30.04.2013

Telehandlers give JLG a boost

JLG has reported a strong first half in terms of both revenues and profitability thanks to strong sales of telehandlers.

Total revenues for the period were $1.39 billion up 10 percent on the same period last year for external sales. Last year the business also had $123.6 million of subcontract work for parent Oshkosh with made last year’s top line revenue look very close to this year’s number.

Looking at the key product areas aerial lift sales in the period were actually flat at $631.5 million - $2 million below that of last year. Telehandler sales however jumped over 34 percent to $514.3 million, while other revenues – largely parts and service etc… edged up almost two percent to $252.8 million. Operating profits for the period jumped over 76 percent to $143.9 million.

The company’s backlog slipped around 17.5 percent compared to a year ago to $778 million.

Looking at the second quarter total revenues were up 7.5 percent thanks to a 28 percent increase in telehandler sales to $307.4 million- most of the increase coming from North America, while aerial lift sales slipped back 2.5 percent to $379.3 million - due to lower sales in Australia, other revenues remained roughly flat at $130.7 million.

Operating profit increased 38.9 percent to $95 million, thanks to higher prices, the higher revenues and efficiency initiatives.

Parent company Oshkosh reported six month revenues of $3.73 billion, five percent lower than for the same period last year, due entirely to declining sales of defence equipment. Pre-tax profits however improved sharply to $186.7 million – over 53 percent up on last year. As a result the group is stepping up its full year outlook.

Chief executive Charles Szews said: “The Oshkosh team executed well in our second fiscal quarter. All four of our business segments delivered improved operating income margins compared to the prior year quarter, resulting in a more than doubling of our diluted earnings per share.”

“Our access equipment segment continued to benefit from replacement driven demand and improved pricing, while concrete placement product sales in the commercial segment reached the highest level of quarterly sales in nearly five years, benefitting mainly from improvements in the domestic housing market.”

Vertikal Comment

Overall this is a good result from JLG with the flat aerial lift sales being no surprise, given the softer order intake that most producers saw in the second half of 2012. It is a little surprising though that it did not pick up a little in the last quarter, we would expect that order intake has now regained some momentum – JLG makes no mention of this so we will have to wait for the conference call or until it releases its third quarter numbers later in the year.

In terms of profitability the business continues to gain momentum and there is no reason to think that this will not continue during the second half. All in all an encouraging set of numbers, which we hope will be further enhanced by at least some growth in aerial lift sales and stability in the company’s order book during the current quarter.