Terex Corporation (TEX) Earnings Call Transcript & Summary

Welcome, everyone, to this session with Terex Corporation. It is my pleasure to host CFO, Julie Beck; and Head of Investor Relations, Paretosh Misra. I'll pass it on to Julie to start off the presentation.

Okay. Thanks, Tami, and welcome, everyone, and thanks for your interest in Terex. So I'm really excited to tell you about our company. We have a lot of great things going on. So we start off with our forward-looking statements. So please, we will present forward language, and so we have our disclaimer right there. So our General Counsel is happy that we have that in there. So thanks. And then we move forward to -- we start every meeting at Terex with safety. Zero harm is our goal, and it's our responsibility to keep -- probably our greatest responsibility keeping each other safe. And so we have a target and you'll see that we've had some nice progress on our total recordable incident rate over time. In 2022, we had a spike, and that's because of all of the supply chain disruption. And all of the movement, when you bring something into a factory, move it off the floor and move it back again, it causes -- it's not a standard process, and it causes disruption and has caused a spike in our incident rate. Nevertheless, we have a target that we've announced in 2024 to get down to 1. And of course, our ultimate target is to be at 0 harm. One of the most important foundations of Terex is our Terex Way Values. And it supports a strong company culture, and we're very proud of those values and those values have been placed for many years. And we operate -- and we expect our team members and everyone to operate under the Terex Way Values. And again, we're very proud that, that's how we live and operate in our culture at our company. Moving forward, we had a nice year in 2022, and we have -- we delivered on our strategy. Our strategy is to execute, innovate and grow. And so when I look at 2022 and reflect back, we had a nice year of proactively managing the supply chain and all of the disruption. We did a lot of things that I'm sure we'll talk about in terms of mitigating cost inflation and working with our customers, and we had strong execution that's led to some nice improved financial results. We continue to manage our expenses and our SG&A was down at 10.2% of sales for the year, and we continue to progress on our Genie Mexico which is very important to our strategy. And that facility is on time and on budget. We also continue to invest in new products on a company-wide basis. We'll be at the CONEXPO in a few days -- that there today. And Paretosh and I will join the group tomorrow, and you'll see more products at CONEXPO as well. We've launched our first ever in the industry, all-electric utility bucket truck, and we're very proud to be the industry leader in that. We also have lots of electric options. We have 70% of our Genie portfolio is offered in electric options and 60% of our MP business. We also introduced a lithium-ion battery option for our slab scissors this year. So we continue to invest in that electrification. And we continue to invest in digital solutions to support our customers, to improve our parts and services revenues and we invest in digital technologies to do that. We are growing. And so we did -- we acquired ProAll, which was a concrete product offering. It's volumetric mixers. And the unique part of a volumetric mixer is that you mix the concrete on site. So a typical concrete truck would go to a concrete facility, the concrete will be poured and there would be a certain amount of time that it takes to get from that factory to the site and you have to pour that concrete quickly. In this product, you can mix it at site. And so it's very, very, very great, especially for road repairs, it could happen quicker. And we're excited about the introduction of ProAll to our portfolio. We've also invested -- made some equity investments in Acculon Energy and Viatec. But those investments are really engineering investments to accelerate our capabilities in new product development. Acculon, specifically in battery technology and Viatec provided the PTO or pay take-off technology to support our first all-electric utility bucket truck. We also acquired a Northern Ireland facility that made large fabrications to expand our capacity and support our factories, including our aggregates business in Northern Ireland. And finally, we made an investment in ZenRobotics, which has software that enhances pick and sort technology for the environmental and recycling business. So very exciting progress on all of those. And of course, as the CFO, that resulted in some nice strong results and improvement in 2022 over 2021 with sales up of $4.4 billion or 14%. Earnings per share up 41% year-over-year. We returned $132 million to shareholders via dividends and share repurchases, and we produced a return on invested capital of 21.3%. And when we talk about EPS of $4.32, that's GAAP earnings. There are no adjustments in that. And so we always report GAAP earnings, and we're proud of the real earnings and the return on invested capital, which is well ahead of our cost of capital, of course. So when we look at how we want to grow the business, we think we have -- it's a really exciting time for Terex. We have lots of organic growth opportunities. And so we want to capitalize on the mega trends, number one. So we think about sustainability. We think about things like infrastructure investments. The rest of the world has invested in infrastructure in the United States. We finally passed an infrastructure bill, the first in many years. We also are -- have goals for zero harm and electrification needs. And our businesses support that as well. And we're capturing growth in a circular economy. We want to continue to grow our MP segment. We love our MP segment. Our MP segment represents 60% our operating profits. And we want to develop new products in adjacent categories and markets. We want to leverage our dealer relationships. Our dealers 75% of our sales go through MP dealers. And those relationships are very strong. And so we have many 20-year-plus year relationships with many of our distributors, and that's -- they service our customers well and we go to market with our -- for our customers with our dealers and specific applications. And of course, we want to continue to invest in innovation in that business. And there's plenty of opportunity to do that, and we're doing that as well. And so for Genie business, we want to optimize Genie through the cycle. We want to make sure that we have through cycle -- excuse me, margin improvement. We want to see continuous margin expansion in that business as well as top line growth. And we will continue our cost discipline, not only at Genie but across the rest of the businesses as well. And of course, our Utilities business is a fantastic business as we think about maximizing our -- we invested in a new facility in Watertown, South Dakota that came online in 2020. So we have capacity to grow this business. We're growing in North America. We have the opportunity to expand internationally. And of course, with all the electrification trends, our utilities products support that in a major way. And we can -- as we need to grow the grid to support our net-zero goals as a society, the utilities business can capture on that growth. And we're leading through innovation. Again, the first all-electric utility bucket truck as well. And then, of course, in parts and services, I already mentioned that we're investing in digital and those capabilities. We're investing in customer experiences. We're providing statistics for preventive maintenance and things like that and uptime for our customers. And we're investing in our service capabilities and service centers that have opened up several service centers over the past year to 18 months, 12 to 18 months. So we believe that we are well positioned and we have multiple avenues for growth organically at Terex and to take advantage of all of this. And so we talked about the megatrends. And so here are some of the trends. When you think about the world going digital, okay, that we're talking about the data center construction market growing to $350 billion by 2030. All of our products support that, in particular, Genie product is used a lot in data centers. Waste and recycling, tremendous opportunity to service that and that goes across all of our businesses and product lines as well. And electrification, I talked about the need for electric grid expansion as we move to electric vehicles. And we need a stronger grid and a larger grid to support all of that. And then, of course, infrastructure. And so the infrastructure investment. So we're talking about trillions in the infrastructure and investment that governments around the world are making and, of course, in the United States as well. So we think that we have growth from normal growth, but we also are positioned to benefit from -- greatly from those trends. And so we had an Investor Day in December, and we produced and we issued 5-year targets in 2027 that says that we can grow organically up to $6 billion. We did $4.4 billion in 2022. And expand our operating margins to 13% to 14% so 400 to 500 basis points. Our earnings per share, essentially doubling over the time period organically and then a return on invested capital excess of 25%. That's all organic. And of course, we would have opportunities for inorganic as well. So we're very excited about Terex and the future. And with that, I'll turn it back to Tami.

