Exiting the first half of FY23, the lifting solutions provider, The Manitowoc Company (NYSE: MTW ), reported another quarter with weak revenue, primarily due to strong declines across Europe and most of the MEAP regions, includingAs a finance enthusiast with experience in research, I am deeply engaged in studying diverse businesses, especially in the technology, industrial, and conglomerate sectors. I really like companies that have strong foundations and see them doing well in the long run. I enjoy writing ...

Manitowoc Company (MTW) FY Conference Summary Company Overview - Manitowoc Company is a crane manufacturer listed on the NYSE, founded in 1902, and has transitioned from a product-focused company to a customer-oriented business emphasizing aftermarket services [5][4][3]. Industry Context - The crane industry has faced a challenging cycle over the past decade, but there are indications that the market may be at or near the bottom of this cycle [1][2]. - The company is optimistic about the potential for growth driven by infrastructure spending and cyclical recovery in the crane market [13][14]. Financial Goals and Performance - Manitowoc aims to grow its revenue from $2.2 billion to $3 billion, with a significant focus on increasing non-new machine sales from approximately $650 million to $1 billion [4][29]. - The aftermarket business, which includes parts and services, is expected to be a major driver of EBITDA and return on invested capital (ROIC) [4][29]. Key Growth Drivers 1. **Secular Growth**: Increased infrastructure spending globally, particularly in the U.S. for electricity generation and data centers, is expected to drive demand for cranes [15][16]. 2. **Cyclical Recovery**: The European tower crane market is showing signs of recovery after a downturn, with increased housing needs in the UK and Germany [17][24]. 3. **Mergers and Acquisitions**: Successful acquisitions, such as the H and E crane business and Aspen equipment, have contributed positively to the aftermarket and overall revenue [27][28]. 4. **Organic Growth Initiatives**: Expansion of service locations and technician workforce to enhance customer service and support [39][37]. Market Dynamics - The company has noted a significant increase in the value per machine due to larger cranes being utilized, which has implications for revenue growth despite lower unit volumes compared to historical peaks [22][21]. - The impact of tariffs on steel and components is being closely monitored, as it could affect pricing and margins [49][52]. Strategic Focus - Manitowoc is committed to continuous improvement through initiatives like the "Manitowoc Way," which emphasizes operational efficiency and safety [9][11]. - The company is also focusing on enhancing its aftermarket services, which are less cyclical and provide more stable revenue streams [29][30]. Challenges and Considerations - The crane business is inherently cyclical, and while there are positive signs, the company remains cautious about predicting market turns [53]. - High leverage (around four times) is a concern, limiting the company's ability to engage in stock buybacks or further acquisitions until it is reduced [48]. Conclusion - Manitowoc is positioned for potential growth through strategic initiatives focused on aftermarket services, infrastructure spending, and cyclical recovery in the crane market. The company remains vigilant about market conditions and operational efficiency to drive long-term value [54][53].

[Second-Quarter 2025 Performance Overview](index=1&type=section&id=Second-Quarter%202025%20Performance%20Overview) The company reported its second-quarter 2025 financial results, highlighting key performance metrics and management's strategic outlook [Key Financial Highlights](index=1&type=section&id=Key%20Financial%20Highlights) The company reported mixed Q2 2025 financial results, with increased orders and backlog but decreased net sales and adjusted EBITDA Key Financial Highlights (Q2 2025) | Metric | Q2 2025 (Millions) | YoY Change | | :-------------------------- | :----------------- | :--------- | | Net income | $1.5 | - | | Adjusted net income | $2.8 | - | | Diluted EPS | $0.04 | - | | Adjusted diluted EPS | $0.08 | - | | Orders | $453.9 | +6.0% | | Backlog | $729.3 | - | | Net sales | $539.5 | -4.0% | | Non-new machine sales | $161.6 | +9.7% | | Adjusted EBITDA | $26.3 | -26.9% | [Management Commentary & Business Outlook](index=1&type=section&id=Management%20Commentary%20%26%20Business%20Outlook) Management highlighted strong order growth and market 'green shoots' despite tariff headwinds, adjusting H2 2025 schedules and anticipating lower-end guidance - Achieved solid **6% year-over-year growth in orders**, driven by strong performance in the MGX distribution business and continued momentum in the European tower crane market, despite tariff headwinds[3](index=3&type=chunk) - Adjusted build schedules for the second half of 2025 and anticipate finishing the year at the lower end of guidance range, expecting six months for the U.S. crane market to find a new equilibrium due to trade deals[3](index=3&type=chunk) - Identified 'green shoots' in the market: improving general European economy, rebounding European tower crane business, active Middle East, improvements in Asia Pacific, and contracting U.S. crane rental house inventory, all signaling positive trends once the tariff environment stabilizes[4](index=4&type=chunk) [Company Information](index=1&type=section&id=Company%20Information) This section provides an overview of The Manitowoc Company, Inc., detailing its history, headquarters, and comprehensive product offerings [About The Manitowoc Company, Inc.](index=1&type=section&id=About%20The%20Manitowoc%20Company%2C%20Inc.) Founded in 1902, Manitowoc is a global provider of engineered lifting products and services, headquartered in Milwaukee, Wisconsin - Founded in 1902, with over a 120-year tradition of providing high-quality, customer-focused products and support services[6](index=6&type=chunk) - Headquartered in Milwaukee, Wisconsin, United States, and is one of the world's leading providers of engineered lifting products and services[6](index=6&type=chunk) - Designs, manufactures, markets, distributes, and supports comprehensive product lines including mobile hydraulic cranes, lattice-boom crawler cranes, boom trucks, and tower cranes under various brands[6](index=6&type=chunk) [Forward-looking Statements](index=2&type=section&id=Forward-looking%20Statements) This section outlines the company's forward-looking statements and the various risk factors that could impact future performance [Forward-looking Statements Disclaimer and Risk Factors](index=2&type=section&id=Forward-looking%20Statements%20Disclaimer%20and%20Risk%20Factors) This section contains forward-looking statements, subject to uncertainties and risks including macroeconomic conditions, geopolitical events, and trade policy changes - Statements are based on current management expectations and are subject to uncertainty and changes in circumstances, not guarantees of future performance[9](index=9&type=chunk) - Factors that could cause actual results to differ materially include macroeconomic conditions (inflation, interest rates, tariffs, supply chain, labor, logistics), actions of competitors, and changes in economic or industry conditions[9](index=9&type=chunk) - Other significant risks include geopolitical events (conflicts in Ukraine and Middle East), changes in customer demand, adverse changes to trade policy (export duties, tariffs), ability to convert backlog into sales, and uncertainties associated with new product introductions[9](index=9&type=chunk)[11](index=11&type=chunk) [Condensed Consolidated Financial Statements](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated financial statements, including statements of operations, balance sheets, and cash flows [Condensed Consolidated Statements of Operations](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Q2 2025 net sales decreased to $539.5 million, with operating income falling to $9.8 million and net income at $1.5 million Three Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------- | :----------------- | :----------------- | | Net sales | $539.5 | $562.1 | | Cost of sales | $440.5 | $462.4 | | Gross profit | $99.0 | $99.7 | | Operating income | $9.8 | $12.9 | | Income (loss) before income taxes | $1.3 | $3.2 | | Net income (loss) | $1.5 | $1.6 | | Diluted net income (loss) per common share | $0.04 | $0.04 | Six Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------- | :------------------ | :------------------ | | Net sales | $1,010.4 | $1,057.2 | | Cost of sales | $821.6 | $865.0 | | Gross profit | $188.8 | $192.2 | | Operating income | $15.1 | $28.1 | | Income (loss) before income taxes | $(7.5) | $9.6 | | Net income (loss) | $(4.8) | $6.1 | | Diluted net income (loss) per common share | $(0.14) | $0.17 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Total assets increased to $1,883.8 million as of June 30, 2025, driven by higher inventories and accounts receivable, with liabilities and equity also rising As of June 30, 2025 vs. December 31, 2024 | Metric | June 30, 2025 (Millions) | Dec 31, 2024 (Millions) | | :------------------------------------ | :----------------------- | :---------------------- | | Total current assets | $1,162.7 | $958.9 | | Total assets | $1,883.8 | $1,660.0 | | Total current liabilities | $560.4 | $474.3 | | Total non-current liabilities | $642.1 | $545.6 | | Total liabilities | $1,202.5 | $1,019.9 | | Total stockholders' equity | $681.3 | $640.1 | - Inventories increased to **$782.5 million** as of June 30, 2025, from $609.4 million at December 31, 2024[15](index=15&type=chunk) - Long-term debt increased to **$459.8 million** as of June 30, 2025, from $377.1 million at December 31, 2024[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Q2 2025 saw net cash used for operating activities of $67.7 million, primarily due to inventory changes, resulting in an $8.5 million decrease in cash and equivalents Three Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :------------------------------------------ | :----------------- | :----------------- | | Net cash provided by (used for) operating activities | $(67.7) | $11.0 | | Net cash used for investing activities | $(5.9) | $(9.6) | | Net cash provided by financing activities | $63.8 | $5.5 | | Net increase (decrease) in cash and cash equivalents | $(8.5) | $6.6 | | Cash and cash equivalents at end of period | $32.9 | $38.1 | Six Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :------------------------------------------ | :------------------ | :------------------ | | Net cash provided by (used for) operating activities | $(54.8) | $(19.6) | | Net cash used for investing activities | $(29.5) | $(21.6) | | Net cash provided by financing activities | $67.0 | $45.7 | | Net increase (decrease) in cash and cash equivalents | $(15.1) | $3.7 | | Cash and cash equivalents at end of period | $32.9 | $38.1 | - Changes in inventories used **$49.5 million** in cash from operating activities for the three months ended June 30, 2025, compared to $15.1 million used in the prior year period[17](index=17&type=chunk) [Non-GAAP Financial Measures Reconciliation](index=7&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations of non-GAAP financial measures, offering additional insights into the company's performance [Introduction and Rationale](index=7&type=section&id=Introduction%20and%20Rationale) The company utilizes non-GAAP measures like Adjusted EBITDA and Free Cash Flows to provide supplemental financial insights and enhance performance comparison - Non-GAAP financial measures include Adjusted net income (loss), Adjusted DEPS, EBITDA, adjusted EBITDA, adjusted operating income, Adjusted ROIC, and free cash flows[7](index=7&type=chunk)[19](index=19&type=chunk) - These measures provide important supplemental information to management and investors regarding financial and business trends[19](index=19&type=chunk) - Excluding specified items provides a more meaningful comparison, assists investors in analysis, and offers a more relevant measure of operating and management performance[19](index=19&type=chunk) [Adjusted Net Income (Loss) and Adjusted DEPS](index=7&type=section&id=Adjusted%20Net%20Income%20%28Loss%29%20and%20Adjusted%20DEPS) Adjusted net income for Q2 2025 was $2.8 million ($0.08 Adjusted DEPS), reflecting adjustments for restructuring and non-recurring items Three Months Ended June 30 | Metric | 2025 (Reported) | 2025 (Adjusted) | 2024 (Reported) | 2024 (Adjusted) | | :------------------------------------ | :----------------- | :----------------- | :----------------- | :----------------- | | Net income | $1.5 | $2.8 | $1.6 | $8.8 | | Diluted net income per share | $0.04 | $0.08 | $0.04 | $0.25 | Six Months Ended June 30 | Metric | 2025 (Reported) | 2025 (Adjusted) | 2024 (Reported) | 2024 (Adjusted) | | :------------------------------------ | :------------------ | :------------------ | :------------------ | :------------------ | | Net income (loss) | $(4.8) | $(2.9) | $6.1 | $13.9 | | Diluted net income (loss) per share | $(0.14) | $(0.08) | $0.17 | $0.39 | - Adjustments in 2024 included **$5.3 million** of costs associated with a legal matter with the U.S. Environmental Protection Agency (EPA) and $0.1 million of one-time costs for the three months ended June 30, 2024[21](index=21&type=chunk) [Adjusted Return on Invested Capital (ROIC)](index=9&type=section&id=Adjusted%20ROIC) Adjusted ROIC was 4.2% as of June 30, 2025, calculated from adjusted NOPAT and average invested capital - Adjusted ROIC as of June 30, 2025, was **4.2%**[25](index=25&type=chunk)[26](index=26&type=chunk) Adjusted NOPAT (Trailing Twelve Months Ended June 30, 2025) | Metric | Amount (Millions) | | :-------------------------- | :---------------- | | Operating income | $38.8 | | Amortization of intangible assets | $3.0 | | Restructuring expense | $3.5 | | Other non-recurring items - net | $3.6 | | Adjusted operating income | $48.9 | | Provision for income taxes | $(7.3) | | Adjusted NOPAT | $41.6 | Invested Capital (5-Quarter Average as of June 30, 2025) | Metric | Amount (Millions) | | :-------------------------- | :---------------- | | Invested capital | $985.1 | [Free Cash Flows](index=9&type=section&id=Free%20Cash%20Flows) Free cash flows for Q2 2025 were negative $73.7 million, a significant decrease from the prior year, reflecting operating activities and capital expenditures Three Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :------------------------------------------ | :----------------- | :----------------- | | Net cash provided by (used for) operating activities | $(67.7) | $11.0 | | Capital expenditures | $(6.0) | $(12.9) | | Free cash flows | $(73.7) | $(1.9) | Six Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :------------------------------------------ | :------------------ | :------------------ | | Net cash provided by (used for) operating activities | $(54.8) | $(19.6) | | Capital expenditures | $(16.8) | $(25.1) | | Free cash flows | $(71.6) | $(44.7) | [EBITDA and Adjusted EBITDA](index=10&type=section&id=EBITDA%20and%20Adjusted%20EBITDA) Q2 2025 Adjusted EBITDA was $26.3 million, with a 4.9% margin, down from $36.0 million and 6.4% in Q2 2024 Three Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------- | :----------------- | :----------------- | | Net income (loss) | $1.5 | $1.6 | | EBITDA | $26.3 | $28.6 | | Adjusted EBITDA | $26.3 | $36.0 | | Adjusted EBITDA margin percentage | 4.9% | 6.4% | Six Months Ended June 30 | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------- | :------------------ | :------------------ | | Net income (loss) | $(4.8) | $6.1 | | EBITDA | $42.2 | $59.9 | | Adjusted EBITDA | $48.0 | $67.3 | | Adjusted EBITDA margin percentage | 4.8% | 6.4% | Trailing Twelve Months Ended June 30, 2025 | Metric | Amount (Millions) | | :-------------------------- | :---------------- | | Net income (loss) | $44.9 | | EBITDA | $96.6 | | Adjusted EBITDA | $109.1 | | Adjusted EBITDA margin percentage | 4.9% | [Additional Information](index=1&type=section&id=Additional%20Information) This section provides details regarding the upcoming investor conference call and investor relations contact information [Investor Conference Call](index=1&type=section&id=Investor%20Conference%20Call) An investor conference call to discuss Q2 2025 earnings will be held on August 8, 2025, with a live webcast available - Conference call for security analysts and institutional investors to discuss second-quarter 2025 earnings results on **Friday, August 8, 2025, at 10:00 a.m. ET (9:00 a.m. CT)**[5](index=5&type=chunk) - 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[5](index=5&type=chunk) [Investor Relations Contact](index=11&type=section&id=Investor%20Relations%20Contact) Contact details for investor relations inquiries are provided - Contact: Ion Warner, SVP, Marketing and Investor Relations[31](index=31&type=chunk) - Phone: **+1 414-760-4805**[31](index=31&type=chunk)

