Joy Global 10Q 2008 Q3 Quarterly report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED August 1, 2008
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD from to

Commission File number 1-9299

	JOY GLOBAL INC.
	(Exact Name of Registrant as Specified in Its Charter)


Delaware			39-1566457
(State of Incorporation)			(I.R.S. Employer
			Identification No.)

	100 East Wisconsin Ave, Suite 2780
	Milwaukee, Wisconsin 53202
	(Address of principal executive offices)
	(Zip Code)
	(414) 319-8500
	(Registrant’s Telephone Number, Including Area Code)


Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to
such filing requirements for the past 90 days. Yes [ X ] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-
accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b -2 of the
Exchange Act. LARGE ACCELERATED FILER [ X ] ACCELERATED FILER o NON-ACCELERATED FILER o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes [ ] No [ X ]

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest
practicable date.

Class		Outstanding at August 29, 2008
Common Stock, $1 par value		107,782,523

JOY GLOBAL INC.

FORM 10-Q -- INDEX

August 1, 2008

PART I. – FINANCIAL INFORMATION		PAGE No.

Item 1 – Financial Statements (unaudited):
	Condensed Consolidated Statement of Income –
	Quarter and Nine Months Ended August 1, 2008 and July 27, 2007	4

	Condensed Consolidated Balance Sheet – August 1, 2008
	and October 26, 2007	5

	Condensed Consolidated Statement of Cash Flows –
	Nine Months Ended August 1, 2008 and July 27, 2007	6

	Notes to Condensed Consolidated Financial Statements	7 – 29

Item 2 – Management’s Discussion and Analysis of Financial Condition and
	Results of Operations	30 – 39

Item 3 – Quantitative and Qualitative Disclosures About Market Risk		39

Item 4 – Controls and Procedures		39

PART II. – OTHER INFORMATION

Item 1 – Legal Proceedings		40

Item 1A – Risk Factors		40

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds		40

Item 3 – Defaults Upon Senior Securities		41

Item 4 – Submission of Matters to a Vote of Security Holders		41

Item 5 – Other Information		41

Item 6 – Exhibits		41

Signatures		42

Forward-Looking Statements

Certain statements in this report, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements are identified by forward-looking terms such as “anticipate,” “believe,” “estimate,” “expect,” “indicate,” “may be,” “objective,” “plan,” “predict,” “will be,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially from the forward-looking statements. Important factors that could cause our actual results to differ materially from the results anticipated by the forward-looking statements include general economic and industry conditions in the markets in which we operate, risks associated with conducting business in foreign countries, and the risks discussed in Item 1A, “Risk Factors,” of our Annual Report on Form 10-K for our fiscal year ended October 26, 2007, and in other filings that we, from time to time, make with the SEC. Any or all of these factors could cause our actual results and financial or legal status for future periods to differ materially from those expressed or referred to in any forward-looking statement. All subsequent written or oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

PART I. - FINANCIAL INFORMATION

Item 1. Financial Statements

JOY GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENT OF INCOME

(Unaudited)

(In thousands except per share amounts)

				Quarter Ended				Nine Months Ended
				August 1,		July 27,		August 1,		July 27,
				2008		2007		2008		2007

Net sales			$	903,769	$	621,785	$	2,387,231	$	1,811,413
Costs and expenses:
	Cost of sales			657,798		424,896		1,707,135		1,230,485
	Product development, selling and
		administrative expenses		113,488		88,909		322,977		259,772
	Other income			(1,136)		(2,286)		(1,926)		(4,669)

Operating income				133,619		110,266		359,045		325,825
Interest income				3,700		1,188		9,344		5,032
Interest expense				(8,581)		(8,118)		(24,030)		(24,447)
Reorganization items				(135)		(135)		(2,311)		(415)

Income from continuing operations before income taxes				128,603		103,201		342,048		305,995
Provision for income taxes				(15,524)		(30,300)		(86,950)		(95,850)

Income from continuing operations				113,079		72,901		255,098		210,145
Income from discontinued operations, net of taxes				-		-		1,141		-

Net income			$	113,079	$	72,901	$	256,239	$	210,145

Basic earnings per share:
	Income from continuing operations		$	1.04	$	0.67	$	2.36	$	1.89
	Income from discontinued operations			-		-		0.01		-
	Net income		$	1.04	$	0.67	$	2.37	$	1.89

Diluted earnings per share:
	Income from continuing operations		$	1.03	$	0.66	$	2.34	$	1.87
	Income from discontinued operations			-		-		0.01		-
	Net income		$	1.03	$	0.66	$	2.35	$	1.87

Dividends per share			$	0.15	$	0.15	$	0.45	$	0.45

Weighted average shares outstanding:
	Basic			108,495		109,137		108,193		111,079
	Diluted			109,446		110,462		109,230		112,410

JOY GLOBAL INC.

CONDENSED CONSOLIDATED BALANCE SHEET

(In thousands)

				August 1,		October 26,
				2008		2007
				(Unaudited)
ASSETS
Current assets:
	Cash and cash equivalents		$	306,885	$	173,248
	Accounts receivable, net			601,918		560,242
	Inventories			892,613		727,360
	Other current assets			122,987		76,945
		Total current assets		1,924,403		1,537,795

Property, plant and equipment, net				293,742		234,029
Intangible assets, net				328,419		79,716
Deferred income taxes				234,124		248,139
Prepaid benefit cost				14,143		779
Other assets				29,486		34,445
		Total assets	$	2,824,317	$	2,134,903


LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Short-term notes payable, including current portion
		of long-term obligations	$	18,483	$	240
	Trade accounts payable			268,377		199,198
	Employee compensation and benefits			99,829		59,490
	Advance payments and progress billings			465,985		324,102
	Accrued warranties			50,421		49,382
	Other accrued liabilities			126,875		121,127
		Total current liabilities		1,029,970		753,539

	Long-term obligations			546,094		396,257
	Accrued pension costs			179,760		173,559
	Other liabilities			167,336		87,554

		Total liabilities		1,923,160		1,410,909

Shareholders' equity				901,157		723,994

		Total liabilities and shareholders' equity	$	2,824,317	$	2,134,903

JOY GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)

(In thousands)

			Nine Months Ended
			August 1,		July 27,
			2008		2007
Cash flows from operating activities:
Net income		$	256,239	$	210,145
Non-cash items:
	Income from discontinued operations		(1,141)		-
	Depreciation and amortization		55,252		37,297
	Increase in deferred income taxes		(20,543)		(5,581)
	Excess income tax benefit from exercise of stock options		(12,021)		(6,977)
	Change in long-term accrued pension costs		(6,064)		17,111
	Other, net		8,442		(5,280)
Contribution to U.S. qualified pension plan			(32,500)		-
Changes in working capital:
	Decrease (increase) in accounts receivable, net		28,213		(12,971)
	Increase in inventories		(124,731)		(96,076)
	Increase in other current assets		(8,987)		(303)
	Increase (decrease) in trade accounts payable		25,817		(40,549)
	Increase (decrease) in employee compensation and benefits		31,097		(29,373)
	Increase in advance payments and progress billings		131,511		97,354
	Increase in other accrued liabilities		3,883		45,537

Net cash provided by operating activities			334,467		210,334

Cash flows from investing activities:
	Acquisition of businesses, net of cash acquired		(255,244)		(10,601)
	Property, plant and equipment acquired		(56,317)		(43,115)
	Proceeds from the sale of business		9,868		228
	Other, net		289		1,385

Net cash used by investing activities			(301,404)		(52,103)

Cash flows from financing activities:
	Exercise of stock options		18,293		11,869
	Excess income tax benefit from exercise of stock options		12,021		6,977
	Dividends paid		(48,572)		(49,985)
	Purchases of treasury stock		(41,471)		(456,631)
	Issuance of senior notes		-		394,874
	Financing fees		(1,495)		(976)
	Borrowings (repayments) on long-term obligations, net		165,571		(47,388)
	Decrease in short-term notes payable		(3,786)		(5,248)

Net cash provided (used) by financing activities			100,561		(146,508)

Effect of exchange rate changes on cash and cash equivalents			13		5,631

Increase in Cash and Cash Equivalents			133,637		17,354
Cash and Cash Equivalents at Beginning of Period			173,248		101,254

Cash and Cash Equivalents at End of Period		$	306,885	$	118,608

JOY GLOBAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

August 1, 2008

(Unaudited)

1.	Description of Business

Joy Global Inc. is the world's leading manufacturer and servicer of high productivity mining equipment for the extraction of coal and other minerals and ores. Our equipment is used in major mining regions throughout the world to mine coal, copper, iron ore, oil sands and other minerals. We operate in three business segments: underground mining machinery (Joy Mining Machinery or “Joy”); surface mining equipment (P&H Mining Equipment or “P&H”) and Crushing & Conveying (Continental or “CCC”). Joy is a major manufacturer of underground mining equipment for the extraction of coal and other bedded minerals and offers comprehensive service locations near major mining regions worldwide. P&H is a major producer of surface mining equipment for the extraction of ores and minerals and provides extensive operational support for many types of equipment used in surface mining. CCC is a worldwide leader in conveyor systems for bulk material handling in mining and industrial applications and both surface and underground crushing equipment.

2.	Basis of Presentation

The Condensed Consolidated Financial Statements presented in this quarterly report on Form 10-Q are unaudited and have been prepared by us in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission.

In our opinion, all adjustments necessary for the fair presentation on a going concern basis of the results of operations, cash flows and financial position for all periods presented have been made. All adjustments made are of a normal recurring nature.

