Hyster-Yale Q1 Shipments, Backlog Higher Year/Year

Hyster-Yale Materials Handling’s lift truck business reported Q1/18 net income of $20.7 million and revenues of $743.3 million compared with net income of $22.3 million and revenues of $672.2 million for Q1/17. Lift truck operating profit was $26.6 million for Q1/18 compared with $29.8 million for the same quarter in 2017.

Worldwide new unit shipments increased to approximately 24,800 units in Q1/18 from approximately 23,300 units in Q1/17.

Q1/18 bookings were approximately 27,100 units, or approximately $620 million, compared with approximately 24,800 units, or approximately $550 million, in Q1/17.

Worldwide backlog was approximately 36,100 units, or approximately $930 million, at March 31, 2018 compared with approximately 32,200 units, or approximately $750 million, at March 31, 2017 and approximately 33,800 units, or approximately $860 million, at December 31, 2017.

The increase in the average unit backlog value is due to the mix of products within backlog since the company has sold more higher-value units, and fewer lower-value Class 3 products as a result of competitive pressures, most notably from Chinese produced products.

Americas – Outlook

In Q1/18, the Americas market continued the double digit growth experienced in 2017, primarily as a result of strong growth in the North America Class 5 internal combustion engine market and substantial growth in the smaller Brazil market as the economic climate in that country continued to improve.

While there are positive economic indicators in many of the company’s industry segments, the company believes that some of the market growth resulted from certain customers placing orders early in anticipation of increasing prices from material cost inflation and new tariffs. As a result, in 2018, the company expects the Americas market to continue to grow but at a more moderate rate than the double digit growth experienced in Q1/18. In this market environment, and as share gain initiatives mature, unit shipments, revenues and parts sales are expected to increase over the remainder of 2018 compared with the same period in 2017. However, benefits anticipated in operating profit from an increase in unit shipments are expected to be offset by material and manufacturing cost inflation, net of price increases; higher operating expense levels as further investments in sales capabilities are made to fund growth initiatives; and a shift in mix to lower-margin Class 1, Class 2 and Class 5 units.

As previously announced, Hyster-Yale entered into a definitive agreement in December 2017 to acquire 75% of the outstanding shares of, and a controlling interest in, Zhejiang Maximal Forklift Company (Maximal) for an aggregate purchase price of $90 million. The remaining 25% share of Maximal will be owned by Maximal’s current senior management. The closing of the transaction, which is expected to take place during Q2/18, is subject to customary closing conditions and required regulatory approvals.

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