Toromont Industries (TIH) Q2 2025 earnings summary

Executive summary

• Q2 2025 revenue increased 1% year-over-year, supported by AVL and CIMCO growth, while net earnings declined 8% due to higher expenses, lower interest income, and non-cash AVL acquisition costs.

• Bookings rose 14% in Q2 and 1% YTD, with backlog reaching $1.4 billion, reflecting strong order activity and acquisition impact.

• Financial position remains strong with $1 billion in cash, $456 million in available credit, and continued focus on disciplined execution.

• AVL acquisition ramped up production, contributed to revenue, and reduced EPS by CAD 0.04 YTD due to non-cash purchase price accounting items.

• CIMCO posted higher revenue and earnings, driven by strong demand and execution in both Canada and the U.S., with a robust order backlog.

Financial highlights

• Q2 consolidated revenue: $1,376.5 million (+1% year-over-year); YTD revenue: $2,466.1 million (+4%).

• Q2 net earnings: $124.3 million (-8% year-over-year); YTD net earnings: $198.8 million (-9%); basic EPS was $1.53 for Q2 and $2.45 YTD.

• Q2 operating income: $170.7 million (-4%); YTD operating income: $269.2 million (-5%).

• Rental revenue up 15% in Q2 and 13% YTD; product support up 4% in Q2 and 1% YTD; new equipment sales down 5% in Q2 but up 3% YTD.

• Expenses increased 11% in Q2, with AVL acquisition adding $12.9 million; excluding AVL, expenses rose 3% year-over-year.

Outlook and guidance

• Economic environment remains uncertain, shaped by trade negotiations, FX volatility, inflation, and interest rates.

• Healthy backlog and well-positioned supply chain to meet customer needs; continued investment in technician workforce.

• No formal guidance provided, but AVL backlog of $246.4 million offers visibility into future production.

• Management focused on cost control, balance sheet strength, and long-term growth.