Joy Global net sales increased 37% to $US523 million, while operating income came in at $US73 million. The strong performance was attributable to dramatic increases in the mix of original equipment shipments and new orders of $US540 million.
“Both underground and surface mining businesses continue to deal with significant supply chain constraints, reflected by a number of shipments that were pushed into the fourth quarter,” Joy chief John Hanson said.
Joy said under the Mining Machinery umbrella, supply constraints in specialty steel were easing somewhat, although prices remained firm. Areas of restricted supply include castings, fabrications, bearings and other purchased components.
“Fabrication and casting constraints are expected to lessen in the fourth quarter, and significant efforts are being made to ensure customers’ requirements are met, particularly in aftermarket parts and services where service levels have remained high,” Joy said.
Joy Mining Machinery’s quarter three bookings came in at $US328 million, down 15%, due to a slump in roof support orders.
The company said current market conditions, both domestic and international, remained strong, with lead times lengthening to more than six months for equipment rebuilds, and 12 months or more for most original equipment products.
Joy has taken steps to alleviate its supply chain constraints, including forming a new service centre in Lebanon, Kentucky, expected to open in the fourth quarter of fiscal 2005. The service centre will include shuttle car and motor centres of excellence. Additional capacity investments include the development of assembly and machining capabilities for armoured face conveyors in China.
“We believe we will continue to experience incoming order rates in excess of quarterly revenues for several quarters, although quarterly bookings will remain volatile. Critical to our success will be the ability to meet the needs of our major customers, alleviate the supply chain constraints restricting revenue growth, and drive increasing operating margins at higher business volumes,” Hanson said.
Joy predicted total revenues for fiscal 2006 at $US2.15 to $US2.35 billion.