The company said profits for the quarter grew to $189 million, or $1.53 per share, compared with $31 million or $0.25 per diluted share for the same period in 2005.
Bookings in the quarter grew by 13% to $606 million, reflecting the strength in most markets; and aftermarket orders again exhibited solid double-digit growth, increasing by 17% in total.
Chairman, president and CEO of Joy Global John Hanson said the company’s strong operating performance in the quarter reflected the “continued vigour” witnessed in the cycle, as well as its successful efforts in meeting the rising demands of customers.
He said original equipment orders fell slightly from the third quarter of last year due to reduced coal demand caused by mild weather conditions over the past few quarters – however Hanson suggested this would be a “short-term phenomenon”
“We see no peak in demand for our products and services and, with the exception of short-term softness in the US coal markets, our customers’ commodity markets continue to exhibit robust conditions,” Hanson said.
Working capital rose by $45 million in the quarter, partially due to normal growth in the business as the cycle continues.
However, Hanson said, “The ability to maintain desired levels of inventory is being hampered by continuing supply chain constraints.”
Looking forward, the company said the long-term supply and demand situation for coal in the US is favourable, as new coal-fired power plants continue to be announced and new coal technology projects are undertaken.
Growth conditions also remain strong for the company in China, Russia and Canada, with new orders and revenues on the up.
“All of these long-term growth opportunities translate into a greater need to increase overall capacity,” said Mike Sutherlin, who is set to succeed John Hanson as CEO.
“I believe that service levels rather than backlogs drive our business, and therefore, the objective of our capital expansion program is to reduce original equipment order lead times to less than a year. This will allow us to better meet the needs of our customers and the expectations of our shareholders.”
Hanson projected that revenues in the next 12 months will grow in the range of 16-29%, translating into total 12-month revenues in the range of $2.65-2.95 billion.
