Canadian distributor Wajax posted $374.6 million in total revenue in the first quarter compared to $342.4 million in the first quarter of 2018, a 9.4-percent increase. Equipment rental revenue was $8.9 million in the first quarter compared to $8 million in the year-ago quarter, an 11.2-percent jump. Product support revenue increased to $124.3 million compared to $105.7 million last year, a 17.6-percent surge. Only equipment sales slid, from $123.9 million a year ago to $112.1, a 9.5-percent drop.
Revenue in eastern Canada was $140.9 million, a 25-percent year-over-year increase, while revenue in western Canada increased 1 percent and revenue in central Canada increased 3 percent.
“Results in the first quarter were consistent with our expectations,” said president and CEO Mark Foote. “Revenue growth of 9 percent resulted from increased sales in product support, ERS and industrial parts that more than offset a year-over-year decline in new equipment sales. Equipment sales declines were primarily due to western Canada and were partially offset by equipment sales strength in eastern Canada.
“We expect generally stable market conditions in eastern and central Canada in 2019. Market conditions in western Canada are expected to be less favorable than 2018. In western Canada, activity remains stable to positive in important end markets such as the oil sands and mining but is expected to slow temporarily in areas such as conventional oil and gas, forestry, construction and related markets. Wajax believes that 2019 market conditions in western Canada are more favorable than those that prevailed in 2015 and 2016. While recognizing the possible effect of these market conditions, we have not changed our financial targets or operational plans which remain consistent with the original goals of our strategic plan. We expect full year adjusted net earnings to increase over 2018 based on consolidated revenue improvements and the full year effect of the acquisition of Delom. 2019 is an important year for major projects such as the new ERP and Customer Support Centers, both of which are scheduled to begin implementation in the first half of 2019. Our current view of the timing of revenue and costs suggests that the expected earnings improvements will be weighted to the second half of the year.”