Briggs and Stratton Reports Improved Results for the First Quarter of Fiscal Year 2015

MILWAUKEE, Oct. 15, 2014 -- Briggs and Stratton Corporation today announced financial results for its first fiscal quarter ended September 28, 2014.

Highlights:

• First quarter fiscal 2015 consolidated net sales were $292.6 million, a decrease of $24.7 million or 7.8% compared to the prior year
• First quarter 2015 consolidated adjusted net loss was $9.3 million, an improvement of 43% from the adjusted net loss of $16.5 million in the first quarter of fiscal 2014
• First quarter fiscal 2015 adjusted diluted loss per share was $0.21, an improvement from the adjusted diluted loss per share of $0.35 in the prior year
• Completed the acquisition of Allmand Bros., Inc., a leading designer and manufacturer of high quality towable light towers, industrial heaters, and solar LED arrow boards, for total consideration of approximately $62 million in cash for all outstanding shares, net of acquired cash
• Fiscal 2015 earnings related to Allmand anticipated to be accretive to earnings per share by $0.07 - $0.08 per diluted share, excluding deal expenses

"As we expected, the first quarter results reflect improved profitability in both the engines and products businesses despite lower engine sales," said Todd J. Teske, Chairman, President and Chief Executive Officer.  

"Coming into the fiscal year, we anticipated that higher channel inventories of lawn and garden equipment would impact our first quarter engine sales compared with last year which benefitted from lower channel inventories and strong late season retail sales of equipment.  Our OEM customers and retailers have taken actions to reduce inventories which impacted our engine sales." 

Teske continued, "Despite the sales decrease, we are pleased with the improved margins in both the engines and products businesses, reflecting the cost cutting actions and our focus on higher margin products, including the acquisition of Allmand." 

Consolidated Results:

Consolidated net sales for the first quarter of fiscal 2015 were $292.6 million, a decrease of $24.7 million or 7.8% from the first quarter of fiscal 2014.  The decrease primarily relates to lower sales of engines resulting from higher channel inventories in North America and lower sales of engines for snow thrower OEM customers in Europe due to adequate inventories following last season.  The decrease in net sales was partially offset by higher sales of pressure washers, snow throwers, lawn and garden equipment and the Allmand acquisition.

The fiscal 2015 first quarter consolidated net loss, which includes restructuring expenses and acquisition related charges, was $15.3 million or $0.34 per diluted share. The first quarter of fiscal 2014 consolidated net loss, which included restructuring charges, was $19.3 million or $0.41 per diluted share.

Non-GAAP Financial Measures and Segment Reporting

This release refers to non-GAAP financial measures including "adjusted gross profit", "adjusted segment income (loss)", and "adjusted net income (loss)".  Refer to the accompanying financial schedules for supplemental financial data and corresponding reconciliations of these non-GAAP financial measures to certain GAAP financial measures.

Beginning in fiscal 2015, the Company is using "segment income (loss)" as the primary measure to evaluate operating performance and allocate capital resources for the engines and products segments. Previously, the Company used income from operations. Segment income (loss) is defined as income (loss) from operations plus earnings of unconsolidated affiliates. The Company has recast prior year amounts for comparability, and has included a reconciliation from consolidated segment income (loss) to income (loss) from operations in the accompanying Adjusted Segment Information table.

Engines Segment:

Engines segment net sales of $153.1 million in the first quarter of fiscal 2015 decreased $30.7 million or 16.7% from the prior year.  Total engine volumes shipped in the quarter decreased by 18.7% or approximately 200,000 engines. Net sales decreased as anticipated due to higher channel inventories in North America at the end of the current lawn and garden season and lower shipments into the European market for snow throwers.

Engines adjusted segment loss in the first quarter of fiscal 2015 was $13.7 million, an improvement of $1.1 million from the prior year. Engines segment adjusted gross profit margins improved 350 basis points year over year on higher manufacturing volume, improved efficiency and lower retirement plan expense.  Engines produced were higher by 12% in the quarter benefitting adjusted gross margins by approximately 230 basis points.  Engine production was increased to support higher demand for large engines for riding equipment to support pre-building of products related to the closure of the McDonough, Georgia facility.  In addition, plant efficiency improvements, cost reductions and a favorable mix of engines produced benefitted adjusted gross margins by approximately 130 basis points.

