-- Cash generated from operations was $169 million for the fourth
quarter and $384 million for the full year
-- Net debt decreased in the fourth quarter by $159 million and
$315 million for the full year
-- Net debt to book capitalization improved to 50.5%
WESTPORT, Conn.--(BUSINESS WIRE)--Feb. 18, 2004--Terex Corporation
(NYSE: TEX) today announced a net loss for the
full year 2003 of $25.5 million, or $0.53 per share, compared to a net
loss of $132.5 million, or $3.07 per share, for the full year 2002.
Excluding the impact of special items, net income for the full year
2003 was $71.3 million, or $1.44 per share, compared to $46.8 million,
or $1.06 per share, for the full year 2002. Net sales for 2003 were
$3,897.1 million, an increase of 39.3% from net sales of $2,797.4
million for 2002. Special items for the full year 2003 include net
charges of $96.8 million (approximately $24 million of which are cash)
and primarily includes goodwill impairment and restructuring
activities in the Roadbuilding businesses, product line
discontinuation and realignments, loss on the early extinguishment of
debt relating to the redemption of the Company's 8-7/8% Senior
Subordinated Notes, charges related to the Company's deferred
compensation plan and current period costs of previously announced
restructuring activities. Special items for the full year 2002
included net charges of $179.3 million (approximately $18 million of
which was cash) and primarily related to the impact of adopting SFAS
No. 141 "Business Combinations" and SFAS No. 142 "Goodwill and Other
Intangible Assets," a loss on the retirement of debt related to the
Company's bank refinancing, and restructuring initiatives at certain
business units.
The Company had a net loss in the fourth quarter of 2003 of $0.6
million, or $0.01 per share, compared to a net loss of $40.3 million,
or $0.85 per share, for the fourth quarter of 2002. Excluding the
impact of special items, net income for the fourth quarter of 2003 was
$14.3 million, or $0.29 per share, compared to $5.4 million, or $0.11
per share, for the fourth quarter of 2002. Net sales for the fourth
quarter of 2003 were $1,014.3 million, an increase of 19.2% from net
sales of $851.1 million for the fourth quarter of 2002. Special items
for the fourth quarter of 2003 include net charges of $14.9 million
(approximately $10 million of which are cash) and primarily relates to
a loss on the early extinguishment of debt relating to the redemption
of the Company's 8-7/8% Senior Subordinated Notes, charges related to
the Company's deferred compensation plan and costs associated with
restructuring activities in the Terex Cranes group. Special items for
the fourth quarter of 2002 included net charges of $45.7 million
(approximately $20 million of which was cash) and primarily related to
restructuring charges associated with facility and product line
rationalizations as a result of the 2002 acquisitions of Demag and
Genie, facility rationalizations within the compact equipment
businesses and the decision to exit certain other businesses.
"Overall, 2003 was a respectable year for Terex in light of market
conditions. We operated the Company throughout the year with an
unwavering focus on cash generation and reducing working capital
investment in our business," commented Ronald M. DeFeo, Terex's
Chairman and Chief Executive Officer. "In the fourth quarter, we
generated approximately $169 million in cash flow from operations and
reduced net debt by approximately $159 million. We exceeded our 2003
goals for cash from operations and debt reduction, generating
approximately $384 million from operations and reducing our net debt
by approximately $315 million, or 26%, to approximately $894 million
at year-end. Terex's balance sheet is in the best financial shape in
our Company's history."
Mr. DeFeo added, "Thanks to the strength of our diversified
business model, we leveraged the strong performance from our recent
large acquisitions to help offset currency moves, operational issues
and challenging end-markets in some of our other businesses. While we
still have room for improvement, we are pleased to know that our
efforts have yielded important advances in the key areas we targeted
at the beginning of 2003, namely debt reduction, cash flow and
internal improvement initiatives. We are excited about the direction
Terex is headed and remain committed to making sustainable
improvements that will deliver higher returns for our investors."
During the fourth quarter of 2003, the Company identified a need
to change its deferred compensation accounting treatment. The plan
permitted participants to transfer funds between investments in shares
of Terex common stock and another option. The ability to transfer
funds between investment options required the Company to mark to
market its obligation to plan participants invested in Terex common
stock. The plan has been revised effective January 1, 2004 to prohibit
transfers between investment options. As a result of this analysis,
the Company has determined that it will amend its unaudited financial
statements for the first three fiscal quarters of 2003. The amended
financial statements will reflect additional after tax charges
(credits) of: $0.5 million in the first quarter; $2.7 million for the
second quarter; and ($0.4) million for the third quarter of 2003. The
impact on previous years was not significant and was recorded in the
fourth quarter results. All figures presented in this release reflect
these accounting adjustments.
In this press release Terex refers to various non-GAAP (generally
accepted accounting principles) financial measures. These measures may
not be comparable to similarly titled measures being disclosed by
other companies. The table below and the tables included elsewhere in
this press release provide a reconciliation of the reported GAAP
numbers for the fourth quarter and full year 2003 and 2002, the
reported numbers excluding special items, and the reported numbers
excluding acquisitions (specifically Demag, Genie, Pacific Utility,
Telelect Southeast, Advance Mixer, Crane & Machinery, Commercial Body,
Combatel and Tatra) and special items. Terex believes that this
information is useful to understanding its operating results, the
ongoing performance of its underlying businesses without the impact of
special items, and the impact that acquisitions have had on its
financial performance. Terex also discloses EBITDA and net debt, as
they are commonly referred to financial metrics used in the investing
community. Terex believes that disclosure of EBITDA and net debt will
be helpful to those reviewing its performance and that of other
comparable companies, as EBITDA and net debt provide information on
Terex's leverage position, ability to meet debt service and capital
expenditure and working capital requirements, and EBITDA is also an
indicator of profitability.
