Manitowoc 2009 sales down, order intake positive
By Alex Dahm03 February 2010
Sales for 2009 at the Manitowoc Company were US$3.8 billion, down $704.2 million or 16%, from $4.5 billion in 2008.
By segment, this total for 2009 was divided as $2.3 billion from Cranes and $1.5 billion from the Foodservice division. The split in 2008 of the $4.5 billion total was $3.9 billion from cranes and $0.6 billion from Foodservice.
Crane segment order backlog was $573 million at the end of 2009, 14% less than the $667 million backlog at 30 September 2009. "The percentage decline in backlog diminished in the fourth quarter as the net positive order flow trend that began in March continued through December," said Glen Tellock, Manitowoc chairman and CEO.
"The trend in our orders reflects improvement in current demand levels, most notably from Asia, Latin America, Africa, and the Middle East. We believe our strong position in emerging markets, as well as the global restructuring that we have been implementing should enable us to restore Crane segment revenue and earnings growth as the market improves," Tellock continued.
Another positive was the debt reduction of about $475 million for 2009, exceeding the $450 million target.
Manitowoc defines adjusted EBITDA as earnings before interest, taxes, depreciation, and amortization, plus certain items such as pro-forma acquisition results and the add-back of certain restructuring charges, that are adjustments per the credit agreement definition. The Manitowoc Company's trailing twelve-month adjusted EBITDA for covenant compliance purposes as at 31 December 2009 was $383.2 million.
For the fourth quarter of 2009, Manitowoc Company sales were $838.7 million, down 31% from $1.2 billion in the fourth quarter of 2008. The decrease was attributed largely to a 49% decline in the Crane segment over the same quarter in 2008 (at $480.2 million, which was down from $943.6 million) partially offset by a 31% increase in the Foodservice segment. Crane sales in the fourth quarter of 2009 "were essentially even with those in the third quarter of 2009," Manitowoc said.
"Although we continue to be faced with a challenging business environment, we are encouraged by recently improving metrics and trends for 2010" commented Tellock.
"We clearly exceeded our adjusted targets for cash flow and debt reduction, Foodservice margin targets were achieved, and Crane segment revenue was maintained at third-quarter levels. We also expect that 2010 will see increasing benefits from the operational efficiencies, process improvements, cost reductions, and synergies that we implemented in 2009," Tellock continued.
On 22 January 2010 Manitowoc amended financial covenants and terms of its senior credit agreement to allow additional flexibility. A minimum of $300 million of senior unsecured notes have to be issued and all net proceeds have to be used to pay down senior secured term debt. The company has commenced an offering to issue $400 million of senior unsecured notes and expects to complete the offering in the near term.