Oshkosh Corp's materials handling revenue rose 13.4%. PHOTO: DREAMSTIME.COM

Oshkosh Corp revenues fell 7.4% last quarter as lower spending by the US government hurt sales of the company's medium and heavy tactical vehicles.

The results were propped up by solid performance in the access equipment business, which makes boom lifts, trailers, towing and recovery equipment. Revenue in the business rose 13.4%, accounting for nearly 63% of total revenue.
Oshkosh's defense division, which accounts for 10% of total sales, fell 67% in the quarter ended March 31.

The business also recorded an operating loss of USD12 million, compared to a positive revenue of USD34.5 million a year earlier.

Oshkosh attributes some of its revenue slip to the strong US dollar which gained about 89% against the major currencies in the quarter.

The dollar had surged about 9% from January to March against a basket of major currencies.

Meanwhile, first quarter revenues at Caterpillar Inc. fell 4% to USD12.702 billion, down from USD13.241 billion this time last year.

However, profits increased by USD120 million, due in part to the sale of Caterpillar's remaining interest in a third-party logistics business. Caterpillar sold a majority interest in the business in 2012, and divested the remaining interest in the first quarter of 2015.

"We delivered solid results for the first quarter of this year, including higher profit than in the first quarter of 2014," says chairman and chief executive Doug Oberhelman. "Our focus on operational improvement, including lean manufacturing and cost management, is helping in what is a tough time for some of our important cyclical businesses. We continue to execute on improving safety, quality, inventory turns, delivery performance and market position."

"We had a solid first quarter, which led to raising the profit outlook for 2015," Oberhelman notes. "However, we continue to face headwinds and uncertainty in 2015, and our outlook for the year reflects that.

"We expect sales and profit in each of the remaining three quarters of 2015 to be lower than the first quarter," he says, explaining that the first quarter is traditionally the most "favourable of the year".

"In addition, we expect some increase in research and development expense as we go through the year," he says.