Ritchie Bros. Auctioneers Reports Second Quarter 2000 Results
9 August 2000
Ritchie Bros. Auctioneers Reports Second Quarter 2000 Results
VANCOUVER, B.C.--Aug. 9, 2000--Ritchie Bros. Auctioneers Incorporated achieved gross auction sales of $353.4 million during the three months ended June 30, 2000.Gross auction sales for the first half of 2000 totaled $643.3 million, an increase of 9.2% over the first half of 1999. In the first half of 2000, the Company significantly expanded its international network of offices and auction sites and increased its team of sales representatives by 12%.
David E. Ritchie, Chairman and CEO of the Company, stated, "We are pleased with our results for the first half of 2000 given the tight supply of used equipment caused by continued economic strength in most of our markets. We have continued our aggressive expansion plans and as a result I believe we are better positioned than ever to take advantage of future opportunities."
Gross auction sales were $643.3 million for the six months ended June 30, 2000, generating auction revenues of $56.3 million, compared to gross auction sales of $589.1 million and auction revenues of $53.6 million for the six months ended June 30, 1999, increases of 9.2% and 5.1% respectively. Net income after tax for the first six months of 2000 was $9.7 million, or $0.58 per diluted weighted average share, compared to $12.1 million or $0.72 per diluted share in the comparable 1999 period. All amounts are stated in US Dollars.
As a percentage of gross auction sales, auction revenues during the six months ended June 30, 2000 were 8.76%, lower than the rate of 9.10% experienced during the comparable 1999 period but roughly consistent with RBA's longer-term average.
During the first 6 months of 2000, Ritchie Bros. sold trucks and equipment for over 9,000 owners at 58 auctions held in 7 countries. The auctions attracted over 61,000 registered bidders.
For the quarter ended June 30, 2000, gross auction sales were $353.4 million, generating auction revenues of $29.6 million. The auction revenue rate was 8.37%. Net income after tax for the quarter was $6.1 million or $0.36 per diluted share.
Russell Cmolik, President and COO of Ritchie Bros., commented on the growth initiatives being pursued by the Company: "Our growth strategy continues to focus on the expansion of our international network of offices and auction sites, and the addition of quality sales people to our team. So far in 2000, we have opened new permanent auction sites in Perris, California; Morris, Illinois and most recently in Montreal, Quebec. We have also opened new facilities at our regional auction units in Dubai and Singapore and we are in the process of developing a new permanent auction site in Baltimore, Maryland and replacement permanent auction sites in Edmonton, Alberta; Prince George, British Columbia and Phoenix, Arizona."
"At the same time," continued Cmolik, "we have been adding salesmen and opening new sales offices around the world, including the recent addition of new offices in Jordan and Lebanon. We now have a network of over 80 offices and auction sites in 21 countries around the world. Our team of sales representatives has also been growing. As of June 30, 2000, we had 171 front-line sales representatives, an increase of 12% since the end of 1999. In an industry like ours, where customer service and customer relationships are critical to success, these initiatives are laying the groundwork for healthy future growth."
Commenting on the Company's Internet strategy, Mr. Ritchie stated: "To complement and enhance the growth of our live auctions, we are pursuing several Internet initiatives. In July we released the new premium service 'rbauctionRe$ults' on our website at www.rbauction.com. This service gives our customers access, for the first time, to our historic auction results - the best source of information available to truck and equipment owners who want to assess the value of their fleets. It also lays out, for all to see, the prices that we achieve at our live unreserved auctions. Initial response has been very positive and we look forward to using this web-based tool to introduce the Ritchie Bros. auction system to new customers around the world. Truck and equipment owners can now visit our website and see the very tangible results of the Ritchie Bros. difference."
Ritchie Bros. is the world's leading auctioneer of industrial equipment, operating through over 80 locations throughout North and Central America, Europe, Asia, Australia and the Middle East. The Company sells, through unreserved public auctions, a broad range of used industrial equipment including equipment utilized in the construction, transportation, mining, forestry, petroleum and agricultural industries. Ritchie Bros. is a public company; its common shares trade on the New York Stock Exchange under the ticker symbol RBA. It maintains a web site at www.rbauction.com.
Gross auction sales represent the aggregate selling prices of all items sold at auction; auction revenues consist principally of commissions earned and net profit on the sale of equipment purchased and sold by RBA as principal.
Please note: Ritchie Bros. is hosting a conference call to discuss its 2000 Q2 financial results at 8:00am Pacific (11:00am Eastern) on Wednesday, August 9, 2000. A live broadcast of the conference call can be accessed through Investor Broadcast Networks' Vcall website at www.vcall.com. To listen to the broadcast, please go to the website at least fifteen minutes early to register, and download and install any necessary audio software. A replay will be available on the same website shortly after the call
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The discussion in this press release relating to future operating periods contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) that involve risks and uncertainties, including, in particular, statements regarding anticipated activities and results for the remainder of 2000 and future years. These risks and uncertainties include: the many factors that impact on the supply of and demand for used equipment; fluctuations in the market values of used equipment; periodic and seasonal variations in operating results; potential delays in construction or development of auction sites; actions of competitors; and other risks and uncertainties as detailed from time to time in the Company's SEC reports. Actual results may differ materially. The Company does not undertake any obligation to update the information contained herein, which speaks only as of this date.
Consolidated Statements of Income (USD thousands)
6 mos ended 6 mos ended
30/6/2000 30/6/1999
Gross auction sales $ 643,282 $ 589,088
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Auction revenues $ 56,339 $ 53,602
Direct expenses 9,293 9,104
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47,046 44,498
Expenses
Depreciation and amortization 3,706 2,234
General and administrative 28,039 23,452
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Income from operations 15,301 18,812
Other income (expenses)
Interest expense (1,656) (920)
Other income 585 512
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Income before income taxes 14,230 18,404
Income taxes 4,512 6,301
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Net income $ 9,718 $ 12,103
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Net income per share $ 0.58 $ 0.73
Net income per share - diluted
(US GAAP) $ 0.58 $ 0.72
Weighted average shares outstanding 16,739,666 16,644,493
Diluted weighted average shares
outstanding (US GAAP) 16,861,843 16,851,937
Consolidated Statements of Income (USD thousands)
3 mos ended 3 mos ended
30/6/2000 30/6/1999
Gross auction sales $ 353,354 $ 387,288
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Auction revenues $ 29,570 $ 35,589
Direct expenses 5,367 6,352
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24,203 29,237
Expenses
Depreciation and amortization 1,988 1,500
General and administrative 12,952 11,550
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Income from operations 9,263 16,187
Other income (expenses)
Interest expense (910) (677)
Other income 251 245
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Income before income taxes 8,604 15,755
Income taxes 2,495 5,284
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Net income $ 6,109 $ 10,471
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Net income per share $ 0.36 $ 0.63
Net income per share - diluted
(US GAAP) $ 0.36 $ 0.62
Weighted average shares outstanding 16,743,484 16,716,039
Diluted weighted average shares
outstanding (US GAAP) 16,858,733 16,984,669
Selected Balance Sheet Data (USD thousands)
30/6/2000 30/6/1999
Working capital $ 25,233 $ 47,075
Total assets 288,306 265,499
Total liabilities 146,058 141,061
Total shareholders' equity 142,248 124,438
Selected Operating Data
30/6/2000 30/6/1999
Auction revenues as percentage of
gross auction sales (6 mos) 8.76% 9.10%
Number of consignors (6 mos) 9,243 8,146
Number of buyers (6 mos) 21,182 19,539
Number of permanent auction sites 20 17
Number of regional auction units 5 5