# FORM 10-Q  UNITED
STATESSECURITIES AND EXCHANGE COMMISSION  Washington, D.C. 20549

|[X] | QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934
|--- | --------------------------------------------------------------------------------------

# For the Quarterly Period
Ended September 30, 2007

# OR

|[_] | TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                    ACT OF 1934
|--- | ------------------------------------------------------------------------------------------------------------

# For the transition
period from .. to  .........

Commission file number
0-18110

|Gehl Company                                          
|------------------------------------------------------
|(Exact name of registrant as specified in its charter)

|Wisconsin                                     | 39-0300430                          
|--------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation | (I.R.S. Employer Identification No.)
|or organization)                             
|143 Water Street, West Bend, WI               | 53095                               
|(Address of principal executive office)       | (Zip code)                          

|(262) 334-9461                                      
|----------------------------------------------------
|(Registrants telephone number, including area code)

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period
that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes X                 No

Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.
See definition of accelerated filer and large accelerated filer in Rule 12b-2
of the Exchange Act.

Large accelerated filer
                Accelerated
filer X        Non-accelerated
filer

Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes                  No
X

Indicate the number of shares
outstanding of each of the issuers classes of common stock, as of the latest
practicable date.

|Class                        | Outstanding at September 30, 2007
|---------------------------- | ---------------------------------
|Common Stock, $.10 Par Value | 12,264,766                       

---

# Gehl Company

# FORM 10-Q

# September 30, 2007

# Report Index

|                                                                       
|-----------------------------------------------------------------------
|PART I. - Financial Information                                        
|Item 1. Financial Statements                                           
|Condensed Consolidated Statements of Operations for the Three and Nine 
|month Periods Ended September 30, 2007 and 2006                        
|Condensed Consolidated Balance Sheets at September 30, 2007,           
|December 31, 2006, and September 30, 2006                              
|Condensed Consolidated Statements of Cash Flows for the Nine month     
|Periods Ended September 30, 2007 and 2006                              
|Notes to Condensed Consolidated Financial Statements                   
|Item 2. Managements Discussion and Analysis of Financial Condition and
|Results of Operations                                                  
|Item 3. Quantitative and Qualitative Disclosures about Market Risk     
|Item 4. Controls and Procedures                                        
|PART II. - Other Information                                           
|Item 1A. Risk Factors                                                  
|Item 2. Unregistered Sales of Equity Securities and Use of Proceeds    
|Item 6. Exhibits                                                       
|Signatures                                                             

-2-

---

# PART I  Financial
Information

# Item 1. Financial
Statements

# Gehl Company and
SubsidiariesCondensed Consolidated Statements of Operations  (unaudited and in thousands,
except per share data)

|                                           
|-------------------------------------------
|September 30,
2006                         
|Net sales                                  
|Cost of goods sold                         
|                                           
|Gross profit                               
|Selling, general and                       
|administrative expenses                    
|                                           
|Income from operations                     
|Interest expense                           
|Interest income                            
|Other expense, net                         
|                                           
|Income from continuing operations          
|before income taxes                        
|Provision for income taxes                 
|                                           
|Income from continuing operations          
|Income (loss) from discontinued operations,
|net of tax                                 
|Gain (loss) on disposal of discontinued    
|operations, net of tax                     
|                                           
|Net income                                 
|                                           
|Diluted net income (loss) per share:       
|Continuing operations                      
|Discontinued operations                    
|                                           
|Total diluted net income                   
|per share                                  
|                                           
|Basic net income (loss) per share:         
|Continuing operations                      
|Discontinued operations                    
|                                           
|Total basic net income                     
|per share                                  
|                                           

The accompanying notes
are an integral part of the financial statements.

-3-

---

# Gehl Company and
SubsidiariesCondensed Consolidated Balance Sheets  (unaudited and in thousands, except
share data)

|                                                       | September 30,
2007
|------------------------------------------------------ | ------------------
|Assets                                                 |                   
|Cash                                                   |                   
|Accounts receivable - net                              |                   
|Finance contracts receivable - net                     |                   
|Inventories                                            |                   
|Assets of discontinued operations - net (Note 3)       |                   
|Retained interest in sold finance contracts receivable |                   
|Deferred income tax assets                             |                   
|Prepaid expenses and other current assets              |                   
|                                                       |                   
|Total current assets                                   |                   
|                                                       |                   
|Property, plant and equipment - net                    |                   
|Goodwill                                               |                   
|Other assets                                           |                   
|                                                       |                   
|Total assets                                           |                   
|                                                       |                   
|Liabilities and Shareholders Equity                   |                   
|Current portion of long-term debt obligations          |                   
|Short-term debt obligations                            |                   
|Accounts payable                                       |                   
|Liabilities of discontinued operations (Note 3)        |                   
|Accrued and other current liabilities                  |                   
|                                                       |                   
|Total current liabilities                              |                   
|                                                       |                   
|Long-term debt obligations                             |                   
|Other long-term liabilities                            |                   
|                                                       |                   
|Total long-term liabilities                            |                   
|                                                       |                   
|Common stock, $.10 par value, 25,000,000 shares        |                   
|authorized, 12,264,766, 12,197,037 and 12,173,035      |                   
|shares outstanding, respectively                       |                   
|Preferred stock, $.10 par value, 2,000,000 shares      |                   
|authorized, 250,000 shares designated as Series A      |                   
|preferred stock, no shares issued                      |                   
|Capital in excess of par                               |                   
|Retained earnings                                      |                   
|Accumulated other comprehensive loss                   |                   
|                                                       |                   
|Total shareholders equity                             |                   
|                                                       |                   
|Total liabilities and shareholders equity             |                   
|                                                       |                   

The accompanying notes
are an integral part of the financial statements.

-4-

---

# Gehl Company and
SubsidiariesCondensed Consolidated Statements of Cash Flows  (unaudited and in thousands)

|                                                           
|-----------------------------------------------------------
|September 30,
2006                                         
|Cash Flows from Operating Activities                       
|Net income                                                 
|Adjustments to reconcile net income to net cash            
|provided by (used for) operating activities:               
|Loss on discontinued operations (non-cash), net of taxes   
|Depreciation and amortization                              
|Compensation expense for share-based payments              
|Cost of sales of finance contracts                         
|Proceeds from sales of finance contracts                   
|Increase in finance contracts receivable                   
|Increase in retained interest in sold finance contracts    
|(Decrease) increase in cash due to changes in:             
|Accounts receivable - net                                  
|Inventories                                                
|Accounts payable                                           
|Remaining working capital items                            
|                                                           
|Net cash (used for) provided by operating activities       
|                                                           
|Cash Flows from Investing Activities                       
|Property, plant and equipment additions                    
|Proceeds from the sale of property, plant and equipment    
|Decrease in other assets                                   
|                                                           
|Net cash used for investing activities                     
|                                                           
|Cash Flows from Financing Activities                       
|Proceeds from (repayments on) revolving credit loans       
|Proceeds from (repayments on) other borrowings             
|Proceeds from and tax benefits on exercise of stock options
|                                                           
|Net cash provided by (used for)  financing activities      
|                                                           
|Net decrease in cash                                       
|Cash, beginning of period                                  
|                                                           
|Cash, end of period                                        
|                                                           
|Supplemental disclosure of cash flow information:          
|Cash paid for the following:                               
|Interest                                                   
|Income taxes                                               

The accompanying notes
are an integral part of the financial statements.