Great. Thank you so much, Julie. So we want to keep it interactive. So if anyone in the audience has questions, please raise your hand and you'll be given a mic and you can ask your question. So while we wait for a question from the audience, I'll start off. So when you think about the stickiness of your backlog, you're sitting on record backlog, right? How confident are you that these are real backlog, and there is no double ordering or you wouldn't see any cancellations or pushouts? Are you seeing any right now? Any updates on the backlog?

Thanks. Yes, so we do have $4.1 billion of backlog. And in 2022, we did $4.4 billion of sales. So we have a lot of visibility, more visibility into 2023 than we historically have had. And so one of the things that we realize that we operate in a complex environment and macro environment right now where there are cross currents. And so we monitor our cancellations and pushouts. The first thing that happens if there's a slowdown, is that our customers start to push out deliveries. And then they may cancel the order ultimately. We have seen -- we have not seen any pushout or cancellations that's above normal noise in our business to this point in time. And so we just haven't seen that yet. And we have customers who are asking us for more equipment faster as opposed to pushouts and cancellations.

Great. And along those same lines, have you seen any impact from the rising interest rates on your customer behavior? Are they worried? Is it making their purchases more expensive, hence, their..

Well, certainly, interest rates have gone up over the last 12 months. And so that increases the cost of a purchase for any buyer. But at this point in time, we do not see our customers canceling or making different decisions because of interest rates at this point in time. They seem to be -- they're continuing with their normal ordering -- or with ordering patterns. I don't know if there's anything normal about the last 12 to 18 months in the order patterns, but they're continuing to order. And we haven't seen customers walk away because of the cost of interest up to this point.

