ICON Group International Ltd. has released two of the most comprehensive studies to date on vertical gap analysis and labor productivity benchmarks for JLG Industries Inc.
The methodologist for this unique study is Philip Parker, Eli Lilly chair professor of Innovation, Business and Society at INSEAD (Fontainebleau, France and Singapore). According to Parker "We created these reports in response to two inescapable trends: a return to fundamentals and globalization." The goal of these reports is to assist consultants, financial managers, strategic planners, and corporate officers in gauging indicators of JLG Industries Inc.’s financial and human resource structure.
The report has benchmarked JLG Industries Inc. against competing firms in the Construction, Mining and Materials Handling Machinery and Equipment industry worldwide--going beyond traditional methods of company benchmarking. The results are two specialized reports: (1) global financial benchmarks using common-size statement ratios (vertical analysis), and (2) labor-productivity and utilization measures collected across borders. Parker noted, "With the globalization of markets, greater foreign competition, and the reduction of barriers to entry, it becomes all the more important to benchmark a company’s financial indicators on a worldwide basis."
Parker stated, "We are intrigued by the wide variations in basic financial and productivity measures between JLG Industries Inc. and other Construction, Mining and Materials Handling Machinery and Equipment companies. The Earnings Before Interest And Taxes (EBIT), for example, varied from -9.17 to 23.3. We see this type of variation in the hundreds of ratios that we estimate."
The Coverage of the Reports
Two reports, financial ratios and labor productivity ratios, are available for JLG Industries Inc. Each report reveals productivity and industry ranks for companies in the Construction, Mining and Materials Handling Machinery and Equipment industry. Reports for 71 of JLG Industries Inc.’s competitors in Construction, Mining and Materials Handling Machinery and Equipment are also available including: Baker Hughes Inc, Caterpillar Inc., Columbus McKinnon Corp., Cooper Cameron Corpn, Daifuku Co Ltd, Furukawa Co. Ltd., Grant Prideco Inc., Ingersoll-Rand Company, JLG Industries Inc., Jungheinrich AG, Komatsu Ltd., Larsen & Toubro Limited, Linde Aktiengesellschaft, Nacco Industries Inc., National-Oilwell Inc., Schindler Holding AG, Smith International Inc., Swisslog Holding AG, Terex Corpn, The Manitowoc Company Inc., United Dominion Industries Limited, Varco International Inc., Wabash National Corp., and Weatherford International Inc.
The reports answer such questions as: How has JLG Industries Inc.’s asset structure varied compared to global benchmarks for the Construction, Mining and Materials Handling Machinery and Equipment industry? Does it generally hold more cash and other short-term assets, or does it tend to concentrate its assets in physical plant and equipment? On the liability side, does JLG Industries Inc. typically have a higher percent of payables compared to the benchmarks, or does it hold a higher concentration of long-term debt? Does JLG Industries Inc. have a relatively higher cost of goods sold, operating costs, or income taxes compared to global benchmarks? Have JLG Industries Inc.’s returns on equity been higher or its profit margins greater? What has been the ratio of short-term and long-term assets to employee? What are typical capital-labor ratios? What are the average sales and net profits per employee compared to global benchmarks?
The Methodology
Most vertical analyses merely focus on benchmarking against domestic ratios, often published by government agencies or commercial sources. In contrast, the report calculates thousands of industry norms by looking at firms at the global level, pooling statistics on tens of thousands of companies across more than 40 countries, and applying a seven-stage methodology: (1) identification of industry classifications, (2) firm-level data collection and aggregation, (3) standardization of raw statistics, (4) filtering outliers, (5) calculation of global norms, (6) projection of deviations and gaps, and (7) projection of ranks and percentiles. For each part of the financial statement, the larger structural differences and gaps between JLG Industries Inc. and the global benchmarks are provided with summary tables of ranks and percentiles.
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