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What changed in TEREX CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of TEREX CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+318 added−294 removedSource: 10-K (2025-02-07) vs 10-K (2024-02-09)

Top changes in TEREX CORP's 2024 10-K

318 paragraphs added · 294 removed · 227 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

59 edited+20 added−19 removed57 unchanged
Biggest changeDISTRIBUTION MATERIALS PROCESSING We distribute our MP products to customers through several channels including a global network of independent distributors, direct sales and rental companies. AERIAL WORK PLATFORMS Our aerial work platform and telehandler products are distributed principally through a global network of rental companies and independent distributors.
Biggest changeThe decrease from 2023 was primarily driven by improved customer deliveries, a return to historical ordering patterns and lower bookings outside of North America. ESG had backlog of $520 million at December 31, 2024. DISTRIBUTION MATERIALS PROCESSING We distribute our MP products to customers through several channels including a global network of independent distributors, direct sales and rental companies.
We were the first to market with an all-electric utility bucket truck, reducing emissions and noise as well as supporting our customers electrification and sustainability goals. Many Genie ® lift models offer all-electric or fuel-electric hybrid options that deliver quiet, emission-free performance, which is necessary for indoor working environments, as well as city centers with noise and emission restrictions.
We were the first to market with an all-electric utility bucket truck, reducing emissions and noise as well as supporting our customers electrification and sustainability goals. Many Genie ® lift models offer all-electric 13 or fuel-electric hybrid options that deliver quiet, emission-free performance, which is necessary for indoor working environments, as well as city centers with noise and emission restrictions.
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. Our products are manufactured in North America, Europe, Australia and Asia and sold worldwide.
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. Our products are manufactured in North America, Europe, and Asia Pacific and sold worldwide.
MATERIALS Information regarding principal materials, components and commodities and any risks associated with these items are included in Part II, Item 7A. – “Quantitative and Qualitative Disclosures about Market Risk – Commodities Risk.” 10 COMPETITION We face a competitive global manufacturing market for all of our products.
MATERIALS Information regarding principal materials, components and commodities and any risks associated with these items are included in Part II, Item 7A. – “Quantitative and Qualitative Disclosures about Market Risk – Commodities Risk.” 11 COMPETITION We face a competitive global manufacturing market for all of our products.
AWP has the following significant manufacturing operations: • Aerial work platform equipment is manufactured in Redmond and Moses Lake, Washington, Umbertide, Italy, Changzhou, China and Monterrey, Mexico; • Utility products are manufactured in Watertown and Huron, South Dakota and Changzhou, China; and • Telehandlers are manufactured in Umbertide, Italy and Monterrey, Mexico.
AWP has the following significant manufacturing operations: • Aerial work platform equipment is manufactured in Redmond and Moses Lake, Washington, Umbertide, Italy, Changzhou, China, Monterrey, Mexico and Sanand, India; • Utility products are manufactured in Watertown and Huron, South Dakota and Changzhou, China; and • Telehandlers are manufactured in Umbertide, Italy and Monterrey, Mexico.
They combine high road speed with all-terrain capability. • Rough terrain cranes move materials and equipment on rugged or uneven terrain and are often located on a single construction or work site for long periods.
They combine highway road speed with all-terrain capability. • Rough terrain cranes move materials and equipment on rugged or uneven terrain and are often located on a single construction or work site for long periods.
We market our MP products principally under the following brand names and business lines: Terex ® , Powerscreen ® , Fuchs ® , EvoQuip ® , Canica ® , Cedarapids ® , CBI ® , Simplicity ® , Franna ® , Terex Ecotec ® , Finlay ® , ProAll ® , ZenRobotics ® , Terex Washing Systems, Terex MPS, Terex Jaques ® , Terex Advance ® , ProStack ® , Terex Bid-Well ® , MDS tm , MARCO ® and Terex Recycling Systems.
We market our MP products principally under the following brand names and business lines: Terex ® , Powerscreen ® , Fuchs ® , EvoQuip ® , Canica ® , Cedarapids ® , CBI ® , Simplicity ® , Franna ® , Terex Ecotec ® , Finlay ® , ProAll ® , ZenRobotics ® , Terex Washing Systems, Terex MPS, Terex Jaques ® , Advance ® , ProStack ® , Bid-Well ® , MDS tm , MARCO ® , MAGNA tm , Terex Recycling Systems and Green-Tec tm .
These programs are grounded in The Terex Way and help participants build key skills and competencies. Business specific leadership programs are also conducted in each of our segments and additional training programs are offered around specific topics such as safety, DEI, technical skills, financial fundamentals, compliance, cybersecurity and harassment prevention.
These programs are grounded in The Terex Way and help participants build key skills and competencies. Business specific leadership programs are also conducted in each of our segments and additional training programs are offered around specific topics such as safety, culture and inclusion, technical skills, financial fundamentals, compliance, cybersecurity and harassment prevention.
We are accountable to our team members, customers and stockholders for achieving our goals while protecting our reputation and assets. • Respect : We provide a safe and healthy environment for our team members. We treat all people with dignity and respect. We value the differences in people’s thinking, backgrounds and cultures.
We are transparent in all our business dealings. We are accountable to our team members, customers and stockholders for achieving our goals while protecting our reputation and assets. • Respect : We provide a safe and healthy environment for our team members. We treat all people with dignity and respect. We value the differences in people’s thinking, backgrounds and cultures.
Where we can, we offer a flexible work environment, enabling team members to manage the demands of their personal and professional lives. DIVERSITY, EQUITY AND INCLUSION We are committed to recruiting, engaging, developing, and retaining diversity at all levels of our global workforce.
Where we can, we offer a flexible work environment, enabling team members to manage the demands of their personal and professional lives. CULTURE AND INCLUSION We are committed to recruiting, engaging, developing, and retaining team members at all levels of our global workforce.
The Terex Way continues to guide us on how we conduct business with our stakeholders: team members, customers, stockholders, suppliers, our communities and many others. It drives our unwavering focus on Zero Harm Safety, strong governance, Diversity, Equity & Inclusion (“DEI”), responsible environmental stewardship and sustainability, and support for the communities where we live and work.
The Terex Way continues to guide us on how we conduct business with our stakeholders: team members, customers, stockholders, suppliers, our communities and many others. It drives our unwavering focus on Zero Harm Safety, strong governance, culture and inclusion, responsible environmental stewardship and sustainability, and support for the communities where we live and work.
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.
Customers use these products to construct and maintain industrial, commercial, institutional and residential buildings and facilities, for purposes within the entertainment industry, 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.
We engage with customers through all stages of the product life cycle, from initial specification to parts and service support. We report our business in the following segments: (i) Materials Processing (“MP”) and (ii) Aerial Work Platforms (“AWP”).
We engage with customers through all stages of the product life cycle, from initial specification to parts and service support. We report our business in the following segments: (i) Materials Processing (“MP”), (ii) Aerial Work Platforms (“AWP”) and (iii) Environmental Solutions Group (“ESG”).
We believe cash generated from operations, including cash generated from the sale of receivables, loans from our bank credit facilities and funds raised in capital markets, will provide us with adequate liquidity to comply with our financial covenants under our bank credit facility, continue to support internal operating initiatives and meet our operating and debt service requirements for at least the next 12 months from the date of issuance of this annual report.
We believe cash generated from operations, including cash generated from the sale of receivables, will provide us with adequate liquidity to comply with our financial covenants under our bank credit facility, continue to support internal operating initiatives and meet our operating and debt service requirements for at least the next 12 months from the date of issuance of this annual report.
MP has the following significant manufacturing operations: • Mobile crushers are manufactured in Omagh, Northern Ireland; • Mobile screens, washing systems and recycling systems are manufactured in Dungannon, Northern Ireland; • Mobile crushers, mobile screens, base crushers, base screens, modular and wheeled crushing and screening plants, track conveyors, washing systems, rough terrain cranes and pick and carry cranes are manufactured in Hosur, India; • Mobile and static crushing and screening equipment and base crushers are manufactured in Oklahoma City, Oklahoma; • Static crushers, screens and telescopic conveyors are manufactured in Subang Jaya, Malaysia; • Crushing and screening equipment is manufactured in Durand, Michigan; • Mobile crushers and crushing chambers are manufactured in Coalville, England; • Wood processing, biomass and recycling equipment systems, mobile screens and tracked conveyors are manufactured in Campsie, Northern Ireland; • Fabrications, sub-assemblies and steel kits are manufactured in Ballymoney and Cookstown, Northern Ireland; • Wood processing, biomass and recycling equipment systems are manufactured in Newton, New Hampshire; • Material handlers are manufactured in Bad Schönborn, Germany and Changzhou, China; • Concrete pavers are manufactured in Canton, South Dakota; • Front discharge concrete mixer trucks are manufactured in Fort Wayne, Indiana; • Volumetric concrete mixers are manufactured in Olds, Alberta, Canada; • Pick and carry cranes are manufactured in Brisbane, Australia; • Rough terrain cranes are manufactured in Crespellano, Italy; • Tower cranes are manufactured in Fontanafredda, Italy; • Mobile crushers and mobile screens are manufactured in Jiading, China; • Mobile and static trommel screens are manufactured in Monaghan, Ireland; and • Bulk material handling conveyors are manufactured in Mount Vernon, Missouri. 4 We have North American distribution centers in Louisville, Kentucky and Southaven, Mississippi and service centers in Australia, Thailand, Turkey and Malaysia.
MP has the following significant manufacturing operations: • Mobile crushers are manufactured in Omagh, Northern Ireland; • Mobile screens, washing systems and recycling systems are manufactured in Dungannon, Northern Ireland; • Mobile crushers, mobile screens, base crushers, base screens, modular and wheeled crushing and screening plants, track conveyors, washing systems, rough terrain cranes and pick and carry cranes are manufactured in Hosur, India; • Static crushers, screens and telescopic conveyors are manufactured in Subang Jaya, Malaysia; • Crushing and screening equipment is manufactured in Durand, Michigan; • Mobile crushers and crushing chambers are manufactured in Coalville, England; • Wood processing, biomass and recycling equipment systems, mobile screens and tracked conveyors are manufactured in Campsie, Northern Ireland; • Fabrications, sub-assemblies and steel kits are manufactured in Ballymoney and Cookstown, Northern Ireland; • Wood processing, biomass and recycling equipment systems are manufactured in Newton, New Hampshire; • Material handlers are manufactured in Bad Schönborn, Germany and Changzhou, China; • Concrete pavers are manufactured in Canton, South Dakota; • Front discharge and rear discharge mini concrete mixer trucks are manufactured in Fort Wayne, Indiana; • Volumetric concrete mixers are manufactured in Olds, Alberta, Canada; • Pick and carry cranes are manufactured in Brisbane, Australia; • Rough terrain cranes are manufactured in Crespellano, Italy; • Tower cranes are manufactured in Fontanafredda, Italy; • Mobile crushers, including crushing chambers, mobile screens and material handlers are manufactured in Jiading, China; 4 • Mobile and static trommel screens are manufactured in Monaghan, Ireland; and • Bulk material handling conveyors are manufactured in Mount Vernon, Missouri.
The following table shows the primary competitors, in alphabetical order, for our products in the following categories: BUSINESS SEGMENT PRODUCTS PRIMARY COMPETITORS Materials Processing Crushing & Screening Equipment Astec Industries, Deere (Kleeman), Keestrack, Metso, Portafill, Rubble Master and Sandvik Washing Systems Azfab, CDE Global, Matec, McLanahan, Metso, Phoenix Process Equipment, Superior and Weir/Trio Wood Processing, Biomass, Recycling Equipment and Trommels Astec Industries, Bandit, Doppstadt, Eggersmann, Jenz, Komptech, Morbark and Vermeer Conveyors Astec/Telestack, Deere (Kleeman), Edge, Metso/McCloskey, Puzzulona Thor, Superior and Weir/Trio Material Handlers Atlas, Caterpillar, Liebherr and Sennebogen Concrete Pavers Allen Engineering, Gomaco, Guntert & Zimmerman and Power Curbers Concrete Mixer Trucks Beck Industrial, Con-Tech, Continental Mixer, McNeilus and Oshkosh Volumetric Concrete Mixers Bay-lynx, Cemen Tech, Holcombe and Zimmerman Pick and Carry Cranes Ace, Escorts, Humma and TIDD Rough Terrain Cranes Kato, Liebherr, Link-Belt, Manitowoc (Grove), Sany, Tadano-Faun, XCMG and Zoomlion Tower Cranes Comansa, Jaso, Liebherr, Manitowoc (Potain), Wolffkran, XCMG and Zoomlion Robotic Waste Sorting Technology AMP Robotics, Max-Al, Steinert, Tomra and Waste Robotics Aerial Work Platforms Portable Material Lifts and Portable Aerial Work Platforms Dingli, Haulotte and Oshkosh (JLG) Boom Lifts Dingli, Haulotte, JCB, Linamar (Skyjack), Manitou, MEC, Oshkosh (JLG), Sinoboom, XCMG and Zoomlion Scissor Lifts Dingli, Haulotte, JCB, LGMG, Linamar (Skyjack), MEC, Oshkosh (JLG), Sinoboom, XCMG and Zoomlion Utility Equipment Altec, Dur-A-Lift, Elliot Equipment, Palfinger, Posi+ and Time Manufacturing Telehandlers JCB, Linamar (Skyjack), Manitou (Gehl), Merlo and Oshkosh (JLG) MAJOR CUSTOMERS None of our customers individually accounted for more than 10% of our consolidated net sales in 2023.
The following table shows the primary competitors, in alphabetical order, for our products in the following categories: BUSINESS SEGMENT PRODUCTS PRIMARY COMPETITORS Materials Processing Crushing & Screening Equipment Astec Industries, Deere (Kleeman), Keestrack, Metso, Portafill, Rubble Master and Sandvik Washing Systems Azfab, CDE Global, Matec, McLanahan, Metso, Phoenix Process Equipment, Superior and Weir/Trio Wood Processing, Biomass, Recycling Equipment and Trommels Astec Industries, Bandit, Doppstadt, Eggersmann, Jenz, Komptech, Morbark and Vermeer Conveyors Astec/Telestack, Deere (Kleeman), Edge, Metso/McCloskey, Puzzulona Thor, Superior and Weir/Trio Material Handlers Atlas, Caterpillar, Liebherr and Sennebogen Concrete Pavers Allen Engineering, Gomaco, Guntert & Zimmerman and Power Curbers Concrete Mixer Trucks Beck Industrial, Con-Tech, Continental Mixer, Oshkosh (McNeilus) Volumetric Concrete Mixers Bay-lynx, Cemen Tech, Holcombe and Zimmerman Pick and Carry Cranes Ace, Escorts, Humma and TIDD Rough Terrain Cranes Kato, Liebherr, Link-Belt, Manitowoc (Grove), Sany, Tadano-Faun, XCMG and Zoomlion Tower Cranes Comansa, Jaso, Liebherr, Manitowoc (Potain), Wolffkran, XCMG and Zoomlion Robotic Waste Sorting Technology AMP Robotics, Max-Al, Steinert, Tomra and Waste Robotics Tree Care and Vegetation Management Equipment Albach Primtech, Bandit, Fecon, Jenz, Ufkes, Vermeer Aerial Work Platforms Portable Material Lifts and Portable Aerial Work Platforms Dingli, Haulotte and Oshkosh (JLG) Boom Lifts Dingli, Haulotte, JCB, Linamar (Skyjack), Manitou, MEC, Oshkosh (JLG), Sinoboom, XCMG and Zoomlion Scissor Lifts Dingli, Haulotte, JCB, LGMG, Linamar (Skyjack), MEC, Oshkosh (JLG), Sinoboom, XCMG and Zoomlion Utility Equipment Altec, Dur-A-Lift, Elliot Equipment, Palfinger, Posi+ and Time Manufacturing Telehandlers JCB, Linamar (Skyjack), Manitou (Gehl), Merlo and Oshkosh (JLG) Environmental Solutions Group Refuse Collection Bodies Labrie, New Way, Oshkosh (McNeilus) Compactors and Balers Cram-A-Lot, Komar, Wastebuilt On Board Vehicle Technology AMCS, Geotab, Ltyx, Routeware, Samsara 12 MAJOR CUSTOMERS None of our customers individually accounted for more than 10% of our consolidated net sales in 2024.
We encourage, value, and support team members of every race, gender, age, ability, religion, orientation, identity, and experience. We firmly believe that diversity of background, thought, and experience cultivates innovation and better decision-making. Our culture is defined by our Terex Way Values – Integrity, Respect, Improvement, Servant Leadership, Courage, and Citizenship.
We encourage, value, and support team members of every race, gender, age, ability, religion, orientation, identity, and experience. We firmly believe that different backgrounds, thoughts, and experiences cultivate innovation and better decision-making. Our culture is defined by our Terex Way Values – Integrity, Respect, Improvement, Servant Leadership, Courage, and Citizenship.
We are also committed to creating a culture of inclusion, which starts with the tangible, intentional actions that all Terex team members – regardless of title or tenure - must make to ensure our team members feel safe, supported, and valued.
