Q2 2024 The Manitowoc Co Inc Earnings Call

August 8, 2024

Unknown Executive: that you limit your questions to one and a follow-up and return to the queue to ensure everyone has an opportunity to ask their question. Please turn to slide two.

Unknown Executive: that you limit your questions to one and a follow-up, and return to the queue to ensure everyone has an opportunity to ask their questions.

Unknown Executive: that you limit your questions to one and a follow up, and return to the queue to ensure everyone has an opportunity to ask their questions.

Unknown Executive: Please turn to slide two. Please note, our safe harbor statement in the material provided for this call. During today's call, forward-looking statements that defined in the Private Securities Litigation Reform Act of 1995 are made 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 or actual projections due to one or more of the factors, among others, described in the company's latest SEC files.

Unknown Executive: Please turn to slide two. Please note, our safe harbor statement in the material provided for this call. During today's call, forward looking statements that defined in the private security litigation reform act of 1995 are made 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 or actual projections, due to one or more of the factors among others, describes in the company's latest SEC files.

Please turn to slide two.

Ion Warner: Please note our Safe Harbor Statement and the materials provided for this call. During today's call, forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 are made based on the company's current assessment of its markets and other factors that affect them. However, actual results could differ materially from any implied or actual projections due to one or more of the factors, among others, described in the company's latest SCC file.

Unknown Executive: Please turn to slide two. Please note our safe harbor statement in the materials provided for this call. During today's call, forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 are made based on the company's current assessment of its markets and other factors that affect them. The Manitowoc Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or other circumstances.

Unknown Executive: The Manitowoc Company does not undertake any obligation to update or revise any forward looking statement, whether the result of new information, future events or other circumstances.

Please note our safe Harbor statement in the material provided for this call.

Ion Warner: The Manitowoc Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or other circumstances.

During today's call forward looking statements as defined in the private Securities Litigation Reform Act of 1095 are made based on the company's current assessment of its markets and other factors that affect its business.

Unknown Executive: However, actual results could differ materially from any implied or actual projections due to one or more of the factors. Among others described in the company's latest SEC filings.

Unknown Executive: The Manitowoc Company does not undertake any obligation to update or revise any forward-looking statement, whether the result of new information, future events, or other circumstances.

Unknown Executive: The Manitowoc company does not undertake any obligation to update or revise any forward looking statement, whether the result of new information future events or other circumstances.

Aaron Ravenscroft: And with that, I will now turn the call over to Aaron. Thank you, Ion, and good morning, everyone. Please move to slide three. Before jumping into my update on the crane market, I would like to provide some color from our Crane Days event in May. First and foremost, it was a very successful event with over 850 customers and dealers visiting our shady growth campus. We hosted attendees from 18 countries, and we showcased 35 cranes, garnering excellent feedback. It takes an enormous team effort to pull one of these events off; a huge thank you to the team involved, and a big thank you to our customers and dealers that showed up in force.

Unknown Executive: And with that, I will now turn the call over to Aaron.

Unknown Executive: And with that I will now turn the call over to Eric.

Aaron Ravenscroft: Thank you, Ion, and good morning, everyone. Please move to slide three. Before jumping into my update on the crane market, I would like to provide some color from our Crane Days event in May. First and foremost, it was a very successful event with over 850 customers and dealers visiting our Shady Grove campus. We hosted attendees from 18 countries, and we showcased 35 cranes, garnering excellent feedback. It takes an enormous team effort to pull one of these events off.

Unknown Executive: Thank you Ian and good morning, everyone. Please move to slide three.

Speaker Change: Before jumping into my update on the Crane market I would like to provide some color from our crane days event in May.

Aaron Ravenscroft: First and foremost, it was a very successful event with over 850 customers and dealers visiting our shady growth campus. We hosted attendees from 18 countries and we showcased 35 cranes, garnering excellent feedback. It takes an enormous team effort to pull one of these events off, a huge thank you to the team involved, and a big thank you to our customers and dealers that showed up in force. Although there was plenty of banter regarding the next six months around the impact of the presidential election cycle, I had multiple customers tell me that they see a wave of infrastructure work on the horizon in the US, and they expect a strong market for the next several years.

Speaker Change: First and foremost it was a very successful event with over 850 customers and dealers visiting our shady Grove campus.

Unknown Executive: We hosted attendees from 18 countries and we showcased 35 cranes garnering excellent feedback.

Speaker Change: It takes an enormous team effort to pull one of these events off a huge thank you to the team involved and a big thank you to our customers and dealers that showed up in force.

Aaron Ravenscroft: A huge thank you to the team involved, and a big thank you to our customers and dealers that showed up and forwarded. Although there was plenty of banter regarding the next six months around the impact of the presidential election cycle, I had multiple customers tell me that they see a wave of infrastructure work on the horizon in the U.S., and they expect a strong market for the next several years. While not reflected in all the public data, crane folks are actively quoting projects for roadwork, bridges, rail, power generation, and power transmission. And, of course, everyone is seeing incredible momentum to build data centers to support the AI boom. These centers will consume massive amounts of electricity, and folks see this as a potential second leg of demand.

Aaron Ravenscroft: Although there was plenty of banter regarding the next six months around the impact of the presidential election cycle, I had multiple customers tell me that they see a wave of infrastructure work on the horizon in the US, and they expect a strong market for the next several years. While not reflected in all the public data, crane folks are actively quoting projects for road work, bridges, rail, power generation, and powered transmission. And of course, everyone is seeing incredible momentum to build data centers to support the AI boom. These centers will consume massive amounts of electricity, and folks see this as a potential second leg of demand.

Speaker Change: Although there was plenty of answer regarding the next six months around the impact of the presidential election cycle I had multiple customers tell me that they see a wave of infrastructure work on the horizon in the U S and they expect a strong market for the next several years.

Aaron Ravenscroft: While not reflected in all the public data, crane folks are actively quoting projects for road work, bridges, rail, power generation, and powered transmission. And of course, everyone is seeing incredible momentum to build data centers to support the AI boom. These centers will consume massive amounts of electricity and folks see this as a potential second leg of demand. Unfortunately, however, we haven't started to see this good news translate in order yet. The current operating environment remains very challenging around the world for sure the geopolitical environment and high interest rates are taking their toll and elections around the world have created even greater uncertainty. Consequently, customers are slow to move forward on orders. In addition, issues such as part shortages and shipping vessel disruptions have improved since the peak of COVID era, but they surely haven't gone away.

Speaker Change: While not reflected in all the public data train folks are actively quoting projects for roadwork bridges rail power generation and power transmission.

Unknown Executive: And, of course, everyone is seeing incredible momentum to build data centers to support the AI boom. Please turn to slide four.

Speaker Change: And of course, everyone is seeing incredible momentum to build data centers to support the IBM <unk>.

Speaker Change: These centers will consume massive amounts of electricity and folks see this as a potential second leg of demand.

Aaron Ravenscroft: Unfortunately, however, we haven't started to see this good news translate in order yet. The current operating environment remains very challenging around the world. For sure, the geopolitical environment and high interest rates are taking their toll, and elections around the world have created even greater uncertainty. Consequently, customers are slow to move forward on orders. In addition, issues such as part shortages and shipping vessel disruptions have improved since the peak of the COVID era, but they surely haven't gone away.

Aaron Ravenscroft: Unfortunately, however, we haven't started to see this good news translate into orders yet. The current operating environment remains very challenging around the world. For sure, the geopolitical environment and high interest rates are taking their toll, and elections around the world have created even greater uncertainty. Consequently, customers are slow to move forward on orders. In addition, issues such as part shortages and shipping vessel disruptions have improved since the peak of the COVID era, but they surely haven't gone away. To recap, orders were down 22% year over year, and total backlog ended the period at a still strong $836 million. Please turn to slide four.

Speaker Change: Unfortunately, however, we haven't started to see this good news translate in orders yet.

Speaker Change: Current operating environment remains very challenging around the world for sure the geopolitical environment and high interest rates are taking their toll and elections around the world have created even greater uncertainty.

Speaker Change: Consequently customers are slow to move forward on orders. In addition issues such as part shortages in shipping vessel disruptions have improved since the peak of Covid era, but they surely haven't gone away.

Aaron Ravenscroft: To recap the second quarter, orders were down 22% year over year, and total backlog ended the period at a still strong $836 million. Please turn to slide four. Starting with the market overview in the Americas, the mobile crane industry remains solid with good utilization. Many of the big crane rental houses are talking about buying new iron, and our quote logs are very strong. Nevertheless, this positive momentum hasn't yet resulted in customer purchasing activity. First, many customers are struggling to find crane operators. I had multiple customers tell me recently that they can't grow their fleets until they can find additional operators.

Aaron Ravenscroft: To recap the second quarter, orders were down 22% year over year and total backlog ended the period at a still strong $836 million. Please turn to slide four. Starting with the market overview in the Americas, the mobile crane industry remains solid with good utilization. Many of the big crane rental houses are talking about buying new iron and our quote logs are very strong. Nevertheless, this positive momentum hasn't yet resulted in customer purchasing activity.

Speaker Change: To recap the second quarter orders were down 22% year over year and total backlog ended the period at a still strong $836 million.

Unknown Executive: Please turn to slide four.

Unknown Executive: Starting with the market overview in the Americas, the mobile crane industry remains solid with good utilization. We, as well as our dealers, have seen an abnormally large number of requests for RPOs or rent-to-purchase deals. I speculate that folks are hesitant to lock in the current interest rates with the expectation that rates will decline. Moving to dealer inventory, current levels in the U.S. are mixed.

Aaron Ravenscroft: Starting with the market overview in the Americas, the mobile crane industry remains solid with good utilization. Many of the big crane rental houses are talking about buying new iron, and our quote logs are very strong. Nevertheless, this positive momentum hasn't yet resulted in customer purchasing activity. First, many customers are struggling to find crane operators. I had multiple customers tell me recently that they can't grow their fleets until they can find additional operators.

Unknown Executive: Starting with the market overview in the Americas, the mobile crane industry remains solid with good utilization.

Speaker Change: Many of the big Crane rental houses are talking about buying new iron and our quote logs are very strong.

Unknown Executive: Nevertheless, this positive momentum hasnt, yet resulted in customer purchasing activity.

Aaron Ravenscroft: First, many customers are struggling to find crane operators. I had multiple customers tell me recently that they can't grow their fleets until they can find additional operators. Second, we as well as our dealers have seen an abnormally large number requests for RPOs or rent a purchase deal. I speculate that folks are hesitant to lock in the current interest rates with the expectations that rates will decline. As I've stated many times, the crane industry always slows down as we approach a US election.

Speaker Change: First many customers are struggling to find crane operators.

Speaker Change: <unk> had multiple customers tell me recently that they can't grow their fleets until they can find additional operators.

Aaron Ravenscroft: Second, we as well as our dealers have seen an abnormally large number of requests for RPOs or rent a purchase deal. I speculate that folks are hesitant to lock in the current interest rates with the expectations that rates will decline. As I've stated many times, the crane industry always slows down as we approach a U.S. election. We clearly saw this in our orders during the second quarter, and I expect to see more of the same in a third quarter. Moving to dealer inventory, current levels in the US are mixed. Rough terrain and altering cranes have been at the high end of the range for several quarters.

Unknown Executive: Second.

Aaron Ravenscroft: We, as well as our dealers, have seen an abnormally large number of requests for RPOs or rent-to-purchase deals. I speculate that folks are hesitant to lock in the current interest rates with the expectation that rates will decline. As I've stated many times, the crane industry always slows down as we approach a U.S. election. We clearly saw this in our orders during the second quarter, and I expect to see more of the same in the third quarter.

Unknown Executive: We as well as our dealers have seen an abnormally large number of requests for <unk> or rent to purchase deals I.

Unknown Executive: I speculate that folks are hesitant to lock in the current interest rates with the expectations that rates will decline.

Unknown Executive: As I've stated many times the crane industry always slows down as we approach a U S election, we clearly saw this in our orders during the second quarter and I expect to see more of the same in the third quarter move.