Core Insights - Manitowoc Company, Inc. (MTW) reported adjusted earnings per share (EPS) of 8 cents for Q2 2025, missing the Zacks Consensus Estimate of 20 cents and down from 25 cents in the same quarter last year [1][7] - Revenues decreased by 4% year over year to $540 million, falling short of the Zacks Consensus Estimate of $570 million [1][7] - Orders increased by 6% year over year to $454 million, with a backlog of $729 million at the end of the quarter [2] Financial Performance - Cost of sales decreased by 4.7% year over year to $440.5 million, while gross profit fell by 0.7% to $99 million [3] - Gross margin improved to 18.4% from 17.7% in the prior-year quarter [3][7] - Adjusted operating income was $10.8 million, down from $20.6 million in the prior-year quarter, and adjusted EBITDA was $26 million compared to $36 million last year [4] Cash Flow and Debt - Cash and cash equivalents were reported at $33 million, down from $48 million at the end of 2024 [5] - Long-term debt increased to $460 million from $377 million at the end of 2024 [5] - The company used $68 million in cash for operating activities in Q2 2025, contrasting with a cash inflow of $11 million in the same quarter last year [5] Stock Performance - Over the past year, MTW shares have gained 12.3%, while the industry has grown by 24.1% [6]

Core Insights - The Manitowoc Company, Inc. (MTW) has experienced a decline in total revenue for the quarter ending June 2025, amounting to $539.5 million, which is a 4% decrease year over year [4]. International Revenue Breakdown - EURAF contributed $152.5 million, representing 28.3% of total revenue, which was a surprise of -13.84% compared to the consensus estimate of $177 million. This is a decrease from $145.6 million (30.9%) in the previous quarter and $176.2 million (31.4%) in the same quarter last year [5]. - MEAP generated $63.8 million, accounting for 11.8% of total revenue, which was a surprise of -34.9% compared to the projected $98 million. In the previous quarter, MEAP contributed $66 million (14%) and $89.2 million (15.9%) in the year-ago quarter [6]. Future Revenue Predictions - Analysts project total revenue for the current fiscal quarter to reach $550 million, reflecting a 4.8% increase from the same quarter last year. EURAF is expected to contribute 24.6% ($135 million) and MEAP 21.8% ($120 million) [7]. - For the entire year, total revenue is forecasted to be $2.23 billion, an improvement of 2.2% from the previous year, with EURAF contributing 28.5% ($635 million) and MEAP 17.5% ($390 million) [8]. Market Performance - The Manitowoc Company has a Zacks Rank 4 (Sell), indicating potential underperformance compared to the broader market in the near term [13]. - The stock has declined by 19.9% over the past month, contrasting with a 2.7% increase in the Zacks S&P 500 composite. Over the past three months, shares have lost 11.1% relative to the S&P 500's 13.2% increase [14].

PART I. FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures [Item 1. Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for The Manitowoc Company, Inc., including statements of operations, comprehensive income, balance sheets, cash flows, and equity for the periods ended June 30, 2025 and 2024, along with detailed notes explaining the company's accounting policies, recent changes, and specific financial line items [Condensed Consolidated Statements of Operations](index=2&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This statement details the company's financial performance, including net sales, gross profit, operating income, and net income for the specified periods Consolidated Statements of Operations (Three Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | Change (%) | | :--------------- | :-------------- | :-------------- | :--------- | | Net sales | $539.5 | $562.1 | -4.0% | | Gross profit | $99.0 | $99.7 | -0.7% | | Operating income | $9.8 | $12.9 | -24.0% | | Net income (loss)| $1.5 | $1.6 | -6.3% | | Basic EPS | $0.04 | $0.05 | -20.0% | | Diluted EPS | $0.04 | $0.04 | 0.0% | Consolidated Statements of Operations (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | Change (%) | | :--------------- | :-------------- | :-------------- | :--------- | | Net sales | $1,010.4 | $1,057.2 | -4.4% | | Gross profit | $188.8 | $192.2 | -1.8% | | Operating income | $15.1 | $28.1 | -46.2% | | Net income (loss)| $(4.8) | $6.1 | -178.7% | | Basic EPS | $(0.14) | $0.17 | -182.4% | | Diluted EPS | $(0.14) | $0.17 | -182.4% | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net income and other comprehensive income components, leading to total comprehensive income or loss for the periods Consolidated Statements of Comprehensive Income (Loss) (Three Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------------- | :-------------- | :-------------- | | Net income (loss) | $1.5 | $1.6 | | Total other comprehensive income (loss) | $25.7 | $(1.6) | | Comprehensive income (loss) | $27.2 | $— | Consolidated Statements of Comprehensive Income (Loss) (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------------- | :-------------- | :-------------- | | Net income (loss) | $(4.8) | $6.1 | | Total other comprehensive income (loss) | $43.6 | $(14.1) | | Comprehensive income (loss) | $38.8 | $(8.0) | [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This statement provides a snapshot of the company's assets, liabilities, and stockholders' equity at specific reporting dates Consolidated Balance Sheets (As of June 30, 2025 and December 31, 2024) | Metric | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :--------------------------- | :----------------------- | :--------------------------- | | Cash and cash equivalents | $32.9 | $48.0 | | Accounts receivable, net | $289.6 | $260.3 | | Inventories - net | $782.5 | $609.4 | | Total current assets | $1,162.7 | $958.9 | | Total assets | $1,883.8 | $1,660.0 | | Accounts payable and accrued expenses | $469.2 | $389.4 | | Total current liabilities | $560.4 | $474.3 | | Long-term debt | $459.8 | $377.1 | | Total liabilities | $1,202.5 | $1,019.9 | | Total stockholders' equity | $681.3 | $640.1 | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes cash inflows and outflows from operating, investing, and financing activities for the specified periods Consolidated Statements of Cash Flows (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | Change (Millions) | | :-------------------------------------- | :-------------- | :-------------- | :---------------- | | Net cash used for operating activities | $(54.8) | $(19.6) | $(35.2) | | Net cash used for investing activities | $(29.5) | $(21.6) | $(7.9) | | Net cash provided by financing activities | $67.0 | $45.7 | $21.3 | | Net (decrease) increase in cash and cash equivalents | $(15.1) | $3.7 | $(18.8) | | Cash and cash equivalents at end of period | $32.9 | $38.1 | $(5.2) | [Condensed Consolidated Statements of Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) This statement outlines the changes in total stockholders' equity over the reporting periods Consolidated Statements of Equity (As of June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :------------------------- | :-------------- | :-------------- | | Total stockholders' equity | $681.3 | $592.3 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited condensed consolidated financial statements [1. Company and Basis of Presentation](index=7&type=section&id=1.%20Company%20and%20Basis%20of%20Presentation) This note describes the company's business, operational segments, and the basis for financial statement presentation - The Manitowoc Company, Inc. is a leading provider of engineered lifting products and services, founded in 1902 and headquartered in Milwaukee, Wisconsin, designing, manufacturing, marketing, distributing, and supporting product lines including mobile hydraulic cranes, lattice-boom crawler cranes, boom trucks, and tower cranes under various brand names[19](index=19&type=chunk) - The Company operates through three reportable segments: Americas (North and South America), Europe and Africa (EURAF, excluding the Middle East), and Middle East and Asia Pacific (MEAP, including Asia, Australia, and the Middle East)[20](index=20&type=chunk) [2. Recent Accounting Changes and Pronouncements](index=7&type=section&id=2.%20Recent%20Accounting%20Changes%20and%20Pronouncements) This note outlines recent accounting standard updates and their anticipated impact on the company's financial reporting - The FASB issued ASU No. 2023-09, 'Income Taxes (Topic 740): Improvements to Income Tax Disclosures,' effective for annual periods beginning after December 15, 2024, with no material impact expected on consolidated financial statements[23](index=23&type=chunk) - The FASB issued ASU No. 2024-03, 'Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 224-40): Disaggregation of Income Statement Expense,' effective for annual periods beginning after December 15, 2026, with the Company currently evaluating its impact[24](index=24&type=chunk) [3. Acquisition of Assets](index=8&type=section&id=3.