21.02.2017

Challenging quarter for Genie

Genie – Terex AWP has reported its preliminary results for 2016 with further falls in revenues and profits.

Looking at the full year revenues were down over 12 percent to $1.98 billion, while operating profits slumped around 34 percent to $177.4 million. The set back due to lower replacement sales in North America, along with flat sales in Europe. The backlog/order book at the end of December was $506 million down from $570 million at the end of 2015.

In the fourth quarter sales dropped 17 percent to $379 million, while operating profits fell 55 percent to $18.2 million. The company expects a further 12 percent fall in revenues in 2017, but has confidence of medium term growth.

The slimmer Terex group as a whole saw full year revenues fall 11.5 percent to $4.4 billion, with a pre-tax loss of $27 million, compared to a profit for 2015 of $195.7 million. Net debt was reduced by 73 percent to $1.09 billion.

Terex chief executive John Garrison said: “Our fourth quarter results were in line with our expectations and reflect the challenging global market conditions. We have taken significant steps to better position Terex for the future. We completed the sale of our MHPS business, initiated major restructuring actions within our Cranes segment, and dramatically improved our balance sheet. We continue to implement our strategy, to focus and simplify the company, and build capabilities in key commercial and operational areas.”

“Looking ahead to 2017, we expect our primary global markets to remain challenging. We anticipate lower fleet replacement demand from North American AWP rental customers. The global Crane market remains challenging and we expect a further decline in 2017. We anticipate modest growth in our Materials Processing business. Combined with our cost reduction actions and capital structure improvements, we expect to deliver 2017 earnings per share of between $0.60 and $0.80, excluding restructuring, impact from our ownership interest in Konecranes, and other unusual items, on net sales of approximately $3.9 billion.”

Vertikal Comment

Sales remained slow in North America with little to no growth in Europe, the company has been busy restructuring its operations resulting in some major one off costs that cut profits substantially. While the first half of 2017 looks as though it might be much the same in terms of revenues, it is quite possible the the picture will change in the second half.

The company is still well placed to take advantage of any upturns in both North America and Europe.