Manitowoc Company, Inc. (The)

Good morning and welcome to the Manitowoc Company third quarter 2025 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 remarks, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Ian 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 third quarter 2025 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 and Chief Executive Officer, and Brian Regan, our Executive Vice President and Chief Financial Officer. Earlier this morning, we posted our slide presentation on the investor relations section of 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 turn the call over to Aaron. Thank you, Ion, and good morning, everyone. Please turn to slide three. To start, I'd like to thank the Manitowoc team for their hard work and persistence through a very complicated period. The Great Trade Reset continues to unfold, presenting new challenges every day. Nevertheless, our team continues to fight to the process, service our customers, and execute our Cranes Plus 50 strategy to grow our aftermarket. Overall, I was pleased with the quarter, especially considering the tariff headwinds. Sequentially, the third quarter is usually much softer than the second quarter, but we were able to recover some lost ground. And compared to last year, the numbers look good, too. During the third quarter, we generated $553 million in revenue and adjusted EBITDA of $34 million, which was up 30% year over year. Orders were $491 million versus $425 million last year, and backlog ended the period at $667 million. Our non-new machine sales were $177 million, up 5% versus last year, reaching a record $667 million on a trailing 12-month basis. Please turn to slide four. Moving to the Minatwakwe, I recently visited our Zhang Zhizhong factory in China where we produce tower cranes for the Belt and Road markets. As we've mentioned on previous calls, we recently developed several new large capacity cranes and upgraded the factory to support their production. While it was great to see the value stream running in full swing, the biggest surprise to me was the improvements in the smaller crane value stream. The team has done an amazing job with kitting and point of use materials, significantly improving our flow and throughput in roughly half the space. Overall, the team increased its earned hours by 30% compared to last year with flat headcount, a great increase in productivity. A huge thanks to Zhonghua Shi, Kakka Ma, Gary Wong, and the rest of the team for a job well done. Next on safety, I want to recognize our team's ongoing efforts to improve our work environment. In the third quarter, we achieved a recordable injury rate, or RIR, of 0.83, which is a 36% drop from the same period last year. October was safety month here at Manitowoc, and we went all in. Adding to our already strong safety culture, it's an initiative we kicked off last year focused on preventing unsafe practices and encouraging the kind of positive safety behaviors that really make a difference. While zero injuries remains the ultimate goal, I'm proud of the momentum we continue to build toward it. Please move to slide five for my market update. Starting with Europe, I'm cautiously optimistic. Overall, I feel better about the macroeconomic environment While the French government's woes continue, both Germany and France show positive signs. Housing permits in both countries are up compared to last year, which is good news for our tower crane business. Additionally, the big three French construction companies have a good backlog heading into 2026. In Southern Europe, we see a lot of activity in Italy, and believe it or not, Spain is now dealing with a housing shortage, something few would have imagined 15 years ago. I'd like to add more color on Germany, where we see promising developments. The country has enacted an accelerated depreciation program, formed a 500 billion euro infrastructure fund, and most recently passed the Bal Turbo Law aimed at significantly reducing building regulations and fast-tracking construction approvals. There are plenty of needs to invest in the local infrastructure. The once famously precise Deutsche Bahn railway system has turned infamous for delays and needs serious investments. There are 4,000 bridges in need of replacement or repair, serious housing shortages persist, and electrical power remains an ongoing challenge. Turning to our products, tower crane orders for new machines grew 34% year over year, marking the fifth consecutive quarter. Sentiment is definitely improving, and dealer inventory for self-erecting cranes is at all-time lows in Germany. We see a recovery underway. On mobiles, I would say that all of the above applies, and it was reflected in our orders this quarter, increasing 28% versus last year. Turning to the Middle East, the market remains strong. Although Saudi Arabia has eased off a bit from its previous breakneck pace, the UAE has definitely picked up steam. The country has already started phase two of the massive data center outside of Abu Dhabi, requiring another 20 big cranes. And we are hearing that the next major announcement could be the new Dubai airport, which will require 150 tower cranes. And we're proud to share that the Construction Machinery Middle East publication recently honored Manitowoc with two awards. the Best New Tower Crane Award for the POTON NCT2205, which is operating on the Big Data Center project, and the Best New All-Terrain Crane for the Grove GMK6450-1. Turning to Asia, I recently visited China and South Korea. In China, the market is still pretty quiet. However, in South Korea, there is growing optimism. And as mentioned on the last call, Vietnam and Australia are also showing signs of a turnaround. In addition, we recently received some solid orders in Singapore and Hong Kong. Lastly, the T50 Summit Asian Forum recently named the new POTON MCT2205 one of the top five new products of the year. These recent awards underscore the value of the Manitowoc way and the power of listening to the voice of the customer. A big congratulations to our engineering team in China. Finally, in North America, total orders were up 20% during the third quarter, but the volatility surrounding the great trade rate set is continuing to create a lot of uncertainty. On top of the price elasticity impact of the tariffs, we face two other major tariff related obstacles. First, the Supreme Court is expected to decide on the reciprocal tariffs by the end of the year. If the court moves against the Trump administration, everyone expects a new tariff strategy will be implemented. But what that looks like is anybody's guess. The second issue involves the impact of steel derivative tariffs on specific products. In August, HTS codes covering all terrain cranes, tower cranes, and truck-mounted cranes were added to the initial list of products subject to the 50% tariff on steel components. Submissions for another round of HTS codes were made in September, and there will be another round of submissions next year. Although the situation is creating plenty of noise in the industry, we continue to push forward. The elementary is a bit mixed. It's definitely trending on the low end for rough terrain and all-terrain cranes, while boom trucks and crawlers are slightly elevated. Looking to the fourth quarter, given that most crane rental houses have had a good year, I expect that some customers will take advantage of the new accelerated depreciation scheme and do a little last-minute Christmas shopping. Lastly, our anti-dumping claim in the U.S. against Japanese crawler crane manufacturers continues. However, we expect it to be delayed due to the government shutdown. The bottom line is that we believe in fair trade and will strongly defend it. With that, I'll pass it on to Brian to walk you through the financials before I close with our strategy update.