You can sit right here. No, sit right here. How about that? Okay. Great. Thank you all for joining. Good morning, everyone. My name is Stanley Elliott. I'm an analyst here at Stifel, covering the machinery and construction materials groups. Very happy to have Terex Corporation with us here today to talk about their business and give some updates. With us from the company, we have Julie Beck, Chief Financial Officer. Julie, welcome. Thank you. Thanks for having us. Yeah, no, this is, this is great. So I guess for starters, maybe you- Do you want me to walk through the slides? Well, there's probably some people who are unfamiliar- Okay with the company. Maybe kind of go through a couple of the slides. Sure you wanna talk about, and then we can, we can go from there. Is that okay, or do you wanna... Okay. Absolutely. All right. I appreciate it. So let me just tell you a little bit about Terex, and thanks to everybody for your interest, and thanks for being here. I'm really excited to be here on behalf of all the Terex team members. It's a great team, and it's really fun to tell the story. So we have our forward-looking statements, our usual statements from our legal team, and then we always start talking about Terex. We talk about safety. Safety is the most important thing that we do, and so we have, you know, keeping each other safe and Zero Harm is our goal, and we see some improvements in our safety trends, and we're proud of that. Our Terex Way values have been in place for, you know, close to 20 years now, and they're they guide how we perform and how we act, and we're very proud of them. I'm particularly proud of one of them, that's servant leadership, and I don't know that I've ever seen servant leadership except at Terex. We are number one or number two in almost all of the markets that we serve, and we are a $5 billion business in a $34 billion addressable market. So we have the opportunity to grow organically in the existing markets that we serve. You know, we invest in innovation, and we have about 20% of our sales each and every year due to new products introduced in the last three years, and so we have a nice vitality index. We operate in two segments, the Materials Processing segment and the Aerial Work Platforms segment. So, very pleased about that. I'm gonna go relatively quick through this, Stan, so we can get into questions. We had a really strong start to the year, and we were able to raise our outlook for the year after the end of the first quarter. You know, we had sales up 5%, you know, operating profits up 7%, you know, 20 basis point margin improvement in the first quarter, and we're generating almost a 28% return on invested capital. So a really nice story. And so, you know, we started a journey, Stan, and we're gonna talk about some of the journey from, you know, Terex. And you know, we started in 2015 to really take a look at our portfolio and our former CEO, and you know, went through and analyzed all of our businesses and kept all of the businesses that outearned its cost to capital. And so what we did is... I'll show you in the next chart. We sold multiple businesses. We used that cash to pay down and buy shares, and so we invested $1.7 billion in share repurchases and reduced our share count by 38%. Over this time, you can see the, you know, the 700 or so basis point improvement in operating margins over the period of time. You can see that we grew earnings per share by over 5x at a 25% CAGR, and of course, return on invested capital by, you know, almost 2,200 points. So it's a really, really nice story. So that leaves us poised with a really nice, strong balance sheet going forward. And so it gives us optionality. And so these are some of the different things that we did throughout time. You know, our strategy now is, you know, execute, innovate, and grow. And we're focusing on those areas and businesses that outearn their cost of capital and have the highest growth potential. And of course, we've also capitalized on operating systems and process improvements as well. One thing that I wanna talk about is I love to talk about the Materials Processing segment, and if you look at the Materials Processing segment over time, you can see that really nice performance. In 2016, it had a 9% operating margin. Now, in 2023, it had a 16% operating margins and had double-digit sales CAGR, 18% OP CAGR, and it represents, you know, about 60% of our operating profit in these years. And so, a really important piece of our company that I, you know, I would love to talk about, and so I know we'll talk about that a bit later. When we think about our 2024 outlook, you know, it remains overall robust. We see continued strength in our infrastructure and utilities business. We still see strong manufacturing spending, particularly in North America, and of course, recycling and environmental markets are strong. We do see some mixture of things. You know, the U.S. market certainly is stronger than the European market. And so we have seen some softness in Europe. We've seen some softness in scrap markets, like scrap steel, which has impacted our Fuchs business, part of our materials handling business. We also have seen some, you know, weakness in economic growth in Europe impacting the construction market. Of course, commercial in all markets is constrained, office building and those types of things. Our products are not much tied to those things. We're much more tied to the utilities markets, the