%20Acquisition%20of%20Assets) This note provides details on the company's recent acquisition of assets, including the purchase price allocation - Effective February 4, 2025, the Company acquired certain assets and distribution rights in Georgia, North Carolina, and South Carolina from Ring Power Corporation for **$12.9 million in cash**[25](index=25&type=chunk) Purchase Price Allocation for Asset Acquisition | Asset Acquired | Amount (Millions) | | :------------------------ | :---------------- | | Inventory | $7.2 | | Intangible assets | $2.0 | | Property, plant, and equipment | $3.7 | | **Total Consideration** | **$12.9** | [4. Net Sales](index=8&type=section&id=4.%20Net%20Sales) This note provides details on customer advances and contract assets related to the company's net sales recognition Customer Advances Balance (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :----------------------------------------- | :-------------- | :-------------- | | Balance at beginning of period | $18.0 | $19.2 | | Cash received in advance | $65.4 | $63.5 | | Revenue recognized | $(61.1) | $(64.4) | | Currency translation | $1.4 | $(0.5) | | Balance at end of period | $23.7 | $17.8 | - Contract assets, representing unbilled service work, increased to **$11.1 million** as of June 30, 2025, from $8.8 million as of December 31, 2024[29](index=29&type=chunk) [5. Fair Value of Financial Instruments](index=8&type=section&id=5.%20Fair%20Value%20of%20Financial%20Instruments) This note discloses the fair value measurements of various financial instruments, categorized by valuation input levels Fair Value of Financial Instruments (As of June 30, 2025) | Instrument | Level 1 (Millions) | Level 2 (Millions) | Level 3 (Millions) | Total (Millions) | Recognized Location | | :----------------------- | :----------------- | :----------------- | :----------------- | :--------------- | :------------------------ | | FX Forward Contracts (Assets) | $— | $4.5 | $— | $4.5 | Other current assets | | Deferred Compensation Plan (Assets) | $8.8 | $— | $— | $8.8 | Other non-current assets | | FX Forward Contracts (Liabilities) | $— | $0.1 | $— | $0.1 | Accounts payable and accrued expenses | - The fair value of the **$300.0 million** senior secured second lien notes due October 1, 2031 (9.25% coupon) was approximately **$317.3 million** as of June 30, 2025, classified as Level 1[32](index=32&type=chunk)[33](index=33&type=chunk) [6. Derivative Financial Instruments](index=9&type=section&id=6.%20Derivative%20Financial%20Instruments) This note explains the company's use of derivative financial instruments, primarily FX forward contracts, for risk management - The Company uses FX Forward Contracts to manage exposure to non-functional currency transactions and transaction gains/losses, with aggregate notional amounts of **$69.6 million** as of June 30, 2025, down from $129.7 million as of December 31, 2024[37](index=37&type=chunk)[38](index=38&type=chunk) - Net unrealized gains (losses) on FX Forward Contracts recorded in AOCI, net of income tax, were **$3.1 million** as of June 30, 2025, compared to $(1.7) million as of December 31, 2024[38](index=38&type=chunk) Net Gains (Losses) from FX Forward Contracts in P&L (Three Months Ended June 30) | Category | Recognized Location | 2025 (Millions) | 2024 (Millions) | | :------------ | :------------------ | :-------------- | :-------------- | | Designated | Cost of sales | $1.5 | $(0.4) | | Non-Designated| Other income (expense) - net | $(1.8) | $0.9 | [7. Inventories](index=10&type=section&id=7.%20Inventories) This note provides a breakdown of the company's inventory components, including raw materials, work-in-process, and finished goods Inventory Components (As of June 30, 2025 and December 31, 2024) | Component | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :-------------- | :----------------------- | :--------------------------- | | Raw materials | $186.9 | $121.4 | | Work-in-process | $174.9 | $114.8 | | Finished goods | $420.7 | $373.2 | | **Total inventories** | **$782.5** | **$609.4** | [8. Property, Plant, and Equipment](index=10&type=section&id=8.%20Property,%20Plant,%20and%20Equipment) This note presents the net book value of property, plant, and equipment, including total cost and accumulated depreciation Property, Plant, and Equipment (As of June 30, 2025 and December 31, 2024) | Component | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :-------------------------- | :----------------------- | :--------------------------- | | Total cost | $926.9 | $871.4 | | Less accumulated depreciation | $(573.8) | $(525.2) | | **Property, plant, and equipment — net** | **$353.1** | **$346.2** | [9. Goodwill and Other Intangible Assets](index=10&type=section&id=9.%20Goodwill%20and%20Other%20Intangible%20Assets) This note provides information on goodwill and other intangible assets, including carrying amounts and impairment testing Goodwill Carrying Amount (Six Months Ended June 30, 2025) | Segment | Balance as of Dec 31, 2024 (Millions) | Foreign Currency Impact (Millions) | Balance as of June 30, 2025 (Millions) | | :----------- | :------------------------------------ | :--------------------------------- | :------------------------------------- | | Americas | $14.4 | $— | $14.4 | | MEAP | $63.4 | $1.2 | $64.6 | | **Consolidated** | **$77.8** | **$1.2** | **$79.0** | Other Intangible Assets (As of June 30, 2025 and December 31, 2024) | Type of Intangible Asset | June 30, 2025 Net Book Value (Millions) | December 31, 2024 Net Book Value (Millions) | | :----------------------- | :-------------------------------------- | :------------------------------------------ | | Definite lived intangible assets | $16.2 | $15.7 | | Indefinite-lived intangible assets | $110.9 | $102.8 | | **Total other intangible assets** | **$127.1** | **$118.5** | - The Company performs annual impairment tests for goodwill and indefinite-lived intangible assets in the fourth quarter and determined no triggering event occurred during the three and six months ended June 30, 2025[45](index=45&type=chunk)[46](index=46&type=chunk)[47](index=47&type=chunk) [10. Accounts Payable and Accrued Expenses](index=11&type=section&id=10.%20Accounts%20Payable%20and%20Accrued%20Expenses) This note itemizes the components of accounts payable and accrued expenses, including trade payables and employee-related costs Accounts Payable and Accrued Expenses (As of June 30, 2025 and December 31, 2024) | Component | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :---------------------------- | :----------------------- | :--------------------------- | | Trade accounts payable | $314.0 | $205.5 | | Employee-related expenses | $49.6 | $43.2 | | Accrued vacation | $29.1 | $23.3 | | Miscellaneous accrued expenses | $76.5 | $117.4 | | **Total accounts payable and accrued expenses** | **$469.2** | **$389.4** | [11. Debt](index=13&type=section&id=11.%20Debt) This note provides a comprehensive overview of the company's outstanding debt, including credit facilities and notes Outstanding Debt (As of June 30, 2025 and December 31, 2024) | Debt Type | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :---------------------------------------- | :----------------------- | :--------------------------- | | Borrowings under senior secured asset based revolving credit facility | $156.9 | $79.0 | | Senior secured second lien notes due 2031 | $300.0 | $300.0 | | Other debt | $18.4 | $16.4 | | Deferred financing costs | $(4.8) | $(5.2) | | **Total debt** | **$470.5** | **$390.2** | | Short-term borrowings and current portion of long-term debt | $(10.7) | $(13.1) | | **Long-term debt** | **$459.8** | **$377.1** | - The ABL Revolving Credit Facility was amended on September 18, 2024, increasing the aggregate commitment by **$50.0 million** to **$325.0 million** and extending the maturity date to September 18, 2029[52](index=52&type=chunk) - As of June 30, 2025, the Company was in compliance with all affirmative and negative covenants in its debt instruments, including the ABL Revolving Credit Facility and the 2031 Notes[58](index=58&type=chunk) [12. Accounts Receivable Factoring](index=14&type=section&id=12.