Good morning. My name is Christine, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ritchie Bros. Auctioneers First Quarter 2017 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there’ll be a question-and-answer session. [Operator Instructions] Thank you. Jamie Kokoska, you may begin your conference.

Thank you, Christine. Good morning, everyone, and thanks for joining us in our Fiscal First Quarter 2017 Results Conference Call. Discussing Ritchie Bros. performance today are Ravi Saligram, Chief Executive Officer; and Sharon Driscoll, Chief Financial Officer. Joining them for the Q&A session following the formal remarks will be Jim Barr, Group President; Randy Wall, former President of Canada; and Anna Sgro, Senior Vice President of Sales, Canada East and Northeast U.S. The following discussion will include forward-looking statements as defined by SEC and Canadian rules and regulations. Comments that are not a statement of fact, including projections of future earnings, revenue, gross auction proceeds and other items, are considered forward-looking and involved risks and uncertainties. The risks and uncertainties that could cause our actual financial and operating results to differ significantly from our forward-looking statements are detailed in our SEC and Canadian securities filings, available on the SEC and SEDAR websites as well as our Investor Relations website at investor.ritchiebrothers.com. Our definition of gross auction proceeds may differ from those used by other participants in our industry. It is not a measure of financial performance, liquidity or revenue and is not presented in our statement of operations. Our first quarter results were made available yesterday after market close. We encourage you to review our earnings release and Form 10-Q report, which includes our MD&A and financial statements, which are available on our website as well as EDGAR and SEDAR. On this call, we will discuss certain non-GAAP financial measures. For the identification of non-GAAP financial measures, the most directly comparable GAAP financial measure and a reconciliation between the two, see our earnings release and Form 10-Q. Presentation slides accompany our commentary today. These slides can be viewed through the live or recorded webcast or downloaded from our website. All figures discussed on today’s call are in U.S. dollars, unless otherwise indicated. While we may use million or billion dollar figures for brevity in today’s discussion, all percent changes have been calculated using full and rounded figure. I’ll now turn the call over to Ravi Saligram, Chief Executive Officer.

Thank you, Jamie, and thanks to everyone for joining us on our earnings call today, which we are doing from Toronto, Canada. The first quarter of 2017 lacked a very robust first quarter last year, which had benefited from strong auction volumes related to the oil and gas dislocation in Alberta and the addition of the Grande Prairie auction for two large dispersals. The surge in volume from Western Canada has now subsided, and complete dispersals have been less frequent, which were the primary drivers of low auction volumes in the first quarter this year. As we communicated on our last earnings call, the auction calendar in the first quarter this year was more in line with auction calendar of the first quarter of 2014, given there are no onetime large auctions added to the schedule to cater to complete dispersals. Gross auction proceeds for the first quarter of 2017 were $900 million, a 12% decline from the first quarter last year. The addition of the Grande Prairie auction last year supplemented that quarter’s GAP results. Removing the impact of that auction last year, which is not a regularly scheduled event, GAP declined 7.6% from the first quarter of 2016. Likewise, we benefited from a $54 million onetime auction in Casper, Wyoming in the first quarter of 2015, which propped up that quarter’s results. Compared to the first quarter of 2014, which is the most recent quarter, with a similar auction calendar, first quarter 2017 GAP increased 5%. Turning now to revenue. Our U.S. and Europe business generated solid performance in the quarter with revenue from U.S. operations up 4% relative to the strong comparable quarter last year. Revenue contributions from this region comprised 62% of total revenue in the quarter, up from 57% in the first quarter of 2016.…

