Third-Quarter 2023 Highlights
- Net sales of $520.9 million, up 14.6% year-over-year
- Net income of $10.4 million, an increase of $8.1 million
year-over-year
- Adjusted EBITDA(1) of $33.3 million, margin percentage of
6.4%
- Non-new machine sales of $154.7 million, up 21.2%
year-over-year
The Manitowoc Company, Inc. (NYSE: MTW) (the “Company” or
“Manitowoc”) today reported third-quarter net income of $10.4
million, or $0.29 per diluted share. Third-quarter adjusted net
income(1) was $8.0 million, or $0.22 per diluted share.
Net sales increased 14.6% year-over-year to $520.9 million and
were favorably impacted by $14.5 million from changes in foreign
currency exchange rates. Non-new machine sales increased 21.2%
year-over-year to $154.7 million. Adjusted EBITDA(1) was $33.3
million, an increase of $9.3 million or 38.8% from the prior
year.
Orders were $531.2 million, a 12.5% increase from the prior
year. Orders were favorably impacted by $13.5 million from changes
in foreign currency exchange rates. Backlog increased $3.5 million
to $1,028.1 million as of September 30, 2023 from $1,024.6 million
as of June 30, 2023.
“Manitowoc’s third-quarter performance builds on the positive
momentum from the first half of 2023. Based on these results, we
are updating our full-year guidance,” commented Aaron H.
Ravenscroft, President and Chief Executive Office of The Manitowoc
Company, Inc.
“Manitowoc is dedicated to serving the needs of our customers by
investing in our CRANES+50 strategy as we grow our aftermarket
offerings. We are executing strategies to support modernizing
infrastructure, increasing clean energy, and building communities
around the world,” added Ravenscroft.
Updated Full-Year 2023 Guidance:
- Net sales - $2.175 billion to $2.225 billion
- Adjusted EBITDA - $160 million to $180 million
Share Repurchase Program
On October 31, 2023, the Board of Directors authorized a new
share repurchase program of up to $35 million of the Company’s
common stock with no stated expiration, which replaces the
authorization under the previous program. Under the program, shares
may be repurchased in the open market at times and amounts
determined by the Company based on its evaluation of market
conditions, continued compliance with its debt covenants, and other
factors. Manitowoc is not obligated to make any repurchases and may
discontinue the program at any time.
Investor Conference Call
The Manitowoc Company will host a conference call for security
analysts and institutional investors to discuss its third-quarter
2023 earnings results on Thursday, November 2, 2023, at 10:00 a.m.
ET (9:00 a.m. CT). A live audio webcast of the call, along with the
related presentation, will be available via webcast on the
Manitowoc website at http://ir.manitowoc.com in the "Events &
Presentations" section. A replay of the conference call will also
be available at the same location on the website.
About The Manitowoc Company, Inc.
The Manitowoc Company was founded in 1902 and has over a
120-year tradition of providing high-quality, customer-focused
products and support services to its markets. Headquartered in
Milwaukee, Wisconsin, United States, Manitowoc is one of the
world's leading providers of engineered lifting solutions.
Manitowoc, through its wholly-owned subsidiaries, designs,
manufactures, markets, distributes, and supports comprehensive
product lines of mobile hydraulic cranes, lattice-boom crawler
cranes, boom trucks, and tower cranes under the Aspen Equipment,
Grove, Manitowoc, MGX Equipment Services, National Crane, Potain,
and Shuttlelift brand names.
Footnote
(1) Adjusted net income, adjusted diluted net income per share
(“Adjusted DEPS”), EBITDA, adjusted EBITDA, and free cash flows are
financial measures that are not in accordance with U.S. GAAP. For
definitions and a reconciliation to the most comparable U.S. GAAP
numbers, please see the schedule of “Non-GAAP Financial Measures”
at the end of this press release.
Forward-looking Statements
This press release includes “forward-looking statements”
intended to qualify for the safe harbor from liability under the
Private Securities Litigation Reform Act of 1995. Any statements
contained in this press release that are not historical facts are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are
based on the current expectations of the management of the Company
and are subject to uncertainty and changes in circumstances.
Forward-looking statements include, without limitation, statements
typically containing words such as “intends,” “expects,”
“anticipates,” “targets,” “estimates,” and words of similar import.
