Terex, makers of mobile cranes and materials handling solutions, have reported a drop in net sales over the second quarter of $23.8 million, or 5%, when compared to the second quarter of 2009.
Once the effects of exchange rates and acquisitions have been discounted, the decrease in net sales from 2009’s second quarter is 21%. The demand for commercial construction equipment remained weak, with lower capacity crane demand continuing to regress. The large infrastructural projects across the globe drove a respectable demand for large capacity crawler cranes, whilst tower cranes and rough terrain cranes remained fairly constant, although that consistency is mitigated by the fact that demand was constant but low. The pick-and-carry crane in Australia, and thhe truck crane sector in China have, however, improved.
Terex’s chief operating officer and President, Tim Riordan, stated:
Overall, order activity in most of our product categories increased during the second quarter of 2010 compared with the previous quarter and previous year period. However, as expected, our cranes segment continued to experience a net sales and backlog decline versus the prior year period. We expect this trend to continue, but moderate during the balance of 2010. A bright spot within the cranes segment was the improvement in the Terex Port Equipment business. Order inquiries for this business have increased substantially compared to last year and we are seeing the positive impact of restructuring programs take effect.
The operating profit of Terex’s crane section showed a decrease of $8 million, down to $17 million from $25 million in the second quarter of 2009. Terex corporation, the umbrella company of the many groups, registered a net loss of $13.1 million, compared to a net profit of $99.6 million in the previous year’s period.
We have just completed a challenging first half of 2010, said Ron DeFeo, a chairman and chief executive officer of Terex, but many of our businesses have seen their recent results show improvement of trough levels experienced during 2009. We are cautious, but positive, about our prospects for continued improvement. Backlog in three of our four segments indicate slightly improved near-term prospects. Our factories have returned to more regular work schedules and production output. These improving business conditions are the basis for our cautious optimism about the balance of 2010 and lay the foundation for what we feel will be a positive business environment in 2011 for most of our product categories.