RITCHIE BROS AUCTIONEERS INC : MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

About Us

Established in 1958, Ritchie Bros. (NYSE and TSX: RBA) is a world leader in
asset management technologies and disposition of commercial assets. We offer
customers end-to-end solutions for buying and selling used heavy equipment,
trucks and other assets. Operating in a number of sectors, including
construction, transportation, agriculture, energy, oil and gas, mining, and
forestry, the company's selling channels include: Ritchie Bros. Auctioneers, the
world's largest industrial auctioneer offers live auction events with online
bidding; IronPlanet, an online marketplace with featured weekly auctions and
providing the exclusive IronClad Assurance® equipment condition certification;
Marketplace-E, a controlled marketplace offering multiple price and timing
options; Mascus, a leading European online equipment listing service; Rouse, a
leader in market intelligence on sales and rental equipment data; SmartEquip, an
innovative technology platform offering equipment lifecycle support and part
procurement; and Ritchie Bros. Private Treaty, offering privately negotiated
sales. Our suite of multichannel sales solutions also includes RB Asset
Solutions, a complete end-to-end asset management and disposition system. We
also offer sector-specific solutions including GovPlanet, TruckPlanet, and Kruse
Energy Auctioneers, plus equipment financing and leasing through Ritchie Bros.
Financial Services.

Through our unreserved on site and online bidding auctions, online marketplaces,
and private brokerage services, we sell a broad range of used and unused
commercial assets, including earthmoving equipment, truck tractors, truck
trailers, government surplus, oil and gas equipment and other industrial assets.
Construction and heavy machinery comprise the majority of the equipment sold.
Customers selling equipment through our sales channels include end-users (such
as construction companies), equipment dealers, original equipment manufacturers
("OEMs"), and other equipment owners (such as rental companies). Our customers
participate in a variety of sectors, including heavy construction,
transportation, agriculture, energy, and mining.

Overview


This section of the Form 10-K generally discusses 2021 and 2020 items and
year-to-year comparisons between 2021 and 2020. Discussions of 2019 items and
year-to-year comparisons between 2020 and 2019 that are not included in this
Form 10-K can be found in "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in Part II, Item 7 of the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2020. This discussion
and analysis should be read in conjunction with the "Cautionary Note Regarding
Forward-Looking Statements" and the consolidated financial statements and the
notes thereto included in "Part II, Item 8. Financial Statements and
Supplementary Data" presented in this Annual Report on Form 10-K. This
discussion and analysis contains forward-looking statements that involve risks
and uncertainties.

Our actual results could differ materially from those expressed or implied in
any forward-looking statements due to various factors, including those set forth
under "Part I, Item 1A: Risk Factors" in this Annual Report on Form 10-K. The
date of this discussion is as of February 17, 2022.

We prepare our consolidated financial statements in accordance with U.S.
generally accepted accounting principles ("US GAAP"). Except for GTV, which is a
measure of operational performance and not a measure of financial performance,
liquidity, or revenue, the amounts discussed below are based on our consolidated
financial statements. Unless indicated otherwise, all tabular dollar amounts,
including related footnotes, presented below are expressed in thousands of
United States ("U.S.") dollars.

In the accompanying analysis of financial information, we sometimes use
information derived from consolidated financial data but not presented in our
financial statements prepared in accordance with US GAAP. Certain of these data
are considered "non-GAAP financial measures" under the SEC rules. The
definitions and reasons we use these non-GAAP financial measures and the
reconciliations to their most directly comparable US GAAP financial measures are
included either with the first use thereof or in the Non-GAAP Measures section
within the MD&A. Non-GAAP financial measures referred to in this report are
labeled as "non-GAAP measure" or designated as such with an asterisk (*).

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Performance Overview

Net income attributable to stockholders for 2021 decreased 11% to $151.9 million
compared to $170.1 million in 2020. Diluted earnings per share ("EPS")
attributable to stockholders decreased 12% to $1.36 from $1.54 per share.
Non-GAAP adjusted net income attributable to stockholders* increased 4% to
$216.1 million in 2021 as compared to $208.7 million in 2020. Non-GAAP diluted
adjusted EPS attributable to stockholders* increased 3% to $1.94 per share in
2021 as compared to $1.89 per share in 2020.

In 2021, we updated the calculation of our non-GAAP diluted adjusted EPS
attributable to stockholders* to add-back share-based payments expense, all
acquisition-related costs (including any share-based continuing employment costs
recognized in acquisition-related costs), amortization of acquired intangible
assets, and gain or loss on disposition of property, plant and equipment. We
have also adjusted for certain non-recurring advisory, legal and restructuring
costs and the change in fair value of derivatives. These adjustments in 2021
have been applied retrospectively to all periods presented, as applicable.

