Financial Performance - The company reported Q1 earnings per share of $0.83 on sales of $1.2 billion, with a return on invested capital of 15% [7][24] - Total net sales decreased by 4.9% year-over-year, or 3.6% at constant exchange rates, with organic sales excluding ESG declining by 25% [24][26] - The operating margin for the Environmental Solutions segment was 19.4%, while the overall operating margin was 9.1%, reflecting a decline of 350 basis points year-over-year [25][31] Business Line Performance - Aerials segment sales were $450 million, with operating margins slightly improving sequentially but down from the previous year [27] - Materials Processing (MP) sales were $382 million, maintaining double-digit margins despite lower volume due to cost reduction actions [29] - Environmental Solutions (ES) generated approximately $400 million in sales, representing a third of total sales, with strong performance attributed to record throughput [31] Market Data - Approximately 75% of the company's 2025 U.S. machine sales are expected to come from products manufactured in the U.S., enhancing resilience against tariffs [9][10] - The company noted a generally weak economic environment in Europe but sees potential growth in infrastructure spending in the medium to long term [17] Company Strategy and Industry Competition - The company is focused on integrating ESG into its operations, expecting to deliver over $25 million in operational synergies by the end of 2026 [18][19] - The company aims to maintain price-cost neutrality while mitigating tariff impacts through supply chain adjustments and strategic sourcing [14][53] Management Commentary on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the operating environment, highlighting the need to navigate macroeconomic uncertainties and potential tariff impacts [36][37] - The full-year sales outlook remains between $5.3 billion and $5.5 billion, with expectations of a significant increase in free cash flow compared to 2024 [37][39] Other Important Information - The company ended Q1 with $1.1 billion in liquidity and plans to deleverage in the second half of the year [33] - The current backlog stands at $2.6 billion, up 13% sequentially, indicating strong demand across segments [35] Q&A Session Summary Question: Can you expand on the margin outlook for Environmental Solutions? - Management indicated that strong Q1 performance was driven by increased sales and favorable factory adoption, but expects moderation in margins going forward due to one-off factors and increased expenses [46][47][116] Question: How are you handling orders in the current tariff environment? - The company is in full mitigation mode, having pulled forward material and implemented surcharges where necessary, while maintaining price-cost neutrality as a priority [52][53] Question: What is the impact of tariffs on your manufacturing footprint? - The company highlighted that a significant portion of its products are manufactured in the U.S., providing a competitive advantage in the current tariff landscape [63][64] Question: Can you provide insights on the backlog growth in Materials Processing? - Management noted that the backlog growth is consistent with historical patterns and driven by healthy fleet utilization and replacement demand in North America [120][121]

Group 1: Earnings Performance - Terex reported quarterly earnings of $0.83 per share, exceeding the Zacks Consensus Estimate of $0.49 per share, but down from $1.60 per share a year ago, representing an earnings surprise of 69.39% [1] - The company has surpassed consensus EPS estimates in all four of the last quarters [2] - Terex's revenues for the quarter ended March 2025 were $1.23 billion, surpassing the Zacks Consensus Estimate by 0.64%, but down from $1.29 billion year-over-year [2] Group 2: Stock Performance and Outlook - Terex shares have declined approximately 21.3% since the beginning of the year, compared to a decline of 4.7% for the S&P 500 [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters [4] - The current consensus EPS estimate for the next quarter is $1.47 on revenues of $1.43 billion, and for the current fiscal year, it is $4.49 on revenues of $5.29 billion [7] Group 3: Industry Context - The Manufacturing - Construction and Mining industry, to which Terex belongs, is currently ranked in the top 6% of over 250 Zacks industries, indicating strong performance potential [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Terex's stock performance [5][6]

