STOCKHOLM, Sweden - Citing increased equipment rentals, boosted sales and lowered costs, Atlas Copco reported a second-quarter profit jump of 21 percent.

The industrial machinery manufacturer, which owns Prime Equipment and last year acquired Rental Service Corp., said last week that net income for the second quarter ended June 30 rose to $75 million, or 36 cents a share, from the $60.3 million, or 33 cents a share, reported a year earlier. Pretax profit rose 30 percent to $122.3 million but was less than the $123.3 million expected by analysts.

Second-quarter sales in Atlas Copco's rental division skyrocketed to $360.5 million, almost triple the $130 million reported during the second quarter of 1999, while the division's operating profit vaulted to $50.2 million from $15.8 million. Rental revenue increased despite a 3 percent to 4 percent drop in rental prices during the second quarter.

"The demand for our products remained robust in all regions in the world," said Giulio Mazzalupi, Atlas Copco's president and CEO. "North American demand is still foreseen to improve in spite of signs of a slowdown in some sectors of the economy."

Total second-quarter sales revenue increased to $1.23 billion from $932.6 million a year earlier, and operating profit rose to $166.7 million from $114.9 million.