MOVING THE WORLD AT WORK - Oshkosh Corporation€¦ · EPS Diluted Earnings Per Share OOS Oshkosh Operating System FHTV Family of Heavy Tactical Vehicles PLS Palletized Load System

MOVING THE WORLD AT WORK

Oshkosh CorporationThird Quarter Fiscal 2014

July 29, 2014

Charles L. SzewsChief Executive Officer

Wilson R. JonesPresident and Chief Operating Officer

David M. SagehornExecutive Vice President and Chief Financial Officer

Patrick N. DavidsonVice President, Investor Relations


Forward-Looking StatementsThis 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, without limitation, 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, are forward-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, which are particularly impacted by the pace of 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 customer 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 uncertainDoD tactical wheeled vehicle strategy, including the Company’s ability to successfully manage the cost reductions required as a result of lower customer orders 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 inthe Company’s cyclical businesses than Company 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; the impact of severe weather or natural disasters that may affect the Company, its suppliers or its customers; the impact of cyber security risk and costs of defending against, mitigating and responding to a data security breach; 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 today. 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 suchinformation until the Company’s next quarterly earnings conference call, if at all.

July 29, 2014OSK Third Quarter 2014 Earnings Call 2


Q3 Performance Highlights

Adjusted EPS* of $1.23

Improved access equipment and commercial performance offset by expected lower defense results

Narrowing FY14 adjusted EPS* range to $3.40 to $3.55

Announced quarterly dividend of $0.15 per share

Net

Sal

es(b

illio

ns)

Adjusted EPS*

OSK Fiscal Q3 Performance

* Non-GAAP results. See Appendix for reconciliation to GAAP results.


$1.9

$2.2

$1.23

$1.67

$0.00

$0.25

$0.50

$0.75

$1.00

$1.25

$1.50

$1.75

$2.00

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

FY14 FY13Net Sales Adjusted EPS*


Positive Outlook

Non-defense markets improving, although not all at pace expected at 2012 Analyst Day Importantly, North American markets are strong

MOVE strategy, powered by the Oshkosh Operating System, is delivering Expected to continue contributing to margin expansion in

non-defense segments in 2015 and beyond

Continuing to pursue international defense opportunities



Defense

Completed workforce reduction to match lower production volume Scalable capacity to ramp-up for

potential new vehicle programs

JLTV activities Completed 200,000 RAM miles to

support EMD testing Participated in DoD’s production

draft RFP industry session

Work continues on multiple international opportunities



Access Equipment

Record quarterly sales and operating income In spite of EAME market at ~50%

of prior peak

Highest Q3 sales growth rates in EAME and Asia Solid demand continues in North

America Strong fleet metrics

Slowdown in Latin America Positive customer response to

recent new product launches


1850AJ at work


Fire & Emergency

Positive operational trends evidenced later in quarter Reflects MOVE benefits Expect continued improvement in

Q4 and into 2015

Multi-unit international deliveries expected in Q4 Slight pause in U.S. market

recovery Not expected to be a trend



Commercial Highest quarterly operating

income margin since 2007 North America concrete mixer

market still ~40% below normal

Expect slightly higher U.S. RCV sales in 2014 Remain focused on driving

improved segment results Expect greater benefits in

2015



Consolidated Results

Sales impacted by:

‒ Significantly lower defense volume

+ Access equipment and concrete mixer demand

EPS impacted by:

Lower defense sales

Prior year discrete tax benefits

+ Improved access equipment and commercial results

Comments

(Dollars in millions, except per share amounts)

Third Quarter

Net Sales $1,932.4 $2,204.4 % Change (12.3)% 2.1%

Adjusted Operating Income* $175.3 $225.6

% Change (22.3)% 78.8%% Margin 9.0% 10.2%

Adjusted EPS* $1.23 $1.67% Change (26.3)% 116.9%

2014 2013




Updated Expectations for FY14

Additional expectations Corporate expenses ~$10 million higher than

adjusted FY13* Tax rate* of ~32.0% CapEx of ~$100 million Free cash flow* ~$100 million Assumes share count of ~86.0 million

