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Ronald De FeoThank you and good morning ladies and gentlemen. Thanks for your interest in Terex today. On the call with me this morning is Phil Widman, our Senior Vice President and CFO; Tom Gelston, Vice President of Investor Relations, and participating on the call and available for your questions will be our leadership team, including our business segment presidents and geographic representation from China and developing markets. As usual, a replay of this call will be archived on the Terex website, www.terex.com, under Audio Archives in the Investor Relations section. I’ll begin with some overall commentary and highlights and Phil will follow with a more detailed financial report, and then of course we’ll open it to your questions. I’d like to request that you ask one question and a follow-up in order to give everyone a chance to participate. For the call, we’ve prepared a presentation guide to the commentary – that’s available on our website. I’m going to begin by referring to the forward-looking statements and the commentary on that relative to Page 2. I encourage you to read and review the materials, as well as other disclosure available in our public documents. So now let me begin on Page 3. Overall, I think we began 2012 quite positively. Simply stated, AWP performance improved markedly, cranes returned to solid profitability, our construction business broke even, our newly acquired materials handling and port solution segment performed as expected, the materials processing business had strong performance and our highest margins, plus we generated solid free cash flow. As I look at the global business environment, it continues to support our 2012 financial plan. Most of our end markets are in recovery mode. North America is performing well, as is Australia. Our road building business in North America continues to be challenged, however, as you know, and our European performance is spotty.
Net sales for the quarter increased 45% or 16% excluding the impact of the MHPS acquisition. All segments contributed positively. Price, pricing actions and cost progress is on track, and importantly we achieved an adjusted $0.29 of earnings per share which Phil will summarize in detail in a couple of minutes.Turning to Page 4 and a bit more about our markets and the environment, if you look at where our net sales came from in the first quarter, we had 37% from North America, reflecting the rebound of the aerial work platform and crane businesses. Western Europe represented only 28%, Asia 10%, Latin America 7%, and 18% other, really reflecting the fairly broad diversification of our revenue geographically. This is something we’ve been working on for many years and it’s good to see, frankly. By segment, our AWP segment was actually our largest segment this quarter with 28% of our revenue, construction 20%, cranes 23%, MHPS 20%, and materials processing 9% - another solid diversification representation on our business by product type. Discussing each segment, our AWP business continues to experience the recovery in the North American rental channel that we’ve all anticipated, as well as strength in Australia. Importantly, we see independent companies returning to purchase equipment again as they represented almost 40% of our sales in the quarter. We continue to see strength in our boom and scissor product lines. In our construction segment, the Terex rigid and articulated truck sales were quite strong globally and the outlook here remains quite positive. We have seen some slowdown in our materials handling or scrap handling product lines as steel prices have moderated somewhat, and this is pretty typical and standard for this product category across the cycle. The North American and Brazilian road building businesses continue to lag. Turning to cranes, our rough terrain crane demand is accelerating, especially in the Americas and in the Middle East. Australia energy-related customers continue to drive growth. Our crawler crane demand has been somewhat soft in western Europe, and as is indicated, the Chinese crane JV, that truck crane JV that we had previously discussed, was restructured in the first quarter with a new partner. The partner is a large state-owned company named SINOMACH that we believe is an important partner for our future. They want this product as part of their portfolio. We also expect to have substantial export opportunities that Terex will lead. This, we believe, will be a good, balanced JV for the future where the JV partner here is committed to the business, where previously our JV partner really was not and was a private investor.
The material handling and port solution segment met our expectations. Industrial cranes were stable and port equipment performed as expected with the service and parts business continuing to be positive, particularly due to high customer capacity utilization. Importantly, the domination agreement became effective as of April 18, 2012 which will allow us to begin the integration process about three to five months ahead of when we had expected the domination agreement to be complete. We continue to target about a $35 million annualized profit improvement as this will offset the step-up amortization of this transaction.Read the rest of this transcript for free on seekingalpha.com