MNTX - Earnings call transcript Q4 2019 | Manitex International, Inc.

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Operator

Good day and welcome to the Manitex International Fourth Quarter and Full Year 2019 Results Conference Call. Today's conference is being recorded.

At this time, I'd like to turn the call over to Steve Filipov, Chief Executive Officer of Manitex International. Please go ahead.

Steve Filipov

Thank you, Matt. gentlemen, you and in your ladies International. Manitex afternoon, and for thank interest Good

Yu, don't well voice today Kiefer, of Chief recognize just who of have is those For my Steve the I'm call as call at My and Officer; CFO. our CEO led Operating with Steve here we Filipov. the International Senior yet, and I've on the VP team our behalf and Laura President the Manitex Manitex. as name on second is it me

Please instructions see XXXX. will until for our website or XX, our be for release replay March which this call, available

further Now, please risk factors on with We statement statement. review the our refer harbor associated this Company. slide for to and also our our guidance safe that to you regarding many ask refer X filings SEC

I a will after financial will summary, from present we by Laura welcome the overview, Steve, operating questions. commentary which begin followed brief with

everyone strong about we've X. coming the Please are few years. now the XXXX. global slide proud fourth journey to And over in team turn going very I'm I a remind of before our where longer profitably XXXX over quarter Manitex delivering months. the our results, place to want term But QX priorities at in been I past putting we deeper to grow Manitex for of good feel on the

And we of customers deliver Innovation is to need, business. ahead to of the the need order our keep our utmost importance innovations of that in in for the competition. functionality our sustainability

to cranes, straight week aerials our boom mast knuckle to our heading We CONEXPO new this demo customers. are and industrial cranes cranes, to

including X-section mount with better access indoor a rotability, The display new Valla new a the to access with application, will the remote emission truck several new new and with line, cranes control a segment. compact a XX-ton of X-ton our crane, products for boom lift tractor boom, and be XX-ton a applications. higher and new full wallboard truck counterweight boom new XX-ton industrial Some zero boom capacity line a removable for MAC on product to truck form of

Now, shareholders. our of objectives and some me high for the our Company let outline level

run to maintaining we keen working cash capital eye generation This First, and production. business our profitability. maximize this and future a management will efficiency in requires on

overall indicates throughput While sheet particularly to on quarter opportunities our us by in end down improve there million additional our of still the working facilities. believe our some to balance of our QX, in ahead the inventory, at $X we inventory are reduce further improvements,

our Second, continue pay we strengthen will to down debt. balance sheet and

year, this. with We debt, down have the ended end quarter $XX.X shown of $X.X we the year XXXX. could of fourth million last in we in from do net And million the

for EBITDA product divestiture of being Manitex share enhance our shareholder I increase want transaction International. our to strategic As Sabre of determined in team. Sabre focus term everyone on with thank our longer that earnings of Manitex and our This our margin to review will be XXXX. us the part and a adjusted of businesses, accretive to aligns core, higher per we portfolio, vision at will for part the value, allow

I knuckleboom have dealers. namely time growth our relatively our is amount in PM ourselves primary crane for significant new, the a And focused PM facilities of suppliers, to player largest we and with in opportunity key mission the in is continue here a process and my on market tenure my partners, and Company, as improvement. team new. spend While establishing our not

to in invest if grow, I'm want a firm team. believer to that have you the you

QX. started parts happens to started on we just and benefits in but our additional an overnight and support quality, already investing in journey, have we're production, we have Nothing service. see So, the

with Peru. up were our in and starting EBITDA, to France, global Chile, QX gain revenues branding strategy like which fact Mexico traction in Italy, close the is starting versus XX% to that a to attests and sales QX to XX% increase PM's markets

in we started ramp as build to launch distribution dividends our network Texas and America our North MAC out in Georgetown, pay up Our facility. assembly

significantly have focus its Tadano. in with And overall our We given our strategy, comments a have more moment. importance I will increased on detailed

for military contract in of award the second announced quarter the will We products, crane of start articulating a last delivery year XXXX. which

production provide a assembling XXXX. are our further Texas Georgetown, we at We of for as team good these will into and pace head

only more make our much have margins, the to grow delivering our highest we're We with but opportunity uptime services not sure our to for businesses and parts products.

