News Details
Oshkosh Corporation Reports Fiscal 2018 Fourth Quarter and Full Year Results
Nov. 01, 2018
Announces Fiscal 2019
Announces 12.5 Percent Increase in Quarterly Cash Dividend to
Consolidated net sales in the fourth quarter of fiscal 2018 increased
4.8 percent compared to the fourth quarter of fiscal 2017 to
Consolidated operating income increased 49.7 percent to
“Our strong fourth quarter capped off a successful year for
“The efforts of our dedicated team members throughout the year resulted
in full year fiscal 2018 diluted earnings per share of
“Based on expected continued favorable end markets, strong backlogs
entering the year and our industry-leading product offerings, we are
initiating a fiscal 2019 diluted earnings per share estimate range of
Factors affecting fourth quarter results for the Company’s business segments included:
Access Equipment - Access equipment segment net sales increased
27.2 percent to
Access equipment segment operating income increased 103.5 percent to
Access equipment segment results for the fourth quarter of fiscal 2018
included pre-tax charges and inefficiencies associated with previously
announced restructuring actions of
Defense - Defense segment net sales for the fourth quarter of
fiscal 2018 decreased 22.2 percent to
Defense segment operating income decreased 14.5 percent to
Fire & Emergency - Fire & emergency segment net sales for the
fourth quarter of fiscal 2018 increased 2.1 percent to
Fire & emergency segment operating income increased 14.7 percent to
Commercial - Commercial segment net sales for the fourth quarter
of fiscal 2018 decreased 2.2 percent to
Commercial segment operating income increased 52.6 percent to
Corporate - Corporate operating costs decreased
Interest Expense Net of Interest Income - Interest expense net of
interest income decreased
Provision for Income Taxes - The Company recorded income tax
expense of
Share Repurchases -The Company deployed cash of
Full-Year Results
The Company reported net sales for fiscal 2018 of
Fiscal 2019 Expectations
The Company announced its fiscal 2019 diluted earnings per share
estimate range of
Dividend Announcement
The Company’s Board of Directors today declared a quarterly cash
dividend of
Conference Call
The Company will comment on its fiscal 2018 fourth quarter earnings and
its full-year fiscal 2019 outlook during a conference call at
Forward Looking Statements
This news release contains statements that the Company believes to be
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements other than
statements of historical fact, including, without limitation, statements
regarding the Company’s future financial position, business strategy,
targets, projected sales, costs, earnings, capital expenditures, debt
levels and cash flows, and plans and objectives of management for future
operations, are forward-looking statements. When used in this news
release, words such as “may,” “will,” “expect,” “intend,” “estimate,”
“anticipate,” “believe,” “should,” “project” or “plan” or the negative
thereof or variations thereon or similar terminology are generally
intended to identify forward-looking statements. These forward-looking
statements are not guarantees of future performance and are subject to
risks, uncertainties, assumptions and other factors, some of which are
beyond the Company’s control, which could cause actual results to differ
materially from those expressed or implied by such forward-looking
