Manitowoc Reports Record Financial Results For 2008
Inc. (NYSE: MTW) reported sales of
2008, a 16 percent increase from
Results for the quarter were a net loss of
per share, versus earnings of
quarter of the prior year. The earnings decline was due to the acquisition of
Enodis plc, partially offset by the gain on the divestiture of the Marine
segment, both of which were completed during the fourth quarter of 2008.
Excluding the impacts of the Enodis acquisition, the gain on sale of the
Marine segment, the early extinguishment of debt, and a restructuring charge
taken in the Crane segment, earnings from continuing operations for the
quarter were
per share, in the fourth quarter of 2007. A reconciliation of GAAP earnings to
earnings from continuing operations before special items for the three months
and 12 months ended
release.
For the full year 2008, sales were
from
Excluding the special items described in the reconciliation below, earnings
from continuing operations for 2008 were
versus
prior guidance is due to the after tax impact of the Crane restructuring
charge taken in
“This has been a transformational year for
president and chief executive officer. “We are successfully executing our
long-term strategy of building market-leadership positions in our two core
markets: cranes and commercial foodservice equipment. In addition, we have
divested our Marine segment and are now focusing all resources and management
efforts on expanding our competitive position within our two remaining
segments.
“Like most companies, we are feeling the impact of the global economic
slowdown. We have taken appropriate actions and we will make additional
changes to our businesses as market dynamics continue to unfold in 2009. We
intend to build on our leadership positions during this slowdown and emerge as
an even stronger competitor.”
Business Segment Results
Fourth-quarter 2008 net sales in the Crane segment were
essentially flat with net sales of
segment operating earnings for the fourth quarter of 2008 decreased to
million
backlog totaled
from the
“As we stated in our
weakening demand in the Crane segment, and we estimate a decline in crane
sales of approximately 20 percent in 2009,” said Tellock. “Although demand for
lighter lift capacity cranes has softened globally, demand for higher capacity
cranes in the U.S. and
experienced in the first half of 2008.”
In the Foodservice segment, fourth-quarter 2008 net sales increased 172
percent to
Operating earnings for the fourth quarter of 2008 were
the acquisition of Enodis, operating earnings were
quarter of 2008.
Organic revenue for the Foodservice segment declined 6.2 percent for the
latest quarter compared to the fourth quarter of 2007 and grew 1.0 percent for
the full year compared to 2007 results. The Foodservice segment is expected
to generate organic growth in the low single-digit range in 2009, despite the
global recession. Taking into account the acquisition of Enodis and related
asset sales expected later this year, we estimate that overall sales for the
Foodservice segment will be approximately
the results of the Enodis ice business.
Results from Discontinued Operations
The Marine segment and Enodis ice businesses generated sales of
year. Operating earnings were
The Marine segment was sold to Fincantieri Marine Group Holdings, Inc., a
subsidiary of Fincantieri – Cantieri Navali Italiani SpA (Fincantieri)
effective as of
million
share. Proceeds from the sale were used to partially pay down Term Loan X at
year-end. The Enodis ice businesses are classified as held-for-sale at
GAAP Reconciliation
In this release, the company refers to various non-GAAP measures. The
company believes that these measures are helpful to investors in assessing the
company’s ongoing performance of its underlying businesses before the impact
of special items. In addition, these non-GAAP measures provide a comparison to
commonly used financial metrics within the professional investing community
which do not include special items. Earnings and earnings per share before
special items reconcile to earnings presented according to GAAP as follows (in
millions, except per share data):
Three Months Ended Twelve Months Ended
December 31 December 31
2008 2007 2008 2007
Net earnings (loss) $(36.5) $99.2 $174.0 $336.7
Special items, net
of tax:
Loss (gain) on
currency hedge 117.7 - 246.6 (1.8)
Enodis results (net
of interest expense) 31.8 - 32.8 -
Crane segment
restructuring expense 13.6 - 14.1 -
Early extinguishment
of debt 2.7 - 2.7 8.1
Gain on sale of Marine
segment (62.8) - (62.8) -
Other - (3.1) - (1.9)
Net earnings before
special items $66.5 $96.1 $407.4 $341.1
Diluted earnings (loss)
per share $(0.28) $0.76 $1.32 $2.64
Special items, net
of tax:
Loss (gain) on
currency hedge 0.90 - 1.87 (0.01)
Enodis results (net of
interest expense) 0.24 - 0.25 -
Crane segment
restructuring expense 0.10 - 0.11 -
Early extinguishment
of debt 0.02 - 0.02 0.06
Gain on sale of Marine
segment (0.48) - (0.48) -
Other - (0.02) - (0.01)
Diluted earnings per
share before special
items $0.51 $0.74 $3.10 $2.68
2009 Guidance
“We are reiterating our previous earnings guidance for 2009 of
$1.60
on anticipated revenue of approximately
approximately
include the full-year impact of the Enodis acquisition, excluding the Enodis
ice operation. Operating margins for both segments are projected to be in the
low double-digit percentage range for the year.”