We are committed to creating a culture of inclusion, which starts with the tangible, intentional actions that all Terex team members – regardless of title or tenure - must make to ensure our team members feel safe, supported, and valued. AVAILABLE INFORMATION We maintain a website at www.terex.com.
Terex has set the goals of reaching a 0.4 lost time injury rate and 1.4 total recordable injury rate by the end of 2026. At the end of 2023, our lost time injury rate was 0.58 and our total recordable injury rate was 1.98.
Terex has set the goals of reaching a 0.4 lost time injury rate and 1.4 total recordable injury rate by the end of 2026. At the end of 2024, our lost time injury rate was 0.37 and our total recordable injury rate was 1.49.
We have a parts and logistics center located in North Bend, Washington for our AWP products. Additionally, a portion of our aerial and utility products parts business is conducted at a shared Terex facility in Southaven, Mississippi. Our European, Asian Pacific and Latin American parts and logistics operations are conducted through a combination of outsourced facilities and Terex managed operations.
We have a parts and logistics center located in North Bend, Washington for our AWP products. Additionally, we have a parts distribution center in Southaven, Mississippi. Our European, Asian Pacific and Latin American parts and logistics operations are conducted through a combination of outsourced facilities and Terex managed operations.
The “Grow” theme is the outcome of doing “Execute” and “Innovate” well. We will successfully and profitably grow when we operate efficiently, apply new thinking in creating value for customers and take on new challenges through business investments (i.e. new category and geographic development). We also see a role for further growth via inorganic investments.
We will successfully and profitably grow when we operate efficiently, apply new thinking in creating value for customers and take on new challenges through business investments (i.e. new category and geographic development). We also see a role for further growth via inorganic investments.
Safety remained the highest rated survey category and we received positive net promoter scores. 13 We have a robust talent review process in which we assess talent strengths and opportunity areas, matching our team members’ career aspirations with the needs of the business.
In 2024, 88% of team members participated in our company-wide global engagement survey. Safety remained the highest rated survey category and we received positive net promoter scores. 14 We have a robust talent review process in which we assess talent strengths and opportunity areas, matching our team members’ career aspirations with the needs of the business.
Currently, we are engaged in various legal proceedings with respect to intellectual property rights. While the outcome of these matters cannot be predicted with certainty, we believe the outcome of such matters will not have a material adverse effect, individually or in aggregate, on our business or operating performance. For more detail, see Item 3 – “Legal Proceedings”.
While the outcome of these matters cannot be predicted with certainty, we believe the outcome of such matters will not have a material adverse effect, individually or in aggregate, on our business or operating performance. For more detail, see Item 3 – “Legal Proceedings”.
UTILITY EQUIPMENT. Our utility products include digger derricks and insulated aerial devices.
UTILITY EQUIPMENT. Our utility products include digger derricks, insulated aerial devices and self-propelled articulating insulated booms.
BACKLOG Our backlog as of December 31, 2023 and 2022 was as follows (in millions): December 31, 2023 2022 MP $ 767.5 $ 1,174.3 AWP 2,643.6 2,896.6 Total $ 3,411.1 $ 4,070.9 We define backlog as firm orders that are expected to be filled, including orders that are expected to be filled beyond one year, although there can be no assurance that all such backlog orders will be filled.
BACKLOG Our backlog as of December 31, 2024 and 2023 was as follows (in millions): December 31, 2024 2023 MP $ 320 $ 767 AWP 1,451 2,644 ESG 520 — Total $ 2,291 $ 3,411 We define backlog as firm orders that are expected to be filled, including orders that are expected to be filled beyond one year, although there can be no assurance that all such backlog orders will be filled.
Conveyors are mechanical machines used to transport and stockpile materials such as aggregates and minerals after processing. 7 SPECIALTY EQUIPMENT.
We manufacture a range of conveyors which include tracked and wheeled mobile conveyors. Conveyors are mechanical machines used to transport and stockpile materials such as aggregates and minerals after processing. 7 SPECIALTY EQUIPMENT.
Successful pursuit of the “Execute, Innovate, Grow” strategy will shape the direction of our Company over the coming years. Terex is a diverse company that works collaboratively to deliver business performance efficiently and effectively.
Successful pursuit of the “Execute, Innovate, Grow” strategy will shape the direction of our Company over the coming years. Terex has a diverse portfolio of businesses that work collaboratively to deliver business performance efficiently and effectively. We balance the independence of our businesses with the benefits of total Company scale, which is central to how we manage our Company.
Today, Terex is a global manufacturer of materials processing machinery and aerial work platforms. We design, build and support products used in maintenance, manufacturing, energy, recycling, minerals and materials management, and construction applications.
Today, Terex is a global industrial equipment manufacturer of materials processing machinery, waste and recycling solutions, mobile elevating work platforms (MEWPs), and equipment for the electric utility industry. We design, build and support products used in maintenance, manufacturing, energy, waste and recycling, minerals and materials management, construction, and the entertainment industry.
Our aspirational goal will always be zero injuries, but these goals represent milestones along our journey to Zero Harm. TEAM MEMBER TALENT AND SUPPORT Terex strives to attract, develop and retain outstanding talent to be part of our team. We have a diverse and highly engaged global workforce.
Our aspirational goal will always be zero injuries, but these goals represent milestones along our journey to Zero Harm. TEAM MEMBER TALENT AND SUPPORT Terex strives to attract, engage, develop and retain outstanding talent to be part of our team. Capable, highly skilled and engaged team members are key to our ability to implement our “Execute, Innovate, Grow” strategy.
Customer ROIC is a key focus of our organization and is central to our ability to generate returns for investors. 5 We operate our Company based on our value system, “The Terex Way”, which shapes the culture of our Company and reflects our collective commitment to and understanding of what it means to be a part of Terex.
We operate our Company based on our value system, “The Terex Way”, which shapes the culture of our Company and reflects our collective commitment to and understanding of what it means to be a part of Terex. The Terex Way is based on six key values: • Integrity : We do not sacrifice integrity for profit.
In parallel to this, we continue to research and evaluate alternative lower and no-carbon energy alternatives, including partnering with technology companies and universities, that may become viable solutions for our products in the future. Approximately 70% of MP and Genie products offer electric and/or hybrid options. Product innovation has become a core element of our growth strategy.
In parallel to this, we continue to research and evaluate alternative lower and no-carbon energy alternatives, including partnering with technology companies and universities, that may become viable solutions for our products in the future.
We have many patents that we use in connection with our operations and most of our products contain some proprietary technology. Many of these patents and related proprietary technology are important to the production of particular products; however, overall, our patents, taken together, are not material to our business or our overall financial results.
Many of these patents and related proprietary technology are important to the production of particular products; however, overall, our patents, taken together, are not material to our business or our overall financial results. Currently, we are engaged in various legal proceedings with respect to intellectual property rights.
We have taken a lead on many of these developments within the industries we serve, and we will continue to evolve our approach to alternative, environmentally friendly equipment power as technical capabilities advance, solution economics improve, and customer demand for these solutions continues to increase. 12 Increasingly stringent laws and regulations dealing with the environmental aspects of the products we manufacture can result in significant expenditures in designing and manufacturing new forms of equipment that satisfy such new laws and regulations.
We have taken a lead on many of these developments within the industries we serve, and we will continue to evolve our approach to alternative, environmentally friendly equipment power as technical capabilities advance, solution economics improve, and customer demand for these solutions continues to increase.
AERIAL WORK PLATFORMS Our AWP segment designs, manufactures, services and markets aerial work platform equipment, utility equipment and telehandlers. Products include portable material lifts, portable aerial work platforms, trailer-mounted articulating booms, self-propelled articulating and telescopic booms, scissor lifts, utility equipment (including digger derricks and insulated aerial devices) and telehandlers, as well as their related components and replacement parts.
Products include portable material lifts, portable aerial work platforms, trailer-mounted articulating booms, self-propelled articulating and telescopic booms, scissor lifts, utility equipment (including digger derricks and insulated aerial devices) and telehandlers, as well as their related components and replacement parts. Aerial work platform equipment positions workers and materials easily and quickly to elevated work areas, enhancing safety and productivity at height.
This equipment is used in, among other things, recycling, wood energy, green waste/construction, demolition recycling industries and pulp and paper. Robotic waste sorting equipment consists of smart robots, powered by AI software, designed to pick, sort and recycle waste. We manufacture a range of conveyors which include tracked and wheeled mobile conveyors.
This equipment is used in, among other things, recycling, wood energy, green waste/construction, demolition recycling industries and pulp and paper. Robotic waste sorting equipment consists of smart robots, powered by AI software, designed to pick, sort and recycle waste. Tree care and vegetation management equipment includes chippers, mulchers, spider lifts and dedicated tree care handlers.
We also provide service and support for aerial and utility products in the U.S. through a network of service branches and field service operations. OTHER We may assist customers in their rental, leasing and acquisition of our products through Terex Financial Services (“TFS”).
We also provide service and support for aerial and utility products in the U.S. through a network of service branches and field service operations.
Because many variables can cause changes in backlog and these changes may or may not be of any significance, we consequently view backlog as an important, but not necessarily determinative, indicator of future results. Our overall backlog amounts at December 31, 2023 decreased $659.8 million from our backlog amounts at December 31, 2022, driven by improved customer deliveries.
Because many variables can cause changes in backlog and these changes may or may not be of any significance, we consequently view backlog as an important, but not necessarily determinative, indicator of future results.
Backlog is still significantly above historical levels. MP segment backlog at December 31, 2023 decreased approximately 35% from our backlog amounts at December 31, 2022. The decrease from 2022 was driven primarily by improved customer deliveries and lower bookings across our MP businesses as lead times decrease and MP backlog begins returning to historical levels.
The decrease from 2023 was driven primarily by improved customer deliveries and a return to historical ordering patterns across our MP businesses as lead times decreased. AWP backlog at December 31, 2024 decreased approximately 45% from backlog amounts at December 31, 2023.
We expect our businesses to deploy processes that meet local needs while delivering a level of performance and predictability that is consistent with effective operations. These expectations are fulfilled differently by the various Terex businesses, but the core principles are the same.
These core operating processes are being developed into the newly created Terex Operating System, as we migrate towards an integrated operating company. We expect our businesses to deploy processes that meet local needs while delivering a level of performance and predictability that is consistent with effective operations.
We employ sales representatives who service these channel partners from offices located throughout the world. Our utility products are distributed to the utility and municipal markets and contractors in North America principally through a network of rental companies, independent distributors and a direct sales model.
AERIAL WORK PLATFORMS Our aerial work platform and telehandler products are distributed principally through a global network of rental companies and independent distributors. Our utility products are distributed to the utility and municipal markets and contractors in North America principally through a network of rental companies, independent distributors and a direct sales model.
TFS monitors directly or uses third-party appraisal companies to provide a basis to project future values of Terex used equipment in the secondary market sales channels. These secondary market sales channels may also be used for re-marketing any equipment which is returned at end of lease, or is repossessed in the case of a customer default.
These secondary market sales channels may also be used for re-marketing any equipment which is returned at end of lease or is repossessed in the case of a customer default. If equipment is received, TFS uses the resale channel which maximizes proceeds and/or mitigates risk for Terex and our funding partners.
We have also focused on producing more cost-effective product solutions across product families, as well as increasing commonalities of components to ease manufacturing processes.
Robust product development pipelines are in place, which we expect will continue to bring new, differentiated products to the market in the years ahead. We have also focused on producing more cost-effective product solutions across product families, as well as increasing commonalities of components to ease manufacturing processes.
TFS uses its equipment financing experience to facilitate financial products and services to assist customers in the acquisition of our equipment. On a global basis, TFS facilitates financing transactions directly between (i) end-user customers, distributors and rental companies and (ii) third-party financial institutions, providing recourse in certain circumstances.
On a global basis, TFS facilitates financing transactions directly between (i) end-user customers, distributors and rental companies and (ii) third-party financial institutions, providing recourse in certain circumstances. Most of the transactions are fixed and floating rate loans; however, TFS also facilitates sales-type leases, operating leases and rentals.
If equipment is received, TFS uses the resale channel which maximizes proceeds and/or mitigates risk for Terex and our funding partners. BUSINESS STRATEGY Terex is a manufacturer of specialized capital equipment and related services. Our goal is to design, manufacture and market equipment and services that provide superior life-cycle return on invested capital to our customers (“Customer ROIC”).
BUSINESS STRATEGY Terex is a manufacturer of specialized capital equipment and related services. Our goal is to design, manufacture and market equipment and services that provide superior life-cycle return on invested capital to our customers (“Customer ROIC”). Customer ROIC is a key focus of our organization and is central to our ability to generate returns for investors.
Seasonality is a factor in some businesses, where annual purchasing patterns are impacted by the seasonality of downstream project spending. Specifically, our businesses can experience stronger demand during the second quarter, as customers in the northern hemisphere make investments in time for the annual construction season (April to October).
Specifically, our businesses can experience stronger demand during the second quarter, as customers in the northern hemisphere make investments in time for the annual construction season (April to October). Non-seasonal macro factors are also important and can surpass seasonal influences in importance in some years.
Continually monitoring our materials, manufacturing and engineering costs is essential to identifying possible savings, enabling us to leverage those savings to improve our competitiveness and our Customer ROIC.
In addition, our engineering center in India supports our engineering teams worldwide through new product design, existing product design improvement and development of products for local markets. Continually monitoring our materials, manufacturing and engineering costs is essential to identifying possible savings, enabling us to leverage those savings to improve our competitiveness and our Customer ROIC.
In 2023, our largest customer accounted for less than 5% of our consolidated net sales and our top ten customers in the aggregate accounted for less than 27% of our consolidated net sales.
In 2024, our largest customer accounted for less than 6% of our consolidated net sales and our top ten customers in the aggregate accounted for less than 29% of our consolidated net sales. A material portion of AWP and ESG net sales are to national rental companies.
We continue to build and actively pursue our inorganic investment pipeline, with an eye towards adding new dimensions to the Company portfolio and applying our skills as a manager of specialized machinery businesses in new and complementary domains.
We continue to build and actively pursue our inorganic investment pipeline, with an eye towards adding new dimensions to the Company portfolio and applying our skills as a manager of specialized machinery businesses in new and complementary domains. 6 Our capital allocation approach remains an important part of our overall strategy, including maintenance of an optimal capital structure (2.5x net leverage target through the cycle), growth investments, restructuring investments and efficient return of capital to stockholders via dividends and share repurchases.
We generally consider our relations with our team members to be good and we provide mechanisms such as surveys and helplines for our team members to provide their perspectives. In 2023, 89% of team members participated in our company-wide global engagement survey.
The provisions of these agreements correspond in each case with the required or customary terms in the subject jurisdiction. We generally consider our relations with our team members to be good and we provide mechanisms such as surveys and helplines for our team members to provide their perspectives.
Our materials processing equipment includes crushers, screens, trommels and feeders, washing systems and conveyors as well as wood and biomass chippers and grinders.
PRODUCTS MATERIALS PROCESSING MATERIALS PROCESSING EQUIPMENT. Materials processing equipment is used in processing aggregate materials for building applications and is also used in the quarrying, mining, construction, demolition, recycling, landscaping and biomass production industries. Our materials processing equipment includes crushers, screens, trommels and feeders, washing systems and conveyors as well as wood and biomass chippers and grinders.
A material portion of AWP net sales is to national rental companies. 11 PATENTS, LICENSES AND TRADEMARKS We use proprietary materials such as patents, trademarks, trade secrets and trade names in our operations and take actions to protect these rights.
PATENTS, LICENSES AND TRADEMARKS We use proprietary materials such as patents, trademarks, trade secrets and trade names in our operations and take actions to protect these rights. We use several significant trademarks and trade names, most notably the Terex ® , Genie ® , Powerscreen ® , Fuchs ® and Heil ® trademarks.
Our values are the driving force behind our commitment to maintain an inclusive, supportive, equitable, and safe workplace for all team members. We know that diversity alone is not sufficient. We strive to be fair and impartial in our decisions, ensuring equity within our workplace.
Our values are the driving force behind our commitment to maintain an inclusive, supportive, non-discriminatory, and safe workplace for all team members.
We use several significant trademarks and trade names, most notably the Terex ® , Genie ® , Powerscreen ® and Fuchs ® trademarks. The other trademarks and trade names that we use include registered trademarks of Terex Corporation or its subsidiaries.
The other trademarks and trade names that we use include registered trademarks of Terex Corporation or its subsidiaries. We have many patents that we use in connection with our operations and most of our products contain some proprietary technology.
Compliance with laws and regulations regarding safety and the environment has required, and will continue to require, us to make expenditures. We currently do not expect that these expenditures will have a material adverse effect on our business or results of operations. SEASONAL FACTORS Terex is a globally diverse company, supporting multiple end uses.
We currently do not expect that these expenditures will have a material adverse effect on our business or results of operations. SEASONAL FACTORS Terex is a global company, with a diverse portfolio of businesses that support multiple end uses. Seasonality is a factor in some businesses, where annual purchasing patterns are impacted by the seasonality of downstream project spending.
WORKING CAPITAL Our businesses are working capital intensive and require funding to purchase production and replacement parts inventories and expenditures to repair, replace and upgrade existing facilities. We have debt service requirements, including periodic interest payments on our outstanding debt.