statements. These factors include the cyclical nature of the Company’s
access equipment, commercial and fire & emergency markets, which are
particularly impacted by the strength of
About
Founded in 1917,
Today,
®, ™ All brand names referred to in this news release are
trademarks of
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In millions, except share and per share amounts; unaudited) |
||||||||||||||||
Three Months Ended |
Fiscal Year Ended |
|||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net sales | $ | 2,057.0 | $ | 1,963.0 | $ | 7,705.5 | $ | 6,829.6 | ||||||||
Cost of sales | 1,681.8 | 1,636.5 | 6,349.8 | 5,655.2 | ||||||||||||
Gross income | 375.2 | 326.5 | 1,355.7 | 1,174.4 | ||||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 164.6 | 180.9 | 663.9 | 665.6 | ||||||||||||
Amortization of purchased intangibles | 9.2 | 11.1 | 38.3 | 45.8 | ||||||||||||
Total operating expenses | 173.8 | 192.0 | 702.2 | 711.4 | ||||||||||||
Operating income | 201.4 | 134.5 | 653.5 | 463.0 | ||||||||||||
Other income (expense): | ||||||||||||||||
Interest expense | (14.0 | ) | (14.7 | ) | (70.9 | ) | (59.8 | ) | ||||||||
Interest income | 3.6 | 1.7 | 15.3 | 4.9 | ||||||||||||
Miscellaneous, net | (1.2 | ) | 0.1 | (3.3 | ) | 3.2 | ||||||||||
Income before income taxes and earnings of unconsolidated affiliates | 189.8 | 121.6 | 594.6 | 411.3 | ||||||||||||
Provision for income taxes | 38.3 | 28.3 | 123.8 | 127.2 | ||||||||||||
Income before earnings of unconsolidated affiliates | 151.5 | 93.3 | 470.8 | 284.1 | ||||||||||||
Equity in earnings (losses) of unconsolidated affiliates | (0.2 | ) | 0.2 | 1.1 | 1.5 | |||||||||||
Net income | $ | 151.3 | $ | 93.5 | $ | 471.9 | $ | 285.6 | ||||||||
Earnings per share: | ||||||||||||||||
Basic | $ | 2.08 | $ | 1.25 | $ | 6.38 | $ | 3.82 | ||||||||
Diluted | 2.05 | 1.23 | 6.29 | 3.77 | ||||||||||||
Basic weighted-average shares outstanding | 72,880,114 | 74,914,622 | 74,001,582 | 74,674,115 | ||||||||||||
Dilutive equity-based compensation awards | 874,078 | 1,186,284 | 980,417 | 1,115,930 | ||||||||||||
Diluted weighted-average shares outstanding | 73,754,192 | 76,100,906 | 74,981,999 | 75,790,045 |
CONDENSED CONSOLIDATED BALANCE SHEETS (In millions; unaudited) |
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|
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2018 | 2017 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 454.6 | $ | 447.0 | ||||
Receivables, net | 1,521.6 | 1,306.3 | ||||||
Inventories, net | 1,227.7 | 1,198.4 | ||||||
Other current assets | 66.0 | 88.1 | ||||||
Total current assets | 3,269.9 | 3,039.8 | ||||||
Property, plant and equipment: | ||||||||
Property, plant and equipment | 1,222.7 | 1,188.8 | ||||||
Accumulated depreciation | (741.6 | ) | (718.9 | ) | ||||
Property, plant and equipment, net | 481.1 | 469.9 | ||||||
|
1,007.9 | 1,013.0 | ||||||
Purchased intangible assets, net | 469.4 | 507.8 | ||||||
Other long-term assets | 65.9 | 68.4 | ||||||
Total assets | $ | 5,294.2 | $ | 5,098.9 | ||||
Liabilities and Shareholders' Equity | ||||||||
Current liabilities: | ||||||||
Revolving credit facilities and current maturities of long-term debt | $ | — | $ | 23.0 | ||||
Accounts payable | 776.9 | 651.0 | ||||||
Customer advances | 444.9 | 513.4 | ||||||
Payroll-related obligations | 192.5 | 191.8 | ||||||
Other current liabilities | 275.8 | 303.9 | ||||||
Total current liabilities | 1,690.1 | 1,683.1 | ||||||
Long-term debt, less current maturities | 818.0 | 807.9 | ||||||
