Joy Global 10-Q 2014 Q3 Quarterly report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________________ 

FORM 10-Q

____________________________________________ 

(MARK ONE)

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED August 1, 2014

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD fromto

Commission File number 001-09299

____________________________________________  

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  ý    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or such shorter period that the registrant was required to submit and post such files.)    Yes  ý    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- accelerated filer or a smaller reporting company. See definitions of “accelerated filer,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

LARGE ACCELERATED FILER	ý	ACCELERATED FILER	¨
NON-ACCELERATED FILER	¨	SMALLER REPORTING COMPANY	¨

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

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

Class	August 29, 2014
Common Stock, $1 par value	98,175,511

JOY GLOBAL INC.

FORM 10-Q INDEX

August 1, 2014

	PAGE NO.
PART I. – FINANCIAL INFORMATION
Item 1 – Financial Statements
Condensed Consolidated Statements of Income - Quarter and Nine Months Ended August 1, 2014 and July 26, 2013	3
Condensed Consolidated Statements of Comprehensive Income - Quarter and Nine Months Ended August 1, 2014 and July 26, 2013	4
Condensed Consolidated Balance Sheets - August 1, 2014 and October 25, 2013	5
Condensed Consolidated Statements of Cash Flows - Nine Months Ended August 1, 2014 and July 26, 2013	6
Condensed Notes to Interim Consolidated Financial Statements	7
Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3 – Quantitative and Qualitative Disclosures About Market Risk	41
Item 4 – Controls and Procedures	41
PART II. – OTHER INFORMATION
Item 1 – Legal Proceedings	42
Item 1A – Risk Factors	42
Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3 – Defaults Upon Senior Securities	42
Item 4 – Mine Safety Disclosures	42
Item 5 – Other Information	42
Item 6 – Exhibits	43
Signatures	44

Forward-Looking Statements

Certain statements in this Quarterly Report on Form 10-Q, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives and expected operating results and the assumptions on 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, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These statements are identified by forward-looking terms such as "anticipate," "believe," "could," "estimate," "expect," "forecast," "indicate," "intend," "may be," "objective," "plan," "potential," "predict," "should," "will be," and similar expressions. Forward-looking statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from any forward-looking statement. In addition, certain market outlook information and other market statistical data contained herein is based on third party sources that we cannot independently verify, but that we believe to be reliable. 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, risks associated with acquisitions and the risks discussed in Item 1A, Risk Factors, of our Annual Report on Form 10-K for our fiscal year ended October 25, 2013 and in other filings that we make with the U.S. Securities and Exchange Commission (the "SEC"). Any or all of these factors could cause our results of operations, financial condition or liquidity for future periods to differ materially from those expressed in or implied by any forward-looking statement. Furthermore, there may be other factors that could cause our actual results to differ materially from the results referred to in the forward-looking statements. We undertake no obligation to update or revise any forward-looking statements to reflect events or circumstances after the date on which such statements are made or to reflect the occurrence of unanticipated events, except as required by law.

PART I. - FINANCIAL INFORMATION

Item 1. Financial Statements

JOY GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(In thousands, except per share data)

	Quarter Ended						Nine Months Ended
	August 1, 2014			July 26, 2013			August 1, 2014			July 26, 2013
Net sales	$	875,661		$	1,320,611		$	2,644,703		$	3,830,923
Cost of sales	623,729			880,209			1,879,499			2,562,537
Product development, selling and administrative expenses	137,259			167,155			444,822			497,389
Other income	(4,618		)	(1,092		)	(9,896		)	(3,127		)
Operating income	119,291			274,339			330,278			774,124
Interest income	1,707			2,536			6,583			6,180
Interest expense	(16,604		)	(16,138		)	(49,148		)	(50,120		)
Income from continuing operations before income taxes	104,394			260,737			287,713			730,184
Provision for income taxes	33,105			77,550			93,612			223,079
Income from continuing operations	71,289			183,187			194,101			507,105
Loss from discontinued operations, net of income taxes	—			—			—			(225		)
Net income	$	71,289		$	183,187		$	194,101		$	506,880
Basic earnings per share:
Income from continuing operations	$	0.71		$	1.72		$	1.93		$	4.77
Loss from discontinued operations	—			—			—			—
Net income	$	0.71		$	1.72		$	1.93		$	4.77
Diluted earnings per share:
Income from continuing operations	$	0.71		$	1.71		$	1.91		$	4.73
Loss from discontinued operations	—			—			—			—
Net income	$	0.71		$	1.71		$	1.91		$	4.73
Dividends per share	$	0.20		$	0.175		$	0.55		$	0.525
Weighted average shares outstanding:
Basic	99,856			106,465			100,666			106,378
Diluted	100,738			107,312			101,536			107,321

See Notes to Condensed Consolidated Financial Statements.

3

JOY GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

	Quarter Ended
	August 1, 2014			July 26, 2013
Net income	$	71,289		$	183,187
Other comprehensive income (loss):
Change in unrecognized pension and other postretirement obligations, net of (benefits) taxes of ($6,516) and $2,338	(10,176		)	4,888
Derivative instrument fair market value adjustment, net of taxes of $165 and $2,817	425			6,371
Foreign currency translation adjustment	20,145			(54,642		)
Total other comprehensive income (loss), net of taxes	10,394			(43,383		)
Comprehensive income	$	81,683		$	139,804

	Nine Months Ended
	August 1, 2014			July 26, 2013
Net income	$	194,101		$	506,880
Other comprehensive income (loss):
Change in unrecognized pension and other postretirement obligations, net of (benefits) taxes ($3,286) and $7,013	(2,641		)	14,665
Derivative instrument fair market value adjustment, net of taxes of $63 and $24	139			1,165
Foreign currency translation adjustment	(4,327		)	(67,570		)
Total other comprehensive loss, net of taxes	(6,829		)	(51,740		)
Comprehensive income	$	187,272		$	455,140

See Notes to Condensed Consolidated Financial Statements.

4

JOY GLOBAL INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

	August 1, 2014		October 25, 2013
ASSETS
Current assets:
Cash and cash equivalents	$	308,042	$	405,709
Accounts receivable, net	890,838		1,083,663
Inventories	1,211,735		1,139,744
Other current assets	187,315		193,328
Total current assets	2,597,930		2,822,444
Property, plant and equipment, net	910,738		912,642
Other assets:
Other intangible assets, net	324,544		331,812
Goodwill	1,516,970		1,480,519
Deferred income taxes	44,890		41,532
Other non-current assets	195,637		200,633
Total other assets	2,082,041		2,054,496
Total assets	$	5,590,709	$	5,789,582
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term notes payable, including current portion of long-term obligations	$	168	$	58,669
Trade accounts payable	356,871		388,119
Employee compensation and benefits	114,351		130,555
Advance payments and progress billings	397,483		399,768
Accrued warranties	63,685		85,732
Other accrued liabilities	229,118		286,063
Current liabilities of discontinued operations	11,581		11,684
Total current liabilities	1,173,257		1,360,590
Long-term obligations	1,269,327		1,256,927
Other liabilities:
Liabilities for postretirement benefits	19,687		20,723
Accrued pension costs	164,449		149,805
Other non-current liabilities	154,003		143,168
Total other liabilities	338,139		313,696
Shareholders’ equity	2,809,986		2,858,369
Total liabilities and shareholders’ equity	$	5,590,709	$	5,789,582

See Notes to Condensed Consolidated Financial Statements.

5

JOY GLOBAL INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	Nine Months Ended
	August 1, 2014			July 26, 2013
Operating Activities:
Net income	$	194,101		$	506,880
Loss from discontinued operations	—			225
Adjustments to continuing operations:
Depreciation and amortization	98,725			79,864
Changes in deferred income taxes	(5,864		)	12,767
Contributions to defined benefit employee pension plans	(5,760		)	(115,412		)
Defined benefit employee pension plan expense	13,575			12,553
Share-based compensation expense	11,204			23,312
Excess tax benefit from share-based compensation awards	(1,727		)	(1,672		)
Changes in long-term receivables	(2,650		)	(65,795		)
Other adjustments to continuing operations, net	(3,829		)	816
Changes in working capital items attributed to continuing operations, net of acquisition:
Accounts receivable, net	214,448			161,529
Inventories	(84,439		)	69,621
Other current assets	12,324			(18,047		)
Trade accounts payable	(29,442		)	(36,178		)
Employee compensation and benefits	(15,291		)	(29,379		)
Advance payments and progress billings	(3,352		)	(152,918		)
Accrued warranties	(21,579		)	(13,856		)
Other accrued liabilities	(72,123		)	8,830
Net cash provided by operating activities of continuing operations	298,321			443,140
Net cash used by operating activities of discontinued operations	(103		)	(1,567		)
Net cash provided by operating activities	298,218			441,573
Investing Activities:
Acquisition of Mining Technologies International Inc.	(47,058		)	—
Property, plant and equipment acquired	(69,068		)	(117,909		)
Proceeds from sale of property, plant and equipment	8,882			2,939
Other investing activities, net	(89		)	(98		)
Net cash used by investing activities	(107,333		)	(115,068		)
Financing Activities:
Common stock issued	10,189			5,461
Excess tax benefit from share-based compensation awards	1,727			1,672
Dividends paid	(55,334		)	(55,726		)
Repayments of term loan	(37,500		)	(37,500		)
Changes in short and other long-term obligations, net	(9,220		)	(5,659		)
Treasury stock purchased	(194,336		)	—
Financing fees	(2,826		)	—
Net cash used by financing activities	(287,300		)	(91,752		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	(1,252		)	(12,576		)
(Decrease) Increase in Cash and Cash Equivalents	(97,667		)	222,177
Cash and Cash Equivalents at Beginning of Period	405,709			263,873
Cash and Cash Equivalents at End of Period	$	308,042		$	486,050

See Notes to Condensed Consolidated Financial Statements.

6

JOY GLOBAL INC.

CONDENSED NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Description of Business

Joy Global Inc. (the "Company") is a leading manufacturer and servicer of high-productivity mining equipment for the extraction of coal and other minerals and ores. We manufacture and market original equipment and parts and perform services for both underground and surface mining, as well as certain industrial applications. Our equipment is used in major mining regions throughout the world to mine coal, copper, iron ore, oil sands, gold and other minerals. We operate in two business segments: Underground Mining Machinery ("Underground") and Surface Mining Equipment ("Surface"). We are a major manufacturer of underground mining machinery for the extraction of coal and other bedded minerals and offer comprehensive service locations near major mining regions worldwide. We are also a major producer of surface mining equipment for the extraction of coal and other minerals and ores and provide extensive operational support for many types of equipment used in surface mining. Our principal manufacturing facilities are located in the United States, including facilities in Alabama, Pennsylvania, Texas and Wisconsin, and internationally, including facilities in Australia, Canada, China, South Africa and the United Kingdom.

2. Basis of Presentation

The Condensed Consolidated Financial Statements presented in this Quarterly Report on Form 10-Q are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to SEC rules and regulations. 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 such adjustments made are of a normal recurring nature. The preparation of the financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual amounts could differ from the estimates.

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 25, 2013. The results of operations for any interim period are not necessarily indicative of the results to be expected for the full year.

3. Acquisitions

Acquisition of Mining Technologies International Inc.

On May 30, 2014, we closed on the purchase of certain assets of Mining Technologies International Inc. ("MTI") for $47.1 million dollars, subject to a working capital adjustment. MTI is a Canadian manufacturer of underground hard rock mining equipment serving the North American markets and a world leading supplier of raise bore drilling consumables. We have acquired substantially all of the assets associated with MTI’s hard rock drilling, loaders, dump trucks, shaft sinking and raise bore product lines. MTI's results of operations have been included in the accompanying financial statements as part of the Underground segment from the acquisition date forward.

In connection with the acquisition, we have preliminarily recorded goodwill of approximately $9.5 million and intangible assets of approximately $6.2 million. The intangible assets are primarily comprised of customer relationships and designs and drawings, which are being amortized over their respective estimated useful lives. The accounting for the purchase price is preliminary and subject to change, as we are in the process of obtaining third party valuations of assets acquired.

4. Inventories

Consolidated inventories consist of the following:

In thousands	August 1, 2014		October 25, 2013
Finished goods	$	877,519	$	838,052
Work in process	258,421		233,303
Raw materials	75,795		68,389
Total inventories	$	1,211,735	$	1,139,744

Finished goods include finished components and parts in addition to any finished equipment.

5. Warranties

7

We provide for the estimated costs that may be incurred under product warranties to remedy deficiencies of quality or performance of our products. Warranty costs are accrued at the time revenue is recognized. These product warranties extend over either a specified period of time, units of production or machine hours depending on the product subject to the warranty. We accrue a provision for estimated future warranty costs based on 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 necessary.