Aaron Ravenscroft: We clearly saw this in our orders during the second quarter, and I expect to see more of the same in a third quarter. Moving to dealer inventory, current levels in the US are mixed. Rough terrain and altering cranes have been at the high end of the range for several quarters. On the other hand, boom truck dealers in the dealer inventory is at low levels.

Aaron Ravenscroft: Moving to dealer inventory, current levels in the U.S. are mixed. Rough terrain and all-terrain cranes have been at the high end of the range for several quarters. On the other hand, Boom Truck Dealer Inventory is at a low level. In conclusion, crane operators are clearly gaining confidence in the business, and interest in ordering new cranes is strong. At this point, however, we need to get through the election, and any reduction in interest rates would help.

Unknown Executive: Moving to dealer inventory current levels in the U S are mixed rough terrain and altering cranes have been at the high end of the range for several quarters on.

Unknown Executive: Rough terrain and all-terrain cranes have been at the high end of the range for several quarters. In conclusion, crane operators are clearly gaining confidence in the business, and interest in ordering new cranes is strong. At this point, however, we need to get through the election, and any reduction in interest rates would help. New crane orders were down 21% year over year, and Adjusted Ibiza was roughly a $14 million headwind in the quarter.

Aaron Ravenscroft: On the other hand, boom truck dealers in the dealer inventory is at low levels. In conclusion, crane operators are clearly gaining confidence in the business, and interest in ordering new cranes is strong. At this point, however, we need to get through the election, and any reduction in interest rates would help.

Unknown Executive: On the other hand boom truck dealer inventory is at low levels.

Aaron Ravenscroft: In conclusion, crane operators are clearly gaining confidence in the business and interest in ordering new cranes as strong. At this point, however, we need to get through the election, and any reduction in interest rates would help. It sure feels like a crane renaissance, particularly in the US, is just around the corner.

Unknown Executive: In conclusion crane operators are clearly gaining confidence in the business and interest in ordering new cranes is strong at this point, however, we need to get through the election and any reduction in interest rates would help.

Aaron Ravenscroft: It sure feels like a crane renaissance, particularly in the US, is just around the corner.

Aaron Ravenscroft: It sure feels like a Korean Renaissance, particularly in the U.S., is just around the corner. Turning to Europe, it was a tough second quarter, as if the Ukrainian situation wasn't enough upheaval in the region; snap elections and a general concern for previous coalition governments in the UK, France, and Germany led to more uncertainty. Starting with mobile cranes, although orders were surprisingly light during the period, crane activity at large crane rental houses remained strong.

Speaker Change: It sure feels like a train Renaissance, particularly in the U S is just around the corner.

Aaron Ravenscroft: Turning to Europe, it was a tough second quarter. As if the Ukrainian situation wasn't enough upheaval in the region, snap elections and a general concern for previous coalition governments in the UK, France, and Germany have led to more uncertainty. Starting with mobiles, although orders were surprisingly light during the period, crane activity at large crane rental houses remained strong. Similar to the US situation, everyone is talking about large infrastructure projects for energy and rail. While the local daily crane activity has been okay, the continued slowdown in residential and non-residential construction markets, combined with an unclear political environment and higher interest rates, are making it harder and harder for smaller crane rental houses to make purchasing decisions as they look forward.

Unknown Executive: Turning to Europe. It was a tough second quarter as if the Ukrainian situation wasn't enough upheaval in the region.

Speaker Change: <unk> and a general concern for previous coalition governments in the U K, France, and Germany have led to more uncertainty.

Unknown Executive: Starting with mobiles, although orders were surprisingly light during the period train activity at large crane rental houses remains strong.

Aaron Ravenscroft: Similar to the U.S. situation, everyone is talking about large infrastructure projects for energy and rail. While the local daily crane activity has been okay, the continued slowdown in residential and non-residential construction markets, combined with an unclear political environment and higher interest rates, is making it harder and harder for smaller crane rental houses to make purchasing decisions as they look forward. In terms of the European tower crane market, I'm hopeful that we're at the bottom. New crane orders were down 21% year-over-year, and Adjusted Ibiza was roughly a $14 million headwind in the quarter.

Unknown Executive: Over to the U S situation, everyone is talking about large infrastructure projects for energy and rail.

Aaron Ravenscroft: While the local daily crane activity has been okay, the continued slowdown in residential and non-residential construction markets, combined with an unclear political environment and higher interest rates, are making it harder and harder for smaller crane rental houses to make purchasing decisions as they look forward. In terms of the European tower crane market, I'm hopeful that we're at the bottom. New crane orders were down 21% year-over-year, and adjusted even though it was roughly a $14 million-dollar-head one in the quarter.

Unknown Executive: While the local daily Crane activity has been okay. The continued slowdown in residential and nonresidential construction markets combined with an unclear political environment and higher interest rates are making it harder and harder for smaller crane rental houses to make purchasing decisions as they look forward.

Aaron Ravenscroft: In terms of the European tower crane market, I'm hopeful that we're at the bottom. New crane orders were down 21% year-over-year, and adjusted even though it was roughly a $14 million-dollar head one in the quarter. Looking forward, I don't expect any major news in the third quarter given the nature of the summer months in Europe. The fourth quarter should give us some indication of what 2025 will look like. My gut says that the best that we can hope for is a slow recap. In the Middle East, although there's been some negative reports on the press on project postponements, quoting activity remains extremely high, particularly in Saudi.

Unknown Executive: In terms of the European Tower Crane market I'm hopeful that we're at the bottom.

Unknown Executive: New Crane orders were down 21% year over year, and adjusted EBITDA was roughly a $14 million headwind in the quarter.

Aaron Ravenscroft: Looking forward, I don't expect any major news in the third quarter, given the nature of the summer months in Europe. The fourth quarter should give us some indication of what 2025 will look like. My gut says that the best that we can hope for is a slow recovery.

Aaron Ravenscroft: Looking forward, I don't expect any major news in the third quarter given the nature of the summer months in Europe. The fourth quarter should give us some indication of what 2025 will look like. My gut says that the best that we can hope for is a slow recap. In the middle east, although there's been some negative reports on the press on project postponements, quoting activity remains extremely high, particularly in Saudi. Orders were slightly up year-over-year.

Unknown Executive: Looking forward I don't expect any major news in the third quarter, given the nature of the summer months in Europe.

Unknown Executive: The fourth quarter should give us some indication of what 2025 will look like. In the Middle East, although there have been some negative reports in the press on project postponements, quoting activity remains extremely high, particularly in Saudi Arabia. Orders were slightly up year over year. While many pundits are skeptical of Saudi Arabia's current cash flow, we need to keep in mind the immense scope of Saudi Vision 2030. Moreover, Trajana is more than just a ski hill; it's multiple massive projects, of which the centerpiece is a 2.8-kilometer man-made lake that requires building three large dams.

Speaker Change: The fourth quarter should give us some indication of what 2025 will look like my gut says that the best that we can hope for is a slow recovery.

Aaron Ravenscroft: In the Middle East, although there have been some negative reports in the press on project postponements, quoting activity remains extremely high, particularly in Saudi Arabia, and orders were slightly up year over year. While many pundits are skeptical of Saudi's current cash flow, we need to keep in mind the immense scope of Saudi Vision 2030. Even if Saudi Arabia adjusts projects over time to address this cash flow situation, it's important to keep in mind projects like Trajana are underway, and the 2029 Asian Winter Games are only a couple of years away.

Unknown Executive: In the middle East, although theres been some negative reports in the press on project Postponements quoting activity remains extremely high particularly in Saudi.

Aaron Ravenscroft: Orders were slightly up year-over-year. While many pundits are skeptical of Saudi's current cash flow, we need to keep in mind the immense scope of Saudi Vision 2030. Even if Saudi adjusts projects over time to address this cash flow situation, it's important to keep in mind the projects like Tradana are underway. And the 2029 Asia Winter Games are only a couple years away. Moreover, Tradana is more than just a ski hill. It's multiple massive projects, of which the centerpiece is a 2.8-kilometer man-made lake that requires building three large dams. The main dam will be 145 meters high and 475 meters long.

Unknown Executive: Orders were slightly up year over year.

Aaron Ravenscroft: While many pundits are skeptical of Saudi's current cash flow, we need to keep in mind the immense scope of Saudi vision 2030. Even if Saudi adjusts projects over time to address this cash flow situation, it's important to keep in mind the projects like Tradana are underway. And the 2029 Asia winter games are only a couple years away. Moreover, Tradana is more than just a ski hill. It's multiple massive projects of which the centerpiece is a 2.8-kilometer man-made lake that requires building three large dams.

Unknown Executive: While many pundits are skeptical of foundries current cash flow, we need to keep in mind, the <unk> scope of Saudi vision 2030.

Unknown Executive: Even if saudi adjust projects over time to address this cash flow situation. It is important to keep in mind. The projects like <unk> are underway and the 2029 Asia Winter games are only a couple of years away.

Aaron Ravenscroft: Moreover, Trajana is more than just a ski hill; it's multiple massive projects, of which the centerpiece is a 2.8-kilometer man-made lake that requires building three large dams. The main dam will be 145 meters high and 475 meters long.

Unknown Executive: Moreover, <unk> is more than just the scale, it's multiple massive projects of which the centerpiece is at two eight kilometer manmade Lake It requires building three large dams.

Aaron Ravenscroft: The main dam will be 145 meters high and 475 meters long. This is a huge engineering feat. In addition, luxury companies such as Raffles hotels and the Ritz Carlton have begun to make commitments to build accommodations. The transformation of Saudi will surely have its ups and downs, but it's underway and happening.

Unknown Executive: The main dam will be 145 meters high and 475 meters long.

Aaron Ravenscroft: This is a huge engineering feat. In addition, luxury companies such as Raffles Hotels and the Ritz Carlton have begun to make commitments to build accommodations. The transformation of Saudi will surely have its ups and downs, but it's underway and happening.

Aaron Ravenscroft: This is a huge engineering feat. In addition, luxury companies such as Raffles Hotels and the Ritz-Carlton have begun to make commitments to build accommodations. The transformation of Saudi Arabia will surely have its ups and downs, but it's underway and happening. Moving to Asia-Pacific, I recently returned from a two-week visit to the region. The local Chinese market remains very muted, without much new news to report, and this continues to overshadow the region. In addition, delays in South Korean semiconductor facilities and commercial construction projects throughout Southeast Asia have contributed to the regional slowdown.

Unknown Executive: This is a huge engineering feat.

Unknown Executive: In addition, luxury companies such as Raffles hotels, and the Ritz Carlton have begun to make commitments to build a combinations.

Unknown Executive: The transformation of Saudi will surely have its ups and downs, but its underway and happening.

Aaron Ravenscroft: Moving days are specific. I recently returned from a two-week visit to the region. The local China market remains very muted without much new news to report, and this continues to overshadow the region. In addition, delays in South Korean semiconductor facilities and commercial construction projects throughout Southeast Asia have contributed to the regional slowdown. It was good, however, to see that Vietnam and Hong Kong are starting to turn the corner, and I'm optimistic that the South Korean market will begin to turn in 2025. In Australia, customer sentiment is very similar to the US. Crane activity is good, and excitement is starting to grow around the 2030 to Olympics.

Aaron Ravenscroft: Moving days are specific. I recently returned from a two-week visit to the region. The local China market remains very muted without much new news to report, and this continues to overshadow the region. In addition, delays in South Korean semiconductor facilities and commercial construction projects throughout Southeast Asia have contributed to the regional slowdown. It was good, however, to see that Vietnam and Hong Kong are starting to turn the corner and I'm optimistic that South Korean market will begin to turn in 2025.

Unknown Executive: Moving to Asia Pacific I recently returned from a two week visit to the region.

Unknown Executive: Our local China market remains very muted without much new news to report and this continues to overshadow the region.

Unknown Executive: In addition delays in the South Korean semiconductor facilities and commercial construction projects throughout southeast Asia have contributed to the regional slowdown.

