Exhibit 99.1
![]() | Press Release | |
FOR IMMEDIATE RELEASE | ||
Contact: Juna Rowland | ||
Vice President – Corporate & Investor Relations | ||
(240) 313-1816, ir@jlg.com |
STRONG DEMAND FOR ACCESS PRODUCTS CONTINUES
McConnellsburg, PA, February 24, 2005 – JLG Industries, Inc. (NYSE: JLG) announced today consolidated revenues of $353 million for the second quarter ended January 30, 2005, a 49 percent increase from the prior year. The Company reported net income of $7.5 million, or $0.17 per diluted share, compared with net income of $2.2 million, or $0.05 per diluted share in the prior year. Adjusted to eliminate the impact of the OmniQuip integration expenses, earnings per diluted share for the second quarter were $0.19 versus $0.11 in the prior year.
On a GAAP basis, the operating profit margin was 5.0 percent of revenues versus 4.5 percent in the comparable year-ago period. Excluding integration costs, second quarter operating income was $18.7 million or 5.3 percent of revenues, versus $14.8 million or 6.3 percent for the year-ago period, and was significantly improved from the loss of $6.4 million reported in the first quarter of the current fiscal year. Net unrecovered steel costs, before-tax, were an estimated $21.0 million in the second quarter compared to the $26.8 million reported in the first quarter. Net unrecovered steel costs represent increases in steel and related commodity costs against fiscal 2004 baselines offset in part by increased customer pricing. The favorable trend from the first quarter reflects previously announced product price increases effective in January, the third month of JLG’s fiscal second quarter.
“The record revenues in the second quarter, coming on the heels of record sales in the first quarter, further confirm the strong demand for our products,” commented Bill Lasky, Chairman of the Board, President and Chief Executive Officer. “Sales in the U.S. increased by 44 percent, while international sales grew 65 percent year over year, and the order book increased 44 percent sequentially to $290 million.
“Although the price of steel and other commodities remains high, the rate of change has slowed dramatically. The increase in the base prices of our machines and the steel surcharge, which we previously announced, did not recover the increased costs in the first five months of our fiscal year but come closer to neutralizing those increased costs for the remainder of this year. I’m very pleased with the performance of the JLG team in responding to these challenges while meeting the increased demand from our customers.”
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JLG Industries, Inc. – page 2
Year to date Results
For the first half of fiscal 2005, consolidated revenues are $660 million, a 47 percent increase from the prior year period. Including the impact of continued OmniQuip integration costs, results were a loss of $0.03 per share year-to-date versus income of $0.06 last year. Adjusted to eliminate the impact of integration expense, year-to-date earnings were $0.02 per diluted share versus $0.18 for the prior year period. The favorable impact of continuing strong demand, productivity improvements and cost savings were more than offset by higher costs of raw materials, and manufacturing inefficiencies related to component shortages.
The Company also continued to improve key operating metrics, and to reduce trade receivable days sales outstanding to 83.7 from 115.4 in the year-ago quarter, while improving inventory turns to 6.4 from 4.6. Net debt was reduced by $17 million from the comparable period last year.
Outlook
“With half of our fiscal year already behind us, we are reasonably confident that the level of end-user demand that we have seen both in North America and in international regions will continue as customers refresh their fleets and add a measure of expansion,” stated Jim Woodward, Executive Vice President and Chief Financial Officer. “Our supply chain continues to improve and has supported a significant increase in production from last year. Component deliveries continue to improve and we are seeing the benefits of additional capacity investments by many suppliers. Additionally, we continue to successfully focus on cost reduction initiatives, a key element of which is our deployment of the Six Sigma process.
“With continuing strong demand, stabilizing commodity prices and improved supplier deliveries, we have revised our projections for full year revenue growth to 30 to 35 percent over fiscal 2004 versus our previous guidance of 10 to 25 percent. Our customer pricing actions, improved component availability and resulting improved manufacturing efficiencies, along with the impact of cost reduction initiatives, are expected to result in full year earnings per diluted share in the range of $1.10 to $1.20, versus the previously stated $1.00 to $1.15 range. Despite the challenges of significantly increased commodity costs, this range of earnings would represent a substantial improvement over the previous year.”
Dividend
The Board of Directors of JLG today declared its regular, quarterly cash dividend of $.005 per common share. The dividend is payable on March 31, 2005 to shareholders of record March 12, 2005.
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JLG Industries, Inc. – page 3
Conference Call
Management’s complete analysis of the Company’s quarterly results will be provided during a conference call on Friday, February 25th at 9:00 a.m. Eastern Time accessible from www.jlg.com. Within North America, access to the call is available by dialing (800) 901-5241, participant access code 70128335. From international locations, call (617) 786-2963, using the same access code. Please dial into the conference 10 minutes prior to the start. A replay of the call will be available on the website later the same day.
About JLG
JLG Industries, Inc. is the world’s leading producer of access equipment (aerial work platforms and telehandlers) and highway-speed telescopic hydraulic excavators. The Company’s diverse product portfolio encompasses leading brands such as JLGâ aerial work platforms; JLG,â SkyTrakâ, Lullâ and Gradallâ telehandlers; Gradall excavators; and an array of complementary accessories that increase the versatility and efficiency of these products for end users. JLG markets its products and services through a multi-channel approach that includes a highly trained sales force and utilizes a broad range of marketing techniques, integrated supply programs and a network of distributors in the industrial, commercial, institutional and construction markets. In addition, JLG offers world-class after-sales service and support for its customers. JLG’s manufacturing facilities are located in the United States, Belgium, and France, with sales and service operations on six continents.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of future performance, and involve a number of risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, the following: (i) general economic and market conditions, including political and economic uncertainty in areas of the world where we do business; (ii) varying and seasonal levels of demand for our products and services; (iii) limitations on customer access to credit for purchases; (iv) credit risks from our financing of customer purchases; (v) interest and foreign currency exchange rates; and (vi) costs of raw materials and energy, as well as other risks as detailed in the Company’s SEC reports, including the report onForm 10-Q for the period ended October 31, 2004.
Adjustments to reported GAAP earnings, AFS operations as if accounted for under the equity method, as well as our disclosures of free cash flow, EBITDA and net debt are useful in analyzing operating performance, but should be used only in conjunction with financial performance reported in accordance with generally accepted accounting principles. For more information, visitwww.jlg.com.
NOTE: Information contained on our website is not incorporated by reference into this press release.
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JLG Industries, Inc. — Page 4
JLG INDUSTRIES, INC.
