WESTPORT, Conn., Oct. 27, 2020 /PRNewswire/ -- Terex
Corporation (NYSE: TEX) today announced a third quarter 2020 income
from continuing operations of $22.0
million, or $0.31 per share,
on net sales of $765.6 million. In
the third quarter of 2019, the reported income from continuing
operations was $52.4 million, or
$0.73 per share, on net sales of
$1.0 billion. This compares to
income from continuing operations, as adjusted, of $58.9 million or $0.82 per share in the third quarter of 2019. The
Glossary at the end of this press release contains further details
regarding these non-GAAP measures.
John L. Garrison, Jr., Terex
Corporation Chairman and CEO, commented, "Our ability to execute
and safely serve customers during this uncertain time drove
sequentially stronger financial performance. Our results
demonstrate the progress we are making to align our cost structure
with the current customer demand environment. We are strategically
reducing spending and consolidating our company-wide footprint.
These actions will enable us to maintain a competitive cost
structure and position us for growth."
"Aerial Work Platforms (AWP) improved its operating performance
delivering 3.0% operating margin reflecting the gradual sequential
improvement in business activity. In addition, both Genie and Terex
Utilities are seeing improved utilization levels of their
equipment," said Mr. Garrison.
Mr. Garrison continued, "Materials Processing (MP) continued its
strong performance by delivering a 12.9% operating margin. MP is a
diversified and consistently strong performer, even in these
challenging times, with team members intently focused on profitable
growth and serving its customers globally."
"Terex's third quarter results demonstrate our ability to offset
challenging macroeconomic conditions by focusing on levers within
our control," said John D. Sheehan,
Terex Corporation Senior Vice President and Chief Financial
Officer. "We mitigated these headwinds with disciplined cost and
working capital management to generate $54
million of positive free cash flow in the quarter. Our free
cash flow performance reflects steady improvement in our businesses
and strong execution," continued Mr. Sheehan.
Based on the Company's current expectations of the markets,
overall revenue expectation for 2020 remains unchanged from our
outlook communicated in July. Also, consistent with historical cash
flow patterns, the fourth quarter of 2020 is expected to be the
Company's strongest free cash flow quarter of the year, with net
working capital continuing to be a source of cash.
"Finally, I am very proud with how our global team is managing
through this challenging year. We are on the path to enter
2021 as an even stronger company," Mr. Garrison
concluded.
Non-GAAP Measures and Other Items
Results of operations reflect continuing operations. All
per share amounts are on a fully diluted basis. A
comprehensive review of the quarterly financial performance is
contained in the presentation that will accompany the Company's
earnings conference call.
In this press release, Terex refers to various GAAP (U.S.
generally accepted accounting principles) and non-GAAP financial
measures. These non-GAAP measures may not be comparable to
similarly titled measures being disclosed by other companies.
Terex believes that this non-GAAP information is useful to
understanding its operating results and the ongoing performance of
its underlying businesses.
The Glossary at the end of this press release contains further
details about this subject.
Total amounts in tables of this release may not calculate due to
rounding.
Conference Call
The Company has scheduled a conference call to review the
financial results on Wednesday, October 28,
2020 at 8:30 a.m. ET.
John L. Garrison, Jr., Terex
Chairman and CEO, will host the call. A webcast of this call
can be accessed at https://investors.terex.com. Participants
are encouraged to access the call 15 minutes prior to the starting
time. The call will also be archived in the Event Archive at
https://investors.terex.com.
Forward-Looking Statements
This press release contains forward-looking information
regarding future events or the Company's future financial
performance based on the current expectations of Terex
Corporation. In addition, when included in this press
release, the words "may," "expects," "should," "intends,"
"anticipates," "believes," "plans," "projects," "estimates",
"will", and the negatives thereof and analogous or similar
expressions are intended to identify forward-looking
statements. However, the absence of these words does not mean
that the statement is not forward-looking. The Company has based
these forward-looking statements on current expectations and
projections about future events. These statements are not
guarantees of future performance.
