Quarterly Report (10-q)

Date : 11/08/2019 @ 4:49PM
Source : Edgar (US Regulatory)
Stock : Manitowoc Company (MTW)
Quote : 15.56  -0.01 (-0.06%) @ 12:59AM
Manitowoc share price Chart
After Hours
Last Trade
Last $ 15.56 ◊ 0.00 (0.00%)

Quarterly Report (10-q)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2019

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from          to

Commission File Number: 1-11978

 

The Manitowoc Company, Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Wisconsin

 

39-0448110

(State or other jurisdiction

 

(I.R.S. Employer

of incorporation or organization)

 

Identification Number)

 

11270 West Park Place

Suite 1000

 

 

Milwaukee, Wisconsin

 

53224

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (414) 760-4600

 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common Stock, $.01 Par Value

 

MTW

 

New York Stock Exchange

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

  

Accelerated filer

 

Non-accelerated filer

 

 

  

Smaller reporting company

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

As of September 30, 2019, the registrant had 35,349,046 shares of common stock, $.01 par value per share, outstanding.

1


 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

THE MANITOWOC COMPANY, INC.

Condensed Consolidated Statements of Operations

For the three and nine months ended September 30, 2019 and 2018

(Unaudited)

($ in millions, except per-share and average shares data)

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net sales

 

$

448.0

 

 

$

450.1

 

 

$

1,370.7

 

 

$

1,331.5

 

Cost of sales

 

 

359.6

 

 

 

370.1

 

 

 

1,106.9

 

 

 

1,092.6

 

Gross profit

 

 

88.4

 

 

 

80.0

 

 

 

263.8

 

 

 

238.9

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineering, selling and administrative expenses

 

 

54.8

 

 

 

62.1

 

 

 

164.7

 

 

 

184.6

 

Asset impairment expense

 

 

 

 

 

 

 

 

 

 

 

0.4

 

Amortization of intangible assets

 

 

 

 

 

 

 

 

0.2

 

 

 

0.2

 

Restructuring expense

 

 

1.1

 

 

 

1.0

 

 

 

8.3

 

 

 

11.0

 

Total operating costs and expenses

 

 

55.9

 

 

 

63.1

 

 

 

173.2

 

 

 

196.2

 

Operating income

 

 

32.5

 

 

 

16.9

 

 

 

90.6

 

 

 

42.7

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

(7.2

)

 

 

(9.9

)

 

 

(25.6

)

 

 

(29.3

)

Amortization of deferred financing fees

 

 

(0.4

)

 

 

(0.5

)

 

 

(1.2

)

 

 

(1.4

)

Loss on debt extinguishment

 

 

 

 

 

 

 

 

(25.0

)

 

 

 

Other income (expense) - net

 

 

(3.7

)

 

 

(5.7

)

 

 

8.8

 

 

 

(8.6

)

Total other expense

 

 

(11.3

)

 

 

(16.1

)

 

 

(43.0

)

 

 

(39.3

)

Income from continuing operations before income taxes

 

 

21.2

 

 

 

0.8

 

 

 

47.6

 

 

 

3.4

 

Provision (benefit) for income taxes

 

 

3.1

 

 

 

(10.7

)

 

 

10.3

 

 

 

(8.0

)

Income from continuing operations

 

 

18.1

 

 

 

11.5

 

 

 

37.3

 

 

 

11.4

 

Discontinued operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from discontinued operations, net of income taxes of $0.0,

   $0.0, $0.0 and $0.0, respectively

 

 

 

 

 

 

 

 

 

 

 

(0.2

)

Net income

 

$

18.1

 

 

$

11.5

 

 

$

37.3

 

 

$

11.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per Share Data

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.51

 

 

$

0.32

 

 

$

1.05

 

 

$

0.33

 

Loss from discontinued operations, net of income taxes

 

 

 

 

 

 

 

 

 

 

 

(0.01

)

Basic income per common share

 

$

0.51

 

 

$

0.32

 

 

$

1.05

 

