April 29 (Bloomberg) -- Atlas Copco AB, the world’s largest maker of air compressors, posted first-quarter profit below analysts’ estimates as mining customers reined in investment and European markets slowed.
Net income declined 12 percent to 2.99 billion kronor ($457 million), the company said today in a statement. Analysts expected profit of 3.23 billion kronor, according a Bloomberg survey of 15 estimates. Atlas stock fell as much as 3.7 percent, the biggest intraday decline in three months.
Mining companies including BHP Billiton Ltd., the world’s largest, are holding back investments in new equipment as demand and prices for metals decline. Sandvik AB, the world’s biggest maker of metal-cutting tools, posted a decline in first-quarter profit on April 23 and Peoria, Illinois-based Caterpillar Inc., the world’s biggest maker of mining equipment, cut its 2013 profit forecast the day before.
“Demand for our equipment weakened somewhat as the mining sector and much of the European region continued to struggle,” Chief Executive Officer Ronnie Leten said in a statement.
Sales decreased 9.1 percent to 20.2 billion kronor, missing the 21.4 billion-kronor average estimate.
Atlas Copco said demand for its products and services are expected to remain at current levels in the near term, compared with expectations of a slight decrease three months ago. The reason for the more upbeat outlook is a more positive view on the U.S. and China, Leten said today in a webcast.
Demand in Industrial Technique is seen increasing “somewhat,” while the development in Construction Technique is seen “equal to a bit positive.”
Mining Heading Lower
The mining business is expected to have “slightly lower” demand, Leten said.
“We will most likely have to wait a bit until we see some real new capex coming in place,” Leten said about the mining industry in an interview today. “We will see small, incremental investments instead of big investments taking place.”
Atlas Copco shares were down 1.6 percent to 178.10 kronor as of 3:24 p.m. in the Swedish capital, giving the manufacturer a market value of about 212 billion kronor.
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