A financial summary is shown below:
Three months ended December 31,
--------------------------------------------------------------------
2003
--------------------------------------------------------------------
(in millions, except per share amounts)
Excluding
Acquisitions
Special Excluding & Special
Reported Items Special Items (4)
(2) Items
-----------------------------------------
Net sales $1,014.3 $ --- $ 1,014.3 $ 573.5
======== ======= ========= ============
Gross profit $ 138.5 $ 8.9 $ 147.4 $ 83.5
SG&A 114.4 (9.8) 104.6 68.5
-------- ------- --------- ------------
Income from operations 24.1 18.7 42.8 $ 15.0
============
Other income (expense) (31.9) 9.0 (22.9)
Provision for income taxes 7.2 (12.8) (5.6)
Cumulative effect of
change in accounting
principles --- --- ---
-------- ------- ---------
Net income (loss) $ (0.6)$ 14.9 $ 14.3
======== ======= =========
Earnings per share $ (0.01) $ 0.29
EBITDA (1) $ 42.9 $ 61.6
Backlog $ 462.6 $ 18.7 $ 462.6
Average diluted shares
Outstanding 48.1 1.8 49.9
Three months ended December 31,
----------------------------------------------------------------------
2002
----------------------------------------------------------------------
(in millions, except per share amounts)
Excluding
Acquisitions
Special Excluding & Special
Reported Items Special Items (4)
(3) Items
-----------------------------------------
Net sales $ 851.1 $ (4.0) $ 847.1 $ 550.0
======== ======= ========= ============
Gross profit $ 64.8 $ 50.8 $ 115.6 $ 73.9
SG&A 100.3 (14.5) 85.8 58.9
-------- ------- --------- ------------
Income from operations (35.5) 65.3 29.8 $ 15.0
============
Other income (expense) (23.8) 1.9 (21.9)
Provision for income taxes 19.0 (21.5) (2.5)
Cumulative effect of
change in accounting
principles --- --- ---
-------- ------- ---------
Net income (loss) $ (40.3)$ 45.7 $ 5.4
======== ======= =========
Earnings per share $ (0.85) $ 0.11
EBITDA (1) $ (21.2) $ 44.1
Backlog $ 399.9 $ 65.3 $ 399.9
Average diluted shares
Outstanding 47.4 1.3 48.7
(1) EBITDA is calculated as income from operations plus
depreciation and amortization included in income from operations.
(2) Special items, net of tax, relate to previously announced
restructuring programs ($6.8 million), debt restructuring costs ($6.5
million), charges related to the deferred compensation plan ($3.8
million), restructuring charges at Pacific Utility and PPM Montceau
($0.3 million and $1.7 million, respectively), and other non-recurring
charges ($1.1 million).
(3) Special items, net of tax, relate to previously announced
restructuring initiatives ($37.3 million), Genie and Demag inventory
fair value accounting treatment ($2.7 million), SDC International
valuation adjustment due to decrease in stock price ($2.3 million),
one-time financial advisory fee ($2.4 million) and businesses to be
exited or phased down ($2.0 million), offset partially by a favorable
ruling on a legal claim ($1.0 million).
(4) Acquisitions excluded are Demag, Genie, Pacific Utility,
Telelect Southeast, Advance Mixer, Crane & Machinery, Commercial Body,
Combatel and Tatra.
Twelve months ended December 31,
----------------------------------------------------------------------
2003
----------------------------------------------------------------------
(in millions, except per share amounts)
Excluding
Acquisitions
Special Excluding & Special
Reported Items Special Items (4)
(2) Items
-----------------------------------------
Net sales $3,897.1 $ --- $ 3,897.1 $ 2,394.9
======== ======= ========= ============
Gross profit $ 518.5 $ 53.9 $ 572.4 $ 342.9
SG&A 393.7 (17.7) 376.0 251.7
Goodwill Impairment 51.3 (51.3) --- ---
-------- ------- --------- ------------
Income from operations 73.5 122.9 196.4 $ 91.2
============
Other income (expense) (108.8) 11.2 (97.6)
Provision for income taxes 9.8 (37.3) (27.5)
Cumulative effect of
change in accounting
principles --- --- ---
-------- ------- ---------
Net income (loss) $ (25.5)$ 96.8 $ 71.3
======== ======= =========
Earnings per share $ (0.53) $ 1.44
EBITDA (1) $ 138.4 $ 261.2
Backlog $ 462.6 $ 122.8 $ 462.6
Average diluted shares
Outstanding
47.7 1.8 49.5
Twelve months ended December 31,
----------------------------------------------------------------------
2002
----------------------------------------------------------------------
(in millions, except per share amounts)
Excluding
Acquisitions
Special Excluding & Special
Reported Items Special Items (4)
(3) Items
-----------------------------------------
Net sales $2,797.4 $ (12.7) $ 2,784.7 $ 2,323.2
======== ======= ========= ============
Gross profit $ 356.7 $ 71.7 $ 428.4 $ 363.9
SG&A 288.1 (16.3) 271.8 232.5
Goodwill Impairment --- --- --- ---
-------- ------- --------- ------------
Income from operations 68.6 88.0 156.6 $ 131.4
============
Other income (expense) (96.8) 8.8 (88.0)
Provision for income taxes 9.1 (30.9) (21.8)
Cumulative effect of
change in accounting
principles (113.4) 113.4 ---
-------- ------- ---------
Net income (loss) $ (132.5)$ 179.3 $ 46.8
======== ======= =========
Earnings per
share $ (3.07) $ 1.06
EBITDA (1) $ 108.8 $ 196.8
Backlog $ 399.9 $ 88.0 $ 399.9
Average diluted shares
Outstanding 43.2 0.9 44.1
(1) EBITDA is calculated as income from operations plus
depreciation and amortization included in income from operations.
(2) Special items, net of tax, relate to goodwill impairment for
the Roadbuilding group ($42.5 million), exiting certain businesses and
product rationalization within the Roadbuilding group ($22.0 million),
restructuring activities ($15.8 million), loss on retirement of debt
($7.9 million), charges related to the Company's deferred compensation
plan ($6.6 million), Genie and Demag inventory fair value accounting
treatment ($2.1 million), restructuring charges at Pacific Utility and
PPM Montceau ($0.3 million and $1.7 million, respectively), write-down
of certain assets within the EarthKing business ($1.7 million),
businesses held for sale or to be closed ($1.3 million), and write-off
of remaining investment in SDC International ($0.8 million), offset
partially by a favorable ruling on a legal claim ($1.7 million), and a
reduction of inventory reserves at CMI Terex ($1.0).
(3) Special items, net of tax, include the items described in (3)
above, as well as the charges associated with the adoption of SFAS No.
142 "Goodwill and Other Intangible Assets" ($124.1 million), income
associated with the adoption of SFAS No. 141 "Business Combinations"
($10.7 million), restructuring initiatives implemented in prior
quarters ($6.6 million), extraordinary loss on the early retirement of
debt ($1.6 million), equity loss on minority interest in Tatra ($1.2
million), Genie and Demag inventory fair value accounting treatment
($2.5 million), businesses held for sale or phase down ($0.9 million),
and the write down of certain assets within the Light Construction
Group, European Crane Group, and EarthKing subsidiary ($15.6 million),
offset partially by a foreign exchange rate gain related to the Demag
acquisition ($2.8 million) and a favorable ruling on a legal claim
($5.4 million).
(4) Acquisitions excluded are Demag, Genie, Pacific Utility,
Telelect Southeast, Advance Mixer, Crane & Machinery, Commercial Body,
Combatel and Tatra.
Segment Performance
The comparative segment performance below excludes special items.
See Table I included later in this press release for the
reconciliation to the reported GAAP numbers.
