WINNIPEG, Manitoba — Buhler Industries, manufacturer of Versatile and Farm King branded equipment, reported its third quarter 2017 earnings on Aug. 14.
Revenue for the quarter was $91.4 million, up $4.3 million from the prior year third quarter. Revenue for the first 9 months of 2017 was $218 million, up $13.6 million from the same period of 2016. Weak commodity prices continue to contribute to reduced sales levels for the company. Orders in North America have returned to near historical levels, with the company seeing an increase in sales to the U.S. Sales to Eastern Europe have remained steady.
Net earnings of $2.6 million were down from earnings of $3.1 million for the third quarter of 2016. For the year to date, net earnings were ($0.1) million, an improvement of $4 million from the prior year. Contributing to the decreased earnings for the quarter was a $2.4 million gain on sale of surplus property in the prior year, offset by the current quarter’s improved margin. For the year to date, the increase is principally due to the improved margin, offset by increased gains on sale of surplus property in the prior year.
Sales for 2017 are expected to be up over 2016 sales. While demand for agricultural equipment continues to be slow resulting from lower commodity prices, the company has experienced higher levels of demand for equipment in 2017 compared to 2016. Dealer inventory levels for front-wheel assist and 4WD tractors are down from last year in both Canada and the U.S., which will create opportunities when demand for new equipment increases. Subsequent to quarter end, the company finalized a 3 year asset-based lending agreement with CIBC, which will provide the company with a $50 million credit line and help reduce interest costs going forward. Profit margins are still expected to be soft due to competition for equipment sales and the weaker Canadian dollar that continues to have a significant negative impact on the company with parts purchased in U.S. dollars.