Manitex International, Inc. Reports Second Quarter 2010 Results

BRIDGEVIEW, Ill., Aug. 11 /PRNewswire-FirstCall/ -- Manitex International, Inc. (Nasdaq: MNTX), a leading provider of engineered lifting solutions including boom truck and rough terrain cranes, rough terrain forklifts, special mission oriented vehicles and specialized engineered trailers, today announced second quarter 2010 revenues of $19.5 million, a 65% year-over-year increase, and net income for the second quarter of 2010 of $0.2 million or $0.02 per share, compared to a net loss of ($0.1 million) or ($0.01) per share for the second quarter of 2009.

Second Quarter 2010 Financial Highlights:

• Net revenues for the quarter ended June 30, 2010 were $19.5 million, representing a 65% increase from the second quarter of 2009. Excluding the impact of acquisitions, net revenues increased 29.5% from the comparable prior year period.
• EBITDA(1) for the second quarter of 2010 increased by 192% to $1.7 million equal to 8.9% of sales, compared to $0.6 million or 5.0% of sales for the second quarter of 2009.
• Gross profit margin of 23.6% in the second quarter of 2010 was an improvement of 270 basis points compared to the second quarter of 2009.
• Net income for the second quarter of 2010 of $0.2 million or $0.02 per share (2), compared to a net loss of ($0.1) million or ($0.01) per share for the second quarter of 2009.
• Working capital at June 30, 2010 was $29.3 million, compared to $25.6 million at December 31, 2009.  The current ratio of 2.9 to 1, at June 30, 2010 improved 0.1, compared to 2.8 to 1 at December 31, 2009.
• June 30, 2010 backlog increase of 14% compared to March 31, 2010

Subsequent to the Quarter:

• Commenced CVS-Ferrari Operating Agreement

Chairman and Chief Executive Officer David Langevin commented, "Our specialty manufacturing strategy is working. Our plants are running at much better rates of production in comparison to a year ago and our visibility is good for the rest of the year. This optimism is reflected in the solid improvement in the backlog of our core crane products. Finally, we are very excited about the addition of our recently announced CVS Ferrari operating contract. CVS puts our Company into a specialty port service area which is showing significant growth. This new business area is international in scope, has large scale, and has the potential to bring a meaningful increase to our financial results. Moreover, we expect that CVS Ferrari sales will begin to contribute to our financial results beginning in the third quarter of this year."

Net revenues of $19.5 million in the second quarter of 2010 increased $7.7 million or 65% over the second quarter of 2009, with approximately 55% of the increase attributable to the acquisitions of Badger and Load King that occurred in quarters three and four of 2009 respectively. The remaining 45% of the increase compared to the second quarter of 2009 resulted from strong demand for material handling product from military and international customers and for Manitex boom truck cranes.

Gross profit of $4.6 million and gross margin percent of 23.6% were $2.1 million and 270 basis points respectively above the second quarter of 2009. The improvement in gross margin percent resulted from higher margin product mix in sales, particularly in the military material handling and higher capacity and specialized crane products, and from the restructuring and cost control actions taken during 2009.

SG&A expenses for the second quarter of 2010 decreased $0.5 million from the first quarter of 2010 as lower costs were incurred for legal and professional fees associated with statutory requirements and acquisition activities. Excluding the impact of acquisitions, SG&A costs increased $0.4 million compared to the second quarter of 2009 with the majority of the increase related to supporting increased requirements from sales and service volumes and expenses related to the continued investment in overseas markets.

Andrew Rooke, Manitex International President and Chief Operating Officer commented, "We believe that given the still-challenging current economic situation, this second quarter provided a solid set of results and continuing positive indicators regarding our market performance. We again reported revenue growth compared to the comparable 2009 quarter, with an increase of $7.7 million of which approximately 45% or $3.5 million was from the underlying business, excluding the acquisitions made in 2009. An encouraging aspect of this increase was a stronger quarter from the boom truck crane business driven by demand from our niche energy and international products. These same factors have contributed to the 14% increase in our backlog from the end of the first quarter of 2010 to $24.9 million, which now provides some improved visibility into the second half of the year. We are also excited that we have an additional opportunity to add to this backlog from the operating agreement for the CVS Spa container handling business that we entered into on June 30, 2010."

