Boost in Q3 revenues and profit for Hyster-Yale
Hyster-Yale Materials Handling, Inc has reported that third-quarter 2023 lift truck revenues increased 19% to $1001.2 million over 2022 the same period in 2022 while consolidated unit shipments increased 5% to 25,700. Revenue growth was led by a significant increase in Americas unit and parts volumes combined with the favourable effect of previously implemented price increases in all regions. A favourable sales mix shift, mainly to higher-priced, higher-capacity Class 4 and Class 5 trucks, and favourable foreign currency movements, primarily in EMEA, also contributed to the revenue growth.
Unit shipments decreased 7% from the previous quarter largely due to fewer Americas and EMEA shipments as a result of seasonal plant shutdowns. While supplier constraints have largely dissipated over the past year, the business was negatively affected by a modest number of critical component supply issues in the third quarter. Also, continued skilled labour shortages impeded progress on planned production rate increases and shipments during the quarter.
Third-quarter 2023 lift truck operating profit increased substantially over the prior year to $58.6 million, resulting in a 6.8% operating profit margin. This year-over-year increase generated a 52% incremental margin for the quarter. Product margins increased significantly in all geographies due to favourable price-to-cost ratios and improved sales mix. Favourable currency movements also contributed to the higher profit. Higher employee-related expenses, product liability and warranty costs partly offset the profit improvement.
The company’s third-quarter results were significantly ahead of the expectations provided in the second-quarter earnings release. Better-than-expected product margins, higher parts sales and lower operating expenses drove the improved profit.
Geographically, the Americas’ third-quarter 2023 revenues increased by $145.2 million, or 25%, while operating profit improved by $64.5 million compared with third-quarter 2022. Improved product margins on higher volumes and a favourable sales mix more than offset increased employee-related, product development and product liability expenses.
EMEA reported a $24.5 million, or 15%, revenue increase and operating profit of $2.4 million in third-quarter 2023 compared with a substantial loss in 2022. Price increase benefits and favourable currency movements more than offset the effect of lower unit and parts volumes and elevated operating expenses. New product launch issues and component parts shortages continued to constrain production and shipment levels during the third quarter, particularly in the Nijmegen, Netherlands facility.
JAPIC’s third-quarter 2023 gross profit improved over the prior year due to a favourable sales mix and lower material and freight costs. These improvements more than offset higher manufacturing costs and the effect of lower unit volumes. JAPIC revenue and shipments decreased year-over-year largely due to strong prior-year shipments combined with unfavourable 2023 lead times on products sourced from other regions. Operating results improved modestly over 2022 as increased gross profit was mostly offset by higher operating expenses.