The following table reconciles the changes in the product warranty reserve:

	Quarter Ended						Nine Months Ended
In thousands	August 1, 2014			July 26, 2013			August 1, 2014			July 26, 2013
Balance, beginning of period	$	73,602		$	83,691		$	85,732		$	100,646
Accrual for warranty expensed during the period	7,138			11,577			23,801			36,498
Settlements made during the period	(17,357		)	(8,651		)	(46,533		)	(49,359		)
Effect of foreign currency translation	56			(1,676		)	439			(2,844		)
Acquired warranty accrual	246			—			246			—
Balance, end of period	$	63,685		$	84,941		$	63,685		$	84,941

6. Borrowings and Credit Facilities

On July 29, 2014, we entered into a $1.0 billion unsecured revolving credit facility that matures on July 29, 2019 (as amended, the "Credit Agreement"). Under the Credit Agreement, we also may request an increase of up to $250.0 million of additional aggregate revolving commitments, subject to the terms and conditions contained in the Credit Agreement. The Credit Agreement simultaneously replaced the $1.0 billion revolving credit agreement dated as of October 12, 2012 (the "Prior Credit Agreement"), that was scheduled to expire on November 12, 2017. Under the terms of the Credit Agreement, we pay a commitment fee ranging from 0.09% to 0.30% on the unused portion of the revolving credit facility based on our credit rating. Letters of credit issued under applicable provisions of the Credit Agreement represent an unfunded utilization of the Credit Agreement for purposes of calculating the periodic commitment fee due. Eurodollar rate loans bear interest for a period from the applicable borrowing date until a date one week or one, two, three or six months thereafter, as selected by the Company, at the corresponding Eurodollar rate plus a margin of 1.0% to 2.0% depending on the Company's credit rating. Base rate loans bear interest from the applicable borrowing date at a rate equal to (i) the highest of (a) the federal funds rate plus 0.5%, (b) the rate of interest in effect for such day as publicly announced by the administrative agent as its "prime rate," or (c) a daily rate equal to the one-month Eurodollar rate plus 1.0%, plus (ii) a margin that varies according to the Company's credit rating. Swing line loans bear interest at either the base rate described above or the daily floating Eurodollar rate plus the applicable margin, as selected by the Company. The Credit Agreement is guaranteed by each of our current and future material domestic subsidiaries and requires the maintenance of certain financial covenants, including leverage and interest coverage ratios. The Credit Agreement also restricts payment of dividends or other returns of capital to shareholders when the consolidated leverage ratio exceeds a stated level amount. As of August 1, 2014, we were in compliance with all financial covenants of the Credit Agreement and had no restrictions on the payment of dividends or other returns of capital to shareholders.

As of August 1, 2014, there were no direct borrowings under the Credit Agreement. Outstanding standby letters of credit issued under the Credit Agreement, which count toward the $1.0 billion credit limit, totaled $176.3 million. As of August 1, 2014, there was $823.7 million available for borrowings under the Credit Agreement.

On July 29, 2014, we entered into a term loan agreement which matures July 29, 2019 and provides for a commitment of up to $375.0 million (as amended, the "Term Loan"). The Term Loan amended our prior term loan, dated as of June 16, 2011 (the "Prior Term Loan"). The Prior Term Loan had been scheduled to mature on July 16, 2016 and provided an initial commitment of $500.0 million, which had been drawn in full in conjunction with our fiscal 2011 acquisition of LeTourneau Technologies, Inc. and had been amortized to $375.0 million at the date of amendment. We utilized the $375.0 million commitment under the Term Loan to repay the balance outstanding under the Prior Term Loan. The Term Loan requires quarterly principal payments beginning in fiscal 2016 and contains terms and conditions that are the same as the terms and conditions of the Credit Agreement. The Term Loan is guaranteed by each of our current and future material domestic subsidiaries and requires the maintenance of certain financial covenants, including leverage and interest coverage ratios. As of August 1, 2014, we were in compliance with all financial covenants of the Term Loan.

On October 12, 2011, we issued $500.0 million aggregate principal amount of 5.125% Senior Notes due in 2021 (the "2021 Notes") at a discount of $4.2 million in an offering that was registered under the Securities Act. Interest on the 2021 Notes is paid semi-annually in arrears on October 15 and April 15 of each year, and the 2021 Notes are guaranteed by each of our current and future material domestic subsidiaries. At our option, we may redeem some or all of the 2021 Notes at a redemption price of the

8

greater of 100% of the principal amount of the 2021 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 0.5%.

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 (the "2016 Notes" and "2036 Notes," respectively). Interest on the 2016 Notes and 2036 Notes is paid semi-annually in arrears on May 15 and November 15 of each year, and the 2016 Notes and 2036 Notes are guaranteed by each of our current and future material domestic subsidiaries. The 2016 Notes and 2036 Notes were issued in a private placement under an exemption from registration provided by the Securities Act. In the second quarter of fiscal 2007, the 2016 Notes and 2036 Notes were exchanged for substantially identical notes in an exchange that was registered under the Securities Act. At our option, we may redeem some or all of the 2016 Notes and 2036 Notes at a redemption price of the greater of 100% of the principal amount of the 2016 Notes and 2036 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.

Direct borrowings and capital lease obligations consist of the following:

In thousands	August 1, 2014			October 25, 2013
Domestic:
Term Loan due 2016	$	—		$	412,500
Term Loan due 2019	375,000			—
6.0% Senior Notes due 2016	249,030			248,733
5.125% Senior Notes due 2021	496,713			496,438
6.625% Senior Notes due 2036	148,515			148,493
Other secured borrowings	—			1,212
Foreign:
Capital leases	237			—
Short-term borrowings	—			8,220
Total obligations	1,269,495			1,315,596
Less: Amounts due within one year	(168		)	(58,669		)
Long-term obligations	$	1,269,327		$	1,256,927

7. Accumulated Other Comprehensive (Loss) Income

Comprehensive income and its components are presented in the Condensed Consolidated Statements of Comprehensive Income. Changes in accumulated other comprehensive (loss) income, net of taxes, consist of the following:

9

	Quarter ended August 1, 2014										Quarter ended July 26, 2013
	Change in Unrecognized Pension and Other Postretirement Obligations			Derivative Instrument Fair Market Value Adjustment		Foreign Currency Translation Adjustment		Total			Change in Unrecognized Pension and Other Postretirement Obligations			Derivative Instrument Fair Market Value Adjustment			Foreign Currency Translation Adjustment			Total
Beginning balance	$	(532,587	)	$	4,742	$	2,988	$	(524,857	)	$	(549,681	)	$	(327	)	$	33,002		$	(517,006	)
Other comprehensive income (loss) before reclassifications, net of taxes	(15,202		)	262		20,145		5,205			—			6,842			(54,642		)	(47,800		)
Amounts reclassified from accumulated other comprehensive (loss) income, net of taxes	5,026			163		—		5,189			4,888			(471		)	—			4,417
Total other comprehensive income (loss), net of taxes	(10,176		)	425		20,145		10,394			4,888			6,371			(54,642		)	(43,383		)
Ending balance	$	(542,763	)	$	5,167	$	23,133	$	(514,463	)	$	(544,793	)	$	6,044		$	(21,640	)	$	(560,389	)

	Nine months ended August 1, 2014												Nine months ended July 26, 2013
	Change in Unrecognized Pension and Other Postretirement Obligations			Derivative Instrument Fair Market Value Adjustment			Foreign Currency Translation Adjustment			Total			Change in Unrecognized Pension and Other Postretirement Obligations			Derivative Instrument Fair Market Value Adjustment			Foreign Currency Translation Adjustment			Total
Beginning balance	$	(540,122	)	$	5,028		$	27,460		$	(507,634	)	$	(559,458	)	$	4,879		$	45,930		$	(508,649	)
Other comprehensive (loss) income before reclassifications, net of taxes	(15,202		)	3,555			(4,327		)	(15,974		)	—			3,879			(67,570		)	(63,691		)
Amounts reclassified from accumulated other comprehensive (loss) income, net of taxes	12,561			(3,416		)	—			9,145			14,665			(2,714		)	—			11,951
Total other comprehensive (loss) income, net of taxes	(2,641		)	139			(4,327		)	(6,829		)	14,665			1,165			(67,570		)	(51,740		)
Ending balance	$	(542,763	)	$	5,167		$	23,133		$	(514,463	)	$	(544,793	)	$	6,044		$	(21,640	)	$	(560,389	)

Details of the reclassifications from accumulated other comprehensive (loss) income are disclosed below:

10

	Amounts Reclassified from Accumulated Other Comprehensive (Loss) Income
	Quarter Ended						Nine Months Ended						Affected Line Items in the Statements of Income
	August 1, 2014			July 26, 2013			May 2, 2014			April 26, 2013
Change in unrecognized pension and other postretirement obligations:
Amortization of prior service cost	$	181		$	170		$	539		$	510		Cost of sales/Product development, selling and administrative expense*
Amortization of net actuarial gain	5,544			7,056			15,951			21,168			Cost of sales/Product development, selling and administrative expense*
Curtailment loss attributable to unrecognized prior negotiated enhancements	1,582			—			1,582			—			Cost of sales/Product development, selling and administrative expense*
Deferred tax	(2,281		)	(2,338		)	(5,511		)	(7,013		)	Provision for income taxes
Amounts reclassified from accumulated other comprehensive (loss) income, net of taxes	$	5,026		$	4,888		$	12,561		$	14,665
Derivative instrument fair market value adjustment:
Foreign exchange cash flow hedges	$	227		$	(680	)	$	(4,805	)	$	(4,120	)	Net sales/Cost of sales**
Deferred tax	(64		)	209			1,389			1,406			Provision for income taxes
Amounts reclassified from accumulated other comprehensive (loss) income, net of taxes	$	163		$	(471	)	$	(3,416	)	$	(2,714	)
Total reclassifications for the period	$	5,189		$	4,417		$	9,145		$	11,951

* Amounts are included in the computation of net periodic benefits costs as either cost of sales or product development, selling and administrative expense as appropriate. Refer to Footnote 10, Retiree Benefits, for additional information.

** Amounts are included in either net sales or cost of sales as appropriate. Refer to Footnote 11, Derivatives, for additional information.

8. Shareholders' Equity

In August 2013, our Board of Directors authorized the Company to repurchase up to $1.0 billion in shares of our common stock until August 2016. Under the program, the Company may repurchase shares in the open market in accordance with applicable SEC rules and regulations. During the quarter ended August 1, 2014, we purchased 1,091,602 shares of common stock for approximately $64.8 million. During the nine months ended August 1, 2014, we purchased 3,488,312 shares of common stock for approximately $194.3 million. Since its inception, the Company has repurchased 7,593,312 shares of common stock under the program for approximately $408.4 million, leaving $591.6 million available under the program.

9. Share-Based Compensation

Total share-based compensation (income) expense recognized for the quarters ended August 1, 2014 and July 26, 2013 is$(2.0) million and $5.0 million, respectively. Total share-based compensation expense recognized for the nine months ended August 1, 2014 and July 26, 2013 is $11.2 million and $23.3 million, respectively. The fluctuation in share-based compensation is the result of the adjustment of forfeiture rates and the reassessment of performance related measures in the third quarter of fiscal 2014. The total share-based compensation expense is reflected in our Condensed Consolidated Statements of Cash Flows in operating activities as an add back to net income.

The corresponding deferred taxes recognized related to the share-based compensation is a liability of $0.1 million and an asset of $1.6 million for the quarters ended August 1, 2014 and July 26, 2013, respectively. The corresponding deferred tax asset recognized related to the share-based compensation expense is $3.0 million and $6.8 million for the nine months ended August 1, 2014 and July 26, 2013, respectively.

10. Retiree Benefits

The components of the net periodic benefit cost associated with our pension and other postretirement plans are as follows:

11

	Pension Benefits						Postretirement Benefits
	Quarter Ended						Quarter Ended
In thousands	August 1, 2014			July 26, 2013			August 1, 2014			July 26, 2013
Service cost	$	1,634		$	2,848		$	195		$	270
Interest cost	22,511			19,524			315			292
Expected return on assets	(27,348		)	(25,604		)	(121		)	(106		)
Amortization of:
Prior service cost	148			153			33			17
Actuarial loss (gain)	5,703			7,264			(159		)	(208		)
Curtailment loss	7,838			—			—			—
Net periodic benefit cost	$	10,486		$	4,185		$	263		$	265

	Pension Benefits						Postretirement Benefits
	Nine Months Ended						Nine Months Ended
In thousands	August 1, 2014			July 26, 2013			August 1, 2014			July 26, 2013
Service cost	$	4,672		$	8,543		$	714		$	812
Interest cost	63,810			58,571			959			876
Expected return on assets	(79,747		)	(76,812		)	(415		)	(320		)
Amortization of:
Prior service cost	440			458			99			52
Actuarial loss (gain)	16,562			21,793			(611		)	(625		)
Curtailment loss	7,838			—			—			—
Net periodic benefit cost	$	13,575		$	12,553		$	746		$	795

The actuarial loss (gain) arises from differences in estimates and actual experiences for certain assumptions, including changes in the discount rate and expected return on assets. For the nine months ended August 1, 2014, we contributed $5.8 million to our defined benefit employee pension plans, and we do not expect contributions to exceed $50.0 million for the full fiscal year.

During the current quarter, we substantially completed negotiations with certain of our U.S. bargaining units to freeze their respective defined benefit plans at the end of the calendar year. These actions resulted in a $7.8 million non-cash pension curtailment charge in the current quarter.

11. Derivatives

We are exposed to certain foreign currency risks in the normal course of our global business operations. We enter into derivative contracts that are foreign currency forward contracts to hedge the risks of certain identified and anticipated transactions in currencies other than the functional currency of the respective operating unit. The types of risks hedged are those arising from the variability of future earnings and cash flows caused by fluctuations in foreign currency exchange rates. These contracts are for forecasted transactions and committed receivables and payables denominated in foreign currencies and are not entered into for speculative purposes. Consequently, any market-related losses on the forward contract would be offset by changes in the value of the hedged item, and, as a result, we are generally not exposed to net market risk associated with these instruments.

Each derivative is classified as either a cash flow hedge, a fair value hedge or an undesignated instrument. All derivatives are recorded at fair value on the Condensed Consolidated Balance Sheets under the heading Other current assets or under the heading Other accrued liabilities, as appropriate. Cash flows from fair value and cash flow hedges are classified within the same category as the item being hedged on the Condensed Consolidated Statements of Cash Flows. Cash flows from undesignated derivative instruments are included in operating activities on the Condensed Consolidated Statements of Cash Flows.

