Improved spending from chains and the impact of internal reorganisation helped nudge Manitowoc’s foodservice equipment sales up 5% last quarter, as the business prepares to be hived off from its parent company in the coming weeks.
Manitowoc admits that “recent weakness in the credit markets” has put pressure on its timeline for the spin-off, but said that it continues to target completion of the exercise in the first quarter of 2016. Its sister crane business is also being separated as part of the move, which has been planned for more than a year.
Fourth quarter 2015 net sales for the Foodservice business hit $392m (£271m), with continued strength in cold-side products and KitchenCare cited as the primary growth drivers. “Hot-side sales are recovering and large-chain spending is firming,” the company stated.
Foodservice operating earnings for the fourth quarter of 2015 reached $73m (£51m) versus $48m (£33m) for the fourth quarter of 2014, producing an operating margin of 18.6% compared to 12.9% the year before. The improvement was driven largely by the impact of the cost-saving initiatives, product line simplification and stronger KitchenCare results, the company said.
For the full year, Foodservice revenues were stable at $1.6 billion ( billion), operating earnings inched up 2% to $240m (£166m), while operating margin increased to 15.3% compared to 14.8% in the prior year.
“We are pleased with the improved performance in Foodservice,” declared Hubertus Muehlhaeuser, president and CEO of Manitowoc Foodservice. “During the quarter, we delivered improved financial results driven by the actions we’ve taken over the past twelve months, as well as the announced initiatives to simplify and right-size our business.”