Good morning, everyone. Welcome to the Terex Corporation Annual Meeting. My name is Cassandra, and I will be your operator. I will now turn the call over to Mr. John Garrison, Chairman and CEO of Terex.
Mr. Garrison, you may begin.
Good morning. I am John Garrison, Chairman of the Board of Directors and CEO of Terex Corporation. And on behalf of the directors and our management, I welcome each of you to our twenty twenty Annual Stockholders Meeting. I would also like to call your attention to the stockholder forum on compensation that was held immediately prior to this meeting. I hope that our stockholders found this dialogue with the compensation committee chairperson to be informative.
This is an example of the board's and management's desire to be transparent and obtain input from our stockholders. During today's meeting, we will cover matters outlined in the proxy statement, election of eight directors for one year term to hold an advisory vote to approve the compensation of the company's named executive officers ratification of the appointment of Pricewaterhouse Coopers LLP as Terex's independent registered public accounting firm for 2020. After these matters have been acted on, the meeting will be adjourned. Following the meeting, I will present an overview of COVID-nineteen actions and you will have the opportunity to ask questions about Terex. Each stockholder wishing to speak will have the opportunity to be heard.
Now I'd like to introduce the officers of Terex present at this meeting: John Sheehan, Senior Vice President and Chief Financial Officer Scott Posner, Senior Vice President, General Counsel and Secretary Amy George, Senior Vice President and Chief Human Resources Officer Stacy Babson Smith, Vice President and Chief Ethics and Compliance Officer. Now let's start with the formal business of the meeting. Mr. Posner advises me that the proxy materials were mailed to every stockholder of record entitled to vote at this meeting. Broadridge Financial Solutions has tallied the proxies.
Broadridge has advised me that there are represented at this meeting a total of 63,600,000.0 shares, representing 92% of the outstanding stock entitled to vote. Under our bylaws, this constitutes a quorum for the transaction of business. Most of our stockholders unable to be here in person or online are voting by proxy. If you have already filed your proxy, your vote has been counted according to your instructions. If there are any stockholders online who have not voted, wish to change their vote, or to vote today, you will be given the opportunity to do so prior to the voting on each item of business today.
The polls opened this morning and will close at the adjournment of the meeting. The quorum report of Broadridge is ordered to be filed with the minutes of the meeting. The first proposal before us is to elect eight directors to hold office for one year. Before we consider this proposal, I would like to introduce and recognize the director nominees who, with me, are standing for election. I'm the Chairman and CEO of Terex and have been a member of the Terex Board since 2015.
Paula Chumley Paula was most recently a private consultant on strategic planning and has been a member of the Terex Board since 02/2004. Don Dafosset. Don retired in 2005 as the Chairman, President and Chief Executive Officer of Walter Industries and has been a member of the Terex Board since 1999. Tom Hanson. Tom retired in March 2012 as the Vice Chairman of Illinois Tool Works and has been a member of the Terex Board since 02/2008.
Raymond Klingner. Raymond is the Managing Partner of the Institute for Manufacturing Excellence, GmbH, and has been a member of the Terex Board since 2012. Sandy O'Connor. Sandy recently retired as Chief Regulatory Affairs Officer of JPMorgan Chase and has been a member of the Terex Board since March 2020. Andra Rush.
Andra is Chair and CEO of Rush Group and has been a member of the Terex Board since 2017. David Sachs. David is the Lead Director and a partner at Ares Management and has been a member of the Board since 1992. I would also like to recognize Scott Wine, who is retiring from the Terex Board and thank him for all his years of service to Terex and the management team, our customers and our shareholders. Now may we have a motion to elect the eight directors designated as nominees in the proxy for a one year term or until their successors are duly elected and qualified.
So moved.
May I have a second? I second the motion. Thank you. Tariff statement in support of this proposal is set forth in a proxy statement on page three. The second item on our agenda is an advisory vote to approve the compensation of the company's named executive officers.
May we have a motion to approve on an advisory basis the compensation of the company's named executive officers as disclosed in the proxy statement? So moved. May I have a second?
I second the motion.
Thank you. Tarek's statement in support of this proposal is set forth in the proxy statement on page 16. The third item on our agenda is to ratify the selection of PricewaterhouseCoopers LLP or PWC as the independent registered public accounting firm for Terex for 2020. We have a representative from PwC with us today, Mr. John Eilers, a partner at PwC.
John, thank you for attending. May we have a motion to ratify the selection of PwC as an independent registered public accounting firm for Terex for 2020? So moved. May I have a second?
I second the motion.
Thank you. Tarek's statement in support of this proposal is set forth in the proxy statement on Page 43. We're now going to open the meeting for the receipt of the votes. There is no need for anyone who has turned in his or her proxy to do anything. Your proxy will be counted as your vote.
For those stockholders attending online, you may vote your shares by clicking the Vote Here link on your computer screen. Mr. Posner is now prepared to submit the count of votes cast based upon the proxies and ballots which have been processed.
