Exhibit 99.2
[JLG logo] PRESS RELEASE
JLG INDUSTRIES, INC. FOR IMMEDIATE RELEASE
1 JLG Drive
McConnellsburg, PA 17233-9533 CONTACT: JUNA ROWLAND
Telephone (717) 485-5161 DIRECTOR - CORPORATE & INVESTOR RELATIONS
Fax (717) 485-6417 (240) 313-1816, IR@JLG.COM
www.jlg.com
JLG CONTINUES TO IMPROVE CASH FLOW AND REDUCE DEBT
COMPANY CONTINUES MANAGING FOR CASH
MCCONNELLSBURG, PA, FEBRUARY 22, 2002 - JLG Industries, Inc. (NYSE:
JLG) today announced results for the fiscal second quarter ended January 31,
2002, with consolidated revenues of $156 million and diluted earnings per share
of $.03 compared to last year's record revenues of $230 million and diluted
earnings per share of $.12. Despite the current economic environment, free cash
flow was $29 million, an improvement of $106 million over last year's use of
cash in the second quarter. Debt was reduced an additional $36 million in the
quarter resulting in debt-to-total capitalization of 46 percent compared with 49
percent at the end of the previous quarter and 53 percent at the end of fiscal
2001. During the quarter, the Company determined that certain volume-related
customer incentives would not be achieved and that it would not be making a
discretionary profit sharing contribution. These changes in estimates resulted
in a $.11 benefit to diluted earnings per share during the quarter.
Year-to-date, sales were $313 million, also down 32 percent from last
year's record first half. Despite this decline, earnings per share remain
positive at $.09 versus $.42 last year. Cash flow was a strong $86 million
compared to a use of cash of $133 million last year reflecting a $97 million
reduction in trade working capital. Since the beginning of the year, total debt
has been reduced by $93 million.
"Our strong improvement in cash flow, additional de-leveraging and
continued profitability is the result of our successful strategy for managing
through this economic downturn," stated Bill Lasky, Chairman of the Board,
President and Chief Executive Officer. "As we enter the second half of our
fiscal year, we are executing our fiscal 2002 initiatives to prepare JLG for the
rebound of the North American and European markets and further strengthening our
leadership position. Major near-term objectives include further optimizing our
manufacturing capacity and bringing value engineering concepts to the design of
common platforms. Maintaining strong brand equity for our products with renewed
emphasis on global supply chain management, distribution and infrastructure also
will enhance our industry and technology leadership as we embrace new growth
opportunities and prepare for the economic rebound. My confident outlook is
buoyed by pride in our super team of employees who made this quarter a success
under adverse conditions and who understood the economic challenges that led to
our elimination of this year's profit sharing contribution."
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JLG Industries, Inc. - page 2
SECOND QUARTER FINANCIAL SUMMARY
o North American revenues were $115 million, down 33 percent compared to
last year, and up 4 percent when compared to the fiscal 2002 first
quarter.
o European revenues were $34 million, down 32 percent from the prior-year
quarter, and off 13 percent sequentially.
o Telehandler sales were $19 million, up 12 percent year-on-year, and up
substantially by 32 percent on a sequential quarter basis.
o Sales of new products represented 27 percent of total sales.
o Selling, administrative and product development expenses were reduced 31
percent year-on-year (16 percent sequentially).
o Trade working capital was reduced $40 million from the first quarter.
o Continued investment in innovative new products including the acquisition
of the European telehandler product family.
FISCAL YEAR FIRST HALF FINANCIAL SUMMARY
o Free cash flow was $86 million, an improvement of $219 million over last
year's use of cash in the first six months.
o North American revenues were $226 million, down 37 percent compared to
last year's record first half.
o European revenues were $73 million, down 15 percent from the prior-year's
first half.
o Trade working capital was reduced by $97 million year-to-date.
o Debt was reduced by $93 million from July 31, 2001.
FINANCIAL OVERVIEW
Jim Woodward, Senior Vice President and Chief Financial Officer said,
"Consistent with our focus on the balance sheet, free cash flow was strong at
$29 million compared with a use of cash of $77 million last year. Debt was
reduced by an additional $36 million in the quarter and $93 million since the
beginning of the current fiscal year. Including off-balance sheet financing of
accounts receivable and various production equipment and rental fleet leases,
debt-to-total capitalization was reduced to 46 percent from 49 percent for the
first quarter, and from 53 percent at last fiscal year-end. Trade working
capital was reduced by $40 million in the second quarter and by $97 million
since the beginning of fiscal 2002.
