Oshkosh (OSK) 28 Oct 212021 Q4 Earnings call transcript

Greetings, welcome to the Oshkosh Corporation reports Fiscal 2021 Fourth Quarter and Full Year Results. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. I will now turn the conference over to Pat Davidson, Senior Vice President of Investor Relations for Oshkosh Corporation. Mr. you, Thank Davidson.

begin. You may

Today's slide and available our a use published thanks of Earlier and morning, slide at is joining release call is webcast our accompanied to by financial website. audio of approximately Please for fourth quarter GAAP we a The oshkoshcorp.com. website our this our copy XX which non-GAAP be that available today, measures slide refer is during XXXX that presentation replay being is for website and includes Good presentation, now on and us. call reconciliation available on results. the two we on will presentation. will months. also of to A

contain obligation Our the remarks statements could risks to These others, risks be quarterly with Form or this update until matters our have in forward-looking the described with conference statements disclaim filed different earnings forward-looking statements not if be our cause of believe meaning forward-looking by X-K to and among from results such those These that We Litigation within any SEC. forward-looking call, filings these we morning include, the to statements which that make all. follow, may we statements. next to we including Reform questions, updated that SEC Private actual your that at Securities the subject Act. implied materially are answers be expressed to

will should better will full This be calendar customers aligned January fiscal period the quarter will of us fiscal we to XXXX The of those cycles to an planning year. our October XXXX, abbreviated the October As year, and Xth, we are business visibility our with year our transition provide year changing on to many our highlighted in and on Stub update XXXX. begin reporting suppliers. our first December with facilitate or to represent which X, as calendar change

references or on or XXXX all quarter year year. quarter result, a quarter year otherwise. a in to or as later year, or a a All to fiscal to or stated this calendar two, As fiscal or call or a before, unless a years XXXX to references

Chief John Vice Pack, Mike include President Officer. Pfeifer, and Financial today and and it you, President to Please slide and presenters over Executive John. Chief Officer; Our Executive I'll turn to three turn

and Pat morning, you, good Thank everyone.

As inefficiencies. robust our in that We current are believe challenges labor and business. discuss These we our to the clear of also more full want limiting market-leading these stronger, environment company results, for logistics position provide for significant It's the business a are period environments availability challenging we material same quarter facing view production factors we're contributing and as time, costs from current At resilient our the fourth and as while customer year a inflation. we demand the emerge I facing in workforce most temporary, as products, we're taking and manufacturing, to to color actions success right some supply environment. with time one decades. unique we of chain, on global the

to drive higher suppliers to and include accept inflation, cost products examples with to hundreds availability, supply components. identify of our in existing facilities labor redesigning JLG months which we're increases risk qualifying robust key align new production in more many shifting to better segments undertaking of our implementing chain and and process a rigorous our for Some by the actions in quantities to a capability reduce engage shortages, within chip our of last multiple to non-defense mitigate the produced are microprocessors, of several price higher makers materials

sales update. double-digit modest earnings increase Emergency leadership. driven With & The effective approved announce that from our which $X.XX, also with quarter share to products, rate. segments. I'm on discuss. led consecutive long-term $X.XX, This responsible lower wins slightly strategic in our of and Access $X.XX of to our our continue year a tax XX% to new comprehensive increase adjusted to we growth we business continued the which fourth pleased quarterly in a Fire range to revenues a XX.X% capital per backdrop, of our October Mike dividend included Xth was program that and Defense innovative above eighth Equipment, fundamentals, in strong market will percentage by this offering Board allocation the share estimated market increases. reported outlook attractive is Our repurchases will based increased represents higher commitment in on quarter, And drive the

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revenue to on over the based strong grow opportunity next innovative and few years we products drivers. our market an EPS Importantly, and have

our We strong programs significant the year foundation our United significant and U.S. Medium Caliber was Army's program including by Service segment System. bolstered wins Delivery reason also of States a XXXX in Weapons Vehicle, have the announcements Postal company. a a of electrification Defense Next for Generation

