10.08.2021

Tadano bounces back into profit

Tadano has released its first quarter financial results showing flat revenues but a return to profitability.

Total sales for the three months to the end of June were ¥42.3 billion ($382.8 million), marginally below that recorded for the same period in 2020. This was due to a 16.6 percent drop in exports to ¥21.8 billion ($197.4 million), partly offset by higher domestic sales in Japan, which increased just over 20 percent to ¥20.5 billion ($185.5 million). When it comes to profit though, ‘ordinary income’ - essentially pre-tax profit before exceptional gains or losses - came in at ¥735 million ($6.65 million) compared to an ¥825 million ($7.5 million) loss in the same period last year. The improvement was due to higher sales prices plus lower SG&A costs.

The company also recorded an exceptional gain from its restructuring efforts in Europe which amounted to ¥10.8 billion ($98.2 million). This took pre-tax profits to ¥11.6 billion ($104.8 million) compared to a ¥723 million ($6.5 million) loss last year.

Sales by product type
Mobile cranes were down 10.7 percent to ¥23.7 billion ($214.7 million), Loader cranes sales increased 13.9 percent to ¥4.9 billion ($44 million), Aerial Work Platforms sales improved almost 16 percent to ¥3.65 billion ($33 million) and Other revenues - mainly parts, services and used equipment - were ¥10.1 billion ($91 million), up 9.1 percent on last year.

Sales by region
Europe recorded sales of ¥4.8 billion ($43.6 million), a drop of 43 percent on the year, North America saw a 14.3 percent fall to ¥8.45 billion ($76.5 million), while South/Central America saw sales plummet 90.1 percent to ¥160 million ($1.04 million). On a positive note Asia improved 2.9 percent to ¥2.9 billion ($26.4 million), the Middle East increased 19.1 percent to ¥1.6 billion ($14.6 million) while sales to Others - Oceania, Africa and CIS states - more than doubled to ¥3.85 billion ($34.8 million).

Half year forecast
The company has improved its half year forecasts in terms of profits and believes that sales will have caught up and exceeded that of 2020 by the time we reach the end of September., with total revenues expected to be ¥ 100 billion ($905 million) with an ordinary profit of ¥1.2 billion ($10.9 million) compared to a ¥1.59 billion ($14.4 million) loss at the half way point last year. For pre-tax profits the extraordinary profit carries over from the first quarter.

Vertikal Comment

This is an interesting set of numbers in that the comparative period was possibly the worst quarter for the business in recent years - although clearly not in Japan. The pick up in profitability is encouraging and likely to gather steam as further cost savings from the ongoing restructuring come into play.

The second quarter is clearly going better than expected and baring any supply chain issues the company looks to heading back towards profit growth after struggling over the past 18 months or so. The company is preparing now for its full rebranding under a single brand which may well carry some concerns but overall, the direction of travel is beginning to look more positive.