Joy Global Q3 Profit Falls, Results Miss Estimates; Updates FY14 Outlook

(RTTNews) - Mining equipment maker Joy Global Inc. (JOY) reported that its net income for the third quarter of fiscal 2014 fell to $71.29 million from $183.19 million in the third quarter of fiscal 2013. Quarterly earnings per share dropped to $0.71, from $1.71 in the prior year.

Excluding restructuring and pension curtailment charges and net discrete tax benefits, earnings per share for the third quarter totaled $0.80, compared to $1.70 in the prior year. Analysts polled by Thomson Reuters expected the company to report earnings of $0.84 per share for the quarter. Analysts' estimates typically exclude special items.

Operating profit for the third quarter totaled $119 million, compared to $274 million in the prior year.

Excluding restructuring and pension curtailment charges, operating profit for the third quarter of fiscal 2014 totaled $133 million, compared to $278 million in the third quarter of fiscal 2013. The decrease in operating profit, before restructuring and pension curtailment charges, was due to lower sales volumes and lower manufacturing cost absorption partially offset by cost savings from the company's restructuring programs and lower incentive based compensation expense.

Consolidated net sales totaled $875.66 million, down about 34 percent from $1.32 billion last year. Wall Street expected revenues of $934.25 million for the quarter. The latest-quarter net sales were reduced by $10 million from the impact of foreign currency exchange versus the year ago period. When adjusting for foreign currency exchange, sales were down 33 percent compared to the third quarter of last year. Original equipment sales decreased 57 percent and service sales decreased 14 percent compared to the prior year.

With one quarter of the year remaining, and based on a downgraded production profile for U.S. coal and current geopolitical circumstances within Eastern Europe and Russia, the company said it tightening its revenue and earnings guidance for fiscal 2014.

The company now expects fiscal 2014 revenue to be in the range of $3.65 billion to $3.75 billion, and full year earnings in the range of $3.15 to $3.30 per share excluding restructuring and pension curtailment charges and other unusual items. This compared to its previous revenue guidance of $3.6 billion to $3.8 billion and adjusted earnings of $3.10 to $3.50 per share for fiscal 2014. Wall Street currently is looking for fiscal year 2014 earnings of $3.22 per share on annual revenues of $3.76 billion.