FINANCIAL DASHBOARD
(in thousands, except per share data and as otherwise identified)
Quarter Ended | Fiscal Year | Quarter Ended | Fiscal Year | |||||||||||||||||||||||||||||
January 30, | October 31, | Ended | July 31, | April 25, | January 25, | October 26, | Ended | |||||||||||||||||||||||||
2005 | 2004 | July 31, 2004 | 2004 | 2004 | 2004 | 2003 | July 31, 2003 | |||||||||||||||||||||||||
REVENUES AND PROFITABILITY | ||||||||||||||||||||||||||||||||
Revenues | $ | 353,434 | $ | 306,661 | $ | 1,193,962 | $ | 425,160 | $ | 318,687 | $ | 236,530 | $ | 213,585 | $ | 751,128 | ||||||||||||||||
Gross profit margin | 15.3 | % | 8.4 | % | 18.9 | % | 18.8 | % | 20.0 | % | 18.4 | % | 17.9 | % | 17.9 | % | ||||||||||||||||
EBITDA | 27,111 | 2,185 | 105,660 | 38,363 | 30,336 | 19,769 | 17,192 | 62,949 | ||||||||||||||||||||||||
Trailing twelve month EBITDA | 97,995 | 90,653 | 105,660 | 105,660 | 86,678 | 71,220 | 68,885 | 62,949 | ||||||||||||||||||||||||
Trailing twelve month EBITDA margin | 7.0 | % | 7.0 | % | 8.8 | % | 8.8 | % | 8.6 | % | 8.0 | % | 8.6 | % | 8.4 | % | ||||||||||||||||
Operating income (loss) | 17,607 | (8,335 | ) | 75,906 | 31,879 | 23,598 | 10,663 | 9,766 | 36,321 | |||||||||||||||||||||||
Operating profit (loss) margin | 5.0 | % | -2.7 | % | 6.4 | % | 7.5 | % | 7.4 | % | 4.5 | % | 4.6 | % | 4.8 | % | ||||||||||||||||
Net income (loss) margin | 2.1 | % | -2.8 | % | 2.2 | % | 3.6 | % | 2.7 | % | 0.9 | % | 0.2 | % | 1.6 | % | ||||||||||||||||
Reported earnings (loss) per diluted share | $ | .17 | $ | (.20 | ) | $ | .61 | $ | .35 | $ | .20 | $ | .05 | $ | .01 | $ | .29 | |||||||||||||||
IMPACT OF SELECTED ITEMS ON: (2) | ||||||||||||||||||||||||||||||||
income (expense) | ||||||||||||||||||||||||||||||||
PRE-TAX INCOME | ||||||||||||||||||||||||||||||||
Integration expenses — OmniQuip (in both Cost of sales (COS), Selling & administrative and product development (SA&PD)) | $ | (1,093 | ) | $ | (1,896 | ) | $ | (15,975 | ) | $ | (5,022 | ) | $ | (2,907 | ) | $ | (4,145 | ) | $ | (3,901 | ) | $ | — | |||||||||
Restructuring and repositioning charges (in both COS, Restructuring) | — | — | (119 | ) | 3 | (1 | ) | (58 | ) | (63 | ) | (4,040 | ) | |||||||||||||||||||
Currency effects (in Miscellaneous- net) | 3,087 | 2,281 | (2,309 | ) | (1,171 | ) | (1,938 | ) | 675 | 125 | 5,422 | |||||||||||||||||||||
Bad debt charges (in SA&PD) | (1,948 | ) | (1,132 | ) | (11,560 | ) | (3,819 | ) | (2,376 | ) | (4,273 | ) | (1,092 | ) | (7,024 | ) | ||||||||||||||||
Inventory charges (in COS) | — | (1,592 | ) | (4,519 | ) | (1,374 | ) | (196 | ) | (1,622 | ) | (1,327 | ) | (4,463 | ) | |||||||||||||||||
Early vesting incentives (in both COS, SA&PD) | (436 | ) | (995 | ) | (1,771 | ) | — | (577 | ) | (1,194 | ) | — | — | |||||||||||||||||||
Other Incentive pay (in both COS, SA&PD) | — | — | (16,923 | ) | (12,065 | ) | (4,858 | ) | — | — | (2,605 | ) | ||||||||||||||||||||
Restatement expenses (in SA&PD) | — | — | (1,264 | ) | (206 | ) | (1,058 | ) | — | — | — | |||||||||||||||||||||
Estimated net unrecovered steel cost (in COS) (2) | (20,980 | ) | (26,764 | ) | (4,695 | ) | (4,695 | ) | — | — | — | — | ||||||||||||||||||||
NET INCOME | ||||||||||||||||||||||||||||||||
Integration expenses — OmniQuip (in both COS, SA&PD) | (710 | ) | (1,232 | ) | (10,247 | ) | (3,264 | ) | (1,890 | ) | (2,589 | ) | (2,504 | ) | — | |||||||||||||||||
Restructuring and repositioning charges (in both COS, Restructuring) | — | — | (75 | ) | 2 | (1 | ) | (36 | ) | (40 | ) | (2,747 | ) | |||||||||||||||||||
Currency effects (in Miscellaneous-net) | 2,007 | 1,483 | (1,519 | ) | (761 | ) | (1,260 | ) | 422 | 80 | 3,687 | |||||||||||||||||||||
Bad debt charges (in SA&PD) | (1,266 | ) | (736 | ) | (7,396 | ) | (2,482 | ) | (1,544 | ) | (2,669 | ) | (701 | ) | (4,776 | ) | ||||||||||||||||
Inventory charges (in COS) | (200 | ) | (1,035 | ) | (2,885 | ) | (893 | ) | (127 | ) | (1,013 | ) | (852 | ) | (3,035 | ) | ||||||||||||||||
Benefit from change in effective income tax rate | — | — | — | — | — | — | — | 2,051 | ||||||||||||||||||||||||
Early vesting incentives (in both COS, SA&PD) | (283 | ) | (647 | ) | (1,121 | ) | — | (375 | ) | (746 | ) | — | — | |||||||||||||||||||
Other Incentive pay (in both COS, SA&PD) | — | — | (11,000 | ) | (7,842 | ) | (3,158 | ) | — | — | (1,771 | ) | ||||||||||||||||||||
Restatement expenses (in SA&PD) | — | — | (822 | ) | (134 | ) | (688 | ) | — | — | — | |||||||||||||||||||||
Estimated net unrecovered steel cost (in COS) (2) | (13,637 | ) | (17,397 | ) | (3,052 | ) | (3,052 | ) | — | — | — | — | ||||||||||||||||||||
EARNINGS PER SHARE | ||||||||||||||||||||||||||||||||
Integration expenses — OmniQuip (in both COS, SA&PD) | (0.02 | ) | (0.03 | ) | (0.23 | ) | (0.07 | ) | (0.04 | ) | (0.06 | ) | (0.06 | ) | — | |||||||||||||||||
Restructuring and repositioning charges (in both COS, Restructuring) | — | — | — | — | — | — | — | (0.06 | ) | |||||||||||||||||||||||
Currency effects (in Miscellaneous-net) | 0.04 | 0.03 | (0.04 | ) | (0.02 | ) | (0.03 | ) | 0.01 | — | 0.09 | |||||||||||||||||||||
Bad debt charges (in SA&PD) | (0.03 | ) | (0.02 | ) | (0.17 | ) | (0.06 | ) | (0.04 | ) | (0.06 | ) | (0.02 | ) | (0.11 | ) | ||||||||||||||||
Inventory charges (in COS) | — | (0.02 | ) | (0.06 | ) | (0.02 | ) | — | (0.02 | ) | (0.02 | ) | (0.07 | ) | ||||||||||||||||||
Benefit from change in effective income tax rate | — | — | — | — | — | — | — | 0.05 | ||||||||||||||||||||||||
Early vesting incentives (in both COS, SA&PD) | (0.01 | ) | (0.01 | ) | (0.03 | ) | — | (0.01 | ) | (0.02 | ) | — | — | |||||||||||||||||||
Other Incentive pay (in both COS, SA&PD) | — | — | (0.25 | ) | (0.18 | ) | (0.07 | ) | — | — | (0.04 | ) | ||||||||||||||||||||
Restatement expenses (in SA&PD) | — | — | (0.02 | ) | — | (0.02 | ) | — | — | — | ||||||||||||||||||||||
Estimated net unrecovered steel cost (in COS) (2) | (0.30 | ) | (0.40 | ) | (0.07 | ) | (0.07 | ) | — | — | — | — | ||||||||||||||||||||
BALANCE SHEET & LIQUIDITY MEASURES | ||||||||||||||||||||||||||||||||
Cash & cash equivalents | $ | 24,305 | $ | 66,498 | $ | 37,656 | $ | 37,656 | $ | 12,945 | $ | 18,125 | $ | 11,288 | $ | 132,809 | ||||||||||||||||
Trade accounts and finance receivables, net | 354,350 | 333,316 | 400,597 | 400,597 | 413,000 | 365,745 | 331,682 | 302,021 | ||||||||||||||||||||||||
Inventories | 182,606 | 170,731 | 154,405 | 154,405 | 164,160 | 150,074 | 153,200 | 122,675 | ||||||||||||||||||||||||
Total balance sheet debt | 383,534 | 389,609 | 423,534 | 423,534 | 465,094 | 464,609 | 467,422 | 460,570 | ||||||||||||||||||||||||
Limited recourse debt from finance receivables monetizations | 77,601 | 85,733 | 121,794 | 121,794 | 135,453 | 150,283 | 153,541 | 164,940 | ||||||||||||||||||||||||
Net debt (3) | 286,092 | 242,381 | 269,553 | 269,553 | 323,186 | 303,408 | 310,498 | 171,103 | ||||||||||||||||||||||||
Net debt (3) to total capitalization | 50 | % | 47 | % | 49 | % | 49 | % | 55 | % | 55 | % | 56 | % | 41 | % | ||||||||||||||||
Maximum loss exposure from finance receivables monetizations | 27,203 | 26,068 | 25,161 | 25,161 | 23,757 | 24,460 | 23,380 | 21,708 | ||||||||||||||||||||||||
Equity | 284,746 | 276,780 | 281,270 | 281,270 | 264,018 | 252,252 | 248,911 | 247,714 | ||||||||||||||||||||||||
Working capital | 340,786 | 328,671 | 340,552 | 340,552 | 353,696 | 336,107 | 321,950 | 382,763 | ||||||||||||||||||||||||
Depreciation and amortization | 6,958 | 7,088 | 25,681 | 5,070 | 7,359 | 6,766 | 6,486 | 19,937 | ||||||||||||||||||||||||
Capital expenditures, net of retirements | 2,010 | 2,653 | 11,978 | 3,597 | 2,094 | 2,858 | 3,429 | 10,324 | ||||||||||||||||||||||||
