The Manitowoc Company Reports Second-Quarter 2024 Financial Results; Updates Full-Year 2024 Guidance

Rhea-AI Summary

The Manitowoc Company (NYSE: MTW) reported second-quarter 2024 financial results with net sales of $562.1 million, down 6.8% year-over-year. Adjusted EBITDA was $36.0 million, a 40.4% decrease from the prior year. The company faced operational issues and sluggish order intake, particularly in Europe and North America. As a result, Manitowoc has updated its full-year 2024 guidance, lowering expectations for net sales, adjusted EBITDA, and adjusted diluted earnings per share.

Key highlights include:

• Net income of $1.6 million, or $0.04 per diluted share
• Adjusted net income of $8.8 million, or $0.25 per diluted share
• Orders decreased by 22.2% to $428.4 million
• Backlog at the end of Q2 was $836.3 million

The company remains focused on its CRANES+50 strategy and The Manitowoc Way to drive long-term shareholder value.

Positive

• Non-new machine sales have grown 34%, expanding higher margin, recurring revenue streams
• Focus on inventory reductions to generate free cash flow
• Continued implementation of CRANES+50 strategy for long-term growth

Negative

• Net sales decreased 6.8% year-over-year to $562.1 million
• Adjusted EBITDA decreased 40.4% to $36.0 million
• Orders decreased 22.2% from the prior year
• Lowered full-year 2024 guidance for net sales, adjusted EBITDA, and adjusted EPS
• Operational issues led to lower-than-anticipated results
• Weak demand expected to continue in the second half of the year

Insights

Financial Analyst

Manitowoc's Q2 2024 results reveal significant challenges. Net sales decreased by 6.8% year-over-year to $562.1 million, with adjusted EBITDA falling 40.4% to $36 million. The 22.2% drop in orders to $428.4 million is concerning, indicating weakening demand. The company's revised guidance, lowering expectations across key metrics, suggests a challenging outlook.

The reduction in full-year net sales guidance from $2.275-$2.375 billion to $2.175-$2.225 billion and adjusted EBITDA from $150-$180 million to $125-$140 million reflects a significant downturn. This, coupled with the lowered EPS guidance, points to potential margin pressure and profitability concerns in the near term.

Market Research Analyst

The crane market is facing headwinds, particularly in Europe and North America. Key factors impacting demand include:

• Uncertainty surrounding the upcoming U.S. election
• Persistent high interest rate environment
• Operational issues within Manitowoc
• Continued challenges in the European Tower Crane business

These factors are causing customers to delay new crane purchases. The company's focus on inventory reduction and adjusted build schedules suggests a defensive strategy to navigate the anticipated weaker demand. The 34% growth in non-new machine sales through the CRANES+50 initiative is a positive sign, potentially offering some resilience through higher-margin, recurring revenue streams.

Industrial Equipment Specialist

Manitowoc's performance reflects broader industry trends in the crane sector. The 6.8% decrease in net sales and 22.2% drop in orders indicate a significant slowdown in demand for new equipment. However, the company's CRANES+50 initiative, focusing on aftermarket services and non-new machine sales, shows promise in diversifying revenue streams.

The $836.3 million backlog, while substantial, may be at risk if order cancellations increase due to economic uncertainties. Manitowoc's strategy to adjust build schedules and reduce inventory is prudent, potentially improving cash flow but at the cost of near-term growth. The focus on The Manitowoc Way for continuous improvement could help mitigate some operational challenges, but the overall market conditions remain challenging for equipment manufacturers.

Second-Quarter 2024 Highlights

• Net sales of $562.1 million, down 6.8% year-over-year
• Adjusted EBITDA⁽¹⁾ of $36.0 million, margin percentage of 6.4%
• Adjusted return on invested capital⁽¹⁾ of 7.1%

MILWAUKEE--(BUSINESS WIRE)-- The Manitowoc Company, Inc. (NYSE: MTW) (the “Company” or “Manitowoc”) today reported second-quarter net income of $1.6 million, or $0.04 per diluted share. Second-quarter adjusted net income⁽¹⁾ was $8.8 million, or $0.25 per diluted share.