Aaron Ravenscroft: It was good, however, to see that Vietnam and Hong Kong are starting to turn the corner, and I'm optimistic that the South Korean market will begin to turn in 2025. In Australia, customer sentiment is very similar to the U.S. Crane activity is good, and excitement is starting to grow around the 2032 Olympics. However, customers are slow to place orders as they juggle high interest rates and wages.

Unknown Executive: It was good however to see that Vietnam, and Hong Kong are starting to turn the corner and I am optimistic that South Korean market will begin to turn in 2025.

Aaron Ravenscroft: In Australia, customer sentiment is very similar to the US. Crane activity is good and excitement is starting to grow around the 2030 to Olympics. The customers are slow to place orders as they juggle high interest rates and wage inflation. Please turn to slide five.

Speaker Change: And Australia customer sentiment is very similar to the U S <unk>.

Unknown Executive: <unk> activity is good and excitement is starting to grow around the 2032 Olympics. The customers are slow to place orders as they juggle high interest rates and wage inflation.

Unknown Executive: Customers are slow to place orders as they juggle high interest rates and wages. Although this decision will negatively impact our short-term financial performance, which was reflected in our updated guidance, it will better position us as we enter 2025.

Aaron Ravenscroft: The customers are slow to place orders as they juggle high interest rates and wage inflation.

Aaron Ravenscroft: Please turn to slide five. The most exciting news from my trip to Asia was our China team's progress on our large tower crane strategy. From a product standpoint, we've sold 14 NCT 1105s, which was the first large crane that we launched last year. We've erected the prototype NCT 2205, which is currently being tested. And I saw several prototype components for the MCR 815, which will be erected in the fourth quarter. Manufacturing these massive cranes team has held several kaisens, including our annual global kaisen, to increase our physical capacity and to improve our overall productivity. A big thank you to Zhang Washi and his team.

Aaron Ravenscroft: Please turn to slide five. The most exciting news for my trip to Asia was our China team's progress on our large tower crane strategy. From a product standpoint, we've sold 14 MCT-1105s, which was the first large crane that we launched last year. We've erected the prototype MCT-2205, which is currently being tested. And I saw several prototype components for the MCR-815, which will be erected in the fourth quarter. To manufacture these massive cranes, the team has held several Kaizens, including our annual Global Kaizen, to increase our physical capacity and improve our overall productivity.

Speaker Change: Please turn to slide five.

Aaron Ravenscroft: The most exciting news from my trip to Asia was our China team's progress on our large tower crane strategy. From a product standpoint, we've sold 14 NCT 1105s, which was the first large crane that we launched last year. We've erected the prototype NCT 2205, which is currently being tested. And I saw several prototype components for the MCR 815, which will be erected in the fourth quarter. Manufacturing these massive cranes team has held several kaisens, including our annual global kaisen to increase our physical capacity and to improve our overall productivity.

Speaker Change: The most exciting news for my trip to Asia was our China team's progress on our large tower crane strategy.

Unknown Executive: From a product standpoint, we sold 14, MCT 1100, fives, which was the first large screen that we launched last year.

Unknown Executive: We've erected the prototype MCT $22, five which is currently being tested.

Unknown Executive: And I saw several prototype components for the MCR 815, which will be erected in the fourth quarter.

Unknown Executive: Manufacture these massive cranes team has held several kaizen, including our annual global Kaizen to increase our physical capacity and to improve our overall productivity.

Aaron Ravenscroft: A big thank you to Zhang Huaxi and his team. On the left side of this slide, you can see some pictures of the area in the factory where we retrofitted the plant to meet the lifting requirements for the big crane.

Aaron Ravenscroft: A big thank you to Zhang Washi and his team. On the left side of this slide, you can see some pictures of the area in the factory where we retrofitted the plant to meet the lifting requirements for the big cranes. On the right is a picture from our recent global kaisen, which was focused on improving our flow, getting a material presentation to increase our output. Turning to our aftermarket business, it continues to do well considering the softness and the global tower crane market, which underscores that our strategy is working.

John <unk>: A big Thank you to John <unk> and his team on.

Aaron Ravenscroft: On the left side of this slide, you can see some pictures of the area in the factory where we retrofitted the plant to meet the lifting requirements for the big cranes. On the right is a picture from our recent global Kaisen, which was focused on improving our flow, getting a material presentation to increase our output. Turning to our aftermarket business, it continues to do well considering the softness in the global tower crane market, which underscores that our strategy is working. Our non-new machine sales in the second quarter were $147 million, only slightly down year over year.

Speaker Change: On the left side of this slide you can see some pictures of the area and the factory, where we retrofitted the plant to meet the lifting requirements for the big cranes.

Brian Regan: On the right is a picture from our recent global Kaizen, which was focused on improving our flow, kitting, and material presentation to increase our outcome. Turning to our aftermarket business, it continues to do well considering the softness in the global tower crane market, which underlines that our strategy is working. Our non-new machine sales in the second quarter were $147 million, only slightly down year-over-year. During the quarter, I visited our MGX Phoenix and Salt Lake City branches, and I was extremely impressed by how these teams are servicing customers, such as the local mines, through superior field service support.

Unknown Executive: On the right is a picture from our recent global Kaizen, which was focused on improving our flow hitting in material presentation to increase our output.

Unknown Executive: Turning to our aftermarket business. It continues to do well considering the softness in the global tower Crane market, which underscores that our strategy is working.

Aaron Ravenscroft: Our non new machine sales in the second quarter were $147 million, only slightly down year over year. During the quarter, I visited our MGX Phoenix and Salt Lake City branches, and I was extremely impressed by how these teams are servicing customers, such as the local mines, through superior, build service support.

Unknown Executive: Our non new machine sales in the second quarter were $147 million only slightly down year over year.

Aaron Ravenscroft: During the quarter, I visited our MGX Phoenix and Salt Lake City branches, and I was extremely impressed by how these teams are servicing customers, such as the local mines, through superior, build service support.

Speaker Change: During the quarter I visited our Mdx, Phoenix and Salt Lake City branches and I was extremely impressed by how these teams are servicing customers such as the local mines through superior field service support at <unk>.

Aaron Ravenscroft: A big thank you to Robert Thomas and the on-cornery, our branch managers and their teams. I think this is a good point to summarize where we sit for the months of the year. Orders were lower than anticipated in the second quarter, and I expect order levels to remain depressed until we get through the US election. After weighing the lower demand with our elevated inventory, we adjusted our build schedule to support our year and recast low target. Although this decision will negatively impact our short-term financial performance, which was reflected in our updated guidance, it will better position us as we enter 2025.

Brian Regan: A big thank you to Robert Thomas and Leon Cornaby, our branch managers, and their teams. I think this is a good point to summarize where we stand for the balance of the year. Orders were lower than anticipated in the second quarter, and I expect order levels to remain depressed until we get through the U.S. election. After weighing the lower demand with our elevated inventory, we adjusted our build schedule to support our year-end pre-cash flow target. Although this decision will negatively impact our short-term financial performance, which was reflected in our updated guidance, it will better position us as we enter 2025. With that, I'll turn it over to Brian.

Speaker Change: Thank you to Robert Thomas and Leon corn of our branch managers and their teams.

Unknown Executive: I think this is a good point to summarize where we sit for the balance of the year orders were lower than anticipated in the second quarter and I expect order levels to remain depressed until we get through the U S election.

Unknown Executive: After weighing the lower demand with our elevated inventory, we adjusted our build schedule to support our year end free cash flow target.

Unknown Executive: Although this decision will negatively impact our short term financial performance, which was reflected in our updated guidance it will better position us as we enter 2025.

Brian Regan: With that, I'll turn it over to Brian. Thanks, Aaron, and good morning everyone. Please move to slide six. During the period, we had orders of $428 million, a decrease of 22% from a year ago, bringing our June 30th backlog to $836 million. The lower order intake was primarily in our Americas and European businesses, while midterm and long-term customer sentiment remains high. Prolonged higher interest rate environment and the political uncertainty around the world has negatively impacted the near term demand. Net sales in the quarter were $562 million, a decrease of 7% from a year ago. As it relates to our expectation going into the quarter, we missed our net sales significantly.

Brian Regan: With that, I'll turn it over to Brian.

Unknown Executive: With that I'll turn it over to Brian.

Brian Regan: Thanks, Aaron, and good morning, everyone. During the period, we had orders of $428 million, a decrease of 22% from a year ago, bringing our June 30th backlog to $836 million. The lower order intake was primarily in our Americas and European business. While midterm and long-term customer sentiment remains high, the prolonged higher interest rate environment and the political uncertainty around the world have negatively impacted near-term demand.

Brian Regan: Thanks Aaron, and good morning everyone.

Unknown Executive: Thanks, Aaron and good morning, everyone. Please move to slide six.

Brian Regan: Please move to slide six. During the period, we had orders of $428 million, a decrease of 22% from a year ago, bringing our June 30th backlog to $836 million. The lower order intake was primarily in our Americas and European businesses, while midterm and long-term customer sentiment remains high, prolonged higher interest rate environment, and the political uncertainty around the world has negatively impacted the near term demand. Net sales in the quarter were $562 million, a decrease of 7% from a year ago.

Unknown Executive: During the period, we had orders of $428 million.

Unknown Executive: A decrease of 22% from a year ago, bringing our June 30 backlog to $836 million.

Unknown Executive: The lower order intake was primarily in our Americas and European business. Number three, a variety of customer financing issues, and number four, lower than expected demand for certain products. This was a great accomplishment considering the European tower crane market is at 2009 levels. After adjusting for charges related to the EPA legal matter, SG&A as a percentage of sales was 14%, up 120 basis points year over year. This was primarily driven by lower sales in the period.

Unknown Executive: The lower order intake was primarily in our Americas and European businesses.

Unknown Executive: While midterm and long term customer sentiment remains high and prolonged higher interest rate environment and the political uncertainty around the world has negatively impacted the near term demand.

Brian Regan: Net sales in the quarter were $562 million, a decrease of 7% from a year ago. As it relates to our expectation going into the quarter, we missed our net sales by significantly. This was driven by four major items. Number one was Part Shorty.

Unknown Executive: Net sales in the quarter were $562 million or.

Unknown Executive: A decrease of 7% from a year ago.

Brian Regan: As it relates to our expectation going into the quarter, we missed our net sales significantly. This was driven by four major items. Number one, part shortages. Number two, logistics and vessel disruptions. Number three, a variety of customer financing issues. Number four, lower than expected demand for certain products.

Unknown Executive: As it relates to our expectation going into the quarter, we missed our net sales significantly.

Brian Regan: This was driven by four major items. Number one, part shortages. Number two: logistics and vessel disruptions. Number three, a variety of customer financing issues. Number four, lower than expected demand for certain products. Our non-new machine sales were $147 million during the quarter, slightly down year-over-year. This was a great accomplishment considering the European tower crane market, at 2009 levels. After adjusting for charges related to the EPA legal matter, S-GNA as a percentage of sales was 14%, up 120 basis points year-over-year. This was primarily driven by lower sales in the period. Our adjusted EBITDA for the second quarter was $36 million.

Brian Regan: Number 2, Logistics and Vessel Disruption. Number three, a variety of customer financing issues, and number four, lower than expected demand for certain products. Our non-new machine sales were $147 million during the quarter, slightly down year over year. This was a great accomplishment considering the European tower crane market is at 2009 levels.

Unknown Executive: This was driven by four major items number one parts shortages number two logistics and vessel disruptions number three a variety of customer financing issues and number four lower than expected demand for certain products.

Brian Regan: Our non-new machine sales were $147 million during the quarter, slightly down year-over-year. This was a great accomplishment considering the European tower crane market, at 2009 levels. After adjusting for charges related to the EPA legal matter, S-GNA as a percentage of sales was 14% up 120 basis points year-over-year. This was primarily driven by lower sales in the period.

Unknown Executive: Our non new machine sales were $147 million during the quarter slightly down year over year.

Unknown Executive: This was a great accomplishment considering the European tower Crane market is at 2009 levels.

Brian Regan: After adjusting for charges related to the EPA legal matter, SG&A as a percentage of sales was 14%, up 120 basis points year over year. This was primarily driven by lower sales in the period. Our adjusted EBITDA for the second quarter was $36 million, and the adjusted EBITDA margin was 6.4%, a decrease of 360 basis points from the prior year. The European tower crane business continues to be the major headwind with a year over year impact on adjusted EBITDA of $14 million.