The previously announced retirement plan changes, which were implemented in January of calendar 2014, improved fiscal 2015 adjusted gross margins by $2.2 million, or 150 basis points.   Partially offsetting this improvement was unfavorable sales mix that reduced adjusted gross margins by 160 basis points.   The retirement plan changes also reduced engineering, selling, general and administrative expenses by $1.6 million.

Products Segment:

Products segment net sales of $166.1 million in the first quarter of fiscal 2015 increased by $13.1 million or 9% from the prior year. This increase was due to higher sales of pressure washers, commercial lawn and garden equipment and snow throwers in the North America market and one month of the Allmand acquisition. Partially offsetting the increase were lower sales of snow throwers in Europe following last year's mild winter and lower generator sales due to adequate channel inventories and no major storm activity.

Products adjusted segment income in the first quarter of fiscal 2015 was $0.9 million, an improvement of $6.7 million from the prior year adjusted segment loss. Products adjusted gross profit margins increased by 370 basis points year over year due to improved sales mix and higher manufacturing throughput.  Favorable sales mix improved adjusted gross margins by 220 basis points due to a focus on selling higher margin lawn and garden equipment and the benefit of one month of the Allmand acquisition. 

In addition, manufacturing throughput increased year over year by 55% benefitting adjusted gross margins by approximately 190 basis points.  Throughput is increased due to higher snow thrower production for channel refill in the North America market and higher production of pressure washers and riding mowers to facilitate the upcoming closure of the McDonough, Georgia plant. 

Offsetting the increase in adjusted gross profit margins was an unfavorable foreign exchange impact of approximately 40 basis points primarily due to the devaluation of the Australian dollar.  Engineering, selling, general and administrative expenses increased $1.5 million due to the Allmand acquisition and increased compensation expense, partially offset by $1.2 million in savings related to the restructuring initiative announced in July 2014.

Allmand Bros., Inc. Acquisition:

The Company announced on August 29, 2014, that it had completed the acquisition of Allmand Bros., Inc. for approximately $62 million in cash, net of cash acquired.  Allmand is a leading designer and manufacturer of high quality towable light towers, industrial heaters, and solar LED arrow boards. Allmand, which is included within our Products segment, has annual net sales of approximately $80 million.

Corporate Items:

Interest expense for the first quarter of fiscal 2015 was comparable to the same period a year ago.

The effective tax rate for the first quarter of fiscal 2015 was 40.9%, compared to 29.3% for the same respective period last year. The higher tax rate for the first quarter of fiscal 2015 was primarily driven by the reversal of previously recorded reserves as a result of the effective settlement of the Company's IRS audit for its 2009-2010 consolidated income tax returns.

Financial Position:

Net debt at September 28, 2014 was $163.1 million (total debt of $225.0 million less $61.9 million of cash), or $53.2 million higher than the $109.8 million (total debt of $225.0 million less $115.2 million of cash) at September 29, 2013. Cash flows used by operating activities for fiscal 2015 were $48.9 million compared to $52.9 million in fiscal 2014. 

The slight improvement in operating cash flows was primarily related to an improved net loss and a decrease in accounts receivable due to lower sales, partially offset by higher inventory levels and accounts payable. In addition, the Company paid cash of $62.1 million for the Allmand acquisition in the first quarter of fiscal 2015 compared to no acquisitions in the same respective period last year.

Restructuring:

During the first quarter of fiscal 2015, the Company began implementing the restructuring actions to narrow its assortment of lower-priced Snapper consumer lawn and garden equipment and consolidate its Products segment manufacturing facilities in order to reduce costs.  The Company will close its McDonough, Georgia plant in the second half of fiscal 2015 and consolidate production into existing facilities in Wisconsin and New York.  

Pre-tax restructuring costs for the first quarter of fiscal 2015 were $7.8 million and pre-tax savings were $1.2 million.  Pre-tax restructuring cost estimates for fiscal 2015 remain unchanged at $30 million to $37 million. Total annual cost savings as a result of these actions are anticipated to be approximately $15 million to $20 million with approximately $5 million to $7 million expected to be realized in fiscal 2015 and the remainder realized in fiscal 2016.