Net sales in the second quarter decreased 6.8% year-over-year to $562.1 million and were unfavorably impacted by $2.7 million from changes in foreign currency exchange rates. Second quarter adjusted EBITDA⁽¹⁾ was $36.0 million, a decrease of $24.4 million or 40.4% from the prior year.

Orders in the second quarter were $428.4 million, a 22.2% decrease from the prior year, resulting in backlog at the end of the second quarter of $836.3 million. Orders were unfavorably impacted by $2.0 million from changes in foreign currency exchange rates.

“During the second quarter, we faced a variety of operational issues which led to lower-than-anticipated results. In addition, the Tower Crane business in Europe remained a headwind to our results. Order intake was sluggish for mobile cranes in Europe and North America. Mobile customers have been slow to commit to new cranes in the face of the uncertainties associated with the upcoming U.S. election and the continued higher interest rate environment. Looking at the balance of the year, we expect weaker demand to continue. As a result, and with a focus on inventory reductions to generate free cash flow, we took actions to adjust our build schedules in the second half. We have updated our full year guidance accordingly,” commented Aaron H. Ravenscroft, President and Chief Executive Officer of The Manitowoc Company, Inc.

“CRANES+50 is the driving force in our transformation as a stand-alone crane company. Since its launch, our non-new machine sales have grown 34%, expanding our higher margin, recurring revenue streams. We remain focused on continuous improvement through The Manitowoc Way and growing our aftermarket through CRANES+50 to drive long-term shareholder value,” added Ravenscroft.

Updated Full-Year 2024 Guidance

Manitowoc is updating its full-year 2024 guidance as follows:

Net sales – $2.175 billion to $2.225 billion (previously $2.275 billion to $2.375 billion)

Adjusted EBITDA – $125 million to $140 million (previously $150 million to $180 million)

Depreciation and amortization - $60 million to $63 million (previously $63 million to $67 million)

Interest expense - $36 million to $38 million (previously $32 million to $34 million)

Provision for income taxes - $9 million to $13 million (previously $18 million to $22 million)

Adjusted diluted earnings per share - $0.45 to $0.90 (previously $0.95 to $1.55)

Capital expenditures - $60 million of which approximately $25 million is for the rental fleet

Free cash flows - $30 million to $50 million (previously $30 million to $60 million)

Investor Conference Call

The Manitowoc Company will host a conference call for security analysts and institutional investors to discuss its second-quarter 2024 earnings results on Thursday, August 8, 2024, at 10:00 a.m. ET (9:00 a.m. CT). A live audio webcast of the call, along with the related presentation, will be available via webcast on the Manitowoc website at http://ir.manitowoc.com in the "Events & Presentations" section. A replay of the conference call will also be available at the same location on the website.

About The Manitowoc Company, Inc.

The Manitowoc Company was founded in 1902 and has over a 120-year tradition of providing high-quality, customer-focused products and support services to its markets. Headquartered in Milwaukee, Wisconsin, United States, Manitowoc is one of the world's leading providers of engineered lifting solutions. Manitowoc, through its wholly-owned subsidiaries, designs, manufactures, markets, distributes, and supports comprehensive product lines of mobile hydraulic cranes, lattice-boom crawler cranes, boom trucks, and tower cranes under the Aspen Equipment, Grove, Manitowoc, MGX Equipment Services, National Crane, Potain, and Shuttlelift brand names.

Footnote

⁽¹⁾Adjusted net income, adjusted diluted net income per share (“Adjusted DEPS”), EBITDA, adjusted EBITDA, adjusted operating income, adjusted return on invested capital ("Adjusted ROIC"), and free cash flows are financial measures that are not in accordance with U.S. GAAP. For definitions and a reconciliation to the most comparable U.S. GAAP numbers, please see the schedule of “Non-GAAP Financial Measures” at the end of this press release.

