Strong Year for Genie Products Sets Pace for Terex in Decent First Quarter
Terex Corp. posted $1,292.5 million in first quarter 2024 revenue compared to $1,235.7 million in the first quarter of 2023, a 4.5-percent increase. Income from operations totaled $158.3 million compared to $147.7 million a year ago, a 7.2-percent jump.
Return on invested capital was 27.6 percent, up 370 basis points from the previous year.
“Terex delivered excellent first quarter results, achieving sales growth and margin expansion versus the previous year,” said Terex president and CEO Simon Meester. “The Terex team continues to perform at a high level and demonstrate the power of its focused strategy and its proven ability to create value. We are raising our full-year outlook to reflect our strong first quarter performance, while also prudently planning for continued softness in Europe over the balance of the year. Overall, customer demand remains strong for Terex’s differentiated products as evidenced by our robust backlog. In addition, we are advancing our new product initiatives to bolster the company’s portfolio of market-leading businesses that will continue to benefit from megatrends over the coming years. We are focused on accelerating our profitable growth strategy and are committed to delivering strong performance through the cycle.”
The increase in net sales was primarily driven by continued demand for products across multiple businesses.
The Aerial Work Platforms division, the Genie brand, particularly important to the equipment rental industry, posted net sales of $772.7 million, a 12.7-percent increase compared to Q123, primarily driven by higher demand, as well as improved supply chain and manufacturing performance. Income from operations increased to $107.3 million or 13.9 percent of net sales, compared to $85.3 million or 15.4 percent of net sales in the first quarter a year ago. The decrease was primarily the result of incremental profit achieve on higher sales volume, improved manufacturing throughput and disciplined price-cost management.
The Materials Processing Division posted net sales of $520 million, a 33.8-percent decline, primarily driven by lower end-market demand for material handling equipment and cranes in Europe, partially offset by growth for aggregates in North America. Income from operations decreased to $72.1 million or 13.9 percent of net sales, compared to $85.3 million, or 15.4 percent of net sales, in the prior year. The decrease was primarily the result of the impact of lower sales volume and net unfavorable product mix.
“We expanded total company operating margin by 20 bps compared to last year and delivered ROIC of more than 27 percent,” said Julie Beck, senior vice president and chief financial officer. “We expect a significant step-up in free cash flow over the balance of the year and remain on-track to generate more than $300 million of free cash flow for a second consecutive year. The strength of our balance sheet and expected cash flow provide significant capacity to fuel our strategic growth initiatives and return capital to shareholders.”
