VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Aug. 9, 2005) - Finning International Inc. ("Finning") (TSX:FTT) announced today that its South American operations have successfully negotiated the sale of three equipment packages and three maintenance contracts with customers in Chile and Argentina for a total value of approximately CAD 250 million.
"Very robust commodity prices have supported our customers' decisions to expand their production capabilities by acquiring additional equipment and renewing existing fleets," noted Doug Whitehead, president and CEO of Finning International Inc., "Our clear market leadership in the mining business reflects the high quality of the Caterpillar product and the unparalleled sales and service capabilities that Finning provides."
Brian Bell, president of Finning South America, stated: "Our strong regional presence and commitment to delivering the highest quality solutions help our clients make the long-term equipment decisions necessary to take advantage of attractive metal prices. Finning remains the dominant supplier of production and support equipment to the Chilean and Argentinean mining sectors in the products we distribute."
Spence - Finning has successfully negotiated a CAD 57 million maintenance contract for the Spence project in Chile with Compania Minera Riochilex, majority owned by BHP Billiton (with minority participation by Rio Tinto). This is the most recent transaction under a global alliance that began in February 2003 between BHP Billiton and Caterpillar.
Finning previously announced the sale of the major portion of the fleet to be covered by this maintenance contract in November 2004, which consisted of 21 type 793 trucks, 2 type 994D front loaders, and associated support equipment. The equipment began to arrive on site in March 2005, with the first pieces in operation starting June 1st. Recently Finning negotiated the sale of an additional 4 type 793 trucks for CAD 9 million, and expects all machines to be operating under the terms of the new maintenance contract by May 2006. The maintenance contract has an initial term of 3 years.
The terms and conditions defining this important agreement are governed by the global alliance, as well as the client's Global Maintenance Network standards. This maintenance contract further consolidates Finning's position as the sole supplier of mining production and support equipment and solutions in BHP Billiton's Chilean operations.
Mantoverde - Finning has also negotiated the sale of an equipment package consisting of 33 CAT production and support machines worth CAD 43 million, as well as secured a significant maintenance contract worth CAD 55 million with Anglo American Chile, a division of Anglo Base Metals and owner of the Mantoverde mine in Chile. The maintenance contract includes service assistance for all the CAT machines, which will make up the mine's complete production and support fleet.
The maintenance contract covers the CAT and Atlas Copco drill fleet that will operate in the mine. This will include 9 type 785C trucks, 8 type 777D trucks, 2 type 994F front loaders, 2 type 992G front loaders, as well as the complete support fleet and 4 open surface drills. Equipment operations are scheduled to begin on September 1, 2005, and the maintenance contract has an initial term of 5 years.
Veladero - In addition, Finning announced the sale of 17 pieces of Caterpillar equipment to Minera Argentina Gold S.A., a Barrick Gold Corporation subsidiary, for use in the Veladero gold mine project in Argentina. The equipment package is worth CAD 35 million and includes 12 type 793 mining trucks, 2 type D11R bulldozers, 2 type 16H motorgraders and 1 type 854G wheel dozer.
The new machines will all be delivered by February 2006, integrated into the existing fleet and covered by accompanying new maintenance contracts worth CAD 51 million, which, together with the current maintenance contract, will provide complete coverage at the mine site until November 2009.
Finning International Inc. is one of the world's largest Caterpillar equipment dealers. The Company sells, rents, finances and provides customer support services for Caterpillar equipment and engines in Western Canada, the U.K., and South America (Argentina, Bolivia, Chile and Uruguay). Finning also owns Hewden, the largest equipment rental business in Europe. Headquartered in Vancouver, British Columbia, Canada, Finning International Inc. is a widely held, publicly traded corporation, listed on the Toronto Stock Exchange (symbol FTT).
This release may contain forward-looking statements and information, which reflect the current view of Finning International Inc. with respect to future events and financial performance. Any such forward-looking statements are subject to risks and uncertainties and Finning's actual results of operations could differ materially from historical results or current expectations. Finning assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein do not materialize.
Refer to Finning's annual report, management information circular, annual information form and other filings with the Ontario Securities Commission and Toronto Stock Exchange for further information on risks and uncertainties that could cause actual results to differ materially from forward-looking statements contained in this report.
FOR FURTHER INFORMATION PLEASE CONTACT:
Finning International Inc.
Vice President, Investor Relations
(604) 331-4899 (FAX)