-5-

---

Gehl Company and
Subsidiaries  Notes to Condensed Consolidated Financial StatementsSeptember 30, 2007
 (Unaudited)

# Note 1  Basis of
Presentation

The
condensed consolidated financial statements included herein have been prepared by the
Company, without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles generally accepted
in the United States of America have been condensed or omitted pursuant to such rules and
regulations, although management believes that the disclosures are adequate to make the
information presented not misleading. The year-end condensed balance sheet data was
derived from audited financial statements, but does not include all disclosures required
by accounting principles generally accepted in the United States of America.

In
the opinion of management, the information furnished for the three and nine month periods
ended September 30, 2007 and September 30, 2006 include all adjustments, consisting only
of normal recurring accruals, necessary for a fair presentation of the results of
operations and financial position of the Company. Certain prior year amounts have been
reclassified to conform to the current year presentation. Such reclassifications had no
impact on previously reported net income. Due, in part, to the seasonal nature of the
Companys business, the results of operations for the three and nine month periods
ended September 30, 2007 are not necessarily indicative of the results to be expected for
the entire year.

It
is suggested that these interim financial statements be read in conjunction with the
financial statements and notes thereto included in the Companys Annual Report on
Form 10-K for the year ended December 31, 2006 as filed with the Securities and Exchange
Commission.

# Note 2 
Significant Accounting Policies

Accounting Pronouncements: In
September 2006, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standard No. 157, Fair Value Measurements
(SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring
fair value and expands disclosures about fair value measurements, but does not change
existing guidance as to whether or not an instrument is carried at fair value. SFAS 157 is
effective for fiscal years beginning after November 15, 2007. We are currently evaluating
the impact , if any, of implementing SFAS 157 on our consolidated financial statements.

In
February 2007, the FASB issued Statement of Financial Accounting Standard No. 159,
The Fair Value Option for Financial Assets and Financial Liabilities
(SFAS 159). SFAS 159 permits entities to choose to measure many financial
instruments and certain other items at fair value. Unrealized gains and losses on items
for which the fair value option has been elected are reported in earnings. SFAS 159 is
effective for fiscal years beginning after November 15, 2007. We are currently evaluating
the impact, if any, of implementing SFAS 159 on our consolidated financial statements.

In
July 2006, the Financial Accounting Standards Board (FASB) issued FASB
Interpretation No. 48, Accounting for Uncertainty in Income Taxes  an
interpretation of FASB Statement No. 109 (FIN 48), which prescribes a
recognition threshold and measurement process for recording, in the financial statements,
uncertain tax positions taken or expected to be taken in a tax return. In addition, FIN 48
provides guidance on the recognition, classification, accounting in interim periods and
disclosure requirements for uncertain tax positions. The Company adopted FIN 48 effective
January 1, 2007. The impact of the adoption on the Condensed Consolidated Financial
Statements as of January 1, 2007, was an increase in total assets of $0.4 million, an
increase in total liabilities of $0.9 million and a decrease in shareholders equity
of $0.5 million.

-6-

---

In
September 2006, the FASB issued Statement of Financial Accounting Standards No. 158,
Employers Accounting for Defined Benefit Plans and Other Postretirement
Plansan amendment of FASB Statements No. 87, 88, 106, and 132(R) (SFAS
No. 158), which requires employers to fully recognize the obligations associated
with single-employer defined benefit pension, retiree healthcare and other postretirement
plans in their financial statements.  In addition, SFAS No. 158 requires companies to
measure plan assets and liabilities as of the end of a fiscal year rather than a date
within 90 days of the end of the fiscal year.  The Company adopted SFAS No. 158
effective December 31, 2006, except for the change in measurement date provisions which
are not effective until 2008. The impact of the adoption at December 31, 2006, was a
decrease in total assets of $0.4 million, an increase in total liabilities of $5.3 million
and a decrease in shareholders equity, net of tax, of $3.7 million.

# Note 3 
Discontinued Operations

During
March 2006, the Company decided to discontinue the manufacturing and distribution of
agricultural implement products. The agricultural implement business included one
manufacturing facility and related manufacturing machinery and equipment. The reduction in
headcount totaled 140 employees which included both manufacturing and administrative
positions related to the agricultural implements business. As a result of this action, the
Condensed Consolidated Financial Statements and related notes have been restated to
present the results of the agricultural implement business as a discontinued operation.

The
discontinuation of the agricultural implement business resulted in an after-tax charge to
the Companys earnings for the nine month period ended September 30, 2006 of $7.8
million, or $0.62 per diluted share. The after-tax charge reflected a reduction from the
previous estimate of $9.0 million, or $.73 per diluted share, due to higher than expected
proceeds from the sale of machinery and equipment associated with the discontinued
operations. The after-tax charge is comprised of non-cash asset impairment charges of $5.9
million related to agricultural implement field and factory inventory and certain
property, plant and equipment, and cash charges related to severance and other employee
termination costs of $1.9 million. There was no charge to the Companys earnings for
the nine months ended September 30, 2007.

-7-

---

The following table summarizes the
pre-tax charge associated with the discontinued operations (in thousands):

|                             
|-----------------------------
|Pre-tax charge               
|Non-cash adjustments         
|Cash payments                
|                             
|Balance at September 30, 2006
|                             
|Pre-tax charge               
|Non-cash adjustments         
|Cash payments                
|                             
|Balance at December 31, 2006 
|                             
|Pre-tax charge               
|Non-cash adjustments         
|Cash payments                
|                             
|Balance at September 30, 2007
|                             

The
Company has reflected the results of its agricultural implements business as discontinued
operations in the Condensed Consolidated Statements of Operations. Summary results of
operations for the agricultural implements business were as follows (in thousands):

|                                                           
|-----------------------------------------------------------
|September 30,
2006                                         
|Net sales                                                  
|Pretax income (loss) from discontinued operations          
|Pretax income (loss) on disposal of discontinued operations
|Income tax expense (benefit)                               
|                                                           
|Net income (loss) from discontinued operations             
|                                                           

-8-

---

The
assets of the agricultural implements business are reflected as net assets of discontinued
operations in the Condensed Consolidated Balance Sheets and were as follows (in
thousands):

|                                       | September 30, 2007
|-------------------------------------- | ------------------
|Accounts receivable, net               |                   
|Inventories                            |                   
|Property, plant, and equipment, net    |                   
|                                      
|Assets of discontinued operations, net |                   
|                                      

In
the three month period ended September 30, 2007, the Company reclassified property, plant
and equipment totaling $1.3 million from assets of discontinued operations to property,
plant and equipment  net on the Condensed Consolidated Balance Sheets as the result
of a decision to renovate a discontinued manufacturing facility for use as a future
research and development facility.