Financial Performance - The company reported Q1 earnings per share of $0.83 on sales of $1.2 billion, with a return on invested capital of 15% [6][23] - Total net sales decreased by 4.9% year-over-year, or 3.6% at constant exchange rates, with organic sales excluding ESG declining by 25% [23][35] - The operating margin for the overall company was 9.1%, down 350 basis points from the prior year, but showed a sequential improvement of 130 basis points from Q4 2024 [24][30] Business Line Performance - Aerials segment sales were $450 million, with operating margins down 3% year-over-year but expected to return to double digits in Q2 due to seasonal demand [26][36] - Materials Processing (MP) sales were $382 million, maintaining double-digit margins despite lower volume, with expectations for sequential improvement throughout the year [27][36] - Environmental Solutions (ES) generated approximately $400 million in sales, representing a third of total sales, with an operating margin of 19.4%, showing strong performance and record throughput [29][30] Market Data - Approximately 75% of the company's 2025 U.S. machine sales are expected to come from products manufactured in the U.S., enhancing resilience against tariffs [8][10] - The company noted a generally weak economic environment in Europe but sees potential growth in infrastructure spending in the medium to long term [15][16] Company Strategy and Industry Competition - The company is focused on integrating ESG into its operations, expecting to deliver over $25 million in operational run rate synergies by the end of 2026 [17][38] - The company is leveraging its global sourcing capabilities to mitigate tariff impacts and maintain price-cost neutrality [13][50] - The company is optimistic about its position in the market, particularly in the U.S. and North America, where a significant portion of its products are manufactured [60] Management Commentary on Operating Environment and Future Outlook - Management expressed caution regarding the macroeconomic environment and geopolitical uncertainties but maintained a full-year EPS outlook of $4.7 to $5.1 [7][35] - The company anticipates a gradual recovery in MP driven by replacement demand in North America, with a focus on maintaining operational efficiency [36][118] Other Important Information - The company ended Q1 with $1.1 billion in liquidity and plans to deleverage in the second half of the year while continuing to invest in growth [31][32] - The company repurchased $32 million of its stock and paid $11 million in dividends during the first quarter [32] Q&A Session Summary Question: Margin outlook for Environmental Solutions - Management noted that strong Q1 performance was driven by increased sales, record throughput, and integration synergies, but expects moderation in margins going forward due to one-off items and increased expenses [41][44][46] Question: Handling of orders and tariff assumptions - Management confirmed they are in mitigation mode regarding tariffs, having pulled forward inventory and implemented surcharges where necessary, while maintaining price-cost neutrality [47][49][50] Question: Guidance dynamics and competitive advantage - Management explained that the Q1 performance exceeded expectations, and while tariffs are a concern, the majority of products are manufactured in the U.S., providing a competitive edge [53][59] Question: Aerials and Material Processing margin progression - Management indicated that Aerials are expected to see a seasonal ramp-up in Q2, with MP showing a gradual recovery driven by replacement demand [63][66][68] Question: Impact of tariffs on the UK and pricing strategies - Management acknowledged the impact of tariffs on raw materials from China and indicated that pricing strategies would be adjusted as necessary to maintain competitiveness [79][82] Question: Sustainability of ES margins - Management expressed confidence in the sustainability of ES margins due to strong demand and expected synergies from the ESG acquisition [84][86] Question: Clarification on tariff assumptions - Management clarified that the $0.40 tariff impact assumption includes expected easing of China tariffs, with a focus on maintaining competitive pricing [91][92] Question: Impact of Germany's stimulus plan - Management noted that while the stimulus plan in Germany is not included in current sales outlook, it could positively impact the Material Processing segment in the future [93][94]

Financial Performance - Q1 2025 sales reached $1.229 billion, a 4.9% decrease compared to $1.292 billion in Q1 2024[23] - Adjusted operating margin for Q1 2025 was 9.1%[12, 23] - Adjusted EPS for Q1 2025 was $0.83[12, 24] - The company is maintaining its 2025 FY EPS outlook of $4.70 - $5.10[13] Segment Performance - Aerials sales in Q1 2025 were $450 million, a 27.8% year-over-year decrease[28] with an operating margin of 3.0%[28] - MP (Material Processing) sales in Q1 2025 were $382 million, a 26.5% year-over-year decrease[32] with an operating margin of 10.0%[32] - ES (Environmental Solutions) sales in Q1 2025 were $399 million, a 10.5% year-over-year increase[35] with an operating margin of 19.4%[35] Strategic Initiatives and Outlook - The company's backlog stands at $2.6 billion[39] - The company anticipates net sales between $5.3 billion and $5.5 billion for 2025[44] - The company anticipates segment operating margin of approximately 12% for 2025[44]