"Manufacturing margins at 15.7 percent compared to 18.0 percent a year ago
were adversely impacted by extended plant shutdowns to adjust inventory. During
the quarter all manufacturing facilities were shut down for nearly half of the
available production days. On a year-on-year comparative basis, production hours
during the second quarter were down 69 percent for boom lifts, 83 percent for
scissor lifts, 42 percent for telehandlers, and 43
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JLG Industries, Inc. - page 3
percent for excavators. As a result, finished goods inventory was reduced by $30
million with total ending inventory, at $150 million, being reduced by $33
million on a sequential quarter basis. Operating margin was 3.3 percent compared
with 5.1 percent last year, primarily reflecting the sales decline offset in
part by a 26 percent reduction in selling, administrative and product
development expenses, excluding the change relating to the profit sharing
contribution, and the elimination of goodwill amortization. As an early adopter
of SFAS No. 142 `Goodwill and Other Intangible Assets,' we performed the initial
testing which preliminarily indicated a range of goodwill impairment depending
on valuation methodologies. We will finalize the measurement of and record the
impairment by the end of our fiscal year with no effect on cash, consistent with
the SFAS guidelines.
"From the outset of the year, we had expected the first half of fiscal
2002 to be extremely challenging, and the second quarter proved to be no
exception. Since January 2001, through our productivity improvements, focus on
core activities and movement of production to the new Belgium plant, we have
reduced JLG's workforce by 1,275 people, or almost 33 percent. And, the closure
of the Orrville, Ohio facility announced today in a separate release will result
in a net reduction of approximately 90 more people over the course of the next
eight months and an estimated $7.7 million one-time pre-tax charge during the
third quarter with a payback period of slightly over one year. Ongoing
rationalization efforts are expected to further reduce our cost structure and
enhance JLG's industry-leading position. We will continue to evaluate and to
address production needs as we monitor the business environment.
"Additionally, we have changed our manufacturing model to correlate
production more closely with customer orders, thereby reducing our inventory
requirements. Should the economy remain relatively stable, we expect revenues
during the second half of this fiscal year to be comparatively equal to last
year's period. Combined with the successful reduction in our finished goods
inventory during the first half, we expect to recall approximately 310 people
during the third quarter to support second half requirements."
OUTLOOK
Commenting on the outlook, Bill Lasky stated, "As we position JLG for
future growth, innovative new products will provide our end-users with the
necessary tools to perform their jobs safely and productively. Exciting new
products like the 135-foot high-reach boom lift and additional accessory
packages in our "Workstation in the Sky"TM series will further enhance our
product portfolio. Many other exciting new aerial work platform and material
handler products are being introduced and will be on display at the
CONEXPO-CON/AGG 2002 trade show to be held in Las Vegas, Nevada in March.
Additionally, we recently announced our entry into the European telehandler
market with the introduction of our new European telehandler family to be
produced at
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JLG Industries, Inc. - page 4
our Maasmechelen, Belgium facility. This is a market segment in which JLG has
not previously engaged and we expect incremental sales from this product group
to significantly contribute to future growth and profitability.
"We remain profitable and continue to generate significant cash flow in
a very challenging economic environment. We are committed to our stated
strategic initiatives and we will continue managing for cash. As we realign the
organization and rationalize capacity, we will continue to benefit from ongoing
cost savings.
"We reiterate a strong positive cash flow forecast for the full year in
the range of $125 to $150 million through a continued focus on free cash flow
and inventory reductions. Visibility for spring season orders is improving as
customers reassess their needs in anticipation of economic recovery. Therefore,
assuming stability in the economy, we expect our sales for the balance of the
year to be relatively flat, year-on-year, and earnings per share, for the full
year in a range of $0.65 to $0.75, excluding one-time charges and goodwill
impairment."
CONFERENCE CALL
The Company will host a conference call on Monday, February 25, 2002 at
9:30 a.m. Eastern Time. Dial-in number is (800) 289-0529, access code: 792435 or
via the Internet at www.jlg.com under the Investors section. An accompanying
slide presentation will also be available via the Internet at www.jlg.com.
Please dial into the conference 10 minutes prior to the start. A recording of
this conference call will be available at (888) 203-1112 access code 792435
until midnight on March 15, 2002.
ABOUT JLG
JLG Industries, Inc. is the world's leading producer of mobile aerial work
platforms and a leading producer of variable-reach material handlers and
telescopic hydraulic excavators marketed under the JLG and Gradall trademarks.