These financial statements should be read in conjunction with the financial statements and accompanying notes included in our Annual Report on Form 10-K for the fiscal year ended October 26, 2007. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year.

The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual amounts could differ from the estimates.

3.	Borrowings and Credit Facilities

Direct borrowings and capital lease obligations consisted of the following:

		August 1,		October 26,
In thousands		2008		2007

6.0% Senior Notes due 2016	$	247,003	$	246,797
6.625% Senior Notes to 2036		148,369		148,355
Term loan		166,250		-
Capital leases and other		2,955		1,345
		564,577		396,497
Less: Amounts due within one year		(18,483)		(240)

Long-term obligations	$	546,094	$	396,257

We have a $400.0 million unsecured revolving credit facility (“Credit Agreement”) which expires November 10, 2011. Outstanding borrowings bear interest equal to the LIBOR Rate (defined as LIBOR plus 0.5% to 1.25%) or the Base Rate (defined as the higher of the Prime Rate or the Federal Funds Effective Rate plus 0.5%) at our option. We pay a commitment fee ranging from 0.125% to 0.25% on the unused portion of the revolving credit facility based on our credit rating. The Credit Agreement requires the maintenance of certain financial covenants including leverage and interest coverage. The Credit Agreement also restricts payments of dividends or other return of capital based on the consolidated leverage ratio. At August 1, 2008, we were in compliance with all financial covenants in the Credit Agreement and had no restrictions on the payment of dividends or return of capital.

At August 1, 2008, there were no direct borrowings under the Credit Agreement. Outstanding letters of credit issued under the Credit Agreement, which count toward the $400.0 million credit limit, totaled $150 million. At August 1, 2008, there was $250.0 million available for borrowings under the Credit Agreement.

The Continental acquisition was funded in part through a new $175.0 million term loan supplement to our existing Credit Agreement (“Second Amendment”). The Second Amendment calls for quarterly principal payments of 2.5% of the initial term loan through October 31, 2011, at which time the remaining outstanding principal equal to 62.5% of the initial term loan is due. Currently, we have made two quarterly principal payments totaling $8.75 million. Outstanding borrowings bear interest equal to the LIBOR rate which has a weighted average interest rate of 3.35%. As part of the Second Amendment, we have the option to request an increase to the term loan outstanding not to exceed $75.0 million. No changes were made to existing financial covenants.

In November 2006, we issued $250.0 million aggregate principal amount of 6.0% Senior Notes due 2016 and $150.0 million aggregate principal amount of 6.625% Senior Notes due 2036 (“Notes”) with interest on the Notes being paid semi-annually in arrears on May 15 and November 15 of each year, starting on May 15, 2007. The Notes are guaranteed by each of our current and future significant domestic subsidiaries. The Notes were issued in a private placement under an exemption from registration provided by the Securities Act of 1933 (“Securities Act”), as amended. In the 2^nd quarter of fiscal 2007, the Notes were exchanged for similar notes registered under the Securities Act. At our option, we may redeem some or all of the Notes at a redemption price of the greater of 100% of the principal amount of the Notes to be redeemed or the sum of the present values of the principal amounts and the remaining scheduled interest payments using a discount rate equal to the sum of a treasury rate of a comparable treasury issue plus 0.3% for the 2016 Notes and 0.375% for the 2036 Notes.

4.	Shareholders’ Equity

On May 22, 2008, our Board of Directors declared a cash dividend of $0.15 per outstanding share of common stock. The dividend was paid on June 19, 2008 to all shareholders of record at the close of business on June 5, 2008.

Under our share repurchase program, management is authorized to repurchase up to $1.0 billion in shares in the open market or through privately negotiated transactions until December 31, 2008. During the quarter ended August 1, 2008, we repurchased approximately $24.4 million of common stock, representing 353,800 shares. During the nine months ended August 1, 2008, we have repurchased approximately $41.5 million of common stock, representing 651,000 shares. As of August 1, 2008, we have repurchased approximately $836.7 million of common stock, representing 17,874,712 shares under our currently authorized share repurchase program.

Comprehensive income consisted of the following:

			Quarter Ended				Nine Months Ended
			August 1,		July 27,		August 1,		July 27,
In thousands			2008		2007		2008		2007

Net income		$	113,079	$	72,901	$	256,239	$	210,145
Other comprehensive income (loss):
	Pension & postretirement adjustments		(20,227)		-		(14,321)		-
	Translation adjustments		5,511		10,937		(11,195)		28,682
	Derivative fair value adjustments		1,509		4,212		(1,567)		4,570
Total other comprehensive income (loss)			(13,207)		15,149		(27,083)		33,252
Total comprehensive income		$	99,872	$	88,050	$	229,156	$	243,397

5.	Share-Based Compensation

The total share-based compensation expense we recognized for the nine months ended August 1, 2008 and July 27, 2007 was approximately $10.2 million and $8.1 million, respectively. The total share-based compensation expense we recognized for the third quarter 2008 and 2007 was approximately $3.6 million and $2.8 million, respectively.

A summary of stock option activity under all plans is as follows:

					Aggregate
			Weighted-Average		Intrinsic
	Number of		Exercise Price		Value
In thousands, except per share amounts	Options		per Share		(In Millions)

Outstanding at October 26, 2007	2,160,463	$	25.20

Options granted	727,700		57.65
Options exercised	(861,903)		21.22
Options forfeited or cancelled	(58,960)		50.20

Outstanding at August 1, 2008	1,967,300	$	38.19	$	66.1
Exercisable at August 1, 2008	730,613	$	19.20	$	38.4

6.	Basic and Diluted Net Income Per Share

Basic net income per share is computed based on the weighted-average number of shares outstanding during each period. Diluted net income per share is computed based on the weighted-average number of ordinary shares during each period, plus dilutive potential shares considered outstanding during the period in accordance with SFAS No. 128, “Earnings per Share.”

The following table sets forth the computation of basic and diluted earnings per share:

			Quarter Ended				Nine Months Ended
			August 1,		July 27,		August 1,		July 27,
In thousands except per share data			2008		2007		2008		2007
Numerator:
	Income from continuing operations	$	113,079	$	72,901	$	255,098	$	210,145
	Discontinued operations		-		-		1,141		-
	Net income	$	113,079	$	72,901	$	256,239	$	210,145

Denominator:
	Denominator for basic net income per share -
	Weighted average shares		108,495		109,137		108,193		111,079
	Effect of dilutive securities:
	Stock options, restricted stock units and
	performance shares		951		1,325		1,037		1,331
	Denominator for diluted net income per share -
	Adjusted weighted average shares and
	assumed conversions		109,446		110,462		109,230		112,410

Basic earnings per share
	Income from continuing operations	$	1.04	$	0.67	$	2.36	$	1.89
	Discontinued operations		-		-		0.01		-
	Net Income	$	1.04	$	0.67	$	2.37	$	1.89

Diluted earnings per share
	Income from continuing operations	$	1.03	$	0.66	$	2.34	$	1.87
	Discontinued operations		-		-		0.01		-
	Net Income	$	1.03	$	0.66	$	2.35	$	1.87

7.	Goodwill and Intangible Assets

Goodwill and intangible assets with indefinite useful lives are not amortized but are tested for impairment at least annually. Intangible assets with finite useful lives are amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment in accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.”

				August 1, 2008				October 26, 2007
		Weighted
		Average		Gross				Gross
		Amortization		Carrying		Accumulated		Carrying		Accumulated
In thousands		Period		Amount		Amortization		Amount		Amortization
Finite lived other intangible assets:
	Engineering drawings	6 years	$	2,900	$	(967)	$	2,900	$	(604)
	Customer relationships	20 years		105,200		(5,705)		31,000		(2,519)
	Backlog	1 year		15,089		(13,800)		5,990		(5,990)
	Non-compete agreements	5 years		5,800		(2,147)		5,300		(1,325)
	Patents	17 years		21,207		(5,614)		10,559		(4,886)
	Unpatented technology	35 years		1,147		(167)		1,147		(140)
	Subtotal	17 years		151,343		(28,400)		56,896		(15,464)

Indefinite lived other intangible assets:
	Trademarks			75,400		-		21,500		-

Total other intangible assets			$	226,743	$	(28,400)	$	78,396	$	(15,464)

Changes in the carrying amount of goodwill from October 26, 2007 are as follows:

In thousands		Underground Mining Machinery		Surface Mining Equipment		Crushing & Conveying

Balance as of October 26, 2007	$	7,018	$	9,766	$	-

Translation adjustments		-		(98)		-

Balance as of February 1, 2008	$	7,018	$	9,668	$	-

Goodwill acquired during the period		-		-		112,767
Translation adjustments		-		399		111

Balance as of May 2, 2008	$	7,018	$	10,067	$	112,878

Translation adjustments		-		83		30

Balance as of August 1, 2008	$	7,018	$	10,150	$	112,908

Amortization expense was $6.4 million and $2.5 million for the third quarter of 2008 and 2007, respectively and $12.9 million and $7.8 million for the nine months ended August 1, 2008 and July 27, 2007, respectively. Estimated annual amortization expense is as follows:

In thousands
For the fiscal year ending:
	2008	$	16,193
	2009		8,419
	2010		8,248
	2011		7,903
	2012		6,933

8.	Contingent Liabilities

We and our subsidiaries are involved in various unresolved legal matters that arise in the normal course of operations, the most prevalent of which relate to product liability (including asbestos-related and silicosis liability), employment and commercial matters. Also, as a normal part of their operations, our subsidiaries undertake contractual obligations, warranties and guarantees in connection with the sale of products or services. Although the outcome of these matters cannot be predicted with certainty and favorable or unfavorable resolutions may affect the results of operations on a quarter-to-quarter basis, we believe that the outcome of such legal and other matters will not have a materially adverse effect on our consolidated financial position, results of operations or liquidity.