Forward-looking Statements

This press release includes “forward-looking statements” intended to qualify for the safe harbor from liability under the Private Securities Litigation Reform Act of 1995. Any statements contained in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations of the management of the Company and are subject to uncertainty and changes in circumstances. Forward-looking statements include, without limitation, statements typically containing words such as “intends,” “expects,” “anticipates,” “targets,” “estimates,” and words of similar import. By their nature, forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results and developments to differ materially include, among others:

• Macroeconomic conditions, including inflation, high interest rates and recessionary concerns, as well as continuing global supply chain constraints, labor constraints, logistics constraints and cost pressures such as changes in raw material and commodity costs, have had, and may continue to have, a negative impact on Manitowoc’s ability to convert backlog into revenue which could, and has, impacted its financial condition, cash flows, and results of operations (including future uncertain impacts);
• actions of competitors;
• changes in economic or industry conditions generally or in the markets served by Manitowoc;
• geopolitical events, including the ongoing conflicts in Ukraine and in the Middle East, other political and economic conditions and risks and other geographic factors, has had and may continue to lead to market disruptions, including volatility in commodity prices (including oil and gas), raw material and component costs, energy prices, inflation, consumer behavior, supply chain, and credit and capital markets, and could result in the impairment of assets;
• changes in customer demand, including changes in global demand for high-capacity lifting equipment, changes in demand for lifting equipment in emerging economies and changes in demand for used lifting equipment including changes in government approval and funding of projects;
• the ability to convert backlog, orders and order activity into sales and the timing of those sales;
• failure to comply with regulatory requirements related to the products and aftermarket services the Company sells;
• the ability to capitalize on key strategic opportunities and the ability to implement Manitowoc’s long-term initiatives;
• impairment of goodwill and/or intangible assets;
• changes in revenues, margins and costs;
• the ability to increase operational efficiencies across Manitowoc and to capitalize on those efficiencies;
• the ability to generate cash and manage working capital consistent with Manitowoc’s stated goals;
• work stoppages, labor negotiations, labor rates and labor costs;
• the Company’s ability to attract and retain qualified personnel;
• changes in the capital and financial markets;
• the ability to complete and appropriately integrate acquisitions, strategic alliances, joint ventures or other significant transactions;
• issues associated with the availability and viability of suppliers;
• the ability to significantly improve profitability;
• realization of anticipated earnings enhancements, cost savings, strategic options and other synergies, and the anticipated timing to realize those savings, synergies and options;
• the ability to focus on customers, new technologies and innovation;
• uncertainties associated with new product introductions, the successful development and market acceptance of new and innovative products that drive growth;
• the replacement cycle of technologically obsolete products;
• risks associated with high debt leverage;
• foreign currency fluctuation and its impact on reported results;
• the ability of Manitowoc's customers to receive financing;
• risks associated with data security and technological systems and protections;
• the ability to direct resources to those areas that will deliver the highest returns;
• risks associated with manufacturing or design defects;
• natural disasters, other weather events, pandemics and other public health crises disrupting commerce in one or more regions of the world;
• issues relating to the ability to timely and effectively execute on manufacturing strategies, general efficiencies and capacity utilization of the Company’s facilities;
• the ability to focus and capitalize on product and service quality and reliability;
• issues associated with the quality of materials, components and products sourced from third parties and the ability to successfully resolve those issues;
• issues related to workforce reductions and potential subsequent rehiring;
• changes in laws throughout the world, including governmental regulations on climate change;
• the inability to defend against potential infringement claims on intellectual property rights;
• the ability to sell products and services through distributors and other third parties;
• issues affecting the effective tax rate for the year;
• acts of terrorism; and
• other risks and factors detailed in Manitowoc's 2023 Annual Report on Form 10-K and its other filings with the United States Securities and Exchange Commission.

