Oshkosh Truck Reports Second Quarter EPS Up 67.7%

OSHKOSH, Wis.--May 3, 2005--Oshkosh Truck Corporation , a leading manufacturer of specialty trucks and truck bodies, today reported that second quarter earnings per share increased 67.7 percent to $1.04 per share, on sales of $672.4 million and net income of $38.2 million for the quarter ended March 31, 2005. This compares with earnings per share of $0.62 per share, on sales of $518.2 million and net income of $22.5 million for last year's second quarter. These results exceeded Oshkosh's most recent sales and earnings estimates of $645.0 million and $0.66 per share, respectively, for the second quarter of fiscal 2005. Oshkosh also increased its sales and earnings per share estimates for the full year ending September 30, 2005 to $2.9 billion and $4.25 per share, respectively.

Sales increased 29.7 percent in the second quarter. Operating income increased 78.5 percent to $62.6 million, or 9.3 percent of sales, compared to $35.1 million, or 6.8 percent of sales, in the prior year's second quarter.

Commenting on the results, Robert G. Bohn, chairman, president and chief executive officer, said, "Our financial performance in fiscal 2005, particularly the favorable year-over-year earnings growth, continued to gain momentum. This was a record second quarter for the Corporation, driven largely by exceptional results in our defense business along with strong operational performance and a favorable product mix in our fire and emergency business.

"Our defense business performed beyond our expectations, providing favorable performance on our Medium Tactical Vehicle Replacement (MTVR) contract and stronger than expected margins on new truck and new service contracts.

"In our commercial business, the U.S. concrete placement and refuse markets continued to show strength and provided solid revenue growth. Unfortunately, operating income continued to be negatively impacted by lower-priced backlog, but that is now largely behind us, so we believe there is the prospect of margin growth in the domestic market.

Bohn continued, "As we move through the second half of fiscal 2005, we are focused specifically on capitalizing on the positive market developments in our businesses and on continuing the operational improvements of our McNeilus and European refuse operations. We are encouraged by the progress that we are making across the Corporation. On the basis of our performance in the second quarter and our positive outlook, we have increased our fiscal 2005 earnings per share estimate from $3.85 to $4.25."

Factors affecting second quarter results for the Company's business segments included:

Fire and emergency--Fire and emergency segment sales increased 57.2 percent, to $213.2 million for the quarter compared to the prior year. Operating income was up 69.5 percent to $19.0 million, or 8.9 percent of sales, compared to prior year operating income of $11.2 million, or 8.3 percent of sales. The JerrDan and BAI acquisitions contributed sales of $42.7 million and operating income of $2.1 million during the quarter. Sales and operating income from other businesses in this segment grew 25.7 percent and 50.9 percent, respectively, for the quarter. The higher sales level for these businesses reflected strong order flow for fire apparatus during fiscal 2004 and substantially higher airport product sales. Operating income margins for the businesses increased due to a substantially improved sales mix of custom pumpers, aerials and airport products.

Defense--Defense segment sales increased 24.7 percent to $209.6 million for the quarter, largely due to a more than doubling of parts and service sales compared to the prior year's second quarter as a result of the conflict in Iraq, which was offset by slightly lower truck sales. Operating income in the second quarter was up 114.4 percent, to $49.4 million, or 23.6 percent of sales, compared to prior year operating income of $23.0 million, or 13.7 percent of sales. Earnings for the current quarter increased primarily due to a $14.1 million cumulative life-to-date adjustment to operating income to increase the margins on the Company's MTVR base contract from 8.5 percent to 9.9 percent. Second quarter earnings also were favorably impacted by the more than doubling of relatively higher-margin parts and service sales.

