Canadian distributor Wajax posted a 1.5-percent total revenue decline in the first quarter, with CDN $331.4 million (about U.S. $304.2 million), compared to $336.3 million in the first quarter a year ago. Revenue in the equipment and power systems divisions, which include Wajax’ rental activity both declined slightly. Revenue in the equipment division dropped from $167.4 million a year ago to $165.6 million, while power systems volume dropped from $79.9 million to $77.1 million.
Net earnings declined year-over-year from $10.4 million in Q113 to $6.7 million this year.
“First quarter earnings were less than expected, with the vast majority of the shortfall occurring in the first two months,” said Wajax president and CEO Mark Foote. “The year began slowly from a revenue standpoint, and we absorbed a $1.3 million increase in severance costs in the quarter. While we continue to expect 2014 to be a challenging year without a marked improvement in the key markets of mining and oil and gas, first quarter earnings are not representative of our current outlook for the full year.
“Demand from mining market continues to be soft with activity being reduced or curtailed at some sites, however, quoting activity in the oil sands remains at a reasonable level. Oil and gas markets continue to be at cyclically low levels regarding investment in new drilling and fracking capacity, but with rig utilization improving there is some room for optimism regarding the need for equipment refurbishment and future capacity investment. We remain very confident in our opportunities for growth and we will continue to invest with a view to the long term.”
Based in Mississauga, Ontario, Wajax is No. 50 on the RER 100.