Caterpillar dealer Finning International says South America was weak spot in Q1

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VANCOUVER – Finning International Inc. (TSX:FTT) estimates that its first-quarter revenue will be about $1.676 billion, an increase of eight per cent from the comparable period last year.

The Vancouver-based company, which is one of the world’s largest distributors of Caterpillar heavy equipment, said its Canadian and European revenue was up, but its South American operations experienced a currency-related decline.

Finning had indicated during a earnings call on Feb. 19 that its first-quarter results would be affected by a devaluation of the Argentine peso and its Canadian results would feel some impact from a weakening of the Canadian dollar.

It said Friday that Canadian revenue from the three months ended March 31 was about $891 million, up 18 per cent from the first quarter of 2013.

Revenue also grew in the relatively small European arm covering the United Kingdom and Ireland, rising 23 per cent to $236 million — although the year-over-year growth was only five per cent in local currency.

Finning’s South American operations, the company’s second-largest source of revenue, experienced a 10 per cent decline from a year earlier with revenue dropping to $550 million.

The preliminary financial report was issued a month before Finning is scheduled to release full results and hold its annual shareholder meeting on May 13.

Finning shares slipped about three per cent from Thursday’s close after the company’s statement. The stock traded as low as $27.90 in early trading Friday, but remained up from a year ago, when the stock closed on April 11, 2013, at $24.15.

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