TEREX CORP [TEX] Filings

10-Q 1 tex-20240630.htm 10-Q TEREX CORPORATION JUNE 30, 2024 tex-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 1-10702

$Tx_RedBlk.jpg$

Terex Corporation

(Exact name of registrant as specified in its charter)


Delaware						34-1531521
(State of Incorporation)						(IRS Employer Identification No.)

45 Glover Ave, 4th Floor, Norwalk, Connecticut 06850

(Address of principal executive offices)

(203) 222-7170

(Registrant’s telephone number, including area code)

_______________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock ($0.01 par value)	TEX	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

Number of outstanding shares of common stock: 66.9 million as of July 25, 2024.


The Exhibit Index begins on page 44.

GENERAL

This Quarterly Report on Form 10-Q filed by Terex Corporation generally speaks as of June 30, 2024 unless specifically noted otherwise. Unless otherwise indicated, Terex Corporation, together with its consolidated subsidiaries, is hereinafter referred to as “Terex,” the “Registrant,” “us,” “we,” “our” or the “Company.”

Forward-Looking Information

Certain information in this Quarterly Report includes forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) and the Private Securities Litigation Reform Act of 1995) regarding future events or our future financial performance that involve certain contingencies and uncertainties, including those discussed below in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Contingencies and Uncertainties.” In addition, when included in this Quarterly Report or in documents incorporated herein by reference, the words “may,” “expects,” “should,” “intends,” “anticipates,” “believes,” “plans,” “projects,” “estimates,” “will” and the negatives thereof and analogous or similar expressions are intended to identify forward-looking statements. However, the absence of these words does not mean that the statement is not forward-looking. We have based these forward-looking statements on current expectations and projections about future events. These statements are not guarantees of future performance. Such statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those reflected in such forward-looking statements. Such risks and uncertainties, many of which are beyond our control, include, among others:

•we may be unable to successfully integrate acquired businesses, including the Environmental Solutions Group business;

•we may not realize expected benefits for any acquired businesses within the timeframe anticipated or at all;

•our operations are subject to a number of potential risks that arise from operating a multinational business, including political and economic instability and compliance with changing regulatory environments;

•changes in the availability and price of certain materials and components, which may result in supply chain disruptions;

•consolidation within our customer base and suppliers;

•our business may suffer if our equipment fails to perform as expected;

•a material disruption to one of our significant facilities;

•our business is sensitive to general economic conditions, government spending priorities and the cyclical nature of markets we serve;

•our consolidated financial results are reported in United States (“U.S.”) dollars while certain assets and other reported items are denominated in the currencies of other countries, creating currency exchange and translation risk;

•our need to comply with restrictive covenants contained in our debt agreements;

•our ability to generate sufficient cash flow to service our debt obligations and operate our business;

•our ability to access the capital markets to raise funds and provide liquidity;

•the financial condition of customers and their continued access to capital;

•exposure from providing credit support for some of our customers;

•we may experience losses in excess of recorded reserves;

•our industry is highly competitive and subject to pricing pressure;

•our ability to successfully implement our strategy and the actual results derived from such strategy;

•increased cybersecurity threats and more sophisticated computer crime;

•increased regulatory focus on privacy and data security issues and expanding laws;

•our ability to attract, develop, engage and retain team members;

•possible work stoppages and other labor matters;

•litigation, product liability claims and other liabilities;

•changes in import/export regulatory regimes, imposition of tariffs, escalation of global trade conflicts and unfairly traded imports, particularly from China, could continue to negatively impact our business;

•compliance with environmental regulations could be costly and failure to meet sustainability expectations or standards or achieve our sustainability goals could adversely impact our business;

•our compliance with the U.S. Foreign Corrupt Practices Act and similar worldwide anti-corruption laws;

•our ability to comply with an injunction and related obligations imposed by the U.S. Securities and Exchange Commission; and

•other factors.

