Manitou lifts sales target, despite ag slowdown

Manitou raised its forecast for full-year sales as a strong performance in construction outweighed the impact of a slowdown in agricultural sales, which prompted the group to cut production in the sector.

The French based group said it was expected sales of about 5% for 2014, compared with the previous forecast of "stable" takings.

And it raised to 2.8-3.3% its forecast for operating income margin for the full year, compared with 1.8% last year, and a previous forecast of 2.3-2.8%.

The upgrades came as Manitou reported a 9.8% increase to E350.6m in revenues for the April-to-June quarter, up from the 7.2% growth rated reported in the first three months of the year.

'Weak and uncertain demand'

The acceleration came despite weakness in the agriculture sector as Manitou, like other farm machinery manufacturers, confronted the dent to farm investment programmes from lower crop prices.

"The agriculture business was faced with weak and uncertain demand," Manitou said, adding that this had prompted it to make a "downward adjustment" in its production of farm vehicles.

Manitou is best known in agriculture for its telehandlers, used for the likes of shifting bales or grain, although its forklifts are also popular for farm uses, such as stacking potato crates.

And Michel Denis, the Manitou chief executive, foresaw further weakness in agriculture ahead, saying that "the agriculture business as a whole recorded a slowdown in order intake, the impact of which should be felt in the second half".

'Especially strong growth'

However, Manitou achieved particular growth in construction, where it "benefitted from the continued strong demand of rental companies, as well as the strong performance of the telescopic forklift truck and aerial work platform ranges",

Business was notably busy in the UK, "where there was a recovery with especially strong growth".

Overall sales of the rough terrain handling division, Manitou's biggest business, which includes the telehandlers, rose 10.8% to E248.3m despite the agriculture slowdown.

The figures were released after the close of Paris markets, where Manitou shares close down 0.3% at E11.61 on Wednesday, not far above 10-month lows.

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