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Ritchie Bros. Reports Strong Results for Third Quarter

Wed November 16, 2005 - National Edition
CEG



Ritchie Bros. Auctioneers Incorporated has announced its results for the three and nine months ended Sept. 30, 2005. The company’s net earnings for the nine months /were $39.4 million, or $1.13 per diluted weighted average share, compared to $23.6 million, or $0.68 per diluted weighted average share, in the corresponding period in 2004.

Net earnings for the first nine months of 2005 included gains of $6.4 million ($4.1 million, or $0.11 per diluted share, after tax) recorded on the sale of property that was not being used in the company’s operations. Excluding these gains, which the company does not consider part of its normal operations, net earnings for the nine months ended Sept. 30, 2005, would have been $35.3 million, or $1.02 per diluted weighted average share.

Gross auction sales for the first nine months of 2005 were $1.50 billion, 21 percent higher than the gross auction sales reported for the comparable period in 2004. Strong sales volumes in the United States and Canada contributed to the gross auction sales growth. Auction revenues for the nine months ended Sept. 30, 2005, were $152.7 million, a 22 percent increase over the comparable period in 2004.

Auction revenues as a percentage of gross auction sales were 10.16 percent for the first three quarters of this year compared to a rate of 10.09 percent in the equivalent period last year.

Ritchie Bros. sold more than 144,000 lots for more than 20,000 consignors at 104 industrial auctions attracting approximately 151,000 registered bidders during the first nine months of 2005. This compares to 123,000 lots for more than 17,000 consignors at 100 industrial auctions that attracted approximately 143,000 registered bidders during the first nine months of 2004.

The Company also held 84 agricultural auctions during the period (2004 — 79 agricultural auctions), which generated gross auction sales of approximately $65 million (2004 - $35 million).

Gross auction sales for the quarter ended Sept. 30, 2005 were $364 million. Auction revenues for the third quarter of 2005 were $38.4 million and the auction revenue rate was 10.56 percent.

During the quarter ended Sept. 30, 2005, the company completed the acquisition of an approximately 160-acre property in Denver, CO, on which it intends to construct a new permanent auction site to replace its existing permanent site in Denver. The company also acquired approximately 62 acres of land in Saskatoon, Saskatchewan, and intends to develop the property by constructing a modest auction facility intended primarily for agricultural auctions.

Peter J. Blake, the company’s CEO, remarked, “Our results to date in 2005 continue to support our long-held belief that our unreserved auctions are the most effective way to match local supply with global demand, thereby creating a global marketplace for industrial assets.

“The strength of the economies in most of the markets in which we operate is causing a tightness in the supply of equipment; however, our strong sales results seem to suggest that the people who are selling equipment are choosing Ritchie Bros. unreserved auctions in ever-increasing numbers.”

Bidders using the company’s rbauctionBid-Live internet bidding service during the nine months ended Sept. 30, 2005 purchased more than $200 million worth of trucks and equipment, a 50 percent increase over the equivalent period in 2004. While the majority of bidders still prefer to attend the auctions in person, the rbauctionBid-Live service complements the company’s live auctions by increasing the size and diversity of the bidding audiences.

The board of directors has announced the declaration of a quarterly cash dividend of $0.18 per common share payable on Dec. 16, 2005 to shareholders of record on Nov. 25, 2005. The board also announced that Charles E. Croft has been elected vice-chairman of the board of directors, effective immediately. Croft has been a director of the company since 1998.

Gross auction sales represent the aggregate selling prices of all items sold by the company during the period 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.

For more information, please visit www.rbauction.com.