Actual events or our actual future results may differ materially from any forward-looking statement due to these and other risks, uncertainties and material factors. The forward-looking statements contained herein speak only as of the date of this Quarterly Report and the forward-looking statements contained in documents incorporated herein by reference speak only as of the date of the respective documents. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained or incorporated by reference in this Quarterly Report to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

TEREX CORPORATION AND SUBSIDIARIES

Index to Quarterly Report on Form 10-Q

For the Quarterly Period Ended June 30, 2024



		PAGE
PART I	FINANCIAL INFORMATION	4

Item 1	Financial Statements	4





Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4	Controls and Procedures	40

PART II	OTHER INFORMATION	41

Item 1	Legal Proceedings	41
Item 1A	Risk Factors	41
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3	Defaults Upon Senior Securities	43
Item 4	Mine Safety Disclosures	43
Item 5	Other Information	43
Item 6	Exhibits	44

SIGNATURES		45

PART I.FINANCIAL INFORMATION


ITEM 1.			FINANCIAL STATEMENTS

TEREX CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)

(unaudited)

(in millions, except per share data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net sales	$	1,381.7	$	1,403.1	$	2,674.2	$	2,638.8
Cost of goods sold	(1,053.3)		(1,060.2)		(2,048.5)		(2,017.2)
Gross profit	328.4		342.9		625.7		621.6
Selling, general and administrative expenses	(135.3)		(133.0)		(274.3)		(264.0)
Income (loss) from operations	193.1		209.9		351.4		357.6
Other income (expense)
Interest income	2.0		1.1		5.6		3.1
Interest expense	(15.6)		(15.4)		(30.6)		(30.3)

Other income (expense) – net	(5.4)		(3.8)		(15.8)		(5.4)
Income (loss) from continuing operations before income taxes	174.1		191.8		310.6		325.0
(Provision for) benefit from income taxes	(33.4)		(32.0)		(61.4)		(55.3)
Income (loss) from continuing operations	140.7		159.8		249.2		269.7

Gain (loss) on disposition of discontinued operations – net of tax	—		(0.4)		—		2.3
Net income (loss)	$	140.7	$	159.4	$	249.2	$	272.0









Basic earnings (loss) per share:
Income (loss) from continuing operations	$	2.09	$	2.36	$	3.71	$	3.98

Gain (loss) on disposition of discontinued operations – net of tax	—		—		—		0.04
Net income (loss)	$	2.09	$	2.36	$	3.71	$	4.02
Diluted earnings (loss) per share:
Income (loss) from continuing operations	$	2.08	$	2.35	$	3.68	$	3.94

Gain (loss) on disposition of discontinued operations – net of tax	—		(0.01)		—		0.03
Net income (loss)	$	2.08	$	2.34	$	3.68	$	3.97
Weighted average number of shares outstanding in per share calculation
Basic	67.2		67.6		67.1		67.7
Diluted	67.7		68.1		67.8		68.5



Comprehensive income (loss)	$	113.9	$	169.4	$	193.6	$	308.3

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEREX CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

(unaudited)

(in millions, except par value)


	June 30, 2024		December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	319.3	$	370.7
Receivables (net of allowance of $10.4 and $8.3 at June 30, 2024 and December 31, 2023, respectively)	719.4		547.8
Inventories	1,232.8		1,186.0
Prepaid and other current assets	130.1		140.7

Total current assets	2,401.6		2,245.2
Non-current assets
Property, plant and equipment – net	574.5		569.8

Goodwill	291.3		294.6
Intangible assets – net	14.1		15.7

Other assets	498.0		490.2

Total assets	$	3,779.5	$	3,615.5

Liabilities and Stockholders’ Equity
Current liabilities
Current portion of long-term debt	$	3.4	$	2.8
Trade accounts payable	703.7		702.6
Accrued compensation and benefits	98.6		135.6




Other current liabilities	282.2		278.2

Total current liabilities	1,087.9		1,119.2
Non-current liabilities
Long-term debt, less current portion	662.2		620.4


