Joy Global cut its outlook for 2012 for the second time this year as slowing growth in China and Europe and low natural gas prices in the United States continued to hamper coal demand and in turn demand for mining equipment maker's products, such as giant shovels and draglines.
A milder winter in the United States reduced demand for electricity, and low natural gas prices prompted power producers to move away from coal. Higher hydropower generation in China has also reduced coal demand.
Looking ahead, Joy Global now expects fiscal 2012 adjusted earnings between $7.05-7.20 per share, down from $7.15-7.45 per share, previously. It also cut its 2012 revenue forecast to $5.45-5.55 billion, from $5.5-5.7 billion.
Joy Global's CEO, Mike Sutherlin, stated, "Although the U.S. market has progressed in line with our expectations, the deceleration of China demand has deteriorated international markets more quickly and severely than previously expected."
Shares of the company have been hard hit this year, trading down ~45% since touching a 52-week high in late January.
Joy Global (JOY : NYSE : US$54.67), Net Change: 1.60, % Change: 3.01%, Volume: 11,457,557