Westport, Conn.-based Terex Corp. last week announced that it expects its earnings for 2008 to be approximately 5 percent below the low end of its previous full-year guidance of between $5.69 and $5.79 per fully diluted share. This revised guidance excludes charges associated with the reduction of production levels, asset impairments and certain other items. Comparable earnings for the full year 2007 were $5.85 per fully diluted share.
Although not yet finalized, the company expects to record a non-cash impairment charge of certain of the company’s goodwill, identifiable intangibles and other non-current assets principally related to its Construction, Roadbuilding and Utilities businesses. This impairment charge is estimated to be about $600 million, only a portion of which will be tax affected. The company says it is currently in compliance with all of the financial covenants under its bank credit facilities and indentures and the impairment charge will not affect its compliance.
“Our fourth-quarter 2008 results were affected by the rapid change in global economic conditions more than we anticipated, as well as continued input cost pressure,” said Terex chairman and CEO Ron DeFeo. “We continue to feel the negative effect that credit availability has on customer sentiment and demand for our products, particularly in our Construction, Materials Processing and Aerial Work Platforms businesses, as well as our smaller crane and tower crane product lines.
“In response to the present economic environment, we are taking and will continue to take aggressive actions to reduce costs and inventories in all of our businesses. We feel we have responded appropriately with significant actions already in progress, many of which we began late last summer and fall. Our actions include reductions in force, significantly curtailed production schedules in affected businesses, including temporary and permanent factory shutdowns, facility consolidations, the rescheduling of incoming raw materials and reducing executive compensation costs.”
Terex will release its fourth-quarter and year-end 2008 financial results on Wednesday, Feb. 11, after market close. The company will host a conference call to review the financial results on Thursday, Feb. 12, at 8:30 a.m. EST. DeFeo, along with other members of senior management, will host the call.
To access the call, dial 1-877-726-6603 on Feb. 12, at least 10 minutes before the call is scheduled to begin. International participants should dial 1-706-634-5517. A simultaneous webcast of this conference call will also be available at www.terex.com in the Investor Relations section of the website.
Terex Corp. is a diversified global manufacturer with 2007 net sales of more than $9.1 billion. Terex operates in four business segments: Terex Aerial Work Platforms, Terex Construction, Terex Cranes, and Terex Materials Processing & Mining.