Terex (TEX) Q4 2024 earnings summary

Executive summary

• Full-year 2024 net sales were $5.1 billion, with adjusted EPS of $6.11, the second highest in company history, and Q4 results consistent with prior outlook.

• ESG acquisition closed in Q4 2024, immediately accretive, contributing $51 million EBITDA and 22% margin post-close, and driving segment growth and margin improvement.

• Integration of ESG and Terex Utilities into the new Environmental Solutions segment positions the company for future growth and reduces cyclicality.

• Backlog at $2.3 billion, with ESG backlog up 16% year-over-year; AWP and MP backlogs in line with historical norms.

• Company remains focused on safety, operational efficiency, innovation, and investments in automation and digitization.

Financial highlights

• Q4 net sales were $1.2 billion, up slightly year-over-year due to ESG, while legacy segment sales declined 17%.

• Q4 gross margin was 19%, impacted by lower legacy margins but offset by ESG accretion; Q4 operating profit was $97 million (7.8%), EPS was $0.77, and EBITDA was $114 million.

• Full-year net sales were $5.1 billion, gross margin 21.7%, operating profit $582 million (11.3%), and EBITDA $642 million (12.5%).

• Free cash flow for the year was $190 million, down from $366 million in 2023 due to higher interest, working capital, and absence of prior year one-time benefit.

• Adjusted ROIC for FY 2024 was 19.4%.

Outlook and guidance

• 2025 net sales expected between $5.3 and $5.5 billion, segment operating margin ~12%, and EBITDA around $660 million.

• 2025 EPS guidance is $4.70–$5.10, with lower legacy volume offset by ESG growth.

• Free cash flow expected to rise to $300–$350 million in 2025, driven by working capital reductions and full-year ESG contribution.

• Q1 2025 EPS to represent about 10% of full-year, with 2/3 of earnings in Q2 and Q3.

• Aerials sales expected down low double digits, MP down high single digits, ESG up mid single digits; industry-wide channel adjustments in Aerials and MP expected to persist into H1 2025.