oshkosh corporation (nyse:osk)...2014/02/28 · 1850sj ultra boom industry’s largest work...

MOVING THE WORLD AT WORK

Oshkosh Corporation (NYSE:OSK)2014 AEM Investor Conference

March 5, 2014


Forward-Looking Statements

22014 AEM Investor Conference March 5, 2014

This presentation contains statements that the Company believes to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including, withoutlimitation, statements regarding the Company’s future financial position, business strategy, targets, projected sales, costs,earnings, capital expenditures, debt levels and cash flows, and plans and objectives of management for future operations, areforward-looking statements. When used in this presentation, words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “project” or “plan” or the negative thereof or variations thereon or similar terminology are generally intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond the Company’s control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the cyclical nature of the Company’s access equipment, commercial and fire & emergency markets, especially with the current outlook for the U.S. and European economic recoveries; the strength of emerging market growth and projected adoption rate of work at height machinery; the expected level and timing of DoD and international defense customers procurement of products and services and funding thereof; risks related to reductions in government expenditures in light of U.S. defense budget pressures, sequestration and an uncertain DoD tactical wheeled vehicle strategy, including the Company’s ability to successfullymanage the cost reductions required as a result of the significant projected decrease in sales levels in the defense segment; the Company’s ability to win a U.S. JLTV production contract award; the Company’s ability to increase prices to raise margins or offset higher input costs; increasing commodity and other raw material costs, particularly in a sustained economic recovery; risks related to facilities consolidation and alignment, including the amounts of related costs and charges and that anticipated cost savings may not be achieved; the duration of the ongoing global economic uncertainty, which could lead to additional impairment charges related to many of the Company’s intangible assets and/or a slower recovery in the Company’s cyclical businesses thanCompany or equity market expectations; risks related to the collectability of receivables, particularly for those businesses with exposure to construction markets; the cost of any warranty campaigns related to the Company’s products; risks related to production or shipment delays arising from quality or production issues; risks associated with international operations and sales, including foreign currency fluctuations and compliance with the Foreign Corrupt Practices Act; the Company’s ability to comply with complex laws and regulations applicable to U.S. government contractors; and risks related to the Company’s ability to successfully execute on its strategic road map and meet its long-term financial goals. Additional information concerning these and other factors is contained in the Company’s filings with the Securities and Exchange Commission, including the Form 8-K filed January 28, 2014. All forward-looking statements speak only as of the date of this presentation. The Company assumes no obligation, and disclaims any obligation, to update information contained in this presentation. Investors should be aware that the Company may not update such information until the Company’s next quarterly earnings conference call, if at all.


Oshkosh Corporation Leading provider of specialty vehicles

• Moving the World at Work

Nearly 100 years in business; incorporated in 1917

Four business segments

FY13 Revenue: $7.7 billion

Market Capitalization (1): $4.8 billion

December 2013 Net Debt (2): $380 million

15 year TSR(3): ~1,200%1 year TSR(3): ~80%

(1) As of February 27, 2014(2) Net debt is total debt less cash(3) TSR is Total Shareholder Return. Source: ThomsonONE. From September 30, 1998 to September 30, 2013 and

September 28, 2012 to September 30, 2013, respectively

Access Equipment Defense

Fire & Emergency Commercial



Access Equipment Segment


Access Equipment

Replacement demand continues to drive North American market• NRCs: ~ flat; IRCs: up• Fleet growth with a few customers

Improving in select global markets• Europe and Middle East stronger• Positive conditions in Latin America• Australia remains weak

Severe weather has caused supplier disruptions and production delays• Will impact Q2 sales and earnings• Full year results are not expected to

be impacted

March 5, 20142014 AEM Investor Conference 5


North American Market Metrics Remain SolidRefreshing Fleets, Increasing Penetration

Residential and Non-Residential Spending(Y-O-Y % Change)

N.A. Rental Equipment Access - Fleet Age(AWP & TMH)

N.A. Rental Equipment Company Fleet Utilization

Recent Used Equipment Value Trends(OLV)

Source: Global Insight Estimates, December 2013

Based on International Rental News/Dan Kaplan sample of medium to large NA rental equipment companies (United Rentals, RSC, H&E, HERC).

