Net First Quarter Sales Decline Although New Products Strong for Manitowoc
Manitowoc reported first quarter orders of $488 million, an increase of 17 percent compared to the previous year, which the company attributed to new product innovation. However, first quarter 2017 net sales were $305.8 million compared to $427.4 million for the first quarter of 2016, a 39.8-percent tumble for the crane maker. The company’s loss from continuing operations in the first quarter was $36 million compared to $192.7 million in the first quarter of 2016.
“In the first quarter, we were pleased by the strong customer reception of our new products, many of which were highlighted at ConExpo,” said president and CEO Barry Pennypacker.”Nearly half of our equipment orders in the quarter were for products introduced since becoming a stand-alone crane company last year, which drove year-over-year and sequential orders up by 17 percent and 40 percent, respectively. Although the market has not shown signs of a sustained recovery, we are encouraged by the increased orders we booked in the quarter, and at this time reiterating our full-year financial guidance.
“Our first-quarter revenue was negatively impacted by the low level of backlog entering 2017, mainly due to historically low levels of crawler crane demand. In addition, our mobile crane business remains soft in the Americas and the Middle East as a result of continued low rental rates, weakness in used equipment prices and low oil prices, notwithstanding the increased activity in some of the American shale basins. Our tower crane business performed in line with our expectations, reflecting market share gains in key product lines.”
Pennypacker said despite the challenging market conditions, Manitowoc focuses on things it can control. “The relocation of our crawler crane production continues to proceed as planned; on time and within budget. Through judicious working capital management, we delivered improved cash flow from operational activities versus last year and ended the quarter with no outstanding borrowings on our ABL credit facility.”
About half of Manitowoc’s year-over-year decline was attributable to lower crawler crane shipments, with the remaining decline primarily because of lower sales in the Americas, partially offset by increases in Europe from strength in residential and commercial construction trends and new product introductions.