Sales are made principally to rental companies and distributors that rent and
sell the Company's products to a diverse customer base, which include users in
the industrial, commercial, institutional and construction markets. JLG's
manufacturing facilities are located in the United States and Belgium, with
sales and service locations on six continents.
This news release contains forward-looking statements as defined by the
Private Securities Litigation Reform Act of 1995, including but not limited to
those relating to financial projections and future financial performance,
cost-cutting and manufacturing improvement efforts, future market conditions
and trends, the growth of the Company's businesses, product demand, the
introduction of new products, and the opening of new facilities. The
forward-looking statements in this announcement may involve certain risks and
uncertainties, which could cause actual results to differ materially,
including cyclical demand, a consolidating customer base, competition,
continued innovation, product liability, availability of product components,
and other risks, as detailed in the Company's SEC reports, including the
report on Form 10-Q for the quarter ended October 31, 2001.
For more information, visit www.jlg.com.
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JLG Industries, Inc. - page 5
JLG INDUSTRIES, INC.
CONSOLIDATED SELECTED SUPPLEMENTAL INFORMATION
(in thousands)
(unaudited)
Three Months Ended Six Months Ended
January 31, January 31,
SEGMENT INFORMATION 2002 2001 2002 2001
---- ---- ---- ----
External revenues:
Machinery $ 127,791 $ 191,600 $ 260,121 $ 401,293
Equipment services 28,561 38,493 52,393 61,510
--------- --------- --------- ---------
$ 156,352 $ 230,093 $ 312,514 $ 462,803
========= ========= ========= =========
Segment profit (loss):
Machinery $ 3,378 $ 16,766 $ 7,807 $ 46,057
Equipment services 7,621 4,540 16,444 12,322
General corporate expenses (5,889) (9,549) (12,189) (21,443)
--------- --------- --------- ---------
$ 5,110 $ 11,757 $ 12,062 $ 36,936
========= ========= ========= =========
PRODUCT GROUP REVENUES
Aerial work platforms $ 94,559 $ 158,907 $ 200,218 $ 336,234
Material handlers 18,624 16,623 32,728 36,991
Excavators 14,608 16,070 27,175 28,068
Financing and leasing activities and
after-sales service and support,
including parts sales, equipment rentals,
used equipment sales and reconditioned
equipment 28,561 38,493 52,393 61,510
--------- --------- --------- ---------
$ 156,352 $ 230,093 $ 312,514 $ 462,803
========= ========= ========= =========
GEOGRAPHIC REVENUES
United States $ 112,643 $ 168,801 $ 220,065 $ 351,906
Europe 33,923 49,869 73,009 85,922
Other international 9,786 11,423 19,440 24,975
--------- --------- --------- ---------
$ 156,352 $ 230,093 $ 312,514 $ 462,803
========= ========= ========= =========
FREE CASH FLOW
Cash flow from net income plus
non-cash charges $ 8,245 $ 11,924 $ 17,626 $ 35,944
Accounts receivable (1) 37,296 13,474 80,730 1,374
Inventory 33,308 (50,402) 39,920 (90,459)
Finance receivables (11,130) (52,424) (7,662) (52,424)
Other (36,558) 14,174 (38,419) (11,754)
Net purchases of PP&E (3,297) (1,838) (6,497) (4,695)
Net change in equipment held for rental (845) 5,716 (10,143) 1,938
Proceeds from sale of joint venture -- -- -- 4,000
Other off balance sheet debt (1) 2,369 (17,561) 10,385 (17,275)
--------- --------- --------- ---------
Free cash flow $ 29,388 ($ 76,937) $ 85,940 ($133,351)
========= ========= ========= =========
(1) Includes changes in accounts receivable securitization and other
off-balance sheet debt.