# Note 4  Income
Taxes

The
income tax provision is determined by applying an estimated annual effective income tax
rate to income before income taxes. The estimated annual effective income tax rate is
based on the most recent annualized forecast of pretax income, permanent book/tax
differences and tax credits.

The
Company and its subsidiaries file income tax returns in the U.S. Federal jurisdiction, and
various state and foreign jurisdictions. Effective January 1, 2007, the Company adopted
FIN 48. In accordance with FIN 48, the Company recognized a cumulative-effect adjustment
of $0.5 million, increasing its liability for unrecognized tax benefits along with related
interest and penalties, and reducing the January 1, 2007 balance of retained earnings.

At
January 1, 2007, the Company had $2.5 million in unrecognized tax benefits, the
recognition of which would have an effect of $2.5 million on the effective tax rate. At
September 30, 2007, the Company had unrecognized tax benefits of $2.8 million, which would
have an effect of $2.8 million on the effective tax rate. The Company does not believe it
is reasonably probable that its unrecognized tax benefits will significantly change within
the next twelve months.

The
Company recognizes accrued interest and penalties related to unrecognized tax benefits in
income tax expense. At January 1, 2007 and September 30, 2007, the Company had accrued
$0.2 million and $0.3 million, respectively, for the potential payment of interest and
$0.5 million for the potential payment of penalties.

As of January 1, 2007 and September
30, 2007, the Company was subject to U.S. Federal income tax examinations for the tax
years 2005 through 2006, and to non-U.S. income tax examinations for the tax years 2004
through 2006. In addition, the Company is subject to state and local income tax
examinations for the tax years 2001 through 2006.

-9-

---

# Note 5  Finance
Contracts Receivable Financing

In
March 2006, the Company entered into an asset securitization facility (the
Securitization Facility) with a financial institution (the Purchaser)
whereby the Company can sell, through a revolving securitization facility, up to $300
million of retail and fleet installment sale contracts (installment sale
contracts or finance contracts receivable). The Securitization Facility
has a final maturity date in March 2009, subject to annual renewal by the Purchaser. Under
the Securitization Facility, the Company sells portfolios of its finance contracts
receivable to a wholly-owned, bankruptcy-remote special purpose subsidiary
(SPE) which, in turn, sells each such portfolio to a wholly-owned
bankruptcy-remote special purpose subsidiary of the SPE. The wholly-owned
bankruptcy-remote special purpose subsidiary of the SPE sells a participating interest in
each such portfolio of finance contracts receivable to the Purchaser (maximum of 90% of
the discounted value of the finance contract receivable portfolio). The Purchaser has no
recourse against the Company for uncollectible finance contracts receivable, if any;
however, the Companys retained interest in the portfolio of finance contracts
receivable is subordinate to the Purchasers interest. The Company has retained
collection and administrative responsibilities for each sold portfolio of finance
contracts receivable. The Company incurred one-time transaction costs of $0.7 million in
2006 which were included in other expense in the accompanying Condensed Consolidated
Statement of Operations, related to the implementation of the Securitization Facility.

The
Securitization Facility replaced the previous $150 million revolving securitization
facility the Company terminated in February 2006. The participating interest in finance
contracts receivable that had been sold under the previous securitization facility was
purchased by the Purchaser in March 2006.

The
following summarizes the Companys sales of retail finance contracts receivable
through asset securitization facilities (in thousands):

|                                   
|-----------------------------------
|September 30, 2006                 
|Value of contracts sold            
|Cash received on sales of contracts
|                                   
|Retained interest in contracts sold
|                                   
|Cost of sales of finance contracts 
|                                   

The
Companys retained interest is recorded at fair value, which is calculated based on
the present value of estimated future cash flows and reflects prepayment and loss
assumptions, which are based on historical results. At September 30, 2007, the fair value
of the retained interest was calculated using an interpolated risk-free rate of return of
3.97% based on U.S. Treasury rates, an approximate 17 month weighted-average prepayable
portfolio life and an approximate 1.0% loss rate. Changes in any of these
assumptions could affect the calculated value of the retained interest. A 10% increase in
the discount rate would decrease the fair value of the retained interest by $0.2 million.
A 10% increase in the annual loss rate would decrease the fair value of the retained
interest by $0.9 million. Retained interest of $38.7 million, $20.3 million and $18.2
million was included in current assets at September 30, 2007, December 31, 2006 and
September 30, 2006, respectively, and $21.2 million, $16.8 million and $15.2 million was
included in other assets in the accompanying Condensed Consolidated Balance Sheets at
September 30, 2007, December 31, 2006 and September 30, 2006, respectively.

-10-

---

The
total credit capacity under the 2006 Securitization Facility is $300 million, with an
outstanding note balance of $203.3 million at September 30, 2007. Finance contracts
receivable sold and being serviced by the Company totaled $262.4 million at September 30,
2007. Of the $262.4 million in sold contracts receivable, $20.5 million were greater than
60 days past due at September 30, 2007. Credit losses on contracts sold through the
Securitization Facility during the three and nine month periods ended September 30, 2007
totaled $23,000. The Company received $1.9 million and $1.1 million in service fee income
during the nine months ended September 30, 2007 and 2006, respectively.

In
addition to the sale of finance contracts receivable through the Securitization Facility,
the Company sold finance contracts through limited recourse arrangements during 2007 and
2006. Based on the terms of these sales, recourse to the Company is limited to 5% of the
sold portfolio of finance contracts receivable. Amounts to cover potential losses on these
sold finance contracts receivable are included in the allowance for doubtful accounts. The
following table summarizes the Companys sales of finance contracts receivable
through these arrangements for the nine months ended September 30, 2007 and 2006 (in
thousands):

|                                    | 2007
|----------------------------------- | ----
|Value of contracts sold             |     
|Cash received on sales of contracts |     
|                                   
|Cost of sales of finance contracts  |     
|                                   

At
September 30, 2007, the Company serviced $370.8 million finance contracts receivable of
which $262.4 million, $72.6 million and $13.9 million were sold through the Securitization
Facility, limited recourse arrangements and full recourse arrangements, respectively.

