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OSHKOSH, Wis.--([ BUSINESS WIRE ])--Oshkosh Corporation (NYSE: OSK) today reported fiscal 2012 second quarter net income attributable to Oshkosh Corporation of $37.3million, or $0.41 per diluted share, compared to $67.9million, or $0.74 per diluted share, in the second quarter of fiscal 2011. Results for the second quarter of fiscal 2012 included after-tax charges of $0.02 per diluted share related to the proxy contest in connection with the Companyas 2012 annual shareholdersa meeting and $0.02 per diluted share related to the Companyas exit from its U.S. mobile medical trailer product line and workforce reductions at Pierce.

"Strong performance by our access equipment segment drove quarterly results above our expectations"

Consolidated net sales in the second quarter of fiscal 2012 were $2.08billion, an increase of 18.9percent compared to the prior year second quarter. Increased replacement driven demand for aerial work platforms and telehandlers in the access equipment segment and higher defense segment Family of Medium Tactical Vehicles (FMTV) sales were offset in part by the expected decline in sales of Family of Heavy Tactical Vehicles (FHTV) and aftermarket parts, also in the defense segment.

Consolidated operating income in the second quarter of fiscal 2012 was $75.9million, or 3.7percent of sales, compared to $132.4million, or 7.6percent of sales, in the prior year second quarter. Increased earnings on higher access equipment segment sales were more than offset by lower defense segment earnings that resulted from an adverse product mix.

aStrong performance by our access equipment segment drove quarterly results above our expectations," said Charles L. Szews, Oshkosh Corporation president and chief executive officer. aWe believe customer actions and industry metrics point to a sustained recovery in global access equipment markets. Our success in responding to this recovery enables us to raise our performance outlook for the full fiscal year 2012.a

aWe expect the execution of our MOVE strategy in fiscal 2012 will lead to a strong improvement in our Companyas earnings in fiscal 2013. During the second quarter, we continued to take steps toward optimizing the cost structures of our businesses. In our fire & emergency segment, we exited the U.S. mobile medical trailer product line, restructured our workforce at Pierce and made solid progress integrating multiple product lines in our Florida operations. In our commercial segment, we reconfigured our refuse collection vehicle production lines to improve production efficiencies and closed a fabrication facility. In the defense segment, we continued to reduce our costs on the FMTV contract. And, we launched innovative new products like our Rental Series scissor lifts to address cost conscious segments of the access equipment market,a said Szews.

Factors affecting second quarter results for the Companyas business segments included:

Access Equipmenta" Access equipment segment sales increased 61.4percent to $760.4million for the second quarter of fiscal 2012 compared to the prior year second quarter principally as a result of higher unit volumes and the realization of previously announced price increases. Sales grew by double-digit percentages compared to the prior year quarter in all major regions of the globe, with the largest increase in North America driven largely by replacement of aged equipment.

In the second quarter of fiscal 2012, access equipment segment operating income increased 285.3percent to $68.4million, or 9.0percent of sales, compared to prior year second quarter operating income of $17.7million, or 3.8percent of sales. The increase in operating results reflected higher volume, the realization of previously announced price increases, improved product mix and improved absorption related to higher sales volume, offset in part by higher raw material costs and higher new product development spending.

Defensea" Defense segment sales increased 1.5percent to $987.3million for the second quarter of fiscal 2012 compared with the prior year second quarter. The increase was primarily due to higher FMTV unit sales, offset by lower FHTV unit sales and lower aftermarket parts sales.

In the second quarter of fiscal 2012, defense segment operating income decreased 70.4percent to $41.9million, or 4.2percent of sales, compared to prior year second quarter operating income of $141.6million, or 14.6percent of sales. The decrease in operating income was largely due to adverse changes in the product mix. Benefits from revenue and cost estimate changes of $15.2million recognized in the second quarter of fiscal 2011 on undefinitized MRAP All-Terrain Vehicle (M-ATV) change orders also negatively impacted comparisons to the prior year period. The Company recorded higher profit margins on the FMTV program during the second quarter compared to the first quarter of fiscal 2012, although the profit margins remained in the low single digits.

Fire & Emergencya" Fire & emergency segment sales for the second quarter of fiscal 2012 increased 2.4percent from the prior year quarter to $181.5million. The increase in sales primarily reflected increased intersegment production for the defense segment.

The fire & emergency segment reported an operating loss of $11.3million, or 6.2percent of sales, for the second quarter of fiscal 2012 compared to an operating loss of $6.6million, or 3.7percent of sales, in the prior year quarter. Operating results for the second quarter of fiscal 2012 included charges and severance costs totaling $2.4million related to exiting the U.S. mobile medical trailer product line and workforce reductions at Pierce, as well as $2.6million of litigation and environmental remediation charges. Operating results during the second quarter of fiscal 2012 continued to be negatively impacted by inefficiencies related to the transition of ambulance production to the Companyas facilities in Florida following factory consolidations in fiscal 2011.

Commercial a" Commercial segment sales increased 10.6percent to $167.7million in the second quarter of fiscal 2012 compared to the prior year quarter. The increase in sales was primarily attributable to increased demand for aftermarket parts & service, increased concrete placement vehicle demand over very low prior year volumes and higher refuse collection vehicle demand, offset in part by lower intersegment production for the defense segment.

