Yahoo Finance Oshkosh Corp (OSK) Q1 2024 Earnings Call Transcript Highlights: Robust Growth and Optimistic ...
Revenue: Q1 2024 revenue was $2.54 billion, a 12.2% increase year-over-year.
Adjusted Operating Income: Increased by $124 million to $275 million, representing 10.8% of sales.
Adjusted EPS: $2.89 in Q1 2024, up from $1.63 in the prior year quarter.
Full Year Outlook for Adjusted EPS: Raised to $11.25 per share.
Segment Revenue - Access: Grew by 3.7% in Q1; expected full-year sales of $5.4 billion.
Segment Revenue - Defense: Transition year with production changes; full-year sales expected at approximately $2.1 billion.
Segment Revenue - Vocational: Increased by 37% in Q1, including $176 million from AeroTech sales; full-year sales expected at $3.2 billion.
Free Cash Flow and CapEx: Expectations for the year remain unchanged.
Corporate Expenses: Estimated at approximately $190 million for the year.
Effective Tax Rate: Revised to 24% for the year.
Share Count: Expected to be 65.8 million shares.
Release Date: April 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you discuss the longer-term outlook for EV and next-gen programs, particularly as you move from preproduction to significant revenue generation, expected around early 2026? How should we think about margins for these programs? A: (Michael E. Pack - EVP & CFO) As we ramp up NGDV production, we expect startup costs this year, leading to a significant volume increase next year. By 2026, we anticipate full-rate production, exceeding $1 billion in revenue from this program, with margins better than our traditional tactical wheeled vehicle margins.
Q: With the U.S. Postal Service ramping up significantly this year and next, can you discuss opportunities in last mile delivery and potential market share expansion based on the Postal Service win? A: (John C. Pfeifer - President, CEO & Director) Our focus is on successfully executing the NGDV program for the U.S. Postal Service, which is the largest fleet of last mile delivery vehicles. While we engage with other service providers, our priority is ensuring the success of this program, which we believe will drive significant growth.
Q: What are the potential margins for the Fire & Emergency segment, considering the pricing in backlog and normalizing logistics costs? A: (Michael E. Pack - EVP & CFO) We are optimistic about the Vocational segment, expecting it to be a $12-plus billion segment with strong margins, benefiting from segment synergies, pricing in backlog, and new product introductions.
Q: Can you provide insights into the Defense segment's revenue and margin outlook as the JLTV program winds down and the NGDV ramps up? A: (John C. Pfeifer - President, CEO & Director) In 2025, as JLTV production ends and NGDV production increases, we expect NGDV revenue to exceed the outgoing JLTV revenue, with improving margins due to sole-sourced contracts and high-priority DoD programs.
Q: How should we think about the Access segment's margin progression throughout the year, given the strong performance in Q1? A: (Michael E. Pack - EVP & CFO) The favorable mix in Q1 drove high margins, but we anticipate a moderation due to the timing of new product development spending and start-up costs, impacting margins in the subsequent quarters.
Q: With the CAT telehandler supply partnership ending this year, what are the expectations for renewal and potential impacts on pricing or profitability? A: (John C. Pfeifer - President, CEO & Director) While not commenting on specific contract details, JLG remains a leading provider in the telehandler market, and we anticipate continued growth and market share expansion, regardless of the partnership outcome with CAT.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
