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Ritchie Bros. reports second quarter 2022 results

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VANCOUVER, BC, Aug. 4, 2022 /CNW/ - Ritchie Bros. Auctioneers Incorporated (NYSE: RBA) (TSX: RBA), (the "Company", "Ritchie Bros.", "we", "us", or "our") reported the following results for the three months ended June 30, 2022.

(All figures are presented in U.S. dollars)

"As our marketplace vision takes shape, Ritchie Bros. momentum continues with 10% GTV growth in the quarter despite a persistently tight supply environment. We are learning and gaining confidence from our growth initiatives and will continue to prudently invest in local yards, sales coverage and services to accelerate our topline while we advance our marketplace technology," said Ann Fandozzi, CEO of Ritchie Bros.

"We are pleased with our continued strong financial performance in the quarter with service revenue growth significantly outpacing our double digit GTV growth. For example, Ritchie Bros. Financial Services revenue grew 69% as our investments in this area continue to bear fruit," said Eric Jacobs, CFO of Ritchie Bros.

Net income attributable to stockholders decreased 12% to $53.4 million, compared to $60.7 million in the second quarter of 2021. Diluted earnings per share ("EPS") attributable to stockholders decreased 13% to $0.48 per share in the second quarter of 2022 as compared to $0.55 per share in the second quarter of 2021. Non-GAAP diluted adjusted EPS attributable to stockholders increased 10% to $0.74 per share in the second quarter of 2022 compared to $0.67 per share in the second quarter of 2021.

For the second quarter of 2022 as compared to the second quarter of 2021:

Consolidated results:

  • Total revenue increased 22% to $484.5 million

  • Operating income increased 3% to $91.9 million

  • Non-GAAP adjusted operating income increased 12% to $119.6 million

  • Net income decreased 12% to $53.4 million

  • Non-GAAP adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA) increased 11% to $136.2 million

  • Cash provided by operating activities was $198.0 million for the first six months of 2022

  • Cash on hand at the end of second quarter of 2022 was $531.7 million, of which $367.3 million was unrestricted, and restricted cash decreased 84% in the six month period ending June 30, 2022 as a result of the redemption of the Company's 2021 Notes1 in the quarter for $931.0 million

Auctions & Marketplaces segment results:

  • GTV2 increased 10% to $1.7 billion and increased 13% when excluding the impact of foreign exchange

  • A&M total revenue increased 22% to $433.0 million

Other Services segment results:

  • Other Services total revenue increased 29% to $51.5 million

In addition, the total number of organizations activated on the Company's Business Inventory Management System ("IMS"), a gateway into its marketplace, increased by 50% as compared to the first quarter of 2022.

___________________________________________

1 On December 21, 2021, the Company completed the offering of two series of senior notes: (i) $600,000,000 aggregate principal amount of 4.750% senior notes due December 15, 2031 (the "2021 USD Notes") and (ii) $425,000,000 Canadian dollar aggregate principal amount of 4.950% senior notes due December 15, 2029 (the "2021 CAD Notes", and together with the 2021 USD Notes, the "2021 Notes").


2 Gross Transaction Value ("GTV") represents total proceeds from all items sold at the Company's auctions and online marketplaces. GTV is not a measure of financial performance, liquidity, or revenue, and is not presented in the Company's consolidated financial statements.


The Company presents both generally accepted accounting principles ("GAAP") and non-GAAP measures to provide investors with additional information. Providing these non-GAAP measures along with GAAP measures allows for increased comparability of its ongoing performance from period to period. Non-GAAP financial measures referred to in this news release are labeled as "non-GAAP measure". Please see page 12-13 for explanations of why the Company uses these non-GAAP measures and the reconciliation to the most comparable GAAP financial measures.

Other Company developments:

  • On June 2, 2022, the Company announced the appointment of Eric Jacobs as its Chief Financial Officer, effective June 6, 2022. Sharon Driscoll, the former Chief Financial Officer, is remaining with the Company in an advisory capacity to assist with the transition prior to her previously announced retirement.

