These risks and uncertainties that may affect our performance significantly or could cause our actual, financial, and operating results to differ significantly from our forward-looking statements are detailed from time to time in our SEC, and Canadian Securities Filings, including our management’s discussion and analysis of financial conditions, and results of operation for the period ended June 30, 2010 and subsequent quarters, which available on the SEC, SEDAR, and company websites.Examples of these risks and these uncertainties include the supply of and demand for equipment, equipment values, the mix of equipment we sell and the impact of recent economic circumstances on our customers and their buying and selling patterns. Actual results may differ materially from those contemplated in the forward-looking statements. We do not undertake any obligation to update the information contained in this call, which speaks only as of today’s date. I’d also like to note that during the call today, we will talk about gross auction proceeds, which represents the total proceeds from all items sold at our actions. Our definition of gross auction proceeds may differ from those used by other participants in our industry. Gross auction proceeds are an important measure we use in comparing and our assessing our operating performance. It is not a measure of financial performance liquidity or revenue and is not presented in our statement of operations. The most directly comparable measure in our financial statements is auction revenues, which represent the revenues we earn in the course of conducting at our auctions. Today, we plan to give you a quick recap of some of the topics from our previous conference call in July and some of the highlights of Q2 before opening the line to questions. As you may recall, we talked in July about our GAAP being difficult to predict at the best of times and how the current economic environment has further compounded those challenges. As a result of ongoing challenges in our major markets, primarily in the United States, in July, we reduced our 2010 gross auction proceeds guidance to the ranges of 3.3 billion to 3.5 billion for the year and adjusted net earnings guidance to the range of 25% to 30% below 2009 adjusted net earnings. This guidance still stands.
I would like to reemphasize today that we believe this revised guidance is very much a result of factors arising from temporary timing issues and is not an indication that our business model or our ability to execute on our strategy are in question. Our long-term fundamentals are very much and our competitive mote remains very wide.To recap, we believe our current situation is a result of temporary market conditions and while it is predominantly centered in the United States, we have also seen a moderate slowdown in transaction volumes in Northern Europe. Equipment owners and creditors’ actions that we have experienced in previous down cycles are not yet materialized. Low interest rates, lack of confidence in the firmness of the equipment pricing environment, a lack of urgency on the part of creditors to react and liquidate assets as they have in past down cycles and equipment market participants waiting on the promised impact of government stimulus have contributed to this effect. In addition, we have seen equipment owners express a high degree of uncertainty over the yet unannounced pricing for EPA (ph) for compliant equipment, which could cause used equipment values to increase in line with expected increases in new equipment pricing. The consequence of these factors is that many equipment owners remain reluctant to trade or liquidate their inventory currently. So, even though equipment maybe sitting idle or at best drastically underutilized, they’re choosing instead to hold on to their equipment until some of these uncertainties are resolved. This is particularly acute in the U.S. market, where the dynamics remain challenging. I should add that we are not witnessing or experiencing used equipment being sold in any meaningful volumes through alternate channels or methodology. It is simply idle and not transacting. Our adjusted net earnings for the first half of 2010 came into $38.2 million compared to 58.1 million for the first half of 2009. This translates into $0.36 per diluted share, which is consistent with our expectations for the period. The primary driver of the decrease in net earnings from 2009 was the shortfall in our gross auction proceeds, which were 1.7 billion for the first half of this year compared to 1.9 billion last year.
Our auction revenue rate for the first half of 2010 remain above trend at 10.81% and higher than last year’s rate of 10.70%. The phenomenon that we have discussed preciously about our auction revenue rate remains high in the phase of challenging GAAP environment and continued in Q2 as both our at-risk and our straight commission business performed well.We were successful controlling our G&A in the face of decelerating GAAP, particularly considering the 6% increase in our headcount compared to last year. The biggest component of the increase in G&A was the effect of foreign currency translation. Read the rest of this transcript for free on seekingalpha.com