Thank you, Ravi, and good morning, everyone. Our revenue decline in the quarter was entirely volume-driven, as we achieved a more robust and first quarter record revenue rate. Volume declines drove revenue down approximately 11%, while rate improvements counteracted it by 6%, leading to a total constant currency revenue decline of 5%. Foreign exchange impacts translating revenue into U.S. dollars from operations outside of the U.S. led to an additional 1% decline for a reported 6% decline in total revenue during the first quarter. The revenue rate for the quarter was 13.84%, a company record for the first quarter. The rate was bolstered by improved auction and EquipmentOne fee revenue, Private Treaty transactions and improved performance by RBFS, Mascus and Xcira. New business lines, so those outside of our core auction and EquipmentOne channels, contributed 1.2% of the overall 13.84% during the quarter and 80 basis points of rate improvement relative to Q1 last year. Including our pre-existing business lines, the rate improved 90 basis points, again, our diversification strategy is taking hold. As Ravi discussed, we believe reviewing comparable performance is more telling of the underlying health of our business absent noise from acquisition activity and onetime items. To help you understand the puts and takes of our comparable performance, we have provided a reconciliation table on Slide 19 of today’s presentation. Adjusted performance excludes only the $2.3 million tax charge, related to an increase in uncertain tax positions due to an unfavorable outcome of the tax dispute in one of our European operating jurisdictions. When removing only this charge, adjusted net income for the quarter was $12.7 million or $0.12 diluted EPS attributable to stockholders. Comparable figures exclude the $2.3 million tax charge and also $8.6 million of pretax acquisition-related cost and $6.7 million of pretax interest expenses…

Thank you, Sharon. We continue to be very excited about our impending acquisition of IronPlanet. Our integration teams are ready to get started, and we’re well prepared for when the acquisition closes. All of our functional teams have established day 1 to day 100 integration plans to ensure we are approaching our combined business as effectively as possible. We anticipate territory alignment activities to occur soon after close to ensure our customers have no confusion as to who their established sales contact is, for the manual solutions we will soon offer. We have assessed our brand portfolio and value propositions and made key decisions on all brands for early stages of the integration. And we have a clear road map on integrating RBA and IronPlanet product offerings in the very early stages of the combined company, including such things as employee training, customer communication and support tools. Two specifics related to our integration: we will be combining our sales forces at the regional territory manager level and at the strategic accounts level, so that the customer – our customers get to interact with only one combined company, Ritchie Bros. salesperson. We will continue to have separate sales forces for our specialized businesses, such as Mascus, Crews, GovPlanet and CAT auctions. Our regional TMs will focus primarily on providing customers three product offerings. First, RBA’s unreserved live auction, which is on control and custody and a successful business model; IronPlanet’s weekly featured unreserved auction with the floor, which – where customers don’t have to move equipment; and EquipmentOne daily marketplace. This offering is a fusing of EquipmentOne and IronPlanet’s daily marketplace, which will allow seller’s price control and the ability to have reserved prices. This combined offering will still be under IronPlanet brand umbrella. These offerings will allow our TMs to…

Thank you. [Operator Instructions] Your first question comes from the line of Neil Frohnapple from Longbow Research. Your line is open.

Good morning, thank you. And Jamie, you’ll be missed, and good luck. Ravi, I understand that the other region is relatively small as a percentage of total revenue, but it did weigh on total company revenue by, call it, 3 percentage points, given the magnitude of the decline in the quarter. And I believe you say that Middle East with the high supply and lack of demand, but could you provide any more granularity on this issue? Whether it’s currency-related and how long this could potentially persist?

Well, I think in the Middle East, just given the various situations there, Neil, we’re trying in a lot of innovative things. Karl Werner, who oversees that region, in fact, tried a very innovative thing of a three in one auction with live auction in Dubai, combined with EquipmentOne and Private Treaty. We’re also utilizing this time to rev up Private Treaty in the Middle East and – but as we’ve said before, those are lumpy. We don’t know when they’ll take hold but we certainly are building a pipeline in there. I think it’s just an issue of, for the first time in the Middle East, it’s things are in all those markets. Whether it’s Saudi and neighboring countries, demand has come down. And clearly, with oil prices being where they are, it’s just been an issue. We do think, though, longer term that there is room for optimism, that things will come back. So this quarter was particularly affected. Now the other parts there are Australia, which has been pretty buoyant. And we still – that’s a very big area of focus for us. In the first quarter there, we did have one at-risk deal that did not do well, which affected results negatively. Typically, the Australian team is one of the very best at at-risk underwritten business in the company, so they tried something new in the ag space that did not quite work out. And that’s what I want our teams to do, is try things to grow the business. So that was, to me, it’s one of those onetime things but I’m very buoyant about Australia. Asia, we look at primarily as an export market and that continues to do okay in that in terms of what we are trying to do there. So really, Middle East was the one that did have an impact. And in the Middle East, by the way, we do sell things on a dollar basis, which further compounds things because, just like Mexico, we sell in U.S. dollars. And so while there’s no exchange things, but in terms of buyers, that does put some pressure.