For derivative contracts that are designated and qualify as a cash flow hedge, the effective portion of the gain or loss of the derivative contract is recorded as a component of other comprehensive income, net of tax. This amount is reclassified into the income statement on the line associated with the underlying transaction for the periods in which the hedged transaction affects earnings. The amounts recorded in accumulated other comprehensive income for existing cash flow hedges are generally expected to be reclassified into earnings within one year and all of the existing hedges will be reclassified into earnings by October 2015. There was no ineffectiveness related to these derivative contracts for the quarter ended August 1, 2014, and there was a gain of

12

$0.2 million recorded in the Condensed Consolidated Statements of Income related to the ineffectiveness of these derivative contracts for the quarter ended July 26, 2013. There was a gain of less than $0.1 million and a gain of $0.8 million recorded in the Condensed Consolidated Statements of Income related to the ineffectiveness of these derivative contracts for the nine months ended August 1, 2014 and July 26, 2013, respectively.

For derivative contracts that are designated and qualify as a fair value hedge, the gain or loss is recorded in the Condensed Consolidated Statements of Income under the heading Cost of sales. For the quarters ended August 1, 2014 and July 26, 2013, we recorded gains of $0.1 million and $1.0 million, respectively, related to fair value hedges, which were offset by foreign exchange fluctuations of the underlying hedged item. For the nine months ended August 1, 2014 and July 26, 2013, we recorded losses of $0.7 million and $0.2 million, respectively, related to fair value hedges, which were offset by foreign exchange fluctuations of the underlying hedged item.

For derivative contracts entered into to hedge revaluation of net balance sheet exposures in non-functional currency that are not designated as a fair value hedge or a cash flow hedge, the gain or loss is recorded in the Condensed Consolidated Statements of Income under the heading Cost of sales. For the quarters ended August 1, 2014 and July 26, 2013, we recorded gains of $0.1 million and $5.5 million, respectively, related to undesignated hedges, which were offset by foreign exchange fluctuations. For the nine months ended August 1, 2014 and July 26, 2013, we recorded gains of $2.7 million and $2.3 million, respectively, related to undesignated hedges, which were offset by foreign exchange fluctuations.

The following table summarizes the effect of cash flow hedges on the Condensed Consolidated Financial Statements:

In thousands	Effective Portion
	Amount of Gain Recognized in Other Comprehensive Income		Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings
Derivative Hedging Relationship			Location	Amount
Foreign currency forward contracts
Quarter ended August 1, 2014	$	363	Cost of sales	$	(267	)
			Sales	40
Nine months ended August 1, 2014	$	5,007	Cost of sales	$	4,586
			Sales	219
Quarter ended July 26, 2013	$	9,868	Cost of sales	$	1,262
			Sales	(582		)
Nine months ended July 26, 2013	$	5,309	Cost of sales	$	4,884
			Sales	(764		)

We are exposed to credit risk in the event of nonperformance by counterparties to the forward contracts. The terms of the forward contract determine the timing and amounts to be exchanged, and the contract is generally subject to credit risk only when it has a positive fair value.

12. Earnings Per Share

Basic earnings per share is computed by dividing net income by the weighted average number of shares outstanding during each period. Diluted earnings per share is computed similar to basic earnings per share, except that the weighted average number of shares outstanding is increased to include additional shares from the assumed exercise of stock options, performance shares and restricted stock units, if dilutive.

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

13

	Quarter Ended				Nine Months Ended
In thousands, except per share amounts	August 1, 2014		July 26, 2013		August 1, 2014		July 26, 2013
Numerator:
Income from continuing operations	$	71,289	$	183,187	$	194,101	$	507,105
Loss from discontinued operations, net of income taxes	—		—		—		(225		)
Net income	$	71,289	$	183,187	$	194,101	$	506,880
Denominator:
Weighted average shares outstanding	99,856		106,465		100,666		106,378
Dilutive effect of stock options, performance shares and restricted stock units	882		847		870		943
Weighted average shares outstanding assuming dilution	100,738		107,312		101,536		107,321
Basic earnings per share:
Income from continuing operations	$	0.71	$	1.72	$	1.93	$	4.77
Loss from discontinued operations	—		—		—		—
Net income	$	0.71	$	1.72	$	1.93	$	4.77
Diluted earnings per share:
Income from continuing operations	$	0.71	$	1.71	$	1.91	$	4.73
Loss from discontinued operations	—		—		—		—
Net income	$	0.71	$	1.71	$	1.91	$	4.73

Options to purchase a weighted average of 1.7 million and 1.6 million shares were excluded from the calculations of diluted earnings per share for the quarters ended August 1, 2014 and July 26, 2013, respectively, as the effect would have been antidilutive. Options to purchase a weighted average of 1.8 million and 1.3 million shares were excluded from the calculations of diluted earnings per share for the nine months ended August 1, 2014 and July 26, 2013, respectively, as the effect would have been antidilutive.

13. Fair Value Measurements

GAAP establishes a three-level fair value hierarchy that prioritizes information used in developing assumptions when pricing an asset or liability as follows:

Level 1: Quoted prices in active markets for identical instruments;

Level 2: Inputs, other than quoted prices in active markets, that are observable for the instrument either directly or indirectly or quoted prices for similar instruments in active markets; and

Level 3: Unobservable inputs for the instrument where there is little or no market data, which requires the reporting entity to develop its own assumptions.

GAAP requires the use of observable market data, when available, in making fair value measurements. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement.

The following tables present the fair value hierarchy for those assets and liabilities measured at fair value and disclose the fair value of long-term obligations recorded at cost as of August 1, 2014 and October 25, 2013. As of August 1, 2014 and October 25, 2013, we did not have any Level 3 assets or liabilities.

14

Fair Value Measurements as of August 1, 2014
In thousands	Carrying Value		Total Fair Value		Level 1		Level 2
Current Assets
Cash equivalents	$	20,221	$	20,221	$	20,221	$	—
Other Current Assets
Derivatives	$	7,297	$	7,297	$	—	$	7,297
Other Accrued Liabilities
Derivatives	$	3,726	$	3,726	$	—	$	3,726
Long-term Obligations Including Amounts due within One Year
Term Loan due 2019	$	375,000	$	381,441	$	—	$	381,441
6.0% Senior Notes due 2016	$	249,030	$	275,375	$	—	$	275,375
5.125% Senior Notes due 2021	$	496,713	$	543,250	$	—	$	543,250
6.625% Senior Notes due 2036	$	148,515	$	176,220	$	—	$	176,220

Fair Value Measurements as of October 25, 2013
In thousands	Carrying Value		Total Fair Value		Level 1		Level 2
Current Assets
Cash equivalents	$	29,221	$	29,221	$	29,221	$	—
Other Current Assets
Derivatives	$	9,593	$	9,593	$	—	$	9,593
Other Accrued Liabilities
Derivatives	$	6,608	$	6,608	$	—	$	6,608
Long-term Obligations Including Amounts due within One Year
Term Loan due 2016	$	412,500	$	432,952	$	—	$	432,952
6.0% Senior Notes due 2016	$	248,733	$	280,425	$	—	$	280,425
5.125% Senior Notes due 2021	$	496,438	$	531,400	$	—	$	531,400
6.625% Senior Notes due 2036	$	148,493	$	165,600	$	—	$	165,600

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

Cash equivalents: The carrying value of cash equivalents approximates fair value based on the short-term nature of these instruments.

Derivatives: The fair value of forward foreign exchange contracts is based on a valuation model that discounts cash flows resulting from the differential between the contract price and the market-based forward rate.

Term Loan: The fair value of the Term Loan is estimated using discounted cash flows and market conditions.

Senior Notes: The fair market value of the senior notes is estimated based on market quotations of similar instruments at the respective period end.

14. 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 approximately 3,050 asbestos and silica-related cases), employment and commercial matters. We and our subsidiaries also become involved from time to time in proceedings relating to environmental matters. In addition, as a normal part of 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 our 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.

As of August 1, 2014, we were contingently liable to financial institutions and others for approximately $206.9 million for outstanding standby letters of credit, surety bonds and bank guarantees to secure the performance of sales contracts and other

15

guarantees in the ordinary course of business. Of the $206.9 million, approximately $27.7 million relates to surety bonds and $2.7 million relates to outstanding letters of credit or other guarantees issued by non-U.S. banks for non-U.S. subsidiaries under locally provided credit facilities.

15. Segment Information

We operate in two reportable segments: Underground and Surface. Crushing and conveying operating results related to surface applications are reported as part of the Surface segment, while total crushing and conveying operating results are included in the Underground segment. Eliminations primarily consist of the surface applications of crushing and conveying included in both operating segments. The results of operations for MTI have been included in the Underground segment from the acquisition date forward.

Operating income (loss) of segments does not include interest income and expense, corporate administration expenses and the provision for income taxes.

In thousands	Underground		Surface		Corporate			Eliminations			Total
Quarter ended August 1, 2014
Net sales	$	470,747	$	435,186	$	—		$	(30,272	)	$	875,661
Operating income (loss)	$	47,635	$	87,269	$	(7,039	)	$	(8,574	)	$	119,291
Interest income	—		—		1,707			—			1,707
Interest expense	—		—		(16,604		)	—			(16,604		)
Income (loss) from continuing operations before income taxes	$	47,635	$	87,269	$	(21,936	)	$	(8,574	)	$	104,394
Depreciation and amortization	$	18,568	$	14,625	$	695		$	—		$	33,888
Capital expenditures	$	12,675	$	10,078	$	2,011		$	—		$	24,764
Quarter ended July 26, 2013
Net sales	$	722,748	$	640,919	$	—		$	(43,056	)	$	1,320,611
Operating income (loss)	$	138,225	$	157,353	$	(10,601	)	$	(10,638	)	$	274,339
Interest income	—		—		2,536			—			2,536
Interest expense	—		—		(16,138		)	—			(16,138		)
Income (loss) from continuing operations before income taxes	$	138,225	$	157,353	$	(24,203	)	$	(10,638	)	$	260,737
Depreciation and amortization	$	17,419	$	12,825	$	747		$	—		$	30,991
Capital expenditures	$	9,877	$	18,029	$	3,002		$	—		$	30,908

16

In thousands	Underground		Surface		Corporate			Eliminations			Total
Nine months ended August 1, 2014
Net sales	$	1,466,088	$	1,279,507	$	—		$	(100,892	)	$	2,644,703
Operating income (loss)	$	177,773	$	216,034	$	(35,464	)	$	(28,065	)	$	330,278
Interest income	—		—		6,583			—			6,583
Interest expense	—		—		(49,148		)	—			(49,148		)
Income (loss) from continuing operations before income taxes	$	177,773	$	216,034	$	(78,029	)	$	(28,065	)	$	287,713
Depreciation and amortization	$	54,780	$	41,834	$	2,111		$	—		$	98,725
Capital expenditures	$	31,653	$	33,446	$	3,969		$	—		$	69,068
Nine months ended July 26, 2013
Net sales	$	1,994,772	$	1,959,198	$	—		$	(123,047	)	$	3,830,923
Operating income (loss)	$	387,330	$	458,676	$	(40,080	)	$	(31,802	)	$	774,124
Interest income	—		—		6,180			—			6,180
Interest expense	—		—		(50,120		)	—			(50,120		)
Income (loss) from continuing operations before income taxes	$	387,330	$	458,676	$	(84,020	)	$	(31,802	)	$	730,184
Depreciation and amortization	$	40,182	$	37,504	$	2,178		$	—		$	79,864
Capital expenditures	$	61,682	$	50,417	$	5,810		$	—		$	117,909

16. Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09 Revenue from Contracts with Customers. ASU 2014-09 provides a single principles-based, five-step model to be applied to all contracts with customers. The five steps are to (i) identify the contracts with the customer, (ii) identify the performance obligations in the contact, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when each performance obligation is satisfied. Revenue will be recognized when promised goods or services are transferred to the customer in an amount that reflects the consideration expected in exchange for those goods or services. ASU 2014-09 will be effective for the Company beginning on October 28, 2017 and the standard allows for either full retrospective adoption or modified retrospective adoption. The Company is continuing to evaluate the impact that the adoption of this guidance will have on our financial condition, results of operations and the presentation of our financial statements.

In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. ASU No. 2013-02 requires presentation, either in a single note or parenthetically on the face of the financial statements, of the effect of significant amounts reclassified from each component of accumulated other comprehensive income based on its source and the income statement line items affected by the reclassification. If a component is not required to be reclassified to net income in its entirety, cross references to the related footnote for additional information would be appropriate. ASU 2013-02 was effective for the Company beginning on October 26, 2013. The adoption of this guidance had no impact on our financial condition or results of operations but impacted the presentation of other comprehensive income in the footnotes of the financial statements.

17. Subsidiary Guarantors

The following tables present condensed consolidated financial information as of August 1, 2014 and October 25, 2013 and for the quarters and nine months ended August 1, 2014 and July 26, 2013 for: (a) the Company; (b) on a combined basis, the guarantors of the 2016 Notes and 2036 Notes issued in November 2006, which include the significant domestic operations of Joy Global Underground Mining LLC, Joy Global Surface Mining Inc., N.E.S. Investment Co., Joy Global Conveyors Inc., Joy Global Longview Operations LLC and certain immaterial wholly owned subsidiaries of Joy Global Longview Operations LLC (the "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 (the "Non-Guarantor Subsidiaries").

The borrowings are fully and unconditionally guaranteed on a joint and several unsecured basis by the Subsidiary Guarantors, which are direct and indirect 100% owned subsidiaries of the Company. We conduct all of our business and derive essentially all of our income from our subsidiaries. Therefore, our ability to make payments on the obligations is dependent on the earnings and distribution of funds from our subsidiaries. There are no restrictions on the ability of any of our domestic subsidiaries to transfer

17

funds to the parent company. Separate financial statements of the Subsidiary Guarantors are not presented because we believe such separate statements or disclosures would not be useful to investors.

