Revenue for the quarter was $36.3 million, down from $60.1 million in the first quarter of 2015. Weak commodity prices continue to contribute to reduced sales levels. Sales in North America have declined from the prior years, particularly in the US. Sales to Eastern Europe have increased significantly.
|1st quarter ending December 31, 2015||Year ago|
|Net profit (millions)||($8.7)||$1.5|
|Net profit / share||($0.35)||$0.06|
|Shares issued (millions)||25.0||25.0|
The net loss for the quarter was ($8.7), compared with last year’s first quarter income of $1.5, mainly driven by the decreased margin and a recovery of income taxes relating to prior years that did not repeat in the current year. Partially offsetting these was a $0.7 reduction in selling and administration expenses.
Sales for the second and third quarter are expected to be higher than first quarter sales. Sales and profitability for the year are still expected to be off 2015 levels as demand for agricultural equipment continues to be weaker in 2016 as a result of lower commodity prices. Inventory levels are expected to drop in 2016 boosting cash flow. Gross margin and operating margin are expected to be lower due reduced production efficiencies created by lower sales. In addition, increased competition for equipment sales will lead to lower margins due to additional sales programs being added. Finally, the weaker Canadian dollar continues to have a significant negative impact on the Company with parts purchased in US dollars with the majority of sales projected to be done in Canada during the year.