Free cash flow (4) | (43,711 | ) | 27,172 | (98,450 | ) | 53,633 | (19,778 | ) | 7,090 | (139,395 | ) | 27,781 | ||||||||||||||||||||
FINANCIAL RATIOS | ||||||||||||||||||||||||||||||||
Days sales outstanding | 83.7 | 92.0 | 78.4 | 78.4 | 106.0 | 115.4 | 106.0 | 102.7 | ||||||||||||||||||||||||
Days payables outstanding | 46.5 | 54.6 | 57.0 | 57.0 | 65.1 | 58.6 | 54.0 | 70.8 | ||||||||||||||||||||||||
Inventory turnover (annualized) | 6.4 | 5.9 | 5.8 | 5.8 | 5.1 | 4.6 | 3.8 | 3.4 |
(1) | Net of 35%, 35%, 35%, 35%, 38%, 36% and 32% effective income tax rate for the second quarter of fiscal 2005, first quarter of fiscal 2005, the fourth quarter of fiscal 2004, the third quarter of fiscal 2004, the second quarter of fiscal 2004, the first quarter of fiscal 2004 and fiscal 2003, respectively. EPS is calculated by dividing the Net Income (Loss) amounts by the respective diluted shares for each period. Individual quarterly net income (loss) per diluted share may not equal the fiscal year EPS due to changes in the number of common shares outstanding during the year. Repositioning charges are reported in COS. | |
(2) | Net unrecovered steel cost is an estimate based upon a baseline average of steel prices per ton for various types of steel at the beginning of fiscal 2004 compared to the impact of steel prices incurred for various types of steel. These estimates include assumptions regarding the steel content of and sources of our products and their components. The steel price increases are netted against steel surcharges and base price increases invoiced to our customers. | |
(3) | Net debt reflects total balance sheet debt plus off-balance sheet financing, less cash and limited recourse debt from finance receivables monetizations. | |
(4) | Free cash flow is defined as cash flow from operating activities, investing activities, payment of dividends, exercise of stock options and issuance of restricted awards, and the effect of exchange rate changes on cash less changes in accounts receivable securitization, limited recourse debt from finance receivables monetizations and off-balance sheet debt. |
JLG Industries, Inc. — Page 5
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(in thousands, except per share data)
(Quarterly data is unaudited)
Quarter Ended | Fiscal Year | Quarter Ended | Fiscal Year | |||||||||||||||||||||||||||||
January 30, | October 31, | Ended | July 31, | April 25, | January 25, | October 26, | Ended | |||||||||||||||||||||||||
2005 | 2004 | July 31, 2004 | 2004 | 2004 | 2004 | 2003 | July 31, 2003 | |||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||||||||||
Net sales | $ | 347,947 | $ | 302,131 | $ | 1,170,186 | $ | 418,605 | $ | 312,650 | $ | 230,539 | $ | 208,392 | $ | 724,819 | ||||||||||||||||
Financial products | 3,056 | 2,660 | 15,203 | 4,172 | 3,913 | 3,442 | 3,676 | 19,184 | ||||||||||||||||||||||||
Rentals | 2,431 | 1,870 | 8,573 | 2,383 | 2,124 | 2,549 | 1,517 | 7,125 | ||||||||||||||||||||||||
353,434 | 306,661 | 1,193,962 | 425,160 | 318,687 | 236,530 | 213,585 | 751,128 | |||||||||||||||||||||||||
Cost of sales | 299,462 | 280,966 | 968,562 | 345,110 | 255,050 | 193,083 | 175,319 | 616,686 | ||||||||||||||||||||||||
Gross profit | 53,972 | 25,695 | 225,400 | 80,050 | 63,637 | 43,447 | 38,266 | 134,442 | ||||||||||||||||||||||||
Gross profit margin | 15.3 | % | 8.4 | % | 18.9 | % | 18.8 | % | 20.0 | % | 18.4 | % | 17.9 | % | 17.9 | % | ||||||||||||||||
Selling and administrative expenses | 30,810 | 28,122 | 128,465 | 42,348 | 34,052 | 28,349 | 23,716 | 79,225 | ||||||||||||||||||||||||
Selling & administrative % | 8.7 | % | 9.2 | % | 10.8 | % | 10.0 | % | 10.7 | % | 12.0 | % | 11.1 | % | 10.5 | % | ||||||||||||||||
Product development expenses | 5,555 | 5,908 | 21,002 | 5,807 | 5,987 | 4,435 | 4,773 | 16,142 | ||||||||||||||||||||||||
Product development % | 1.6 | % | 1.9 | % | 1.8 | % | 1.6 | % | 1.9 | % | 1.9 | % | 2.2 | % | 2.1 | % | ||||||||||||||||
Restructuring charges | — | — | 27 | 16 | — | — | 11 | 2,754 | ||||||||||||||||||||||||
Income (loss) from operations | 17,607 | (8,335 | ) | 75,906 | 31,879 | 23,598 | 10,663 | 9,766 | 36,321 | |||||||||||||||||||||||
Operating profit (loss) margin | 5.0 | % | -2.7 | % | 6.4 | % | 7.5 | % | 7.4 | % | 4.5 | % | 4.6 | % | 4.8 | % | ||||||||||||||||
Other income (deductions): | ||||||||||||||||||||||||||||||||
Interest expense | (8,322 | ) | (8,996 | ) | (38,098 | ) | (9,274 | ) | (9,400 | ) | (9,548 | ) | (9,876 | ) | (27,985 | ) | ||||||||||||||||
Miscellaneous, net | 2,546 | 3,432 | 4,073 | 1,414 | (621 | ) | 2,340 | 940 | 6,691 | |||||||||||||||||||||||
Income (loss) before taxes | 11,831 | (13,899 | ) | 41,881 | 24,019 | 13,577 | 3,455 | 830 | 15,027 | |||||||||||||||||||||||
Income tax provision (benefit) | 4,347 | (5,170 | ) | 15,232 | 8,748 | 4,890 | 1,297 | 297 | 2,635 | |||||||||||||||||||||||
Net income (loss) | $ | 7,484 | $ | (8,729 | ) | $ | 26,649 | $ | 15,271 | $ | 8,687 | $ | 2,158 | $ | 533 | $ | 12,392 | |||||||||||||||
Return on revenues | 2.1 | % | -2.8 | % | 2.2 | % | 3.6 | % | 2.7 | % | 0.9 | % | 0.2 | % | 1.6 | % | ||||||||||||||||
Earnings (loss) per common share | $ | .17 | $ | (.20 | ) | $ | .62 | $ | .36 | $ | .20 | $ | .05 | $ | .01 | $ | .29 | |||||||||||||||
Earnings (loss) per common share — assuming dilution | $ | .17 | $ | (.20 | ) | $ | .61 | $ | .35 | $ | .20 | $ | .05 | $ | .01 | $ | .29 | |||||||||||||||
Cash Dividends per share | $ | .005 | $ | .005 | $ | .020 | $ | .005 | $ | .005 | $ | .005 | $ | .005 | $ | .020 | ||||||||||||||||
Average basic shares outstanding | 43,798 | 43,277 | 42,860 | 42,955 | 42,836 | 42,791 | 42,656 | 42,601 | ||||||||||||||||||||||||
Average diluted shares outstanding | 44,988 | 43,277 | 44,032 | 44,191 | 44,013 | 44,152 | 43,575 | 42,866 | ||||||||||||||||||||||||
JLG Industries, Inc. — Page 6
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands, except per share data)
(Quarterly data is unaudited)
January 30, | October 31, | July 31, | April 25, | January 25, | October 26, | July 31, | ||||||||||||||||||||||
2005 | 2004 | 2004 | 2004 | 2004 | 2003 | 2003 | ||||||||||||||||||||||
ASSETS | ||||||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 24,305 | $ | 66,498 | $ | 37,656 | $ | 12,945 | $ | 18,125 | $ | 11,288 | $ | 132,809 | ||||||||||||||
Trade accounts and finance receivables, net | 354,350 | 333,316 | 400,597 | 413,000 | 365,745 | 331,682 | 302,021 | |||||||||||||||||||||
Inventories | 182,606 | 170,731 | 154,405 | 164,160 | 150,074 | 153,200 | 122,675 | |||||||||||||||||||||
Other current assets | 47,466 | 45,739 | 41,058 | 42,086 | 27,441 | 54,252 | 46,474 | |||||||||||||||||||||
Total current assets | 608,727 | 616,284 | 633,716 | 632,191 | 561,385 | 550,422 | 603,979 | |||||||||||||||||||||
Property, plant and equipment, net | 82,387 | 89,443 | 91,504 | 88,277 | 90,862 | 92,525 | 79,699 | |||||||||||||||||||||
Equipment held for rental, net | 23,163 | 26,842 | 21,190 | 18,687 | 22,903 | 18,236 | 19,651 | |||||||||||||||||||||
Finance receivables, less current portion | 36,992 | 39,002 | 33,747 | 28,797 | 22,882 | 30,484 | 31,156 | |||||||||||||||||||||
Pledged finance receivables, less current portion | 50,372 | 56,413 | 86,559 | 95,851 | 105,915 | 114,382 | 119,073 | |||||||||||||||||||||
Goodwill | 63,165 | 63,017 | 62,885 | 66,501 | 66,501 | 66,450 | 29,509 | |||||||||||||||||||||
Intangible assets, net | 33,848 | 34,590 | 35,240 | 32,979 | 33,709 | 34,448 | — | |||||||||||||||||||||
Other assets | 80,420 | 66,991 | 62,603 | 66,434 | 67,961 | 66,002 | 53,135 | |||||||||||||||||||||
$ | 979,074 | $ | 992,582 | $ | 1,027,444 | $ | 1,029,717 | $ | 972,118 | $ | 972,949 | $ | 936,202 | |||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||||||
