Terex Reports Second Quarter Results

Terex Corporation (NYSE: TEX) today announced net incomefor the second quarter of 2005 of $78.8 million, or $1.54 per share,compared to net income of $59.1 million, or $1.17 per share, for thesecond quarter of 2004. Excluding the impact of special items for thesecond quarter of 2005, net income was $80.5 million, or $1.58 pershare, compared to net income of $52.3 million, or $1.03 per share,for the second quarter of 2004. Special items for the second quarterof 2005 included charges for investigation costs associated with theCompany's internal review and restatement of its financial statementsfor the fiscal years 2000, 2001, 2002, and 2003, and charges relatingto general corporate restructuring. Special items for the secondquarter of 2004 primarily included gains on the sale of real estateand the favorable settlement of litigation proceedings related to theCompany's acquisition of the O&K mining business, partially offset bycosts related to the restructuring of Terex-Atlas facilities in the UKand Germany, loss on the sale of certain discontinued service partsbusinesses, a write-down of a joint venture investment and acceleratedamortization arising from the early retirement of debt. As discussedin the "Capital Structure and Taxes" section of this release, for theperiod ended June 30, 2005, the Company is using an estimated tax rateof 33.8%, versus the 19.7% rate used for the second quarter of 2004.

Net sales increased to $1,763.8 million in the second quarter of2005, an increase of 32% from $1,336.4 million in the second quarterof 2004. Net debt (consisting of long-term debt, including currentportion of long-term debt, less cash and cash equivalents) at June 30,2005 decreased by $139 million from March 31, 2005 levels.

For the six months ended June 30, 2005, net sales totaled $3,213.0million, an increase of 35% from $2,380.2 million for the six monthsended June 30, 2004. Net income for the first six months of 2005 was$108.7 million, or $2.13 per share, compared to net income of $76.1million, or $1.50 per share, for the first six months of 2004. Netincome, excluding special items, was $111.1 million, or $2.17 pershare, for the first six months of 2005, compared to net income,excluding special items, of $69.3 million, or $1.37 per share, for thefirst six months of 2004. Net debt decreased by $47 million in the sixmonths ended June 30, 2005.

"Terex continues to gain momentum, both in the marketplace andfrom our internal initiatives," said Ronald M. DeFeo, Terex's Chairmanand Chief Executive Officer. "Our incremental margin (defined as theyear over year change in income from operations divided by the yearover year change in net sales) in the quarter was 13%, well above the6% we achieved in the first quarter of 2005. We have a commitment tofulfilling customer demand and growing our products' presence in themarketplace while improving operating margin through price realizationand enhanced manufacturing efficiencies. We are pleased with the over50% increase in net income and EPS for the second quarter versus lastyear, excluding special items."

Mr. DeFeo added, "I remain optimistic about our prospects for thisyear and beyond, and feel that our progress on all fronts,particularly in profitability, capital structure, and the TerexBusiness System implementation, are delivering disproportionatelyhigher returns on invested capital ("ROIC") versus our peer group.This will provide meaningful returns to our stakeholders. Many of ourbusinesses contributed to this strong second quarter earningsperformance, but we still have operational opportunities to improve. Anumber of our end-markets have yet to meaningfully contribute to ouroverall profitability. As such, we view this quarter as a good stepalong the path to our previously stated longer term objectives."

Mr. DeFeo continued, "Additionally, during the second quarter of2005, we reduced our net debt by $139 million. This results fromcontinuing efforts to improve our effective use of working capital(the sum of accounts receivable and inventory less accounts payable),as well as improving profitability and our corporate focus ongenerating strong incremental ROIC. We expect to pay down debt in theshort term, continue to strengthen our capital structure and positionthe Company to retire our expensive bonds in 2006 with cash, which hasbeen another of our previously stated goals."

"We continue to make progress on our financial restatementprocess," added Mr. DeFeo. "While I am not able to provide closure tothe process at this point, I believe I can state that resolution ofthis matter is a short time away. We again would like to stress that,although this has been a prolonged process, the expected impact on ourstockholders' equity at December 2003 will not be material."

