Ritchie Bros. Auctioneers Announces First Quarter 2013 Results

Ritchie Bros. Auctioneers Incorporated (NYSE: RBA) and (TSX: RBA), a global seller of used equipment and trucks, announces net earnings and adjusted earnings for the three months ended March 31, 2013 of $14.0 million, or $0.13 per diluted share. This compares to net earnings and adjusted earnings of $18.0 million, or $0.17 per diluted share, for the three months ended March 31, 2012, representing a 22% decrease in net earnings and adjusted net earnings. The company's auction revenues during the first quarter of 2013 grew 1% to $102.1 million compared to $101.3 million for the same period in 2012.

The company also announced on April 26, 2013, the declaration of a quarterly dividend of $0.1225 per common share payable on June 7, 2013, to shareholders of record on May 17, 2013.

Gross Auction Proceeds and Auction Revenues

During the first quarter of 2013, the company conducted 36 unreserved industrial auctions in 12 countries throughout North America, Europe, the Middle East, Australia and Africa.

For the three months ended March 31, 2013, gross auction proceeds were $845.4 million which is 2% lower than the same period in 2012 and includes $18.7 million of volume from AssetNation/Equipment One. The company's auction revenue rate (auction revenues as a percentage of gross auction proceeds) was 12.07% during the period ended March 31, 2013 compared to 11.71% in the same period of 2012. The company's at risk business, which is comprised of guarantee and purchase contracts, represented 20% of gross auction proceeds in the first three months of 2013 (2012: 29%).

Online Growth

The Ritchie Bros. website (rbauction.com) attracted approximately 1.7 million unique visitors in the first quarter of 2013, a 31% increase compared to the same period in 2012.

Ritchie Bros. sold over $289 million of equipment, trucks and other assets to online buyers during the first quarter of 2013, representing a 5% increase compared to the same period in 2012. Internet bidders continued to comprise over 50% of the total bidder registrations at Ritchie Bros. industrial auctions in the first quarter of 2013.

Video: Bidding Online During a Ritchie Bros. Equipment Auction

As previously announced on April 8, 2013, the company initiated the commercial launch of its online equipment marketplace, called Richie Bros. EquipmentOne (EquipmentOne.com). Complementary to the company's flagship unreserved auction business, Ritchie Bros. EquipmentOne is a secure online marketplace for equipment and materials. Buyers and sellers can use Ritchie Bros. EquipmentOne to negotiate, complete and settle their transactions in a safe and transparent environment.

Summary Comments

"We have started the year with a strong auction revenue rate; however, this did not totally compensate for the fall in our gross auction proceeds. There are a couple of key points in regards to our efforts to grow our GAP," said Peter Blake, Ritchie Bros. CEO. "Our gross auction proceeds growth has been impacted by our territory manager productivity and the OEM production decrease and its impact on the mix of equipment we sell at our auctions.

"We have hired a record number of territory managers during the past year and are focused on coaching them to sell auction services and getting them as productive as quickly as possible," he continued. "There was a significant OEM production decrease during the recession, and as a result the average age of items sold at our auctions over the past year is older and this has had a negative impact on the average value of what we are selling, effecting our gross auction proceeds. We see the rise in construction and transportation OEM production since 2010 as encouraging. In the near term, we remain confident we are on track to deliver and execute as planned for 2013."

He added, "So far in the second quarter we have continued our investment in Ritchie Bros. EquipmentOne and are excited to have initiated the commercial launch which is a significant part of our 2013 strategy. We are encouraged by our customer's initial response to this initiative. In addition, we are proud to have held our first auction in China which was well received by equipment owners."

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