Sales plunge at Manitou
Manitou has reported a 25 percent decline in first quarter revenues compared to last year.
Total revenues for the period were €421 million, a drop of 25 percent on the same quarter in 2019, at constant exchange rates the reduction is 26 percent. Order intake for new equipment however was almost 11 percent higher at €400 million, taking the order book at the end of the quarter to €648 million although this compares to €884 million at this point last year.
Looking at the three product divisions, the Material Handling & Access business – telehandlers and aerial work platforms - declined 29 percent to €283 million, while the Compact Equipment business - which is largely made up of Gehl and the North American operation – was 24 percent lower at €64 million, and finally the parts and service business was down eight percent to €74 million.
Geographically all four regions saw sharply reduced sales, with Southern Europe - which includes France -falling 29 percent to €152 million, while Northern Europe dropped 27 percent to the same level of €152 million, the Americas 14 percent to €79 million and Asia Pacific 22 percent to €38 million.
The company said: “The Covid-19 crisis led the group to shut down production activities in France, Italy and then India in mid-March, while maintaining - where legislation allowed - the marketing of spare parts and service, as well as the core functions to support its activities. Geographies have been more or less affected by adaptation measures or restrictions on commercial activities. From a business point of view, the strength of the dealer network across all geographies has so far ensured a good resilience of the order book despite the sharp downturn in some markets and geographies. After securing the health and safety of the sites, the French and Italian industrial operations were very gradually reactivated in mid-April. The implementation of new measures and the restarting of the supply chain should impact industrial performance for many months to come.”
Chief executive Michel Denis added: "First quarter business was suddenly interrupted by the globalisation of the Covid-19 crisis, which massively affected the construction sector and, to a lesser extent, the industry. Agricultural demands and service activities remain less impacted due to the greater resilience of these sectors.”
“After reorganising working methods and working hours within organisations, the group has focused its efforts on protecting the safety of its employees and sustaining service to its customers. The gradual reopening of operations initiated in mid April will take time before full fluidity and efficiency are restored. It will remain sensitive to the restarting of the entire supply chain. The first feedback to date is encouraging, which is essential for the group to be able to adapt to the seasonality of its markets.”
“The evolution of the health crisis and its economic impacts are still difficult to measure and do not make it possible to estimate the level of activity for the year at this stage.”
“All of the group's teams are mobilising to support our customers while adapting to new working methods. The year will certainly be very difficult, but I am convinced that the women and men of Manitou will enable the group, thanks to their commitment and responsiveness, to overcome this crisis."
Well what is there to say? Manitou was hit by a double whammy of the sharp global slowdown in demand caused by the crisis itself, compounded by the strict rules in France and Italy which completely shut its plants down for several weeks, with much of its supply chain also affected. The company also lost its smaller plant in India when the government there also took a total closure policy.
The company is in the same boat as most of its competitors and may well benefit sometime in the future – possibly as soon as early next year, as some of the supressed demand comes back on stream and governments look to prime the economic pump with more infrastructure spending.
We are likely to see a good deal more of numbers like this as the first quarter reporting season gets underway in the weeks ahead.