Joy Global Announces Fourth Quarter and Year-End Results

Joy Global Inc., has reported its fourth quarter and full year fiscal 2011 results.

Fourth quarter bookings increased 33% to $1.4 billion in fiscal 2011, compared to the fourth quarter of last year. Operating income increased 31% to $296 million on a revenue increase of 27% to $1.3 billion. Income from continuing operations was up 33% to $195 million, or $1.83 per fully diluted share, compared to income from continuing operations of $146 million, or $1.39 per fully diluted share, for last year's fourth quarter. Earnings per share were reduced by $0.07 in the quarter and $0.18 for the full year by acquisition transaction costs and excess purchase accounting attributable to the LeTourneau Technologies, Inc. (LeTourneau) acquisition.

Fourth Quarter and Full Year Highlights

"Our fourth quarter was a good finish to an exceptional year," says Mike Sutherlin, President and Chief Executive Officer. "Bookings were strong as our customers continue to move ahead with mine expansion projects. Sales were up almost 18% from last year and exceptional operating leverage delivered margins of almost 23%, excluding the impact of acquisition related activities."

"The strong fourth quarter performance enabled us to deliver a record year in most categories. Bookings for the year were up over 40%, and allowed us to grow sales by more than 20% and still carry strong backlogs into fiscal 2012. Even after funding this strong growth, we generated $500 million in cash from operations in fiscal 2011. Operating margins for the year were 21%, including all acquisition costs. In fact, margin improvement was essentially the same with or without the acquisition activity, as LeTourneau's five months of reported results all but covered the costs related to all three transactions. This demonstrates the continued operational efficiency of our core businesses, and the positive contribution of the LeTourneau loader product line from day one," says Sutherlin.

Fourth Quarter Operating Results

The 33% increase in fourth quarter bookings included $116 million from LeTourneau. Orders for the core Joy underground and P&H surface mining equipment business increased 22% over the fourth quarter of last year, with original equipment orders up 25% and orders for aftermarket parts and services up 20%.

Original equipment orders were up as mining companies continue to increase production at existing mines and bring new mines on line. The increase in aftermarket orders resulted from a larger operating fleet of equipment, increased mining production volume and more difficult mining conditions. The increase in orders is net of a $59 million reduction in fourth quarter orders due to a stronger U.S. dollar than in the fourth quarter of last year.

Orders for underground original equipment exhibited typical lumpiness, with a 24% decrease from last year's fourth quarter, while the increase in orders for underground aftermarket parts and services was unusually strong at 24%. The decline in original equipment bookings was almost all attributable to the adjustment of beginning backlog for exchange rate movements. The backlog adjustment was particularly significant due to the large amount of underground backlog currently denominated in Australian dollars. Overall, orders for the Joy underground mining machinery business were reduced by 6% due to the unfavorable impact in foreign exchange rates, and were up 3% net of these adjustments. Orders for underground original equipment increased in the United States and Eurasia, but were down in Australia, China and South Africa due to the timing of projects. The increase in aftermarket bookings was strongest in China, Eurasia and the United States.