of that We aerials, the we gross in opportunity business oil about PM close past, talking am spent a is and part margin steel continued of and which the part the nice in and our have acquisition. business and it team there of sales time that for we on enjoy we much parts see I to is margin XX% communicated indeed important haven't pickup. consistently our an proud but

already in we an in have aggressive business, seeing the grow place to U.S. put We markets France, plan like growth are significant this in and Spain and

not up as effort, Valla zero-emission result to least, cranes. we a is of translate XX% this and increased revenues XXXX. this see in to Last industrial have backlog we Our expect but our

with very much has our is for a mention opportunity transportation, us rail, XX put a In few. past an confident and have Valla years, and specialized petrochem in and over business. into place industrial XX,XXX customer leadership presents expand to to diversify distribution, the network. market mining to can produced I'm new this aviation, cranes, and more This do We we

Please turn to X. slide

I crane more We expand call, But to needed have group. many we the Tadano with have spent starting team our told place, in we Singapore PM-Tadano and this Tadano's put aggressive articulated to of plan to crane get leadership you the partners benefits. and are as place business. in a I time in the Japan personally the in with to on industry strongest plan in see the also

objectives. to grow place and meets our a in deliverables where strong on basis now on PM-Tadano support We need business. where and operational This report are put have monthly they they to team out a with clear team

We have distributors see new conducted starting more Asia in training orders sessions to and for come our in. many

opened dealers to has East. door in the Middle the Tadano also

We in though, working delivery together closer will closer XXXX. Most have our see take and much teams purchased impressed building early much Manitex a importantly Tadano first to I'm relationship. units the and and

in thousand opportunity We business a much will close hundred year last more in go few million down and $X the to from road. to XXXX, dollars

to Laura? me let over detail. Laura Now, to it these in more turn financials discuss

Laura Yu

you call morning. the Thanks, Thank today. good Steve, for joining and

update results. X. Let me and operating direct your attention and financial to slides X QX

to quarter Valla, for was million, XXXX. PM X.X% $XX.X primarily offset up to Manitex up quarter compared higher third the decline & compared softness machinery quarter approximately revenues were by the America of XX% in with North Crane had by third partially in due quarter sales strong market fourth cranes. XXXX. at revenue Our driven for straight sales to mast a the the PM The increase

by total the counted companywide declined XXXX. fourth for to marked euro by decline the X% revenue the XX% impact revenue Part due U.S. unfavorable the to of XX% quarter quarter compared an dollar. Total weaker currency in revenue This against was a of decrease. the also

from X.X X.XX, the an Our the was improvement third book from bill to quarter the ratio XXXX. quarter for

the remained PM order This year-over-year. at or in to million at increased approximately increase over backlog XX% an $X Our straight the U.S. year-over-year flat Backlog offset mast at was in $XX.X decline year-end. million crane

As million, total backlog $XX from XXst, increase sequentially of to year-end. February the improved X% a

pulls was This gross third higher Adjusted margin offset XXXX. declined to revenue. our sales gross revenue by compared primarily Manitex XX% a higher from margin sales was non-incurring to improvement XXXX, XX.X%. partially below than XX by margin basis was the unfavorable was was the quarter quarter XX.X%, and Higher value-add out and lower quarter the was PM, This margin up from charges primarily XXX and mix. due the both third adjusted range, basis margins objective. pass-through which result fourth Adjusted of XXXX points the which driven points

gross first adjusted XXXX, to production trend schedule we for to quarter the at the expect Looking XX%. value-add margin

