Joy Global Lifts Guidance; View Still Murky

MILWAUKEE (TheStreet) -- Joy Global(JOYG Quote), the mining-equipment maker, said today that its profit grew 10% in its fiscal third quarter on strong sales to China. The company also lifted its earnings guidance for the rest of the year.

Shares of the company climbed in pre-market trading Wednesday, changing hands recently at $38.50, up $1.19, or 3.2%, from the previous session's close.

Still, gazing into its crystal ball, Joy Global suggested that the outlook remained almost as murky as ever. The company also seemed to indicate that its strong results in the third quarter may be an anomaly, at least in the near term.

"We continue to be encouraged by more positive signs coming from both the global economy and the commodity markets," said Joy Global boss Mike Sutherlin in the company's press release. "However, it is too soon to determine whether this will lead to recovery or is the start of a period of bumping along the bottom."

Joy Global was more hopeful about overseas mining business than that in the U.S. "Despite an improved outlook for the international markets, we see little opportunity for the U.S. market, especially thermal coal, through 2010."

Because Joy Global expects the pace of new equipment orders to lag behind shipping levels, Joy Global said it expects to eat into its backlog next year. Therefore, the company said, "we continue to see 2010 as a year of lower revenues."

Joy Global still expects to meet its previous revenue guidance for 2009 -- $3.5 billion to $3.6 billion. But because of severe cost-cutting measures, the company raised its earnings per-share forecast for the year. It's now predicting a range between $4 and $4.20, up from an initial target of $3.80 to $4.

The company attributed its strong third-quarter results to China's stimulus package, which served to boost demand for its heavy machinery at mines around the world.