Atlas Copco last week reported healthy profitability in the third quarter despite lower revenues for mining equipment. Q313 revenues were SEK 20.6 billion (about U.S. $3.2 billion), a 4-percent decrease from SEK 22.1 billion in the year-ago quarter.
Year-on-year, orders received in the third quarter decreased 6 percent organically to SEK 19.4 billion (U.S. $3.1 billion) from SEK 21.4 billion. The operating profit was mainly affected by lower mining equipment volumes and currency changes, and reached SEK 4.2 billion (U.S. $661.9 million) from SEK 4.9 billion, corresponding to a margin of 20.5 percent.
“Demand for industrial equipment was healthy, and the service business continued to develop well,” said Ronnie Leten, president and CEO of the Atlas Copco Group. “Mining equipment demand remained weak.”
In the third quarter, Atlas Copco decided to expand into process vacuum solutions by acquiring Edwards Group Ltd., a U.K.-based market and technology leader. In addition, Atlas Copco acquired Pneumatic Holdings Inc., a U.S. provider of pneumatic light construction tools; Dost Kompresör, a distributor and service provider of compressors in Turkey; and Synatec, a Germany-based company which provides quality improvement solutions mainly to the automotive industry.
“We are strongly focused on boosting customer productivity by being on the forefront of product innovation and service,” Leten said. “It’s more important than ever.”
In the near term, the overall demand for Atlas Copco’s products and services is expected to remain at the current level.
Atlas Copco is an industrial group with world-leading positions in compressors, expanders and air treatment systems, construction and mining equipment, power tools and assembly systems.