Other long-term liabilities | 272.6 | 300.5 | ||||||
Commitments and contingencies | ||||||||
Shareholders' equity | 2,513.5 | 2,307.4 | ||||||
Total liabilities and shareholders' equity | $ | 5,294.2 | $ | 5,098.9 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions; unaudited) |
||||||||
Fiscal Year Ended |
||||||||
2018 | 2017 | |||||||
Operating activities: | ||||||||
Net income | $ | 471.9 | $ | 285.6 | ||||
Depreciation and amortization | 120.5 | 130.3 | ||||||
Stock-based compensation expense | 26.7 | 22.4 | ||||||
Deferred income taxes | (3.1 | ) | 7.8 | |||||
Loss (gain) on sale of assets | 1.1 | (6.6 | ) | |||||
Foreign currency transaction losses | 1.4 | 1.6 | ||||||
Debt extinguishment | 10.3 | — | ||||||
Other non-cash adjustments | 2.3 | 0.1 | ||||||
Changes in operating assets and liabilities | (194.8 | ) | (194.7 | ) | ||||
Net cash provided by operating activities | 436.3 | 246.5 | ||||||
Investing activities: | ||||||||
Additions to property, plant and equipment | (95.3 | ) | (85.8 | ) | ||||
Additions to equipment held for rental | (4.8 | ) | (27.4 | ) | ||||
Proceeds from sale of property, plant and equipment | 5.7 | 0.8 | ||||||
Proceeds from sale of equipment held for rental | 5.8 | 49.5 | ||||||
Other investing activities | (1.8 | ) | (2.3 | ) | ||||
Net cash used by investing activities | (90.4 | ) | (65.2 | ) | ||||
Financing activities: | ||||||||
Proceeds from issuance of debt | 639.4 | 5.9 | ||||||
Repayments of debt | (653.8 | ) | (23.0 | ) | ||||
Debt issuance costs | (12.9 | ) | — | |||||
Repurchases of common stock | (257.0 | ) | (4.8 | ) | ||||
Dividends paid | (71.2 | ) | (62.8 | ) | ||||
Proceeds from exercise of stock options | 16.6 | 39.9 | ||||||
Net cash used by financing activities | (338.9 | ) | (44.8 | ) | ||||
Effect of exchange rate changes on cash | 0.6 | (11.4 | ) | |||||
Increase in cash and cash equivalents | 7.6 | 125.1 | ||||||
Cash and cash equivalents at beginning of period | 447.0 | 321.9 | ||||||
Cash and cash equivalents at end of period | $ | 454.6 | $ | 447.0 |
SEGMENT INFORMATION (In millions; unaudited) |
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Three Months Ended |
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2018 | 2017 | |||||||||||||||||||||||
External
Customers |
Inter-
segment |
Net
Sales |
External
Customers |
Inter-
segment |
Net
Sales |
|||||||||||||||||||
Access equipment | ||||||||||||||||||||||||
Aerial work platforms | $ | 555.7 | $ | — | $ | 555.7 | $ | 443.4 | $ | — | $ | 443.4 | ||||||||||||
Telehandlers | 284.3 | — | 284.3 | 204.0 | — | 204.0 | ||||||||||||||||||
Other | 220.6 | — | 220.6 | 186.4 | — | 186.4 | ||||||||||||||||||
Total access equipment | 1,060.6 | — | 1,060.6 | 833.8 | — | 833.8 | ||||||||||||||||||
Defense | 464.1 | 0.5 | 464.6 | 596.5 | 0.3 | 596.8 | ||||||||||||||||||
Fire & emergency | 279.4 | 4.3 | 283.7 | 273.9 | 4.1 | 278.0 | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||
Concrete placement | 120.3 | — | 120.3 | 118.4 | — | 118.4 | ||||||||||||||||||
Refuse collection | 103.0 | — | 103.0 | 112.0 | — | 112.0 | ||||||||||||||||||
Other | 29.2 | 1.7 | 30.9 | 28.2 | 1.3 | 29.5 | ||||||||||||||||||
Total commercial | 252.5 | 1.7 | 254.2 | 258.6 | 1.3 | 259.9 | ||||||||||||||||||
Corporate & eliminations | 0.4 | (6.5 | ) | (6.1 | ) | 0.2 | (5.7 | ) | (5.5 | ) | ||||||||||||||
$ | 2,057.0 | $ | — | $ | 2,057.0 | $ | 1,963.0 | $ | — | $ | 1,963.0 |
Fiscal Year Ended |