Just a follow-up, Jamie [indiscernible] talked about this earlier today. I'm trying to get a sense of how many of your not -- United Rentals and so forth, but ex that, the small, medium-sized business doing construction projects, do you have a sense of how the scope of that customer base for you because you may not have seen it, but Jamie, was pretty clear that middle-sized bank lending to those small and medium-sized businesses is absolutely going to contract. It's significantly going to contract, and he said specifically you were there. He said specifically, they're going to hold on to capital because they needed deposits to come up. And that loan officers are going to get more aggressive, give less credit. And just -- and you may not see, we may not see it yet, but I think it's a fundamental fact that that's going to happen. So how we think about your business not right now, but over the next 6 months, if what Jamie said comes true?

So I would just say that from a perspective -- first of all, when I think about our orders and bookings, and this is going to be a multi-long answer, I would say that our Genie business, in particular, can benefit from the replacement cycle. So if you look at our revenues in 2018 and 2019 and you think about a replacement cycle, they were 21 -- 20% to 22% higher in 2018 and 2019 than they've been recently because of supply chain constraints and because of the industry, not just Terex's ability to supply them. So we still continue to see demand in the replacement cycle. Then we also see demand from all of these megatrends and a lot of these megatrends including the CHIPS Act, the Inflation Reduction Act, infrastructure spending is government-backed spending. So this does not stop. And we have -- at Terex, we used to have a financial arm. We don't anymore. So it's clear that its -- but we still help our customers through financing alternatives, and we will continue to help our customers through those issues. So it's continual monitoring going forward in the bid. We haven't seen it yet. You're correct. But we will continue to keep our eye on it. And at this point, again, we see tailwinds from various different things and various different facts going on in the environment right now.

As it relates to the AWP business, I was wondering if you could speak to the power dynamics or the relationship with the national rental companies and your ability to push price when there's such a large -- such a large buyer.

Okay. Thanks for the question. So -- in terms of the large nationals, large nationals have pricing power. However, we have been very transparent with our national customers and in particular, over the last 12 months have had to go back and share our cost increases with them and have pushed through pricing midyear, which hasn't historically happened. And we do have the ability in our contract to go back and raise prices. Now the customer -- the national customer can choose to cancel -- but at this point in time, they need the equipment. And so -- and the rest of our competition hasn't been able to fulfill the demand either. So we've been able to increase prices with the nationals.

I had a question about a megatrend that you didn't specifically point out, but near-shoring, deglobalization, friendshoring, how is that affecting your customers' desire to sort of buy equipment that's made in the U.S. versus equipment that might be an import competitor?

I would say that we have continued -- Genie is a great brand. So we have great brand recognition. We have a great quality, quality by design. We have leading technology. And we also have the rental model, remember, has a great part of the model is resale at the end of -- at a certain period of time, they'll resell it. And so it has great brand recognition. And so our customers continue to buy Genie products and like Genie products in North America. As far as spending related to some of these other bills that are coming up. We've seen maybe a little bit of spend from state infrastructure at this point in time related to some of this may be left over COVID, but we really haven't seen the spending come through yet for major infrastructure and some of these major products. And you are correct, reshoring is another megatrend that would benefit Terex's business going forward as we go forward in our growth prospects.

Just a quick follow-up. Which specific end markets we've been reshoring, do you expect to benefit from the most?

Well, so I would say nonresidential construction, right, as people decide to build more things closer to home and bring some of the production back to North America. We're building right now in Monterrey, Mexico as well. And so that -- part, it will be closer than some of our other factories for some of our products, reduce transportation costs and be closer to our North American customer base.

So on Monterrey, Mexico, can you remind us the time line when you're planning to fully move out of Redmond to Monterrey? And then what kind of margin benefit we can expect down the line?

