Ritchie Bros. Auctioneers last week announced that it achieved net earnings of $16.4 million, or $0.16 per diluted weighted average share, for the first quarter of 2008, compared to net earnings of $17.6 million, or $0.17 per diluted weighted average share, for the first quarter of 2007. All dollar amounts are presented in U.S. dollars and, except as noted otherwise, all share and per share amounts reflect the three-for-one split of the company's common shares that occurred at the close of business on April 24.
Gross auction proceeds for the three months ended March 31, were $782 million, 12-percent higher than gross auction proceeds for the first quarter of 2007. Auction revenues increased 19 percent to $81.4 million for the quarter ended March 31, compared to the first quarter of 2007, and the company's auction revenue rate (auction revenues as a percentage of gross auction proceeds) was 10.4 percent in 2008. Ongoing investments in the company's growth initiatives resulted in increased operating expenses during the first quarter of 2008, which led to a decrease in net earnings for the first quarter of 2008 compared to net earnings in the first quarter of 2007.
Ritchie Bros. conducted 32 unreserved industrial auctions and five unreserved agricultural auctions in nine countries throughout North America, Europe, the Middle East and Australia during the quarter. It set three regional gross auction-proceeds records during the quarter, including the largest auction in the company's history, held in February 2008 at its permanent auction site in Orlando, Fla., with gross auction proceeds of $190 million.
The company had almost 60,000 bidder registrations at its unreserved industrial auctions in the first quarter of 2008, of which approximately 16,000 were successful buyers. In the first quarter of 2007, the company had more than 55,000 bidder registrations, of which approximately 16,000 were buyers.
“We are very pleased with the gross auction proceeds and auction revenue growth we accomplished during the first quarter,” said Peter Blake, Ritchie Bros. CEO. “We continued to take steps to position our business for sustainable long-term earnings growth by hiring more great people, expanding our international network of auction sites and investing in process improvement initiatives, and this resulted in higher operating expenses in the first quarter of 2008. Our quarterly earnings have always been variable, which is why we believe it is important to focus on our annual results.”
In other company news, the board of directors announced the appointment of James Micali as a director of the company effective April 25. Micali is currently chairman and president of Michelin North America, with responsibility for Michelin's operations in North America.
Coincident with the appointment of Micali, the company's board of directors increased the total number of directors of the company from six to seven.
In addition, effective April 25, Robert Armstrong, formerly chief operating officer and chief financial officer, was appointed chief operating officer of the company and Robert McLeod, formerly director, global accounting, was appointed chief financial officer.
The board of directors also declared a quarterly cash dividend of $0.08 per common share payable on June 13, to shareholders of record on May 23.
Established in 1958, Vancouver, Canada-based Ritchie Bros. is an international auctioneer of industrial equipment, operating from more than 110 locations in 27 countries around the world. The company sells, through unreserved public auctions, a broad range of used and unused industrial equipment including trucks, equipment and other assets used in the construction, transportation, mining, forestry, petroleum, materials handling, marine, real estate and agricultural industries.
