Joy Global Inc.
) reported adjusted earnings of $1.83 per share in the fourth
quarter of fiscal 2011, compared with $1.39 per share in the fourth
quarter of fiscal 2010. The results of the company were 2 cents
lower than the Zacks Consensus expectation of $1.85 for the
Fiscal 2011 adjusted earnings of Joy Global were $5.92 per
share, compared with $4.40 per share in fiscal 2010. The results of
the company were 4 cents higher than the Zacks Consensus
expectation of $5.88 for the fiscal year.
GAAP earnings per share during the fourth quarter were $1.61 and
its fiscal earnings were $5.72. The difference between GAAP and
operating earnings in the quarter and the fiscal year emanated from
the impact of discontinued operation.
Joy Global reported net sales of $1,335.3 million in the fourth
quarter of 2011 versus $1,048.9 million reported in the fourth
quarter of 2010, reflecting a year-over-year growth of 27.3%. The
upside was driven by higher contribution from the Underground
Mining Machinery and Surface Mining Equipment segments, while
eliminations dragged down total revenue marginally.
The actual results were a touch short of the Zacks Consensus
forecast of $1,339 million for the fourth quarter.
Joy Global reported net sales of $4,403.9 million for 2011
versus $3,524.3 million reported in 2010, which reflected a growth
of 25% year over year. The year-over-year increase was due to
strong performance of the Underground Mining Machinery and the
Surface Mining Equipment segments.
The actual results for fiscal 2011 were marginally lower than
the Zacks Consensus expectation of $4,431 million.
Fourth Quarter Highlights
During the quarter under review Underground Mining Machinery as
well as Surface Mining Equipment experienced year-over-year gains
due to higher shipments, while sales were up in all
Joy Global's operating profit in the fourth quarter was $296.3
million versus $226.6 million in the year-ago period, reflecting a
year-over-year growth of 22.2%. The positive impact from
aftermarket sales, higher sales volume, and favorable manufacturing
overhead absorption drove the upside.
Fiscal 2011 Highlights
Total bookings at Joy Global during the fiscal year touched the
$5.59 billion mark, up a significant 44.3% from the previous
year-end level of $3.87 billion. The results were driven by strong
bookings in Australia, South America and U.S.
At fiscal year end, total backlog was $3.3 billion, up $1.5
billion from the prior year. The growth reflects a positive
book-to-bill ratio along with contributions from the LeTourneau
Net interest expense in 2011 was $24 million, up $7 million from
2010 levels. The increase stemmed from acquisition financing.
Cash and cash equivalents of Joy Global as of October 28, 2011,
were $288.3 million versus $815.6 million as of October 29,
Cash provided by operating activities during 2011 was $499.7
million versus $583.5 million provided during the previous year.
The year-over-year decline in cash from continuing operations was
mainly due to growth in inventory and accounts receivable,
partially offset by higher net income and increased customer
Capital expenditure in 2011 was $111 million, higher $38 million
from 2010 levels. The increase was attributable to continued
investments in global capacity and aftermarket service
infrastructure at the company.
Joy Global's projection for fiscal 2012 takes into account the
possible contribution from the acquired LeTourneau mining business,
while the forecast excludes the pending acquisition of IMM.
LeTourneau is expected to contribute $400 million to 2012 revenues
and $0.41 to earnings per share.
Joy Global expects revenue to range from $5.3 billion to $5.5
billion for 2012. The company expects full-year 2012 earnings per
share to range between $7.00 and $7.40.
The company continues to invest in global capacity and
efficiency and has thus allocated $ 200 million in 2012 for this
Joy Global competes head-to-head with the industry behemoth
). Caterpillar's third-quarter adjusted EPS was $1.71, surpassing
$1.22 per share reported in the comparable quarter of 2010. The
company also beat the Zacks Consensus Estimate of $1.59 per
In the reported quarter, Caterpillar's revenues surged 41% year
over year to $15.716 billion from $11.134 billion a year ago. The
result surpassed the Zacks Consensus Estimate of $14.581 billion.
During the quarter, the company experienced a growth in sales for
new equipment and after-market parts.
Despite slightly disappointing results this fiscal, we are
encouraged by the company's strong year-end booking and backlog. We
believe the acquired assets will boost performance
going ahead. Besides, increasing demand for mining equipment
in U.S., China and India would act as catalysts.
Joy Global currently retains a Zacks #3 Rank, which translates
into a short-term Hold rating.
Mining equipment manufacturer and service provider Joy Global
Inc. is based in Milwaukee, Wisconsin. The company caters to its
global consumers and provides manufacturing, distributing and
servicing equipment for surface mining, through its P&H Mining
Equipment division, underground mining, through its Joy Mining
Machinery division and bulk material conveyor systems, through its
Continental Crushing & Conveying division.
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