29.04.2014

JLG lifts profits

JLG has reported first half results with revenues up 10 percent, while profits grew 44 percent.

Total revenues for the six months were $1.53 billion, almost 10 percent higher than in the same period last year. The increase was led by sales of aerial work platforms, which increased 16 percent to $737.5 million, while telehandler sales were almost flat at $517.4 million. Other revenues, which includes after sales support, improved 11 percent to $279.7 million.

Operating income for the period jumped 44 percent to $206.9 million, while the backlog slipped slightly to $726.5 million, from 778.7 million at this point in 2013.

Looking at the second quarter - from January to the end of March - revenues grew at a more modest six percent to $866 million. This was made up of aerial lifts at $421 million - up 11 percent - while telehandler sales slipped two percent to $299.7 million. Other sales improved 11 percent to $145.3 million. Operating income grew by 12 percent to $116.6 million. The changes reflect higher prices and improved volume partly offset in part by the absence of U.S. military telehandler sales, with the latest contract having been completed in the final quarter of fiscal 2013.

Oshkosh as a whole saw revenues decline 14.5 percent to $3.21 billion, the fall almost entirely due to a halving of defence revenues. The group posted a pre-tax profit of $172.5 million, 7.5 percent lower than this time last year.

Oshkosh chief executive Charles Szews said: “A strong focus on execution has enabled a successful roll-out of our MOVE strategy over the past two years and that focus was certainly evident this quarter. Our employees and business partners worked hard to overcome a number of weather-related challenges in the United States during the quarter, and we are thankful for their efforts. We are optimistic about our outlook for the second half of fiscal 2014. U.S. construction spending has continued to slowly improve. We are also seeing positive trends outside the U.S. as international orders for the first six months of fiscal 2014 grew at a double digit rate in our access equipment segment. This is encouraging as we seek to broaden our sales across the globe.”

“We recently participated in several successful trade shows for our non-defence businesses where we launched a large number of new products that we believe will improve performance for our customers.”

Vertikal Comment

Another positive set of numbers for JLG, particularly for aerial lift sales, which are likely to continue their upward trend in the second half. Telehandler sales are masked by the ending of its defence contract, with sales of construction machines holding up in what appears to have been a bit of sluggish period.

With new products beginning to ship and further new products due to be launched during the year, the company looks set to gain market share this
year.

The challenging defence market confirms the sanity of Oshkosh's decision to diversify through its purchase of JLG at the end of 2006, and how right it was not to listen to certain investors that tried to force it to dispose of the company a couple of years back.

Another positive indication of an improving market.