Stockholm-based engineering group Atlas Copco announced spending and job cuts as a result of weak demand for drill rigs and loaders, in the company's 2013 Q2 report.
Industry-wide spending cuts, project delays and dipping commodities prices have dented demand for Atlas' underground mining gear, but the blow was cushioned slightly by a "thriving services business," Reuters reported Thursday.
The company expects third quarter overall group demand to stabilize.
Atlas is heavily exposed to gold mining, a problem not shared by its major competitor, Sandvik, whose second quarter results arrive tomorrow, Friday, July 19.
Shares in Atlas fell nearly 4% and shares in Sandvik dipped almost 2% by early afternoon GMT.
Q2 report highlights:
- Order intake decreased to MSEK 21 135 (23 263), organic decline of 5%
- Revenues decreased to MSEK 21 843 (23 437), organic decline of 2%
- Operating profit decreased by 10% to MSEK 4 533 (5 028)
- Operating margin at 20.8% (21.5)
- Profit before tax amounted to MSEK 4 279 (4 843)
- Profit for the period was MSEK 3 137 (3 620)
- Basic earnings per share were SEK 2.58 (2.98)
- Operating cash flow at MSEK 3 291 (1 891)