The
finance contracts require periodic installments of principal and interest over periods of
up to 66 months, with interest rates based on market conditions. The Company has retained
the servicing of substantially all of these contracts which generally have maturities of
12 to 60 months.

The
sales of finance contracts receivable were accounted for as a sale in accordance with SFAS
No. 140 Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilitiesa Replacement of FASB Statement No. 125. Sales of
finance contracts receivable are reflected as a reduction of finance contracts receivable
in the accompanying Condensed Consolidated Balance Sheets and the proceeds received are
included in cash flows from operating activities in the accompanying Condensed
Consolidated Statement of Cash Flows.

-11-

---

# Note 6  Inventories

If
all of the Companys inventories had been valued on a current cost basis, which
approximated FIFO value, estimated inventories by major classification would have been as
follows (in thousands):

|                            | September 30, 2007
|--------------------------- | ------------------
|Raw materials and supplies  |                   
|Work-in-process             |                   
|Finished machines and parts |                   
|                           
|Total current cost value    |                   
|Adjustment to LIFO basis    |                   
|                           
|                            |                   
|                           

# Note 7  Product
Warranties and Other Guarantees

In
general, the Company provides warranty coverage on equipment for a period of up to twelve
months. The Companys reserve for warranty claims is established based on the best
estimate of the amounts necessary to settle future and existing claims on products sold as
of the balance sheet date. The Company records warranty expense as a component of selling,
general and administrative expense. While the Companys warranty costs have
historically been within its calculated estimates, it is possible that future warranty
costs could differ from those estimates. The changes in the carrying amount of the
Companys total product warranty liability for the nine month periods ended September
30, 2007 and 2006 were as follows (in thousands):

|September 30, 2007                                     
|-------------------------------------------------------
|Beginning balance                                      
|Accruals for warranties issued during the period       
|Accruals related to pre-existing warranties            
|(including changes in estimates)                       
|Settlements made (in cash or in kind) during the period
|                                                       
|Ending balance                                         
|                                                       

# Note 8  Employee
Retirement Plans

The
Company sponsors two qualified defined benefit pension plans (pension plans)
for certain of its employees. The following table provides disclosure of the net periodic
benefit cost (in thousands):

|                                  
|----------------------------------
|September 30,
2006                
|Service cost                      
|Interest cost                     
|Expected return on plan assets    
|Amortization of prior service cost
|Amortization of net loss          
|                                  
|Net periodic benefit cost         
|                                  

-12-

---

The
Company recorded a $0.7 million pension curtailment loss related to discontinued
operations in 2006 (see Note 3, Discontinued Operations). The Company made
contributions of $0.2 million during the three and nine month periods ended September 30,
2007. The Company does not anticipate making any additional contributions to the pension
plans during 2007.

The
Company maintains an unfunded non-qualified supplemental retirement benefit plan for
certain management employees. The following table provides disclosure of the net periodic
benefit cost (in thousands):

|                                  
|----------------------------------
|September 30,
2006                
|Service cost                      
|Interest cost                     
|Amortization of prior service cost
|Amortization of net loss          
|                                  
|Net periodic benefit cost         
|                                  

The
Company provides post employment benefits to certain retirees, which includes subsidized
health insurance benefits for early retirees prior to their attaining age 65. The
following table provides disclosure of the net periodic benefit cost (in thousands):

|                                     
|-------------------------------------
|September 30,
2006                   
|Service cost                         
|Interest cost                        
|Amortization of transition obligation
|Amortization of net loss             
|                                     
|Net periodic benefit cost            
|                                     

# Note 9 
Shareholders Equity

The
Company maintains equity incentive plans for certain of its directors, officers and key
employees. The Company currently has three primary equity incentive plans: the 2004 Equity
Incentive Plan, the 2000 Equity Incentive Plan and the 1995 Stock Option Plan. The 2004
Equity Incentive Plan, which was adopted in April 2004 and amended in April 2006,
authorizes the granting of awards with respect to up to 737,500 shares of the
Companys common stock. During April 2000, the 2000 Equity Incentive Plan was
adopted, which authorizes the granting of awards with respect to up to 812,771 shares of
the Companys common stock. An award is defined within the 2004 and 2000 Equity
Incentive Plan as a stock option, a stock appreciation right, restricted stock or a
performance share. In April 1996, the 1995 Stock Option Plan was adopted, which authorizes
the granting of options to purchase up to 726,627 shares of the Companys common
stock. These plans provide that options be granted at an exercise price not less than fair
market value on the date the options are granted and that the options generally vest
ratably over a period not exceeding three years after the grant date. The option period
may not be more than ten years after the grant date.

-13-

---

In
the nine month period ended September 30, 2007, the Company awarded 21,000 stock options
to purchase common stock to members of its board of directors. The Company did not award
any stock options in the three months ended September 30, 2007. In the nine month period
ended September 30, 2006, the Company awarded 129,284 stock options to purchase common
stock to certain officers, key employees and directors. The Company did not award any
stock options in the three month period ended September 30, 2006. Awards of stock options
under the plans are subject to certain vesting requirements and are accounted for using
the fair value based method. In the nine months ended September 30, 2007, the Company
awarded 136,087 stock appreciation rights to certain key employees at the fair market
value on the grant date. The Company did not award any stock appreciation rights in the
nine months ended September 30, 2006. The stock appreciation rights can only be settled in
cash and are subject to certain vesting requirements.

In
2007 and 2006, the Company awarded restricted shares under the 2004 Equity Incentive Plan
to certain key employees. Awards of restricted stock under the plan are subject to certain
vesting requirements. There were 26,118 and 26,257 restricted shares awarded in the nine
months ended September 30, 2007 and 2006, respectively, with an average fair market value
of $23.39 and $34.04 per share, respectively. Compensation expense related to restricted
stock awards is based upon the market price at the date of award and is charged to
earnings over the vesting period.

# Note 10  Net
Income Per Share and Comprehensive Income

Basic
net income per common share is computed by dividing net income by the weighted- average
number of common shares outstanding for the period. Diluted net income per common share is
computed by dividing net income by the weighted-average number of common shares and, if
applicable, common stock equivalents that would arise from the exercise of stock options.
A reconciliation of the shares used in the computation of earnings per share follows (in
thousands):

|                              
|------------------------------
|September 30,
2006            
|Basic shares                  
|Effect of options and unvested
|restricted stock              
|                              
|Diluted shares                
|                              

For
the three and nine months ended September 30, 2007, 144,596 options to purchase common
shares were antidilutive and, accordingly, excluded from the effect of options and
unvested restricted stock in the calculation of diluted earnings per share. For the three
and nine months ended September 30, 2006, 129,284 options to purchase common shares were
anti-dilutive.

