20.05.2015

PM & ASV boost Manitex

Crane and access manufacturer Manitex has reported an almost 70 percent jump in revenues, thanks to the incorporation of the PM group and ASV acquisitions.

Total revenues were $105.9 million, of which $48.6 million came from the new acquisitions, the rest of the business saw revenues fall 8.5 percent, to 57.3 million, partially due to Euro revenues translating into fewer dollars and lower sales of Manitex boom trucks. Pre-tax profits were just $143,000 compared to $2.8 million in the same quarter last year.

PM loader crane sales in the quarter improved in most regions, but particularly in the Americas and Europe. At the same time, sales of Manitex boom trucks of 40 tons or more, declined due to lower demand from the energy sector.

Chief executive officer, David Langevin said: "We have brought together an exceptional portfolio of specialised industrial equipment businesses and are making good progress integrating our most recent acquisitions. This was the first quarter in which we have included both ASV and PM group in our results, and as expected, our financials have changed significantly, with revenues now running at over $100 million per quarter.

"The opportunity to add PM knuckle boom cranes to our North American assembly operations and market throughout our dealer network remains a top priority for this year and beyond, and we're excited about growing this business. ASV also remains an exciting opportunity for us, with modest improvement in US construction markets expected this year, which will benefit ASV's performance. Given continued global economic softness, we are concentrating our efforts on optimizing our cost structure and allocating resources to our higher margin business units that we believe will drive our future growth."

Chief operating officer Andrew Rooke added: “Our cost reduction programme announced at the end of last year, picked up steam during the quarter and had a positive impact, helping to offset the gross margin effect of some adverse sales mix, and we are on track to achieve the $4 million goal set for 2015. The recent expansion of the company through the acquisition of ASV and PM has increased our leverage and we have rapidly attacked our debt, making principal repayments of $2.8 million, including a $1.5 million advance payment in March to satisfy all 2015 principal payments on the PM acquisition term loan. Our objective is continue to pay off debt through working capital improvements during 2015 and beyond, with the objective of returning our balance sheet ratios in time back to our normalized levels."

Vertikal Comment

It looks as though the PM acquisition came in the nick of time for Manitex, which is suffering from the downturn in the boom truck market, before it has managed to get the most out of the acquisitions such as Valla etc… 2015 will probably be a bumpy year as the group gets better organised and integrates its acquisitions. It really needs a year or two without any further distractions to weld the whole into an efficient crane, aerial lift and specialist material handling business.

The company has some excellent products in its portfolio, but needs to add finance and consistency to some, and marketing and distribution flair to others. If it can do this it will emerge as a major player in the crane and access market in time to benefit from the improving worldwide economic cycle.