Positive fourth quarter for JLG
By Euan Youdale02 November 2016
JLG net sales increased 0.8% to $775.8 million in the fourth quarter of the 2016 financial year.
Parent company Oshkosh said its access equipment segment, otherwise known as JLG, saw operating income decrease 20% to $45.2 million, or 5.8% of sales in the fourth quarter, compared to $56.5 million, or 7.3% of sales, in the fourth quarter of fiscal 2015.
These results, however, were impacted by charges of $27.8 million for asset impairments and workforce reductions, with $2.5 million in charges relating to the latter. Excluding these costs, adjusted operating income was $73 million, or 9.4% of sales, in the fourth quarter, compared to $59 million, or 7.7% of sales in the same period of the 2015 financial year.
“The increase in adjustedoperating income was primarily the result of lower spending on engine emissions standards changes, favourable material costs and lower provisions for valuation reserves on used equipment, offset in part by a challenging pricing environment,” said the group.
For the full year access equipment results reflect a challenging year in the sector. Sales, which include AWPs and telehandlers, reached $3,012.4 million, down from $3,400.6 million in 2015. Adjusted operating incomed for the year was $291.2 million, compared to $409.5 million in 2015.
Wilson Jones, president and chief executive officer of parent company Oshkosh Corporation, said higher than expected sales in the fourth quarter access equipment segment played a role in overall growth across the group. “Our access equipment team delivered on the commitment to balance production as inventory was reduced to targeted levels at fiscal year end helping to drive strong free cash flow of $490 million during the year.
“As noted during our recent Analyst Day, we continue to work on simplifying our businesses by focusing on those activities that drive the most value for both customers and shareholders. I am confident in our team’s ability to navigate through challenging market conditions in some of our businesses and position Oshkosh Corporation to take advantage of future opportunities.
Group consolidated net sales in the fourth quarter were $1.76 billion, an increase of 11.2%, representing an increase in sales in all segments. Higher international sales in the defence segment accounted for the majority of the increase.
The full year the company reported net sales of $6.28 billion and net income of $216.4 million. This compares with net sales of $6.10 billion and net income of $229.5 million in 2015.