Mr. Chairman, my preliminary report based on the proxies and ballots that have been processed thus far show that each of the eight nominees standing for election as a director received a majority of the votes cast. On the proposal to approve an advisory vote on compensation of the company's named executive officers, 52,900,000.0 shares or 94% of the voted shares have voted for and 3,200,000.0 shares or 6% were voted against. On the proposal to ratify the appointment of PwC as the independent registered public accounting firm, 61,700,000.0 shares or 97% of the voted shares have voted in favor and 1,800,000.0 shares or 3% have voted against. Mr.
Chairman, the final tabulation of the votes on all of the proposals voted on today will be included in the company's current report on Form eight ks, which will be filed with the SEC within the next four business days.
Thank you. On the basis of that report, I declare that the eight nominees listed in the proxy statement standing for election have been elected as directors. The advisory vote on the compensation of the company's named executive officers has been approved. The appointment of PwC as the independent registered public accounting firm has been ratified. Since there are no other business properly before the formal meeting of the stockholders, may I have a motion to adjourn the meeting?
So moved.
May I have a second?
I second the motion.
The formal part of this meeting is now adjourned. I will now present an overview of the company's COVID-nineteen actions. And at the conclusion of the presentation, I will be happy to answer any questions that you may have about Terex. At Terex, we draw our strength from our Terex Way values and our commitment to a zero harm safety culture among all of our team members worldwide. These values and our commitment to safety are helping Terex to operate safely despite the COVID-nineteen pandemic.
I'm pleased to report that we've only experienced a small number of confirmed cases of the coronavirus among our 9,000 plus team members worldwide, and that's despite operating in several hot zones around the world. We thank our team for practicing our strict safety protocols to keep themselves, their families, and our communities safe. The purpose of Terex is to help improve the lives of people around the world. Citizenship is one of our six Terex Way values. I'm really proud of our team members who have helped others in their communities during the COVID-nineteen pandemic.
Here are just a few examples, few of many examples. In Redmond, Washington, our Genie team produced and donated 4,500 protective face shields for local medical professionals. In India, Terex team members voluntarily contributed from their own salaries to purchase almost 20,000 pounds of food for a community kitchen in Delhi. In Watertown, South Dakota, our utilities team used a three d printer to make parts needed for face shields. They have distributed 1,000 face shields to healthcare providers in South Dakota and Minnesota.
And in Northern Ireland, donated over 5,000 face masks to a COVID-nineteen community group. The masks were sent by our team in China. This is a great example of team cooperation across Terex. From the outset of the pandemic, Terex has put in place strong safety protocols to protect our team members. For the past eight weeks, we have paused manufacturing at many of our facilities in response to lower customer demand and government actions.
Now I'm pleased to report that we're beginning to resume activities at our factories and offices around the world. To make sure we do this safely, we are implementing additional layers of return to work and continue to work standards. These include health checks and temperature checks, social distancing and face coverings. The coronavirus first appeared in China and our manufacturing facility in Changzhou was closed for several weeks. Today, they are fully operational again and our Changzhou team has remained healthy.
We've taken the safety lessons from our China team and applied them globally to the benefit of all of our teams. As a result of the COVID-nineteen pandemic, our business customer cancellations and delivery delays in the March. In response to this unprecedented situation, we took swift action. We have implemented a comprehensive cost reduction program that includes salary reductions, furloughing team members, some permanent reductions in force, temporarily suspending manufacturing operations to align with customer demand and partnering with suppliers to limit incoming supply of materials so we take in and pay for only what we need for current production. While the environment continues to be uncertain, we are implementing cost savings in excess of $100,000,000 The Terex team is committed to taking the proper steps to protect the financial well-being of the company.
Terex is focused on ensuring we have the liquidity that we need. As of March 31, we had $945,000,000 in available liquidity. We are participating in tax and other government relief programs. We're utilizing worker assistance programs in The United States, The UK, Germany, Australia and other countries. We've begun a global effort to reduce indirect expenses.
We've taken 35% out of our capital expense budget for 2020, while we also are investing in the future, but on a strategically targeted basis. Working with our banks, we successfully extended and amended our revolving credit facility, And we suspended our dividend and share repurchases for the remainder of 2020. As a result of these actions, I am confident that we will have more than sufficient liquidity through the downturn and that we will be able to grow when we get to the other side of this pandemic. I want to take you through our updated operational priorities for 2020. In both of our business segments, Aerial Work Platforms and Materials Processing, our teams are aggressively managing their production operations by accelerating their SIOP cycle.
We are bringing in partial staff for certain product lines. The benefit is we can produce the actual customer demand, thereby minimizing our cash burn. A benefit of our strategic sourcing initiative is we reduced the number of suppliers. As a result, we have closer relationships with the suppliers. We have worked with our suppliers to reduce the amount of material coming into the plants.
Our teams are doing a good job of managing material flow while also ensuring that we have continuity of supply. We are responding to short term customer demand, but we're also focused on the longer term market dynamics. This includes investing in our new facility in Watertown, expanding our China facility, building out our parts and service businesses and developing new products. It is essential that we position Terex for growth when conditions improve. Through this pandemic, as always, Terex is following a highly disciplined approach to capital allocation.