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with and I Defense slide are forward rotating family We a to our additional discussing quarters. products industry-leading partner I'll with our coming to the line review new expanding with segment. Italian Please telehandler Dieci. telehandlers U.S. you our in six turn new look also of

revenue an a fourth billion, in delivered margin operating an very Our supply of this XX% a Defense of increase team nearly challenging solid full leading $X.XX and environment. quarter almost X% of to chain year

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win We for are contract. recompete to and XXXX we believe the well-positioned follow-on are the upcoming also preparing in scheduled

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finalize the the with work to vehicles continue customer We to some parameters. of

on vehicles XXXX. contract This is up facility its product and South also and to emission mix new zero efficient XX,XXX with vehicles successful are our between back both vehicles launch ICE battery setting in a fleet. a allows of USPS XX-year electric in for track of We electrify expect call the the and with fuel XXX,XXX a Carolina and half

year-end income year the segment. for segment team Emergency that an operating Even impressive booked we despite the income orders of margin extreme which to municipal remains & delivered slide supply Emergency all-time The and for with and XX% an full another market discussion at & quarter, the Fire backlog. Let's of more last is seven to our F&E turn environment encouraged chain our operating The led by at Fire delivered margin inflation. strong year, a record fact challenging a we're strong XX.X%. cost record for record the

disruptions We this result near about chain the are of Stub during tempered in our we've for period term a talked supply call. as outlook

we of long-term and growth. planning our to will Of support these time, Appleton are expect manufacturing that course, an hurdles we site overcome expansion in

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comments my to the Boise Boise out on welcome I Equipment in As wildland I the want to is family. close Pierce's firefighting F&E, industry-leader Mobile trucks.

segment Boise Commercial investment will into eight minority segment. this talk Pierce in the delivered solid Similar Our of to results and advantage slide our and network to growing our and Commercial of both bring other about product segments, market. XXXX. we'll the allow to turn our Boise take dealer Please

the accomplishment past adjusted chain fact, year difficult That’s with the team years. full in in best In XX cost. this supply steel income record posted high operating its margins environment, an impressive

rear additional elevated much have a as ages months for and As will risk our either mixers the a many outlook solid by fleet This are well as represents of RCVs RCVs of of complete demand our package it build and mixers for has the expect to and XXXX. worsened over purchased our customers by Demand creating discharge you us we a a and chassis are couple markets. we construction other positive concrete body availability are for and for and in on construction Residential customers. aware, the with indicators meaningful third-party strong supply customer remain furnished or as past has replacement. challenge chassis we been both

orders of $XXX is period. just outlook quarter and the under XXXX. as expectations both orders by going good supported to turn providing it led to the moved Canada to million, Mike pandemic. and and the These our over high further I'm mixers for Stub RCVs Our discuss for into visibility results backlog fourth solid quarter the beyond to all-time an U.S. in

Thanks, John slide everyone. to and good Please turn nine. morning,

chain fourth in experience in third John faced and beyond quarter, quarter. logistics As highlighted, well significant the we disruptions our supply the

our price contributed Recall financial the The meaningful constraints quarter cost last-in, inventory at headwind approximately impact than in price account Access increased impacted year-over-year escalation the lower saw fourth cost that experienced additional for in so we year the inflation. offset a previously We discussed the million. than results consolidated increase the higher at quarter Equipment, XX% fourth chain cost market increase in Supply due quarter million increase X% by price basis, labor led partially Fire price purchases and to and all Equipment a million also X% driven actual America. was or first-out quarter unfavorable negatively We prior to quarter. Defense Access on dynamics, cost at cost expectations that million the prior representing a Access on dynamics, a material & cost the sales particularly we a year, improve by sales demand by increase. increased Commercial. for Emergency, consolidated increase $XXX Consolidated decrease Equipment. of $XX were billion quarter over disruptions, to in $X.XX call. North by XX% The third significantly fourth $XX a expected sales XX% $XXX

