Revenue for the quarter was $81.0 million, up $16.3 million from the prior year second quarter. Revenue for the first six months of 2016 was $117.3 million, down $7.5 million from 2015. Weak commodity prices continue to contribute to reduce sales levels for the Company. Sales in North America have declined from the prior years, particularly in the US. Sales to Eastern Europe have increased significantly, especially in the second quarter.
|2nd quarter ending March 31, 2016||Year ago|
|Net profit (millions)||$1.5||$0.4|
|Net profit / share||$0.05||$0.02|
|Shares issued (millions)||25.0||25.0|
Net earnings of $1.5 were up from earnings of $0.4 for the second quarter of 2015. For the year to date, net earnings were ($7.2), down from $1.9 in the prior year. Contributing to the increased earnings for the quarter was a $4.3 gain on sale of intellectual property and tooling from an obsolete product line offset by decreased margin and a recovery of income taxes relating to prior years that did not repeat in the current year.
Sales for the remaining part of the year are expected to be in line with first and second quarter sales. Sales and profitability for the year are projected to be lower as demand for agricultural equipment continues to be off in 2016 as a result of lower commodity prices. Dealer inventory in Canada and the United States for four wheel drives has dropped to its lowest point in the last few years. Company inventory levels have also been dropping to reflect the reduced demand and will continue to drop in 2016 increasing cash flow. Gross margin and operating margin continue to be weak due to 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.