oshkosh Q32007slides

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  • 1. Earnings Conference Call Third Quarter Fiscal 2007 August 1, 2007 Robert G. Bohn Chairman, President and Chief Executive OfficerCharles L. Szews Executive Vice President and Chief Financial OfficerPatrick N. Davidson1 Vice President of Investor Relations August 1, 2007

2. Forward Looking Statements Our remarks that follow, including answers to your questions and these slides, include statements that we believe are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. All of our statements, other than statements of historical fact, including statements regarding Oshkosh Trucks future financial position, business strategy, targets, projected sales, costs, earnings, capital expenditures and debt levels, and plans and objectives of management for future operations, are forward-looking statements. In addition, forward-looking statements generally can be identified by the use of words such as expect, intend, estimates, anticipate, believe, should, plans, or similar words. We cannot give any assurance that such expectations will prove to be correct. Some factors that could cause actual results to differ materially from our expectations include the accuracy of assumptions made with respect to our expectations for fiscal 2007 and fiscal 2008, the Companys ability to integrate the JLG Industries, Inc., Oshkosh Specialty Vehicles and Iowa Mold Tooling Co., Inc. acquisitions, the consequences of financial leverage associated with the JLG acquisition, the Companys ability to turn around the Geesink Norba Group and Medtec businesses sufficiently to support their valuations resulting in no non-cash impairment charges for goodwill, the expected level of U.S. Department of Defense procurement of the Companys products and services, the cyclical nature of the Companys access equipment, commercial and fire & emergency markets, risks related to reductions in government expenditures, the uncertainty of government contracts, risks associated with international operations and risks related to the collectibility of access equipment receivables. Additional information concerning these and other factors is contained in our filings with the SEC, including our Form 8-K filed August 1, 2007. Except as set forth in such Form 8-K, we disclaim any obligation to update such forward-looking statements. 2 August 1, 2007 3. Oshkosh Q3 2007 Highlights Sales increased 108% to OSK Q3 Performance $1.85 billion(millions) Operating income increased$2,000 $250.0 133% to $192.7 million $1,847$1,800$1,600 $200.0 EPS up 68% to $1.21Operating IncomeSales Revenue$1,400$192.7 $1,200 $150.0 Increased fiscal 2007 EPS$1,000 $888estimate range to $3.35 to $819 $800$100.0 $600 $3.40; initiated fiscal 2008$82.6 $400$50.0 $63.0EPS estimate range of $200 $0$0.0 $4.15 to $4.352005 20062007 Oshkosh pursuit of MRAP Sales Revenue Operating Income business continues 3 August 1, 2007 4. Access Equipment Craig Paylor named presidentof segment Integration efforts continueto yield success Strong international markets,particularly in Europe Strong aerial work platformbusiness in U.S., but softertelehandler business 4 August 1, 2007 5. Defense Strong performance driven by need for heavy and medium tactical trucks Increased levels of: Employees Truck production rates Continuing pursuit of MRAP- type contracts, with significant available capacity: Prime SubcontractorKilleen, Texas Teaming (ex. the Bull)5 August 1, 2007 6. Fire & Emergency Tom Fenner namedpresident of segment Strong performance at fireapparatus maker Pierce Recent new productlaunches continue to gaintraction Large airport productscontracts ship in Q4 OSV integration isprogressing 6 August 1, 2007 7. Commercial Lower concrete placementsales due to: Slowdown after engineemissions pre-buy Weakness in U.S. residentialconstruction U.S. refuse sales remainedstrong Necessary steps being takenat Geesink Norba Group IMT integration continues ontrack 7 August 1, 2007 8. Consolidated ResultsDollars in millions, except per share amounts Third Quarter Comments20062007Net Sales$1,847.3$887.9 Access equipment % Growth108.1% 8.4% and defense led theOperating Income $ 192.7 $ 82.6way % Margin 10.4%9.3% JLG accretive to EPS % Growth133.2%31.2% by $0.35 per shareEarnings Per Share $1.21 $ 0.72 Debt reduced by % Growth 68.1%38.5%$23 million 8 August 1, 2007 9. Access EquipmentDollars in millions Third Quarter Comments 2006 2007 Sales up in all regionsNet Sales $873.8 NA - Particularly strong in % GrowthN/A NA EuropeOperating Income$ 98.3 NA Purchase accounting charges: % Margin 11.3%NA - $2.0 million inventory % GrowthN/A NArevaluation - $16.8 million recurring amortization and depreciation Backlog up 38.2%(1)(1) Compared to JLG stand-alone results. 