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September 16, 2014
Morgan Stanley 2nd Annual Laguna Conference
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,” “expects,” “intends,” “anticipates,” “plans,” “projects,” “estimates” and the negatives thereof and analogous or similar expressions are intended to identify forward-looking statements. However, the absence of these words does not mean that the statement is not forward-looking. The Company has based these forward-looking statements on current expectations and projections about future events. These statements are not guarantees of future performance.
Because forward-looking statements involve risks and uncertainties, actual results could differ materially. Such risks and uncertainties,
many of which are beyond the control of Terex, include among others: Our business is cyclical and weak general economic conditions
affect the sales of our products and financial results; our ability to successfully integrate acquired businesses; the need to comply with
restrictive covenants contained in our debt agreements; our ability to generate sufficient cash flow to service our debt obligations and
operate our business; our ability to access the capital markets to raise funds and provide liquidity; our business is sensitive to government
spending; our business is very competitive and is affected by our cost structure, pricing, product initiatives and other actions taken by
competitors; our ability to timely manufacture and deliver products to customers; our retention of key management personnel; the financial
condition of suppliers and customers, and their continued access to capital; our providing financing and credit support for some of our
customers; we may experience losses in excess of recorded reserves; impairment in the carrying value of goodwill and other indefinite-
lived intangible assets; our ability to obtain parts and components from suppliers on a timely basis at competitive prices; our business is
global and subject to changes in exchange rates between currencies, regional economic conditions and trade restrictions; our operations
are subject to a number of potential risks that arise from operating a multinational business, including compliance with changing
regulatory environments, the Foreign Corrupt Practices Act and other similar laws and political instability; a material disruption to one of
our significant facilities; possible work stoppages and other labor matters; compliance with changing laws and regulations, particularly
environmental and tax laws and regulations; litigation, product liability claims, patent claims, class action lawsuits and other liabilities; our
ability to comply with an injunction and related obligations resulting from the settlement of an investigation by the United States Securities
and Exchange Commission (“SEC”); our implementation of a global enterprise resource planning system and its performance; and other
factors, risks and uncertainties that are more specifically set forth in our public filings with the SEC. Non-GAAP Measures: Terex from time to time refers to various non-GAAP (generally accepted accounting principles) financial measures in this presentation. Terex believes that this information is useful to understanding its operating results and the ongoing performance of its underlying businesses without the impact of special items. See the appendix at the end of this presentation as well as the Terex second quarter 2014 earnings release on the Investor Relations section of our website www.terex.com for a description and/or reconciliation of these measures.
2
Defining Who We Are
Lifting & Material Handling Solutions Company
Focused on Operational Improvement
Leader in Product Categories
Geographically Diverse
Cash Generator
Profitable
3
Why Invest in Terex?
• Growth in sales is expected to
accelerate in the next 2 to 3 years
• Margins should continue to improve
through initiatives and volume
• Committed to deploying capital
intelligently and efficiently
• Near term performance
expectations are positive
4
5
Second Quarter Results
Q2 EPS of $0.76 for continuing operations, $0.59 compared to prior year EPS
of $0.17 and $0.12 compared to prior year adjusted EPS
Performance was mixed in the quarter
• Overall sales growth 10.4% versus prior year period
• Another strong growth quarter for AWP; margins impacted by product mix and
manufacturing start-up costs
• Improved Construction and MHPS performance was roughly in line with our
expectations
• Cranes performance was down year over year but order intake improving, supporting
stronger 2nd half of 2014
• MP business up slightly versus prior year quarter but below our expectations
Free cash flow of $(19) million in the quarter
2014 guidance of $2.35 to $2.50 EPS, and free cash flow of $200 to $250 million
Free cash flow = net cash provided by (used in) operating activities less capital expenditures
Significant Sales Growth Expected
• Terex net sales are at 65% of prior peak…. Significant growth potential ahead
as markets improve
Note: Includes history for businesses acquired during the period (based on best-available data from predecessor companies)
and excludes the results of any divested businesses
• AWP category is growing worldwide. Is at 90% of prior peak in
2013, but Europe only at ~40% and ROW is growing
• Percentage of prior peak: MP 57%, Cranes 59%, MHPS 70%,
Construction 45%
6
Global Reach – Positioned for Growth
• Improvement in North America driving general improvement in results
• Well positioned in Europe in advance of expected recovery
• Continuing focus on U.S. recovery and on steady, higher margin growth in
other regions
$-
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
2005 2006 2007 2008 2009 2010 2011 2012 2013
North America : Pro Forma Sales by Year ($M)
24% CAGR since '09
$-
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
2005 2006 2007 2008 2009 2010 2011 2012 2013
Western Europe: Pro Forma Sales by Year ($M)
Finding Bottom after"Double Dip"
$-
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
2005 2006 2007 2008 2009 2010 2011 2012 2013
ROW: Pro Forma Sales by Year ($M)
Continuing to focus on profitable growth
Sales shown are on a pro forma basis to show underlying trends in all current businesses over time; data are per best available historical information
7
8
North America
15%
Western Europe
35%
Asia/ Oceania
(3)%
Other
(8)%
LATAM
(27)%
Total Terex Sales by Geography %
Sales by Geography Q2-14 vs. Q2-13
44% 29%
11% 10%
6%
North America
Western Europe
Asia/ Oceania
Other
LATAM
Latest 2014 Segment Outlook (Guidance as of 9/16/2014)
Note: Outlook excludes restructuring and other unusual items.
