Terex announces Q3 results

Terex announces Q3 results

The new Port Equipment business, expanded last year following the successful acquisition of the Fantuzzi Group, contributed to the group’s overall loss.

“Our Port Equipment business has not been profitable, as we are still suffering from the net sales gap created before our [Fantuzzi] acquisition and the longer lead times of this business,” said Terex President and COO, Tom Riordan.

He added that customers had increased their quotation activity, indicating there are better prospects for success ahead for the business.

Even with recent “increased quotation activity”, Terex Chairman and CEO, Ron DeFeo said that he did not expect to see a positive impact from the Port Equipment business until 2012.

“We are not yet in a position to set overall expectations for 2011, but we do believe it will be a profitable year. In addition, we expect to reinvest our cash in the business, repay additional debt or a combination of both during 2011.”

Net sales overall for continuing operations at Terex were US$1,075.8m during the quarter, an increase of 15.2% from the US$933.9m Q3-2009 figure. Income from operations was US$3.0m, an increase of US$103.3m compared to a loss of US$100.3m for the same period in 2009.

Pre-tax expenses of approximately US$21m contributed to the loss. These expenses were associated with marking to market derivative instruments intended to partially mitigate risks associated with 5.8 million shares of the common stock of Bucyrus International, Inc. acquired in connection with the Mining business divestiture.

Additionally, the results include tax expense of approximately US$21m for increased valuation allowances on certain deferred tax assets; approximately US$12m for increased provisions for uncertain tax positions, and approximately US$6m related to the decision to carry back US tax net operating losses.

In total, these items negatively impacted earnings per share by approximately US$0.48.