Other 2009 financial expectations include capital expenditures of
approximately
end of 2009; and an anticipated tax rate in the mid-20 percent range.
Investor Conference Call
On
will discuss its quarterly results during an investor conference call. All
interested parties may listen to the live conference call via the Internet by
going to the Investor Relations area of
http://www.manitowoc.com and completing a brief registration form. A replay of
the conference call will be available at the same location on the Web site.
About The Manitowoc Company, Inc.
The Manitowoc Company, Inc. is a multi-industry, capital goods
manufacturer with over 100 manufacturing and service facilities in 27
countries. It is recognized as one of the world’s largest providers of lifting
equipment for the global construction industry, including lattice-boom cranes,
tower cranes, mobile telescopic cranes, and boom trucks.
of the world’s leading innovators and manufacturers of commercial foodservice
equipment serving the ice, beverage, refrigeration, food prep, and cooking
needs of restaurants, convenience stores, hotels, healthcare, and
institutional applications.
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:
- unanticipated changes in revenues, margins, costs, and capital
expenditures;
- issues associated with new product introductions;
- matters impacting the successful and timely implementation of ERP
systems;
- foreign currency fluctuations and their impact on hedges in place
with Manitowoc;
- increases in raw material prices;
- unexpected issues associated with the availability of local
suppliers and skilled labor;
- unanticipated changes in consumer spending;
- unanticipated changes in global demand for high-capacity lifting
equipment;
- the risks associated with growth;
- geographic factors and political and economic risks;
- actions of competitors;
- changes in economic or industry conditions generally or in the
markets served by Manitowoc (including Enodis plc);
- the state of financial and credit markets;
- unanticipated changes in customer demand;
- unanticipated issues associated with refresh/renovation plans by
national restaurant accounts;
- efficiencies and capacity utilization of facilities;
- issues related to new facilities and expansion of existing
facilities;
- work stoppages, labor negotiations, and labor rates;
- government approval and funding of projects;
- the ability of our customers to receive financing;
- the ability to complete and appropriately integrate restructurings,
consolidations, acquisitions, divestitures, strategic alliances, and
joint ventures;
- in connection with the now-completed sale of Manitowoc Marine Group,
the tax gain, the earnings impact, and the costs incurred in
completing the sale;
- in connection with now-completed acquisition of Enodis plc,
potential balance sheet changes resulting from finalization of
purchase accounting treatment, compliance with the terms and
conditions of regulatory approvals relating to the required
divestiture of Enodis' global ice business and the timing, price,
and other terms of the required divestiture, the ability to complete
and appropriately and timely integrate the acquisition of Enodis
plc, anticipated earnings enhancements, estimated cost savings and
other synergies and the anticipated timing to realize those savings
and synergies, the costs incurred in completing the acquisition of
Enodis, the divestiture of the Enodis global ice business, and in
achieving synergies, potential divestitures and other strategic
options; and
- risks and other factors cited in the company's filings with the
United States Securities and Exchange Commission.
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
THE MANITOWOC COMPANY, INC.
Unaudited Consolidated Financial Information
For the Three and Twelve Months Ended December 31, 2008 and 2007
(In millions, except share and per-share data)
INCOME STATEMENT
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
Net sales $1,216.6 $1,045.9 $4,503.0 $3,684.0
Cost of sales 974.4 806.4 3,487.2 2,822.5
Gross profit 242.2 239.5 1,015.8 861.5
Engineering, selling
and administrative
expenses 137.7 101.9 455.1 377.9
Gain on sale of
parts line - - - (3.3)
Pension settlements - 0.1 - 5.3
Restructuring expense 20.9 - 21.7 -
Integration expense 6.0 - 7.6 -
Amortization expense 6.1 2.9 11.6 5.8
Operating earnings 71.5 134.6 519.8 475.8
Interest expense (32.6) (8.9) (54.1) (36.2)
Loss on debt
extinguishment (4.1) - (4.1) (12.5)
Loss on currency hedge (181.0) - (379.4) -
Other income - net (8.3) 5.4 (3.0) 9.8
Earnings (loss) from
continuing operations
before taxes on income
and minority interest (154.5) 131.1 79.2 436.9
Provision (benefit)
