In This Article:
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Revenue: $1.2 billion, a 4.9% decrease from the prior year.
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Earnings Per Share (EPS): $0.83.
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Operating Margin: 9.1%, a decrease of 350 basis points from the prior year.
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Return on Invested Capital: 15%.
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Backlog: $2.6 billion, up 13% sequentially.
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Book-to-Bill Ratio: 124%.
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Environmental Solutions Operating Margin: 19.4%.
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Interest and Other Expenses: $41 million, $26 million higher than last year.
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Effective Tax Rate: 21%.
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Free Cash Flow: Improved compared to Q1 last year.
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Liquidity: $1.1 billion.
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Share Repurchase: $32 million in Q1.
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Dividends Paid: $11 million in Q1.
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Full Year EPS Outlook: $4.70 to $5.20.
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Full Year Sales Outlook: $5.3 billion to $5.5 billion.
Release Date: May 02, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Terex Corp (NYSE:TEX) exceeded its initial Q1 financial outlook, delivering earnings per share of $0.83 on sales of $1.2 billion.
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The Environmental Solutions segment achieved a strong operating margin of 19.4%, contributing significantly to the company's overall performance.
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The company maintained a strong backlog of $2.6 billion, up 13% sequentially, indicating robust demand.
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Terex Corp (NYSE:TEX) is leveraging its US-centric manufacturing footprint, with approximately 75% of its 2025 US machine sales expected to be generated by products made in the US.
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The company is on track to deliver more than $25 million in operational run rate synergies by the end of 2026, driven by the integration of ESG.
Negative Points
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Terex Corp (NYSE:TEX) experienced a 4.9% decline in total net sales compared to the prior year, with organic sales declining by 25% year-over-year.
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Operating margins were impacted by production cuts in the Aerials and MP segments, resulting in a 350 basis point decline compared to the prior year.
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The company faces challenges from tariffs, with an assumed $0.40 net tariff impact included in the full-year outlook.
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The European market remains weak, posing a headwind for the Materials Processing segment.
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Interest and other expenses increased by $26 million year-over-year due to interest on ESG reposition financing.
Q & A Highlights
Q: I was really impressed by the ES margin improvement in the quarter. Can you expand on the margin outlook for the coming quarters? A: Jennifer Kong-Picarello, Senior VP & CFO: The strong Q1 ES performance was driven by a 6% sequential increase in sales, record Q1 throughput, and integration synergies. We expect margins to moderate back to normalized rates due to upcoming expenses for ramping up production and supporting expansion.