Bucyrus International Inc. Q1 2009 Earnings Call Transcript

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2009-04-24 11:26:14.0

Tags: Commodity Price, Coal, Falloff, Call Transcript, Earnings, Bucyrus International Inc., Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions) Your first question comes from Steve Barger - KeyBanc Capital Markets.

Steve Barger – KeyBanc Capital Markets

Can you talk about your delivery and order expectations in the second quarter so far, maybe the expectations for specifically the aftermarket sales?

Timothy Sullivan

Well, aftermarket book has remained strong. I think the good news is that installed base is going to continue to drive good aftermarket opportunities for us. Even with commodity prices and some uncertainty in commodity prices in the marketplace, people are still operating our machinery on a daily basis, which means that they're still requiring spare parts. So we're very bullish about our aftermarket opportunities in the quarter, and we think that that will continue through the year.

Steve Barger – KeyBanc Capital Markets

And this is kind of region specific but so far in April domestically here coal car loadings are down. I think some of that's weather related, but I also think some utilities have decent stockpiles of coal. Are you seeing any impact on the aftermarket, specifically out of the PRB?

Timothy Sullivan

No, not really but it's quite frankly, it's a little bit more than weather related. We're looking at a power demand around the country off anywhere from 2.5% to 3% and I get the weekly reports on power demand and coal production and coal production's off 2.5% too. So domestically we're probably going to run through a year where production in coal mines is going to be down.

They typically don't shut machines down at least they certainly don't shut down their primary movers like their stripping machines that we produce. So we've not seen a falloff at this point at least and it's early in the year yet, but we haven't seen a falloff in the domestic aftermarket demand.

Steve Barger – KeyBanc Capital Markets

Okay. And shifting gears to the underground, you've been shipping those longwalls to Eastern Europe. Is most of that delivered or is there some left to go in 2Q?

Timothy Sullivan

No, there's a little bit left in Q2 and we should be cleaning up this quarter so it's pretty well done now, at least the first tranche of machines. We're expecting more demand out of that market as there gets a little more stability in the pricing out there.

Steve Barger – KeyBanc Capital Markets

Were there any other big specific orders that are going to ship in 2Q that you had talked about in past quarters?

 

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