By their nature, forward-looking statements are not guarantees of
future performance or results and involve risks and uncertainties
because they relate to events and depend on circumstances that will
occur in the future. There are a number of factors that could cause
actual results and developments to differ materially from those
expressed or implied by such forward-looking statements. Factors
that could cause actual results and developments to differ
materially include, among others:
- Macroeconomic conditions, including inflation, rising interest
rates, recessionary concerns and distress in global credit markets,
as well as ongoing global supply chain constraints, labor
availability and cost pressures such as changes in raw material and
commodity costs, and logistics constraints, have had, and may
continue to have, a negative impact on Manitowoc’s business,
financial condition, cash flows and results of operations
(including future uncertain impacts);
- actions of competitors;
- changes in economic or industry conditions generally or in the
markets served by Manitowoc;
- geopolitical events, including the ongoing conflict between
Russia and Ukraine and in the Middle East, other political and
economic conditions and risks and other geographic factors, has had
and may continue to lead to market disruptions, including
volatility in commodity prices (including oil and gas), energy
prices, inflation, consumer behavior, supply chain, and credit and
capital markets, and could result in the impairment of assets;
- changes in customer demand, including changes in global demand
for high-capacity lifting equipment, changes in demand for lifting
equipment in emerging economies and changes in demand for used
lifting equipment including changes in government approval and
funding of projects;
- failure to comply with regulatory requirements related to the
products the Company sells;
- the ability to capitalize on key strategic opportunities and
the ability to implement Manitowoc’s long-term initiatives;
- impairment of goodwill and/or intangible assets;
- changes in revenues, margins and costs;
- the ability to increase operational efficiencies across
Manitowoc and to capitalize on those efficiencies;
- the ability to generate cash and manage working capital
consistent with Manitowoc’s stated goals;
- work stoppages, labor negotiations, labor rates and labor
costs;
- risks and factors detailed in Manitowoc's 2022 Annual Report on
Form 10-K and its other filings with the United States Securities
and Exchange Commission.
Manitowoc undertakes no obligation to update or revise
forward-looking statements, whether as a result of new information,
future events, or otherwise. Forward-looking statements only speak
as of the date on which they are made. Information on the potential
factors that could affect the Company's actual results of
operations is included in its filings with the Securities and
Exchange Commission, including but not limited to its Annual Report
on Form 10-K for the fiscal year ended December 31, 2022.
THE MANITOWOC COMPANY,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In millions, except per share
and share amounts)
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Net sales
$
520.9
$
454.7
$
1,632.0
$
1,410.9
Cost of sales
424.1
380.4
1,305.9
1,162.9
Gross profit
96.8
74.3
326.1
248.0
Operating costs and expenses:
Engineering, selling and administrative
expenses
77.4
65.8
240.1
201.6
Amortization of intangible assets
0.7
0.8
2.4
2.4
Restructuring expense
0.7
0.1
1.0
0.5
Total operating costs and expenses
78.8
66.7
243.5
204.5
Operating income
18.0
7.6
82.6
43.5
Other expense:
Interest expense
(8.4
)
(8.0
)
(25.5
)
(23.3
)
Amortization of deferred financing
fees
(0.3
)
(0.3
)
(1.0
)
(1.0
)
Other income (expense) - net
1.1
2.7
(10.0
)
0.4
Total other expense
(7.6
)
(5.6
)
(36.5
)
(23.9
)
Income before income taxes
10.4
2.0
46.1
19.6
Benefit for income taxes
—
(0.3
)
(1.0
)
(0.9
)
Net income
$
10.4
$
2.3
$
47.1
$
20.5
Per Share Data and Share
Amounts:
Basic net income per common share
$
0.30
$
0.07
$
1.34
$
0.58
Diluted net income per common share
$
0.29
$
0.07
$
1.31
$
0.58
Weighted average shares outstanding -
basic
35,080,037
35,181,262
35,095,211
35,199,221
Weighted average shares outstanding -
diluted
35,787,704
35,374,194
35,836,672
35,470,301
THE MANITOWOC COMPANY,
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In millions, except par value
and share amounts)
September 30, 2023
December 31, 2022
Assets
Current Assets:
Cash and cash equivalents
$
40.0
