Epiroc braces for new order records after strong Q2

Record orders received, high revenue growth and improved profitability were all part of Epiroc’s financial results for the June quarter as the OEM also made significant progress on its diesel-electric modernization plan. -battery to help electrify the mining sector.

Orders received rose 37% to a record high of SEK 11.07 billion ($ 1.27 billion). This corresponds to organic growth of 45% from the June 2020 quarter, the company said, noting that the three-month period of 2020 had been heavily impacted by the COVID-19 pandemic.

Within this framework, the equipment recorded the strongest organic growth in orders of 76%, supported by a few large orders, such as an order for underground mining equipment from Mexican contractor CoMinVi for use in several mines at across the country.

The aftermarket has also seen strong development, with organic growth of 26% for service and 42% for tools and accessories, noted Epiroc.

On the electrification front, Epiroc also pointed out that the June quarter saw the company win several orders for battery-powered electrical equipment, including one from Ivanplats for the Platreef project in South Africa, while receiving the first orders for its diesel-battery retrofit. Solution. The latter begins with the conversion of the ST1030 diesel loaders to battery-powered electric versions.

Revenue increased 15% to SEK 9.733 billion in the June quarter, while operating profit and operating margin increased 54% and 22.4% to SEK 2.182 billion and 22.4%, respectively.

The period was also characterized by several acquisitions, including the purchase of Kinetic Logging Services in Australia, 3D-P in Canada and MineRP in South Africa. Mining TAG, based in Chile, and Meglab, based in Canada, also entered Epiroc’s fold in early July.

Talk to I AM Right after the results were released, Helena Hedblom, CEO of Epiroc, said the company has seen the automation, digitization and electrification trends seen in the industry accelerate in these regions, between others, since the emergence of COVID-19.

“We see that different regions are ahead in terms of different capabilities,” she said. “We’ve seen a lot around digitalization and automation in Australia, and in Canada, when it comes to electrification, there’s a lot going on. South Africa is strong when it comes to software and on top of that there are regional players serving the sector like Mining TAG.

“We, as Epiroc, can bring our global footprint and help these regional players go abroad and deploy technology globally. “

These acquisitions have seen the company’s staffing contingent increase over the past year. At the end of June, Epiroc said it had 14,569 employees worldwide, up from 13,967 a year earlier, mainly linked to these acquisitions. Indeed, the three companies acquired during the June quarter had a total of 430 employees.

At the end of 2019, before the global outbreak of the pandemic, Epiroc had 14,268 employees on its books.

Although Hedblom acknowledged that much of the increase in staff was due to acquisitions, she said the company was increasing its workforce in “manufacturing, supply chain and service.” .

And looking back at the downsizing done across the company at the height of COVID-19 concerns – which saw layoff notice provided to 425 employees in Sweden and the consolidation of drill tool manufacturing exploration in Canada – Hedblom said the company has since repositioned itself for the type of growth it is currently experiencing.

“When we made the correction last year, we touched on a lot of things related, mainly, to administration and back office. With these acquisitions on board, of course, the majority of employees are people related to technology… software developers and service people to manage the technology in the field.

And, finally, regarding the ability to keep up with record orders, Hedblom said, “We have a very flexible manufacturing setup where we do the final assembly, in-house, and a lot of the pre-assembly is done. by some. external suppliers. This is how we manage – and always have – managed fluctuations in order volumes.

“We can also add more capacity if needed in our assembly lines. We’re not limited to the regional level there; to be able to use the various facilities that we have in the United States and Sweden, in addition to China and India. We can balance this demand between sites.

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