Manitowoc undertakes no obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise. Forward-looking statements only speak as of the date on which they are made. Information on the potential factors that could affect the Company's actual results of operations is included in its filings with the Securities and Exchange Commission, including but not limited to its Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

THE MANITOWOC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share and share amounts)
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Net sales		$	562.1			$	602.8			$	1,057.2			$	1,111.1
Cost of sales			462.4				479.8				865.0				881.8
Gross profit			99.7				123.0				192.2				229.3
Operating costs and expenses:
Engineering, selling and administrative expenses			83.7				87.6				159.7				162.7
Amortization of intangible assets			0.8				0.7				1.5				1.7
Restructuring expense			2.3				0.3				2.9				0.3
Total operating costs and expenses			86.8				88.6				164.1				164.7
Operating income			12.9				34.4				28.1				64.6
Other income (expense):
Interest expense			(9.6	)			(9.0	)			(18.8	)			(17.1	)
Amortization of deferred financing fees			(0.4	)			(0.4	)			(0.7	)			(0.7	)
Other income (expense) - net			0.3				(10.0	)			1.0				(11.1	)
Total other expense			(9.7	)			(19.4	)			(18.5	)			(28.9	)
Income before income taxes			3.2				15.0				9.6				35.7
Provision (benefit) for income taxes			1.6				(5.2	)			3.5				(1.0	)
Net income		$	1.6			$	20.2			$	6.1			$	36.7
Per Share Data and Share Amounts:
Basic net income per common share		$	0.05			$	0.58			$	0.17			$	1.05
Diluted net income per common share		$	0.04			$	0.57			$	0.17			$	1.03
Weighted average shares outstanding - basic			35,368,492				35,084,580				35,316,971				35,102,924
Weighted average shares outstanding - diluted			35,738,322				35,650,143				35,899,481				35,766,952

THE MANITOWOC COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except par value and share amounts)
		June 30, 2024				December 31, 2023
Assets
Current Assets:
Cash and cash equivalents		$	38.1			$	34.4
Accounts receivable, less allowances of $5.6 and $6.1, respectively			257.3				278.8
Inventories — net			759.4				666.5
Notes receivable — net			4.7				6.7
Other current assets			33.0				46.6
Total current assets			1,092.5				1,033.0
Property, plant and equipment — net			355.5				366.1
Operating lease right-of-use assets			56.1				59.7
Goodwill			78.9				79.6
Other intangible assets — net			122.1				125.6
Other non-current assets			42.8				42.7
Total assets		$	1,747.9			$	1,706.7
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued expenses		$	481.8			$	457.4
Customer advances			17.8				19.2
Short-term borrowings and current portion of long-term debt			21.4				13.4
Product warranties			38.5				47.1
Other liabilities			19.1				26.2
Total current liabilities			578.6				563.3
Non-Current Liabilities:
Long-term debt			406.3				358.7
Operating lease liabilities			44.0				47.2
Deferred income taxes			7.4				7.5
Pension obligations			51.2				55.8
Postretirement health and other benefit obligations			5.3				5.6
Long-term deferred revenue			19.6				24.1
Other non-current liabilities			43.2				41.2
Total non-current liabilities			577.0				540.1
Stockholders' Equity:
Preferred stock (authorized 3,500,000 shares of $.01 par value; none outstanding)			—				—
Common stock (75,000,000 shares authorized, 40,793,983 shares issued, 35,116,857 and 35,094,993 shares outstanding, respectively)			0.4				0.4
Additional paid-in capital			610.1				613.1
Accumulated other comprehensive loss			(100.5	)			(86.4	)
Retained earnings			149.6				143.5
Treasury stock, at cost (5,677,126 and 5,698,990 shares, respectively)			(67.3	)			(67.3	)
Total stockholders' equity			592.3				603.3
Total liabilities and stockholders' equity		$	1,747.9			$	1,706.7

