Toromont Industries, owner of the Caterpillar dealership for Ontario and Battlefield Equipment Rentals, the Cat Rental Store, posted a 10-percent revenue decrease in the second quarter, dropping to CA$484.2 million (about U.S. $440 million), compared with CA$536.5 million for the same period in 2008. Earnings per share were CA$0.51, compared to CA$0.51 percent for the year-ago period.
“Good project management coupled with effective expense control resulted in comparable operating income to last year on a 10-percent reduction in revenue,” said Robert Ogilvie, Toromont chairman and CEO. “Toromont continued to benefit from the large backlogs that were carried into this year as well as from favorable movements in exchange rates.”
The equipment group revenues dropped 24 percent in the quarter compared with the same period last year, with lower new and used machine sales. Operating income plunged 18 percent compared to the year-ago period, on lower volumes, partly offset by higher gross margins. Bookings dropped 31 percent.
“The equipment group is experiencing reduced bookings related to the general economic slowdown,” added Ogilvie. “Certain markets continue to perform well, and the announced stimulus spending for Canadian infrastructure looks promising, although the timing and extent of impact is unclear. Unless compression and equipment market conditions improve substantially in the near term, second-half results are not likely to approach the record results seen in the second half of 2008.”
Equipment rental revenues dropped 6 percent to CA$31.8 million (about U.S. $28.9 million.) For the first six months of 2009, equipment rental volume totaled CA$59.4 million, a 3-percent drop from CA$61 million for the first six months of 2008. The company said lower utilization and lower rental rates caused the decline.
Toromont also announced a regular quarterly dividend of CA $0.15 (U.S. $0.13) per share on outstanding common shares, payable Oct. 1, to shareholders of record on Sept.15.
Toromont is headquartered in Toronto. Its equipment rental unit, Battlefield Equipment Rentals, based in Stoney Creek, Ontario, is No. 24 on the RER 100.