The Earth King Reports Q3 Results
Terex, the Westport Connecticut based manufacturer with over $4 billion in annual sales, reported Q3 results on October 31. The company reported income from continuing operations of 63 cents a share compared to 31 cents a share in the prior year period. However, adjusted earnings were only 50 cents a share compared with 17 cents a share in the prior year. John Garrison, the company's CEO, said the " financial results demonstrate the accelerating momentum across Terex." Garrison has made some notable changes as CEO since he came on-board in November of 2015.
At that time, the company had 5 segments in its business including Aerial Work Platforms (AWP), Cranes, Material Handing and Ports Solutions (MHPS), Construction and Material Processing (MP). Originally, it seemed like it could be a short tenure as CEO for Garrison when Zoomlion, a Chinese company, brashly announced an acquisition of the company for $30 a share. Terex had another suitor at the time, Konecranes who was left in the dark. Later in the year, Zoomlion soured on the deal and Terex sold its MHPS business to Konecranes for $820 M of cash and 19.6 M Konecranes shares, which Terex has been monetizing ever since. Garrison has also sold off the company's almost never profitable construction segment. In the current quarter Terex monetized the remaining shares in Konecranes, which resulted in total compensation of $1.6 B—KoneCranes and Terex's stock are up similar amounts since the proposed acquisition at 87% and 77% respectively.
Terex's CEO also increased EPS guidance for the year to $1.2 to $1.3 a share. However, 5 cents of this improvement is from a lower tax rate and share count. The company now has 3 segments: AWP reported operating profit of $57.5 M on revenue of 557 M. Cranes reported operating profit of -1.3M on $302 M of sales and MP reported operating profit of $28.4M on $259.9 M of sales. The company’s backlog exploded higher compared to the prior year with growth of 44%. The company updated its guidance for sales: AWP sales are now expected to be up 2% on the year. The company said it would update investors on 2018 guidance in February.