THE MANITOWOC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Cash Flows from Operating Activities:
Net income		$	1.6			$	20.2			$	6.1			$	36.7
Adjustments to reconcile net income to cash provided by (used for) operating activities:
Depreciation expense			14.6				14.2				29.3				28.1
Amortization of intangible assets			0.8				0.7				1.5				1.7
Stock-based compensation expense			1.9				2.3				5.6				5.4
Amortization of deferred financing fees			0.4				0.4				0.7				0.7
Loss (gain) on sale of property, plant and equipment			0.1				(0.2	)			0.3				(0.2	)
Deferred income tax benefit			—				(14.0	)			—				(14.0	)
Loss on foreign currency translation adjustments			—				9.3				—				9.3
Changes in operating assets and liabilities
Accounts receivable			32.2				(24.2	)			16.9				(7.1	)
Inventories			(15.1	)			(5.5	)			(104.2	)			(107.4	)
Notes receivable			0.6				2.2				2.1				3.9
Other assets			8.9				6.3				10.0				7.9
Accounts payable			(24.3	)			(36.7	)			32.3				19.5
Accrued expenses and other liabilities			(10.7	)			7.8				(20.2	)			12.4
Net cash provided by (used for) operating activities			11.0				(17.2	)			(19.6	)			(3.1	)
Cash Flows from Investing Activities:
Capital expenditures			(12.9	)			(27.0	)			(25.1	)			(36.3	)
Proceeds from sale of fixed assets			3.3				3.1				3.5				5.1
Net cash used for investing activities			(9.6	)			(23.9	)			(21.6	)			(31.2	)
Cash Flows from Financing Activities:
Proceeds from revolving credit facility - net			23.5				12.0				37.5				12.0
Payments on revolving credit facility			—				—				—				(10.0	)
Proceeds from revolving credit facility			10.0				—				10.0				—
Proceeds from (payments on) other debt - net			(19.0	)			0.7				10.1				(1.2	)
Exercise of stock options			—				—				—				0.3
Common stock repurchases			(5.7	)			(2.0	)			(5.7	)			(5.5	)
Other financing activities			(3.3	)			—				(6.2	)			—
Net cash provided by (used for) financing activities			5.5				10.7				45.7				(4.4	)
Effect of exchange rate changes on cash and cash equivalents			(0.3	)			(0.2	)			(0.8	)			0.2
Net increase (decrease) in cash and cash equivalents			6.6				(30.6	)			3.7				(38.5	)
Cash and cash equivalents at beginning of period			31.5				56.5				34.4				64.4
Cash and cash equivalents at end of period		$	38.1			$	25.9			$	38.1			$	25.9

Non-GAAP Financial Measures

Adjusted net income, Adjusted DEPS, EBITDA, adjusted EBITDA, adjusted operating income, Adjusted ROIC, and free cash flows are financial measures that are not in accordance with U.S. GAAP. Manitowoc believes these non-GAAP financial measures provide important supplemental information to both management and investors regarding financial and business trends used in assessing its results of operations. Manitowoc believes excluding specified items provides a more meaningful comparison to the corresponding reporting periods and internal budgets and forecasts, assists investors in performing analysis that is consistent with financial models developed by investors and research analysts, provides management with a more relevant measure of operating performance, and is more useful in assessing management performance.

Adjusted Net Income and Adjusted DEPS

The Company defines adjusted net income as net income plus the addback or subtraction of restructuring and other non-recurring items. Adjusted DEPS is defined as adjusted net income divided by diluted weighted average shares outstanding. Diluted weighted average common shares outstanding are adjusted for the effect of dilutive stock awards when there is net income on an adjusted basis, as applicable. The reconciliation of net income and diluted net income per share to adjusted net income and Adjusted DEPS for the three and six months ended June 30, 2024 and 2023 are summarized as follows. All dollar amounts are in millions, except per share data and share amounts.