The components of comprehensive
income are as follows (in thousands):

|                                          
|------------------------------------------
|September 30, 2006                        
|Net income                                
|Foreign currency translation              
|adjustments                               
|Amortization of pension losses, net of tax
|Unrealized (losses) gains, net of tax     
|                                          
|Other comprehensive gain                  
|                                          
|Comprehensive income                      
|                                          

-14-

---

# Note 11  Business
Segments

SFAS
No. 131, Disclosures about Segments of an Enterprise and Related Information,
establishes the standards for reporting information about operating segments in financial
statements.  Historically the Company had two operating and reportable segments,
construction equipment and agricultural equipment.  The products in the historical
agricultural equipment segment included material handling equipment (skid loaders,
telescopic handlers, compact excavators, compact track loaders and all-wheel-loaders) and
agricultural implement products for haymaking, forage harvesting, feedmaking and manure
handling.  In the first quarter of 2006, the Company re-evaluated its operating and
reportable segments in connection with the discontinuation of the manufacturing and
distribution of its agricultural implement business and determined that it now has only
one operating and reportable segment.  Sales of material handling equipment that were
previously included in the agricultural equipment segment and sales that were previously
included in the construction equipment segment are now combined for both internal and
external reporting purposes.

# Note 12  Financial
Instruments

The
Company selectively uses interest rate swaps and foreign currency forward contracts to
reduce market risk associated with changes in interest rates and the value of the U.S
Dollar versus the Euro. The use of derivatives is restricted to those intended for hedging
purposes.

In
September 2007, the Company entered into a series of forward currency contracts
(forward contracts) to hedge a portion of the Companys exposure to
changes in the value of the U.S Dollar versus the Euro as a result of the Euro purchase
commitments. The forward contracts expire between June 16, 2008 and December 15, 2008 and
have a notional amount of 6.0 million ($8.4 million) and contract rates ranging from
1.0:$1.4003 to 1.0:$1.4014. As the contracts are deemed ineffective under the
provisions of SFAS No. 133, Accounting for Derivative Instruments and Hedging
Activities, the Company recorded a current liability and an increase to cost of
goods sold of $0.2 million during the three and nine month periods ended September 30,
2007.

In
2005, the Company entered into an interest rate swap agreement with a third party
financial institution to exchange variable rate interest obligations for fixed rate
obligations without the exchange of the underlying principal amounts. Effective January
2006, under this agreement, the Companys variable to fixed rate obligations are an
aggregate swapped notional amount of $40 million through January 2008. The aggregate
notional amount of the swap decreases to $30 million effective January 2008, $20 million
effective January 2009, $10 million effective January 2010 and expires in January 2011.
The Company pays a 4.89% fixed interest rate under the swap agreement and receives a 30
day LIBOR variable rate. The referenced 30 day LIBOR rate was 5.12% at September 30, 2007.
The variable to fixed interest rate swap is an effective cash-flow hedge. The fair value
of the swap totaled ($164,000) at September 30, 2007 and was recorded on the Condensed
Consolidated Balance Sheets, with changes in fair value included in other comprehensive
income.

-15-

---

# Note 13 
Subsequent Events

On
October 26, 2007, the Companys Board of Directors authorized a stock repurchase plan
providing for the repurchase of up to 1,000,000 shares of the Companys outstanding
common stock in open market or privately negotiated transactions. All treasury stock
acquired by the Company will be cancelled and returned to the status of authorized but
unissued. The plan does not have an expiration date. The Companys Board of Directors
terminated the previous plan which was authorized in September 2001. The Company had
repurchased an aggregate of 227,850 shares of the 500,000 authorized shares.

-16-

---

# Item 2.
Managements Discussion and Analysis of Financial Condition and Results of
Operations

# Results of Operations

# Three Months Ended
September 30, 2007 Compared to Three Months Ended September 30, 2006

# Net Sales

Net
sales in the three months ended September 30, 2007 (2007 third quarter) were
$104.9 million compared to $121.0 million in the three months ended September 30, 2006
(2006 third quarter), a decrease of $16.1 million, or 13%. Net sales were
favorably impacted by continued market share gains and the strength of the international
construction markets during the 2007 third quarter. Sales of the Companys skid
loaders during the 2007 third quarter increased 3% from the 2006 third quarter. In
addition, price increases during 2006 and 2007 accounted for approximately 2.6 percentage
points of net sales increase. These sales increases were offset by a reduction in
telehandler, compact track loader and compact excavator shipments in the 2007 third
quarter of 27%, 43% and 13%, respectively, primarily resulting from weakness in the
domestic construction market.

Of
the Companys total net sales reported for the 2007 third quarter, $33.3 million were
made to customers residing outside of the United States compared with $23.4 million in the
2006 third quarter. The increase in export sales was driven by strong international
markets resulting in a 41% increase in European sales as well as a 50% increase in rest of
world sales.

# Gross Profit

Gross
profit was $24.3 million in the 2007 third quarter compared to $26.4 million in the 2006
third quarter, a decrease of $2.1 million, or 8%. Gross profit as a percentage of net
sales (gross margin) was 23.2% in the 2007 third quarter compared to 21.8% in
the 2006 third quarter. Gross margin in the 2007 third quarter increased by one percentage
point due to the favorable impact the Company continues to realize as a result of its
added supply chain resources and initiatives. The remaining increase over the 2006 third
quarter was the result of favorable product and customer mix, as well as improved product
price realization.

# Selling, General and
Administrative Expenses

Selling,
general and administrative expenses were $15.2 million, or 14.5% of net sales, in the 2007
third quarter compared to $14.3 million, or 11.8% of net sales, in the 2006 third quarter.
The increase in selling, general and administrative expenses in the 2007 third quarter
over the 2006 third quarter primarily reflects planned incremental investments in research
and development projects totaling $0.6 million in the 2007 third quarter.

# Income from Operations

Income
from operations in the 2007 third quarter was $9.1 million, or 8.7% of net sales, compared
to income from operations of $12.1 million, or 10.0% of net sales, in the 2006 third
quarter, a decrease of $2.9 million, or 24%.

-17-

---

# Interest Expense

Interest
expense was $1.3 million in the 2007 third quarter compared to $0.8 million in the 2006
third quarter, an increase of $0.4 million. The increase in interest expense was due to an
increase in the average outstanding debt during the 2007 third quarter compared to the
2006 third quarter (see Financial Condition below for a discussion of changes
in outstanding debt).

# Net Other Expense

The
Company recorded net other expense of $1.2 million and $1.0 million in the 2007 third
quarter and 2006 third quarter, respectively. The increase in other expense was primarily
due to an increase in the loss on the sale of finance contracts receivable in the 2007
third quarter compared to the 2006 third quarter.

# Income from Continuing
Operations

Income
from continuing operations in the 2007 third quarter was $5.0 million, or 4.8% of net
sales, compared to income from continuing operations of $7.4 million, or 6.1% of net
sales, in the 2006 third quarter, a decrease of $2.4 million, or 32%.