In this press release Terex refers to various non-GAAP (generallyaccepted accounting principles) financial measures. These measures maynot be comparable to similarly titled measures being disclosed byother companies. The tables below provide a reconciliation of thereported GAAP numbers for the second quarters and first six months of2005 and 2004 and the reported numbers excluding special items. Terexbelieves that this information is useful to understanding itsoperating results and the ongoing performance of its underlyingbusinesses without the impact of special items. Terex also disclosesEBITDA and net debt, as they are commonly referred to financialmetrics used in the investing community. Terex believes thatdisclosure of EBITDA and net debt will be helpful to those reviewingits performance and that of other comparable companies, as EBITDA andnet debt provide information on Terex's leverage position, ability tomeet debt service and capital expenditure and working capitalrequirements, and EBITDA is also an indicator of profitability.

While the Company has not yet completed its audited financialstatements for 2004, it currently does not anticipate that thefinancial results for the period ended June 30, 2004 included in thisrelease will be restated.

A financial summary is shown below:
Three months ended June 30,
--------------------------------------------------------
2005 2004
--------------------------- ----------------------------
(in millions, except per share amounts)

Excluding Excluding
Special Special Special Special
Reported Items(2) Items Reported Items(3) Items
--------------------------- ---------------------------
Net Sales $1,763.8 $ --- $ 1,763.8 $1,336.4 $ --- $ 1,336.4
======== ======== ========= ======== ======== =========
Gross profit $ 283.9 $ 1.1 $ 285.0 $ 195.0 $ 9.9 $ 204.9
SG&A 141.8 (1.4) 140.4 119.2 (1.6) 117.6
-------- -------- --------- -------- -------- ---------
Income from
Operations 142.1 2.5 144.6 75.8 11.5 87.3
Other income
(expense) (23.1) --- (23.1) (2.2) (19.9) (22.1)
Provision for
income taxes (40.2) (0.8) (41.0) (14.5) 1.6 (12.9)
-------- -------- --------- -------- -------- ---------
Net income $ 78.8 $ 1.7 $ 80.5 $ 59.1 $ (6.8)$ 52.3
======== ======== ========= ======== ======== =========
Earnings per
share $ 1.54 $ 1.58 $ 1.17 $ 1.03
EBITDA (1) $ 157.8 $ 160.3 $ 94.9 $ 104.8
Backlog $1,370.6 $ 2.5 $ 1,370.6 $ 916.2 $ 9.9 $ 916.2

Average Fully
Diluted
Shares
Outstanding 51.1 51.1 50.7 50.7

(1) EBITDA is calculated as income from operations plus depreciation
and amortization included in income from operations.
(2) Special items, net of tax, relate to charges for investigation
costs associated with the Company's internal review ($0.3
million), and charges related to restructuring activities, namely
at the corporate level, and at the business units of Cedarapids
and Terex UK ($1.4 million).
(3) Special items, net of tax, relate to the gain on the sale of
facilities ($13.3 million), costs associated with restructuring
activities, mainly in the Terex-Atlas businesses ($6.1 million),
the net gain related to the favorable settlement of litigation
proceedings regarding the O&K acquisition ($3.4 million), the loss
on the sale of discontinued service parts business activities
($1.8 million), the write-down of investments ($0.8 million), and
the accelerated amortization arising from the early retirement of
debt ($1.2 million).


Six months ended June 30,
---------------------------------------------------------
2005 2004
---------------------------- ----------------------------
(in millions, except per share amounts)

Excluding Excluding
Special Special Special Special
Reported Items(2) Items Reported Items(3) Items
--------------------------- ---------------------------
Net Sales $3,213.0 $ --- $ 3,213.0 $2,380.2 $ - $ 2,380.2
======== ======== ========= ======== ======== =========
Gross profit $ 490.6 $ 1.2 $ 491.8 $ 355.3 $ 9.9 $ 365.2
SG&A 278.2 (2.1) 276.1 231.2 (1.6) 229.6
-------- -------- --------- -------- -------- ---------
Income from
Operations 212.4 3.3 215.7 124.1 11.5 135.6
Other income
(expense) (47.5) --- (47.5) (26.1) (19.9) (46.0)
Provision
for income
taxes (56.2) (1.1) (57.1) (21.9) 1.6 (20.3)
-------- -------- --------- -------- -------- ---------
Net income $ 108.7 $ 2.2 $ 111.1 $ 76.1 $ (6.8)$ 69.3
======== ======== ========= ======== ======== =========
Earnings per
share $ 2.13 $ 2.17 $ 1.50 $ 1.37
EBITDA (1) $ 243.5 $ 246.8 $ 160.1 $ 170.0
Backlog $1,370.6 $ 3.3 $ 1,370.6 $ 916.2 $ 9.9 $ 916.2