Other non-current liabilities	205.5		203.6

Total liabilities	1,955.6		1,943.2
Commitments and contingencies

Stockholders’ equity
Common stock, $0.01 par value – authorized 300.0 shares; issued 85.1 and 84.6 shares at June 30, 2024 and December 31, 2023, respectively	0.9		0.9
Additional paid-in capital	909.0		906.1
Retained earnings	1,900.8		1,674.8
Accumulated other comprehensive income (loss)	(342.7)		(287.1)
Less cost of shares of common stock in treasury – 18.8 and 18.5 shares at June 30, 2024 and December 31, 2023	(644.1)		(622.4)


Total stockholders’ equity	1,823.9		1,672.3
Total liabilities and stockholders’ equity	$	3,779.5	$	3,615.5

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEREX CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

(unaudited)

(in millions)


	Outstanding Shares	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Common Stock in Treasury		Total
Balance at December 31, 2023	66.1	$	0.9	$	906.1	$	1,674.8	$	(287.1)	$	(622.4)	$	1,672.3
Net income (loss)	—	—		—		108.5		—		—		108.5
Other comprehensive income (loss) – net of tax	—	—		—		—		(28.8)		—		(28.8)
Issuance of common stock related to compensation	0.5	—		24.4		—		—		—		24.4
Compensation under stock-based plans – net	—	—		(30.6)		—		—		0.5		(30.1)

Dividends	—	—		0.2		(11.6)		—		—		(11.4)





Acquisition of treasury stock	—	—		—		—		—		(3.0)		(3.0)

Balance at March 31, 2024	66.6	$	0.9	$	900.1	$	1,771.7	$	(315.9)	$	(624.9)	$	1,731.9
Net income (loss)	—	—		—		140.7		—		—		140.7
Other comprehensive income (loss) – net of tax	—	—		—		—		(26.8)		—		(26.8)
Issuance of common stock related to compensation	—	—		0.8		—		—		—		0.8
Compensation under stock-based plans – net	—	—		8.0		—		—		—		8.0
Dividends	—	—		0.1		(11.6)		—		—		(11.5)
Acquisition of treasury stock	(0.3)	—		—		—		—		(19.2)		(19.2)

Balance at June 30, 2024	66.3	$	0.9	$	909.0	$	1,900.8	$	(342.7)	$	(644.1)	$	1,823.9


	Outstanding Shares	Common Stock		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Common Stock in Treasury		Total
Balance at December 31, 2022	66.8	$	0.9	$	881.6	$	1,200.6	$	(341.6)	$	(560.3)	$	1,181.2
Net income (loss)	—	—		—		112.6		—		—		112.6
Other comprehensive income (loss) – net of tax	—	—		—		—		26.3		—		26.3
Issuance of common stock related to compensation	0.6	—		9.5		—		—		—		9.5
Compensation under stock-based plans – net	—	—		(22.3)		—		—		1.5		(20.8)

Dividends	—	—		0.1		(10.3)		—		—		(10.2)





Acquisition of treasury stock	(0.1)	—		—		—		—		(4.0)		(4.0)

Balance at March 31, 2023	67.3	$	0.9	$	868.9	$	1,302.9	$	(315.3)	$	(562.8)	$	1,294.6
Net income (loss)	—	—		—		159.4		—		—		159.4
Other comprehensive income (loss) – net of tax	—	—		—		—		10.0		—		10.0
Issuance of common stock related to compensation	—	—		0.4		—		—		—		0.4
Compensation under stock-based plans – net	—	—		9.6		—		—		—		9.6
Dividends	—	—		0.2		(10.3)		—		—		(10.1)
Acquisition of treasury stock	(0.6)	—		—		—		—		(31.6)		(31.6)
Other	—	—		—		—		—		(0.1)		(0.1)
Balance at June 30, 2023	66.7	$	0.9	$	879.1	$	1,452.0	$	(305.3)	$	(594.5)	$	1,432.2

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEREX CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited)

(in millions)


	Six Months Ended June 30,
	2024		2023
Operating Activities
Net income (loss)	$	249.2	$	272.0
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	30.0		24.9





Stock-based compensation expense	18.0		17.3
Inventory and other non-cash charges	24.7		9.8
Changes in operating assets and liabilities (net of effects of acquisitions and divestitures):
Receivables	(183.7)		(128.8)
Inventories	(86.1)		(141.2)
Trade accounts payable	26.0		67.5


