Improvement continues at Terex Cranes
By Alex Dahm26 July 2012
Net sales at Terex Cranes for the second quarter of 2012 increased 4.3% to US$ 484.2 million compared with the second quarter of 2011. Taking into account the translation effect of currency exchange rates, that figure would be 12%.
Driving the growth was strong demand for rough terrain cranes and improving demand for all terrain cranes in North America, the Middle East and Latin America, as well as strength in Australia, Terex said. Income was 9% ($43.5 million) of net sales compared with a $34.0 million loss (7.3%) in the same period a year earlier.
On 1 July 2012 the Terex port equipment business owned before the purchase of Demag and Gottwald was taken out of the Cranes segment and added to the Material Handling & Port Solutions (MHPS) segment. MHPS was the segment formed from the August 2011 acquisition of Demag Cranes AG, which included Gottwald port cranes. Excluding the port equipment business results, the operating margin for the Cranes segment would have been around 11% in the second quarter of 2012, Terex said.
"We are pleased with how the company performed this past quarter. Our historical businesses continued to grow with improved price realisation and reduced expenses (both manufacturing and SG&A) due to actions taken in the prior year. Consequently, the overall operating margin increased significantly to 8.7%, and to 9.9%, excluding the Demag Cranes AG acquisition. Our Aerial Work Platforms (AWP) and Cranes segments had strong performances and are well positioned for continued improvement in the second half of the year. The Construction segment returned to profitability for the first time since 2008 and Materials Processing continued their positive trend. Overall, we believe the strength in our AWP and Cranes segments, as well as in North America and select other markets like Australia, will offset the weakness we expect to experience in certain markets during the second half of the year," said Ron DeFeo, Terex chairman and CEO.
For the whole Terex Corporation net sales were $2,011.5 million in the second quarter of 2012, up 35.2% from $1,488.2 million in the second quarter of 2011. Excluding the impact of the acquisition of Demag, net sales were up about 11%. When taking into account the effect of foreign currency exchange rates, net sales were up about 40% and 16% excluding the acquisition.