manufacturing growth, and those other components that are part of the non-residential construction, as we look at the business, you know, we're well positioned to benefit from the mega trends, things like digital digitalization, data centers. You know, there are folks that are talking about artificial intelligence, as you know, the need to expand the grid to support artificial intelligence as well as data centers. We see infrastructure investments, you know, amounting to, you know, $1.2 trillion over the next 10 years. And so we see that the opportunities for us in roads, and bridges, and airports, and railways, and the power grid there. Electrification, of course, the same there. The electric grid needs to be hardened to support our net zero goals. And so we see lots of opportunity there, and of course, in Waste and Recycling, which is a relatively new business for us. And so that business was started by taking our MP business and taking products that were made for other end market usages and making them available and systems available Waste and Recycling business. and so there's some nice things there that we can talk about as well. So we see that, you know, the government investment, particularly in the United States, that that builds momentum for us going forward into the future and opportunity for us to grow. We have the strong balance sheet. You know, we're levered at, you know, 0.5x. That leverage is down, you know, significantly from 3.5x, a 74% reduction in net debt. Again, I talked about the share repurchases. You know, we've used, you know, cash proceeds to buy back shares, and we have an active share repurchase program now. And, you know, we have ample liquidity going forward, and we have some nice free cash flow. We've generated some nice free cash flow and expect to continue that going forward. And so that strong balance sheet gives us some optionality moving forward and flexibility. And so I would say that, you know, we had an Investor Day in at the end of 2022, December of 2022, and this positioned us well. You know, we're well on target, you know, to exceed and to do well in our Investor Day targets. We're ahead so far, you know, for the first 18 months or so since we came out with those targets. And so that is really the overview that I was going to share. Per- perfect. Stan, I turn it over to you. Thank you. Julie, Thanks, and. That's great help getting people up to speed, because I do think that there's been so much change at the company. I think it probably goes underappreciated in many instances. I guess one thing I'll start with is since the last time you guys were here at CSI, you've had a change at the C level, and the CEO, John Garrison, retired. Simon Meester now, who'd been with Terex for a long period of time- Mm-hmm. ... we're nearly maybe a half year into the change. What, what do you think investors would notice with this, with this transition? Yeah, so John Garrison did all of those charts that I showed you before and positioned the company and, you know, improved our financial performance and our balance sheet, you know, really well, a lot of fixing and invested in some of our facilities and operational excellence and those things. So now we're poised for growth. And so we have the ability to grow both organically, as I mentioned, and we would have the opportunity to grow inorganically as well. So, you know, that's a really exciting time, exciting time to be at Terex because of that. And on the M&A front, you know, talk about kind of things you're looking at. You have a lot of capacity out there. How should investors think about the... Is it adjacencies? I mean, you have got a nice market structure within your markets because you have a very wide kind of field to play with. Yeah. So we have an active pipeline in M&A, and so we would be looking at things that, anything that would strengthen our moat, if you will, and make Terex a stronger company. We're not really interested in buying a fixer-upper. We'd like to buy a business that has a strong management team. We're interested in items that would supplement and grow in our Materials Processing segment. We're interested in environmental, we're interested in our utilities business, we're interested in those where we can see a growth. But, I... You know, as the finance person, you know, we need to, you know, we will remain disciplined. You know, it has to be our, a business that outearns its cost of capital. It would be nice to make sure that anything that we invest in could reduce our cyclicality, and or the perception of cyclicality. And we'd also like to you know make sure that any business is financially attractive. And we have to evaluate any acquisition at the time, you know, against other uses of capital and see what the best use of capital is. So we have an active pipeline, but we will remain disciplined. Help us with from a size standpoint, right? You guys have targeted 2.5x leverage. Mm-hmm. You just mentioned your, you know, half turn, and it, you know, obviously, is gonna continue to wind down as we're generating cash this year and into next. Are you looking more for bolt-on type deals or any sort of help with the sizing there would be great? Yeah, I think that, you know, we could see ourselves doing, you know, bolt-ons, and, you know, for it. Definitely, and you know, you could look at something that might be a bit larger that could be considered more transformational. Again, if it really satisfies all the