Other assets and liabilities	(43.1)		8.0
Foreign exchange and other operating activities, net	(2.4)		0.3
Net cash provided by (used in) operating activities	32.6		129.8
Investing Activities
Capital expenditures	(59.2)		(39.1)
Proceeds from sale of capital assets	0.1		33.5
Acquisitions, net of cash acquired, and investments	(1.8)		(15.8)



Other investing activities, net	9.6		0.4
Net cash provided by (used in) investing activities	(51.3)		(21.0)
Financing Activities
Repayments of debt	(90.5)		(229.8)
Proceeds from issuance of debt	131.0		187.7




Share repurchases	(21.5)		(35.4)
Dividends paid	(22.8)		(20.3)

Other financing activities, net	(18.6)		(21.2)
Net cash provided by (used in) financing activities	(22.4)		(119.0)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(10.3)		3.8
Net Increase (Decrease) in Cash and Cash Equivalents	(51.4)		(6.4)
Cash and Cash Equivalents at Beginning of Period	370.7		304.1
Cash and Cash Equivalents at End of Period	$	319.3	$	297.7

The accompanying notes are an integral part of these condensed consolidated financial statements.

TEREX CORPORATION AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

NOTE A – BASIS OF PRESENTATION

Basis of Presentation and Principles of Consolidation. The accompanying unaudited Condensed Consolidated Financial Statements of Terex Corporation and subsidiaries as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by U.S. GAAP to be included in full-year financial statements. The accompanying Condensed Consolidated Balance Sheet as of December 31, 2023 has been derived from audited consolidated financial statements as of that date, but does not include all disclosures required by U.S. GAAP. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for year ended December 31, 2023.

The Condensed Consolidated Financial Statements include accounts of Terex Corporation, its majority-owned subsidiaries and other controlled subsidiaries (“Terex” or the “Company”). The Company consolidates all majority-owned and controlled subsidiaries, applies equity method of accounting for investments in which the Company is able to exercise significant influence and applies the cost method for investments which do not have readily determinable fair values. All intercompany balances, transactions and profits have been eliminated. Certain prior period amounts have been reclassified to conform with the 2024 presentation.

In the opinion of management, adjustments considered necessary for the fair statement of these interim financial statements have been made. Except as otherwise disclosed, all such adjustments consist only of those of a normal recurring nature. Operating results for the three and six months ended June 30, 2024 are not necessarily indicative of results that may be expected for the year ending December 31, 2024.

Accounting Standards to be Implemented. In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires additional segment reporting disclosures, primarily through enhanced disclosures about significant segment expenses. ASU 2023-07 requires that companies disclose, at the reportable segment level, the significant segment expenses regularly provided to the chief operating decision maker (“CODM”), as well as the amount and composition of other segment items. The ASU also requires companies to disclose the title and position of the CODM and how the CODM uses the reported measures of a segment’s profit or loss when assessing performance and deciding how to allocate resources. Additionally, the ASU mandates that all segment disclosures currently required annually by Topic 280, including the enhancements outlined in the ASU, be disclosed on an interim basis. The guidance is effective for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024. The Company is currently evaluating the impact of this guidance on its disclosures to consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires disclosure in the rate reconciliation table additional categories of information about federal, state and foreign income taxes and provide more details about the reconciliation items in some categories if the items meet a quantitative threshold. The guidance also requires disclosure of income taxes paid, net of refunds, disaggregated by federal (national), state and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold. The guidance is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of this guidance on its disclosures to consolidated financial statements.

Receivables and Allowance for Doubtful Accounts. Receivables include $664.7 million and $493.8 million of trade accounts receivable at June 30, 2024 and December 31, 2023, respectively. Trade accounts receivable are recorded at invoiced amount and do not bear interest. Allowance for doubtful accounts is the Company’s estimate of current expected credit losses on its existing accounts receivable and determined based on historical customer assessments, current financial conditions, and reasonable and supportable forecasts. Account balances are charged off against the allowance when the Company determines the receivable will not be recovered. There can be no assurance that the Company’s estimate of accounts receivable collection will be indicative of future results.

