Joy Global (NASDAQ:JOYG) revealed on Wednesday a stronger-than-expected third-quarter profit on substantially higher bookings for surface mining equipment, and said it plans to spin off the drilling business of a recently-acquired company.
The company plans to sell the drilling products business of its recently acquired subsidiary, LeTournau Technologies to Cameron International for $375 million in cash.
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That deal, which has been approved by both companies board of directors, is subject to regulatory approvals and other customer closing conditions.
The Milwaukee-based maker of mining equipment for the extraction of coal, copper, iron ore and oil sands posted net income for the third quarter of $173.1 million, or $1.64 a share, compared with $118.5 million, or $1.15 a share, in the same quarter last year.
Revenue for the three months ended July 29 was $1.14 billion, up 33.7% from $850 million a year ago, just missing the Streets view of $1.17 billion.
This has been a particularly good quarter for us, said Joy Global CEO Mike Sutherlin in a release. Very good operating leverage on strong sales growth enabled us to deliver another record for operating margin, before the impact of LeTourneau.
Further fueling the results was a 97.9% improvement in surface mining equipment bookings to $732.1 million. Bookings for underground mining machinery climbed 17.1% to $742.9 million.
Looking ahead, the company expressed concerns about slowing growth of the global economy, however it said industry fundamentals will remain strong with the help of strong demand from China, India and other emerging markets.