Because forward-looking statements involve risks and
uncertainties, actual results could differ materially. Such risks
and uncertainties, many of which are beyond the control of Terex,
include among others: our business has been, and could be further,
adversely impacted by an outbreak of a new strain of coronavirus
("COVID-19"); our business is cyclical and weak general economic
conditions affect the sales of our products and financial results;
changes in import/export regulatory regimes and the escalation of
global trade conflicts could continue to negatively impact sales of
our products and our financial results; our financial results could
be adversely impacted by the United
Kingdom's departure from the European Union; changes
affecting the availability of the London Interbank Offered Rate may
have consequences on us that cannot yet reasonably be predicted;
our need to comply with restrictive covenants contained in our debt
agreements; our ability to generate sufficient cash flow to service
our debt obligations and operate our business; our ability to
access the capital markets to raise funds and provide liquidity;
our business is sensitive to government spending; our business is
highly competitive and is affected by our cost structure, pricing,
product initiatives and other actions taken by competitors; our
retention of key management personnel; the financial condition of
suppliers and customers, and their continued access to capital;
exposure from providing financing and credit support for some of
our customers; we may experience losses in excess of recorded
reserves; we are dependent upon third-party suppliers, making us
vulnerable to supply shortages and price increases; our business is
global and subject to changes in exchange rates between currencies,
commodity price changes, regional economic conditions and trade
restrictions; our operations are subject to a number of potential
risks that arise from operating a multinational business, including
compliance with changing regulatory environments, the Foreign
Corrupt Practices Act and other similar laws and political
instability; a material disruption to one of our significant
facilities; possible work stoppages and other labor matters;
compliance with changing laws and regulations, particularly
environmental and tax laws and regulations; litigation, product
liability claims, and other liabilities; our ability to comply with
an injunction and related obligations imposed by the United States
Securities and Exchange Commission ("SEC"); disruption or breach in
our information technology systems and storage of sensitive data;
our ability to successfully implement our strategy; and other
factors, risks and uncertainties that are more specifically set
forth in our public filings with the SEC.
Actual events or the actual future results of Terex may
differ materially from any forward-looking statement due to these
and other risks, uncertainties, and significant factors. The
forward-looking statements speak only as of the date of this
release. Terex expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statement included in this release to reflect any
changes in expectations with regard thereto or any changes in
events, conditions, or circumstances on which any such statement is
based.
About Terex
Terex is a global manufacturer of aerial work platforms and
materials processing machinery. The Company designs, builds and
supports products used in construction, maintenance, manufacturing,
energy, minerals and materials management applications. Terex's
products are manufactured in North and South America, Europe, Australia and Asia and sold worldwide. The Company engages
with customers through all stages of the product life cycle, from
initial specification and financing to parts and service support.
Terex uses its website (www.terex.com) to make information
available to its investors and the market.
Contact Information:
Randy
Wilson
Director, Investor Relations
(203) 221-5415
randy.wilson@terex.com
TEREX CORPORATION
AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(in millions, except
per share data)