Short-term debt and current portion of long-term debt | $ | 3,744 | $ | 1,788 | $ | 1,729 | $ | 14,843 | $ | 1,758 | $ | 2,278 | $ | 1,472 | ||||||||||||||
Current portion of limited recourse debt from finance receivables monetizations | 26,660 | 26,725 | 32,585 | 37,086 | 40,824 | 40,153 | 45,279 | |||||||||||||||||||||
Accounts payable | 139,742 | 150,600 | 139,990 | 123,984 | 92,762 | 68,197 | 83,408 | |||||||||||||||||||||
Accrued expenses | 97,795 | 108,500 | 118,860 | 102,582 | 89,934 | 117,844 | 91,057 | |||||||||||||||||||||
Total current liabilities | 267,941 | 287,613 | 293,164 | 278,495 | 225,278 | 228,472 | 221,216 | |||||||||||||||||||||
Long-term debt, less current portion | 302,189 | 302,088 | 300,011 | 314,798 | 312,568 | 311,603 | 294,158 | |||||||||||||||||||||
Limited recourse debt from finance receivables monetizations, less current portion | 50,941 | 59,008 | 89,209 | 98,367 | 109,459 | 113,388 | 119,661 | |||||||||||||||||||||
Accrued post-retirement benefits | 30,423 | 30,211 | 29,666 | 28,798 | 27,998 | 27,199 | 26,179 | |||||||||||||||||||||
Other long-term liabilities | 23,536 | 21,362 | 20,542 | 30,501 | 30,487 | 29,790 | 15,160 | |||||||||||||||||||||
Provisions for contingencies | 19,298 | 15,520 | 13,582 | 14,740 | 14,076 | 13,586 | 12,114 | |||||||||||||||||||||
Shareholders’ equity | ||||||||||||||||||||||||||||
Capital stock: | ||||||||||||||||||||||||||||
Authorized shares: 100,000 at $.20 par value Issued shares: 44,700; fiscal 2004 — 43,903; fiscal 2003 — 43,367 | 8,940 | 8,907 | 8,781 | 8,732 | 8,712 | 8,683 | 8,673 | |||||||||||||||||||||
Additional paid-in capital | 37,087 | 35,111 | 29,571 | 25,883 | 24,725 | 23,789 | 23,597 | |||||||||||||||||||||
Retained earnings | 252,579 | 245,319 | 254,268 | 239,215 | 230,746 | 228,806 | 228,490 | |||||||||||||||||||||
Unearned compensation | (3,433 | ) | (4,019 | ) | (5,333 | ) | (2,856 | ) | (3,796 | ) | (5,145 | ) | (5,428 | ) | ||||||||||||||
Accumulated other comprehensive loss | (10,427 | ) | (8,538 | ) | (6,017 | ) | (6,956 | ) | (8,135 | ) | (7,222 | ) | (7,618 | ) | ||||||||||||||
Total shareholders’ equity | 284,746 | 276,780 | 281,270 | 264,018 | 252,252 | 248,911 | 247,714 | |||||||||||||||||||||
$ | 979,074 | $ | 992,582 | $ | 1,027,444 | $ | 1,029,717 | $ | 972,118 | $ | 972,949 | $ | 936,202 | |||||||||||||||
JLG Industries, Inc. — Page 7
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW
(in thousands)
(Quarterly data is unaudited)
Quarter Ended | Fiscal Year | Quarter Ended | Fiscal Year | |||||||||||||||||||||||||||||
January 30, | October 31, | Ended | July 31, | April 25, | January 25, | October 26, | Ended | |||||||||||||||||||||||||
2005 | 2004 | July 31, 2004 | 2004 | 2004 | 2004 | 2003 | July 31, 2003 | |||||||||||||||||||||||||
OPERATIONS | ||||||||||||||||||||||||||||||||
Net income (loss) | $ | 7,484 | $ | (8,729 | ) | $ | 26,649 | $ | 15,271 | $ | 8,687 | $ | 2,158 | $ | 533 | $ | 12,392 | |||||||||||||||
Adjustments to reconcile net income (loss) to cash flow from operating activities: | ||||||||||||||||||||||||||||||||
(Gain) loss on sale of property, plant and equipment | (19 | ) | 161 | 319 | 52 | 214 | (240 | ) | 293 | 266 | ||||||||||||||||||||||
(Gain) loss on sale of equipment held for rental | (5,334 | ) | (1,300 | ) | (12,451 | ) | (12,568 | ) | (1,247 | ) | 44 | 1,320 | (6,794 | ) | ||||||||||||||||||
Non-cash charges and credits: | ||||||||||||||||||||||||||||||||
Depreciation and amortization | 6,958 | 7,088 | 25,681 | 5,070 | 7,359 | 6,766 | 6,486 | 19,937 | ||||||||||||||||||||||||
Other | 3,965 | 2,749 | 17,006 | (1,173 | ) | 5,977 | 8,548 | 3,654 | 7,869 | |||||||||||||||||||||||
Changes in selected working capital items: | ||||||||||||||||||||||||||||||||
Accounts receivable | (29,659 | ) | 62,217 | (66,296 | ) | 18,059 | (57,552 | ) | (27,823 | ) | 1,020 | (35,324 | ) | |||||||||||||||||||
Inventories | (11,758 | ) | (16,368 | ) | 9,188 | 13,060 | (14,053 | ) | 3,296 | 6,885 | 43,137 | |||||||||||||||||||||
Accounts payable | (10,833 | ) | 10,554 | 33,207 | 11,982 | 31,428 | 24,751 | (34,954 | ) | (46,026 | ) | |||||||||||||||||||||
Other operating assets and liabilities | (2,340 | ) | (12,560 | ) | 13,506 | 21,266 | (3,515 | ) | (4,289 | ) | 44 | (12,706 | ) | |||||||||||||||||||
Changes in finance receivables | 6,970 | (8,496 | ) | (6,112 | ) | (6,756 | ) | (2,181 | ) | 1,770 | 1,055 | 40,487 | ||||||||||||||||||||
Changes in pledged finance receivables | (917 | ) | 1,391 | (14,866 | ) | 224 | 1,537 | (1,175 | ) | (15,452 | ) | (114,271 | ) | |||||||||||||||||||
Changes in other assets and liabilities | (12,920 | ) | (1,147 | ) | (11,090 | ) | (4,408 | ) | (1,921 | ) | (862 | ) | (3,899 | ) | (3,295 | ) | ||||||||||||||||
Cash flow from operating activities | (48,403 | ) | 35,560 | 14,741 | 60,079 | (25,267 | ) | 12,944 | (33,015 | ) | (94,328 | ) | ||||||||||||||||||||
INVESTMENTS | ||||||||||||||||||||||||||||||||
Purchases of property, plant and equipment | (2,072 | ) | (2,895 | ) | (12,387 | ) | (3,522 | ) | (2,435 | ) | (2,619 | ) | (3,811 | ) | (10,806 | ) | ||||||||||||||||
Proceeds from sale of property, plant and equipment | 81 | 81 | 90 | (127 | ) | 127 | 1 | 89 | 216 | |||||||||||||||||||||||
Purchases of equipment held for rental | (8,851 | ) | (10,089 | ) | (26,689 | ) | (10,246 | ) | (4,491 | ) | (9,743 | ) | (2,209 | ) | (16,342 | ) | ||||||||||||||||
Proceeds from sale of equipment held for rental | 16,037 | 4,150 | 33,269 | 20,563 | 8,008 | 3,557 | 1,141 | 19,063 | ||||||||||||||||||||||||
Cash portion of acquisitions | (105 | ) | — | (109,557 | ) | (14,186 | ) | — | — | (95,371 | ) | — | ||||||||||||||||||||
Other | (56 | ) | (46 | ) | 333 | (27 | ) | 507 | (101 | ) | (46 | ) | (689 | ) | ||||||||||||||||||
Cash flow from investing activities | 5,034 | (8,799 | ) | (114,941 | ) | (7,545 | ) | 1,716 | (8,905 | ) | (100,207 | ) | (8,558 | ) | ||||||||||||||||||
FINANCING | ||||||||||||||||||||||||||||||||
Net issuance (repayment) of short-term debt | 1,955 | 58 | 27 | (13,115 | ) | 13,084 | (536 | ) | 594 | (13,497 | ) | |||||||||||||||||||||
Issuance of long-term debt | 45,038 | 85,016 | 351,999 | 181,999 | 71,000 | 77,000 | 22,000 | 404,283 | ||||||||||||||||||||||||
Repayment of long-term debt | (45,140 | ) | (85,092 | ) | (362,506 | ) | (196,202 | ) | (67,099 | ) | (77,119 | ) | (22,086 | ) | (279,647 | ) | ||||||||||||||||
Issuance of limited recourse debt | — | — | 13,979 | — | — | 3,108 | 10,871 | 117,383 | ||||||||||||||||||||||||
Repayment of limited recourse debt | — | — | (253 | ) | — | — | — | (253 | ) | (118 | ) | |||||||||||||||||||||
Payment of dividends | (224 | ) | (220 | ) | (871 | ) | (219 | ) | (218 | ) | (218 | ) | (216 | ) | (859 | ) | ||||||||||||||||
Exercise of stock options | 1,276 | 5,086 | 2,414 | 276 | 1,242 | 746 | 150 | 93 | ||||||||||||||||||||||||
Cash flow from financing activities | 2,905 | 4,848 | 4,789 | (27,261 | ) | 18,009 | 2,981 | 11,060 | 227,638 | |||||||||||||||||||||||
CURRENCY ADJUSTMENTS | ||||||||||||||||||||||||||||||||
Effect of exchange rate changes on cash | (1,729 | ) | (2,767 | ) | 258 | (562 | ) | 362 | (183 | ) | 641 | 1,852 | ||||||||||||||||||||
CASH AND CASH EQUIVALENTS | ||||||||||||||||||||||||||||||||
Net change in cash and cash equivalents | (42,193 | ) | 28,842 | (95,153 | ) | 24,711 | (5,180 | ) | 6,837 | (121,521 | ) | 126,604 | ||||||||||||||||||||
Beginning balance | 66,498 | 37,656 | 132,809 | 12,945 | 18,125 | 11,288 | 132,809 | 6,205 | ||||||||||||||||||||||||
Ending balance | $ | 24,305 | $ | 66,498 | $ | 37,656 | $ | 37,656 | $ | 12,945 | $ | 18,125 | $ | 11,288 | $ | 132,809 | ||||||||||||||||
JLG Industries, Inc. — Page 8
JLG INDUSTRIES, INC.
