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8-K - 8-K - Manitex International, Inc.d576228d8k.htm

Exhibit 99.1

Manitex International, Inc. Reports Second Quarter 2018 Results

Bridgeview, IL, August 7, 2018 — Manitex International, Inc. (Nasdaq: MNTX), a leading international provider of truck and knuckle boom cranes, today announced Second Quarter 2018 results. Net revenues for the second quarter were $63.9 million, compared to $52.1 million in the prior year’s period*, and net loss from continuing operations attributable to shareholders of Manitex of $(1.0) million, or $(0.05) per share, compared to a net loss from continuing operations attributable to shareholders of Manitex of $(1.5) million, or $(0.09) per share, in the second quarter of 2017*. Adjusted net income** from continuing operations in the second quarter 2018 was $1.9 million, or $0.11 per share, compared to adjusted net loss of $(1.0) million, or $(0.06) per share, for the second quarter of 2017*.

Highlights (versus prior year, unless otherwise noted):

 

   

Net revenues of $63.9 million, up 22.8%

 

   

Adjusted EBITDA** increased 188% to $5.2 million, or 8.1% of sales, from $1.8 million or 3.5% of sales

 

   

Adjusted earnings per share** improved to $0.11 compared to an adjusted loss per share of $(0.06)

 

   

Backlog declined moderately from $88 million in Q1 2018 to $76 million, up 59% from Q2 2017

 

   

$32.7 million strategic investment by Tadano

 

   

Net debt of $51 million represents reduction of $39 million from year-end 2017

 

*

All references in this release to financial results of periods ending prior to the third quarter of 2017 reflect such results as restated pursuant to the recently completed restatement of such periods.

 

**

Adjusted Numbers are discussed in greater detail and reconciled under “Non-GAAP Financial Measures and Other Items” at the end of this release.

“The results reported today continue to show steady improvement in our operations, with growth in sales, margins, and adjusted income. However, we believe, the most significant event which occurred in the second quarter was the $32.7 million investment in Manitex by Tadano Corporation,” commented David J. Langevin, Chief Executive Officer of Manitex.

“The Tadano investment has enabled us to reduce our net debt to approximately $51 million, which represents a $144 million reduction from its peak level just over three years ago. We believe we now have sufficient working capital position to execute our global growth plans and take advantage of opportunities that our new relationship with Tadano presents.”.

Steve Kiefer, President and Chief Operating Officer of Manitex stated, “In the quarter, we generated improved revenue and earnings reflecting strengthening global demand for our products and operational execution of our sales and manufacturing teams. Revenue of $63.9 million increased 23% versus the same period last year, and 13% versus the previous quarter. Our ongoing efforts to diligently manage near-term currency, inflation and supply chain challenges allowed us to maintain our gross margin compared to last quarter and increase by 140 basis points versus the same period last year. To offset supply chain inflation and continue gross profit expansion, we are currently executing the necessary cost reductions and operational improvements that we believe will allow us to achieve our near-term target of gross margin exceeding 20% and EBITDA margins of 10%.

We saw our core product lines well-positioned to allow us to take advantage of the overall strength within the industrial goods market during the quarter. As of the end of the June quarter, backlog for our European Group, primarily consisting of our PM global knuckleboom business, was up 133 percent compared to the same period last year. Going forward, we are confident that revenues contributed by PM will continue growing as a percentage of our total enterprise revenues, through ongoing dealer development and new product enhancements, as well as our important partnership with Tadano, particularly in Asia and the Middle East.

On the straight mast side, as we previously reported, we experienced a spike in order rate at the beginning of the year which has since moderated, and the total industry volume was approximately 800 units for the first half of the year, a healthy level, still below peak with potential to continue to go higher. 65% of our backlog is comprised of cranes with ratings of 30 tons and higher being driven by activity within the energy, utility, infrastructure and general rental segments.

Going forward, we remain focused on operational execution, revenue expansion, and new product development, and we are working hard to increase value for our customers, shareholders, employees and other stakeholders,” concluded Mr. Kiefer.

Other Matters:

As previously disclosed, the Company has received an inquiry from the SEC requesting certain information in connection with the Company’s recently completed restatement of prior financial statements and is continuing to comply with such request.


