JLG sales up 48%, expects record full year revenues
By Lindsey Anderson27 January 2022
JLG saw equipment sales soar for the three months leading to Dec. 21, 2021, reporting an increase of 48% year-over-year despite supply chain disruptions, the company has reported.
Access platform sales amounted to $415.3 million during the company’s stub period compared to last year’s $278 million. Telehandler sales also saw a boost, totaling $210.6 million compared to last year’s $122.9 million. The access segment’s total revenue of $834 million was a December quarter record for the company.
Despite demand for access equipment expected to remain strong for years to come, particularly in North America, the company said, supply chain issues and increasing materials costs have brought forth challenges for the world’s largest manufacturer of access equipment, particularly adding to a record-breaking backlog of $3.6 billion for Oshkosh’s access segment.
“[Access equipment] orders were strong once again at $1.65 billion in the quarter, up 70% from last year, which led to a new record backlog of $3.6 billion,” commented John Pfiefer, Oshkosh president and CEO. “Importantly, these orders include strong price increases, which provides better visibility to strong margins in the second half of 2022.”
JLG’s $3.6 billion backlog – mostly of which is for orders to be delivered in 2022, the company said – amounts to roughly 92% of JLG’s expected full-year sales.
Speaking during an investors call on Jan. 26, Oshkosh executives discussed how supply chain and material costs have impacted the company and industry as a whole, and what the company is doing to address these issues.
“The industry has been through a shock in terms of the material cost escalation that we’ve seen and… the supply chain disruption that we’ve seen,” Pfiefer said. “We’ve done a lot of work in changing the way that we manage our supply chain. If you look at our supply chain today, we’ve made a lot of improvements, both on working with our existing supply base to improve their capacity, but also in qualifying a lot of new suppliers. We’ve qualified hundreds of new suppliers to give us better capacity to serve our customers as we go forward.”
Pfiefer continued, “We’ve completely revamped our price on the material cost side. We’ve completely revamped our price locking and our hedging strategies, so that when we’re in periods where we’re building backlog, we’re much more intense about how we’re locking in prices and are taking hedging strategies to protect ourselves if we’ve got backlog that builds six, nine, 12 months into the future. And of course, we’re also changing terms and conditions with a lot of our customers where we’re building -- if we’re building backlog way into the future that we have some ability to adjust price if there is significant movement in materials.”
Oshkosh said it expects price cost headwinds to remain at peak levels in the first quarter of 2022 with “meaningful improvement expected in the second quarter.”
Despite these headwinds, Oshkosh noted market indicators such as fleet utilization use and pricing are solid.
“While the global supply chain and logistics environment remains less predictable than normal, we have taken many actions to improve our supply chain flexibility and mitigate risk,” Pfiefer said. “Market fundamentals continue to support our belief that we are in the early stages of a multiyear growth cycle.”