Average
Fully
Diluted
Shares
Outstanding 51.1 51.1 50.6 50.6

(1) EBITDA is calculated as income from operations plus depreciation
and amortization included in income from operations.
(2) Special items, net of tax, relate to charges for investigation
costs associated with the Company's internal review ($0.7
million), charges related to restructuring activities, namely at
the corporate level, and at the business units of Cedarapids and
Terex UK ($1.4 million), and charges relating to the closure of
certain Terex Utilities branch locations $(0.1 million).
(3) Special items, net of tax, relate to the gain on the sale of
facilities ($13.3 million), costs associated with restructuring
activities, mainly in the Terex-Atlas businesses ($6.1 million),
the net gain related to the favorable settlement of litigation
proceedings regarding the O&K acquisition ($3.4 million), the loss
on the sale of discontinued service parts business activities
($1.8 million), the write-down of investments ($0.8 million), and
the accelerated amortization arising from the early retirement of
debt ($1.2 million).

Segment Performance

As previously announced, starting with the third quarter of 2004,Terex has realigned certain operations in an effort to strengthen itsability to service customers and to recognize certain organizationalefficiencies. The Materials Processing Group, formerly part of theTerex Roadbuilding, Utility Products and Other Segment, is nowconsolidated with the Terex Mining Group under the Terex MaterialsProcessing & Mining Segment. The Terex Light Construction and LoadKing businesses, formerly part of the Terex Roadbuilding, UtilityProducts and Other Segment, are now part of the Terex Aerial WorkPlatforms Segment.

The comparative segment performance data below reflects thiscurrent organization, and prior period amounts have been reclassifiedto conform to this presentation. Comparative segment performance dataalso excludes special items.
Terex Construction

Second Quarter Year-to-Date
--------------------------- -----------------------------
(dollars in millions)
2005 2004 2005 2004
------------- ------------- --------------- -------------
% of % of % of % of
Sales Sales Sales Sales
----- ----- ----- -----
Net sales $604.5 $475.0 $1,073.0 $864.7
======= ======= ========= =======
Gross profit $ 90.8 15.0% $ 71.0 15.0% $ 148.9 13.9% $123.4 14.3%
SG&A 42.5 7.0% 39.5 8.3% 84.5 7.9% 75.7 8.8%
------- ------- --------- -------
Operating
profit $ 48.3 8.0% $ 31.5 6.6% $ 64.4 6.0% $ 47.7 5.5%
======= ======= ========= =======
Backlog $232.3 $216.5 $ 232.3 $216.5

Net sales in the Terex Construction group for the second quarterof 2005 increased $129.5 million to $604.5 million from $475.0 millionin the second quarter of 2004. The 27% increase in net sales wasprimarily driven by the heavy construction equipment businesses,including the scrap handler business, and the mobile crushing andscreening businesses. Gross margin in the second quarter of 2005 was15.0%, flat compared with the second quarter of 2004. SG&A expensesfor the second quarter of 2005 were $42.5 million, or 7.0% of sales,compared to $39.5 million, or 8.3% of sales, in the second quarter of2004, with the increase being mainly due to higher sales and marketingcosts related to increased sales volume. Income from operations forthe quarter was $48.3 million, or 8.0% of sales, an increase of 53%when compared to $31.5 million, or 6.6% of sales, for the secondquarter of 2004.

"The second quarter overall performance was quite positive. Whileour businesses continue to be negatively impacted by the relativelyweak U.S. Dollar and steel cost pressures, both situations appear tobe improving," commented Colin Robertson, President - TerexConstruction. "The positive impact of pricing actions taken earlier inthe year has helped mitigate cost pressures, and we expect this trendto continue as the new pricing levels flow through our backlog. Thispricing action impact is evident by comparing our gross margin in thesecond quarter of 15.0% with the 12.4% delivered in the first quarterof this year and with the incremental operating margin in the secondquarter of approximately 13%."