Conference Call:

Management will host a conference call at 4:30 PM Eastern Time today to discuss the results with the investment community. Anyone interested in participating in the call should dial 800-949-2175 if calling within the United States or 323-994-2132 if calling internationally. A replay will be available until August 14, 2018, which can be accessed by dialing 844-512-2921 if calling within the United States, or 412-317-6671 if calling internationally. Please use passcode1055909 to access the replay. The call will additionally be broadcast live and archived for 90 days over the internet with accompanying slides, accessible at the investor relations portion of the Company’s corporate website, www.manitexinternational.com/eventspresentations.aspx.

Non-GAAP Financial Measures and Other Items

Results of operations reflect continuing operations. All per share amounts are on a fully diluted basis. In this press release, Manitex refers to various non-GAAP (U.S. generally accepted accounting principles) financial measures which management uses to evaluate operating performance, to establish internal budgets and targets, and to compare the Company’s financial performance against such budgets and targets. These non-GAAP measures, as defined by the Company, may not be comparable to similarly titled measures being disclosed by other companies. While adjusted financial measures are 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 these measures are useful to investors in assessing our operating results, capital expenditure and working capital requirements and the ongoing performance of its underlying businesses. The amounts described below are unaudited, are reported in thousands of U.S. dollars, and are as of, for three month period ended June 30, 2018 and June 30, 2017, unless otherwise indicated. A reconciliation of Adjusted GAAP financial measures for the three month periods ended June 30, 2018 and 2017 is included with this press release below and with the Company’s related Form 8-K.

About Manitex International, Inc.

Manitex International, Inc. is a leading worldwide provider of highly engineered specialized equipment including boom truck, truck and knuckle boom cranes. Our products, which are manufactured in facilities located in the USA and Italy, are targeted to selected niche markets where their unique designs and engineering excellence fill the needs of our customers and provide a competitive advantage. We have consistently added to our portfolio of branded products and equipment both through internal development and focused acquisitions to diversify and expand our sales and profit base while remaining committed to our niche market strategy. Our brands include Manitex, PM, O&S, Badger, Sabre, and Valla.

Forward-Looking Statements

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.

Company Contact

 

Manitex International, Inc.    Darrow Associates Inc.
Steve Kiefer    Peter Seltzberg, Managing Director
President and Chief Operating Officer    Investor Relations
(708) 237-2065    (516) 419-9915
skiefer@manitex.com    pseltzberg@darrowir.com


MANITEX INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share data)

 

     June 30,
2018
    December 31,
2017
 
     Unaudited     Unaudited  

ASSETS

    

Current assets

    

Cash

   $ 20,630     $ 5,014  

Cash—restricted

     308       352  

Marketable equity securities

     6,253       —    

Trade receivables (net)

     47,607       46,633  

Other receivables

     2,898       1,946  

Inventory (net)

     69,154       54,360  

Prepaid expense and other

     2,369       2,017  
  

 

 

   

 

 

 

Total current assets

     149,219       110,322  
  

 

 

   

 

 

 

Total fixed assets, net of accumulated depreciation of $13,870 and $12,921 for June 30, 2018 and December 31, 2017, respectively

     20,850       22,038  

Intangible assets (net)

     29,042       31,014  

Goodwill

     42,654       43,569  

Equity investment in ASV Holdings, Inc.

     —         14,931  

Other long-term assets

     1,270       1,475  

Deferred tax asset

     1,839       1,839  
  

 

 

   

 

 

 

Total assets

   $ 244,874     $ 225,188  
  

 

 

   

 

 

 

LIABILITIES AND EQUITY

    

Current liabilities

    

Notes payable

   $ 24,263     $ 29,131  

Current portion of capital lease obligations

     398       378  

Accounts payable

     46,183       35,386  

Accounts payable related parties

     475       1,331  

Accrued expenses

     9,570       10,070  

Customer deposits

     2,556       2,242  

Other current liabilities

     142       890  
  

 

 

   

 

 

 

Total current liabilities

     83,587       79,428  
  

 

 

   

 

 

 

Long-term liabilities

    