Unknown Executive: After adjusting for charges related to the EPA legal matter SG&A as a percentage of sales was 14% up 120 basis points year over year. This was primarily driven by lower sales in the period.

Unknown Executive: Our adjusted EBITDA for the second quarter was $36 million. Adjusted EBITDA margin was 6.4%, a decrease of 360 basis points from the prior year. Moving to cash flows, we generated $11 million of cash from operating activities during the quarter. Capital expenditures were $13 million, of which $6 million was for our rent.

Brian Regan: Our adjusted EBITDA for the second quarter was $36 million. The adjusted EBITDA margin was 6.4%, a decrease of 360 basis points from the prior year. European tower crane business continues to be the major headwind for the year-over-year impact to adjusted EBITDA for $14 million.

Unknown Executive: Our adjusted EBITDA for the second quarter was $36 million. The adjusted EBITDA margin was six 4% a decrease of 360 basis points from the prior year.

Brian Regan: The adjusted EBITDA margin was 6.4%, a decrease of 360 basis points from the prior year. European tower crane business continues to be the major headwind for the year-over-year impact to adjusted EBITDA for $14 million. Our gap deluded income per share on the quarter was 4 cents. On an adjusted basis, deluded income per share was 25 cents, a decrease of 50 cents year-over-year.

Unknown Executive: European Tower Crane business continues to be the major headwind for the year over year impact to adjusted EBITDA of $14 million.

Brian Regan: Our gap deluded income per share on the quarter was 4 cents. On an adjusted basis, deluded income per share was 25 cents, a decrease of 50 cents year-over-year.

Brian Regan: Our gap diluted income per share in the quarter was $0.04. On an adjusted basis, diluted income per share was $0.25, a decrease of $0.50 year over year. Please turn to slide seven, networking capital at the end of the quarter at $517 million 24% as a percentage of trailing 12 month sales. The main driver for our increase in working capital continues to be inventory, driven primarily by the sales miss in the second quarter. As Aaron mentioned, we reduced our 2024 build schedule, which will take effect in the second half to help us achieve our year-end inventory target. Moving to cash flows, we generated $11 million of cash from operating activities during the quarter. Capital expenditures were $13 million, of which $6 million was for our rent.

Unknown Executive: Our GAAP diluted income per share in the quarter was <unk> <unk> on an adjusted basis diluted income per share was <unk> 25 a.

Unknown Executive: A decrease of 50 year over year.

Brian Regan: Please turn to slide 7. Networking capital ended the quarter at $517 million, 24% as a percentage of trailing 12-month sales. The main driver for our increase in working capital continues to be inventory, driven primarily by the sales miss in the second quarter. As Aaron mentioned, we reduced our 2024 build schedule, which will take effect in the second half to help us achieve our year-end inventory target. Moving to cash flows, we generated $11 million of cash from operating activities during the quarter. Capital expenditures were $13 million, of which $6 million was for our rental fleet. During the quarter, we repurchased roughly 478,000 shares for $6 million, effectively buying back our creep.

Unknown Executive: Please turn to slide seven.

Unknown Executive: Net working capital ended the quarter at 517 million, 24% as a percentage of trailing 12 month sales.

Unknown Executive: The main driver for our increase in working capital continues to be inventory driven primarily by the sales Miss in the second quarter.

Unknown Executive: As Aaron mentioned, we reduced our 2024 build schedule, which will take effect in the second half and help us achieve our yearend inventory target.

Brian Regan: Moving to cash flows, we generated $11 million of cash from operating activities during the quarter. Capital expenditures were $13 million, of which $6 million was for our rental fleet. During the quarter, we repurchased roughly 478,000 shares for $6 million, effectively buying back our creep. In the second half, we will opportunistically look to repurchase additional shares while managing our leverage. We have $29 million remaining under our current authorization. Our cash balance was $38 million and total liquidity was $226 million at the end of the quarter, relatively unchanged from the first quarter. Our net leverage ratio was 2.8 times, which was a reflection of the lower trailing 12-month EBDA and the higher working capital.

Unknown Executive: Moving to cash flows we generated $11 million of cash from operating activities. During the quarter capital expenditures were $13 million of which $6 million was for our rental fleet.

Brian Regan: During the quarter, we repurchased roughly 478,000 shares for $6 million, effectively buying back our CREEP. In the second half, we will opportunistically look to repurchase additional shares while managing our leverage. We have $29 million remaining under our current authorization. Our cash balance was $38 million, and total liquidity was $226 million at the end of the quarter, relatively unchanged from the first quarter. Our net leverage ratio was 2.8 times, which is a reflection of the lower trailing 12-month EBITDA and the higher working capital. As it relates to our debt, our high-yield notes are due in April 2026. While it's important to provide specifics, we continue to evaluate our options. Please move to slide eight.

Unknown Executive: During the quarter, we repurchased roughly 478000 shares for $6 million effectively buying back our creek and the.

Brian Regan: In the second half, we will opportunistically look to repurchase additional shares while managing our leverage. We have $29 million remaining under our current authorization. Our cash balance was $38 million and total liquidity was $226 million at the end of the quarter, relatively unchanged from the first quarter. Our net leverage ratio was 2.8 times, which was a reflection of the lower trailing 12-month EBDA and the higher working capital. As it relates to our debt, our high yield notes are due in April 2026. Although it is true to provide specifics, we continue to evaluate our options.

Unknown Executive: Second half, we will opportunistically look to repurchase additional shares while managing our leverage we have $29 million remaining under our current authorization.

Unknown Executive: Our cash balance was $38 million and total liquidity was $226 million.

Unknown Executive: At the end of the quarter relatively unchanged from the first quarter of.

Unknown Executive: Our net leverage ratio was two eight times, which is a reflection of the lower trailing 12 month, EBITDA and the higher working capital.

Brian Regan: As it relates to our debt, our high yield notes are due in April 2026, although it is true to provide specifics, we continue to evaluate our options.

Unknown Executive: As it relates to our debt our high yield notes are due in April 2026.

Unknown Executive: Sure to provide specifics we continue to evaluate our options.

Brian Regan: Please move to slide 8. When we set our budget, we expected difficult comparisons in the first half as a result of the slowdown in our European tower crane business. We also assume the slight rebound in this part of the business in the second half and expected strong mobile demand throughout the year. At this time, it's pretty clear that the European tower crane business will remain at low levels the remainder of the year. In addition, mobile crane orders across our segments have tempered. As such, we've adjusted our full year 2024 guidance as noted on slide 8.

Unknown Executive: Please move to slide eight.

Brian Regan: When we set our budget, we expected difficult comparisons in the first half as a result of the slowdown in our European tower crane business. We also assumed a slight rebound in this part of the business in the second half and expected strong mobile demand throughout the year. At this time, it's pretty clear that the European tower crane business will remain at low levels for the remainder of the year.

Unknown Executive: When we set our budget, we expected difficult comparisons in the first half as a result of the slowdown in our European Tower Crane business. We also assumed a slight rebound in this part of the business in the second half and expected strong mobile demand throughout the year.

Speaker Change: At this time, it's pretty clear that the European tower Crane business will remain at low levels. The remainder of the year. In addition, mobile crane orders across our segments September.

Brian Regan: In addition, mobile crane orders across our segments have... As such, we've adjusted our full year 2024 guidance as noted on slide 8. Net sales of $2.175 to $2.25 billion. Adjusted EBITDA of $125 to $140 million. Adjusted diluted earnings per share of 45 cents to $0.90, and free cash flows of $30 to $50 million. With that, I will now turn the call back.

Brian Regan: As such, we've adjusted our full year 2024 guidance as noted on slide 8. Net sales of $2.175 to $2.25 billion. A generosity of $125 to $140 million. Adjust the diluted earnings per share of $0.45 to $0.90. Free cash flows of $30 to $50 million.

Unknown Executive: As such we've adjusted our full year 2024 guidance as noted on slide eight.

Brian Regan: Net sales of $2.175 to $2.25 billion. A generosity of $125 to $140 million. Adjust the diluted earnings per share of $0.45 to $0.90. Free cash flows of $30 to $50 million.

Unknown Executive: Net sales of $2 175 to 2.25 billion.

Unknown Executive: Adjusted EBITDA of $125 million to $140 million adjusted diluted earnings per share of <unk> 45 to 90.

Unknown Executive: Free cash flows of $30 million to $50 million with that I will now turn the call back to Eric.

Aaron Ravenscroft: With that, I will now turn the call back to Aaron.

Aaron Ravenscroft: With that, I will now turn the call back to Aaron. Thanks, Brian.

Brian Regan: Thanks, Brian. Please turn to slide nine.

Aaron Ravenscroft: Thanks, Brian.

Unknown Executive: Thanks, Brian Please turn to slide nine.

Aaron Ravenscroft: Please turn to slide 9. Entering the year, we knew that 2024 would be an uphill battle, particularly after a great 2023. While the year hasn't played out as expected, I'm very encouraged by the resilience of our non-new machine sales and the growing positive sentiment of many of our core marks. markets. And although we haven't seen the European tower crane business turn the corner yet, as John Templeton said, cool markets are born on pessimism and grow on skepticism. Regardless, Manitowoc is a significantly better company today than when we became a standalone crane company eight years ago.

Aaron Ravenscroft: Please turn to slide 9. Entering the year, we knew that 2024 would be an uphill battle, particularly after a great 2023. While the year hasn't played out as expected, I'm very encouraged by the resilience of our non-new machine sales and the growing positive sentiment of many of our core marks, markets. And although we haven't seen the European tower crane business turn the corner yet, as John Templeton said, cool markets are born on pessimism and grow on skepticism.

Unknown Executive: Entering the year, we knew that 2024 would be an uphill battle, particularly after a great 2023. While the year hasn't played out as expected, I'm very encouraged by the resilience of our non-new machine sales and the growing positive sentiment in many of our core markets. And although we haven't seen the European tower crane business turn the corner yet, as John Templeton said, bull markets are born on pessimism and grow on skepticism. By any standard, that's a great accomplishment and puts us in a much better position to drive shareholder value over the long term.

Aaron Ravenscroft: Entering the year, we knew that 2024 would be an uphill battle, particularly after a great 2023. While the year hasn't played out as expected, I'm very encouraged by the resilience of our non-new machine sales and the growing positive sentiment in many of our core markets. And although we haven't seen the European tower crane business turn the corner yet, as John Templeton said, bull markets are born on pessimism and grow on skepticism.

Speaker Change: Entering the year, we knew that 2024 would be an uphill battle, particularly after a great 2023, while the year Hasnt played out as expected I'm very encouraged by the resilience of our non new machine sales and the growing positive sentiment in many of our core markets.

Unknown Executive: And although we haven't seen the European tower Crane business turned the corner yet as John Templeton said well markets are born on pessimism and grow on skepticism.

Aaron Ravenscroft: Regardless, Manitowoc is a significantly better company today than when we became a standalone crane company eight years ago. The Manitowoc Way, combined with our Cranes Plus 50 strategy, has transformed the company, and we are still in the early innings of the game. I would remind everyone that since we launched Cranes Plus 50, we've grown our higher-margin, less cyclical aftermarket business by 34%. By any standard, that's a great accomplishment and puts us in a much better position to drive shareholder value over the long term. With that, I'll open it up to questions.

Aaron Ravenscroft: Regardless, Manitowoc is a significantly better company today than when we became a standalone crane company eight years ago. The Manitowoc way to mind with our crane's plus 50 strategy has transformed the company when we are still in the early endings of the game. I would remind everyone that since we launched crane's plus 50, we've grown our higher margins less cyclical aftermarket business by 34%. By any standard, that's a great accomplishment and puts us in a much better position to drive shareholder value long-term.

Unknown Executive: Regardless Manitowoc is a significantly better company today than when we became a standalone Crane company eight years ago.