Mr. Robertson continued, "The crushing and screening businessescontinued to be the most affected by increased steel pricing, andalthough operating margin was down slightly, their operating profitwas up over 15% on an absolute dollar basis. Our heavy constructionbusiness continues to show improvements, with the group postingrevenue gains of over 35%."
Terex Cranes

Second Quarter Year-to-Date
--------------------------- ---------------------------
(dollars in millions)
2005 2004 2005 2004
------------- ------------- ------------- -------------
% of % of % of % of
Sales Sales Sales Sales
----- ----- ----- -----
Net sales $341.5 $276.9 $641.0 $486.1
======= ======= ======= =======
Gross profit $ 44.8 13.1% $ 34.2 12.4% $ 76.9 12.0% $ 64.0 13.2%
SG&A 29.1 8.5% 21.9 7.9% 54.9 8.6% 45.3 9.3%
------- ------- ------- -------
Operating
profit $ 15.7 4.6% $ 12.3 4.4% $ 22.0 3.4% $ 18.7 3.8%
======= ======= ======= =======
Backlog $314.7 $285.4 $314.7 $285.4

Net sales in the Terex Cranes group for the second quarter of 2005increased $64.6 million to $341.5 million from $276.9 million in thesecond quarter of 2004, reflecting improvement in all businesses,particularly in the tower crane business. SG&A expenses increased inthe second quarter of 2005 to $29.1 million, or 8.5% of sales,compared to SG&A expenses in the second quarter of 2004 of $21.9million, or 7.9% of sales, mainly due to increased sales and marketingcosts related to increased sales volume, an increase in the Company'sbad debt provision, as well an increase in an employee profit sharingprogram. Income from operations increased $3.4 million to $15.7million, or 4.6% of sales, for the second quarter of 2005 from $12.3million, or 4.4% of sales, for the second quarter of 2004.

"The Terex Cranes group continued its improvement over last year'sperformance," commented Steve Filipov, President - Terex Cranes. "Asin the first quarter of 2005, our business experienced an increase insales due to generally improving market conditions. Our Italian,French, American, and Australian operations all posted substantiallyincreased net sales when compared with their 2004 results. In NorthAmerica, the growth was mainly attributed to recovering rough terrainand boom truck crane markets. Also positively impacting our businesswere the price increases we put in place late in 2004, which wereintended to recover margin erosion over the past twelve months due toincreased input costs."

Mr. Filipov continued, "As has been the case for the past fewyears, much of the North American business struggled to meet ourprofitability expectations. We are actively pursuing sourcinginitiatives to reduce the cost of components, with Terex's Acuna,Mexico facility playing a vital role in this effort. Additionally,since March 2005, we have increased our direct workforce at ourWaverly, Iowa location by over 40%, and as of June 27, 2005, we havestarted production at Waverly on a second shift. These actions shouldallow us to better absorb our overhead costs, begin to deliver some ofour higher priced backlog, and position our business for theanticipated marketplace recovery."
Terex Aerial Work Platforms


Second Quarter Year-to-Date
--------------------------- ---------------------------
(dollars in millions)
2005 2004 2005 2004
------------- ------------- ------------- -------------
% of % of % of % of
Sales Sales Sales Sales
----- ----- ----- -----
Net sales $376.3 $257.0 $671.4 $442.0
======= ======= ======= =======
Gross profit $ 70.6 18.8% $ 52.5 20.4% $121.6 18.1% $ 92.3 20.9%
SG&A 21.8 5.8% 18.1 7.0% 45.1 6.7% 36.1 8.2%
------- ------- ------- -------
Operating
profit $ 48.8 13.0% $ 34.4 13.4% $ 76.5 11.4% $ 56.2 12.7%
======= ======= ======= =======
Backlog $420.5 $120.3 $420.5 $120.3

Net sales for the Terex Aerial Work Platforms group for the secondquarter of 2005 increased $119.3 million to $376.3 million from $257.0million in the second quarter of 2004. The increase in sales wasdriven primarily by continued strong order activity in the rentalchannel. Gross margin was negatively impacted by continued costpressures on components used in production. However, pricing actionshave begun to contribute to overall profitability, with income fromoperations increasing to $48.8 million, or 13.0% of sales, in thesecond quarter of 2005 from $34.4 million, or 13.4% of sales, in thesecond quarter of 2004.

