Their business is tied to a combination of items. There is a component of demand for their product driven by general maintenance of mining equipment and infrastructure. This part of their business is generally stable with low variations in demand, as equipment wears and needs to be replaced.
That demand is driven by general production levels at mines. They primarily support the iron ore industry, though, they also provide products into other mine types (coal, copper, gold, etc.). So as long as production activity remains strong, this maintenance portion of their business continues to grow.
The spikes in performance that you'll see for the company are related to capital spending on new iron ore mining projects. This is driven by iron ore pricing and the general supply/demand characteristics of the iron ore industry. There have been several announcements over the past year or so related to new mine projects in Western Australia from the large iron ore miners. This is what I believe is driving this most recent increase in financial performance, in addition to new products (ceramics, bilets, etc.) and services (laser cutting). While the mine issues in Brazil are a major humanitarian crisis, they have resulting in reductions in capacity in the industry, which have driven iron ore prices higher. They are also likely to increase the amount of regulation around the industry in Brazil. This makes future projects for new mines more attractive in areas like Western Australia, where the type of mining is different. More activity in Western Australia is positive for AYSI.
To get back to your originally thesis, yes, I do believe that the recent jump in iron ore prices should provide support for AYSI's business for the forseeable future, in addition to the general trends in the industry and their expansion into new lines of products/services.
