VANCOUVER, BC (May 3, 2011) Ritchie Bros. Auctioneers Inc. (NYSE and TSX: RBA) reported auction revenues for the three months ended March 31, 2011 were $88.5 million, a 6% increase compared to $83.5 million for the same period in 2010. The company conducted 37 industrial auctions in 11 countries throughout North America, Europe, the Middle East, Central America and Australia during the first quarter of 2011.
The company announced a quarterly cash dividend of $0.105 per common share payable on June 10, 2011 to shareholders of record on May 20, 2011.
Gross auction proceeds for the first quarter were $851 million, 10% higher than in the same period in 2010. Excluding gross auction proceeds of $47 million from the sale of the megayacht Apoise in the first quarter of 2010, the increase would have been 17%. Gross auction proceeds is a non-GAAP financial measure and is described below. The company's auction revenue rate (auction revenues as a percentage of gross auction proceeds) was 10.39% during the first three months of 2011, compared to 10.76% in the first three months of 2010.
Ritchie Bros. sold over $223 million of equipment, trucks and other assets to online bidders during the first quarter of 2011, representing a 19% increase compared to the same period in 2010 (2010 –$187 million). Internet bidders comprised approximately 46% of the total bidder registrations at Ritchie Bros. industrial auctions in the first quarter of 2011. Since launching its real-time online bidding service in 2002, the company has now sold almost $4.4 billion worth of trucks, equipment, and other assets to online bidders confirming Ritchie Bros.' position as the world's largest seller of used equipment and trucks to online buyers.
Ritchie Bros. has just celebrated the first anniversary of its new multi-language rbauction.com website. The company experienced a 29% increase in visits to its website from non-English speakers and they made up 20% of the visits during the three months ended March 31, 2011.
There was a 29% increase in the number of unique visitors to rbauction.com for the three months ended March 31, 2011 compared to the same period in 2010. Roughly 1.0 million unique visitors made 10.7 million equipment searches during the quarter ended March 31, 2011 compared to 0.8 million unique visitors and 7.9 million searches, respectively, in the same period in 2010.
"We are pleased to have achieved the largest first quarter gross auction proceeds and auction revenues in our history. Our strong performance reflected increasing optimism among equipment owners and early signs of momentum returning to the equipment industry," said Peter Blake, Ritchie Bros. CEO. "During the first quarter of 2011, we continued to see tight supply of late model used equipment and strong competition in the marketplace, and we were successful achieving strong prices across most categories of equipment. Our auction revenue rate returned to a more sustainable level during the quarter because the performance of our at-risk business was lower than the above trend performance in 2010. The proportion of our business that was at risk during the quarter increased in response to customer demand as we helped them achieve their sale objectives.
"We remain optimistic about our prospects for the balance of 2011 as the used equipment market around the world continues to return to a more balanced state," Blake continued. "Construction activity in a number of our markets around the world remains uncertain, and sustained improvement will be important for maintaining strength in the used equipment market over the longer term. However, our strategic initiatives are progressing well and we are looking forward to the implementation of a number of exciting new services on July 1, including our detailed equipment information and customer finance programs."
Ritchie Bros. defines adjusted net earnings as financial statement net earnings excluding the after-tax effects of excess property sales and significant foreign exchange gains or losses resulting from financing activities that are not expected to recur, and has provided a reconciliation below. Adjusted net earnings is a non-GAAP financial measure that does not have a standardized meaning, and is therefore unlikely to be comparable to similar measures presented by other companies. The company believes that comparing adjusted net earnings for different financial periods provides more useful information about the growth or decline of its net earnings for the relevant financial period and identifies the impact of items which the company does not consider to be part of its normal operating results.
Gross auction proceeds represent the total proceeds from all items sold at Ritchie Bros. auctions. The company's definition of gross auction proceeds may differ from those used by other participants in its industry. Gross auction proceeds is an important measure the company uses in comparing and assessing its operating performance. It is not a measure of the company's financial performance, liquidity or revenue and is not presented in its consolidated financial statements. The company believes that auction revenues, which is the most directly comparable measure in its Consolidated Income Statements, and certain other line items, are best understood by considering their relationship to gross auction proceeds. Auction revenues represent the revenues earned by Ritchie Bros. in the course of conducting its auctions, and consist primarily of commissions earned on consigned equipment and net profit on the sale of equipment purchased by the company and sold in the same manner as consigned equipment.
Established in 1958, Ritchie Bros. Auctioneers (NYSE and TSX: RBA) is the world's largest industrial auctioneer, selling more equipment to on-site and online bidders than any other company in the world. The company conducts hundreds of unreserved public auctions each year, selling a broad range of used and unused industrial assets, including equipment, trucks and other assets utilized in the construction, transportation, agricultural, material handling, mining, forestry, petroleum and marine industries. Ritchie Bros. has over 110 locations in more than 25 countries, including 43 auction sites worldwide. The company maintains a website at www.rbauction.com and sponsors an equipment wiki atwww.RitchieWiki.com.
