Canadian distributor Wajax posted third quarter revenue of $286.6 million, slightly down compared to its Q3 2015 total of $290.9 million. For the first nine months of 2016 it totaled $908.2, a 4.3-percent drop from $948.9 in Q316. Wajax’s equipment revenue, which includes its rental numbers, increased slightly year over year from $129.3 million to $138.9 million in the third quarter, a 7.4-percent hike.
“As expected, third quarter net earnings improved compared to the second quartered and included $1 million in insurance proceeds related to the Fort McMurray wildfires,” said Mark Foote, president and CEO. “We are particularly pleased by the improvement in our Power Systems, where our cost reduction and margin improvement initiatives began to pay off despite continuing challenges in the Western Canada market. Consolidated net earnings were up slightly compared to the previous year as savings from our restructuring activities were more fully realized. This net earnings improvement was achieved despite lower revenue and a $2.8 million gain on the monetization of mining trucks recorded in third quarter of 2015.”
Equipment segment revenue increased 7 percent or $9.6 million because of improved mining equipment and parts and service volumes, including the sale of a large oil sands mining shovel, offset partially by lower construction volumes in western and central Canada. In the nine month period, consolidated revenue in Wajax’s Fort McMurray and Fort MacKay branches slid about $8.3 million from last year primarily from the impact of the Fort McMurray wildfires in the second quarter of this year.
Wajax expects market conditions for the remainder of 2016 to remain challenging, particularly in Western Canada. “We expect fourth quarter earnings will continue to benefit from the earnings improvement initiatives implemented in the Power Systems segment and from the completion of our reorganization,” added Foote.
Wajax is No. 54 on the RER 100.