Condensed Consolidating Statement of Income Quarter ended August 1, 2014
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	523,862		$	560,533		$	(208,734	)	$	875,661
Cost of sales	—			381,527			411,714			(169,512		)	623,729
Product development, selling and administrative expenses	7,017			49,531			80,711			—			137,259
Other (income) expense	—			2,344			(6,962		)	—			(4,618		)
Operating income (loss)	(7,017		)	90,460			75,070			(39,222		)	119,291
Intercompany items	15,641			(14,897		)	(7,048		)	6,304			—
Interest (expense) income, net	(15,614		)	1,083			(366		)	—			(14,897		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(6,990		)	76,646			67,656			(32,918		)	104,394
Provision (benefit) for income taxes	(5,923		)	32,719			6,330			(21		)	33,105
Equity in income of subsidiaries	72,356			25,017			—			(97,373		)	—
Income from continuing operations	$	71,289		$	68,944		$	61,326		$	(130,270	)	$	71,289
Comprehensive income	$	81,683		$	69,038		$	80,787		$	(149,825	)	$	81,683

Condensed Consolidating Statement of Income Quarter ended July 26, 2013
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	707,663		$	1,007,889		$	(394,941	)	$	1,320,611
Cost of sales	—			488,431			717,550			(325,772		)	880,209
Product development, selling and administrative expenses	10,564			77,590			79,001			—			167,155
Other (income) expense	—			8,675			(9,767		)	—			(1,092		)
Operating income (loss)	(10,564		)	132,967			221,105			(69,169		)	274,339
Intercompany items	28,719			(23,009		)	(41,956		)	36,246			—
Interest (expense) income, net	(16,097		)	1,102			1,393			—			(13,602		)
Income from continuing operations before income taxes and equity in income of subsidiaries	2,058			111,060			180,542			(32,923		)	260,737
Provision (benefit) for income taxes	(16,484		)	66,875			27,159			—			77,550
Equity in income of subsidiaries	164,645			48,563			—			(213,208		)	—
Income from continuing operations	$	183,187		$	92,748		$	153,383		$	(246,131	)	$	183,187
Comprehensive income	$	139,804		$	93,607		$	107,071		$	(200,678	)	$	139,804

18

Condensed Consolidating Statement of Income Nine months ended August 1, 2014
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	1,504,843		$	1,793,900		$	(654,040	)	$	2,644,703
Cost of sales	—			1,115,516			1,301,028			(537,045		)	1,879,499
Product development, selling and administrative expenses	35,840			184,036			224,946			—			444,822
Other (income) expense	(473		)	8,496			(17,919		)	—			(9,896		)
Operating income (loss)	(35,367		)	196,795			285,845			(116,995		)	330,278
Intercompany items	48,422			(60,625		)	(19,053		)	31,256			—
Interest (expense) income, net	(47,495		)	4,679			251			—			(42,565		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(34,440		)	140,849			267,043			(85,739		)	287,713
Provision (benefit) for income taxes	(15,855		)	88,939			20,528			—			93,612
Equity in income of subsidiaries	212,686			105,984			—			(318,670		)	—
Income from continuing operations	$	194,101		$	157,894		$	246,515		$	(404,409	)	$	194,101
Comprehensive income	$	187,272		$	159,288		$	240,592		$	(399,880	)	$	187,272

Condensed Consolidating Statement of Income Nine months ended July 26, 2013
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	2,125,416		$	2,783,893		$	(1,078,386	)	$	3,830,923
Cost of sales	—			1,477,877			1,961,080			(876,420		)	2,562,537
Product development, selling and administrative expenses	39,974			231,533			225,882			—			497,389
Other (income) expense	—			24,636			(27,763		)	—			(3,127		)
Operating income (loss)	(39,974		)	391,370			624,694			(201,966		)	774,124
Intercompany items	86,728			(66,824		)	(104,489		)	84,585			—
Interest (expense) income, net	(49,022		)	1,676			3,406			—			(43,940		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(2,268		)	326,222			523,611			(117,381		)	730,184
Provision (benefit) for income taxes	(37,121		)	190,740			69,460			—			223,079
Equity in income of subsidiaries	472,252			245,173			—			(717,425		)	—
Income from continuing operations	$	507,105		$	380,655		$	454,151		$	(834,806	)	$	507,105
Comprehensive income	$	455,140		$	377,904		$	390,310		$	(768,214	)	$	455,140

19

Condensed Consolidating Balance Sheet As of August 1, 2014
In thousands	Parent Company			Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	35,061		$	7,023	$	265,958	$	—		$	308,042
Accounts receivable, net	—			388,539		517,012		(14,713		)	890,838
Inventories	—			497,772		823,590		(109,627		)	1,211,735
Other current assets	65,908			7,391		114,001		15			187,315
Total current assets	100,969			900,725		1,720,561		(124,325		)	2,597,930
Property, plant and equipment, net	19,939			352,312		541,304		(2,817		)	910,738
Other assets:
Other intangible assets, net	—			233,878		90,666		—			324,544
Goodwill	—			453,375		1,063,595		—			1,516,970
Deferred income taxes	(23,013		)	—		67,903		—			44,890
Other non-current assets	4,188,375			1,970,602		2,700,337		(8,663,677		)	195,637
Total other assets	4,165,362			2,657,855		3,922,501		(8,663,677		)	2,082,041
Total assets	$	4,286,270		$	3,910,892	$	6,184,366	$	(8,790,819	)	$	5,590,709
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term notes payable, including current portion of long-term obligations	$	—		$	—	$	168	$	—		$	168
Trade accounts payable	1,294			188,844		166,733		—			356,871
Employee compensation and benefits	8,863			53,112		52,376		—			114,351
Advance payments and progress billings	—			126,478		289,283		(18,278		)	397,483
Accrued warranties	—			18,319		45,366		—			63,685
Other accrued liabilities	35,275			52,031		148,447		(6,635		)	229,118
Current liabilities of discontinued operations	—			11,581		—		—			11,581
Total current liabilities	45,432			450,365		702,373		(24,913		)	1,173,257
Long-term obligations	1,269,258			—		69		—			1,269,327
Other liabilities:
Liabilities for postretirement benefits	18,827			860		—		—			19,687
Accrued pension costs	152,146			5,207		7,096		—			164,449
Other non-current liabilities	(9,379		)	7,872		155,510		—			154,003
Total other liabilities	161,594			13,939		162,606		—			338,139
Shareholders’ equity	2,809,986			3,446,588		5,319,318		(8,765,906		)	2,809,986
Total liabilities and shareholders’ equity	$	4,286,270		$	3,910,892	$	6,184,366	$	(8,790,819	)	$	5,590,709

20

Condensed Consolidating Balance Sheet As of October 25, 2013
In thousands	Parent Company			Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	122,901		$	20,361	$	262,447	$	—		$	405,709
Accounts receivable, net	—			410,928		679,183		(6,448		)	1,083,663
Inventories	—			456,345		813,182		(129,783		)	1,139,744
Other current assets	68,792			16,957		107,564		15			193,328
Total current assets	191,693			904,591		1,862,376		(136,216		)	2,822,444
Property, plant and equipment, net	18,081			375,026		519,535		—			912,642
Other assets:
Other intangible assets, net	—			247,200		84,612		—			331,812
Goodwill	—			454,199		1,026,320		—			1,480,519
Deferred income taxes	(49,393		)	—		90,925		—			41,532
Other non-current assets	4,168,916			2,065,239		3,968,205		(10,001,727		)	200,633
Total other assets	4,119,523			2,766,638		5,170,062		(10,001,727		)	2,054,496
Total assets	$	4,329,297		$	4,046,255	$	7,551,973	$	(10,137,943	)	$	5,789,582
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term notes payable, including current portion of long-term obligations	$	50,000		$	449	$	8,220	$	—		$	58,669
Trade accounts payable	2,565			165,691		219,863		—			388,119
Employee compensation and benefits	10,080			52,260		68,215		—			130,555
Advance payments and progress billings	—			144,853		269,628		(14,713		)	399,768
Accrued warranties	—			30,111		55,621		—			85,732
Other accrued liabilities	24,545			54,285		211,074		(3,841		)	286,063
Current liabilities of discontinued operations	—			11,684		—		—			11,684
Total current liabilities	87,190			459,333		832,621		(18,554		)	1,360,590
Long-term obligations	1,256,164			763		—		—			1,256,927
Other liabilities:
Liabilities for postretirement benefits	19,881			842		—		—			20,723
Accrued pension costs	136,886			5,685		7,234		—			149,805
Other non-current liabilities	(29,193		)	7,851		164,510		—			143,168
Total other liabilities	127,574			14,378		171,744		—			313,696
Shareholders’ equity	2,858,369			3,571,781		6,547,608		(10,119,389		)	2,858,369
Total liabilities and shareholders’ equity	$	4,329,297		$	4,046,255	$	7,551,973	$	(10,137,943	)	$	5,789,582

21

Condensed Consolidating Statement of Cash Flows Nine months ended August 1, 2014
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Consolidated
Operating Activities:
Net cash provided (used) by operating activities of continuing operations	$	194,291		$	(4,062	)	$	108,092		$	298,321
Net cash used by operating activities of discontinued operations	—			(103		)	—			(103		)
Net cash provided (used) by operating activities	194,291			(4,165		)	108,092			298,218
Investing Activities:
Acquisition of Mining Technologies International Inc.	—			—			(47,058		)	(47,058		)
Property, plant and equipment acquired	(3,969		)	(15,317		)	(49,782		)	(69,068		)
Proceeds from sale of property, plant and equipment	—			7,124			1,758			8,882
Other investing activities, net	(82		)	232			(239		)	(89		)
Net cash used by investing activities	(4,051		)	(7,961		)	(95,321		)	(107,333		)
Financing Activities:
Common stock issued	10,189			—			—			10,189
Excess tax benefit from share-based compensation awards	1,727			—			—			1,727
Dividends paid	(55,334		)	—			—			(55,334		)
Repayments of term loan	(37,500		)	—			—			(37,500		)
Changes in short and long-term obligations, net	—			(1,212		)	(8,008		)	(9,220		)
Treasury stock purchased	(194,336		)	—			—			(194,336		)
Financing fees	(2,826		)	—			—			(2,826		)
Net cash used by financing activities	(278,080		)	(1,212		)	(8,008		)	(287,300		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			—			(1,252		)	(1,252		)
(Decrease) Increase in Cash and Cash Equivalents	(87,840		)	(13,338		)	3,511			(97,667		)
Cash and Cash Equivalents at Beginning of Period	122,901			20,361			262,447			405,709
Cash and Cash Equivalents at End of Period	$	35,061		$	7,023		$	265,958		$	308,042

22

Condensed Consolidating Statement of Cash Flows Nine months ended July 26, 2013
In thousands	Parent Company			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Consolidated
Operating Activities:
Net cash provided by operating activities of continuing operations	$	277,846		$	52,180		$	113,114		$	443,140
Net cash used by operating activities of discontinued operations	—			(1,567		)	—			(1,567		)
Net cash provided by operating activities	277,846			50,613			113,114			441,573
Investing Activities:
Property, plant and equipment acquired	(5,810		)	(29,353		)	(82,746		)	(117,909		)
Proceeds from sale of property, plant and equipment	—			1,272			1,667			2,939
Other investing activities, net	(98		)	—			—			(98		)
Net cash used by investing activities	(5,908		)	(28,081		)	(81,079		)	(115,068		)
Financing Activities:
Common stock issued	5,461			—			—			5,461
Excess tax benefit from share-based compensation awards	1,672			—			—			1,672
Dividends paid	(55,726		)	—			—			(55,726		)
Repayments of term loan	(37,500		)	—			—			(37,500		)
Changes in short and long-term obligations, net	—			(316		)	(5,343		)	(5,659		)
Net cash used by financing activities	(86,093		)	(316		)	(5,343		)	(91,752		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			—			(12,576		)	(12,576		)
Increase in Cash and Cash Equivalents	185,845			22,216			14,116			222,177
Cash and Cash Equivalents at Beginning of Period	3,459			6,628			253,786			263,873
Cash and Cash Equivalents at End of Period	$	189,304		$	28,844		$	267,902		$	486,050

18. Supplemental Subsidiary Guarantors

The following tables present condensed consolidated financial information as of August 1, 2014 and October 25, 2013 and for the quarters and nine months ended August 1, 2014 and July 26, 2013 for: (a) the Company; (b) on a combined basis, the guarantors of the Credit Agreement, the Term Loan and the 2021 Notes issued in October 2011, which include Joy Global Underground Mining LLC, Joy Global Surface Mining Inc., N.E.S. Investment Co., Joy Global Conveyors Inc. and Joy Global Longview Operations LLC (the "Supplemental 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").

The borrowings are fully and unconditionally guaranteed on a joint and several unsecured basis by the Supplemental Subsidiary Guarantors, which are direct and indirect 100% owned subsidiaries of the Company. We conduct all of our business and derive essentially all of our income from our subsidiaries. Therefore, our ability to make payments on the obligations is dependent on the earnings and distribution of funds from our subsidiaries. There are no restrictions on the ability of any of our domestic subsidiaries to transfer funds to the parent company. Separate financial statements of the Supplemental Subsidiary Guarantors are not presented because we believe such separate statements or disclosures would not be useful to investors.