From time to time we and our subsidiaries become involved in proceedings relating to environmental matters. We believe that the resolution of such environmental matters will not have a materially adverse effect on our consolidated financial position, results of operations or liquidity.

In June 2008, we finalized an extension of the collective bargaining agreement through August 2012 with the United Steelworkers of America (“Steelworkers”) at P&H Mining Equipment’s manufacturing facility in Milwaukee, Wisconsin.

In the second quarter of fiscal 2008, we recorded a $21.0 million charge related to the termination of a maintenance and repair contract. The contract covers equipment that includes a dragline delivered in 1996 and includes provisions that mitigate the customer’s risk associated with buying the first of the 9020-model dragline. The charge includes the write-off of related assets plus anticipated transition costs. The charge was recorded in the second quarter based on the status of termination negotiations related to the contract. The termination of the contract was finalized in the third quarter of fiscal 2008 with an additional charge of $1.7 million.

At August 1, 2008, we were contingently liable to banks, financial institutions and others for approximately $208.7 million for outstanding letters of credit, bank guarantees and surety bonds securing performance of sales contracts and other guarantees in the ordinary course of business. Included in the amount were $42.0 million of outstanding letters of credit or other guarantees issued by non-U.S. banks for non-U.S. subsidiaries.

We have entered into various forward foreign exchange contracts with major international financial institutions for the purpose of hedging our risk of loss associated with changes in foreign exchange rates. These contracts involve off-balance-sheet market and credit risk. As of August 1, 2008, the nominal or face value of forward foreign exchange contracts to which we are a party, in U.S. dollar equivalent terms, was $695.1 million.

Forward exchange contracts are entered into to protect the value of committed future foreign currency receipts and disbursements and net investment hedges and consequently any market related loss on the forward contract would be offset by changes in the value of the hedged item.

We are exposed to credit-related losses in the event of non-performance by counterparties to our forward exchange contracts, but we do not expect any counterparties to fail to meet their obligations. A contract is generally subject to credit risk only when it has a positive fair value and the maximum exposure is the amount of the positive fair value.

9.	Continental Acquisition

On February 14, 2008 we completed the acquisition of N.E.S. Investment Co. including its subsidiary, Continental Global Group, Inc. (collectively “Continental”) a worldwide leader in conveyor systems for bulk material handling in mining and industrial applications. The results of operations for Continental have been included in the accompanying consolidated financial statements from that date forward. The Continental acquisition further strengthens our ability to provide a more complete mining solution to our customers.

We purchased all of the outstanding shares of Continental for an aggregate amount of $252.1 million, which is net of approximately $5.9 million of indebtedness assumed by us at closing and $12.0 million of cash acquired. We also incurred $1.9 million of direct acquisition costs related to the acquisition.

Following is condensed balance sheet data showing the fair values of the assets acquired and the liabilities assumed as of the date of acquisition:

(In thousands)
Current assets	$	109,968
Property, plant & equipment		34,082
Intangible assets		147,689
Goodwill		112,767
Other assets		554
Current liabilities		(72,890)
Deferred Income taxes		(73,656)
Other long-term obligations		(4,506)
Net assets acquired	$	254,008

Of the $147.7 million of intangible assets, $53.9 million has been preliminarily assigned to trademarks which are not being amortized. The remaining $93.8 million of intangible assets has been assigned to the following categories and are being amortized over a weighted-average useful life of 18 years:

(In thousands)
Customer relationships	$	74,200
Patents		10,490
Backlog		9,099
	$	93,789

We are still in the process of finalizing third-party valuations of certain intangible assets and real and personal property and working capital adjustment; accordingly, allocation of the purchase price is subject to modification in the future.

Following are pro forma amounts assuming that the acquisition was made on October 29, 2006:

	(In thousands, except per share amounts)		Quarter Ended				Nine Months Ended
			August 1, 2008		July 27, 2007		August 1, 2008		July 27, 2007

Net sales		$	903,769	$	703,477	$	2,491,156	$	2,042,998

Income from continuing operations		$	115,934	$	75,953	$	265,013	$	213,250
Income from discontinued operations			-		-		1,141		-
Net income		$	115,934	$	75,953	$	266,154	$	213,250

Basic earnings per share:
	Income from continuing operations	$	1.07	$	0.70	$	2.45	$	1.92
	Income from discontinued operations		-		-		0.01		-
	Net income	$	1.07	$	0.70	$	2.46	$	1.92

Diluted earnings per share:
	Income from continuing operations	$	1.06	$	0.69	$	2.43	$	1.90
	Income from discontinued operations		-		-		0.01		-
	Net income	$	1.06	$	0.69	$	2.44	$	1.90

10.

Inventories

Consolidated inventories consisted of the following:

		August 1,		October 26,
In thousands		2008		2007
Finished goods	$	591,984	$	508,045
Work in process and purchased parts		186,295		151,642
Raw materials		114,334		67,673
	$	892,613	$	727,360

11.

Warranties

We provide a warranty reserve for the estimated costs that may be incurred under product warranties to remedy deficiencies of quality or performance in our products. These product warranties extend over either a specified period of time, units of production or machine hours depending upon the product subject to the warranty. We accrue a provision for estimated future warranty costs based upon the historical relationship of warranty costs to sales. We periodically review the adequacy of the accrual for product warranties and adjust the warranty percentage and accrued warranty reserve for actual experience as appropriate.

The following table reconciles the changes in the Company's product warranty reserve:

			Quarter Ended				Nine Months Ended
			August 1,		July 27,		August 1,	July 27,
In thousands			2008		2007		2008	2007
Balance, beginning of period		$	49,821	$	41,076	$	49,382	38,929
	Acquisitions (preliminary)		-		-		2,762	-
	Accrual for warranty expensed during
	the period		8,572		8,451		22,867	23,048
	Settlements made during the period		(8,491)		(7,115)		(23,973)	(20,553)
	Change in liability for pre-existing warranties
	during the period, including expirations		185		135		368	342
	Effect of foreign currency translation		334		734		(985)	1,515
Balance, end of period		$	50,421	$	43,281	$	50,421	43,281

12.

Retiree Benefits

The components of net periodic benefit costs recognized are as follows:

			Pension Benefits				Postretirement Benefits
			Quarter Ended				Quarter Ended
			August 1,		July 27,		August 1,		July 27,
In thousands			2008		2007		2008		2007

Service cost		$	5,806	$	5,609	$	231	$	220
Interest cost			25,442		19,837		598		798
Expected return on assets			(29,704)		(21,805)		(53)		(63)
Amortization of:
	Prior service cost		408		195		(41)		(25)
	Actuarial loss (gain)		1,913		5,875		(113)		111
Net periodic benefit cost		$	3,865	$	9,711	$	622	$	1,041

			Pension Benefits				Postretirement Benefits
			Nine Months Ended				Nine Months Ended
			August 1,		July 27,		August 1,		July 27,
In thousands			2008		2007		2008		2007

Service cost		$	16,371	$	17,154	$	692	$	659
Interest cost			68,654		59,866		1,795		2,394
Expected return on assets			(77,386)		(65,367)		(160)		(189)
Amortization of:
	Prior service cost		706		446		(123)		(75)
	Actuarial loss (gain)		7,354		17,254		(340)		334
Net periodic benefit cost		$	15,699	$	29,353	$	1,864	$	3,123

During the third quarter of 2008, we recalculated our liability under the Joy Global Inc. Pension Plan in conjunction with the extension of the collective bargaining agreement with the United Steelworkers of America at P&H Mining Equipment’s manufacturing facility in Milwaukee, Wisconsin. The result was to increase the net pension liability by approximately $40.1 million through an adjustment to other comprehensive income (loss).

During the third quarter of 2008, we also contributed $32.5 million to the Joy Global Inc. Pension Plan in order to meet certain funding requirements. Including contributions already made, we now expect to contribute approximately $58 million to our employee pension plans in fiscal 2008.

13.

Income Taxes

The effective income tax rates for the third quarters of 2008 and 2007 were 12.1% and 29.4%, respectively. The main drivers of the variance in tax rates when compared to the statutory rate of 35% were the geographic mix of earnings with the corresponding differences in foreign statutory tax rates and the utilization of tax credits and tax holidays offset by U.S. State income taxes. Additionally, a discrete net tax benefit of $23.6 million was recorded in the third quarter of 2008 primarily related to U.S. foreign tax credits available for future utilization. In the third quarter of 2007, a discrete net tax benefit of $4.5 million was recorded relating to the true-up of prior years’ tax provision and certain U.S. Subpart F inclusions.

The effective income tax rates for the fiscal 2008 nine months and fiscal 2007 nine months were 25.4% and 31.3%, respectively. The main drivers of the variance in tax rates when compared to the statutory rate of 35% were the geographic mix of earnings with the corresponding differences in foreign statutory tax rates and the utilization of tax credits and tax holidays offset by U.S. State income taxes. Additionally, a discrete net tax benefit of $23.4 million was recorded for the fiscal 2008 nine months primarily related to the U.S. foreign tax credits available for future utilization. Through the fiscal 2007 nine months, a discrete net tax benefit of $4.5 million was recorded relating to the true-up of prior years’ tax provision and certain U.S. Subpart F inclusions.