$X.X XXXX, $X.XX driven Our per improved or compared million income million, third higher adjusted share. primarily million gross earnings Adjusted margin. fourth XXXX $X.X to the was EBITDA quarter quarter was $X.X by net

excluding third quarter. quarter expense, the charges SG&A for to Adjusted the compared decreased slightly non-recurring

our as teens. take As to is take necessary the of in will the time, percentage long-term said, This low sales a steps. will continue we target we SG&A some but

to to slide compared year million Turning and execution the volatile in demand was industrial operating full XXXX. of results. the North to year. value-add the by equipment particularly compared in revenue prices gross of Full year the Adjusted extremely to X.X% rising effective a XX.X%, seven, the This lower cause component headwind despite market, result the in America team, was slightly $XXX.X year. margin was prior down

income share, $X.XX XXXX $XX.X XXXX. compared compared $X driven The $X.X or margin year decrease share million, per or to was down million Full to EBITDA $X.XX million adjusted $X primarily revenue. year lower from decreased XXXX. Full net per down from million by was XXXX adjusted was

week Let's Directors on full the approved Board adjusted and fourth year has operating Sabre move quarter Sabre. announced the We of to X. that slide impact the results. last of divestiture

Sabre report. with We that quarter will quarters year as XXXX our bottom-line for for in Company's material results was X% any believes for the not XXXX the expect sale going Full and will the first We divestiture approximately beginning charges held from total report divestiture. financial revenue to improve Management classify operating Sabre future stability forward. of revenue. do

points to Sabre, for would improved the by per Excluding Full earnings per have earnings XXX fourth and XXX have basis share, XXXX Adjusted Without improved share to the XXXX to by fourth $X.XX share quarter. basis XX.X%. would for would up Sabre, for would by net improved Sabre. results to $X.X points million have per value-add margin $X.XX full income the compared have $X.XX. improved year the year year to share $X.XX quarter, without for from per for full adjusted gross by XX.X%

slide to We have since nine, level by a principal Moving $X $XX.X million a at debt to XXXX. This by term provides debt of debt lowest year-end. million year-over-year at net reduced million Italian net net We debt QX year-end, made the breakout on XXXX. payment $X.X quarter. slide update the we seen the

consent start payments the on In a principal Notes. made making Perella to addition with decision noteholders, early the the convertible management from

continue year making payment million throughout first principal year. made was The the early payments plan this the our to on maturity before It $X date. Xrd is February of

improve balance debt is reduction. Our goal sheet with to the

decrease take call, the on put we will to improve delivered our have to the team cash cycle. accounts and effectively a to receivable. working together Management focus capital million necessary improve accounts to to Company's million in a managing net fourth conversion we that especially $X At the strong our that inventory continue announce in results management, inventory working quarter will last receivable earnings reductions costs, the other working and with $X capital debt. and reduction by control mentioned actions I'm reduce pleased inventory further performance,

turn Kiefer. now the Steve I'll that, to With call

Steve Kiefer

Please to new share for XXXX various business prior in The year, a notwithstanding business, a significant pursued as improvements, year XXXX the new allowed and product end Manitex for operations mast XX. important number end we development backlog of our commercial slide market strengthened straight with a the industry-leading introduced initiatives Manitex to strong uncertainty throughout of we've the was and us our many maintained crane turn PM flat markets. developments, year, products. versus

the distribution focus at a Bauma and enter and April as offerings XXXX. PM of backlog product Show XXXX introduced to year began as was in and number moved products throughout adding Manitex and we We year. and throughout our Trade revenue a new of key we products those last the Strengthening

order production September in began million knuckleboom $X.X of quarter second of year, announced an in we PM and cranes. of from a military XXXX. late will last begin for XXXX We customer these international shipments cranes the In

we additional as additional We PM announcing are and orders military pursuing move throughout anticipate cranes XXXX. for contract awards

XXXX a X%, North we dealers customer general three conditions. These Group declined knuckleboom PM and drove products straight in in our to year cranes while our quarter new added shipments reflecting backlog increase versus XX% crane backlog efforts of Additionally, America. the mast end Manitex began in last the our of fourth PM Manitex-branded our market

With and we second filled the book-to-bill of our fourth for booking first many the year of some quarter quarter slots XXXX late quarter. last ratio began X.XX, slots

level Going remain increased in our sales end markets. while that we activity noted channel our stable, checks at an rental some forward, indicate and have consciousness of dealers of our

the coronavirus line continue Additionally, we continue to stoppages no with monitor associated to-date. factories developments operating with our experienced and well

to long-term while Overall, suppliers the contribute we new CONEXPO look to commercial key announcing each improvement, are of shareholder products product our new media. focus will reduction of with development, also this our confident meeting from initiatives and core week, debt customer businesses, We innovation, number Trade value-creation. forward and trade and operational market of a Show customers,

your for to Steve turn back today. And you now Thank it I will time Filipov.