Share Repurchase Program:

On January 22, 2014, the Board of Directors of the Company authorized up to $50 million in funds for use in the Company's common share repurchase program. On August 13, 2014, the Board of Directors of the Company authorized up to an additional $50 million in funds for use in the Company's common share repurchase program.

The common share repurchase program authorizes the purchase of shares of the Company's common stock on the open market or in private transactions from time to time, depending on market conditions and certain governing loan covenants.

During the first quarter of fiscal 2015, the Company repurchased 905,164 shares on the open market at an average price of $19.62 per share. As of September 28, 2014, the Company has remaining authorization to repurchase up to approximately $70 million of common stock with an expiration date of June 30, 2016.

Outlook:

We are increasing our fiscal 2015 projections to include the Allmand acquisition. Previously, we expected net income to be in a range of $50 million to $60 million or $1.07 to $1.27 per diluted share. We are now estimating fiscal 2015 net income to be in a range of $53 million to $63 million or $1.14 to $1.35 per diluted share prior to the impact of acquisition expenses, additional share repurchases, or costs related to our announced restructuring actions.

We are also increasing our projections of consolidated net sales for fiscal 2015 to be in a range of $1.94 billion to $2.0 billion. We continue to estimate that the retail market for lawn and garden products will increase 1-4% in the U.S. next season. Sales estimates do not include the impact of landed hurricanes. 

Operating income margins for fiscal 2015 are expected to improve over fiscal 2014 and be in a range of 4.5% to 5.0% and reflect the positive impacts of the restructuring actions, particularly in the last quarter of the fiscal year. Interest expense and other income are estimated to be approximately $19 million and $7 million, respectively.

The effective tax rate is projected to be in a range of 30% to 33% and capital expenditures are projected to be approximately $60 million to $65 million.  

About Briggs and Stratton Corporation:

Briggs and Stratton Corporation, headquartered in Milwaukee, Wisconsin, is the world's largest producer of gasoline engines for outdoor power equipment.  Its wholly owned subsidiaries include North America's number one marketer of portable generators and pressure washers, and it is a leading designer, manufacturer and marketer of lawn and garden, turf care and job site products through its Simplicity®, Snapper®, Ferris®, Murray®, Allmand, Branco® and Victa® brands. Briggs and Stratton products are designed, manufactured, marketed and serviced in over 100 countries on six continents.

No Regrets: Stihl Stays Strong in Hampton Roads

VIRGINIA BEACH -- October 13 -- When power-tool maker Stihl was casting for a site for its U.S. headquarters 40 years ago, the choice came down to Hampton Roads, Connecticut and Arkansas.

The German manufacturer decided on this region because of its access to the port and supply of ex-military members, said Nikolas Stihl, grandson of the company's founder, who made his annual visit with other company executives to the Virginia Beach plant last week.

The Stihls have no regrets.

The 150-acre complex off Lynnhaven Parkway is among the city's biggest employers, with about 1,950 workers. It turns out 50 percent of the power tools that Stihl sells worldwide. And it plans to keep making more.

Stihl expects another record year for sales, with an even larger increase than last year's.

Sales rose more than 6 percent in 2013, both domestically and internationally, said Nikolas Stihl and Fred Whyte, president of Stihl Inc., the U.S. division based at the Beach. Worldwide, sales topped $3.3 billion. The company does not provide dollar totals for the United States.

This year, they said, the increase should reach 8 percent. And that, Whyte said, is without a major hurricane, which boosts business with its massive cleanups.

In an hourlong interview at the Cavalier Golf and Yacht Club, Whyte and Stihl - the chairman of the supervisory board of the parent company, Stihl Holding AG and Co. KG - also spoke about the challenge of finding skilled labor in the United States, the brief interlude when Whyte was Stihl's boss and why the company has steered clear of lawn mowers.

The company's distribution strategy, they said, has laid the groundwork for its success: You won't find a Stihl chain saw in a big-box store. They can be bought only at independent dealers - the United States has 8,500 - who also repair the tools.

Stihl, 54, quoted his grandfather, Andreas, who founded the company in 1926: "A chain saw is only as good as its service." Or as Whyte said of the customers who rely on Stihl's products: "If their tools aren't working, they're not making money."