23

Condensed Consolidating Statement of Income Quarter ended August 1, 2014
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	520,247		$	564,148		$	(208,734	)	$	875,661
Cost of sales	—			378,457			414,784			(169,512		)	623,729
Product development, selling and administrative expenses	7,017			49,337			80,905			—			137,259
Other (income) expense	—			2,350			(6,968		)	—			(4,618		)
Operating income (loss)	(7,017		)	90,103			75,427			(39,222		)	119,291
Intercompany items	15,641			(14,897		)	(7,048		)	6,304			—
Interest (expense) income, net	(15,614		)	1,055			(338		)	—			(14,897		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(6,990		)	76,261			68,041			(32,918		)	104,394
Provision (benefit) for income taxes	(5,923		)	32,720			6,329			(21		)	33,105
Equity in income of subsidiaries	72,356			25,017			—			(97,373		)	—
Income from continuing operations	$	71,289		$	68,558		$	61,712		$	(130,270	)	$	71,289
Comprehensive income	$	81,683		$	68,652		$	81,173		$	(149,825	)	$	81,683

Condensed Consolidating Statement of Income Quarter ended July 26, 2013
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	705,240		$	1,010,312		$	(394,941	)	$	1,320,611
Cost of sales	—			486,694			719,287			(325,772		)	880,209
Product development, selling and administrative expenses	10,564			77,403			79,188			—			167,155
Other (income) expense	—			8,669			(9,761		)	—			(1,092		)
Operating income (loss)	(10,564		)	132,474			221,598			(69,169		)	274,339
Intercompany items	28,719			(23,009		)	(41,956		)	36,246			—
Interest (expense) income, net	(16,097		)	1,110			1,385			—			(13,602		)
Income from continuing operations before income taxes and equity in income of subsidiaries	2,058			110,575			181,027			(32,923		)	260,737
Provision (benefit) for income taxes	(16,484		)	66,875			27,159			—			77,550
Equity in income of subsidiaries	164,645			48,757			—			(213,402		)	—
Income from continuing operations	$	183,187		$	92,457		$	153,868		$	(246,325	)	$	183,187
Comprehensive income	$	139,804		$	93,316		$	107,556		$	(200,872	)	$	139,804

24

Condensed Consolidating Statement of Income Nine months ended August 1, 2014
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	1,495,659		$	1,803,084		$	(654,040	)	$	2,644,703
Cost of sales	—			1,108,173			1,308,371			(537,045		)	1,879,499
Product development, selling and administrative expenses	35,840			183,363			225,619			—			444,822
Other (income) expense	(473		)	8,890			(18,313		)	—			(9,896		)
Operating income (loss)	(35,367		)	195,233			287,407			(116,995		)	330,278
Intercompany items	48,422			(60,625		)	(19,053		)	31,256			—
Interest (expense) income, net	(47,495		)	4,595			335			—			(42,565		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(34,440		)	139,203			268,689			(85,739		)	287,713
Provision (benefit) for income taxes	(15,855		)	89,828			19,639			—			93,612
Equity in income of subsidiaries	212,686			105,984			—			(318,670		)	—
Income from continuing operations	$	194,101		$	155,359		$	249,050		$	(404,409	)	$	194,101
Comprehensive income	$	187,272		$	156,753		$	243,127		$	(399,880	)	$	187,272

Condensed Consolidating Statement of Income Nine months ended July 26, 2013
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	2,117,561		$	2,791,748		$	(1,078,386	)	$	3,830,923
Cost of sales	—			1,470,137			1,968,820			(876,420		)	2,562,537
Product development, selling and administrative expenses	39,974			230,862			226,553			—			497,389
Other (income) expense	—			24,575			(27,702		)	—			(3,127		)
Operating income (loss)	(39,974		)	391,987			624,077			(201,966		)	774,124
Intercompany items	86,728			(66,824		)	(104,489		)	84,585			—
Interest (expense) income, net	(49,022		)	1,654			3,428			—			(43,940		)
Income (loss) from continuing operations before income taxes and equity in income of subsidiaries	(2,268		)	326,817			523,016			(117,381		)	730,184
Provision (benefit) for income taxes	(37,121		)	191,529			68,671			—			223,079
Equity in income of subsidiaries	472,252			245,367			—			(717,619		)	—
Income from continuing operations	$	507,105		$	380,655		$	454,345		$	(835,000	)	$	507,105
Comprehensive income	$	455,140		$	377,904		$	390,504		$	(768,408	)	$	455,140

25

Condensed Consolidating Balance Sheet As of August 1, 2014
In thousands	Parent Company			Supplemental Subsidiary Guarantors		Supplemental Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	35,061		$	7,023	$	265,958	$	—		$	308,042
Accounts receivable, net	—			380,167		525,384		(14,713		)	890,838
Inventories	—			497,772		823,590		(109,627		)	1,211,735
Other current assets	65,908			7,391		114,001		15			187,315
Total current assets	100,969			892,353		1,728,933		(124,325		)	2,597,930
Property, plant and equipment, net	19,939			350,635		542,981		(2,817		)	910,738
Other assets:
Other intangible assets, net	—			233,878		90,666		—			324,544
Goodwill	—			453,375		1,063,595		—			1,516,970
Deferred income taxes	(23,013		)	—		67,903		—			44,890
Other non-current assets	4,188,375			1,974,666		2,696,273		(8,663,677		)	195,637
Total other assets	4,165,362			2,661,919		3,918,437		(8,663,677		)	2,082,041
Total assets	$	4,286,270		$	3,904,907	$	6,190,351	$	(8,790,819	)	$	5,590,709
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term notes payable, including current portion of long-term obligations	$	—		$	—	$	168	$	—		$	168
Trade accounts payable	1,294			188,251		167,326		—			356,871
Employee compensation and benefits	8,863			53,112		52,376		—			114,351
Advance payments and progress billings	—			126,478		289,283		(18,278		)	397,483
Accrued warranties	—			18,319		45,366		—			63,685
Other accrued liabilities	35,275			52,031		148,447		(6,635		)	229,118
Current liabilities of discontinued operations	—			11,581		—		—			11,581
Total current liabilities	45,432			449,772		702,966		(24,913		)	1,173,257
Long-term obligations	1,269,258			—		69		—			1,269,327
Other liabilities:
Liabilities for postretirement benefits	18,827			860		—		—			19,687
Accrued pension costs	152,146			5,207		7,096		—			164,449
Other non-current liabilities	(9,379		)	7,872		155,510		—			154,003
Total other liabilities	161,594			13,939		162,606		—			338,139
Shareholders’ equity	2,809,986			3,441,196		5,324,710		(8,765,906		)	2,809,986
Total liabilities and shareholders’ equity	$	4,286,270		$	3,904,907	$	6,190,351	$	(8,790,819	)	$	5,590,709

26

Condensed Consolidating Balance Sheet As of October 25, 2013
In thousands	Parent Company			Supplemental Subsidiary Guarantors		Supplemental Non-Guarantor Subsidiaries		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	122,901		$	20,361	$	262,447	$	—		$	405,709
Accounts receivable, net	—			402,321		687,790		(6,448		)	1,083,663
Inventories	—			456,345		813,182		(129,783		)	1,139,744
Other current assets	68,792			16,957		107,564		15			193,328
Total current assets	191,693			895,984		1,870,983		(136,216		)	2,822,444
Property, plant and equipment, net	18,081			373,235		521,326		—			912,642
Other assets:
Other intangible assets, net	—			247,200		84,612		—			331,812
Goodwill	—			454,199		1,026,320		—			1,480,519
Deferred income taxes	(49,393		)	—		90,925		—			41,532
Other non-current assets	4,168,916			2,070,239		3,963,205		(10,001,727		)	200,633
Total other assets	4,119,523			2,771,638		5,165,062		(10,001,727		)	2,054,496
Total assets	$	4,329,297		$	4,040,857	$	7,557,371	$	(10,137,943	)	$	5,789,582
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term notes payable, including current portion of long-term obligations	$	50,000		$	449	$	8,220	$	—		$	58,669
Trade accounts payable	2,565			165,045		220,509		—			388,119
Employee compensation and benefits	10,080			52,260		68,215		—			130,555
Advance payments and progress billings	—			144,853		269,628		(14,713		)	399,768
Accrued warranties	—			30,111		55,621		—			85,732
Other accrued liabilities	24,545			54,285		211,074		(3,841		)	286,063
Current liabilities of discontinued operations	—			11,684		—		—			11,684
Total current liabilities	87,190			458,687		833,267		(18,554		)	1,360,590
Long-term obligations	1,256,164			763		—		—			1,256,927
Other liabilities:
Liabilities for postretirement benefits	19,881			842		—		—			20,723
Accrued pension costs	136,886			5,685		7,234		—			149,805
Other non-current liabilities	(29,193		)	7,851		164,510		—			143,168
Total other liabilities	127,574			14,378		171,744		—			313,696
Shareholders’ equity	2,858,369			3,567,029		6,552,360		(10,119,389		)	2,858,369
Total liabilities and shareholders’ equity	$	4,329,297		$	4,040,857	$	7,557,371	$	(10,137,943	)	$	5,789,582

27

Condensed Consolidating Statement of Cash Flows Nine months ended August 1, 2014
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Consolidated
Operating Activities:
Net cash provided (used) by operating activities of continuing operations	$	194,291		$	(4,062	)	$	108,092		$	298,321
Net cash used by operating activities of discontinued operations	—			(103		)	—			(103		)
Net cash provided (used) by operating activities	194,291			(4,165		)	108,092			298,218
Investing Activities:
Acquisition of Mining Technologies International Inc.	—			—			(47,058		)	(47,058		)
Property, plant and equipment acquired	(3,969		)	(15,317		)	(49,782		)	(69,068		)
Proceeds from sale of property, plant and equipment	—			7,124			1,758			8,882
Other investing activities, net	(82		)	232			(239		)	(89		)
Net cash used by investing activities	(4,051		)	(7,961		)	(95,321		)	(107,333		)
Financing Activities:
Common stock issued	10,189			—			—			10,189
Excess tax benefit from share-based compensation awards	1,727			—			—			1,727
Dividends paid	(55,334		)	—			—			(55,334		)
Repayments of term loan	(37,500		)	—			—			(37,500		)
Changes in short and long-term obligations, net	—			(1,212		)	(8,008		)	(9,220		)
Treasury stock purchased	(194,336		)	—			—			(194,336		)
Financing fees	(2,826		)	—			—			(2,826		)
Net cash used by financing activities	(278,080		)	(1,212		)	(8,008		)	(287,300		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			—			(1,252		)	(1,252		)
(Decrease) Increase in Cash and Cash Equivalents	(87,840		)	(13,338		)	3,511			(97,667		)
Cash and Cash Equivalents at Beginning of Period	122,901			20,361			262,447			405,709
Cash and Cash Equivalents at End of Period	$	35,061		$	7,023		$	265,958		$	308,042

28

Condensed Consolidating Statement of Cash Flows Nine months ended July 26, 2013
In thousands	Parent Company			Supplemental Subsidiary Guarantors			Supplemental Non-Guarantor Subsidiaries			Consolidated
Operating Activities:
Net cash provided by operating activities of continuing operations	$	277,846		$	52,139		$	113,155		$	443,140
Net cash used by operating activities of discontinued operations	—			(1,567		)	—			(1,567		)
Net cash provided by operating activities	277,846			50,572			113,155			441,573
Investing Activities:
Property, plant and equipment acquired	(5,810		)	(29,312		)	(82,787		)	(117,909		)
Proceeds from sale of property, plant and equipment	—			1,272			1,667			2,939
Other investing activities, net	(98		)	—			—			(98		)
Net cash used by investing activities	(5,908		)	(28,040		)	(81,120		)	(115,068		)
Financing Activities:
Common stock issued	5,461			—			—			5,461
Excess tax benefit from share-based compensation awards	1,672			—			—			1,672
Dividends paid	(55,726		)	—			—			(55,726		)
Repayments of term loan	(37,500		)	—			—			(37,500		)
Changes in short and long-term obligations, net	—			(316		)	(5,343		)	(5,659		)
Net cash used by financing activities	(86,093		)	(316		)	(5,343		)	(91,752		)
Effect of Exchange Rate Changes on Cash and Cash Equivalents	—			—			(12,576		)	(12,576		)
Increase in Cash and Cash Equivalents	185,845			22,216			14,116			222,177
Cash and Cash Equivalents at Beginning of Period	3,459			6,628			253,786			263,873
Cash and Cash Equivalents at End of Period	$	189,304		$	28,844		$	267,902		$	486,050

19. Subsequent Events

On August 19, 2014, our Board of Directors declared a cash dividend of $0.20 per outstanding share of common stock. The dividend will be paid on September 18, 2014 to all shareholders of record at the close of business on September 4, 2014.

29

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 Item 1 of this Quarterly Report on Form 10-Q. Dollar amounts are in thousands, except per share data and as otherwise indicated.

Overview

Joy Global Inc. is a leading manufacturer and servicer of high-productivity mining equipment for the extraction of coal and other minerals and ores. We manufacture and market original equipment and parts and perform services for both underground and surface mining, as well as certain industrial applications. Our equipment is used in major mining regions throughout the world to mine coal, copper, iron ore, oil sands, gold and other minerals. We operate in two business segments: Underground and Surface. We are a major manufacturer of underground mining machinery for the extraction of coal and other bedded minerals and offer comprehensive service locations near major mining regions worldwide. We are also a major producer of surface mining equipment for the extraction of coal and other minerals and ores and provide extensive operational support for many types of equipment used in surface mining. Our principal manufacturing facilities are located in the United States, including facilities in Alabama, Pennsylvania, Texas and Wisconsin, and internationally, including facilities in Australia, Canada, China, South Africa and the United Kingdom.

Operating Results

Quarter Ended August 1, 2014 Compared With Quarter Ended July 26, 2013

Net sales in the third quarter of fiscal 2014 were $875.7 million, compared to $1.3 billion in the third quarter of fiscal 2013. The decrease in net sales of $445.0 million, or 33.7%, in the current year third quarter reflected a decrease in original equipment sales of $344.2 million, or 57.3%, and a decrease in service sales of $100.8 million, or 14.0%. Both original equipment and service sales decreased in all regions. The decrease in original equipment sales was led by North America and Australia, which decreased by $122.6 million and $81.0 million, respectively. The decrease in service sales was led by Australia and China, which decreased by $31.1 million and $27.4 million, respectively. Compared to the prior year third quarter, net sales in the third quarter of fiscal 2014 included a $9.5 millionunfavorable effect of foreign currency translation.

