29.07.2014

Billion dollar quarter for JLG

JLG has posted record results in the three months to the end of June, with revenues for the quarter exceeding a billion dollars for the first time, thanks to strong sales in North America and Europe.

Looking at the results for the first nine months of its fiscal year, revenues were $2.51 billion, an increase of just under 10 percent. This was made up of $1.29 billion of aerial lifts – up just over 10 percent on the same point last year - telehandler sales of $841.8 million - an increase of just over one percent on last year - while Other revenues – largely parts and service increased just over 11 percent to $436.4 million. Operating profit for the nine months was $373.7 million, an increase of just over 25 percent.

Moving on to the third quarter revenues were up 10.4 percent to $1.04 billion a quarterly record, it was made up of $558.1 million of aerial lifts – an increase of just under 11 percent, $324.4 million of telehandlers – an increase of 2.5 percent and $156.7 million of other revenues – up 13 percent on last year. Operating profits for the quarter were up eight percent to $166.8 million. While the backlog/order book shrank from $621.4 million last year to $487.4 million this year, although $13 million of last year’s backlog was military.

Oshkosh as a whole reported nine month revenues of $5.14 billion, a fall of over 13 percent, while pre-tax profits fell just over 15 percent to $333.9 million.

Oshkosh chief executive Charlie Szews said: "We are pleased with our overall third quarter results, led by record performance in access equipment and breakthrough improvement in the commercial segment. Each area of focus in our MOVE strategy – powered by the Oshkosh Operating System – is helping us to meet our performance targets. This balanced strategy is guiding our team to produce results from the initiatives that we can control by optimising costs, innovating to meet customers’ evolving demands and winning new business in emerging markets, even as some of our markets continue to recover at an uneven pace.”

“We continue to manage the downturn in our defence business in a responsible manner. We recently completed the previously announced additional reduction in our workforce, while retaining the expertise and skill sets that are essential to support potential new business, including the U.S. Joint Light Tactical Vehicle programme and several international tactical wheeled vehicle opportunities.”

“For fiscal 2014, we are narrowing our estimate range for full year adjusted earnings per share to $3.40 to $3.55 as we head into the final quarter of the fiscal year. Looking forward, we continue to believe the outlook for our non-defence markets in 2015 is positive, and we expect MOVE initiatives to continue to contribute to margin expansion in 2015 and beyond”.

Vertikal Comment

Another stellar performance from JLG which appears to be firmly cementing its position as market leader. It is also the first powered access company to ever achieve quarterly sales of more than a billion dollars.

JLG now represents over half of all Oshkosh revenues once again confirming the wisdom of dismissing Carl Icahn’s 2012 bid to force a sell off. The one concern is the shrinking order book, but much of this is down to timing in the comparative. The company certainly looks well placed to achieve annual revenues this year of around $3.5 billion.