In 2025, we expect second half sales to be higher than first half sales, with the second, third and fourth quarter sales higher than first quarter sales. WORKING CAPITAL Our businesses are working capital intensive and require funding to purchase production and replacement parts, inventories and expenditures to repair, replace and upgrade existing facilities.
Outside of North America, independent distributors sell our utility equipment directly to customers. 9 RESEARCH, DEVELOPMENT AND ENGINEERING We maintain engineering staff at our manufacturing locations to conduct research, development and engineering for site-specific products. We have also established competency centers that support entire segments from single locations in certain fields such as control systems.
Outside of North America, independent distributors sell our utility equipment directly to customers. ENVIRONMENTAL SOLUTIONS GROUP We distribute our ESG products to customers through several channels including a network of independent distributors, direct sales and rental companies. RESEARCH, DEVELOPMENT AND ENGINEERING We maintain engineering staff at our manufacturing locations to conduct research, development and engineering for site-specific products.
Most of the transactions are fixed and floating rate loans; however, TFS also facilitates sales-type leases, operating leases and rentals. In addition, wholesale financing may be arranged between dealers and distributors who sell our equipment and financial institutions with which TFS has established relationships.
In addition, wholesale financing may be arranged between dealers and distributors who sell our equipment and financial institutions with which TFS has established relationships. 5 TFS uses third-party appraisal companies to provide a basis to project future values of Terex used equipment in the secondary market sales channels.
Outside of the U.S., we enter into employment contracts and collective agreements in those countries in which such relationships are mandatory or customary. The provisions of these agreements correspond in each case with the required or customary terms in the subject jurisdiction.
As of December 31, 2024, we had approximately 11,400 team members, including approximately 5,800 team members in the U.S. Approximately one percent of our team members in the U.S. are represented by labor unions. Outside of the U.S., we enter into employment contracts and collective agreements in those countries in which such relationships are mandatory or customary.
Our businesses assess global trends to understand future needs of our customers and help us decide which technologies to implement in future development projects. In addition, our engineering center in India supports our engineering teams worldwide through new product design, existing product design improvement and development of products for local markets.
We have also established competency centers that support entire segments from single locations in certain fields such as control systems. Our businesses assess global trends to understand future needs of our customers and help us decide which technologies to implement in future development projects.
Removed
Aerial work platform equipment positions workers and materials easily and quickly to elevated work areas, enhancing safety and productivity at height.
Added
We provide lifecycle support to our customers through our global parts and services organization, and offer complementary digital solutions, designed to help our customers maximize their return on their investment.
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The Terex Way is based on six key values: • Integrity : We do not sacrifice integrity for profit. We are transparent in all our business dealings.
Added
We have North American distribution centers in Louisville, Kentucky and Southaven, Mississippi, service centers in Australia, Thailand, Turkey, Malaysia and a parts distribution center in Northern Ireland. AERIAL WORK PLATFORMS Our AWP segment designs, manufactures, services and markets aerial work platform equipment, utility equipment and telehandlers.
Removed
For example, our Genie business is managed to a defined set of processes that we call the Genie Operating System. Our Materials Processing segment is managed to a similar set of processes that we call the MP Operating System. Both are key to delivering excellence across all functions within our operations.
Added
ENVIRONMENTAL SOLUTIONS GROUP Our ESG segment designs, manufactures, services and markets waste and recycling equipment and solutions, including refuse collection bodies, hydraulic cart lifters, automated carry cans, compaction, balers and recycling equipment, cameras with integrated smart technology, as well as related components and replacement parts, and waste hauler software solutions.
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We feel that managing this way is key to appropriately balancing consistency and autonomy in our Company. Process discipline is important to efficient operation, but local control is important to the effectiveness with which business processes are implemented.
Added
Customers use these products in the solid waste and recycling industry. We market our ESG products principally under the following brand names: Heil ® , Marathon ® , 3rd Eye ® , Soft-Pak ® , Connected Collections ® , Parts Central ® , Curotto-Can ® and Bayne Thinline ® .
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Digitalization plays an important role in many of the innovations we pursue, but there are other aspects of this strategy that involve non-digital changes to the design of our products and improved ways of doing things. For example, we provide product solutions to help our customers achieve sustainability goals including electric and/or hybrid options.
Added
ESG has the following significant manufacturing operations: • Refuse collection bodies, hydraulic cart lifters and automated carry cans are manufactured in Fort Payne, Alabama; and • Compaction, balers and recycling equipment are manufactured in Vernon, Alabama. We have a parts distribution center and various warehouses located in Fort Payne, Alabama.
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Over the past three years, we have completed multiple transactions, adding scope and depth to our Company through acquisitions of new facilities and businesses and investments in companies.
Added
OTHER We may assist customers in their rental, leasing and acquisition of our 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 our equipment.
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Our Disciplined Capital Allocation approach remains an important part of our overall strategy, including maintenance of an optimal capital structure (of approximately 2.5 average net debt to EBITDA over the cycle), growth investments, restructuring investments and efficient return of capital to stockholders via dividends and share repurchases.
Added
These expectations are fulfilled differently by the various Terex businesses, but the core principles are the same as outlined in the Terex Operating System.
Removed
We balance the independence of our businesses with the benefits of total Company scale, which is central to how we manage our Company. 6 PRODUCTS MATERIALS PROCESSING MATERIALS PROCESSING EQUIPMENT. Materials processing equipment is used in processing aggregate materials for building applications and is also used in the quarrying, mining, construction, demolition, recycling, landscaping and biomass production industries.
Added
The Terex Operating System is being designed to ensure strict process discipline, continuous improvement, and automation is deployed wherever Terex-wide standardization can add value, while still allowing our businesses the flexibility to modify for their individual market needs.
Removed
AWP segment backlog at December 31, 2023 decreased approximately 9% from our backlog amounts at December 31, 2022. The decrease from 2022 was primarily driven by improved customer deliveries while bookings remain strong, primarily in North America.
Added
Digital transformation plays an important role in many of the innovations we pursue, and it spans fully across our enterprise systems, factory operations, and product solutions. The “Grow” theme is the outcome of doing “Execute” and “Innovate” well.
Removed
We have re-invigorated and increased our emphasis on creating new models and meeting the demands of our customers. Robust product development pipelines are in place, which we expect will continue to bring new, differentiated products to the market in the years ahead.
Added
Our most recent acquisition of the ESG from Dover Corporation demonstrates our commitment to adding attractive businesses in non-cyclical markets with a keen focus on the waste management, recycling, and circular economy segments.
Removed
Non-seasonal macro factors are also important and can surpass seasonal influences in importance in some years. In 2024, we expect first and second half sales to be comparable to each other, with the second and third quarter sales modestly higher than first and fourth quarter sales.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe risks associated with integrating acquired businesses include: • the business culture of the acquired business may not match well with our culture; • technological and product synergies, economies of scale and cost reductions may not occur as expected; • we may acquire or assume unexpected liabilities; • faulty assumptions may be made regarding the acquisition and integration process; • unforeseen difficulties may arise in integrating operations and systems; • we may fail to attract, retain, motivate and integrate key management and other employees of the acquired business; • we may experience problems in retaining customers; and • a large acquisition could stretch our resources and divert management’s attention from the existing operations.
Biggest changeThe risks associated with the ESG acquisition and our other past or future acquisitions include: • the business culture of the acquired business may not match well with our culture; • we may acquire or assume unexpected liabilities; • faulty assumptions may be made regarding the integration process; • unforeseen difficulties may arise in integrating operations and systems; • we may fail to retain, motivate and integrate key management and other employees of the acquired business; • higher than expected finance costs may arise due to unforeseen changes in tax, trade, environmental, labor, safety, payroll or pension policies in any jurisdiction in which the acquired business conducts its operations; • we may experience problems in retaining customers and integrating customer bases; and • a large acquisition could stretch our resources and divert management’s attention from existing operations.
However, we cannot assure you that our policies, procedures and programs always will protect us from reckless or criminal acts committed by our employees or third parties that transact Terex business. We have a zero-tolerance policy for violations of anti-corruption laws and our anti-corruption policy.
However, we cannot assure you that our policies, procedures and programs will always protect us from reckless or criminal acts committed by our employees or third parties that transact Terex business. We have a zero-tolerance policy for violations of anti-corruption laws and our anti-corruption policy.
Although we have a compliance program in place designed to reduce the likelihood of potential violations of such laws, violations of anti-corruption laws could result in significant fines, criminal sanctions against us or our employees, prohibitions on the conduct of our business including our business with the U.S. government, an adverse effect on our reputation, business and results of operations and financial condition and a violation of our injunction or cease and desist order with the SEC.
Although we have a compliance program in place designed to reduce the likelihood of potential violations of such laws, violations of anti-corruption laws could occur and could result in significant fines, criminal sanctions against us or our employees, prohibitions on the conduct of our business including our business with the U.S. government, an adverse effect on our reputation, business, results of operations and financial condition and a violation of our injunction or cease and desist order with the SEC.
If we fail to attract, hire, train, develop, engage, motivate and retain qualified personnel, or if we experience prolonged excessive turnover, we may experience declining sales, manufacturing delays, the loss of knowledge of departing employees or other inefficiencies, increased recruiting, hiring, onboarding and training resources, relocation costs and other difficulties, and our business, financial condition, results of operations and cash flows could be materially and adversely affected.
If we fail to attract, hire, train, develop, engage, motivate and retain qualified personnel, or if we experience prolonged excessive turnover, we may experience declining sales, manufacturing delays, the loss of knowledge of departing employees or other inefficiencies, increased recruiting, hiring, onboarding and training resources, relocation costs and 24 other difficulties, and our business, financial condition, results of operations and cash flows could be materially and adversely affected.
Delays in obtaining supplies may result from a number of factors affecting our suppliers, including capacity constraints, regulatory changes, global logistics network challenges and cost increases, labor shortages and disputes, wage increases, rising inflation, suppliers’ impaired financial condition, suppliers’ allocations to other purchasers, weather emergencies, pandemics or acts of war or terrorism.
Delays in obtaining supplies may result from a number of factors affecting our suppliers, including capacity constraints, regulatory changes, global logistics network challenges and cost increases, labor shortages and disputes, wage increases, inflation, suppliers’ impaired financial condition, suppliers’ allocations to other purchasers, weather emergencies, pandemics or acts of war or terrorism.
Certain of our assets, liabilities, expenses, revenues and earnings are denominated in other countries’ currencies, including the Euro, British Pound, Chinese Yuan, Indian Rupee, Australian Dollar and Mexican Peso. Those assets, liabilities, expenses, revenues and earnings are translated into U.S. dollars at the applicable foreign exchange rates to prepare our consolidated financial statements.
Certain of our assets, liabilities, expenses, revenues and earnings are denominated in other countries’ currencies, including the Euro, British Pound, 17 Chinese Yuan, Indian Rupee, Australian Dollar and Mexican Peso. Those assets, liabilities, expenses, revenues and earnings are translated into U.S. dollars at the applicable foreign exchange rates to prepare our consolidated financial statements.
In addition, any 16 actual or perceived defect or quality issue in our products could lead to negative public perceptions about the safety of our products and could cause harm to our overall business, reputation, financial condition and operating results. A material disruption to one of our significant manufacturing plants could adversely affect our ability to generate revenue.
In addition, any actual or perceived defect or quality issue in our products could lead to negative public perceptions about the safety of our products and could cause harm to our overall business, reputation, financial condition and operating results. A material disruption to one of our significant manufacturing plants could adversely affect our ability to generate revenue.
If operations at a significant facility were disrupted as a result of equipment failures, natural disasters, health epidemics, work stoppages, power outages or other reasons, our business, financial conditions and results of operations could be adversely affected. Interruptions in production could increase costs and delay delivery of units in production.
If operations at a significant facility were disrupted as a result of equipment failures, natural disasters, health epidemics, work stoppages, power outages or other reasons, our business, financial conditions and results of operations could be adversely affected. Interruptions in production could increase costs and delay the delivery of units in production.
Our ability to match new product offerings to diverse global customers’ anticipated preferences for different types and sizes of equipment and various equipment features and functionality, at affordable prices, is critical to our success. This requires a thorough understanding of our existing and potential customers on a global basis.
Our ability to predict and match new product offerings to diverse global customers’ anticipated preferences for different types and sizes of equipment and various equipment features and functionality, at affordable prices, is critical to our success. This requires a thorough understanding of our existing and potential customers on a global basis.
Like other global companies, we have experienced cyber threats and incidents in our systems and those of our 20 third-party providers, and we have experienced viruses and attacks targeting our information technology systems and networks, although none have had a material adverse effect on our business or financial condition.
Like other global companies, we have experienced cyber threats and incidents in our systems and those of our third-party providers, and we have experienced viruses and attacks targeting our information technology systems and networks, although none have had a material adverse effect on our business or financial condition.
Our level of debt and the financial and restrictive covenants contained in our credit agreement could have important consequences on our financial position and results of operations, including increasing our vulnerability to increases in interest rates because debt under our credit agreement bears interest at variable rates.
Our increased level of debt and the financial and restrictive covenants contained in our credit agreement could have important consequences on our financial position and results of operations, including increasing our vulnerability to increases in interest rates because debt under our credit agreement bears interest at variable rates.
If this trend in customer and supplier consolidation continues, it could have an unfavorable impact on our pricing and product margins. Our business may suffer if our equipment fails to perform as expected.
If this trend in customer and supplier consolidation continues, it could have an unfavorable impact on our pricing and product margins. 21 Our business may suffer if our equipment fails to perform as expected.
Any delay or disruptions in receiving supplies have resulted and could further result in manufacturing inefficiencies caused by us having to wait for parts to arrive on production lines, could impair our ability to deliver products to our customers and delay sales, and, accordingly, could have a material adverse effect on our business, results of operations, financial condition and/or cash flows.
Any delay or disruptions in receiving supplies could result in manufacturing inefficiencies caused by us having to wait for parts to arrive on production lines, could impair our ability to deliver products to our customers and delay sales, and, accordingly, could have a material adverse effect on our business, results of operations, financial condition and/or cash flows.
Although our cash flow coverage ratio was greater than 2.0 to 1.0 at the end of 2023, there can be no assurance this will continue to occur. Our access to debt financing at competitive risk-based interest rates is partly a function of our credit ratings.
Although our cash flow coverage ratio was greater than 2.0 to 1.0 at the end of 2024, there can be no assurance this will continue to occur. Our access to debt financing at competitive risk-based interest rates is partly a function of our credit ratings.
The last several years have been marked by geopolitical instability, including the conflict between Russia and Ukraine as well as Israel and Hamas, social concerns, supply chain and freight constraints, pandemic, labor shortages and wage increases, high inflation, high interest rates, foreign currency exchange volatility, and continuing concerns of possible recessions, all of which have increased ongoing economic uncertainty and instability in the global markets.
The last several years have been marked by geopolitical instability, including the conflict between Russia and Ukraine as well as Israel and Hamas, social concerns, supply chain and freight constraints, a pandemic, labor shortages and wage increases, high inflation, high interest rates, foreign currency exchange volatility, and recessions, all of which have increased ongoing economic uncertainty and instability in the global markets.
As a result, if we commit or aid or abet any future violations of the anti-fraud, books and records, reporting and internal control provisions of the federal securities laws and related SEC rules, we are likely to suffer severe penalties, financial and otherwise, that could have a material negative impact on our business and results of operations. 23 ITEM 1B.
As a result, if we commit or aid or abet any future violations of the anti-fraud, books and records, reporting and internal control provisions of the federal securities laws and related SEC rules, we are likely to suffer severe penalties, financial and otherwise, that could have a material negative impact on our business and results of operations.
Such risks principally include: • uncertainties and instability in global and regional economic conditions, including changes related to market conditions caused by heightened inflation, potential economic recessions, and significant interest rate fluctuations; • ongoing political instability and uncertainties, including, but not limited to, the ongoing conflict between Russia and Ukraine, the conflict between Israel and Hamas, the relationship between China and the U.S. and other actual or anticipated military or political conflicts; • terrorist activities and the U.S. and international response thereto; • wage inflation, labor shortages and labor unrest; • trade protection measures and currency exchange controls; • changes in tax laws or interpretations, tax rates and tax legislation; • export duties and quotas; • domestic and foreign customs and tariffs; • current and changing regulatory environments; • difficulties protecting our intellectual property; • transportation delays and interruptions; • costs and difficulties in integrating, staffing and managing international operations, especially in developing markets such as China, India, Latin America, the Middle East and Africa; • difficulty in obtaining distribution support; • health epidemics or new pandemics; and • natural disasters.
Such risks principally include: • uncertainties and instability in global and regional economic conditions, including changes related to market conditions caused by heightened inflation, economic recessions, and significant interest rate fluctuations; • ongoing political instability and uncertainties, including, but not limited to, the ongoing conflict between Russia and Ukraine, the conflict between Israel and Hamas, the relationship between China and the U.S. and other actual or anticipated military or political conflicts; • domestic and foreign customs and tariffs; • export duties and quotas; • trade protection measures and currency exchange controls; • changes in tax laws or interpretations, tax rates and tax legislation; • current and changing regulatory environments; • terrorist activities and the U.S. and international response thereto; • wage inflation, labor shortages and labor unrest; • difficulties protecting our intellectual property; • transportation delays and interruptions; • costs and difficulties in integrating, staffing and managing international operations, especially in developing markets; • difficulty in obtaining distribution support; • health epidemics or new pandemics; and • natural disasters.