Steve Filipov

Thank you, Steve.

XX. slide to turn Please

The themselves. focused, But, strategy very PM. now starting is one dedicated get first leadership happening phase our for team some because earlier turnaround are a of PM of to speak at person, not engaged but at we have because numbers the traction, the and of and we mentioned results

We put around into have the of improved to products. which delivery our been established for also and process more specific track business our some deliverables, and quality, XXXX progress cost have

in growth manufacturer the cranes, in next journey and and confident the as but beginning for only We're aerials, see hope our portfolio is can competence are articulated focus this our Manitex. improving opportunity I you core why a we PM industrial of and the potential on of the cranes,

I'm slide front great customers, turn us. of leadership foundation opportunity built products, we of in loyal and XX. Please about to investors Manitex In a have global excited an International's the excellent team. committed solid summary, brands,

is market, to continuing Our are innovate in with holding for Manitex stable. North business we our and products a our And services in customers. ground challenging new America

our our a growth growth is will global we shareholders. in The business this us become and more rough, engine forward. delivering our to will be will going PM the diamond higher Our allow company, to returns -- -- growth

any company, and and both reduce an As material costs. our have in costs, SG&A to opportunity we

material of focus costs reducing over in over a next costs delivering will stable and want years. also We on SG&A low We XXXX. our XX% the target be and over solid business, to EBITDA, teens our consistently few being

I on Lastly, coronavirus want the comment to situation.

further the by a team not in and We and our have have until We're our of being and decision Italy limited virus notice. affected from for working still team made Italy we of and taken precautionary team facilities. to at are not aware measures travel the CONEXPO, travel time, to in the for this any

have not any line continuing. production stop had is We far so and

situation And the have We the assess team we'll as to members daily of top the it at safety of the standup list. meetings our evolves. keep

and the floor any Matt, questions. let's go ahead for open

Operator

Capital will first Partners. [Operator Instructions] you. Clare come question Thank Justin Our from Roth with

Justin Clare

then, So, growth I into sales first, was Is or about if what due business XXXX? you primarily increased you'd demand I wondering I to expansion on you your into increasing heading guess could in if seeing also you what's markets speak business. driving Do new more comment established markets? the in expect here, XXXX? see And was you in are this wondering the to PM grow

Steve Filipov

Justin. Sure,

So, say, yes, really I would our is twofold. growth

the business globally. is growing a market of crane First all, knuckleboom

competitors, growing. you If also our look at they're

there. So, we're that's market growth from the benefiting

lot are I more up more in a Latin focused we piece Chile France, think, also where we're that’s first in got we're In think put call. equation second some some Argentina, picking picking share we selling there. that mentioned a gaining America, the share We've there. good markets -- We're and there. France share we in is, of in. focus increased a our business I have dealer have in the Italy, And just good we on there. I more then, in because up in business we more product also our

leader on you where growing it's now, focused Right is we're other really crane again, our not those a knuckleboom too when markets. And in be twofold. to we it bad compare markets. can So market share

Justin Clare

then trending, for XXXX? then, you Can QX, Manitex shifting as speak of those those were your move we into in share to margins. much business And for how great. margins see each your businesses relative PM Okay, margins you higher how to to and

Steve Filipov

Yes, sure.

