RB Global, Inc. (NYSE: RBA) (TSX: RBA) today announced the appointment of Jim Kessler, most recently the Company’s President and Chief Operating Officer, as Chief Executive officers. So Mr. Kessler wants to join RB Global’s Board of Directors. Megan Cash, most recently Senior Vice President, Global Control and Corporate Finance has been appointed Principal Finance and Accounting Officer. These appointments are effective immediately and follow the departures of Ann Fandozzi and Eric Jacobs as Chief Executive Officer and Chief Financial Officer, respectively. The Board will be conducting a search for a permanent Chief Financial Officer with the assistance of an executive search firm.
Mr. Kessler has a proven record of driving growth and value creation, including through M&A. Since joining RB Global as COO in 2020, Mr. Kessler has been integral in developing and executing the customer engagement strategies and offerings that have transformed RB Global from a traditional auctioneer into a premier, global omnichannel marketplace. He was also a major part of the due diligence underpinning the IAA, Inc. acquisition and has spearheaded the ongoing execution of related cost savings and revenue growth initiatives. Prior to joining RB Global, Mr. Kessler directed the successful integration of Caliber Collision and ABRA Auto Body and Glass to create the largest consolidator in the $47 billion collision repair industry.
Erik Olsson, Chair of the RB Global Board of Directors, said:
“Jim has been a valuable member of RB Global’s leadership and has played a critical role in the development and execution of our marketplace strategy. He is a hands-on, results-driven executive with a deep understanding of RB Global’s business and building effective teams that provide outstanding customer service and value creation. We are confident that Jim is the right leader to advance RB Global’s strategy and operating excellence.”
“RB Global is on a path of exciting growth, and I am honored to lead the Company in the next phase of our evolution,” said Mr. Kessler. “We have an incredible team that is energized by our strategic transformation and the upside ahead. I look forward to working with our employees as the Company’s new CEO to capitalize on the talent, expertise and innovation across RB Global. We are committed to delivering on the value creation objectives we have set for our shareholders and the exceptional service we have promised to Ritchie Bros .’s and IAA’s customers.”
“Megan brings deep experience with RB Global, having first joined the Company in 2018. This knowledge and her finance expertise will ensure a smooth transition as we conduct a search for RB Global’s next Chief Financial Officer,” continued Mr. Kessler.
Mr. Olsson added, “Ann is a visionary, and since she joined RB Global in 2020, we have recruited new leaders who, through organic initiatives, partnerships and strategic acquisitions, have taken bold steps to redefine the Company’s operating model and reinvigorate profitable growth. On behalf of the Board, we thank Ann and Eric for their valuable contributions to the Company’s many achievements and wish them the best in the future.”
Considerations Leading to Executive Departures
RB Global noted that Ms. Fandozzi’s and Mr. Jacobs’ departures are unrelated to the Company’s performance, financial reporting and results of operations.
The changes follow extensive negotiations with Ms. Fandozzi regarding an appropriate executive compensation structure. In the course of these discussions, Ms. Fandozzi required that, in order for her to continue as CEO, the Board needed to approve a front-loaded compensation program that would bring forward 5-years of equity compensation. The Board unanimously determined that such structure and the magnitude of the associated payout reaches far beyond peer group benchmarks, is out of step with market standards and is not in the best interests of the Company or RB Global shareholders. Although the Board attempted to work with Ms. Fandozzi in good faith on this matter, Ms. Fandozzi was unwilling to accept any pay package that was not front-loaded and informed the Board of her decision to resign.
Preliminary Second Quarter 2023 Financial Results
RB Global also reported today strong preliminary second quarter 2023 financial results, including123:
- GTV increased 146% year-over-year to $4.1 billion, which includes $2.2 billion from the impact of the acquisition of IAA. The Company expects GTV growth in the third quarter to be low- to mid-single digits year-over-year on a combined basis.
- Total revenue increased 128% year-over-year to $1.1 billion, which includes $560.4 million from the impact of the acquisition of IAA.
- Service revenue increased 181% year-over-year to $806.1 million, which includes $476.6 million from the impact of the acquisition of IAA.
- Inventory sales revenue increased 52% year-over-year to $300.4 million, which includes $83.8 million from the impact of the acquisition of IAA.
- Net income increased 63% year-over-year to $86.8 million.
- Adjusted EBITDA increased 126% year-over-year to $307.8 million.
- Diluted earnings per share available to common stockholders decreased 13% to $0.42 per share.
- Diluted adjusted earnings per share available to common stockholders increased 15% year-over-year to $0.85 per share.
As previously announced, RB Global is hosting a conference call at 1:30 pm Pacific time / 4:30 pm Eastern time on August 3, 2023, and will discuss its full second quarter 2023 financial results and the leadership changes at that time. Conference call and webcast details are available at the following link: investor.rbglobal.com.