Terex Construction
Three months ended December Twelve months ended December
31, 31,
--------------------------- -------------------------------
(dollars in millions)
2003 2002 2003 2002
------------- ------------- --------------- ---------------
% of % of % of % of
sales sales sales sales
----- ----- ----- -----
Net sales $351.4 $272.5 $1,359.5 $1,162.9
======= ======= ========= =========
Gross
profit $ 42.2 12.0% $ 41.8 15.3% $ 179.0 13.2% $ 177.3 15.2%
SG&A 30.3 8.6% 26.5 9.7% 116.6 8.6% 102.0 8.8%
------- ------- --------- ---------
Operating
profit $ 11.9 3.4% $ 15.3 5.6% $ 62.4 4.6% $ 75.3 6.5%
======= ======= ========= =========
Backlog $109.0 $ 75.9 $ 109.0 $ 75.9
Net sales in the Terex Construction group for the fourth quarter
of 2003 increased $78.9 million to $351.4 million, from $272.5 million
in the fourth quarter of 2002, driven primarily by the impact of a
weaker dollar and strong year-over-year performance from the
Powerscreen business. Operating profit for the fourth quarter of 2003
was $11.9 million, or 3.4% of sales, compared to $15.3 million, or
5.6% of sales, for the fourth quarter of 2002. Both gross profit and
operating margin levels, when compared to the prior year, were
negatively impacted by currency fluctuations, which affected equipment
manufactured in Europe and imported into North America. Additionally,
there were increased expenses in 2003 related to a model changeover in
the articulated truck business.
Net sales in the Terex Construction group for 2003 increased
$196.6 million to $1,359.5 million, from $1,162.9 million in 2002. The
increase in net sales was driven by the performance of the Atlas,
Powerscreen, and Fuchs businesses, along with the translation benefit
of a weaker U.S. dollar relative to European currencies. Selling,
general and administrative expenses for the year were $116.6 million,
or 8.6% of sales, compared to $102.0 million, or 8.8% of sales, for
2002. Operating profit in 2003 decreased $12.9 million to $62.4
million, or 4.6% of sales, from $75.3 million, or 6.5% of sales, in
2002, reflecting the impact of foreign currency exchange rates, the
additional costs related to the articulated truck business product
changeover, and the further emphasis on cash generation with regard to
the disposition of used equipment.
"The Terex Construction group continued to face challenging
markets during 2003," commented Colin Robertson, President - Terex
Construction. "The performance of the Powerscreen businesses remained
strong, the Atlas business had a much better year in both sales and
operating profit when compared to 2002, and we completed the
consolidation of our compact construction manufacturing facilities.
Unfortunately, the effects of exchange rate fluctuations on our profit
margin and the costs involved with the model changeover in our
articulated truck product line negatively impacted our operating
results."
Mr. Robertson continued, "North America remains a huge opportunity
for Terex Construction. We are set to launch our large tracked
hydraulic excavator and large wheel loader in the North American
market, and we should begin to see the benefits of our relationship
with the Genie distribution team on our compact construction line. We
remain focused on revenue growth opportunities through market share
expansion and capitalizing on the beginnings of the economic recovery.
The opportunity to drive further reductions in our working capital
investment in these businesses still exists, as we balance our growth
and cash generation ambitions."
Terex Cranes
Three months ended December Twelve months ended December
31, 31,
--------------------------- -----------------------------
(dollars in millions)
2003 2002 2003 2002
------------- ------------- --------------- -------------
% of % of % of % of
sales sales sales sales
----- ----- ----- -----
Net sales $260.1 $267.4 $1,005.1 $700.8
======= ======= ========= =======
Gross profit$ 33.3 12.8% $ 27.8 10.4% $ 118.4 11.8% $ 89.5 12.8%
SG&A 25.3 9.7% 20.5 7.7% 85.4 8.5% 50.5 7.2%
------- ------- --------- -------
Operating
profit $ 8.0 3.1% $ 7.3 2.7% $ 33.0 3.3% $ 39.0 5.6%
======= ======= ========= =======
Backlog $138.8 $146.2 $ 138.8 $146.2
Net sales in the Terex Cranes group for the fourth quarter of 2003
decreased $7.3 million to $260.1 million from $267.4 million in the
fourth quarter of 2002. The decrease in sales was primarily due to the
divestiture of the Schaeff Incorporated (U.S. forklift manufacturer)
and Crane & Machinery (crane distribution) businesses during the
fourth quarter of 2003. Selling, general and administrative expenses
increased to $25.3 million, or 9.7% of sales, from $20.5 million, or
7.7% of sales, in the fourth quarter of 2002, due largely to currency
translation effects, increased bad debt and other expenses in the PPM
business. Terex Cranes reported an operating profit of $8.0 million,
or 3.1% of sales, in the fourth quarter of 2003 compared to $7.3
million, or 2.7% of sales, in the fourth quarter of 2002. Operating
margin during the fourth quarter of 2003 was impacted by continued
weakness in the North American market and the impact of a weaker
dollar on the sales of European built cranes sold into the United
States. The relatively strong performance of the Demag and Italian
crane businesses more than offset these items for the period.
Net sales for 2003 increased $304.3 million to $1,005.1 million
from $700.8 million in 2002, reflecting the full year effect of Demag,
which was acquired in August 2002. A weak North American mobile
telescopic and truck crane market accounted for the revenue decline in
the base business. This continued weakness was partially offset by
growth in the tower crane and Italian mobile telescopic businesses.
Selling, general and administrative expenses in 2003 increased to
$85.4 million, or 8.5% of sales, from $50.5 million, or 7.2% of sales,
in 2002, mainly due to the full year effect of Demag and currency
translation. Operating margin decreased to 3.3% in 2003, from 5.6% in
2002, reflecting the impact of the under performing North American
markets and currency pressure, partially offset by the strong
performance of the international crane business.
"We had a challenging fourth quarter and finish to the year,"
commented Steve Filipov, President - Terex Cranes. "We successfully
completed the integration of Demag and our focus on working capital
improvements allowed us to generate significant cash for Terex."
Mr. Filipov continued, "I am pleased with the growing strength of
the Terex Crane franchise. Demag closed December with a record month -
the highest revenues ever achieved in its history. Our all-terrain
crane product line continued to gain market share in the largest
market, Western Europe. However, the crawler crane product line
continues to be challenging due to the difficult North American
market." Mr. Filipov continued, "We closed the Peiner production
facility in Trier, Germany in the fourth quarter and have started
production of Peiner Tower Cranes in our Demag facility in
Zweibrucken, Germany. We would expect to see the financial benefits of
this move in 2004."