However, if customers are unwilling to accept price increases in the Company’s products and the Company is unable to recover a substantial portion of increased costs from our suppliers, or through duty draw-back/exclusions, or otherwise offset the increased costs, then continued or increased fluctuations in costs of materials or inflation generally and continued supply chain challenges could have a material adverse effect on the Company’s results of operation, profitability, free cash flows, and financial condition.
However, if customers become unwilling to accept any future price increases in the Company’s products and the Company is unable to recover a substantial portion of increased costs from our suppliers, or through duty draw-back/exclusions, or otherwise offset the increased costs, then increased fluctuations in costs of materials or inflation generally and supply chain challenges could have a material adverse effect on the Company’s results of operation, profitability, free cash flows, and financial condition.
The indirect impact of inflationary pressure on costs throughout the supply chain and the direct impact, for example, on costs for machines we import from our manufacturing operations in China, is leading to higher input costs and lower margins on certain products we sell.
The indirect impact of inflationary pressure on costs throughout the supply chain and the direct impact, for example, on costs for machines we import from our manufacturing operations in China, leads to higher input costs and lower margins on certain products we sell.
We continue to actively monitor and mitigate our supply chain risk, but there can be no assurance that our mitigation plans will be effective.
We actively monitor and mitigate our supply chain risk, but there can be no assurance that our mitigation plans will be effective.
The successful integration of any newly acquired business also requires us to implement effective internal control processes in these acquired businesses.
The successful integration of any previously acquired or newly acquired business also requires us to implement effective internal control processes in these acquired businesses.
The loss of the services of key employees or senior officers, or the inability to identify, hire, develop and retain other highly qualified personnel in the future, could adversely affect the quality and profitability of our business operations.
The loss of the services of key employees or senior officers, or the inability to identify, hire, develop and retain other highly qualified personnel for such roles in the future, could adversely affect the quality and profitability of our business operations.
Failing to comply with such covenants could result in an event of default that, if not cured or waived, could result in the acceleration of all our indebtedness or otherwise have a material adverse effect on our financial position, results of operations and debt service capability.
Our failure to comply with such covenants could result in an event of default that, if not cured or waived, could result in the acceleration of all our indebtedness or otherwise have a material adverse effect on our financial position, results of operation and debt service capability.
Our ability to maintain or expand our business depends on our ability to attract and hire qualified candidates with the requisite education, background, and experience as well as our ability to train, develop, engage, motivate and retain qualified team members with the skills necessary to understand and adapt to the continuously developing needs of our customers.
Additionally, our ability to maintain or expand our business depends on our ability to attract, hire, train, develop, engage, motivate and retain qualified team members with the requisite education, background, experience and skills necessary to understand and adapt to the continuously developing needs of our customers.
This could result in reduced demand for our products in the U.S. and have an adverse effect on our business or results of operations. Similarly, in 2023, the European Commission, began an anti-dumping investigation into imported mobile access equipment producers from China, following official complaint by several of our competitors.
This could result in reduced demand for our products in the U.S. and have an adverse effect on our business or results of operations. Similarly, following an official complaint by several of our EU competitors, the European Commission recently concluded an anti-dumping investigation into mobile access equipment imported from China.
We may be adversely impacted by work stoppages and other labor matters. As of December 31, 2023, we employed approximately 10,200 team members worldwide and approximately one percent of our team members in the U.S. are represented by labor unions.
We may be adversely impacted by work stoppages and other labor matters. As of December 31, 2024, we employed approximately 11,400 team members worldwide and approximately one percent of our team members in the U.S. are represented by labor unions.
Some of our customers have been unable to obtain the credit they need to buy our equipment. There can be no assurance third-party finance companies will continue to extend credit to our customers. 18 High interest rates could have a dampening effect on the financial condition of some of our customers and their ability to repay credit obligations.
There can be no assurance third-party finance companies will continue to extend credit to our customers. High interest rates could have a dampening effect on the financial condition of some of our customers and their ability to repay credit obligations.
We cannot ensure that any newly acquired companies will operate profitably, that the intended beneficial effect from these acquisitions will be realized and that we will not encounter difficulties in implementing effective internal control processes in these acquired businesses, particularly when the acquired business operates in foreign jurisdictions and/or was privately owned.
While we believe we have successfully integrated acquisitions to date, we cannot ensure that previously acquired or newly acquired companies, including ESG, will operate profitably, that the intended beneficial effect from these acquisitions will be realized and that we will not encounter difficulties in implementing effective internal control processes in these acquired businesses, particularly when the acquired business operates in foreign jurisdictions and/or was privately owned.
Increasing regulatory focus on privacy and data security issues and expanding laws could expose us to increased liability. The legislative and regulatory framework for privacy and data protection issues worldwide is rapidly evolving and is likely to continue to remain uncertain for the foreseeable future. We collect and transfer personal data as part of our business processes and activities.
Increasing regulatory focus on privacy and data security issues and expanding laws could expose us to increased liability. The legislative and regulatory framework for privacy and data protection issues worldwide continues to evolve. We collect and transfer personal data as part of our business processes and activities.
Compliance with environmental regulations could be costly and failure to meet sustainability expectations or standards or achieve our sustainability goals could adversely affect our reputation, business, results of operations, financial condition, or stock price. We generate hazardous and nonhazardous wastes in the normal course of our manufacturing operations.
Compliance with environmental regulations could be costly, and failure to meet sustainability requirements or expectations could adversely affect our reputation, business, results of operations, financial condition, or stock price. We generate hazardous and nonhazardous wastes in the normal course of our manufacturing operations. As a result, we are subject to a wide range of environmental laws and regulations.
Tariffs and the possibility of an escalation or further developments of current trade conflicts, particularly between the U.S. and China, could continue to negatively impact global trade and economic conditions in many of the regions where we do business.
As a global manufacturer, quotas, duties, tariffs and the possibility of an escalation or further developments of current trade conflicts could continue to negatively impact global trade and economic conditions in many of the regions where we do business.
If we are unable to continue to improve existing equipment products and technologies that meet our customers’ expectations, or the industry’s expectations, including, but not limited to electrification options discussed below, the demand for our equipment could be substantially adversely affected.
If we are unable to continue to improve existing equipment products and technologies that meet our customers’ expectations, or the industry’s expectations, including, but not limited to more electric powered and lower emission products, the demand for our equipment could be substantially adversely impacted.
Any failure, or perceived failure (whether or not valid), to act responsibly with respect to the environment, to achieve our sustainability goals, to maintain sustainability practices, to comply with emerging sustainability regulations, or to meet investor or customer expectations related to sustainability concerns, could harm our reputation, adversely impact our ability to attract and retain qualified and talented team members and customers, expose us to increased scrutiny from the investment community and enforcement authorities, reduce our stock price, have an adverse effect on our future financial results and cause harm to our business.
A failure, or perceived failure (whether or not valid), to act responsibly with respect to the environment, achieve our sustainability goals, maintain 23 sustainability practices, comply with sustainability regulations, or meet expectations related to sustainability concerns, could harm our reputation, adversely impact our ability to attract and retain customers and qualified and talented team members, have an adverse effect on our future financial results or cause harm to our business.
While we have seen improvements in certain areas of the supply chain, it is still not operating at optimal levels and additional fluctuations and disruptions are possible due to demand changes, inflation, geopolitical and economic uncertainty, regulatory and policy instability, the imposition of duties and tariffs (including on certain Chinese origin goods) and trade agreements/barriers, freight availability and costs, wage increases and labor shortages.
While we have seen improvements in the supply chain, additional fluctuations and disruptions are possible due to demand changes, inflation, geopolitical and economic uncertainty, regulatory and policy instability, the imposition of duties and tariffs and trade agreements/barriers, freight availability and costs, wage increases and labor shortages.
As a result, we are subject to a wide range of environmental laws and regulations. These laws and regulations govern actions that may have adverse environmental effects and require compliance with certain practices when handling and disposing of hazardous and nonhazardous wastes.
These laws and regulations govern actions that may have adverse environmental effects and require compliance with certain practices when handling and disposing of hazardous and nonhazardous wastes.
We obtain insurance coverage for catastrophic losses as well as those risks where insurance is required by law or contract. We do not believe that the outcome of such matters will have a material adverse effect on our consolidated financial position; however, any significant liabilities not covered by insurance could have an adverse effect on our financial condition.
We do not believe that the outcome of such matters will have a material adverse effect on our consolidated financial position; however, any significant liabilities not covered by insurance could have an adverse effect on our financial condition.
For example, tariffs on certain Chinese origin goods impact the cost of material and machines we import directly from our manufacturing operations in China, as well as the cost of material and components imported on our behalf by suppliers.
Such changes can make it difficult or costly for us to do business in, or import our products from, those countries. For example, tariffs on certain Chinese origin goods impact the cost of material and machines we import directly from our manufacturing operations in China, as well as the cost of material and components imported on our behalf by suppliers.
Competition and Strategic Performance Risks The industry in which we operate is highly competitive and subject to pricing pressure; if we fail to compete effectively, both in product offerings and price, demand for our products may decrease and our business could suffer. Our industry is highly competitive.
The industry in which we operate is highly competitive and subject to pricing pressure; if we fail to compete effectively, both in product offerings and price, demand for our products may decrease and our business could suffer. 19 Our industry is highly competitive. Our competitors include a variety of both domestic and foreign companies in all major markets.
If duties are not granted as a result of such investigation, or if any duties granted are not sufficient, it could result in reduced demand for our products in the E.U. and have an adverse effect on our business or results of operation.
If such duties are not enough to offset any subsidies provided by the Chinese government to Chinese manufacturers and/or if their duties are modified as a result of any appeal process, it could result in reduced demand for our products in the E.U. and have an adverse effect on our business or results of operation.
Our information security efforts include programs designed to address security governance, identification and protection of critical assets, insider risk, third-party risk and cyber defense operations.
Our information security efforts include programs designed to address security governance, identification and protection of critical assets, insider risk, third-party risk and cyber defense operations. We are also utilizing artificial intelligence technologies to help detect and defend against cyber threats.
Such fluctuations in foreign exchange rates relative to the U.S. dollar may cause our actual results to differ materially from those anticipated in our guidance and have a material adverse effect on our business or results of operations. 17 We have a significant amount of debt outstanding and must comply with restrictive covenants in our debt agreements.
Such fluctuations in foreign exchange rates relative to the U.S. dollar may cause our actual results to differ materially from those anticipated in our guidance and have a material adverse effect on our business or results of operations. Some of our customers rely on financing with third parties to purchase our products.
Any new products that we develop may also not receive market acceptance or otherwise generate meaningful net sales or profits for us relative to our expectations and our investments.
Any new products that we develop may also not receive market acceptance or otherwise generate meaningful net sales or profits for us relative to our expectations and our investments. Failure to compete effectively could result in lower revenues from our products and services, lower gross margins or loss of market share.
An unexpected change in customer financial condition or future economic uncertainty could result in additional requirements for specific reserves, which could have a negative impact on our consolidated financial position.
An unexpected change in customer financial condition or future economic uncertainty could result in additional requirements for specific reserves, which could have a negative impact on our consolidated financial position. Competition and Strategic Performance Risks We may be unable to successfully integrate acquired businesses, including ESG.
We obtain materials and manufactured components from third-party suppliers. Principal materials and components used in our various manufacturing processes include steel, castings, engines, tires, hydraulics, cylinders, drive trains, electric controls and motors, semiconductors, and a variety of other commodities and fabricated or manufactured items.
Principal materials and components used in our various manufacturing processes include steel, castings, engines, tires, hydraulics, cylinders, drive trains, cab chassis, electric controls and motors, semiconductors, and a variety of other commodities and fabricated or manufactured items. The cost and availability of these materials, components and final assemblies have varied significantly in past years.
Modification to the design of our products to meet local requirements and preferences may take longer or be more costly than we anticipate and could have a material adverse effect on our ability to achieve international sales growth. 15 Changes in the availability and price of certain materials and components have resulted and could result in significant disruptions to the supply chain causing manufacturing inefficiencies, increased costs and lower profits.
Modification to the design of our products to meet local requirements and preferences may take longer or be more costly than we anticipate and could have a material adverse effect on our ability to achieve international sales growth.
If economic conditions in the U.S., Europe and other key markets do not show continued stability or improvement, we may experience negative impacts to our net sales, financial condition, profitability and cash flows, which could result in the need for us to record impairments.
If economic conditions in the U.S., Europe and other key markets weaken, we may experience further negative impacts to our net sales, financial condition, profitability and cash flows, which could result in the need for us to record impairments. We have a significant amount of debt outstanding and must comply with covenants in our debt agreements.
Our credit agreement and other debt agreements contain financial and restrictive covenants that may limit our ability to, among other things, borrow additional funds or take advantage of business opportunities. As of December 31, 2023, we are in compliance with the financial covenants.
In addition, our credit agreement contains financial and restrictive covenants that may limit our ability to, among other things, borrow additional funds or take advantage of business opportunities. While we are currently in compliance with the financial 16 covenants, increases in our debt or decreases in our earnings could cause us to fail to comply with these financial covenants.
Any decrease or delay in government funding of highway construction and maintenance, other infrastructure projects and overall government spending could cause our revenues and profits to decrease.
Any decrease or delay in government funding of highway construction and maintenance, other infrastructure projects and overall government spending could cause our revenues and profits to decrease. Recent channel adjustments reflect macro uncertainty, high interest rates, geopolitical uncertainties, and shorter delivery lead times.
Information Technology Risks Increased cybersecurity threats and more sophisticated computer crime may pose a risk to our systems, networks, products and services.
Production capacity limits could cause us to reduce or delay sales efforts until production capacity is available. Information Technology Risks Increased cybersecurity threats and more sophisticated computer crime may pose a risk to our systems, networks, products and services.
Some of our customers rely on financing with third parties to purchase our products. We rely on sales of our products to generate cash from operations. Significant portions of our sales are financed by third-party finance companies on behalf of our customers.
We rely on sales of our products to generate cash from operations. Significant portions of our sales are financed by third-party finance companies on behalf of our customers. The availability of financing by third parties is affected by general economic conditions, credit worthiness of our customers and estimated residual value of our equipment.
Our competitors include a variety of both domestic and foreign companies in all major markets. To compete successfully, our products must excel in terms of quality, reliability, durability, productivity, price, features, ease of use, safety and comfort, and we must provide excellent customer service and support.
To compete successfully, our products must excel in terms of quality, reliability, durability, productivity, price, features, ease of use, safety and comfort, and we must provide excellent customer service and support. The greater financial resources of certain of our competitors may put us at a competitive disadvantage.
Moreover, the constrained labor conditions and wage inflation pressures may mean that retention of existing talent may continue to require significant additional pay and incentives.
Efforts to attract talent to fill open roles with labor availability constraints and wage inflation can take more time and cost us significantly more. Moreover, constrained labor conditions and wage inflation pressures may mean that retention of existing talent may continue to require significant additional pay and incentives.
The availability of financing by third parties is affected by general economic conditions, credit worthiness of our customers and estimated residual value of our equipment. Deterioration in credit quality of our customers or estimated residual value of our equipment could negatively impact the ability of our customers to obtain resources they need to purchase our equipment.
Deterioration in credit quality of our customers or estimated residual value of our equipment could negatively impact the ability of our customers to obtain resources they need to purchase our equipment. Some of our customers have been unable to obtain the credit they need to buy our equipment.
This could result in continued significant increases in our material and component costs and the cost of machinery imported directly from our manufacturing operations in China. In addition, it may adversely impact demand for our products in China and elsewhere.
Such tariffs may result in significant increases in our material and component costs and the cost of machinery imported directly from our international manufacturing operations, which may make our products less cost competitive and reduce gross margins. It may also adversely impact demand for our products in certain locations.
In an effort to mitigate this, the Company has increased the prices of our products, recouped tariffs through duty drawback and exclusions, and worked with suppliers to ensure optimum pricing and inventory levels.
The Company has mitigated these risks with price increases on our products, recouped tariffs through duty drawback and exclusions, and working with suppliers to ensure optimum pricing and inventory levels.
Production capacity limits could cause us to reduce or delay sales efforts until production capacity is available. Financial and General Economy Risks Our business is sensitive to general economic conditions, government spending priorities and the cyclical nature of markets we serve.
Our business is sensitive to general economic conditions, government spending priorities and the cyclical nature of markets we serve.
Maintaining a strong reputation with team members, customers, investors, stakeholders and communities is critical to the success of our business.
Any sustainability goals, commitments, and targets reflect plans and do not guarantee that we will be able to achieve them. Maintaining a strong reputation with team members, customers, investors, stakeholders and communities is critical to the success of our business.
The U.S. government has imposed tariffs on certain foreign goods from a variety of countries and regions that it perceives as engaging in unfair trade practices, and previously raised the possibility of imposing additional tariff increases or expanding the tariffs to capture other types of goods.