Operating income in the third quarter of fiscal 2014 was $119.3 million, or 13.6% of net sales, compared to $274.3 million, or 20.8% of net sales, in the third quarter of fiscal 2013. The decrease in operating income of $155.0 million, or 56.5%, in the current year third quarter was due to lower volumes sold of $158.6 million, a less favorable product mix of $3.1 million, lower manufacturing cost absorption of $17.8 million and higher period costs of $8.9 million, which includes a $7.8 million non-cash pension curtailment charge resulting from actions taken in the quarter to freeze certain of our U.S. bargaining units defined benefit plans at the end of the calendar year. These items were partially offset by an increase in other income of $3.5 million and reduced product development, selling and administrative expenses of $29.9 million, inclusive of a $3.1 million increase in restructuring charges. Restructuring activities continued in the quarter to optimize the company's manufacturing footprint and to better align its overall cost structure with anticipated demand. Compared to the prior year third quarter, operating income in the third quarter of fiscal 2014 included a $1.3 million unfavorable effect of foreign currency translation.

Income from continuing operations was $71.3 million, or $0.71 per diluted share, in the third quarter of fiscal 2014, compared to $183.2 million, or $1.71 per diluted share, in the third quarter of fiscal 2013.

Bookings in the third quarter of fiscal 2014 were $923.4 million, compared to $695.4 million in the third quarter of fiscal 2013. The increase in bookings of $228.0 million, or 32.8%, in the current year third quarter reflected an increase in original equipment bookings of $188.1 million, or 195.3%, and an increase in service orders of $39.9 million, or 6.7%. Original equipment bookings increased in all regions except Eurasia. The increase in original equipment bookings was led by South America and Australia, which increased by $79.4 million and $64.1 million, respectively. Service bookings also increased in all regions except Eurasia. The increase in service bookings was led by China and South America, which increased by $16.6 million and $12.2 million, respectively. Compared to the prior year third quarter, bookings in the third quarter of fiscal 2014 included a $13.2 millionunfavorable effect of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the South African rand.

Nine Months Ended August 1, 2014 Compared With Nine Months Ended July 26, 2013

Net sales in the first nine months of fiscal 2014 were $2.6 billion, compared to $3.8 billion in the first nine months of fiscal 2013. The decrease in net sales of $1.2 billion, or 31.0%, in the first nine months of the current year reflected a decrease in original equipment sales of $972.4 million, or 55.0%, and a decrease in service sales of $213.8 million, or 10.4%. Original equipment sales

30

decreased in all regions. The decrease in original equipment sales was led by North America and Australia, which decreased by $291.5 million and $261.1 million, respectively. Service sales decreased in all regions except Africa. The decrease in service sales was led by China and Australia, which decreased by $101.1 million and $75.6 million, respectively. Compared to the first nine months of the prior year, net sales in the first nine months of fiscal 2014 included a $78.1 million unfavorable effect of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the Australian dollar and South African rand.

Operating income in the first nine months of fiscal 2014 was $330.3 million, or 12.5% of net sales, compared to $774.1 million, or 20.2% of net sales, in the first nine months of fiscal 2013. The decrease in operating income of $443.8 million, or 57.3%, in the first nine months of the current year was due to lower volumes sold of $408.7 million, a less favorable product mix of $21.8 million, lower manufacturing cost absorption of $47.7 million and higher period costs of $25.0 million, which included a $7.8 million non-cash curtailment charge in the current period and a $3.8 million gain from the true-up of first year excess purchase accounting charges in fiscal 2013. These items were partially offset by an increase in other income of $6.8 million and reduced product development, selling and administrative expenses of $52.6 million, inclusive of a $3.3 million increase in restructuring charges. Compared to the first nine months of the prior year, operating income in the first nine months of fiscal 2014 included a $14.5 million unfavorable effect of foreign currency translation. Restructuring activities continued during the year to optimize the company's manufacturing footprint and to better align its overall cost structure with anticipated demand.

Income from continuing operations was $194.1 million, or $1.91 per diluted share, in the first nine months of fiscal 2014, compared to $507.1 million, or $4.73 per diluted share, in the first nine months of fiscal 2013.

Bookings in the first nine months of fiscal 2014 were $2.8 billion, compared to $2.8 billion in the first nine months of fiscal 2013. The slight decrease in bookings of $17.4 million, or 0.6%, in the first nine months of the current year reflected a decrease in original equipment bookings of $128.2 million, or 12.6%, and an increase in service orders of $110.8 million, or 6.0%. Original equipment bookings decreased in all regions except South America. The decrease in original equipment orders was led by North America and China, which decreased by $88.5 million and $52.8 million, respectively. The decline is largely due to longwall system orders received in the prior year, partially offset by current year bookings of the first low seam longwall system and a multiple shovel order for a greenfield expansion project in the Canadian oil sands with deliveries in 2016. Service bookings increased in all regions except Africa and Australia. The increase in service bookings was led by North America and South America, which increased by $61.9 million and $40.0 million, respectively. Compared to the first nine months of the prior year, bookings in the first nine months of fiscal 2014 included a $76.4 million unfavorable effect of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the Australian dollar and South African rand.

Market Outlook

While global economic activity accelerated during the second calendar quarter to its strongest level in nearly three years, geographic and geopolitical issues continued to weigh on the growth profile for 2014. Eurozone growth has improved, but is inconsistent across the region and faces headwinds from weak inflation and the ongoing events in the Ukraine. Chinese growth, while improving during the second quarter, remains largely dependent on stimulus efforts and faces challenges in the housing market. Despite headwinds, global growth is set to improve in 2015 and should drive increased demand for commodities.

The U.S. thermal coal market continues to face challenging conditions despite economic growth in the U.S. during the second quarter. Power plant coal inventories have risen in recent weeks with seasonal restocking activity, but levels still remain well below historical averages. However, U.S. coal production is still lagging behind last year as depressed prices, cooler than normal summer weather, and decreased export activity have weighed on overall demand. Sustained natural gas prices have driven an increase in coal burn this year.

Seaborne thermal coal supply growth outpaced demand during the first half of the year and resulted in further price declines. Warm winter weather in Europe along with elevated global coal inventories compounded an already oversupplied seaborne market and have driven prices down. Strong import demand from China and India has been offset by export growth from Australia and Indonesian production growth during the first half of the year. Oversupply conditions are likely to persist through at least mid-2015. The estimated surplus in the market will continue to drive mine closures, supply rationalization and pricing pressure.

China’s domestic coal market continues to face challenges with first half production falling and prices down year-to-date. Chinese authorities are preparing policies to implement production cuts to help support the domestic market. These cuts are expected to take place during the second half of the year and are aimed at supporting domestic prices given that the majority of producers are currently operating at a loss.

Seaborne metallurgical coal markets remain weak. However, this was the first time in the last year in which there wasn’t a sequential price decline. While metallurgical coal curtailments have been announced, additional cuts are likely needed before any meaningful price appreciation can be expected.

31

Metallurgical coal markets have been supported by the increase in global steel production during the first half of 2014. Full-year growth is still expected and will continue to drive seaborne demand for iron ore and metallurgical coal. While demand for iron ore has remained strong, growth in seaborne iron ore supply has outpaced demand and pushed iron ore prices to three year lows during June. Iron ore prices are down year-to-date, and will remain under pressure through 2015 at which point major supply increases will start to slow.

Global copper markets remain relatively strong, driven by an unexpected deficit through the first half of the year. The deficit is likely the result of stronger than expected demand, along with several notable supply disruptions. Output is expected to remain strong through year-end and should work to bring the market closer to the surplus that was forecast at the beginning of the year. The strengthening U.S. economy and recovering European construction sector have created increased copper demand while global inventories are below their March 2013 peak. These conditions helped to drive prices higher during July.

While commodity supply rationalization continues, there is inconsistency across various markets and the process is still in the early to mid-stages. Despite improving global economic conditions that should drive demand, market dynamics are such that prices for most major commodities remain depressed with marginal upside potential over the near-term. Investments in mining capacity over the last several years will be maximized, leveraged up, or shut down as miners' capital expenditures will be focused on products and services that improve mine productivity and lower costs.

Company Outlook

Despite the depressed commodity pricing environment and oversupplied markets, our performance remains solid and we continue to see stability in our core service business. During the quarter, service bookings were up from last year, marking the third consecutive quarter of growth. Service bookings growth tied to our global shovel fleet was driven by strength in global copper markets. Additionally, we saw some improvement in our service business related to U.S. coal market rebuilds as the ability of some of our customers to continue to delay maintenance appears to be reaching an end.

Another area where we see opportunities is in the iron ore market. Although prices have declined since the beginning of the year, the steep global cost curve continues to provide service opportunities for our installed base with lower-cost producers. Iron ore demand, driven by strength in global steel markets, resulted in the booking of two shovels in China during the quarter. Quote log activity with other major iron ore producers remains active and we expect additional sales to materialize in coming quarters.

We continue to see some progress in our efforts to develop the domestic Chinese coal market with our full range of products and systems approach. Market conditions that have resulted in coal prices declining and domestic production trailing last year have driven an increasing need for mechanization of mines and new technologies and products. These challenging market conditions have provided an opportunity to work with our customers to customize solutions that shift their costs curves lower and return them to profitability. We will continue to invest in our technology and leverage our China footprint as the expected consolidation brought on by market conditions continues to play out.

We remain optimistic about the long-term growth prospects in coal and other mined minerals in Eastern Europe and Russia. We continue to invest in the construction of our new service center in Russia, with the opening planned later this year. The new Russian facility will bring superior surface and underground repair and rebuild capabilities to the Novokuznetsk region, along with local smart services technologies. Despite our commitment, we have seen near-term slowing of activity in the region as a result of the continued depressed pricing of seaborne coal markets and the current geopolitical environment.

While market conditions remain tough, we are seeing signs that the trough in the market has been set. During the quarter, rolling twelve month bookings increased sequentially for the first time since the first quarter of 2012. Strengthening economic growth should drive demand, but this will be tempered with supply rationalization in certain markets and result in a slower growth profile looking forward.

We are pleased with the integration progress at our recently acquired MTI hard rock business. One of our core strategies for growth is penetration into the underground hard rock mining landscape, and we are encouraged about leveraging MTI's product capabilities across our global sales and direct service network and further development of our transformational continuous mechanical cutting technology to accomplish this strategic objective. The combination of MTI and our technology development represent a significant long-term growth opportunity for the company.

In addition, we will continue to use our solid cash generation capabilities to further optimize our global manufacturing and service infrastructure. At the same time, we remain committed to our share repurchase program and have completed over 40 percent of our $1 billion authorization in the first year.

32

Results of Operations

Quarter Ended August 1, 2014 Compared With Quarter Ended July 26, 2013

Net Sales

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

	Quarter Ended
In thousands	August 1, 2014			July 26, 2013			$ Change			% Change
Net Sales
Underground	$	470,747		$	722,748		$	(252,001	)	(34.9	)
Surface	435,186			640,919			(205,733		)	(32.1	)
Eliminations	(30,272		)	(43,056		)	12,784
Total Sales	$	875,661		$	1,320,611		$	(444,950	)	(33.7	)

Underground net sales in the third quarter of fiscal 2014 were $470.7 million, compared to $722.7 million in the third quarter of fiscal 2013. The decrease in Underground net sales of $252.0 million, or 34.9%, in the current year third quarter reflected a decrease in original equipment sales of $213.8 million, or 59.4%, and a decrease in service sales of $38.2 million, or 10.5%. Original equipment sales decreased in all regions. The decrease in original equipment sales was led by North America and Australia, which decreased by $56.9 million and $62.7 million, respectively. Service sales decreased in all regions except North America. The decrease in service sales was led by Australia and China, which decreased by $23.6 million and $20.6 million, respectively. Compared to the prior year third quarter, net sales in the third quarter of fiscal 2014 included a $5.1 millionunfavorable effect of foreign currency translation.

Surface net sales in the third quarter of fiscal 2014 were $435.2 million, compared to $640.9 million in the third quarter of fiscal 2013. The decrease in Surface net sales of $205.7 million, or 32.1%, in the current year third quarter reflected a decrease in original equipment sales of $140.1 million, or 53.7%, and a decrease in service sales of $65.6 million, or 17.3%. Original equipment sales decreased in all regions except Eurasia which was flat. The decrease in original equipment sales was led by North America and South America, which decreased by $65.5 million and $47.6 million, respectively. Service sales decreased in all regions. The decrease in service sales was led by North America and Eurasia, which decreased by $33.6 million and $10.0 million, respectively. Compared to the prior year third quarter, net sales in the third quarter of fiscal 2014 included a $4.4 millionunfavorable effect of foreign currency translation.

Operating Income

The following table sets forth the operating income included in our Condensed Consolidated Statements of Income.

	Quarter Ended
	August 1, 2014				July 26, 2013
	Operating				Operating
In thousands	Income			% of Net Sales	Income			% of Net Sales
Operating Income
Underground	$	47,635		10.1	$	138,225		19.1
Surface	87,269			20.1	157,353			24.6
Corporate Expense	(7,039		)		(10,601		)
Eliminations	(8,574		)		(10,638		)
Total Operating Income	$	119,291		13.6	$	274,339		20.8

Underground operating income in the third quarter of fiscal 2014 was $47.6 million, or 10.1% of net sales, compared to $138.2 million, or 19.1% of net sales, in the third quarter of fiscal 2013. The decrease in Underground operating income of $90.6 million, or 65.5%, in the current year third quarter was due to lower volumes sold of $86.8 million, lower manufacturing cost absorption of $23.6 million and higher period costs of $1.8 million, which includes a $7.8 million non-cash pension curtailment charge in the current period. These items were partially offset by a more favorable product mix of $3.0 million, an increase in other income of $0.4 million and reduced product development, selling and administrative expenses of $18.2 million, inclusive of a $3.3 million increase in restructuring charges. Compared to the prior year third quarter, Underground operating income in the third quarter of fiscal 2014 included a $1.4 millionunfavorable effect of foreign currency translation.