The commercial segment reported operating income of $3.9million, or 2.3percent of sales, for the second quarter of fiscal 2012 compared to $5.3million, or 3.5percent of sales, in the prior year quarter. The decrease in operating income primarily resulted from weaker overhead absorption on lower production volumes and higher personnel costs largely due to the elimination of employee furloughs, offset in part by earnings on the higher sales volume.

Corporate a" Corporate operating expenses increased $1.5million to $27.0million for the second quarter of fiscal 2012 compared to the prior year quarter. Corporate operating expenses in the second quarter of fiscal 2012 included $3.6million of costs related to the proxy contest in connection with the Companyas 2012 annual shareholdersa meeting.

Interest Expense Net of Interest Incomea" Interest expense net of interest income decreased $3.1million to $17.6million in the second quarter of fiscal 2012 compared to the prior year quarter. The decrease was largely due to the expiration of the Companyas interest rate swap in December 2011. Second quarter fiscal 2011 interest expense included $3.0million of expense related to the Companyas interest rate swap. The Company repaid $32.5million of debt during the second quarter of fiscal 2012.

Provision for Income Taxesa" The Company recorded income tax expense of $21.6million in the second quarter of fiscal 2012, or 36.2percent of pre-tax income, compared to 39.5percent of pre-tax income in the prior year quarter. The second quarter fiscal 2011 effective tax rate was negatively impacted by the effect of unbenefitted losses in foreign tax jurisdictions.

Six-month Results

The Company reported net sales for the first six months of fiscal 2012 of $3.95billion and net income attributable to Oshkosh Corporation of $76.2million, or $0.83 per share. This compares with net sales of $3.45billion and net income attributable to Oshkosh Corporation of $167.5million, or $1.83 per share, in the first six months of the prior year. The decrease in net income attributable to Oshkosh Corporation was primarily attributable to changes in the defense segment where an adverse product mix negatively impacted operating income comparisons, offset in part by improved access equipment segment results.

Updated Fiscal 2012 Expectations

The Company is increasing its outlook for fiscal2012 primarily due to stronger than expected orders and sales in the access equipment segment in the second quarter of fiscal 2012. The Company now expects sales in the access equipment segment will be 35percent to 40percent higher in fiscal 2012 compared to fiscal 2011 with operating income margins of 7.5percent to 8.0percent in the segment. In addition, the Company has reduced expectations for the fire & emergency segmentas operating income to approximately breakeven as a result of second quarter results in this segment. The Company will discuss these changes and other changes to the Companyas fiscal 2012 outlook during a conference call later today.

Conference Call

The Company will comment on second quarter earnings during a conference call at 9:00 a.m. EDT this morning. Slides for the call will be available on the Companyas website beginning at 7:00 a.m. EDT this morning. The call will be webcast simultaneously over the Internet. To access the webcast, listeners can go to [ www.oshkoshcorporation.com ] at least 15 minutes prior to the event and follow instructions for listening to the broadcast. An audio replay of the call and related question and answer session will be available for 12 months at this website.

Forward-Looking Statements

This press release contains statements that the Company believes to be aforward-looking statementsa within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including, without limitation, statements regarding the Companyas 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, are forward-looking statements. When used in this press release, words such as amay,a awill,a aexpect,a aintend,a aestimate,a aanticipate,a abelieve,a ashould,a aprojecta or aplana 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 Companyas 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 Companyas access equipment, commercial and fire & emergency markets; the expected level and timing of the U.S. Department of Defense (DoD) procurement of products and services and funding thereof; risks related to reductions in government expenditures in light of U.S. defense budget pressures and an uncertain DoD tactical wheeled vehicle strategy; increasing commodity and other raw material costs, particularly in a sustained economic recovery; the ability to increase prices to offset higher input costs; risks related to facilities consolidation and alignment, including costs and charges thereof and that anticipated cost savings may not be achieved; the Companyas ability to produce vehicles under the FMTV contract at targeted margins; the duration of the ongoing global economic weakness, which could lead to additional impairment charges related to many of the Companyas intangible assets and/or a slower recovery in the Companyas cyclical businesses than Company or equity market expectations; the potential for the U.S. government to competitively bid the Companyas Army and Marine Corps contracts; the consequences of financial leverage, which could limit the Companyas ability to pursue various opportunities; 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 Companyas 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; risks related to actions of activist shareholders; and the Companyas 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 Companyas filings with the Securities and Exchange Commission, including the Form 8-K filed today. All forward-looking statements speak only as of the date of this press release. The Company assumes no obligation, and disclaims any obligation, to update information contained in this press release. Investors should be aware that the Company may not update such information until the Companyas next quarterly earnings conference call, if at all.

About Oshkosh Corporation

Oshkosh Corporation is a leading designer, manufacturer and marketer of a broad range of specialty access equipment, commercial, fire & emergency and military vehicles and vehicle bodies. Oshkosh Corporation manufactures, distributes and services products under the brands of Oshkosh, JLG, Pierce,McNeilus, Medtec, Jerr-Dan, Oshkosh Specialty Vehicles, Frontline^a", SMIT^a", CON-E-CO, London and IMT. Oshkosh products are valued worldwide in businesses where high quality, superior performance, rugged reliability and long-term value are paramount. For more information, log on to [ www.oshkoshcorporation.com ].

^{, TM} All brand names referred to in this news release are trademarks of Oshkosh Corporation or its subsidiary companies.