The U.S. government has previously and now again recently imposed tariffs on certain foreign goods from a variety of countries and regions that it 15 perceives as engaging in unfair trade practices. Foreign governments have imposed, and may impose in the future, retaliatory tariffs on goods that their countries import from the U.S.
We may face limitations on our ability to integrate acquired businesses. From time to time, we may engage in strategic transactions involving risks, including the possible failure to successfully integrate and realize the expected benefits of such transactions.
We may not realize the anticipated benefits of such acquisitions, including the acquisition of ESG. From time to time, we engage in strategic transactions involving risks, including the possible failure to successfully integrate and realize the expected benefits of such transactions. We have consummated many acquisitions in the past and anticipate making additional acquisitions in the future.
In addition, tariffs imposed by the Chinese government on U.S. imports have made the cost of some of our products more expensive for our Chinese customers.
In addition, tariffs imposed by the Chinese government on U.S. imports have made the cost of some of our products more expensive for our Chinese customers. We have been able to mitigate some effects of tariffs through the U.S. government’s duty draw-back mechanism, tariff exclusion process, footprint utilization, and prudent sourcing.
If competition in our industry intensifies or if our current competitors lower their prices for competing products, we may lose sales or be required to lower the prices we charge for our products. One of our strategic initiatives is Innovate, which in part aims at the introduction of new or improved products, technologies and capabilities.
One of our strategic initiatives is Innovate, which in part aims at the introduction of new or improved products, technologies and capabilities.
The Coalition of American Manufacturers of Mobile Access Equipment, an alliance of mobile access equipment producers in the U.S. of which we are a member, pursued anti-dumping and countervailing cases against unfairly traded Chinese imports of mobile access equipment. The U.S. Department of Commerce has issued countervailing and anti-dumping duty rates on mobile access equipment from China.
The U.S. Department of Commerce has issued countervailing and anti-dumping duty rates on mobile access equipment from China.
This is part of our continuing strategy to deliver long-term growth and earnings to our stockholders. We have made, and continue to make, significant investments in these strategic initiatives. However, we cannot provide any assurance that we will be able to realize the full anticipated benefits of these initiatives.
Each business in our Company is unique, but all businesses are managed to the “Execute, Innovate, Grow” operating framework. This is part of our continuing strategy to deliver long-term growth and earnings to our stockholders. We have made, and continue to make, significant investments in these strategic initiatives.
In our lines of business, numerous suits have been filed alleging damages for accidents that have occurred during use, misuse or operation of our products. We are self-insured, up to certain limits, for these product liability exposures, as well as for certain 21 exposures related to general, workers’ compensation and automobile liability.
Legal, Regulatory & Compliance Risks We face litigation and product liability claims and other liabilities. In our lines of business, numerous suits have been filed alleging damages for accidents that have occurred during use, misuse or operation of our products.
Concern over climate change and sustainability also continues to result in new legal and regulatory requirements designed to mitigate the effects of climate change on the environment, including the European Union’s European Sustainability Reporting Standards and Corporate Sustainability Reporting Directive, California’s Climate Corporate Data Accountability Act and Climate Related Financial Risk Act, and similar regulations under consideration by the SEC.
Concerns regarding sustainability matters have resulted, and may continue to result, in new legal and regulatory requirements, including, but not limited to, the European Union’s European Sustainability Reporting Standards under the Corporate Sustainability Reporting Directive and California’s Climate Corporate Data Accountability Act and Climate Related Financial Risk Act.
The current cyber threat environment continues to indicate increased risk for all companies, with cyber-attacks expanding in both frequency and sophistication.
The current cyber threat environment continues to indicate increased risk for all companies, with cyber-attacks expanding in both frequency and sophistication. These threats may also be further enhanced in frequency or intensity through threat actors’ use of artificial intelligence technologies, which are becoming more rapidly developed and adopted.
Any significant difficulties in continuing to improve or expand our operations in developing markets may divert management’s attention from our existing operations and require a greater level of resources than we plan to commit. Expansion into developing markets may require modification of products to meet local requirements or preferences.
Efforts to improve operations in developing markets also requires us to hire, train and retain qualified personnel in countries where language, cultural or regulatory barriers may exist, and may require a greater level of management’s attention. Expansion into developing markets may also require modification of products to meet local requirements or preferences.
While we expect sales to remain stable in 2024, we cannot provide any assurance that there will not be global economic weakness or a recession based on the above uncertainties or other unknown factors.
We cannot provide any assurance that there will not be continued, increased global economic weakness and recessions based on the above uncertainties or other factors. The imposition of tariffs by the United States could trigger the adoption of tariffs by other countries as well.
The greater financial resources of certain of our competitors may put us at a competitive disadvantage. Low-cost competition from China and other developing markets could also result in decreased demand for our products.
Low-cost competition from China and other developing markets could also result in decreased demand for our products. If competition in our industry intensifies or if our current competitors lower their prices for competing products, we may lose sales or be required to lower the prices we charge for our products.
Any of these factors may have an adverse effect on us or may limit our flexibility in dealing with our workforce. Legal, Regulatory & Compliance Risks We face litigation and product liability claims and other liabilities.
Any of these factors may have an adverse effect on us or may limit our flexibility in managing our workforce. ITEM 1B. UNRESOLVED STAFF COMMENTS Not applicable.
We consummated a variety of acquisitions in the past three years and anticipate making additional acquisitions in the future including acquisitions that could be substantial in size. Our ability to realize the anticipated benefits of any purchase, including the expected combination benefits, will depend, to a large extent, on our ability to integrate any acquired businesses.
On October 8, 2024, we acquired ESG for $2 billion. Our ability to realize the 18 anticipated benefits of the acquisition, including the expected tax benefits and synergies, will depend, to a large extent, on our ability to integrate the businesses of both companies.
However, if we are unable to recover a substantial portion of increased costs from our customers and suppliers or duty draw-back, our business or results of operations could be adversely affected.
It may be time-consuming and costly for us to modify our business operations to adapt to or comply with such tariffs. If we become unable to recover a substantial portion of any increased tariff related costs, the recent or increased international tariffs could materially and adversely affect our business, financial condition and results of operations.
We are experiencing, and expect to continue to experience, increased compliance burdens and associated costs to meet the new regulatory obligations. We have devoted and expect to have to continue to devote significant expenditures in designing and manufacturing new forms of equipment that satisfy new laws/regulations and market expectations related to greenhouse gas emission reductions.
Sustainability is integral to our strategic business priorities, including product innovation and solutions that enable our customers to operate in safe and sustainable ways. We have devoted and expect to have to continue to devote expenditures and resources toward designing and manufacturing new forms of equipment that satisfy new laws/regulations and market expectations, and complying with sustainability reporting obligations.
Any of the foregoing could adversely affect our business, financial condition and results of operations. The timing and amount of benefits from our strategic initiatives may not be as expected and our financial results could be adversely impacted. Each business in our Company is unique, but all businesses are managed to the “Execute, Innovate, Grow” operating framework.
See Risk Factor entitled, “We have a significant amount of debt outstanding and must comply with covenants in our debt agreements.” The timing and amount of benefits from our strategic initiatives may not be as expected and our financial results could be adversely impacted.
Removed
We continue to focus on operational improvement in developing markets such as China, India, Latin America, the Middle East and Africa. These efforts will require us to hire, train and retain qualified personnel in countries where language, cultural or regulatory barriers may exist.
Added
Financial and General Economy Risks The imposition of new or increased international tariffs may have a material adverse effect on our business, financial condition and results of operations.
Removed
T he cost and availability of these materials, components and final assemblies have varied significantly in the past several years.
Added
Rising international tariffs, including any tariffs applied to goods traded between the U.S. and China, the U.S. and Mexico and the U.S. and Canada, could materially and adversely affect our business and results of operations.
Removed
Global logistics network challenges include shortages of shipping containers, ocean freight capacity constraints, international port delays, trucking and chassis shortages, railway and air freight capacity, rising inflation, wage increases and labor availability constraints, which have resulted in delays, shortages of key manufacturing components, increased order backlogs, and increased transportation costs.
Added
However, with certain tariff exclusions ending and with any new tariffs, it could further negatively impact global trade and economic conditions in many of the regions where we do business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

4 edited+0 added−0 removed11 unchanged
Biggest changeThe Board of Directors is cognizant of the critical value of managing cybersecurity threat risks and is updated on such matters accordingly. Cybersecurity risks are reviewed by the Board of Directors, at least annually, as part of our enterprise risk management process and as part of a separate update by our SVP Chief Digital Officer.
Biggest changeThe Board of Directors (“Board”) is cognizant of the critical value of managing cybersecurity threat risks and is updated on such matters accordingly. Cybersecurity risks are reviewed by the Board, at least annually, as part of our enterprise risk management process and as part of a separate update by our SVP Chief Digital Officer.
Senior management also keeps the Board of Directors apprised of cybersecurity incidents and related materiality assessments as appropriate. Terex has experienced cyber incidents in the normal course of business; however, no prior cybersecurity incident has had a material adverse effect on Terex’s business, strategy, results of operations, financial condition or reputation.
Senior management also keeps the Board apprised of cybersecurity incidents and related materiality assessments as appropriate. Terex has experienced cyber incidents in the normal course of business; however, no prior cybersecurity incident has had a material adverse effect on Terex’s business, strategy, results of operations, financial condition or reputation.
The Audit Committee assists the Board of Directors with its oversight of cybersecurity risks and the steps taken by the Company to monitor and mitigate such cybersecurity risks. The VP Cybersecurity and SVP Chief Digital Officer provide regular, periodic reports to the Audit Committee on cybersecurity metrics and matters.
The Audit Committee assists the Board with its oversight of cybersecurity risks and the steps taken by the Company to monitor and mitigate such cybersecurity risks. The VP Cybersecurity and SVP Chief Digital Officer provide regular, periodic reports to the Audit Committee on cybersecurity 25 metrics and matters.
For more information on the cybersecurity threats and risks we face, see Part I, Item 1A. – Risk Factors. 24
For more information on the cybersecurity threats and risks we face, see Part I, Item 1A. – Risk Factors. 26

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed2 unchanged
Biggest changeThe following table outlines the principal manufacturing, distribution, service and office facilities owned, leased or utilized through logistics service agreement (as indicated below) by the Company and its subsidiaries in relation to our continuing businesses: BUSINESS SEGMENT FACILITY LOCATION BUSINESS SEGMENT FACILITY LOCATION Corporate/Other Norwalk, Connecticut (1) MP (Continued) Fort Wayne, Indiana Schaffhausen, Switzerland (1) Olds, Alberta Canada (1) Multiple Business Segments Southaven, Mississippi (1) Bad Schönborn, Germany Changzhou, China Brisbane, Australia (1) Roosendaal, Netherlands (2) Crespellano, Italy MP Oklahoma City, Oklahoma (1) Fontanafredda, Italy (1) Louisville, Kentucky Monaghan, Republic of Ireland Durand, Michigan Mount Vernon, Missouri Coalville, England Jiading, China Hosur, India (1) AWP Moses Lake, Washington (1) Subang Jaya, Malaysia (1) North Bend, Washington (1) Ballymoney, Northern Ireland Redmond, Washington (1) Campsie, Northern Ireland Bothell, Washington (1) Dungannon, Northern Ireland Umbertide, Italy Omagh, Northern Ireland (1) Darra, Australia (1) Cookstown, Northern Ireland Watertown, South Dakota Newton, New Hampshire Huron, South Dakota Canton, South Dakota Monterrey, Mexico (1) These facilities are either partially or fully leased or subleased.
Biggest changeThe following table outlines the principal manufacturing, distribution, service and office facilities owned, leased or utilized through logistics service agreement (as indicated below) by the Company and its subsidiaries in relation to our continuing businesses: BUSINESS SEGMENT FACILITY LOCATION BUSINESS SEGMENT FACILITY LOCATION Corporate/Other Norwalk, Connecticut (1) MP (Continued) Bad Schönborn, Germany Schaffhausen, Switzerland (1) Brisbane, Australia (1) Multiple Business Segments Southaven, Mississippi (1) Crespellano, Italy Changzhou, China Fontanafredda, Italy (1) Roosendaal, Netherlands (2) Monaghan, Republic of Ireland MP Oklahoma City, Oklahoma (1) Mount Vernon, Missouri Louisville, Kentucky Jiading, China Durand, Michigan AWP Moses Lake, Washington (1) Coalville, England North Bend, Washington (1) Hosur, India (1) Redmond, Washington (1) Subang Jaya, Malaysia (1) Bothell, Washington (1) Ballymoney, Northern Ireland Umbertide, Italy Campsie, Northern Ireland Darra, Australia (1) Dungannon, Northern Ireland Watertown, South Dakota Omagh, Northern Ireland (1) Huron, South Dakota Cookstown, Northern Ireland Monterrey, Mexico Newton, New Hampshire Sanand, Gujarat, India Canton, South Dakota ESG Fort Payne, Alabama (1) Fort Wayne, Indiana Vernon, Alabama Olds, Alberta Canada (1) Chattanooga, Tennessee (1) (1) These facilities are either partially or fully leased or subleased.
ITEM 2. PROPERTIES As of December 31, 2023, our principal manufacturing, distribution, service and office facilities comprised a total of approximately seven million square feet of space worldwide.
ITEM 2. PROPERTIES As of December 31, 2024, our principal manufacturing, distribution, service and office facilities comprised a total of approximately eight million square feet of space worldwide.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+1 added−1 removed2 unchanged
Biggest changeHowever, outcomes of lawsuits cannot be predicted and, if determined adversely, could ultimately result in us incurring significant liabilities which could have a material adverse effect on our results of operations.
Biggest changeHowever, outcomes of lawsuits cannot be predicted and, if determined adversely, could ultimately result in us incurring significant liabilities which could have a material adverse effect on our results of operations. For information regarding litigation and other contingencies and uncertainties, see Note N – “Litigation and Contingencies,” in the Notes to Consolidated Financial Statements. ITEM 4.
Removed
For information regarding litigation and other contingencies and uncertainties, including our proceedings involving a claim in Brazil regarding payment of ICMS tax (Brazilian state value-added tax), see Note N – “Litigation and Contingencies,” in the Notes to Consolidated Financial Statements. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 25 PART II
Added
MINE SAFETY DISCLOSURES Not applicable. 27 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+0 added−1 removed2 unchanged
Biggest changeIn February 2024, Terex’s Board of Directors declared a dividend of $0.17 per share, which will be paid on March 19, 2024 to the Company’s stockholders of record as of March 8, 2024.
Biggest changeIn February 2025, Terex’s Board declared a dividend of $0.17 per share, which will be paid on March 19, 2025 to the Company’s stockholders of record as of March 7, 2025. Any additional payments of dividends will depend upon our financial condition, capital requirements and earnings, as well as other factors that the Board may deem relevant.
All rights reserved. Purchases of Equity Securities The following table provides information about our purchases during the quarter ended December 31, 2023 of our common stock that is registered by us pursuant to the Exchange Act.
All rights reserved. Purchases of Equity Securities The following table provides information about our purchases during the quarter ended December 31, 2024 of our common stock that is registered by us pursuant to the Exchange Act.
The stock performance graph shows the change in market value of $100 invested in our common stock, the Standard & Poor’s (“S&P”) 500 Stock Index and the S&P Industrial Machinery Index for the period commencing December 31, 2018 through December 31, 2023. The cumulative total stockholder return assumes dividends are reinvested.
The stock performance graph shows the change in market value of $100 invested in our common stock, the Standard & Poor’s (“S&P”) 500 Stock Index and the S&P 500 Industrial Machinery & Supplies & Components Index for the period commencing December 31, 2019 through December 31, 2024. The cumulative total stockholder return assumes dividends are reinvested.
(2) In July 2018, our Board of Directors authorized the repurchase of up to $300 million of our outstanding shares of common stock. In December 2022, our Board of Directors authorized the additional repurchase up to $150 million of our outstanding shares of common stock. ITEM 6. RESERVED 27
(2) In December 2022, our Board authorized the repurchase up to $150 million of our outstanding shares of common stock. ITEM 6. RESERVED 29
Performance Graph The following stock performance graph is intended to show our stock performance compared with that of comparable companies.
As of February 4, 2025, there were 472 registered stockholders of record of our common stock. Performance Graph The following stock performance graph is intended to show our stock performance compared with that of comparable companies.
We believe that our diversified portfolio of businesses, which evolves in accordance with acquisitions, dispositions and other transactions, is better benchmarked against the S&P Industrial Machinery Index for comparison prospectively rather than a self-selected peer group of individual companies. 26 12/18 12/19 12/20 12/21 12/22 12/23 Terex Corporation 100.00 109.68 129.28 164.44 162.05 220.56 S&P 500 100.00 131.49 155.68 200.37 164.08 207.21 S&P Industrial Machinery & Components 100.00 136.87 157.91 194.16 165.21 208.28 Copyright© 2023 Standard & Poor's, a division of S&P Global.