That philosophy partly explains why Stihl isn't in the lawn mower business in the United States and won't enter it.

The dealer system operates on the assumption of fast repairs, Stihl said, and that would be harder to achieve with mowers.

In addition, Whyte said, big-box stores already have 80 percent of U.S. lawn mower sales. And the assembly system for lawn mowers, which Whyte said relies on multiple suppliers, wouldn't jibe with the approach at Stihl, which manufactures most of the parts for its tools.

When asked the biggest disadvantages of operating in the United States, Stihl started with the tax level. Next: The difficulty of finding skilled labor. "The quality of the school system in the United States has decreased a lot," Stihl said.

Whyte pointed to Germany's more rigorous program for training trades people. "You don't just get into a pickup truck, put a sign up and decide to become a maintenance technician," he said.

During the recent recession, Stihl benefited from the downturn in the auto industry, Whyte said. "We recruited significantly... into the Rust Belt and were able to pirate a lot of strong people out there."

Stihl occupies 2.2 million square feet in Virginia Beach. The company does not disclose the number of products manufactured, but Whyte said the plant makes more grass trimmers than any other product. Stihl's other items include brush cutters, hedge trimmers and handheld and backpack blowers.

In terms of sales dollars, 60 percent of the items made in Virginia Beach stay in the United States. The remaining 40 percent is distributed among about 95 other countries.

The plant has 141 robots, performing such tasks as inserting screws and loading pallets. That number will only grow, Stihl said: Any worker whose job becomes obsolete will be shifted to a new one.

Nikolas Stihl, who received a doctorate in mechanical engineering, worked in Virginia Beach for seven months in the early '90s as a product manager. His boss was Fred Whyte, who had taken over in 1992.

"I'm glad I approved his expense reports," Whyte joked.

Stihl described Whyte as a talented manager who is "good at recognizing the strength of his people and letting them play to their strengths." Whyte said, "We just hit it off extremely well. The two of us were instrumental in getting a new chain saw model we needed for the market."

It's still not clear how much longer Stihl will be Whyte's boss.

Whyte had planned to retire last year, but he's still in charge in Virginia Beach, and Stihl said there's no firm date for a transition.

"Mr. Whyte has been instrumental for the success of the company since 1992," Stihl said. "You've seen the growth yourself. It's not easy to replace someone in such a position. We have to be very careful in doing that."

Whyte, 67, said: "I still enjoy what I do every day." But he added that he looked forward one day to "taking care of my personal life, like getting better so I can beat my wife in golf."

Philip Walzer   The Virginian- Pilot    www.hamptonroads.com     

Briggs and Stratton Joins SmartEquip Network

October 10 -- Briggs and Stratton, the world’s largest producer of gas engines for lawn mowers, snow blowers, portable generators, pressure washers and other outdoor equipment, announced that it is joining the SmartEquip Network to provide electronic parts and service support and procurement. Also coming on board the network is Class C Solutions Group, formerly known as Barnes Distribution North America, a supplier of vendor-managed inventory programs to the construction equipment industry, which will provide integrated parts support and procurement.

“Briggs and Stratton continues to demonstrate its commitment to improving process and transactional efficiencies for its customers,” said Doug Dougherty, vice president of North America service sales for Briggs and Stratton. “By joining the SmartEquip Network, we are extending our electronic product support capabilities, and our parts-ordering efficiencies, directly into the operating platforms of our customers, delivering real savings and improving equipment uptime.”

“Briggs and Stratton’s fleet presence across the market shows the potential for tremendous savings for the industry,” said Mike Kendall, SmartEquip director of OEM business development. “We very much welcome the partnership opportunity to support this significant new equipment footprint.”

CCSG executives were equally pleased to be part of SmartEquip. “CCSG is committed to providing vendor managed inventory supply chain solutions that lower total costs for MRO consumables,” said Ray Rutledge, managing director of CCSG. “By joining the SmartEquip Network, we can extend those solutions directly into the operating platforms of our customers, delivering significant savings and improving equipment uptime. We think this is an excellent combination that will create value for all SmartEquip Network members.”

“Class C Solutions Group’s use of lean principles for vendor managed inventory offers the potential for tremendous savings across the industry,” added Kendall. “We very much welcome the partnership opportunity to provide additional transactional efficiency gains to our network customers.”

