Vancouver, B.C., Canada-based Finning posted CDN $1,581 million in second quarter revenue, up from $1,310 million in the second quarter last year, a 20.7 percent year-over-year increase. Finning, the world’s largest Caterpillar dealer, representing western Canada, U.K. and Ireland, Chile, Bolivia and Argentina, reported a 25-percent revenue hike in Canada, with higher revenues in all lines of business except used equipment sales.
New equipment sales leaped 50 percent, driven by engine sales to gas compression customers, and higher deliveries of mining equipment. Product support revenues grew 21 percent, with strong demand for parts and component rebuilds in the oil sands, as well as improved product support activity in Alberta, which increased 11 percent year over year excluding the estimated impact of the wildfires in 2016.
Rental revenues were largely flat year over year.
“Our second quarter results demonstrate strong operating leverage as we continue to benefit from operating performance improvements and a reduced cost base,” said Scott Thomson, president and CEO of Finning International. “Strengthening demand for equipment and product support n all our regions had a positive impact on our results, and we now expect our annual revenues to increase modestly over 5 percent compared to 2016. To meet stronger demand, we are purchasing inventories while maintaining capital discipline. Continued progress to optimize our supply chain is driving improvements in our working capital sales ratio. Importantly, our consistent focus on profitability and capital discipline generated higher return on invested capital in each of our regions during the quarter.”
