VANCOUVER, BRITISH COLUMBIA--(Marketwired - Apr 11, 2014) - Today, Finning International Inc. (FTT.TO) provided preliminary revenue numbers for the first quarter of 2014.
On a consolidated basis, revenues for the 2014 first quarter are expected to be approximately $1.676 billion, up 8% over prior year quarter. New equipment sales grew by 8% and product support increased by 9% over this period.
In Canada, first quarter revenues were approximately $891 million, an increase of 18% over Q1, 2013. New equipment revenue was approximately $340 million (up 35%) and product support revenue was approximately $445 million (up 13%) over this period.
In the company's South American operations, Q1, 2014 revenues were approximately $550 million, down 10% (or 18% in local currency) over the prior year quarter. As expected, new equipment revenues were significantly lower than the prior year quarter. New equipment revenues of approximately $216 million decreased by 24% (or 30% in local currency). Product support was up approximately $6 million or 2% (down approximately US$ 20 million or 7% in local currency).
In the UK & Ireland, first quarter revenues grew to approximately $236 million, an increase of 23% (5% in local currency) over the same period last year. New equipment revenues grew 27% to approximately $137 million (up 8% in local currency) and product support by 18% to approximately $75 million (up slightly in local currency) during the quarter.
As indicated during the company's quarterly earnings call on February 19, 2014, the first quarter results in Canada will be negatively impacted by the weakening of the Canadian dollar and the results from our South American operations will be affected by the Argentine peso devaluation, which will increase the effective tax rate.
The company is providing the preliminary first quarter revenues to ensure full disclosure after comments made by a Finning executive at a conference in Chile with respect to the current mining market environment in that country. The company will release its financial results for Q1, 2014 after market close on May 13, 2014.
Finning International Inc. (FTT.TO) is the world's largest Caterpillar equipment dealer delivering unrivalled service to customers for over 80 years. Finning sells, rents and provides parts and service for equipment and engines to help customers maximize productivity. Headquartered in Vancouver, B.C., the Company operates in Western Canada, Chile, Argentina, Bolivia, Uruguay, as well as in the United Kingdom and Ireland.
This report contains statements about the Company's business outlook, objectives, plans, strategic priorities and other statements that are not historical facts. A statement Finning makes is forward-looking when it uses what the Company knows and expects today to make a statement about the future. Forward-looking statements may include words such as aim, anticipate, assumption, believe, could, expect, goal, guidance, intend, may, objective, outlook, plan, project, seek, should, strategy, strive, target, and will. Forward-looking statements in this report include, but are not limited to, statements with respect to: expectations with respect to the economy and associated impact on the Company's financial results; expected revenue; EBIT margin; ROIC; market share growth; expected results from service excellence action plans; anticipated asset utilization, inventory turns and parts service levels; and the expected target range of the Company's net debt to invested capital ratio. All such forward-looking statements are made pursuant to the 'safe harbour' provisions of applicable Canadian securities laws.
Unless otherwise indicated by us, forward-looking statements in this report describe Finning's expectations at April 11, 2014. Except as may be required by Canadian securities laws, Finning does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.
Forward-looking statements, by their very nature, are subject to numerous risks and uncertainties and are based on several assumptions which give rise to the possibility that actual results could differ materially from the expectations expressed in or implied by such forward-looking statements and that Finning's business outlook, objectives, plans, strategic priorities and other statements that are not historical facts may not be achieved. As a result, Finning cannot guarantee that any forward-looking statement will materialize. Factors that could cause actual results or events to differ materially from those expressed in or implied by these forward-looking statements include: general economic and market conditions; foreign exchange rates; commodity prices; the level of customer confidence and spending, and the demand for, and prices of, Finning's products and services; Finning's dependence on the continued market acceptance of Caterpillar's products and Caterpillar's timely supply of parts and equipment; Finning's ability to continue to improve productivity and operational efficiencies while continuing to maintain customer service; Finning's ability to manage cost pressures as growth in revenues occur; Finning's ability to reduce costs in response to slowing activity levels; Finning's ability to attract sufficient skilled labour resources to meet growing product support demand; Finning's ability to negotiate and renew collective bargaining agreements with satisfactory terms for Finning's employees and the Company; the intensity of competitive activity; Finning's ability to raise the capital needed to implement its business plan; regulatory initiatives or proceedings, litigation and changes in laws or regulations; stock market volatility; changes in political and economic environments for operations; the integrity, reliability, availability and benefits from information technology and the data processed by that technology. Forward-looking statements are provided in this report for the purpose of giving information about management's current expectations and plans and allowing investors and others to get a better understanding of Finning's operating environment. However, readers are cautioned that it may not be appropriate to use such forward-looking statements for any other purpose.
Forward-looking statements made in this report are based on a number of assumptions that Finning believed were reasonable on the day the Company made the forward-looking statements. Refer in particular to the Outlook section of the Company's MD&A. Some of the assumptions, risks, and other factors which could cause results to differ materially from those expressed in the forward-looking statements contained in this report are discussed in Section 4 of the Company's Annual Information Form (AIF).
Finning cautions readers that the risks described in the AIF are not the only ones that could impact the Company. Additional risks and uncertainties not currently known to the Company or that are currently deemed to be immaterial may also have a material adverse effect on Finning's business, financial condition, or results of operations.
Except as otherwise indicated, forward-looking statements do not reflect the potential impact of any non-recurring or other unusual items or of any dispositions, mergers, acquisitions, other business combinations or other transactions that may be announced or that may occur after the date hereof. The financial impact of these transactions and non-recurring and other unusual items can be complex and depends on the facts particular to each of them. Finning therefore cannot describe the expected impact in a meaningful way or in the same way Finning presents known risks affecting its business.