Recently, JLG (parent company Oshkosh) and Genie (parent company Terex) respectively released the first half of 2023 results announcement, downstream new/replacement demand is strong, superimposed supply chain improvement, JLG and Genie performance are bright.

        In the second quarter of 2023, JLG's revenue was US $1.328 billion, +36.0% year-on-year, operating profit was US $212 million, +191% year-on-year, and operating profit margin was 15.9%, +9.54ppt year-on-year. In the second quarter of 2023, Genie's revenue was $825 million, +38.0% year-on-year, its operating profit was $134 million, +189% year-on-year, and its operating profit margin was 16.2%, +7.50ppt year-on-year.

         According to the financial report, the increase in revenue mainly benefited from the improvement of the supply chain after the recovery of production after the epidemic, the increase in market demand and the price increase it implemented, and the profit improvement was large, thanks to the increase in sales volume, the increase in prices, the favorable product combination machine shipment structure, the strict cost reduction measures and the incremental increase in manufacturing efficiency.

         According to the results of JLG and Genie, the current downstream demand indicators are stronger, on the one hand, the increase in large-scale projects/infrastructure spending, high equipment utilization, and the increase in electrification will bring new demand; On the other hand, the average age of customers is high, and according to JLG's disclosure in May 2022, the average age of aircraft in North America is more than 60 months, which will generate replacement demand.

            As of the end of June 2023, JLG's orders on hand were $4.4 billion, +10% year-on-year; 2Q23JLG signed new orders of $1.3 billion, +30% year-on-year. As of the end of June 2023, Genie orders on hand were $2.7 billion, or -5% year-over-year; 2Q23Genie new contracts were $500 million, -8% year-over-year. Among them, Genie said that the decline in orders on hand was mainly due to the recovery of production and shorter delivery times (but it has not yet returned to the normal level before the epidemic), and because of the strong demand side, it has signed new orders of $1.5 billion for 2024. Overall, orders in hand for both are at historically healthy levels.

           In addition, JLG and Genie both raised their full-year guidance. JLG expects 2023 revenue of $4.9 billion, or +23% year-on-year (but the second half of the year revenue is expected to be slightly lower than the first half of the year revenue, because Q4 will have fewer holiday production days), operating margin of 14.0%, or +6.1ppt year-on-year. Genie expects 2023 revenue of $2.9 billion, or +17% year-over-year, and an operating margin of 13.8%, or +5.9ppt.

          According to JLG results, the United States is currently benefiting from the Inflation Reduction Act and the Chip Act and other demand is very strong, while demand in Europe is also more than expected, and order visibility is higher. But at the same time, JLG pointed out that although the inflation caused by the interest rate hike has eased, it has not seen any signs of deflation in the producer price index and other indicators, so that production costs remain high.