The following table summarizes changes in the consolidated allowance for doubtful accounts (in millions):




Balance as of December 31, 2023	$	8.3
Provision for credit losses	2.6
Other (1)	(0.5)
Balance as of June 30, 2024	$	10.4
(1) Includes utilization of established reserves, net of recoveries and the impact of foreign exchange rate changes.

Supplier Finance. The Company has a supplier finance program to pay a third-party bank the stated amount of confirmed invoices from its designated suppliers on the original maturity dates of the invoices. Terex or the bank may terminate the agreement upon 30 days’ notice. The supplier invoices that have been confirmed as valid under the program require payment in full within 60-90 days of invoice date. Confirmed obligation amounts outstanding were immaterial at June 30, 2024 and December 31, 2023.

Guarantees. The Company issues guarantees to financial institutions related to financing of equipment purchases by customers. The expectation of losses or non-performance is evaluated based on consideration of historical customer assessments, current financial conditions, reasonable and supportable forecasts, equipment collateral value and other factors. Reserves are recorded for expected loss over the contractual period of risk exposure. See Note K – “Litigation and Contingencies” for additional information regarding guarantees issued to financial institutions.

Accrued Warranties. The Company records accruals for potential warranty claims based on its claim experience. The Company’s products are typically sold with a standard warranty covering defects that arise during a fixed period. Each business provides a warranty specific to products it offers. The specific warranty offered by a business is a function of customer expectations and competitive forces. Warranty length is generally a fixed period of time, a fixed number of operating hours or both.

A liability for estimated warranty claims is accrued at the time of sale. The current portion of the product warranty liability is included in Other current liabilities and the non-current portion is included in Other non-current liabilities in the Company’s Condensed Consolidated Balance Sheet. The liability is established using historical warranty claims experience for each product sold. Historical claims experience may be adjusted for known design improvements or for the impact of unusual product quality issues. Assumptions are updated for known events that may affect the potential warranty liability.

The following table summarizes changes in the consolidated product warranty liability (in millions):




Balance as of December 31, 2023	$	47.8
Accruals for warranties issued during the period	19.2
Changes in estimates	1.7
Settlements during the period	(23.1)
Foreign exchange effect/other	(0.6)
Balance as of June 30, 2024	$	45.0

Fair Value Measurements. Assets and liabilities measured at fair value on a recurring basis under the provisions of Accounting Standards Codification (“ASC”) 820, “Fair Value Measurement and Disclosure” (“ASC 820”) include commodity swaps, cross currency swaps and foreign exchange contracts discussed in Note H – “Derivative Financial Instruments” and debt discussed in Note I – “Long-Term Obligations”. These instruments are valued using observable market data for similar assets and liabilities or the present value of future cash payments and receipts. ASC 820 establishes a fair value hierarchy for those instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s assumptions (unobservable inputs). The hierarchy consists of three levels:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and

Level 3 – Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e. supported by little or no market activity).

Determining which category an asset or liability falls within this hierarchy requires judgment. The Company evaluates its hierarchy disclosures each quarter.

NOTE B – BUSINESS SEGMENT INFORMATION

Terex is a global manufacturer of materials processing machinery and aerial work platforms. The Company designs, builds and supports products used in maintenance, manufacturing, energy, recycling, minerals and materials management, and construction applications. Certain Terex products and solutions enable customers to reduce their impact on the environment including electric and hybrid offerings that deliver quiet and emission-free performance, products that support renewable energy, and products that aid in the recovery of useful materials from various types of waste. The Company’s products are manufactured in North America, Europe, Australia and Asia and sold worldwide. Terex engages with customers through all stages of the product life cycle, from initial specification to parts and service support.

The Company identifies its operating segments according to how business activities are managed and evaluated, and has identified three operating segments: Materials Processing (“MP”), Aerials and Utilities. As Aerials and Utilities operating segments share similar economic characteristics, these operating segments are aggregated into one reportable segment, Aerial Work Platforms (“AWP”). The Company operates in two reportable segments: (i) MP and (ii) AWP.

