Ritchie Bros. Auctioneers Incorporated

Ritchie Bros. Auctioneers Incorporated

February 24, 2005 07:00 ET

Ritchie Bros. Auctioneers Reports Strong Results For 2004


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: RITCHIE BROS. AUCTIONEERS INCORPORATED

TSX, NYSE SYMBOL: RBA

FEBRUARY 24, 2005 - 07:00 ET

Ritchie Bros. Auctioneers Reports Strong Results For
2004

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Feb. 24, 2005) - Ritchie
Bros. Auctioneers Incorporated (TSX:RBA)(NYSE: RBA) today announced its
financial results for the year ended December 31, 2004. The Company's
net earnings for 2004 were $34.9 million, or $1.01 per diluted weighted
average share, compared to $36.6 million, or $1.07 per diluted share, in
2003. Excluding the effects of a $2.1 million charge to income taxes
that is not expected to recur in future periods, net earnings would have
been $37.0 million, or $1.07 per diluted weighted average share. All
dollar amounts are presented in United States dollars, and per share
amounts reflect on a retroactive basis the two-for-one split of the
Company's common shares that occurred at the close of business on May 4,
2004.

Gross auction sales for the year ended December 31, 2004 were a record
$1.79 billion, 15% higher than gross auction sales reported in 2003.
Auction revenues in 2004 were $182.3 million, an increase of 13%
compared to the prior year. The Company's auction revenue rate (auction
revenues divided by gross auction sales) was 10.19% in 2004, compared to
10.36% in 2003.

Ritchie Bros. held 147 industrial auctions in 10 countries throughout
North America, Europe, the Middle East, and Australia in 2004. The
Company set eight regional gross auction sales records during the year.
The Company also held 93 smaller agricultural auctions in 2004, which
generated gross auction sales of $45.2 million.

As part of its continuing expansion into new markets, the Company opened
sales offices or hired sales representatives for the first time in:
Tehran, Iran; Beijing, China; and New Delhi, India. The Company also
sold more items and served more customers than in any prior year. During
2004, Ritchie Bros. sold over 178,000 lots from nearly 25,000
consignments and had more than 202,000 bidder registrations at its
auctions. Internet bidding continued to enhance the Company's live
auctions, and in 2004 the Company sold almost $200 million worth of
trucks and equipment to on-line buyers using the Company's
rbauctionBid-Live system.

Although the Company's auctions varied in size in 2004, the average
Ritchie Bros. industrial auction in 2004 attracted over 1,300 bidders
and featured over 1,200 lots consigned by almost 170 consignors,
generating average gross auction sales of approximately $12.0 million
per industrial auction, all of which represented increases over the
equivalent 2003 statistics.

Peter Blake, the Company's CEO, observed: "I am very pleased that we
have delivered another record-breaking gross auction sales result, which
is continuing evidence that our strategy is working. We continued to see
the results of our strategy of increasing our penetration into the
global used truck and equipment markets. In 2004 we introduced thousands
of truck and equipment owners in many and diverse regions of the world
to the Ritchie Bros. unreserved auction model - we have now entered some
significant new regional markets, and we are excited about the
opportunities in front of us. The global used truck and equipment
markets have become increasingly transparent in recent years and as a
result, buyers and sellers of equipment are choosing to take advantage
of the most efficient marketplaces. This is a trend that favored Ritchie
Bros in 2004 and that we expect will continue to work to our advantage
in 2005."

For the quarter ended December 31, 2004, gross auction sales were $549.8
million, generating auction revenues of $57.1 million. The auction
revenue rate was 10.39%. Net earnings for the quarter were $11.3
million, or $0.33 per diluted weighted average share. Excluding the
impact of a charge to the Company's income tax provision that is not
expected to recur in future periods, net earnings would have been $12.6
million or $0.36 per share.

Gross auction sales represent the aggregate selling prices of all items
sold at auction and are not presented in the Company's consolidated
financial statements; the comparable financial statement measure is
auction revenues, consisting primarily of commissions earned on
consigned equipment and net profit on the sale of equipment purchased by
Ritchie Bros. and sold in the same manner as consigned equipment.

About Ritchie Bros.

Ritchie Bros. is the world's largest auctioneer of industrial equipment,
operating through over 110 locations in more than 25 countries around
the world. The Company sells, through unreserved public auctions, a
broad range of used industrial equipment including trucks and equipment
used in the construction, transportation, mining, forestry, petroleum,
materials handling, marine and agricultural industries. Ritchie Bros.
maintains a website at www.rbauction.com.

Earnings Conference Call

Ritchie Bros. is hosting a conference call to discuss its 2004 financial
results at 8:00am Pacific Time (11:00am Eastern Time) on February 24,
2005. To access a live broadcast of the conference call, please go to
the Ritchie Bros. website http://www.rbauction.com, click on 'About
Ritchie Bros.' then click on 'Investor Information'. Please go to the
website at least fifteen minutes early to download and install any
necessary audio software. A replay will be available on the website
shortly after the call.

