Release Date: August 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Manitex International Inc (MNTX, Financial) achieved nearly 20% year-over-year growth in adjusted EBITDA, marking the fourth consecutive quarter with an adjusted EBITDA margin over 10%.
- The company reported a strong performance in its rental segment, with revenues increasing by 15% due to geographic and fleet expansions.
- Gross margins improved by 220 basis points compared to the same period last year, driven by increased manufacturing throughput and lower material costs.
- Manitex International Inc (MNTX) successfully reduced its net debt by over $2 million during the quarter, improving its net leverage ratio to 2.5 times.
- The company is making significant progress on its dealer expansion strategy in North America, with strong interest from potential partners for its PM Group products.
Negative Points
- Order intake has slowed due to increased interest rates, affecting machine replacement cycles and dealer stocking levels.
- The company's total backlog decreased from $154 million at the end of Q1 to $116 million by the end of Q2.
- Manitex International Inc (MNTX) lowered its full-year 2024 revenue guidance to a range of $290 million to $300 million due to slowing order trends.
- There is hesitancy in the North American market, particularly due to interest rate concerns and the upcoming US election.
- The company faces challenges in maintaining its growth momentum amidst mixed end-market trends and macroeconomic uncertainties.
Q & A Highlights
Q: Can you provide some color on the geographic and market vertical challenges in the Lift Truck business? Are these challenges more prevalent in the US or Europe?
A: Michael Coffey, Chief Operating Officer, explained that most concerns are in North America, largely due to interest rates affecting equipment replacement cycles. European markets had some early hesitancy due to tax guidance, but this has since resolved favorably. The utility sector in the US is not showing hesitancy for Manitex products, contrary to some peers' experiences.
Q: How is Manitex's rental segment performing compared to larger rental companies that are experiencing softening rates and utilization?
A: Michael Coffey noted that Manitex's rental segment, particularly in North Texas, is performing well due to strong market conditions and strategic fleet investments. The company is benefiting from its acquisition of Raeburn Rentals and is less impacted by broader economic downturns.
Q: What is the status of bringing knuckle boom products from Italy to the US, and how will Manitex support these products in terms of parts and service?
A: Joseph Doolan, Chief Financial Officer, stated that Manitex is in active discussions with five North American dealers and expects to appoint two or three partners this year. The company has established a support structure in Georgetown, Texas, and has stocked critical parts in the US to ensure strong product support.
Q: There seems to be a discrepancy in the interest expense figures between the income statement and the reconciliation tables. Can you explain this?
A: Joseph Doolan clarified that the difference is due to interest income being split out separately this year, whereas it was previously netted against interest expense.
Q: Are there any specific market segments or geographic areas where Manitex is seeing strong demand or growth?
A: Michael Coffey highlighted that markets exposed to mining and minerals are showing strong demand. Additionally, public works spending is increasing, which is positively impacting Manitex's key end markets.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
