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Epiroc makes sound start

On April 25 Epiroc took its first steps as a company in its own right. The day before Atlas Copco shareholders had voted to calve it off. Its business is already heading in the right direction.
Epiroc makes sound start Epiroc makes sound start Epiroc makes sound start Epiroc makes sound start Epiroc makes sound start

Staff reporter

According to Atlas Copco's financial figures for the three months to March 31, Epiroc enjoyed an 18% growth in orders received compared with the same period in 2017.

It also had an 11% jump in revenues to 8.2 billion Swedish krone (US$945 million) and a 7% rise in operating profit to SEK1.5 billion. The reported operating profit includes SEK95 million in one-time costs related to the split and the listing process.

The demand for equipment and service continued to increase, with organic order intake up 22%.

The strong order growth was primarily related to miners starting to expand investments in or adjacent to existing mines. That had a particularly positive impact on rock drilling equipment sales for surface applications.

The reported operating margin was 18.4%, down from the 19.1% for the same time last year.

That margin was negatively affected by currency and one-off costs related to the split and listing process. Those costs equated to 1.2% of revenues.

During the quarter Epiroc introduced a line of diamond coring tools.

The new bits cover a wider range of applications, which means fewer bit types than before are needed, making it easier to select the optimal bit for the job. This helps drillers improves productivity and helps drilling contractors reduce the risk of failing to meet deadlines.

Epiroc also bought Australian company Hy-Performance Fluid Power, which remanufactures, services and repairs hydraulic components for drill rigs.

Hy-Performance Fluid Power had annual revenues of SEK50 million in the 2016-17 financial year.

Atlas Copco's share price was up 3.9% early today at SEK346, giving the company a market capitalisation of SEK412 billion.