Joy Global Inc.
) reported adjusted earnings of $1.99 per share in the fourth
quarter of fiscal 2012, compared with $1.83 per share in the
fourth quarter of fiscal 2011. The results of the company were 9
cents higher than the Zacks Consensus Estimate of $1.90 for the
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Fiscal 2012 adjusted earnings of Joy Global were $7.18 per share,
compared with $5.92 per share in fiscal 2011. The results of the
company were ahead of the Zacks Consensus Estimate of $7.10 for
the fiscal year.
GAAP earnings per share for the fourth quarter were $1.99 and for
the fiscal were $7.13. The difference between GAAP and operating
earnings in the fiscal year emanated from the impact of
Joy Global reported net sales of $1,594.9 million in the fourth
quarter of fiscal 2012 versus $1,335.3 million reported in the
fourth quarter of fiscal 2011, reflecting year-over-year growth
The actual results were ahead of the Zacks Consensus forecast of
$1,415 million for the fourth quarter.
Joy Global reported net sales of $5,660.9 million for fiscal 2012
versus $4,403.9 million reported in fiscal 2011, which reflected
growth of 28.5%. The actual results for fiscal 2012 were higher
than the Zacks Consensus Estimate of $5,493 million.
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
contribution from the acquired assets also boosted the top line
of the company.
Fiscal 2012 Highlights
Joy Global's operating profit in the fiscal was $1.17 billion
versus $0.9 billion in the year-ago period, reflecting
year-over-year growth of 20.7%. The positive impact from higher
sales volume from the legacy business and contribution from
acquired assets boosted results. The profits were marginally
offset by restructuring costs and an increase in period costs.
Total bookings at Joy Global during the fiscal year were $5.07
billion, down 9.3% from the previous year-end level of $5.59
billion. The 20% decline in orders from Joy Global's legacy
underground and surface businesses led to the decline in total
bookings. However, incremental bookings from LeTourneau and
International Mining Machinery to some extent offset the
The total backlog at the end of fiscal 2012 was $2.6 billion
reflecting a decline of $0.6 billion from the fiscal 2011
Net interest expense in fiscal 2012 was $67 million, up from $24
million in the previous fiscal. The increase stemmed from
Cash and cash equivalents of Joy Global as of October 26, 2012,
were $263.9 million versus $288.3 million as of October 28, 2011.
Cash provided by operating activities during fiscal 2012 was
$463.9 million versus $499.7 million provided in the previous
Capital expenditures were $242 million in fiscal 2012, compared
with $111 million in the prior year. The increase was
attributable to continued investments in global capacity and
aftermarket service infrastructure at the company.
Joy Global expects revenue to range from $4.9 billion to $5.2
billion for fiscal 2013. The company expects fiscal 2013 earnings
per share to range between $5.90 and $6.50.
The company continues to invest in global capacity and efficiency
and has thus allocated $200 million in fiscal 2013 for this
Joy Global competes head-to-head with the industry behemoth
). Caterpillar reported record third quarter 2012 both in terms
of earnings per share (EPS) and revenues. EPS in the quarter was
$2.54, a 49% increase from $1.71 in the prior-year quarter, and
way ahead of the Zacks Consensus Estimate of $2.21.
Revenues upped 5% to $16.4 billion in the quarter, but fell short
of the Zacks Consensus Estimate of $16.7 billion.
Fiscal 2012 has been a transitional year for Joy Global.
Depleting backlogs and decline in orders from some of the key
markets pulled back results, while contribution from acquired
assets boosted performance. Even though the company
surpassed our expectation, the decline in yearly bookings and
total backlog is our major concern.
The increasing use of cheap natural gas for power production in
the domestic market is driving down the demand for coal, which in
turn is lowering demand for mining equipment. In the
international market, the demand from China is yet to recover
fully, while rising costs and a weak pricing environment are
lowering the profitability of mining in Australia.
The aforesaid factors will definitely play a vital role in
determining the prospects of Joy Global, as the company sources a
major portion of its orders from these markets.
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. Joy
Global currently retains a short-term Zacks #4 Rank (Sell