33

Surface operating income in the third quarter of fiscal 2014 was $87.3 million, or 20.1% of net sales, compared to $157.4 million, or 24.6% of net sales, in the third quarter of fiscal 2013. The decrease in Surface operating income of $70.1 million, or 44.5%, in the current year third quarter was due to lower volumes sold of $74.0 million, a less favorable product mix of $6.0 million and higher period costs of $7.2 million. These items were partially offset by higher manufacturing cost absorption of $5.9 million, an increase in other income of $3.1 million and reduced product development, selling and administrative expenses of $8.1 million, which included a $0.2 million decrease in restructuring charges. Compared to the prior year third quarter, Surface operating income in the third quarter of fiscal 2014 included a $0.1 million favorable impact of foreign currency translation.

Corporate expense in the third quarter of fiscal 2014 was $7.0 million, compared to $10.6 million in the third quarter of fiscal 2013. The decrease in corporate expense of $3.6 million, or 33.6%, is primarily due to lower incentive based compensation expense.

Product Development, Selling and Administrative Expense

Product development, selling and administrative expense in the third quarter of fiscal 2014 was $137.3 million, or 15.7% of net sales, compared to $167.2 million, or 12.7% of net sales, in the third quarter of fiscal 2013. The decrease in product development, selling and administrative expense of $29.9 million, or 17.9%, was due primarily to lower incentive based compensation expense, reduced defined benefit employee pension plan costs and cost reduction initiatives.

Net Interest Expense

Net interest expense in the third quarter of fiscal 2014 was $14.9 million, compared to $13.6 million in the third quarter of fiscal 2013. The increase in net interest expense of $1.3 million, or 9.5%, was primarily due to the current period write-off of certain unamortized costs in conjunction with the refinancing of our Term Loan and Credit Agreement and decreased interest income on lower balances of interest bearing assets, partially offset by a lower balance on our Term Loan.

Provision for Income Taxes

The provision for income taxes in the third quarter of fiscal 2014 was $33.1 million, compared to $77.6 million in the third quarter of fiscal 2013. The effective income tax rate was 31.7% in the third quarter of fiscal 2014, compared to 29.7% in the third quarter of fiscal 2013. The effective income tax rate excluding discrete tax adjustments was 32.1% for the quarter, compared to 31.1% in the third quarter of fiscal 2013. The increase in the effective tax rate for the quarter was primarily attributable to a change in geographical mix of projected earnings and a change in the net operating losses of certain foreign subsidiaries without a currently recognizable tax benefit.

Bookings

Bookings represent new customer orders for original equipment and services, exclusive of long-term maintenance and repair arrangements and life cycle management arrangements awarded to us during the reporting period. Customer orders represent arrangements to purchase specific original equipment or services by customers who have satisfied our credit review procedures. We record bookings when firm orders are received and add the bookings to our backlog. Bookings for the quarters ended August 1, 2014 and July 26, 2013 are as follows:

	Quarter Ended
In thousands	August 1, 2014			July 26, 2013			$ Change			% Change
Bookings
Underground	$	493,115		$	361,159		$	131,956		36.5
Surface	482,609			354,948			127,661			36.0
Eliminations	(52,307		)	(20,704		)	(31,603		)
Total Bookings	$	923,417		$	695,403		$	228,014		32.8

Underground bookings in the third quarter of fiscal 2014 were $493.1 million, compared to $361.2 million in the third quarter of fiscal 2013. The increase in Underground bookings of $132.0 million, or 36.5%, in the current year third quarter reflected an increase in original equipment bookings of $99.7 million, or 130.4%, and an increase in service orders of $32.2 million, or 11.3%. Original equipment orders increased in all regions except Eurasia and China. The increase in original equipment orders was led by Australia and North America, which increased by $55.2 million and $42.7 million, respectively. The increase in original equipment bookings in Australia was primarily due to increased conveyor bookings and the favorable impact of foreign currency translation on backlog denominated in Australian dollars. Service orders increased in all regions except Australia. The increase in service orders was led by China, which increased by $18.1 million. The overall increase in service orders was led by stronger

34

rebuild activity in all regions. Compared to the prior year third quarter, Underground bookings in the third quarter of fiscal 2014 included a $9.5 millionunfavorable impact of foreign currency translation.

Surface bookings in the third quarter of fiscal 2014 were $482.6 million, compared to $354.9 million in the third quarter of fiscal 2013. The increase in Surface bookings of $127.7 million, or 36.0%, in the current year third quarter reflected an increase in original equipment bookings of $117.2 million, or 550.6%, and an increase in service orders of $10.5 million, or 3.1%. Original equipment orders increased in all regions except North America and Africa. The increase in original equipment orders was led by South America and Australia, which increased by $79.4 million and $33.2 million, respectively. The increase in service orders was also led by South America and Australia, which increased by $12.2 million and $11.0 million, respectively, with declines in Eurasia, Africa and China. Compared to the prior year third quarter, Surface bookings in the third quarter of fiscal 2014 included a $3.7 millionunfavorable impact of foreign currency translation.

Nine Months Ended August 1, 2014 Compared With Nine Months Ended July 26, 2013

Net Sales

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

	Nine Months Ended
In thousands	August 1, 2014			July 26, 2013			$ Change			% Change
Net Sales
Underground	$	1,466,088		$	1,994,772		$	(528,684	)	(26.5	)
Surface	1,279,507			1,959,198			(679,691		)	(34.7	)
Eliminations	(100,892		)	(123,047		)	22,155
Total Sales	$	2,644,703		$	3,830,923		$	(1,186,220	)	(31.0	)

Underground net sales in the first nine months of fiscal 2014 were $1.5 billion, compared to $2.0 billion in the first nine months of fiscal 2013. The decrease in Underground net sales of $528.7 million, or 26.5%, in the first nine months of the current year reflected a decrease in original equipment sales of $446.8 million, or 47.6%, and a decrease in service sales of $81.9 million, or 7.8%. Original equipment sales decreased in all regions. The decrease in original equipment sales was led by Australia and North America, which decreased by $166.7 million and $136.5 million, respectively. The decrease in service sales was led by China and Australia, which decreased by $91.4 million and $34.2 million, respectively, with increases in all other regions. Compared to the first nine months of the prior year, net sales in the first nine months of fiscal 2014 included a $53.9 million unfavorable effect of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the Australian dollar and South African rand.

Surface net sales in the first nine months of fiscal 2014 were $1.3 billion, compared to $2.0 billion in the first nine months of fiscal 2013. The decrease in Surface net sales of $679.7 million, or 34.7%, in the first nine months of the current year reflected a decrease in original equipment sales of $545.7 million, or 61.5%, and a decrease in service sales of $134.0 million, or 12.5%. Both original equipment and service sales decreased in all regions. The decrease in original equipment sales was led by South America and North America, which decreased by $188.8 million and $160.2 million, respectively. The decrease in service sales was led by North America and Australia, which decreased by $60.1 million and $37.8 million, respectively. Compared to the first nine months of the prior year, net sales in the first nine months of fiscal 2014 included a $24.2 million unfavorable effect of foreign currency translation.

Operating Income

The following table sets forth the operating income included in our Condensed Consolidated Statements of Income.

35

	Nine Months Ended
	August 1, 2014				July 26, 2013
	Operating				Operating
In thousands	Income			% of Net Sales	Income			% of Net Sales
Operating Income
Underground	$	177,773		12.1	$	387,330		19.4
Surface	216,034			16.9	458,676			23.4
Corporate Expense	(35,464		)		(40,080		)
Eliminations	(28,065		)		(31,802		)
Total Operating Income	$	330,278		12.5	$	774,124		20.2

Underground operating income in the first nine months of fiscal 2014 was $177.8 million, or 12.1% of net sales, compared to $387.3 million, or 19.4% of net sales, in the first nine months of fiscal 2013. The decrease in Underground operating income of $209.5 million, or 54.1%, in the first nine months of the current year was due to lower volumes sold of $183.9 million, a less favorable product mix of $9.4 million, lower manufacturing cost absorption of $47.0 million and higher period costs of $12.3 million, which included a $7.8 million non-cash curtailment loss in the current period and a $3.8 million gain from the true-up of first year excess purchase accounting charges in fiscal 2013. These items were partially offset by an increase in other income of $2.4 million and reduced product development, selling and administrative expenses of $40.7 million, inclusive of a $1.1 million increase in restructuring charges. Compared to the first nine months of the prior year, Underground operating income in the first nine months of fiscal 2014 included a $13.7 million unfavorable effect of foreign currency translation.

Surface operating income in the first nine months of fiscal 2014 was $216.0 million, or 16.9% of net sales, compared to $458.7 million, or 23.4% of net sales, in the first nine months of fiscal 2013. The decrease in Surface operating income of $242.7 million, or 52.9%, in the first nine months of the current year was due to lower volumes sold of $229.6 million, a less favorable product mix of $11.3 million, lower manufacturing cost absorption of $0.8 million and higher period costs of $12.6 million. These items were partially offset by an increase in other income of $3.9 million and lower product development, selling and administrative expenses of $7.7 million, inclusive of a $1.3 million increase in restructuring charges. Compared to the first nine months of the prior year, Surface operating income in the first nine months of fiscal 2014 included a $0.8 million unfavorable impact of foreign currency translation.

Corporate expense in the first nine months of fiscal 2014 was $35.5 million, compared to $40.1 million in the first nine months of fiscal 2013. The decrease in corporate expense of $4.6 million, or 11.5%, is primarily due to higher other income of $0.5 million and lower administrative expenses of $4.1 million primarily due to lower incentive based compensation expense, inclusive of a $0.9 million increase in restructuring charges.

Product Development, Selling and Administrative Expense

Product development, selling and administrative expense in the first nine months of fiscal 2014 was $444.8 million, or 16.8% of net sales, compared to $497.4 million, or 13.0% of net sales, in the first nine months of fiscal 2013. The decrease in product development, selling and administrative expense of $52.6 million, or 10.6%, was due primarily to lower incentive based compensation expense, reduced defined benefit employee pension plan costs and cost reduction initiatives, partially offset by higher bad debt expense.

Net Interest Expense

Net interest expense in the first nine months of fiscal 2014 was $42.6 million, compared to $43.9 million in the first nine months of fiscal 2013. The decrease in net interest expense of $1.3 million, or 3.1%, was primarily due to a lower balance on our Term Loan and increased interest income on higher balances of interest bearing assets.

Provision for Income Taxes

The provision for income taxes in the first nine months of fiscal 2014 was $93.6 million, compared to $223.1 million in the first nine months of fiscal 2013. The effective income tax rate was 32.5% in the first nine months of fiscal 2014, compared to 30.6% in the first nine months of fiscal 2013. The effective income tax rate excluding discrete tax adjustments was 33.0% in the first nine months of fiscal 2014, compared to 31.0% in the first nine months of fiscal 2013. The increase in the effective tax rate for the first nine months of fiscal 2014 was primarily attributable to a change in geographical mix of projected earnings and a change in the net operating losses of certain foreign subsidiaries without a currently recognizable tax benefit.

Bookings and Backlog

36

Bookings for the nine months ended August 1, 2014 and July 26, 2013 are as follows:

	Nine Months Ended
In thousands	August 1, 2014			July 26, 2013			$ Change			% Change
Bookings
Underground	$	1,432,218		$	1,671,586		$	(239,368	)	(14.3	)
Surface	1,516,519			1,304,773			211,746			16.2
Eliminations	(117,212		)	(127,460		)	10,248
Total Bookings	$	2,831,525		$	2,848,899		$	(17,374	)	(0.6	)

Underground bookings in the first nine months of fiscal 2014 were $1.4 billion, compared to $1.7 billion in the first nine months of fiscal 2013. The decrease in Underground bookings of $239.4 million, or 14.3%, in the first nine months of the current year reflected a decrease in original equipment bookings of $283.0 million, or 37.4%, and an increase in service orders of $43.6 million, or 4.8%. Original equipment orders decreased in all regions except Eurasia. The decrease in original equipment orders was led by North America and China, which decreased by $144.2 million and $75.0 million, respectively. The decreases in North America and China were due in part to longwall system orders received in the prior year, while the increase in Eurasia was due in part to the first low seam longwall system being booked during the current year. Service orders increased in all regions except Australia. The increase in service orders was led by China and Eurasia, which increased by $18.7 million and $15.4 million, respectively. Compared to the first nine months of the prior year, Underground bookings in the first nine months of fiscal 2014 included a $49.1 million unfavorable impact of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the Australian dollar and South African rand.

Surface bookings in the first nine months of fiscal 2014 were $1.5 billion, compared to $1.3 billion in the first nine months of fiscal 2013. The increase in Surface bookings of $211.7 million, or 16.2%, in the first nine months of the current year reflected an increase in original equipment bookings of $142.0 million, or 44.1%, and an increase in service orders of $69.8 million, or 7.1%. Original equipment orders increased in all regions except Eurasia and Africa. The increase in original equipment orders was led by South America and North America, which increased by $99.0 million and $54.7 million, respectively. The increase is largely due to a multiple shovel order for a greenfield expansion project in the Canadian oil sands with deliveries in 2016. The increase in service orders was led by North America and South America, which increased by $47.0 million and $40.0 million, respectively, with declines in Africa, China and Eurasia. Compared to the first nine months of the prior year, Surface bookings in the first nine months of fiscal 2014 included a $27.3 million unfavorable impact of foreign currency translation, due primarily to the weakening of the U.S. dollar compared to the Australian dollar.

