Joy Global profits rise, but orders drop - The Business Journal of Milwaukee:

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Milwaukee-based Joy Global JOYG) reported net income for the quarterended Jan. 30 of $85.7u million, or 83 cents per a 21 percent increase comparedwith $71.q million, or 65 cents per share, for the same periofd a year ago. Analysts polled by Thomsoh First Call expected a consensus of 76 cents per Net sales for the quartee increased 18 percentto 754.9 million from $640.3 While revenue increased because of strong commodity pricexs and the effect of acquisitions, bookings plungeds 38 percent to $538 millio from $870 million in the quarter last year. Nearl half of that drop came from canceled said president and CEOMike Sutherlin.
"Wse incurred $161 million of cancellations in the firsg quarter as we continue to work with our customers to adjustf to the realities of our marketes in ways that best enhanc ethe short- and long-term valuw of our business," Sutherlin said. Declining commodity demand is puttinf pressure on mine production volumes andcommoditgy prices, while still ahead of last year, have givejn up much of their 2008 the company said.
In response to the deterioratiny economy, Joy Global said it has instituted hiring freezee and has implemented strict cost controlss and management of its supply The company also believes that the downturn in orderws will persist beyond its current backlogof orders, and so it plans to reduce the scale and scope of the busineses during 2009 to more appropriately match the marke conditions it expects in 2010. In an analyst note & Co.'s Robert McCarthy wrote that Joy Global management is planning fora "potentially sever e and protracted downturn." The firm is respondingh with significant efforts to reducse costs that would include "facility closures/consolidations.
" Thos e efforts appear likely to begin in the the secon d half of 2009, McCarthg wrote. McCarthy maintained Joy's outperform rating, noting that the company's aftermarket business remains stronb and that despite expectationd of lower revenueduring 2009, operating margin s are expected to hold McCarthy raised his earninga estimate for 2009 to $3.1p from $2.80 per share. In its press release, Joy Globapl reaffirmed its earnings guidance for 2009 of earningaof $3.60 to $4 per share on revenue in the rang of $3.5 billion to $3.7 billion. The company's shares closedd up 11 percentat $17.
55 following Wednesday's earnings but gave back 52 cents of that gain in Thursdayh morning trading, sliding 3 percenyt to $17.03. Joy Global manufactures surfacre mining equipment at itsWest Milwaukee-basedf P&H Mining Equipment unit and undergrounfd mining equipment at its Joy Mininy Machinery division in Warrendale, Pa.