Laura? answer the question. Laura I'm to So, going let

Laura Yu

Yes.

the Manitex for margin the low-XXs. higher So, the PM in be locations, at is QX, typically moving And U.S. forward than level for the to for margin we in gross gross PM. same expect

Justin Clare

shortages. here, if wondering become not concerns great. what have But you about one could Okay, seeing near materials components was could last then, talk the currently an the think like just you issue any It here. or if wondering term about you're any chain. in you're one sounds that you supply just And seeing. wondering I

Steve Filipov

Yes. Thanks, have that China We haven't now, right Justin. U.S., from shortages any but to seen the yet. really Look, some components do haven't had we we shipped shortages? any get

But now, inventory just there's, the pipeline Right But, the up. still haven't that QX stops. to of situation. seen any right? hard, through Justin. line the uncertainty, said, at shipping from change we're we're plan don't we've producing It's an think, more for we getting feeling now, cranes off may We're includes I that our there's drop just if But that the cranes. in that I example perspective. lot our still perspective. that calls least line weekends, had haven't any right that in from daily into got a still As Italy, team; parts assess We're things with confident facilities. as and

Justin Clare

pass Okay, thanks. I'll it on.

Steve Filipov

Thanks.

Justin.

Operator

will we Next, Mike hear & Company. Dougherty Shlisky Instructions] [Operator with from

Mike Shlisky

here you in some was trends or prices to or coronavirus of the are little market due quarter. itself that oil is right bit us end items, caution had in caution cautious first that give the the now? that tone market sense you the construction there Can are a the driving So, other mentioned

Steve Filipov

the Mike. that I part of didn't get question, first

product? the the costing asking of You're

Steve Kiefer

Cautiousness.

Steve Filipov

Oh! Cautiousness…

Mike Shlisky

No.

the some there here mentioned amongst construction market to in end your due the more et part in might coronavirus to caution be think was that You conditions year the cetera? of or of or customers some oil due first you

Steve Filipov

Yes.

of our end parts. about crane said judge At on Let's focus still what The as and knuckleboom message I our that two doing to is we it what about talk Manitex globally. day, is, fairly comment we've Mike, Manitex. it’s going for got and So, Steve But, the have. control. really well, I impact the basically hard the let's is, coronavirus market can our the have And that's let investors Right? to team it's before, operations. take to in PM. what I'll

the a think, we've good I have other is, got opportunity backlog. we

As of grew XX%. we came by example as our into PM, we backlog XXXX, an

QX for good that's So, QX. and

cancellations. We haven't any seen order

really seen haven't backing product -- anybody product. taking We so off

that So, on to side, be the on And right market, have straight boom Manitex comment hand, ship to now, the market. according still them the we're feel able that orders then, on plan. the the to about pretty confident going maybe Steve, we

Steve Kiefer

Sure.

well and have performing high that dealers been know, Mike, in in a America. are the to be a amongst As Energy certainly has their energy concern construction you continues prices concentration North market.

Mike, diversified years, significantly And our you know, or -- As last total about revenues, XX% we've Sabre. over the is mix. including energy end our of market year currently was

remains energy something component is our while important us, so, that And to much it's business. smaller a of

really the cautiousness in the a that but the four year the began we as of the four a Mike, every at with year? some with, and result this election year with U.S. years, cautiousness associated an We And more is years experience time, year know, began what you of coronavirus see as election we, this that every is occurs concern, really

Mike Shlisky

as wanted inventories I on a it's flat it year-over-year. are in dollars, well. also touch see I to flat Backlogs year-over-year.

do might or the side bit some still here? place you're There inventory and little guess, correct to be in in like the is inventories I balance between So, is, question on off? PM feel my had changes you be there the Manitex

Steve Filipov

opportunity. still an Inventory, we got

has is at nice around we at QX, And last, say we is our half got think backlog. it. inventory. good we're company, did team on But, inventory right orders mean, did really million good still -- put we think opportunity opportunity. a QX the of still job now in of goods I but said think, I $XX $XX has reduce. good team job that I'd PM. I have a about before, And Manitex, opportunity. about getting We have as down. because we that I finished the of feel about PM a we focus about million to the

cash part our generation we inventory. as plan got is our XXXX to to of that continue So, reduce

an presents us. opportunity still it So, for

Mike Shlisky

that whatever I of had years, think, inventory your gone products that -- this Is point, and the of of obsolescence here? couple or quarter I effort almost worked as been older recall. to over some be the now in through kind last at quarters just were it, few inventory that after couple inventories, there's last problem of

