Rocky Mountain Dealerships, Canada’s largest Case IH dealer, has reported its financial results for the three months ended Sept. 30, 2020. Unless otherwise stated, all amounts are expressed in Canadian dollars.

“The agriculture industry is an annual cycle of plant, grow and harvest. We now have that full cycle under our belt since we implemented aggressive cost and inventory reduction initiatives in the last half of 2019,” stated Mr. Garrett Ganden, president and CEO. “RME’s solid third quarter performance is the result of the consistent execution of our strategy to reduce equipment inventory and realign our cost structure through a period of unprecedented and challenging industry conditions."

Summary of the Third Quarter 2020

  • $134.8 million decrease in equipment inventory year-over-year as a result of continued focus in this area. In 2020 year-to-date, equipment inventory has been reduced by $154.5 million.
  • $16.9 million (9.2%) increase in sales in the quarter to $201 million compared with the third quarter of 2019, due to higher sales in all categories.
  • Gross profit as a percent of sales increased to 15.3% from 14.8% in the same period in 2019 due primarily to stronger used equipment and parts and service margins.

Third quarter total sales increased by $16,927, or 9.2%, to $200,994 from $184,067 during the same period in 2019, due to higher sales in all categories. The significant 10.2% increase in used equipment sales was a direct result of our continued focus on used equipment sales and reducing used equipment inventory.

Year-to-date 2020 total sales decreased by $7,768 or 1.4% to $548,554 from $556,322 during the same period in 2019 due to aggressive marketing of our used equipment inventory and continued prudence on new equipment sales volumes.

Third quarter 2020 parts and service (collectively, "Product Support") revenues increased by 11.4% or $5,648 to $55,152 compared with $49,504 in the same period of 2019. The increase was driven by continued aftermarket initiatives and a favorable harvest through most of our sales territories.

Year-to-date 2020 Product Support revenues increased by 7.5% or $9,038 to $128,838 compared with $119,800 in the same period of 2019, due to strength in our aftermarket sales initiatives and a favorable harvest.

Third 2020 gross profit increased by $3,577, or 13.2%, to $30,771 compared with $27,194 for the same period in 2019 due to improved sales volumes and margins. As a percent of sales, gross profit increased to 15.3% compared with 14.8% during the same period of 2019.

Year-to-date 2020 gross profit decreased by $3,734 or 4.6% to $78,157 compared with $81,891 for the same period in 2019. The decline in gross profit is a function of reduced overall sales levels, compressed margins and a decline in OEM incentives, partially offset by a favorable shift in sales mix towards higher margin Product Support revenues. As a percent of sales, gross profit decreased to 14.2% compared with 14.7% during the same period of 2019.