Rental companies and equipment fleets utilizing SmartEquip’s e-FleetPro technology can anticipate the availability of both Briggs and Stratton and Class C Solutions Group parts and service support information on the SmartEquip Network in the fourth quarter of 2014.

Briggs and Stratton Corp., headquartered in Milwaukee, includes such brands as Simplicity, Snapper, SnapperPro, Ferris, Murray, Branco and Victa. The company’s products are designed, manufactured, marketed and serviced in more than 100 countries on six continents.

Class C Solutions Group specializes in inventory management for small but essential consumables, offering more than 1 million items from about 3,000 suppliers.

www.rermag.com

Techtronic Industries Receives Home Depot's Partner of the Year Awards

HONG KONG, October 9, 2014 – Hong Kong-based global power equipment and floor care company Techtronic Industries Co. Ltd. (“TTI”/ The Group) received two coveted top awards at The Home Depot Annual Supplier Partnership Meeting in Atlanta, GA.

The Home Depot, the world’s largest home improvement retailer, presented Milwaukee Tool with the “Partner of the Year Award" for the Hardware Department. This award is representation of Milwaukee Tool’s excellence in collaboration, strategic vision and commitment to succeed in the market in 2014. Chosen among several of the largest companies in the home improvement industry, Milwaukee Tool is honored to receive the award for the second year in a row, and a third time in the last four years.

TTI Floor Care North America received “Partner of the Year” for 2014 and was selected for its outstanding service, innovation and design in the Appliance category. The company was recognized for a number of accomplishments including launching multiple, new floor care products such as the Hoover Air Cordless upright, the Hoover FloorMate hard floor cleaner, two new carpet washers and the entire Home Depot branded accessory lineup.

In addition, the Ryobi® One+ Airstrike Nailer and Stapler tools and the Hart Quick-Tatch interchangeable trowels and floats systems were honored by being finalists in the Top 10 Product Innovations.

Mr. Horst Pudwill, Chairman of TTI, said, “Our partnership with The Home Depot continues to strengthen. TTI is committed to providing world-class products and industry leading innovation.”

Mr. Joseph Galli, CEO of TTI, commented, “We are extremely proud receiving these outstanding awards and recognitions from The Home Depot for our efforts in 2014. The TTI organization is delivering a continuous flow of compelling and innovative new products and the teams are committed with relentless dedication to provide service excellence to drive The Home Depot success.”

Generac Acquires North Dakota Mobile Heater Manufacturer

October 2 -- Waukesha-based Generac Holdings Inc., a designer and manufacturer of generators and other small engine powered products, has acquired Bismarck, N.D.-based MAC Inc. and its related entities.

MAC is a leading manufacturer of premium-grade commercial and industrial mobile heaters in the U.S. and Canada. It has about 100 employees.

 “The acquisition of MAC is an exciting development for Generac as it further expands our growing mobile products platform by adding a strong brand of industrial heaters and increases our access to the projected long term up-cycle in the oil and gas market,” said Aaron Jagdfeld, president and chief executive officer of Generac. “In addition to gaining immediate access to a broad lineup of mobile heating equipment that is essential to colder climate oil & gas and construction sites, this acquisition creates cross-selling opportunities with our existing mobile products distribution.”

The MAC management team will continue to lead the company, and the MAC product brand will be retained and will join Generac's family of brands. The purchase agreements were executed and the transaction simultaneously closed on Wednesday.  The purchase price and terms of the transaction were not announced.

“We’ve worked hard to build MAC into a great company, and we believe that partnering with Generac best positions our organization for continued growth,” said Michael Seifert, president and chief executive officer of MAC Inc. “We are excited to be joining the Generac team, and we see many synergies for both companies as a result of this transaction.”

MAC primarily serves the oil & gas and construction markets, as well as other industrial sectors through national equipment rental companies and independent dealers. MAC’s line of flameless, indirect-fired and hydronic surface heaters are recognized as some of the safest, most reliable and efficient machines in the market.

www.biztimes.com

Shivvers, CPSC, Recalls Country Clipper Riding Lawn Mowers Due To Fire Hazard

September 24, 2014

Recall Summary

Name of product:

Riding lawn mowers

Hazard:

The ignition module can fail to ground, resulting in overheating and melting, posing a fire hazard.

