Cervus Equipment (TSX:CERV) reported larger than expected drops in revenue and profit on slower sales – including from its Canadian Peterbilt dealerships – in its second-quarter financial results.
Cervus earned C$2.19 million, or C$0.18 per share, on C$327.6 million in revenue (the Canadian dollar equals US$0.76). Analysts expected C$0.51 per share on revenue of C$406.51, according to Yahoo Finance.
Revenue dropped by 20 percent compared to the second quarter of 2018. Adjusted income declined by 84 percent.
A 30 percent decline in sales of agricultural products led the weakness. Revenue from Cervus' transportation segment, largely from its network of Canadian Peterbilt truck dealerships, dropped by 8 percent to C$105.94 million
Photo: Cervus Equipment
"Our Western Canadian Agriculture operations are facing compounding headwinds that have highlighted opportunities to improve our profitability across market cycles," CEO Angela Lekatsas said in a statement.
Cervus blamed the transportation weakness on a "tapering" of truck sales on a weaker freight market compared to strong demand in 2018.
A drop in truck sales weighed on its first-quarter loss reported in May. The company said it expected sales to recover as it processes a backlog of orders.
Cervus executives will discuss the results with analysts tomorrow, August 9. Lekatsas transitioned to her role as CEO during the quarter, succeeding Graham Drake.
Image Sourced by Pixabay
See more from Benzinga
- Commentary: Cato Criticism Misses The Mark
- Revenue And Losses Climb At Uber Freight
- What The Truck?!? – Backhaul: FedEx Dumps Amazon…Again
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.