Terex Roadbuilding, Utility Products and Other
Three months ended December Twelve months ended
31, December 31,
--------------------------- ---------------------------
(dollars in millions)
2003 2002 2003 2002
------------- ------------- ------------- -------------
% of % of % of % of
sales sales sales sales
----- ----- ----- -----
Net sales $220.3 $136.8 $711.9 $562.4
======= ======= ======= =======
Gross profit $ 29.7 13.5% $ 23.1 16.9% $ 98.7 13.9% $107.1 19.0%
SG&A 22.2 10.1% 16.5 12.1% 77.2 10.8% 71.7 12.7%
------- ------- ------- -------
Operating
profit $ 7.5 3.4% $ 6.6 4.8% $ 21.5 3.1% $ 35.4 6.3%
======= ======= ======= =======
Backlog $164.7 $120.0 $164.7 $120.0
Net sales for the Terex Roadbuilding, Utility Products and Other
group for the fourth quarter of 2003 increased $83.5 million to $220.3
million, from $136.8 million for the fourth quarter of 2002, driven
primarily by the acquisitions of Tatra, Commercial Body and Combatel.
Excluding the impact of acquisitions, sales increased approximately
6%. Although the Roadbuilding business continued to be negatively
impacted by current highway spending levels, the Material Processing
and Light Construction businesses both displayed strong growth over
the prior year. Selling, general and administrative expenses for the
fourth quarter of 2003 increased to $22.2 million, or 10.1% of sales,
compared to $16.5 million, or 12.1% of sales, for the fourth quarter
of 2002, reflecting the impact of acquisitions. Excluding the impact
of acquisitions, operating expenses remained flat at $16.5 million.
Operating profit for the fourth quarter of 2003 increased to $7.5
million, or 3.4% of sales, from $6.6 million, or 4.8% of sales, for
the fourth quarter of 2002. Excluding the impact of acquisitions,
operating profit for the fourth quarter of 2003 was $6.1 million, or
4.2% of sales, compared to $6.6 million, or 4.8% of sales, for the
fourth quarter of 2002, reflecting the strong performance of the Light
Construction and Material Processing businesses, offset by the
Roadbuilding downturn.
Net sales for the Terex Roadbuilding, Utility Products and Other
group for the full year 2003 increased $149.5 million to $711.9
million, from $562.4 million for 2002, reflecting the impact of
acquired companies. Excluding acquisitions, sales declined
approximately 4% during 2003, due largely to continued weakness in the
Roadbuilding businesses. Selling, general and administrative expenses
for 2003 increased to $77.2 million, or 10.8% of sales, from $71.7
million, or 12.7% of sales, for 2002. Excluding acquisitions, SG&A
expenses as a percentage of sales declined to 11.7% of sales,
reflecting the impact of Roadbuilding restructuring activities that
took place during 2003. Operating profit for the full year 2003
declined by $13.9 million to $21.5 million, or 3.1% of sales, from
$35.4 million, or 6.3% of sales, for 2002. Excluding the impact of
acquisitions, operating margin was 3.3% for 2003.
"We have taken actions in 2003 to right-size the business for the
current economic conditions," commented Mr. DeFeo. "The restructuring
initiatives launched during the past 18 months have allowed us to
maintain a level of profitability relative to 2002. However, revenue
levels in the Roadbuilding business continue to be negatively impacted
by budget issues at the federal, state, and local levels. Our Utility
business has successfully integrated our recent distribution network
acquisitions and has demonstrated the ability to compete for the large
investor owned utility business, an important market where Terex has
not traditionally been a strong participant. Tatra, Terex's most
recent addition, is progressing nicely and was profitable in the
fourth quarter, and we expect it, and the related American Truck
Company, to be contributors to our performance in the future."
Terex Aerial Work Platforms
Three months ended December Twelve months ended
31, December 31,
--------------------------- ---------------------------
(dollars in millions)
2003 2002 2003 2002
------------- ------------- ------------- -------------
% of % of % of % of
sales sales sales sales
----- ----- ----- -----
Net sales $132.5 $101.8 $583.6 $149.4
======= ======= ======= =======
Gross profit $ 31.3 23.6% $ 19.3 19.0% $128.0 21.9% $ 25.2 16.9%
SG&A 17.2 13.0% 13.8 13.6% 59.4 10.2% 17.0 11.4%
------- ------- ------- -------
Operating
profit $ 14.1 10.6% $ 5.5 5.4% $ 68.6 11.8% $ 8.2 5.5%
======= ======= ======= =======
Backlog $ 22.2 $ 10.0 $ 22.2 $ 10.0
The Terex Aerial Work Platforms group represents the results of
Genie Holdings, Inc. and its subsidiaries since their acquisition by
Terex on September 18, 2002. In addition, beginning April 1, 2003, the
Aerial Work Platform group became responsible for the manufacturing,
sales and service of the Terex telehandlers business in North America,
and prior year amounts have been restated for consistency.
Net sales for the Terex Aerial Work Platforms group for the fourth
quarter of 2003 increased $30.7 million to $132.5 million, from $101.8
million in the fourth quarter of 2002, driven primarily by rental
company customers updating and expanding their rental fleets in
response to early signs of an improving economy. Selling, general and
administrative expenses for the fourth quarter of 2003 were $17.2
million, or 13.0% of sales, compared to $13.8 million, or 13.6% of
sales, for the fourth quarter of 2002. Operating profit for the fourth
quarter of 2003 was $14.1 million, or 10.6% of sales, compared to $5.5
million, or 5.4% of sales, for the fourth quarter of 2002. The
increase in operating margins was driven primarily by higher unit
volume, favorable currency effect on exports to Europe, and continual
cost reduction initiatives.
"We are pleased with our fourth quarter performance," commented
Bob Wilkerson, President - Terex Aerial Work Platforms. "Our rental
customers are more optimistic based on improved utilization/rental
rates in their markets, and our volume increase over the prior year in
what is normally our seasonally depressed period appears to be
indicative of the projected capital spending of our rental customers
for 2004, which is expected to be a significant increase over 2003
levels."
Mr. Wilkerson added, "The past year was also a year of operational
focus, as our cost reduction and cash orientation continued to improve
through the year. We look forward to integrating the North American
sales for Terex's Compact Equipment line with our Genie sales team, so
that we can serve the rental channel with a broader product offering,
as well as sharing best practices in manufacturing and customer
service within the Terex family."
Terex Mining
Three months ended Twelve months ended
December 31, December 31,
-------------------------- ---------------------------
(dollars in millions)
2003 2002 2003 2002
------------ ------------- ------------- -------------
% of % of % of % of
sales sales sales sales
----- ------ ----- -----
Net sales $75.0 $74.7 $294.5 $282.8
====== ====== ======= =======
Gross profit $11.4 15.2% $ 3.8 5.1% $ 48.9 16.6% $ 29.7 10.5%
SG&A 9.0 12.0% 7.2 9.6% 34.3 11.6% 27.3 9.7%
------ ------ ------- -------
Operating profit$ 2.4 3.2% $(3.4) (4.6%) $ 14.6 5.0% $ 2.4 0.8%
====== ====== ======= =======
Backlog $33.6 $47.8 $ 33.6 $ 47.8
On July 1, 2003, Terex announced that it had reached an agreement
in principle to sell its worldwide electric drive mining truck
business. As a result, at that time the Company accounted for the
mining truck business and wholly owned product support businesses as a
discontinued operation and ceased reporting Terex Mining as a separate
financial reporting segment. On December, 10, 2003, Terex terminated
the negotiation for the sale of the electric drive mining truck
business, and has accordingly reinstated reporting of the Terex Mining
segment as a continuing operation.
