The company reported total operating profit of $85.2 million for the three months to January 31,compared to the $221.2 million for the previous corresponding period.
“While comparison with the first quarter of fiscal 2013 is difficult, I am pleased with our team's execution against plan in what is expected to be our slowest quarter of the fiscal year,” Doheny said.
“During the quarter we continued to move forward on our cost-reduction programs, which will help mitigate the impact from lower volumes during the year.
“In addition, our continued execution of operational excellence and One Joy Global initiatives will position us well when market demand increases and provides us with the ability to generate improved leverage on future growth opportunities.”
Bookings for underground mining machinery fell 25% in comparison to the first quarter of last year.
Original equipment orders decreased 52% compared to the prior year, with falls in all regions except Eurasia, where the first low-seam longwall system was booked in the current quarter.
Service orders increased 2% compared to the prior year, led by stronger component and rebuild activity in North America and Eurasia partially offset by declines in all other regions.
Orders for underground mining machinery were reduced by $46 million for the impact of foreign exchange compared to the first quarter of last year.
“While the economic outlook is improving and should provide some demand catalyst, commodity oversupply and a depressed pricing environment are straining miner cash flows and slowing capital expenditures,” Doheny said.
“Commodity prices remain range bound and in some cases below marginal costs requiring further supply curtailments to balance the market. While these conditions make it difficult to predict the exact timing, the ability to delay rebuilds and service on equipment in most regions appears to be nearing a conclusion.
“Our service bookings in the first quarter increased year-over-year for the first time since the third quarter of 2012. As demand for commodities improves and supply cuts take hold, we expect our service business to follow the general increase in global commodity production.
“In China, we continue to focus on our local China products incorporating Joy technology and developing superior products against local competitive equipment.
“We are also leveraging our China supply chain in developing cost reduced products for the local China market and selective export markets.
“Despite the downturn, we continue to invest in new product innovations to solve our customer's challenges. This quarter we won an order for our new high productivity low seam longwall system.
“This longwall system incorporates the latest features of automation contributing to higher productivity, lower cost per tonne and improved safety.”