Okay, that’s helpful. And then, Ravi, just wanted to ask about your experience as acting U.S. and LatAm president. Now that you’re even closer to the field, has your thinking about these regions changed at all strategically on how to capture the growth in these markets? Or anything else that might jump out to you as untapped opportunities?

So let’s separate the U.S. from LatAm first. And this is my second foray as acting President of the U.S. and I’m really pleased to be closer to the U.S. team. First and foremost, I think we have got an outstanding team now in the U.S. They’re really sharp on execution. And so in that regard, my leaders are really strong leaders and so that gives me particularly some reassurance. I think I continue to believe that the U.S. is – should be our number one geographic priority. My optimism for that market remains unabated. I really think it’s very good. And now with what’s happening with a focus on infrastructure. So if you look at – there are many states. What’s happening right now with construction jobs in the U.S. is not related necessarily to any Trump infrastructure bill. So a lot of states have been creative, whether they’re passed like Georgia passing a gas tax and devoting all of that to infrastructure. In certain states, as they’ve had increased revenues, as they legalize marijuana and that is creating increased revenues for those states, those are going to infrastructure. And so I think there are several states right now that are taking this to hand. And if on a federal basis, Trump managed to get, there is good bipartisan support for this, so it’s a matter of when, I think that – and whatever you read, you know that the U.S. infrastructure needs a lot. Somewhere – I just read a statistic that just maintaining bridges and roads on an annual basis is about $63 billion. So the more jobs our contractors have, the better off we’ll be. So I think that’s a positive. Right now, we’re just sort of in a situation where new equipment production or new…

Okay. Thanks for the detail, I’ll pass it on.

The next question comes from the line of Sara O’Brien from RBC. Your line is open. Sara O’Brien: Hi, good morning.

Hi, Sara. Sara O’Brien: I wondered if you could talk about the synergies at IronPlanet, if there’s been any change an expectation, just given the talk about U.S. tax change and how that might impact and maybe any others that you can see?

Hi, Sara. Yes, so we’re – as part of the integration planning, we are continuing to kind of look at integration opportunities. I said that our learnings to date, we really haven’t changed our thoughts on the synergy potential for that business as of yet. So I think the current thoughts still remain. Certainly, the U.S. tax changes, if they were to go through, could add some more value albeit, certainly, we had already baked in some opportunity due to the kind of Canadian opportunity that we have as a Canadian-based business through normal tax-type initiatives. Sara O’Brien: Okay. And then maybe just, I guess, more of a forward-looking question. But with 45% of GAP transactions online now, is there a time where you feel that the physical auction sites will become far less relevant and maybe the investment in the physical locations will be, I guess, outdated? I’m just wondering like in terms of how you look at the physical versus online and maybe how the shift might move in terms of investment towards IT going forward?

So Sara, I’ll try and take a shot at that. So I think we recognized the shifts and we’ve seen, I think, over 13% CAGR growth in online GAP over the last five, six years. So – but two things. One is that the on-site – ours is an integrated model and the on-sites are the propellers of this. There is still a lot to be said. There are a lot of customers who like kicking the tires, who want to be in the community. And one of the things you have to recognize like mobile app, they may actually be on-site but just bidding on their smartphones because they want to have anonymity. And there are a lot of customers who come and then go to their offices and bid online, again, for anonymity. So it is really – that’s why we want to be multichannel. And now having said that, do we need all the sites we have in the network? That’s something we’re going to be taking a real careful look at. And clearly, getting IronPlanet into the mix helps us be even more aggressive on it. But even without it, we would be looking at it. So we are looking at our network to say, which are sort of your flagship mega sites. I mean, clearly, Edmonton, Orlando, Dallas, Houston, et cetera, are really important magnet sites for us. Over time, we would look at, do we need all those sites? And with RIP, we also get the benefit of the CAT alliance, which allows us if we need to do some particular auctions on their sites, especially internationally. So I think you have to look at it in the mix. Our whole thing is give the customers the choice. Let’s be multichannel. They have different needs. And that’s one of the reasons the pure play online is also an important one, which is why we’re buying IronPlanet. But we’ll see how it evolves. You look at retail, the stores have not all completely disappeared. And except you just – so we want to be proactive and just look at how do these things affect it and get a very efficient network, both online and on site. Sara O’Brien: Okay. I’ll leave it that. Thank you.

