(Updates with closing share price in fifth paragraph.)
Feb. 27 (Bloomberg) -- Joy Global Inc., the world’s biggest producer of underground mining machines, said signs of improvement in commodities demand will lead to more spending by its customers.
“The company believes that the increasing number of key indicators that are turning positive will begin to increase commodity demand and provide support for prices,” the Milwaukee-based company said today in its first-quarter earnings statement. “Although timing is uncertain, this will lead to additional approvals for mine expansions.”
Joy cited year-on-year Chinese economic growth and increases in coal imports there and in India, Japan and Europe. The company also said the U.S. coal market will see gains in 2013 after a decline in production last year, rising global steel output will help demand for metallurgical coal, and copper demand could “surprise to the upside.”
“Although there are growing examples that commodity fundamentals are beginning to turn positive, we expect some delay in translating that into increased mine expansion projects due to a much more cautionary stance on capital deployment by our customers,” Chief Executive Officer Mike Sutherlin said in the statement.
Joy rose 5.8 percent to $63.45 at the close in New York.
The company maintained its forecast for full-year earnings of $5.75 to $6.35 a share and sales of $4.9 billion to $5.2 billion.
First-quarter profit excluding acquisition costs and other one-time items was $1.31 a share, exceeding the $1.14 average of 20 analysts’ estimates compiled by Bloomberg. Revenue rose 1.2 percent to $1.15 billion, beating the $1.08 billion average of 12 projections. The fiscal quarter ended Jan. 31.
Refined copper demand fell short of production by about 250,000 metric tons last year and the shortage in 2013 will be smaller because of increased mine supply, Joy said.
--Editors: Jessica Resnick-Ault, Steven Frank