Canadian distributor Wajax posted CDN $317.2 million in revenue for the first quarter of 2015, down from $331.4 million in the first quarter of 2014, a 4.3-percent decline. Equipment and Power Systems segment revenue declined 9 percent and 3 percent respectively while the Industrial Components segment increased 2 percent.
Reduced activity in the mining, oil and gas and oil sands sectors negatively affected revenue from western Canada in all three segments. In the Industrial Components segment, this was offset by stronger sales in Ontario and eastern Canada.
“As expected, weakness in oil and other commodity prices had a negative effect on our customers in the mining, oil and gas and oil sands markets in western Canada, resulting in lower first quarter revenue and earnings,” said Mark Foote, president and CEO. “The impact was most significant in the Equipment segment, which experienced a 17-percent reduction in parts and service revenues as oil sands operators and miners idled portions of their equipment fleets. Conversely, operations in central Canada improved. This was particularly evident for the Equipment and Industrial Components where sales in those regions increased 40 percent and 12 percent respectively.
“Our focus in 2015 continues to be centered on three objectives: cost management, managing our asset base and debt level, and executing a prudent investment plan to support our 4 Points of Growth strategy.”
Foote said the company expects 2015 will be a challenging years with the western Canada economy likely to be soft. “However, we are very confident that our growth strategy and responsiveness to market conditions will result in an improving business in the medium term and a strong growth company for the future.”
Wajax, also a major player in rental, is based in Mississauga, Ontario.