# Income (Loss) from
Discontinued Operations, Net of Tax

The
Company recorded income from discontinued operations, net of tax of $52,000 in the 2007
third quarter compared to a loss from discontinued operations, net of tax of $309,000 in
the 2006 third quarter.

# Gain (Loss) on Disposal
of Discontinued Operations, Net of Tax

The
Company recorded $1.3 million of income on the disposal of discontinued operations, net of
tax in the 2006 third quarter. There was no loss on disposal of discontinued operations
for the 2007 third quarter.

# Net Income

The
Company recorded net income in the 2007 third quarter of $5.1 million compared to net
income of $8.3 million in the 2006 third quarter, a decrease of $3.3 million, or 39%.

-18-

---

# Nine Months Ended
September 30, 2007 Compared to Nine Months Ended September 30, 2006

# Net Sales

Net
sales in the nine months ended September 30, 2007 (2007 nine months) were
$355.4 million compared to $382.6 million in the nine months ended September 30, 2006
(2006 nine months), a decrease of $27.2 million, or 7%. Net sales were
favorably impacted by continued market share gains and the strength of the international
construction markets during the 2007 third quarter. Sales of the Companys skid
loaders during the 2007 nine months increased 2% from the 2006 nine months. In addition,
price increases during 2006 and 2007 accounted for approximately 3.6 percentage points of
net sales increase. These sales increases were offset by a reduction in telehandler,
compact track loader and compact excavator shipments in the 2007 nine months of 8%, 32%
and 14%, respectively, primarily resulting from weakness in the domestic construction
market.

Of
the Companys total net sales reported for the 2007 nine months, $101.0 million were
made to customers residing outside of the United States compared with $76.3 million in the
2006 nine months. The increase in export sales was driven by strong international markets
resulting in a 33% increase in European sales as well as a 37% increase in rest of world
sales.

# Gross Profit

Gross
profit was $79.6 million in the 2007 nine months compared to $82.7 million in the 2006
nine months, a decrease of $3.1 million, or 4%. Gross margin was 22.4% in the 2007 nine
months compared to 21.6% in the 2006 nine months. Gross margin in the 2007 nine months
increased by approximately one percentage point due to the favorable impact the Company
continues to realize as a result of its added supply chain resources and initiatives. The
remaining increase over the 2006 nine months was the result of favorable product and
customer mix, as well as improved product price realization.

# Selling, General and
Administrative Expenses

Selling,
general and administrative expenses were $45.8 million, or 12.9% of net sales, in the 2007
nine months compared to $44.5 million, or 11.6% of net sales, in the 2006 nine months. The
increase in selling, general and administrative expenses primarily reflects planned
incremental investments in research and development and information technology projects
totaling $1.9 million in the 2007 nine months.

# Income from Operations

Income
from operations in the 2007 nine months was $33.8 million, or 9.5% of net sales, compared
to income from operations of $38.2 million, or 10.0% of net sales, in the 2006 nine
months, a decrease of $4.4 million, or 12%.

# Interest Expense

Interest
expense was $3.3 million in the 2007 nine months compared to $2.8 million in the 2006 nine
months, an increase of $0.6 million. The increase in interest expense was due to an
increase in the average outstanding debt during the 2007 nine months compared to the 2006
nine months (see Financial Condition below for discussion of changes in
outstanding debt).

-19-

---

# Interest Income

Interest
income was $3.1 million in the 2007 nine months compared to $3.0 million in the 2006 nine
months, an increase of $0.1 million. This increase was primarily due to the increase in
average accounts receivable in the 2007 nine months compared to the 2006 nine months.

# Net Other Expense

The
Company recorded net other expense of $2.6 million and $3.1 million in the 2007 nine
months and 2006 nine months, respectively. The change in net other expense was primarily
due to a $0.7 million reduction in securitization implementation costs in the 2007 nine
months and a decrease in the loss on sale of finance contracts receivable of $0.9 million.
These reductions were offset, in part, by approximately $0.2 million in foreign currency
losses in the 2007 nine months compared to $0.9 million in foreign currency gains in the
2006 nine months.

# Income from Continuing
Operations

Income
from continuing operations in the 2007 nine months was $20.3 million, or 5.7% of net
sales, compared to income from continuing operations of $23.1 million, or 6.0% of net
sales, in the 2006 nine months, a decrease of $2.9 million, or 12%.

# Income (Loss) from
Discontinued Operations, Net of Tax

The
Company recorded a loss from discontinued operations, net of tax of $216,000 in the 2007
nine months compared to a loss from discontinued operations, net of tax of $388,000 in the
2006 nine months.

# Gain (Loss) on Disposal
of Discontinued Operations, Net of Tax

The
Company recorded a $7.8 million loss on the disposal of discontinued operations, net of
tax in the 2006 nine months. There was no loss on disposal of discontinued operations for
the 2007 nine months.

# Net Income

The
Company recorded net income in the 2007 nine months of $20.1 million compared to net
income of $15.0 million in the 2006 nine months. The 2006 nine months net income included
a $7.8 million loss on disposal of discontinued operations noted above.

-20-

---

# Financial Condition

# Working Capital

The
Companys working capital was $228.7 million at September 30, 2007 compared to $201.5
million at December 31, 2006 and $225.0 million at September 30, 2006. The change in
working capital at September 30, 2007 from December 31, 2006 was primarily due to
increases in accounts receivable and retained interest in sold finance contracts, offset
in part, by a reduction in income tax receivable and discontinued operations net assets as
well as an increase in accounts payable. Accounts receivable increased from December 31,
2006 primarily due to increased shipments during the 2007 nine months to national account
customers with longer payment terms, which were primarily driven by continued market share
gains in telehandlers. The current portion of retained interest in sold finance contracts
increased from December 31, 2006 due to an increase in the total portfolio balance of
contracts in the asset securitization facility (the Securitization Facility).
The reduction in other current assets was the result of federal income tax refunds
received in the 2007 nine months. The increase in accounts payable was due to increased
production at September 30, 2007 versus December 31, 2006.

The
change in working capital at September 30, 2007 from September 30, 2006 was primarily due
to an increase in accounts receivable and the current portion of retained interest from
the sale of finance contracts. These increases were partially offset by a decrease in
assets of discontinued operations and an increase in short term debt obligations. Accounts
receivable increased from September 30, 2006 primarily due to increased shipments to
national account customers with longer payment terms, the addition of several new dealers
in the period and decreased retail demand in the North American construction market. The
current portion of retained interest from the sale of finance contracts increased from
September 30, 2006 due to an increase in the total portfolio balance of contracts in the
Securitization Facility. Assets of discontinued operations decreased from September 30,
2006 due to the continued collection on accounts receivable and disposition of inventory
related to the discontinued operations. Short term debt obligations increased from
September 30, 2006 as the Company began issuing commercial paper during the fourth quarter
of 2006. See Debt and Equity below for additional discussion.