Commercial--Commercial segment sales increased 17.2 percent, to $255.3 million, for the quarter on strong order intake in U.S. markets. Operating income decreased 31.6 percent to $6.5 million, or 2.5 percent of sales, compared to $9.4 million, or 4.3 percent of sales, in the prior year quarter. The CON-E-CO and London acquisitions contributed sales of $9.0 million and operating income of $0.5 million during the quarter. Operating income margins were lower principally due to continued operating losses in the Company's European refuse business and insufficient price increases for concrete placement and domestic refuse products to recover sharply higher domestic steel costs as well as other cost increases in the quarter.

Corporate and other--Operating expenses and inter-segment profit elimination increased $3.6 million to $12.2 million, due largely to increased personnel costs. Net interest expense for the quarter increased $0.6 million to $1.7 million, compared to the prior year quarter. Higher interest costs were largely due to higher average borrowings as a result of acquisitions.

Total debt decreased during the quarter to $69.4 million at March 31, 2005 from $104.4 million at December 31, 2004 in spite of the acquisition of London late in the quarter due to strong cash flow from operations, including a substantial increase in customer advances.

Six-Month Results

The Company reported that earnings per share increased 47.3 percent to $2.15 per share for the first six months of fiscal 2005 on sales of $1,317.3 million and net income of $78.8 million compared to $1.46 per share for the first six months of fiscal 2004 on sales of $1,011.4 million and net income of $52.2 million.

Operating income increased 59.2 percent to $130.3 million, or 9.9 percent of sales, in the first six months of fiscal 2005 compared to $81.8 million, or 8.1 percent of sales, in the first six months of fiscal 2004.

Change to Single Class of Stock and Dividend Announcements

The Company also announced that it has transitioned from having two classes of stock to a single class of stock, with the change effective immediately. Before the change, the Company had outstanding both New York Stock Exchange-listed Common Stock with limited voting rights and unlisted Class A stock with greater voting rights. Because holders of a sufficient number of shares of Class A stock have converted their shares into Common Stock, on a share-for-share basis, the remaining Class A shares converted automatically into Common Stock on the same basis, again, effective immediately. With the change to a single class of stock, the Common Stock now carries full voting rights.

Speaking on behalf of the Company's Board of Directors and management, Mr. Bohn said: "The stability that our Class A stock provided over the years benefited all shareholders by helping us build the Company that exists today. Now, because of our current strength and confidence in our future, we welcome the change to a single class of stock and believe that having voting rights commensurate with shareholdings will make our stock more attractive to the investing public. At the same time, we intend to continue to implement our strategic plan to generate long-term growth."

In addition, the Board of Directors declared a quarterly dividend of $0.1325 per share for the Common Stock. This dividend, up approximately 50.0 percent from the Common Stock rate for the immediately preceding quarter, will be payable May 24, 2005, to shareholders of record as of May 1, 20057, 2005. Previous holders of Class A stock will receive this dividend as holders of Common Stock.

Oshkosh Truck Corporation is a leading designer, manufacturer and marketer of a broad range of specialty commercial, fire and emergency and military trucks and truck bodies under the Oshkosh(R), McNeilus(R), Pierce(R), Medtec(TM), CON-E-CO(R), London(R), Geesink and Norba brand names. Oshkosh's products are valued worldwide by fire and emergency units, defense forces, municipal and airport support services, and concrete placement and refuse businesses where high quality, superior performance, rugged reliability and long-term value are paramount.


                       OSHKOSH TRUCK CORPORATION
              CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                              (Unaudited)

                          Three Months Ended      Six Months Ended
                               March 31,              March 31,
                         --------------------  -----------------------
                              2005      2004         2005        2004
                         ---------- ---------  ----------- -----------
                           (In thousands, except per share amounts)

Net sales                 $672,355  $518,213   $1,317,272  $1,011,407
Cost of sales              552,462   440,450    1,081,788     845,222
                         ---------- ---------  ----------- -----------
Gross income               119,893    77,763      235,484     166,185