As of October 27, 2007, we adopted the provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 48 (“FIN 48”), Accounting for Uncertainty in Income Taxes. As a result of this adoption, we recorded an additional tax liability of approximately $0.2 million to shareholders’ equity. As of August 1, 2008 and October 27, 2007, net unrecognized tax benefits of approximately $18.5 million and $17.4 million, respectively, were recorded with approximately $22.8 million and $21.7 million, respectively, recorded in other non-current liabilities and $4.3 million recorded in other non-current assets. If recognized, all of the net unrecognized tax liabilities and assets would affect the effective tax rate.

Interest and penalties associated with unrecognized tax benefits have been historically recorded as part of the provision for income tax in the Consolidated Statement of Income. As of August 1, 2008 and October 27, 2007, total interest and penalties of approximately $2.9 million and $1.8 million, respectively, were accrued as part of unrecognized tax benefits in the Consolidated Balance Sheet.

With respect to tax years subject to examination by the domestic taxing authorities, all years prior to and including 1999 are closed by statute with all subsequent years open due to the loss carryforward from 2000 and 2003 for U.S. Federal purposes. Additionally, due to the existence of tax loss carryforwards, the same relative periods exist for U.S. State purposes although, in some instances, earlier years also remain open. From a foreign jurisdiction perspective, the major locations in which we conduct business are as follows: United Kingdom – 2006 forward is open for examination; South Africa – 2004 forward is open for examination; Australia – 1997 forward remains open due to tax loss carryforwards; and Canada – 2003 forward is open for examination. There are a number of smaller entities in other countries that generally have tax statutes of limitation ranging from 3 to 5 years.

14.

Segment Information

As of August 1, 2008, we had three reportable segments: Underground Mining Machinery, Surface Mining Equipment and Crushing & Conveying. The Crushing & Conveying segment was created with the acquisition of Continental Global Group in the second quarter of 2008 and also includes breakage equipment previously only shown in Underground Mining Machinery. The intersegment sales for Crushing & Conveying include sales of breakage equipment to the Underground Mining Machinery and Surface Mining Equipment segments. Prior year quarter and nine months information related to breakage equipment has not been reclassified due to materiality. Operating income (loss) of the segments does not include interest income (expense) or provision for income taxes. Eliminations include the elimination of intersegment breakage equipment sales and the related operating income.

				Underground		Surface
				Mining		Mining		Crushing &
				Machinery		Equipment		Conveying		Corporate		Eliminations		Total

3rd Quarter 2008
Net Sales
	Third party		$	453,003	$	365,543	$	85,223	$	-	$	-	$	903,769
	Intersegment			-		-		23,405		-		(23,405)		-
		Total	$	453,003	$	365,543	$	108,628	$	-	$	(23,405)	$	903,769

Operating income (loss)			$	87,817	$	53,185	$	7,996	$	(9,309)	$	(6,070)	$	133,619
Interest income				-		-		-		3,700		-		3,700
Interest expense				-		-		-		(8,581)		-		(8,581)
Reorganization items				-		-		-		(135)		-		(135)
Income before income taxes			$	87,817	$	53,185	$	7,996	$	(14,325)	$	(6,070)	$	128,603

3rd Quarter 2007
Net sales
	Third party		$	347,149	$	274,636	$	-	$	-	$	-	$	621,785
	Intersegment			-		-		-		-		-		-
		Total	$	347,149	$	274,636	$	-	$	-	$	-	$	621,785

Operating income (loss)			$	63,563	$	53,671	$	-	$	(6,968)	$	-	$	110,266
Interest income				-		-		-		1,188		-		1,188
Interest expense				-		-		-		(8,118)		-		(8,118)
Reorganization items				-		-		-		(135)		-		(135)
Income before income taxes			$	63,563	$	53,671	$	-	$	(14,033)	$	-	$	103,201

Nine months 2008
Net sales
	Third party		$	1,209,417	$	1,019,630	$	158,184	$	-	$	-	$	2,387,231
	Intersegment			-		-		62,542		-		(62,542)		-
		Total	$	1,209,417	$	1,019,630	$	220,726	$	-	$	(62,542)	$	2,387,231

Operating income (loss)			$	233,334	$	152,030	$	11,932	$	(25,881)	$	(12,370)	$	359,045
Interest income				-		-		-		9,344		-		9,344
Interest expense				-		-		-		(24,030)		-		(24,030)
Reorganization items				-		-		-		(2,311)		-		(2,311)
Income before income taxes			$	233,334	$	152,030	$	11,932	$	(42,878)	$	(12,370)	$	342,048

Nine months 2007
Net sales
	Third party		$	1,037,449	$	773,964	$	-	$	-	$	-	$	1,811,413
	Intersegment			-		-		-		-		-		-
		Total	$	1,037,449	$	773,964	$	-	$	-	$	-	$	1,811,413

Operating income (loss)			$	203,374	$	144,184		-	$	(21,733)	$	-	$	325,825
Interest income				-		-		-		5,032		-		5,032
Interest expense				-		-		-		(24,447)		-		(24,447)
Reorganization items				-		-		-		(415)		-		(415)
Income before income taxes			$	203,374	$	144,184	$	-	$	(41,563)	$	-	$	305,995

15.

Discontinued Operations

In November 2005, we concluded the sale of the stock of The Horsburgh & Scott Co. (“H&S”), a wholly owned subsidiary, to members of the management team for cash and a note receivable of approximately $12.0 million. The gain on the sale of $1.8 million (pre-tax) was deferred until realizability was reasonably assured. During the quarter ended February 1, 2008, we collected the entire amount receivable and realized the deferred gain, net of taxes, as income from discontinued operations on the Condensed Consolidated Statement of Income.

16.

Subsequent Event

On August 25, 2008, our Board of Directors increased our quarterly dividend by 17% from $0.15 to $0.175 per outstanding share of common stock. The dividend will be paid on September 19, 2008 to all shareholders of record at the close of business on September 5, 2008.

17.

Recent Accounting Pronouncements

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments and Hedging Activities (“SFAS 161”). SFAS 161 changes disclosure requirements for derivative instruments and hedging activities including how and why an entity uses derivative instruments, how derivative instruments are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities and how derivative instruments and related hedged items affect an entity’s financial statements. SFAS 161 becomes effective for us beginning in fiscal 2010. We are currently evaluating the adoption of SFAS 161 to determine the effect on our financial statements and related disclosures.

In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements an amendment of ARB No. 51 (“SFAS 160”). The objective of SFAS 160 is to improve the transparency and comparability of financial information that is provided as it relates to a parent and noncontrolling interests. SFAS 160 requires clear identification of ownership interests in subsidiaries held by other parties and the amount of consolidated net income attributable to the parent and other parties. The standard also requires changes in parent ownership interest while the parent retains its controlling interest in the subsidiary to be accounted for consistently. SFAS 160 becomes effective for us beginning in fiscal 2010. We are currently evaluating the adoption of SFAS 160 to determine the effect on our financial statements and related disclosures.

In December 2007, the FASB issued SFAS No. 141 (Revised), Business Combinations (“SFAS 141(R)”). SFAS 141(R) requires the measurement at fair value of assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree as of the acquisition date. SFAS 141(R) also requires that acquisition related costs and costs to restructure the acquiree be expensed as incurred. SFAS 141(R) becomes effective for us beginning in fiscal 2010.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (“SFAS 159”). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value. SFAS 159 becomes effective for us beginning in fiscal 2009. We are currently evaluating the adoption of SFAS 159 to determine the effect on our financial statements and related disclosures.

In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS 157”). SFAS 157 provides a definition of fair value, establishes a framework for measuring fair value within GAAP, and

expands disclosures about fair value measurements. SFAS 157 becomes effective for us beginning in fiscal 2009. We are currently evaluating the adoption of SFAS 157 to determine the effect on our financial statements and related disclosures.

18.

Subsidiary Guarantors

The following tables present condensed consolidated financial information as of and for the quarter and nine months ended August 1, 2008 and July 27, 2007 for; (a) the Company; (b) on a combined basis, the guarantors of the Credit Agreement and Senior Notes issued in November 2006, which include the significant domestic operations of Joy Technologies Inc., P&H Mining Equipment Inc., N.E.S. Investment Co. and Continental Crushing & Conveying Inc. (“Subsidiary Guarantors”); and (c) on a combined basis, the non-guarantors, which include all of our foreign subsidiaries and a number of small domestic subsidiaries (“Non-Guarantor Subsidiaries”). Separate financial statements of the Subsidiary Guarantors are not presented because the guarantors are unconditionally, jointly, and severally liable under the guarantees, and we believe such separate statements or disclosures would not be useful to investors.