Aaron Ravenscroft: The Manitowoc way to mind with our crane's plus 50 strategy has transformed the company when we are still in the early endings of the game. I would remind everyone that since we launched Crane's Plus 50, we've grown our higher margins, less cyclical aftermarket business by 34%. By any standard, that's a great accomplishment and puts us in a much better position to drive shareholder value long-term.

Speaker Change: The Manitowoc way combined with our cranes was 50 strategy has transformed the company and we are still in the early innings of the game.

Speaker Change: I would remind everyone that since we launched <unk> plus 50, we've grown our higher margin less cyclical aftermarket business by 34%.

Unknown Executive: By any standard that's a great accomplishment and puts us in a much better positioned to drive shareholder value long term.

Unknown Executive: With that, I'll open it up to questions.

Unknown Executive: With that, I'll open it up to questions. Thank you. At this time, I would like to remind everyone in order to ask a question, press star, then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster.

Speaker Change: With that I'll open it up to questions.

Unknown Executive: Thank you.

Operator: Thank you. At this time, I would like to remind everyone in order to ask a question, press star then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Steve Volkmann with Jeffries. Your line is open. Morning, Steve.

Speaker Change: Thank you at this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad.

Unknown Executive: At this time, I would like to remind everyone that in order to ask a question, press star, then the number one on your telephone keypad. We'll pause for just a moment to compile the Q&A roster.

Speaker Change: For just a moment to compile the Q&A roster.

Steve Volkman: Your first question comes from the line of Steve Volkman with Jefferies. Your line is open. Good morning, Steve. Good morning, guys. Thank you for taking the question.

Steve Volkman: Your first question comes from the line of Steve Volkman with Jeffries. Your line is open. Good morning, Steve. Good morning, guys. Thank you for taking the question. So kind of interesting sort of near-term long-term dichotomy here because it feels like things really sort of zagged on you in the quarter here.

Unknown Executive: Your first question comes from the line of Steve Volkmann with Jefferies. Your line is open good morning, Steve and Steve.

Stephen Volkmann: Good morning, guys. Thank you for taking the time to answer the question. So, kind of an interesting sort of near-term and long-term dichotomy here because it feels like things really sort of zagged on you in the quarter here. So I guess my first question is, you know, what really changed in the last 90 days that really moved us so aggressively? And the second thing is, Aaron, it feels like you're actually more optimistic these days, and I'm curious, what's pivoted there that's made you kind of more optimistic, if I'm reading your tone, right? Yeah, I knew he's-

Speaker Change: Good morning, guys. Thank you for taking the question so yeah.

Aaron Ravenscroft: So kind of interesting sort of near-term long-term dichotomy here because it feels like things really sort of zagged on you in the quarter here. So I guess my first question is, you know, what really changed in the last 90 days that really moved us so aggressively? And the second thing is Aaron, it feels like you're actually more optimistic sort of the out years. And I'm curious what pivoted there that's made you kind of more optimistic, if I'm reading your tone right? Yeah, I mean, we still continue to have all these big opportunities for large infrastructural projects.

Speaker Change: Kind of interesting sort of near term long term dichotomy here because it feels like things really sort of zagged on you in the quarter here. So I guess my first question is what really changed in the last 90 days that really moved so aggressively in the second thing is Aaron it feels like Youre actually more opt in.

Aaron Ravenscroft: So I guess my first question is, you know, what really changed in the last 90 days that really moved us so aggressively? And the second thing is Aaron, it feels like you're actually more optimistic sort of the out years. And I'm curious what pivoted there that's made you kind of more optimistic if I'm reading your tone, right? Yeah, I mean, we still continue to have all these big opportunities for large infrastructural projects.

Unknown Executive: Mist.

Unknown Executive: Nick.

Speaker Change: The out years and I am curious whats whats pivoted. There. That's made you kind of more optimistic if I'm reading your tone right yes.

Aaron Ravenscroft: Yeah, I mean, we still continue to have all these big opportunities for large infrastructural projects. I mean, you saw yesterday, there was a bill that came out for, I think $2.2 billion for power transmission. So when we talk to folks in the business, I mean, I talk about power transmission specifically, and our dealer in the Northeast told us they'd see work in that space for the next 10 years. So, I mean, these big bills are finally starting to come through.

Speaker Change: Yes, I mean, we still continue to have all these big opportunities for large infrastructural projects. We saw yesterday. There was a bill that came out for I think $2 2 billion for power transmission. So when we talk to folks in the business.

Aaron Ravenscroft: And we saw yesterday there was a bill that came out for, I think, $2.2 billion per power transmission. So when we talk to folks in the business, I mean, we talk about power transmission specifically in our dealer and the Northeast, total states. He worked in that space for the next 10 years potentially. So I mean, there's these big bills are finally starting to come through. And those big activities also are big generators of crane activities. So long-term rain optimistic, I think that hasn't changed. It's good to hear that the crane operators are actually starting to see some of this activity, which we hadn't really seen or heard much about.

Aaron Ravenscroft: And we saw yesterday there was a bill that came out for, I think, $2.2 billion per power transmission. So when we talk to folks in the business, I mean, we talk about power transmission specifically in our dealer and the Northeast, total states, he worked in that space for the next 10 years potentially. So I mean, there's these big bills are finally starting to come through. And those big activities also are big generators of crane activities. So long-term rain optimistic, I think that hasn't changed. It's good to hear that the crane operators are actually starting to see some of this activity, which we hadn't really seen or heard much about.

Unknown Executive: I talk about power transmission specifically in our dealer in the Northeast total states he worked in that space for the next

Speaker Change: Talking about powertrains mission, specifically in our dealer in the northeast total Stacy work in that space for the next 10 years potentially so I mean, there is these big builders finally, starting to come through and those big activity is also a big generators of crane activity. So long term remain optimistic.

Aaron Ravenscroft: And those big activities also are big generators of crane activity. So, long term, remain optimistic. I think that hasn't changed. It's good to hear that the crane operators are actually starting to see some of this activity, which we hadn't really seen or heard much about. But in the short term, really, it's the electric, the election curse, as I see it. I mean, this was just sort of tapped off in May, and it's still really been.

Unknown Executive: That hasnt changed.

Speaker Change: It's good to hear that the crane operators are actually starting to see some of this activity, which we hadn't really seen or heard much about but in the short term really it's the electric the election curves as I see it I mean.

Steve Volkman: But in a short term, really, it's the electric, the election curse as I see it. I mean, this is just sort of tapped off in May, and it's still really been depressed. I mean, our July orders were 121 million just to keep it in perspective. So, and of course, with all of the things that we've seen in the U.S. election and interstate discussions in the last couple of weeks, I think that just really hurts confidence in the short term for people to pull the trigger on new orders. Okay. All right, thanks.

Steve Volkman: But in a short term, really, it's the electric, the election curse as I see it. I mean, this is just sort of tapped off in May and it's still really been depressed. I mean, our July orders were 121 million just to keep it in a perspective. So and of course, with all of the things that we've seen in the U.S, election and interstate discussions in the last couple of weeks, I think that just really hurts confidence in the short term for people to pull the trigger on new orders. Okay. All right, thanks.

Speaker Change: Business, just sort of tapped off in may and its still really been dipped.

Aaron Ravenscroft: Maynard July orders were $121 million, just to keep it in perspective. And of course, with all of the things that we've seen in the U.S. election and interest rate discussions in the last couple weeks, I think that just really hurts confidence in the short term for people to pull the trigger on new orders.

Speaker Change: Depressed I mean, our July orders were $121 million is to keep it in perspective so.

Speaker Change: And of course with all of the.

Speaker Change: Things that we've seen in the U S election, and interest rate discussions in the last couple of weeks.

Speaker Change: I think that just really hurts confidence in the short term or to pull the trigger on new orders.

Aaron Ravenscroft: Okay. All right. Thanks. Anything to call out sort of on competitive dynamics or price, cost, and any headwinds there we should know about?

Speaker Change: Okay alright. Thanks.

Aaron Ravenscroft: Anything to call out, sort of on competitive dynamics or price cost, and any headwinds there we should know about? Yeah, I mean, on an Asia Pac and in the Middle East where we compete with the Chinese, that definitely has gotten more aggressive. So there's been a little bit of price compression in terms of our normal Western markets.

Aaron Ravenscroft: Anything to call out sort of on competitive dynamics or price cost and any headwinds there we should know about? Yeah, I mean, on an Asia pack and in the Middle East where we compete with the Chinese, that definitely has gotten more aggressive. So there's been a little bit of price compression in terms of our normal western markets. I wouldn't say anything's changed. Yeah, I'd say just it was nice to see the back of Japan raise interest rates and then, you know, the end, and you know, Trayvon a bit, but it's still pretty high, so from a competitive standpoint, that's definitely still in Magnus. All right. Thank you, guys. Thanks, Steve.

Unknown Executive: Thing to call out sort of on the competitive dynamics or price cost in any headwinds there we should know about.

Aaron Ravenscroft: Yeah, I mean, in the Asia pack and in the Middle East, where we compete with the Chinese, that definitely has gotten more aggressive. So there's a little bit of price compression in terms of our normal Western markets. But I wouldn't say anything's changed.

Unknown Executive: Yes.

Unknown Executive: On Asia Pac and in the Middle East, where we compete with the Chinese that definitely has gotten more aggressive.

Speaker Change: So theres been a little bit of price compression in terms of our normal western markets I wouldn't say anything's changed.

Aaron Ravenscroft: I wouldn't say anything's changed. Yeah, I'd say just it was nice to see the back of Japan raise interest rates and then, you know, the end. and you know, Trayvon a bit, but it's still pretty high, so from a competitive standpoint, that's definitely still in Magnus.

Unknown Executive: Yeah, I'd say it was nice to see the Bank of Japan raise interest rates and the yen, you know, straightened a bit, but it's still pretty high. So from a competitive standpoint, that's definitely still impacting us.

Speaker Change: I'd say it was nice to see the bank of Japan raise interest rates in the yen.

Unknown Executive: Treatment.

Speaker Change: But still it.

Speaker Change: Pretty high and so from a competitive standpoint, that's definitely still impacting us.

Steve Volkman: All right. Thank you, guys.

Speaker Change: Alright, Thank you guys.

Unknown Executive: Thanks, Steve.

Unknown Executive: <unk>.

Operator: Your next question comes from the line of MacDobro with Baird. Your line is open.

Mick Dobre: Your next question comes from the line of Mick Dobre with Baird. Your line is open. Morning, Meg. Thank you. Yeah, good morning. Thank you for taking the question. Apologize on the sick here. So hopefully you can hear me. Okay. I guess my first question. Just a little bit on understanding the, the cadence here for the back half, 3Q versus 4Q. You had to adjust your production and we understand that, but you know, there are more pronounced effect in one quarter versus the other and you know what's the right way to think about margins. Also, thank you.

Speaker Change: Your next question comes from the line of Mike Gilbert with Baird. Your line is open.

Meg Dobro: Good morning, Meg. Thank you for taking the question. I apologize. I'm a bit sick here, so hopefully, you can hear me okay.

MacDobro: Thank you.

MacDobro: Good morning, Thank you for taking my question I apologize.

Speaker Change: Six years so.

MacDobro: Hopefully you can hear me okay.

Unknown Executive: I guess my first question... Just a little bit on understanding the cadence here for the back half. 3Q versus 4Q. You had to adjust your production, and we understand that. But, you know, is there a more pronounced effect in one quarter versus the other? And, you know, what's the right way to think about margins? Also, thank you.

MacDobro: I guess my first question.

Mick Dobre: Just a little bit on understanding the, the cadence here for the back half, 3Q versus 4Q. You had to adjust your production, and we understand that. But you know, there are more pronounced effects in one quarter versus the other, and you know what's the right way to think about margins. Also, thank you. Yeah, you know, seasonally Q3 is always our weakest quarter. So I'd say, you know, that's definitely going to still happen, in particular in Europe, and obviously the tower crane business continues to be soft for us. So Q3 is going to be a lower quarter than Q4 to 4.

Speaker Change: Just a little bit.

Operator: Understanding.

Speaker Change: Cadence fuel for the backhaul.