Revolving term credit facilities

     —         12,893  

Notes payable (net)

     26,827       26,656  

Capital lease obligations, (net of current portion)

     5,279       5,483  

Convertible note related party (net)

     7,080       7,005  

Convertible note (net)

     14,419       14,310  

Deferred gain on sale of property

     906       969  

Deferred tax liability

     3,558       3,384  

Other long-term liabilities

     3,883       4,215  
  

 

 

   

 

 

 

Total long-term liabilities

     61,952       74,915  
  

 

 

   

 

 

 

Total liabilities

     145,539       154,343  
  

 

 

   

 

 

 

Commitments and contingencies

    

Equity

    

Preferred Stock—Authorized 150,000 shares, no shares issued or outstanding at June 30, 2018 and December 31, 2017

     —         —    

Common Stock—no par value 25,000,000 shares authorized, 19,606,518 and 16,617,932 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively

     130,083       97,661  

Paid in capital

     2,708       2,802  

Retained deficit

     (31,035     (28,583

Accumulated other comprehensive loss

     (2,421     (1,035
  

 

 

   

 

 

 

Total equity

     99,335       70,845  
  

 

 

   

 

 

 

Total liabilities and equity

   $ 244,874     $ 225,188  
  

 

 

   

 

 

 


MANITEX INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except for share and per share amounts)

 

     Three Months Ended
June 30,
    Six Months Ended
June 30,
 
     2018     2017     2018     2017  
     Unaudited     Unaudited     Unaudited     Unaudited  

Net revenues

   $ 63,904     $ 52,051     $ 120,579     $ 92,170  

Cost of sales

     51,463       42,647       97,038       75,374  
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     12,441       9,404       23,541       16,796  

Operating expenses

        

Research and development costs

     726       596       1,378       1,283  

Selling, general and administrative expenses

     9,008       8,574       18,994       17,515  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     9,734       9,170       20,372       18,798  
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     2,707       234       3,169       (2,002

Other (expense) income

        

Interest expense:

        

Interest expense

     (1,503     (1,574     (3,056     (2,782

Change in fair value of securities held

     (1,588     —         (1,401     —    

Foreign currency transaction loss

     (106     (256     (225     (339

Interest income and other (loss) income

     29       70       (325     343  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other expense

     (3,168     (1,760     (5,007     (2,778
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before income taxes and income (loss) in equity interest from continuing operations

     (461     (1,526     (1,838     (4,780

Income tax expense (benefit) from continuing operations

     506       (36     205       135  

Loss on equity investments (including loss on sale of shares)

     —         —         (409     —    
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss from continuing operations

     (967     (1,490     (2,452     (4,915

Discontinued operations

        

Loss from operations of discontinued operations (including loss on disposal for the three and six months 2017 of $1,133)

     —         (805     —         (573

Income tax benefit

     —         6       —         (13
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from discontinued operations

     —         (811     —         (560
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

     (967     (2,301     (2,452     (5,475
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income attributable to noncontrolling interest from discontinued operations

     —         (160     —         (274
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss attributable to shareholders of Manitex International, Inc.

   $ (967   $ (2,461   $ (2,452   $ (5,749
  

 

 

   

 

 

   

 

 

   

 

 

 

Earnings (loss) Per Share

        

Basic

        

Earnings (loss) from continuing operations attributable to shareholders of Manitex International, Inc.

   $ (0.05   $ (0.09   $ (0.14   $ (0.30

Loss from discontinued operations attributable to shareholders of Manitex International, Inc.

   $ —       $ (0.06   $ —       $ (0.05

Net earnings (loss) attributable to shareholders of Manitex International, Inc.

   $ (0.05   $ (0.15   $ (0.14   $ (0.35

Diluted

        

Earnings (loss) from continuing operations attributable to shareholders of Manitex International, Inc.

   $ (0.05   $ (0.09   $ (0.14   $ (0.30

Loss from discontinued operations attributable to shareholders of Manitex International, Inc.

   $ —       $ (0.06   $ —       $ (0.05

Net earnings (loss) attributable to shareholders of Manitex International, Inc.

