TORONTO, ONTARIO--(Marketwired - July 28, 2014) - Toromont Industries Ltd. (TSX:TIH) reported its financial results for the second quarter ended June 30, 2014.
| Three months ended June 30 | Six months ended June 30 | ||||||||||||||||
| millions, except per share amounts | 2014 | 2013 | % change | 2014 | 2013 | % change | |||||||||||
| Revenues | $ | 415.6 | $ | 374.7 | 11 | % | $ | 727.3 | $ | 687.9 | 6 | % | |||||
| Operating income | $ | 39.9 | $ | 38.7 | 3 | % | $ | 66.5 | $ | 64.1 | 4 | % | |||||
| Net earnings | $ | 28.9 | $ | 27.3 | 6 | % | $ | 47.5 | $ | 45.1 | 5 | % | |||||
| Earnings per share - basic | $ | 0.37 | $ | 0.36 | 3 | % | $ | 0.62 | $ | 0.59 | 5 | % | |||||
"The Company delivered good results for the second quarter and first half of 2014," said Scott J. Medhurst, President and Chief Executive Officer of Toromont Industries Ltd. "After a relatively slow start to the construction season, due to weather, activity within the Equipment Group improved in the second quarter. CIMCO product support growth for the quarter and year-to-date surpassed previous records."
Highlights:
- Equipment Group revenues increased 16% to $369 million in the second quarter on strong equipment sales, product support and rentals. Equipment sales were 21% higher than 2013 principally on new and used mining equipment sales combined with stronger new unit construction deliveries. Rentals and product support revenues were both up 11%, driven by stronger parts sales. Operating income increased 13% compared to last year, mainly on the increased revenues and modest improvement in expense management.
- Equipment Group revenues were up 8% to $632 million year-to-date on increased equipment sales, product support and rentals. Equipment sales were 7% higher than 2013. Rentals were up 9% to $91 million while product support revenues were up 10% to $221 million.
- Equipment Group backlogs were $185 million at June 30, 2014, up from $97 million at December 31, 2013 and $173 million at this time last year, with construction and power systems being the key drivers. Substantially all of the order backlog is expected to be delivered in the latter half of this year. Bookings increased 31% in the quarter to $253 million and 19% to $402 million year-to-date.
- CIMCO revenues were down $11 million for the quarter and $9 million year-to-date versus the records set last year. Package sales revenues decreased across both industrial and recreational market segments on decreased activity levels in certain markets. Product support revenues of $24 million in the quarter and $45 million year-to-date were new records for their respective periods, with increases in both Canada and the US.
- CIMCO bookings in the quarter and year-to-date were lower than a year ago on reduced activity levels in certain markets. Backlogs of $72 million at June 30, 2014 were up from $65 million at December 31, 2013 and down from $104 million at June 30, 2013.
- Earnings increased 6% in the quarter and 5% year-to-date versus the corresponding periods of 2013, reflecting improved sales and product support activity levels.
- Earnings per share increased $0.01 to $0.37 in the quarter and $0.03 to $0.62 year-to-date.
- The Company is in a strong financial position. Total debt, net of cash, to total capitalization was 15%, well within stated capital targets.
- The Board of Directors announced the regular quarterly dividend of 15 cents per outstanding common shares, payable October 1, 2014 to shareholders of record on September 11, 2014. The regular quarterly dividend was previously increased 15% to 15 cents per share effective with the dividend paid April 1, 2014.
- Toromont was successful in securing a large equipment order to support the Keeyask hydroelectric project in northern Manitoba. The order includes trucks and small-to-large auxiliary equipment totalling $55 million. $14 million of this was delivered in the quarter, with the balance expected to deliver in the latter half of this year.
"In the Equipment Group, a tight pricing environment exacerbated by a weakened Canadian dollar, is expected to continue to pressure gross margins. Continued growth in product support bodes well for future results, as does the expected investment in larger construction projects, as exemplified by Keeyask. We also expect continued growth to come from our investment in the rental business and broader product offerings," continued Mr. Medhurst. "At CIMCO, reduced booking activity in eastern Canada and the US has somewhat dampened the outlook for the year, although product support growth continues to be encouraging."
Quarterly Results Materials
The complete second quarter report for 2014, including MD&A and unaudited interim condensed consolidated financial statements, is available on our website at www.toromont.com.
Quarterly Conference Call and Webcast
Interested parties are invited to join the quarterly conference call with investment analysts, in listen-only mode, on Tuesday, July 29, 2014 at 8:00 a.m. (ET). The call may be accessed by telephone at 1-800-766-6630 (toll free) or 416-340-8527 (Toronto area). A replay of the conference call will be available until Tuesday, August 12, 2014 by calling 1-800-408-3053 or 905-694-9451 and quoting passcode 3968980.
