•  Q1 Earnings per Share $0.79, $0.87 as adjusted
•  Increased Sales 2%, up 6% excluding the impact of FX
•  Backlog up 2%, up 6% excluding the impact of FX
•  Expect full year EPS in the upper half of our previously announced range of $3.60 to $4.20

WESTPORT, Conn., April 30, 2019 (GLOBE NEWSWIRE) -- Terex Corporation (NYSE: TEX) today announced first quarter 2019 income from continuing operations of $57.2 million, or $0.79 per share, on net sales of $1.1 billion.  In the first quarter of 2018, the reported income from continuing operations was $68.7 million, or $0.84 per share, on net sales of $1.1 billion.  Income from continuing operations, as adjusted, for the first quarter of 2019 was $62.3 million, or $0.87 per share. This compares to income from continuing operations, as adjusted, of $69.9 million or $0.85 per share in the first quarter of 2018. The Glossary at the end of this press release contains further details regarding these non-GAAP measures.

“Overall we had a strong first quarter,” stated John L. Garrison, Terex Chairman and CEO. “Our improving financial results, with adjusted operating margins greater than 9% and adjusted EPS increasing over 50% from what we presented in our Q1 earnings release in May 2018, clearly demonstrate the impact of executing our Focus, Simplify and Execute to Win strategy.”

“Building on an excellent 2018, Materials Processing (MP) increased sales and expanded operating margin again in the first quarter.”  Mr. Garrison continued, “MP’s global markets remained strong and backlog continued to grow, increasing 17% on an FX-neutral basis.”

“Aerial Work Platforms (AWP) started slower than last year, but gained momentum throughout the quarter. Revenue and operating margin were impacted by severe weather across the United States including a week-long closure of AWP’s principal manufacturing and distribution facilities in Washington state.  Additionally, the strength of the U.S. dollar, particularly against the Euro, represented a headwind in the quarter.”  Mr. Garrison added, “AWP is well positioned heading into the second quarter with $1.1 billion of backlog.”

Mr. Garrison continued, “The previously announced agreement to sell the Demag® Mobile Cranes business remains on track to close mid-year, subject to government regulatory approvals and other customary closing conditions. We implemented our new two-segment structure, and are moving forward with plans to further simplify our corporate organization and reduce general and administrative expenses.”

“We continue to invest in our Execute to Win business system, which remains focused on enhancing our capabilities in Commercial Excellence, Lifecycle Solutions and Strategic Sourcing,” commented Mr. Garrison.  “We are seeing benefits from each of these areas in our financial performance.”

Mr. Garrison concluded, “As a result of our first quarter performance, we now expect full year EPS to be in the upper half of our previously announced range of $3.60 to $4.20, excluding restructuring, transformation investments, and other unusual items, on net sales of approximately $4.7 billion.”

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 Company provides guidance on a non-GAAP basis as the Company cannot predict with a reasonable degree of certainty the timing and magnitude of future charges that would be included in the reported GAAP results.

The Glossary at the end of this press release contains further details about this subject.

Total amounts in tables of this release may not add due to rounding.

Conference call

The Company has scheduled a one hour conference call to review the financial results on Wednesday, May 1, 2019 at 8:30 a.m. ET.  John L. Garrison, Chairman and CEO, will host the call.  A simultaneous webcast of this call can be accessed at https://investors.terex.com.  Participants are encouraged to access the call 10 minutes prior to the starting time. The call will also be archived in the Event Archive at https://investors.terex.com.

Contact Information:

Terex Corporation
Brian J. Henry, Senior Vice President
Business Development & Investor Relations
(203) 222-5954
[email protected]
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,” “intends,” “anticipates,” “plans,” “projects,” “estimates” 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 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; 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, intellectual property claims, class action lawsuits 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 Execute to Win 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 Corporation is a global manufacturer of aerial work platforms, materials processing and crane products and services that deliver lifecycle solutions to maximize customer return on investment.  The Company reports in two business segments: Aerial Work Platforms and Materials Processing.  Terex delivers lifecycle solutions to a broad range of industries, including the construction, infrastructure, manufacturing, shipping, transportation, refining, energy, utility, quarrying and mining industries.  Terex offers financial products and services to assist in the acquisition of Terex equipment through Terex Financial Services.  Terex uses its website (www.terex.com) and its Facebook page (www.facebook.com/TerexCorporation) to make information available to its investors and the market.