MP designs, manufactures, services and markets materials processing and specialty equipment, including crushers, washing systems, screens, trommels, apron feeders, material handlers, pick and carry cranes, rough terrain cranes, tower cranes, wood processing, biomass and recycling equipment, concrete mixer trucks and concrete pavers, conveyors, and their related components and replacement parts. Customers use these products in construction, infrastructure and recycling projects, in various quarrying and mining applications, as well as in landscaping and biomass production industries, material handling applications, maintenance applications to lift equipment or material, moving materials and equipment on rugged or uneven terrain, lifting construction material and placing material at point of use.

AWP designs, manufactures, services and markets aerial work platform equipment, utility equipment and telehandlers as well as their related components and replacement parts. Customers use these products to construct and maintain industrial, commercial, institutional and residential buildings and facilities, for construction and maintenance of transmission and distribution lines, tree trimming, certain construction and foundation drilling applications, and for other commercial operations, as well as in a wide range of infrastructure projects.

The Company assists customers in their rental, leasing and acquisition of its products through Terex Financial Services (“TFS”). TFS uses its equipment financing experience to facilitate financial products and services to assist customers in the acquisition of the Company’s equipment. TFS is included in Corporate and Other.

Corporate and Other also includes eliminations among the two reportable segments, as well as general and corporate items.

Business segment information is presented below (in millions):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Net sales

MP	$	498.6	$	577.4	$	1,018.6	$	1,131.2
AWP	881.8		824.9		1,654.5		1,510.8
Corporate and Other / Eliminations	1.3		0.8		1.1		(3.2)
Total	$	1,381.7	$	1,403.1	$	2,674.2	$	2,638.8
Income (loss) from operations

MP	$	77.0	$	98.2	$	149.1	$	183.5
AWP	133.8		133.6		241.1		216.7
Corporate and Other / Eliminations	(17.7)		(21.9)		(38.8)		(42.6)
Total	$	193.1	$	209.9	$	351.4	$	357.6


	June 30, 2024		December 31, 2023
Identifiable assets

MP	$	2,013.8	$	2,091.4
AWP	2,414.1		2,216.2
Corporate and Other / Eliminations	(648.4)		(692.1)

Total	$	3,779.5	$	3,615.5

Sales between segments are generally priced to recover costs plus a reasonable markup for profit, which is eliminated in consolidation.

Geographic net sales information is presented below (in millions):


	Three Months Ended June 30, 2024								Three Months Ended June 30, 2023
	MP		AWP		Corporate and Other / Eliminations		Total			MP		AWP		Corporate and Other / Eliminations		Total
Net sales by region
North America	$	242.2	$	650.2	$	0.7	$	893.1		$	260.6	$	584.3	$	3.4	$	848.3
Western Europe	116.2		131.6		0.2		248.0			164.5		123.3		—		287.8
Asia-Pacific	88.3		51.3		0.9		140.5			102.8		57.6		—		160.4
Rest of World (1)	51.9		48.7		(0.5)		100.1			49.5		59.7		(2.6)		106.6
Total (2)	$	498.6	$	881.8	$	1.3	$	1,381.7		$	577.4	$	824.9	$	0.8	$	1,403.1

(1) Includes intercompany sales and eliminations.

(2) Total sales include $809.8 million and $771.4 million for the three months ended June 30, 2024 and 2023, respectively, attributable to the U.S., the Company’s country of domicile.


	Six Months Ended June 30, 2024								Six Months Ended June 30, 2023
	MP		AWP		Corporate and Other / Eliminations		Total		MP		AWP		Corporate and Other / Eliminations		Total
Net sales by region
North America	$	478.3	$	1,206.3	$	2.9	$	1,687.5	$	508.6	$	1,017.9	$	6.2	$	1,532.7
Western Europe	252.3		257.3		0.3		509.9		315.1		263.5		0.1		578.7
Asia-Pacific	191.4		95.2		0.9		287.5		200.7		112.0		0.2		312.9
Rest of World (1)	96.6		95.7		(3.0)		189.3		106.8		117.4		(9.7)		214.5
Total (2)	$	1,018.6	$	1,654.5	$	1.1	$	2,674.2	$	1,131.2	$	1,510.8	$	(3.2)	$	2,638.8

(1) Includes intercompany sales and eliminations.