"We continue to operate in an extremely positive environment forAWP and related products," said Bob Wilkerson, President-Terex AerialWork Platforms. "Our second quarter sales were up just under 50%, andour backlog is up 250% when compared to the second quarter of 2004.Our telehandler business posted year over year revenue increases inexcess of 75%, as we have continued to penetrate key accounts withthis product, as well as adjusted our production to take advantage ofthis growing product category."

Mr. Wilkerson continued, "This quarter reflects a continuation ofthe trends we have seen over the past year. Cost pressures, namelysteel, are easing somewhat, but they still weigh on our business whencompared to the prior year. We improved our operating margin to 13.0%versus the 9.4% delivered in the first quarter of 2005, a full pointbetter than we had targeted in our first quarter earnings release. Forproduct ordered now and shipped after January 1, 2006, we have begunto introduce a new, greatly simplified pricing structure designed toensure more consistent pricing across our product lines. In addition,this new structure better reflects the value this segment's productsdeliver and makes it easier for customers to do business with Terex."
Terex Materials Processing & Mining


Second Quarter Year-to-Date
--------------------------- ---------------------------
(dollars in millions)
2005 2004 2005 2004
------------- ------------- ------------- -------------
% of % of % of % of
Sales Sales Sales Sales
----- ----- ----- -----
Net sales $222.3 $133.0 $418.8 $229.3
======= ======= ======= =======
Gross profit $ 40.9 18.4% $ 23.5 17.7% $ 73.3 17.5% $ 38.8 16.9%
SG&A 20.9 9.4% 13.9 10.5% 40.9 9.8% 26.2 11.4%
------- ------- ------- -------
Operating
profit $ 20.0 9.0% $ 9.6 7.2% $ 32.4 7.7% $ 12.6 5.5%
======= ======= ======= =======
Backlog $235.6 $156.4 $235.6 $156.4

Net sales for the Terex Materials Processing & Mining group forthe second quarter of 2005 increased $89.3 million to $222.3 millionfrom $133.0 million in the second quarter of 2004. As in the firstquarter of 2005, the increase in sales is attributable to the overallstrong demand for mining products, mainly the mining hydraulicexcavators manufactured in Dortmund, Germany, as well as to theacquisition of the Reedrill mining business in the fourth quarter of2004. Excluding the acquisition of Reedrill, net sales increased 43%compared to the comparable year ago period. This increased salesvolume had a positive impact on operating income, as income fromoperations increased to $20.0 million, or 9.0% of sales, in the secondquarter of 2005 from $9.6 million, or 7.2% of sales, in the secondquarter of 2004.

"The Materials Processing & Mining group continues to see thebenefits from a rapidly improving end-market, mainly attributable tothe commodity demand for coal and steel," commented Rick Nichols,President - Terex Materials Processing & Mining. "The demand forTerex's hydraulic shovel and electric drive mining trucks continue todrive our revenue growth. Additionally, the increasing population ofour fleet has significantly improved our parts and service sales,which posted a year over year increase in excess of 45%. We continueto feel that the mining cycle is stable at a level where we shouldcontinue to see solid demand for our machines and parts, and expectthis positive cycle to continue for a few years. In addition to ourcore mining products, our Reedrill business provided another excellentquarter of performance, and our North American Materials Processingbusiness continues its favorable trends, with net sales improvingapproximately 19% and operating profits increasing by 57% versus theyear ago period."
Terex Roadbuilding, Utility Products and Other