%20Accounts%20Receivable%20Factoring) This note details the company's accounts receivable factoring activities and the cash proceeds generated from these sales - Cash proceeds from the factoring of accounts receivable qualifying as sales were **$119.4 million** for the six months ended June 30, 2025, an increase from $87.7 million for the same period in 2024[60](index=60&type=chunk) [13. Income Taxes](index=14&type=section&id=13.%20Income%20Taxes) This note outlines the provision or benefit for income taxes and discusses unrecognized tax benefits and recent tax legislation Provision (Benefit) for Income Taxes | Period | 2025 (Millions) | 2024 (Millions) | | :---------------------- | :-------------- | :-------------- | | Three months ended June 30 | $(0.2) | $1.6 | | Six months ended June 30 | $(2.7) | $3.5 | - Unrecognized tax benefits, excluding interest and penalties, increased to **$14.9 million** as of June 30, 2025, from $13.9 million as of December 31, 2024[64](index=64&type=chunk) - The Company is assessing the impact of the One Big Beautiful Bill Act (OBBBA), enacted on July 4, 2025, which includes significant tax-related provisions with earliest effective dates in 2025[65](index=65&type=chunk) [14. Net Income (Loss) Per Common Share](index=15&type=section&id=14.%20Net%20Income%20(Loss)%20Per%20Common%20Share) This note explains the calculation of basic and diluted net income (loss) per common share, including share counts Weighted Average Shares Outstanding (Six Months Ended June 30) | Share Type | 2025 | 2024 | | :--------------------------------------- | :----------- | :----------- | | Basic weighted average common shares outstanding | 35,363,682 | 35,316,971 | | Diluted weighted average common shares outstanding | 35,363,682 | 35,899,481 | - Due to a net loss incurred during the six months ended June 30, 2025, all equity instruments were anti-dilutive and excluded from diluted EPS calculations for that period[66](index=66&type=chunk) [15. Equity](index=15&type=section&id=15.%20Equity) This note provides information on stockholders' equity, including stock repurchase authorizations and accumulated other comprehensive loss - As of June 30, 2025, the Company had **$29.3 million** remaining under a Board authorization to purchase up to $35.0 million of common stock[68](index=68&type=chunk) Accumulated Other Comprehensive Loss (AOCI) (As of June 30) | Component | 2025 (Millions) | 2024 (Millions) | | :---------------------------- | :-------------- | :-------------- | | Balance at end of period | $(64.0) | $(100.5) | [16. Stock-Based Compensation](index=17&type=section&id=16.%20Stock-Based%20Compensation) This note describes the company's stock-based compensation plans, related expenses, and awards granted - The 2025 Omnibus Incentive Plan, approved on May 6, 2025, made **1.8 million shares** available for stock-based awards[73](index=73&type=chunk) - Stock-based compensation expense was **$6.0 million** for the six months ended June 30, 2025, up from $5.6 million in the prior year[78](index=78&type=chunk) - During the six months ended June 30, 2025, the Company granted **628,499 restricted stock units** and **437,969 performance shares** to employees[80](index=80&type=chunk)[81](index=81&type=chunk) [17. Segments](index=18&type=section&id=17.%20Segments) This note presents financial information by reportable segment, including net sales and operating income performance - The Company's three reportable segments are Americas, EURAF, and MEAP, with performance evaluated based on net sales and operating income[85](index=85&type=chunk)[86](index=86&type=chunk) Segment Net Sales (Three Months Ended June 30) | Segment | 2025 (Millions) | 2024 (Millions) | Change (%) | | :------ | :-------------- | :-------------- | :--------- | | Americas| $323.2 | $296.7 | 8.9% | | EURAF | $152.5 | $176.2 | -13.5% | | MEAP | $63.8 | $89.2 | -28.5% | | **Total** | **$539.5** | **$562.1** | **-4.0%** | Segment Operating Income (Loss) (Six Months Ended June 30) | Segment | 2025 (Millions) | 2024 (Millions) | Change (Millions) | | :------ | :-------------- | :-------------- | :---------------- | | Americas| $43.8 | $53.4 | $(9.6) | | EURAF | $(25.9) | $(18.6) | $(7.3) | | MEAP | $21.2 | $17.5 | $3.7 | Net Sales by Product Type (Six Months Ended June 30) | Product Type | 2025 (Millions) | 2024 (Millions) | Change (%) | | :---------------- | :-------------- | :-------------- | :--------- | | New machine sales | $688.2 | $764.7 | -10.0% | | Non-new machine sales | $322.2 | $292.5 | 10.2% | | **Total net sales** | **$1,010.4** | **$1,057.2** | **-4.4%** | [18. Commitments and Contingencies](index=20&type=section&id=18.%20Commitments%20and%20Contingencies) This note discloses the company's commitments and contingencies, including product liability reserves and legal settlements - Current and long-term product liability reserves increased to **$2.1 million** and **$6.5 million**, respectively, as of June 30, 2025, from $1.4 million and $5.0 million as of December 31, 2024[95](index=95&type=chunk) - On March 28, 2025, the Company paid a civil penalty of **$42.6 million** (plus $0.6 million interest) and is implementing an emissions mitigation project as part of a Consent Decree with the U.S. regarding alleged Clean Air Act violations[97](index=97&type=chunk) [19. Guarantees](index=20&type=section&id=19.%20Guarantees) This note provides information on the company's guarantees, including buyback commitments and warranty reserves - Total buyback commitments outstanding increased to **$31.6 million** as of June 30, 2025, from $29.9 million as of December 31, 2024[99](index=99&type=chunk) - Warranty and other warranty related work reserves increased to **$47.6 million** as of June 30, 2025, from $45.3 million as of December 31, 2024[101](index=101&type=chunk) Warranty and Other Warranty Related Work (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------------- | :-------------- | :-------------- | | Balance at beginning of period | $45.3 | $56.8 | | Adjustments to accruals for warranties | $20.2 | $9.1 | | Settlements made | $(20.4) | $(16.9) | | Currency translation | $2.5 | $(0.8) | | **Balance at end of period** | **$47.6** | **$48.2** | [20. Employee Benefit Plans](index=21&type=section&id=20.%20Employee%20Benefit%20Plans) This note outlines the net periodic benefit cost for the company's U.S. and non-U.S. pension and postretirement plans Net Periodic Benefit Cost (Income) (Six Months Ended June 30, 2025) | Component | U.S. Pension Plans (Millions) | Non-U.S. Pension Plans (Millions) | Postretirement Health and Other Plans (Millions) | | :-------------------------------------- | :---------------------------- | :-------------------------------- | :----------------------------------------------- | | Service cost | $— | $0.6 | $— | | Interest cost | $2.5 | $1.2 | $0.1 | | Expected return on plan assets | $(2.2) | $(0.9) | $— | | Amortization of actuarial net (gain) loss | $0.6 | $0.2 | $(0.8) | | **Net periodic benefit cost (income)** | **$0.9** | **$1.1** | **$(0.7)** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial performance, condition, and results of operations for the three and six months ended June 30, 2025, compared to the prior year. It covers key financial metrics, segment performance, liquidity, and non-GAAP measures, alongside cautionary statements regarding forward-looking information and current events impacting the business [Cautionary Statements Regarding Forward-Looking Information](index=23&type=section&id=Cautionary%20Statements%20Regarding%20Forward-Looking%20Information) This section highlights the inherent risks and uncertainties that could cause actual results to differ from forward-looking statements - Forward-looking statements are subject to known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially, including macroeconomic conditions (inflation, interest rates, tariffs), competitor actions, changes in economic/industry conditions, geopolitical events, customer demand, backlog conversion, adverse trade policy, and high debt leverage[111](index=111&type=chunk)[114](index=114&type=chunk) [Current Events](index=24&type=section&id=Current%20Events) This section discusses recent events, including U.S. government tariffs and their potential impact on the company's operations - Starting in early 2025, the U.S. government announced reciprocal tariffs, followed by a 90-day suspension and implementation of a **10% tariff** on most imports (higher for China), with non-binding trade deals announced with countries like the EU, Japan, and the UK[115](index=115&type=chunk) - Approximately **50% of the Company's net sales** are generated in the United States, and tariffs may affect demand, raise product costs, or disrupt the supply chain, with the