Oshkosh Truck Reports Net Income Up 23% in First Quarter
OSHKOSH, Wis.--Jan. 25, 2001--Oshkosh Truck Corporation today reported that first quarter net income before extraordinary charge increased 23 percent to $8.2 million, or $0.48 per share, on sales of $282 million for the quarter ended December 31, 2000. This compares with net income before extraordinary charge of $6.7 million, or $0.46 per share, on sales of $244 million for last year's first quarter.Sales increased 15.4 percent in the first quarter. Operating income increased 7.0 percent to $17.8 million, or 6.3 percent of sales, compared to $16.6 million, or 6.8 percent of sales, in the prior year's first quarter.
The company's first quarter performance reflects double-digit sales and operating income growth in its fire and emergency and defense businesses, as concrete placement and refuse product sales softened in the company's commercial segment.
"During what is traditionally the seasonally slowest quarter of the year for the company, we have been focused on completion of the Oshkosh facility expansion and several significant defense initiatives which are important to the company's long-term growth, including the Family of Medium Tactical Vehicles (FMTV) development contract proposal and the negotiation of a new five-year Family of Heavy Tactical Vehicles (FHTV) contract." commented Robert G. Bohn, chairman, president and chief executive officer.
Bohn continued, "We experienced some softness in our commercial markets in the first quarter, but with the strength of new business in our fire and emergency and defense segments, we re-affirm our estimate of annual earnings per share of about $3.45. That's an increase of about 17% over fiscal 2000."
Factors affecting first quarter results for the company's business segments included:
Fire and emergency--Fire and emergency segment sales increased 24 percent, to $93.7 million, for the quarter. Operating income was up 88 percent, to $7.4 million, or 7.8 percent of sales, compared to prior year income of $3.9 million, or 5.2 percent of sales. Sales and earnings were strong across all product lines in the segment, and comparisons to prior year were buoyed by the adverse effects of an ERP installation on prior year results. Sales and operating income for the first quarter of fiscal 2001 also included the operations of Medtec Ambulance Corporation ("Medtec") for the two months following its acquisition on October 30, 2000.
Defense--Defense sales increased 55 percent, to $81.7 million, for the quarter due to strong export sales and the continued ramp-up of production under the company's contract to supply medium trucks to the U.S. Marines under the Medium Tactical Vehicle Replacement (MTVR) contract.
Operating income was up 14 percent, to $8.5 million, or 10.5 percent of sales, compared to prior year income of $7.5 million, or 14.2 percent of sales. Parts sales were strong in the quarter, and bid and proposal spending was lower than estimated. Prior year results were also positively impacted by a favorable mix of parts sales.
Commercial--Commercial sales declined 8.1 percent, to $106.0 million, for the quarter. Operating income declined 31.8% to $6.2 million, or 5.8 percent of sales, due to the lower sales volumes and two week-long production shutdowns. Concrete placement and refuse sales were down 9.3 percent and 6.0 percent, respectively, from first quarter 2000 results. Prior year concrete placement sales were favorably impacted by earlier-than-normal orders due to perceived tightness in truck chassis deliveries. This year, concrete placement sales have declined due to lower housing starts and customer concerns regarding general economic conditions. Refuse sales declined this year due to lower orders from the large, national waste haulers.
Corporate and other--Operating expenses and inter-segment profit elimination increased from $3.8 million to $4.3 million. Net interest expense for the quarter decreased to $4.5 million compared to $5.6 million in the prior year as a result of the company's November 1999 equity offering and related debt prepayment despite interest expense associated with the October 30, 2000 acquisition of Medtec.
Dividend Announcement
Oshkosh Truck Corporation's Board of Directors declared a quarterly dividend of $0.07500 per share for Class A Common Stock and $0.08625 per share for Common Stock. These dividends, unchanged from the prior quarter, will be payable February 13, 2001 to shareholders of record as of February 2, 2001.
Oshkosh Truck Corporation is a leading manufacturer of specialty trucks and truck bodies for the defense, fire and emergency, concrete placement and refuse hauling markets. Oshkosh Truck is a Fortune 1000 company with products marketed under the Oshkosh, Pierce, McNeilus and Medtec brand names. The company is headquartered in Oshkosh, Wis., and had annual sales of $1.324 billion in fiscal 2000.
OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
December 31,
--------------------------
2000 1999
------------ ------------
Net sales $ 281,517 $ 243,867
Cost of sales 238,250 203,890
------------ ------------
Gross income 43,267 39,977
Operating expenses:
Selling, general and administrative 22,619 20,578
Amortization of goodwill and other
intangibles 2,864 2,772
------------ ------------
Total operating expenses 25,483 23,350
------------ ------------
Operating income 17,784 16,627
Other income (expense):
Interest expense (4,658) (5,786)
Interest income 169 166
Miscellaneous, net - 114
------------ ------------
(4,489) (5,506)
------------ ------------
Income before items noted below 13,295 11,121
Provision for income taxes 5,375 4,740
------------ ------------
7,920 6,381
Equity in earnings of unconsolidated
partnership, net of income taxes 303 315
------------ ------------
Income from operations 8,223 6,696
Extraordinary charge for early retirement of
debt, net of income tax benefit - (581)
------------ ------------
Net income $ 8,223 $ 6,115
============ ============
Earnings (loss) per share:
Income from operations $ 0.49 $ 0.46
Extraordinary charge - (0.04)
------------ ------------
Net income $ 0.49 $ 0.42
============ ============
Earnings (loss) per share assuming dilution:
Income from operations $ 0.48 $ 0.46
Extraordinary charge - (0.04)
------------ ------------
Net income $ 0.48 $ 0.42
============ ============
Weighted average shares outstanding:
Basic 16,669 14,399
Assuming dilution 17,071 14,709
Cash dividends:
Class A Common Stock $ 0.07500 $ 0.07500
Common Stock $ 0.08625 $ 0.08625
OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
December 31, September 30,
2000 2000
------------ -------------
(Unaudited)
(In thousands)
ASSETS
Current assets:
Cash and cash equivalents $ 4,854 $ 13,569
Receivables, net 102,163 106,805
Inventories 236,373 201,210
Prepaid expenses 6,076 5,424
Deferred income taxes 13,608 14,708
------------ -------------
Total current assets 363,074 341,716
Investment in unconsolidated partnership 15,954 15,179
Other long-term assets 13,408 9,995
Property, plant and equipment 213,695 206,507
Less accumulated depreciation (90,231) (87,748)
------------ -------------
Net property, plant and equipment 123,464 118,759
Goodwill and other intangible assets, net 314,102 310,731
------------ -------------
Total assets $830,002 $ 796,380
============ =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 63,249 $ 84,215
Floor plan notes payable 36,085 23,925
Customer advances 88,659 58,493
Payroll-related obligations 16,114 23,465
Accrued warranty 14,849 15,519
Other current liabilities 59,641 52,310
Revolving credit facility and current
maturities of long-term debt 17,606 8,544
------------ -------------
Total current liabilities 296,203 266,471
Long-term debt 151,511 154,238
Deferred income taxes 45,705 46,414
Other long-term liabilities 28,308 28,200
Commitments and contingencies
Shareholders' equity 308,275 301,057
------------ -------------
Total liabilities and shareholders' equity $830,002 $ 796,380
============ =============
OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
December 31,
------------------------------------------
2000 1999
------------------ ------------------
(In thousands)
Operating activities:
Income from operations $ 8,223 $ 6,696
Non-cash adjustments 7,795 4,202
Changes in operating assets
and liabilities (8,015) (5,624)
------------------ ------------------
Net cash provided from
operating activities 8,003 5,274
Investing activities:
Acquisition of businesses,
net of cash acquired (14,423) (5,893)
Additions to property,
plant and equipment (4,244) (4,486)
Increase in other long-term
assets (3,008) (1,005)
------------------ ------------------
Net cash used for
investing activities (21,675) (11,384)
Financing activities:
Net borrowings under
revolving credit facility 8,600 6,000
Repayment of long-term debt (2,265) (93,709)
Proceeds from Common Stock
offering - 93,736
Costs of Common Stock
offering - (341)
Dividends paid (1,433) (1,102)
Other 55 28
------------------ ------------------
Net cash provided from
financing activities 4,957 4,612
------------------ ------------------
Decrease in cash and cash
equivalents (8,715) (1,498)
Cash and cash equivalents at
beginning of period 13,569 5,137
------------------ ------------------
Cash and cash equivalents at
end of period $ 4,854 $ 3,639
================== ==================
Supplementary disclosure:
Depreciation and
amortization $ 7,080 $ 5,780
OSHKOSH TRUCK CORPORATION
SEGMENT INFORMATION
(Unaudited)
Three Months Ended
December 31,
------------------------------------------
2000 1999
------------------ ------------------
Net sales to unaffiliated
customers:
Commercial $ 106,026 $ 115,394
Fire and emergency 93,746 75,577
Defense 81,745 52,896
------------------ ---------------------
Consolidated $ 281,517 $ 243,867
================== =====================
Operating income (expense):
Commercial $ 6,172 $ 9,054
Fire and emergency 7,355 3,915
Defense 8,546 7,495
Corporate and other (4,289) (3,837)
------------------ ---------------------
Consolidated $ 17,784 $ 16,627
================== =====================
Backlog:
Commercial $ 132,854 $ 187,587
Fire and emergency 264,901 221,098
Defense 241,393 150,048
------------------ ---------------------
Consolidated $ 639,148 $ 558,733
================== =====================