Operating expenses:
   Selling, general and
    administrative          55,240    41,009      101,505      81,040
   Amortization of
    purchased intangibles    2,028     1,669        3,722       3,332
                         ---------- ---------  ----------- -----------
Total operating expenses    57,268    42,678      105,227      84,372
                         ---------- ---------  ----------- -----------

Operating income            62,625    35,085      130,257      81,813

Other income (expense):
   Interest expense         (2,239)   (1,401)      (4,490)     (2,549)
   Interest income             552       331        1,018         581
   Miscellaneous, net          100       600         (613)        560
                         ---------- ---------  ----------- -----------
                            (1,587)     (470)      (4,085)     (1,408)
                         ---------- ---------  ----------- -----------

Income before provision
 for income taxes, equity in 
 earnings of unconsolidated
 affiliates and
 minority interest          61,038    34,615      126,172      80,405

Provision for income
 taxes                      23,570    12,636       48,702      29,348
                         ---------- ---------  ----------- -----------

Income before equity in
 earnings of unconsolidated
 affiliates and
 minority interest          37,468    21,979       77,470      51,057

Equity in earnings of
 unconsolidated affiliates, 
 net of income taxes           867       494        1,340       1,114

Minority interest, net of
 income taxes                 (145)        -          (46)          -
                         ---------- ---------  ----------- -----------

Net income                $ 38,190  $ 22,473   $   78,764  $   52,171
                         ========== =========  =========== ===========

Earnings per share
   Class A Common Stock   $   0.92  $   0.56   $     1.91  $     1.30
   Common Stock           $   1.06  $   0.64   $     2.20  $     1.50
Earnings per share
 assuming dilution        $   1.04  $   0.62   $     2.15  $     1.46

Weighted average shares
 outstanding:
   Basic earnings per share:
     Class A Common Stock      805       814          806         814
     Common Stock           35,308    34,182       35,056      34,083
Effect of dilutive
 options and incentive
  compensation awards          705     1,035          774         954
                         ---------- ---------  ----------- -----------
Diluted earnings per share  36,818    36,031       36,636      35,851
                         ========== =========  =========== ===========


                       OSHKOSH TRUCK CORPORATION
                 CONDENSED CONSOLIDATED BALANCE SHEETS


                                          March 31,      September 30,
                                            2005             2004
                                        -------------     ------------
                                         (Unaudited)
                                                (In thousands)
                 ASSETS
Current assets:
   Cash and cash equivalents            $     23,178      $    30,081
   Receivables, net                          287,151          253,914
   Inventories                               556,031          368,067
   Prepaid expenses                           21,515           17,612
   Deferred income taxes                      36,025           41,033
                                        -------------     ------------
      Total current assets                   923,900          710,707
Investment in unconsolidated affiliates       19,893           21,187
Other long-term assets                        34,549           26,375
Property, plant and equipment                332,769          316,538
Less accumulated depreciation               (158,010)        (147,962)
                                        -------------     ------------
   Net property, plant and equipment         174,759          168,576
Purchased intangible assets, net             133,174          140,506
Goodwill                                     407,404          385,063
                                        -------------     ------------
Total assets                            $  1,693,679      $ 1,452,414
                                        =============     ============

  LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Accounts payable                     $    212,370      $   200,290
   Customer advances                         292,851          209,656
   Floor plan notes payable                   46,946           25,841
   Payroll-related obligations                43,180           43,978
   Income taxes                                9,767           17,575
   Accrued warranty                           37,046           35,760
   Other current liabilities                  95,683           73,842
   Revolving credit facility and current
    maturities of long-term debt              66,310           72,739
                                        -------------     ------------
          Total current liabilities          804,153          679,681
Long-term debt                                 3,048            3,209
Deferred income taxes                         63,919           66,543
Other long-term liabilities                   69,147           64,259
Minority interest                              2,817            2,629
Commitments and contingencies
Shareholders' equity                         750,595          636,093
                                        -------------     ------------
Total liabilities and shareholders'
 equity                                 $  1,693,679      $ 1,452,414
                                        =============     ============


