Q2 2024 Epiroc AB Earnings Call Transcript
Key Points
- Epiroc AB (EPIAF) reported strong mining activity with large orders amounting to SEK950 million, up from SEK550 million last year.
- The company completed the acquisition of Stanley Infrastructure and announced the acquisition of ACB+, enhancing its leadership in attachments and quick couplers.
- Epiroc AB (EPIAF) achieved a 6% increase in orders received, corresponding to an organic increase of 1%, driven by mining equipment.
- The company successfully deployed a battery-electric trolley truck system for underground mining, advancing towards zero emissions.
- Epiroc AB (EPIAF) was recognized by TIME Magazine as the world's 95th most sustainable company, highlighting its efforts to reduce emissions.
- The construction market weakened further, negatively impacting the aftermarket business.
- The company's adjusted operating margin decreased to 19.7% from 21.6% last year, due to higher costs and negative mix effects within service.
- Epiroc AB (EPIAF) experienced a 1% organic decrease in revenues, despite a total increase to SEK16.5 billion.
- The tools and attachments segment saw a 6% organic decrease in orders due to weak demand from construction customers.
- The company incurred SEK104 million in restructuring costs and anticipates further employee reductions in the second half of the year.
(audio in progress), and hello, everyone. So starting with the highlights. So the mining activity continued to be strong in the quarter as anticipated, and our large orders amounted to SEK950 million, which is up from SEK550 million last year. And the demand picture within mining is stable at a high level. And there is a lot of business cooking or in other words, the pipeline of potential large orders is solid.
The construction market, on the other hand, weakened further in the quarter and impacting the aftermarket business negatively. In the quarter, we completed the acquisition of Stanley Infrastructure. And we also announced the acquisition of ACB+. Together, we will be a leader within attachments and quick couplers, providing customers with a more complete range of productivity solutions.
Long-term, the construction market is attractive with an anticipated annual growth rate of 4% to 5%, and with attachment used for deconstruction and recycling of steel and copper expected to grow even more. When it comes to
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