Company assessing the impact and mitigation measures[116](index=116&type=chunk) [Orders and Backlog](index=25&type=section&id=Orders%20and%20Backlog) This section provides an overview of the company's order intake and total backlog, including changes and influencing factors Orders and Backlog Performance | Metric | Three Months Ended June 30, 2025 (Millions) | Three Months Ended June 30, 2024 (Millions) | Change (%) | | :----------------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Orders | $453.9 | $428.4 | 6.0% | | | | | | | Metric | Six Months Ended June 30, 2025 (Millions) | Six Months Ended June 30, 2024 (Millions) | Change (%) | | :----------------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Orders | $1,064.2 | $982.5 | 8.3% | | | | | | | Metric | As of June 30, 2025 (Millions) | As of December 31, 2024 (Millions) | Change (%) | | :----------------------------------- | :------------------------------------------ | :------------------------------------------ | :--------- | | Total backlog | $729.3 | $650.2 | 12.2% | - The increase in orders was primarily driven by higher demand in the Americas segment and for tower product offerings in the EURAF segment, favorably impacted by foreign currency exchange rates by **$8.6 million** (3 months) and **$2.7 million** (6 months)[118](index=118&type=chunk)[119](index=119&type=chunk) - Total backlog as of June 30, 2025, increased **12.2%** from December 31, 2024, but decreased **12.8%** from June 30, 2024, with foreign currency exchange rates favorably impacting backlog by **$26.6 million** (vs. Dec 31, 2024) and **$20.8 million** (vs. June 30, 2024)[120](index=120&type=chunk) [Results of Operations For The Three and Six Months Ended June 30, 2025 and 2024](index=25&type=section&id=Results%20of%20Operations%20For%20The%20Three%20and%20Six%20Months%20Ended%20June%2030,%202025%20and%202024) This section analyzes the company's financial performance for the three and six months ended June 30, 2025 and 2024 [Net Sales](index=25&type=section&id=Net%20Sales) This section analyzes the drivers behind changes in consolidated net sales for the reported periods - Consolidated net sales decreased **4.0%** to **$539.5 million** for the three months ended June 30, 2025, primarily due to lower new machine sales in EURAF (mobile product line) and MEAP, partially offset by higher new machine sales in Americas and higher non-new machine sales[123](index=123&type=chunk) - Consolidated net sales decreased **4.4%** to **$1,010.4 million** for the six months ended June 30, 2025, driven by lower new machine sales in EURAF (mobile), MEAP, and Americas, partially offset by higher tower crane sales in EURAF and higher non-new machine sales[124](index=124&type=chunk)[125](index=125&type=chunk) [Gross Profit](index=27&type=section&id=Gross%20Profit) This section examines the company's gross profit and gross profit percentage, highlighting factors influencing changes - Gross profit for the three months ended June 30, 2025, remained flat at **$99.0 million**, with the gross profit percentage increasing to **18.4%** from 17.7% in 2024, primarily due to favorable product mix offsetting lower sales and absorbed costs[126](index=126&type=chunk)[127](index=127&type=chunk) - Gross profit for the six months ended June 30, 2025, decreased **1.8%** to **$188.8 million**, while the gross profit percentage increased to **18.7%** from 18.2% in 2024, driven by similar factors as the three-month period[128](index=128&type=chunk)[129](index=129&type=chunk) [Engineering, Selling, and Administrative Expenses](index=27&type=section&id=Engineering,%20Selling,%20and%20Administrative%20Expenses) This section details the changes in engineering, selling, and administrative expenses and their primary causes - Engineering, selling, and administrative expenses increased **4.4%** to **$87.4 million** for the three months ended June 30, 2025, and **6.6%** to **$170.3 million** for the six months, primarily due to costs for the triennial bauma trade show, higher employee-related costs, and new product development costs, partially offset by a prior-year EPA legal charge[130](index=130&type=chunk)[131](index=131&type=chunk) [Interest Expense](index=27&type=section&id=Interest%20Expense) This section analyzes the company's interest expense, noting the impact of interest rates on borrowings - Interest expense decreased to **$9.2 million** for the three months ended June 30, 2025 (from $9.6 million), and to **$17.9 million** for the six months (from $18.8 million), primarily due to lower interest rates on ABL revolving credit facility borrowings[132](index=132&type=chunk)[133](index=133&type=chunk) [Other Income (Expense) - Net](index=27&type=section&id=Other%20Income%20(Expense)%20-%20Net) This section reviews the components of other income (expense) - net, including currency gains/losses and pension costs - Other income was **$1.0 million** for the three months ended June 30, 2025 (vs. $0.3 million in 2024), driven by currency gains, partially offset by pension costs and EPA settlement interest[134](index=134&type=chunk) - Other income (expense) - net was **$(4.0) million** for the six months ended June 30, 2025 (vs. $1.0 million income in 2024), primarily due to currency loss, pension costs, and EPA settlement interest[135](index=135&type=chunk) [Provision (Benefit) for Income Taxes](index=29&type=section&id=Provision%20(Benefit)%20for%20Income%20Taxes) This section explains the provision or benefit for income taxes, considering jurisdictional mix and pre-tax income/loss - The Company recorded an income tax benefit of **$0.2 million** for the three months and **$2.7 million** for the six months ended June 30, 2025, compared to provisions of $1.6 million and $3.5 million, respectively, in 2024, due to changes in jurisdictional mix and a year-to-date loss before income taxes[136](index=136&type=chunk) [Segment Operating Performance](index=29&type=section&id=Segment%20Operating%20Performance) This section provides a detailed analysis of net sales and operating income for each reportable segment Segment Net Sales and Operating Income (Three Months Ended June 30) | Segment | Net Sales 2025 (Millions) | Net Sales 2024 (Millions) | Net Sales Change (%) | Operating Income (Loss) 2025 (Millions) | Operating Income (Loss) 2024 (Millions) | Operating Income (Loss) Change (%) | | :------- | :------------------------ | :------------------------ | :------------------- | :-------------------------------------- | :-------------------------------------- | :--------------------------------- | | Americas | $323.2 | $296.7 | 8.9% | $26.1 | $23.9 | 9.2% | | EURAF | $152.5 | $176.2 | (13.5)% | $(14.6) | $(6.8) | * | | MEAP | $63.8 | $89.2 | (28.5)% | $9.8 | $9.3 | 5.4% | Segment Net Sales and Operating Income (Six Months Ended June 30) | Segment | Net Sales 2025 (Millions) | Net Sales 2024 (Millions) | Net Sales Change (%) | Operating Income (Loss) 2025 (Millions) | Operating Income (Loss) 2024 (Millions) | Operating Income (Loss) Change (%) | | :------- | :------------------------ | :------------------------ | :------------------- | :-------------------------------------- | :-------------------------------------- | :--------------------------------- | | Americas | $582.5 | $579.9 | 0.4% | $43.8 | $53.4 | (18.0)% | | EURAF | $298.1 | $319.2 | (6.6)% | $(25.9) | $(18.6) | * | | MEAP | $129.8 | $158.1 | (17.9)% | $21.2 | $17.5 | 21.1% | - Americas net sales increased **8.9%** for Q2 2025 due to higher new machine sales (favorable product mix) and non-new machine sales (used cranes), with operating income increasing **9.2%** due to higher sales and favorable product mix, despite lower absorbed costs[139](index=139&type=chunk)[140](index=140&type=chunk) - EURAF net sales decreased **13.5%** for Q2 2025 due to lower mobile crane sales, partially offset by higher tower crane and non-new machine sales, resulting in an operating loss increase of **$7.8 million** due to lower net sales and higher engineering, selling, and administrative expenses[143](index=143&type=chunk)[144](index=144&type=chunk) - MEAP net sales decreased **28.5%** for Q2 2025 due to lower new machine sales (unfavorable product mix) and non-new machine sales, with operating income remaining flat due to product mix[147](index=147&type=chunk)[148](index=148&type=chunk) [Financial Condition](index=30&type=section&id=Financial%20Condition) This section assesses the company's financial position, including cash flows, liquidity, capital resources, and debt structure [Cash Flows](index=30&type=section&id=Cash%20Flows) This section analyzes the company's cash flows