 

 
TEREX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
(in millions, except per share data)
  Three Months Ended
March 31,
  
  2019 2018
Net sales $1,136.6  $1,116.6 
Cost of goods sold  (898.8)  (888.0)
Gross profit  237.8   228.6 
Selling, general and administrative expenses  (138.1)  (134.3)
Income (loss) from operations  99.7   94.3 
Other income (expense)      
Interest income  1.7   3.3 
Interest expense  (23.0)  (15.9)
Other income (expense) – net  (3.2)  1.2 
Income (loss) from continuing operations before income taxes  75.2   82.9 
(Provision for) benefit from income taxes  (18.0)  (14.2)
Income (loss) from continuing operations  57.2   68.7 
Income (loss) from discontinued operations – net of tax  (124.4)  (21.1)
Gain (loss) on disposition of discontinued operations- net of tax  0.6   2.7 
Net income (loss) $(66.6) $50.3 
Basic Earnings (Loss) per Share:      
Income (loss) from continuing operations $0.81  $0.86 
Income (loss) from discontinued operations – net of tax  (1.76)  (0.26)
Gain (loss) on disposition of discontinued operations – net of tax  0.01   0.03 
Net income (loss) $(0.94) $0.63 
Diluted Earnings (Loss) per Share:      
Income (loss) from continuing operations $0.79  $0.84 
Income (loss) from discontinued operations – net of tax  (1.73)  (0.26)
Gain (loss) on disposition of discontinued operations – net of tax  0.01   0.04 
Net income (loss) $(0.93) $0.62 
Weighted average number of shares outstanding in per share calculation      
Basic  70.6   79.7 
Diluted  71.8   81.7 

 

 
TEREX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(unaudited)
 (in millions, except par value)
 March 31, 2019 December 31, 2018
  
Assets     
Current assets     
Cash and cash equivalents$304.6 $339.5
Other current assets 1,796.8  1,624.0
Current assets held for sale 406.6  459.5
Total current assets 2,508.0  2,423.0
Non-current assets     
Property, plant and equipment – net 327.6  317.3
Other non-current assets 812.4  677.2
Non-current assets held for sale 6.8  68.4
Total non-current assets 1,146.8  1,062.9
Total assets$3,654.8 $3,485.9
      
Liabilities and Stockholders’ Equity     
Current liabilities     
Notes payable and current portion of long-term debt$6.1 $4.1
Other current liabilities 954.7  1,031.1
Current liabilities held for sale 142.4  179.5
Total current liabilities 1,103.2  1,214.7
Non-current liabilities     
Long-term debt, less current portion 1,467.3  1,210.6
Other non-current liabilities 211.7  113.1
Non-current liabilities held for sale 90.3  86.5
Total non-current liabilities 1,769.3  1,410.2
Total liabilities 2,872.5  2,624.9
      
Total stockholders’ equity 782.3  861.0
Total liabilities and stockholders’ equity$3,654.8 $3,485.9
      

 

  
TEREX CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
(in millions)
 
 Three Months Ended
March 31,
 
 
 2019  2018  
Operating Activities    
Net income (loss)$(66.6) $50.3  
Depreciation and amortization 13.5   16.0  
Changes in operating assets and liabilities and non-cash charges (212.3)  (110.7) 
Net cash provided by (used in) operating activities (265.4)  (44.4) 
Investing Activities      
Capital expenditures (10.8)  (34.5) 
Other investing activities, net 0.2   19.2  
Net cash provided by (used in) investing activities (10.6)  (15.3) 
Financing Activities      
Net cash provided by (used in) financing activities 236.4   (128.3) 
Effect of exchange rate changes on cash and cash equivalents (2.3)  9.3  
Net increase (decrease) in cash and cash equivalents (41.9)  (178.7) 
Cash and cash equivalents at beginning of period 372.1   630.1  
Cash and cash equivalents at end of period$330.2  $451.4  
       

 

  
TEREX CORPORATION AND SUBSIDIARIES
SEGMENT RESULTS DISCLOSURE
(unaudited)
(in millions)
 