$
64.4
Accounts receivable, less allowances of
$4.6 and $5.3, respectively
252.8
266.3
Inventories — net
719.9
611.9
Notes receivable — net
6.6
10.6
Other current assets
33.9
45.3
Total current assets
1,053.2
998.5
Property, plant and equipment — net
349.2
335.3
Operating lease right-of-use assets
46.1
45.2
Goodwill
78.4
80.1
Other intangible assets — net
123.5
126.7
Other non-current assets
41.8
29.7
Total assets
$
1,692.2
$
1,615.5
Liabilities and Stockholders'
Equity
Current Liabilities:
Accounts payable and accrued expenses
$
462.7
$
446.4
Customer advances
24.3
21.9
Short-term borrowings and current portion
of long-term debt
30.3
6.1
Product warranties
47.5
48.8
Other liabilities
23.7
24.6
Total current liabilities
588.5
547.8
Non-Current Liabilities:
Long-term debt
368.5
379.5
Operating lease liabilities
35.7
34.3
Deferred income taxes
4.9
4.9
Pension obligations
56.4
51.7
Postretirement health and other benefit
obligations
7.8
8.2
Long-term deferred revenue
17.7
15.6
Other non-current liabilities
39.7
35.7
Total non-current liabilities
530.7
529.9
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, 35,085,030 and 35,085,008
shares outstanding, respectively)
0.4
0.4
Additional paid-in capital
609.5
606.7
Accumulated other comprehensive loss
(120.9
)
(107.9
)
Retained earnings
151.4
104.3
Treasury stock, at cost (5,708,953 and
5,708,975 shares, respectively)
(67.4
)
(65.7
)
Total stockholders' equity
573.0
537.8
Total liabilities and stockholders'
equity
$
1,692.2
$
1,615.5
THE MANITOWOC COMPANY,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In millions)
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Cash Flows from Operating
Activities:
Net income
$
10.4
$
2.3
$
47.1
$
20.5
Adjustments to reconcile net income to
cash provided by (used for) operating activities:
Depreciation
13.7
14.5
41.8
46.2
Amortization of intangible assets
0.7
0.8
2.4
2.4
Stock-based compensation expense
2.4
1.5
7.8
5.6
Amortization of deferred financing
fees
0.3
0.3
1.0
1.0
Loss (gain) on sale of property, plant and
equipment
0.2
0.2
—
(0.9
)
Net unrealized foreign currency
transaction losses (gains)
3.0
0.6
(0.7
)
6.4
Income tax (benefit) expense from change
in reserve of uncertain tax positions
0.2
—
0.2
(11.7
)
Deferred income tax (benefit) expense
—
—
(14.0
)
0.9
Loss on foreign currency translation
adjustments
—
—
9.3
—
Other
—
—
—
0.9
Changes in operating assets and
liabilities
Accounts receivable
18.6
9.9
11.5
10.7
Inventories
(6.9
)
(26.9
)
(114.3
)
(136.1
)
Notes receivable
1.9
3.7
5.8
7.1
Other assets
(5.7
)
0.5
5.9
(0.6
)
Accounts payable
(34.4
)
(21.2
)
(14.9
)
39.8
Accrued expenses and other liabilities
21.9
7.6
34.3
7.3
Net cash provided by (used for) operating
activities
26.3
(6.2
)
23.2
(0.5
)
Cash Flows from Investing
Activities:
Capital expenditures
(23.6
)
(15.0
)
(59.9
)
(31.8
)
Proceeds from sale of property, plant and
equipment
0.2
0.1
5.3
1.5
Acquisition of businesses
—
—
—
2.3
Net cash used for investing activities
(23.4
)
(14.9
)
(54.6
)
(28.0
)
Cash Flows from Financing
Activities:
Proceeds from (payments on) revolving
credit facility - net
(12.0
)
24.0
—
4.0
Payments on revolving credit facility
—
—
(10.0
)
—
Other debt - net
23.8
(1.7
)
22.6
(4.0
)
Debt issuance and other debt related
costs
—
(0.1
)
—
(1.9
)
Exercise of stock options
—
—
0.3
0.1
Common stock repurchases
—
—
(5.5
)
(1.9
)
Net cash provided by (used for) financing
activities
11.8
22.2
7.4
(3.7
)
Effect of exchange rate changes on cash
and cash equivalents
(0.6
)
(1.0
)
(0.4
)
(0.6
)
Net increase (decrease) in cash and cash
equivalents
14.1
0.1
(24.4
)
(32.8
)
Cash and cash equivalents at beginning of
period
25.9
42.5
64.4
75.4
Cash and cash equivalents at end of
period
$
40.0
$
42.6
$
40.0
$
42.6
Non-GAAP Financial Measures
Adjusted net income, Adjusted DEPS, EBITDA, adjusted EBITDA, and
free cash flows are financial measures that are not in accordance
with U.S. GAAP. Manitowoc believes these non-GAAP financial
measures provide important supplemental information to both
management and investors regarding financial and business trends
used in assessing its results of operations. Manitowoc believes
excluding specified items provides a more meaningful comparison to
the corresponding reporting periods and internal budgets and
forecasts, assists investors in performing analysis that is
consistent with financial models developed by investors and
research analysts, provides management with a more relevant measure
of operating performance, and is more useful in assessing
management performance.