from operating, investing, and financing activities Summary of Cash Flows (Six Months Ended June 30) | Cash Flow Activity | 2025 (Millions) | 2024 (Millions) | Dollar Change (Millions) | | :---------------------------------- | :-------------- | :-------------- | :----------------------- | | Net cash used for operating activities | $(54.8) | $(19.6) | $(35.2) | | Net cash used for investing activities | $(29.5) | $(21.6) | $(7.9) | | Net cash provided by financing activities | $67.0 | $45.7 | $21.3 | | Cash and cash equivalents | $32.9 | $38.1 | $(5.2) | - Net cash used for operating activities increased by **$35.2 million**, primarily due to lower net income (adjusted for non-cash items) and **$24.5 million** higher cash outflows related to net working capital, driven by increases in accounts receivable, other assets, and inventory[151](index=151&type=chunk) - Net cash used for investing activities increased by **$7.9 million**, mainly due to **$12.9 million** for asset acquisition from Ring Power Corporation and lower proceeds from asset sales, partially offset by lower capital expenditures[152](index=152&type=chunk)[153](index=153&type=chunk) - Net cash provided by financing activities increased by **$21.3 million**, primarily due to **$24.5 million** of additional net borrowings under the revolving credit facility[154](index=154&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) This section evaluates the company's liquidity position and its ability to meet short-term and long-term financial obligations Liquidity Position (As of June 30, 2025 and December 31, 2024) | Metric | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :-------------------------- | :----------------------- | :--------------------------- | | Cash and cash equivalents | $32.9 | $48.0 | | Revolver borrowing capacity | $325.0 | $325.0 | | Other debt availability | $47.8 | $42.4 | | Less: Borrowings on revolver | $(156.9) | $(79.0) | | Less: Borrowings on other debt | $(7.8) | $(12.1) | | Less: Outstanding letters of credit | $(3.4) | $(3.4) | | **Total liquidity** | **$237.6** | **$320.9** | - The Company believes its liquidity and expected cash flows from operations are sufficient to meet operational needs for the next twelve months[155](index=155&type=chunk) - The ABL Revolving Credit Facility has a maximum availability of **$325.0 million**, with **$100.0 million** available to the German subsidiary, and matures on September 18, 2029[157](index=157&type=chunk) [Debt](index=33&type=section&id=Debt) This section provides an overview of the company's outstanding debt and compliance with debt covenants Outstanding Debt (As of June 30, 2025 and December 31, 2024) | Debt Type | June 30, 2025 (Millions) | December 31, 2024 (Millions) | | :---------------------------------------- | :----------------------- | :--------------------------- | | Borrowings under senior secured asset based revolving credit facility | $156.9 | $79.0 | | Senior secured second lien notes due 2031 | $300.0 | $300.0 | | Other debt | $18.4 | $16.4 | | Deferred financing costs | $(4.8) | $(5.2) | | **Total debt** | **$470.5** | **$390.2** | | Short-term borrowings and current portion of long-term debt | $(10.7) | $(13.1) | | **Long-term debt** | **$459.8** | **$377.1** | - As of June 30, 2025, the Company was in compliance with all debt covenants and expects to remain compliant for the subsequent twelve months[160](index=160&type=chunk) [Non-GAAP Measures](index=33&type=section&id=Non-GAAP%20Measures) This section presents and reconciles non-GAAP financial measures, including Adjusted ROIC, EBITDA, and Free Cash Flows [Adjusted ROIC](index=34&type=section&id=Adjusted%20ROIC) This section defines and calculates Adjusted Return on Invested Capital (ROIC), a key non-GAAP performance metric - Adjusted ROIC, a non-GAAP measure, was **4.2%** as of June 30, 2025, calculated by dividing Adjusted NOPAT for the trailing twelve months by the five-quarter average of invested capital[162](index=162&type=chunk)[163](index=163&type=chunk)[164](index=164&type=chunk) Adjusted NOPAT (Trailing Twelve Months Ended June 30, 2025) | Metric | Amount (Millions) | | :-------------------------- | :---------------- | | Operating income | $38.8 | | Amortization of intangible assets | $3.0 | | Restructuring expense | $3.5 | | Other non-recurring items - net | $3.6 | | Adjusted operating income | $48.9 | | Provision for income taxes | $(7.3) | | **Adjusted NOPAT** | **$41.6** | Invested Capital (5-Quarter Average Ended June 30, 2025) | Metric | Amount (Millions) | | :-------------------------- | :---------------- | | Net total assets | $634.6 | | Cash and cash equivalents | $(36.7) | | Short-term borrowings and current portion of long-term debt | $20.7 | | Long-term debt | $410.3 | | Income tax assets - net | $(43.8) | | **Invested capital** | **$985.1** | [EBITDA and Adjusted EBITDA](index=34&type=section&id=EBITDA%20and%20Adjusted%20EBITDA) This section defines and reconciles EBITDA and Adjusted EBITDA, providing insights into operational profitability - EBITDA is defined as net income (loss) before interest, taxes, depreciation, and amortization, with Adjusted EBITDA further adjusting for restructuring expense, other income (expense) - net, and certain other non-recurring items[167](index=167&type=chunk) EBITDA and Adjusted EBITDA (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------- | :-------------- | :-------------- | | Net income (loss) | $(4.8) | $6.1 | | Interest expense and amortization of deferred financing fees | $18.6 | $19.5 | | Provision (benefit) for income taxes | $(2.7) | $3.5 | | Depreciation expense | $29.5 | $29.3 | | Amortization of intangible assets | $1.6 | $1.5 | | **EBITDA** | **$42.2** | **$59.9** | | Restructuring expense | $1.8 | $2.9 | | Other non-recurring items - net | $— | $5.5 | | Other (income) expense - net | $4.0 | $(1.0) | | **Adjusted EBITDA** | **$48.0** | **$67.3** | | Adjusted EBITDA margin percentage | 4.8% | 6.4% | [Free Cash Flows](index=35&type=section&id=Free%20Cash%20Flows) This section defines and calculates free cash flows, indicating the cash available after capital expenditures - Free cash flows are defined as net cash used for operating activities less cash outflow from capital expenditures[170](index=170&type=chunk) Free Cash Flows (Six Months Ended June 30) | Metric | 2025 (Millions) | 2024 (Millions) | | :-------------------------------- | :-------------- | :-------------- | | Net cash used for operating activities | $(54.8) | $(19.6) | | Capital expenditures | $(16.8) | $(25.1) | | **Free cash flows** | **$(71.6)** | **$(44.7)** | [Critical Accounting Policies](index=35&type=section&id=Critical%20Accounting%20Policies) This section confirms that there have been no material changes to the company's critical accounting policies - The Company's critical accounting policies have not materially changed since the 2024 Annual Report on Form 10-K[172](index=172&type=chunk) [Item 3. Quantitative and Qualitative Disclosure about Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) This section states that there have been no material changes to the Company's market risk disclosures since its 2024 Annual Report on Form 10-K - The Company's market risk disclosures have not materially changed since the 2024 Annual Report on Form 10-K[173](index=173&type=chunk) [Item 4. Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the Company's disclosure controls and procedures and states that there have been no material changes to its internal control over financial reporting - The Company's management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of June 30, 2025[174](index=174&type=chunk) - No changes have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting during the period covered by this report[175](index=175&type=chunk) PART II. OTHER INFORMATION This section includes updates on risk factors, other relevant information, and a comprehensive list of exhibits filed with the report [Item 1A. Risk Factors](index=36&type=section&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K - There have been no material changes to the risk factors previously disclosed in Part I, Item 1A, 'Risk Factors,' in the Company's Annual Report on Form 10-K for the year ended December 31, 2024[178](index=178&type=chunk) [Item 5. Other Information](index=36&type=section&id=Item%205.%20Other%20Information) This section reports on Rule 10b5-1 trading arrangements by directors and Section 16 officers - No director or Section 16 officer adopted a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the three months ended June 30, 2025[179](index=179&type=chunk) [Item 6. Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed or furnished with the Quarterly Report on Form 10-Q List of Exhibits | Exhibit No. | Description | Filed/Furnished Herewith | | :---------- | :------------------------------------------------------------------------------------------------------ | :----------------------- | | 31 | Rule 13a - 14(a)/15d - 14(a) Certifications | X | | 32.1 | Certification of CEO pursuant to 18 U.S.C. Section 1350 | X | | 32.2 | Certification of CFO pursuant to 18 U.S.C. Section 1350 | X | | 101.INS | Inline XBRL Instance Document | X | | 101.SCH | Inline XBRL Taxonomy Extension Schema Document | X | | 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | X | | 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | X | | 101.LAB | Inline XBRL Taxonomy Extension Labels Linkbase Document | X | | 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | X | | 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | X |