Steve Filipov

Yes.

think, Mike, we... was there But, think, Laura, we that, So, most I we of I’d -- think that I but a in think says, inventory. of essentially, I we’re there I one -- a QX, had write-down was is through what some product

Laura Yu

We Yes. AML policy products of some also the reserve. then the and on reserve [ph] we a procedure put took on discontinued a

So, adjustment see the big reserve. we to will AML going forward, a

Mike Shlisky

step on think big or at Okay. here? question so. I on there I net as Honestly, it X. I low you debt take I wanted debt? you [Ph] you you my and there debt been the to net like -- seems Do is, there's where touch well. guess, are said need further think a feel is next good do the you a to down think

Steve Filipov

debt you're broke question, It saying, little at our is level, the bit. up The a net right Mike?

Mike Shlisky

just take your you from roughly to I there? net or mean, that, if towards overall so steps kind be out get of think that's if at you, I cash the to X.X was times or Sabre, Sabre next for available what's you of taking you if And put will net curious, I the debt any you're EBITDA. Yes. debt

Steve Filipov

Yes. Sure.

take in we're the at January due we going another of converts, yes, So, piece our there as due this said to of of is piece end is right? before, that that’s 'XX. There's out year;

we Notes. on we $X As million February prepared paid in Perella said remarks, in our down the

funds the we're And piece we come work answers going Sabre the then, essentially we'll two that? your we to close but need down if those we to continue when that that if and pay avenues use is, do to down, capital, sell used working going second debt, we when at feel that with be question. So, for the transaction. are or it, that's Sabre what the with do to look Yes, that we

Mike Shlisky

about me last for And one Tadano. Okay. one then,

you're put meetings mentioned more well have that today? could just little stand bit where outperforms on what far. and And then, You regular Tadano more highlight But, you is it as about working just been have is a your going detail so you going going on where color forward doing, out exactly what's challenge could There to been forward? there. what it's you

Steve Filipov

mean, a my said I Asia. just was strong the in But, trading of come lot focused what lack think, has for very direction. driving team presents we put first there's I'll on good that Middle in because put have but I opening dealer. as that the the I in a for we comments, Tadano is a But, of tend places priority dealers. plan And -- East to really And us I'll to -- in the Tadano Asia Yes, mentioned Sure. is I moment. business. opportunity really a

parts Number to think through sure some product inventory I the to product that. two product. trading three right? the We for got So, else get ground on that parts can those support is that and program got Number a dealers shifted is selling. we've and the we've done making it so that one they're and into service, is of to some number the dealers we've Singapore, market than that we stocking because sure much different make is we've to which need anything

process see there. different business crane time, Mike, really Like things, much it those is get takes fundamental But, said, those continue of foundational to sales it's a done, example. or than doing. selling once as things of what And I we're think, training an I all kind terrain all an right? we'll So,

just that's it team there's spent feel happen. the time relationship got very lot very I closer that and team But, much we've needs to Tadano of PM-Tadano good those now. focused really working I with education both So and focused the a teams our about on and team of together. that’s thorough on good

Saudi. is the there. good representation couple up other some has looking into sold opened we're markets Tadano said, a at a We bit. I And of Middle as And East where products now

we much question. the to answers can. that that the do way as going we sure PM-Tadano forward. in we product will as But, So, expand support want your Hopefully, that we it I branding, a make can

Mike Shlisky

it. I’ll you. I That’s great. Yes. appreciate along. Thank it pass

Steve Filipov

Mike. Thank you,

Operator

queue, more or Filipov questions over Steve in with no additional closing the any remarks. turn call for the And to like I'd back to

Steve Filipov

And thank investment everyone good you support Thank your forward XXXX. and you, appreciate early Matt. for another on Manitex. in in your quarter, look to and for We your time reporting

to see all very you thank CONEXPO. your we'll Thank appreciate time. much. you. hopefully I So, you And at

Operator

Once again, that your does participation. conclude you today. our call Thank for for

may disconnect. now You

Manitex International (MNTX) 9 Mar 202019 Q4 Earnings call transcript