Joy Global earnings slip; outlook cut for rest of year
From Staff Reports
May 30, 2013 at 10 p.m.
Mining equipment maker Joy Global Inc. reported lower second-quarter earnings Wednesday and cut its outlook for the full year, saying it sees no immediate recovery in orders as a decline in commodity prices forces miners to slash capital spending.
The Milwaukee-based company, which employs about 1,000 people at a plant in South Longview, said earnings for the three months ended April 26 fell 15 percent to $181.6 million, or $1.69 per share, from a year ago. Excluding items, the company earned $1.73 per share.
Revenue fell 11.7 percent, to $1.36 billion, as orders fell more than 8 percent.
"Encouraging signs in many areas of the economy have not yet translated to the industrial sector, which is the primary source of commodity demand," said CEO Mike Sutherlin.
Joy cut its earnings forecast for the year to $5.60-$5.80 per share, down from $5.75-$6.35.
The company's customers have cut capital spending by as much as 50 percent in response to lower commodity prices, Joy said. Sales of new equipment slumped 33 percent in the second quarter, driven by weakness in the U.S., where coal producers have struggled to compete as some power utilities switch to less expensive natural gas.
Earlier this month, Joy said it was laying off 50 people from its Longview workforce as part of a product realignment and in response to lagging demand for the wheel loaders it produces in Longview.
Joy shares rose 1 percent to close at $55.61 Wednesday. The company's stock has declined 13 percent this year.