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2018 | 2017 | |||||||||||||||||||||||
External
Customers |
Inter-
segment |
Net
Sales |
External
Customers |
Inter-
segment |
Net
Sales |
|||||||||||||||||||
Access equipment | ||||||||||||||||||||||||
Aerial work platforms | $ | 2,017.2 | $ | — | $ | 2,017.2 | $ | 1,629.6 | $ | — | $ | 1,629.6 | ||||||||||||
Telehandlers | 948.9 | — | 948.9 | 661.8 | — | 661.8 | ||||||||||||||||||
Other | 810.7 | — | 810.7 | 735.0 | — | 735.0 | ||||||||||||||||||
Total access equipment | 3,776.8 | — | 3,776.8 | 3,026.4 | — | 3,026.4 | ||||||||||||||||||
Defense | 1,827.3 | 1.6 | 1,828.9 | 1,818.6 | 1.5 | 1,820.1 | ||||||||||||||||||
Fire & emergency | 1,053.6 | 16.1 | 1,069.7 | 1,015.4 | 15.5 | 1,030.9 | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||
Concrete placement | 491.8 | — | 491.8 | 474.0 | — | 474.0 | ||||||||||||||||||
Refuse collection | 438.3 | — | 438.3 | 391.1 | — | 391.1 | ||||||||||||||||||
Other | 116.7 | 7.9 | 124.6 | 99.3 | 5.9 | 105.2 | ||||||||||||||||||
Total commercial | 1,046.8 | 7.9 | 1,054.7 | 964.4 | 5.9 | 970.3 | ||||||||||||||||||
Corporate & eliminations | 1.0 | (25.6 | ) | (24.6 | ) | 4.8 | (22.9 | ) | (18.1 | ) | ||||||||||||||
$ | 7,705.5 | $ | — | $ | 7,705.5 | $ | 6,829.6 | $ | — | $ | 6,829.6 |
Three Months Ended |
Fiscal Year Ended |
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2018 | 2017 | 2018 | 2017 | |||||||||||||
Operating income (loss): | ||||||||||||||||
Access equipment | $ | 127.0 | $ | 62.4 | $ | 387.8 | $ | 259.1 | ||||||||
Defense | 62.4 | 73.0 | 222.9 | 207.9 | ||||||||||||
Fire & emergency | 39.7 | 34.6 | 137.2 | 104.2 | ||||||||||||
Commercial | 17.7 | 11.6 | 67.5 | 43.8 | ||||||||||||
Corporate | (45.3 | ) | (47.1 | ) | (161.9 | ) | (152.0 | ) | ||||||||
Eliminations | (0.1 | ) | — | — | — | |||||||||||
$ | 201.4 | $ | 134.5 | $ | 653.5 | $ | 463.0 | |||||||||
|
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2018 | 2017 | |||||||||||||||
Period-end backlog: | ||||||||||||||||
Access equipment | $ | 962.4 | $ | 452.2 | ||||||||||||
Defense | 1,856.4 | 2,086.2 | ||||||||||||||
Fire & emergency | 978.1 | 931.6 | ||||||||||||||
Commercial | 376.0 | 321.0 | ||||||||||||||
$ | 4,172.9 | $ | 3,791.0 |
Non-GAAP Financial Measures
The Company reports its financial results in accordance with generally
accepted accounting principles in
Three Months Ended |
Fiscal Year Ended |
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2018 | 2017 | 2018 | 2017 | |||||||||||||
Access equipment segment operating income (GAAP) | $ | 127.0 | $ | 62.4 | $ | 387.8 | $ | 259.1 | ||||||||
Costs and inefficiencies related to restructuring actions | 1.3 | 15.5 | 29.5 | 43.3 | ||||||||||||
Adjusted access equipment segment operating
income (non-GAAP) |
$ | 128.3 | $ | 77.9 | $ | 417.3 | $ | 302.4 | ||||||||
Defense segment operating income (GAAP) | $ | 62.4 | $ | 73.0 | $ | 222.9 | $ | 207.9 | ||||||||
Litigation settlement | (19.0 | ) | — | (19.0 | ) | — | ||||||||||
Adjusted defense segment operating income (non-GAAP) | $ | 43.4 | $ | 73.0 | $ | 203.9 | $ | 207.9 | ||||||||
Commercial segment operating income (GAAP) | $ | 17.7 | $ | 11.6 | $ | 67.5 | $ | 43.8 | ||||||||
Restructuring costs | 1.6 | — | 5.9 | — | ||||||||||||
Business interruption insurance proceeds | (6.6 | ) | — | (6.6 | ) | — | ||||||||||
Loss on sale of a small product line | 1.4 | — | 1.4 | — | ||||||||||||