So first of all, let me be clear that we're not moving totally out of Redmond at this point in time. What we do have in Monterrey right now is a temporary facility. So we went down and we leased a temporary facility. We hired a management team and a workforce and have been producing telehandlers in that temporary facility. We have a facility -- a new facility that we have constructed, the building itself is complete. And we are moving into that starting in the second quarter by moving from the temporary to the permanent facility, and then we'll start more production moves that will happen over the next 12 to 18 months. So things will be coming from Redmond, a couple of things maybe from Italy, a little bit from China. There are many moves. And I want to tell all of our investors and everybody listening that the Genie team moves products all the time. They have a process. We're confident in their ability to move things. They know how to -- we do all -- we know how to do that. And so we'll be moving these products over the next 12 to 18 months. And then once the facility is fully up and running, we're expecting about 200 margin basis point improvement. That comes from a lower cost base. It's -- in Mexico, lower labor costs and improved supply chain and lower supply chain costs as well. So we're very excited about that. We would expect that to start -- investors to start seeing that and for us to start seeing that at the end of Q4 of 2024 as these moves are complete. So when those moves are complete, we still have some production facilities in Redmond. Redmond has been constrained by labor. It's an area that's grown dramatically with Microsoft and Amazon and some of those things. And so it's been in some of those great businesses that are based there. And so direct labor has been difficult recruiting in that area. So the Monterrey facility gives us an advantage there as well.

So the products you're going to be eventually making in the Monterrey facility, would those be exported to let's say, the U.S. only? Or is it going to go globally?

It can go anywhere. I mean, so we'll be -- it will have the ability to export as well from that facility.

So I wanted to understand the competitive forces better. What we've heard from several dealers that there is increasing competition from Chinese imports in the U.S. Are you seeing that for your products?

So are you referring to the Genie business in particular?

Yes.

SP2 Okay. So for the Genie business, some antidumping that has happened. So the Chinese can't import directly into the U.S. We do see Chinese competition throughout the rest of the world. And so there have been fierce competitors and they have some inventory. So in some cases, we have had -- customers say we're going to give this a try because they have inventory and we can have it right away. So, I think, the advantage that we have at Genie and Western is that we have extensive testing that goes on before we reduce -- before we introduce a product, extensive testing. we have quality and quality by design. We have service capabilities and we have brand recognition when a customer and a rental customer goes to sell it on the external market. So we believe we still have -- we have a competitive advantage against some of these newer brands that are just coming on the market from China.

So moving on to inflationary pressures. I think you mentioned you were price cost neutral last year. Price cost negative in the first half, but then you caught up in the second half. So on the net, I believe you were neutral last year. So can you talk about the current inflationary pressures and what the price cost assumption is for the year? And if there is any upside to that, should material costs keep coming down?

So I will talk about -- let's talk about the MP business first. So this answer varies by business. So the MP business has -- is very dynamic in their pricing. And so they are looking at pricing virtually every order and looking at the current cost. And they have -- although our lead times are 3x longer than normal right now because of the backlog, we still continue to be able to dynamically price and forecast the inflation. And they've done a really nice job, and they were price cost positive really for the full year. When I look at our utilities business, our utilities business started increasing prices throughout 2022. And for our Genie business, we were price cost negative for the whole AWP business in the first 6 months and then price cost positive in the second 6 months of the year, so relatively neutral for the year. And so we've been very transparent with our costs and what our cost structure is like with our customers. And so we share that and we have the ability to increase our pricing should inflation be greater than what we think it is at this point in time. We are seeing cost inflation right now. And so when you read about consumer price indexes going up 6% or whatever, we are seeing still inflation. Some people think, okay, prices are coming down. So we're not -- we're still seeing inflation. And when you think about it, we are OEM. So we're at the last of the supply chain, the last leg. And so there are various tiers to the supply chain. And so it takes time from the first supplier to the next tier of the supplier, to the next tier, they increase along the way, and it takes time for that to come through. And so what's happening is that we're still getting caught up from last year, but we're also seeing wage inflation. And so when you think about that, that wage inflation still has to come through. So we are still seeing cost -- overall inflation in the business.

And so going back to your long-term targets, I think you're targeting about, call it, 78% CAGR in each of the 2 segments by 2027. But historically, the AWP business has been quite cyclical with a very hefty drawdowns during recessions. So how do you -- what gives you the confidence about this CAGR? And how much do you think of that is going to be driven by price versus volume?

So we would -- certainly, we want to improve, and we talked about improving Genie's profitability through the cycle as being one of our -- and margin expansion in that business. But when I think about that business, and again, we talked a little bit before about the replacement cycle, we are 20% down from where we were in both 2018 and 2019. So here we are sitting in 2023. So we have to replace that, which would mean that we have ability to increase just through fulfilling replacement capital from our customers. Our customers, especially the national rentals and other independents as well, would take more equipment if we could get it to them sooner and faster. So they are looking for more equipment. And so we have that going for us. And then we have all of those megatrends that support activity and they're, again, government funded that support that activity that gives us another way to grow. So we're positive. We know that it's not going to be a linear growth. We're comfortable with where we are today, and we're comfortable with the starting point. We're comfortable with the endpoint. There may be some -- from quarter-to-quarter, there may be some variation. And that's the way it goes. And then particularly in the supply chain environment.

