At the Company:
Donald C. Roof
EVP and CFO
At Financial Relations Board:
Board also authorizes $400 million in debt borrowings
Milwaukee, WI – September 12, 2006 – Joy Global Inc. (NASDAQ: JOYG), a worldwide leader in high-productivity mining solutions, announced today that the company’s board of directors has authorized an increase in the current $300 million stock buyback program to a level of $1 billion, and extended the program from May 2007 until the end of calendar 2008. The board also authorized debt borrowings in an amount up to $400 million.
“We are very pleased with the actions taken by the board of directors today,” commented John Hanson, chairman, president and CEO of Joy Global Inc. “Our current stock buyback program is nearly completed. Given our continued ability to generate strong free cash flow and our commitment to increasing shareholder value, we believe that reauthorization is appropriate. This increase is consistent with our long-standing strategic approach and will not restrict our ability to implement our growth initiatives.”
“We maintain our belief that a moderate amount of debt in our capital structure is appropriate,” stated Don Roof, CFO. “In this regard, a portion of the proceeds from the planned borrowings will be used to repay revolver advances incurred in connection with the Stamler acquisition, with the bulk available to execute on the increased stock buyback authorization. Going forward, Joy Global expects to retain its investment grade rating. The borrowings authorized will not affect our existing revolving facility and we do not anticipate incurring additional long-term debt in the foreseeable future. We expect to continue generating free cash flow significantly greater than any amounts required to service the planned borrowings.” Forward Looking Statements
The forward-looking statements in this press release are based on our current expectations and are made only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect new information. We cannot assure you the projected results or events will be achieved. Because forward-looking statements involve risks and uncertainties, they are subject to change at any time. Such risks and uncertainties, many of which are beyond our control, include, but are not limited to: the duration of the recovery of coal and copper commodity markets; sustained economic growth and stability in China and our continued access to the Chinese market for mining equipment; the cyclical nature of our original equipment businesses and the high costs of our manufacturing operations that can result in the underabsorption of manufacturing expenses; delays in finalizing union contracts could lead to work stoppages and other labor problems; increased costs and constraints on the supply of major purchased items such as steel, castings, forgings and bearings can adversely affect profits and revenues; the large size and cost of our products that means that the timing of individual orders and shipments can cause fluctuations in our operating results; our significant international operations are subject to many uncertainties, meaning that a reduction in international sales or unfavorable change in foreign exchange rates could affect our financial results; the highly competitive environment that we operate in means that the actions of our competitors can affect our financial performance; regulations affecting the mining industry or electric utilities may adversely impact demand for our products; our growth may be hindered if we are unable to hire or retain qualified employees; unexpected adverse results in litigation or arbitration may reduce our profits; and other risks, uncertainties and cautionary factors set forth in our public filings with the Securities and Exchange Commission.