• Heavy Equipment Auctions Booming
IronPlanet, Inc., a full-service online marketplace for used heavy equipment, saw its highest online auction sale price to date for a piece of used equipment in its May 3rd auction -- $165,000 for a 2000 Caterpillar D6R Dozer located in North Carolina and sold to a buyer in Alberta, Canada. The 25 pieces listed in this auction sold for a combined total over $1.2 million.IronPlanet has sold over $4.8 million worth of used equipment through online auctions to date in 2001, and over $10 million since the company's first auction in April, 2000. Over its last three auctions, IronPlanet sold all 83 pieces listed to the highest bidder.
Ritchie Bros. Auctioneers meanwhile, released its first quarter financial results During the first three months of 2001, Ritchie Bros. sold over 26,000 lots for over 3,600 consignors at 21 auctions attended by over 26,000 bidders from over 80 countries.
Gross auction sales were $289.7 million for the three months ended March 31, 2001, generating auction revenues of $25.4 million, compared to gross auction sales of $289.9 million and auction revenues of $26.8 million for the comparable period in 2000. David E. Ritchie, Chairman and CEO of the company stated, "Sales in the first quarter last year were unusually strong and, at the time, we made it clear that we didn’t expect to achieve a similar level in 2001. But the current economic climate is proving to be very favorable."
Net income after tax for the first three months of 2001 was $3.1 million, or $0.18 per diluted weighted average share, compared to $3.6 million, or $0.21 per diluted share, in the first quarter of 2000.
As a percentage of gross auction sales, auction revenues during the first quarter of 2001 were 8.78%, in line with RBA’s long-term average rate of 8.80% but lower than the unusually high rate of 9.23% experienced during the first quarter of 2000.
Commenting on used equipment market conditions, Mr. Ritchie added: "It appears to us that equipment markets have begun to loosen, no doubt due in part to the current US economic environment. Consistent with our experience in prior economic cycles, this increased supply of equipment to our auctions is being met by increased demand with the result that prices have been remarkably stable across most categories of used equipment. The strong demand comes from contractors who turn to our auctions to fill their equipment needs because they no longer have the confidence to buy more expensive new equipment from traditional sources. It also comes from our ability to transcend local market conditions – over 50% of the trucks and equipment sold at our auctions goes to buyers from outside the region where the auction is held."