So volumes are about 20% below pre-COVID levels for Genie, right? Is there a number for the MP segment that you can share?

The MP business is actually up from where they were in pre-COVID business. So that business, we talked about at Investor Day and for the last 4 or 5 years, it's had like a 500-point margin expansion since like 2016, and we're forecasting to continue to grow that business. We love that business. We -- it has -- it has consistent strong performance. It's very geographic-diverse. It's product-diverse. And so we really like that business and look forward to it to continuing to grow. When you think about aggregates, the aggregates business is very strong, and we need aggregates and sand is a scarce resource and used in semiconductors, too. And so -- and to support all the growth that we have, we're going to have higher demand for aggregates. And you think about one of our products that supports ESG goals, you think about construction and demolition, and we have a mobile crusher and screener now. And so we can go to the site where we're demolishing something we can crush it, we can sort it, we can wash it and we can reuse some of the aggregates as opposed to bringing in a whole bunch of dump trucks and hauling in away and putting in a landfill. So we think it's -- there's some great expansion. So when we think about environmental solutions, there are great things there. We're in the concrete business. So that's great expansion there as well in supporting all of these bills that are there and growth opportunities. When we think about our lifting business, we have a great business in Australia called Franna. It's a pick and carry crane and some of the cranes are unique to a certain market and certainly in Australia. It's unique to Australian market. And what we've done is we redesigned our product for India, which is the world's largest pick and carry crane. And so if you look at our social media and things we have things posted. Bauma took place in India in the last month or so, and we introduced a new pick-and-carry crane being able to produce it in India and India supply chain. So we think that's a great opportunity for growth. We look at our Fuchs business, which has historically been related to scrap steel and material handling and scrap steel. We're diversifying that business as well. And in our year-end earnings call, we talked about a port application that was all-electric on a ship. And we're expanding there to get into larger -- taller, larger applications at the port, et cetera. So we have lots of growth opportunities in the MP business as well.

I think we have a question in the back.

So my question is just on the long-term outlook. How much of that comes from growth internationally within the AWP business just through increased adoption of that product?

So I would say that absolutely markets like India, which we think is a great growth market, are just adopting some of these technologies. Frankly, China is still an early adopter of some of these technologies, Latin America as well. And so we have the opportunity to grow in some of these countries as well as grow in the Western countries that we have as well.

Have you disclosed how big that part of your business is for AWP?

So we disclosed the AWP sales and bookings by region on a quarterly basis, yes. So yes, we do. And expanding from where we've disclosed it in 2022. So how is that?

So We have about 5 more minutes. I'm going to ask 2 questions. The first one, you mentioned the Fuchs business. I think you mentioned some softness in that business in the last quarterly call. And I think it was coming from Europe. Are you preparing for a multi-quarter slowdown? Or given it is kind of related to scrap steel, steel prices are coming back up again. How should we think about the Fuchs business for the next few quarters?

So for the Fuchs business, we did see a softness in bookings, particularly in Europe in the fourth quarter. But we still have higher backlog in that business than what we've had. So some of it is just lumpiness and -- but it was something that we called out because we want to continue to watch because that business is in Germany. And clearly, we've had concern about what happens in the economy in Europe. The same for RT, RT [ Towers ] is a product that is sold primarily in Europe for Europe, made in Europe for Europe. And those -- that business as well has backlog that's stronger than it was a year ago, but the incoming bookings were slower. So we'll -- we're not planning on -- Europe has been a very strong -- has held up really, pretty well. I would say we're not planning for that. However, I want to assure you that we do scenario planning that -- so that we are prepared should there be a downturn, and we would take appropriate actions, if needed. But at this point in time, we just -- it's more of a lumpiness of the businesses, and we'll report more on that in the Q1 earnings on how things are going in Europe.

And when I look at your leverage, it's quite low versus history, I think, it's below [ 1.5 turns ]. And you've done 7 acquisitions, I believe, since you resumed it in 2021. So when you look at the current rising interest rate environment, do you think you would want to push that back to like a [ 2x or 2.5x ] if you find good candidates? Or do you want to stay low for the time being and see how things go?