 

$

0.32

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.51

 

 

$

0.32

 

 

$

1.05

 

 

$

0.32

 

Loss from discontinued operations, net of income taxes

 

 

 

 

 

 

 

 

 

 

 

(0.01

)

Diluted income per common share

 

$

0.51

 

 

$

0.32

 

 

$

1.05

 

 

$

0.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding - basic

 

 

35,348,597

 

 

 

35,564,946

 

 

 

35,527,971

 

 

 

35,488,271

 

Weighted average shares outstanding - diluted

 

 

35,458,956

 

 

 

35,928,327

 

 

 

35,686,831

 

 

 

35,935,093

 

 

The accompanying notes are an integral part to these Condensed Consolidated Financial Statements.

 

2


 

THE MANITOWOC COMPANY, INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

For the three and nine months ended September 30, 2019 and 2018

(Unaudited)

($ in millions)

 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net income

 

$

18.1

 

 

$

11.5

 

 

$

37.3

 

 

$

11.2

 

Other comprehensive income (loss), net of income tax

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unrealized income (expense) on derivatives, net of income

   tax provision of $0.0, $0.0, $0.0 and $0.0, respectively

 

 

(1.3

)

 

 

1.3

 

 

 

(0.6

)

 

 

(2.0

)

Employee pension and postretirement benefits, net of

   income tax benefit of $0.0, $0.8, $0.0 and

   $0.8, respectively

 

 

0.4

 

 

 

4.2

 

 

 

1.4

 

 

 

5.6

 

Foreign currency translation adjustments

 

 

(13.9

)

 

 

(7.1

)

 

 

(15.2

)

 

 

(22.5

)

Total other comprehensive loss, net of income tax

 

 

(14.8

)

 

 

(1.6

)

 

 

(14.4

)

 

 

(18.9

)

Comprehensive income (loss)

 

$

3.3

 

 

$

9.9

 

 

$

22.9

 

 

$

(7.7

)

 

The accompanying notes are an integral part to these Condensed Consolidated Financial Statements.

3


 

THE MANITOWOC COMPANY, INC.

Condensed Consolidated Balance Sheets

As of September 30, 2019 and December 31, 2018

(Unaudited)

($ in millions, except share data)

 

 

 

September 30,

2019

 

 

December 31,

2018

 

Assets

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

67.5

 

 

$

140.3

 

Accounts receivable, less allowances of $9.8 and $10.3, respectively

 

 

225.3

 

 

 

171.8

 

Inventories — net

 

 

521.9

 

 

 

453.1

 

Notes receivable — net

 

 

16.6

 

 

 

19.4

 

Other current assets

 

 

32.7

 

 

 

58.3

 

Total current assets

 

 

864.0

 

 

 

842.9

 

 

 

 

 

 

 

 

 

 

Property, plant and equipment — net

 

 

278.9

 

 

 

288.9

 

Operating lease right-of-use assets

 

 

42.5

 

 

 

 

Goodwill

 

 

231.5

 

 

 

232.8

 

Other intangible assets — net

 

 

114.6

 

 

 

118.1

 

Other long-term assets

 

 

59.2

 

 

 

59.2

 

Total assets

 

$

1,590.7

 

 

$

1,541.9

 

Liabilities and Stockholders' Equity

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

372.5

 

 

$

425.2

 

Short-term borrowings and current portion of long-term debt

 

 

4.3

 

 

 

6.4

 

Product warranties

 

 

41.4

 

 

 

39.1

 

Customer advances

 

 

9.7

 

 

 

9.6

 

Other liabilities

 

 

24.1

 

 

 

16.3

 

Total current liabilities

 

 

452.0

 

 

 

496.6

 

Non-Current Liabilities:

 

 

 

 

 

 

 

 

Long-term debt

 

 

309.1

 

 

 

266.7

 

Operating lease liabilities

 

 

32.5

 

 

 

 

Deferred income taxes

 

 

2.0

 

 

 

5.7

 