9 August 1, 2007 10. DefenseDollars in millions Third QuarterComments 2006 2007Net Sales $376.3$291.4 Production ramp-up infull swing % Growth 29.1%3.7% Strong volumes in newOperating Income$ 65.3 $ 49.0and remanufactured % Margin 17.3%16.8%trucks % Growth 33.1%6.7% Sharply loweraftermarket sales Backlog up 65.4% 10 August 1, 2007 11. Fire & EmergencyDollars in millionsThird QuarterComments2006 2007 Growth in U.S. fireNet Sales $290.2$255.3apparatus % Growth 13.7% 14.7% Higher-margin airportOperating Income$ 29.0$ 29.8product sales heavilyweighted to Q4 % Margin 10.0% 11.7% Supplier issues in 2006 % Growth (2.7)%28.7%affect comparison Includes $31.9 millionof sales from OSV Backlog up 9.4%,including OSV 11 August 1, 2007 12. CommercialDollars in millionsThird Quarter Comments2006 2007 Concrete placementNet Sales $317.8 $350.6demand declined after % Growth (9.3)% 8.8%07 engine pre-buyOperating Income$ 17.8 $ 25.4 U.S. refuse sales up 14.4% % Margin5.6%7.2% Geesink Norbaperformance improved % Growth(29.7)%252.0%from Q2 Includes $25.4 million ofsales from IMT Backlog down 51.1%,including IMT12 August 1, 2007 13. Oshkosh Fiscal 2007 Estimates Sales of $6.3 to $6.35 billionExpectations: Access equipment sales ofapproximately $2.5 billion Defense sales to grow about 10% Fire and emergency sales toincrease over 20% Commercial sales to grow about 5% 13 August 1, 2007 14. Oshkosh Fiscal 2007 EstimatesOperating Income of $576 to $583 MillionExpectations: Access equipment margins slightlygreater than 9.5%, including purchaseaccounting charges of $65 to $67million Defense margins to decline byapproximately 100 to 150 bps Fire & emergency margins to be slightlylower than previous year Commercial margins to decline by50 to 100 bps14 August 1, 2007 15. Oshkosh Fiscal 2007 EstimatesOther EstimatesFiscal 2007 Estimates Interest expense and other$195 to $200 million (expense) Effective tax rate 36.0% Equity in earnings $7.0 million (income) Average shares outstanding75,000,00015 August 1, 2007 16. Oshkosh Fiscal 2007 Estimates Raising full-year EPS estimate range to $3.35 to $3.40 Estimated Q4 EPS range of $0.90 to $0.95 Anticipated capital spending of approximately $105 million Debt expected to be approximately $3.0 to $3.1 billion at fiscal year-end 16 August 1, 2007 17. Oshkosh Fiscal 2008 Estimates Sales of $7.0 to $7.2 billionExpectations: Access equipment sales toincrease 15.0% to 20.0% Defense sales to growover 20.0% Fire and emergency sales toincrease approximately 5.0% Commercial sales to be upslightly17 August 1, 2007 18. Oshkosh Fiscal 2008 EstimatesOperating Income of $705 to $730 MillionExpectations: Access equipment margins to improveby 100 to 150 bps Defense margins to decline byapproximately 200 to 250 bps Fire & emergency margins to improveby 50 to 100 bps Commercial margins to improve by100 to 150 bps Corporate expense to grow byapproximately $30 million18 August 1, 2007 19. Oshkosh Fiscal 2008 EstimatesOther EstimatesFiscal 2008 Estimates Interest expense and other$220 to $230 million (expense) Effective tax rate 34.5% Equity in earnings $3.0 million (income) Average shares outstanding76,500,00019 August 1, 2007 20. Oshkosh Fiscal 2008 Estimates Estimated annual EPS rangeof $4.15 to $4.35 Anticipated capital spendingof approximately $110 million Debt expected to beapproximately $2.65 to $2.75billion by September 30, 200820 August 1, 2007 21. Q3 2007 Summary Very strong performance by access equipment Defense business coming on strong, with margins moving into lower, more sustainable range Remain in hunt for MRAP-type business Commercial segment in the down cycle of the engine emissions pre-buy Favorable outlook through fiscal 2008 Success of diversification strategy is evident21 August 1, 2007 22. 22 August 1, 2007