Condensed Consolidated

Statement of Income

Quarter Ended August 1, 2008

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net sales		$	-	$	580,360	$	549,035	$	(225,626)	$	903,769

Cost of sales			-		437,955		407,575		(187,732)		657,798

Product development, selling
	and administrative expenses		9,288		62,340		41,860		-		113,488
Other (income) expense			-		11,155		(12,291)		-		(1,136)
Operating income (loss)			(9,288)		68,910		111,891		(37,894)		133,619

Intercompany items			4,504		(22,072)		(9,142)		26,710		-
Interest income (expense) - net			(8,066)		111		3,074		-		(4,881)
Reorganization items			(135)		-		-		-		(135)

Income (loss) from continuing operations
	before income taxes and equity		(12,985)		46,949		105,823		(11,184)		128,603

Provision (benefit) for income taxes			(33,439)		31,491		17,472		-		15,524
Equity in income (loss) of subsidiaries			92,625		68,410		-		(161,035)		-

Income (loss) from continuing operations			113,079		83,868		88,351		(172,219)		113,079

Income from discontinued operations			-		-		-		-		-

Net income		$	113,079	$	83,868	$	88,351	$	(172,219)	$	113,079

Condensed Consolidated

Statement of Income

Quarter Ended July 27, 2007

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net sales		$	-	$	373,372	$	425,870	$	(177,457)	$	621,785

Cost of sales			-		258,638		311,642		(145,384)		424,896

Product development, selling
	and administrative expenses		6,923		41,791		40,195		-		88,909
Other (income) expense			-		7,747		(10,033)		-		(2,286)
Operating income (loss)			(6,923)		65,196		84,066		(32,073)		110,266

Intercompany items			(2,865)		(4,030)		(19,947)		26,842		-
Interest income (expense) - net			(7,914)		485		499		-		(6,930)
Reorganization items			(135)		-		-		-		(135)

Income (loss) before income taxes
	and equity		(17,837)		61,651		64,618		(5,231)		103,201

Provision (benefit) for income taxes s			(10,676)		32,388		8,588		-		30,300
Equity in income (loss) of subsidiaries			80,062		43,061		11,677		(134,800)		-

Net income		$	72,901	$	72,324	$	67,707	$	(140,031)	$	72,901

Condensed Consolidated

Statement of Income

Nine Months Ended August 1, 2008

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net sales		$	-	$	1,481,025	$	1,469,441	$	(563,235)	$	2,387,231

Cost of sales			-		1,067,321		1,093,890		(454,076)		1,707,135

Product development, selling
	and administrative expenses		25,900		160,461		136,616		-		322,977
Other (income) expense			-		31,979		(33,905)		-		(1,926)
Operating income (loss)			(25,900)		221,264		272,840		(109,159)		359,045

Intercompany items			5,816		(36,547)		(41,047)		71,778		-
Interest income (expense) - net			(22,275)		550		7,039		-		(14,686)
Reorganization items			(259)		-		(2,052)		-		(2,311)

Income (loss) from continuing operations
	before income taxes and equity		(42,618)		185,267		236,780		(37,381)		342,048

Provision (benefit) for income taxes			(45,948)		97,316		35,582		-		86,950
Equity in income (loss) of subsidiaries			252,909		151,488		-		(404,397)		-

Income (loss) from continuing operations			256,239		239,439		201,198		(441,778)		255,098

Income from discontinued operations			-		1,141		-		-		1,141

Net income		$	256,239	$	240,580	$	201,198	$	(441,778)	$	256,239

Condensed Consolidated

Statement of Income

Nine Months Ended July 27, 2007

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net sales		$	-	$	1,170,940	$	1,106,024	$	(465,551)	$	1,811,413

Cost of sales			-		813,689		797,155		(380,359)		1,230,485

Product development, selling
	and administrative expenses		21,536		129,415		108,821		-		259,772
Other (income) expense			-		22,151		(26,820)		-		(4,669)
Operating income (loss)			(21,536)		205,685		226,868		(85,192)		325,825

Intercompany items			(6,210)		(19,670)		(40,849)		66,729		-
Interest income (expense) - net			(21,910)		784		1,711		-		(19,415)
Reorganization items			(415)		-		-		-		(415)

Income (loss) before income taxes
	and equity		(50,071)		186,799		187,730		(18,463)		305,995

Provision (benefit) for income taxes			(25,188)		86,830		34,208		-		95,850
Equity in income (loss) of subsidiaries			235,028		118,595		25,673		(379,296)		-

Net income		$	210,145	$	218,564	$	179,195	$	(397,759)	$	210,145

Condensed Consolidated

Balance Sheet

August 1, 2008

(In thousands)

				Parent		Subsidiary		Non-Guarantor
				Company		Guarantors		Subsidiaries		Eliminations		Consolidated
ASSETS
Current assets:
	Cash and cash equivalents		$	60,119	$	7,746	$	239,020	$	-	$	306,885
	Accounts receivable-net			-		265,868		349,805		(13,755)		601,918
	Inventories			-		470,723		537,114		(115,224)		892,613
	Other current assets			69,498		8,470		46,448		(1,429)		122,987
		Total current assets		129,617		752,807		1,172,387		(130,408)		1,924,403

Property, plant and equipment-net				150		183,551		110,041		-		293,742
Intangible assets-net				-		312,792		15,627		-		328,419
Investment in affiliates				2,391,174		1,181,578		240,310		(3,813,062)		-
Intercompany accounts-net				(1,062,396)		420,190		699,517		(57,311)		-
Deferred income taxes				233,920		-		204		-		234,124
Prepaid benefit costs				-		-		14,143		-		14,143
Other assets				2,967		12,776		13,743		-		29,486
		Total assets	$	1,695,432	$	2,863,694	$	2,265,972	$	(4,000,781)	$	2,824,317

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
	Short-term notes payable, including current portion
	of long-term obligations		$	17,500	$	14	$	969	$	-	$	18,483
	Trade accounts payable			1,083		146,986		120,308		-		268,377
	Employee compensation and benefits			9,262		60,899		29,668		-		99,829
	Advance payments and progress billings			-		254,928		270,637		(59,580)		465,985
	Accrued warranties			-		26,518		23,903		-		50,421
	Other accrued liabilities			(6,042)		37,680		98,887		(3,650)		126,875
		Total current liabilities		21,803		527,025		544,372		(63,230)		1,029,970

Long-term obligations				544,122		145		1,827		-		546,094

Other non-current liabilities				228,350		11,612		107,134		-		347,096

Shareholders' equity				901,157		2,324,912		1,612,639		(3,937,551)		901,157

		Total liabilities and shareholders' equity	$	1,695,432	$	2,863,694	$	2,265,972	$	(4,000,781)	$	2,824,317

Condensed Consolidated

Balance Sheet

October 26, 2007

(In thousands)

				Parent		Subsidiary		Non-Guarantor
				Company		Guarantors		Subsidiaries		Eliminations		Consolidated
ASSETS
Current assets:
	Cash and cash equivalents		$	36,614	$	11,394	$	125,240	$	-	$	173,248
	Accounts receivable-net			-		228,080		338,714		(6,552)		560,242
	Inventories			-		378,069		425,878		(76,587)		727,360
	Other current assets			37,026		21,145		21,248		(2,474)		76,945
		Total current assets		73,640		638,688		911,080		(85,613)		1,537,795

Property, plant and equipment-net				177		147,781		86,071		-		234,029
Intangible assets-net				-		68,998		10,718		-		79,716
Investment in affiliates				1,905,608		914,767		214,965		(3,035,340)		-
Intercompany accounts receivable-net				(864,779)		217,697		686,627		(39,545)		-
Deferred income taxes				248,139		-		-		-		248,139
Prepaid benefit costs				-		-		779		-		779
Other assets				1,898		16,463		16,084		-		34,445
		Total assets	$	1,364,683	$	2,004,394	$	1,926,324	$	(3,160,498)	$	2,134,903

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities:
	Short-term notes payable, including current portion
	of long-term debt		$	-	$	13	$	227	$	-	$	240
	Trade accounts payable			1,523		91,181		106,494		-		199,198
	Employee compensation and benefits			7,803		25,849		25,838		-		59,490
	Advance payments and progress billings			-		171,369		179,298		(26,565)		324,102
	Accrued warranties			-		25,250		24,132		-		49,382
	Other accrued liabilities			15,498		31,348		77,515		(3,234)		121,127
		Total current liabilities		24,824		345,010		413,504		(29,799)		753,539

Long-term obligations				395,152		149		956		-		396,257

Other non-current liabilities				220,713		12,472		27,928		-		261,113

Shareholders' equity (deficit)				723,994		1,646,763		1,483,936		(3,130,699)		723,994

		Total liabilities and shareholders' equity (deficit)	$	1,364,683	$	2,004,394	$	1,926,324	$	(3,160,498)	$	2,134,903

Condensed Consolidated

Statement of Cash Flows

Nine Months Ended August 1, 2008

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net cash provided (used) by operating activities		$	183,974	$	22,275	$	128,218	$	-	$	334,467

Investing Activities:
	Acquisition of business, net of cash received		(266,004)		2,592		8,168		-		(255,244)
	Property, plant and equipment acquired		-		(37,216)		(19,101)		-		(56,317)
	Proceeds from the sale of business		-		9,868		-		-		9,868
	Other - net		509		(1,164)		944		-		289
	Net cash (used) provided by investing activities		(265,495)		(25,920)		(9,989)		-		(301,404)

Financing Activities:
	Exercise of stock options		18,293		-		-		-		18,293
	Excess income tax benefit from exercise of stock options		12,021		-		-		-		12,021
	Dividends paid		(48,572)		-		-		-		(48,572)
	Purchase of treasury stock		(41,471)		-		-		-		(41,471)
	Financing fees		(1,495)		-		-		-		(1,495)
	Borrowings (payments) on long-term obligations, net		166,250		(3)		(676)		-		165,571
	Increase (decrease) in short-term notes payable, net		-		-		(3,786)		-		(3,786)
	Net cash used by financing activities		105,026		(3)		(4,462)		-		100,561

Effect of exchange rate changes on cash and
	cash equivalents		-		-		13		-		13
Increase (decrease) in cash and cash equivalents			23,505		(3,648)		113,780		-		133,637
Cash and cash equivalents at beginning of period			36,614		11,394		125,240		-		173,248
Cash and cash equivalents at end of period		$	60,119	$	7,746	$	239,020	$	-	$	306,885

