Nearly $110m of sales revenue contributed by Grove enabled Manitowoc Company Inc to report an 85% rise in crane sales in the first quarter of 2003.
Crane sales in the three month period came to $238.9m. But excluding Grove, acquired during the second quarter of 2002, Manitowoc’s crane sales fell 32%.
Main cause of the fall was the drop in demand for crawler cranes in the USA, the company said.
Operating profit from cranes was down 45% to $6.9m as more smaller cranes and fewer bigger cranes were made. Manufacturers generally have a bigger profit margin on bigger cranes.
Manitowoc chairman and chief executive officer Terry Growcock said: “Global demand for cranes, particularly crawler cranes, continues to be adversely affected by weak non-residential construction as well as deferrals in spending for power plant renovation. Since peaking in 1999, the global crawler crane industry has seen three consecutive years of retraction, including market declines of 16% in 2001, 22% in 2002, and forecasts for even greater declines this year. Despite this unfavorable trend, Manitowoc has weathered these difficult times by our increasing global presence and our continued integration success.”
The backlog of crane orders on 31 March 2003 was worth $202.1m.
As a group, Manitowoc Company Inc reported record revenues for the first quarter, with net sales up 34% to $379.3m. Net profit was $500,000, compared with a loss of $30.2m in the first quarter of 2002.
As well as the downturn in the crane market, Manitowoc has also hit by a 44-day strike at its Marinette Marine shipyard Growcock added: “We will continue to consolidate and rationalise existing operations, while divesting non-core operations and facilities as we did with the sale of Femco during the first quarter. Finally, we will strengthen our financial structure by intensifying our focus on cash flow from operations and debt reduction. Our goal is to achieve a debt-to-capital ratio target of 55 percent within the next 18 to 24 months.”