(% C

hang

e)(%

Tim

e U

tiliz

atio

n)

OLV

(% o

f Cos

t)

Source: Rouse Rental Report. Calendar year-end data for 2008-13

(Age

in M

onth

s)

6

Source: Rouse Asset Services, January 2014Note: Rouse rebased the Rouse Value IndexTM in January 2014

‐40%

‐30%

‐20%

‐10%

0%

10%

20%

30%

2008 2009 2010 2011 2012 2013E 2014E 2015E

Residential Non‐Residential

50

55

60

65

70

75

Ind. Avg.

March 5, 20142014 AEM Investor Conference

40

45

50

55

60

2008 2009 2010 2011 2012 2013

25.0

30.0

35.0

40.0

45.0

Articulating Booms Scissor LiftsTelescopic Booms Telehandlers


FY14 Outlook: Access Equipment (Dollars in millions)


Fiscal Fiscal2013 2014

Actual Outlook*

Net Sales $3,120.8 $3,350 - $3,400 % Change 6.9% 7.3% - 8.9%

AdjustedOperating Income $388.6**

% Change 69.6%% Margin 12.5% 14.25% - 14.5%

Comments

Projected sales up ~10% to 12%, excluding military telehandlers

Margins expected to improve 175 – 200 bps

• Closing in on FY15 target of 15%

• Well above prior peak margins of 11.3%

* As of January 28, 2014** Non-GAAP results. See Appendix: Non-GAAP to GAAP Reconciliation


Value Innovation Initiatives Evident at ConExpo

Enhancing customers’ performance at work• Increasing capability• Improving productivity• Assuring safe operation

Lowering operating costs Reducing environmental

impacts



Aerial Work Platform Innovation -1850SJ Ultra Boom Industry’s largest work envelope

• Extends work height to 19 stories• Reach envelope increases from 2.3 million

cubic feet to ~ 3.0 million cubic feet Leader in productivity

• Capacity, gradeability, lift/drive speed and setup time

20 foot telescopic jib• Additional reach up, over and around

Innovative LCD display• Improves operation and service

Transportable without oversize permit


Launching at ConExpo


Enhancing North America’s #1 Telehandler -Refreshed SkyTrak® Telehandler FamilyModernizes operator controls/comfort; sustains ease of operation and reliability


Hydraulic system• Single joystick design• Improved operator control• Faster boom speeds

Enhanced cab layout• Redesigned dash panel• Integrated arm rest

Standard retrieval hitch Air conditioning

• Aftermarket accessory Updated styling



Telehandler Innovation -Rental Series TelehandlersDesigned for the rental market, by the rental market


Product offering details• 3614RS (3600kg; 14m)• 4017RS (4000kg; 17m)• Stage IIIb engines

Low cost of ownership• Powertrain – market proven• Service – maximized intervals• Transport – 2 machines/truck

Simple design Easily serviced


Rugged Cab, Single Joystick Easy Access to Components


Hybrid Technology Innovation -H340AJ Hybrid Boom LiftHybrid technology for construction and industrial sectors with diesel-like performance


Highly efficient• Direct electric drive results in

unmatched terrainability Two operating power modes

• More than 7 hours of continuous battery-only operation in electric mode

Low environmental impact• Noise, emissions and

potential for leaks minimized



Vertical Mast Boom Innovation -T32E ToucanInnovations provide better maneuverability, more access and increased productivity


High efficiency, direct electric drive with brushless AC motors• Nearly 80% reduction in hoses and fittings

Simplified controls with smooth, proportional operation

Telescopic articulating jib for outstanding reach

Highly maneuverable, compact machine• 3ft 9in frame enables access to confined

work areas On-board diagnostics, easier to service



Commercial Segment


Commercial

Expect U.S. housing starts to grow in 2014 and 2015• Supports positive concrete

mixer outlook Remain focused on operational

improvements to deliver higher margins• Expect greater benefit in 2H FY14

and throughout FY15 Expect RCV market to return to

growth in FY14



Trending in line with Analyst Day expectations through FY15

Construction: Substantial MixerOpportunities with Modest Recovery

Housing Starts and Mixer Shipments (1959-2013)

16

Sources: Housing Starts - U.S. Census Bureau. Mixer Shipments - Truck Mixer Manufacturers Bureau; U.S. and Canada.

