Manitowoc Company, Inc.
) gained around 15% a day after reporting upbeat fourth-quarter
2013 results on Jan 30. Adjusted earnings from continuing
operations catapulted 74% year over year to 47 cents per share
aided by sound performance in the Foodservice segment, successful
introduction of new products, as well as Manitowoc's cost control
initiatives. The bottom line beat the Zacks Consensus Estimate of
Manitowoc reached a new 52-week high of $29.39 on Jan 31, up from
its previous high of $26.01.
Including restructuring costs and other items, earnings from
continuing operations were 15 cents per share in the quarter
compared with 26 cents in the year-ago quarter.
Total revenue was $1104 million in the reported quarter, down
2.1% year over year due to increased Foodservice sales, partially
offset by the decline in Crane segment sales. However, revenues
fell short of the Zacks Consensus Estimate of $1116 million.
Cost of sales decreased 4% to $842.7 million in the fourth
quarter from $879 million in the year-ago quarter. Gross profit
improved 5% year over year to $261.6 million. Consequently, gross
margin expanded 160 basis points (bps) to 23.7%.
Engineering, selling and administrative expenses slipped 1.1%
year over year to $151.9 million. Adjusted operating income was
$110.5 million, up 16% year over year, leading to 160-bp
expansion in operating margin to 10%.
Revenues from the Crane and Related Products segment decreased
7.9% year over year to $704.8 million in the reported quarter due
to delayed shipments. The segment's operating income fell 8.8%
year over year to $54.8 million due to lower sales volume,
partially offset by improved operational efficiency.
Foodservice Equipment segment revenues were up 10% year over year
at $399.5 million in the quarter from $363.2 million in the
prior-year quarter. The improvement was mainly backed by
continued growth in the Americas and EMEA regions, as well as
sales from new product rollouts.
The segment's operating income also improved 37.7% year over
year to $68.7 million. The year-over-year increase was driven by
product sales mix and the benefits realized from ongoing
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Backlog in the Crane segment was $574 million at the end of the
fourth quarter of 2013, down $182 million sequentially. Total
orders were $707 million, up 30% from the prior-year quarter,
reflecting improved demand in crawler and tower cranes.
As of Dec 31, 2013, cash and temporary investments amounted to
$56.3 million versus $75.9 million as of Dec 31, 2012. Long-term
debt was $1.5 billion as of Dec 31, 2013, compared with $1.73
billion as of Dec 31, 2012. Debt-to-capitalization ratio was high
at 65.8% as of Dec 31, 2013, though down from 74.8% as of Dec 31,
Cash flow from operating activities was $270.6 million in the
fourth quarter, up from $233.9 million in the prior-year quarter
driven by cash from profitability improvement and a reduction in
working capital requirements in both segments. Capital
expenditure was $38 million compared with $22.7 million in the
Fiscal 2013 Performance
For full-year 2013, Manitowoc reported adjusted EPS of $1.45, up
around 75% from 83 cents in 2012. The results were ahead of the
Zacks Consensus Estimate of $1.25. Including one-time items, EPS
was $1.05 compared with 76 cents in the prior year.
Revenues for the year increased 3.4% year over year to $4.05
billion but missed the Zacks Consensus Estimate of $4.07 billion.
For 2014, Manitowoc expects modest top-line growth for Crane
segment revenues. Foodservice revenues are expected to rise in
mid single digits. The company forecasts high single-digit
improvement in operating margins in the Crane segment and
high-teens gain in the Foodservice segment.
Capital expenditure is expected at $91 million for the year.
Manitowoc also predicts depreciation and amortization of $120
million for 2014. Interest expenses are expected at $100 million.
Manitowoc will be benefited from the execution of new credit
agreement and maintaining financial flexibility. The company
remains focused on directing resources which include cost
reduction and process improvement initiatives, as well as debt
Manitowoc expects margin expansion and modest growth in Cranes in
2014, driven by product introductions; ongoing demand in key
product lines supported by long-term partnership with first-class
distribution network, and continued progress in operational and
Moreover, focus on customers, new technologies and innovation in
brands and manufacturing initiatives will drive growth in the
Foodservice industry. However, general market uncertainties
remain a matter of concern in the near term.
Wisconsin-based Manitowoc is one of the world's leading
innovators and manufacturers of commercial foodservice equipment.
The company is one of the premier innovators and providers of
crawler cranes, tower cranes and mobile cranes for the heavy
construction industry. These are complemented by industry-leading
product support services.
Manitowoc currently retains a Zacks Rank #3 (Hold).
Titan International Inc.
) also belong to the same industry. While Titan International
carries a Zacks Rank #1 (Strong Buy), Terex holds a Zacks Rank #2
) reported a 5% increase in earnings to $1.54 per share for
fourth-quarter 2013 - the only quarter in the fiscal 2013 to
report year-over-year growth. Results outperformed the Zacks
Consensus Estimate of $1.29.