criteria that we talked about before. And there are fewer of those opportunities out there. Yeah. Yeah. ... And, you know, the whole dampening the cyclicality piece, I think is an interesting comment. I think for the longest time, investors in Terex, they only wanted to talk about kind of the AWP business, and now you have a much larger, inherently more stable part of the portfolio driving a lot of cash, driving a lot of more robust margin stability. I think. You mentioned the Waste and Recycle- You mentioned the- I appreciate it. We appreciate being able to talk about MP in that way. Yeah. Well, so, Waste and Recycling business, right? i mean, it's the basis you took, got a legacy crushing screening equipment and converted it into the waste part of the market. How do you see that part, the waste recycling component of that business continue to, to grow, given it's, you're relatively smaller versus some of the others? Yeah. And so, you know, yeah, great job by our Materials Processing segment in taking existing products, and so I'm gonna give you a few examples. If you think about aggregates business, and you think about crushing and screening, one of the things that we're number one in the mobile crushing and screening business. So most of the time, when you think about big aggregates, you think about either a mining application or a quarry. We're not really in mining. We're in the quarries, but we're also in this mobile crushing and screening business. And so what that means is that we can take a crushing and screening machine, a mobile one, and put it, a crusher, right next to a site. If you're demolishing a building, for example, we can put that machine right next to it. We can crush, sort, wash that debris, and then it can be sorted into streams, and we can reuse it right at the site. So instead of hauling all this stuff away, debris into a landfill somewhere, you're able to process it there and reuse it on site. So that's one nice example. We're also involved in vegetation management. We announced a new business in Green-Tec, where we're using some of our chip crushers, as well as our material handlers for vegetation systems going forward. And we also feature municipal waste. We have for our municipality in the U.K., we have a system that's taking that municipal waste, that's sorting it, okay, into the various value streams, so that municipality can take things and reuse it for scrap, and it's lucrative for them, and it's dealing with municipal waste. We bought ZenRobotics, which was a smaller company that sorts all of this municipal waste. It's software, and it helps sort it. And, you know, humans don't wanna do that kind of work, right? And so you get a value stream that's helpful, not only from a recycling perspective and from an environmental perspective, but also helpful revenue stream for municipalities as well. So it's a really nice story, and I really wanna applaud the MP team, and I think that business continues to grow with more and more applications as society, you know, wants those solutions as well. Yeah, that the ZenRobotics piece, essentially, I saw it at a waste expo earlier this year, and, you know, the amount of cost you've been able to take out of the systems- Mm-hmm. You know, the visuals and the camera and really the artificial intelligence you've been able to put into those systems. Mm-hmm ... to be able to sorting is a pretty fantastic story. You know, one thing that we've seen, so we also follow a lot of construction material companies. Their aggregate volumes have not been very, they did fine, but they're not really robust. Yet, your MP business in that part continues to do quite well. I think it speaks to what you're seeing with this kind of secular adoption in terms of the mobile crushing piece of it. Mm-hmm. Yep. On the margin piece for the MP business, it's been nice and generally pretty stable with how... What are some of the drivers, I guess? Is that more parts? Is that more just larger items? Is it kinda how it goes to market? Help us with that, if you wouldn't mind. With the MP business? Yeah. Yeah, I mean- Just on the margin side. On the margin side. So, you know, the team, you know, has, you know, they've been very, very good at developing new products and introducing innovation into the marketplace. They've also invested in a robust operating system that helps manage, and they've been really great in terms of re-engineering, you know, taking cost out and those types of things as well. So all of those things, the MP business pretty much has historically been a book to build business, except during the pandemic, when you know, supply chain disruption impacted all of us. And so what happens with that business is they also are pretty much customizing virtually every order. And so they. You would book it in one quarter, you'd make it and ship it in the next quarter, so they can dynamically price, and they were able to address the supply chain price you know, increases along the way, you know, well as well. And so new applications, new products, you know, good blocking and tackling, good manufacturing performance, and you know, and disciplined cost and price management. All of those things. What's the margin then? So the then? So the margins are, you know, in 2023 were about 16%. Mm-hmm. And they were, you know, they were like, you know, 7% or 8%, you know, when we started the journey. So they've improved dramatically. Significant. Can you call that a little bit? Yeah, so