Terex Corporation · NYSE:TEX
Terex — Q3 2016 Earnings Presentation
32 slides from Terex's earnings presentation, Nov 1, 2016
Slide 1: Q3 2016 Conference Call
Q3 2016 Conference Call November 1, 2016
Slide 2: Forward-Looking Statements & Non-GAAP Measures
Forward-Looking Statements & Non-GAAP Measures This presentation contains forward-looking information regarding future events or the Company’s future financial performance based on the current expectations of Terex Corporation. In addition, when included in this presentation, the words “may,” “expec
Slide 3: Terex Strategy: Focus, Simplify, Execute to Win
Terex Strategy Focus Simplify Execute to Win 3
Slide 4: Focus the Portfolio
Focus the Portfolio Taking Action: • Completed sale of German Compact Construction business • MHPS sale progressing 4
Slide 5: Simplify the Company
Simplify the Company Taking Action: • Streamlined operating structure • Executing footprint rationalization ‒ Cranes (Waverly) ‒ AWP (Scissors, Washington, California, Texas) ‒ MP (Austria) • Reducing cost structure 5
Slide 6: Execute to Win
Execute to Win Strengthen Core Management Processes: • Strategy development and deployment • Commercial and operational execution • Talent management • Drive greater accountability and focus on execution 6
Slide 7: MHPS Sale Update
MHPS Sale Update • Approved by EU(1) and US regulators • Approved by Konecranes shareholders • Expect to close in early 2017, as planned • Benefits of the sale are not included in our current financials • More focused company will drive need to re-size corporate cost structure (1) Conditional upon K
Slide 8: Financial Summary
Financial Summary Results are Continuing Operations, Except Cash Figures • Sales down 16% in the quarter versus prior year • Q3 EPS of $0.31 as reported, $0.19 as adjusted(1) • Net cash provided by operating activities of $106 million, free cash flow(1) of $47 million in the quarter • Repurchased $8
Slide 9: Q3 Operating Results
Q3 Operating Results USD Millions, except Earnings per Share Q3 2016 Q3 2016 Q3 2015 Q3 2015 As Reported As Adjusted(1) As Reported As Adjusted(1) Net Sales $1,056.4 $1,056.4 $1,255.4 $1,255.4 % Change vs 2015 (15.9%) (15.9%) Income (loss) from Operations 39.6 49.0 92.1 106.4 Operating Margin 3.7% 4
Slide 10: 2016 Full Year Outlook - Updated
2016 Full Year Outlook - Updated USD Millions, except Earnings per Share Previous Guidance (1) Updated Guidance (1) Operating Operating Net Sales Profit (Loss) Net Sales Profit (Loss) AWP Down ~ 15% 8.5% - 9.5% Down ~ 13% ~9.5% Cranes Down ~ 15% 1.5% - 2.5% Down ~ 20% ~(2.5%) MP ~ Flat 8.5% - 9.5% n
Slide 11: Aerial Work Platforms
Aerial Work Platforms USD Millions “Celebrating 50 years of innovation and performance with our Customers” Net Bookings Book-to-Bill Ratio $1,000 250% 206% $800 200% 162% $600 150% 100% $400 80% 100% 85% 83% 66% 80% 70% $200 50% 57% $614 $392 $947 $512 $383 $444 $701 $418 $409 $378 $0 0% Q2 '14 Q3 '
Slide 12: Cranes
Cranes USD Millions $500 Net Bookings Book-to-Bill Ratio 120% AT40 $450 103% 99% 100% $400 97% 97% 95% 97% 83% $350 80% 82% $300 74% 67% 60% $250 $200 40% Demag® AC $150 20% $100 $462 $252 $423 $340 $400 $272 $416 $293 $279 $228 $50 0% Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Q3 '15 Q4 '15 Q1 '16 Q2 '16 Q
Slide 13: Materials Processing
Materials Processing USD Millions • Good execution • Concrete market continuing to grow • Crushing & Screening market stable in aggregates, but mining remains weak • Fuchs® material handler volume down Net Bookings Book-to-Bill Ratio 280 140% 130% Q3 '16 Q3 '15 YTD '16 YTD '15 119% 118% 240 120% Net
Slide 14: Summary
Summary Mixed global markets: Focus, Simplify & Execute: • Weakening mobile crane markets • Complete the pending sale of MHPS • Caution prevails in NA rental channel • Manage through the NA replacement – replacement cycle cycle in AWP • Aggregates steady, continued growth • Turnaround the mobile cra
Slide 15: Questions?