Mr. Rooke continued, "We were pleased to report a continuation of strong cash generation, with EBITDA for the quarter of $1.7 million, or 8.9% of sales, a result of the improved cost structure achieved over the last eighteen months and favorable mix of higher margin material handling and crane products. Our operating working capital increased $0.5 million from the first quarter of 2010 as both receivables and inventory increased in response to the higher levels of activity and we ended the quarter with an operating working capital ratio to the last quarter's annualized sales of 41.4%. With our continued focus on working capital and the previously referenced increase in our backlog, we are optimistic that we will continue to be able to generate strong cash flow in the coming months.

(1)  EBITDA is a non-GAAP (generally accepted accounting principles in the United States of America) financial measure. This measure may be different from non-GAAP financial measures used by other companies.  We encourage investors to review the section below entitled "Non-GAAP Financial Measures."

(2)  Weighted average diluted shares outstanding for the second quarter of 2010 were 11,392,759 and for the second quarter of 2009 were 10,836,132.

Conference Call:

Today, Wednesday August 11th, management will host a conference call at 4:30 p.m. Eastern Time to discuss the results for the second quarter of 2010 with the investment community.

Anyone interested in participating should call 1-877-941-8601 if calling within the United States or 1-480-629-9810 if calling internationally. A re-play will be available until August 18, 2010, which can be accessed by dialing 1-877-870-5176 if calling within the United States or 1-858-384-5517 if calling internationally. Please use passcode 4341549 to access the replay.

The call will also be accompanied by a webcast over the Internet with slides, accessible at the Company's corporate website at www.manitexinternational.com.

About Manitex International, Inc.

Manitex International, Inc. is a leading provider of engineered lifting solutions including cranes, rough terrain forklifts, indoor electric forklifts and special mission oriented vehicles, including parts support. Our Manitex subsidiary manufactures and markets a comprehensive line of boom trucks and sign cranes through a national and international dealership network. Our boom trucks and crane products are primarily used in industrial projects, energy exploration and infrastructure development, including roads, bridges, and commercial construction. Our Crane and Machinery division is a Chicago based distributor of cranes including Terex truck and rough terrain cranes, Fuchs material handlers and our own Manitex product line. Crane and Machinery provides after market service in its local market as well as being a leading distributor of OEM crane parts, supplying parts to customers throughout the United States and internationally. Our Manitex Liftking subsidiary is a provider of material handling equipment including the Noble straight-mast rough terrain forklift product line, Lowry high capacity cushion tired forklift and Schaeff electric indoor forklifts as well as specialized carriers, heavy material handling transporters and steel mill equipment. Manitex Liftking's rough terrain forklifts are used in both commercial and military applications. In July 2009, we acquired through a stock purchase, Badger Equipment Company, a Winona, Minnesota-based manufacturer of specialized rough terrain cranes and material handling products.  In December 2009, we acquired Load King Trailers, a manufacturer of specialized custom trailers and hauling systems typically used for transporting heavy equipment.

Forward-Looking Statement

Safe Harbor Statement under the U.S. Private Securities Litigation Reform Act of 1995: This release contains statements that are forward-looking in nature which express the beliefs and expectations of management including statements regarding the Company's expected results of operations or liquidity; statements concerning projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results and future economic performance; and statements of management's goals and objectives and other similar expressions concerning matters that are not historical facts.  In some cases, you can identify forward-looking statements by terminology such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "we believe," "we intend," "may," "will," "should," "could," and similar expressions. Such statements are based on current plans, estimates and expectations and involve a number of known and unknown risks, uncertainties and other factors that could cause the Company's future results, performance or achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. These factors and additional information are discussed in the Company's filings with the Securities and Exchange Commission and statements in this release should be evaluated in light of these important factors. Although we believe that these statements are based upon reasonable assumptions, we cannot guarantee future results. Forward-looking statements speak only as of the date on which they are made, and the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.