Pension obligations

 

 

80.3

 

 

 

85.7

 

Postretirement health and other benefit obligations

 

 

17.8

 

 

 

18.3

 

Long-term deferred revenue

 

 

29.9

 

 

 

25.2

 

Other non-current liabilities

 

 

42.0

 

 

 

42.4

 

Total non-current liabilities

 

 

513.6

 

 

 

444.0

 

Commitments and contingencies (Note 16)

 

 

 

 

 

 

 

 

Stockholders' Equity:

 

 

 

 

 

 

 

 

Preferred stock (authorized 3,500,000 shares of $.01 par value; none outstanding)

 

 

 

 

 

 

Common stock (75,000,000 shares authorized, 40,793,983 shares issued, 35,349,046

   and 35,588,833 shares outstanding, respectively)

 

 

0.4

 

 

 

0.4

 

Additional paid-in capital

 

 

591.0

 

 

 

584.8

 

Accumulated other comprehensive loss

 

 

(131.0

)

 

 

(116.6

)

Retained earnings

 

 

226.9

 

 

 

189.6

 

Treasury stock, at cost (5,444,937 and 5,205,150 shares, respectively)

 

 

(62.2

)

 

 

(56.9

)

Total stockholders' equity

 

 

625.1

 

 

 

601.3

 

Total liabilities and stockholders' equity

 

$

1,590.7

 

 

$

1,541.9

 

 

The accompanying notes are an integral part to these Condensed Consolidated Financial Statements.

 

4


 

THE MANITOWOC COMPANY, INC.

Condensed Consolidated Statements of Cash Flows

For the nine months ended September 30, 2019 and 2018

(Unaudited)

($ in millions)

 

 

 

Nine Months Ended

September 30,

 

 

 

2019

 

 

2018

 

Cash Flows from Operating Activities:

 

 

 

 

 

 

 

 

Net income

 

$

37.3

 

 

$

11.2

 

Adjustments to reconcile net income to cash used for operating activities:

 

 

 

 

 

 

 

 

Asset impairment expense

 

 

 

 

 

0.4

 

Depreciation

 

 

26.3

 

 

 

27.2

 

Amortization of intangible assets

 

 

0.2

 

 

 

0.2

 

Amortization of deferred financing fees

 

 

1.2

 

 

 

1.4

 

Loss on debt extinguishment

 

 

25.0

 

 

 

 

Gain on sale of property, plant and equipment

 

 

(3.5

)

 

 

(1.7

)

Other

 

 

8.7

 

 

 

7.6

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(184.2

)

 

 

(386.3

)

Inventories

 

 

(87.4

)

 

 

(106.3

)

Notes receivable

 

 

(0.5

)

 

 

18.0

 

Other assets

 

 

14.8

 

 

 

6.1

 

Accounts payable

 

 

(37.4

)

 

 

44.8

 

Accrued expenses and other liabilities

 

 

1.6

 

 

 

(43.1

)

Net cash used for operating activities

 

 

(197.9

)

 

 

(420.5

)

 

 

 

 

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(22.4

)

 

 

(21.4

)

Proceeds from sale of fixed assets

 

 

17.2

 

 

 

12.2

 

Cash receipts on sold accounts receivable

 

 

126.3

 

 

 

401.3

 

Net cash provided by investing activities

 

 

121.1

 

 

 

392.1

 

 

 

 

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

 

 

 

 

Proceeds from revolving credit facility

 

 

131.4

 

 

 

 

Payments on revolving credit facility

 

 

(131.4

)

 

 

 

Payments on long-term debt

 

 

(276.6

)

 

 

(4.6

)

Proceeds from long-term debt

 

 

300.0

 

 

 

 

Other debt - net

 

 

(2.8

)

 

 

 

Debt issuance costs

 

 

(8.3

)

 

 

 

Exercises of stock options

 

 

0.2

 

 

 

2.5

 

Common stock repurchases

 

 

(7.4

)

 

 

 

Net cash provided by (used for) financing activities

 

 

5.1

 

 

 

(2.1

)

 

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

 

(1.1

)

 

 

(1.9

)

 

 

 

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

 

(72.8

)

 

 

(32.4

)

Cash and cash equivalents at beginning of period

 

 

140.3

 

 

 

123.0

 

Cash and cash equivalents at end of period

 

$

67.5

 

 

$

90.6

 

 

The accompanying notes are an integral part to these Condensed Consolidated Financial Statements.