Condensed Consolidated

Statement of Cash Flows

Nine Months Ended July 27, 2007

(In thousands)

			Parent		Subsidiary		Non-Guarantor
			Company		Guarantors		Subsidiaries		Eliminations		Consolidated

Net cash provided (used) by operating activities		$	156,046	$	12,407	$	41,881	$	-	$	210,334

Investing Activities:
	Acquisition of business, net of cash received		-		(2,147)		(8,454)		-		(10,601)
	Property, plant and equipment acquired		-		(29,477)		(13,638)		-		(43,115)
	Proceeds from the sale of business		-		228		-		-		228
	Other - net		(157)		538		1,004		-		1,385
	Net cash (used) provided by investing activities		(157)		(30,858)		(21,088)		-		(52,103)

Financing Activities:
	Exercise of stock options		11,869		-		-		-		11,869
	Excess income tax benefit from exercise of stock options		6,977		-		-		-		6,977
	Dividends paid		(49,985)		-		-		-		(49,985)
	Purchase of treasury stock		(456,631)		-		-		-		(456,631)
	Issuance of senior notes		394,874		-		-		-		394,874
	Financing fees		(976)		-		-		-		(976)
	Borrowings (payments) on long-term obligations, net		(47,048)		(2)		(338)		-		(47,388)
	Increase (decrease) in short-term notes payable, net		-		-		(5,248)		-		(5,248)
	Net cash used by financing activities		(140,920)		(2)		(5,586)		-		(146,508)

Effect of exchange rate changes on cash and
	cash equivalents		-		-		5,631		-		5,631
Increase (decrease) in cash and cash equivalents			14,969		(18,453)		20,838		-		17,354
Cash and cash equivalents at beginning of period			(1,270)		24,970		77,554		-		101,254
Cash and cash equivalents at end of period		$	13,699	$	6,517	$	98,392	$	-	$	118,608

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes to the Condensed Consolidated Financial Statements in Part I of this report. Dollar amounts are in thousands, except share and per share data and as indicated.

Overview

Joy Global Inc., a worldwide leader in high-productivity mining solutions, manufactures and markets original equipment and aftermarket parts and services for both the underground and aboveground mining industries and certain industrial applications through three business segments, Underground Mining Machinery, Surface Mining Equipment and Crushing & Conveying. Our principal manufacturing facilities are located in the United States, including facilities in Pennsylvania, Wisconsin and Alabama, and in the United Kingdom, South Africa, Chile, Australia and China.

Orders in the third quarter of 2008 were up to a record $1.5 billion, up 139% from $628 million in the prior-year period and were $3.6 billion for the fiscal 2008 nine months, up 87% from $1.9 billion in the prior-year nine months, both on strengthened conditions in the U.S. coal market and continued growing demand from the international markets. Net sales for the third quarter of 2008 were $903.8 million compared to $621.8 million in the prior-year period, an increase of 45% and for the fiscal 2008 nine months were $2.4 billion, up 32% compared to $1.8 billion in the prior-year nine months. In response to the continued strength of international demand for mined resources and the resurgence of the U.S. underground market, capacity increases and process improvement initiatives have allowed revenue increases both in the quarter and nine-month period. The Continental business has also added $85.2 million and $158.2 million of sales in the quarter and nine-month period of 2008. Operating income in the quarter increased to $133.6 million from $110.3 million in the third quarter 2007 and increased in the fiscal 2008 nine months to $359.0 million from $325.8 million in the comparable prior year period.

During the third quarter of 2008, we finalized an extension of our labor agreement through August 2012 with the United Steelworkers of America at our manufacturing facility in Milwaukee, Wisconsin. The agreement will provide workforce stability as we navigate through record demand for mining equipment worldwide.

During the third quarter of 2008, we continued the integration of the Continental acquisition, including the rebranding of the Continental Crushing & Conveying entity. During the quarter and nine-month period, Continental contributed $112.6 million and $199.4 million to bookings. Continental’s operating income for the quarter and nine-month period was negatively impacted by $5.8 million and $16.9 million of purchase accounting charges, respectively.

In the second quarter of fiscal 2008 we revised our reportable segments and now have three segments: Underground Mining Machinery, Surface Mining Equipment and Crushing & Conveying. The Crushing & Conveying segment includes both the legacy Continental business and Stamler breakage equipment. With the creation of our third segment, we also have eliminations which represent the sales and operating income associated with the Stamler breakage equipment that were sold through the Underground Mining Machinery and Surface Mining Equipment segments.

During the third quarter of 2008 we renamed the following divisions to align to internal presentation. Neither Eurasia nor Australasia includes China.

Previous Presentation	Revised Presentation
Emerging markets served out of the United Kingdom	Eurasia
Australia	Australasia

Results of Operations

Quarter Ended August 1, 2008 to Quarter Ended July 27, 2007.

Net Sales

The following table sets forth the combined net sales included in our Condensed Consolidated Statement of Income:

			Quarter Ended
			August 1,		July 27,		$	%
In thousands			2008		2007		Change	Change

Net Sales
	Underground Mining Machinery	$	453,003	$	347,149	$	105,854	30.5%
	Surface Mining Equipment		365,543		274,636		90,907	33.1%
	Crushing & Conveying		108,628		-		-	-
	Eliminations		(23,405)		-		-	-
	Total	$	903,769	$	621,785	$	281,984	45.4%

The increase in net sales for Underground Mining Machinery in the third quarter was the result of a $67.9 million increase in original equipment sales and a $38.0 million increase in the sale of aftermarket products and service. Increased original equipment sales were reported in Eurasia of $45.4 million, the United States of $25.7 million and South Africa of $11.4 million offset by decreased sales in China of $12.0 million. Increased original equipment sales in Eurasia were primarily the result of a roof support system shipped in the quarter while increases in the United States were due to additional shuttle cars, battery cars and a roof support system. Aftermarket sales increases were experienced globally, led by the United States due to the recovery of the United States underground coal market.

The increase in net sales for Surface Mining Equipment in the third quarter was the result of a $37.1 million increase in original equipment sales and a $53.8 million increase in aftermarket products and service. Original equipment sales increased in the United States, Chile and Canada due to the continued growth in global commodity markets offset by decreased sales in Australasia as weather and transportation issues have impacted mine productivity. Aftermarket sales increases were experienced globally, with the exception of Australasia.

The net sales in Crushing & Conveying represented the strength of the conveying systems and aftermarket parts and services in the United States, Australia and United Kingdom.

The eliminations represent the Stamler crushing equipment which is sold through the Underground Mining Machinery segment but managed as part of the Crushing & Conveying segment.

Operating Income

The following table sets forth the operating income (loss) included in our Condensed Consolidated Statement of Income:

			Quarter Ended
			August 1, 2008			July 27, 2007
			Operating	%		Operating	%
In thousands			Income (loss)	of Net Sales		Income (loss)	of Net Sales

	Underground Mining Machinery	$	87,817	19.4%	$	63,563	18.3%
	Surface Mining Equipment		53,185	14.5%		53,671	19.5%
	Crushing & Conveying		7,996	7.4%		-	-
	Corporate Expense		(9,309)	-		(6,968)	-
	Eliminations		(6,070)	-		-	-
	Total	$	133,619	14.8%	$	110,266	17.7%

Operating income for Underground Mining Machinery was $87.8 million in the third quarter of 2008, 19.4% of net sales, compared to operating income of $63.6 million in the third quarter of 2007, which was 18.3% of net sales. Operating income increased in the current quarter compared to a year ago as the result of strong sales in the United States, Eurasia and South Africa, partially offset by a slight decline in China. The third quarter of 2008 also included $7.2 million of performance-based compensation expense. The increase of the return on sales percentage in the current quarter to 19.4% was primarily due to product development, selling and administrative cost control initiatives.

Operating income for Surface Mining Equipment was $53.2 million in the third quarter of 2008, 14.5% of net sales, compared to operating income of $53.7 million in the third quarter of 2007, which was 19.5% of net sales. Operating income decreased by $0.5 million in the quarter despite $90.9 million increase in sales due to the foreign currency losses primarily in Chile of $5.4 million, the retiree benefit cost associated with the execution of the Steelworkers agreement in Milwaukee of $5.3 million, increased performance-based compensation expense of $4.5 million and increased product development, selling and administrative expense to support increased global infrastructure. The decrease in operating income as a percentage of sales was driven by the same factors as disclosed above.

Operating income for Crushing & Conveying included $6.9 million of purchase accounting charges.

Corporate expense increased by $2.3 million primarily related to increased legal fees and performance-based compensation expense.

The eliminations represent the Stamler crushing equipment which are sold through the Underground Mining Machinery segment but managed as part of the Crushing & Conveying segment.

Product Development, Selling and Administrative Expense

Product development, selling and administrative expense totaled $113.5 million, or 12.6% of sales, in the third quarter of 2008, as compared to $88.9 million, or 14.3% of sales, in the third quarter of 2007. Increased product development, selling and administrative expense was attributable to $10.8 million related to the Continental acquisition, $4.6 million of performance based compensation expense, $4.1 million of higher selling expenses related to increased business activity and the development of current and emerging markets.

