Dec. 14 (Bloomberg) -- Joy Global Inc., the maker of P&H and Joy mining equipment, fell the most in more than 11 weeks after projecting that demand for commodities will remain slow in the near term.
Joy Global dropped $7.29, or 8.6 percent, to $77.26 at 10:33 a.m. in New York. The shares earlier fell as much as 9.5 percent, the biggest intraday decline since Sept. 22.
Net income rose 18 percent to $172.3 million, or $1.61 a share, in the quarter ended Oct. 28, from $146.3 million, or $1.39, a year earlier, the Milwaukee-based company said today in a statement. Sales rose 27 percent to $1.34 billion from $1.05 billion, lower than the $1.35 billion average of 11 estimates compiled by Bloomberg.
“Management expects sluggish growth until the global macro environment improves with customers focused on strategic expansion plans and lower cost producers prevail over higher cost competitors,” Ann Duignan, a New York-based analyst at JPMorgan Chase & Co. who has a “neutral” rating on the shares, said in a report today. “We would expect the stock to be under pressure at least until the conference call.”
Commodity demand is connected to economic trends, and slowing global growth is tempering demand, the company said in the statement.
‘More Moderate Rate’
“We expect demand to grow at a more moderate rate in 2012, and our focus will be on long-term growth and efficiencies,” Chief Executive Officer Mike Sutherlin said in the statement. “Consistent with the outlook of current sluggishness leading to the return of strong growth, we will continue to move ahead with our capacity upgrades and expansion plans to meet the long-term needs of our customers.”
Recent destocking of commodities such as copper and coal have reduced import demand by China and India and will set the stage for eventual restocking, Sutherlin said.
Excluding expenses related to the purchase of LeTourneau Technologies Inc., which Joy acquired in June, and other items, earnings were $1.90 a share, topping the $1.86 average of 18 estimates compiled by Bloomberg.
(Joy will hold a conference call at 11 a.m. New York time. Dial +1-888-504-7966, passcode 7285398.)
--Editors: Steven Frank, Jessica Resnick-Ault
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