 

 

 

 

5


 

THE MANITOWOC COMPANY, INC.

Condensed Consolidated Statements of Equity

As of September 30, 2019 and December 31, 2018

(Unaudited)

($ in millions, except share data)

 

 

 

September 30,

2019

 

 

December 31,

2018

 

Common Stock - Shares Outstanding

 

 

 

 

 

 

 

 

Balance at beginning of period

 

 

35,588,833

 

 

 

35,273,864

 

Stock options exercised

 

 

36,479

 

 

 

95,019

 

Restricted stock, net

 

 

141,916

 

 

 

165,404

 

Performance shares issued

 

 

54,860

 

 

 

54,546

 

Common stock repurchases

 

 

(473,042

)

 

 

 

Balance at end of period

 

 

35,349,046

 

 

 

35,588,833

 

Common Stock - Par Value

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

0.4

 

 

$

0.4

 

Balance at end of period

 

$

0.4

 

 

$

0.4

 

Additional Paid-in Capital

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

584.8

 

 

$

577.6

 

Stock options exercised and issuance of other stock awards

 

 

(2.1

)

 

 

(1.0

)

Stock-based compensation

 

 

8.3

 

 

 

8.2

 

Balance at end of period

 

$

591.0

 

 

$

584.8

 

Accumulated Other Comprehensive Loss

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

(116.6

)

 

$

(97.4

)

Other comprehensive loss

 

 

(14.4

)

 

 

(19.2

)

Balance at end of period

 

$

(131.0

)

 

$

(116.6

)

Retained Earnings

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

189.6

 

 

$

256.7

 

Net income (loss)

 

 

37.3

 

 

 

(67.1

)

Balance at end of period

 

$

226.9

 

 

$

189.6

 

Treasury Stock

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

(56.9

)

 

$

(59.8

)

Stock options exercised and issuance of other stock awards

 

 

2.1

 

 

 

2.9

 

Common stock repurchases

 

 

(7.4

)

 

 

 

Balance at end of period

 

$

(62.2

)

 

$

(56.9

)

Total equity

 

$

625.1

 

 

$

601.3

 

 

The accompanying notes are an integral part to these Condensed Consolidated Financial Statements.

 

6


 

THE MANITOWOC COMPANY, INC.

Notes to Unaudited Condensed Consolidated Financial Statements

For the three and nine months ended September 30, 2019 and 2018

1.  Accounting Policies and Basis of Presentation

The Manitowoc Company, Inc. (“Manitowoc,” “MTW” or the “Company”) was founded in 1902 and has over a 116-year tradition of providing high-quality, customer-focused products and support services to its markets.  Manitowoc is one of the world's leading providers of engineered lifting solutions. Manitowoc, through its wholly-owned subsidiaries, designs, manufactures, markets, and supports comprehensive product lines of mobile telescopic cranes, tower cranes, lattice-boom crawler cranes, and boom trucks under the Grove, Manitowoc, National Crane, Potain, Shuttlelift and Manitowoc Crane Care brand names.

The Company has three reportable segments, the Americas segment, Europe and Africa (“EURAF”) segment and Middle East and Asia Pacific (“MEAP”) segment. The segments were identified using the “management approach,” which designates the internal organization that is used by management for making operating decisions and assessing performance. Refer to Note 14, “Segments” for additional information.