Speaker Change: Thank you versus <unk>.

Speaker Change: <unk> had to adjust your production we understand that.

Operator: <unk>.

Speaker Change: There were more pronounced.

MacDobro: In one quarter versus the other and what's the right way to think about margins.

MacDobro: Also thank you yes.

Unknown Executive: Yeah, you know, seasonally, Q3 is always our weakest quarter. So I'd say that's definitely going to happen, in particular in Europe.

Aaron Ravenscroft: Yeah, you know, seasonally Q3 is always our weakest quarter. So I'd say, you know, that's definitely going to still happen in particular in Europe and obviously the tower crane business continues to be soft for us. So Q3 is going to be a lower quarter than Q4 to 4. We tend to be a bit stronger. So just from a, from a cadence standpoint, you know, I'd expect Q4 to be higher revenue, higher margin, quarter than Q3. And we don't, obviously we don't give quarterly guidance, but I'd say just directly that's what I would expect. Okay.

Unknown Executive: Yes, you know, seasonally, Q3 is the best.

Speaker Change: Yes, seasonally Q3 is always our weakest quarter. So I'd say, that's definitely going to still happen.

Operator: In particular in Europe, and obviously the tower Crane business continues to be soft for us. So Q3 is going to be.

Speaker Change: A lower quarter than Q4, Q4, we tend to be a bit stronger. So just from a from a cadence standpoint, I would expect Q4 to be higher revenue higher margin quarter than Q3.

Brian Regan: We tend to be a bit stronger. So just from a, from a cadence standpoint, you know, I'd expect Q4 to be a higher revenue, higher margin quarter than Q3. And we don't, obviously, we don't give quarterly guidance, but I'd say just directly that's what I would expect.

Unknown Executive: And, you know, obviously, the tower crane business continues to be soft for us. So Q3 is going to be a lower quarter than Q4. Q4, we tend to be a bit stronger. So just from a cadence standpoint, you know, I'd expect Q4 to be a higher revenue, higher margin quarter than Q3. And we don't, obviously, we don't give quarterly guidance, but I'd say just directionally. That's what I would expect.

Speaker Change: And we don't obviously, we don't give quarterly guidance, but I would say just directionally, that's what I would expect.

Operator: Okay.

Mick Dobre: Okay. And then, you know, maybe, maybe I guess to follow up on these questions about the tone, Aaron's tone longer term. And I don't know, maybe, maybe to challenge that a little bit. I guess if we're, if we're looking at what we've experienced here in say 2023 and 2024, you know, this period has really been some of the strongest level of activity and non-residential construction in the US that needs ever seen. The manufacturing vertical is growing materially because of mega project. Even on the public side, we have seen very, very robust bending in street and highway in 23, and all of this is now the celebrating in 24. And certainly, the start seemed to be pointing to lower levels of activity.

Unknown Executive: Okay. And then, you know, maybe, maybe I guess I should follow up on Steve's questions about, about the tone, Aaron's tone, in the long term. And I don't know, maybe maybe to challenge that a little bit, I guess if we're, if we're looking at what we've experienced here in say, 2023 and 2024, you know, this period has really been some of the strongest. The level of activity and non-residential construction in the US has never seen the manufacturing vertical has grown materially because of megaprojects.

Speaker Change: Okay. Okay.

Mick Dobre: And then, you know, maybe, maybe I guess to follow up on these questions about about the tone, Aaron's tone longer term. And I don't know, maybe maybe to challenge that a little bit. I guess if we're, if we're looking at what we've experienced here in say 2023 and 2024, you know, this period has really been some of the strongest level of activity and non residential construction in the US that needs ever seen the manufacturing vertical is growing materially because of mega project.

Speaker Change: And then on.

MacDobro: Maybe maybe I guess to follow up on Steve's question was about.

Speaker Change: About the tone aaron's to longer term.

Speaker Change: And I don't know, maybe maybe you could challenge that a little bit I guess, if we're if we're looking at what we've experienced here in 2023 and into 2024.

Speaker Change: This period has really been some of the strongest.

Speaker Change: Level of activity in nonresidential construction in the U S that we won't see that manufacturing vertical has grown materially because of Mega project, even though on the public side, we have seen very very robust spending in the street and highway in 'twenty three.

Mick Dobre: Even on the public side, we have seen very, very robust, bending in street and highway in 23 and all of this is now the celebrating in 24 and certainly the start seemed to be pointing to lower levels of activity. So I guess I'm curious on two things. First, why do you think we haven't seen a more robust level of ordering and trained demand despite construction being as good as it's been. And then, you know, how comfortable can we be with this notion that from current level, there's going to be yet another leg up yet another really free acceleration that can support the man.

MacDobro: And all of this is now the celebrating and 44 in particularly the stars seem to be pointing to lower levels of activity. So I guess I'm curious on two things first.

Unknown Executive: Even on the public side, we have seen very, very robust, peddling on the street and highway in 23, and all of this is now the cellar race. Unknown Speaker And certainly, the starts seem to be pointing to lower levels of activity. So I guess I'm curious on two things first. Why do you think we haven't seen a more robust level of ordering and crane demand, despite construction being as good as it's been?

Aaron Ravenscroft: So I guess I'm curious on two things. First, why do you think we haven't seen a more robust level of ordering and trained demand, despite construction being as good as it's been. And then, you know, how comfortable can we be with this notion that from current level, there's going to be yet another leg up, yet another really free acceleration that can support the man. And I'll probably get there. Thank you. Yeah. So, first of all, with respect to commercial construction, if you go back to 16 and 17, it was up 20%. That, meanwhile, crane orders were flatish.

MacDobro: Why do you think we haven't seen a more robust level of ordering training demand despite construction being as good as it's been.

Unknown Executive: And then, you know, how comfortable can we be with this notion that from current levels, there's going to be yet another leg up, yet another reacceleration that can support it? And I'll leave it there. Thank you.

Speaker Change: And then.

MacDobro: How comfortable can we be with this notion that from current levels. There is going to be yet another leg up yet another reacceleration that can support demand.

Speaker Change: And I'll leave it there. Thank you yes so.

MacDobro: Yeah, so first of all, with respect to commercial construction, if you go back to 16 and 17, it was up 20%. Meanwhile, crane orders were flattish. I mean, that was a pretty weak period for us. We got a lot of questions during those days about that level of activity.

Unknown Executive: Yeah, so first of all, with respect to commercial construction, if you go back to 16 and 17, it was up 20%. Meanwhile, crane orders were flattish. I mean, that was a pretty weak period for us.

Mick Dobre: And I'll probably get there. Thank you. Yeah. So, first of all, with respect to commercial construction, if you go back to 16 and 17, it was up 20% that meanwhile crane orders were flatish. I mean, that was pretty weak period force. We got a lot of questions during those days about that level of activity. So, and there's no real strong correlation with when we look through the data relative to the crane business relative to non residential segments.

MacDobro: So first of all with respect to commercial construction.

Speaker Change: You go back to 16 and 17 it was up 20%. Meanwhile, clean orders were flattish I mean that was pretty weak period for us we got a lot of questions. During those days about that level of activity. So.

Unknown Executive: We got a lot of questions during those days about that level of activity. So And there's no real strong correlation when we look through the data relative to the crane business relative to non-residential segments. So yeah, we definitely see the data is unfavorable there, which was more favorable. Relative to why did we not see stronger demand? I think that's largely driven by the interest rate environment in the last 12 months.

Brian Regan: I mean, that was a pretty weak period force. We got a lot of questions during those days about that level of activity. So, and there's no real strong correlation with when we look through the data relative to the crane business relative to non-residential segments. So, yeah, we definitely see the day is unfavorable there, which was more favorable relative to why did we not see stronger demand. And I think that's largely driven by the interest rate environment. in the last 12 months. So longer term, there's still lots of these big projects that have not been executed.

MacDobro: And there is no real strong correlation when we look through the data relative to the crane business relative to nonresidential segments. So.

Mick Dobre: So, yeah, we definitely see the day is unfavorable there, which was more favorable relative to why did we not see stronger demand. And I think that's largely driven by the interest rate environment, in the last 12 months. So longer term, there's still lots of these big projects that have not been executed. I mean, it's taking forever to get permitting for these big projects. And if you look overall, the fleet age still remains in that mid teens, at all the major large crane rental houses.

Speaker Change: Yes, we definitely see the data is unfavorable their wish it was more favorable relative to why did we not see stronger demand and I think thats largely driven by the interest rate environment.

Unknown Executive: So longer term, there's still lots of these big projects that have not been executed. I mean, it's taking forever to get permits for these big projects. And if you look overall, the fleet age still remains in the mid-teens at all the major large crane rental houses. So at some point, that has to be addressed.

MacDobro: In the last 12 months so.

MacDobro: Longer term there is still lots of these big projects that have not been executed.

Brian Regan: I mean, it's taking forever to get permitting for these big projects. And if you look overall, the fleet age still remains in that mid teens, at all the major large crane rental houses. So, at some point, that has to be addressed. And we've said in the past that our customers buy on confidence. And you know, we had crane days during the quarter, and the sentiment was very positive. As Aaron mentioned, you know, we visited a customer in the Northeast, and there was huge positivity coming out of it about these projects. And really, the extent of what they see as demand.

Speaker Change: Taking forever to get permitting.

MacDobro: For these big projects and if you look overall rental the fleet age still remains in that mid teens and all of the major large crane rental houses. So at some point that has to be addressed.

Mick Dobre: So at some point, that has to be addressed. And we've said in the past that our customers buy on confidence. And you know, we had crane days during the quarter and the sentiment was very positive. As Aaron mentioned, you know, we visited a customer in Northeast and there was huge positivity coming out of it about these projects. And really the extent of what they see as demand. So, you know, you can look at all the data. And as Aaron mentioned, we don't have any, we've not seen any correlation between our order rates and that data. But, you know, it's really about customer confidence. And we see it as pretty positive.

Unknown Executive: And we've said in the past that our customers buy with confidence. And, you know, we had crane days during the quarter, and the sentiment was very positive. As Aaron mentioned, you know, we visited a customer in the Northeast, and there was huge positivity coming out of it about these projects and really the extent of what they see as demand. So, you know, you can look at all the data, and as Aaron mentioned, we've not seen any correlation between our order rates and that data, but, you know, it's really about customer confidence, and we see it as pretty darn positive.

Unknown Executive: And we've said in the past that our customers buy on confidence.

Mick Dobre: Okay. Thank you very much and good luck.

MacDobro: And we've said in the past.

MacDobro: Our customers buy on confidence.

Unknown Executive: Thanks.

MacDobro: And we had crane days during the quarter and the sentiment was very positive.

Aaron: Aaron mentioned it.

Speaker Change: As a customer in the northeast.

Unknown Executive: There was huge positivity coming out of it about these projects and really the extent of that.

Speaker Change: What they see is demand so no.

Mick Dobre: So, you know, you can look at all the data. And as Aaron mentioned, we don't have any; we've not seen any correlation between our order rates and that data. But, you know, it's really about customer confidence. And we see it as pretty positive. Okay.

IRA: You can look at all the data and as IRA mentioned, we don't have any we've not seen any correlation between our order rates and that data but.

Unknown Executive: It's really about customer confidence and we see as pretty darn positive.

Unknown Executive: Okay, thank you very much, and good luck.

Mick Dobre: Thank you very much, and good luck. Thanks.

Speaker Change: Okay. Thank you very much and good luck.

Nick: Thanks, Nick.

Clay Rebitch: Your next question comes from the line of Jerry Rebitch with Goldman Sachs. Your line is open. Morning, Jerry. Hi, this is Clay on. Hi, this is Clay on for Jerry.

Operator: Your next question comes from the line of Jerry Rebich with Goldman Sachs. Your line is open.

Clay Williams: Your next question comes from the line of Jerry Rebitch with Goldman Sachs. Your line is open. Morning, Jerry. Hi, this is Clay on. Hi, this is Clay on for Jerry. Quick question on the rent of purchase options. You know, how, how high are those relative to the normal levels? And then, you know, what are the typical conversion rates in around the rent of purchase? That is interesting to see if the levels are higher there than normal.