   $ (0.05   $ (0.15   $ (0.14   $ (0.35

Weighted average common shares outstanding

        

Basic

     17,734,383       16,553,667       17,200,660       16,512,061  

Diluted

     17,734,383       16,553,667       17,200,660       16,512,061  


Reconciliation of GAAP Operating Income (Loss) from Continuing Operations to Adjusted EBITDA (in thousands)    

 

     Three Months Ended     Six Months Ended  
     June 30, 2018     June 30, 2017     June 30, 2018     June 30, 2017  

Operating income (loss)

   $ 2,707     $ 234     $ 3,169     ($ 2,002

Adjustments related to restatement, restructuring, discontinued model, restricted stock, and other expenses

     1,196       397       3,138       1,416  

Adjusted operating income (loss)

     3,903       631       6,307       (586

Depreciation and amortization

     1,258       1,165       2,551       2,688  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

   $ 5,161     $ 1,796     $ 8,858     $ 2,102  
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted EBITDA % to sales

     8.1     3.5     7.3     2.3

Reconciliation of GAAP Net Income (Loss) From Continuing Operations Attributable to Shareholders of Manitex International to Adjusted Net Income (Loss) From continuing Operations Attributable to Shareholders of Manitex International (in thousands)

 

     Three Months Ended      Six Months Ended  
     June 30, 2018      June 30, 2017      June 30, 2018      June 30, 2017  

Net Income (Loss) from continuing operations attributable to shareholders

   ($ 967    ($ 1,490    ($ 2,452    ($ 4,915

Adjustments related to restatement, restructuring, discontinued model, restricted stock, foreign exchange, change in fair value of securities and other expenses

     2,859        533        5,132        1,635  

Adjusted Net Income (Loss) from continuing operations attributable to shareholders

     1,892        (957      2,680        (3,280

Weighted diluted shares outstanding

     17,734,383        16,553,667        17,200,660        16,512,061  

Diluted (loss) per share attributable to shareholders as reported

   ($ 0.05    ($ 0.09    ($ 0.14    ($ 0.30
  

 

 

    

 

 

    

 

 

    

 

 

 

Total EPS effect

   $ 0.16      $ 0.03      $ 0.30      $ 0.10  
  

 

 

    

 

 

    

 

 

    

 

 

 

Adjusted diluted income (loss) per share attributable to shareholders

   $ 0.11      ($ 0.06    $ 0.16      ($ 0.20
  

 

 

    

 

 

    

 

 

    

 

 

 

Foreign Exchange, Restatement, Restructuring, Restricted Stock and other Expenses

 

     Three Months Ended      Six Months Ended  

Pre-tax adjustments

   June 30, 2018      June 30, 2017      June 30, 2018      June 30, 2017  

Restatement expenses

   $ 626        —        $ 1,823        —    

Foreign exchange

     106        256        225        339  

Discontinued model

     188           188     

Restructuring

     74        301        654        574  

Restricted stock

     268        96        391        325  

change in fair market value of securities, and other expenses

     1,628           2,245        517  
  

 

 

    

 

 

    

 

 

    

 

 

 

Total

   $ 2,890      $ 653      $ 5,526      $ 1,755  
  

 

 

    

 

 

    

 

 

    

 

 

 


Backlog from Continuing Operations

Backlog is defined as purchase 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.

 

     June 30, 2018      March 31, 2018     December 31, 2017     September 30, 2017     June 30, 2017  

Backlog

   $ 75,601      $ 87,860     $ 61,530     $ 50,281     $ 47,554  

Change Versus Current Period

        -14.0     22.9     50.4     59.0

Net 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, convertible notes and revolving credit facilities minus cash.

 

     June 30, 2018      December 31, 2017  

Cash

   $ 27,191      $ 5,366  

Notes payable—short term

   $ 24,263      $ 29,131  

Current portion of capital leases

     398        378  

Revolving term credit facilities

     0        12,893  

Notes payable—long term

     26,827        26,656  

Capital lease obligations

     5,279        5,483  

Convertible notes

     21,499        21,315  
  

 

 

    

 

 

 

Total debt

   $ 78,266      $ 95,856  
  

 

 

    

 

 

 

Net Debt

     51,075        90,490