In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements contain all adjustments necessary for a fair statement of the results of operations and comprehensive income for the three and nine months ended September 30, 2019 and 2018, the cash flows for the same nine-month periods and the financial position and equity at September 30, 2019 and December 31, 2018, and except as otherwise discussed, such adjustments consist of only those of a normal recurring nature. The interim results are not necessarily indicative of results for a full year and do not contain information included in the Company’s annual consolidated financial statements and notes for the year ended December 31, 2018. Certain information and footnote disclosures, normally included in financial statements prepared in accordance with generally accepted accounting principles, have been condensed or omitted pursuant to Securities and Exchange Commission rules and regulations dealing with interim financial statements. However, the Company believes that the disclosures made in the Condensed Consolidated Financial Statements included herein are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the financial statements and the notes thereto included in the Company’s latest annual report on Form 10-K.

During the fourth quarter of 2018, the Company identified an adjustment to the Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2018. The adjustment related to the treatment of cash receipts on sold accounts receivable, whereby the Company had overstated cash flows provided by investing activities and overstated cash flows used for operating activities by approximately $20.6 million. This adjustment has been reflected in the prior period Condensed Consolidated Statement of Cash Flows in this filing. For the three and nine months ended September 30, 2019, the Company recorded a favorable pre-tax adjustment due to an over-accrual related to prior years of $2.0 million, $1.3 million after income tax, primarily impacting cost of sales in the Condensed Consolidated Statement of Operations. In evaluating whether the Company’s previously issued consolidated financial statements were materially misstated, the Company considered the guidance in Accounting Standards Codification (“ASC”) Topic 250, “Accounting Changes and Error Corrections” and ASC Topic 250-10-S99-1, “Assessing Materiality.” The Company determined that these adjustments were not material to the Company’s prior period consolidated financial statements and therefore, amending the previously filed report was not required.

Certain prior period amounts have been reclassified to conform to the current period presentation. All amounts, except per share and share amounts, are in millions of dollars throughout the tables in these notes unless otherwise indicated.

2. Revenues

 

The Company records deferred revenues when cash payments are received or due in advance of performance, including amounts which are refundable. The table below shows the change in the customer advances balance for the three and nine months ended September 30, 2019 and 2018.

 

7


 

 

 

Three Months Ended

September 30,

 

 

Nine Months Ended

September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Balance at beginning of period

 

$

10.6

 

 

$

15.3

 

 

$

9.6

 

 

$

12.7

 

Cash received or due in advance of satisfying

   performance obligation

 

 

25.4

 

 

 

14.9

 

 

 

75.6

 

 

 

71.7

 

Revenue recognized

 

 

(26.1

)

 

 

(18.1

)

 

 

(75.5

)

 

 

(71.7

)

Currency translation

 

 

(0.2

)

 

 

(0.3

)

 

 

 

 

 

(0.9

)

Balance at end of period

 

$

9.7

 

 

$

11.8

 

 

$

9.7

 

 

$

11.8

 

 

Disaggregation of the Company’s revenue sources are disclosed in Note 14, “Segments.”

3.  Inventories

The components of inventories as of September 30, 2019 and December 31, 2018 are summarized as follows:

 

 

 

September 30,

2019

 

 

December 31,

2018

 

Raw materials

 

$

176.2

 

 

$

159.2

 

Work-in-process

 

 

141.2

 

 

 

112.0

 

Finished goods

 

 

262.1

 

 

 

238.0

 

Total inventories

 

 

579.5

 

 

 

509.2

 

Excess and obsolete inventory reserve

 

 

(57.6

)

 

 

(56.1

)

Inventories — net

 

$

521.9

 

 

$

453.1

 

 

4.  Notes Receivable

The Company has notes receivable balances that are classified as current or long-term based on the timing of amounts due. Long-term notes receivable are included within other long-term assets on the Condensed Consolidated Balance Sheets. Current and long-term notes receivable balances primarily relate to the Company’s captive finance entity in China. The Company also has a long-term note receivable balance related to the 2014 sale of Manitowoc Dong Yue. During the third quarter of 2018, the Company wrote down the note with Manitowoc Dong Yue to the anticipated collection amount based on current expectations. The entire balance of the Manitowoc Dong Yue note is included in long-term notes receivable in the Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018. As of September 30, 2019, the Company had current and long-term notes receivable in the amount of $16.6 million and $20.6 million, respectively. As of December 31, 2018, the Company had current and long-term notes receivable in the amount of $19.4 million and $17.0 million, respectively.

