 JLG-brand G12-55A telehandler |
JLG parent firm Oshkosh Corp of Oshkosh and industry giant United Rentals Inc of Stamford have delivered strong financial reports.
Oshkosh CorpOshkosh reports that continued replacement demand for aerial work platforms in North America, favourable pricing and a military contract spurred a 15% sales increase in its JLG-led access equipment segment for the fiscal quarter ended 31 December.
The segment had sales of USD668.6 million - USD316.5 million from JLG aerial work platforms, USD217.7 million from JLG, SkyTrak and Lull telehandlers and USD134.4 million from other products. The segment had sales of USD581.3 million in the previous year's comparable quarter.
Agreement on the final pricing of a multi-year US military contract provided a benefit of USD7.5 million.
"The access equipment segment results significantly exceeded our expectations in the first quarter," says Wilson Jones, Oshkosh president and chief operating officer. "Orders received in the first quarter ... reflected a stronger mix of aerial work platforms. We believe this was due to some customers deciding to swap the timing of their aerial work platform and telehandler purchases so they could avoid the price increase on certain aerial work platform models associated with the changeover to Tier 4 engines."
As a result, Oshkosh had a mix more heavily weighted to aerial work platforms than expected, Jones reports.
In addition, Jones has discussed Oshkosh's nearly-complete negotiations with national rental companies.
"The North American access equipment market remains strong, and the rental companies have positive outlooks," he says.
Within its access equipment segment, Oshkosh "saw a nice year-over-year order improvement in Europe in the first quarter (with backlog at 31 December) up sharply over the prior year," Jones notes.
For all operations for the first quarter ended 31 December, the Oshkosh-based corporation reports a profit of USD54.9 million on sales of USD1.53 billion, versus USD46.5 million on USD1.75 billion in the previous year's comparable quarter. Lower defence segment performance accounted for the sales decline.
United RentalsUnited Rentals has reported a profit of USD387 million on 2013 sales of USD4.96 billion, in comparison to profit of USD75 million on 2012 sales of USD4.12 billion.
"We had a record year in 2013, but we're still hungry," says Michael Kneeland, chief executive officer. "We're still thinking about new ways and we're also looking at our business from every angle, exploring every possibility for profitable growth. Most importantly, we're moving forward from an unparalleled position of strength."
As of 31 December, the firm's fleet included approximately 410,000 rental units in about 3,100 classes of equipment. Backhoes, skid-steer loaders, forklifts, earthmoving equipment and materials handling equipment accounted for about 44% of equipment rental revenue, and boom lifts, scissor lifts and other aerial work platforms represented 39%.
The age of fleet was 45.2 months at 31 December 2013 versus 47.2 months at 31 December 2012.
In addition to rejuvenating its rental fleet, United Rentals sells new equipment. Brands include Genie, JLG and Skyjack aerial lifts; SkyTrak and JLG rough-terrain reach forklifts; and Terex telehandlers; and Takeuchi skid-steer loaders. Other new equipment sales involve compactors, generators, pumps and compressors.
"In 2014, based on our analyses of industry forecasts and macroeconomic indicators, we expect that the majority of our end markets will continue to recover and drive demand for equipment rental services," United Rentals says in a forecast. "Specifically, we expect overall North American construction activity and equipment rental revenue to increase approximately 8%."
United Rentals pursues a lean manufacturing philosophy, initially with eight branches in pilot mode using the kaizen process developed as the Toyota Motor Corp production system to eliminate waste in operations. During 2014, United Rentals plans to target the program for nearly 200 branches out of the total network of 832 rental locations - 718 in 49 US states and 114 in 10 Canadian provinces.
On 30 April 2012, United Rentals
acquired RSC Holdings Inc of Scottsdale, Arizona for USD2.59 billion including USD1.16 billion in cash, USD1.40 billion in stock consideration and USD29 million in share-based compensation awards. United Rentals says its RSC merger-related costs were USD19 million in 2011, USD111 million in 2012 and USD9 million in 2013.