# Capital Expenditures

Capital
expenditures for property, plant and equipment during the 2007 nine months were
approximately $4.3 million. The Company plans to make up to $7.0 million of capital
expenditures in 2007, primarily to complete the Yankton, South Dakota manufacturing
facility expansion, enhance manufacturing and information technology capabilities and
maintain and upgrade machinery and equipment.

# Debt and Equity

The
Company maintains a $125 million revolving credit facility (the Facility) with
a syndicate of commercial bank lenders. The credit commitment under the Facility is for a
five-year period expiring October 17, 2011. At any time during the term of the Facility,
the Company has the option to request an increase in the credit commitment under the
Facility to $175 million from the current syndicate of commercial bank lenders or any
other commercial bank lender(s) selected by the Company. Under the terms of the Facility,
the Company has pledged the capital stock of certain wholly-owned subsidiaries which are
all co-borrowers. The Company may borrow up to $25 million under the Facility in a
currency other than the U.S. Dollar. The Company may elect to pay interest on U.S. Dollar
borrowings under the Facility at a rate of either (1) the London Interbank Offered Rate
(LIBOR) plus 0.625% to 1.3750% or (2) a base rate defined as the prime
commercial rate less 0.125% to 1.125%. The Companys actual borrowing costs for LIBOR
or base rate borrowings is determined by reference to a pricing grid based on the
Companys ratio of funded debt to total capitalization. Interest on amounts borrowed
under the Facility in currencies other than the U.S. Dollar will be priced at a rate equal
to LIBOR plus 0.625% to 1.375%. As of September 30, 2007, the weighted average interest
rate on Company borrowings outstanding under the Facility was 5.79%.

-21-

---

The
Facility requires the Company to maintain compliance with certain financial covenants
related to total capitalization, interest expense coverage, tangible net worth, capital
expenditures and operating lease spending. The Company was in compliance with all
covenants as of September 30, 2007.

Borrowings
under the Facility were $35.3 million, $24.7 million and $49.8 million at September 30,
2007, December 31, 2006 and September 30, 2006, respectively. Available unused borrowings
under the Facility were $39.7 million, $75.1 million and $75.2 million at September 30,
2007, December 31, 2006 and September 30, 2006, respectively. Available borrowings at
September 30, 2007 and December 31, 2006 were reduced by $50.0 million and $25.0 million,
respectively, of outstanding commercial paper.

During
the fourth quarter of 2006, the Company began to issue commercial paper through a
placement agent to fund a portion of its short term working capital needs. The Company had
the ability to sell up to $25.0 million in commercial paper under this arrangement. In
April 2007, this arrangement was expanded to give the Company the ability to sell up to
$50.0 million in commercial paper. The Companys commercial paper program is backed
by the credit commitment under the Companys revolving credit facility. At September
30, 2007, the Company had $50.0 million of short term commercial paper outstanding at a
rate of 5.67% compared to $25.0 million outstanding at December 31, 2006 at a rate of
5.45%.

In
addition, the Company has access to a 2.5 million committed foreign short-term
credit facility. There were no borrowings outstanding under this facility at September 30,
2007.

The
Company believes it has adequate capital resources and borrowing capacity to meet its
projected capital requirements for the foreseeable future. Requirements for working
capital, capital expenditures, pension fund contributions and debt maturities in fiscal
2007 will continue to be funded by operations and the Companys borrowing
arrangements.

At
September 30, 2007, shareholders equity had increased $27.1 million to $253.9
million from $226.8 million at September 30, 2006. This increase primarily reflects net
income of $24.6 million.

On
October 26, 2007, the Companys Board of Directors authorized a stock repurchase plan
providing for the repurchase of up to 1,000,000 shares of the Companys outstanding
common stock in open market or privately negotiated transactions. All treasury stock
acquired by the Company will be cancelled and returned to the status of authorized but
unissued. The plan does not have an expiration date. The Companys Board of Directors
terminated the previous plan which was authorized in September 2001. The Company had
repurchased an aggregate of 227,850 shares of the 500,000 authorized shares.

-22-

---

# Contractual Obligations

Other
than the changes in the outstanding borrowings, capital commitments and Financial
Accounting Standards Board Interpretation No. 48 liabilities, as described above, there
have been no material changes to the annual maturities of debt obligations, future
minimum, non-cancelable operating lease payments and capital commitments as disclosed in
Managements Discussion and Analysis of Financial Condition and Results of Operations
and Notes 8 and 15, respectively, of Notes to Consolidated Financial Statements in the
Companys Annual Report on Form 10-K for the year ended December 31, 2006 as filed
with the Securities and Exchange Commission.

# Off-Balance Sheet
Arrangements  Sales of Finance Contracts Receivable

The
sale of finance contracts is an important component of the Companys overall
liquidity. In March 2006, the Company entered into an asset securitization facility (the
Securitization Facility) with a financial institution (the
Purchaser) whereby the Company can sell, through a revolving securitization
facility, up to $300 million of retail and fleet installment sale contracts
(installment sale contracts or finance contracts receivable). The
Securitization Facility has a final maturity date in March 2009, subject to annual renewal
by the Purchaser. Under the Securitization Facility, the Company sells portfolios of its
finance contracts receivable to a wholly-owned, bankruptcy-remote special purpose
subsidiary (SPE) which, in turn, sells each such portfolio to a wholly-owned
bankruptcy-remote special purpose subsidiary of the SPE. The wholly-owned
bankruptcy-remote special purpose subsidiary of the SPE sells a participating interest in
each such portfolio of finance contracts receivable to the Purchaser (maximum of 90% of
the discounted value of the finance contract receivable portfolio). The Purchaser has no
recourse against the Company for uncollectible finance contracts receivable, if any;
however, the Companys retained interest in the portfolio of finance contracts
receivable is subordinate to the Purchasers interest. The Securitization Facility
replaced the previous $150 million revolving securitization facility the Company
terminated in February 2006. The participating interest in finance contracts receivable
that had been sold under the previous securitization facility was purchased by Purchaser
in March 2006. At September 30, 2007, the Company had available unused capacity of $96.7
million under the Securitization Facility.

In
addition to the Securitization Facility, the Company has arrangements with multiple
financial institutions to sell its finance contracts receivable with 5% limited recourse
on the sold portfolio of retail finance contracts. The Company continues to service
substantially all contracts, whether or not sold. At September 30, 2007, the Company
serviced $370.8 million finance contracts receivable of which $262.4 million, $72.6
million and $13.9 million were sold through the Securitization Facility, limited recourse
arrangements and full recourse arrangements, respectively. It is the intention of the
Company to continue to sell substantially all of its existing as well as future finance
contracts through an asset securitization program or limited recourse arrangements. The
Company believes that it will be able to arrange sufficient capacity to sell its finance
contracts for the foreseeable future.