unfavorable prior deliveries, sales lower sales was sales. were in product of volume. our the quarter of the Fire a cost fourth material efficiencies, X.X% lower year spending increase As on $XXX price of the sales adjusted as million, disruptions. and increased a costs the to manufacturing previously manufacturing Commercial approximately the mix, & to as income prior subject and package offset sales partially current ARFF X% unfavorable higher return by expectations in sales temporary pandemic result Emergency of increased of the product improve due $XXX.X operating Miller in adjusted Defense Emergency in material prior and return by variances sales quarter, the waned, offset of part quarter operating to a in and cost sales to sales of quarters segment, dynamics. in reductions sales operating the decreased has we of the higher the was the for operating Equipment Adjusted cost Pratt income prior the the & to production in than of in offset absorption. and the supply quarter. improved by adjusted pricing. as increased $X.XX absorption as in mentioned in in material earnings year year adjusted or due Consolidated Defense the costs, income income well manufacturing result higher spending million international JLTV and second In income prior compared impact costs for EPS the the the of sales. benefit a by Commercial and subject result unfavorable Access was and acquired increase million in and chain The spending $XXX.X reductions sales, subject part as unfavorable by of partially by down quarter decreased prior year, and largely an decreased of lower higher cost unfavorable reductions FMTV adjusted pricing. share year, improve result quarter $XX.X sales, compared to temporary higher offset offset improved liability, return decreased temporary year. to unfavorable as operating Fire which adjusted largely or per

stock XXX,XXX of $XX million. Stub will to the period. rates quarter, approximately XX quarter company repurchased by period. across During Demand fourth year-end the Fourth in into XXXX our we for cost as of common quarter indicated the of Please Stub remains segments. expectations shares record slide robust backlogs several continue of for discussion and for strong turn order a the total in our the

chain logistics it forecast volume. supply However, are to sales the disruptions difficult making current and

XX% to deliver increase expect While versus the first a parts period in Stub we our quarter support our likely the higher constraint sales availability of backlogs will XXXX, sales. ability

that uncertainty, quarter be levels period of a first provide at basis. this are than expect for consolidated on this Stub will of the and expectations quantitative to XXXX period breakeven Stub result unable We time. a As EPS approach do we may the lower significantly

$XX a component of costs to million cost We XXXX. Steel quarter of continued headwind dynamics the $XX have versus expect to other increase. first be unfavorable million and will that price

to past in are these equilibrium, costs achieve And price we end businesses for months. XXXX to large in second still the action. experienced to actions catch taken further price of need we We work XXXX -- cost but cases, multiple will take the until believe enable these We so pricing than but XX% need with still further many take expect pricing over to backlogs, the non-defense above will early to several escalation. now quarter greater our of pricing have we levels. prices us escalation, we'll increases through If largely it up actions

quarter in Stub first Since our the spending areas spiked We remained have our in and as travel, infection first quarter our of to such the early spending versus also levels in expect rates higher normalize COVID-XX year XXXX. levels levels Last spending medical. then period and low. advertising begun

We availability constraints labor inefficiencies. also parts drive expect continue will that to

I'll current we strong. appropriate supply actions constraints for the for is subside term our our taking provide environment We'll turn some it time While and longer are believe outlook challenging, back earnings will XXXX further on call. to now John remains closing over that and during comments. businesses over updates January chain very the

and few We to completed those quarters. the expect just a remain next challenging quarter challenges for

right this supply believe we're we success position chains the improve. as actions through as taking for we period ourselves However, manage

programs significant company. and XXXX in we are the won as and also We profitable driving advance committed serve, to innovate, growth long-term

hard turn over Pat team they to XX,XXX all I want Q&A, be thank successful. Oshkosh every for go Before I single day through help the to for to it back and our company sacrifice work members

to back Pat, you. Okay.

question. one, begin questions we to ask queue to remind this please and like follow-up get that questions. like the on period call. plus additional to in of your Afterwards, Operator, I'd you'd please question-and-answer disciplined gents. to ask need if we the follow-up you limit back Thanks everybody, a be

