SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
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Date of Report
(Date of earliest
event reported): October 25, 1999
Oshkosh Truck Corporation
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(Exact name of registrant as specified in its charter)
Wisconsin 1-13886 39-0520270
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
P.O. Box 2566, Oshkosh, Wisconsin 54903
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(Address of principal executive offices, including zip code)
(920) 235-9151
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(Registrant's telephone number)
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Item 5. Other Events.
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On October 25, 1999, Oshkosh Truck Corporation (the "Company") issued
a press release announcing its earnings for the fourth quarter and the fiscal
year ended September 30, 1999. A copy of such press release is filed as Exhibit
99.1 and is incorporated by reference herein.
The Company also announced backlog was up $109.1 million, or 29%, to
$486.5 million at September 30, 1999 compared to the same period in the prior
year. The commercial segment backlog was up 47.6% and the fire and emergency
segment backlog was up 7.0%, in each case compared to units at September 30,
1998. The defense segment backlog was up 48.0% to $163.8 million compared to the
amount at September 30, 1998.
Item 7. Financial Statements and Exhibits.
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(a) Not applicable.
(b) Not applicable.
(c) Exhibits. The following exhibit is being filed herewith:
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(99.1) Oshkosh Truck Corporation Press Release dated October 25,
1999.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
OSHKOSH TRUCK CORPORATION
Date: October 25, 1999 By:/s/ Charles L. Szews
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Charles L. Szews
Executive Vice President and Chief
Financial Officer
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OSHKOSH TRUCK CORPORATION
Exhibit Index to Current Report on Form 8-K
Dated October 25, 1999
Exhibit
Number
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(99.1) Oshkosh Truck Corporation Press Release dated October 25, 1999.
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FOR IMMEDIATE RELEASE
For more information, contact:
Financial: Charles L. Szews
Executive Vice President and
Chief Financial Officer
(920) 235-9151, Ext. 2332
Media: Kirsten Skyba
Director, Corporate Marketing and
Communications
(920) 233-9621
OSHKOSH TRUCK REPORTS RECORD NET INCOME FOR FISCAL 1999;
104 PERCENT INCREASE IN FOURTH QUARTER
OSHKOSH, WIS., October 25, 1999 - Oshkosh Truck Corporation (NASDAQ - OTRKB), a
leading manufacturer of specialty trucks and truck bodies, today reported that
net income increased 104 percent to $10.1 million, or $0.77 per share, for the
fourth quarter of fiscal 1999 on sales of $314 million. This compares to net
income of $5.0 million, or $0.39 per share, for the fourth quarter of fiscal
1998 on sales of $243 million.
Net sales for the quarter increased 29 percent. Operating income increased
55 percent to $23.0 million, or 7.3 percent of sales, compared to $14.8 million,
or 6.1 percent of sales, in the prior year. Sales and income growth continued to
be led by the commercial segment, the largest of the company's three business
segments.
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Commenting on fiscal 1999 performance, Robert G. Bohn, president and chief
executive officer, noted, "Oshkosh Truck's powerful organic earnings momentum
was fueled by across-the-board market share gains in rear-discharge mixers,
refuse bodies, fire and emergency apparatus, and most dramatically in
front-discharge concrete trucks. In the first full year since the McNeilus
acquisition, our combined sales force and product development teams have
generated remarkable sales growth in the construction and refuse markets."
Factors affecting fourth quarter results for the company's business
segments included:
Commercial segment--Fourth quarter sales increased $48.4 million, or 50
percent, to $145.7 million for the quarter due to strong performance in both the
construction and refuse markets. Construction sales were up 57 percent and
refuse sales were up 35 percent for the quarter.
Operating income increased $8.3 million, or 146 percent, to $14.0 million,
or 9.6 percent of sales, compared to prior year operating income of $5.7
million, or 5.8 percent of sales. Strong customer demand during the quarter in
what is normally a seasonally slower period for the construction market,
contributed to the commercial segment's strong performance.
Defense--Sales increased by 25 percent to $75.5 million for the quarter.
Operating income for the defense segment increased $1.0 million to $7.9 million,
or 10.5 percent of sales, for the fourth quarter compared to $6.9 million, or
11.5 percent of sales, for the same quarter in fiscal 1998.
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Earlier this year the company initiated work on its Medium Tactical Truck
Replacement contract for the U.S. Marine Corps. This five-year contract was
awarded to Oshkosh in December 1998 and has a potential value of more than $1.2
billion, from fiscal 2000 through fiscal 2005, if all options are exercised. The
company expects to begin to recognize sales related to this contract in fiscal
2000. Manufacturing of the first ten units has already begun and testing of
these units is scheduled to begin in December 1999.
Fire and Emergency--Sales increased $7.1 million, or 8 percent, to $93.1
million for the fourth quarter. Operating income declined 18 percent to $6.9
million for the quarter. The decline in operating income is primarily attributed
to short-term production inefficiencies following the installation of the final
modules of a new enterprise-wide resource planning system during the third
quarter at the company's Pierce Manufacturing Inc. ("Pierce") subsidiary. By the
end of September, Pierce had significantly reduced those production
inefficiencies. Management believes that any lingering effects from the system
conversion will be substantially resolved by the end of the first quarter of
fiscal 2000.