We believe that our diversified portfolio of businesses, which evolves in accordance with acquisitions, dispositions and other transactions, is better benchmarked against the S&P 500 Industrial Machinery & Supplies & Components Index for comparison prospectively rather than a self-selected peer group of individual companies. 28 12/19 12/20 12/21 12/22 12/23 12/24 Terex Corporation 100.00 117.87 149.92 147.75 201.09 163.71 S&P 500 100.00 118.40 152.39 124.79 157.59 197.02 S&P 500 Industrial Machinery & Supplies & Components 100.00 115.38 141.86 120.71 152.18 169.14 Copyright© 2025 Standard & Poor's, a division of S&P Global.
Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) (2) October 1, 2023 – October 31, 2023 148,979 $48.47 148,129 $151,793 November 1, 2023 – November 30, 2023 300,798 $48.52 299,841 $137,246 December 1, 2023 – December 31, 2023 105,691 $50.83 102,600 $132,050 Total 555,468 $48.95 550,570 $132,050 (1) Amount includes shares of common stock purchased to satisfy requirements under the Company’s deferred compensation obligations to employees.
Issuer Purchases of Equity Securities Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs (in thousands) (2) October 1, 2024 – October 31, 2024 65,197 $52.42 64,308 $97,231 November 1, 2024 – November 30, 2024 72,812 $52.69 72,034 $93,438 December 1, 2024 – December 31, 2024 166,086 $47.71 161,961 $85,715 Total 304,095 $49.91 298,303 $85,715 (1) Amount includes shares of common stock purchased to satisfy requirements under the Company’s deferred compensation obligations to employees.
Removed
Any additional payments of dividends will depend upon our financial condition, capital requirements and earnings, as well as other factors that the Board of Directors may deem relevant. As of February 6, 2024, there were 485 registered stockholders of record of our common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

71 edited+40 added−23 removed59 unchanged
Biggest changeDec '23 Sep '23 Jun '23 Mar '23 Dec '22 Effective tax rate as adjusted 18.2 % 18.2 % 18.2 % 18.2 % Income (loss) from operations $ 115.7 $ 163.2 $ 209.9 $ 147.7 Multiplied by: 1 minus effective tax rate as adjusted 81.8 % 81.8 % 81.8 % 81.8 % Net operating income (loss) after tax $ 94.6 $ 133.5 $ 171.7 $ 120.8 Debt $ 623.2 $ 708.7 $ 736.7 $ 777.0 $ 775.5 Less: Cash and cash equivalents (370.7) (352.3) (297.7) (254.2) (304.1) Debt less Cash and cash equivalents 252.5 356.4 439.0 522.8 471.4 Stockholders’ equity 1,672.3 1,496.2 1,432.2 1,294.6 1,181.2 Debt less Cash and cash equivalents plus Stockholders’ equity $ 1,924.8 $ 1,852.6 $ 1,871.2 $ 1,817.4 $ 1,652.6 December 31, 2023 ROIC 28.5 % NOPAT as adjusted (last 4 quarters) $ 520.6 Average Debt less Cash and cash equivalents plus Stockholders’ equity (5 quarters) $ 1,823.7 Twelve Months Ended December 31, 2023 Income (loss) from continuing operations before income taxes (Provision for) benefit from income taxes Income tax rate Reconciliation of the full year 2023 effective tax rate: As reported 579.7 (63.0) 10.9 % Effect of adjustments: Tax related to Swiss deferred tax asset — (42.3) As adjusted $ 579.7 $ (105.3) 18.2 % 31 RESULTS OF OPERATIONS The following discussion should be read in conjunction with the consolidated financial statements and accompanying notes included in Exhibit 15 (a) (1) and (2) Financial Statements and Financial Statement Schedules of this Annual Report on Form 10-K.
Biggest changeDec '24 Sep '24 Jun '24 Mar '24 Dec '23 Effective tax rate as adjusted 15.6 % 15.6 % 15.6 % 15.6 % Income (loss) from operations as adjusted 97 127 196 162 Multiplied by: 1 minus effective tax rate as adjusted 84.4 % 84.4 % 84.4 % 84.4 % Net operating income (loss) after tax as adjusted $ 82 $ 107 $ 165 $ 137 Debt $ 2,584 $ 628 $ 666 $ 724 $ 623 Less: Cash and cash equivalents (388) (352) (319) (365) (371) Debt less Cash and cash equivalents 2,196 276 347 359 252 Stockholders’ equity as adjusted 1,918 1,993 1,850 1,751 1,682 Debt less Cash and cash equivalents plus Stockholders’ equity as adjusted $ 4,114 $ 2,269 $ 2,197 $ 2,110 $ 1,934 December 31, 2024 ROIC 19.4 % NOPAT as adjusted (last 4 quarters) $ 491 Average Debt less Cash and cash equivalents plus Stockholders’ equity as adjusted (5 quarters) $ 2,525 Three months ended 12/31/24 Three months ended 9/30/24 Three months ended 6/30/24 Three months ended 3/31/24 Reconciliation of income (loss) from operations: Income (loss) from operations as reported $ 53 $ 122 $ 193 $ 158 Adjustments: Accelerated vesting / severance 4 5 3 4 Purchase price accounting 38 — — — Deal related 2 — — — Income (loss) from operations as adjusted $ 97 $ 127 $ 196 $ 162 As of 12/31/24 As of 9/30/24 As of 6/30/24 As of 3/31/24 As of 12/31/23 Reconciliation of Stockholders’ equity: Stockholders’ equity as reported $ 1,832 $ 1,957 $ 1,824 $ 1,732 $ 1,672 Effects of adjustments, net of tax: Accelerated vesting / severance 25 21 17 14 11 Purchase price accounting 32 — — — — Deal related 16 2 2 — — Product liability 3 3 3 3 3 Mark-to-market 10 10 4 2 (4) Stockholders’ equity as adjusted $ 1,918 $ 1,993 $ 1,850 $ 1,751 $ 1,682 33 Twelve Months Ended December 31, 2024 Income (loss) from continuing operations before income taxes (Provision for) benefit from income taxes Income tax rate Reconciliation of the full year 2024 effective tax rate: As reported $ 408 $ (73) 17.8 % Effect of adjustments: Accelerated vesting / severance 16 (4) Purchase price accounting 38 (6) Deal related 28 (6) Mark-to-Market 9 (2) Tax related to Swiss deferred tax asset — 8 Foreign tax redetermination UTP — 5 As adjusted $ 499 $ (78) 15.6 % 34 RESULTS OF OPERATIONS The following discussion should be read in conjunction with the consolidated financial statements and accompanying notes included in Exhibit 15 (a) (1) and (2) Financial Statements and Financial Statement Schedules of this Annual Report on Form 10-K.
Our practice is to file income tax returns that conform to requirements of each jurisdiction and to record provisions for tax liabilities, including interest and penalties, in accordance with Accounting Standards Codification 740, “Income Taxes.” Given the 36 continued changes and complexity in worldwide tax laws, coupled with our geographic scope and size there may be greater exposure to uncertain tax positions.
Our practice is to file income tax returns that conform to requirements of each jurisdiction and to record provisions for tax liabilities, including interest and penalties, in accordance with Accounting Standards Codification 740, “Income Taxes.” Given the continued changes and complexity in worldwide tax laws, coupled with our geographic scope and size there may be greater exposure to uncertain tax positions.
Non-GAAP Measures In this document, we refer to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures. These non-GAAP measures may not be comparable to similarly titled measures disclosed by other companies.
Non-GAAP Measures In this document, we refer to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures. These non-GAAP measures may not be comparable to similarly titled measures being disclosed by other companies.
If, after assessing the totality of events or circumstances, we determine that it is more likely than not that the fair values of our reporting units are greater than the carrying amounts, then a quantitative impairment test does not need to be performed. 35 If the qualitative assessment indicates a quantitative analysis should be performed or a quantitative analysis is directly elected, we evaluate goodwill for impairment by comparing the fair value of each of our reporting units to its carrying value, including the associated goodwill.
If, after assessing the totality of events or circumstances, we determine that it is more likely than not that the fair values of our reporting units are greater than the carrying amounts, then a quantitative impairment test does not need to be performed. 38 If the qualitative assessment indicates a quantitative analysis should be performed or a quantitative analysis is directly elected, we evaluate goodwill for impairment by comparing the fair value of each of our reporting units to its carrying value, including the associated goodwill.
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. Our products are manufactured in North America, Europe, Australia and Asia and sold worldwide.
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. Our products are manufactured in North America, Europe, and Asia Pacific and sold worldwide.
We engage with customers through all stages of the product life cycle, from initial specification to parts and service support. We report our business in the following segments: (i) MP and (ii) AWP. Further information about our reportable segments appears below and in Note B – “Business Segment Information” in the Notes to Consolidated Financial Statements.
We engage with customers through all stages of the product life cycle, from initial specification to parts and service support. We report our business in the following segments: (i) MP, (ii) AWP, and (iii) ESG. Further information about our reportable segments appears below and in Note B – “Business Segment Information” in the Notes to Consolidated Financial Statements.
RECENT ACCOUNTING STANDARDS Please refer to Note A – “Basis of Presentation” in the accompanying Consolidated Financial Statements for a summary of recently issued accounting standards. 37 LIQUIDITY AND CAPITAL RESOURCES We are focused on generating cash and maintaining liquidity (cash and availability under our revolving line of credit) for the efficient operation of our business.
RECENT ACCOUNTING STANDARDS Please refer to Note A – “Basis of Presentation” in the accompanying Consolidated Financial Statements for a summary of recently issued accounting standards. 40 LIQUIDITY AND CAPITAL RESOURCES We are focused on generating cash and maintaining liquidity (cash and availability under our revolving line of credit) for the efficient operation of our business.
The unavailable information could have a significant impact on the Company’s full year 2024 GAAP financial results. This forward-looking information provides guidance to investors about our EPS expectations excluding these unusual items that we do not believe are reflective of our ongoing operations.
The unavailable information could have a significant impact on the Company’s full year 2025 GAAP financial results. This forward-looking information provides guidance to investors about our EPS expectations excluding these unusual items that we do not believe are reflective of our ongoing operations.
Discussions of 2021 and year-over-year comparison of 2022 and 2021 are not included in this document and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022.
Discussions of 2022 and year-over-year comparison of 2023 and 2022 are not included in this document and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023.
We discuss forward-looking information related to expected earnings per share (“EPS”) excluding the impact of potential future acquisitions, divestitures, restructuring and other unusual items. Our 2024 outlook for earnings per share is a non-GAAP financial measure because it excludes unusual items.
We discuss forward-looking information related to expected earnings per share (“EPS”) excluding the impact of potential future acquisitions, divestitures, restructuring and other unusual items. Our 2025 outlook for EPS is a non-GAAP financial measure because it excludes unusual items.
Our ability to generate cash from operations is subject to numerous factors, including the following: • The duration and depth of the global economic volatility resulting from supply chain constraints, inflationary pressures, foreign exchange rate volatility, geopolitical uncertainty and rising interest rates. • As our sales change, the amount of working capital needed to support our business may change. • Many of our customers fund their purchases through third-party finance companies that extend credit based on the creditworthiness of customers and expected residual value of our equipment.
Our ability to generate cash from operations is subject to numerous factors, including the following: • The duration and depth of the global economic volatility resulting from inflationary pressures, foreign exchange rate volatility, geopolitical uncertainty and high interest rates. • As our sales change, the amount of working capital needed to support our business may change. • Many of our customers fund their purchases through third-party finance companies that extend credit based on the creditworthiness of customers and expected residual value of our equipment.
Future interest payments associated with the outstanding debt are approximately $180 million with $30 million payable within 12 months. For detailed debt information see Note J – “Long Term Obligations” in Notes to Consolidated Financial Statements. Leases The Company has leases for real property, vehicles and office and industrial equipment.
Future interest payments associated with the outstanding debt are approximately $645 million with $152 million payable within 12 months. For detailed debt information see Note J – “Long Term Obligations” in Notes to Consolidated Financial Statements. Leases The Company has leases for real property, vehicles and office and industrial equipment.
This section of our Annual Report on Form 10-K generally discusses 2023 and 2022 and provides a year-over-year comparison of 2023 and 2022.
This section of our Annual Report on Form 10-K generally discusses 2024 and 2023 and provides a year-over-year comparison of 2024 and 2023.
Incremental cash repatriated to the U.S. would not be expected to result in material foreign income and withholding, U.S. federal or state income tax cost. We will continue to seek opportunities to tax-efficiently mobilize and redeploy funds. We had free cash flow of $365.7 million for the year ended December 31, 2023.
Incremental cash repatriated to the U.S. would not be expected to result in material foreign income and withholding, U.S. federal or state income tax cost. We will continue to seek opportunities to tax-efficiently mobilize and redeploy funds. We had free cash flow of $190 million for the year ended December 31, 2024.
The lower effective tax rate for the year ended December 31, 2023 when compared to the year ended December 31, 2022 was primarily due to one-time tax benefit derived from recording of a deferred tax asset in relation to our Swiss operations.
The higher effective tax rate for the year ended December 31, 2024 when compared to the year ended December 31, 2023 was primarily due to one-time tax benefit in 2023 derived from recording of a deferred tax asset in relation to our Swiss operations.
The increase in cash used in financing activities was primarily due to higher debt repayments and lower debt borrowing in the current year, partially offset by lower share repurchases in the current year. 40 OFF-BALANCE SHEET ARRANGEMENTS Guarantees We may assist customers in their rental, leasing and acquisition of our products by facilitating financing transactions directly between (i) end-user customers, distributors and rental companies and (ii) third-party financial institutions, providing recourse in certain circumstances.
The increase in cash provided in financing activities was primarily due to higher debt borrowing and lower debt repayments. OFF-BALANCE SHEET ARRANGEMENTS Guarantees We may assist customers in their rental, leasing and acquisition of our products by facilitating financing transactions directly between (i) end-user customers, distributors and rental companies and (ii) third-party financial institutions, providing recourse in certain circumstances.
Additionally, at December 31, 2023, we had outstanding letters of credit that totaled $119.9 million and maximum exposure of $89.4 million for credit guarantees outstanding related to recourse provided to third-party financial institutions when customers finance the purchase of equipment. We maintain defined benefit pension plans for some of our U.S. and non-U.S. operations.
Additionally, at December 31, 2024, we had outstanding letters of credit that totaled $95 million and maximum exposure of $72 million for credit guarantees outstanding related to recourse provided to third-party financial institutions when customers finance the purchase of equipment. We maintain defined benefit pension plans for some of our U.S. and non-U.S. operations.
For example, during periods of economic uncertainty, our customers have delayed purchasing decisions, which reduces cash generated from operations. • Availability and utilization of other sources of liquidity such as trade accounts receivable sales programs.
For example, during periods of economic uncertainty, our customers have delayed purchasing decisions, which in turn reduces cash generated from operations. • Availability and utilization of other sources of liquidity such as trade account receivables sales programs.
It is our policy to fund the retirement plans at the minimum level required by applicable regulations. In 2023, we made cash contributions and payments to the retirement plans of $9.8 million, and we estimate that our retirement plan contributions will be approximately $10 million in 2024.
It is our policy to fund the retirement plans at the minimum level required by applicable regulations. In 2024, we made cash contributions and payments to the retirement plans of $11 million, and we estimate that our retirement plan contributions will be approximately $4 million in 2025.
Our management and Board of Directors use ROIC as one measure to assess operational performance, including in connection with certain compensation programs. We use ROIC as a metric because we believe it measures how effectively we invest our capital and provides a better measure to compare ourselves to peer companies to assist in assessing how we drive operational improvement.
Our management and Board use ROIC as one measure to assess operational performance, which is also included in certain compensation programs. We use ROIC as a metric because we believe it measures how effectively we invest our capital and provides a better measure to compare ourselves to peer companies to assist in assessing how we drive operational improvement.
See “Liquidity and Capital Resources” for a detailed description of liquidity and working capital levels, including 29 the primary factors affecting such levels, as well as a reconciliation of net cash provided by (used in) operating activities to free cash flow. Customer demand remains strong for our products and services.
See “Liquidity and Capital Resources” for a detailed description of liquidity and working capital levels, including the primary factors affecting such levels, as well as a reconciliation of net cash provided by (used in) operating activities to free cash flow.
As the tables below show, our ROIC at December 31, 2023 was 28.5%. 30 Amounts described below are reported in millions of U.S. dollars, except for the effective tax rate as adjusted. Amounts are as of and for the three months ended for the periods referenced in the tables below.
As the tables below show, our ROIC at December 31, 2024 was 19.4%. 32 Amounts described below are reported in millions of U.S. dollars, except for the effective tax rate as adjusted. Amounts are as of and for the three months ended for the periods referenced in the tables below.
For contingencies and uncertainties other than income taxes, when it is probable a loss will be incurred and possible to make reasonable estimates of our liability with respect to such matters, a provision is recorded for the amount of such estimate or for the minimum amount of a range of estimates when it is not possible to estimate the amount within the range that is most likely to occur. 41 We generate hazardous and non-hazardous wastes in the normal course of our manufacturing operations.
For contingencies and uncertainties other than income taxes, when it is probable a loss will be incurred and possible to make reasonable estimates of our liability with respect to such matters, a provision is recorded for the amount of such estimate or for the minimum amount of a range of estimates when it is not possible to estimate the amount within the range that is most likely to occur.