Adjusted Net Income and Adjusted DEPS
The Company defines adjusted net income as net income plus the
addback or subtraction of restructuring and other non-recurring
items. Adjusted DEPS is defined as adjusted net income divided by
diluted weighted average shares outstanding. Diluted weighted
average common shares outstanding are adjusted for the effect of
dilutive stock awards when there is net income on an adjusted
basis, as applicable. The reconciliation of net income and diluted
net income per share to adjusted net income and Adjusted DEPS for
the three and nine months ended September 30, 2023 and 2022 are
summarized as follows. All dollar amounts are in millions, except
per share data and share amounts.
Three Months Ended September
30,
2023
2022
As reported
Adjustments
Adjusted
As reported
Adjustments
Adjusted
Gross profit (1)
$
96.8
$
—
$
96.8
$
74.3
$
1.0
$
75.3
Engineering, selling and administrative
expenses (2)
(77.4
)
0.2
(77.2
)
(65.8
)
—
(65.8
)
Amortization of intangible assets
(0.7
)
—
(0.7
)
(0.8
)
—
(0.8
)
Restructuring expense (3)
(0.7
)
0.7
—
(0.1
)
0.1
—
Operating income
18.0
0.9
18.9
7.6
1.1
8.7
Interest expense
(8.4
)
—
(8.4
)
(8.0
)
—
(8.0
)
Amortization of deferred financing
fees
(0.3
)
—
(0.3
)
(0.3
)
—
(0.3
)
Other income - net
1.1
—
1.1
2.7
—
2.7
Income before income taxes
10.4
0.9
11.3
2.0
1.1
3.1
(Provision) benefit for income taxes
(4)
—
(3.3
)
(3.3
)
0.3
—
0.3
Net income
$
10.4
$
(2.4
)
$
8.0
$
2.3
$
1.1
$
3.4
Diluted weighted average common shares
outstanding
35,787,704
35,787,704
35,374,194
35,374,194
Diluted net income per share
$
0.29
$
0.22
$
0.07
$
0.10
(1)
The adjustment in 2022 represents $1.0
million of fair value step up on rental fleet assets sold during
the period that was expensed within cost of sales.
(2)
The adjustment in 2023 represents $0.2
million of one-time costs.
(3)
Represents adjustments for restructuring
expense.
(4)
The adjustment in 2023 represents the net
income tax impact of items (2) and (3) and the removal of a $3.2
million benefit from the favorable settlement of a tax matter.
Nine Months Ended September
30,
2023
2022
As reported
Adjustments
Adjusted
As reported
Adjustments
Adjusted
Gross profit (1)
$
326.1
$
—
$
326.1
$
248.0
$
3.3
$
251.3
Engineering, selling and administrative
expenses (2)
(240.1
)
11.0
(229.1
)
(201.6
)
(4.3
)
(205.9
)
Amortization of intangible assets
(2.4
)
—
(2.4
)
(2.4
)
—
(2.4
)
Restructuring expense (3)
(1.0
)
1.0
—
(0.5
)
0.5
—
Operating income
82.6
12.0
94.6
43.5
(0.5
)
43.0
Interest expense
(25.5
)
—
(25.5
)
(23.3
)
—
(23.3
)
Amortization of deferred financing
fees
(1.0
)
—
(1.0
)
(1.0
)
—
(1.0
)
Other income (expense) - net (4)
(10.0
)
9.3
(0.7
)
0.4
0.5
0.9
Income before income taxes
46.1
21.3
67.4
19.6
—
19.6
(Provision) benefit for income taxes
(5)
1.0
(17.3
)
(16.3
)
0.9
(8.7
)
(7.8
)
Net income
$
47.1
$
4.0
$
51.1
$
20.5
$
(8.7
)
$
11.8
Diluted weighted average common shares
outstanding
35,836,672
35,836,672
35,470,301
35,470,301
Diluted net income per share
$
1.31
$
1.43
$
0.58
$
0.33
(1)
The adjustment in 2022 represents $3.0
million of fair value step up on rental fleet assets sold during
the period that was expensed within cost of sales and $0.3 million
of other one-time costs associated with the acquired business.
(2)
The adjustment in 2023 represents $10.8
million of costs associated with a legal matter with the U.S. EPA
and $0.2 million of one-time costs. The adjustment in 2022
represents $4.8 million of income from the previously written off
long-term note receivable from the 2014 divestiture of the
Company's Chinese joint venture, partially offset by $0.3 million
of other one-time costs associated with the acquired business and
$0.2 million of other one-time charges.
(3)
Represents adjustments for restructuring
expense.
(4)
The adjustment in 2023 represents the
write-off of $9.3 million of non-cash foreign currency translation
adjustments from the curtailment of operations in Russia. The
adjustment in 2022 represents a $0.5 million write-off of other
debt related charges.