Free cash flow execution is a principal financial objective for 2020. And as I mentioned, we took decisive action with our banks to ensure that we have ample liquidity to manage the business. We also reduced CapEx by 35% while continuing to fund the key investments that I managed. As business conditions improve, we will reinstitute return of capital to shareholders. So let me summarize for you where Terex is today and how we're leveraging our strengths not only to navigate the pandemic, but also to make sure we're well prepared when markets improve.
Our Terex team continues to live our zero harm culture in a challenging global environment. We are focused on meeting commitments to our customers and supporting them during these difficult times. We are prepared to meet gradually increasing demand for our products and to do this safely. Our businesses have a strong future, so we will continue to invest in innovative products and services to be prepared when market demand returns. Our management team is highly experienced and they are cycle tested.
We will navigate through the crisis by aggressively managing costs and liquidity. And with that, I'll thank you. I'll now open it up to questions. Scott, I believe we'll receive three questions. Okay.
The first question is related to how has the Execute to Win Strategy performed the last three years? I believe the strategy has served us well in that we're a substantially stronger company as a result of it, especially as we're facing this COVID-nineteen pandemic. We launched Focus, Simplify and Execute to Win. At that time, we were in a difficult position. Our business portfolio included some very good businesses, but overall, the company was delivering returns on invested capital or ROIC that was below the cost of capital.
In parts and tariffs, we're delivering above the cost, but overall, we were eroding value by spending more to fund growth than was actually being delivered in return. To correct this situation, we addressed the root causes of our low return and to better position the company to create value through future growth. And that's what we did. On the focus side, we achieved this by exiting businesses that were not earning adequate returns. On the simplify, we achieved streamlining the company structure, improving our core systems and processes and eliminating work does not require now in a smaller company as a two segment company.
On Execute to Win, objectives were met and we did make progress. Obviously, we believe we can continue to make further progress there. So as we face into this pandemic, I believe we have a robust portfolio that historically through cycles has been able to out earn the cost of capital. Obviously, this is a severe cycle and we're going to navigate our way through this. But building on the progress that we made under Focus, Simplify and Execute to Win, our strategy is going to evolve as we move into the future despite the pandemic.
And great companies execute well. It's the foundation of consistent performance year over year and that will be critical as we face the pandemic. So at the core, we'll execute, we'll be there, continuing process discipline, making progress on our Execute to Win priorities and driving that company culture around process discipline, measuring and driving accountability. But that in and of itself is not enough. So we're also going to focus on innovation, enhancing value for current and future customers, developing new products and services and really finding smarter ways to do things to make the company more efficient and effective.
And I will say as a result of this pandemic, given that we're remotely in many parts of the organization, we are being innovative in driving change there. And finally, grow. By executing and innovating effectively and making the right business investments that we need in certain parts of our business, As the markets improve, we believe we'll return to growth. So more to come on execute, innovate and grow, again, off of the foundation of focus, simplify and execute to win. And I believe it has served us well, especially as we're facing into this pandemic.
The next question is from the Carpenter's Union pension funds, which combined assets of $70,000,000,000 have a collective ownership position of 68,542 shares of the company's common stock. As long term investors, we appreciate the company's action to prioritize employee safety issues along with liquidity. We also appreciate leadership's foregoing compensation during the COVID crisis. The Board has suspended the share repurchase program. What factors would the Board consider in any decision to restart the share repurchase program?
Thank you. The Board will continue to follow our disciplined capital allocation strategy that has served us well. We'll continue to fund the operations needed in the business in terms of CapEx required, product development required. And as business conditions improve over time, we would then reinstitute our shareholder friendly processes of share repurchases and dividends. I think we've demonstrated over the last several years that we have had shareholder friendly policies in terms of dividends and share repurchases.
And as business conditions improve and markets stabilize, we would expect to reimplement that in the future. The next question comes also from the Mr. Chairman, the recent dramatic growth in the size of passive mutual funds corporate ownership interest in The U. S. Corporations raises important public policy and corporate governance issues.
Currently BlackRock and Vanguard each own approximately 10% of the company's outstanding shares. Does the Board see this growing ownership concentration as a positive or negative developing as it regards to long term corporate planning and performance? Thank you, Mr. Chairman. So again, thank you for all these questions.
As we look at it in reference to long term planning, we don't believe it has an impact share ownership has an impact on our long term planning. The Board and management are focused on doing the right things for the business in the immediate term and the long term. And we don't necessarily look at the share owners or the percentage ownerships that the respective shareholders have. The large shareholders are engaged in corporate governance, and I think that's helped corporations over time. Their ownership has increased, as you've identified, but it has been a gradual increase.
So as it pertains to long term corporate planning and performance, I don't think that has an impact on management or the Board's perspective on how we think about developing the business for the longer term. Scott, are there any further questions? No. No further questions. So I would like to then close the meeting by saying, first and foremost, thank you for your interest and your investment in Terex.
I'd also like to thank all of the team members that are listening in for their dedication to Terex and especially their dedication to our zero harm safety culture so that we can operate safely in the COVID-nineteen environment. So team, thank you. And for all those listening in, be safe and stay healthy. Thank you.
Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect. Have a great day, everyone.