Manitowoc Lowers 2016 Sales, Operating Margin Guidance; Shares Plunge

(RTTNews) - The Manitowoc Company, Inc. (MTW) announced, for the full-year 2016, the company expects: revenue to be down approximately 10% to 12%; and adjusted operating income margins in the range of approximately 1% to 2%. In May, the company projected: revenue to be approximately flat; and operating margins of approximately 4%.

"As we approach the back half of the year, we expect to see market challenges continue and a similar dynamic in sales with continued strength in Tower cranes more than offset by continued weakness in Mobile cranes. In spite of the positive energy we experienced at bauma this year, it is clear that our customers remain cautious around spending given the ongoing global macro-economic uncertainty. As a result, we have lowered our full-year 2016 sales and operating margin guidance," said, Barry Pennypacker, CEO of Manitowoc Company, Inc.

The Manitowoc Company reported second-quarter 2016 sales of $457.7 million, a four percent decrease versus $477.7 million in the comparable period in 2015. "During the second quarter, our sales were further impacted by a challenging market environment on a number of levels, particularly in Mobile cranes in the Americas. This weakness was in part offset by strength in Tower cranes." said Barry Pennypacker.

Operating margin was 3.2 percent for the second quarter of 2016, consistent with 3.2 percent for the second quarter of 2015. The company said its operating margins were positively impacted by structural reductions in force and other operating efficiencies.

The Manitowoc Company, Inc. also announced its intent to relocate its crawler crane manufacturing operations from Manitowoc, Wisconsin to Shady Grove, Pennsylvania, to optimize its manufacturing footprint, reduce costs and expand margins. The company expects to recognize non-cash charges of approximately $105-120 million. In total, the initiative is expected to generate annualized pre-tax cost savings of $25-30 million. The Manitowoc Company, Inc. will maintain its headquarters in Manitowoc, Wisconsin.

Shares of The Manitowoc Company were down more than 12% after hours.