Slide 1: Q1 2024 Earnings Conference Call
Q1 2024 Earnings Conference Call April 26, 2024 EXECUTE • INNOVATE • GROW
Slide 2: Forward Looking Statements
Forward Looking Statements Certain information in this presentation includes forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) and the Private Securities Litigation Reform Act of 1995)
Slide 3: Strong Commitment to Zero Harm Culture and Terex Values
Strong Commitment to Zero Harm Culture and Terex Values Total Recordable Incident Rate (TRIR) 3.4 3.2 3.2 3.0 2.8 2.8 2.6 3.82 3.27 2.98 2.09 1.52 1.77 1.93 1.98 1.90 1.40 2016 2017 2018 2019 2020 2021 2022 2023 2024 Q1 2026 Target TRIR Machinery Manufacturing Average TEREX WAY VALUES... SUPPORT A S
Slide 4: Q1 2024: Strong Start To The Year; Raising 2024 Outlook
Q1 2024: Strong Start To The Year; Raising 2024 Outlook $1.3B $158.3M 12.2% 27.6% $1.60 5% 7% 20 bps 370 bps EPS OUTLOOK RAISING FULL-YEAR TO $6.95 - $7.35 4 Note: Arrows represent year-over-year change
Slide 5: Healthy Customer Demand
Healthy Customer Demand Backlog elevated at $3.1B, >2x historical average Bookings reflect return to more normal seasonality • Improved customer deliveries and lead times have • North America healthy, but Europe remains soft allowed us to reduce backlog from peak levels • Megatrends and replacement
Slide 6: Robust 2024 Market Outlook
Robust 2024 Market Outlook Continued Strength in Infrastructure, Utilities, Manufacturing and Recycling Markets 6 (1) Estimated sales mix by end use
Slide 7: Terex Products Support Diverse End Markets
Terex Products Support Diverse End Markets Leading Portfolio Supports Development Across the Globe Terex products used in diverse industrial and development applications Equipment used in all phases of project life cycle End market demand supported by global megatrends Newly Launched Genie Next Gen
Slide 8: Well-Positioned To Benefit From...
Well-Positioned To Benefit From... Megatrends Government Investment 8 Source: Mckinsey Global Institute; (2) J.P. Morgan; (3) Precedence Research; (4) C&D Recycling Market: Municipal Waste Recycling Market
Slide 9: Strategic Priorities
Strategic Priorities Build on Strong Foundation Accelerate Profitable Growth Execute on operational excellence initiatives Capitalize on megatrends and emerging to enhance both high performing segments technologies Innovate with new products to strengthen Execute organic outgrowth initiatives our ma
Slide 10: Strong Momentum Continues into 2024
Strong Momentum Continues into 2024 USD Millions, except Earnings per Share Q1 2024 Q1 2023 Q1 2024 Financial Call-Outs Inc. / (Exp.) EPS Operating Profit Net Sales $ 1,292.5 $ 1,235.7 Accelerated vesting / severance ($4) ($0.05) % Change vs 2023 4.6% Other Income (Expense) Gross Profit 297.3 278.7
Slide 11: Materials Processing: Consistent Strong Performance
Materials Processing: Consistent Strong Performance Sales Operating Margin Backlog (6.1%) YoY (150) bps YoY (39%) YoY 15.4% 1,162 554 520 13.9% 712 Q1 '23 Q1 '24 Q1 '23 Q1 '24 Q1 '23 Q1 '24 Results Drivers • Lower sales driven primarily by softer demand in Europe, partially offset by growth in aggre
Slide 12: Aerial Work Platforms: Strong Year-over-Year Improvement
Aerial Work Platforms: Strong Year-over-Year Improvement Sales Operating Margin Backlog +12.7% YoY +180 bps YoY (18%) YoY 773 13.9% 2,975 686 12.1% 2,431 Q1 '23 Q1 '24 Q1 '23 Q1 '24 Q1 '23 Q1 '24 Results Drivers • Strong Q1 sales growth driven by higher demand at both Genie and Utilities • Q1 margin
Slide 13: Strong Balance Sheet and Free Cash Flow Generation
Strong Balance Sheet and Free Cash Flow Generation Highlights Significant Capital Return to Shareholders via Buybacks Reaffirming 2024 FCF Outlook of $325 - $375 109 38% Reduction in Shares Outstanding Ample liquidity of $866; Net leverage of 0.5x Over $1.6B in buybacks ROIC of 27.6% on a TTM basis
Slide 14: Raising Full-Year 2024 Outlook
Raising Full-Year 2024 Outlook Previous Updated Previous Outlook Updated Outlook Terex Outlook (1) Outlook Outlook (1) Outlook Operating Operating Net Sales $5,100 - $5,300 $5,200 - $5,400 Net Sales Net Sales Margin Margin Operating Margin 12.8% - 13.1% 12.8% - 13.1% MP $2,200 - $2,300 15.6% - 15.9%
Slide 15: Positioned for Growth to Deliver Long-Term Value
Positioned for Growth to Deliver Long-Term Value Diversified industrial leader well-positioned for profitable growth Excellent portfolio of market-leading business positioned to benefit from megatrends Operating system enables profitability through cycles and high ROIC Strong balance sheet and cash
Slide 16: Appendix
Appendix
Slide 17: Backlog Trend
