy, we maintained our focus on executing against our goals during the second quarter of 2010,” said Glen Tellock, Manitowoc's chairman and CEO. “As a result, we were able to deliver results consistent with our expectations. Emerging markets continue to be encouraging for both of our businesses. While some recent positive indicators suggest a stabilization in certain mature markets, we remain guarded as we move into the second half of 2010. At the same time, we continue to drive the operational efficiencies, process improvements, and cost reduction initiatives we implemented last year, which should provide enhanced profitability as demand strengthens across our business.”
Second-quarter 2010 net sales in the Crane segment were $451.6 million, down 31 percent from $652.3 million in the second quarter of 2009. Second-quarter 2010 sales were up 23 percent from first-quarter 2010 sales of $366.8 million.
Crane segment operating earnings for the second quarter of 2010 decreased to $38.6 million from $49.5 million in the same period last year. Operating earnings were up $34.1 million from the first quarter of 2010, due primarily to higher volumes, product mix, and favorable receivable collection activity. This resulted in Crane segment operating margins of 8.6 percent for the second quarter of 2010, up from 7.6 percent in the same period in 2009, and up from 1.2 percent in the first quarter of 2010.
Crane segment backlog totaled $531 million as of June 30, a decrease of 13.4 percent from the $613 million backlog at March 31. The decrease in backlog during the second quarter was due to higher shipment activity, currency impact, and a sizable order removed from backlog due to persistent financing challenges in the current credit markets.
“The second-quarter Crane segment results illustrate the continuing challenges of the current economic environment in which we operate,” said Tellock. “However, our focus on operational improvements and execution drove a notable improvement in operating margins during the quarter, which helped offset the weakness in global demand. Similar to prior quarters, emerging markets such as Asia, Latin America, and the Middle East demonstrated positive signs of improvement, while demand in the developed economies of North America and Europe continues to be weak. While we have seen modest improvements in utilization rates and significant reductions in dealer inventories in developed markets, rental rates continue to be soft. Nevertheless, we remain focused on executing on the opportunities we see in emerging markets that we anticipate will drive both near- and intermediate-term results for our Crane business.”
The Manitowoc Co., Manitowoc, Wis., is a multi-industry, capital goods manufacturer with more than 100 manufacturing and service facilities in 23 countries. It is 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.