Your next question comes from the line of Joe Box from KeyBanc Capital Markets. Your line is open.

Hi, guys. Can you hear me, okay.

Yes.

Great, thanks. So one thing I was hoping to talk about was the appropriate incremental margin. As the mix maybe shifts a little bit more to price, I mean, I guess, the one thing that I’m looking at here, if my math is right on adjusted EBITDA, it looks like there was about 100% decremental margin. I know there’s some moving pieces as we go forward. But I guess, just generally, how should we be thinking about that incremental margin as we kind of migrate some of these investments in a low-volume environment?

Sharon, do you want to...

Yes. So I think that’s a good question, Joe. Certainly, we do hope to get leverage off a growing revenue base. And so certainly, what we demonstrated in this quarter is that we were able to react on the variable-type costs that we were able to control. And we adjusted them appropriately due to the changing kind of volume outlook. However, a majority of our costs do remain relatively fixed. And so with declining revenue, you end up with that decrement that you’re talking about. So even though we closely controlled the cost that we could, we were unable to mitigate the impact of the declining revenue in the quarter. What I – we have been investing in talent and technology and marketing. We will continue to do so. However, we will be making those investments on a prudent and responsible basis going forward. But again, the operating model does work best in an increasing revenue environment where you start to see the flow-through off the relatively fixed cost base. But I do think the team did a remarkable job in the quarter on managing the costs that are able to be controlled that relate to volume.

So Joe, I would just echo what Sharon said and add something. Ritchie Bros., the model is and our strategy is all about revenue growth. And let us not have one quarter sort of influence our thinking about the business model. We really think the model is intact. We have – this is a lumpy business. You will see – you could always have a few quarters where things are up and down. But really, when you look at our last two years, 2015 and 2016, we showed that pretty much we delivered on the Evergreen Model with the one exception being GAP. So I think our whole focus is how do we keep driving that revenue growth. Now there will be, in this business, sometimes macro effects and this was just one of those unusual times where we got hit with both Canada and the equipment supply. We had not anticipated the equipment supply issue in the U.S. and the U.S. is strong. So typically, our whole model is about, if one engine starts having difficulties, namely Canada, that U.S. would have pick it up, it was just not enough. Secondly, we’re continuing to diversify. And I think over time, as those businesses get scaled, that will help as well. Now the one thing is that we are looking into is that the flow-through, clearly, of our businesses in things like RBA, EquipmentOne and RBFS, our high flow-through models, whereas subscription businesses and service businesses like Mascus, et cetera, et cetera, have lower flow-through. So – but they give you a little bit more predictability. So we have to think about that and say how do we improve flow-through on those businesses longer term, but it does give you some predictability to your revenue stream. So – but the bottom line is we are very committed long term to continue to drive growth and drive the flow-through that gives you very good margin performance.

Great, thank you both for that. And then just as a quick follow-up, and I apologize if you addressed this earlier. But in terms of the Private Treaty business, obviously, this is a nice arrow in the quiver. Can you just maybe talk about the sustainability of this?

So I’ll address that, Joe. So certainly, this is still a relatively new business for us and we are continuing to grow the pipeline of connections and relationships to be able to make this a good long-term stream of revenue opportunity for us going forward. I think it is a bit lumpy and a lot of the deals do take a relatively long time to be able to complete the transaction and bring the buyer and seller together. The particular deals that did take place in the quarter do relate to kind of the existing deal that was in place in quarter four of 2016. And so – but we do still have some pipeline that is currently being built up for those types of transactions. So we do see it as sustainable, but again, lumpy element to that.

So I’d like Randy to make maybe a comment on that because Randy is one of our key champions and fathers of the Private Treaty business and the Q4 deals that were brilliant were really under his leadership. So Randy?

Thanks, Ravi. I do think that Private Treaty has a potentially significant long-term runway. As Sharon mentioned, it’s very lumpy, even more lumpy than our regular auction business. And they really depend upon relationships and penetrating some of these markets that we haven’t been in as deeply before such as the mining and really energy on the more specialized product. So I think it’s definitely a tool that has opened net new doors for us and it’s exciting. It helps us play in different parts of the world for very large multinational organizations. But it’s really, really difficult to put your finger on and provide predictions in terms of kind of flow business at this stage but I’m quite optimistic about it.