(5)
The adjustment in 2023 represents the net
income tax impact of items (2), (3), and (4), the removal of a
$13.9 million benefit from the release of a valuation allowance,
and the removal of a $3.2 million benefit from the favorable
settlement of a tax matter. The adjustment in 2022 represents the
net income tax impacts of items (1), (2), (3), and (4), the $10.9
million removal of an income tax benefit related to the release of
a U.S. Federal uncertain tax position, and establishment of a $1.0
million valuation allowance due to the Company's curtailment of
operations in Russia.
Free Cash Flows
The Company defines free cash flows as net cash provided by
(used for) operating activities less cash outflow from investment
in capital expenditures. The reconciliation of net cash provided by
(used for) operating activities to free cash flows for the three
and nine months ended September 30, 2023 and 2022 are summarized as
follows. All dollar amounts are in millions.
Three Months Ended September
30,
Nine Months Ended September
30,
2023
2022
2023
2022
Net cash provided by (used for) operating
activities
$
26.3
$
(6.2
)
$
23.2
$
(0.5
)
Capital expenditures
(23.6
)
(15.0
)
(59.9
)
(31.8
)
Free cash flows
$
2.7
$
(21.2
)
$
(36.7
)
$
(32.3
)
EBITDA and Adjusted EBITDA
The Company defines EBITDA as net income (loss) before interest,
taxes, depreciation, and amortization. The Company defines adjusted
EBITDA as EBITDA plus the addback or subtraction of restructuring,
other expense, and certain other non-recurring items - net. The
reconciliation of net income (loss) to EBITDA, and further to
adjusted EBITDA for the three and nine months ended September 30,
2023 and 2022 and trailing twelve months are summarized as follows.
All dollar amounts are in millions.
Three Months Ended September
30,
Nine Months Ended September
30,
Trailing Twelve
2023
2022
2023
2022
Months
Net income (loss)
$
10.4
$
2.3
$
47.1
$
20.5
$
(97.0
)
Interest expense and amortization of
deferred financing fees
8.7
8.3
26.5
24.3
35.2
Provision (benefit) for income taxes
—
(0.3
)
(1.0
)
(0.9
)
3.3
Depreciation expense
13.7
14.5
41.8
46.2
56.2
Amortization of intangible assets
0.7
0.8
2.4
2.4
3.1
EBITDA
33.5
25.6
116.8
92.5
0.8
Restructuring expense
0.7
0.1
1.0
0.5
2.0
Asset impairment expense (1)
—
—
—
—
171.9
Other non-recurring items - net (2)
0.2
1.0
11.0
(1.0
)
11.0
Other (income) expense - net (3)
(1.1
)
(2.7
)
10.0
(0.4
)
4.6
Adjusted EBITDA
$
33.3
$
24.0
$
138.8
$
91.6
$
190.3
Adjusted EBITDA margin percentage
6.4
%
5.3
%
8.5
%
6.5
%
8.4
%
(1)
The adjustment for the trailing twelve
months represents non-cash goodwill and indefinite-lived intangible
asset impairment charges.
(2)
Other non-recurring items - net for the
three months ended September 30, 2023 relate to $0.2 million of
one-time costs. Other non-recurring items - net for the nine months
ended and trailing twelve months ended September 30, 2023 relate to
$10.8 million of costs associated with a legal matter with the U.S.
EPA and $0.2 million of one-time costs. Other non-recurring items
for the three months ended September 30, 2022 relate to $1.0
million of fair value step up on rental fleet assets sold during
the period that was expensed within cost of sales. Other
non-recurring items - net for the nine months ended September 30,
2022 relate to $4.8 million of income from the partial recovery of
the previously written off long-term note receivable from the 2014
divestiture of the Company's Chinese joint venture, partially
offset by $3.0 million of fair value step up on rental fleet assets
sold during the period that was expensed within cost of sales, $0.6
million of other one-time costs associated with the acquired
business, and other one-time charges of $0.2 million.
(3)
Other (income) expense - net includes net
foreign currency gains (losses), other components of net periodic
pension costs, costs associated with legal matters, and other items
in the three, nine, and trailing twelve months ended September 30,
2023 and the three and nine months ended September 30, 2022. Other
expense – net for the nine and trailing twelve months ended
September 30, 2023 includes a $9.3 million write-off of non-cash
foreign currency translation adjustments from the curtailment of
operations in Russia.
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version on businesswire.com: https://www.businesswire.com/news/home/20231101529743/en/
Ion Warner SVP, Marketing and Investor Relations +1
414-760-4805
Manitowoc (NYSE:MTW)
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