Both the live webcast and the replay of the quarterly conference call can be accessed at www.toromont.com.
Advisory
Information in this press release that is not a historical fact is "forward-looking information". Words such as "plans", "intends", "outlook", "expects", "anticipates", "estimates", "believes", "likely", "should", "could", "will", "may" and similar expressions are intended to identify statements containing forward-looking information. Forward-looking information in this press release is based on current objectives, strategies, expectations and assumptions which management considers appropriate and reasonable at the time including, but not limited to, general economic and industry growth rates, commodity prices, currency exchange and interest rates, competitive intensity and shareholder and regulatory approvals.
By its nature, forward-looking information is subject to risks and uncertainties which may be beyond the ability of Toromont to control or predict. The actual results, performance or achievements of Toromont could differ materially from those expressed or implied by forward-looking information. Factors that could cause actual results, performance, achievements or events to differ from current expectations include, among others, risks and uncertainties related to: business cycles, including general economic conditions in the countries in which Toromont operates; commodity price changes, including changes in the price of precious and base metals; changes in foreign exchange rates, including the Cdn$/US$ exchange rate; the termination of distribution or original equipment manufacturer agreements; equipment product acceptance and availability of supply; increased competition; credit of third parties; additional costs associated with warranties and maintenance contracts; changes in interest rates; the availability of financing; and, environmental regulation.
Any of the above mentioned risks and uncertainties could cause or contribute to actual results that are materially different from those expressed or implied in the forward-looking information and statements included in this press release. For a further description of certain risks and uncertainties and other factors that could cause or contribute to actual results that are materially different, see the risks and uncertainties set out in the "Risks and Risk Management" and "Outlook" sections of Toromont's most recent annual or interim Management Discussion and Analysis, as filed with Canadian securities regulators at www.sedar.com and may also be found at www.toromont.com. Other factors, risks and uncertainties not presently known to Toromont or that Toromont currently believes are not material could also cause actual results or events to differ materially from those expressed or implied by statements containing forward-looking information.
Readers are cautioned not to place undue reliance on statements containing forward-looking information that are included in this press release, which are made as of the date of this press release, and not to use such information for anything other than their intended purpose. Toromont disclaims any obligation or intention to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities legislation.
About Toromont
Toromont Industries Ltd. operates through two business segments: The Equipment Group and CIMCO. The Equipment Group includes one of the larger Caterpillar dealerships by revenue and geographic territory in addition to industry leading rental operations. CIMCO is a market leader in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems. Both segments offer comprehensive product support capabilities. This press release and more information about Toromont Industries can be found at www.toromont.com.
| TOROMONT INDUSTRIES LTD. | |||||||||||||
| INTERIM CONDENSED CONSOLIDATED INCOME STATEMENTS | |||||||||||||
| (Unaudited) | |||||||||||||
| Three months ended June 30 | Six months ended June 30 | ||||||||||||
| ($ thousands, except share amounts) | 2014 | 2013 | 2014 | 2013 | |||||||||
| Revenues | $ | 415,559 | $ | 374,738 | $ | 727,307 | $ | 687,870 | |||||
| Cost of goods sold | 320,225 | 283,321 | 554,264 | 520,534 | |||||||||
| Gross profit | 95,334 | 91,417 | 173,043 | 167,336 | |||||||||
| Selling and administrative expenses | 55,415 | 52,710 | 106,564 | 103,278 | |||||||||
| Operating income | 39,919 | 38,707 | 66,479 | 64,058 | |||||||||
| Interest expense | 2,072 | 2,175 | 4,157 | 4,277 | |||||||||
| Interest and investment income | (896 | ) | (1,068 | ) | (1,962 | ) | (2,260 | ) | |||||
| Income before income taxes | 38,743 | 37,600 | 64,284 | 62,041 | |||||||||
| Income taxes | 9,884 | 10,316 | 16,796 | 16,909 | |||||||||
| Net earnings | $ | 28,859 | $ | 27,284 | $ | 47,488 | $ | 45,132 | |||||
| Earnings per share | |||||||||||||
| Basic | $ | 0.37 | $ | 0.36 | $ | 0.62 | $ | 0.59 | |||||
| Diluted | $ | 0.37 | $ | 0.35 | $ | 0.61 | $ | 0.59 | |||||
| Weighted average number of shares outstanding | |||||||||||||
| Basic | 77,031,951 | 76,588,810 | 76,963,879 | 76,542,490 | |||||||||
| Diluted | 77,716,339 | 77,159,097 | 77,625,112 | 77,117,747 | |||||||||
Contact Information:
Paul R. Jewer
Executive Vice President and Chief Financial Officer
(416) 667-5638
www.toromont.com