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net sales
|
$
|
765.6
|
|
|
$
|
1,024.6
|
|
|
$
|
2,289.7
|
|
|
$
|
3,468.1
|
|
Cost of goods
sold
|
|
(619.3)
|
|
|
|
(815.0)
|
|
|
|
(1,899.6)
|
|
|
|
(2,748.9)
|
|
Gross
profit
|
|
146.3
|
|
|
|
209.6
|
|
|
|
390.1
|
|
|
|
719.2
|
|
Selling, general and
administrative expenses
|
|
(109.8)
|
|
|
|
(123.2)
|
|
|
|
(353.3)
|
|
|
|
(407.1)
|
|
Income (loss) from
operations
|
|
36.5
|
|
|
|
86.4
|
|
|
|
36.8
|
|
|
|
312.1
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
0.8
|
|
|
|
1.9
|
|
|
|
2.5
|
|
|
|
5.4
|
|
Interest
expense
|
|
(15.8)
|
|
|
|
(22.0)
|
|
|
|
(50.0)
|
|
|
|
(69.6)
|
|
Other income (expense)
– net
|
|
(0.6)
|
|
|
|
1.6
|
|
|
|
(0.1)
|
|
|
|
(2.9)
|
|
Income (loss) from
continuing operations before income taxes
|
|
20.9
|
|
|
|
67.9
|
|
|
|
(10.8)
|
|
|
|
245.0
|
|
(Provision for)
benefit from income taxes
|
|
1.1
|
|
|
|
(15.5)
|
|
|
|
4.9
|
|
|
|
(53.8)
|
|
Income (loss) from
continuing operations
|
|
22.0
|
|
|
|
52.4
|
|
|
|
(5.9)
|
|
|
|
191.2
|
|
Income (loss) from
discontinued operations – net of tax
|
|
(0.1)
|
|
|
|
(10.1)
|
|
|
|
(1.3)
|
|
|
|
(151.8)
|
|
Gain (loss) on
disposition of discontinued operations- net of tax
|
|
(16.1)
|
|
|
|
(20.9)
|
|
|
|
(21.1)
|
|
|
|
(9.5)
|
|
Net income
(loss)
|
$
|
5.8
|
|
|
$
|
21.4
|
|
|
$
|
(28.3)
|
|
|
$
|
29.9
|
|
Basic Earnings (loss)
per Share:
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
$
|
0.31
|
|
|
$
|
0.73
|
|
|
$
|
(0.09)
|
|
|
$
|
2.69
|
|
Income (loss) from
discontinued operations – net of tax
|
|
—
|
|
|
|
(0.14)
|
|
|
|
(0.02)
|
|
|
|
(2.14)
|
|
Gain (loss) on
disposition of discontinued operations – net of tax
|
|
(0.23)
|
|
|
|
(0.29)
|
|
|
|
(0.30)
|
|
|
|
(0.13)
|
|
Net income
(loss)
|
$
|
0.08
|
|
|
$
|
0.30
|
|
|
$
|
(0.41)
|
|
|
$
|
0.42
|
|
Diluted Earnings
(loss) per Share:
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations
|
$
|
0.31
|
|
|
$
|
0.73
|
|
|
$
|
(0.09)
|
|
|
$
|
2.66
|
|
Income (loss) from
discontinued operations – net of tax
|
|
—
|
|
|
|
(0.14)
|
|
|
|
(0.02)
|
|
|
|
(2.11)
|
|
Gain (loss) on
disposition of discontinued operations – net of tax
|
|
(0.23)
|
|
|
|
(0.29)
|
|
|
|
(0.30)
|
|
|
|
(0.13)
|
|
Net income
(loss)
|
$
|
0.08
|
|
|
$
|
0.30
|
|
|
$
|
(0.41)
|
|
|
$
|
0.42
|
|
Weighted average
number of shares outstanding in per share calculation
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
69.3
|
|
|
|
71.3
|
|
|
|
69.7
|
|
|
|
71.0
|
|
Diluted
|
|
69.5
|
|
|
|
71.8
|
|
|
|
69.7
|
|
|
|
71.8
|
|
TEREX CORPORATION
AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEET
(unaudited)
(in millions,
except par value)
|
|
|
September 30,
2020
|
|
December 31,
2019
|
|
|
Assets
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
508.3
|
|
$
|
535.1
|
Other current
assets
|
|
1,252.8
|
|
|
1,484.6
|
Total current
assets
|
|
1,761.1
|
|
|
2,019.7
|
Non-current
assets
|
|
|
|
|
|
Property, plant and
equipment – net
|
|
401.7
|
|
|
389.4
|
Other non-current
assets
|
|
752.4
|
|
|
786.5
|
Total non-current
assets
|
|
1,154.1
|
|
|
1,175.9
|
Total
assets
|
$
|
2,915.2
|
|
$
|
3,195.6
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Current portion of
long-term debt
|
$
|
7.5
|
|
$
|
6.9
|
Other current
liabilities
|
|
673.5
|
|
|
865.5
|
Total current
liabilities
|
|
681.0
|
|
|
872.4
|
Non-current
liabilities
|
|
|
|
|
|
Long-term debt, less
current portion
|
|
1,167.0
|
|
|
1,168.8
|
Other non-current
liabilities
|
|
214.5
|
|
|
222.1
|
Total non-current
liabilities
|
|
1,381.5
|
|
|
1,390.9
|
Total
liabilities
|
|
2,062.5
|
|
|
2,263.3
|
|
|
|
|
|
|
Total stockholders'
equity
|
|
852.7
|
|
|
932.3
|
Total liabilities and
stockholders' equity
|
$
|
2,915.2
|
|
$
|
3,195.6
|
|
|
|
|
|
|
TEREX CORPORATION
AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(in
millions)
|
|
|
Nine Months
Ended
September
30,
|
|
|
|
2020
|
|
2019
|
|
Operating
Activities
|
|
|
|
|
Net income
(loss)
|
$
|
(28.3)
|
|
$
|
29.9
|
|
Depreciation and
amortization
|
|
36.3
|
|
|
38.6
|
|
Changes in operating
assets and liabilities and non-cash charges
|
|
80.9
|
|
|
9.9
|
|
Net cash provided by
(used in) operating activities
