Manitowoc Company, Inc. (The)

Good day and welcome to the Manitowoc fourth quarter and full year 2024 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then 1 on your touchtone phone. To withdraw your question, please press star, and then 2. Please note this event is being recorded. I would now like to turn the conference over to Ion Warner, Senior Vice President of Marketing and Investor Relations. Please go ahead.

Good morning, everyone, and welcome to our earnings call to review the company's fourth quarter and full year 2024 financial performance and business update as outlined in last evening's press release. Joining me this morning with prepared remarks are Aaron Ravenscroft, our President-in-Chief Executive Officer, and Brian Regan, Executive Vice President and Chief Financial Officer. Earlier this morning, we posted our slide presentation on the investor relations section on our website, manitowoc.com, which you can use to follow along with our prepared remarks. Please turn to slide two. Before we start, please note our safe harbor statement in the material provided for this call. During today's call, Forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995 are made based on the company's current assessment of its markets and other factors that affect its business. However, actual results could differ materially from any implied or actual projections due to one or more of the factors, among others, described in the company's latest SEC filings. The Manitowoc Company does not undertake any obligation to update or revise any forward-looking statement whether the result of new information, future events, or other circumstances. And with that, I'll now turn the call over to Aaron.

Thank you, Ion, and good morning, everyone. Please turn to slide three. In the wise words of Winston Churchill, a pessimist sees the difficulty in every opportunity. An optimist sees the opportunity in every difficulty. As you can draw from our financial results, we faced plenty of difficulties during 2024. I'm proud to say that the Manitowoc team pursued every potential opportunity with great enthusiasm and optimism. It's inspiring to see the level of motivation and passion throughout the company. For example, during the year, we set a new record with $629 million in non-new machine sales. We grew our field service technician count by 7% to over 460 team members. We launched 13 new cranes, including the next generation EV self-erecting tower crane and the MCT 2205, which is the largest tower crane that we've designed and built out of our China operations. And we renegotiated our debt to improve our liquidity and extend our tenor. I'd like to express my sincerest gratitude to the Manitowoc team for a hard-fought 2024. For the full year, we reported $2.2 billion in sales and $128 million in adjusted EBITDA. We generated $100 million of free cash flow during the fourth quarter and ended the year with $321 million in liquidity. Please turn to slide four. Turning our focus to the Manitowoc Way, I am extremely proud of the team's achievements. First and foremost, in terms of safety, we ended the year with an RIR or recordable incident rate of 1.19. This is the second best result in the company's history following a phenomenal year in 2023. In addition, we reduced our first aid incidents 25% year over year and saw a significant reduction in the severity of our lost time injuries. 2024 was arguably the safest year in our 120 year history. Nevertheless, our goal still remains zero injuries, and the team continues to find ways to improve. We also continue to forge ahead with our environmental-related Kaizens. In addition to the benefits to the planet, these initiatives have been pretty darn good for our pocketbook. During the year, we reduced our greenhouse gas intensity 6%, which equates to roughly $100,000 in savings. Since 2019, when we set our baseline for this metric, we've reduced our intensity by 36%. Lastly, I'd like to recognize our maintenance team in Portugal, who won our annual Manitowoc Way Lesson Learn Award. Thanks to their ingenuity, the team built an automated tester for welding torches that only cost 50 euros. Previously, we fixed upon failure, which could cause serious quality problems and significant loss of time. In addition to this invention, over the past two years, the team has done an excellent job integrating different IoT tools to track TPMs on our machining centers, modifying our paint booths to reduce our emissions and gas consumption, and applying 5S to our maintenance area of the plant. Obrigado to the team and congratulations. Please move to slide five. Turning our attention to the market, we generated orders of $516 million during the fourth quarter. Our backlog ended the year at $650 million. Regionally, the Americas rebounded in the fourth quarter following the U.S. election. Customer sentiment has significantly improved post-election. Dealer inventory levels remain reasonable. Utilization rates at crane operators have been strong, and rental rates have held steady. There's optimism about the future demand. In Europe, the situation remains complicated, but there are a few positive indicators that suggest the European tower crane market is gradually recovering. For the second quarter in a row, our orders for tower cranes grew modestly year over year. While the French market remains weak, this has been offset by growth in Germany, Italy, and the UK. In Italy, a new incentive plan called Transione 5.0 has recently announced. And of course, we are keen to see the impact of the upcoming German elections. Regarding France, I visited our two largest dealers and four major construction companies in December. Overall sentiment has yet to improve. All said, uncertainty still exists, but I am hopeful that there is some recovery in 2025. For EU mobiles, in spite of the difficult economic environment in the region, demand for all-terrain cranes has been relatively stable. We continue to benefit from recent product introductions and our significant improvements in quality and service. As a reminder, the Munich-Bama event is just around the corner. We're excited to showcase our new products as well as a variety of our new aftermarket offerings. The show is always a good barometer for how Europe will shape up over the next couple of years. If you plan to attend the show, we'd be happy to host you. Turning to the Middle East, the overall market remains robust. Fourth quarter orders were up over 44% year over year. I visited the region in December, and the situation remains the same in Saudi. While funding is tightening, numerous projects in the kingdom need to be completed to host the 2029 Asian Winter Games, the World Expo in 2030, and the World Cup in 2034. To put this into perspective, a total of 780,000 hotel rooms will be needed for the World Cup alone. Three stadium projects have been awarded with another seven due to be granted. As for Neom, one of these stadiums will be integrated into the line. Although it may take some time before the 170-kilometer vision for the line is completed, the airport project is already underway and the initial modules are in progress. The Asia-Pacific market is a mixed bag. There are no signs of construction recovery in China, and overall, competition with Chinese exporters has never been more intense. The biggest surprise during the quarter, however, came from South Korea. Due to the recent political upheaval, we had a couple cancellations and a few hot deals that dried up, worth roughly $8 million in sales. Lastly, Australia continues to be steady. The mobile business continues to be stable, and demand for tower cranes is gaining steam with new product deliveries and a robust aftermarket. With that, I'll pass it to Brian to walk you through the financials before I close with an update on our strategy.