Canadian distributor Wajax posted first quarter revenue of $318.4 million, compared to $285 million for the first quarter of 2016, an 11.7 percent increase attributed to higher revenue in Western Canada related to improved volumes in construction, mining and forestry. Regionally, revenue jumped 25.4 percent in Western Canada, 4.5 percent in central Canada, and 1 percent in Eastern Canada.
Equipment sales improved markedly from $79 million in the first quarter a year ago to $93.3 million, an 18.1-percent hike. Equipment rental was flat, basically, improving from $12.4 million in Q116 to $12.5 million in this year's first quarter.
The company generated net earnings of $6.2 million from increased revenue and decreased selling and administrative expenses.
Compared to the fourth quarter of 2016, consolidated backlog increased $34.2 million, or 27 percent, primarily from higher equipment orders. Compared to the first quarter of 2016, consolidated backlog decreased $45.8 million or 22 percent, primarily because of a drop in mining equipment orders.
“We are satisfied with the improvement in our first quarter results which benefitted from improved volumes in western Canada,” said Mark Foote, president and CEO of Wajax. “In addition, the broad improvement in equipment sales, industrial parts, product support and lower selling and administrative expenses demonstrates the effectiveness of our reorganization.
“Although the first quarter results are positive, we continue to expect that most major resource and industrial markets will remain under continued spending constraints and margin pressures for the remainder of 2017. We will remain focused on generating revenue sufficient to offset the four large mining shovel deliveries made in 2016, we are not expected to be repeated in 2017, managing our margins effectively and ensuring we deliver the annualized savings expected from our reorganization. Assuming the achievement of these objectives, management anticipates adjusted net earnings in 2017 will increase compared to 2016 adjusted net earnings.”
Wajax is based in Mississauga, Ontario, Canada.