Corporate and other--Operating expenses were $5.8 million for the quarter
compared to $6.2 million in the prior year. Net interest expense for the quarter
increased to $6.8 million compared to $6.4 million in the prior year quarter as
a result of increased working capital requirements to support the increased
level of sales. In September 1999, the company made scheduled and early term
debt repayments of $3.2 million and $15.8 million, respectively.
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Full Year Results
The company reported that net income increased 107 percent to $31.1
million, or $2.39 per share, for the year on sales of $1,165 million compared to
$15.1 million, or $1.18 per share, for fiscal 1998, on sales of $903 million in
the prior year. Operating income rose 56 percent to $76.2 million, or 6.5
percent of sales, compared to $48.7 million, or 5.4 percent of sales, in fiscal
1998.
Factors affecting fiscal 1999 results for the company's business segments
included:
Commercial--Sales increased 72 percent to $608 million compared to $354
million in the prior year. Construction sales were up 57 percent and refuse
sales were up 130 percent for the year. Sales and operating results include
McNeilus for 12 months in fiscal 1999 compared to only 7 months in fiscal 1998
as McNeilus was acquired in February 1998. Year on year sales of McNeilus were
up 27 percent to $479 million.
Defense--Sales decreased $25 million, or 10 percent, to $223 million
compared to $248 million in fiscal 1998. The company had previously reported
that sales for the year would be down by up to $30 million as a result of the
completion of the ISO-compatible palletized flatrack contract in the fourth
quarter of fiscal 1998. Operating income was flat for the year at $22.9 million,
or 10.3 percent of sales, compared to $22.7 million, or 9.1 percent of sales, in
the prior year. Operating income was positively impacted by increased parts
sales which typically carry higher overall margins.
Fire and Emergency--Sales increased 12 percent to $336 million compared
to $301 million in fiscal 1998. Operating income increased 4.6 percent to $26.8
million, or 8.0 percent of sales, compared to $25.6 million, or 8.5 percent of
sales, in the prior year.
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Production inefficiencies arising from the installation of an enterprise-wide
resource planning system contributed to slower operating income growth in fiscal
1999.
Corporate and other--Corporate expense increased $3.6 million to $22.4
million due to a litigation settlement in 1999. Net interest expense increased
$5.8 million to $26.0 million. Results include 12 months of interest on McNeilus
acquisition debt compared to 7 months in 1998.
Dividend Announcement
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Oshkosh Truck Corporation's Board of Directors declared a quarterly
dividend of $0.07500 per share for Class A Common Stock and $0.08625 per share
for Common Stock. These dividends, up 3.5 percent, will be payable November 15,
1999, to shareholders of record as of November 8, 1999.
Oshkosh Truck Corporation is a leading designer, manufacturer and marketer
of a broad range of specialty commercial, fire and emergency and military trucks
and truck bodies under the Oshkosh, McNeilus and Pierce brand names. Oshkosh's
products are valued worldwide by fire and emergency units, defense forces,
municipal and airport support services, construction and refuse businesses where
high quality, superior performance, rugged reliability, and long-term value are
paramount.
Forward-Looking Statements
This press release contains statements that the company believes are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. All statements other than statements of
historical fact, including statements
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regarding the company's future financial position, business strategy, budgets,
projected costs and plans and objectives of management for future operations,
are forward-looking statements. When used in this press release, words such as
the company "expects," "intends," "estimates," "anticipates" or "believes" and
similar expressions are generally intended to identify forward-looking
statements. These forward-looking statements are not guarantees of future
performance and are subject to risks, uncertainties and other factors, some of
which are beyond the company's control, that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements. These factors include the consequences of financial leverage, the
cyclical nature of the company's commercial markets, risks related to reductions
in government expenditures, the uncertainty of government contracts and the
challenges of identifying acquisition candidates and integrating acquired
businesses. Additional information concerning these and other factors is
contained in the company's filings with the Securities and Exchange Commission.
