Earnings Review and Free Research Report: Terex Reported Better than Expected Revenue and Earnings Results
Research Desk Line-up: Manitowoc Post Earnings Coverage
LONDON, UK / ACCESSWIRE / August 18, 2017 /Pro-Trader Daily has just published a free post-earnings coverage on Terex Corp. (NYSE: TEX), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=TEX, following the Company's release of its second quarter fiscal 2017 operating results, on August 01, 2017. The machinery products maker improved sales outlook and raised operating income and earnings per share guidance. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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For the quarter ended June 30, 2017, Terex reported net sales of $1.18 billion, down 9% compared to net sales of $1.30 billion in Q2 2016, driven largely by a reduction in sales from the divested construction businesses. Terex's revenue numbers topped analysts' expectations of $1.16 billion
For Q2 2017, Terex reported income from continuing operations of $95.4 million, or $0.98 per share, compared to income from continuing operations of $109.6 million, or $1.00 per share in Q2 2016. Excluding a net after-tax benefit of $47.0 million largely related to the investment in Konecranes shares, the Company's adjusted income from continuing operations for the reported quarter was $49.6 million, or $0.51 per share, compared to income from continuing operations of $60.6 million, or $0.55 per share, in the prior year's same quarter. Terex's earnings topped Wall Street's estimates of $0.42 per share.
During Q2 2017, Terex's AWP segment recorded sales of $593.0 million, approximately flat compared to sales of $593.7 million in Q2 2016. The Company stated that momentum of a stronger-than-forecasted North American market for AWP products continued, driven by growing residential and nonresidential construction demand. AWP's income from operations margins totaled 10.3% compared to 12.2% in the prior year's same quarter. Margins were impacted by competitive global pricing dynamics, higher steel costs and the stronger US dollar, primarily versus the British pound.
AWP's bookings grew 14% and backlog totaled $499 million in Q2 2017, which is up 46% on a y-o-y basis. The segment's Backlog increased for the second quarter in a row in North America, Europe and Asia. Terex is forecasting AWP sales for FY17 to decline approximately 4% with an operating margin of about 8.5%.
For Q2 2017, Terex's Cranes segment net sales totaled $303.8 million compared to net sales of $357.4 million in Q2 2016. The segment turned profitable in the quarter reporting income from operations of $14.5 million compared toloss from operations of $12.8 million in the year ago same quarter attributed to aggressive restructuring actions focused on reducing footprint and cost structure. Globally, Cranes bookings grew 26% and backlog grew 29% on a y-o-y basis. As a result of the progress in the Cranes restructuring program, stabilizing markets and its improved order book, the Company increased full year guidance for the segment.
Terex's Materials Processing sales grew 9.5% to $280.5 million, or approximately 14%, when the impact of foreign exchange is removed. Materials Processing boosted operating profit by $6.4 million, representing a margin expansion of 130 basis points. Growth was driven by its concrete, Fuchs, and crushing and screening businesses. The segment backlog surged 33% on a y-o-y basis, driven by crushing and screening and Fuchs. Terex raised the segment's FY17 guidance to sales growth of approximately 9% with an operating margin of about 11%.
Capital Allocation Strategy
During Q2 2017, Terex monetized $277 million of Konecranes shares for a year-to-date total of $549 million. The Company repaid the $254 million remaining on its 6.5% notes and repurchased 9.4 million Terex's shares for $316 million, bringing its total to 15.9 million shares for $517 million for H1 2017.
Based on Terex's H1 2017 results, backlog and the Company's market assessments, Terex improved its FY17 sales outlook from down about 12% to down approximately 6%. The Company raised its operating margin guidance to approximately 4.75%. Terex increased its earnings range from $0.80 to $0.95 per share to $1.05 to $1.15 per share. The Company reiterated its free cash flow guidance of $0 to $50 million.
On Thursday, August 17, 2017, the stock closed the trading session at $37.71, falling 2.56% from its previous closing price of $38.70. A total volume of 1.26 million shares have exchanged hands. Terex's stock price skyrocketed 18.44% in the last three months, 17.84% in the past six months, and 56.99% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have surged 19.60%. The stock has a dividend yield of 0.85%. At Thursday's closing price, the stock's net capitalization stands at $3.36 billion.
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