Net sales for the Terex Mining group for the fourth quarter of
2003 were basically flat with 2002. Selling, general and
administrative expenses for the fourth quarter of 2003 were $9.0
million, or 12.0% of sales, compared to $7.2 million, or 9.6% of
sales, for the fourth quarter of 2002. Operating profit for the fourth
quarter of 2003 was $2.4 million, or 3.2% of sales, compared to a net
loss of $3.4 million for the fourth quarter of 2002. The significant
increase in operating margin was driven primarily by the effect of
cost savings initiatives in the North American operations and a
favorable comparison relative to warranty and product service costs
included in the fourth quarter 2002 results.
Net sales for 2003 increased $11.7 million to $294.5 million from
$282.8 million in 2002, largely due to strong performance in South
African distribution. Selling, general and administrative expenses in
2003 increased to $34.3 million, or 11.6% of sales, from $27.3
million, or 9.7% of sales, in 2002. Operating profit as a percentage
of sales increased to 5.0% in 2003, from 0.8% in 2002, reflecting the
benefit of prior restructuring activities and a favorable comparison
relative to 2002 warranty and service costs.
"Terex Mining posted solid year-over-year performance despite the
announced agreement in principle to sell Terex's world wide electric
drive truck business and the subsequent termination of that
agreement," commented Rick Nichols, President - Terex Mining. "During
this period, while sales were relatively flat, the profitability of
this business has significantly improved, which is a direct result of
prior year restructuring activities, continued focus on cost reduction
activities and strong performance of the mining shovel business. South
Africa, in particular, has been a strong market for Terex Mining, with
market share growth for both trucks and shovels."
Mr. Nichols added, "As we look forward to 2004, we continue to
expect end markets to remain somewhat challenging, but we are
confident in achieving improved results through leveraging our
businesses, coupled with some positive indications in the upward
movement in commodity pricing."
Capital Structure
"Cash flow from operations for the fourth quarter of 2003 was
$168.6 million, and $384.1 million for the full year 2003," commented
Phil Widman, Senior Vice President and Chief Financial Officer. "In
the fourth quarter, we generated an additional $108.4 million in cash
from reductions in working capital (defined as the sum of accounts
receivable plus inventory less accounts payable), making for a total
of $267.7 million generated for 2003, well above our annual goal of
$200 million. Our working capital as a percent of trailing three month
annualized sales decreased to 23% at the end of 2003 compared to 33%
at the end of 2002."
"Net debt (defined as total debt less cash) at the end of the
fourth quarter of 2003 decreased $314.9 million to $894.1 million from
$1,209.0 million at the end of 2002, in spite of the fact that we
consolidated an additional $33 million in debt related to acquiring a
majority interest in Tatra during the year. Net debt to book
capitalization at the end of 2003 was 50.5%, compared to 61.1% at the
end of 2002." Mr. Widman added, "Gross debt reduction totaled $261.7
million, exclusive of debt associated with the acquisitions of Tatra,
Commercial Body and Combatel and the currency translation impact on
debt. These items totaled approximately $58 million."
"We are pleased with the progress on working capital efficiency,
although significant improvement opportunities still exist in our
businesses," said Mr. Widman. "With potential growth in volume, we
will need to be disciplined with our investment in working capital."
Terex Improvement Process
Terex recently launched a series of initiatives intended to
transform the Company over the next several years. "The Terex
Improvement Process, or TIP, is our chosen methodology," stated Mr.
DeFeo. "Fundamentally, this is a change process that will improve our
internal processes and help Terex become more customer-centric. We
have grown via acquisitions, and now it is time to grow organically.
We have great products and businesses with strong individual
heritages. The challenge for Terex today is to turn this portfolio of
business into a franchise performer that delivers superior value
throughout the customer experience. This will take several years, but
it is a journey worth taking."
Mr. DeFeo continued, "We have created several TIP teams of
cross-functional and operational managers to build the Terex of
tomorrow. The teams will focus on leadership and talent development,
the customer experience / value proposition and the resulting returns
delivered to investors."
"Our vision is to have Terex grow to $6 billion of revenue in 2006
with a 10% operating margin and working capital levels of 15% of
revenue. We would expect to achieve a 20% or greater return on
invested capital (defined as operating profit excluding special items
divided by the sum of average book equity and average net debt),
compared to approximately 10.5% today, thus providing superior returns
to our owners. We will do this by becoming the most customer
responsive company in our industry and by becoming a preferred place
to work."
"Acquisition will continue to be a part of our future, but we
would expect that any meaningful transaction would have to be additive
to our goals. The Terex transformation will not be an easy journey. We
nevertheless are dedicated to the goals of making Terex a world class,
franchise player with great returns to owners, customers and
employees."
Outlook
The following outlook consists of forward-looking information
based on Terex's current expectations. Actual results could differ
materially from these projections. For further details on this, see
the Safe Harbor Statement below.
"During 2003, Terex focused on cash generation and working capital
efficiency," said Mr. DeFeo. "This emphasis will continue in 2004, and
in addition we will emphasize margin improvement throughout the
Company."
The Company offers guidance by reporting segment as follows:
Terex Construction - The Company expects net sales to be in the
range of $1,400 to $1,500 million, with operating margins in the 5.0%
to 6.0% range. Several opportunities exist in this segment, including
continued market share expansion in the lower end of the product
range, as well as benefits from initial signs of an economic recovery.
Additionally, the Terex Compact Equipment product range is now
marketed in North America through the Genie sales force, and is
beginning to penetrate the large North American rental market with a
broader Terex product offering. The Powerscreen businesses continue to
realize strong performance. Challenges include the weak U.S. dollar,
as well as competitive and end market factors in the heavy off-highway
truck market.
Terex Cranes - The Company expects net sales to be in the range of
$850 to $950 million, with operating margin in the 4.0% to 5.0% range.
Demag has provided an excellent opportunity for growth through market
share gains and a distribution platform in Europe for other Terex
Cranes products. The Italian operations are well positioned to
capitalize on organic growth opportunities. The rationalization of the
tower cranes business is complete. The North American market remains
depressed and the Company does not anticipate end market recovery
until 2005. Several new crane models will be launched this year that
will further expand Terex's product capabilities.