|
|
88.9
|
|
|
78.4
|
|
Investing
Activities
|
|
|
|
|
|
|
Capital
expenditures
|
|
(53.9)
|
|
|
(75.4)
|
|
Other investing
activities, net
|
|
13.9
|
|
|
203.9
|
|
Net cash provided by
(used in) investing activities
|
|
(40.0)
|
|
|
128.5
|
|
Financing
Activities
|
|
|
|
|
|
|
Net cash provided by
(used in) financing activities
|
|
(80.8)
|
|
|
(85.5)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
4.4
|
|
|
(18.0)
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
(27.5)
|
|
|
103.4
|
|
Cash and cash
equivalents at beginning of period
|
|
540.1
|
|
|
372.1
|
|
Cash and cash
equivalents at end of period
|
$
|
512.6
|
|
$
|
475.5
|
|
|
|
|
|
|
|
|
TEREX CORPORATION
AND SUBSIDIARIES
SEGMENT RESULTS
DISCLOSURE
(unaudited)
(in
millions)
|
|
|
Q3
|
|
Year to
Date
|
|
2020
|
2019
|
|
2020
|
2019
|
|
|
|
%
of
|
|
|
%
of
|
|
|
|
%
of
|
|
|
%
of
|
Net
Sales
|
Net
Sales
|
|
Net
Sales
|
Net
Sales
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
765.6
|
|
$
|
1,024.6
|
|
|
$
|
2,289.7
|
|
|
$
|
3,468.1
|
|
|
Income (loss) from
operations
|
$
|
36.5
|
4.8%
|
$
|
86.4
|
8.4%
|
|
$
|
36.8
|
|
1.6%
|
$
|
312.1
|
|
9.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AWP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
445.0
|
|
$
|
628.2
|
|
|
$
|
1,370.6
|
|
|
$
|
2,226.5
|
|
|
Income (loss) from
operations
|
$
|
13.3
|
3.0%
|
$
|
45.9
|
7.3%
|
|
$
|
2.4
|
|
0.2%
|
$
|
191.8
|
|
8.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
311.3
|
|
$
|
382.7
|
|
|
$
|
890.5
|
|
|
$
|
1,224.1
|
|
|
Income (loss) from
operations
|
$
|
40.3
|
12.9%
|
$
|
58.4
|
15.3%
|
|
$
|
88.7
|
|
10.0%
|
$
|
183.2
|
|
15.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corp and Other /
Eliminations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
$
|
9.3
|
|
$
|
13.7
|
|
|
$
|
28.6
|
|
|
$
|
17.5
|
|
|
Loss from
operations
|
$
|
(17.1)
|
*
|
$
|
(17.9)
|
*
|
|
$
|
(54.3)
|
|
*
|
$
|
(62.9)
|
|
*
|
* - Not a meaningful
percentage
|
|
|
|
|
|
|
|
GLOSSARY
In an effort to provide investors with additional information
regarding the Company's results, Terex refers to various GAAP (U.S.
generally accepted accounting principles) and non-GAAP financial
measures which management believes provides useful information to
investors. These non-GAAP measures may not be comparable to
similarly titled measures being disclosed by other companies.
In addition, the Company believes that non-GAAP financial measures
should be considered in addition to, and not in lieu of, GAAP
financial measures. Terex believes that this non-GAAP
information is useful to understanding its operating results and
the ongoing performance of its underlying businesses.
Management of Terex uses both GAAP and non-GAAP financial measures
to establish internal budgets and targets and to evaluate the
Company's financial performance against such budgets and
targets.
The amounts described below are unaudited, are reported in
millions of U.S. dollars (except share data and percentages), and
are as of or for the period ended September 30, 2020, unless
otherwise indicated.
After-tax gains or losses and per share amounts are
calculated using pre-tax amounts, applying a tax rate based on
jurisdictional rates to arrive at an after-tax amount. This
number is divided by diluted weighted average shares outstanding to
provide the impact on earnings per share. The Company
highlights the impact of these items because when discussing
earnings per share, the Company adjusts for items it believes are
not reflective of ongoing operating activities in the
periods. Restructuring and related charges are a recurring
item as Terex's restructuring programs usually require more than
one year to fully implement and the Company is continually seeking
to take actions that could enhance its efficiency. Although
recurring, these charges are subject to significant fluctuations
from period to period due to varying levels of restructuring
activity and the inherent imprecision in the estimates used to
recognize the costs and taxes associated with severance and
termination benefits in the countries in which the restructuring
actions occur.