So one final comment on that, which is this is – I view it as a channel and a way for us to address that whole – in the $360 billion global market, we know that there’s a lot of people who want to do private sales. And so we now have a sub-brand, Ritchie Bros. Private Treaty, to address their unique needs because this is for unique assets, high-value assets for portfolios. And there are a number of reasons why those sellers might choose to sell it privately. They’re very targeted. We’re not letting our TMs and get distracted by this. This is really done at the senior levels of the organization. And so – and it’s really – we have looked at it in the mining space, in other sectors. We now have a team that is really good at this stuff in different parts of the world. And till now, it’s been more in Middle East, little bit in Europe, in Australia and in Canada. We are also now looking at this in the U.S. So sustainable? Yes. Very lumpy? Yes. And I wouldn’t also take away that this is – because last quarter, clearly, we got a big part from it. But not all Private Treaty deals are huge margins. They resemble our regular business but it’s a great new channel for us to keep building.

I appreciate it. Thanks everyone.

Your next question comes from the line of Larry De Maria from William Blair.

Hi, thanks, good morning. Two questions. First, the U.S. is doing is well. Obviously, you’re benefiting from normal construction and also hope on the infrastructure front, but that may seem to be fading. You’re always getting pushed out. I’m just curious if you’ve seen anything in the market or your discussion with customers to suggest their sentiment may change or the initial infrastructure euphoria we thought may fade? And secondly, can you just give us a normal SG&A run rate to think about moving forward when we remove some of the noise?

So Sharon can answer question two and I’ll answer question one on the U.S. Larry, I’m not – I have talked to a lot of customers. I was at ConExpo recently where I met with many, many customers, and the mood and optimism at ConExpo was just huge. And the same at our Orlando auctions where I talked to people. I just think right now, the – I think – so we had to – the Trump message is creating optimism in the sense it’s more psychological that people are having confidence in the economy. And – but really, right now, the jobs we are seeing are state-led and where that’s already happening. So I have not yet come across where there is hopes fading. And I’ll let Anna, who handles the Northeast and Northeast needs a lot of infrastructure improvement, Anna, what do you hear from customers in the U.S?

So I echo what you’re saying, Ravi. We absolutely have a lot optimism. We’ve had some great momentum in the Northeast, particularly been with off-site sales, large transactions and customers that are now starting to free up some of the assets and looking to purchase new. So we see that carrying out and we’re quite excited about it.

Talk about Canada East in the same regard even though the question was about the U.S. because Canada East is quite different from how it behaves from Western Canada.

So Canada East had shown, obviously, through economic downturn years ago, a little bit more conservative and it always has been, particularly in Ontario with the large customer national sort of customer base. But what we’ve seen is Ontario particularly is just busting with new infrastructure spend, bus lines, underground, subway, highway expansions. So we have a huge amount of momentum, actually, in fact, one of our largest sales coming in, in the next couple of days. Historically, in Ontario, Québec is now showing great signs of some infrastructure finally flowing through. So there’s good momentum there, and we’ll have a really nice large sale, which we’re excited about. And of course, in the Atlantic provinces, we have had an enormous amount of full dispersals, and we have built up a large off-site sale in Newfoundland again, which is our second time this year, as well as building momentum in our Truro sale. So we are seeing great optimism across the East.

And Larry, with respect to the SG&A run rate, that’s a good question. I think probably the best way to look at it is almost on a dollar basis. Certainly, when I look at – we now have our executive team kind of in place, so we’re not cycling over that kind of new headcount in Q2. So that will all become relatively comparable as Becky, our CMO; Marianne, our CIO; and Frank, our Sales Leader – Sales Effectiveness Leader, are now fully in place in comparable Q2 going forward. We still will have the increased costs related to the acquired businesses of Kramer and Petrowsky for the remainder of the year, but they’re really still based – baked into our Q1 dollars. And so that’s probably the better way to look at it. We are still very much committed to our Evergreen model of growing OpEx and SG&A costs in line and less than our revenue growth, so we will keep true to that. But again, the investments that we’re making to support this transition and integration with IronPlanet will still have some lumpy nature. And even though we have, on the face of the statements, tried as best we can to pull all those acquisition costs out, there certainly is some additional pressure on our internal teams that still is embedded inside the SG&A account as they continue to do work to do the integration planning for our business.