Financial Data and Key Metrics Changes - The company generated $540 million in revenue for Q2 2025, a decrease of 4% year over year [21] - Adjusted EBITDA was $26 million, down $10 million year over year [22] - Orders totaled $454 million, an increase of 6% from the previous year, resulting in a backlog of $729 million [20] - Non-new machine sales were $162 million, up 10% year over year [22] - The net leverage ratio increased to approximately four times, with a focus on bringing it back below three times by year-end [25] Business Line Data and Key Metrics Changes - The European Tower Crane business saw new machine orders up 104% year over year [20] - Non-new machine sales reached a record $659 million on a trailing twelve-month basis [22] - The MGX distribution business experienced higher orders as end customers locked in pricing on in-stock units [21] Market Data and Key Metrics Changes - In Europe, demand varied by country, with slow demand in the UK, Netherlands, and France, while Spain, Italy, and Germany showed signs of optimism [8] - The Middle East market is experiencing dynamic growth, particularly in Saudi Arabia and UAE, with significant infrastructure projects underway [12] - In Asia, China faces economic headwinds, while Korea shows improving sentiment due to pro-business initiatives [13] Company Strategy and Development Direction - The company continues to execute its Cranesville 50 strategy, focusing on strengthening its aftermarket business and enhancing customer service [26] - A new service branch was opened in Warsaw, Poland, and expansions occurred in Sydney, Australia, Nantes, France, and Nashville [26] - The company is transitioning from a product-focused to a customer-oriented culture, enhancing its service capabilities [27] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about long-term demand despite current uncertainties around tariffs and pricing [15] - The company anticipates a drag on demand in the U.S. due to significant uncertainty around tariffs, leading to delayed purchasing decisions [15] - Management expects to achieve the low end of previously issued adjusted EBITDA guidance of $120 million to $145 million for the full year [25] Other Important Information - The company achieved a recordable injury rate of 0.67 for the first half of the year, reflecting ongoing safety improvements [7] - The full-year gross impact of tariffs is now estimated at $35 million, with plans to mitigate 90% of these costs [5] Q&A Session Summary Question: What is the expected duration of the backlog and EBITDA cadence for the next quarters? - Most of the backlog is expected to ship this year, with Q4 typically being stronger than Q3 [33] Question: How do regional dynamics affect orders? - The Americas show mixed results, with strong demand in the MGX distribution business but challenges in the dealer-oriented legacy business [34] Question: What is the impact of tariffs on pricing and demand? - The company is experiencing a 15% tariff on certain products, leading to cautious purchasing behavior among customers [44][46] Question: How is the company offsetting the tariff impacts? - The company is implementing price increases to mitigate the tariff impacts [48] Question: What adjustments are being made to protect cash flow? - The company is adjusting build schedules based on backlog and order trends to avoid overwhelming the supply chain [65]

Financial Performance - Q2 2025 - Net sales reached $540 million[17] - Adjusted EBITDA was $26 million[17] - Orders totaled $454 million[17] - Non-new machine sales increased by 10% year-over-year, reaching $162 million[13] Market Conditions - North America is experiencing a market on hold due to tariff-related uncertainty, but with high fleet utilization and declining dealer inventory[20] - Asia Pacific is seeing prolonged weakness in China, but improving sentiment in South Korea and mixed results in Australia[20] - Europe has varying market sentiment depending on the country, with new government stimulus programs and increasing residential permits[20] - The Middle East shows robust market demand driven by major residential, data center, and stadium project activity[20] Full Year 2025 Guidance - Net sales are projected to be between $2.175 billion and $2.275 billion[47] - Adjusted EBITDA is expected to be between $120 million and $145 million[47] - Capital expenditures are estimated at $47 million, with $23 million related to the rental fleet[47] - Adjusted free cash flows are projected to be between $55 million and $85 million, excluding EPA payment[47]

Core Insights - Manitowoc reported significant earnings and revenue misses in Q2 2025, with Non-GAAP EPS at $0.08 compared to expectations of $0.18, reflecting ongoing market and operational pressures [1][5] - Adjusted EBITDA decreased to $26.3 million from $36.0 million year-over-year, indicating margin compression and cash flow challenges despite a 6.0% rise in new orders [1][5][6] Financial Performance - Non-GAAP EPS fell 68% year-over-year from Q2 2024, missing estimates by $0.10 [2][5] - Revenue decreased by 4.0% year-over-year to $539.5 million, falling short of analyst estimates by 7.8% [2][5] - Adjusted EBITDA dropped 26.9% from the previous year [2][5] - Free cash flow turned negative at $(73.7 million), compared to $(1.9 million) in Q2 2024 [2][5] Business Overview - Manitowoc designs and manufactures a variety of lifting equipment for the global construction industry, including mobile cranes, tower cranes, and boom trucks [3] - The company emphasizes aftermarket services for crane maintenance and technical support [3] Geographic Segmentation - Manitowoc operates in three key geographic segments: the Americas, Europe and Africa (EURAF), and the Middle East and Asia Pacific (MEAP) [4] - The company focuses on operational efficiency, product innovation, and expanding aftermarket services to stabilize revenue [4] Market Dynamics - Despite revenue declines, new orders increased by 6.0% to $453.9 million, with notable strength in the European tower crane market due to government infrastructure spending [6] - The order backlog decreased from $797.8 million at the end of Q1 to $729.3 million at the end of Q2 2025, indicating a cautious outlook [6] Product Development - The company continues to focus on enhancing product performance, with positive feedback on hybrid all-terrain cranes [7] - Aftermarket services grew by 9.7% year-over-year to $161.6 million, providing a stabilizing factor for revenue [7] Operational Challenges - Inventory increased by 28% since year-end, reaching $782.5 million, contributing to negative cash flow [9] - Management expects to finish fiscal 2025 at the low end of guidance, with ongoing profitability challenges highlighted by an adjusted return on invested capital of 4.2% [10] Future Outlook - Key areas to monitor include the conversion of backlog into revenue, tariff mitigation impacts, inventory reduction efforts, and growth in aftermarket services [11]

Group 1 - The Manitowoc Company, Inc. (NYSE: MTW) has shown a significant recovery in its stock performance over the last few months after experiencing a notable decline earlier in the year [1] - Crude Value Insights focuses on cash flow and companies in the oil and natural gas sector, highlighting their value and growth prospects [1] Group 2 - Subscribers to Crude Value Insights benefit from a stock model account with over 50 stocks, detailed cash flow analyses of exploration and production firms, and live discussions about the sector [2] - A two-week free trial is available for new subscribers to explore the offerings related to oil and gas investments [3]