Mississauga, Ontario, Canada-based Wajax Ltd. posted a 3.4-percent year-over-year revenue increase in the third quarter. Mobile equipment segment revenues decreased 1 percent on lower equipment sales offset by an 18-percent jump in parts and service volumes. Sales in the Power Systems division increased 6 percent, largely the result of an 11 percent boost in aftermarket volume.
The Industrial Components divisionâ€™s revenue jumped 11 percent, with improved revenue in most regions and the September acquisition of Weir Process Equipment, a leading distributor of pumps, process controls and instrumentation, filtration products and material handling equipment. The acquisition of Weir, which has approximately $50 million of adjusted annual sales, will expand the presence of Industrial Components in the Canadian process equipment market.
Wajax has three core distribution businesses engaged in the sale and after-sales parts and service support of mobile equipment, power systems and industrial components, through a network of more than 100 branches across Canada. Its customer base spans natural resources, construction, transportation, manufacturing, industrial processing and utilities.
"We continue to be pleased with our results as we benefited from strong performances in all three businesses in the third quarter,â€ť said CEO Neil Manning. â€śRevenue in all businesses held up well, despite the challenging economic environment. Parts and service revenue continues to show excellent growth, particularly in Mobile Equipment as we benefit from servicing equipment sold in previous years. Revenue in Industrial Components also showed resiliency and will further benefit from the Weir acquisition. Looking forward, we are concerned about the magnitude of the effect of the global financial crisis on the broader Canadian economy and our end markets. However, we anticipate a continuing contribution from our solid backlog of mining and power generation equipment orders and further growth in aftermarket support revenue. As well, we have adequate debt financing in place with a December 2011 maturity for our $175 million bank term facility. As a result, we continue to expect 2008 full year earnings to show improvement over the previous year."
Wajax also has a significant rental business and is No. 39 on the RER 100, with rental volume in U.S. dollars of $47.2 million.