Okay. So just to sum up, it goes down by a few million in absolute dollars but the two smaller acquisitions you made at $700,000, I believe, stays in there?

Yes. So you’re talking about the comparable. So adding in Mascus, Petrowsky and – yes, yes.

Xcira.

Xcira.

Okay. Thank you very, very much.

Your next question comes from Stephen Volkmann with Jefferies. Your line is open.

Good morning. Actually, good afternoon from here. I’m curious about the next six months or so, and Ravi, you sort of said that you thought the current conditions sort of a weaker Canada, kind of okay U.S. and growth in Europe will probably be the way things went for the next couple of – well, at least the next quarter. Does that change the mix on your revenue rate? Is Europe significantly different than Canada? How do we think about that?

I think the first part, absolutely good playback of what I said. Look, I think on the revenue rate, and I think the last slide still had it where this is one that we continue to stay focused on. And so we have said 11% to 12% for our regular auctions and then 12%-plus. Clearly, we’re beginning to do better than that. And we’ll continue to – I’m not happy that our underwritten volume in Q1 was as low as it was. And I continue to strongly encourage our teams around the world, or least specific parts of the world, North America and certain parts of Europe, Australia, to drive underwritten business. That always has and it’s very hard to predict. But we want to get more volume. It’s just a case of, in first quarter, the U.S., just customers because they felt, when you have an upward pricing market, they clearly feel, hey, on the underwritten side, we might then be the disproportionate beneficiary. So – but overall, I think without adding to any more on the guidance piece, we feel the – and Europe, at least in Southern Europe, they have done a pretty good job on the underwritten side. We are careful about underwritten in the UK and some of the northern side. But even their rates in Northern Europe have been improving. So overall, I think rate is, at least at this point, I continue to see that we’re going to hang on to good performance.

Okay, great. That’s helpful. And then maybe separately, I noticed that your – and I think you talked about how your average consignor numbers are up and so you have sort of wider touch points, I guess, you’re talking about. But the other implication of that is that the lot size is declining and that seems to be a trend that’s been kind of going on for a little while. I wonder if you think there’s anything to that or how do you react to that?

Well, I think that’s been a – the small lots have been an issue for us for the last several years. I’ll have Randy do a quick comment on that. But – and we try to exercise with our sales team’s discipline on it. Now when you have an unreserved model, sometimes, small lots are the way people come in, new consignors come into the business. I think this quarter, it was really more an issue of constrained equipment supply in the U.S. and the fact that all the issues, the search came down in Western Canada. Because I think last year in Western Canada, we had a lot of stuff coming out of oil and gas that could be repurposed into construction, which were the heavier piece of equipment. So the small lots are – continued to be an issue, which we have to manage because they do drive up labor costs in the odds. And – but we also have a different buyers fee schedule on those. So Randy, do you have anything – any other insight you want to add there?

Sure, Ravi. Small lots, the good side of the small lots is that, in many cases, they come as part of the package of a complete dispersal event. And that’s, of course, strength of Ritchie Bros. to provide that service from a palliative change all the way up to hundreds of thousands of dollars heavy piece of equipment. And the other thing that does happen in times post downturns where there’s less new product pumped into the marketplace which you have end up with is effectively an aging fleet of the equipment in the background. And then when those aged assets come to market, their average dollar value was slightly down, depending upon the age profile. So we saw that happen post-2008 and it’s early to tell now but that could be a factor at play here in the future.

Good, great. And then just one quick follow-up. I think, Ravi, you mentioned that you had seven Kramer auctions in the first quarter. Is that – did that add a meaningful amount to the year-over-year GAP numbers?

Randy, can you answer that, please?

Sure. The Kramer events were bison livestock events and they were very, very tiny. They’d be completely immaterial. And the bulk of the agricultural business really is in the second quarter, which starts in their April spring event. So very, very minor dollar value.

And just that it doesn’t give the wrong impression. We’re not now getting into the bison or cattle business. It just so happened this was a small piece of the Kramer business that we acquired and we – they’re very proud of that, justifiably so. So we – that will just continue. But it shows no intent to get into that as a new sector.

I guess I’ll have to change the title from my note and thanks. Thank you, guys.

One last question I think Jamie.

Our last question comes from Michael Doumet with Scotia Bank. Your line is open.