Backlog represents unfilled customer orders for our original equipment and services, exclusive of long-term maintenance and repair arrangements and life cycle management arrangements. The backlog amounts also exclude sales already recognized by period end under the percentage-of-completion method of accounting. Customer orders included in backlog represent contracts to purchase specific original equipment or services by customers who have satisfied our credit review procedures. The following table provides backlog as of August 1, 2014 and October 25, 2013:

In thousands	August 1, 2014			October 25, 2013
Backlog
Underground	$	938,205		$	951,227
Surface	791,983			554,971
Eliminations	(45,687		)	(29,367		)
Total Backlog	$	1,684,501		$	1,476,831

The decrease in backlog for Underground was driven by continued softness in coal markets, resulting in a book to bill ratio of less than one. The increase in backlog for Surface was driven by orders for equipment into oil sands, iron ore and copper mines, resulting in a book to bill ratio of greater than one.

Critical Accounting Estimates, Assumptions and Policies

37

Our discussion and analysis of financial condition and results of operations is based on our Condensed Consolidated Financial Statements, which have been prepared in accordance with GAAP. The preparation of these Condensed Consolidated Financial Statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingent assets and liabilities. We continually evaluate our estimates and judgments, including those related to bad debts, inventory, goodwill and intangible assets, warranty, pension and postretirement benefits and costs, 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, goodwill and other 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 25, 2013 for a discussion of these policies. There were no material changes to these policies since our year ended October 25, 2013.

Liquidity and Capital Resources

The following table summarizes the major elements of our working capital as of August 1, 2014 and October 25, 2013:

38

In thousands	August 1, 2014			October 25, 2013
Accounts receivable, net	$	890,838		$	1,083,663
Inventories	1,211,735			1,139,744
Trade accounts payable	(356,871		)	(388,119		)
Advance payments and progress billings	(397,483		)	(399,768		)
Trade Working Capital	$	1,348,219		$	1,435,520
Other current assets	187,315			193,328
Short-term notes payable, including current portion of long-term obligations	(168		)	(58,669		)
Employee compensation and benefits	(114,351		)	(130,555		)
Accrued warranties	(63,685		)	(85,732		)
Other accrued liabilities	(229,118		)	(286,063		)
Working Capital Excluding Cash and Cash Equivalents	$	1,128,212		$	1,067,829
Cash and cash equivalents	308,042			405,709
Working Capital	$	1,436,254		$	1,473,538

We currently use trade working capital and cash flows from continuing operations as two financial measurements to evaluate the performance of our operations and our ability to meet our financial obligations. We require trade working capital investment because our direct service model requires us to maintain certain inventory levels in order to maximize our customers’ machine availability. This information also provides management with a focus on our receivable terms and collectability efforts and our ability to obtain advance payments on original equipment orders. As part of the continuous improvement of our purchasing and manufacturing processes, we continue to strive for alignment of inventory levels with customer demand and current production schedules.

Cash provided by continuing operating activities during the first nine months of fiscal 2014 was $298.3 million, compared to $443.1 million during the first nine months of fiscal 2013. The decrease in cash provided by continuing operations was primarily due to lower earnings, higher inventory and the timing of income tax payments, partially offset by the collection of accounts receivable, advance payments on orders and reduced pension contributions.

Cash used by investing activities during the first nine months of fiscal 2014 was $107.3 million, compared to $115.1 million during the first nine months of fiscal 2013. The decrease in cash used by investing activities was primarily due to a decline in capital expenditures, partially offset by the current period acquisition of MTI.

Cash used by financing activities during the first nine months of fiscal 2014 was $287.3 million, compared to $91.8 million during the first nine months of fiscal 2013. The increase in cash used by financing activities was primarily due to treasury stock purchases of $194.3 million under the share repurchase program that was authorized in the fourth quarter of fiscal 2013.

On May 19, 2014, our Board of Directors declared a cash dividend of $0.20 per outstanding share of common stock. The dividend was paid on June 18, 2014 to all shareholders of record at the close of business on June 4, 2014. In addition, on August 19, 2014, our Board of Directors declared a cash dividend of $0.20 per outstanding share of common stock. The dividend will be paid on September 18, 2014 to all shareholders of record at the close of business on September 4, 2014.

Retiree Benefits

We sponsor pension plans in the U.S. and in other countries. The significance of the funding requirements of these plans is largely dependent on the value of the plan assets, the investment returns on the plan assets, actuarial assumptions, including discount rates, and the impact of the Pension Protection Act of 2006. For the nine months ended August 1, 2014, we contributed $5.8 million to our defined benefit employee pension plans, and we do not expect contributions to exceed $50.0 million for the full fiscal year.

During the current quarter, we substantially completed negotiations with certain of our U.S. bargaining units to freeze their respective defined benefit plans at the end of the calendar year. These actions resulted in a $7.8 million non-cash pension curtailment charge in the current quarter.

Credit Agreement

During the third quarter, improvements in the bank credit markets allowed us to refinance our $1 billion unsecured revolving credit facility and our $375 million unsecured term loan agreement. Under the refinancing we will realize interest expense savings and have more financial flexibility with less restrictive financial covenants under the respective agreements. The maturities on both agreements were extended to 2019 and, under the Term Loan, we will have lower required amortization.

39

On July 29, 2014, we entered into a $1.0 billion unsecured revolving credit facility that matures on July 29, 2019. Under the Credit Agreement, we also may request an increase of up to $250.0 million of additional aggregate revolving commitments, subject to the terms and conditions contained in the Credit Agreement. The Credit Agreement simultaneously replaced the $1.0 billion revolving credit agreement dated as of October 12, 2012, which was scheduled to expire on November 12, 2017. Under the terms of the Credit Agreement, we pay a commitment fee ranging from 0.09% to 0.30% on the unused portion of the revolving credit facility based on our credit rating. Letters of credit issued under applicable provisions of the Credit Agreement represent an unfunded utilization of the Credit Agreement for purposes of calculating the periodic commitment fee due. Eurodollar rate loans bear interest for a period from the applicable borrowing date until a date one week or one, two, three or six months thereafter, as selected by the Company, at the corresponding Eurodollar rate plus a margin of 1.0% to 2.0% depending on the Company's credit rating. Base rate loans bear interest from the applicable borrowing date at a rate equal to (i) the highest of (a) the federal funds rate plus 0.5%, (b) the rate of interest in effect for such day as publicly announced by the administrative agent as its "prime rate," or (c) a daily rate equal to the one-month Eurodollar rate plus 1.0%, plus (ii) a margin that varies according to the Company's credit rating. Swing line loans bear interest at either the base rate described above or the daily floating Eurodollar rate plus the applicable margin, as selected by the Company. The Credit Agreement is guaranteed by each of our current and future material domestic subsidiaries and requires the maintenance of certain financial covenants, including leverage and interest coverage ratios. The Credit Agreement also restricts payment of dividends or other returns of capital to shareholders when the consolidated leverage ratio exceeds a stated level amount. As of August 1, 2014, we were in compliance with all financial covenants of the Credit Agreement and had no restrictions on the payment of dividends or other returns of capital to shareholders.

As of August 1, 2014, there were no direct borrowings under the Credit Agreement. Outstanding standby letters of credit issued under the Credit Agreement, which count toward the $1.0 billion credit limit, totaled $176.3 million. As of August 1, 2014, there was $823.7 million available for borrowings under the Credit Agreement.

On July 29, 2014, we entered into a term loan agreement which matures July 29, 2019 and provides for a commitment of up to $375.0 million. The Term Loan amended our prior term loan, dated as of June 16, 2011. The Prior Term Loan had been scheduled to mature on July 16, 2016 and provided an initial commitment of $500.0 million, which had been drawn in full in conjunction with our fiscal 2011 acquisition of LeTourneau Technologies, Inc. and had been amortized to $375.0 million at the date of amendment. We utilized the $375.0 million commitment under the Term Loan to repay the balance outstanding under the Prior Term Loan. The Term Loan requires quarterly principal payments beginning in fiscal 2016 and contains terms and conditions that are the same as the terms and conditions of the Credit Agreement. The Term Loan is guaranteed by each of our current and future material domestic subsidiaries and requires the maintenance of certain financial covenants, including leverage and interest coverage ratios. As of August 1, 2014, we were in compliance with all financial covenants of the Term Loan.

On October 12, 2011, we issued $500.0 million aggregate principal amount of 5.125% Senior Notes due in 2021 at a discount of $4.2 million in an offering that was registered under the Securities Act. Interest on the 2021 Notes is paid semi-annually in arrears on October 15 and April 15 of each year, and the 2021 Notes are guaranteed by each of our current and future material domestic subsidiaries. At our option, we may redeem some or all of the 2021 Notes at a redemption price of the greater of 100% of the principal amount of the 2021 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 0.5%.

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. Interest on the 2016 Notes and 2036 Notes is paid semi-annually in arrears on May 15 and November 15 of each year, and the 2016 Notes and 2036 Notes are guaranteed by each of our current and future material domestic subsidiaries. The 2016 Notes and 2036 Notes were issued in a private placement under an exemption from registration provided by the Securities Act. In the second quarter of fiscal 2007, the 2016 Notes and 2036 Notes were exchanged for substantially identical notes in an exchange that was registered under the Securities Act. At our option, we may redeem some or all of the 2016 Notes and 2036 Notes at a redemption price of the greater of 100% of the principal amount of the 2016 Notes and 2036 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.

Stock Repurchase Program

In August 2013, our Board of Directors authorized the Company to repurchase up to $1.0 billion in shares of our common stock until August 2016. Under the program, the Company may repurchase shares in the open market in accordance with applicable SEC rules and regulations. During the quarter ended August 1, 2014, we purchased 1,091,602 shares of common stock for approximately $64.8 million. During the nine months ended August 1, 2014, we purchased 3,488,312 shares of common stock for approximately $194.3 million. Since its inception, the Company has repurchased 7,593,312 shares of common stock under the program for approximately $408.4 million, leaving $591.6 million available under the program.

40

Advance Payments and Progress Billings

As part of the negotiation process associated with original equipment orders, contracts generally require advance payments and progress billings from our customers to support the procurement of inventory and other resources. As of August 1, 2014, advance payments and progress billings were $397.5 million. As orders are shipped or costs are incurred, the advance payments and progress billings are recognized as revenue in the consolidated financial statements.

Financial Condition

We believe our liquidity and capital resources are adequate to meet our projected needs. We had $308.0 million in cash and cash equivalents as of August 1, 2014 and $823.7 million available for borrowings under the Credit Agreement. Requirements for working capital, dividends, pension contributions, capital expenditures, acquisitions, stock repurchases and principal and interest payments on our Term Loan and senior notes will be adequately funded by cash on hand and continuing operations, supplemented by short and long term borrowings, as required.

Off-Balance Sheet Arrangements

We lease various assets under operating leases. No significant changes to lease commitments have occurred since our year ended October 25, 2013. We have no other off-balance sheet arrangements.

New Accounting Pronouncements

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

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 25, 2013, we are exposed to various types of market risks, such as interest rate risk, commodity price risk and foreign currency risk. We monitor our risks on a continuous basis and generally enter into forward foreign currency contracts to minimize our foreign currency exposures. 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 year ended October 25, 2013.

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 on a timely basis 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 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 quarter ended August 1, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

41

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The information required by this Item is incorporated by reference from Note 14, Contingent Liabilities, to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q.

Item 1A. Risk Factors

During the quarter ended August 1, 2014, there were no material changes from the risk factors disclosed in Item 1A of our Annual Report on Form 10-K for our fiscal year ended October 25, 2013.

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

During the third quarter of fiscal 2014, we made the following purchases of our common stock:

Period	Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased Under the Publicly Announced Program*	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program* (in millions)
May 3, 2014 - May 30, 2014	255,800	$	57.83	255,800	$	641.6
May 31, 2014 - June 27, 2014	423,279	$	59.16	423,279	$	616.6
June 28, 2014 - August 1, 2014	412,523	$	60.60	412,523	$	591.6

* In August 2013, our Board of Directors authorized the Company to repurchase up to $1.0 billion in shares of common stock until August 2016. Under the program, the Company may repurchase shares in the open market in accordance with applicable SEC rules and regulations.

Item 3. Defaults upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.

42

Item 6. Exhibits

10.1	Form of Restricted Stock Unit Award Agreement, dated June 3, 2014, between the registrant and Mark J. Gliebe in connection with restricted stock unit awards granted under the Joy Global Inc. 2007 Stock Incentive Plan.
10.2	Amended and Restated Credit Agreement, dated as of July 29, 2014, among Joy Global Inc., as Borrower, the Guarantors, Bank of America, N.A., as Administrative Agent, JPMorgan Chase Bank, N.A. and Mizuho Bank (USA) as Co-Syndication Agents, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K dated July 29, 2014).
10.3	Second Amended and Restated Credit Agreement, dated as of July 29, 2014, among Joy Global Inc., as Borrower, the Guarantors, Bank of America, N.A., as Administrative Agent, a Swing Line Lender and an L/C Issuer, JPMorgan Chase Bank, N.A. as a Swing Line Lender and an L/C Issuer, and the lenders party thereto (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K dated July 29, 2014).
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
32.1	Section 1350 Certifications
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

43

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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, in the City of Milwaukee, Wisconsin, on September 5, 2014.

	JOY GLOBAL INC.
	(Registrant)
Date: September 5, 2014	/s/ James M. Sullivan
	James M. Sullivan
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)
Date: September 5, 2014	/s/ Matthew S. Kulasa
	Matthew S. Kulasa
	Vice President, Controller and Chief Accounting Officer
	(Principal Accounting Officer)

44