Supplemental Information

Non-GAAP Financial Measures

This press release includes the following non-GAAP financial measure: "EBITDA" (earnings before interest, tax, depreciation and amortization).  This non-GAAP term, as defined by the Company, may not be comparable to similarly titled measures used by other companies. EBITDA is not a measure of financial performance under generally accepted accounting principles. Items excluded from EBITDA are significant components in understanding and assessing financial performance. EBITDA should not be considered in isolation or as a substitute for net earnings, operating income and other consolidated earnings data prepared in accordance with GAAP or as a measure of our profitability.  A reconciliation of net income to EBITDA is provided below.

The Company's management believes that EBITDA and EBITDA as a percentage of sales represent key operating metrics for its business.  Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is a key indicator used by management to evaluate operating performance. While EBITDA is not intended to replace any presentation included in our consolidated financial statements under generally accepted accounting principles (GAAP) and should not be considered an alternative to operating performance or an alternative to cash flow as a measure of liquidity, we believe this measure is useful to investors in assessing our capital expenditure and working capital requirements. This calculation may differ in method of calculation from similarly titled measures used by other companies. A reconciliation of EBITDA to GAAP financial measures for the three and six month periods ended June 30th, 2010 and June 30th 2009 is included with this press release below and with the Company's related Form 8-K.

Reconciliation of GAAP Net Income from Continuing Operations to Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) from Continuing Operations (in thousands)  

In an effort to provide investors with additional information regarding the Company's results, Manitex International refers to various non-GAAP (U.S. generally accepted accounting principles) financial measures which management believes provides useful information to investors.  These measures may not be comparable to similarly titled measures being disclosed by other companies. In addition, the Company believes that non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures.

Manitex International believes that this information is useful to understanding its operating results and the ongoing performance of its underlying businesses. Management of Manitex International uses these non–GAAP financial measures to establish internal budgets and targets and to evaluate the Company's financial performance against such budgets and targets.

The amounts described below are unaudited, are reported in thousands of U.S. dollars, and are as of or for the period ended June 30, 2010, unless otherwise indicated.

Backlog

Backlog is defined as firm orders that have been received by the Company. The disclosure of backlog aids in the analysis the Company's customers' demand for product, as well as the ability of the Company to meet that demand. Backlog is not necessarily indicative of sales to be recognized in a specified future period.

Current Ratio is calculated by dividing current assets by current liabilities.

Days Sales Outstanding (DSO), is calculated by taking the sum of net trade and related party receivables divided by annualized sales per day (sales for the quarter, multiplied by 4, and the sum divided by 365).

Days Payables Outstanding (DPO), is calculated by taking the sum of net trade and related party payables divided by annualized cost of sales per day (cost of goods sold for the quarter, multiplied by 4, and the sum divided by 365).

Debt is calculated using the Condensed Consolidated Balance Sheet amounts for current and long term portion of long term debt, capital lease obligations, notes payable and lines of credit.

Inventory turns are calculated by multiplying cost of goods sold for the referenced three month period by 4 and dividing that figure by inventory as at the referenced period.

Manufacturing Expenses include manufacturing wages, salaries, fixed and variable overhead costs.

Operating Working Capital is calculated using the Consolidated Balance Sheet amounts for Trade receivables (net of allowance) plus other receivables, plus inventories, less Accounts payable. The Company considers excessive working capital as an inefficient use of resources, and seeks to minimize the level of investment without adversely impacting the ongoing operations of the business.

Trailing Three Month Annualized Net Sales is calculated using the net sales for quarter, multiplied by four.

Working capital is calculated as total current assets less total current liabilities

SOURCE Manitex International, Inc.