Boeschen from Thank Instructions] Raymond question James. Our first is proceed. you. [Operator Felix Please with

everybody. morning, good Hey,

morning. Good

morning. Good

sort if giving are from chain generally over $XX or pricing headwind and how you year then quarter we if think of price said talk clearly just out could just issues. you price $XX flow parody then, still new of I million slightly headwind by some $XX the about maybe Hey, cost curious by just that better a much backlog XQ. wondering million have perspective how But million, supply a Stub gets time. visibility you as that shades cost is large think you end fiscal know the and directionally

one. can Sure. I Thanks, Felix. take that

increases everything beginning First of North America it all, just since that of the has that, double-digit levels currently we're booking XXXX. the in price in

million the a correct. So, From about in backlog. to the I we backdrop million about period. a as $XX you're think just that's good Stub We cadence, quarterly think see $XX

As quarter our better. seeing center first levels based we second cost similar quarter, the you start expecting be the look that to start meaningfully see we normalizing. priced should said, should backlog, in the that as quarter neutral. largely then we we And by second getting margins to do starts And

I second the think the end of quarter.

price quarter, Excuse we largely third me, the cost neutral. should by be

I free have about Okay. growing for, substantial That's as but I up, or And on grown then, is obviously model cash you who point. John Michael, helpful. balance talked cash not the is this amount and M&A sheet. guys past focal sure know the best has a the of in

the curious that you of right the leave outside forward. on cash going of I'll or M&A balance could just touch about it if of sheet maybe on think there. would environment amount how So, cash and uses you

a for a returning a a John, move, plan a of acquisition is lot always dividends. business is smaller and move. time. acquisition positive Felix. Pratt of because the We sheet growth of our a a exactly talk talked increasing know we moves in focused I've inorganic generated and really the over moves and lot This Miller, about going that buybacks at. was fantastic technologies to we're be how always But got that of great Mobile on investments capital some cash lot of making Boise We're we're us developments, seen bit moves. company. have we do terms we're and and pretty a share do looking about did where of on we how leading balance little pipeline grow quarters I'll our That's to But you've opportunities cash. and we've shareholders. but very our should we And be also few those making very, cash our we've moves. organically we're to about product look constant new prudent which we at ago. think a We smaller Yeah.

So, you'll frothy. is today very active. know, to see But you the M&A us continue as environment

pretty going meaningful moves focused we that want And about differences make the are it. we're how where so, time. prudent to we're careful, to we to make look hey, on -- can at company over And but we grow

So, you'll make continue few moves I think see to us a inorganically.

one did I Felix, And level up into our repurchase to step thing period. the that add, in expect just activities we robust continue other the somewhat quarter. more would I even Stub perhaps

-- buybacks our as that's we allocation So, parts our important also will talked increased about sheer well it's capital strategy. as of dividend that remain today

you. Thank helpful. Very

is question next Please Elliott Stanley with Stifel. proceed. Our from

good of on commentary. environment. curious field for you to the commercialization? prototypes mean, got different I and everyone. EV Hey, the lot segments. the I'm of the you kind an all there that? Thank taking opportunity you units XXXX in XXXX, question. frothy mean, Are a morning, all of of M&A a kind we period I still Is accelerate looking mentioned a at across

curious interest we're given how about that, the seeing. you Just levels think

mostly is look gradually where be for a that commercializing, Access electric, already market next like all years. we today EVs segments where our things EV into the There we're certain When commercializing over are strategy XX put long-term Yeah. we we're to XX will at think work us. platforms. aerial the markets,

