26.07.2012

JLG jumps 60%

JLG has reported its results for the nine months to the end of June, with sales up 60 percent and a strong increase in profits.

Total JLG revenues for the nine months were $2.2 billion an increase of just under 60 percent on the same period last year. The sales were made up of $1.06 billion in new access equipment – an increase of over 66 percent.

Sales of telehandlers jumped almost 80 percent to $643.4 million, while ‘Other’ revenue was up just over 30 percent to $499.5 million, of which $124 million was parts for the defence or other Oshkosh sectors. Operating income for the period increases more than fivefold to $169.7 million.

Moving to the third quarter overall revenues grew by 40 percent to $814.6 million, made up of $426.1 million of access equipment - an increase of just under 45 percent, telehandler sales increased over 80 percent to $260.8 million. Other revenue was down nine percent, entirely due to the absence of any intercompany sales. Operating income almost tripled to $88.2 million. The JLG backlog/order book at the end of June was $729.7 million – 19 percent higher than at the same point last year.

JLG says that the improvements in revenue reached double digit levels in every region, with the strongest growth coming from rental fleet replacements in North America. Margin improvements are the result of the higher volumes, along with price increases, partially offset by rising material costs.

Oshkosh overall saw revenues for the nine months improve 12 percent to $6.13 billion, while pre-tax profits fell over 40 percent to $214.9 due largely to product mix in the defence business – the third quarter saw an eight percent rise in revenue to $2.17 billion while pre-tax profit was flat at $105.6 million.

As a result of the strong performance in the third quarter the company has increased its forecast for the full year and says that it expects sales of access equipment to be around 40 percent higher for the full year - this would equate around $2.8 billion – with operating income in the region of 7.5 percent to 8.0 percent.

Oshkosh chief executive Charles Szews said: “Strong execution of our MOVE strategy initiatives supported improved results from the second to the third fiscal quarters. Each of our non-defence segments also posted improved performance and higher operating income margins compared with the third quarter of last year."

"Margin improvement was particularly strong in the access equipment and commercial segments due in part to our continuing efforts to reduce our product, process and overhead costs. Our defence segment performed well by delivering another quarter of improved margins on the FMTV program and just last week we announced an order for future sales of 750 M-ATVs to the United Arab Emirates.”

Szews continued, “This morning, we also announced that we are exiting two small businesses, our ambulance and European mobile medical businesses, in our fire & emergency segment. These were difficult, but necessary actions that will reduce costs and help the fire & emergency segment focus on profitably growing its core business across the globe.

Vertikal Comment

Another excellent result from JLG which is clearly quietly getting on with things, the bounce back in the American telehandler market has clearly been a boost, but aerial lift sales are also growing very strongly, even in Europe according to the commentary.

Looking at the full year the 40 percent growth projection for JLG appears somewhat conservative, given that we are now 10 months into the fiscal year it is quite likely that full year revenues will exceed $3 billion. The company last managed that in 2010 but that was only due to around $1 billion of low margin intercompany business.

The last time the company achieved $3 billion in external sales was for 2008.