Finning International ((TSE:FTT)) has held its Q3 earnings call. Read on for the main highlights of the call.
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During the recent earnings call, Finning International expressed a generally optimistic sentiment, showcasing robust financial performance. The company reported significant revenue and EPS growth, alongside a strong order intake and an expanding Power Systems backlog. Despite facing challenges in maintaining product support margins and growth in certain regions like the U.K., the company’s strategic focus and effective cost management played a crucial role in delivering positive earnings.
Strong Revenue Growth
Finning International’s Q3 2025 revenue reached $2.8 billion, marking a 14% increase compared to Q3 2024. This growth was consistent across all regions, highlighting the company’s broad-based strength and market penetration.
Product Support Revenue Increase
Over the past 12 months, product support revenue climbed to $5.8 billion, with notable growth in Canada (7%), South America (6%), and the U.K. and Ireland (2%). This increase underscores the company’s successful expansion in its support services.
Power Systems Backlog Growth
The Power Systems backlog at the end of September 2025 was nearly $1 billion, up 23% from the previous year. This growth reflects a diverse mix of orders, indicating strong demand and future revenue potential.
EPS and EBIT Margin Improvement
Q3 2025 saw a significant improvement in EPS, which rose by 33% to $1.17, and EBIT, which increased by 25% to $240 million. These figures demonstrate the company’s enhanced profitability and operational efficiency.
Order Intake Surge in Canada
Order intake in Canada surged by 140% from Q3 2024, driven by robust demand across all market segments. This surge highlights the region’s critical role in the company’s growth strategy.
Successful Union Negotiations
Finning International successfully concluded union negotiations, mitigating risks to near-term operations and ensuring stability in its workforce.
Product Support Margin Pressure
The company faced a decrease in gross profit margin by 170 basis points, primarily due to lower product support margins and a higher proportion of used equipment in the revenue mix.
Lower EBIT Margin in South America
In South America, the EBIT margin decreased by 120 basis points from Q3 2024, attributed to lower product support margins and increased sales of lower-margin used equipment.
Challenges in Construction Sector
The construction sector in the U.K. and Ireland remains subdued, with new equipment sales growth being offset by lower machine utilization, posing a challenge to the company’s growth in this region.
Forward-Looking Guidance
Finning International’s guidance reflects strong financial performance and strategic execution. The company anticipates continued growth, driven by robust performance in mining, oil and gas, and data center segments. Revenue is expected to increase by 7% over the next 12 months, with product support revenue reaching $5.8 billion. The Power Systems backlog, standing at nearly $1 billion, indicates strong future demand.
In summary, Finning International’s earnings call conveyed a positive outlook, underscored by strong financial metrics and strategic achievements. Despite facing some regional challenges, the company’s focus on cost management and strategic growth areas positions it well for future success.