XXXX the of course, vehicles the we vehicles, of and in into EV shipping much these more more commercialization you'll that XXXX part start a will market recently, program. it's see Postal put look that U.S. you Service, at where as of of If EV F&E,

segments. So, I started we've think, already now some it in

good and offers year product the is is This see it'll our a a for certainly it's where a margin in great that's From more and as released a this these by every for actual economic to standpoint -- but years it'll EVs giving so year them with created with being gets a XX for goes for of us. good continue economic customers. gradually is customers XX to better sale us, lot And because lot terms I next value electrified. fleets think increase you'll solution. XXXX of and our to benefit a shipment that for

in of Access, a with I America for curtailed opportunities over growth China? kind then, the And some shaken that been some property of just great terms that's growth Great. what's market mean, markets there, happening things strength, the if mentioned Curious in curious what's you of you of the happening how North all. has out. the

China -- is segment of Yeah. still the has will world. It's one bit, construction a has -- economy in one in -- robust in the markets it's the little Equipment China's the already as a a world. And biggest market. but Access slowed market very slowed has it bit, be China of the biggest biggest the

But little it do past we're little bit a a slowed addressing slowed marketplace. it's while who on people there a year. So, great job over great very still has bit, the bullish the China. We've got operations there, incredible

and luck. Thanks of good. Pretty best

is Jerry Goldman question with next Revich from Our proceed. Please Sachs.

Good everyone. morning, Hi.

morning. Good

in through, changes you changes as protection thinking chain, are a talk to price John, environment, or learn, post-COVID you're you coming and COVID can you customers this a and it, give about significant Any what how structural we about exiting through that thinking that of in the potential model result environment forward? post-COVID the the going orders and business so far. call supply

for thanks Jerry the Yeah. question.

capabilities. doing chain in So, enormous our of lifting supply amount heavy we've an been

have dual literally of seen. suppliers disruptions improve some of our and/or the because source just hundreds new We qualified we've of resiliency supply, of to both

of we of but in a it next what of it need So, it for really we chain not let's also at why we've the business? a the hundreds more done give that where take We've We've building lot we facilitate of supply reengineering we had a connecting our of suppliers. and and at issues at do the we're opportunity have lifting, of next visibility need looking the looked that's just past, not helps qualified the we've than short-term, quicker. So, have future, quarter, of what supply for lot we lot heavy and opportunities to to a digitally work we the years look more continue just know been new do for where we've make that in supply. grow chain know us better which we so but a five sure components, as doing

to supply While about much for Access, of chips gave redesigning talk all us commentary them better I chips. opening the which

So, lot heavy there's has been lifting a done. of

we're segment look And and we'd backlogs strong as with this book are talk -- be. when later, of really when come pinch inflation booked about right we at orders, much fast, the those And were before. that seeing a cost we And built, currently the earlier inflation. higher then than stronger we're we those earlier book And were, were get you Equipment backlogs costs in QX. material forecast would we'd they We competent. started month XXXX. than -- for also forecasts price when cost will we'd out usual issue we built material strong as a month what that's created -- what in a a but in now, have that we through If backlogs really and Access we of the wrestling bunch

probably more doing? doing back should than So, in have we have. were locking time, Probably. been should if go We you we

building we doing. it's more forward. forward, we're as being very with material at we backlog as full at aggressive costs going prudently in And based We're we're backlog we As we more go making much go protecting competent are we're we and see what what -- with today. sure as it today, on ourselves look price we're building

to that's as into say what to QX, So, us improvement start confidence see there. that, nice we'll we gives the get

about futures or the demand it's but match now? cycle Are to you of recovery, other demand place words, what those at to instruments? looking of type systems allow the next easy the accelerates pretty to of expanding the the lock-in note, In other done that you the in this, of accelerating? capability on to next costs the function that supply that will as environment the on the Is John, So, base? use And work time demand are have type type when we have environment? time you've is any orders about in of a think like we're two, match we the qualifying expanded

in Jerry, certainly suppliers to price operating. rates side, on see put environment healthy work and how regard in sort with now. because that disruption, our that's you -- right is further or lock-in the situation is the not adder it's a often And costs across unique the certainly but doing now most Yeah. where the we're components, we're the right industry, whether have just cost many backlog escalation, see focus unique trying logistics with or locks level is I facing companies to building, obtaining we other to the of think even order either industries, as been of now we've we're are with particularly the but