 

5.  Property, Plant and Equipment

The components of property, plant and equipment at September 30, 2019 and December 31, 2018 are summarized as follows:

 

 

 

September 30,

2019

 

 

December 31,

2018

 

Land

 

$

23.5

 

 

$

24.1

 

Building and improvements

 

 

192.9

 

 

 

195.3

 

Machinery, equipment and tooling

 

 

267.0

 

 

 

269.4

 

Furniture and fixtures

 

 

16.5

 

 

 

16.4

 

Computer hardware and software

 

 

119.0

 

 

 

117.1

 

Rental cranes

 

 

77.4

 

 

 

84.0

 

Construction in progress

 

 

7.0

 

 

 

9.6

 

Total cost

 

 

703.3

 

 

 

715.9

 

Less accumulated depreciation

 

 

(424.4

)

 

 

(427.0

)

Property, plant and equipment — net

 

$

278.9

 

 

$

288.9

 

 

Property, plant and equipment are depreciated over the asset’s estimated useful lives using the straight-line depreciation method for financial reporting and accelerated methods for income tax purposes.

 

Assets Held for Sale

8


 

 

The Company had classified $12.9 million as assets held for sale within other current assets on the Condensed Consolidated Balance Sheets as of December 31, 2018 related to the Manitowoc, Wisconsin manufacturing buildings and land. In 2019, the Company sold the manufacturing buildings and land previously classified as assets held for sale, which resulted in a $3.5 million gain recorded within other income (expense) – net on the Condensed Consolidated Statements of Operations in the three and nine months ended September 30, 2019.

 

 

6.  Goodwill and Other Intangible Assets

The Company performs an annual impairment review of goodwill and indefinitely lived intangibles during the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired. There have been no impairment indicators since the fourth quarter of 2018; therefore, no impairment review has occurred during the nine months ended September 30, 2019.

The changes in the carrying amount of goodwill for the year ended December 31, 2018 and the nine months ended September 30, 2019 are summarized as follows:

 

 

 

Americas

 

 

EURAF

 

 

MEAP

 

 

Consolidated

 

Balance as of January 1, 2018

 

$

166.5

 

 

$

85.9

 

 

$

68.9

 

 

$

321.3

 

Foreign currency impact

 

 

 

 

 

(3.7

)

 

 

(2.6

)

 

 

(6.3

)

Goodwill impairment - October 31, 2018

 

 

 

 

 

(82.2

)

 

 

 

 

 

(82.2

)

Balance as of December 31, 2018

 

 

166.5

 

 

 

 

 

 

66.3

 

 

 

232.8

 

Foreign currency impact

 

 

 

 

 

 

 

 

(1.3

)

 

 

(1.3

)

Balance as of September 30, 2019

 

$

166.5

 

 

$

 

 

$

65.0

 

 

$

231.5

 

Other intangible assets with definite lives are amortized over their estimated useful lives.

The gross carrying amount, accumulated amortization and net book value of the Company’s intangible assets other than goodwill at September 30, 2019 and December 31, 2018 are summarized as follows:

 

 

 

September 30, 2019

 

 

December 31, 2018

 

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net

Book

Value

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net

Book

Value

 

Trademarks and tradenames

 

$

93.9

 

 

$

 

 

$

93.9

 

 

$

96.7

 

 

$

 

 

$

96.7

 

Customer relationships

 

 

10.1

 

 

 

(8.4

)

 

 

1.7

 

 

 

10.1

 

 

 

(8.4

)

 

 

1.7

 

Patents

 

 

29.0

 

 

 

(28.2

)

 

 

0.8

 

 

 

29.8

 

 

 

(29.0

)