11.03.2016

Acquisitions save Manitex

Crane manufacturer Manitex has published its full year results with revenues up more than 50 percent thanks to PM and ASV acquisitions.

Total revenue for the year increased 56 percent to $386.7 million thanks to a $93 million contribution from PM Group and $116.9 million from ASV. The lifting division which comprises, Manitex boom trucks, Valla cranes, Ferrari marine lifting equipment and PM Group, saw revenues increase by more than 14 percent to $261.2 million. Without the PM Group revenue contribution however, sales would have fallen 26 percent.

Last year’s pre-tax profit of $12.5 million for the 12 months was converted to a $4.5 million loss for 2015.

Total revenues in the fourth quarter were 50 percent higher at $93.5 million, of which $66.8 million came from the lifting equipment division- up 21 percent on 2014. The company recorded a pre-tax loss for the period of $5.1 million compared to a profit in 2014 of $1.3 million.

The order book/backlog at the end of December was 82.5 million, 16 percent down on the same time last year and 3.6 percent down on the quarter.

Chief executive Andrew Rooke said: “Results for the year and the fourth quarter were significantly impacted by the reduced demand for our higher tonnage crane product that has been created by the energy sector slowdown and the redeployment of existing oil field equipment into other markets, and also by the negative impact of the stronger dollar on currency translation for both revenues and operating income. In fact, currency exchange rates accounted for $28.3 million in lower sales for the year. Our recent acquisitions provided welcome diversification and counter balancing and sales under our military contracts at Liftking ramped up during the fourth quarter and are expected to expand more consistently next year”.

"PM is securing orders on an international basis and is operating in a market of growing demand where we have not been competing until this year. ASV branded product is increasing its penetration into its new distribution network and will provide broader sales coverage in North America as we move forward and also provide margin support in an aggressive pricing environment. Cost control and debt reduction are our highest priorities as we rebalance after the recent acquisition activities. Our cost reduction initiative achieved $5.0 million in annual cost savings, exceeding our $4.0 million target despite lower volumes, and the actions put into place should deliver the $15 million savings over three year goal we established. We have reduced our debt by $45.0 million since the start of the year as adjusted for the acquisition of PM and remain committed to continue this in 2016.”

Vertikal Comment

There is too much going on at Manitex at the moment to take any particular view, the two big acquisitions have transformed revenues, but has come at a time when currency factors and troubles in the Oil & Gas sector have taking a chunk out of the results. 2016 will be a year for Manitex to continue to integrate, streamline and develop the expanded business, while reducing its debt load. While 2016 should see some significant improvements, the sluggish boom truck market is likely to continue to take the shine off of any achievements in 2016. So look to 2017 for the company to start going places.

If it can maintain a steady pace and exploit what it has, the future could still be very bright - we will take another view at the half year point.