Changes in market conditions, changes in our funding levels or actions by governmental agencies may result in accelerated funding requirements in future periods. In 2024, we expect approximately $145 million in capital expenditures, with our largest expenditure related to our manufacturing facility in Mexico.
Changes in market conditions, changes in our funding levels or actions by governmental agencies may result in accelerated funding requirements in future periods. In 2025, we expect approximately $120 million in capital expenditures, with our largest expenditures related to our manufacturing facility in Mexico and transformation initiatives.
As a result, we are subject to a wide range of environmental laws and regulations. All of our employees are required to obey all applicable health, safety and environmental laws and regulations and must observe the proper safety rules and environmental practices in work situations.
We generate hazardous and non-hazardous wastes in the normal course of our manufacturing operations. As a result, we are subject to a wide range of environmental laws and regulations. All of our employees are required to obey all applicable health, safety and environmental laws and regulations and must observe the proper safety rules and environmental practices in work situations.
In February 2024, our Board of Directors declared a dividend of $0.17 per share, which will be paid on March 19, 2024 to our stockholders of record as of March 8, 2024.
Our Board declared a dividend of $0.17 per share in each quarter of 2024, which were paid to our stockholders. In February 2025, our Board declared a dividend of $0.17 per share, which will be paid on March 19, 2025 to our stockholders of record as of March 7, 2025.
However, actual claims could be higher or lower than amounts estimated, as the amount and value of warranty claims are subject to variation as a result of many factors that cannot be predicted with certainty, including production quality issues, performance of new products, models and technology, changes in weather conditions for product operation, different uses for products and other similar factors.
However, actual claims could be higher or lower than amounts estimated, as the amount and value of warranty claims are subject to variation as a result of many factors that cannot be predicted with certainty, including production quality issues, performance of new products, models and technology, changes in weather conditions for product operation, different uses for products and other similar factors. 39 Income Taxes – We estimate income taxes based on enacted tax laws in the various jurisdictions where we conduct business.
The loss in 2022 primarily related to the sale of our former mobile cranes business in 2019. 34 CRITICAL ACCOUNTING ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period.
The gain in 2023 primarily relates to post-closing adjustments related to the sales of our former MHPS and mobile cranes businesses. 37 CRITICAL ACCOUNTING ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period.
Gain (Loss) on Disposition of Discontinued Operations – Net of Tax During the years ended December 31, 2023 and 2022, we recognized a gain (loss) on disposition of discontinued operations - net of tax of $1.3 million and $(0.2) million, respectively.
Gain (Loss) on Disposition of Discontinued Operations – Net of Tax During the year ended December 31, 2023, we recognized a gain (loss) on disposition of discontinued operations - net of tax of $1 million.
The loss recognized would not exceed total amount of goodwill allocated to that reporting unit. The quantitative assessment indicated that each reporting unit had an estimated fair value which substantially exceeded its respective carrying amount at the annual impairment test date.
The quantitative assessment indicated that each reporting unit had an estimated fair value which substantially exceeded its respective carrying amount at the annual impairment test date.
At December 31, 2023, we had cash and cash equivalents of $371 million and undrawn availability under our revolving line of credit of $600 million, giving us total liquidity of approximately $971 million.
At December 31, 2024, we had cash and cash equivalents of $388 million and undrawn availability under our revolving line of credit of $800 million, giving us total liquidity of approximately $1,188 million.
Corporate and Other / Eliminations 2023 2022 2021 % of Sales % of Sales % of Sales % Change in Reported Amounts 2023 vs 2022 ($ amounts in millions) Net sales $ 2.8 — $ (7.5) — $ 16.2 — 137.3 % Loss from operations (93.4) * (74.0) * (65.0) * (26.2) % * Not a meaningful percentage Loss from operations for the year ended December 31, 2023 increased $19.4 million when compared to 2022.
Corporate and Other / Eliminations 2024 2023 2022 % of Sales % of Sales % of Sales % Change in Reported Amounts 2024 vs 2023 ($ amounts in millions) Net sales $ 1 — $ 3 — $ (8) — (66.7) % Loss from operations (80) * (93) * (74) * 14.0 % * Not a meaningful percentage Loss from operations for the year ended December 31, 2024 decreased $13 million when compared to 2023.
These deferred income tax balances arise from temporary differences due to divergent treatment of certain items for accounting and income tax purposes. We evaluate the net realizable value of our deferred tax assets each period to ensure that estimated future taxable income will be sufficient in character, amount and timing to result in the use of our deferred tax assets.
We evaluate the net realizable value of our deferred tax assets each period to ensure that estimated future taxable income will be sufficient in character, amount and timing to result in the use of our deferred tax assets.
Other We are subject to a number of contingencies and uncertainties including, without limitation, product liability claims, workers’ compensation liability, intellectual property litigation, self-insurance obligations, tax examinations, guarantees, class action lawsuits and other matters.
Other We are subject to a number of contingencies and uncertainties including, without limitation, product liability claims, workers’ compensation liability, intellectual property litigation, self-insurance obligations, tax examinations, guarantees, class action lawsuits and other matters. See Note N – “Litigation and Contingencies” in the Notes to Consolidated Financial Statements for more information regarding contingencies and uncertainties.
Debt is calculated using amounts for Current portion of long-term debt plus Long-term debt, less current portion. We calculate ROIC using the last four quarters’ NOPAT as this represents the most recent 12-month period at any given point of determination.
We calculate ROIC using the last four quarters’ NOPAT as this represents the most recent 12-month period at any given point of determination.
CONTINGENCIES AND UNCERTAINTIES Foreign Exchange and Interest Rate Risk Our products are sold in over 100 countries around the world and, accordingly, our revenues are generated in foreign currencies, while costs associated with those revenues are only partly incurred in the same currencies.
See Note N – “Litigation and Contingencies” in the Notes to Consolidated Financial Statements for further information regarding our guarantees. 43 CONTINGENCIES AND UNCERTAINTIES Foreign Exchange and Interest Rate Risk Our products are sold in over 100 countries around the world and, accordingly, our revenues are generated in foreign currencies, while costs associated with those revenues are only partly incurred in the same currencies.
Purchase Obligations The Company had purchase obligations of approximately $686 million, with substantially all purchase obligations payable within 12 months. Purchase obligations include non-cancellable and cancellable commitments. In many cases, cancellable commitments contain penalty provisions for cancellation.
For detailed lease information see Note K – “Leases” in Notes to Consolidated Financial Statements. 42 Purchase Obligations The Company had purchase obligations of approximately $536 million, with substantially all purchase obligations payable within 12 months. Purchase obligations include non-cancellable and cancellable commitments. In many cases, cancellable commitments contain penalty provisions for cancellation.
The decrease in expense was primarily due to mark-to-market gains recorded on an equity investment in 2023 compared to losses recorded in 2022, partially offset by higher non-service cost portion of pension expense in 2023.
The increase in expense was primarily due to transaction costs related to ESG acquisition and higher mark-to-market losses recorded on an equity investment in 2024 compared to gains recorded in 2023, partially offset by favorable impact of changes in foreign exchange rates and lower non-service cost portion of pension expense in 2024.
Income Taxes During the year ended December 31, 2023, we recognized income tax expense of $63.0 million on income of $579.7 million, an effective tax rate of 10.9%, as compared to income tax expense of $66.4 million on income of $366.6 million, an effective tax rate of 18.1%, for the year ended December 31, 2022.
Income Taxes During the year ended December 31, 2024, we recognized income tax expense of $73 million on income of $408 million, an effective tax rate of 17.8%, as compared to income tax expense of $63 million on income of $580 million, an effective tax rate of 10.9%, for the year ended December 31, 2023.
Our actions to maintain liquidity include disciplined management of costs and working capital.
We have no significant debt maturities until 2029. Our actions to maintain liquidity include disciplined management of costs and working capital.
Cash Flows Cash provided by operations was $459.3 million and $261.2 million for the years ended December 31, 2023 and 2022, respectively. The increase in cash provided by operations was primarily driven by increased operating profitability in the current year.
Cash Flows Cash provided by operations was $326 million and $459 million for the years ended December 31, 2024 and 2023, respectively. The decrease in cash provided by operations was primarily driven by lower operating profitability. Cash used in investing activities was $2,127 million and $114 million for the years ended December 31, 2024 and 2023, respectively.
In the calculation of ROIC, we adjusted the effective tax rate for a one-time tax benefit derived from recording of a deferred tax asset in relation to our Swiss operations to create a measure that is more useful to understanding our operating results and the ongoing performance of our underlying business as shown in the tables below.
In the calculation of ROIC, we adjust income (loss) from operations, effective tax rate, and stockholders’ equity to remove the effects of the impact of certain transactions in order to create a measure that is more useful to understanding our operating results and the ongoing performance of our underlying business excluding the impact of unusual items as shown in the tables below.
The following tables show the calculation of our working capital and trailing three months annualized sales as of December 31, 2023 (in millions): Three months ended December 31, 2023 Net sales $ 1,222.6 x 4 Trailing three month annualized net sales $ 4,890.4 As of December 31, 2023 Inventories $ 1,186.0 Receivables 547.8 Trade accounts payable (702.6) Customer advances (32.2) Working capital $ 999.0 We remain focused on expanding customer financing solutions in key markets like the U.S., Europe and China.
The following tables show the calculation of our working capital and trailing three months annualized sales as of December 31, 2024 (in millions): Three months ended December 31, 2024 Net sales $ 1,241 x 4 Trailing three month annualized net sales $ 4,964 As of December 31, 2024 Inventories $ 1,147 Receivables 643 Trade accounts payable (580) Customer advances (21) Working capital $ 1,189 We remain focused on use of TFS to drive incremental sales by facilitating customer financing solutions in key markets.
As of December 31, 2023, the Company had contractual fixed costs primarily related to lease commitments of approximately $160 million, with $43 million payable within 12 months. For detailed lease information see Note K – “Leases” in Notes to Consolidated Financial Statements.
As of December 31, 2024, the Company had contractual fixed costs primarily related to lease commitments of approximately $173 million, with $46 million payable within 12 months.
Trailing three months annualized net sales is calculated using net sales for the most recent quarter end multiplied by four. The ratio calculated by dividing working capital by trailing three months annualized net sales is a non-GAAP measure we believe measures our resource use efficiency.
Trailing three months annualized net sales is calculated using net sales for the most recent quarter end multiplied by four.
ROIC is determined by dividing the sum of NOPAT for each of the previous four quarters by the average of Debt less Cash and cash equivalents plus Stockholders’ equity for the previous five quarters. NOPAT for each quarter is calculated by multiplying Income (loss) from operations by one minus the full year 2023 effective tax rate as adjusted.
NOPAT for each quarter is calculated by multiplying Income (loss) from operations by one minus the full year 2024 effective tax rate as adjusted. Debt is calculated using amounts for Current portion of long-term debt plus Long-term debt, less current portion.
Pursuant to terms of our trade accounts receivable factoring arrangements, during the year ended December 31, 2023, we sold, without material recourse, approximately $835 million of trade accounts receivable to enhance liquidity. 38 Working capital as a percent of trailing three month annualized net sales was 20.4% at December 31, 2023.
The following table reconciles net cash provided by (used in) operating activities to free cash flow (in millions): Year Ended 12/31/2024 Net cash provided by (used in) operating activities $ 326 Capital expenditures, net of proceeds from sale of capital assets (136) Free cash flow (use) $ 190 Pursuant to terms of our trade accounts receivable factoring arrangements, during the year ended December 31, 2024, we sold, without material recourse, approximately $715 million of trade accounts receivable to enhance liquidity. 41 Working capital as a percent of trailing three month annualized net sales was 24.0% at December 31, 2024.
Non-GAAP measures also include Net Operating Profit After Tax (“NOPAT”) and effective tax rate as adjusted, which is used in the calculation of our after tax return on invested capital (“ROIC”) (collectively the “Non-GAAP Measures”), which are discussed in detail below. 28 Overview Safety remains our top priority; driven by Think Safe – Work Safe – Home Safe.
The ratio calculated by dividing working capital by trailing three months annualized net sales is a non-GAAP measure we believe measures our resource use efficiency. 30 Non-GAAP measures also include Net Operating Profit After Tax (“NOPAT”) as adjusted, income (loss) from operations as adjusted, effective tax rate as adjusted and stockholders’ equity as adjusted, which is used in the calculation of our after tax return on invested capital (“ROIC”) (collectively the “Non-GAAP Measures”), which are discussed in detail below.
Income from operations for the year ended December 31, 2023 increased $175.1 million when compared to 2022 primarily due to incremental profit achieved on higher sales volume, price realization, improved manufacturing efficiencies and cost reduction initiatives, partially offset by SG&A cost increases.
Income from operations for the year ended December 31, 2024 decreased $29 million when compared to 2023 primarily due to unfavorable product mix, and unfavorable absorption from reduced production in the second half of the year, partially offset by incremental profit achieved on higher sales volume and reduced SG&A expenses.
Materials Processing 2023 2022 2021 % of Sales % of Sales % of Sales % Change in Reported Amounts 2023 vs 2022 ($ amounts in millions) Net sales $ 2,227.0 — $ 1,941.6 — $ 1,691.8 — 14.7 % Income from operations 358.6 16.1 % 297.8 15.3 % 240.9 14.2 % 20.4 % Net sales for the year ended December 31, 2023 increased by $285.4 million when compared to 2022 primarily due to robust end-market demand for aggregates across all major geographies as well as concrete products and environmental equipment in North America.
Materials Processing 2024 2023 2022 % of Sales % of Sales % of Sales % Change in Reported Amounts 2024 vs 2023 ($ amounts in millions) Net sales $ 1,902 — $ 2,227 — $ 1,942 — (14.6) % Income from operations 252 13.2 % 359 16.1 % 298 15.3 % (29.8) % Net sales for the year ended December 31, 2024 decreased by $325 million when compared to 2023 primarily due to channel adjustments and lower end-market demand across certain product lines and geographies.
In addition, terms of our bank credit facilities and senior notes contain restrictions on our ability to make further borrowings and to sell substantial portions of our assets. 39 The Company’s material cash requirements include the following contractual and other obligations: Debt As of December 31, 2023, the Company had outstanding debt of $595.5 million, with $0.2 million payable within 12 months, exclusive of minimum lease payments for capital lease obligations and secured borrowings.
The Company’s material cash requirements include the following contractual and other obligations: Debt As of December 31, 2024, the Company had outstanding debt of $2,554 million, with no payment due within 12 months, exclusive of minimum lease payments for capital lease obligations and secured borrowings.
Other 2023 2022 2021 % Change in Reported Amounts 2023 vs 2022 ($ amounts in millions) Interest (expense), net of interest income $ (55.7) $ (46.3) $ (47.8) (20.3) % Loss on early extinguishment of debt — (0.3) (29.4) * Other income (expense) – net (1.1) (6.8) 13.0 83.8 % (Provision for) benefit from income taxes (63.0) (66.4) (46.3) 5.1 % Gain (loss) on disposition of discontinued operations – net of tax 1.3 (0.2) 3.4 * * Not a meaningful percentage Interest Expense, Net of Interest Income During the year ended December 31, 2023, interest expense, net of interest income, was $55.7 million or $9.4 million higher when compared to the same period in 2022 due primarily to an increase in receivable sales and higher interest rates, partially offset by higher interest income and no term loan interest in the current year period.
The decrease in operating loss is primarily due to lower compensation cost and the favorable changes in foreign exchange performance, partially offset by higher severance costs. 36 Other 2024 2023 2022 % Change in Reported Amounts 2024 vs 2023 ($ amounts in millions) Interest (expense), net of interest income $ (76) $ (56) $ (46) (35.7) % Other income (expense) – net (42) (1) (7) * (Provision for) benefit from income taxes (73) (63) (67) (15.9) % Gain (loss) on disposition of discontinued operations – net of tax — 1 — * * Not a meaningful percentage Interest Expense, Net of Interest Income During the year ended December 31, 2024, interest expense, net of interest income, was $76 million or $20 million higher when compared to 2023 primarily due to the issuance of additional debt to finance the ESG acquisition, partially offset by reduced borrowing from the revolving line of credit and higher interest income in the current year.
Consolidated 2023 2022 2021 % of Sales % of Sales % of Sales % Change in Reported Amounts 2023 vs 2022 ($ amounts in millions) Net sales $ 5,151.5 — $ 4,417.7 — $ 3,886.8 — 16.6 % Gross profit 1,176.6 22.8 % 871.2 19.7 % 757.4 19.5 % 35.1 % SG&A expenses 540.1 10.5 % 451.2 10.2 % 429.4 11.0 % 19.7 % Income from operations 636.5 12.4 % 420.0 9.5 % 328.0 8.4 % 51.5 % Net sales for the year ended December 31, 2023 increased $733.8 million when compared to 2022.
Consolidated 2024 2023 2022 % of Sales % of Sales % of Sales % Change in Reported Amounts 2024 vs 2023 ($ amounts in millions) Net sales $ 5,127 — $ 5,152 — $ 4,418 — (0.5) % Gross profit 1,068 20.8 % 1,177 22.8 % 871 19.7 % (9.3) % SG&A expenses 542 10.6 % 540 10.5 % 451 10.2 % 0.4 % Income from operations 526 10.3 % 637 12.4 % 420 9.5 % (17.4) % Net sales for the year ended December 31, 2024 decreased $25 million when compared to 2023 primarily due to lower end-market demand across certain product lines and geographies within MP, partially offset by sales generated from the newly acquired ESG business and increased demand for booms and telehandlers in North America.
