24.05.2006

JLG up 37% at nine months

JLG continues to grow at a rapid pace, with revenues for the nine months to the end of April 2006 up 37 percent on the same period last year to $1.6 billion.

Like-for-like revenues for the quarter (excluding Gradall excavator sales for last year) rose by 30 percent to $630 million.

Net Income for the nine months was $101 million, (7.3 percent of sales), compared to $21.5 million (6.3 percent of sales) in 2005, an increase of 470 percent. Net income for the quarter was more than double that of last year at $46 million.

Gross margins edged downwards slightly from 19.4 percent last quarter to 18.8 percent they are also down from the same period a year ago, when margins were 19.3 percent. However when looked at on a trailing 12 months basis, the margin trend continues to improve edging up to 12.9 percent to the end of April, compared to 8.9 percent a year ago.

Sales of new aerial lifts for the nine months were up by almost 80 percent compared to the same period last year to $800 million. This number excludes related parts and service sales which are shown separately.

Sales of telehandlers climbed by almost 50 percent to $521 million, at the current growth trends JLG cold catch up with telehandler market leader, Manitou during 2007.

Geographically Europe was the star performer for JLG, with a new record for a single quarter’s revenue of $125 million. European sales for the nine months were $270.5 million, an increase of 50 percent.

Revenues in the USA rose by almost 35 percent to $1.2 million for the nine months, while sales in the rest of the world, largely Canada, South America and the Pacific rose by almost 40 percent to $153 million.

Given the strong three quarters JLG has increased its forecast for the full year growth to be 30 percent, compared to its original projection of 20 to 25 percent. This equates to full year revenues approaching 2.3 billion, close to the level Vertikal. Net Forecast back in November.

"Quarterly revenues reached a new record and we produced solid earnings improvement during a period of major manufacturing realignment and capacity expansion," said Bill Lasky, chairman, president and chief executive officer.

"Despite the record level of shipments, incoming orders remained very strong and the open order board at the end of the quarter was $927 million, a significant increase from last year's level of $665 million. This continues to reflect strong market demand for JLG access products. Our supply chain is responding positively to the increased orders and we are on track to complete our manufacturing realignment and capacity expansion in the fourth quarter”.

“We plan to begin shipments of Caterpillar-branded telehandlers to European dealers in August and to North American dealers in November under our exclusive 20-year private label alliance agreement. In addition to supporting the alliance agreement, the manufacturing realignment and capacity expansion also provides the additional capacity and flexibility required to better satisfy overall demand for JLG access equipment, as well as ongoing productivity”

Vertikal Comment

JLG continue to turn in a first class performance with profitability climbing to the healthiest levels for many years. In the aerial lift market it is clear that JLG is maintaining is likely to maintain its market leadership over Genie, albeit by a whisker. Aerial lift sales including associated parts, service and used equipment is likely to be in the region of $1.35 billion.

In the telehandler market JLG continues to build its position in the Americas and its CAT deal will start to boost its market share in Europe from September onwards. At current trend levels JLG may well overtake JCB later this year and catch Manitou sometime next year.

Manitou are not sitting back and waiting for it to happen of course, but even gaining the number two slot is quite an achievement for a company that was not even in the market five years ago.

In terms of Profitability JLG is making strong gains, in spite of margins slipping back slightly over the past three months. At 7.3 percent of sales the company is moving back towards the levels of the late 90’s.

JLG will now hit a record $2.2 to $2.3 billion of revenues this year, close to the levels that Vertikal.Net forecast for the business back in November 2005.