CONSOLIDATED SELECTED SUPPLEMENTAL FINANCIAL INFORMATION
(in thousands)
(Quarterly data is unaudited)
Quarter Ended | Fiscal Year | Quarter Ended | Fiscal Year | |||||||||||||||||||||||||||||
January 30, | October 31, | Ended | July 31, | April 25, | January 25, | October 26, | Ended | |||||||||||||||||||||||||
2005 | 2004 | July 31, 2004 | 2004 | 2004 | 2004 | 2003 | July 31, 2003 | |||||||||||||||||||||||||
SEGMENT INFORMATION | ||||||||||||||||||||||||||||||||
REVENUES: | ||||||||||||||||||||||||||||||||
Machinery | $ | 281,220 | $ | 252,532 | $ | 973,610 | $ | 351,123 | $ | 261,263 | $ | 192,266 | $ | 168,958 | $ | 594,484 | ||||||||||||||||
Equipment Services | 69,070 | 51,350 | 204,454 | 69,559 | 53,258 | 40,822 | 40,815 | 136,737 | ||||||||||||||||||||||||
Access Financial Solutions | 3,144 | 2,779 | 15,898 | 4,478 | 4,166 | 3,442 | 3,812 | 19,907 | ||||||||||||||||||||||||
$ | 353,434 | $ | 306,661 | $ | 1,193,962 | $ | 425,160 | $ | 318,687 | $ | 236,530 | $ | 213,585 | $ | 751,128 | |||||||||||||||||
SEGMENT PROFIT (LOSS): | ||||||||||||||||||||||||||||||||
Machinery | $ | 9,533 | $ | (13,340 | ) | $ | 70,844 | $ | 27,520 | $ | 25,190 | $ | 11,541 | $ | 6,593 | $ | 25,513 | |||||||||||||||
Equipment services | 19,711 | 15,767 | 59,760 | 20,725 | 15,158 | 12,809 | 11,068 | 27,119 | ||||||||||||||||||||||||
Access Financial Solutions | 712 | 194 | 1,695 | 990 | 694 | (273 | ) | 284 | 3,990 | |||||||||||||||||||||||
General corporate expenses | (13,801 | ) | (13,249 | ) | (67,308 | ) | (19,898 | ) | (20,229 | ) | (16,088 | ) | (11,093 | ) | (32,001 | ) | ||||||||||||||||
Segment profit (loss) | 16,155 | (10,628 | ) | 64,991 | 29,337 | 20,813 | 7,989 | 6,852 | 24,621 | |||||||||||||||||||||||
Add: AFS’ interest expense | 1,452 | 2,293 | 10,915 | 2,542 | 2,785 | 2,674 | 2,914 | 11,700 | ||||||||||||||||||||||||
Operating Income (Loss) | $ | 17,607 | $ | (8,335 | ) | $ | 75,906 | $ | 31,879 | $ | 23,598 | $ | 10,663 | $ | 9,766 | $ | 36,321 | |||||||||||||||
PRODUCT GROUP REVENUES | ||||||||||||||||||||||||||||||||
Aerial work platforms | $ | 171,517 | $ | 124,523 | $ | 562,056 | $ | 217,425 | $ | 146,017 | $ | 109,354 | $ | 89,260 | $ | 428,564 | ||||||||||||||||
Telehandlers | 92,490 | 119,668 | 358,865 | 117,510 | 99,439 | 69,908 | 72,008 | 117,475 | ||||||||||||||||||||||||
Excavators | 17,213 | 8,341 | 52,689 | 16,188 | 15,807 | 13,004 | 7,690 | 48,445 | ||||||||||||||||||||||||
After-sales service and support, including parts sales, and used and reconditioned equipment sales | 66,727 | 49,599 | 196,576 | 67,482 | 51,387 | 38,273 | 39,434 | 130,335 | ||||||||||||||||||||||||
Financial products | 3,056 | 2,660 | 15,203 | 4,172 | 3,913 | 3,442 | 3,676 | 19,184 | ||||||||||||||||||||||||
Rentals | 2,431 | 1,870 | 8,573 | 2,383 | 2,124 | 2,549 | 1,517 | 7,125 | ||||||||||||||||||||||||
$ | 353,434 | $ | 306,661 | $ | 1,193,962 | $ | 425,160 | $ | 318,687 | $ | 236,530 | $ | 213,585 | $ | 751,128 | |||||||||||||||||
GEOGRAPHIC REVENUES | ||||||||||||||||||||||||||||||||
United States | $ | 256,027 | $ | 238,733 | $ | 923,696 | $ | 327,498 | $ | 246,985 | $ | 177,542 | $ | 171,671 | $ | 546,494 | ||||||||||||||||
Europe | 56,819 | 36,863 | 178,392 | 66,076 | 48,079 | 40,286 | 23,951 | 145,038 | ||||||||||||||||||||||||
Other international | 40,588 | 31,065 | 91,874 | 31,586 | 23,623 | 18,702 | 17,963 | 59,596 | ||||||||||||||||||||||||
$ | 353,434 | $ | 306,661 | $ | 1,193,962 | $ | 425,160 | $ | 318,687 | $ | 236,530 | $ | 213,585 | $ | 751,128 | |||||||||||||||||
JLG Industries, Inc. — Page 9
JLG INDUSTRIES, INC.
EBITDA
QUARTERLY PERIODS
(in thousands)
January 30, | October 31, | July 31, | April 25, | January 25, | October 26, | July 31, | ||||||||||||||||||||||
2005 | 2004 | 2004 | 2004 | 2004 | 2003 | 2003 | ||||||||||||||||||||||
Net income (loss) | $ | 7,484 | ($8,729 | ) | $ | 15,271 | $ | 8,687 | $ | 2,158 | $ | 533 | $ | 5,672 | ||||||||||||||
Interest expense | 8,322 | 8,996 | 9,274 | 9,400 | 9,548 | 9,876 | 9,645 | |||||||||||||||||||||
Income tax provision (benefit) | 4,347 | (5,170 | ) | 8,748 | 4,890 | 1,297 | 297 | (527 | ) | |||||||||||||||||||
Depreciation and amortization | 6,958 | 7,088 | 5,070 | 7,359 | 6,766 | 6,486 | 4,591 | |||||||||||||||||||||
EBITDA | $ | 27,111 | $ | 2,185 | $ | 38,363 | $ | 30,336 | $ | 19,769 | $ | 17,192 | $ | 19,381 | ||||||||||||||
We monitor our EBITDA, which is a supplemental measure to GAAP that provides additional information concerning our leverage position and our historical ability to meet debt service and capital expenditure and working capital requirements. EBITDA also is an indicator of profitability, particularly in our capital-intensive industry. EBITDA reflects our earnings (loss) before interest, taxes and depreciation and amortization. EBITDA as presented differs from measures of EBITDA calculated for purposes of financial covenants in our note indentures and senior credit facilities.
JLG Industries, Inc. — Page 10
JLG INDUSTRIES, INC.