		Three Months Ended June 30,
		2024												2023
		As reported				Adjustments				Adjusted				As reported				Adjustments				Adjusted
Gross profit		$	99.7			$	—			$	99.7			$	123.0			$	—			$	123.0
Engineering, selling and administrative expenses (1)			(83.7	)			5.4				(78.3	)			(87.6	)			10.8				(76.8	)
Amortization of intangible assets			(0.8	)			—				(0.8	)			(0.7	)			—				(0.7	)
Restructuring expense (2)			(2.3	)			2.3				—				(0.3	)			0.3				—
Operating income			12.9				7.7				20.6				34.4				11.1				45.5
Interest expense			(9.6	)			—				(9.6	)			(9.0	)			—				(9.0	)
Amortization of deferred financing fees			(0.4	)			—				(0.4	)			(0.4	)			—				(0.4	)
Other income (expense) - net (3)			0.3				—				0.3				(10.0	)			9.3				(0.7	)
Income before income taxes			3.2				7.7				10.9				15.0				20.4				35.4
(Provision) benefit for income taxes (4)			(1.6	)			(0.5	)			(2.1	)			5.2				(14.0	)			(8.8	)
Net income		$	1.6			$	7.2			$	8.8			$	20.2			$	6.4			$	26.6
Diluted weighted average common shares outstanding			35,738,322								35,738,322				35,650,143								35,650,143
Diluted net income per share		$	0.04							$	0.25			$	0.57							$	0.75

(1)		The adjustment in 2024 represents $5.3 million of costs associated with a legal matter with the U.S. EPA and $0.1 million of one-time costs. The adjustment in 2023 represents $10.8 million of costs associated with a legal matter with the U.S. EPA.
(2)		The adjustment in 2024 and 2023 represents the addback of restructuring expense.
(3)		The adjustment in 2023 represents the write-off of $9.3 million of non-cash foreign currency translation adjustments from the curtailment of operations in Russia.
(4)		The adjustment in 2024 represents the net income tax impacts of items (1) and (2). The adjustment in 2023 represents the net income tax impact of items (1), (2), and (3), and the removal of a $13.9 million benefit from the release of a valuation allowance.

		Six Months Ended June 30,
		2024												2023
		As reported				Adjustments				Adjusted				As reported				Adjustments				Adjusted
Gross profit		$	192.2			$	—			$	192.2			$	229.3			$	—			$	229.3
Engineering, selling and administrative expenses (1)			(159.7	)			5.5				(154.2	)			(162.7	)			10.8				(151.9	)
Amortization of intangible assets			(1.5	)			—				(1.5	)			(1.7	)			—				(1.7	)
Restructuring expense (2)			(2.9	)			2.9				—				(0.3	)			0.3				—
Operating income			28.1				8.4				36.5				64.6				11.1				75.7
Interest expense			(18.8	)			—				(18.8	)			(17.1	)			—				(17.1	)
Amortization of deferred financing fees			(0.7	)			—				(0.7	)			(0.7	)			—				(0.7	)
Other income (expense) - net (3)			1.0				—				1.0				(11.1	)			9.3				(1.8	)
Income before income taxes			9.6				8.4				18.0				35.7				20.4				56.1
(Provision) benefit for income taxes (4)			(3.5	)			(0.6	)			(4.1	)			1.0				(14.0	)			(13.0	)
Net income		$	6.1			$	7.8			$	13.9			$	36.7			$	6.4			$	43.1
Diluted weighted average common shares outstanding			35,899,481								35,899,481				35,766,952								35,766,952
Diluted net income per share		$	0.17							$	0.39			$	1.03							$	1.21

(1)		The adjustment in 2024 represents $5.3 million of costs associated with a legal matter with the U.S. EPA and $0.2 million of one-time costs. The adjustment in 2023 represents $10.8 million of costs associated with a legal matter with the U.S. EPA.
(2)		The adjustment in 2024 and 2023 represents the addback of restructuring expense.
(3)		The adjustment in 2023 represents the write-off of $9.3 million of non-cash foreign currency translation adjustments from the curtailment of operations in Russia.
(4)		The adjustment in 2024 represents the net income tax impacts of items (1) and (2). The adjustment in 2023 represents the net income tax impact of items (1), (2), and (3), and the removal of a $13.9 million benefit from the release of a valuation allowance.

