Manitowoc's CEO Discusses Q4 2011 Results - Earnings Call Transcript

Manitowoc (MTW)

Q4 2011 Earnings Call

February 01, 2012 10:00 am ET

Executives

Steven C. Khail - Director of Investor Relations & Corporate Communications

Glen E. Tellock - Chairman, Chief Executive Officer and President

Carl J. Laurino - Chief Financial Officer and Senior Vice President

Mike Kachmer - Senior Vice President and President of Manitowoc Foodservice Group

Eric P. Etchart - Senior Vice President, President of Manitowoc Crane Group and General Manager of Manitowoc Crane

Analysts

Adam Nielsen - RBC Capital Markets, LLC, Research Division

Robert F. McCarthy - Robert W. Baird & Co. Incorporated, Research Division

Unknown Analyst

Vlad Bystricky - Barclays Capital, Research Division

Jerry Revich - Goldman Sachs Group Inc., Research Division

Ann P. Duignan - JP Morgan Chase & Co, Research Division

Vance Edelson - Morgan Stanley, Research Division

Ted Grace - Susquehanna Financial Group, LLLP, Research Division

Paul A. Bodnar - Longbow Research LLC

Presentation

Operator

Good day, everyone, and welcome to this Manitowoc Company Inc. Fourth Quarter and Year-end Earnings Conference Call. Today's conference is being recorded. At this time, for opening remarks and introductions, I'd like to turn the call over to Mr. Khail. Please go ahead, sir.

Steven C. Khail

Good morning, everyone. Thank you for joining us today as we discuss Manitowoc's fourth quarter earnings and our outlook for 2012. Participating in today's call will be Glen Tellock, our Chairman and Chief Executive Officer; Carl Laurino, Senior Vice President and Chief Financial Officer; Mike Kachmer, President of Manitowoc Foodservice; and Eric Etchart, President of Manitowoc Cranes, who is joining us from our offices in Paris.

Glen will open today's call by reviewing our 2011 accomplishments, Carl will then discuss our financial results for the fourth quarter and provide our initial guidance for 2012, then our segment presidents will offer insights into the market conditions and outlooks for their businesses in 2012.

For anyone who is not able to listen to today's entire call, an archived version of this call will be available later this morning. Please visit the Investor Relations section of our corporate website at www.manitowoc.com to access the replay.

Before Glen gives his commentary, I would like to review our Safe Harbor statement. This call is taking place on February 1, 2012. During the course of today's call, forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995, will be made during each speaker’s remarks and during our question-and-answer session. Such statements are based on the company's current assessment of its markets and other factors that affect its business. However, actual results could differ materially from any implied projections due to one or more of the factors explained in Manitowoc's filings with the Securities and Exchange Commission, which are also available on our website.

The Manitowoc Company does not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or other circumstances. With that, I'll now turn the call over to Glen.

Glen E. Tellock

Thanks, Steve, and good morning, everyone. We are pleased to report strong fourth quarter results that marked an end to what was truly a transitional year for Manitowoc in 2011, culminating with impressive year-over-year sales growth of 25% in the fourth quarter. Despite some unexpected turbulence during the year, our focus on execution, coupled with continued progress against our strategic initiatives, helped us reach most of our full year 2011 expectations. In fact, both of our industry-leading businesses delivered higher year-over-year sales and operating earnings, a testament to our ability to navigate an increasingly uncertain global economic environment and fluctuating demand levels that lingered across our markets for a large portion of the year.

Looking at our segment performance. Foodservice continued on its stable and consistent trajectory during the fourth quarter, posting year-over-year sales growth while maintaining healthy margins. Contributing to the positive performance was the market success of our Merrychef ovens and Indigo ice machines, which were launched earlier in the year. The combination of our product offerings within Foodservice, leveraging existing customer relationships and a diverse global footprint has afforded us significant opportunities to drive continued growth in this segment as we move into 2012.

In our Crane segment, the fourth quarter represented the highest year-over-year sales growth since 2007. We also experienced strong order intake levels in the quarter, which will further contribute to our growth as we look ahead. In terms of geographic demand levels, the fourth quarter was similar to previous quarters, with the largest increase in demand occurring in the Americas region, complemented by stronger activity in select emerging markets and the Greater Asia Pacific region. We are encouraged by the activity levels in the fourth quarter, which underscore our belief that we will see continued growth in 2012.

Turning to the new year, our 7 company-wide strategic imperatives remain unchanged. Over the last 12 months, we have spent a fair amount of time providing detail on these initiatives, specifically around innovation, growth, after-market support and operational excellence. As we close out 2011, I want to quickly touch on our customer focus imperative, which remains critical to our positioning in the market and as a key ingredient for our long-term success. For example, project one remains a key initiative in Cranes. While we had curtailed this ERP initiative during the recent recession, this vital project ramps back up to full speed in 2012 with a team of seasoned individuals that will launch implementations for our Crane facilities in Brazil and France, complimented by a global launch spend in our Crane Care operations.

In Foodservice, we will open new test kitchens in India and Singapore to support our customer growth aspirations in these key emerging regions.

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