EBITDA AND EBITDA MARGINS
TRAILING TWELVE MONTH PERIODS
(in thousands)
January 30, | October 31, | July 31, | April 25, | January 25, | October 26, | July 31, | ||||||||||||||||||||||
2005 | 2004 | 2004 | 2004 | 2004 | 2003 | 2003 | ||||||||||||||||||||||
Net income | $ | 22,713 | $ | 17,387 | $ | 26,649 | $ | 17,050 | $ | 10,528 | $ | 12,596 | $ | 12,392 | ||||||||||||||
Interest expense | 35,992 | 37,218 | 38,098 | 38,469 | 35,833 | 32,357 | 27,985 | |||||||||||||||||||||
Income tax provision | 12,815 | 9,765 | 15,232 | 5,957 | 2,085 | 2,777 | 2,635 | |||||||||||||||||||||
Depreciation and amortization | 26,475 | 26,283 | 25,681 | 25,202 | 22,774 | 21,155 | 19,937 | |||||||||||||||||||||
EBITDA | $ | 97,995 | $ | 90,653 | $ | 105,660 | $ | 86,678 | $ | 71,220 | $ | 68,885 | $ | 62,949 | ||||||||||||||
Revenues | $ | 1,403,942 | $ | 1,287,038 | $ | 1,193,962 | $ | 1,002,360 | $ | 889,443 | $ | 804,226 | $ | 751,128 | ||||||||||||||
EBITDA Margin | 7.0 | % | 7.0 | % | 8.8 | % | 8.6 | % | 8.0 | % | 8.6 | % | 8.4 | % | ||||||||||||||
We monitor our EBITDA, which is a supplemental measure to GAAP that provides additional information concerning our leverage position and our historical ability to meet debt service and capital expenditure and working capital requirements. EBITDA also is an indicator of profitability, particularly in our capital-intensive industry. EBITDA reflects our earnings (loss) before interest, taxes and depreciation and amortization. EBITDA as presented differs from measures of EBITDA calculated for purposes of financial covenants in our note indentures and senior credit facilities.
JLG Industries, Inc. — Page 11
JLG INDUSTRIES, INC.
NET DEBT
(in thousands)
January 30, | October 31, | July 31, | April 25, | January 25, | October 26, | July 31, | ||||||||||||||||||||||
2005 | 2004 | 2004 | 2004 | 2004 | 2003 | 2003 | ||||||||||||||||||||||
Revolving credit facilities | $ | — | $ | — | $ | — | $ | 14,000 | $ | — | $ | — | $ | — | ||||||||||||||
$15 million cash management facility | 1,944 | — | — | 13,129 | — | 567 | — | |||||||||||||||||||||
$125 million senior notes | 125,000 | 125,000 | 125,000 | 125,000 | 125,000 | 125,000 | 125,000 | |||||||||||||||||||||
$175 million senior subordinated notes | 175,000 | 175,000 | 175,000 | 175,000 | 175,000 | 175,000 | 175,000 | |||||||||||||||||||||
Miscellaneous debt | 5,128 | 5,219 | 5,236 | 5,321 | 15,465 | 15,554 | 1,983 | |||||||||||||||||||||
Fair value of interest rate swaps | (6,120 | ) | (6,492 | ) | (8,814 | ) | (8,296 | ) | (6,795 | ) | (8,065 | ) | (12,347 | ) | ||||||||||||||
Gain on terminated interest rate swap | 4,981 | 5,149 | 5,318 | 5,487 | 5,656 | 5,825 | 5,994 | |||||||||||||||||||||
Bank debt and notes | 305,933 | 303,876 | 301,740 | 329,641 | 314,326 | 313,881 | 295,630 | |||||||||||||||||||||
Limited recourse debt from finance receivables monetizations * | 77,601 | 85,733 | 121,794 | 135,453 | 150,283 | 153,541 | 164,940 | |||||||||||||||||||||
Total balance sheet debt | 383,534 | 389,609 | 423,534 | 465,094 | 464,609 | 467,422 | 460,570 | |||||||||||||||||||||
Net present value of off-balance sheet rental fleet lease | 755 | 1,012 | 1,070 | 1,524 | 2,026 | 2,341 | 2,341 | |||||||||||||||||||||
Net present value of off-balance sheet production equipment leases | 3,709 | 3,991 | 4,399 | 4,966 | 5,181 | 5,564 | 5,941 | |||||||||||||||||||||
Total off-balance sheet financing | 4,464 | 5,003 | 5,469 | 6,490 | 7,207 | 7,905 | 8,282 | |||||||||||||||||||||
Total balance sheet debt and off-balance sheet financing | 387,998 | 394,612 | 429,003 | 471,584 | 471,816 | 475,327 | 468,852 | |||||||||||||||||||||
Less: cash | 24,305 | 66,498 | 37,656 | 12,945 | 18,125 | 11,288 | 132,809 | |||||||||||||||||||||
Less: limited recourse debt from finance receivables monetizations | 77,601 | 85,733 | 121,794 | 135,453 | 150,283 | 153,541 | 164,940 | |||||||||||||||||||||
Net debt | $ | 286,092 | $ | 242,381 | $ | 269,553 | $ | 323,186 | $ | 303,408 | $ | 310,498 | $ | 171,103 | ||||||||||||||
Shareholders’ Equity | $ | 284,746 | $ | 276,780 | $ | 281,270 | $ | 264,018 | $ | 252,252 | $ | 248,911 | $ | 247,714 | ||||||||||||||
Net Debt-to-Net Debt plus Shareholders’ Equity | 50 | % | 47 | % | 49 | % | 55 | % | 55 | % | 56 | % | 41 | % | ||||||||||||||
Total Balance Sheet Debt-to-Total Balance Sheet Debt plus Shareholders’ Equity | 57 | % | 58 | % | 60 | % | 64 | % | 65 | % | 65 | % | 65 | % | ||||||||||||||
* Maximum loss exposure from finance receivables monetizations | $ | 27,203 | $ | 26,068 | $ | 25,161 | $ | 23,757 | $ | 24,460 | $ | 23,380 | $ | 21,708 | ||||||||||||||
We monitor our net debt, which is a supplemental measure to GAAP that provides additional information concerning our leverage position and our historical ability to meet debt service and capital expenditure and working capital requirements. We define net debt as the sum of total balance sheet debt and other off-balance sheet financing, minus cash and limited recourse debt arising from our monetizations of customer finance receivables.
JLG Industries, Inc. — Page 12
JLG INDUSTRIES, INC.
