Ritchie Bros. Auctioneers Incorporated, the world’s largest industrial auctioneer, announces net earnings for the quarter ended September 30, 2013 of $16.4 million, or $0.15 per diluted share. This compares to net earnings of $8.2 million, or $0.08 per diluted share for the quarter ended September 30, 2012, representing a 101% increase in net earnings.
The company generated adjusted net earnings of $16 million, or $0.15 per diluted share in the third quarter of 2013. This compares to adjusted net earnings of $9.7 million, or $0.09 per diluted share in the same quarter last year, representing a 65% increase. Adjusted net earnings, a non-GAAP measure, excludes the after-tax effects of excess property sales and other non-recurring items.
The company’s auction revenues for the third quarter of 2013 grew 15 percent to $105.8 million compared to $92.3 million for the same period in 2012. For the nine months ended September 30, 2013 net earnings were $60.5 million, or $0.57 per diluted share, and adjusted net earnings were $60.1 million, or $0.56 per diluted share. This compares to net earnings of $57.4 million, or $0.54 per diluted share, and adjusted net earnings of $60.2 million, or $0.56 per diluted share, for the nine months ended September 30, 2012. This represents a 1 percent decrease in adjusted net earnings. The company’s auction revenues during the nine months ended September 30, 2013 grew 5 percent to $336.2 million compared to $320.8 million for the same period in 2012.
During the third quarter of 2013, the company conducted 58 unreserved industrial auctions in 15 countries throughout North America, Central America, Europe, the Middle East, Asia and Australia. “The strong performance of our underwritten business helped to bolster our Auction Revenue Rate to its highest level ever, driving meaningful revenue and earnings growth this quarter," said Peter Blake, CEO of Ritchie Bros. Auctioneers.
Adjusted net earnings for Ritchie Bros. fiscal third quarter of 2013 does not include a deduction for $2.3 million of pre-tax expenses related to cost alignment initiatives implemented during the quarter.
The company also announces the declaration of a quarterly cash dividend of $0.13 per common share payable on December 13, 2013 to shareholders of record as of November 22, 2013.
Gross Auction Proceeds were $789.6 million during the third quarter of 2013, a 7 percent decrease compared to the same period in 2012. This decline was due primarily to the timing of auctions and a large one-time consignment that occurred in the comparable period last year. EquipmentOne and other online marketplaces contributed $20.1 million to Gross Auction Proceeds in the third quarter of 2013 compared to $20.5 million in the same period of 2012. Gross Auction Proceeds is a non-GAAP financial measure and is defined below.
For the nine months ended September 30, 2013, Gross Auction Proceeds was $2.7 billion, which is 7 percent lower than in the same period of 2012. EquipmentOne and other online marketplaces contributed $65.6 million to Gross Auction Proceeds in the nine months ended September 30, 2013 compared to $37.4 million in the same period of 2012. The company’s Auction Revenue Rate (“ARR”, or auction revenues as a percentage of Gross Auction Proceeds) during the third quarter of 2013 was 13.40 percent, significantly higher than the 10.88 percent ARR achieved in the same period in 2012. The company’s ARR was 12.41 percent during the nine months ended September 30, 2013, compared to 11.03 percent in the same period in 2012. Revenue growth in both the three-and nine months ended September 30, 2013 was primarily due to an increased ARR. The improvement in ARR is consistent with our strategic focus on managing the performance of our ‘at risk’ (or underwritten) business. The company’s ‘at risk’ business, which is comprised of guarantee and purchase contracts, represented 29 percent of Gross Auction Proceeds in the third quarter 2013 as compared to 34 percent in the third quarter 2012. The ‘at risk’ business represented 26 percent of Gross Auction Proceeds for the nine months ended September 30, 2013, as compared to 33 percent in the same period of 2012.
Online bidding statistics Ritchie Bros. sold over $987 million of equipment, trucks and other assets to online buyers during the first nine months of 2013, representing 36 percent of Gross Auction Proceeds. Internet bidders continued to comprise over 50 percent of the total bidder registrations at Ritchie Bros. industrial auctions in the third quarter of 2013. The Ritchie Bros. website in the nine months ended September 30, 2013, a 15 percent increase compared to the same period in 2012.
There are currently 55 unreserved auctions on the 2013 Ritchie Bros. auction calendar, including auctions in North America, Central America, Europe and Australia.
