One of two CAT 797B mining trucks makes its debut at the Codelco ...

FINNING INTERNATIONAL INC. 2002 ANNUAL REPORT
FINNING CHILE
TOMORROW
Chile has one of the most
competitive economies
in the world, ahead of
Nicholas B. Lloyd
President and
Chief Executive Officer
One of the new services
Finning Chile offers its mining
customers is driver training
using a fully computerized
cab simulator. The simulator
allows operators to acquire
and practice the skills needed
to safely and efficiently
operate large CAT off-highway
trucks and wheel loaders,
including the CAT 797B. The
simulator can be delivered
to mine sites, reducing the
time spent in training as well
as the costs associated with
using real equipment for
this purpose. In addition,
the simulator can train an
operator to handle situations
that would be impossible
or hazardous to simulate in
the field.
During the year, Finning
Chile adopted a more
aggressive position in the
construction and forestry
sectors, resulting in improved
revenue performance and a
significant increase in market
share. With the combination
of slow economic growth and
surplus supply, these markets
have become extremely
competitive over the last
few years. Two important
deliveries during the year
were made to Empresa
Constructora Belfi S.A. and
the Mexican company Tradeco.
This equipment, consisting
of a total of 15 units, is
destined primarily for ongoing
road and infrastructure
improvements in central
Chile. This was the first
time that Belfi has chosen
Finning over other suppliers,
which demonstrates our
determination to increase
our market share in
the construction and
forestry sectors.
Finning Chile saw increased
activity in the equipment
rental market through its
branches and its new CAT
Rental Store concept. The
first CAT Rental Store in
Santiago is steadily increasing
market share. In November,
a second store was opened
in Calama, located in northern
Chile in one of the region‘s
most important mining areas.
Activity near Calama
is increasing dramatically
with Codelco expanding its
Chuquicamata mine, one of
the largest open-pit mines in
the world, to include the area
occupied by the original mine
town site. The decision means
the town’s residents have to
be relocated to the nearby
city of Calama. Finning Chile’s
CAT Rental Store and its
nearby Antofagasta branch
will benefit from this activity.
many developed countries
and all of the Latin
American economies.
After strong growth
through most of the 1990s,
Chile’s economy slowed to
GDP growth of 2.8% in 2001
and approximately 2% in
2002. The government is
forecasting growth exceeding
3% in 2003, even if copper
prices remain at current
levels. Chile has successfully
negotiated a free trade
agreement with the
European Union and is
currently negotiating a
similar relationship with
the United States.
In 2003, Finning Chile
expects modestly higher
revenues, with high-margin
activities continuing to
improve bottom line
performance. We expect
to continue to win market
share in the construction
and forestry sectors. The
mining sector revenue will
remain stable.
Beyond 2003, we are
positioned to benefit when
copper prices recover and
companies open new mines
and expand existing mines.
Finning Chile will also
benefit from synergies
with the Company’s
acquisitions in Argentina,
Uruguay and Bolivia.
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