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UPDATE 1-Atlas Copco profit beats forecast as growth comes surging back
April 26, 2017 / 9:59 AM / 7 months ago

UPDATE 1-Atlas Copco profit beats forecast as growth comes surging back

* Q1 operating profit 5.71 bln SEK vs mean forecast 5.31 bln

* Q1 order intake 31.7 bln SEK vs 28.1 bln forecast

* Shares rise 2 pct after results

* Sees improving demand in Q2 (Adds background, detail, shares, CEO comment)

STOCKHOLM, April 26 (Reuters) - Compressor and mining gear maker Atlas Copco beat forecasts for quarterly profit and order intake on Wednesday, boosted by strong growth in its mining and industrial businesses, and said it expected demand to improve further.

Many engineering firms have struggled to grow in recent years as weak commodity prices have squeezed mining investments and global industrial demand more broadly.

But firming prices for metals and crude oil last year and an improving backdrop for industrial demand have lately fuelled a pick up in growth for engineering firms such as Atlas Copco.

The Swedish company said first-quarter earnings before interest and tax rose to 5.71 billion crowns ($651 million) from 4.17 billion in the same period last year, ahead of a mean forecast for 5.31 billion crowns in a Reuters poll of analysts.

Atlas, whose products include vacuum pumps, industrial power tools and assembly systems, reported its biggest jump in order intake since 2011, with bookings rising to 31.7 billion crowns, a like-for-like rise of 18 pct, beating a 28.1 billion forecast.

“We see a positive trend in all sectors of our business,” Chief Executive Ronnie Leten said in a statement.

The strongest rise in like-for-like order intake was recorded in the group’s newly established Vacuum Technique business area, up 33 percent year-on-year, followed by its mining business, where bookings rose 28 percent.

The vacuum business is driven by strong demand from customers in the semiconductor industry.

Atlas shares were up 2.3 percent at 0950 GMT, taking their year-to-date rise to 21 percent. The stock had climbed earlier this week on the back of forecast-beating results from Nordic mining gear rivals Sandvik and Metso.

$1 = 8.7675 Swedish crowns Reporting by Johannes Hellstrom and Niklas Pollard; Editing by Mark Potter

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