Units

About 1,650 in the U.S. and 261 in Canada

Description

This recall involves model year 2012, 2013 and 2014 Country Clipper riding lawn mowers. The recalled mowers are equipped with 27-horsepower Kohler Command CV740 or Kohler Courage SV740 twin cylinder engines. The Command engine is dark gray and has the name and model number on a label on the side of the engine near the air filter. The Courage engine has a black engine shroud and has the name and model number on the top of the shroud. The recalled mowers are steered by either a joystick or two steering arms. The recalled mowers were manufactured from October 2011 to May 2014 and include the model names Challenger, Charger, Edge, Jazee, Jazee Pro and Jazee Pro DLX. The following model years and model numbers are recalled:

Model Year 2012	Model Year 2013	Model Year 2014
2748KOJ-SR225	2752KOJ-SR400	2752KOJ-505
2748KOJ-SR375	2752KOJ-SR500	2752KOT-505
2748KOT-SR225	2752KOT-SR400	2760KOJ-505
2752KOJ-SR225	2752KOT-SR500	2760KOJ-1035
2752KOJ-SR375	2760KOJ-SR400	2760KOJ-1505
2752KOJL-SR375	2760KOJ-SR500	2760KOT-505
2752KOT-SR225	2760KOJ-SR1030	2760KOT-1035
2752KOT-SR375	2760KOJ-SR1500	2760KOT-1505
2760KOHJ-SR375	2760KOT-SR400
2760KOHT-SR375	2760KOT-SR500
2760KOJ-SR375	2760KOT-SR1030
2760KOJ-SR1025	2760KOT-SR1500
2760KOJ-SR1220
2760KOJ-SR1220L
2760KOT-SR375
2760KOT-SR1025
2760KOT-SR1220

The mower model number and manufacture date are on the mower serial number plate on the side frame rail by the foot floor pan on the driver's right side.

Incidents/Injuries

Shivvers has received reports of four lawn mower ignition modules overheating and melting. No injuries have been reported.

Remedy

Consumers should immediately stop using the recalled lawn mowers and contact a Country Clipper dealer to schedule a free repair.

Sold at

Country Clipper lawn mower dealers nationwide from October 2011 to May 2014 for between $5,300 and $9,500.

Manufacturer

Shivvers Manufacturing Inc., of Corydon, Iowa

Manufactured in

United States

Consumer Contact:

Country Clipper at (800) 344-8237 from 8 a.m. to 5 p.m. CT Monday through Friday or online at www.countryclipper.com and click on Recall on the left side of the page for more information.

Kohler Company Names New Group President

Tom Cromwell, President of Kohler Engines since 2009, has assumed responsibility for Kohler Co.’s worldwide power operations, reporting directly to David Kohler, President and Chief Operating Officer.

As the new Group President – Power, Cromwell will provide strategic and operational leadership for the Group’s engines and power systems businesses worldwide. He will be responsible for driving the growth and profitability of the Power Group businesses, consisting of Kohler Power Systems, SDMO Power Systems, UPSL, Kohler Engines and Lombardini.

Cromwell joined Kohler after a successful career at Modine Manufacturing Co., in Racine, WI. During his 18 years there, he served as Regional Vice President – Americas and also held a series of general management positions in Modine’s commercial products division, electronics cooling division, and heavy duty division. His experience included a three-year assignment overseas in Stuttgart, Germany, for Modine’s European automotive and heavy-duty equipment divisions.

Cromwell earned his bachelor’s degree in industrial technology management from the University of Wisconsin – Platteville and his executive MBA from the University of Wisconsin – Milwaukee.

www.forconstructionpros.com

Briggs and Stratton's "Watershed" Year

Todd Teske, chief executive officer for Briggs and Stratton Corp., said the company has launched more new products than it has ever launched in a year, but the changes the company needed to make to become innovative required a culture shift, and a big one.

Teske talked about how the company changed its innovation strategy at the Innovate To Grow 2014 Manufacturing and Distribution Executive Summit on Wednesday. And the payoff for the 108-year-old Wauwatosa-based company means that it enjoys an 80 percent market share in the markets it occupies.