Financial Performance - Terex reported Q1 2025 sales of $1.2 billion, with an operating margin of 5.6% and adjusted operating margin of 9.1%[5]. - The company achieved EPS of $0.31 and adjusted EPS of $0.83, compared to $1.60 and $1.74 in Q1 2024 respectively[6]. - Net sales for Q1 2025 were $1,229 million, a decrease of 4.9% compared to $1,292 million in Q1 2024[30]. - Gross profit for Q1 2025 was $230 million, representing a gross margin of 18.7%, down from 23.0% in Q1 2024[35]. - Operating profit decreased to $69 million in Q1 2025, with an operating margin of 5.6%, compared to $158 million and 12.2% in Q1 2024[30]. - Net income for Q1 2025 was $21 million, a significant decline from $109 million in Q1 2024, resulting in earnings per share of $0.32 compared to $1.62[30]. - Adjusted EBITDA for the three months ended March 31, 2025, was $128 million, with an adjusted EBITDA margin of 10.4%[40]. - The company's ROIC as of March 31, 2025, was 15.0%, indicating effective capital utilization[42]. - Operating profit as adjusted for the three months ended March 31, 2025, was $111 million, compared to $97 million in the previous quarter[44]. - The company reported an EBITDA margin of 8.7% for the three months ended March 31, 2025[40]. Sales and Bookings - Bookings increased by 5.3% sequentially to $1.5 billion, resulting in a book-to-bill ratio of 124%, led by Aerials at 144%[6]. - Net sales in the Aerials segment were $450 million, down 27.8% year-over-year, while Materials Processing saw net sales of $382 million, down 26.5%[11]. - Environmental Solutions Group contributed approximately one-third of Q1 sales, with net sales of $399 million, reflecting a 10.5% increase on a pro forma basis compared to Q1 2024[11]. - The Aerials segment saw net sales drop to $450 million in Q1 2025 from $623 million in Q1 2024, with an operating profit of only $2 million[30]. Financial Outlook - Terex maintains its full-year adjusted EPS outlook of $4.70 to $5.10 for 2025[5]. - The company expects full-year net sales between $5.3 billion and $5.5 billion, with an EBITDA of approximately $660 million[12]. - The company anticipates organic sales to decline by 8%-12% compared to 2024, with segment net sales outlooks indicating low to high single-digit changes across various segments[12]. - The company expects a free cash flow of $325 million for the year ending December 31, 2025, based on an outlook of $445 million in net cash provided by operating activities[34]. Liquidity and Capital Structure - As of March 31, 2025, Terex reported liquidity of $1.1 billion and returned $43 million to shareholders through dividends and share repurchases[11]. - Total assets increased to $5,840 million as of March 31, 2025, up from $5,730 million at the end of 2024[26]. - Cash and cash equivalents decreased to $298 million at the end of Q1 2025, down from $388 million at the beginning of the period[27]. - Total debt was $2,586 million as of March 31, 2025, with cash and cash equivalents of $298 million[44]. - Stockholders' equity as adjusted was $1,957 million as of March 31, 2025, compared to $1,908 million as of December 31, 2024[46]. Tax and Other Considerations - The effective tax rate for Q1 2025 was 20.3%, compared to 20.5% in Q1 2024[35]. - The annualized effective tax rate as adjusted for March 31, 2025, was 17.5%, up from 15.6% in the previous quarter[44]. - Terex is closely monitoring geopolitical and macroeconomic factors, including potential tariff impacts, while positioning itself as a more US-centric company[3]. Operational Strategy - The company plans to continue focusing on operational improvements and capital investments to drive future growth[42]. - The company reported a net cash used in operating activities of $21 million for Q1 2025, compared to $34 million used in Q1 2024[27].

Core Insights - Terex Corporation reported strong financial results for Q1 2025, exceeding initial expectations, primarily due to the performance of its newly acquired Environmental Solutions Group (ESG) [2][5][6] - The company anticipates a competitive position moving forward, with a focus on U.S. production to mitigate geopolitical risks [2][9] Financial Performance - Net sales for Q1 2025 were $1.229 billion, a decrease of 4.9% compared to Q1 2024 [6][29] - Adjusted EPS for Q1 2025 was $0.83, down from $1.74 in Q1 2024 [6][29] - Operating profit was $69 million, representing 5.6% of net sales, compared to $158 million or 12.2% in the prior year [6][29] Business Segment Performance - Environmental Solutions segment net sales reached $399 million, up 10.5% year-over-year, driven by strong demand for refuse collection vehicles [5][29] - Aerials segment net sales were $450 million, down 27.8% year-over-year, attributed to seasonal delivery patterns [6][29] - Materials Processing segment net sales were $382 million, down 26.5% year-over-year, reflecting lower channel requirements and end-market demand [6][29] Bookings and Outlook - Bookings for Q1 2025 were $1.5 billion, a sequential increase of 5.3%, with a book-to-bill ratio of 124% [6][29] - The company maintains its full-year adjusted EPS outlook of $4.70 to $5.10 for 2025 [10][11] Capital Allocation and Liquidity - As of March 31, 2025, Terex had liquidity of $1.1 billion, with $36 million deployed in capital expenditures during Q1 [14][29] - The company returned $43 million to shareholders through dividends and share repurchases in Q1 2025 [14][29]