Provision for Income Taxes

The provision for income taxes for the third quarter of 2008 decreased to $15.5 million as compared to $30.3 million in the third quarter of 2007. On a consolidated basis, these income tax provisions represented effective income tax rates for the third quarters of 2008 and 2007 of 12.1% and 29.4%, respectively. On a recurring basis, the main drivers of the variance in tax rates in relation to the U.S. statutory rate of 35% were the geographic mix of earnings with the corresponding differences in foreign statutory tax rates and the utilization of tax credits and tax holidays offset by U.S. State income taxes. Additionally, a discrete net tax benefit of $23.6 million was recorded in the third quarter of 2008 primarily related to U.S. foreign tax credits available for future utilization. In the third quarter of 2007, a discrete net tax benefit of $4.5 million was recorded relating to the true-up of prior years’ tax provision and certain U.S. Subpart F inclusions.

A review of income tax valuation reserves was performed as part of the analysis of the third quarter of 2008 and 2007 income tax provisions, respectively, and no material discrete adjustments were warranted for either period. Additionally, tax contingencies reserved under FIN 48 were reviewed and no adjustments were required.

Cash taxes paid for the third quarter of 2008 were $12.2 million, or 9.5% of pre-tax income, compared to $18.8 million, or 18.2% of pre-tax income, in the third quarter of 2007. This decrease in cash taxes paid was primarily due to timing requirements of local tax payments and utilization of tax credits and holidays offset by increased U.S. and international profitability year over year and reduced net operating loss availability.

Nine Months Ended August 1, 2008 to Nine Months Ended July 27, 2007.

Net Sales

			Nine Months Ended
			August 1,		July 27,		$	%
In thousands			2008		2007		Change	Change

Net Sales
	Underground Mining Machinery	$	1,209,417	$	1,037,449	$	171,968	16.6%
	Surface Mining Equipment		1,019,630		773,964		245,666	31.7%
	Crushing & Conveying		220,726		-		-	-
	Eliminations		(62,542)		-		-	-
	Total	$	2,387,231	$	1,811,413	$	575,818	31.8%

The increase in net sales for Underground Mining Machinery in the fiscal 2008 nine months compared with the fiscal 2007 nine months was the result of a $99.6 million increase in original equipment sales and a $72.4 million increase in aftermarket products and service. Increased original equipment sales were reported in Eurasia of $78.3 million, China of $37.7 million, and South Africa of $27.2 million offset by decreased sales in the United States of $22.6 million as a result of the lingering effects of the weakness in the United States underground coal market. Increases in original equipment were largely the result of increases in sales related to shearers, powered roof supports and armored face conveyors offset by decreased shipments of continuous miners. Aftermarket sales increases to support the expanding installed fleet of equipment were reported across all underground markets, with the exception of Eurasia.

The increase in net sales of Surface Mining Equipment for the fiscal 2008 nine months compared to the fiscal 2007 nine months was the result of a $107.8 million increase in original equipment and a $137.9 million increase in aftermarket products and service. Increased original equipment sales in the United States, China, Canada and Chile were primarily from sales of electric mining shovels and continued to reflect the ongoing

growth of activity levels for both the replacement of existing equipment and the addition of new mining capacity for copper, coal, and oil sands. Aftermarket sales growth was particularly strong out of the United States due to the continued strength in copper and surface mined coal and Canada due to the increased number of electric mining shovels operating in the Alberta oil sands. Aftermarket growth was partially offset by decreases in Australia due to the effects of industry consolidation and port capacity constraints.

Operating Income

			Nine Months Ended
			August 1, 2008			July 27, 2007
			Operating	%		Operating	%
In thousands			Income (loss)	of Net Sales		Income (loss)	of Net Sales

	Underground Mining Machinery	$	233,334	19.3%	$	203,374	19.6%
	Surface Mining Equipment		152,030	14.9%		144,184	18.6%
	Crushing & Conveying		11,932	5.4%		-	-
	Corporate Expense		(25,881)	-		(21,733)	-
	Eliminations		(12,370)	-		-	-
	Total	$	359,045	15.0%	$	325,825	18.0%

Operating income for Underground Mining Machinery was $233.3 million for the fiscal 2008 nine months, 19.3% of net sales, compared to operating income of $203.4 million for the same period a year ago, which was 19.6% of net sales. The increase in operating income in the fiscal 2008 nine months was associated with increased sales volumes in all markets with the exception of Australasia, and decreased pension and other post-retirement benefit expense of $12.2 million offset by $15.6 million of performance-based compensation expense and a $7.9 million increase in infrastructure spending in China. The decrease in the return on sales percentage in the fiscal 2008 nine months was due to the mix of original equipment, increased raw material costs and increased performance-based incentive compensation partially offset by focused general and administrative expense control.

Operating income for Surface Mining Equipment was $152.0 million for the fiscal 2008 nine months, 14.9% of net sales, compared to operating income of $144.2 million for the same period a year ago, which was 18.6% of net sales. The increase in operating income in the fiscal 2008 nine months was due to increased volumes offset by a $22.7 million charge related to the termination of a repair and maintenance contract in Australia, increased performance-based compensation of $9.3 million, the retiree benefit cost associated with the execution of the Steelworkers agreement in Milwaukee of $5.3 million and increased product development, selling and administrative expense of $24.2 million. The return on sales percentage in the fiscal 2008 nine months of 14.9%, decreased from 18.6% in the prior year nine months largely as a result of the increased product development, selling and administrative cost, the termination of the repair and maintenance contract and mix of greater original equipment sales.

Operating income for Crushing & Conveying included $16.9 million of purchase accounting charges.

Corporate expense increased by $4.1 million due to increased performance-based compensation, legal fees and severance costs.

The eliminations represent the Stamler crushing equipment which are sold through the Underground Mining Machinery segment but managed as part of the Crushing & Conveying segment.

Product Development, Selling and Administrative Expense

Product development, selling and administrative expense totaled $323.0 million, or 13.5% of sales, in the fiscal 2008 nine months, as compared to $259.8 million, or 14.3% of sales, in the fiscal 2007 nine months. Increased product development, selling and administrative expense was attributable to $13.2 million of higher selling expenses related to increased business activity, $19.2 million related to the Continental acquisition, $10.6 million of increased performance-based compensation, $7.2 million of unfavorable foreign currency fluctuations, and $6.2 million of increased product development activities.

Provision for Income Taxes

The provision for income taxes for the fiscal 2008 nine months decreased to $87.0 million as compared to $95.9 million for the fiscal 2007 nine months. On a consolidated basis, these income tax provisions represented effective income tax rates for the fiscal 2008 nine months and fiscal 2007 nine months of 25.4% and 31.3%, respectively. On a recurring basis, the main drivers of the variance in tax rates between periods and in relation to the U.S. statutory rate of 35% were the geographic mix of earnings with the corresponding differences in foreign statutory tax rates and the utilization of tax credits and tax holidays offset by U.S. State income taxes. Additionally, a discrete net tax benefit of $23.4 million was recorded in the nine months of 2008 primarily related to U.S. foreign tax credits available for future utilization. Through the third quarter of 2007, a discrete net tax benefit of $4.5 million was recorded relating to the true-up of prior years’ tax provision and certain U.S. Subpart F inclusions.

Cash taxes paid for the fiscal 2008 nine months were $99.9 million, or 29.2% of pre-tax income, compared to $47.5 million, or 15.5% of pre-tax income, paid for the fiscal 2007 nine months. This increase in cash taxes paid was primarily due to increased U.S. and international profitability year over year and limited net operating losses available to offset taxable income in the U.S. offset partially by the utilization of tax credits and holidays.

Bookings and Backlog

Bookings for the quarter and nine months ended August 1, 2008 and July 27, 2007, respectively, are the following:

		Quarter Ended				Nine Months Ended
		August 1,		July 27,		August 1,		July 27,
		2008		2007		2008		2007

Underground Mining Machinery	$	742,746	$	393,362	$	1,847,694	$	1,103,897
Surface Mining Equipment		645,068		235,065		1,555,557		817,865
Crushing & Conveying		126,494		-		263,916		-
Eliminations		(13,862)		-		(64,546)		-
Total Bookings	$	1,500,446	$	628,427	$	3,602,621	$	1,921,762

Bookings in the quarter totaled $1.5 billion, an increase of 139% from the $628 million in total orders in the prior year’s quarter reflecting continued international market strength and the resurgence of the U.S. underground coal market. Original equipment orders were up over 340% while aftermarket orders were up over 40%.

Underground orders increased almost 90% to a record $743 million in the quarter, with original equipment orders being led by continuous miners in the United States and over 50% aftermarket order increases in the United States and Australasia.

Surface orders increased almost 175% to a record level of $645 million in the quarter. Original equipment orders were led by electric mining shovels in North and South America and Australasia while aftermarket orders grew in all markets worldwide.

The business associated with the Continental acquisition contributed $113 million to bookings in the third quarter led by significant orders in the United States, Australasia and Eurasia.

Due to the continued strength of the surface mining business and the surging U.S. underground coal market, backlog increased from $1.6 billion at the end of fiscal 2007 to $3.0 billion at the end of the fiscal 2008 third quarter.

Liquidity and Capital Resources

The following table summarizes the major components of our working capital as of August 1, 2008 and October 26, 2007, respectively:

		August 1,		October 26,
In millions		2008		2007
Cash and cash equivalents	$	306.9	$	173.2
Accounts receivable		601.9		560.2
Inventories		892.6		727.4
Other current assets		123.0		77.0
Short-term debt		(18.5)		(0.2)
Accounts payable		(268.4)		(199.2)
Employee compensation and benefits		(99.8)		(59.5)
Advance payments and progress billings		(466.0)		(324.1)
Accrued warranties		(50.4)		(49.4)
Other current liabilities		(126.9)		(121.1)

Working Capital	$	894.4	$	784.3

We currently use working capital and cash flow as two financial measurements to evaluate the performance of our operations and our ability to meet our financial obligations. We continue to require working capital investment to maintain our position as a leading manufacturer and servicer of high productivity mining equipment. The primary drivers of these requirements are funding for purchases of production and replacement parts inventories. Our position as a market leader in providing timely service and repair requires us to maintain a certain level of replacement parts. As part of our continuous improvement of purchasing and manufacturing processes, we continue to strive for alignment of inventory levels with customer demand and current production schedules.

