The Manitowoc Company Reports Second-Quarter 2017 Financial Results

The Manitowoc Company, Inc. (NYSE: MTW), a leading global manufacturer of cranes and lifting solutions, today reported second-quarter net sales of $394.6 million, diluted EPS on a GAAP basis of breakeven and $0.05 on an adjusted basis.

Second-quarter orders of $379.5 million, which included the initial production order related to the U.S. Army contract, were up 9% from the comparable period in 2016. Backlog totaled $491.2 million at June 30, 2017, up 25%, from the second-quarter 2016 ending backlog of $393.5 million.

Second-quarter 2017 net sales were $394.6 million versus $457.7 million in the comparable period in 2016. The majority of the year-over-year decline was attributable to lower crawler crane shipments in the Americas as the Company shipped a significant volume of these cranes in the prior year, and lower Rough-terrain crane shipments primarily in the Americas and the Middle-East, mainly due to continued weakness in oil and gas market demand.

The Company reported net income from continuing operations of $0.7 million, or $0.00 per diluted share, in the second-quarter 2017 versus a net loss from continuing operations of $(5.0) million, or $(0.04) per diluted share, in the second-quarter 2016. Non-GAAP adjusted net income from continuing operations(1) was $6.5 million, or $0.05 per diluted share, in the second-quarter 2017 versus $3.9 million, or $0.03 per diluted share, in the comparable period of 2016. Non-GAAP adjusted EBITDA(1) for the second-quarter 2017 was $25.2 million compared to $25.3 million in the same period last year.

“We are very pleased with our second-quarter performance as we made considerable progress in consolidating our manufacturing footprint and reducing the cost of our organizational structure. We delivered $0.05 of adjusted EPS and our adjusted EBITDA (1) was flat year-over-year despite a $63 million decline in revenue. Considering our year-to-date performance and future market outlook, we have improved our full year 2017 guidance. This underscores that our team can deliver improved results using the principles of The Manitowoc Way. The relocation of our crawler crane production is complete, on time and under budget,” commented Barry L. Pennypacker, President and Chief Executive Officer of The Manitowoc Company, Inc.

“In the second-quarter we have seen order improvement in most product categories except lattice boom crawler cranes. We have experienced pockets of improved demand in specific markets like the Permian and Eagle Ford basins in North America. European markets continue to experience moderate growth, mainly in residential and non-residential construction markets, partly offset by continued weakness in the Middle-East,” said Pennypacker.

“While we remain cautiously optimistic in the near term, we continue to focus on delivering value through innovative products that provide superior return on invested capital for our customers. In these challenging times, we are maintaining our disciplined adherence to The Manitowoc Way, positioning us to achieve our long-term target of double-digit operating margins by 2020 and becoming the leading global crane company as the market recovers,” concluded Pennypacker.

Full-Year 2017 Guidance

Manitowoc is updating its full year 2017 financial guidance as follows:

• Revenue – down approximately 5-7% year-over-year;
• Adjusted EBITDA – approximately $59 to $69 million;
• Depreciation – approximately $40 million;
• Capital expenditures – approximately $30 million; and
• Income tax expense – approximately $7 to $10 million.

The Company provides guidance on a non-GAAP basis as there is uncertainty in the timing and magnitude of future charges that would be included in the reported GAAP results.

Investor Conference Call

On Tuesday, August 8th, 2017, at 10:00 a.m. ET (9:00 a.m. CT), The Manitowoc Company’s senior management will discuss its second-quarter 2017 earnings results during a live conference call for security analysts and institutional investors. A live audio webcast of the call, along with the related presentation, can be accessed in the Investor Relations section of Manitowoc’s website at www.manitowoc.com. A replay of the conference call will also be available at the same location on the website.

About The Manitowoc Company, Inc.

Founded in 1902, The Manitowoc Company, Inc. is a leading global manufacturer of cranes and lifting solutions with manufacturing, distribution, and service facilities in 20 countries. Manitowoc is recognized as one of the premier innovators and providers of crawler cranes, tower cranes, and mobile cranes for the heavy construction industry, which are complemented by a slate of industry-leading aftermarket product support services. In 2016, Manitowoc’s net sales totaled $1.6 billion, with over half generated outside the United States.