So I will say that the company has done just a really great job of paying off debt. We've paid out a significant amount of debt, and our net leverage is about 1x at this point in time. And so when we think about our leverage, we say that we don't want to go higher than 2.5x through the cycle. And if we were going to do any acquisitions, we were going to be very disciplined. We would look for a business that's running well, that has nice no fixed directors, that has technology that we can utilize that's adjacent products. We like our MP business. We like our utilities business but we like technology for the Genie business and those types of things. And we would be disciplined. The acquisition has to be accretive after the first year of purchase accounting. It has to out-earn its invested capital. We have that 21.3% return on invested capital, which is significantly above our cost of capital. So the business has to be able to out-earn its cost of capital. And we want to keep our leverage at 2.5x through the cycle. So I also want to say that when we look at our debt levels, we do have some outstanding borrowings on our revolver at this point in time. That's our variable interest rate. We have about over 70%, 73%, I think it is, of our outstanding debt is at a fixed rate of 5% through 2029. So that's very attractive to us right now in today's interest environment as well.

I had a couple of questions. One on the demand side, right? So you entered the year with this record backlog. And I'm wondering if you can phrase it -- I don't know if you can answer the question, but -- how much of this is anticipatory from the customer base because of all the stimulus versus the market being, say, tight to begin with, right? So 2022 is a great year for you. It was a good year for customers, right? I'm wondering -- are they sitting there and everyone is excited about the IIJA and the IRA? And are they anticipating growth in ordering like that? Or is it they're behind and the market is tight to begin with entering the year? So I'm just curious, your comments on that. And . I'll ask the second one after.

Okay. I'm hoping you get all the parts of the question. So the first -- the first I would say is that because the utilization rates are so high for our customers' equipment, our utilization rates are extremely high right now. So that equipment is being used. And as I mentioned before, with our volumes down because of supply chain from where they were in 2018, 2019, there is room for replacement down 20%. So there's growth for us in just replacement once the supply chain catches up, plus then growth on top of it. Our customers are telling us that they want the equipment sooner, and they'll take it sooner. Traditionally, our customers wouldn't want to take deliveries in Q4 or Q1 because they would want to get them -- they would want to get them in the springtime and the summertime for peak rentals, but they'll take them as we can give them. So they're seeing -- we're slotting in filling our production slots and our customers are at this point in time saying they want more, and it's because of all of these things. So the megatrends and the growth is part of that, but there really is growth. You look at that 20% lower in 2 consecutive years, that still provides a nice headwind in the Genie business. For the MP business, the dealers there, the dealer inventories are low. Some of our dealers have nice programs where we have rent-to-own, rent-to-purchase type of agreement inventories. But right now, all of our deliveries are going to specific customers. So our dealers haven't had that inventory to explore rent-to-own opportunities as readily as they'd like them as well. So right now, I think that there's demand just in replacement and dealer inventory as well as growth in the marketplace. And again, the utilization rates support that.

Yes, it seems to be one of the better themes into 2023, especially compared to other industries. And I asked because, I think, those of us who are sort of bullish and on board with it, you're trying to find holes on where this derails. It sounds like even if some of that stimulus money gets delayed or there's financing issues for the market to get loose, you would need a pretty severe downturn.

Well -- yes, I think, again, the best that we can do to answer your question is really watching those push outs and cancellations. The first thing that we'll start to see is push outs. The second thing we'll start to see is cancellations and the amounts of them are just normal course at this point in time. And so we'll continue to monitor it. And at this point in time, we just haven't seen that. So it's -- and I think our customers are saying the same thing right now.

And if I can squeeze one more in on the backlog. I'm wondering, so the national accounts have been taking share on the rental side. I'm wondering, does your backlog will look like your revenue today? Or does the backlog also skew national accounts where suggest they're going to take more share?

Yes. So our customer mix is relatively constant throughout. We -- it's going to vary by quarter on what customer order we're fulfilling at a particular time. But we have been trying to -- as John Garrison would say, he's trying to keep all customers equally unhappy. And so we have customers that are throughout the globe that order from us, and we're trying to provide equipment to all of our customers on an equal basis, if you will.

If there are no more questions, I think we can call it a day.

Okay. Thank you very much for your interest in Terex. Appreciate it.