March 5, 20142014 AEM Investor Conference

0.5

0.7

0.9

1.1

1.3

1.5

1.7

1.9

2012 2013 2014E 2015EHou

sing

Sta

rts

(uni

ts in

mill

ions

)

U.S. Housing Starts Forecasts

Moodys Portland Cement AssociationGlobal Insight Average Analyst Estimate

0

2,000

4,000

6,000

8,000

10,000

12,000

0

500

1,000

1,500

2,000

2,500

Mixer units

Hou

sing

Sta

rts

in M

illio

ns

Housing Starts Mixer Units Shipped Moody’s – Jan.’14Global Insight – Dec. ’13PCA – Nov. ‘13


FY14 Outlook: Commercial(Dollars in millions)


Fiscal Fiscal2013 2014

Actual Outlook*

Net Sales $766.9 $850 - $900 % Change 10.0% 10.8% - 17.4%

Operating Income $41.3% Change 28.8%% Margin 5.4% 6.75% - 7.0%

Comments Concrete placement

sales projected up 15% to 20%

Margins expected to improve 135 – 160 bps

• Target margins expand to 10% as housing recovery accelerates

• FY14 margins approximate prior cycle peak on 17% lower sales

* As of January 28, 2014


Commercial Concrete InnovationImproved Concrete Mixer ControlsCommand Center Controls State of the art driver interface

• Enhanced information display screen • Self diagnostic capabilities• Safer vehicle operation• Visual display for systems & status• Touch screen functionality


McNeilus Branded Camera Systems Industry leading functionality

• 9” touch screen display• Supports up to 5 cameras; we have your

back, front, sides and traffic alert• Event trigger with loop recording• Infrared night vision


Enhanced Concrete Drum

Increased Capacity• 11.5 yd3 capacity without increase

to wheelbase Larger drum head/shorter body

• Increases capacity & lowers center of gravity

Redesigned head impeller• Patent pending• Better mixing, less head pack & balling• Less damage, easier maintenance

Enhanced fin design• Smoother spiral, better discharge• Larger weep holes for easier cleaning, less clogging• AR 200 steel head decreases wear, extends life



Redesigned Head Impeller


CNG Integration Innovation


S-Series Mixer CNG Integration Twin tank design – 76 DGE

capacity Vertical tank configuration

• Improves mounting footprint• Less option content sacrifice• Weight reduction vs. four

tank design Reduction in plumbing

complexity and potentialleak points

New Cummins ISX-G 11.9L engine



Con-E-Co - New Product Innovation


Launching at ConExpoMobile Twin Shaft Mixer Low mixer charging elevation Generous 12ft 8in minimum

discharge height Unique 42-inch wide conveyor

belt design Easy installation, high productivity Retrofit on a wide range of plants

LO-PRO 327D Batch Plant Self-erecting, self-leveling Set-up time, labor and material

costs significantly reduced Large capacity (16 Yd3) aggregate

weighing bins Low 10ft 7in charging height


London Machinery – Canada’s Concrete Mixer LeaderNew Concrete Mixer Innovation CANbus mixer controls New lift hopper lock Plastic water tank with air pump Concrete ball breaker


Drum Replacement and Mixer Refurbishment Replace and refurbish

• Drum• Hopper, chute, collector and superstructure• Drum rollers• Hydraulic systems• Upgrade to new options


Drivers of Oshkosh’s Business Transformation


MOVE Investments Providing Returns Recovering demand for

non-defense businesses in North America• Europe looking stronger Additional cost take-out