FREE CASH FLOW
(in thousands)
Quarter Ended | Fiscal Year | Quarter Ended | Fiscal Year | |||||||||||||||||||||||||||||
January 30, | October 31, | Ended | July 31, | April 25, | January 25, | October 26, | Ended | |||||||||||||||||||||||||
2005 | 2004 | July 31, 2004 | 2004 | 2004 | 2004 | 2003 | July 31, 2003 | |||||||||||||||||||||||||
Net income (loss) | $ | 7,484 | ($8,729 | ) | $ | 26,649 | $ | 15,271 | $ | 8,687 | $ | 2,158 | $ | 533 | $ | 12,392 | ||||||||||||||||
Adjustments to reconcile net income (loss) to cash flow from operating activities: | ||||||||||||||||||||||||||||||||
Non-cash items | 5,570 | 8,698 | 30,555 | (8,619 | ) | 12,303 | 15,118 | 11,753 | 21,278 | |||||||||||||||||||||||
Accounts receivable | (29,659 | ) | 62,217 | (66,296 | ) | 18,059 | (57,552 | ) | (27,823 | ) | 1,020 | (35,324 | ) | |||||||||||||||||||
Inventories | (11,758 | ) | (16,368 | ) | 9,188 | 13,060 | (14,053 | ) | 3,296 | 6,885 | 43,137 | |||||||||||||||||||||
Other current assets | 3,497 | (2,817 | ) | 8,780 | (158 | ) | (14,211 | ) | 26,225 | (3,076 | ) | (15,960 | ) | |||||||||||||||||||
Accounts payable | (10,833 | ) | 10,554 | 33,207 | 11,982 | 31,428 | 24,751 | (34,954 | ) | (46,026 | ) | |||||||||||||||||||||
Accrued expenses | (5,837 | ) | (9,743 | ) | 4,726 | 21,424 | 10,696 | (30,514 | ) | 3,120 | 3,254 | |||||||||||||||||||||
Finance receivables | 6,970 | (8,496 | ) | (6,112 | ) | (6,756 | ) | (2,181 | ) | 1,770 | 1,055 | 40,487 | ||||||||||||||||||||
Other cash from operations | (12,920 | ) | (1,147 | ) | (11,090 | ) | (4,408 | ) | (1,921 | ) | (862 | ) | (3,899 | ) | (3,295 | ) | ||||||||||||||||
Purchases of property, plant and equipment | (2,072 | ) | (2,895 | ) | (12,387 | ) | (3,522 | ) | (2,435 | ) | (2,619 | ) | (3,811 | ) | (10,806 | ) | ||||||||||||||||
Proceeds from sale of property, plant and equipment | 81 | 81 | 90 | (127 | ) | 127 | 1 | 89 | 216 | |||||||||||||||||||||||
Purchases of equipment held for rental | (8,851 | ) | (10,089 | ) | (26,689 | ) | (10,246 | ) | (4,491 | ) | (9,743 | ) | (2,209 | ) | (16,342 | ) | ||||||||||||||||
Proceeds from sale of equipment held for rental | 16,037 | 4,150 | 33,269 | 20,563 | 8,008 | 3,557 | 1,141 | 19,063 | ||||||||||||||||||||||||
Cash portion of acquisitions | (105 | ) | — | (109,557 | ) | (14,186 | ) | — | — | (95,371 | ) | — | ||||||||||||||||||||
Other cash from investments | (56 | ) | (46 | ) | 333 | (27 | ) | 507 | (101 | ) | (46 | ) | (689 | ) | ||||||||||||||||||
Payment of dividends | (224 | ) | (220 | ) | (871 | ) | (219 | ) | (218 | ) | (218 | ) | (216 | ) | (859 | ) | ||||||||||||||||
Exercise of stock options | 1,276 | 5,086 | 2,414 | 276 | 1,242 | 746 | 150 | 93 | ||||||||||||||||||||||||
Effect of exchange rate changes on cash | (1,729 | ) | (2,767 | ) | 258 | (562 | ) | 362 | (183 | ) | 641 | 1,852 | ||||||||||||||||||||
Seller financing | — | — | (10,000 | ) | — | — | — | (10,000 | ) | — | ||||||||||||||||||||||
Capital lease assumed in OmniQuip acquisition | — | — | (3,630 | ) | — | — | — | (3,630 | ) | — | ||||||||||||||||||||||
Debt assumed in Delta acquisition | — | — | (103 | ) | (103 | ) | — | — | — | — | ||||||||||||||||||||||
Other(1) | (582 | ) | (297 | ) | (1,184 | ) | 1,931 | 3,924 | 1,531 | (8,570 | ) | 15,310 | ||||||||||||||||||||
Free Cash Flow | ($43,711 | ) | $ | 27,172 | ($98,450 | ) | $ | 53,633 | ($19,778 | ) | $ | 7,090 | ($139,395 | ) | $ | 27,781 | ||||||||||||||||
(1) | Includes changes in other off-balance sheet debt. |
In addition to measuring our cash flow generation and usage based upon the Statements of Cash Flows, we also measure our free cash flow. We define free cash flow as cash flow from operating activities, investing activities, payment of dividends, exercise of stock options, and the effect of exchange rate changes on cash less changes in accounts receivable securitization, limited recourse debt from finance receivables monetizations and off-balance sheet debt. Our measure of free cash flow may not be comparable to similarly titled measures being disclosed by other companies and is not a measure of financial performance that is in accordance with GAAP. We utilize free cash flow to explain the change in our net debt position from the prior period.
JLG Industries, Inc. — Page 13
JLG INDUSTRIES, INC.
STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
CONSOLIDATED | EQUIPMENT OPERATIONS | FINANCIAL SERVICES | ||||||||||||||||||||||
JLG Industries, Inc. and | JLG Industries, Inc. with Access | |||||||||||||||||||||||
Consolidated Subsidiaries | Financial Solutions on the Equity Basis | Access Financial Solutions | ||||||||||||||||||||||
Six Months Ended | Six Months Ended | Six Months Ended | ||||||||||||||||||||||
January 30, | January 25, | January 30, | January 25, | January 30, | January 25, | |||||||||||||||||||
2005 | 2004 | 2005 | 2004 | 2005 | 2004 | |||||||||||||||||||
Revenues | ||||||||||||||||||||||||
Net sales | $ | 650,078 | $ | 438,931 | $ | 650,078 | $ | 438,931 | $ | — | $ | — | ||||||||||||
Financial products | 5,716 | 7,118 | — | — | 5,716 | 7,118 | ||||||||||||||||||
Rentals | 4,301 | 4,066 | 4,094 | 3,930 | 207 | 136 | ||||||||||||||||||
660,095 | 450,115 | 654,172 | 442,861 | 5,923 | 7,254 | |||||||||||||||||||
Cost of sales | 580,428 | 368,402 | 580,030 | 368,240 | 398 | 162 | ||||||||||||||||||
Gross profit | 79,667 | 81,713 | 74,142 | 74,621 | 5,525 | 7,092 | ||||||||||||||||||
Selling and administrative expenses | 58,932 | 52,065 | 58,058 | 50,572 | 874 | 1,493 | ||||||||||||||||||
Product development expenses | 11,463 | 9,208 | 11,463 | 9,208 | — | — | ||||||||||||||||||
Restructuring charges | — | 11 | — | 11 | — | — | ||||||||||||||||||
Income from operations | 9,272 | 20,429 | 4,621 | 14,830 | 4,651 | 5,599 | ||||||||||||||||||
Other income (deductions): | ||||||||||||||||||||||||
Interest expense | (17,318 | ) | (19,424 | ) | (13,573 | ) | (13,836 | ) | (3,745 | ) | (5,588 | ) | ||||||||||||
Miscellaneous, net | 5,978 | 3,280 | 5,978 | 3,280 | — | — | ||||||||||||||||||
(Loss) income before taxes | (2,068 | ) | 4,285 | (2,974 | ) | 4,274 | 906 | 11 | ||||||||||||||||
Income tax (benefit) provision | (823 | ) | 1,594 | (1,184 | ) | 1,590 | 361 | 4 | ||||||||||||||||
Equity in income of Access Financial Solutions | — | — | 545 | 7 | — | — | ||||||||||||||||||
Net (loss) income | $ | (1,245 | ) | $ | 2,691 | $ | (1,245 | ) | $ | 2,691 | $ | 545 | $ | 7 | ||||||||||
(Loss) earnings per common share | $ | (.03 | ) | $ | .06 | |||||||||||||||||||
(Loss) earnings per common share - assuming dilution | $ | (.03 | ) | $ | .06 | |||||||||||||||||||
Cash dividends per share | $ | .01 | $ | .01 | ||||||||||||||||||||
Weighted average shares outstanding | 43,762 | 42,725 | ||||||||||||||||||||||
Weighted average shares outstanding - assuming dilution | 43,762 | 43,865 | ||||||||||||||||||||||
JLG Industries, Inc. — Page 14
JLG INDUSTRIES, INC.