Adjusted ROIC

The Company defines Adjusted ROIC as adjusted net operating profit after tax (“Adjusted NOPAT”) for the trailing twelve-months ended divided by the five-quarter average of invested capital. Adjusted NOPAT is calculated for each quarter by taking operating income plus the addback of amortization of intangible assets and the addback or subtraction of restructuring expenses, other non-recurring items - net, and provision for income taxes, which is determined using a 15% tax rate. Invested capital is defined as net total assets less cash and cash equivalents and income tax assets - net plus short-term and long-term debt. Income taxes are defined as income tax payables/receivables, net deferred tax assets/liabilities, and uncertain tax positions.

The Company’s Adjusted ROIC as of June 30, 2024 was 7.1%. Below is the calculation of Adjusted ROIC as of June 30, 2024.

	Three Months Ended
	June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023				Trailing Twelve Months
Operating income	$	12.9			$	15.2			$	9.8			$	18.0			$	55.9
Amortization of intangible assets		0.8				0.7				0.8				0.7				3.0
Restructuring expense		2.3				0.6				0.3				0.7				3.9
Other non-recurring items - net1		5.4				0.1				10.8				0.2				16.5
Adjusted operating income		21.4				16.6				21.7				19.6				79.3
Provision for income taxes		(3.2	)			(2.5	)			(3.3	)			(2.9	)			(11.9	)
Adjusted NOPAT	$	18.2			$	14.1			$	18.4			$	16.7			$	67.4

	June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023				June 30, 2023				5-Quarter Average
Total assets	$	1,747.9			$	1,780.6			$	1,706.7			$	1,692.2			$	1,701.1			$	1,725.7
Total liabilities		(1,155.6	)			(1,184.6	)			(1,103.4	)			(1,119.2	)			(1,121.7	)			(1,136.9	)
Net total assets		592.3				596.0				603.3				573.0				579.4				588.8
Cash and cash equivalents		(38.1	)			(31.5	)			(34.4	)			(40.0	)			(25.9	)			(34.0	)
Short-term borrowings and current portion of long-term debt		21.4				42.5				13.4				30.3				6.7				22.9
Long-term debt		406.3				372.7				358.7				368.5				380.7				377.4
Income tax assets - net		(4.4	)			(3.4	)			(2.6	)			(4.3	)			(2.1	)			(3.3	)
Invested capital	$	977.5			$	976.3			$	938.4			$	927.5			$	938.8			$	951.7
Adjusted ROIC																						7.1	%

(1)

Other non-recurring items - net for the three months ended June 30, 2024 relate to $5.3 million of costs associated with a legal matter with the U.S. EPA and $0.1 million of one-time costs. Other non-recurring items – net for the trailing twelve months relate to $15.7 million of costs associated with a legal matter with the U.S. EPA and $0.8 million of one-time costs. Refer to the Company’s previously filed Form 10-K and Form 10-Qs for a description of other non-recurring items - net for the three months ended March 31, 2024, December 31, 2023, and September 30, 2023.

Free Cash Flows

The Company defines free cash flows as net cash provided by (used for) operating activities less cash outflow from investment in capital expenditures. The reconciliation of net cash provided by (used for) operating activities to free cash flows for the three and six months ended June 30, 2024 and 2023 are summarized as follows. All dollar amounts are in millions.