                       OSHKOSH TRUCK CORPORATION
            CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (Unaudited)


                                                  Six Months Ended
                                                      March 31,
                                             -------------------------
                                                     2005        2004
                                             ------------- -----------
                                                    (In thousands)
Operating activities:
   Net income                                $     78,764  $   52,171
   Non-cash and other adjustments                  21,338      13,630
   Changes in operating assets and liabilities    (76,319)    (61,440)
                                             ------------- -----------
      Net cash provided from operating
       activities                                  23,783       4,361

Investing activities:
   Acquisition of businesses, net of cash
    acquired                                      (29,896)          -
   Additions to property, plant and equipment      (7,549)    (13,446)
   Proceeds from sale of assets                        13         104
   Decrease (increase) in other long-term assets    3,587      (4,195)
                                             ------------- -----------
      Net cash used for investing activities      (33,845)    (17,537)

Financing activities:
   Net borrowings (repayments) under revolving
    credit facility                                (8,230)     17,500
   Proceeds from exercise of stock options         18,116       4,471
   Proceeds from issuance of long-term debt             -         965
   Repayment of long-term debt                       (378)     (1,824)
   Dividends paid                                  (6,255)     (4,012)
                                             ------------- -----------
      Net cash provided from financing
       activities                                   3,253      17,100

Effect of exchange rate changes on cash               (94)      1,289
                                             ------------- -----------

Increase (decrease) in cash and cash equivalents   (6,903)      5,213

Cash and cash equivalents at beginning of period   30,081      19,245
                                             ------------- -----------

Cash and cash equivalents at end of period   $     23,178  $   24,458
                                             ============= ===========

Supplementary disclosure:
   Depreciation and amortization             $     16,559  $   13,213



                       OSHKOSH TRUCK CORPORATION
                          SEGMENT INFORMATION
                              (Unaudited)

                          Three Months Ended      Six Months Ended
                                March 31,              March 31,
                        ---------------------- -----------------------
                              2005       2004        2005        2004
                        ----------- ---------- ----------- -----------
                                         (In thousands)
Net sales to unaffiliated 
 customers:
   Fire and emergency    $ 213,225  $ 135,639  $  407,381  $  258,500
   Defense                 209,636    168,137     425,110     358,524
   Commercial              255,259    217,802     496,840     400,798
   Intersegment
    eliminations            (5,765)    (3,365)    (12,059)     (6,415)
                        ----------- ---------- ----------- -----------
      Consolidated       $ 672,355  $ 518,213  $1,317,272  $1,011,407
                        =========== ========== =========== ===========


Operating income (expense):
   Fire and emergency    $  19,003  $  11,211  $   37,448  $   22,817
   Defense (1)              49,381     23,035     101,082      60,199
   Commercial                6,458      9,439      12,083      16,626
   Corporate and other     (12,217)    (8,600)    (20,356)    (17,829)
                        ----------- ---------- ----------- -----------
      Consolidated       $  62,625  $  35,085  $  130,257  $   81,813
                        =========== ========== =========== ===========


Period-end backlog:
   Fire and emergency                          $  536,363  $  358,245
   Defense                                      1,010,511   1,012,552
   Commercial                                     317,172     238,870
                                               ----------- -----------
      Consolidated                             $1,864,046  $1,609,667
                                               =========== ===========


(1) Includes the following cumulative life-to-date adjustments to
    operating income due to an increase in margins on the Company's
    MTVR contract.


                               Three Months Ended    Six Months Ended
                                    March 31,            March 31,
                               -------------------  ------------------
                                    2005     2004       2005     2004
                               ----------  -------  --------- --------
                                 (In thousands, except percentages)

Increase in operating income   $  14,100   $    -   $ 22,600  $ 6,500
Increase in margin percentage        1.4%     0.0%       2.3%     0.8%
Margin percentage at period-end                          9.9%     6.3%

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