Terex Roadbuilding, Utility Products and Other - The Company
expects net sales to be in the range of $850 to $950 million, with
operating margin in the 3.5% to 4.5% range. The revenue growth in this
segment should be driven primarily by the inclusion of Tatra and the
related American Truck Company venture for a full year. However, these
ventures are expected to have only a modest level of profitability in
2004. With its distribution acquisitions, the Utility business
continues to penetrate the investor owned utilities market. This
distribution network is expected to provide the additional benefit of
cross-selling other Terex products, such as loader backhoes and boom
trucks. The Roadbuilding business will continue to face difficult end
markets in 2004, as uncertainty surrounds funding for domestic U.S.
highway construction at both the federal and state levels, which may
impact new equipment purchases.
Terex Aerial Work Platforms - The Company expects net sales to be
in the range of $600 to $700 million, with operating margins in the
11.0% to 12.0% range. Genie's continued excellent operating
performance and a recovering rental market should provide another year
of solid performance. Genie's export business has benefited from a
weak dollar, and should continue to provide a positive offset of the
Construction business' negative currency impact.
Terex Mining - The Company expects net sales to be in the range of
$300 to $325 million, with operating margins in the 5.0% to 6.0%
range. Recovering commodity prices, such as in coal and iron ore,
should result in increased mining, ultimately contributing to
additional capital equipment needs of customers. Continued focus on
product service costs and a favorable shift in product mix are
expected to yield a meaningful improvement in the Mining segment's
performance.
Other additional financial information:
Corporate - Unallocated corporate expenses for 2004 are estimated
to be approximately $10 million. Interest expense for the year is
estimated at $85 to $90 million and other expenses (primarily debt
amortization costs) are estimated to be $10 million. The effective tax
rate is expected to be 28% for 2004 and the average number of shares
that will be outstanding for 2004 is estimated at 50 million.
Depreciation and amortization for the Company is estimated to be in
the range of $60 to $65 million. Capital expenditures should be
approximately $30 to $35 million.
Working Capital - Terex will continue to concentrate on the
implementation of best practices across its locations, working towards
the goal of 15% for working capital as a percent of revenues. For
2004, the Company is targeting a 20% working capital investment as a
percentage of revenues, representing an improvement from 2003 actual
performance of 23%.
Capital Structure - Debt reduction will remain a focus, with a
targeted reduction in debt of $200 million in 2004. Terex's net debt /
total capitalization ratio is expected to remain below 50% during
2004.
Earnings Timing - Terex expects total Company earnings for 2004 to
be an improvement of approximately 30% - 50% versus the prior year,
before special items, although the Company realizes that the total
range of segment performance could lead to a wider range of results.
The Company's experience has been that 55% - 60% of the Company's
earnings typically are realized in the first six months of the year,
with 25% - 30% of the first six months' earnings in the first quarter.
"We expect 2004 to be a year of meaningful improvements for
Terex," commented Mr. DeFeo. "We anticipate a mix of end market
conditions, with certain products having end markets in recovery mode
while other product lines and markets will continue to be sluggish. It
is against this backdrop that we expect to have a meaningful earnings
increase and to generate strong cash flow while fundamentally
improving Terex as we continue our journey toward a vision of superior
customer responsiveness, profitability and employee motivation."
Safe Harbor Statement
The above, including the sections entitled Terex Improvement
Process and Outlook, contains forward-looking information based on
Terex's current expectations. Because forward-looking statements
involve risks and uncertainties, actual results could differ
materially. Such risks and uncertainties, many of which are beyond
Terex's control, include among others: Terex's business is highly
cyclical and weak general economic conditions may affect the sales of
its products and its financial results; the sensitivity of
construction, infrastructure and mining activity and products produced
for the military to interest rates and government spending; the
ability to successfully integrate acquired businesses; the retention
of key management personnel; Terex's businesses are very competitive
and may be affected by pricing, product initiatives and other actions
taken by competitors; the effects of changes in laws and regulations;
Terex's business is international in nature and is subject to changes
in exchange rates between currencies, as well as international
politics; the ability of suppliers to timely supply Terex parts and
components at competitive prices; the financial condition of suppliers
and customers, and their continued access to capital; Terex's ability
to timely manufacture and deliver products to customers; Terex's
significant amount of debt and its need to comply with restrictive
covenants contained in Terex's debt agreements; compliance with
applicable environmental laws and regulations; and other factors,
risks, uncertainties more specifically set forth in Terex's public
filings with the SEC. Actual events or the actual future results of
Terex may differ materially from any forward looking statement due to
those and other risks, uncertainties and significant factors. The
forward-looking statements herein 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 Terex's
expectations with regard thereto or any changes in events, conditions,
or circumstances on which any such statement is based.
Terex Corporation is a diversified global manufacturer based in
Westport, Connecticut, with 2003 revenues of $3.9 billion. Terex is
involved in a broad range of construction, infrastructure, recycling
and mining-related capital equipment under the brand names of Advance,
American, American Truck, Amida, Atlas, Bartell, Bendini, Benford,
Bid-Well, B.L. Pegson, Canica, Cedarapids, Cifali, CMI, Coleman
Engineering, Comedil, Demag, Fermec, Finlay, Franna, Fuchs, Genie,
Grayhound, Hi-Ranger, Italmacchine, Jaques, Johnson-Ross, Koehring,
Lectra Haul, Load King, Lorain, Marklift, Matbro, Morrison, Muller,
O&K, Payhauler, Peiner, Powerscreen, PPM, Re-Tech, RO, Royer, Schaeff,
Simplicity, Square Shooter, Tatra, Telelect, Terex, and Unit Rig.
Terex offers a complete line of financial products and services to
assist in the acquisition of Terex equipment through Terex Financial
Services. More information on Terex can be found at www.terex.com.