we talked about, we talked about in, in the Investor Day, you know, that those, you know, increasing like, you know, 16.5 or so in that, in that range, you know, because the, we, we're investing in that business right now. Uh-huh? ... and let's, I guess, let's switch gears, and let's do talk about the AWP business a little bit. Mm-hmm. Right? You know, a lot of investor focus. You help us with the demand and outlook. It you know, the conversations that we hear from some of the rental companies continues to be encouraging in terms of looking at the number of government projects, all of the stimulus work coming down the pipe, kind of the migration to electrification and hybrids within that business. You know, help us with some of the things you all have done structurally to take some of the cyclicality, take some of the costs out of that business, because there's been a lot going on there as well. Okay. So we'll talk about the Genie business- Yeah ... first, as part of AWP, 'cause we have the Genie and the utilities business that are part of AWP. So, Genie has, you know, taken, you know, significant cost out of the business over the last several years. You know, we started out with, you know, about a $90 million reduction that took place, you know, in 2021. They've continued to work on cost out actions, and they would cumulatively say that they're, you know, they're around the $200 million mark in cost reductions. But in addition, in engineering redesigns and things like that, but in addition, what we've really tried to do is work on our cost structure and move more of our cost to a variable cost structure from a fixed cost structure, as well as we have opened up a new plant in Monterrey, Mexico. So what we've done is we have taken higher cost North Amer- or, you know, US capacity offline in Oklahoma City and Rock Hill, South Carolina, and putting a plant in Monterrey, Mexico. We're probably 75%-80% or so complete with that project right now. We have 700-800 people working in that facility. We've launched a new line of telehandlers in that product line, and we continue to move things and reposition ourselves in Monterrey, which is when you take into account the lower labor, the lower supply chain, the lower overhead costs in that facility. We've talked about a 200 basis point margin enhancement because of that plant. So we brought that plant up. We took capacity off. It wasn't to build capacity, it was to... It was done for cost-competitive reasons. And so we think that, you know, we have really materially improved the Genie business, you know, going forward. And then, on the utility part of the market, I mean, you guys have expanded to South Dakota as well. Mm-hmm. There should be some nice tailwinds, well, we think there will be, with just the electrification and grid work that needs to be done to support everything. How are you all positioned within that part of the market? Yeah, so we're really excited about the utilities business. You know, we had a new plant in Watertown, South Dakota. We had about 11 production little facility shacks, really, around Watertown, and we built a new facility. It's a beautiful facility. It opened in April of 2020, so not the best of timing in terms of pandemic. But you know, that facility is a beautiful facility, and with the demands for the infrastructure grid in the United States alone, that business should provide some nice growth going forward. We're very excited about that. Some people say the grid needs to expand 3x. Sometimes they say it's, it needs to expand 300x. Somewhere in there is probably the truth of, of what it is, but that means nice demand for our utilities product. And, and what we're doing is we, we provide the fiberglass insulated bucket trucks, so- Mm-hmm ... so line people can work safely at heights. Mm-hmm. And so, you know, we have potential to grow there. That business has been impacted the most of any of our businesses during the pandemic and supply chain. So we've had shortages of chassis, and we have shortages of bodies. And so for the big trucks that we put together, for independent utility companies or even municipalities, you know, that has been hampered the most by supply chain constraints. So we still have opportunities for improvement, for efficiencies in the factory, you know, as we get more consistent supply and can get things, you know, more through the system. But we're really bullish on that business and think that's a great opportunity of growth for us. You know, in terms of supply chain, you know, there's a lot of discussion at one point around hospital inventory. I think a lot of that's gone, thankfully. But, you know, the parts and services component is something that's very interesting opportunity set for you all as you continue to build out, you know, the MP business, you know, field techs, even with the AWP business. How are you gonna go about addressing that part of the market? I think at the Analyst Day, you talked about, like, a $2.5 billion sort of a Yeah ... addressable opportunity. Yeah. So, you know, we certainly have invested a lot in digital applications and, you know, making it easy to do business with us and making it easy for providing information to our customers of analytics that tell you when you need to replace something, you know, ahead of time, and, and being the supplier of choice, you know, and from a service perspective, so that people buy, you know, genuine Genie parts. So, there certainly has been