COVID hit construction impacts Manitou results
Manitou Group has released its first quarter results: Q1 revenues for 2020 were €421m, down 25% compared to the same period last year. Order intake on equipment for Q1 2020 was €400m compared to €363m in 2019, the order book on equipment at the end of Q1 2020 at €648 million compared to €884 million in Q1 2019.
Michel Denis, president and chief executive officer, said, “First quarter business was suddenly interrupted by the globalisation of the COVID-19 crisis, which massively affected the construction sector and, to a lesser extent, the industry. Agricultural demands and service activities remain less impacted due to the greater resilience of these sectors. After reorganising working methods and working hours within organisations, the group has focused its efforts on protecting the safety of its employees and sustaining service to its customers.
“The gradual reopening of operations initiated in mid-April will take time before full fluidity and efficiency are restored. It will remain sensitive to the restarting of the entire supply chain. The first feedback to date is encouraging, which is essential for the group to be able to adapt to the seasonality of its markets. The evolution of the health crisis and its economic impacts are still difficult to measure and do not make it possible to estimate the level of activity for the year at this stage. All of the group’s teams are mobilising to support our customers while adapting to new working methods. The year will certainly be very difficult, but I am convinced that the women and men of Manitou will enable the group, thanks to their commitment and responsiveness, to overcome this crisis.”
Business review by division
With sales revenue of €283m for the quarter, the Material Handling & Access (MHA) Division recorded a -29% decrease compared with Q12019. Under the combined effect of the wait-and-see attitude of rentals who had not yet ordered by the end of 2019 and the COVID-19 crisis, the division’s business was down sharply in the quarter. The Compact Equipment Products( CEP) Division posted sales revenues of €64m, a decrease of -24%(-compared with Q1 2019. The beginning of the current fiscal year showed an acceleration in demand, particularly from American rental companies, before this dynamic was stopped by the COVID-19 crisis. The Services & Solutions (S&S) Division recorded a -8% decrease in its revenue compared with Q1 2019 at €74m. The division was able to maintain reduced activity throughout the containment period, enabling it to limit the impact of the COVID-19 crisis.
TheCOVID-19 crisis led the group to shutdown production activities in France, Italy and then India in mid-March, while maintaining, where legislation allowed, the marketing of spare parts and service, as well as the core functions to support its activities. Geographies have been more or less affected by adaptation measures or restrictions on commercial activities. From a business point of view, the strength of the dealer network across all geographies has so far ensured a good resilience of the order book despite the sharp downturn in some markets and geographies. After securing the health and safety of the sites, the French and Italian industrial operations were very gradually reactivated in mid-April. The implementation of new measures and the restarting of the supply chain should impact industrial performance for many months to come.