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JLG Industries, Inc. - page 6
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
Three Months Ended Six Months Ended
January 31, January 31,
2002 2001 2002 2001
---- ---- ---- ----
Revenues
Net sales $ 150,369 $ 228,109 $ 300,575 $ 459,575
Rentals 2,777 1,539 5,584 2,781
Financial products 3,206 445 6,355 447
--------- --------- --------- ---------
156,352 230,093 312,514 462,803
Cost of sales 131,822 188,618 257,924 368,838
--------- --------- --------- ---------
Manufacturing profit 24,530 41,475 54,590 93,965
Selling and administrative expenses 15,756 24,125 34,861 46,030
Product development expenses 3,664 4,105 7,667 8,020
Goodwill amortization -- 1,488 -- 2,979
--------- --------- --------- ---------
Income from operations 5,110 11,757 12,062 36,936
Other income (deductions):
Interest expense (4,027) (6,052) (8,365) (10,108)
Miscellaneous, net 909 2,053 1,826 1,576
--------- --------- --------- ---------
Income before taxes 1,992 7,758 5,523 28,404
Income tax provision 658 2,861 1,823 10,500
--------- --------- --------- ---------
Net income $ 1,334 $ 4,897 $ 3,700 $ 17,904
========= ========= ========= =========
Earnings per common share $ .03 $ .12 $ .09 $ .42
========= ========= ========= =========
Earnings per common share -
assuming dilution $ .03 $ .12 $ .09 $ .42
========= ========= ========= =========
Cash dividends per share $ .005 $ .01 $ .015 $ .02
========= ========= ========= =========
Weighted average shares outstanding 41,813 41,866 41,816 42,512
========= ========= ========= =========
Weighted average shares outstanding -
assuming dilution 42,399 42,572 42,409 43,023
========= ========= ========= =========
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JLG Industries, Inc. - page 7
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands, except per share data)
January 31, July 31,
2002 2001
----------- ---------
ASSETS (unaudited)
- ------
Current assets
Cash and cash equivalents $ 3,572 $ 9,254
Accounts receivable (1) 142,300 189,913
Finance receivables 18,753 16,760
Inventories 150,038 189,841
Other current assets 20,043 18,787
--------- ---------
Total current assets 334,706 424,555
Property, plant and equipment 96,437 98,403
Equipment held for rental 27,533 20,002
Finance receivables, less current portion 119,894 115,071
Goodwill 140,164 140,164
Other assets 24,333 27,394
--------- ---------
$ 743,067 $ 825,589
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term debt $ 23,011 $ 22,193
Accounts payable 53,759 76,723
Accrued expenses 56,278 70,887
--------- ---------
Total current liabilities 133,048 169,803
Long-term debt, less current portion 226,293 276,994
Accrued post-retirement benefits 24,338 23,757
Other long-term liabilities 10,075 9,601
Provisions for contingencies 12,066 11,993
Shareholders' equity
Capital stock:
Authorized shares: 100,000 at $.20 par value
Outstanding shares: 42,131; fiscal 2001 - 42,144 8,426 8,429
Additional paid-in capital 14,144 14,256
Retained earnings 322,675 319,607
Unearned compensation (2,683) (3,377)
Accumulated other comprehensive income (5,315) (5,474)
--------- ---------
Total shareholders' equity 337,247 333,441
--------- ---------
$ 743,067 $ 825,589
========= =========
(1) Net of accounts receivable securitization of $18,100 at January 31, 2002,
and $50,600 at July 31, 2001.
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JLG Industries, Inc. - page 8
JLG INDUSTRIES, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Six Months Ended
January 31
2002 2001
---- ----
OPERATIONS
Net income $ 3,700 $ 17,904
Adjustments to reconcile net income to
cash flow from operating activities:
Gain from sale of joint venture -- (1,008)
Non-cash charges and credits:
Depreciation and amortization 11,119 12,935
Other 3,552 6,238
Changes in selected working capital items:
Accounts receivable (1) 48,230 (8,502)
Inventories 39,920 (90,459)
Other operating assets and liabilities (39,811) (13,478)
Changes in finance receivables (7,662) (52,424)
Changes in other assets and liabilities 1,392 1,724
--------- ---------
Cash flow from operating activities 60,440 (127,070)
INVESTMENTS
Net purchases of property, plant and equipment (6,497) (4,695)
Net change in equipment held for rental (10,143) 1,938
Proceeds from sale of joint venture -- 4,000
--------- ---------
Cash flow from investing activities (16,640) 1,243
FINANCING
Net increase in short-term debt 816 12,090
Issuance of long-term debt 221,459 264,150
Repayment of long-term debt (272,157) (137,597)
Payment of dividends (631) (860)
Purchase of common stock -- (22,201)
Exercise of stock options and issuance of restricted awards 570 70
--------- ---------
Cash flow from financing activities (49,943) 115,652
CURRENCY ADJUSTMENTS
Effect of exchange rate changes on cash 461 (477)
--------- ---------
CASH
Net change in cash and cash equivalents (5,682) (10,652)
Beginning balance 9,254 25,456
--------- ---------
Ending balance $ 3,572 $ 14,804
========= =========
(1) Net of accounts receivable securitization of $18,100 at January 31, 2002
and $47,500 at January 31, 2001.
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