TEREX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(in millions, except per share data)
(unaudited)
Three Months Twelve Months
Ended December Ended December
31, 31,
-------------- ----------------
2003 2002 2003 2002
----- ----- ----- -----
Net sales $1,014.3 $ 851.1 $3,897.1 $2,797.4
Cost of goods sold 875.8 786.3 3,378.6 2,440.7
--------- -------- --------- ---------
Gross profit 138.5 64.8 518.5 356.7
Selling, general and
administrative expenses 114.4 100.3 393.7 288.1
Goodwill impairment --- --- 51.3 ---
--------- -------- --------- ---------
Income (loss) from operations 24.1 (35.5) 73.5 68.6
Other income (expense):
Interest income 1.7 2.8 7.1 7.5
Interest expense (24.1) (26.0) (99.9) (92.9)
Loss on retirement of debt (9.0) --- (11.9) (2.4)
Other income (expense) - net (0.5) (0.6) (4.1) (9.0)
--------- -------- --------- ---------
Loss before income taxes and
cumulative effect of change in
accounting principle (7.8) (59.3) (35.3) (28.2)
Benefit from income taxes 7.2 19.0 9.8 9.1
--------- -------- --------- ---------
Loss before cumulative effect of
change in
accounting principle (0.6) (40.3) (25.5) (19.1)
Cumulative effect of change in
accounting principle --- --- --- (113.4)
--------- -------- --------- ---------
Net loss $ (0.6) $ (40.3) $ (25.5) $ (132.5)
========= ======== ========= =========
EARNINGS PER SHARE: -
Basic:
Loss before cumulative
effect of change in
accounting principle (0.01) (0.85) (0.53) (0.44)
Cumulative effect of change
in accounting principle --- --- --- (2.63)
--------- -------- --------- ---------
Net income (loss) $ (0.01) $ (0.85) $ (0.53) $ (3.07)
========= ======== ========= =========
Diluted:
Loss before cumulative
effect of change in
accounting principle (0.01) (0.85) (0.53) (0.44)
Cumulative effect of change
in accounting principle --- --- --- (2.63)
--------- -------- --------- ---------
Net income (loss) $ (0.01) $ (0.85) $ (0.53) $ (3.07)
========= ======== ========= =========
Weighted average number of
common and common equivalent
shares outstanding in per share
calculation:
Basic 48.1 47.4 47.7 43.2
Diluted 48.1 47.4 47.7 43.2
TEREX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions, except par value)
(unaudited)
December December
31, 31,
2003 2002
-------- --------
CURRENT ASSETS
Cash and cash equivalents $ 467.5 $ 352.2
Trade receivables 540.2 578.6
Inventories 1,009.7 1,106.3
Other current assets 175.2 184.0
--------- ---------
Total Current Assets 2,192.6 2,221.1
LONG-TERM ASSETS
Property, plant and equipment 370.1 309.4
Goodwill 609.5 622.9
Other assets 554.6 472.3
--------- ---------
TOTAL ASSETS $3,726.8 $3,625.7
========= =========
CURRENT LIABILITIES
Notes payable and current portion of long-term
debt $ 86.8 $ 74.1
Trade accounts payable 608.6 542.9
Accrued compensation and benefits 94.5 74.0
Accrued warranties and product liability 88.5 86.0
Other current liabilities 282.8 329.2
--------- ---------
Total Current Liabilities 1,161.2 1,106.2
NON CURRENT LIABILITIES
Long-term debt, less current portion 1,274.8 1,487.1
Other 414.1 263.2
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Common Stock, $0.01 par value --
Authorized 150.0 shares; issued 50.0 and 48.6
shares at December 31, 2003 and 2002,
respectively 0.5 0.5
Additional paid-in capital 795.1 772.7
Retained earnings 41.9 67.4
Accumulated other comprehensive income (loss) 57.0 (53.6)
Less cost of shares of common stock in treasury
(1.2 shares at December 31, 2003 and 2002) (17.8) (17.8)
--------- ---------
Total Stockholders' Equity 876.7 769.2
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $3,726.8 $3,625.7
========= =========
TEREX CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(in millions)
(unaudited)
Twelve Months
Ended December
31,
--------------
2003 2002
-------- --------
OPERATING ACTIVITIES
Net income (loss) $ (25.5) $(132.5)
Adjustments to reconcile net income (loss) to cash
provided by (used in) operating
activities:
Depreciation 55.2 35.9
Amortization 15.2 9.1
Impairment charges and asset write downs 72.5 140.8
Restructuring charges --- 50.9
Deferred taxes --- (35.2)
Loss on retirement of debt 10.4 1.6
Gain on foreign currency futures --- (3.8)
Gain on sale of fixed assets (4.5) (0.7)
Changes in operating assets and liabilities (net
of effects of acquisitions):
Trade receivables 83.3 11.6
Inventories 189.0 (52.7)
Trade accounts payable (4.6) 86.5
Other, net (6.9) (41.2)
-------- --------
Net cash provided by operating activities 384.1 70.3
-------- --------
INVESTING ACTIVITIES
Acquisition of businesses, net of cash acquired (7.7) (445.9)
Capital expenditures (27.1) (29.2)
Proceeds from sale of assets 6.1 34.5
-------- --------
Net cash used in investing activities (28.7) (440.6)
-------- --------
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt, net of
issuance costs 290.4 572.0
Principal repayments of long-term debt (454.5) (219.6)
Net borrowings (repayments) under revolving line of
credit agreements (65.0) (0.8)
Issuance of common stock --- 113.3
Payment of premium on early retirement of debt (11.1) ---
Other (29.4) (4.9)
-------- --------
Net cash provided by (used in) financing
activities (269.6) 460.0
-------- --------
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS 29.5 12.1
-------- --------
NET INCREASE IN CASH AND CASH EQUIVALENTS 115.3 101.8
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 352.2 250.4
-------- --------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 467.5 $ 352.2
======== ========
Table I
-------
TEREX CORPORATION AND SUBSIDIARIES
(in millions)
(unaudited)
Three Months Ended December 31,
-------------------------------------
2003
-------------------------------------
Special Excluding
GAAP Items Special Items
-------- --------- -------------
Sales
Construction (1) $ 351.4 $ --- $ 351.4
Cranes (2) 260.1 --- 260.1
Roadbuilding & Utility (3) 220.3 --- 220.3
Aerial Work Platforms (4) 132.5 --- 132.5
Mining 75.0 --- 75.0
Corp / Eliminations (25.0) --- (25.0)
---------- --------- -----------
Total $ 1,014.3 $ --- $ 1,014.3
========== ========= ===========
Gross Profit
Construction (1) $ 37.7 $ 4.5 $ 42.2
Cranes (2) 28.0 5.3 33.3
Roadbuilding & Utility (3) 30.6 (0.9) 29.7
Aerial Work Platforms (4) 31.3 --- 31.3
Mining 11.4 --- 11.4
Corp / Eliminations (0.5) --- (0.5)
---------- --------- -----------
Total $ 138.5 $ 8.9 $ 147.4
========== ========= ===========
SG&A
Construction (1) $ 31.2 $ (0.9) $ 30.3
Cranes (2) 25.8 (0.5) 25.3
Roadbuilding & Utility (3) 22.2 --- 22.2
Aerial Work Platforms (4) 17.2 --- 17.2
Mining 9.0 --- 9.0
Corp / Eliminations 9.0 (8.4) 0.6
---------- --------- -----------
Total $ 114.4 $ (9.8) $ 104.6
========== ========= ===========
Operating Income
Construction (1) $ 6.5 $ 5.4 $ 11.9
Cranes (2) 2.2 5.8 8.0
Roadbuilding & Utility (3) 8.4 (0.9) 7.5
Aerial Work Platforms (4) 14.1 --- 14.1
Mining 2.4 --- 2.4
Corp / Eliminations (9.5) 8.4 (1.1)
---------- --------- -----------
Total $ 24.1 $ 18.7 $ 42.8
========== ========= ===========
Three Months Ended December 31,
-------------------------------------
2002
-------------------------------------
Special Excluding
GAAP Items Special Items
-------- --------- -------------
Sales
Construction (1) $ 274.9 $ (2.4) $ 272.5
Cranes (2) 269.0 (1.6) 267.4
Roadbuilding & Utility (3) 136.8 --- 136.8
Aerial Work Platforms (4) 101.8 --- 101.8
Mining 74.7 --- 74.7
Corp / Eliminations (6.1) --- (6.1)
---------- --------- -----------
Total $ 851.1 $ (4.0) $ 847.1
========== ========= ===========
Gross Profit
Construction (1) $ 29.7 $ 12.1 $ 41.8
Cranes (2) (1.9) 29.7 27.8
Roadbuilding & Utility (3) 19.5 3.6 23.1
Aerial Work Platforms (4) 16.5 2.8 19.3
Mining 1.2 2.6 3.8
Corp / Eliminations (0.2) --- (0.2)
---------- --------- -----------
Total $ 64.8 $ 50.8 $ 115.6
========== ========= ===========
SG&A
Construction (1) $ 31.2 $ (4.7) $ 26.5
Cranes (2) 24.1 (3.6) 20.5
Roadbuilding & Utility (3) 17.2 (0.7) 16.5
Aerial Work Platforms (4) 13.8 --- 13.8
Mining 7.2 --- 7.2
Corp / Eliminations 6.8 (5.5) 1.3
---------- --------- -----------
Total $ 100.3 $ (14.5) $ 85.8
========== ========= ===========
Operating Income
Construction (1) $ (1.5) $ 16.8 $ 15.3
Cranes (2) (26.0) 33.3 7.3
Roadbuilding & Utility (3) 2.3 4.3 6.6
Aerial Work Platforms (4) 2.7 2.8 5.5
Mining (6.0) 2.6 (3.4)
Corp / Eliminations (7.0) 5.5 (1.5)
---------- --------- -----------
Total $ (35.5) $ 65.3 $ 29.8
========== ========= ===========
(1) Special items relate primarily to the closure of the Kilbeggan
facility within the Powerscreen business.
