Fiscal 2013 First Six Months Results

For the six months ended July 31, 2012, revenue increased 32.2% to $831.8 million from $629.0 million for the same period last year. Gross margin for the first six months of fiscal 2013 was 16.9%, compared to 17.3% in the same period last year. Pre-tax income for the first six months of fiscal 2013 was $21.1 million for a pre-tax margin of 2.5%, compared to $22.6 million, or a pre-tax margin of 3.6%, for the same period last year. Net income attributable to common stockholders for the first six months of fiscal 2013 was $12.7 million, or $0.60 per diluted share, compared to $13.4 million, or $0.69 per diluted share, for the same period last year. The six-month weighted average diluted common shares outstanding for the first six months of fiscal 2013 was 21.0 million, compared to 19.4 million weighted average diluted common shares outstanding in the same period last year.

Balance Sheet

The Company ended the second quarter of fiscal 2013 with cash and cash equivalents of $126.5 million. The Company’s inventory level was $938.3 million as of July 31, 2012, compared to $748.0 million at the end of fiscal 2012. This inventory level primarily reflected an increase in new equipment, which increased to $626.4 million at July 31, 2012 from $445.5 million at January 31, 2012, while used equipment decreased slightly to $211.9 million at July 31, 2012 from $219.8 million at January 31, 2012. Given the increased new equipment supply in the Agriculture industry, the Company has adjusted its strategy for new equipment inventory and expects this strategy will result in a decrease of new equipment inventory, excluding acquisitions, during the back half of fiscal 2013 after peaking in the third quarter of fiscal 2013. The Company will continue to manage used equipment levels and valuations regularly but due to seasonally higher new equipment demand in the back half of the year the used equipment inventory level is anticipated to increase by the end of fiscal 2013. The Company had available $162.0 million of its $800.0 million total discretionary floorplan lines of credit as of July 31, 2012.

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