Rental Demand for Aerial Paces Terex’s Growth in 2013

Terex Corp. posted net sales of $7.1 billion for the full year 2013, compared to $7 billion in 2012, a 1.4 percent increase. Income from continuing operations, however, was a more substantial increase, from $179.5 million in 2012 to $261.2 million in 2013, a 45.5-percent hike.

For the fourth quarter, income from continuing operations was $84.8 million on net sales of $1.8 billion, compared to a loss of $33.2 million on net sales of $1.6 billion for the fourth quarter of 2012.

“Overall, 2013 was a good year and I am pleased with the improvements and progress underway at Terex,” said Ron DeFeo, Terex chairman and CEO. “This past year was a tale of two halves, with the second half of the year significantly stronger than the first half. Our performance in the second half was fueled by the continued strength of our Aerial Work Platform segment and a turnaround in our Materials Handling & Port Solutions segment. Our focus throughout the year on strengthening margins and driving financial efficiency helped deliver a strong close to the year.”

DeFeo added that the AWP segment benefited from strong North American rental channel demand plus a noticeable pickup in performance in Latin America and Europe.

“Additionally, the Materials Processing segment performance remains solid, delivering double-digit operating margin in 2013 despite a relatively soft demand environment” DeFeo said. “These business segments performed well in 2013 and we expect even better performance in 2014. The remaining three segments did not meet our expectations in 2013. However, we have made good progress with the integration of our MHPS segment and we expect continued progress in 2014. The pending sale of our off-highway truck business results in a smaller and more focused Construction portfolio. We have confidence we can improve the financial profile of this segment going forward. Lastly, our Cranes segment failed to realize the growth that we had anticipated entered 2013. While new product launches did provide some growth, markets such as Australia, Europe and Latin America were more challenging than anticipated.

“During 2013, we made investments and implemented actions to set us on a course toward increased profitability in 2014 and beyond. We enter 2014 with optimism around our businesses and expectations to deliver improved financial results. Much of this optimism stems from our continued focus on internal areas of improvement, such as our capital structure initiatives and business simplification, as well as the year-over-year benefits anticipated from the restructuring efforts undertaken in 2013.”

Terex officials said they expect 2014 net sales of between $7.3 and $7.7 billion, with earnings per share between $2.50 and $2.80.

“Our 2014 guidance reflects the benefits of internal cost initiatives, capital structure improvements and some anticipated net sales growth,” DeFeo added. “The guidance is for continuing operations, and as such excludes the earnings associated with the off-highway truck business due to its impending sale. We see some signs of improvements in many parts of the world although this is tempered with some continued market uncertainty, particularly in developing markets. Overall, we believe that the global economy will be stronger in 2014, but still modest when viewed against historic demand levels.”

Terex is based in Westport, Conn.

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