Footnote

(1) Non-GAAP adjusted net income (loss) from continuing operations and non-GAAP adjusted EBITDA (“adjusted EBITDA”) are financial measures that are not in accordance with GAAP. For a reconciliation to the comparable GAAP numbers please see schedule of “Non-GAAP Financial Measures” at the end of this press release. Manitowoc believes these non-GAAP financial measures provide important supplemental information to both management and investors regarding financial and business trends used in assessing its results of operations. Manitowoc believes excluding specified items provides a more meaningful comparison to the corresponding reporting periods and internal budgets and forecasts, assists investors in performing analysis that is consistent with financial models developed by investors and research analysts, provides management with a more relevant measure of operating performance and is more useful in assessing management performance.

Forward-looking Statements

This press release includes "forward-looking statements" intended to qualify for the safe harbor from liability under the Private Securities Litigation Reform Act of 1995. Any statements contained in this press release that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current expectations of the management of the Company and are subject to uncertainty and changes in circumstances. Forward-looking statements include, without limitation, statements typically containing words such as "intends,” "expects," "anticipates," "targets," "estimates," and words of similar import. By their nature, forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results and developments to differ materially include, among others:

• unanticipated changes in revenues, margins, costs, and capital expenditures;
• the ability to significantly improve profitability;
• potential delays or failures to implement specific initiatives within the restructuring program;
• issues relating to the ability to timely and effectively execute on manufacturing strategies, including issues relating to plant closings, new plant start-ups, and/or consolidations of existing facilities and operations, and its ability to achieve the expected benefits from such actions, as well as general efficiencies and capacity utilization of our facilities;
• the ability to direct resources to those areas that will deliver the highest returns;
• uncertainties associated with new product introductions, the successful development and market acceptance of new and innovative products that drive growth;
• the ability to focus on the customer, new technologies, and innovation;
• the ability to focus and capitalize on product quality and reliability;
• the ability to increase operational efficiencies across Manitowoc’s business segment and to capitalize on those efficiencies;
• the ability to capitalize on key strategic opportunities and the ability to implement Manitowoc’s long-term initiatives;
• the ability to generate cash and manage working capital consistent with Manitowoc’s stated goals;
• the ability to convert order and order activity into sales and the timing of those sales;
• pressure of financing leverage;
• foreign currency fluctuations and their impact on reported results and hedges in place with Manitowoc;
• changes in raw material and commodity prices;

• unexpected issues associated with the quality and availability of materials and components sourced from first parties and the resolution of those issues;
• unexpected issues associated with the availability, operations and viability of suppliers;
• the risks associated with growth and contraction;
• geographic factors and political and economic conditions and risks;
• actions of competitors;
• changes in economic or industry conditions generally or in the markets served by Manitowoc;
• unanticipated changes in customer demand, including changes in global demand for high-capacity lifting equipment; changes in demand for lifting equipment in emerging economies, and changes in demand for used lifting equipment;
• global expansion of customers;
• the replacement cycle of technologically obsolete cranes;
• the ability of Manitowoc's customers to receive financing;
• issues related to workforce reductions and subsequent rehiring;
• work stoppages, labor negotiations, labor rates, and temporary labor costs;
• government approval and funding of projects and the effect of government-related issues or developments;
• the ability to complete and appropriately integrate restructurings, consolidations, acquisitions, divestitures, strategic alliances, joint ventures, and other strategic alternatives;
• realization of anticipated earnings enhancements, cost savings, strategic options and other synergies, and the anticipated timing to realize those savings, synergies, and options;
• impairment of goodwill and/or intangible assets;
• unanticipated issues affecting the effective tax rate for the year;
• unanticipated changes in the capital and financial markets;
• risks related to actions of activist shareholders;
• changes in laws throughout the world;
• natural disasters disrupting commerce in one or more regions of the world;
• risks associated with data security and technological systems and protections;
• acts of terrorism; and
• risks and other factors cited in Manitowoc's 2016 Annual Report on Form 10-K and its other filings with the United States Securities and Exchange Commission.

Manitowoc undertakes no obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise. Forward-looking statements only speak as of the date on which they are made. Information on the potential factors that could affect the Company's actual results of operations is included in its filings with the Securities and Exchange Commission, including but not limited to its Annual Report on Form 10-K for the fiscal year ended December 31, 2016.

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