Second Quarter Year-to-Date
--------------------------- ---------------------------
(dollars in millions)
2005 2004 2005 2004
------------- ------------- ------------- -------------
% of % of % of % of
Sales Sales Sales Sales
----- ----- ----- -----
Net sales $252.9 $215.1 $470.9 $389.2
======= ======= ======= =======
Gross profit $ 33.7 13.3% $ 24.0 11.2% $ 67.9 14.4% $ 46.9 12.1%
SG&A 23.0 9.1% 21.3 9.9% 46.1 9.8% 40.9 10.5%
------- ------- ------- -------
Operating
profit $ 10.7 4.2% $ 2.7 1.3% $ 21.8 4.6% $ 6.0 1.5%
======= ======= ======= =======
Backlog $190.4 $147.8 $190.4 $147.8

Net sales for the Terex Roadbuilding, Utility Products and Othergroup for the second quarter of 2005 increased $37.8 million to $252.9million from $215.1 million for the second quarter of 2004, withsubstantially all the sales growth coming from the concrete mixingtruck and Tatra businesses. SG&A expenses for the second quarter of2005 were $23.0 million, or 9.1% of sales, compared to $21.3 million,or 9.9% of sales, in the second quarter of 2004. Income fromoperations increased to $10.7 million, or 4.2% of sales, from $2.7million, or 1.3% of sales, in the second quarter of 2004. Theimprovement in profitability is primarily attributed to theroadbuilding business, as improvement initiatives taken over the pastfew years began to positively impact financial performance.

"The Roadbuilding, Utility Products and Other group had anotherpositive quarter," commented Mr. DeFeo. "The improvement in theperformance of these businesses is, however, more the result of aninternal focus on production and distribution issues than any dramaticmove in the end market condition. This is most evident in our TerexRoadbuilding group, who had revenue improvement of just over 4%, butaccounted for substantially all of the improvement in profitability.The Terex Utilities team, much as the roadbuilding business did overthe past few years, continues to focus on Terex Business Systemimplementation and extracting incremental value out of itsdistribution network. This should evolve over the next twelve monthsand provide substantial upside to the financial profile of this groupof businesses."

Mr. DeFeo continued, "Specifically, strong results this quarterwere realized in our concrete focused businesses, such as the concretemixing truck, concrete paver and batch plant businesses. The asphaltbusiness is showing modest improvements, although the asphalt plantbusiness remains a challenging market, as buyers were waiting for therecent passage of a new long term federal highway bill. The utilitybusiness has seen some pickup in order activity coming off almost fouryears of anemic activity. With a slowly improving telecommunicationsand utility customer base, we expect this business to improvesubstantially in 2006. Lastly, the military and special truck programincurred a slight loss in the quarter, mainly impacted by the costsrelating to the LVSR U.S. Marine Corp truck bid."

Capital Structure and Taxes

"Net debt at the end of the second quarter of 2005 decreased $139million to $733 million, from $872 million at the end of the firstquarter of 2005, as the Company continued to concentrate on its levelof working capital investment," commented Phil Widman, Senior VicePresident and Chief Financial Officer. "As stated in the firstquarter, we expected our cash flow to closely reflect the seasonaltrends of our business. We are pleased with the position of ourbalance sheet at this time of year, as we are ahead of where weplanned to be going into 2005. We continue to target 18% workingcapital as a percentage of trailing three months annualized sales forthe end of 2005, and 15% for the end of 2006. Working capital as apercent of trailing three month annualized sales was approximately 17%at the end of the second quarter of 2005, as compared to approximately18% at the end of the second quarter in 2004."

Commenting on the effective tax rate used in this release, Mr.Widman stated, "The effective tax rate for the second quarter of 2005is estimated to be 33.8%, compared to 19.7% in the second quarter of2004. The 2004 rate was lower due to the strong financial performanceof the Fermec business, where it was determined that the Company wouldbe able to realize the benefits of certain tax assets, and therefore,the valuation allowance held for this business was released. While thefull year 2005 effective tax rate is expected to be approximately 35%,the rate can fluctuate quarter to quarter as a result of changesduring the period in the assumptions related to valuation allowances,the mix of income by jurisdiction, and other discrete items."

Outlook

"We remain enthusiastic about the full year business prospects forthe Company," commented Mr. DeFeo. "We continue to see strong orderactivity, as evidenced by both our year to date revenue increase of35% and the increase in our order backlog of 50% when compared to thesame point last year. Return on invested capital (calculated as thetrailing four quarters operating income divided by the sum of thetrailing four quarters average shareholders' equity and the trailingfour quarter average net debt) was approximately 17% at the end of thesecond quarter, demonstrating continued improvement towards our goalfor ROIC of 20% or greater at the end of 2005."