Unknown Executive: Your next question comes from the line of Jerry Revich with Goldman Sachs. Your line is open.

Jerry Rebich: Morning, Jerry. Hi, this is Clay. This is Clay on behalf of Jerry.

Unknown Executive: Jerry Hi, Joe Hi, this is clay.

Clay Nelson: Quick question on the rent to purchase options, you know, how high are those relative to normal levels? And then, you know, what are the typical conversion rates, you know, around the rent to purchase. That is interesting to see if the levels are higher there than normal, if we can, you know, those can, you know, improve on the conversions, you know, once we get past the election, or if interest rates change.

Clay: Hi, This is clay on for Jay a quick question on the rent to purchase options. How high are those relative to normal levels and then what are the typical conversion rates in or around the rent to purchase.

Clay Rebitch: Quick question on the rent of purchase options. You know, how high are those relative to the normal levels? And then, you know, what are the typical conversion rates in around the rent of purchase? That is interesting to see if the levels are higher there than normal. If we get a, you know, those kind of, you know, prove on the conversions, you know, once we get past the election or if it just rates change.

Speaker Change: To see if the levels are higher than normal if we can.

Clay Williams: If we get a, you know, those kind of, you know, prove on the conversions, you know, once we get past the election or if it just rates change. Yeah, that's much more anecdotal in terms of having data to specifically answer your question. But I mean, in a normal course, there's certain. Crane rental houses just like to do RPOs as part of their financing. So that normal has changed where you got a lot of folks who normally just buy the cranes are actually asking for RPOs.

Speaker Change: It does kind of improve on the conversions you know once we get past the election or if interest rates change.

Aaron Ravenscroft: Yeah, that's much more anecdotal in terms of having data to specifically answer your question. But I mean, on a normal course, there are certain... Crane Rental Houses just like to do RPOs as part of their financing. So that normal has changed where you've got a lot of folks who normally just buy the cranes, and they're actually asking for RPOs. I'd say it's a discussion that comes up almost every single day or single order, and we

Aaron Ravenscroft: Yeah, that's much more anecdotal in terms of having data to specifically answer your question. But I mean, in a normal course, there's certain. Crane rental houses just like to do RPOs as part of their financing. So that normal has changed where you got a lot of folks who normally just buy the cranes are actually asking for RPOs. I'd say it's a discussion that comes up once every single day or single order. Yeah. Yeah, even with some of our dealers, we know that, yeah, that they do RPOs. Well, yeah. And we, you know, again, anecdotally, we just equated to the fact that they don't want to commit to a purchase.

Speaker Change: Yes, that's much more anecdotal in terms of having data to specifically answer your question, but I mean in a normal course theres certain clean.

Speaker Change: Crane rental houses I'd, just like to do <unk> as part of their financing so.

Speaker Change: That normal has changed where you've got a lot of folks who normally just by the trains are actually asking for ipos.

Clay Williams: I'd say it's a, it's a discussion that comes up once every single day or single order. Yeah. Yeah, even with some of our dealers, we know that, yeah, that they do RPOs. Well, yeah. And we, you know, again, anecdotally, we just equated to the fact that they don't want to commit to a purchase. If they feel like interest rates are going down and it feels like interest rates are coming down.

Speaker Change: I'd say, it's a it's a discussion that comes up every single day or single orders, yet even with some of our dealers we know.

Speaker Change: But they do RVO as well yes.

Unknown Executive: <unk>.

Speaker Change: Again anecdotally, we just equated to the fact that they don't want to commit to a purchase.

Aaron Ravenscroft: If they feel like interest rates are going down, and it feels like interest rates are coming down, so, you know, I would anticipate, kind of in line with the election cycle, that post-election, there should be more free purchases than.

Aaron Ravenscroft: If they feel like interest rates are going down and it feels like interest rates are coming down.

Speaker Change: If they feel like interest rates are going down and it feels like interest rates are coming down so I would anticipate.

Aaron Ravenscroft: So, you know, I would anticipate, you know, kind of in line with the election cycle that post election, there should be more free purchases than rent.

Clay Williams: So, you know, I would anticipate, you know, kind of in line with the election cycle that post election, there should be more free purchases than rent. Thanks.

Speaker Change: Kind of in line with the election cycle that post election, there should be more repurchases.

Speaker Change: Rent to own.

Clay Rebitch: Thanks.

Unknown Executive: Thanks, and separately, you know, how big of an impact the park shortages you called out in the quarter and what a non-new machine sales would have been, you know, assuming, you know, a normal supply. [inaudible] Yeah, I'd say, you know, I listed out about the

Unknown Executive: Thanks. And separately, you know, how big of an impact were the parts shortages you called out in the quarter? And what could a non-new machine sales have been, you know, assuming you know, a normal supply? Yeah, I'd say, you know, I listed out about the

Aaron Ravenscroft: And as separately, you know, how big of an impact with the park shortages you called out in the quarter and what could a non new machine sales have been, you know, assuming, you know, a normal supply. Yeah, I'd say, you know, I listed out about the four different impacts to our quarter based on where we, where we forecasted. And when you look at across, you know, book to bill commercial logistics and execution with, with park shortages being part of execution, it's about 25, 25, 25, 25. So it's sort of even and, and, and our, our internal mist during the quarter was just under a hundred million dollars.

Unknown Executive: Thanks.

Clay Williams: And as separately, you know, how big of an impact with the park shortages you called out in the quarter and what could a non new machine sales have been, you know, assuming, you know, a normal supply. Yeah, I'd say, you know, I listed out about the four different impacts to our quarter based on where we, where we forecasted. And when you look at across, you know, book to bill commercial logistics and execution with, with park shortages being part of execution, it's about 25, 25, 25, 25. So it's sort of even and, and, and our, our internal mist during the quarter was just under a hundred million dollars. Thanks, El Paso.

Unknown Executive: Separately.

Speaker Change: <unk> have an impact with a part shortages you called out in the quarter and what could or non new machine sales have been assuming a normal supply.

Unknown Executive: Yeah, I'd say, you know, I listed out about the four different impacts to our quarter based on where we where we forecasted. And when you look at across, you know, book to bill commercial logistics and execution, with part shortages being part of execution, it's about 25-25, 25-25. So sort of even and an hour.

Unknown Executive: Yeah, I'd say, you know, I listed out about the four different impacts to our quarter based on where we where we forecasted. And when you look at across, you know, book to bill, commercial logistics, and execution, with part shortages being part of execution, it's about 2525 2525. So sort of even and an hour. Our internal miss during the quarter was just under $100 million.

Speaker Change: Yes, I'd say.

Unknown Executive: I listed out about.

Speaker Change: Four different <unk>.

Unknown Executive: Impacts to our quarter based on where we where we forecasted and when you look at across book to Bill commercial logistics and execution.

Unknown Executive: With part shortages being part of execution, it's about $25 $25 $25 25, so it's sort of even in an hour.

Unknown Executive: Our internal mis during the quarter was just under $100 million.

Clay Rebitch: Thanks, El Paso.

Speaker Change: Thanks, I'll pass it on.

Steven Fisher: Your next question comes from the line of Steven Fisher with UBS. Your line is open. Which the thanks. Good morning.

Steven Fisher: Your next question comes from the line of Steven Fisher with UBS. Your line is open. Which the thanks.

Operator: Your next question comes from the line of Steven Fisher with UBS. Your line is open.

Unknown Executive: Your next question comes from the line of Steven Fisher with UBS. Your line is open when Steve Thanks, Good morning.

Steven Fisher: Good morning, Steve. Thanks. Good morning. Good morning. Just to follow up on the last question about some of the parts shortages and other operational challenges that you mentioned, what kind of visibility do you have for any improvements in those areas?

Steven Fisher: Good morning. I've just to follow up on the last question there about some of the the park shortages and other operational challenges that you mentioned. What kind of visibility do you have to any improvements in those areas? Yeah, I mean, the commercial items and the financing is something that we always, it's something we always have to manage through because they're big, you know, big, expensive assets and that's a process. It's just it's gotten worse and I think that will continue probably the remainder of the year that will continue about all getting, make sure we have all the paperwork.

Brian Regan: I've just to follow up on the last question there about some of the park shortages and other operational challenges that you mentioned. What kind of visibility do you have to any improvements in those areas? Yeah, I mean, the commercial items and the financing is something that we always, it's something we always have to manage through because they're big, you know, big, expensive assets, and that's a process. It's just it's gotten worse, and I think that will continue probably the remainder of the year. That will continue about all getting, make sure we have all the paperwork.

Speaker Change: Hey, good morning.

Speaker Change: To follow up on the last question there about some of the parts shortages and other operational challenges that you mentioned, what kind of visibility do you have to improve.

Unknown Executive: Improvements in those areas.

Unknown Executive: Yeah, I mean, the commercial items and the financing is something that we always have to manage through because they're big, you know, big expensive pieces of assets, and that's the process. It's just gotten worse. And I think that will continue probably the remainder of the year as we continue to battle getting make sure we have all the paperwork. Of course, the banks are also asking for more information that they have. In terms of part shortages, 6,000 parts on a GM case, and it only takes one to stop the crane, and we still have as many shortages as we had a year ago, I'd say.

Unknown Executive: Yes, I mean, the commercial items in the financing is something that we always.

Unknown Executive: It's something we always have to manage through because they're big, you know, big, expensive pieces of assets, and that's the process. It's just gotten worse. And I think that will continue probably for the remainder of the year, as we continue to battle getting make sure we have all the paperwork. Of course, the banks are also asking for more information that they have.

Unknown Executive: We always have to manage through because there are big clinic basements pieces of assets and that's the process is just it's gotten worse.

Unknown Executive: I think that will continue probably the remainder of the year that will continue to battle getting make sure. We have all the paperwork is or the banks are also asking for for more information that they had passed.

Brian Regan: Of course, the banks are also asking for more information than they had in the past. In terms of parts shortages, the 6,000 parts on GMKs and only takes one to stop the crane, and we still have as many shortages we had a year ago, I'd say. And we're still saying that for certain, for our boom trucks, some chassis issues and things like that. So that's, you know, an area where demand is continue to be strong, yet there's issues with parts and chassis.

Steven Fisher: Of course, the banks are also asking for more information than they had in the past. In terms of parts shortages, the 6,000 parts on GMKs and only takes one to stop the crane and we still have as many shortages we had a year ago, I'd say. And we're still saying that for certain, for our boom trucks, some chassis issues and things like that. So that's, you know, an area where demand is continue to be strong, yet there's issues with parts and chassis.

Unknown Executive: In terms of parts shortages the.

Speaker Change: 6000 parts on GM case, it only takes one to stop the crane.

Unknown Executive: We still have as many shortages, we had a year ago I would say.

Unknown Executive: And we're still saying that for certain for our boom trucks and chassis issues and things like that. So that's, you know, an area where demand continues to be strong, yet there are issues with.

Speaker Change: And we're still saying hey.

Unknown Executive: For certain for our boom trucks and chassis issues and things like that so that's an area where demand has continued to be strong.

Unknown Executive: There is issues with parts.

Unknown Executive: <unk>.

Steven Fisher: Okay, that's helpful, and then just a couple of quick clarifications.

Unknown Executive: Okay, that's helpful. And then just a couple of quick clarifications. Did you have any order cancellations or deferrals during the quarter? And from a pricing perspective, are you expecting any pricing declines year over year in the second half of the year? Yeah, we had one.

Steven Fisher: Okay, that's helpful and then just a couple of quick clarifications. Did you have any order cancellations or deferrals during the quarter and from a pricing perspective, are you expecting any pricing declines year every year, the second half of the year. Thank you. Yeah, we had one crane that was canceled, but it was I wouldn't say that was abnormal. That happens from time to time. So I'm not too concerned around cancellations. And in terms of pricing, I mean, I think where we compete with the Chinese will continue to be aggressive, but in terms of the core product lines in the West, I don't expect any degradation in your term.

Speaker Change: Okay. That's helpful. And then just a couple of quick clarifications did you have any order cancellations or deferrals during the quarter.

