Milwaukee-based Joy Global Inc. reported it has acquired French hard rock mining company Montabert S.A.S. from Doosan Holding France S.A.S. for about $124 million.
The deal, completed June 1, was announced Thursday in the mining equipment manufacturer’s fiscal second quarter operating results release. Montabert recorded revenue of about $100 million over the year ending on March 31. The acquisition was funded from cash on hand and a loan from Joy Global’s Revolving Credit Agreement.
“Despite tough markets, we remain committed to taking prudent actions to improve our business during this cyclical downturn and bolster our strategic position to be a first tier supplier to the underground hard rock mining market,” said Ted Doheny, president and chief executive officer of Joy Global. “Montabert specializes in the design, production and distribution of high quality hydraulic rock breakers, pneumatic equipment, drilling attachments, drifters and related parts and tools. This acquisition represents an important step in expanding product and service capabilities for hard rock mining, tunneling and rock excavation, further diversifying the company’s commodity and end market exposures. The Montabert product line will complement our existing fleet of hard rock equipment and leverages our global service center infrastructure providing long-term value to our shareholders.”
Net income for the second quarter was $38.7 million, or 40 cents per share, down from $74 million, or 73 cents per share, in the second quarter of 2014.
Operating income was $70.3 million, down from $125.7 million in the same period a year ago.
Revenue totaled $810.5 million in the quarter, down from $929.7 million in the second quarter of 2014.
The company attributed the decline in revenue to slowed orders on end-market pressure and falling commodity prices.
“The company’s fiscal second quarter results reflect increasing pressure on our end-markets from continued oversupplied conditions and sequentially declining commodity pricing,” Doheny said. “While our operational execution in the quarter was in line with our expectations, the incoming order rate, in particular in the U.S. coal and global copper markets, slowed as customers further reduced capital expenditures and deferred maintenance on their mining equipment fleets. We continue to invest in our service business to respond quickly and more efficiently to our customers’ needs and are taking steps to accelerate the optimization of our global manufacturing and service footprint.”