Segment information

Measure Access Equipment Defense Fire &

Emergency Commercial

Sales(billions) $3.40 - $3.425 $1.725 - $1.75 ~$0.775 ~$0.85

Operating Income Margin ~14.6% ~4.75%* ~3.5% ~6.0%

• Revenues of $6.7 billion to $6.75 billion• Adjusted operating income* of $490 million to $505 million• Adjusted EPS* of $3.40 to $3.55




For informationcontact:

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

Jeff WattDirector, Investor Relations(920) [email protected]


Net Sales $1,039.2 $941.5% Change 10.4%* 15.6%

Operating Income $166.8 $154.5% Change 8.0% 75.1%% Margin 16.0% 16.4%

Third Quarter

(Dollars in millions)

2014 2013

Appendix: Access Equipment

Sales impacted by: Higher volumes, particularly

EAME and North America Higher pricing Lower U.S. military telehandler

sales Operating Income impacted by:

Higher sales volume Cost reduction initiatives NPD spending Higher operating costs

Backlog down 21.6% vs. prior year to $487 million (down 19.3% excluding military telehandlers)

Comments


* 13.2% excluding military telehandlers. Non-GAAP results. See Appendix for reconciliation to GAAP results.


Appendix: Defense

Sales impacted by: Significantly lower volume due to

reduced U.S. defense spending Lower international M-ATV sales

Operating Income impacted by: Lower sales volume Prior year contract adjustments

Backlog down 53.4%vs. prior year to $880 million

Comments

Net Sales $470.7 $879.6% Change (46.5)% (8.2)%

Adjusted Operating Income* $20.1 $85.8

% Change (76.6)% 113.8%% Margin 4.2% 9.8%

Third Quarter


2014 2013




Net Sales $187.5 $204.3% Change (8.3)% (11.0)%

Operating Income $6.2 $6.5% Change (5.2)% (18.8)%% Margin 3.3% 3.2%

Third Quarter


2014 2013

Appendix: Fire & Emergency

Sales impacted by: Lower deliveries, mostly

international

Operating Income impacted by: Lower sales volume Lower operating expenses

Backlog up 6.9% vs. prior year to $538 million

Comments



Appendix: Commercial

Sales impacted by: Concrete mixer and RCV

volumes, supported in partby weather delayed shipments from Q2

Operating Income impacted by: Higher sales volume Improved production efficiencies Prior year restructuring-related

costs

Backlog up 23.6% vs. prior year to $207 million

Comments

Net Sales $247.3 $194.7% Change 27.0% 10.5%

Operating Income $19.9 $10.0% Change 98.6% (17.8)%% Margin 8.0% 5.1%

Third Quarter


2014 2013



Appendix: Commonly Used AcronymsARFF Aircraft Rescue and Firefighting MRAP Mine Resistant Ambush Protected

AWP Aerial Work Platform MSVS Medium Support Vehicle System (Canada)

CNG Compressed Natural Gas MTT Medium Tactical Truck

DoD Department of Defense NPD New Product Development

EAME Europe, Africa & Middle East OCO Overseas Contingency Operations

EMD Engineering & Manufacturing Development OI Operating Income

EPS Diluted Earnings Per Share OOS Oshkosh Operating System

FHTV Family of Heavy Tactical Vehicles PLS Palletized Load System

FMS Foreign Military Sales PUC Pierce Ultimate Configuration

FMTV Family of Medium Tactical Vehicles RAM Reliability, Availability & Maintainability

HEMTT Heavy Expanded Mobility Tactical Truck RCV Refuse Collection Vehicle

HET Heavy Equipment Transporter RFP Request for Proposal

HMMWV High Mobility Multi-Purpose Wheeled Vehicle ROW Rest of World

JLTV Joint Light Tactical Vehicle SMP Standard Military Pattern (Canadian MSVS)

JPO Joint Program Office TACOM Tank-automotive and Armaments Command

JROC Joint Requirements Oversight Council TDP Technical Data Package

JUONS Joint Urgent Operational Needs Statement TFFT Tactical Fire Fighting Truck

L-ATV Light Combat Tactical All-Terrain Vehicle TPV Tactical Protector Vehicle

LVSR Logistic Vehicle System Replacement TWV Tactical Wheeled Vehicle

M-ATV MRAP All-Terrain Vehicle UCA Undefinitized Contract Action

MECV Modernized Expanded Capability Vehicle UIK Underbody Improvement Kit (for M-ATV)