Company Overview - Terex Corporation is a global industrial equipment manufacturer specializing in materials processing machinery, waste and recycling solutions, mobile elevating work platforms (MEWPs), and equipment for the electric utility industry [3] - The company designs, builds, and supports products used across various sectors including maintenance, manufacturing, energy, minerals and materials management, construction, waste and recycling, and the entertainment industry [3] - Terex provides lifecycle support through a global parts and services organization and offers digital solutions to maximize customer investment returns [3] Environmental Initiatives - Certain Terex products and solutions are designed to reduce environmental impact, including electric and hybrid offerings that provide quiet and emission-free performance [3] - The company also supports renewable energy and aids in the recovery of useful materials from various types of waste [3] Upcoming Financial Results - Terex Corporation will host a conference call to review its first quarter 2025 financial results on May 2, 2025, at 8:00 a.m. Eastern Time [1] - The financial results will be available on the company's investor relations website prior to the call [1]

Core Insights - Terex's international operations are crucial for assessing its financial strength and growth potential, given the interconnected nature of the global economy [2][3] - The company's total revenue for the recent quarter was $1.24 billion, reflecting a 1.5% increase year-over-year [4] International Revenue Breakdown - Western Europe generated $157 million, accounting for 12.65% of total revenue, which was a 32.19% miss against the consensus estimate of $231.54 million [5] - Asia-Pacific contributed $137 million, representing 11.04% of total revenue, falling short by 18.2% compared to the projected $167.48 million [6] Future Revenue Projections - Analysts project total revenue for the current fiscal quarter to reach $1.36 billion, a 5.1% increase from the same quarter last year, with Western Europe expected to contribute $257.14 million and Asia-Pacific $153.7 million [7] - For the full year, total revenue is anticipated to be $5.39 billion, also reflecting a 5.1% increase, with Western Europe and Asia-Pacific expected to contribute $987.49 million and $623.95 million, respectively [8] Market Context - The reliance on international markets presents both opportunities and challenges for Terex, necessitating close monitoring of revenue trends to accurately project future performance [9] - Financial analysts are increasingly focused on international developments and geopolitical factors that may influence earnings estimates for companies like Terex [10]

Financial Performance - Full-year 2024 net sales were $5.1 billion, slightly down from $5.2 billion in 2023, primarily due to industry-wide channel adjustments[9]. - Adjusted earnings per share (EPS) for full-year 2024 was $6.11, the second highest in Terex history, compared to $7.06 in the prior year[5][9]. - Fourth quarter 2024 net sales reached $1.2 billion, a 2% increase year-over-year, driven by the addition of Environmental Solutions Group (ESG)[6]. - Net sales for Q4 2024 were $1,241 million, a slight increase from $1,223 million in Q4 2023, while total net sales for the year were $5,127 million, down from $5,152 million in 2023[25]. - For FY 2024, net sales totaled $5,127 million, with a gross profit of $1,112 million, achieving a gross margin of 21.7%[38]. - Q4 2024 earnings per share (EPS) improved to $0.77, compared to a loss of $0.03 in Q4 2023[37]. - FY 2024 EPS was reported at $6.11, up from $4.96 in FY 2023[38]. Profitability and Margins - Adjusted operating margins for ESG in Q4 2024 were 21.9%, contributing significantly to overall performance[5][12]. - Gross profit for Q4 2024 was $197 million, compared to $263 million in Q4 2023, resulting in a gross margin decrease from 21.5% to 15.9%[25]. - Income from operations for Q4 2024 was $53 million, significantly lower than $116 million in Q4 2023, reflecting a decrease in operating margin from 9.5% to 4.3%[31]. - The company reported a net loss of $2 million in Q4 2024, contrasting with a net income of $127 million in Q4 2023, leading to a loss per share of $0.03 compared to earnings of $1.89 per share in the prior year[25]. - Q4 2024 operating income was $97 million, leading to an operating margin of 7.8%[37]. - FY 2024 operating income increased to $582 million, with an operating margin of 11.3%[38]. - Adjusted EBITDA for Q4 2024 was $114 million, with an adjusted EBITDA margin of 9.2%[45]. - Adjusted EBITDA for FY 2024 reached $642 million, with an adjusted EBITDA margin of 12.5%[45]. Cash Flow and Investments - Full-year 2024 free cash flow was $190 million, lower than the previous year due to reduced operating income and higher interest expenses[12]. - Capital expenditures for 2024 were $137 million, slightly higher than $127 million in 2023, indicating ongoing investment in operations[29]. - The company expects 2025 earnings per share to be impacted by potential future acquisitions and restructuring, with an outlook of $445 million in net cash provided by operating activities[35]. Debt and Equity - Long-term debt rose significantly to $2,580 million as of December 31, 2024, compared to $620 million in 2023, indicating increased leverage[26]. - Total debt as of December 31, 2024, was $2,584 million, with cash and cash equivalents of $388 million[48]. - Debt less cash and cash equivalents amounted to $2,196 million as of December 31, 2024[48]. - Stockholders' equity as adjusted was $1,918 million as of December 31, 2024, an increase from $1,682 million in December 2023[49]. Taxation - The effective tax rate for full-year 2024 was 17.8%, up from 10.9% in the prior year, reflecting changes in tax benefits[9]. - The effective tax rate as adjusted for Q4 2024 was 15.6%, consistent across the previous quarters[48]. - The company reported an effective tax rate of 15.6% for the full year 2024, down from 17.8% as reported[49]. Future Outlook - The company expects 2025 net sales between $5.3 billion and $5.5 billion, with EPS guidance of $4.70 to $5.10[3][13]. - Aerial Work Platforms segment net sales for 2025 are expected to decline in low double digits, while Environmental Solutions is projected to grow in mid single digits[13]. - The company plans to focus on deleveraging and investing in business growth while maintaining a flexible balance sheet in 2025[12]. - The company is facing challenges from increased international tariffs, economic conditions, and competitive pressures, which may affect future performance[23].