(2) Special items relate to the closure of the Peiner facility within
the tower crane group, closure of the RO boom truck facility, and
the Demag inventory fair value accounting treatment.
(3) Special items relate to restructuring actions, exiting and
rationalization certain product categories with the Roadbuilding
group and write-down of certain assets within the EarthKing
business.
(4) Special items relate to the Genie inventory fair value accounting
treatment.
Table I (continued)
TEREX CORPORATION AND SUBSIDIARIES
(in millions)
(unaudited)
Twelve Months Ended
December 31,
--------------------------
2003
--------------------------
Excluding
Special Special
GAAP Items Items
--------------------------------
Sales
Construction (1) $1,359.5 $ --- $ 1,359.5
Cranes (2) 1,005.1 --- 1,005.1
Roadbuilding & Utility (3) 711.9 --- 711.9
Aerial Work Platforms (4) 583.6 --- 583.6
Mining 294.5 --- 294.5
Corp / Eliminations (57.5) --- (57.5)
---------- -------- ----------
Total $3,897.1 $ --- $ 3,897.1
========== ======== ==========
Gross Profit
Construction (1) $ 172.4 $ 6.6 $ 179.0
Cranes (2) 102.5 15.9 118.4
Roadbuilding & Utility (3) 68.3 30.4 98.7
Aerial Work Platforms (4) 127.2 0.8 128.0
Mining 48.7 0.2 48.9
Corp / Eliminations (0.6) --- (0.6)
---------- --------- ----------
Total $ 518.5 $ 53.9 $ 572.4
========= ========= ==========
SG&A
Construction (1) $ 118.1 $ (1.5) $ 116.6
Cranes (2) 86.6 (1.2) 85.4
Roadbuilding & Utility (3) 79.2 (2.0) 77.2
Aerial Work Platforms (4) 59.4 --- 59.4
Mining 34.3 --- 34.3
Corp / Eliminations 16.1 (13.0) 3.1
--------- -------- ----------
Total $ 393.7 $ (17.7) $ 376.0
========= ========= ==========
Operating Income
Construction (1) $ 54.3 $ 8.1 $ 62.4
Cranes (2) 15.9 17.1 33.0
Roadbuilding & Utility (3) (62.2) 83.7 21.5
Aerial Work Platforms (4) 67.8 0.8 68.6
Mining 14.4 0.2 14.6
Corp / Eliminations (16.7) 13.0 (3.7)
--------- -------- ----------
Total $ 73.5 $ 122.9 $ 196.4
========= ======== ==========
Twelve Months Ended
December 31,
---------------------------
2002
---------------------------
Excluding
Special Special
GAAP Items Items
----------------------------
Sales
Construction (1) $1,174.5 $ (11.6) $ 1,162.9
Cranes (2) 717.9 (17.1) 700.8
Roadbuilding & Utility (3) 562.4 --- 562.4
Aerial Work Platforms (4) 149.4 --- 149.4
Mining 282.8 --- 282.8
Corp / Eliminations (89.6) 16.0 (73.6)
--------- --------- -----------
Total $2,797.4 $ (12.7) $ 2,784.7
========= ======== ===========
Gross Profit
Construction (1) $ 164.7 $ 12.6 $ 177.3
Cranes (2) 57.1 32.4 89.5
Roadbuilding & Utility (3) 91.4 15.7 107.1
Aerial Work Platforms (4) 21.2 4.0 25.2
Mining 22.9 6.8 29.7
Corp / Eliminations (0.6) 0.2 (0.4)
---------- -------- ---------
Total $ 356.7 $ 71.7 $ 428.4
========= ======== =========
SG&A
Construction (1) $ 107.7 $ (5.8) $ 101.9
Cranes (2) 55.1 (4.6) 50.5
Roadbuilding & Utility (3) 73.0 (1.3) 71.7
Aerial Work Platforms (4) 17.0 --- 17.0
Mining 27.3 --- 27.3
Corp / Eliminations 8.0 (4.6) 3.4
--------- -------- ---------
Total $ 288.1 $ (16.3) $ 271.8
========= ======== ==========
Operating Income
Construction (1) $ 57.0 $ 18.4 $ 75.4
Cranes (2) 2.0 37.0 39.0
Roadbuilding & Utility (3) 18.4 17.0 35.4
Aerial Work Platforms (4) 4.2 4.0 8.2
Mining (4.4) 6.8 2.4
Corp / Eliminations (8.6) 4.8 (3.8)
--------- -------- ----------
Total $ 68.6 $ 88.0 $ 156.6
========= ======== ==========
(1) Special items relate primarily to the closure of the Kilbeggan
facility within the Powerscreen business.
(2) Special items relate primarily to the closure of the Peiner
facility within the Tower Crane group.
(3) Special items relate primarily to exiting and rationalizing
certain product categories within the Roadbuilding group.
(4) Special items relate to the Genie inventory fair value accounting
treatment
CONTACT: Terex Corporation
Investor Relations
Tom Gelston, 203-222-5943
SOURCE: Terex Corporation