JLG owner Oshkosh has reported third quarter results which show a 44.3 percent rise in sales of aerial lifts and telehandlers.
Third quarter access and telehandler revenues were $562.7 million, largely due to sales of replacement equipment in North America. JLG also had $17.4 million of intercompany component sales to Oshkosh during the quarter, compared to $316.0 million for the third quarter of 2010.
As a result of the lower overall revenues, operating income slipped 4.7 percent to $29.5 million. Other factors included an increase in production costs as a result of supply chain constraints and inefficiencies associated with on-going restructuring along with higher new product development costs.
Overall nine month revenues were down 54 percent to $1.38 billion due entirely to lower intercompany component sales following the completion of the M-ATV contract for Oshkosh. This also hit operating income which fell from $90 million to $30.5 million.
JLG’s backlog at the nine month stage surged to $613.6 million, from just $198 million at the same point last year. Oshkosh as a whole reported nine month revenues of $5.5 billion, compared to $7.7 billion in 2010, while pre-tax profits slipped from just over a billion dollars to $360 million.
Oshkosh chief executive Charles L. Szews said: “We are pleased with the progress we made on a number of fronts during our third fiscal quarter, particularly in our access equipment and defence segments. Access equipment sales to external customers grew 44 percent compared to the prior year third quarter and operating income margins in this segment improved to 5.1 percent. We also made substantial progress on our FMTV contract, raising daily production by the end of the quarter to over 20 trucks and approximately 10 trailers, while working to lower our production costs. Our defence business also received more than $700 million in orders for our high performance M-ATVs and related enhancement kits during the third quarter.”
“Additionally, we recently completed a comprehensive, six-month strategic planning process that provides our road map to deliver superior growth and earnings for our shareholders over the economic cycle. We will operate ‘Mission Driven: To Move the World at Work’ as one global team.”
“As part of this strategy, we plan to drive through the pending U.S. defence spending decline by capturing the full benefit of the economic recovery expected in our non-defence markets, continuing to pursue market share gains and expanding into emerging markets. We will also continue working with our dedicated employees and business partners to optimize our cost structure. Already, we are executing on a facility optimization strategy to become more efficient across our entire company. Early examples of this include the previously announced restructuring actions in our fire & emergency and access equipment segments.”
“Finally, we will increase our investment in innovative solutions that deliver value for our customers. We remain on track to triple the production rate of our FMTV in 2011, and we are receiving solid feedback on JLG’s 150-foot Ultra Boom.”