Company Segments - The company operates in three segments: Materials Processing (MP), Aerial Work Platforms (AWP), and Environmental Solutions Group (ESG) [10] - The MP segment includes products such as crushers, washing systems, and material handlers, serving construction, mining, and recycling industries [11] - The AWP segment offers aerial work platform equipment, enhancing safety and productivity for various construction and maintenance applications [14] - The ESG segment focuses on waste and recycling equipment, including refuse collection bodies and compaction systems, targeting the solid waste industry [16] Financial Performance and Strategy - The company aims for a net leverage target of 2.5x through the cycle, balancing growth investments and efficient capital return to stockholders [27] - The total backlog as of December 31, 2024, was $2,291 million, a decrease of $1,120 million from $3,411 million in 2023 [44] - The Materials Processing (MP) backlog decreased approximately 58% from $767 million in 2023 to $320 million in 2024 [47] - The Aerial Work Platforms (AWP) backlog decreased approximately 45% from $2,644 million in 2023 to $1,451 million in 2024 [48] - The Environmental Solutions Group (ESG) backlog was $520 million as of December 31, 2024 [49] - The company expects second half sales in 2025 to be higher than first half sales, with stronger demand anticipated in the second quarter due to seasonal project spending [69] Innovation and Product Development - The company emphasizes digital transformation and innovation to improve product offerings and operational efficiency [25] - The company is focusing on product innovation and has established robust product development pipelines to introduce new differentiated products in the coming years [56] - The company is developing alternative power solutions across its product range, including battery-electric and fuel-electric hybrid options, to reduce carbon footprints [55] - The company is actively investing in alternative energy solutions and developing products that meet increasingly stringent environmental regulations [66] Safety and Environmental Commitment - The company aims to achieve a lost time injury rate of 0.4 and a total recordable injury rate of 1.4 by the end of 2026, with current rates at 0.37 and 1.49 respectively [71] - The company is committed to reducing greenhouse gas emissions and has developed all-electric utility bucket trucks, which support electrification and sustainability goals [66] - The company maintains a commitment to safety and environmental stewardship, ensuring compliance with health, safety, and environmental laws [63] - The company is committed to complying with environmental laws and regulations, conducting environmental audits at least once every five years [64][68] Workforce and Culture - The company has approximately 11,400 team members, with 88% participating in a global engagement survey, indicating a strong focus on team member engagement [73] - The company has a robust talent review process and offers a wide range of training programs to support team member development [74] - The company emphasizes a culture of inclusion and diversity, aiming to create a supportive and non-discriminatory workplace [77] Legal and Compliance - The company is engaged in various legal proceedings regarding intellectual property rights but does not expect a material adverse effect on its business [62] - The company’s engineering teams are focused on delivering customer-responsive solutions and complying with evolving regulatory standards [54] Customer Focus - In 2024, the largest customer accounted for less than 6% of consolidated net sales, and the top ten customers collectively accounted for less than 29% [60] - The company operates under a best value strategy, focusing on improving customer return on invested capital (ROIC) through quality by design [59] - The company offers a range of services for its products, including inspections, maintenance, and training services [39][43]