# Critical Accounting
Policies and Estimates

There
are no material changes to the information provided in response to this item as set forth
in the Companys Annual Report on Form 10-K for the year ended December 31, 2006 as
filed with the Securities and Exchange Commission.

-23-

---

# Forward-Looking
Statements

Certain
statements included in this filing are forward-looking statements intended to
qualify for the safe harbor from liability established by the Private Securities
Litigation Reform Act of 1995. All statements other than statements of historical fact are
forward-looking statements. When used in this filing, words such as the Company
believes, anticipates, expects, estimates
or projects or words of similar meaning are generally intended to identify
forward-looking statements. These forward-looking statements are not guarantees of future
performance and are subject to certain risks, uncertainties, assumptions and other
factors, some of which are beyond the Companys control, that could cause actual
results to differ materially from those anticipated as of the date of this filing. Factors
that could cause such a variance include, but are not limited to, those risk factors cited
in the Companys filings with the Securities and Exchange Commission, any adverse
change in general economic conditions, unanticipated changes in capital market conditions,
the Companys ability to implement successfully its strategic initiatives (including
cost reduction initiatives), unanticipated expenses associated with the discontinuance of
the Companys agricultural implement lines, market acceptance of newly introduced
products, unexpected issues related to the pricing and availability of raw materials
(including steel) and component parts, unanticipated difficulties in securing product from
third party manufacturing sources, the ability of the Company to increase its prices to
reflect higher prices for raw materials and component parts, the cyclical nature of the
Companys business, the Companys and its customers access to credit,
competitive pricing, product initiatives and other actions taken by competitors,
disruptions in production capacity, excess inventory levels, the effect of changes in laws
and regulations (including government subsidies and international trade regulations),
technological difficulties, changes in currency exchange rates or interest rates, the
Companys ability to secure sources of liquidity necessary to fund its operations,
changes in environmental laws, the impact of any strategic transactions effected by the
Company, and employee and labor relations. Shareholders, potential investors, and other
readers are urged to consider these factors in evaluating the forward-looking statements
and are cautioned not to place undue reliance on such forward-looking statements. The
forward-looking statements included in this filing are only made as of the date of this
filing, and the Company undertakes no obligation to publicly update such forward-looking
statements to reflect subsequent events or circumstances.

-24-

---

# Item 3. Quantitative and
Qualitative Disclosures about Market Risk

There
are no material changes to the information provided in response to this item as set forth
in the Companys Annual Report on Form 10-K for the year ended December 31, 2006 as
filed with the Securities and Exchange Commission.

# Item 4. Controls and
Procedures

# Disclosure Controls and
Procedures

The
Companys management, with the participation of the Companys principal
executive officer and its principal financial officer, has evaluated the Companys
disclosure controls and procedures as of September 30, 2007. Based upon that evaluation,
the Companys principal executive officer and its principal financial officer have
concluded that the Companys disclosure controls and procedures were effective as of
September 30, 2007.

# Changes in Internal
Control Over Financial Reporting

There
was no change in the Companys internal control over financial reporting (as such
term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred
during the three months ended September 30, 2007, that has materially affected, or is
reasonably likely to materially affect, the Companys internal control over financial
reporting.

-25-

---

# PART II  Other
Information

# Item 1A. Risk Factors

There
has not been any material change in the risk factors previously disclosed in the
Companys 2006 Form 10-K for the fiscal year ended December 31, 2006.

# Item 2. Unregistered
Sales of Equity Securities and Use of Proceeds

On
October 26, 2007, the Companys Board of Directors authorized a stock repurchase plan
providing for the repurchase of up to 1,000,000 shares of the Companys outstanding
common stock in open market or privately negotiated transactions. All treasury stock
acquired by the Company will be cancelled and returned to the status of authorized but
unissued. The plan does not have an expiration date. The Companys Board of Directors
terminated the previous plan which was authorized in September 2001. The Company had
repurchased an aggregate of 227,850 shares of the 500,000 authorized shares.

-26-

---

# Item 6. Exhibits

|            |                                                                                   
|----------- | ----------------------------------------------------------------------------------
|Exhibit No. | Document Description                                                              
|10.1        | Amendment No. 4 to Receivables Purchase Agreement dated as of July 13, 2007, among
|            | Gehl Company, Gehl Funding II, LLC, Park Avenue Receivables Company, LLC and      
|            | JPMorgan Chase Bank, N.A.                                                         
|31.1        | Certification of the Chief Executive Officer pursuant to section 302 of the       
|            | Sarbanes-Oxley Act of 2002.                                                       
|31.2        | Certification of the Chief Financial Officer pursuant to section 302 of the       
|            | Sarbanes-Oxley Act of 2002.                                                       
|32.1        | Certification of Periodic Financial Report by the Chief Executive Officer and     
|            | Chief Financial Officer pursuant to section 906 of the Sarbanes-Oxley Act of 2002.

# SIGNATURES

Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned thereunto duly authorized.

|                         |                              
|------------------------ | -----------------------------
|                         | GEHL COMPANY                 
|Date:  November 6, 2007  | By:  /s/ William D. Gehl     
|                         | William D. Gehl              
|                         | Chairman of the Board        
|                         | and Chief Executive Officer  
|                         | (Principal Executive Officer)
|Date:  November  6, 2007 | By:  /s/ Thomas M. Rettler   
|                         | Thomas M. Rettler            
|                         | Vice President and           
|                         | Chief Financial Officer      
|                         | (Principal Financial and     
|                         | Accounting Officer)          

-27-

---

# GEHL COMPANY

# INDEX TO EXHIBITS

|            |                                                                          
|----------- | -------------------------------------------------------------------------
|Exhibit No. | Document Description                                                     
|10.1        | Amendment No. 4 to Receivables Purchase Agreement dated as of July 13,   
|            | 2007, among Gehl Company, Gehl Funding II, LLC, Park Avenue Receivables  
|            | Company, LLC and JPMorgan Chase Bank, N.A.                               
|31.1        | Certification of the Chief Executive Officer pursuant to section 302 of  
|            | the Sarbanes-Oxley Act of 2002.                                          
|31.2        | Certification of the Chief Financial Officer pursuant to section 302 of  
|            | the Sarbanes-Oxley Act of 2002.                                          
|32.1        | Certification of Periodic Financial Report by the Chief Executive Officer
|            | and Chief Financial Officer pursuant to section 906 of the Sarbanes-Oxley
|            | Act of 2002.                                                             

-28-