Appendix: Non-GAAP to GAAP Reconciliation

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


2014 2013

Access equipment segment sales excluding military (non-GAAP) 1,039.2$ 917.8$ Military telehandler sales - 23.7 Access equipment segment sales (GAAP) 1,039.2$ 941.5$

Adjusted defense segment sales (non-GAAP) 481.4$ 879.6$ Contract pricing adjustment for OPEB costs (10.7) - Defense segment sales (GAAP) 470.7$ 879.6$

Adjusted defense segment operating income (non-GAAP) 20.1$ 85.8$ Contract pricing adjustment for OPEB costs (10.7) - OPEB curtailment gain 9.7 - Defense segment operating income (GAAP) 19.1$ 85.8$

Adjusted net sales (non-GAAP) 1,943.1$ 2,204.4$ Contract pricing adjustment for OPEB costs (10.7) - Net sales (GAAP) 1,932.4$ 2,204.4$

Adjusted operating income (non-GAAP) 175.3$ 225.6$ Contract pricing adjustment for OPEB costs (10.7) - OPEB curtailment gain 9.7 - Operating income (GAAP) 174.3$ 225.6$

Three Months EndedJune 30,



• The tables below present a reconciliation of the Company’s presented non-GAAP measures to the most directly comparable GAAP measures (in millions, except per share amounts):


2014 2013

Adjusted earnings per share from continuing operations-diluted (non-GAAP) 1.23$ 1.67$ Contract pricing adjustment for OPEB costs, net of tax (0.08) - OPEB curtailment gain, net of tax 0.07 - Earnings per share from continuing operations-diluted (non-GAAP) 1.22$ 1.67$

Three Months EndedJune 30,



• The tables below present a reconciliation of the Company’s presented non-GAAP measures to the most directly comparable GAAP measures (in millions, except per share amounts):


Low High

Adjusted operating income (non-GAAP) 490.0$ 505.0$ Contract pricing adjustment for OPEB costs (10.7) (10.7) OPEB curtailment gain 9.7 9.7 Pension curtailment loss (4.1) (4.1) Operating income (GAAP) 484.9$ 499.9$

Adjusted earnings per share from continuing operations-diluted (non-GAAP) 3.40$ 3.55$ Reduction of valuation allowance on net operating loss carryforward 0.14 0.14Contract pricing adjustment for OPEB costs, net of tax (0.08) (0.08)OPEB curtailment gain, net of tax 0.07 0.07Pension curtailment loss, net of tax (0.03) (0.03)Debt extinguishment costs, net of tax (0.08) (0.08)Earnings per share from continuing operations-diluted (GAAP) 3.42$ 3.57$

Adjusted operating expenses-Corporate (non-GAAP) (147.6)$ Tender offer and proxy contest costs (16.3) Operating expenses-Corporate (GAAP) (163.9)$

Fiscal Year EndedSeptember 30, 2013

Fiscal 2014 Expectations



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


Fiscal 2014Expectations

Net cash flows provided by operating activities 213.0$ Additions to property, plant and equipment (100.0) Additions to equipment held for rental (19.0) Proceeds from sale of equipment held for rental 6.0 Free cash flow 100.0$

Effective tax rate (non-GAAP) 32.0%Reduction of valuation allowance on net operating loss carryforward (3.0)%Effective tax rate (GAAP) 29.0%

Defense adjusted operating income margin (non-GAAP) 4.75%Contract pricing adjustment for OPEB costs (0.62)%OPEB curtailment gain 0.56%Pension curtailment loss (0.24)%Defense operating income margin (GAAP) 4.45%

Documents

MOVING THE WORLD AT WORK - Oshkosh Corporation€¦ · EPS Diluted Earnings Per Share OOS Oshkosh Operating System FHTV Family of Heavy Tactical Vehicles PLS Palletized Load System