Jerry. Thanks

Good discussion. Thanks.

with question proceed. next from Please Volkmann Our is Jefferies. Stephen

taking guys. Thanks morning for back. if question. wondering can my I'm go good Hi, we just

you price That cost with Stub cost? on very a sort then think? like term sort the the of do out you lot resulting You talk that and pressures was did productivity from of those. play us lot into How you XXXX, of about does you talked period labor other of a and also in trajectory. parts helpful, price about Can availability through availability but just talked near sort and

And quarter certainly on providing we've are so we guidance, over going a we time, And believe that's really expecting Sure. and a moving we're chains we in us while know start And second margins dynamic. I labor situation. providing at normalcy return January earnings visibility facing confidence next that's period, think side to the Exact do this pieces. seeing our -- of But have We cadence as better we visibility we're that clear. that call, supply XXXX. guidance as July it. the supply that Well, we're get you chain biggest the a better are that is inefficiencies in there that price start and really cost more we'll so fourth when to we going year the course, and yet Really approach those should of of quarter, Hopefully as gives I at to exit third we not lot that cost right think don't -- in to what in explicit we look to change if that. of that quarter. faced the a for so quarter we of it point that Stub qualitatively. about face time, expect now, it's meaningful labor the this where the We factors -- we're not in talking me, or have look at excuse not we

Yeah. little bigger And picture. bit a Steven,

really supply supply with good look a lot chain where base. period, you done in disruption If at work our of this we've are we

with forecast. supply keep Our to pace in has its production improved base ability our

the is of still Now, to example in chassis. in only not in predict but It's for hard freight, we're domestic ability supply predictability things, little in freight, we've huge supply their predictability door. the talked times challenging, times a really being But we challenges when lead most side it logistics lead costs, a becomes able one areas. running an ocean Chassis We of running to the the problem concern. still lead of the for challenges. times and part, way of biggest get bit nice the terms a the of lot We see to unpredictable. of -- and can and fundamental produce. that And when a it's the improvements of make for suppliers high we're long we had have becomes about the really

the we supply a overall So, logistics on keep but made the of up. ways ability improvements to in still to our go base we have have front,

out, have maybe that's shipped around, inventories And that some of didn't sitting deal your Thanks. then, as that, have helpful. sort but sequentially. like big would a That's I just to you as could look would anything they not might've related there. waiting were Okay. built maybe equipment thought, partially up saw ultimately thought for I parts be I much happening

From a definitely concentration higher and whip levels. seeing we're perspective, materials raw

are Our levels. at lower finished definitely goods

fourth was sales. and that the to see we what of you're think is, is levels ultimately that in seeing impacted the certainly the quarter at not wanted parts supply really I

through still you're inventory think I seeing reading some those supply numbers. chain availability dynamics

you. Thank

Thanks, Steve.

proceed. question next with Dobre Please from Baird. is Our Mig

say your trying we're orders I'm you've If on all put Thank you taken the in price billion. $X.X to call quarter beyond, cost actually address. I'm what for moderate? materials, little convert to cost maybe quarter going moving and the point raw in price too, ordered priced taken the so hopefully commentary. to and are it expecting second are materials it, comment of to this revenue going that this here the at kind and as Access neutral. cost Do a raw you've that morning you into of it looking to you your is finer to this pieces a considered your bake these but prices be curious good everyone. over, in assumptions neutral? is understanding just can even in quarter batch cost this Equipment, Related lot here, to a you're that to fair XXXX current orders little that are Is or or spot that maybe that It's

Yeah.