 Q1 
 2019 2018  
   % of  % of 
Net SalesNet Sales 
Consolidated       
Net sales$1,136.6  $1,116.6   
Income from operations$99.7 8.8%$94.3 8.4% 
        
AWP       
Net sales$727.9  $737.5   
Income from operations$59.6 8.2%$70.2 9.5% 
        
MP       
Net sales$346.2  $315.9   
Income from operations$49.2 14.2%$39.9 12.6% 
        
Corp and Other / Eliminations       
Net sales$62.5  $63.2   
Loss from operations$(9.1)*$(15.8)* 
* - 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 March 31, 2019, unless otherwise indicated.

2019 Outlook:  The Company’s 2019 outlook for earnings per share and 2019 full year adjusted forecasted tax rate are non-GAAP financial measures because they exclude items such as restructuring and other related charges, transformation costs, the impact of the release of tax valuation allowances, gains and losses on divestitures and other unusual items. The Company is not able to reconcile these forward-looking non-GAAP financial measures to their most directly comparable forward-looking GAAP financial measures without unreasonable efforts because the Company is unable to predict with a reasonable degree of certainty the exact timing and impact of such items. The unavailable information could have a significant impact on the Company’s full-year 2019 GAAP financial results. Adjusted EPS provides guidance to investors about the Company's EPS expectations excluding restructuring and other charges that the Company does not believe is reflective of its ongoing operations.

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.

The Company has included a presentation from the financial results for the quarter ended March 31, 2018 as reported on May 1, 2018 to the financial results for the quarter ended March 31, 2019 as reported today, as the Company believes this presentation more fully highlights the change in financial results caused by decisions made by the Company's management since May 1, 2018.

Q1 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) $75.2 (18.0)57.2 $0.79 
Restructuring & Related 1.7 (0.4)1.3 0.02 
Transformation 4.1 (0.7)3.4 0.05 
Deal Related 0.2  0.2  
Other (2.4) (2.4)(0.03)
Tax & Interim Period (3)  2.6 2.6 0.04 
As Adjusted (Non-GAAP) $78.8 (16.5)62.3 $0.87 
      
(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

 

 

Q1 2018 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 Originally Reported (May 1, 2018) $59.0 (11.4)47.6 $0.59 
Restructuring & Related (2.2)(0.2)(2.4)(0.03)
Transformation 7.3 (1.2)6.1 0.07 
Extinguishment of Debt 0.7 (0.1)0.6 0.01 
Other (6.9)0.6 (6.3)(0.08)
Tax & Interim Period (3)  (1.0)(1.0)(0.01)
As Originally Adjusted (May 1, 2018) $57.9 (13.3)44.6 $0.55 
(Income) loss from discontinued operations 23.9 (2.8)21.1 0.26 
Discontinued Operations Adjustments (4) 2.4 1.8 4.2 0.04 
As Adjusted (Non-GAAP) $84.2 (14.3)69.9 $0.85 
      
(1) Tax effect on adjustments is calculated using the applicable jurisdictional blended tax rate
(2) Based on diluted weighted average shares outstanding of 81.7 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
(4) Includes Restructuring & Related, Transformation, and Tax & Interim Period adjustments

 

 

Q1 2018 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) $82.9 (14.2)68.7 $0.84 
Restructuring & Related 1.1 (0.3)0.8 0.01 
Transformation 6.3 (1.1)5.2 0.06 
Extinguishment of Debt 0.7 (0.1)0.6 0.01 
Other (6.8)0.6 (6.2)(0.08)
Tax & Interim Period (3)  0.8 0.8 0.01 
As Adjusted (Non-GAAP) $84.2 (14.3)69.9 $0.85 
      
(1) Tax effect on adjustments is calculated using the applicable jurisdictional blended tax rate
(2) Based on diluted weighted average shares outstanding of 81.7 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

 

 

Q1 2019 Operating Margin Net Sales from
Continuing Operations
Income (loss) from
Operations
Operating Margin
As Reported (GAAP) $1,136.6 99.7 8.8%
Restructuring & Related  1.7  
Transformation  4.1  
Deal Related  0.2  
As Adjusted (Non-GAAP) $1,136.6 105.7 9.3%