BALANCE SHEETS
(in thousands, except per share data)
(unaudited)
CONSOLIDATED | EQUIPMENT OPERATIONS | FINANCIAL SERVICES | ||||||||||||||||||||||
JLG Industries, Inc. and | JLG Industries, Inc. with Access | |||||||||||||||||||||||
Consolidated Subsidiaries | Financial Solutions on the Equity Basis | Access Financial Solutions | ||||||||||||||||||||||
January 30, | July 31, | January 30, | July 31, | January 30, | July 31, | |||||||||||||||||||
2005 | 2004 | 2005 | 2004 | 2005 | 2004 | |||||||||||||||||||
ASSETS | ||||||||||||||||||||||||
Current assets | ||||||||||||||||||||||||
Cash and cash equivalents | $ | 24,305 | $ | 37,656 | $ | 24,305 | $ | 37,656 | $ | — | $ | — | ||||||||||||
Trade accounts and finance receivables — net | 354,350 | 400,597 | 324,145 | 332,154 | 30,205 | 68,443 | ||||||||||||||||||
Inventories | 182,606 | 154,405 | 182,606 | 154,405 | — | — | ||||||||||||||||||
Other current assets | 47,466 | 41,058 | 47,466 | 41,058 | — | — | ||||||||||||||||||
Total current assets | 608,727 | 633,716 | 578,522 | 565,273 | 30,205 | 68,443 | ||||||||||||||||||
Property, plant and equipment — net | 82,387 | 91,504 | 82,387 | 91,504 | — | — | ||||||||||||||||||
Equipment held for rental — net | 23,163 | 21,190 | 21,711 | 19,404 | 1,452 | 1,786 | ||||||||||||||||||
Finance receivables, less current portion | 36,992 | 33,747 | — | — | 36,992 | 33,747 | ||||||||||||||||||
Pledged receivables, less current portion | 50,372 | 86,559 | — | — | 50,372 | 86,559 | ||||||||||||||||||
Goodwill | 63,165 | 62,885 | 63,165 | 62,885 | — | — | ||||||||||||||||||
Intangible assets — net | 33,848 | 35,240 | 33,848 | 35,240 | — | — | ||||||||||||||||||
Investment in Access Financial Solutions | — | — | 38,316 | 37,771 | — | — | ||||||||||||||||||
Receivable from Access Financial Solutions | — | — | 3,081 | 31,398 | — | — | ||||||||||||||||||
Other assets | 80,420 | 62,603 | 80,215 | 61,955 | 205 | 648 | ||||||||||||||||||
$ | 979,074 | $ | 1,027,444 | $ | 901,245 | $ | 905,430 | $ | 119,226 | $ | 191,183 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||||
Current liabilities | ||||||||||||||||||||||||
Short-term debt and current portion of long-term debt | $ | 3,744 | $ | 1,729 | $ | 3,744 | $ | 1,729 | $ | — | $ | — | ||||||||||||
Current portion of limited recourse debt from finance receivables monetizations | 26,660 | 32,585 | — | — | 26,660 | 32,585 | ||||||||||||||||||
Accounts payable | 139,742 | 139,990 | 139,742 | 139,990 | — | — | ||||||||||||||||||
Accrued expenses | 97,795 | 118,860 | 97,633 | 118,652 | 162 | 208 | ||||||||||||||||||
Total current liabilities | 267,941 | 293,164 | 241,119 | 260,371 | 26,822 | 32,793 | ||||||||||||||||||
Long-term debt, less current portion | 302,189 | 300,011 | 302,189 | 300,011 | — | — | ||||||||||||||||||
Limited recourse debt from finance receivables monetizations, less current portion | 50,941 | 89,209 | — | — | 50,941 | 89,209 | ||||||||||||||||||
Payable to JLG Industries, Inc. | — | — | — | — | 3,081 | 31,398 | ||||||||||||||||||
Accrued post-retirement benefits | 30,423 | 29,666 | 30,423 | 29,666 | — | — | ||||||||||||||||||
Other long-term liabilities | 23,536 | 20,542 | 23,536 | 20,542 | — | — | ||||||||||||||||||
Provisions for contingencies | 19,298 | 13,582 | 19,232 | 13,570 | 66 | 12 | ||||||||||||||||||
Shareholders’ equity | ||||||||||||||||||||||||
Capital stock: | ||||||||||||||||||||||||
Authorized shares: 100,000 at $.20 par value | ||||||||||||||||||||||||
Issued and outstanding shares: 44,700 shares; fiscal 2004 — 43,903 shares | 8,940 | 8,781 | 8,940 | 8,781 | 30,000 | 30,000 | ||||||||||||||||||
Additional paid-in capital | 37,087 | 29,571 | 37,087 | 29,571 | — | — | ||||||||||||||||||
Retained earnings | 252,579 | 254,268 | 252,579 | 254,268 | 8,316 | 7,771 | ||||||||||||||||||
Unearned compensation | (3,433 | ) | (5,333 | ) | (3,433 | ) | (5,333 | ) | — | — | ||||||||||||||
Accumulated other comprehensive loss | (10,427 | ) | (6,017 | ) | (10,427 | ) | (6,017 | ) | — | — | ||||||||||||||
Total shareholders’ equity | 284,746 | 281,270 | 284,746 | 281,270 | 38,316 | 37,771 | ||||||||||||||||||
$ | 979,074 | $ | 1,027,444 | $ | 901,245 | $ | 905,430 | $ | 119,226 | $ | 191,183 | |||||||||||||
JLG Industries, Inc. — Page 15
JLG INDUSTRIES, INC.
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
CONSOLIDATED | EQUIPMENT OPERATIONS | FINANCIAL SERVICES | ||||||||||||||||||||||
JLG Industries, Inc. and | JLG Industries, Inc. with Access | |||||||||||||||||||||||
Consolidated Subsidiaries | Financial Solutions on the Equity Basis | Access Financial Solutions | ||||||||||||||||||||||
Six Months Ended | Six Months Ended | Six Months Ended | ||||||||||||||||||||||
January 30, | January 25, | January 30, | January 25, | January 30, | January 25, | |||||||||||||||||||
2005 | 2004 | 2005 | 2004 | 2005 | 2004 | |||||||||||||||||||
Operations | ||||||||||||||||||||||||
Net (loss) income | $ | (1,245 | ) | $ | 2,691 | $ | (1,245 | ) | $ | 2,691 | $ | 545 | $ | 7 | ||||||||||
Adjustments to reconcile net (loss) income to cash flow from operating activities: | ||||||||||||||||||||||||
(Gain) loss on sale of property, plant and equipment | 142 | 53 | 142 | 50 | — | 3 | ||||||||||||||||||
(Gain) loss on sale of equipment held for rental | (6,634 | ) | 1,364 | (6,634 | ) | 1,364 | — | — | ||||||||||||||||
Non-cash charges and credits: | ||||||||||||||||||||||||
Depreciation and amortization | 14,046 | 13,252 | 13,648 | 13,098 | 398 | 154 | ||||||||||||||||||
Other | 6,714 | 12,202 | 7,115 | 11,702 | (401 | ) | 500 | |||||||||||||||||
Changes in selected working capital items: | ||||||||||||||||||||||||
Accounts receivable | 32,558 | (26,803 | ) | 4,124 | (31,840 | ) | 28,434 | 5,037 | ||||||||||||||||
Inventories | (28,126 | ) | 10,181 | (28,126 | ) | 10,181 | — | — | ||||||||||||||||
Accounts payable | (279 | ) | (10,203 | ) | (279 | ) | (10,203 | ) | — | — | ||||||||||||||
Other operating assets and liabilities | (14,900 | ) | (4,245 | ) | (14,854 | ) | (4,229 | ) | (46 | ) | (16 | ) | ||||||||||||
Changes in finance receivables | (1,526 | ) | 2,825 | — | — | (1,526 | ) | 2,825 | ||||||||||||||||
Changes in pledged finance receivables | 474 | (16,627 | ) | — | — | 474 | (16,627 | ) | ||||||||||||||||
Changes in other assets and liabilities | (14,067 | ) | (4,761 | ) | (14,564 | ) | (4,005 | ) | 497 | (756 | ) | |||||||||||||
Cash flow from operating activities | (12,843 | ) | (20,071 | ) | (40,673 | ) | (11,191 | ) | 28,375 | (8,873 | ) | |||||||||||||
Investments | ||||||||||||||||||||||||
Purchases of property, plant and equipment | (4,967 | ) | (6,430 | ) | (4,967 | ) | (6,430 | ) | — | — | ||||||||||||||
Proceeds from the sale of property, plant and equipment | 162 | 90 | 162 | 90 | — | — | ||||||||||||||||||
Purchases of equipment held for rental | (18,940 | ) | (11,952 | ) | (18,876 | ) | (11,691 | ) | (64 | ) | (261 | ) | ||||||||||||
Proceeds from the sale of equipment held for rental | 20,187 | 4,698 | 20,187 | 4,698 | — | — | ||||||||||||||||||
Cash portion of acquisitions | (105 | ) | (95,371 | ) | (105 | ) | (95,371 | ) | — | — | ||||||||||||||
Investment in income of Access Financial Solutions | — | — | (545 | ) | (7 | ) | — | — | ||||||||||||||||
Other | (102 | ) | (147 | ) | (102 | ) | (147 | ) | — | — | ||||||||||||||
Cash flow from investing activities | (3,765 | ) | (109,112 | ) | (4,246 | ) | (108,858 | ) | (64 | ) | (261 | ) | ||||||||||||
Financing | ||||||||||||||||||||||||
Net increase in short-term debt | 2,013 | 58 | 2,013 | 58 | — | — | ||||||||||||||||||
Issuance of long-term debt | 130,054 | 99,000 | 130,054 | 99,000 | — | — | ||||||||||||||||||
Repayment of long-term debt | (130,232 | ) | (99,205 | ) | (130,232 | ) | (99,205 | ) | — | — | ||||||||||||||
Issuance of limited recourse debt | — | 13,979 | — | — | — | 13,979 | ||||||||||||||||||
Repayment of limited recourse debt | — | (253 | ) | — | — | — | (253 | ) | ||||||||||||||||
Change in receivable from Access Financial Solutions | — | — | 28,317 | 4,592 | — | — | ||||||||||||||||||
Change in payable to JLG Industries, Inc. | — | — | — | — | (28,317 | ) | (4,592 | ) | ||||||||||||||||
Payment of dividends | (444 | ) | (434 | ) | (444 | ) | (434 | ) | — | — | ||||||||||||||
Exercise of stock options | 6,362 | 896 | 6,362 | 896 | — | — | ||||||||||||||||||
Cash flow from financing activities | 7,753 | 14,041 | 36,070 | 4,907 | (28,317 | ) | 9,134 | |||||||||||||||||
Currency Adjustments | ||||||||||||||||||||||||
Effect of exchange rate changes on cash | (4,496 | ) | 458 | (4,502 | ) | 458 | 6 | — | ||||||||||||||||
Cash and Cash Equivalents | ||||||||||||||||||||||||
Net change in cash and cash equivalents | (13,351 | ) | (114,684 | ) | (13,351 | ) | (114,684 | ) | — | — | ||||||||||||||
Beginning balance | 37,656 | 132,809 | 37,656 | 132,809 | — | — | ||||||||||||||||||
Ending balance | $ | 24,305 | $ | 18,125 | $ | 24,305 | $ | 18,125 | $ | — | $ | — | ||||||||||||
# # #