Gehl Company Comments On Outlook for Second Quarter

    WEST BEND, Wis.--June 26, 2001--Gehl Company , a manufacturer of light construction and agricultural equipment, today announced that based on continuing soft economic conditions and related weakness in the construction equipment market, particularly the steep drop in the telescopic handler market which is down 27% industry-wide through May, the Company expects to report net sales for the second quarter ending June 30, 2001 of $74.5 to $76.0 million and earnings in the range of $.52 to $.57 per diluted share. The Company previously projected net sales of $78.5 to $80.5 million and earnings of $.61 to $.67 per diluted share.
    Gehl reiterated its previous guidance for full year 2001 earnings of $1.52 to $1.62 per diluted share, although it said that results will likely be towards the lower end of the range.
    "While we are seeing some encouraging signs in our agricultural equipment business - and despite holding or gaining market share in a number of product lines across both our construction and agricultural businesses - we continue to be impacted by the slowdown in the economy and the resulting significant decline in industry-wide spending in the light construction equipment market," said William D. Gehl, Chairman, President and CEO. "We are not immune to the industry-wide impacts of lower rental rates for compact construction equipment - particularly telescopic handlers - as well as the adverse effects of the weak Euro on export shipments and a dealer community that is cautious about adding inventory. Although we are lowering our expectations for the current quarter, we believe that we should be able to meet the lower end of previous guidance for the full year."
    "In our agricultural business, we are making solid progress in introducing additional compact construction products to selected Ag equipment dealers, and we are experiencing strong demand for our recently launched round balers. Improved domestic milk prices - which we expect to continue - have also contributed to the strengthening of this business," said Gehl. "As for our construction business, when the market turns upward, we will be well positioned to capitalize on our diverse product mix, the ongoing introduction of new skid loaders and telescopic handlers, and the strength of our dealer distribution network. We remain committed to delivering high quality products to the marketplace and focused on creating value for our shareholders."

Update on Strategic Review Process

    As announced on May 9, 2001, Gehl is engaged in the process of reviewing its strategic alternatives, including the possible sale of the Company. Numerous U.S. and international entities have expressed interest in pursuing a business combination transaction or other strategic relationship with the Company. Gehl has begun the second stage of the review process, which the Company expects to continue over the next six to eight weeks.