• Focus on product, process and overhead costs

• Dedicated teams leveraging the Oshkosh Operating System

Innovations improving customers’ performance at work Yr/yr international sales

growth

24March 5, 20142014 AEM Investor Conference


Powering Our Transformation –The Oshkosh Operating System Customer-centric application

of lean principles• Develops talent to deliver value

for customers

Improves processes needed todeliver key elements of MOVE

Supports drive to improve cash flow

Implementation gaining momentum

Company-wide foundation for building shareholder value



Customer Supporting Systems

26

Leaders Cascade Training

Driving Our Customer-Centric Culture -OOS Foundational Training

Customer Satisfaction

Launched September 2013

Launched December 2013

Customer First

Launched November 2012



Transforming Operations –Continuous Improvement Events


Using Problem Solving Tools to Improve Paint Quality

Developing Customer-Centric Key Performance Indicators

Using Process Mapping to Reduce Lead Time

Improving Station Layout to Reduce Non-Value Added Motion


Continue to Advance OOS Culture

282014 AEM Investor Conference

The OOS Journey

Phase Zero:Exploration

Phase One:Building the foundation

Phase Two:Expanding with tools and deeper thinking

Phase Three:Integration and reinforcement

Phase Four:Building the momentum

March 5, 2014


29

Transforming Operations –Customer First, Customer Focused



Our Commitment to Shareholders Continue executing MOVE to drive shareholder value

• Impressive FY13 results, strong start to FY14 in Q1• Benefiting from improved housing starts; expect follow on growth

in non-residential construction and municipal recovery• MOVE initiatives driving margin expansion• On track to achieve FY15 EPS of $4.00 to $4.50

Oshkosh Operating System developing processes and talent to sustain superior growth for shareholders

30

Transforming to Sustain Long-Term Value Creation for Shareholders



For informationcontact:

Patrick N. DavidsonVice President, Investor Relations(920) [email protected]

Jeffrey D. WattDirector, Investor Relations(920) [email protected]


Appendix: Non-GAAP to GAAP Reconciliation

March 5, 2014 322014 AEM Investor Conference

The table below presents a reconciliation of the Company’s presented non-GAAP measures to the most directly comparable GAAP measures (in millions):

2013

Non-GAAP operating income-Access Equipment 388.6$ Impairment charge (9.0)

GAAP operating income-Access Equipment 379.6$

Fiscal Year EndedSeptember 30,


Appendix: Commonly Used Acronyms


ARFF Aircraft Rescue and Firefighting M-ATV MRAP All-Terrain VehicleAWP Aerial Work Platform MECV Modernized Expanded Capability VehicleCapEx Capital Expenditures MRAP Mine Resistant Ambush ProtectedCNG Compressed Natural Gas MSVS Medium Support Vehicle System (Canada)DGE Diesel Gallon Equivalent NOL Net Operating LossDoD Department of Defense NPD New Product Development

EAME Europe, Africa & Middle East NRC National Rental Company

EMD Engineering & Manufacturing Development OI Operating IncomeEPS Diluted Earnings Per Share OOS Oshkosh Operating SystemFHTV Family of Heavy Tactical Vehicles PLS Palletized Load SystemFMS Foreign Military Sales PUC Pierce Ultimate ConfigurationFMTV Family of Medium Tactical Vehicles R&D Research & DevelopmentHEMTT Heavy Expanded Mobility Tactical Truck RCV Refuse Collection VehicleHET Heavy Equipment Transporter RFP Request for ProposalHMMWV High Mobility Multi-Purpose Wheeled Vehicle ROW Rest of WorldIRC Independent Rental Company SMP Standard Military Pattern (Canadian MSVS)

IT Information Technology TACOM Tank-automotive and Armaments Command

JLTV Joint Light Tactical Vehicle TDP Technical Data PackageJPO Joint Program Office TPV Tactical Protector VehicleJROC Joint Requirements Oversight Council TWV Tactical Wheeled VehicleJUONS Joint Urgent Operational Needs Statement UCA Undefinitized Contract Action

L-ATV Light Combat Tactical All-Terrain Vehicle UIK Underbody Improvement Kit (for M-ATV)

LVSR Logistic Vehicle System Replacement

oshkosh corporation (nyse:osk)...2014/02/28 · 1850sj ultra boom industry’s largest work...

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