Manitowoc sales drop 20% in Q3, with decline in ME
Manitowoc results reveal a stark deterioration across revenue, operating performance and orders, with the expectation of recovery only in the long-term
Manitowoc’s crane sales in Q3 2016 were $350m, down more than 20% on the $438m in Q3 2015 – primarily due to the deterioration of mobile crane markets in North America and the Middle East.
Overall a net loss of $140m was reported for Q3 2016 against an income of $4.8m in Q3 2015, with $97m of impairment charges related to software and the relocation of crawler and tower crane operations, and a further $3.9m spend on restructuring and severance costs.
Barry Pennypacker, president and CEO of Manitowoc, said: “The mobile crane market continued its downward trend in the third-quarter and remains very challenging. The weak global oil and gas market, coupled with lower used equipment prices, continues to have a negative effect on demand.
“Our tower crane business continues to perform as expected and we look forward to its continued success as the new line of HUP (self-erecting) products are introduced in the fourth-quarter.”
Manitowoc’s backlog of crane orders meanwhile totalled $354m for Q3 2016, down from a backlog of $394m in Q2 2016, while the orders for Q3 2016, standing at $310m, were approximately $28m or 8% lower compared to Q3 2015.
Pennypacker added: “Our priority is to continue to improve our quality, make significant market share gains and right-size the business to current demand levels. We will do this without impacting our long-term strategy of margin expansion, growth, innovation and velocity.
“We have significantly cut production levels to match the lower demand and accelerated the transition of crawler crane manufacturing from (Manitowoc,) Wisconsin to Pennsylvania.
“While this will have an adverse impact on our near-term earnings outlook, we expect this action will have a positive impact on our ability to maintain adequate liquidity levels. We remain committed to improving our long-term performance and attaining double-digit operating margins by 2020.”
Overall, Manitowoc’s forecasts that its revenue in 2016 will be down by 25% to 30% year-over-year.