Finning International last week reported 2006 fourth-quarter revenue from continuing operations of CD $1.4 billion (U.S. $1.2 billion, according to current currency exchange rates), a 26.4-percent increase over 2005’s fourth quarter, and a company record for the quarter. Earnings from continuing operations before interest and income taxes were CD $85.7, a 39.6 percent year-over-year jump. Fourth-quarter net income from continuing operations was $52.7 million or 59 cents per share, a 40.5 percent year-over-year increase in diluted earnings per share compared with the fourth quarter of 2005.
“Finning had a very strong fourth quarter, which capped an outstanding year,” said Doug Whitehead, president and CEO of Finning. “In 2006, our Canadian and South American operations continued their dramatic growth and our U.K. dealership operations more than doubled their contribution to earnings. Our order book is at an all-time high of $1.5 billion, and contains a number of large orders for mining trucks with deliveries ranging from 2007 to 2010. We are increasingly optimistic about the outlook for Finning over the next few years.”
Finning’s full-year 2006 numbers were also impressive. Revenue from continuing operations for the year increased 11.1 percent to $5.05 billion, with EBIT of $387.8 million, a 39.8 percent year-over-year jump.
Annual revenue hiked 27.5 percent at Finning’s Canadian operations, reflecting strong equipment sales to resource-based businesses and the general construction markets. EBIT for the Canadian operations was 8.9 percent, up from 7.3 percent in 2005.
The company’s South American operations experienced a significant revenue mix shift from equipment sales to customer support services with a modest revenue increase. Revenues increased 7 percent in local currencies, with 2006 EBIT of $108.9 million, increase of 16.7 percent year over year.
Annual revenues from Finning U.K.’s continuing operations decreased 4.1 percent in 2006, but in local currency total revenue increased 1 percent. The U.K. operation contributed $34.9 million of EBIT in 2006, more than double the 2005 total.
Canadian rental revenue increased 23 percent year over year to CD $240.4 million (about U.S. $208.2 million according to annualized average exchange rates). Total worldwide rental revenue was CD $849.6 million for the year, almost unchanged from 2005’s total of CD $851.3 million. The decrease was primarily the result of the 6.1 percent decrease by the U.K.’s Hewden in rental revenue when measured in Canadian currency.
Based in Vancouver, B.C., with Cat Rental operations based in Edmonton, Alberta, Finning is No. 16 on the RER 100.