"We are optimistic about the near term performance of just aboutevery business group, though certain product categories, such as TerexRoadbuilding, Terex Utilities and Terex Cranes North America, stilloperate in challenging, but improving end-market conditions," Mr.DeFeo continued. "Our general view is for the conditions in ourvarious end-markets to continue their upward trajectory, with theselagging segments to begin to meaningfully contribute in 2006."

"In our previous outlook, we expected earnings per share ("EPS")for 2005 to be in the range of $3.50 to $3.70 per share, excludingspecial items. Based on the current trend, we expect improvedperformance to result in EPS of between $3.90 and $4.10 for 2005,excluding special items."

Financial Restatement Update

As previously announced, Terex has not yet finalized its thirdquarter 2004, full year 2004 and first and second quarter 2005 resultspending completion of its detailed internal accounting review, therestatement of Terex's financial statements for the years endedDecember 31, 2000, 2001, 2002 and 2003, and the completion of itsaudited financial statements for 2004. Terex continues to workdiligently to complete its restatement, audit and assessment ofinternal control over financial reporting. Terex believes that it isnearing completion of this process, and currently anticipates filingall appropriate documents, including applicable financial statements,with the SEC in the near future. While no assurance can be made, it ismanagement's current expectation that the financial statements for theyear ended December 31, 2004 and prior periods will be filed on orbefore August 15, 2005.

Safe Harbor Statement

The press release contains forward-looking information based onTerex's current expectations. Because forward-looking statementsinvolve risks and uncertainties, actual results could differmaterially. Such risks and uncertainties, many of which are beyondTerex's control, include among others: Terex's business is highlycyclical and weak general economic conditions may affect the sales ofits products and its financial results; the sensitivity ofconstruction, infrastructure and mining activity and products producedfor the military to interest rates and government spending; theability to successfully integrate acquired businesses; the retentionof key management personnel; Terex's businesses are very competitiveand may be affected by pricing, product initiatives and other actionstaken by competitors; the effects of changes in laws and regulations;Terex's business is international in nature and is subject to changesin exchange rates between currencies, as well as internationalpolitics; Terex's continued access to capital and ability to obtainparts and components from suppliers on a timely basis at competitiveprices; the financial condition of suppliers and customers, and theircontinued access to capital; Terex's ability to timely manufacture anddeliver products to customers; Terex's significant amount of debt andits need to comply with restrictive covenants contained in Terex'sdebt agreements; Terex's ability to file its periodic reports with theSEC on a timely basis; Terex's ability to ensure that all intercompanytransactions will be properly recorded; compliance with applicableenvironmental laws and regulations; and other factors, risks,uncertainties more specifically set forth in Terex's public filingswith the SEC. In addition, until the previously announced review byTerex of its accounts is concluded, no assurance can be given withrespect to the financial statement adjustments, impacts and periodsresulting from such review, nor can there be assurance that additionaladjustments to the financial statements will not be identified. Actualevents or the actual future results of Terex may differ materiallyfrom any forward looking statement due to those and other risks,uncertainties and significant factors. The forward-looking statementsspeak only as of the date of this release. Terex expressly disclaimsany obligation or undertaking to release publicly any updates orrevisions to any forward-looking statement included in this release toreflect any changes in Terex's expectations with regard thereto or anychanges in events, conditions, or circumstances on which any suchstatement is based.

Terex Corporation is a diversified global manufacturer with 2004net sales of approximately $5 billion. Terex operates in five businesssegments: Terex Construction, Terex Cranes, Terex Aerial WorkPlatforms, Terex Materials Processing & Mining, and TerexRoadbuilding, Utility Products and Other. Terex manufactures a broadrange of equipment for use in various industries, including theconstruction, infrastructure, quarrying, recycling, surface mining,shipping, transportation, refining, utility and maintenanceindustries. Terex offers a complete line of financial products andservices to assist in the acquisition of Terex equipment through TerexFinancial Services. More information on Terex can be found atwww.terex.com.