Ritchie Bros. Auctioneers Inc. (RBA,RBA.TO), the world's largest auctioneer of industrial equipment, reported Thursday a decline in profit for the fourth quarter, mainly due to lower auction revenues. Quarterly earnings per share as well as top line missed market projections.
The Burnaby, Canada-based company's fourth-quarter net earnings decreased to $13.52 million or $0.13 per share from $21.83 million or $0.21 per share last year.
On average, 16 analysts polled by Thomson Reuters expected earnings of $0.15 per share for the quarter. Analysts' estimates typically exclude one-time items.
Auction revenues for the quarter declined 9 percent to $88.30 million from $97.14 million in the prior-year quarter, and missed Wall Street analysts' consensus estimates of $92.35 million.
Gross auction proceeds, representing the total proceeds from all items sold at Ritchie Bros. Auctions, for the three-month period slipped 10 percent to $798.57 million from $891.11 million.
Excluding the impact of fluctuations in the value of the U.S. dollar, auction revenues and gross auction proceeds decreased 8 percent and 10 percent, respectively, from last year.
For fiscal 2010, net earnings were $65.91 million or $0.62 per share, compared to $93.45 million or $0.88 per share last year. Adjusted net earnings fell 29 percent to $65.16 million or $0.61 per share from $92.04 million or $0.87 per share in 2009. Auction revenues for the year were $357.37 million, compared to $377.21 in 2009.
Chief Executive Officer Peter Blake stated, "Our results in 2010 reflected the challenging environment in which we operated, like many companies in our industry, and the difficulties we faced securing equipment consignments to sell at our auctions. The widely hoped-for recovery in the used equipment market did not materialize, and there was not a meaningful improvement in fundamentals or optimism during the year."
Looking ahead, Ritchie Bros. noted that, in the beginning of the year 2011, it sees many signs of the used equipment market returning to a more balanced state.
Blake continued, "Equipment owners are more optimistic, OEM production is increasing to satisfy growing demand, and pricing has improved on most equipment categories... Although competition is intense, these are all positive signs for our ability to grow our business in 2011."
RBA closed Wednesday's regular trading session at $26.43, down $0.01 or 0.04 percent.
Meanwhile, RBA.TO increased C$0.03 or 0.11 percent on Wednesday to close at C$26.20.
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