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OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<CAPTION>
Three Months Ended Year Ended
September 30, September 30,
-------------------------------- ------------------------------------
1999 1998 1999 1998
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(In thousands, except per share amounts)
<S> <C> <C> <C> <C>
Net sales $ 313,906 $ 243,051 $ 1,164,954 $ 902,792
Cost of sales 265,445 204,126 991,573 776,756
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Gross income 48,461 38,925 173,381 126,036
Operating expenses:
Selling, general and administrative 22,674 21,336 85,996 69,001
Amortization of goodwill and other
intangibles 2,772 2,756 11,172 8,315
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Total operating expenses 25,446 24,092 97,168 77,316
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Operating income 23,015 14,833 76,213 48,720
Other income (expense):
Interest expense (6,905) (7,217) (26,744) (21,490)
Interest income 146 782 760 1,326
Miscellaneous, net 166 436 730 92
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(6,593) (5,999) (25,254) (20,072)
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Income from operations before income taxes,
equity in earnings of unconsolidated
partnership and extraordinary item 16,422 8,834 50,959 28,648
Provision for income taxes 6,613 4,277 21,313 12,655
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9,809 4,557 29,646 15,993
Equity in earnings of unconsolidated
partnership, net of income taxes 376 395 1,545 260
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Income from operations 10,185 4,952 31,191 16,253
Extraordinary charge for early retirement of
debt, net of income tax benefit (60) - (60) (1,185)
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Net income $ 10,125 $ 4,952 $ 31,131 $ 15,068
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Earnings per share $ 0.79 $ 0.39 $ 2.45 $ 1.20
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Earnings per share assuming dilution $ 0.77 $ 0.39 $ 2.39 $ 1.18
=============== =============== ================ ==================
Weighted average shares outstanding:
Basic 12,810 12,630 12,727 12,598
Assuming dilution 13,170 12,836 13,052 12,759
Cash dividends:
Class A Common Stock $ 0.07500 $ 0.07250 $ 0.29250 $ 0.29000
Common Stock $ 0.08625 $ 0.08333 $ 0.33625 $ 0.33333
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OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
Sept. 30, Sept. 30,
1999 1998
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(Unaudited)
(In thousands)
ASSETS
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 5,137 $ 3,622
Receivables, net 93,186 80,982
Inventories 198,446 149,191
Prepaid expenses 4,963 3,768
Deferred income taxes 14,558 12,281
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Total current assets 316,290 249,844
Investment in unconsolidated partnership 12,335 13,496
Other long-term assets 20,853 14,198
Property, plant and equipment 154,597 156,783
Less accumulated depreciation (70,606) (75,947)
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Net property, plant and equipment 83,991 80,836
Goodwill and other intangible assets, net 319,821 326,665
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Total assets $ 753,290 $ 685,039
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 84,727 $ 65,171
Floor plan notes payable 26,616 11,645
Customer advances 68,364 44,915
Payroll-related obligations 24,734 24,124
Accrued warranty 14,623 15,887
Other current liabilities 48,462 43,498
Current maturities of long-term debt and revolving
credit facility 18,759 3,467
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Total current liabilities 286,285 208,707
Long-term debt 241,789 277,337
Deferred income taxes 44,265 47,832
Other long-term liabilities 18,071 19,867
Shareholders' equity 162,880 131,296
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Total liabilities and shareholders' equity $ 753,290 $ 685,039
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OSHKOSH TRUCK CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Year Ended
September 30,
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1999 1998
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(Unaudited)
(In thousands)
Operating activities:
<S> <C> <C>
Income from operations $ 31,191 $ 16,253
Non-cash adjustments 17,353 20,844
Changes in operating assets and liabilities (9,496) 42,844
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Net cash provided from operating activities 39,048 79,941
Investing activities:
Acquisition of businesses, net of cash acquired - (221,144)
Additions to property, plant and equipment (13,139) (8,555)
Proceeds from sale of affiliate - 3,375
Proceeds from sale of property, plant and equipment 158 1,524
Increase in other long-term assets (1,503) (3,817)
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Net cash used for investing activities (14,484) (228,617)
Net cash used for discontinued operations - (1,093)
Financing activities:
Net borrowings (repayments) under revolving credit facility (1,000) 6,000
Proceeds from issuance of long-term debt - 325,000
Repayments of long-term debt (19,256) (188,049)
Debt issuance costs - (8,641)
Dividends paid (4,226) (4,176)
Other 1,433 38
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Net cash provided from (used for) financing activities (23,049) 130,172
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Increase (decrease) in cash and cash equivalents 1,515 (19,597)
Cash and cash equivalents at beginning of period 3,622 23,219
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Cash and cash equivalents at end of period $ 5,137 $ 3,622
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Supplementary disclosure:
Depreciation and amortization $ 23,157 $ 18,698
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OSHKOSH TRUCK CORPORATION
SEGMENT INFORMATION
<CAPTION>
Three Months Ended Year Ended
September 30, September 30,
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1999 1998 1999 1998
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(Unaudited) (Unaudited)
(In thousands)
Net sales:
<S> <C> <C> <C> <C>
Fire and Emergency $ 93,146 $ 86,015 $ 336,241 $ 301,181
Defense 75,543 60,233 222,535 247,956
Commercial 145,717 97,313 607,678 354,165
Corporate and other (500) (510) (1,500) (510)
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Total net sales $ 313,906 $ 243,051 $ 1,164,954 $ 902,792
================== ================== ===================== ==================
Operating income:
Fire and Emergency $ 6,914 $ 8,452 $ 26,758 $ 25,581
Defense 7,921 6,938 22,878 22,680
Commercial 13,968 5,680 48,995 19,317
Corporate and other (5,788) (6,237) (22,418) (18,858)
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Total operating income $ 23,015 $ 14,833 $ 76,213 $ 48,720
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