Forward-looking Statements

The discussion in this press release relating to future operating
periods contains forward-looking statements (as defined in Section 21E
of the Securities Exchange Act of 1934, as amended) that involve risks
and uncertainties, including, in particular, statements regarding
anticipated results for future periods; opportunities in new markets;
the percentage of internet bidders that are the buyers or runner-up
bidders of lots broadcast on the internet; and the implementation of the
Company's growth strategy. These risks and uncertainties include: the
many factors that impact on the supply of and demand for used equipment;
fluctuations in the market values of used equipment; periodic and
seasonal variations in operating results; actions of competitors; the
success of the Company's Internet initiatives; and other risks and
uncertainties as detailed from time to time in the Company's SEC and
Canadian securities filings, including the Company's Management's
Discussion and Analysis of Financial Condition and Results of Operations
for the year ended December 31, 2004, available on the SEC, SEDAR and
Company's websites. Actual results may differ materially. The Company
does not undertake any obligation to update the information contained
herein, which speaks only as of this date.



Consolidated Statements of Operations
(USD thousands, except share and per share amounts)

Year ended Year ended
December 31, December 31,
2004 2003
--------------------------------

Gross auction sales $ 1,789,402 $ 1,559,393
--------------------------------
--------------------------------

Auction revenues $ 182,257 $ 161,542
Direct expenses 23,472 22,099
--------------------------------
158,785 139,443
Expenses
Depreciation 12,708 11,773
General and administrative 85,667 71,265
--------------------------------

Earnings from operations 60,410 56,405

Other income (expenses)
Interest expense (3,217) (4,772)
Other income 1,053 1,060
--------------------------------

Earnings before income taxes 58,246 52,693

Income taxes (1) 23,347 16,099
--------------------------------

Net earnings $ 34,899 $ 36,594
--------------------------------
--------------------------------

Net earnings per share $ 1.02 $ 1.08
Net earnings per share - diluted $ 1.01 $ 1.07

Weighted average shares outstanding 34,160,678 33,795,978
Diluted weighted average shares
outstanding 34,499,222 34,137,552

Net earnings in accordance with GAAP $ 34,899 $ 36,594
Adjustment relating to non-recurring
income taxes (1) 2,106 -
--------------------------------
Adjusted net earnings $ 37,005 $ 36,594
--------------------------------
--------------------------------

Adjusted net earnings per share $ 1.08 $ 1.08
Adjusted net earnings per share
- diluted $ 1.07 $ 1.07

(1) Income taxes for the year ended December 31, 2004 include a
charge of $2,106 relating to the realization of foreign exchange
gains recorded at the subsidiary level in connection with term
debt that came due in the second half of 2004. The Company does
not expect to incur a similar charge in subsequent periods.
Excluding this charge, income taxes for the year ended December
31, 2004 would have been $21,241.


Consolidated Statements of Operations
(USD thousands, except share and per share amounts)

3 mos ended 3 mos ended
December 31, December 31,
2004 2003
--------------------------------
(unaudited) (unaudited)

Gross auction sales $ 549,796 $ 477,107
--------------------------------
--------------------------------

Auction revenues $ 57,142 $ 47,719
Direct expenses 8,067 6,899
--------------------------------
49,075 40,820
Expenses
Depreciation 3,455 3,187
General and administrative 24,841 18,761
--------------------------------

Earnings from operations 20,779 18,872

Other income (expenses)
Interest expense (769) (1,128)
Other income 449 197
--------------------------------

Earnings before income taxes 20,459 17,941

Income taxes (1) 9,124 5,524
--------------------------------

Net earnings (1) $ 11,335 $ 12,417
--------------------------------
--------------------------------

Net earnings per share $ 0.34 $ 0.37
Net earnings per share - diluted $ 0.33 $ 0.36

Weighted average shares outstanding 34,248,778 33,962,859
Diluted weighted average shares
outstanding 34,576,300 33,326,796

Net earnings in accordance with GAAP $ 11,335 $ 12,417
Adjustment relating to non-recurring
income taxes (1) 1,218 -
--------------------------------
Adjusted net earnings $ 12,553 $ 12,417
--------------------------------
--------------------------------

Adjusted net earnings per share $ 0.37 $ 0.37
Adjusted net earnings per share - diluted $ 0.36 $ 0.36

(1) Income taxes for the quarter ended December 31, 2004 include a
charge of $1,218 relating to the realization of foreign exchange
gains recorded at the subsidiary level in connection with term
debt that came due in the second half of 2004. The Company does
not expect to incur a similar charge in subsequent periods.
Excluding this charge, income taxes for the quarter ended
December 31, 2004 would have been $7,906.


Selected Balance Sheet Data (USD thousands)

December 31, 2004 December 31, 2003
--------------------------------------------

Working capital $ 36,871 $ 35,700
Total assets 442,409 413,362
Long-term debt 10,792 27,350
Total shareholders' equity 289,264 252,779

Selected Operating Data (unaudited)

Auction revenues as percentage of
gross auction sales (12 mos) 10.19% 10.36%
Number of consignors (12 mos) 24,868 23,480
Number of bidders (12 mos) 202,571 181,039
Number of buyers (12 mos) 58,858 55,946
Number of permanent auction sites 22 22
Number of regional auction units 7 7


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Ritchie Bros. Auctioneers Incorporated
    Jeremy Black
    Senior Manager - Finance
    (604) 273-7564
    (604) 273-2405 (FAX)
    ir@rbauction.com
    www.rbauction.com