We continue to anticipate that capital spending will be 3.5% to 4.0% of sales primarily due to a number of programs to increase our manufacturing capacity and to continue the expansion of our aftermarket service capabilities.

Expansion efforts continued at our surface mining operations during the third quarter. Efforts continued on a $48.0 million, 130,000 square foot expansion in proprietary component machining capabilities for P&H Mining

at our Tianjin, China campus, with first piece runoff of currently installed equipment completed early in the fourth quarter of fiscal 2008, with full production targeted for the second half of 2009. The next phase of our expansion will be an approximately 150,000 square foot facility in Tianjin, China and will give us further transmission assembly capabilities. We also plan to expand repair and rebuild capabilities in Alberta, Canada to support the increasing oil sands investments. We also will be consolidating and expanding repair and rebuild capabilities in the Iron Range region in Minnesota. Outsourcing arrangements continue to expand for certain non-proprietary P&H components, such as large fabrications, in areas of the world in which the products are ultimately destined.

During the fiscal 2008 nine months, cash provided by operating activities was $334.5 million compared to cash provided by operating activities of $210.3 million during the fiscal 2007 nine months. The increase was primarily associated with greater emphasis on obtaining advanced payments and progress billings for long-lead time equipment and machinery combined with certain global initiatives focused on working capital management.

During the fiscal 2008 nine months, cash used by investing activities was $301.4 million compared to cash used by investing activities of $52.1 million during the fiscal 2007 nine months. The increase in cash used by investing activities was primarily due to the $252.1 million acquisition of Continental in the second quarter of fiscal 2008. This cash usage was partially offset by proceeds from the collection of a note receivable related to the fiscal 2006 sale of The Horsburgh & Scott Company of $9.9 million which was collected in the first quarter of 2008.

During the fiscal 2008 nine months, cash provided by financing activities was $100.6 million compared to cash used by financing activities of $146.5 million in the fiscal 2007 nine months. The primary drivers of the change were the $175 million term loan associated with the Second Amendment to our existing credit facility the proceeds of which were used in the acquisition of Continental and decreased purchases of common stock associated with our share repurchase program, which were primarily funded in 2007 through our issuance of Senior Notes.

Continental Acquisition

On February 14, 2008 we completed the previously announced acquisition of N.E.S. Investment Co. (“Parent”) and thereby its subsidiary, Continental Global Group, Inc. (“Continental”) a worldwide leader in conveyor systems for bulk material handling in mining and industrial applications. The Continental acquisition further strengthens our ability to provide a more complete mining solution to our customers. We purchased all of the outstanding shares of the Parent for an aggregate amount of $252.1 million, which is net of approximately $5.9 million of indebtedness assumed by us at closing and $12.0 million of cash acquired. We also incurred $1.9 million of direct acquisition costs related to the acquisition. The purchase price was funded in part through available cash and credit resources and a $175.0 million term loan.

The Second Amendment calls for quarterly principal payments of 2.5% of the initial term loan through October 31, 2011, and at which time the remaining outstanding principal equal to 62.5% of the initial term loan

is due. Initial outstanding borrowings bear interest equal to the Base Rate and thereafter based on LIBOR plus the applicable spread. As part of the Second Amendment, we may request an increase to the term loan outstanding not to exceed $75.0 million. No changes were made to existing financial covenants.

As part of the Continental acquisition, the reportable segments for Joy Global Inc. were reevaluated and a new segment was created, Crushing & Conveying. Included in the Crushing & Conveying segment is the entire acquired Continental entity, along with the Stamler crushing equipment business, which was acquired in the fourth quarter of fiscal 2006. The Stamler crushing equipment is currently being sold through the Underground Mining Machinery or Surface Mining Equipment segments to third parties, but is being supplied to each unit through the Crushing & Conveying segment.

Contract Termination

Financial Condition

As of the end of the third quarter fiscal 2008, we had $306.9 million in cash and cash equivalents and $250.0 million available for borrowings under the Credit Agreement. Our primary cash requirements include working capital, capital expenditures, dividends and share repurchases. We will also continue to evaluate potential acquisitions. Target acquisitions would include “bolt-on” businesses which would be mining-related product line additions or service extensions or businesses that would provide a strong branded, highly engineered product with the platform for our life-cycle management strategy and provide a solid base for growth potential. Based upon our current level of operations, we believe that cash flows from operations, together with available borrowings under the Credit Agreement, will be adequate to meet our anticipated future cash requirements.

Recent Accounting Pronouncements

Our new accounting pronouncements are set forth under Part I, Item 1 of this Form 10-Q and are incorporated by reference.

Off-Balance Sheet Arrangements

We lease various assets under operating leases. No significant changes to lease commitments have occurred since our fiscal year ended October 26, 2007. We have no other off-balance sheet arrangements, other than noted in Note 8 to the Condensed Consolidated Financial Statements.

Critical Accounting Estimates, Assumptions and Policies

Our discussion and analysis of financial condition and results of operations is based upon our Condensed Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these Condensed Consolidated Financial Statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses, and related disclosure of contingent assets and liabilities. We evaluate, on an ongoing basis, our estimates and judgments, including those related to bad debts, excess inventory, warranty, intangible assets, income taxes, and contingencies. We base our estimates on historical experience and assumptions that we believe to be reasonable under the circumstances. Actual results may differ from these estimates.

We believe our accounting policies for revenue recognition, inventories, intangible assets, accrued warranties, pension and postretirement benefits and costs, and income taxes are the ones that most frequently require us to make estimates and judgments, and therefore are critical to the understanding of our results of operations. See Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended October 26, 2007 for a discussion of these policies. There were no material changes to these policies during the third quarter of fiscal 2008.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As more fully described in our Annual Report on Form 10-K for the year ended October 26, 2007, we are exposed to various types of market risks, primarily foreign currency risks. We monitor our risks in this area on a continuous basis and generally enter into forward foreign currency contracts to minimize these exposures for periods of less than one year. We do not engage in speculation in our derivative strategies. Gains and losses from foreign currency contract activities are offset by changes in the underlying costs of the transactions being hedged. There have been no material changes to our primary market risk exposures or how such risks are managed since our fiscal year ended October 26, 2007.

Item 4. Controls and Procedures

We have established disclosure controls and procedures to ensure that material information relating to us, including our consolidated subsidiaries, is made known to the officers who certify our financial reports and to other members of senior management and the Board of Directors.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of such date, our disclosure controls and procedures are effective (1) in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by us in the reports that we file or submit under the Exchange Act and (2) to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

There have not been any changes in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during our fiscal quarter ended August 1, 2008 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

No change.

Item 1A. Risk Factors

Except as set forth below, there have been no material changes from the risk factors disclosed in our Form 10-K since the end of our most recently completed fiscal quarter.

We may not be able to integrate the acquisition of Continental successfully, which may have a material adverse impact on our ability to realize anticipated synergies from the acquisition and our future growth and operating performance.

On February 14, 2008, we completed the acquisition of N.E.S. Investment Co. and its subsidiary, Continental Global Group. The successful integration of Continental will require substantial attention from our management team. The diversion of management attention and any other difficulties we encounter in the integration process could have a material adverse effect on our ability to realize anticipated cost savings and synergies from the acquisition. Difficulties that arise integrating Continental may also have a material adverse effect on our future growth and results of operations. We cannot provide assurance that we will be able to integrate the operations of Continental successfully, that we will be able to fully realize anticipated synergies from the acquisition, or that we will be able to operate Continental’s business successfully.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a)

Not applicable.

(b)

Not applicable.

We made the following purchases of our common stock, par value $1.00 per share, during the period covered by this report:

						Maximum Approximate
						Dollar Value of Shares
				Total Number of Shares		that May Yet Be
	Total Number		Average	Purchased as Part of		Purchased Under the
	of Shares		Price Paid	Publicly Announced		Plans or Programs
Period	Purchased		per Share	Plans or Programs		(in millions)*

May 3, 2008 to	-	$	-	-	$	-
June 2, 2008

June 3, 2008 to	-	$	-	-	$	-
July 2, 2008

July 3, 2008 to	353,800	$	68.91	353,800	$	163.3
August 1, 2008

*All purchases were made under our stock repurchase plan announced on May 31, 2005, which originally authorized the repurchase of $300 million in common stock. On September 12, 2006, the stock repurchase plan was increased to a level of $1 billion and extended until the end of calendar 2008.

Item 3. Defaults upon Senior Securities

Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders

Not applicable.

Item 5. Other Information

Not applicable.

Item 6. Exhibits

31.1	Chief Executive Officer Rule 13a-14(a)/15d-14(a) Certifications
31.2	Chief Financial Officer Rule 13a-14(a)/15d-14(a) Certifications
32	Section 1350 Certifications

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			JOY GLOBAL INC.
			(Registrant)


			/s/ James H. Tate

Date: September 4, 2008			James H. Tate
			Chief Financial Officer






			/s/ Michael S. Olsen

Date: September 4, 2008			Michael S. Olsen
			Vice President and
			Chief Accounting Officer

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Joy Global Inactive 10-Q2008 Q3 Quarterly report

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