Manitowoc performed well in the third quarter despite challenges. It generated significant cash flow, gained market share in all segments, and reported improvements in revenue and earnings. The cash flow enabled the company to reduce debt by more than $16 million more than the required levels.
In response to the uncertain economic environment, Manitowoc has devised a well-defined short-term strategy for moving forward. It will carefully analyze growth opportunities, including acquisitions and new-product efforts will continue. The company also will continue to make adjustments in order to be in a position for rapid growth when the economy turns around.
Third-Quarter Financial Returns
Revenue for the thirs quarter was $301 million, a 40 percent increase more than revenue of $214.5 million in the third quarter 2000. Net income for the quarter was $12.4 million, or 51 cents per diluted share, compared with $12.3 million, or 50 cents per diluted share in the same quarter last year. For the first nine months of 2001, cash flow totaled $85 million, an increase of more than 23 percent compared with cash flow of $69 million for the same period in 2000.
Operations in Review
The crane segment, boosted by Potain’s results, outperformed last year’s third quarter. Revenues rose 75 percent to $152.4 million, and operating earnings increased approximately 51 percent to $19.4 million. Potain’s synergies, which remain on track. Excluding Potain, however, sales and operating earnings were down 4.1 percent and 11.5 percent, respectively, in line with expectations. The economic slow-down continues to negatively affect sales of small-capacity cranes and boom trucks, but Manitowoc is responding to the pressures on those parts of the market. For example, it is consolidating its boom-truck manufacturing facilities, which will reduce costs and working capital while improving manufacturing efficiency.
Large-capacity crane sales, however, remain robust, in large part due to the active power-generation market. The Model 2250 is becoming the workhorse for that market, and the company expects sales of this 300-ton (270 t) capacity crane to increase 15 to 20 percent more than last year’s levels.
On Oct. 22, Manitowoc’s directors declared a common stock cash dividend of 22.5 cents per share, payable on Dec. 7, 2001, to shareholders of record as of Dec. 1, 2001. This latest dividend brings its total dividends paid in 2001 to 30 cents per share.
The company is on track to achieve all of its Mission 2002 objectives. It is responding to the challenges in its crane segment with a stronger focus on managing costs, while at the same time continuing to pursue key growth strategies of innovation, acquisitions, and global expansion. Together, these actions position Manitowoc to take off when the markets recover.