9
Net Sales Operating Margin
Initial Guidance Updated Guidance Initial Guidance Updated Guidance
AWP High single /
low double digit growth
Low / mid double digit
growth Stable
Mid-teens
Stable Mid-teens
Construction Flat sales Flat sales Continued Improvement
Break even
Continued Improvement Break even
Cranes Low single digit growth Mid single digit
decline Moderate Improvement Mid / upper single digits
Mid single digits
MHPS Low double digit growth High single / low double
digit growth Solid Improvement
Low / mid single digits
Solid Improvement Low single digits
MP Mid single digit growth Low single digit growth Stable
Low double digits
Stable Low double digits
Goals – Where We Are Heading
• Continued strong performance expected from AWP
• Improving market conditions and performance
expected for Construction, MHPS and MP
• Global crane market continues to be challenging to
forecast, though macro indicators are positive
• Remain focused on execution of internal initiatives to
drive EPS and ROIC growth
• Significant upside potential to performance with end
market improvement in North America and Europe
10
APPENDIX
Terex Book-to-Bill Trend (USD Millions)
12
$349 $304 $637 $571 $517 $342 $451 $799 $603
68%
70%
177%
114%
87%
65%
97%
139%
85%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$100
$200
$300
$400
$500
$600
$700
$800
$900
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
AWP
Net Bookings Book-to-Bill Ratio
$186 $164 $237 $184 $194 $139 $224 $223 $183
72%
82%
130%
95%
93%
82%
127%
126%
89%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$50
$100
$150
$200
$250
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
Construction
Net Bookings Book-to-Bill Ratio
$552 $357 $473 $458 $460 $363 $512 $533 $499
113%
70% 93% 98%
89% 81%
108%
138%
100.0%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$100
$200
$300
$400
$500
$600
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
Cranes
Net Bookings Book-to-Bill Ratio
$631 $396 $374 $496 $393 $510 $375 $398 $418
144%
90%
90%
148%
107%
112%
71%
109%
98%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$100
$200
$300
$400
$500
$600
$700
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
MHPS
Net Bookings Book-to-Bill Ratio
$1,894 $1,360 $1,880 $1,879 $1,718 $1,499 $1,740 $2,125 $1,911
99%
78%116%
114%
92%
85%
96%
128%
93%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$500
$1,000
$1,500
$2,000
$2,500
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
Terex
Net Bookings Book-to-Bill Ratio
$170 $131 $155 $168 $151 $139 $159 $163 $174
90%
87%
103%
110%
86%
94%
106%
109%
96%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
$-
$20
$40
$60
$80
$100
$120
$140
$160
$180
$200
Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Q2 '14
MP
Net Bookings Book-to-Bill Ratio
13
Backlog Trend (USD Millions)
14
Q2 2013 Adjustments
USD Millions, except Earnings per Share Q2 2013 Q2 2013
As Reported As Adjusted
Net Sales $1,861.5 - $1,861.5
Gross Profit $351.2 $41.4 $392.6
SG&A ($267.7) $23.5 ($244.2)
Income From Operations $83.5 $64.9 $148.4
Interest Income/ (Expense) ($29.6) - ($29.6)
Other Income/ (Expense) ($7.5) $6.6 ($0.9)
Income/ (Loss) from Cont. Ops before Taxes $46.4 $71.5 $117.9