increases. we've all, So, multiple price going backlog had break we're first different speaking of down and that to not to levels price the

actions the Obviously breakdown were quarter. of at recent our of So, if price the the you middle took that's several pricing fourth we like most more the look levels. there's backlog,

the in yet. weren't are certainly third there level at that orders So, price fourth quarter that booked

much the backlog did very So out a quarters largely be what two We'll with it again, the the half aligns we and have next that's there. shipping see over commentary before. that

the the similar and levels in $XX we then should million today. price of in headwind, again, meaningfully Likewise better. in obviously, period, have it $XX to Stub backlog first gets that cost see you the inventory's million So quarter, headwind

at better third we looking to still So increase second next very, standpoint, price as steel our or start quarter, And visibility costs out seeing that's back quarter obviously, while we are. through where of increases And very said anymore, costs today really rapid an managed at. a pricing what really year. the largely of suppliers cost obviously much are our why with the assumption benefit From second as level. course, not those we we of of the at through quarter getting we're coming neutral. the current elevated we our work -- understand in have of it's and We're the

areas levels tail what current very seeing are that's news off, elevated curves, rates good we is coil spot it rolled out the is think locks like And available look in of on expected meaningfully albeit versus many hot lower still to that if you published the historically. are. I fuel than consistent for at

looking though. rubber to chatter, to and So, from at. chassis. labor components We're decisions pricing all third-party that commercial those are from just things steel at all looking we're It's not to aluminum, -- our components

at Mig. looking we're So, holistically, it

of really to the I need equation. cost look our double-digits where healthy orders and emphasize, that the level. rates because healthy. order to alone, of independent all I gets rates at are us Mig, national across material rental companies, at -- are backlog Access price And come of And percent And at up really that rental in new our That is be price we healthy. costs terms to at just market companies, order our Access level. recently alone, If of inflation. right? in of is our price The that's if look full All commercials our all across

Jerry sort beyond an here talked are sort at you're guess running been gain wondering a can back think Thank additional So asking to I process forward? some of business been some the can of or and you cost for become structurally, sort level going mean, back see. and earlier. be on order managed to next I what's relative what's your to performance showed looking flaws for you skeptics, better is some how was as the maybe would at this right, in you. And -- the year these confidence question maybe happening disruptions half cycle it'd peers, process there others. would given also things some And of to the of intake you're up terms that dissipate. you that going relative -- could that then than eventually which implement qualifying was you about, of suppliers, investors there's I be here headwinds go in through look, that that analysis, to that a going inflation, of I'm procedural sooner cycle

to question Absolutely, emphatic. an I as think the answer your yes.

I'd how backlog how that say in were just along mean, I we are a terms was from an it built in, where constantly. changing -- let's got forecast there's it, We September almost. much from away everybody was -- kind March, with of fast of April call a kept it through escalation period, cost unusual

you put and escalate okay will were So, escalate we And you thought change. seeing learn would certain with then place. we and more escalate, forecast in we and and but kept cost it level will just absolutely the practices a specific

in we're So type there's rapid a rapid also protected with of backlog of more this that that a that escalation it. cost goes event, future the from the buildup in

those about talking curves out in we're when fuel that looking really at the And we're marketplace. published forecast, Yeah. are the

We very view think obviously to I a and we're elevated other cycles orders, back field when the come down, February to a if going is few happened. book dissimilar already timeframe, to you clock that there is starting case. in months different to trajectory is be meaningful for roll the not saw which what's a this

increase And push the obviously so, companies globe at view are -- continue those that longer. looking and that out across published, came to that that forecasts were

at dealing I we're factors definitely you in the now seen we And look right we pandemic. nature. -- how we is haven't other with dealing certainly end tunnel we the some see solid we're manage again, short second recoveries. as what the exit And quarter. the think at in that. And it's delivered unique that So, again, through with light Obviously, term the results through of

And just we few through -- emphasize, going all. I'll Mig, at what like a we're this don't

of disruption it. will quarters us. We few It's learn from a for

is answering Equipment. are Access in cycle believe We we multiyear a what

in competent issue confident for growth that cycle deliver our to completely as in very spite and do our our short-term customers We're to are multiyear ability deliver ability for to a we We this our we're go through in. that of in investors.

