By Elviira Luoma
(Reuters) -Swedish mining and construction equipment maker Epiroc is expecting “limited impact” from tariffs, its CEO said on Tuesday, after the company reported first-quarter operating profit slightly below market expectations.
CEO Helena Hedblom told Reuters that Epiroc will have to take more actions if the situation escalates, adding that the company is focused on “controlling what we can control in this uncertain geopolitical landscape.”
Epiroc, which makes drill rigs, rock excavation and construction equipment among others, reported quarterly operating profit of 3.09 billion Swedish crowns ($321.2 million), up from 2.76 billion crowns a year earlier.
Analysts, on average, had expected profit of 3.13 billion crowns, per data compiled by LSEG.
Epiroc’s first-quarter order intake increased 17% year-on-year to 16.59 billion crowns.
Organically, orders rose 10%, while its large equipment order levels were higher than in the comparable period, it said.
The company also said it expects near-term underlying mining demand, both for equipment and aftermarket, to remain high, contrasting its weaker construction demand forecast.
“We are closely monitoring market developments and have already started to optimize logistics and distribution flows, leverage our global manufacturing footprint, explore alternative suppliers, as well as discuss potential pricing impact with customers,” Hedblom said in a statement.
“But also on the raw material side that we are sourcing more and more regionally when it comes to the ingoing raw material”, she told Reuters.
Epiroc’s peer Sandvik had signalled a limited margin impact from tariffs earlier in April, but warned of global recession risks ahead, after it missed quarterly earnings estimates.
($1 = 9.6201 Swedish crowns)
(Reporting by Elviira Luoma; Editing by Varun H K)