Provision for Income Taxes ($27.7) ($17.1) ($44.8)
Non Controlling Interest $1.7 $1.7
Income/ (Loss) from Continuing Operations $20.4 $54.4 $74.8
Earnings per Share $0.17 $0.47 $0.64
Restructuring
& Related
15
YTD 2013 Adjustments
USD Millions, except Earnings per Share YTD 2013 YTD 2013
As Reported As Adjusted
Net Sales $3,515.2 - - - $3,515.2
Gross Profit $672.4 $3.2 - $41.4 $717.0
SG&A ($523.3) $0.2 $2.7 $23.5 ($496.9)
Income From Operations $149.1 $3.4 $2.7 $64.9 $220.1
Interest Income/ (Expense) ($61.3) - - - ($61.3)
Other Income/ (Expense) ($9.1) $2.7 - $6.6 $0.2
Income/ (Loss) from Continuing Operations BT $78.7 $6.1 $2.7 $71.5 $159.0
Provision for Income Taxes ($42.3) ($2.2) ($0.8) ($17.1) ($62.4)
Non Controlling Interest $3.3 - - $3.3
Income/ (Loss) from Continuing Operations $39.7 $3.9 $1.9 $54.4 $99.9
Earnings per Share $0.34 $0.03 $0.02 $0.47 $0.86
Restructuring
& Related
Sale of
Roadbuilding
MHPS
Charge
16
Adjusted OP by Segment – Q2 2013
USD in millions Q2 2013 Q2 2013
As Reported As Adjusted
AWP $101.2 - $101.2
Construction ($5.2) $3.4 ($1.8)
Cranes $23.4 $15.0 $38.4
MHPS ($57.2) $46.5 ($10.7)
MP $24.5 - $24.5
Corporate ($3.2) - ($3.2)
Consolidated $83.5 $64.9 $148.4
Restructuring
& Related
Q2 2013 ROIC Calculation
17
See reconciliation of adjusted amounts below on table following ROIC table. Amounts are as of and for the three months ended for the periods referenced in
the table below.
Provision for (benefit from) income taxes $ 27.7 $ 14.6 $ (9.2) $ 7.4
Divided by: Income (loss) before income taxes 46.4 32.3 (40.7) 32.9
Effective tax rate 59.7% 45.2% 22.6% 22.5%
Income (loss) from operations as adjusted $ 83.8 $ 66.1 $ 21.4 $ 127.8
Multiplied by: 1 minus Effective tax rate 40.3% 54.8% 77.4% 77.5%
Adjusted net operating income (loss) after tax $ 33.8 $ 36.2 $ 16.6 $ 99.0
Debt (as defined above) $ 1,870.4 $ 2,082.5 $ 2,098.7 $ 2,063.8 $ 2,402.8
Less: Cash and cash equivalents (548.2) (729.7) (678.0) (542.6) (841.5)
Debt less Cash and cash equivalents $ 1,322.2 $ 1,352.8 $ 1,420.7 $ 1,521.2 $ 1,561.3
Total Terex Corporation stockholders’ equity as adjusted $ 2,042.7 $ 2,053.8 $ 2,103.7 $ 2,149.2 $ 2,089.2
Debt less Cash and cash equivalents plus Total Terex
Corporation stockholders’ equity as adjusted $ 3,364.9 $ 3,406.6 $ 3,524.4 $ 3,670.4 $ 3,650.5
June 30, 2013 ROIC 5.3%
Adjusted net operating income (loss) after tax (last 4 quarters)$ 185.6
Average Debt less Cash and cash equivalents plus Total Terex
Corporation stockholders’ equity as adjusted (5 quarters) $ 3,523.4
Reconciliation of income (loss) from operations:
Income (loss) from operations as reported $ 83.5 $ 65.6 $ 23.0 $ 127.1
(Income) loss from operations for TFS 0.3 0.5 (1.6) 0.7
Income (loss) from operations as adjusted $ 83.8 $ 66.1 $ 21.4 $ 127.8
Reconciliation of Terex Corporation stockholders’ equity:
Terex Corporation stockholders’ equity as reported $ 1,955.8 $ 1,957.5 $ 2,007.7 $ 2,054.6 $ 1,989.6
TFS assets (139.7) (147.5) (150.9) (142.3) (129.9)
Redeemable noncontrolling interest 226.6 243.8 246.9 236.9 229.5
Terex Corporation stockholders’ equity as adjusted $ 2,042.7 $ 2,053.8 $ 2,103.7 $ 2,149.2 $ 2,089.2
Sep '12 Jun '12
Sep '12 Jun '12Jun '13 Mar '13 Dec '12
Jun '13 Mar '13 Dec '12