09 February 2024
Terex AWP, which includes Genie and Terex Utilities, reported a small drop in its fourth quarter sales, but saw its full year buoyed by a 17% overall increase. The company pointed to ‘headwinds’ in Europe, which are forecast to lead to flat sales over the year, but added that markets in North America and India are expected to remain strong.
“We continue to see positive trends in our main end markets, especially in North America and India, but has seen some softening in Europe, which reported a slight sales decline in the fourth quarter,” Terex CEO and President Simon Meester said during an investors call on Feb. 9. “Our Genie products are benefiting from demand from infrastructure projects, data centers, manufacturing and events and entertainment. These megatrends position us very well for 2024 and beyond.”
Fourth quarter net sales at Terex AWP stood at $659.9 million for the fourth quarter, meanwhile operating profit increased 13% to $61 million for the fourth quarter, or 9.2% of net sales, compared to $54 million, or 8.0% of net sales in the previous year.
Adding to that momentum is Genie’s backlog, which amounts to $2.6 billion of Terex Corporation’s total $3.4 billion.
“Our Q4 backlog of $3.4 billion is still significantly above historical levels and is the second highest in recent history, providing healthy momentum going into 2024,” Meester noted. “Our team members continue to successfully navigate supply chain issues last year and worked hard to continue to improve customer on-time deliveries and return to more normal lead times.”
Terex also attributed the increase to higher pricing and cost reduction initiatives, which were partially offset by costs associated with the ramp-up of the new Genie factory in Monterrey, Mexico.
Commenting on the facility, Meester said, “Our new state-of-the-art Monterrey facility continues to ramp up as planned, and it’s the largest facility we’ve ever built in Terex, and we’re very proud of the team of the progress they’ve made. This facility has been mostly built for competitive reasons and to improve Genie’s through cycle margin performance.”
Over the full 2023 financial year sales were up 17.6% at $2.9 billion, $438.1 million year-over-year. Profit from operations increased a significant 89.2% to $371.3 million for the full-year 2023, compared to $196.2 million, as the company said it’s operations became cost/price neutral.
Meester, who has taken over the role following John Garrison’s retirement, said, “After five years in the organisation, I am honoured, humbled and excited to be Terex’s next CEO. Terex is in a very good place, and I look forward to a bright future,”
Meester, formally president of Terex AWP, added, “We are pleased by our strong 2023 performance, and believe Terex is well-positioned to continue to deliver value to its customers and shareholders, with strong demand for its products and favourable megatrends for the long term.
“Spending on manufacturing is up approximately 70% in the last 12-month period, driven by mega projects related to semiconductor manufacturing, clean energy and EV battery projects,” Meester said. “These projects make up two-thirds of the non-residential market. These favorable end market trends, combined with replacement cycle tailwinds and high equipment utilization rates, are very beneficial for our Genie business. Additionally, the increasing adoption of our products in emerging markets, such as India, is another positive.
“As we begin the new year, we again expect to deliver strong results across our diverse product portfolio. We do anticipate some headwinds from European markets as well as lingering, yet slowly improving supply chain disruptions.”
Based on this, Terex AWP forecasts its total revenues for 2014 will be close to that of 2023 at between $2.9 and $3.0 billion.