Backlog Trend 4,149 4,083 4,071 4,137 3,933 3,742 3,331 1,162 3,346 3,411 1,295 1,265 1,174 1,213 3,143 2,957 1,074 767 1,047 890 712 2,408 1,062 2,041 926 714 2,854 2,818 2,897 2,975 2,720 2,668 2,644 2,284 2,456 2,431 1,895 1,327 1,482 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 Mar-23
Slide 18: Q1 Sales by Geography (2024 vs. 2023)
Q1 Sales by Geography (2024 vs. 2023) North America Western Europe Asia-Pacific Rest of World Actual FX-Adj. Actual FX-Adj. Actual FX-Adj. Actual FX-Adj. 16% 16% (10%) (12%) (4%) (3%) (17%) (19%) 8% 9% 11% 12% North America Western Europe Q1 2024 Q1 2023 55% Asia / Pacific 20% 61% Rest of World 24%
Slide 19: Segment Results
Segment Results MATERIALS PROCESSING AERIAL WORK PLATFORMS Q1 '24 Q1 '23 Q1 '24 Q1 '23 Net Sales $520.0 $553.8 Net Sales $772.7 $685.9 % Change vs. '23 (6.1%) % Change vs. '23 12.7% Operating Profit (Loss) $72.1 $85.3 Operating Profit (Loss) $107.3 $83.1 Operating Margin % 13.9% 15.4% Operating Marg
Slide 20: Glossary
Glossary In an effort to provide investors with additional information regarding the Company’s results, Terex refers to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures which management believes provides useful information to investors. These non-GAAP meas
Slide 21: Glossary: Free Cash Flow
Glossary: Free Cash Flow Free Cash Flow - We calculate a non-GAAP measure of free cash flow. We define free cash flow as Net cash provided by (used in) operating activities less Capital expenditures, net of proceeds from sale of capital assets. We believe this measure of free cash flow provides mana
Slide 22: Glossary: Free Cash Flow Continued
Glossary: Free Cash Flow Continued Year Ended December 31, 2024 2020 2021 2022 2023 Outlook Net cash provided by (used in) operating activities $ 225.4 $ 293.4 $ 261.2 $ 459.3 $ 495.0 Increase (decrease) in TFS Assets (40.1) (110.6) — — — Capital expenditures, net of proceeds from sale of capital as
Slide 23: Glossary: Net Leverage
Glossary: Net Leverage Net Leverage is defined as Net Debt divided by last twelve months (LTM) EBITDA. We believe that this measure reflects its ability to cover its net debt obligations with results from core operations. March 31, 2024 Net Debt $ 359.2 Divided by: LTM EBITDA 704.3 Net Leverage 0.5x
Slide 24: Glossary: Debt & Net Debt
Glossary: Debt & Net Debt Debt is calculated using the Condensed Consolidated Balance Sheet amounts for Current portion of long- term debt plus Long-term debt, less current portion plus debt from liabilities held for sale. Net Debt is calculated as Debt less Cash and cash equivalents, including amou
Slide 25: Glossary: EBITDA
Glossary: EBITDA EBITDA is defined as earnings, before interest, other non-operating income (loss), income (loss) attributable to non-controlling interest, taxes, depreciation and amortization. The Company calculates this by subtracting the following items from Net income (loss): (Gain) loss on disp
Slide 26: Glossary: ROIC
Glossary: ROIC ROIC and other Non-GAAP Measures (as calculated below) assist in showing how effectively we utilize capital invested in our operations. ROIC is determined by dividing the sum of NOPAT for each of the previous four quarters by the average of Debt less Cash and cash equivalents plus Sto
Slide 27: Glossary: 2024 ROIC Continued
Glossary: 2024 ROIC Continued Amounts described below are reported in millions of U.S. dollars, except for the effective tax rate. Amounts are as of and for the three months ended for the periods referenced in the tables below. Mar '24 Dec '23 Sep '23 Jun '23 Mar '23 Annualized effective tax rate as
Slide 28: Glossary: 2024 ROIC Continued
Glossary: 2024 ROIC Continued Three Months Ended March 31, 2024 Income (loss) from continuing (Provision for) benefit from operations before income taxes income taxes Income tax rate Reconciliation of annualized effective tax rate: As reported $ 136.5 $ (28.0) 20.5% Effect of Adjustments: Tax relate
Slide 29: Glossary: 2023 ROIC Continued
Glossary: 2023 ROIC Continued Amounts described below are reported in millions of U.S. dollars, except for the Effective Tax Rate. Amounts are as of and for the three months ended for the periods referenced in the tables below. Mar '23 Dec '22 Sep '22 Jun '22 Mar '22 Annualized effective tax rate as
Slide 30: Glossary: 2023 ROIC Continued
Glossary: 2023 ROIC Continued Three Months Ended March 31, 2023 Income (loss) from continuing (Provision for) benefit from operations before income taxes income taxes Income tax rate Reconciliation of annualized effective tax rate: As reported $ 133.2 $ (23.3) 17.5% Effect of Adjustments: Tax relate