Financial Overview
(Unaudited)






















(in U.S. $000's, except EPS and percentages)


Three months ended June 30,


Six months ended June 30,










% Change









% Change



2022


2021



2022 over
2021


2022


2021



2021 over
2020

Commissions


$

136,403


$

129,334



5

%


$

252,778


$

233,309



8

%

Fees



150,099



123,414



22

%



278,585



225,469



24

%

Total service revenue



286,502



252,748



13

%



531,363



458,778



16

%

Inventory sales revenue



198,044



143,613



38

%



347,104



269,138



29

%

Total revenue



484,546



396,361



22

%



878,467



727,916



21

%

Costs of services



45,039



41,301



9

%



84,054



79,167



6

%

Cost of inventory sold



176,171



131,023



34

%



307,753



241,770



27

%

Selling, general and administrative



144,277



109,560



32

%



270,883



223,799



21

%

Total operating expenses



393,026



307,019



28

%



723,927



594,140



22

%

Gain on disposition of property, plant and equipment



347



175



98

%



170,167



243



69,928

%

Operating income



91,867



89,517



3

%



324,707



134,019



142

%

Operating income as a % of total revenue



19.0

%


22.6

%


(360)

bps



37.0

%


18.4

%


1,860

bps

Non-GAAP adjusted operating income



119,579



106,973



12

%



208,439



164,748



27

%

Non-GAAP adjusted operating income as a % of total revenue



24.7

%


27.0

%


(230)

bps



23.7

%


22.6

%


110

bps

Net income attributable to stockholders



53,365



60,749



(12)

%



231,459



88,937



160

%

Non-GAAP adjusted net income attributable to stockholders



83,072



74,545



11

%



134,035



110,540



21

%

Non-GAAP adjusted EBITDA



136,219



122,970



11

%



192,624



195,874



(2)

%

Diluted EPS attributable to stockholders


$

0.48


$

0.55



(13)

%


$

2.07


$

0.80



159

%

Non-GAAP diluted adjusted EPS attributable to stockholders


$

0.74


$

0.67



10

%


$

1.20


$

0.99



21

%

Effective tax rate



28.8

%


25.7

%


310

bps



20.0

%


24.9

%


(490)

bps

Total GTV



1,684,276



1,527,642



10

%



3,123,381



2,802,182



11

%

Service GTV



1,486,232



1,384,029



7

%



2,776,277



2,533,044



10

%

Service revenue as a % of total GTV - Rate



17.0

%


16.5

%


50

bps



17.0

%


16.4

%


60

bps

Inventory GTV



198,044



143,613



38

%



347,104



269,138



29

%

Service GTV as a % of total GTV - Mix



88.2

%


90.6

%


(240)

bps



88.9

%


90.4

%


(150)

bps

Inventory sales revenue as a % of total GTV - Mix



11.8

%


9.4

%


240

bps



11.1

%


9.6

%


150

bps

Certain amounts in the prior period have been reclassified from selling, general and administrative expenses to cost of services.

Segment Overview


















(in U.S $000's)


Three months ended June 30, 2022


Six months ended June 30, 2022



A&M


Other


Consolidated


A&M


Other


Consolidated

Commissions


$

136,403



$

136,403


$

252,778



$

252,778

Fees



98,588


51,511



150,099



183,217


95,368



278,585

Total service revenue



234,991


51,511



286,502



435,995


95,368



531,363

Inventory sales revenue



198,044




198,044



347,104




347,104

Total revenue



433,035


51,511



484,546



783,099


95,368



878,467

Ancillary and logistical service expenses




13,446



13,446




24,201



24,201

Other costs of services



28,985


2,608



31,593



54,559


5,294



59,853

Cost of inventory sold



176,171




176,171



307,753




307,753

Selling, general and administrative



125,535


18,742



144,277



234,346


36,537



270,883

Segment profit


$

102,344


16,715


$

119,059


$

186,441


29,336


$

215,777

Total GTV



1,684,276


N/A



N/A



3,123,381


N/A