Ritchie Bros swims against economic tide

However, the auctioneer sold fewer lots over the year (253,000 in 2008 compared to 261,000 in 2007).In 2008, Ritchie Bros. conducted 193 unreserved industrial auctions and 147 unreserved agricultural auctions in 13 countries throughout North America, Europe, the Middle East and Asia as well as Australia.The company said it planned to release full audited financial statements and management’s discussion and analysis for 2008 on February 26.”We are very pleased with our 12% gross auction proceeds growth in 2008,” said chief executive Peter Blake.”When economies around the world took a sudden and dramatic downturn at the start of our fourth quarter, some of our customers decided to delay selling their idle or surplus equipment until the market found its level.“We’ve seen more pricing stability at our auctions in recent weeks, which gives comfort to potential consignors and bodes well for 2009.”But Blake said demand for Ritchie Bros’ services was probably highest in periods of economic turbulence.“Unlike most other sales channels, our unreserved auctions provide almost instant liquidity and global fair market value for equipment sellers,” he said. “When demand is volatile and unpredictable, sellers need access to the widest possible array of bidders.”We faced unusual currency headwinds during the last quarter of 2008 that negatively impacted our reported fourth quarter gross auction proceeds by about US$55 million. “The Canadian dollar, euro and Australian dollar all experienced significant erosion compared to the US dollar during the period. We continued to see strong gross auction proceeds growth in Canada, Europe and Australia, where we conduct auctions in non-US currencies.”However, because the company reported its consolidated results in US dollars, some of the growth was muted when non-US dollar amounts were converted from the local currencies.“Mitigating that effect is the fact that roughly 60% of our operating costs on an annual basis are in non-US currencies, meaning our consolidated operating costs reported in US dollars benefited from these currency fluctuations,” he said.

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