an initiative, you know, to improve our parts and service and grow our parts and service business. And we continue to work on all of those right things to gain more of that marketplace. Go back a couple of the slides you showed. It was on the free cash flow profile. The business has improved dramatically, I think. Some of that probably was delays with COVID, et cetera, but there's been some material change. I think there have been changes as well. Help us with, you know, how this free cash flow has improved, the sustainability of these sorts of conversions as we think on the next level, 'cause I think that also ties into the M&A bucket, as well as the capital allocation bucket down the road. Yeah, so, you know, we, well, we have generated, you know, improved free cash flow, you know, over the last several years, you know, significantly. And, you know, part of that, you know, there's operating income is, of course, the first part of that. And we are in the third year of our Monterrey facility expansion and build, and that's the final year. And so when we think about what we wanna invest in capital expenditures, in our Investor Day, we talked about 1.5%-3% of our sales being. We're at 2.7%. We're on that high range for this year. But this is the last year of big investment in Monterrey. So we would expect free cash flow to improve going forward. And as that tails off, and you know, we would expect, you know, 1.5%, you know, the low end to be, you know, more of like that maintenance CapEx, you know, number going forward. And you know, and then, but of course, I don't wanna say we're not gonna invest in capital because we do, and we've been able to, you know, generate a, you know, that 28% return on invested capital that we talked about, you know, earlier, so. And help us with kind of the capital allocation piece, right? I mean, there's. You've got the M&A bucket. You know, there's a lot of flexibility here within the model. How should we see this evolving, you know, over time? Yeah, so I would, you know, I would say that, you know, over the last couple of years, you know, we've returned in excess of $100 million to our shareholders each year. You know, we returned, you know, about 28% of our free cash flow last year to our shareholders in that range. We increased the dividend by 31% last year. And then, of course, we have, you know, roughly $130 million left on our share repurchase. So, with everything we do and every capital decision we would make, you know, we would compare the rates of returns from buying our stock versus capital, you know, inorganic or capital needs of the business, CapEx needs, as well as inorganic. We're kind of getting close to winding down time, but, you know, sticking on kind of the growth topic, you know, India has been a new area of investment- Mm-hmm ... for you. Kinda help us with kind of the market size, the addressable part of the market on the pick-and-carry part of the business. So, you know, the pick and carry crane, we have a really nice pick and carry crane business that's based in Australia. It's called Franna. And what we have done is we have redesigned the product for the India market, and we're producing it in India. You know, we're just starting to manufacture it in India. We're getting the supply chain stood up. We have the capacity within our facilities and, you know, in India to build it there. And you know, India is the largest pick and carry crane market in the world. So we have a nice product that's being introduced, so we think that that provides some nice growth for us. But we're very bullish on India. We're bullish on infrastructure in India. We're bullish on adoption of aerials in India, and so we think that India provides a nice opportunity for us going forward. I guess one more, since we'll sneak one in. You know, talk about kind of what's going on with some of the hybrid technologies that you all have coming out in the marketplace. Yeah. So, you know, we've invested, you know, a lot in electrification. So we have like the first ever all electric, you know, bucket truck for utilities, and so. And we have PTO technology, and we do that. You know, 70% of our products are offered in electric options. So you see in our Genie side, that hybrid is becoming, you know, quite popular, and you see more adoption. Not everybody wants an electric option, you know. Not everybody does on the Genie side yet, but we have, we've invested, we made an investment in a company for on battery technology. And, you know, even testing batteries and having latest battery design is something that we're investing in so that we remain in the forefront of electrification going forward. We think about the MP, and we think about the aggregates business, you know, those two, we have electric options in those, but they're... You know, if you think about a construction site, like the mobile crushing and screening in some of these, you know, oftentimes there would be a diesel generator or something running this. So, you know, the adoption isn't quite as great in the MP business, but certainly we have, you know, we believe that we lead, you know, in the Genie and utility business and in MP as well in electrification, and we wanna continue to invest in that going forward. Perfect. Well, Julie, that is it. We are out of time, so thank you very much for joining us. Thank you so much. I sure appreciate it. ... for having me, and thank you all for your interest in Terex. Appreciate it. Mm-hmm.