Finning, one of the world’s largest Caterpillar dealerships, posted $1.953 billion in first quarter 2022 revenue, compared to $1.596 billion in the first quarter of 2021, a 22.4-percent year-over-year increase. Net revenue increased 18.2 percent from $1.469 billion in Q121 to $1.736 billion this year.
Rental revenue was up 54 percent from Q1 2021, reflecting strong customer demand in a constrained supply environment in this year’s quarter, compared to softer market conditions including certain pipeline and construction work stoppages in Q1 2021.
Consolidated equipment backlog was $2.1 billion at the end of the first quarter, up from $1.9 billion at the close of the first quarter a year ago.
“We are pleased with the strong start to 2022 as our global teams remain focused on capturing market opportunities in a disciplined manner and executing on our plan to grow product support, reduce costs, and reinvest free cash flow to compound our earnings,” said Scott Thomson, president and CEO of Finning International. “Our Q1 2022 product support revenue was up significantly across all our regions and market sectors compared to Q1 2021. We continued to build a healthy inventory position to support backlog delivery, grow our rebuild business, and provide used and rental options to meet our customers’ needs as equipment availability remained constrained. We are actively managing inflationary pressures through our continued focus on productivity gains, resulting in improved operating leverage in all regions compared to Q1 2021.
“The market outlook remains positive in all our regions, supported by strong commodity prices, public and private sector investment, and economic growth forecasts. With a very strong equipment backlog, increasing arrival of inventory, and growing demand for product support, we are ramping up for increased activity for the remainder of the year and targeting above mid-teens EPS growth in 2022.”
Western Canada net revenue jumps
In Canada, net revenue increased by 14 percent from Q1 2021, driven by product support, as well as higher new equipment and rental revenues. Used equipment sales were below Q1 2021 mostly because of a large fleet of used mining equipment delivered in Q1 2021 and tight used equipment availability in Q1 2022. Product support revenue was up 18 percent from last year’s first quarter, reflecting increased spending by Finning customers in the mining sector and strong execution of its product support growth strategy in construction. New equipment sales were up 11 percent from Q1 2021, driven largely by mining deliveries.
In South America’s operations, net revenue increased by 18 percent from last year’s first quarter, with higher activity across all sectors, especially in mining.
In Finning’s U.K. and Ireland operations, net revenue increased by 35 percent from last year’s first quarter, driven by new equipment deliveries to construction customers, and stronger product support activity in all sectors.