(2) Total sales include $1.5 billion and $1.4 billion for the six months ended June 30, 2024 and 2023, respectively, attributable to the U.S., the Company’s country of domicile.

The Company attributes sales to unaffiliated customers in different geographical areas based on the location of the customer.

Product type net sales information is presented below (in millions):


	Three Months Ended June 30, 2024								Three Months Ended June 30, 2023
	MP		AWP		Corporate and Other / Eliminations		Total		MP		AWP		Corporate and Other / Eliminations		Total
Net sales by product type
Aerial Work Platforms	$	—	$	624.9	$	0.3	$	625.2	$	—	$	585.1	$	0.6	$	585.7

Materials Processing Equipment	330.9		—		—		330.9		337.6		—		—		337.6
Specialty Equipment	167.7		—		0.1		167.8		240.0		—		0.3		240.3
Utility Equipment	—		150.9		—		150.9		—		156.9		—		156.9
Other (1)	—		106.0		0.9		106.9		(0.2)		82.9		(0.1)		82.6


Total	$	498.6	$	881.8	$	1.3	$	1,381.7	$	577.4	$	824.9	$	0.8	$	1,403.1

(1) Includes other product types, intercompany sales and eliminations.


	Six Months Ended June 30, 2024								Six Months Ended June 30, 2023
	MP		AWP		Corporate and Other / Eliminations		Total		MP		AWP		Corporate and Other / Eliminations		Total
Net sales by product type
Aerial Work Platforms	$	—	$	1,167.0	$	1.0	$	1,168.0	$	—	$	1,069.4	$	1.1	$	1,070.5
Materials Processing Equipment	687.9		—		—		687.9		672.0		—		—		672.0
Specialty Equipment	330.2		—		0.1		330.3		455.7		—		0.6		456.3
Utility Equipment	—		301.2		—		301.2		—		285.3		—		285.3
Other (1)	0.5		186.3		—		186.8		3.5		156.1		(4.9)		154.7
Total	$	1,018.6	$	1,654.5	$	1.1	$	2,674.2	$	1,131.2	$	1,510.8	$	(3.2)	$	2,638.8

(1) Includes other product types, intercompany sales and eliminations.

NOTE C – INCOME TAXES

During the three months ended June 30, 2024, the Company recognized income tax expense of $33.4 million on income of $174.1 million, an effective tax rate of 19.2%, as compared to income tax expense of $32.0 million on income of $191.8 million, an effective tax rate of 16.7%, for the three months ended June 30, 2023. The higher effective tax rate for the three months ended June 30, 2024 when compared with the three months ended June 30, 2023 is primarily due to higher tax related to geographic distribution of income and less favorable discrete items.

During the six months ended June 30, 2024, the Company recognized income tax expense of $61.4 million on income of $310.6 million, an effective tax rate of 19.8%, as compared to income tax expense of $55.3 million on income of $325.0 million, an effective tax rate of 17.0%, for the six months ended June 30, 2023. The higher effective tax rate for the six months ended June 30, 2024 when compared with the six months ended June 30, 2023 is primarily due to higher tax related to geographic distribution of income and less favorable discrete items.

On December 15, 2022, the European Union (“EU”) Member States formally adopted the EU’s Pillar Two Directive, which generally provides for a minimum effective tax rate of 15% for large corporations, as established by the Organization for Economic Co-operation and Development (“OECD”) Pillar Two Framework. A number of countries in which we operate have adopted legislation, many of which are effective in 2024 subject to the OECD transitional safe harbor rules, while other countries are still in the process of introducing legislation. The Company has determined the impact of enacted Pillar Two legislation on its financial statements is not material. The Company will continue to evaluate the financial statement impacts as additional Pillar Two rules are enacted.