Q3
2019
|
|
Income (loss)
from
Continuing Operations
before Taxes
|
(Provision for)
benefit from
Income Taxes (1)
|
Income (loss)
from Continuing
Operations
|
Earnings (loss)
per share (2)
|
As Reported
(GAAP)
|
|
$
|
67.9
|
|
(15.5)
|
|
52.4
|
|
$
|
0.73
|
|
Restructuring &
Related
|
|
2.2
|
|
(0.5)
|
|
1.7
|
|
0.02
|
|
Transformation
|
|
2.2
|
|
(0.5)
|
|
1.7
|
|
0.02
|
|
Deal
Related
|
|
(0.7)
|
|
(0.1)
|
|
(0.8)
|
|
(0.01)
|
|
Other
|
|
(0.6)
|
|
—
|
|
(0.6)
|
|
—
|
|
Tax & Interim
Period (3)
|
|
—
|
|
4.5
|
|
4.5
|
|
0.06
|
|
As Adjusted
(Non-GAAP)
|
|
$
|
71.0
|
|
(12.1)
|
|
58.9
|
|
$
|
0.82
|
|
|
|
|
|
|
|
(1) Tax effect on
adjustments is calculated using the applicable jurisdictional
blended tax rate
|
(2) Based on diluted
average shares outstanding of 71.8 million
|
(3) Includes
adjustments without related pre-tax amounts and the tax amount
necessary to align quarterly tax expense (benefit) with the
forecasted full year as adjusted effective tax rate
|
YTD
2019
|
|
Income (loss)
from
Continuing Operations
before Taxes
|
(Provision for)
benefit from
Income Taxes (1)
|
Income (loss)
from Continuing
Operations
|
Earnings (loss)
per share (2)
|
As Reported
(GAAP)
|
|
$
|
245.0
|
|
(53.8)
|
|
191.2
|
|
$
|
2.66
|
|
Restructuring &
Related
|
|
12.6
|
|
(2.8)
|
|
9.8
|
|
0.14
|
|
Transformation
|
|
10.3
|
|
(1.9)
|
|
8.4
|
|
0.12
|
|
Deal
Related
|
|
(7.5)
|
|
0.2
|
|
(7.3)
|
|
(0.10)
|
|
Other
|
|
(0.6)
|
|
—
|
|
(0.6)
|
|
(0.01)
|
|
Tax & Interim
Period (3)
|
|
—
|
|
6.3
|
|
6.3
|
|
0.09
|
|
As Adjusted
(Non-GAAP)
|
|
$
|
259.8
|
|
(52.0)
|
|
207.8
|
|
$
|
2.90
|
|
|
|
|
|
|
|
(1) Tax effect on
adjustments is calculated using the applicable jurisdictional
blended tax rate
|
(2) Based on diluted
average shares outstanding of 71.8 million
|
(3) Includes
adjustments without related pre-tax amounts and the tax amount
necessary to align quarterly tax expense (benefit) with the
forecasted full year as adjusted effective tax rate
|
Free Cash Flow The Company calculates a non-GAAP
measure of free cash flow. The Company defines free cash flow
as Net cash provided by (used in) operating activities, plus
(minus) increases (decreases) in Terex Financial Services finance
receivables consisting of sales-type leases and commercial loans
("TFS Assets"), less Capital expenditures, net of proceeds from
sale of capital assets. The Company believes that this
measure of free cash flow provides management and investors further
useful information on cash generation or use in our primary
operations. The following table reconciles Net cash provided
by (used in) operating activities to free cash flow (in
millions):
|
|
Three Months
Ended
9/30/2020
|
|
Nine Months
Ended
9/30/2020
|
Net cash provided by
(used in) operating activities
|
|
$
|
76.6
|
|
|
$
|
88.9
|
|
Increase (decrease)
in TFS assets
|
|
(16.1)
|
|
|
(38.2)
|
|
Capital expenditures,
net of proceeds from sale of capital assets
(1)
|
|
(6.1)
|
|
|
(38.0)
|
|
Free cash
flow
|
|
$
|
54.4
|
|
|
$
|
12.7
|
|
|
(1) Includes $4.4 million and $13.4
million of proceeds from sale of capital assets within Proceeds
(payments) from the disposition of discontinued operations in the
Condensed Consolidated Statement of Cash Flows for the three and
nine months ended September 30, 2020, respectively.
|
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SOURCE Terex Corporation