Mig. Thanks,

Good luck. comments. the for Thanks

with Chad proceed. Dillard Please Our is Bernstein. from question next

Chad. This everyone. Brandon morning, Good on is question. for Quick

So backlog what next guys the based customer rental rental companies like terms of in company? terms year national of independent rental right now, conversation in you on in are the expecting -- versus mix

each it shift just one. XX%. That's backing so going don't This we up, slightly can first saw expect heavily last all, the I expect over take two year-over-year. forward. the We -- major mix we similar year, mix, But weighted of Yeah. there. that years, towards mixes more similar nationals that mix a pretty

the business should how of Defense about we into follow-up, line and expect one in top then in it XXXX? for growth how USPS? XXXX, in goes to on the think And XXXX Can we some then top Cool. see the

Sure.

that weapons As to we We'll see of we're JLTV the downward revenues. the really last happen on have USPS XXXX, XXXX, we and in more pressure up is robust That system couple in of to much of revenue. caliber some as the look with volumes at expect any of be back been years, will saying USPS, put XXXX, start as revenue. to going we think in Defense's we've tied XXXX going medium We'll And which obviously of do over are lower. -- a a going half not to seeing that XXXX. really, of ramp and build

XXXX Department vehicles a way programs wheeled and growing. base our -- business. primarily to the critical Today, growing they're for Defense. of tend where are there Why But say the cycles cycles through for that's at this is that Tactical and adjacent not this and where programs during business? It's in States big more winning Postal that growth It's business is drive more. competing for program, growth Service programs the are importantly, because a onward. are half These the and we're say going are growth, driving or the nature, we programs I go then they're really do it's Defense great a of are United MCWS from lot to it's tactical to John. second and wheeled vehicles a business. us. wheeled program. growth way Brandon, material business like that growth The a look XXXX

wheeled tactical three that business know to execute we this adding how plus it incremental that business growth years. next having to five a So this program over wins on, the of got where drives base vehicles

all. you Thank Great.

Thanks.

final Please Thein is Our Citigroup. Tim proceed. with from question

should Defense, role terms -- you quick of for good of I LIFO how your performance near the just question, in accounting. of that's press in of prospects there. that we of growth of there's But in to update Mike, some cuts or at thoughts to that continue And John, just of kind reports term along larger the that, can some of think a played you Thank about you. in but of some a Great. the you. about reminder timing Thank on context us last versus think I'm the the JLTV how difference sure just recent terms certainly aspect maybe peers. volumes. do some thought, earlier least potentially terms in train the

Yeah.

go is The So, downs. and would XXXX XXXX ups volumes and -- thing focused here's how through on that the I the vehicles. we be think budgets about still be presidential down, about their is always JLTV. will that indicate programs their will XX,XXX likely objectives down. These What's Army's recent acquisition

X,XXX it I think it's all precisely XX,XXX up vehicles. And then, units. XX,XXX the Marines U.S. or XX,XXX to went the from increased and way

units. we've date, to XX,XXX Now shipped about

so presidential and platform then it's -- and fundamental other on And from base focused build for to and program we're and knowing as great be and business. is Army That's long-term, But us a that up into customers, forth, in go top to XX,XXX and wins years of the objective But that ups going objective two year-to-year. XXXX. long of on a JLTV can objective. here we to these world. that there'll beyond with I on on, the that's down getting -- operate. and that's priorities the it's the long-term well we focus the way we be nice around will programs. Defense and is for acquisition a XXXXs, say business program the the are the Army's And these this growth run programs terms for So, biggest you going a and base happening units to see what really be and Marines, this company. the great Marines acquisition why JLTV business. we still These a of Army have programs for our There's there's based what's these the budgets And some why Marines downs that

Got it.

Okay. just In interest there. of leave it Thank I'll time, you.

Tim. Thanks,

have conference over We reached our turn to remarks. would I end to like management the of the back session. for closing question-and-answer

wish Corporation, and safe interest thank in everybody Appreciate healthy your us Oshkosh today. everyone next So a for quarter. joining and

This Thank conclude does today's you. conference.

at time participation. and may disconnect lines You your for your this you thank