Atlas Copco, the Swedish construction machinery manufacturer, has released its interim report (unaudited) for the six months ending June 30 1999. The Atlas Copco Group’s revenue has decreased 2% to $2bn over this period, with profit after financial items also decreasing to $175m.
The Construction and Mining Technique business area consists of five divisions in the following product areas: drilling rigs; rock drilling tools; construction tools; and loading equipment.
Orders received during the period were $373m, down 10% in total and 9% in volume. Good orders for drilling rigs from the construction sector in Europe, primarily Germany, and North America partly compensated for the overall weak market conditions for the business area. Revenues ended at $349m, down 14% in total and 12% in volume. Operating profit decreased $8.8m to $23.2m, corresponding to a margin of 6.6%.
Management foresees a growth in demand in European countries. Demand in North America is expected to develop positively, driven by the continuing trend in the US towards outsourcing for equipment. In South America, poor business conditions are expected to continue due to high interest rates and low activity. For Asia, continuing growth in South Korea is expected, while demand in other Asian countries is expected to be flat at best.
