Shares of Terex Corporation (NYSE:TEX) slumped over 5% on Thursday after the company slashed its full-year 2024 earnings forecast.
The heavy machinery manufacturer now expects adjusted earnings per share (EPS) to range between $5.80 and $6.20, down from its previous forecast of $7.15 to $7.45.
Revenue is projected to come in between $4.85 billion and $5.05 billion, reflecting adjustments to customer demand and inventory levels. This was also lower than the previous expectation of $5.1 billion to $5.3 billion.
In a press release, Terex cited weaker-than-expected global sales as the primary driver behind the lowered outlook.
Simon Meester, President and CEO of Terex, commented, "Our channels globally made adjustments faster than we anticipated, resulting in lower than expected sales volume."
He highlighted that Terex's Aerial Work Platforms (AWP) customers reduced deliveries to match their fleet configurations with seasonal rental demand.
Additionally, the company's Materials Processing (MP) dealers adjusted inventory levels as end-users became more cautious due to the uncertain macroeconomic environment.
Despite the near-term challenges, Meester reaffirmed the company's commitment to its long-term growth strategies, stating that "long-term mega trends remain intact."
He also said Terex is taking steps to align its cost structure and production plans to current market conditions.
On a more positive note, Meester highlighted Terex's acquisition of Environmental Solutions Group (ESG), which is expected to close early in the fourth quarter.
The acquisition, he noted, would help reduce the company's cyclical exposure and is expected to add approximately $45 million in adjusted EBITDA in Q4. The deal is seen as a strategic move to enhance operational and commercial synergies across the company's AWP and MP divisions.
Terex said it will host a conference call to review its third quarter 2024 financial results on Wednesday, October 30.