		Three Months Ended June 30,								Six Months Ended June 30,
		2024				2023				2024				2023
Net cash provided by (used for) operating activities		$	11.0			$	(17.2	)		$	(19.6	)		$	(3.1	)
Capital expenditures			(12.9	)			(27.0	)			(25.1	)			(36.3	)
Free cash flows		$	(1.9	)		$	(44.2	)		$	(44.7	)		$	(39.4	)

EBITDA and Adjusted EBITDA

The Company defines EBITDA as net income before interest, taxes, depreciation, and amortization. The Company defines adjusted EBITDA as EBITDA plus the addback or subtraction of restructuring expense, other (income) expense - net, and other non-recurring items - net. The reconciliation of net income to EBITDA, and further to adjusted EBITDA for the three and six months ended June 30, 2024 and 2023 and trailing twelve months are summarized as follows. All dollar amounts are in millions.

	Three Months Ended June 30,								Six Months Ended June 30,								Trailing Twelve
	2024				2023				2024				2023				Months
Net income	$	1.6			$	20.2			$	6.1			$	36.7			$	8.6
Interest expense and amortization of deferred financing fees		10.0				9.4				19.5				17.8				36.9
Provision (benefit) for income taxes		1.6				(5.2	)			3.5				(1.0	)			9.5
Depreciation expense		14.6				14.2				29.3				28.1				57.8
Amortization of intangible assets		0.8				0.7				1.5				1.7				3.0
EBITDA		28.6				39.3				59.9				83.3				115.8
Restructuring expense		2.3				0.3				2.9				0.3				3.9
Other non-recurring items - net (1)		5.4				10.8				5.5				10.8				16.5
Other (income) expense - net (2)		(0.3	)			10.0				(1.0	)			11.1				0.9
Adjusted EBITDA	$	36.0			$	60.4			$	67.3			$	105.5			$	137.1
Adjusted EBITDA margin percentage		6.4	%			10.0	%			6.4	%			9.5	%			6.3	%

(1)		Other non-recurring items - net for the three months ended June 30, 2024 relate to $5.3 million of costs associated with a legal matter with the U.S. EPA and $0.1 million of one-time costs. Other non-recurring items - net for the six months ended June 30, 2024 relate to $5.3 million of costs associated with a legal matter with the U.S. EPA and $0.2 million of one-time costs. Other non-recurring items - net for the three and six months ended June 30, 2023 relate to $10.8 million of costs associated with a legal matter with the U.S. EPA. Other non-recurring items – net for the trailing twelve months relate to $15.7 million of costs associated with a legal matter with the U.S. EPA and $0.8 million of one-time costs.
(2)		Other (income) expense - net includes net foreign currency gains (losses), other components of net periodic pension costs, and other items in the three and trailing twelve months ended June 30, 2024 and the three months ended June 30, 2023. Other expense – net for the three and six months ended June 30, 2023 includes a $9.3 million write-off of non-cash foreign currency translation adjustments from the curtailment of operations in Russia.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240807793968/en/

Ion Warner

SVP, Marketing and Investor Relations

+1 414-760-4805

Source: The Manitowoc Company, Inc.

FAQ

What were Manitowoc's Q2 2024 financial results?

Manitowoc reported Q2 2024 net sales of $562.1 million, down 6.8% year-over-year, and adjusted EBITDA of $36.0 million, a 40.4% decrease from the prior year. Net income was $1.6 million, or $0.04 per diluted share.

How has Manitowoc (MTW) updated its full-year 2024 guidance?

Manitowoc lowered its 2024 guidance. Net sales are now expected to be $2.175-$2.225 billion (previously $2.275-$2.375 billion), adjusted EBITDA $125-$140 million (previously $150-$180 million), and adjusted EPS $0.45-$0.90 (previously $0.95-$1.55).

What factors affected Manitowoc's Q2 2024 performance?

Manitowoc faced operational issues, sluggish order intake for mobile cranes in Europe and North America, and continued headwinds in the Tower Crane business in Europe. Uncertainties related to the U.S. election and higher interest rates also impacted customer decisions.

What is Manitowoc's (MTW) strategy for long-term growth?

Manitowoc is focusing on its CRANES+50 strategy to transform as a stand-alone crane company, emphasizing continuous improvement through The Manitowoc Way and growing its aftermarket business to drive long-term shareholder value.