OSHKOSH, Wis. -- Oshkosh Corp. has reported fiscal 2008 third quarter earnings per share (EPS) of $1.19, on sales of $2 billion and net income of $88.8 million. Including pre-tax charges of $175.2 million ($2.33 per share, net of taxes) related to the previously announced non-cash impairment of intangible assets of the Geesink Norba Group, the company’s European refuse collection vehicle business, the company reported a net loss of $84.3 million, or $1.14 per share, for the third quarter of fiscal 2008. These results compare with EPS of $1.21 on sales of $1.8 billion and net income of $90.6 million for the third quarter of fiscal 2007.

Sales in the third quarter of fiscal 2008 increased 6.6 percent compared to last year’s third quarter. These results included strong demand for defense vehicles and armor kits as well as access equipment products in international markets and a decrease in sales for the company’s domestic commercial and access equipment segment products as a result of the slowdown in U.S. construction.

Third quarter fiscal 2008 operating income decreased 5.9 percent to $181.2 million, or 9.2 percent of sales compared to the same period last year. This decrease in operating income was related primarily to lower operating income in the commercial and fire and emergency segments as a result of lower sales and production inefficiencies at the company’s European refuse collection vehicle business, offset in part by strong performance in the access equipment segment.

Operating income in the third quarter of fiscal 2008 increased 27.3 percent to $125.2 million, or 13.6 percent of sales, compared to the prior year quarter operating income of $98.3 million, or 11.3 percent of sales. The increase in operating income in the third quarter was primarily the result of favorable foreign exchange rates as well as higher aftermarket sales and improved product and customer mix.

Operating income was down 38.2 percent in the third quarter to $17.9 million, or 6.4 percent of sales, compared to the prior year quarter operating income of $29 million, or 10 percent of sales. The decrease in operating income during the third quarter was primarily related to lower sales, adverse product mix and a work stoppage at a fabrication facility.

Corporate operating expenses and inter-segment profit elimination increased $4.5 million to $22.2 million for the third quarter of fiscal 2008 compared to the prior year quarter. The third quarter of fiscal 2007 was favorably impacted by a reduction of litigation expense reserves. Higher personnel costs and additional information technology spending to support the company’s growth objectives also contributed to the increase in corporate costs for the third quarter of fiscal 2008. These increases were offset in part by lower incentive compensation accruals.

Interest expense net of interest income decreased $7 million to $49.4 million in the third quarter of fiscal 2008 compared to the prior year quarter largely as a result of lower interest rates and the repayment of borrowings incurred in connection with the JLG Industries acquisition. Total debt decreased $78.6 million during the third quarter to $2.98 billion at June 30, as compared to $3.06 billion at March 31, due primarily to positive cash flow from operations.

Excluding intangible asset impairment charges, the provision for income taxes in the third quarter decreased to 32.9 percent of pre-tax income compared to 36 percent of pre-tax income in the prior year third quarter. The lower effective income tax rate reflected a favorable tax incentive agreement in Europe.

For the first nine months of fiscal 2008, the company recorded net income of $25.6 million, or 34 cents per share. Excluding impairment charges, the company reported that EPS increased 8.6 percent to $2.65 for the first nine months of fiscal 2008 on sales of $5.2 billion and net income of $198.7 million, compared to EPS of $2.44 for the first nine months of fiscal 2007 on sales of $4.5 billion and net income of $182.7 million. JLG was included in the company’s operations for the first nine months of fiscal 2008 compared to only seven months in the prior year following the December 2006 acquisition of JLG. Strong international sales at JLG and increased defense segment sales also contributed to current year sales increases compared to the prior year, while the commercial segment experienced a significant decline in sales due to lower demand in North America generally as a result of lower residential construction activity in the U.S. combined with the aftereffects of the 2007 diesel engine emissions standards changes.

Excluding impairment charges, operating income increased 11.8 percent to $459.4 million, or 8.8 percent of sales, in the first nine months of fiscal 2008 compared to $411.1 million, or 9.1 percent of sales, in the first nine months of fiscal 2007. This increase was driven primarily by the inclusion of JLG results for a full nine months in fiscal 2008 as well as increased defense segment and international access equipment sales, offset in part by lower earnings in the commercial and fire & emergency segments due to the weak U.S. economy, larger operating losses at Geesink and higher corporate costs largely due to higher personnel costs and information technology spending in the first half of the fiscal year. Prior year corporate costs also benefited from a reduction of litigation expense reserves.

The company revised its fiscal 2008 EPS estimate range, excluding impairment charges1, to between $3.15 and $3.30 as compared to EPS of $3.58 in fiscal 2007. Including impairment charges, the company’s 2008 EPS estimate range is 84 cents to 99 cents. These estimates reflect the company’s performance for the first nine months of fiscal 2008, and the company’s expectations for significantly lower results in the access equipment segment in the fourth quarter of fiscal 2008 as a result of lower sales expectations in North America and certain areas of Western Europe and increases in the costs of raw materials. These estimates do not include any potential additional development costs that the company would incur in the event of a Joint Light Tactical Vehicle Technology Development contract award to the company and its teaming partner in the fourth quarter of fiscal 2008.