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Epiroc Q3 tops forecast, near-term demand seen stable

Swedish mining gear maker Epiroc on Thursday reported third-quarter earnings ahead of market expectations and strong order intake as it recovered from a pandemic-led hit in the previous quarter.

Operating profit 1.82 bln SEK vs 1.71 analysts' forecasts

Organic order intake up 10% year-on-year

Sees stable near-term demand

Adds background, detail, CEO comment, analyst comment

STOCKHOLM, Oct 23 (Reuters) - Swedish mining gear maker Epiroc EPIRa.ST on Thursday reported third-quarter earnings ahead of market expectations and strong order intake as it recovered from a pandemic-led hit in the previous quarter.

Epiroc, one of the world's top suppliers of underground mining equipment, said demand had improved from the second quarter with help from more moderate COVID-19 restrictions, and it forecast demand would remain stable in the near term.

"We achieved organic order growth and I am pleased to see the strong development in our service business and that our customers took decisions to invest," Epiroc CEO Helena Hedblom said in a statement.

Operating earnings at the firm dropped to 1.82 billion Swedish crowns ($207.17 million) from 1.93 billion a year earlier, but beat the 1.71 billion average analyst forecast according to Refinitiv data.

Order intake in the quarter was 9.37 billion crowns, up 10% on an organic basis, with good growth in both its equipment and service business.

"The release is clearly better than expected on orders and we would expect to see the shares higher on the open," analysts at JP Morgan said in a research note.

Last week, top Epiroc rival Sandvik SAND.ST reported a 2% quarterly organic order rise for its Mining and Rock Technology business.

Epiroc also said its board proposed a second dividend of 1.20 crowns per share, taking total dividends during the year to 2.40 crowns.

($1 = 8.7851 Swedish crowns)

(Reporting by Supantha Mukherjee and Johannes Hellstrom; editing by Uttaresh.V)

((supantha.mukherjee@thomsonreuters.com; +46 70 721 1004; Reuters Messaging: supantha.mukherjee.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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