NOTE D – EARNINGS PER SHARE


(in millions, except per share data)	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Income (loss) from continuing operations	$	140.7	$	159.8	$	249.2	$	269.7

Gain (loss) on disposition of discontinued operations – net of tax	—		(0.4)		—		2.3
Net income (loss)	$	140.7	$	159.4	$	249.2	$	272.0
Basic shares:
Weighted average shares outstanding	67.2		67.6		67.1		67.7
Earnings (loss) per share – basic:
Income (loss) from continuing operations	$	2.09	$	2.36	$	3.71	$	3.98

Gain (loss) on disposition of discontinued operations – net of tax	—		—		—		0.04
Net income (loss)	$	2.09	$	2.36	$	3.71	$	4.02
Diluted shares:
Weighted average shares outstanding – basic	67.2		67.6		67.1		67.7
Effect of dilutive securities:
Restricted stock	0.5		0.5		0.7		0.8
Diluted weighted average shares outstanding	67.7		68.1		67.8		68.5
Earnings (loss) per share – diluted:
Income (loss) from continuing operations	$	2.08	$	2.35	$	3.68	$	3.94

Gain (loss) on disposition of discontinued operations – net of tax	—		(0.01)		—		0.03
Net income (loss)	$	2.08	$	2.34	$	3.68	$	3.97

Non-vested restricted stock awards and restricted stock units (“Restricted Stock”) granted by the Company are treated as potential common shares outstanding in computing diluted earnings per share using the treasury stock method. Weighted average Restricted Stock of approximately 0.1 million and 0.5 million were outstanding during the three months ended June 30, 2024 and 2023, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance. Weighted average Restricted Stock of approximately 0.1 million and 0.3 million were outstanding during the six months ended June 30, 2024 and 2023, respectively, but were not included in the computation of diluted shares as the effect would be anti-dilutive or performance targets were not expected to be achieved for awards contingent upon performance.

NOTE E – INVENTORIES

Inventories consist of the following (in millions):


	June 30, 2024		December 31, 2023
Finished equipment	$	528.4	$	467.9
Replacement parts	177.3		185.6
Work-in-process	127.6		131.5
Raw materials and supplies	399.5		401.0
Inventories	$	1,232.8	$	1,186.0

Inventory reserves were $71.3 million and $70.5 million at June 30, 2024 and December 31, 2023, respectively.

NOTE F – PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment – net consist of the following (in millions):


	June 30, 2024		December 31, 2023
Property	$	76.1	$	75.1
Plant	310.4		302.4
Equipment	509.5		492.3
Leasehold improvements	53.3		51.8
Construction in progress	71.9		73.4
Property, plant and equipment – gross	1,021.2		995.0
Less: Accumulated depreciation	(446.7)		(425.2)
Property, plant and equipment – net	$	574.5	$	569.8

NOTE G – GOODWILL AND INTANGIBLE ASSETS

An analysis of changes in the Company’s goodwill by business segment is as follows (in millions):


	MP		AWP		Total
Balance at December 31, 2023, gross	$	217.5	$	138.9	$	356.4
Accumulated impairment	(23.2)		(38.6)		(61.8)
Balance at December 31, 2023, net	194.3		100.3		294.6


Foreign exchange effect and other	(2.7)		(0.6)		(3.3)
Balance at June 30, 2024, gross	214.8		138.3		353.1
Accumulated impairment	(23.2)		(38.6)		(61.8)
Balance at June 30, 2024, net	$	191.6	$	99.7	$	291.3

Intangible assets, net were comprised of the following (in millions):


		June 30, 2024						December 31, 2023
	Weighted Average Life (in years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Definite-lived intangible assets:
Technology	7	$	9.4	$	(9.2)	$	0.2	$	9.6	$	(9.5)	$	0.1
Customer Relationships	17	35.1		(29.2)		5.9		35.5		(28.7)		6.8
Land Use Rights	80	3.9		(0.8)		3.1		3.9		(0.8)		3.1
Other	9	29.9		(25.0)		4.9		30.3		(24.6)		5.7
Total definite-lived intangible assets		$	78.3	$	(64.2)