07.08.2017

Manitex rebounds

Crane manufacturer Manitex has reported a solid improvement in sales and order intake following its restructuring.

Since last year the company has sold its marine handling business, half its shares in the ASV joint venture, closed its used equipment trading operation and ended plans to build a national rental fleet for its products in the USA. Total revenues for the first six months on a prorate basis were 13 percent lower at $91.4 million, with a pre-tax loss of $4.8 million, compared to a loss of $5.4 million in the same period last year.

Moving on to the second quarter sales were 6.5 percent higher at $51.9 million, while order intake remained strong, with the order book at the end of June being 74 percent higher than this time last year, although down slightly (7.2%) on the quarter. The company made a pre-tax loss of 1.39 million compared to a $4.5 million loss last year. Total debt at the end of the period was 2.5 percent lower at $93.1 million.

Chief executive David Langevin said: “The increased order rate that began at the end of 2016 enabled us to achieve much improved results from top to bottom in the second quarter of 2017. While there remains much work to do to optimise our production and margins, we are optimistic that this year represents the beginning of a healthy uptrend for our markets and Manitex as we are well-positioned to execute our plan. In May we took another step forward in our debt reduction program by selling approximately half of our holdings in the ASV joint venture and using the proceeds from this transaction to pay down debt. Our reduced ownership percentage enabled us to deconsolidate the ASV debt from our balance sheet, and together with proceeds and cash generation, we have reduced total debt to under $100 million. We maintain ownership of approximately 2.1 million shares of the now public ASV entity, which we believe will prove an excellent long-term investment for our shareholders. With that behind us, we have shifted our focus to growing PM, our international knuckle boom business and recently announced the appointment of several key North American distributors for that product line subsequent to the end of the second quarter. We have begun producing PM units here in North America, and we are working diligently to integrate the entire PM operation onto the Manitex platform.”

“Further our Adjusted EBITDA doubled compared to last year’s same quarter and we also saw a significant recovery in our adjusted gross margins. Given the long-awaited recovery of the order book that we continue to enjoy, we expect that the third quarter will show further improvement in our results. We anticipate that additional cost reductions implemented in the second quarter will continue to enhance our margins through the rest of this year, incremental to the one million dollars in cost savings we’ve achieved in our General and Administrative expenses to date. Our outlook remains positive as supported by discussions with our customers and we look forward to a strong close to this year and continuing into 2018,”

Vertikal Comment

This looks quite positive for Manitex even though the bottom line is still clearly negative. The changes to the business make very sound sense and address the overexpansion that occurred with the acquisitions of CVS Ferrari and AVS. It still have fantastic potential to grow by focusing on its Manitex truck mounted cranes, PM loader cranes, Oil & Steel aerial lifts and Valla industrial crane product lines. All this plus its specialist crane products in the USA.

The clearer focus will hopefully allow it to invest more in its Valla, PM and Oil & Steel businesses over the next year or two. If so we expect to see real benefits start to flow as the company moves into 2018.