Terex sales fall, but company still profitable

WESTPORT, Conn. — Genie parent company Terex reported that sales of aerial work platforms, which the company makes in Moses Lake, fell by 21 percent in the last three months of 2019.

Despite seeing a 3.6 percent decline in sales in 2019, Terex still made a profit of $376.4 million on $4.4 billion in sales. That was down from a 2018 profit of $453 million on sales of $4.5 billion.

Overall, sales of the company’s aerial work platforms (AWP) were down 8 percent in 2019, according to Terex Chief Financial Officer John D. Sheehan, speaking during a Terex conference call outlining earnings for the fourth quarter of 2019.

The company expects sales of aerial work platforms to continue to fall by 7-10 percent in 2020 but still expects total lift sales worldwide of $2.7 billion.

However, Terex executives were quick to note the company is still profitable. Sheehan said the company’s AWP business had “positive operating margins” in the fourth quarter of 2019 “and will have positive operating margins” in the first quarter of 2020.

“The segment isn’t losing money,” Sheehan said of the company’s aerial work platform business.

Sheehan and Terex CEO John Garrison described a “challenging environment” worldwide for the company’s aerial work platforms, noting that in response, the company has reduced production 45 percent in the fourth quarter of 2019 compared with the same period in 2018.

Many of the company’s major customers — large rental firms like United Rentals — are delaying or scaling back purchases, both Garrison and Sheehan said, and the company is trying to focus on selling off existing inventory.

Garrison said the company’s Genie brand “is synonymous with technological achievement and innovation.” The company will be adding fuel-efficient and hybrid lifts to its product line and anticipates some uptick in demand when new load standards are introduced in March.

Eventually, Sheehan said he expects demand for aerial work platforms to improve beginning in the middle of the year, and with it, the company’s revenue and profits.

“We do expect margins to improve,” he said.

Terex makes aerial work platforms and crushing machines for a number of different uses, mainly in construction and maintenance. According to the Grant County Economic Development Council, the Genie plant in Moses Lake is the largest private employer in Grant County.

On Tuesday, Terex shares traded on the New York Stock Exchange (NYSE) ended trading at $24.62, down $1.08 per share or 4.2 percent, on a day the NYSE composite index fell 58 points, less than half a percent, to close at 14,093.11 points.

Charles H. Featherstone can be reached at [email protected].