“It’s interesting, when you look at how people view Briggs and Stratton, it’s generally an engine company … which we are,” Teske said. “But we’re also a company that is going through a lot of transition.”

Because the company makes engines for power equipment, Briggs knew its business was directly tied to the housing market and after the housing boom management realized the need to diversify its business model. Still, the company continued to be order takers, until the Chinese came along and started manufacturing similar products that were exported to the United States and their pricing was much lower than Briggs’. A number of Briggs’ competitors located in the U.S. started going out of business, Teske said.

In studying the cost differences between China and the U.S., the company came to the conclusion that it didn’t have a cost problem; it had a profit problem, Teske said.

“They don’t have to make as much money as we do. Why? Because there are a lot different policies there than here,” Teske said. “There, you employ people and you get paid. Now, I can tell you if we had that policy here in the U.S., you can’t imagine how many employees Briggs and Stratton would have ... because I would be hiring just to make more money.”

After the housing market burst and the country went into a recession, the company realized that housing drove its business in a big way. So Teske asked his team how the company would compete differently, and that’s when the company defined its innovation strategy.

Changing the corporate structure, Teske had its research and development team report directly to him. The team also focused almost all of its attention on meeting emissions standards because it’s in a regulated industry. The company knew that there would be more emissions regulations in the future, but right now there isn’t anything on the books.

“That allowed us to refocus our R and D dollars,” Teske said.

The company focused on two primary elements: reducing noise and making the engines easier to start.

Briggs launched more new products than it has ever launched in a year with Quiet Power Technology, a motor that the company says is 65 percent quieter than a traditional lawnmower motor; POWERflow+, a pressure washer that is high pressure-low flow and low pressure-high flow; Mow 'n' Stow Engine, an engine that can be stored on its side without leaking gas or oil.

Teske said the upcoming season would feature products that are easier to start that use a lithium-ion battery.

“Again, is this an iPod? No. Little things … little things mean big innovation. That’s our journey,” Teske said.

Denise Lockwood         www.bizjournals.com  

Generac to Hire 100 Statewide

MILWAUKEE -- September 24 -- Waukesha-based Generac Power Systems Inc. today announced it will hire 100 employees in Southeastern Wisconsin, the Fox Valley, Berlin and Oshkosh.

The company, which designs and manufactures generators and other small engine powered products, said the positions will be in customer support, inside sales, engineering and operations. It is encouraging applicants of all levels to attend a job fair tomorrow at its Whitewater facility, 757 N. Newcomb St., from 10 a.m. to 3 p.m.

Generac, which announced the hiring plans at a media day in Whitewater today, also revealed changes to its manufacturing plant that are aimed at attracting a younger workforce that wants tech-savvy careers. It has updated its manufacturing lines to digital machinery. The company said it has had some difficulty recruiting employees in southeastern Wisconsin.

Generac has more than 70 percent of the home standby generator market share nationwide. It has benefited from the rapidly growing residential generator market that has resulted from a rising number of power outages that generator manufacturers attribute to aging power grids and several severe storms that have knocked out power to large areas of the country.

In an October 2013 interview with BizTimes Milwaukee, Generac president and chief executive officer Aaron Jagdfeld said he anticipates Generac's home standby business will grow at between 11 and 13 percent annually going forward.

The company also held a job fair in Oshkosh in May in an effort to fill 100 positions company wide. The majority of the  positions announced today are new, said company spokesman Art Aiello.    

The new positions are "simply part of our continued growth," Aiello said. "Nothing in particular triggered this. We just want to make sure we are staffed appropriately.

www.biztimes.com    

Restored Auburn Nebraska Plant Creating a Buzz as It Hits Its Stride

AUBURN, Nebraska — September 10 -- For a company that trains its workers to “Work like the tortoise, not the hare,” local employees at Ariens Co. sure make quick work of manufacturing outdoor chore equipment.

In the time it takes to mow the lawn in front of the company’s plant in the middle of town, about five riding lawn mowers roll off the production line inside — or one every 675 seconds.

“That’s from sheet metal to a product you can ride out on,” said Cliff Barley, director of operations for Ariens’ Auburn facility.

The Brillion, Wisconsin-based company purchased the plant and business from Auburn Consolidated Industries, which failed in 2007, and has hit a stride in the last year. Employment and production have returned to historically high levels while Ariens has worked to entrench itself among the greater Auburn community.