Yes, hi, good afternoon guys. So just two quick questions. Pretty decent growth in the U.S., both on GAP and revenue, and that’s despite the tight used equipment supply conditions. I mean, could you help us break out where some of that strength came from and whether it’s market driven and/or if you’re seeing benefits from company-specific initiatives? And then second, really, the question, Ravi, if we can get your thoughts on how and/or when equipment or used equipment supply conditions could loosen up.

Yes, so I’ll tackle the first one. And in terms of the U.S., broadly speaking, one, really the big drivers are not just the RBA live auction business but EquipmentOne as well, which is primarily in the U.S. And now it’s very important to start thinking of these models from a geographic basis on a consolidated basis. And so at EquipmentOne, we are delighted to see the traction that we’re finally beginning to get on that business. And Jim and the team have really worked very well. Sam Wyant, our Head of Strategic Accounts, is also handling that. The strength really came from certain year we had was Florida. It was – we had a number of players who have auctions in Florida and a number of competitors and had very disappointing results versus prior year. But I think our team really hit the ball out of the park. It was not chance. It was very, very – it was extremely well executed with Jake Lawson and his team driving that with – the Orlando auction grew both in GAP and in revenue versus prior year. So that was definitely a big flip. And now Orlando gets not only – it’s not just the sales team in Florida but we send equipment from different places. So it was truly great to see Texas. And Texas was really less about oil and gas. It was really – they’re really taking hold of the construction activity and stuff so that team’s really coming together under Dolan’s leadership there. So very, very – I think we’ve had that and Anna has really cranked up Northeast and I’ll let her comment on any specific initiatives. But overall, I think it has been we are getting better and better at using our sales tools. Frank’s sales effectiveness has put in place tools for our salespeople on salesforce.com. We’re looking – there’s a big laser focus on our new customer acquisition, which hopefully offsets some of the down drag during the equipment supply issues. So now the western part of the U.S. has been soft for us with equipment supply issues probably more prominent there than other places and some strategic account sectors. Rental, for instance, has been soft just because their utilizations are very high. Dealer business has been soft because, again, people are holding on. But our strength with end users, we’re really focused on them. And Anna, do you want to add anything, whether it’s for the Northeast or for the U.S. as a whole?

Sure, Ravi. I think that we’ve really approached the – in the U.S. and I’ll speak to the Northeast, but very organized, structured professional approach as the trusted adviser optimizing on our selling tools, to your point. So the team is very focused on the strategy, the tactics, and certainly, the execution. So everybody is working really hard in a very organized fashion and definitely using all of our multichannel selling solutions, so E1, our Private Treaty aspect. So I think that fell through in the East as well, in the Northeast and Canada East.

One other quick comment there is our North Central business has been doing well as well. And we’re also beginning to get some traction on agriculture even though we said the rates were – pricing was down but we’ve now used best practices and brought in some on the farm auctions. So that side is beginning to get some strength as well. But I think it’s a more scientific approach towards pipelines. I do biweekly calls with all the regional heads to go through their pipeline, look at how much GAP was sold. So we’re just tracking and bringing more discipline and driving more productivity. So that’s sort of first part of your question. Your second part was the supply issues. Tough to tell, because that’s sort of not in our control. We really don’t have that much insight into the OEMs and when – and it’s in specific sectors. Some of it’s also not related to new equipment production because there’s a strong pricing environment. Right now, we’re seeing that dealers are holding onto equipment. And actually trying to put it on, we’re seeing significant increases on listings on some of the online specialized competitors, to say Mascus in Europe, that their listings are up with dealers. Whether they will transact or not, we don’t know, but they are sort of hoping that they can capture the increases in pricing. So I think this is – I don’t know when it’ll loosen up but our whole view is our teams have to just focus on trying to find new customers and drive that. So Anna, did you have...

Yes, I just want to comment our transportation strategy over the last two years and champing across and understanding the hubs across U.S. and Canada, which we’ve really grown our transportation day two as largest. We’ve seen our day one, and traditionally, that’s not been there for us, as well as we had a very long winter. So I’d comment that we’ll start to see a lift in June and July and things releasing themselves as well.

Okay. With that, I think we’ll call it a wrap. Thank you very much for being on the call, onwards and upwards. Thank you.

This concludes today’s conference call. You may now disconnect.