Joy Global Q2 Profit Falls, Adj. Earnings Top Estimates; Backs FY Outlook

(RTTNews) - Mining equipment maker Joy Global, Inc. (JOY) Thursday reported a sharp decline in second-quarter profit, as sales fell 32 percent, amid challenging market conditions. Adjusted earnings topped analysts' expectations, while revenues missed view. The company also backed its outlook for the full fiscal year.

Looking ahead, the firm said it expects second half performance to be weighted towards the end of the year, rather than spread equally among the remaining quarters.

For the second quarter, the company's net income fell to $73.95 million or $0.73 per share from $181.56 million or $1.69 per share in the previous year.

Excluding unusual items, adjusted earnings per share totaled $0.76, while the firm posted $1.73 per share last year. On average, 22 analysts polled by Thomson Reuters expected the company to report earnings of $0.71 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter dropped 32 percent to $929.73 million from $1.36 billion in the prior year. Wall Street analysts had a consensus revenue estimate of $932.09 million for the quarter.

The company said its recent-quarter net sales were reduced by $35 million due to foreign exchange impact. Adjusted for foreign exchange, sales were down 29 percent.

Original equipment sales fell 58 percent and service sales were down 8 percent from the prior year. Net sales from underground mining machinery decreased 24 percent, and net sales from surface mining equipment decreased 38 percent.

Consolidated bookings declined 7.2 percent to $1.05 billion. Original equipment orders fell 27.1 percent, while service orders increased 7.6 percent from last year.

Backlog at the end of the quarter was $1.6 billion, compared to $1.5 billion at the beginning of the year.

Ted Doheny, president and chief executive officer of the company said, "The continued stabilization of our service business, strong cash generation and a multi-shovel order for the Canadian oil sands were highlights in the quarter. Additionally, the recent closing of the Mining Technologies International Inc. transaction will add to our underground hard rock mining growth prospects."

For fiscal 2014, the company continues to expect adjusted earnings in a range of $3.10 to $3.50 per share, on projected revenues of between $3.6 billion and $3.8 billion. The Street currently is looking for fiscal year 2014 earnings of $3.25 per share, on revenues of $3.75 billion.

JOY closed Wednesday's regular trading at $57.85, down 0.28 percent, on a volume of 1.33 million shares.