Brian Regan: Did you have any order cancellations or deferrals during the quarter, and from a pricing perspective, are you expecting any pricing declines year every year, the second half of the year. Thank you. Yeah, we had one crane that was canceled, but it was I wouldn't say that was abnormal. That happens from time to time. So I'm not too concerned around cancellations.

Speaker Change: And from a pricing perspective are you expecting any pricing declines year over year in the second half of the year. Thank you.

Unknown Executive: Terrific. Thank you very much. Thank you. Again, if you would like to ask a question, press star, the number one on your telephone keypad.

Speaker Change: Yes, we had one.

Unknown Executive: Crane was cancelled, but I wouldn't say that was abnormal. That happens from time to time.

Unknown Executive: Crane that was canceled but it was.

Unknown Executive: I wouldn't say that was abnormal that happens from time to time, so I'm not too concerned around cancellations and in terms of pricing.

Unknown Executive: So I'm not too concerned about cancellations and, in terms of pricing, I mean, I think where we compete with the Chinese, prices will continue to be aggressive. But in terms of the core product lines in the West, I don't expect any degradations there.

Brian Regan: And in terms of pricing, I mean, I think where we compete with the Chinese will continue to be aggressive, but in terms of the core product lines in the West, I don't expect any degradation in your term. Terrific.

Unknown Executive: I think where we compete with the Chinese will continue to be aggressive but in terms of the.

Unknown Executive: The core product lines in the West I don't expect.

Unknown Executive: Any degradation in the near term.

Unknown Executive: Terrific. Thank you very much.

Steven Fisher: Thank you very much.

Speaker Change: Terrific. Thank you very much.

Unknown Executive: Thank you.

Steve: Thanks, Steve.

Unknown Executive: Again, if you would like to ask a question, press star, the number one on your telephone keypad.

Operator: Again, if you would like to ask a question, press star then number one on your telephone keypad. Your next question comes from the line of Tami Zakaria of J.P. Morgan. Your line is open.

Speaker Change: Again, if you would like to ask a question Press Star then the number one on your telephone keypad.

Tami Zakaria: Your next question comes from the line of Tammy Zakaria of JP Morgan. Your line is open morning. Hi, good morning. Hi, how are you? So two quick questions. One is I think I remember last year. You, in one of the calls, you mentioned that cranes are now call it 20% plus more expensive because of cost inflation, and then you add on the increase in interest rates. So that whole cost barred burden sort of damp and demand relative to the prices we've seen for crane pre pandemic. So I was wondering, can you update us where we are now in terms of pricing, including the financing cost for crane.

Tami Zakaria: Your next question comes from the line of Tammy Zakaria of JP Morgan. Your line is open morning. Hi, good morning. Hi, how are you? So two quick questions. One is I think I remember last year. You in one of the calls you mentioned that cranes are now call it 20% plus more expensive because of cost inflation and then you add on the increase in interest rates. So that whole cost barred burden sort of damp and demand relative to the prices we've seen for crane pre pandemic.

Unknown Executive: Your next question comes from the line of Tami Zakaria of Jpmorgan. Your line is open good morning, Tim.

Tami Zakaria: Morning, Tami. Hi, good morning.

Tami Zakaria: Hi, good morning. How are you?

Speaker Change: Good morning.

Tami Zakaria: So two quick questions. One is, I think I remember last year on one of the calls, you mentioned that cranes are now 20% plus more expensive because of cost inflation, and then you add on the increase in interest rates. So that whole cost burden, burden, sort of dampens demand. Relative to the prices we've seen for cranes pre-pandemic, So I was wondering, can you update us on where we are now in terms of pricing, including the financing costs for cranes? What I'm trying to understand is what degree of rate cuts is needed for cranes to see a pickup in demand?

Speaker Change: Hi, how are you.

Speaker Change: So two quick question one.

Unknown Executive: One is I think I remember last year.

Speaker Change: You and one of the calls you mentioned that cranes are now call it 20% plus more expensive.

Unknown Executive: Cost inflation, and then you add on the increase in interest rate.

Unknown Executive: So that whole cost burden sort of dampen demand.

Speaker Change: Relative to the prices, we've seen for crane and pre pandemic. So I was wondering can you update us where we are now in terms of pricing, including the financing cost per claim.

Tami Zakaria: So I was wondering, can you update us where we are now in terms of pricing, including the financing cost for crane. What I'm trying to understand is what degree of rate cuts is needed for cranes to see a pickup and demand again. Yeah, I mean, I would say it hasn't really changed from a pricing standpoint. I mean, I have to do the math. I mean, you had zero to 1% interest rates.

Aaron Ravenscroft: What I'm trying to understand is what degree of rate cuts is needed for cranes to see a pickup in demand again. Yeah, I mean, I would say it hasn't really changed from a pricing standpoint. I mean, I have to do the math. I mean, you had zero to 1% interest rates. A couple of years back, and now you're talking five, six percent. So I'd have to go back to when we actually set it and update the model, but like over the last year. I mean, you can look at what interest rates have done and do the math.

Speaker Change: What I'm trying to understand is.

Speaker Change: What degree of rate cuts is needed for <unk> to see a pickup in demand again.

Unknown Executive: Yeah, I mean, I wouldn't say it hasn't really changed from a pricing standpoint. You may have to do the math, but when you had zero to 1% interest rates a couple years back, and now you're talking about 6%. So yeah, that

Speaker Change: Yes, I mean, I would say it hasnt really changed from a pricing standpoint to do the math and yet zero to 1% interest rates a couple of years back and now you're talking about 6%. So I'd have to go back to when we actually set it and update our model but.

Tami Zakaria: A couple of years back and now you're talking five, six percent. So I'd have to go back to when we actually set it and update the model, but like over the last year. I mean, you can look at what interest rates have done and do the math. But I think part of it is just that expectation that interest rates are going to come down. So why would you do it? I mean, when we talked about the US in particular, we were surprised to see order rates stay as strong as they were because of those interest rates and because of those dynamics. I think the much bigger issue we have right now is certainty.

Unknown Executive: over the last year. I mean, you could look at what interest rates have done and do the math. But I think part of it is just the expectation that interest rates are going to come down. So why would you do it? I mean, when we talked about the U.S., in particular, we were surprised to see order rates stay as strong as they were because of those interest rates and because of those dynamics. And I think a much bigger issue.

Speaker Change: Over the last year I mean, you can look at what interest rates have gone in and do the math, but I think.

Aaron Ravenscroft: But I think part of it is just that expectation that interest rates are going to come down. So why would you do it? I mean, when we talked about the US in particular, we were surprised to see order rates stay as strong as they were because of those interest rates and because of those dynamics.

Speaker Change: Part of it is just that expectation that interest rates are going to come down. So why would you do it I mean, when we talked about the U S. In particular, we were surprised to see order rates stay as strong as they were because of those interest rates because of those dynamics.

Unknown Executive: Got it. Got it. That's helpful.

Unknown Executive: And I think the much bigger issue we have right now is certainty. I mean, the election is turning into an election situation and wars continuing in Ukraine and the Middle East. So until we get some certainty around those items and even the interest rates, we don't really know where we're at.

Aaron Ravenscroft: I think the much bigger issue we have right now is certainty. I mean, the election is. turn into the election situation and the wars continuing to rake Ukraine in the Middle East.

Unknown Executive: I think it's a bunch of bigger issue, we have right now uncertainty.

Aaron Ravenscroft: I mean, the election is. Turn into the election situation, and the wars continue in Ukraine and in the Middle East. So until we get some certainty around those items and even the interest rates, we don't really know where we're headed. So. Got it, got it. That's helpful.

Speaker Change: The election is.

Unknown Executive: turn to the election situation, and wars continue in Ukraine and the Middle East. So until we get some certainty around those items and even the interest rates, we don't really know where we're headed.

Unknown Executive: Turning to the election situation in the <unk>.

Speaker Change: <unk> continue in Ukraine, and the middle East So until we get some certainty around those items and even the interest rates.

Tami Zakaria: So until we get some certainty around those items and even the interest rates, we don't really know where I have it. So, got it. Got it. That's helpful.

Unknown Executive: We don't really know around so.

Unknown Executive: And then the other question is non-new machine sales. I think I heard you say it was down a bit in the second quarter. How did that trend versus your original expectation? And do you expect non-new machine sales to stay down for the rest of the year? Yeah, I

Speaker Change: Got it got it that's helpful. And then the other question is non new machine sales I think I heard you say it was down a bit in the second quarter.

Brian Regan: And then the other question is non-new machine sales. I think I heard you say it was down a bit in the second quarter. How did that transverse your original expectation, and do you expect non-new machine sales to stay down for the rest of the year? Yeah, I think we're pretty proud of where we are from a non-new machine sales perspective, in particular with the tower crane business where it is. You know, there's definitely down in tower cranes, but not as far down as where you'd expect it relative to where the new machines are. So, I think it's around where we expected, a little bit shorter really, based on some timing on some use machines.

Unknown Executive: And then the other question is non-new machine sales. I think I heard you say it was down a bit in the second quarter. How did that transition versus your original expectation? [inaudible] it's, it's

Speaker Change: How did that trend versus your.

Speaker Change: Origin excitation and do you expect non new machine sales.

Speaker Change: <unk> down for the rest of the year.

Unknown Executive: Yeah, I think, you know, we're pretty proud of where we are from a non-new machine sales perspective, in particular with The Tower Crane business, where it is, there's definitely down in tower cranes, but not as far down as you'd expect it relative to where the new machines are. So, you know, I think it's, It's, it's around where we expected it to be a little bit shorter really based on some timing on some used machines. But year over year, the down is really related to our tower.

Speaker Change: Yes, I think we're.

Speaker Change: Pretty proud of where we are from a non new machine sales perspectives in particular with the tower Crane business, where it is.

Speaker Change: There is there definitely.

Speaker Change: Down in tower cranes, but not as not as far down as where you'd expected relative to where the new machines are so I think I think it's it's.

Speaker Change: It's <unk>.

Speaker Change: Around where we expected a little bit shorter really based on some timing on on some used machines.

Tami Zakaria: But year over year, the down is really related to our towers business. Understood. Thank you. Thanks, Tammy.

Speaker Change: But year over year, the down is really related to our to our towers business.

Speaker Change: Understood. Thank you.

Tammy: Thanks Tammy.

Unknown Executive: There are no further questions at this time.

Unknown Executive: Fair.

Unknown Executive: There are no further questions at this time, Mr. Warner I'd turn the call back over to you. Thank you before we conclude today's call. Please note that a replay of our second quarter 2024 conference call will be available later this morning by accessing the Investor Relations section of our website at <unk>.

Ion Warner: Mr. Warner, I turn the call back over to you. Thank you.

Operator: Thank you. Before we conclude today's call, please note that a replay of our second quarter 2024 conference call will be available later this morning by accessing the investor relations section of our website at manitowoc.com.

Unknown Executive: understood. Thank you.

Unknown Executive: Before we conclude today's call, please note that a replay of our second quarter 2024 conference call will be available later this morning by accessing the Investor Relations section of our website at Manitlock.com. Thank you for everyone for joining us today and for your continuing interest in the Manitlock Company. We look forward to speaking with you again next quarter.

Operator: Manitowoc Dot com.

Operator: There are no further questions at this time. Mr. Warner, I turn the call back over to you. Thank you. Before we conclude today's call, please...

Operator: You for everyone for joining us today and for your continuing interest in the Manitowoc company.

Unknown Executive: Before we conclude today's call, please note that a replay of our second quarter 2024 conference call will be available later this morning by accessing the investor relations section of our website at manitowoc.com. Thank you everyone for joining us today and for your continuing interest in the Manitowoc Company. We look forward to speaking with you.

Operator: This concludes today's conference call. You may now disconnect.

Operator: We look forward to speaking with you again next quarter.

Unknown Executive: This concludes today's conference call. You may now disconnect. So, speaking with you again next quarter.

Speaker Change: This concludes today's conference call you may now disconnect.

Operator: So speaking with you again next quarter.

Q2 2024 The Manitowoc Co Inc Earnings Call

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