Genie parent firm Terex Corp and JLG parent Oshkosh Corp report higher access equipment sales for their respective quarters ended 30 September.

Meanwhile, the Oshkosh board of directors is recommending that shareholders reject the tender offer from an activist investor.

Terex sales increase

Third quarter sales for the Terex aerial work platforms (AWP) segment increased USD77.4 million, or 17.2%, to USD526.1 million versus the third quarter of 2011 and, with 29%, constituted the company's largest segment by sales.

Terex cites continued replacement demand in the North American rental channel, "some evidence of fleet growth" for AWPs, net sales from an acquired business and moderate growth in European and Latin American markets.

Income from AWP operations was USD59.3 million, or 11.3% of net sales, compared to USD27.0 million, or 6.0% of net sales last year. "Income from operations benefited primarily from improved price realisation, volume and customer mix," Terex says. Recently, the company announced an average price increase of 3.4% effective for AWP deliveries beginning in January 2013.

AWP backlog was USD376 million as of 30 September - down from USD511 million on 30 June.

Terex Chairman and CEO Ronald M DeFeo comments regarding AWPs: "You still have very big fleets from 2005, 2006 and 2007 that need to be replaced. So while it's difficult for us to predict quarter to quarter, I think at least for the next several years the market environment in this product category can be confidently said to be strong, barring any kind of calamity that we can't see at this stage."

For the quarter ended 30 September, Westport-based Terex reports profit from continuing operations of USD30.2 million on sales of USD1.82 billion versus profit of USD36.9 million on sales of USD1.80 billion for the previous year's comparable period.

Excluding the impact of the 16 August 2011 acquisition of Demag Cranes AG, net sales decreased approximately 8%, of which 5.4% relates to foreign currency fluctuations, from the comparable prior year period.

In a 30 October announcement, Terex says it plans in December to create a service provider known as Terex Services North America that the company will align under the Terex business segment that markets AWPs principally under the Terex and Genie brand names. Terex Services NA will have a service network of 900 employees operating in more than 50 markets.

Terex Services NA will combine the existing operations of Terex Equipment Services and Crane America Services that "have already been very successful in their own right," says Siva Balakrishnan, Terex AWP vice president and general manager of the combined entity. "Terex Services customers will now benefit from a deeper pool of resources and expanded geographical coverage as well as the combined ability of Terex Services to service a broader range of products at their sites."

Oshkosh access equipment sales increase

Fourth quarter sales to external customers for the Oshkosh access equipment segment increased 15.6% to USD716.0 million compared to the same time last year. Higher unit volumes in North America and the realisation of previously announced price increases accounted for the increase.

Results included a high mix of telehandler sales.

Including intersegment sales to the Oshkosh defense unit, access equipment segment sales increased 6.4% for the quarter compared with the prior year quarter. Oshkosh says intersegment sales declined in the fourth quarter of fiscal 2012. By itself, the defence segment sales decreased 18.6%.

For the fourth quarter, Oshkosh, based in Oshkosh, reports profit from continuing operations of USD77.6 million on sales of USD2.96 billion compared to profit of USD40.3 million on sales of USD2.11 billion for the comparable prior period. For the sales decrease, Oshkosh says double-digit increases in external sales in all non-defense segments were more than offset by lower sales in the defense segment.

The backlog for access equipment orders was USD361.1 million as of 30 September. 2012. That compares to USD729.2 million one year earlier.

For the 2012 fiscal year, Oshkosh Corp had profit of USD231.9 million on sales of USD8.18 billion. That compares to 2011 profit of USD273.4 million on sales of USD7.57 billion.

Oshkosh recommends rejection of Icahn offer

Meanwhile, on 26 October, the Oshkosh board of directors pointedly rejected and negatively characterised activist investor Carl Icahn's 17 October "unsolicited, highly conditional and opportunistic tender offer" for Oshkosh shares at USD32.50 each or about USD3 billion.

The board says the offer "is inadequate, undervalues the company and is not in the best interests of all Oshkosh shareholders". The board recommends that shareholders reject "Icahn's offer and not tender any of their shares".

Oshkosh chairman Richard M Donnelly says: "We believe Mr. Icahn's offer is yet another attempt by Mr. Icahn to enrich himself at the expense of all other Oshkosh shareholders."

At the Oshkosh annual meeting on 27 January 2012, shareholders elected a slate of 13 company-backed director nominees and rejected Icahn's six-person slate.

Oshkosh chief executive officer Charles L Szews notes: "Mr. Icahn's offer does not compensate all shareholders for the compelling growth we expect to achieve in the market recovery. As demonstrated by our fiscal 2012 fourth quarter results, we are delivering on our plan and gaining momentum."

The offer from Icahn-controlled entities is scheduled to expire on 3 December.

In a related move, the Oshkosh board adopted a shareholder rights plan and declared a dividend of one right on each outstanding share of the company's common stock. Oshkosh says the rights plan is intended to enable all shareholders to realise the long-term value of their investment in the company and to protect them from unfair or coercive takeover tactics.

Oshkosh says it incurred costs during the fourth quarter of about USD200,000 in connection with the proxy contest.

Growth in North American AWP rental market

A survey from construction information supplier KHL Group LLP of Wadhurst, England reports growth of 7% in the North American AWP rental market.

While companies are mostly refleeting, some have slight growth in their numbers and expect the remainder of 2012 to be good for business with further improvement in 2013, according to KHL.
In a major change, United Rentals Inc of Greenwich, Connecticut, acquired RSC Holdings Inc of Scottsdale, Arizona on 30 April 2012 for USD2.69 billion consisting of cash, stock and share-based compensation awards. The KHL ranking lists United with a fleet of 101,829 as a result of combining United's 62,159 AWPs and RSC's 39,670 pieces of aerial equipment.

Among others atop KHL's Aerials20 ranking, the Fort Mill, South Carolina-based Sunbelt Rentals subsidiary of Ashtead Group plc has 34,000 AWPs; Ahern Rentals Inc of Las Vegas, Nevada has 18,894; the equipment rental subsidiary of Park Ridge, New Jersey-based Hertz Global Holdings Inc has 18,650; and the equipment rental operations of Chicago, Illinois-based NES Rentals Holdings Inc has 15,895.

Tim Ford, president of the Terex AWP segment, comments: "If you look at the impact that the top five players had in 2005 as a percent of the top 50 in terms of total fleet, it's about the same today in 2012", meaning the overall fleet has basically remained unchanged over seven years.

"When I look across the market, there are a number of players that are growing, but the overall pie has grown too," Ford says. "The impact that one or two or three customers have in the aggregate really hasn't made a material difference from a buying power standpoint. Certainly there are big players. We want their business. We respect their size and their volume, but nobody has yet built the kind of critical mass where they would be in a Walmart-type position in our industry."