Questions? gee
Slide 16: Appendix
Appendix Pere
Slide 17: Backlog Trend
Backlog Trend USD Millions 1,524 1,476 1,406 90 144 Sequential Year on Year 1,320 60 Change Change 193 113 130 156 1,182 1,178 1,160 $ % $ % 150 Q3 74 52 58 153 Q3 149 Q3 944 535 187 Terex (114) (12%) (77) (9%) 512 883 920 71 54 652 42 806 128 Corp & Other (21) (39%) (9) (21%) 139 407 169 33 636 398
Slide 18: Continuing Operations Global Sales
Continuing Operations Global Sales Sales by Geography 2016 vs 2015 Asia/ Western Europe Pacific North America Actual FX-Adj. Actual FX-Adj. Q3 (15)% (12)% Actual FX-Adj. Q3 24% 25% Q3 (18)% (18)% 3% E. Europe, Middle East & Africa Actual FX-Adj. Q3 LATAM (32)% (29)% Actual FX-Adj. Q3 (60)% (60)% 201
Slide 19: Q3 2016 Adjustments
Q3 2016 Adjustments USD Millions, except Earnings per Share Q3 2016 Restructuring Q3 2016 As Reported Deal Related & Related Tax Related As Adjusted Net Sales $ 1,056.4 - - - $ 1,056.4 Income (loss) from Operations 39.6 3.6 5.8 - 49.0 Interest & Other Income (Expense) (25.7) 2.6 - - (23.1) Income (L
Slide 20: Q3 2015 Adjustments
Q3 2015 Adjustments USD Millions, except Earnings per Share Q3 2015 Restructuring Product Q3 2015 As Reported Deal Related & Related Campaign As Adjusted Net Sales $ 1,255.4 - - - $ 1,255.4 Income (loss) from Operations 92.1 - 11.8 2.5 106.4 Interest & Other Income (Expense) (36.2) 8.6 - - (27.6) In
Slide 21: Q3 Adjusted OP by Segment
Q3 Adjusted OP by Segment USD Millions Q3 2016 Q3 2015 As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted AWP $ 48.6 $ 0.4 $ 49.0 $ 78.9 $ - $ 78.9 Cranes (12.1) 1.6 (10.5) 12.1 4.4 16.5 MP 19.5 0.2 19.7 17.6 3.1 20.7 Corporate & Other (16.4) 7.2 (9.2) (16.5) 6.8 (9.7) Continuin
Slide 22: YTD Operating Results
YTD Operating Results USD Millions, except Earnings per Share YTD 2016 YTD 2016 YTD 2015 YTD 2015 As Reported As Adjusted(1) As Reported As Adjusted(1) Net Sales $3,468.4 $3,468.4 $3,854.1 $3,854.1 % Change vs 2015 (10.0%) (10.0%) Income (loss) from Operations 124.3 184.5 266.5 280.8 Operating Margi
Slide 23: YTD 2016 Adjustments
YTD 2016 Adjustments USD Millions, except Earnings per Share YTD 2016 Restructuring YTD 2016 As Reported Deal Related & Related Tax Related As Adjusted Net Sales $ 3,468.4 - - - $ 3,468.4 Income (loss) from Operations 124.3 12.2 48.0 - 184.5 Interest & Other Income (Expense) (86.0) 17.3 - - (68.7) I
Slide 24: YTD 2015 Adjustments
YTD 2015 Adjustments USD Millions, except Earnings per Share YTD 2015 Restructuring Product YTD 2015 As Reported Deal Related & Related Campaign As Adjusted Net Sales $ 3,854.1 - - - $ 3,854.1 Income (loss) from Operations 266.5 - 11.8 2.5 280.8 Interest & Other Income (Expense) (97.5) 8.6 - - (88.9
Slide 25: YTD Adjusted OP by Segment
YTD Adjusted OP by Segment USD Millions YTD 2016 YTD 2015 As Reported Adjustments As Adjusted As Reported Adjustments As Adjusted AWP $ 159.2 $ 7.5 $ 166.7 $ 228.6 $ - $ 228.6 Cranes (41.5) 22.7 (18.8) 35.8 4.4 40.2 MP 63.9 1.3 65.2 54.8 3.1 57.9 Corporate & Other (57.3) 28.7 (28.6) (52.7) 6.8 (45.9
Slide 26: 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 27: Glossary: Free Cash Flow
Glossary: Free Cash Flow USD Millions 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, plus (minus) increases (decreases) in Terex Financial Services (“TFS”) assets, plus (minus) decreases (increases)
Slide 28: Glossary: Debt & Net Debt
Glossary: Debt & Net Debt USD Millions Debt is calculated using the Condensed Consolidated Balance Sheet amounts for Notes payable and 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 ca
Slide 29: Glossary: EBITDA
Glossary: EBITDA USD Millions 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) attribu
Slide 30: Glossary: ROIC
Glossary: ROIC Return on Invested Capital (“ROIC”) continues to be a metric we use to measure our performance. ROIC and Non-GAAP Measures assist in showing how effectively we utilize capital invested in our operations. After-tax ROIC is determined by dividing the sum of NOPAT for each of the previou
Slide 31: Glossary: ROIC Continued
Glossary: ROIC Continued USD Millions See reconciliation of adjusted amounts below on the following ROIC tables. Amounts are as of and for the three months ended for the period referenced in the tables. 31
Slide 32: Glossary: ROIC Continued
Glossary: ROIC Continued USD Millions 32