Adjusted commercial segment operating income (non-GAAP) | $ | 14.1 | $ | 11.6 | $ | 68.2 | $ | 43.8 | ||||||||
Consolidated operating income (GAAP) | $ | 201.4 | $ | 134.5 | $ | 653.5 | $ | 463.0 | ||||||||
Costs and inefficiencies related to restructuring actions | 2.9 | 15.5 | 35.4 | 43.3 | ||||||||||||
Litigation settlement | (19.0 | ) | — | (19.0 | ) | — | ||||||||||
Business interruption insurance proceeds | (6.6 | ) | — | (6.6 | ) | — | ||||||||||
Loss on sale of a small product line | 1.4 | — | 1.4 | — | ||||||||||||
Adjusted consolidated operating income (non-GAAP) | $ | 180.1 | $ | 150.0 | $ | 664.7 | $ | 506.3 | ||||||||
Interest expense net of interest income (GAAP) | $ | (10.4 | ) | $ | (13.0 | ) | $ | (55.6 | ) | $ | (54.9 | ) | ||||
Debt extinguishment costs | — | — | 9.9 | — | ||||||||||||
Adjusted interest expense net of interest income (non-GAAP) | $ | (10.4 | ) | $ | (13.0 | ) | $ | (45.7 | ) | $ | (54.9 | ) |
Three Months Ended
|
Fiscal Year Ended
|
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2018 | 2017 | 2018 | 2017 | ||||||||||||
Provision for income taxes (GAAP) | $ | 38.3 | $ | 28.3 | $ | 123.8 | $ | 127.2 | |||||||
Income tax benefit of costs and inefficiencies related to restructuring actions | 0.5 | 4.2 | 7.9 | 7.1 | |||||||||||
Income tax expense on litigation settlement | (3.6 | ) | — | (3.6 | ) | — | |||||||||
Income tax expense on business interruption insurance proceeds | (1.7 | ) | — | (1.7 | ) | — | |||||||||
Income tax benefit of loss on sale of a small product line | 0.4 | — | 0.4 | — | |||||||||||
Income tax benefit of debt extinguishment costs | — | — | 2.2 | — | |||||||||||
Revaluation of net deferred tax liabilities | — | — | 30.2 | — | |||||||||||
Repatriation tax | 2.0 | — | (19.5 | ) | — | ||||||||||
Adjusted provision for income taxes (non-GAAP) | $ | 35.9 | $ | 32.5 | $ | 139.7 | $ | 134.3 | |||||||
Net income (GAAP) | $ | 151.3 | $ | 93.5 | $ | 471.9 | $ | 285.6 | |||||||
Costs and inefficiencies related to restructuring actions, net of tax | 2.4 | 11.3 | 27.5 | 36.2 | |||||||||||
Litigation settlement, net of tax | (15.4 | ) | — | (15.4 | ) | — | |||||||||
Business interruption insurance proceeds, net of tax | (4.9 | ) | — | (4.9 | ) | — | |||||||||
Loss on sale of a small product line, net of tax | 1.0 | — | 1.0 | — | |||||||||||
Debt extinguishment costs, net of tax | — | — | 7.7 | — | |||||||||||
Revaluation of net deferred tax liabilities | — | — | (30.2 | ) | — | ||||||||||
Repatriation tax | (2.0 | ) | — | 19.5 | — | ||||||||||
Adjusted net income (non-GAAP) | $ | 132.4 | $ | 104.8 | $ | 477.1 | $ | 321.8 | |||||||
Earnings per share-diluted (GAAP) | $ | 2.05 | $ | 1.23 | $ | 6.29 | $ | 3.77 | |||||||
Costs and inefficiencies related to restructuring actions, net of tax | 0.05 | 0.15 | 0.37 | 0.48 | |||||||||||
Litigation settlement, net of tax | (0.21 | ) | — | (0.21 | ) | — | |||||||||
Business interruption insurance proceeds, net of tax | (0.07 | ) | — | (0.07 | ) | — | |||||||||
Loss on sale of a small product line, net of tax | 0.01 | — | 0.01 | — | |||||||||||
Debt extinguishment costs, net of tax | — | — | 0.10 | — | |||||||||||
Revaluation of net deferred tax liabilities | — | — | (0.39 | ) | — | ||||||||||
Repatriation tax | (0.03 | ) | — | 0.26 | — | ||||||||||
Adjusted earnings per share-diluted (non-GAAP) | $ | 1.80 | $ | 1.38 | $ | 6.36 | $ | 4.25 |
_____________________________________ |
1 This news release refers to GAAP ( |
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