Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Finning International Inc T.FTT

Alternate Symbol(s):  FINGF

Finning International Inc. provides caterpillar equipment, parts, services, and performance solutions. The Company’s segments include Canada, South America, UK & Ireland, and Other. The Canadian operations sell, service, and rent mainly caterpillar equipment and engines in British Columbia, Alberta, Saskatchewan, the Yukon Territory, the Northwest Territories, and a portion of Nunavut, and also provide mobile on-site refueling services in provinces of Canada, as well as in Texas, US. The Canadian operations’ markets include mining, construction, conventional oil and gas, forestry, and power systems. The South American operations sell, service, and rent mainly Caterpillar equipment and engines in Chile, Argentina, and Bolivia. The UK & Ireland operations sell, service, and rent mainly Caterpillar equipment and engines in England, Scotland, Wales, Northern Ireland, and the Republic of Ireland. The UK & Ireland operations’ markets include construction, power systems, and quarrying.


TSX:FTT - Post by User

Post by retiredcfon Mar 23, 2022 7:49am
66 Views
Post# 34536862

TD

TDCurrently have a $46.00 target. GLTA

Finning International Inc.

(FTT-T) C$39.36

Hydraquip Purchase Adds to U.K. Product Support Capabilities Event

Finning announced the acquisition of Hydraquip Hose & Hydraulics Ltd. and Hoses Direct Ltd. (Hydraquip) for £65mm/$108mm (before deferred contingent consideration). The company will fund the deal from cash on hand and existing credit facilities (Q4/21 net debt was $1.2bln, including leases, or ~1.4x TTM adjusted EBITDA).

Impact: SLIGHTLY POSITIVE

  • The transaction is not very material in a consolidated sense, representing ~1-2% of Finning's 2021 adjusted EBITDA, but we have characterized it as SLIGHTLY POSITIVE, as it is aligned with the company's strategy of driving product support growth by providing complementary products and services that help customers maximize uptime and reduce operating costs, and it should be immediately accretive to the U.K./Ireland's EBIT margin percentage, as well as to Finning's consolidated EPS and FCF. The purchase price corresponds to a 9.0x EV/EBITDA multiple, which is relatively in line with Finning at 8.8x (both multiples calculated based on 2021 adjusted EBITDA).

  • Hydraquip is the second-largest hydraulic hose replacement and repair company in the U.K., with ~270 employees serving more than 4,000 customers across a diverse range of industries, including construction, power systems, transportation, waste management, utilities, manufacturing, and materials handling, many of which are also served by Finning's U.K./Ireland operations.

  • Hydraquip generates ~60% of its revenue from on-site mobile hose services, including hose replacement, assembly and fitting, oil replenishment, and general hydraulic servicing, with 130 mobile service vans and trained technicians providing 24/7 coverage across the U.K. The other 40% of revenue is derived from the sale of hydraulic and fluid power products and parts across a network of 27 branches and online. In 2021, Hydraquip generated revenue of more than £26mm and Adjusted EBITDA of £7.2mm (~27-28% EBITDA margin). Hydraquip was founded in 1989 by Duncan MacBain, its current managing director.


<< Previous
Bullboard Posts
Next >>