The company has manufactured and donated equipment for two disc golf courses in Nemaha County. Once a week, one of the plant’s manufacturing leaders leads a welding class in Falls City in an effort that is equal parts workforce development and civic stewardship.

And in late August, company officials announced a $25,000 donation to complete development and construction of a Nature Explore Classroom near the courthouse square downtown.

Auburn Mayor Scott Kudrna said the plant has always been “a stalwart of the local economy,” employing more than 200 people at its peak — but locals in this town of about 3,400 people have needed some convincing that Ariens would continue the tradition of the 88-year-old business.

When Auburn Consolidated closed briefly after going out of business in October 2007, it had about 125 employees. Ariens purchased it from financial stakeholders within a month of the closure, but it has taken time to restore the plant to its former status.

“Auburn Consolidated originally employed many more people than Ariens did and there was a lot of apprehension because we were dealing with a company that no one knew of,” the mayor said. “Families’ lives were shaken up by the closing and selling of the company.”

Fast-forward seven years and local employees are once again building outdoor power equipment. The zero-turn mowers are among the largest products being assembled and shipped out by workers here, and they’re also the newest.

Ariens officials in September 2013 relocated the product line to the largest manufacturing plant in Nemaha County from the company’s home base in Wisconsin.

Since then, employment at the local plant has grown about 30 percent to roughly 200 employees. Total production, meanwhile, has increased by more than 75 percent.

Now, the plant’s buzz around town has attracted employees both young and old.

At an April hiring fair, Barley said he recognized at least two former Future Business Leaders of America members from Auburn High School, where the company also has been engaged with teachers to help revamp the district’s vocational curriculum.

Kevin Raymond, the district superintendent, said improving how the school’s instructors prepare students for jobs is critical. That’s why it has also engaged with officials from the Nebraska Public Power District’s Cooper Nuclear Station — Nemaha County’s largest employer ahead of Ariens — as well as Magnolia Metal Corp. in Auburn.

“In the past three or four years, we’ve tried to build those connections within our community,” Raymond said. “Coming back here and making an impact in Nemaha County is now an option (for students) where maybe it wasn’t before.”

That option has been exercised by people who didn’t grow up in Auburn, as well.

Andy Whaley, a 44-year-old meatpacking industry veteran, moved back to the community about a year ago and had been commuting to Council Bluffs for a job at Tyson Foods Inc.

A newspaper ad for Ariens’ hiring fair in April enticed him to see what community members had been buzzing about. He was eventually hired as the plant’s night shift manufacturing leader.

“I remember starting in the meat business years ago, and that pride in what you’re doing on the floor was there,” Whaley said. “Here, every single person on the floor has that pride and it’s a standard.”

That pride extends beyond the walls of the plant’s manufacturing facility, thanks in part to both the plant’s legacy and its renewed commitment to the greater Nemaha County community.

The funds for the Nature Explore Classroom — a program of the Nebraska City-based Arbor Day Foundation and Lincoln-based Dimensions Educational Research Foundation — helped finalize a project that was years in the making.

The company has participated in local parades, and Ariens-built disc golf equipment was used to establish courses both in Auburn and at nearby Peru State College.

Bob Engles, a local real estate broker who was mayor of Auburn from 2002-10, said that kind of civic engagement reflects Ariens’ own legacy of family ownership dating to 1933.

“The talk of the town in 2007 was that someone would buy (the plant) for next to nothing and sell the equipment on a piecemeal basis and just leave us with an empty building,” Engles said. “Because Ariens is family-owned, decisions were very quickly made and we saw from an economic development standpoint that they wanted the building and the equipment and to maintain all the jobs they could.”

Even though the equipment Ariens manufactures is seasonal by nature — other lines include snow throwers, leaf blowers and stump grinders — the company’s philosophy aims for it to be anything but. It’s in the middle of an effort to maintain a fairly static level of inventory to buoy employment levels at what Barley calls a “sweet spot” of about 200.

“We keep our production level with total demand throughout the year. That stabilizes our workforce,” Barley said. “We don’t want to be that company that brings people in and whacks them up seasonally.”

Cole Epley         www.omaha.com