We reported a liability of $6.4 million related to unrecognized tax benefits as of December 31, 2023 and do not expect this liability to change materially in 2024. As such, any related payments in 2024 should not be significant.
We reported a liability of $18 million related to unrecognized tax benefits as of December 31, 2024. We expect this liability to decrease approximately by $4 million due to payments related to expected effective audit settlement in 2025.
Our ability to access capital markets is also subject to our timely filing of periodic reports with the SEC.
Our ability to access capital markets is also subject to our timely filing of periodic reports with the SEC. In addition, terms of our bank credit facilities and senior notes contain restrictions on our ability to make further borrowings and to sell substantial portions of our assets.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS BUSINESS DESCRIPTION Terex is a global manufacturer of materials processing machinery and aerial work platforms. We design, build and support products used in maintenance, manufacturing, energy, recycling, minerals and materials management, and construction applications.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS BUSINESS DESCRIPTION Terex is a global industrial equipment manufacturer of materials processing machinery, waste and recycling solutions, mobile elevating work platforms (MEWPs), and equipment for the electric utility industry.
Income from operations for the year ended December 31, 2023 increased $60.8 million when compared to 2022 primarily due to incremental profit achieved on higher sales volume and improved manufacturing efficiencies, partially offset by SG&A cost increases. 32 Aerial Work Platforms 2023 2022 2021 % of Sales % of Sales % of Sales % Change in Reported Amounts 2023 vs 2022 ($ amounts in millions) Net sales $ 2,921.7 — $ 2,483.6 — $ 2,178.8 — 17.6 % Income from operations 371.3 12.7 % 196.2 7.9 % 152.1 7.0 % 89.2 % Net sales for the year ended December 31, 2023 increased $438.1 million when compared to 2022 primarily due to healthy demand for aerial work platforms in all major geographies and telehandlers and utility products in North America as well as improvements in the supply chain and price realization necessary to mitigate rising costs.
Income from operations for the year ended December 31, 2024 decreased $107 million when compared to 2023 primarily due to lower sales volume and unfavorable product and geographic mix as well as higher severance costs, partially offset by cost reductions. 35 Aerial Work Platforms 2024 2023 2022 % of Sales % of Sales % of Sales % Change in Reported Amounts 2024 vs 2023 ($ amounts in millions) Net sales $ 2,996 — $ 2,922 — $ 2,484 — 2.5 % Income from operations 342 11.4 % 371 12.7 % 196 7.9 % (7.8) % Net sales for the year ended December 31, 2024 increased $74 million when compared to 2023 primarily due to increased demand for booms and telehandlers in North America.
Income from operations for the year ended December 31, 2023 increased by $216.5 million when compared to 2022. The increase was primarily due to incremental profit achieved on higher sales volume, price realization, improved manufacturing efficiencies and cost reduction initiatives, partially offset by SG&A cost increases.
Income from operations for the year ended December 31, 2024 decreased by $111 million when compared to 2023 primarily due to the impact of lower sales volume, unfavorable absorption and mix, and higher severance costs, partially offset by cost reduction and lower compensation cost.
We returned over $100 million to shareholders for the second year in a row. In 2023, we returned $104 million to shareholders, including $61 million in share repurchases and $43 million in dividend payments. We continue to maintain ample liquidity and as of December 31, 2023, we had $971 million in available liquidity, with no near-term debt maturities.
We continued to maintain ample liquidity and as of December 31, 2024, we had $1,188 31 million in available liquidity, with no near-term debt maturities.
Loss on Early Extinguishment of Debt During the year ended December 31, 2023, there was no loss on early extinguishment of debt compared to a loss of $0.3 million in 2022 due to prepayment of term loans in the prior period. 33 Other Income (Expense) – Net Other income (expense) – net for the year ended December 31, 2023 was an expense of $1.1 million, compared to $6.8 million in the same period in 2022.
Other Income (Expense) – Net Other income (expense) – net for the year ended December 31, 2024 was an expense of $42 million, compared to $1 million in 2023.
However, it is important to realize we are operating in a challenging macroeconomic environment with many variables and geopolitical uncertainties, so results could change, negatively or positively. We expect EPS for 2024 of $6.85 to $7.25 on net sales of $5.1 to $5.3 billion.
We expect 2025 earnings per share of between [$4.70] and [$5.10] on lower legacy operating profit, partially offset by ESG accretion. It is important to realize we are operating in a challenging macroeconomic environment with many variables and geopolitical uncertainties, so results could change, negatively or positively. Our outlook excludes the potential impact of recently announced tariffs.
See Note N – “Litigation and Contingencies” in the Notes to Consolidated Financial Statements for further information regarding our guarantees.
See Note D - “Acquisitions and Dispositions” in our Consolidated Financial Statements for additional information regarding this transaction.
Our main sources of funding are cash generated from operations, including cash generated from the sale of receivables, loans from our bank credit facilities and funds raised in capital markets. We have no significant debt maturities until 2029 and we have increased our focus on free cash flow generation.
During the year ended December 31, 2024, our liquidity increased by approximately $217 million from December 31, 2023 primarily due to an increase in our revolving line of credit. Our main sources of funding are cash generated from operations, including cash generated from the sale of receivables, loans from our bank credit facilities and funds raised in capital markets.
All Terex team members contributed to our effort of continuing to provide products and services for our customers, while maintaining a safe working environment. We remain focused on executing our multi-year growth plan and continue to invest in new technologies and products across our businesses.
Overview Safety is a top priority, not only for our team members, but also our customers. All Terex team members contribute to our effort of continuing to provide products and services for our customers, while maintaining a safe working environment.
Cash used in investing activities was $114.4 million and $154.1 million for the years ended December 31, 2023 and 2022, respectively. The decrease in cash used in investing activities relates primarily to higher proceeds from the sale of capital assets and lower acquisition and investment activity, partially offset by higher capital expenditures in the current year.
The increase in cash used in investing activities relates primarily to the acquisition of ESG. Cash provided by financing activities was $1,837 million for the year ended December 31, 2024, compared to cash used in financing activities of $288 million for the year ended December 31, 2023.
Income Taxes – We estimate income taxes based on enacted tax laws in the various jurisdictions where we conduct business. We recognize deferred income tax assets and liabilities, which represent future tax benefits or obligations of our legal entities.
We recognize deferred income tax assets and liabilities, which represent future tax benefits or obligations of our legal entities. These deferred income tax balances arise from temporary differences due to divergent treatment of certain items for accounting and income tax purposes.
Our sales outlook incorporates the latest dialogue with our customers and our suppliers and our current supply chain expectations. ROIC ROIC and other Non-GAAP Measures (as calculated below) assist in showing how effectively we utilize capital invested in our operations.
ROIC ROIC and other Non-GAAP Measures (as calculated below) assist in showing how effectively we utilize capital invested in our operations. ROIC is determined by dividing the sum of NOPAT for each of the previous four quarters by the average of Debt less Cash and cash equivalents plus Stockholders’ equity for the previous five quarters.
See Note D - “Acquisitions and Dispositions” in our Consolidated Financial Statements for additional information regarding this transaction. During the year ended December 31, 2023, we repurchased 1,287,214 shares for $60.7 million leaving approximately $132 million available for repurchase under our share repurchase programs.
See Note J – “Long-Term Obligations” for additional details on financing transactions. During the year ended December 31, 2024, we repurchased 860,674 shares of common stock for $46 million leaving approximately $86 million available for repurchase under our share repurchase programs.
Our strategic operational priorities of execution, innovation and growth continue to strengthen our operations and allow us to capitalize on the strong demand in our end-markets. Our operations teams executed well during 2023, maintaining their focus on improving deliveries to our customers and continuing with cost reduction and productivity improvement initiatives.
We remain focused on executing our multi-year growth plan and continue to invest in new technologies and products across our businesses. Our strategic operational priorities of execution, innovation and growth continue to strengthen our operations and allow us to capitalize on the demand in our end-markets. The recently completed acquisition of ESG strengthens our portfolio.
We present non-GAAP financial measures in reporting our financial results to provide investors with additional analytical tools which we believe are useful in evaluating our operating results and the ongoing performance of our underlying businesses.
Management believes that presenting these non-GAAP financial measures provides investors with additional analytical tools which are useful in evaluating our operating results and the ongoing performance of our underlying businesses because they (i) provide meaningful supplemental information regarding financial performance by excluding impact of one-time items and other items affecting comparability between periods, (ii) permit investors to view performance using the same tools that management uses to budget, make operating and strategic decisions, and evaluate our core operating performance across periods, and (iii) otherwise provide supplemental information that may be useful to investors in evaluating our financial results.
The increase was primarily due to incremental profit achieved on higher sales volume, price realization, improved manufacturing efficiencies and cost reduction initiatives. SG&A expenses for the year ended December 31, 2023 increased $88.9 million when compared to 2022 primarily due to inflation, increased marketing, engineering, technology and incentive compensation expenses as well as incremental spend on new acquisitions.
SG&A expenses for the year ended December 31, 2024 increased $2 million when compared to 2023 primarily due to higher severance costs, technology expenses and a prior year facility sale gain, partially offset by lower compensation cost.
Removed
We continued our investment in technology and new product development, which are important to help enable us to take advantage of sustainability trends such as recycling, electrification and decarbonization. Company-wide investments in new product development and continued deployment of digital customer and dealer solutions are important to help deliver long-term growth.
Added
We design, build and support products used in maintenance, manufacturing, energy, waste and recycling, minerals and materials management, construction, and the entertainment industry. We provide lifecycle support to our customers through our global parts and services organization, and offer complementary digital solutions, designed to help our customers maximize their return on their investment.
Removed
Our permanent Mexico facility continues to advance on time and on budget. Our performance in 2023 reflected strong, global customer demand in our businesses and excellent execution by our team members in a dynamic and challenging environment. Net sales of $5.2 billion were up 17% year-over-year as end-markets remained strong.
Added
ESG adds a non-cyclical, financially accretive, and market-leading business to our portfolio with tangible synergies in the fast-growing waste and recycling end market. The implementation of the Terex Operating System (“TOS”) is an important part of our execution improvement journey. We are evaluating our global footprint, focusing on opportunities to reduce fixed costs while improving operating performance.
Removed
Gross margins increased by 310 basis points in the year as volume, pricing, improved manufacturing efficiencies and expense discipline helped to offset cost increases. Income from operations of $637 million was up 52% year-over-year. Operating margin of 12.4% was up 290 basis points compared to the prior year period.
Added
When it comes to innovation, we have a very exciting new product development pipeline focused on maximizing return on investment for our customers. We also continue to invest in robotics, automation, and digitizing workstreams to make our operations more efficient and more flexible.
Removed
Overall, 2023 financial performance demonstrated continued, strong execution and focus on delivering for our customers and dealers despite continued macroeconomic volatility and lingering supply chain constraints. Although supplier on-time delivery has improved, it remains below historical norms.
Added
This represents an important part of our roadmap to continuously become more competitive and more resilient regardless of market dynamics. Overall, 2024 financial performance demonstrated continued, strong execution and focus on delivering for our customers and dealers despite continued macroeconomic volatility resulting in the second highest full-year earnings per share performance in our history.
Removed
While our “hospital” inventory decreased from the prior year to $25 million at the end of 2023, we continue to face disruption, highlighting the challenges our team members continue to navigate and overcome.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

9 edited+2 added−2 removed12 unchanged
Biggest changeGovernment’s exclusion process, which has been extended through May 31, 2024, duty draw back and other mechanisms we continue to explore. If we are unable to recover a substantial portion of increased costs from our customers and suppliers or through duty draw back, our business or results of operations could be adversely affected.
Biggest changeIf we become unable to recover a substantial portion of any increased tariff related costs from our customers, suppliers, duty draw-back, or other available avenues, the imposition of the new or increased international tariffs could materially and adversely affect our business, financial condition and results of operations.
For further information on accounting related to derivative financial instruments, refer to Note I – “Derivative Financial Instruments” in our Consolidated Financial Statements. Foreign Exchange Risk Our products are sold in over 100 countries around the world. The reporting currency for our consolidated financial statements is the U.S. dollar.
For further information on accounting related to derivative financial instruments, refer to Note I – “Derivative Financial Instruments” in our Consolidated Financial Statements. 44 Foreign Exchange Risk Our products are sold in over 100 countries around the world. The reporting currency for our consolidated financial statements is the U.S. dollar.
Based on this sensitivity analysis, we have determined that an increase of 10% in our average floating interest rates at December 31, 2023 would not have materially increased interest expense during the year ended December 31, 2023. 42 Commodities Risk In the absence of labor strikes or other unusual circumstances, substantially all materials and components are normally available from multiple suppliers.
Based on this sensitivity analysis, we have determined that an increase of 10% in our average floating interest rates at December 31, 2024 would not have materially increased interest expense during the year ended December 31, 2024. Commodities Risk In the absence of labor strikes or other unusual circumstances, substantially all materials and components are normally available from multiple suppliers.
At December 31, 2023, we performed a sensitivity analysis on the impact that aggregate changes in the translation effect of foreign exchange rate changes would have on our operating income.
At December 31, 2024, we performed a sensitivity analysis on the impact that aggregate changes in the translation effect of foreign exchange rate changes would have on our operating income.
Based on this sensitivity analysis, we have determined that a change in the value of the U.S. dollar relative to other currencies by 10% to amounts already incorporated in the financial statements for the year ended December 31, 2023 would have had approximately a $50 million impact on the translation effect of foreign exchange rate changes already included in our reported operating income for the period ended December 31, 2023.
Based on this sensitivity analysis, we have determined that a strengthening or weakening of the U.S. dollar relative to other currencies by 10% to amounts already incorporated in the financial statements for the year ended December 31, 2024 would have had approximately a $37 million impact on the translation effect of foreign exchange rate changes already included in our reported operating income for the period ended December 31, 2024.
At December 31, 2023, less than 1% of our debt was floating rate debt and the weighted average interest rate of our total debt was 4.15%. At December 31, 2023, we performed a sensitivity analysis for our financial instruments that have interest rate risk. We calculated the pretax earnings effect on our interest sensitive instruments.
At December 31, 2024, 47.6% of our debt was floating rate debt and the weighted average interest rate of our total debt was 5.79%. At December 31, 2024, we performed a sensitivity analysis for our financial instruments that have interest rate risk. We calculated the pretax earnings effect on our interest sensitive instruments.
We actively manage our material sourcing, and employ various methods to limit risk associated with commodity cost fluctuations and availability. While the overall continuity of material supply into our manufacturing operations has improved from the prior year, we continue to experience intermittent disruptions with certain material types, most notably electronic components.
We actively manage our material sourcing, and employ various methods to limit risk associated with commodity cost fluctuations and availability. The overall continuity of material supply into our manufacturing operations has improved from the prior year.
We have designed and implemented plans to mitigate the impact of these risks by using alternate suppliers, expanding our supply base globally, leveraging our overall purchasing volumes to obtain favorable pricing and quantities, developing a closer working relationship with key suppliers and purchasing hedging instruments to partially offset anticipated exposures.
We have designed and implemented plans to mitigate the impact of these risks by using alternate suppliers, expanding our supply base globally, leveraging our overall purchasing volumes to obtain favorable pricing and quantities, developing a closer working relationship with key suppliers and purchasing hedging instruments to partially offset anticipated exposures. 45 Principal materials and components used in our various manufacturing processes include steel, castings, engines, tires, hydraulics, cylinders, drive trains, cab chassis, electric controls and motors, semiconductors, and a variety of other commodities and fabricated or manufactured items.
Additionally, import of certain purchased components and parts may be impacted by the implications of sanctions preventing the use of iron and steel from Russia in such components and parts. Tariffs on certain Chinese origin goods continue to put pressure on input costs, which we have been able to partially mitigate through the U.S.
Inflationary pressure on certain purchased components have continued while the cost of U.S. steel has declined throughout 2024. Additionally, import of certain purchased components and parts may be impacted by the implications of sanctions preventing the use of iron and steel from Russia in such components and parts.
Removed
However, we anticipate that we will continue to be affected by intermittent material shortages and production delays into 2024, though the extent of these disruptions has eased.
Added
The U.S. government has imposed tariffs on certain foreign goods from a variety of countries and regions that it perceives as engaging in unfair trade practices.
Removed
Principal materials and components used in our various manufacturing processes include steel, castings, engines, tires, hydraulics, cylinders, drive trains, electric controls and motors, semiconductors, and a variety of other commodities and fabricated or manufactured items. Inflationary pressure on certain purchased components have continued while the cost of U.S. steel increased in the latter part of 2023.
Added
Tariffs on certain foreign origin goods continue to put pressure on input costs, which we have been able to mitigate some effects of tariffs through the U.S. government’s duty draw-back mechanism, tariff exclusion process, footprint utilization, and prudent sourcing.

Other TEX 10-K year-over-year comparisons