for taxes on income (54.4) 38.8 1.5 122.1
Earnings (loss) from
continuing
operations before
minority interest (100.1) 92.3 77.7 314.8
Minority interest,
net of income taxes (1.0) - (1.9) -
Earnings (loss) from
continuing operations $(99.1) $92.3 $79.6 $314.8
Discontinued operations:
Earnings (loss)
from discontinued
operations, net
of income taxes (0.2) 6.9 31.6 21.9
Gain on sale or
closure of
discontinued
operations, net
of income taxes 62.8 - 62.8 -
NET EARNINGS (LOSS) $(36.5) $99.2 $174.0 $336.7
BASIC EARNINGS
(LOSS) PER SHARE:
Earnings (loss) from
continuing operations $(0.76) $0.73 $0.61 $2.53
Earnings (loss) from
discontinued
operations, net of
income taxes - 0.05 0.24 0.18
Gain on sale or
closure of
discontinued
operations, net of
income taxes 0.48 - 0.48 -
BASIC EARNINGS
(LOSS) PER SHARE $(0.28) $0.78 $1.34 $2.70
DILUTED EARNINGS
(LOSS) PER SHARE:
Earnings (loss) from
continuing operations $(0.76) $0.71 $0.60 $2.47
Earnings (loss) from
discontinued
operations, net of
income taxes - 0.05 0.24 0.17
Gain on sale or
closure of
discontinued
operations, net of
income taxes 0.48 - 0.48 -
DILUTED EARNINGS
(LOSS) PER SHARE $(0.28) $0.76 $1.32 $2.64
AVERAGE SHARES
OUTSTANDING:
Average Shares
Outstanding -
Basic 130,153,938 127,179,136 129,930,749 124,667,931
Average Shares
Outstanding -
Diluted 130,153,938 129,949,006 131,630,215 127,489,416
SEGMENT SUMMARY
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
Net sales from continuing
operations:
Cranes and related products $943.6 $945.5 $3,882.9 $3,245.7
Foodservice equipment 273.0 100.4 620.1 438.3
Total $1,216.6 $1,045.9 $4,503.0 $3,684.0
Operating earnings (loss) from
continuing operations before
taxes and minority interest:
Cranes and related products $114.9 $141.7 $555.6 $470.5
Foodservice equipment 3.2 10.2 56.8 61.4
General corporate expense (13.6) (14.3) (51.7) (48.3)
Gain on sale of parts line - - - 3.3
Pension settlements - (0.1) - (5.3)
Restructuring expense (20.9) - (21.7) -
Integration expense (6.0) - (7.6) -
Amortization (6.1) (2.9) (11.6) (5.8)
Total $71.5 $134.6 $519.8 $475.8
THE MANITOWOC COMPANY, INC.
Unaudited Consolidated Financial Information
For the Three and Twelve Months Ended December 31, 2008 and 2007
(In millions)
BALANCE SHEET
December 31, December 31,
ASSETS 2008 2007
Current assets:
Cash and temporary investments $175.6 $369.4
Accounts receivable - net 608.2 416.7
Inventories - net 925.3 591.0
Other current assets 286.0 143.9
Current assets of discontinued operation 183.9 54.6
Total current assets 2,179.0 1,575.6
Property, plant and equipment - net 728.8 468.9
Intangible assets - net 2,808.0 672.2
Other long-term assets 179.7 83.4
Long-term assets of discontinued operation 233.3 71.3
TOTAL ASSETS $6,128.8 $2,871.4
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $1,206.3 $845.7
Short-term borrowings 67.7 13.1
Product warranties 102.0 80.4
Customer advances 48.5 -
Product liabilities 34.4 34.7
Current liabilities of discontinued operation 67.1 100.7
Total current liabilities 1,526.0 1,074.6
Long-term debt 2,587.7 217.5
Other non-current liabilities 582.9 229.4
Stockholders' equity 1,432.2 1,349.9
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $6,128.8 $2,871.4
CASH FLOW SUMMARY
Three Months Ended Twelve Months Ended
December 31, December 31,
2008 2007 2008 2007
Net earnings (loss) $(36.5) $99.2 $174.0 $336.7
Non-cash adjustments 171.9 21.8 413.6 78.5
Changes in operating assets and
liabilities 54.1 65.6 (285.1) (199.6)
Net cash provided by operating
activities of continuing
operations 189.5 186.6 302.5 215.6
Net cash provided by (used for)
operating activities of
discontinued operations (16.4) 17.4 20.5 28.4
Net cash provided by operating
activities 173.1 204.0 323.0 244.0
Business acquisitions, net of cash
acquired (2,386.1) 0.1 (2,412.8) (79.9)
Capital expenditures (43.3) (60.4) (139.5) (112.9)
Change in restricted cash 0.2 (1.1) 11.6 (1.6)
Proceeds from sale of fixed assets 4.4 1.9 10.0 9.8
Proceeds from the sale of parts
line - - - 4.9
Proceeds from the sale of business 118.5 - 118.5 -
Net cash used for investing
activities of discontinued
operations (2.7) (2.2) (4.9) (6.8)
Proceeds (payments) on borrowings
- net 2,051.4 (44.3) 2,041.4 (47.0)
Proceeds (payments) from
receivable financing - net 0.6 (0.8) (3.8) (4.3)
Dividends paid (2.6) (2.6) (10.4) (9.5)
Stock options exercised - 7.5 8.6 27.5
Net proceeds from issuance of
common stock - 157.1 - 157.1
Debt issuance costs (100.5) - (118.0) -
Net cash used for financing
activities of discontinued
operations 2.5 - 2.5 -
Effect of exchange rate changes on
cash (17.7) 2.7 (15.6) 10.7
Net increase (decrease) in cash &
temporary investments $(202.2) $261.9 $(189.4) $192.0
SOURCE The Manitowoc Company, Inc.