For the year ended December 31, 2021 as compared to the year ended December 31,
2020
:


Consolidated results:

? Total revenue increased 3% to $1.4 billion

o Service revenue increased 5% to $917.8 million

o Inventory sales revenue decreased 1% to $499.2 million

? Operating income decreased 9% to $240.1 million

? Non-GAAP adjusted operating income* increased 3% to $323.5 million

? Net income decreased 11% to $151.9 million

? Non-GAAP adjusted Earnings Before Interest, Taxes, Depreciation and

Amortization* (“EBITDA”) increased 3% to $385.3 million

? Cash provided by operating activities was $317.6 million for the year ended

December 31, 2021

Cash on hand was $1.4 billion, of which $326 million was unrestricted and

? $933.5 million was restricted relating to our two senior notes entered into in

December 2021 to finance the proposed Euro Auctions Acquisition, and the

remainder is restricted for use

Auctions & Marketplaces segment results:

? GTV increased 2% to $5.5 billion and decreased 0.4% when excluding the impact

of foreign exchange

? A&M total revenue increased 1% to $1.3 billion

o Service revenue increased 3% to $759.4 million

o Inventory sales revenue decreased 1% to $499.2 million

Other Services segment results:

? Other Services total revenue increased 20% to $158.4 million

o RBFS revenue increased 46% to $47.0 million

o Rouse revenue of $26.4 million was recognized in 2021, which was its full year

since its acquisition on December 8, 2020

o SmartEquip revenue of $2.9 million was recognized in Q4 2021, which was its

first two months since its acquisition on November 2, 2021

Operational highlights


In 2021, the organization focused on the needs of our customers while keeping
the health and safety of all our stakeholders a top priority. We continue to
execute against our growth strategy of becoming the trusted global marketplace
for insights, services, and transaction solutions for commercial assets. Ritchie
Bros continues to focus on the customer and despite the ongoing COVID-19 and the
economic uncertainties, we are executing on factors that we can control to drive
strong operational results and profitable growth:

GTV from Marketplace-E, our online reserved format, increased 20%
? year-over-year driven by continued strong North America adoption of the

platform.

We held a hybrid-style global auction event in Orlando, Florida, selling in
? excess of US$191 million. The six-day sale was a spectacular success, as we

sold more than 12,000 items in six days for US$191+ million, making it the

largest-ever 100% online equipment auction.


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In March 2021, we conducted our largest Texas auction ever, attracting 76% more
? bidders from 79 countries year over year and achieving US$95 million in GTV

surpassing our previous Texas sales record, set in June 2020, by 17 %

In May 2021, we conducted 71 farm auctions to disperse farm retirement
? equipment across Western Canada, attracting more than 160,000 bidders,

generating over $1.6 million online equipment views and over CA$104 million of

GTV.

In August 2021, Ritchie Bros. conducted its largest-ever, single-owner auction
? for Barrilleaux Inc., an oilfield pipeline construction company based in New

Mexico and Texas and sold in excess of US $99 million of pipeline construction

equipment in less than two days.

In 2021, we won the two new East and West contracts, covering the consolidated
? surplus rolling stock and surplus non-rolling stock assets for the U.S.

Department of Defense.

Ritchie Bros. Inspection Services and its 400+ team members completed more than
? 600,000 equipment inspections in 2021, taking over 15 million photos and

analyzing hundreds of thousands of oil samples in its in-house fluid analysis

lab.

Ritchie Bros. Financial Services (RBFS) total funded volume hit $747.8 million,
? increasing 43% year over year, driven by investments in the team in 2020 and

strategic efforts over sales activities in 2021 leading to enhanced lender

alignment.



We accelerated our journey against many of our strategic pillars by completing
the acquisition of SmartEquip, a leading parts and service technology company in
November of 2021 for a purchase price of $173 million which furthers our goal of
providing the best experience for our customers. We also entered into a SPA
agreement to acquire Europe's leading plant and machinery auction house, Euro
Auctions, for an enterprise value of £775 million (approximately US$1.08
billion). In addition to the acquisition, we took several steps to advance our
new growth strategy in 2021 highlighted below:

Customer Experience

Improved digital experience with more comprehensive video inspections, upgraded
? mobile platform, launched new concierges virtual yard walks and equipment

demos, and implemented RitchieID which enables single customer identity across

all Ritchie Bros. digital properties

Launched Ritchie List to give our customers more ways to bring their equipment

to market. RitchieList.com is an easy-to-use equipment listing service which
? offers our customers a suite of a la carte services to make private selling

more efficient and safe, including a secure transaction management service,

complete with invoicing.

? Simplified contracts for sellers to focus on a better experience

? Improved customer call center wait times by launching call back feature and

  improved routing


Best Employee Experience

? Launched enhanced safety programs for field employees to make sure employees

return home every day the way they came to work

? Created training experience for members in the Sale organization and leadership

development program for international teams

? Launched Pride (LGBTQ+) and Serve (Military Veterans) Employee Resource Group

and Diverse Voices, a Ritchie Bros. Podcast for employees

? Drove employee engagement by crowdsourcing ESG Social Giving Initiatives

Modern Architecture

? Launched cloud-based inspection microservice to enable scalable growth

? Began improving Iron Planet experiences for customers by starting a migration

of our systems and platforms to the cloud

Inventory Management System

Launched business version of our inventory management system (“IMS”), which
? offers our customers end-to-end asset management and disposition services, data

analytics, dashboards, branded e-commerce sites and multiple external sales

channels to help our customers achieve optimal returns

? Organizations activated on IMS grew at a ~83% compounded average quarterly

growth rate in 2021 using Q1 2021 as the base

? Improved digital experience by adding a number of customer centric features

? Improved backend systems and processes to enable faster growth


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? Increased use of IMS for transactional workflow

Accelerate growth: Test, learn and scale

? Scaled Local Satellite Yards with 18 new locations in 2021

Successfully implemented new sales coverage model in Texas by disaggregating
? territory manager role into Account Manager, Business Development Manager, and

Inside Territory Manager



While focusing on growth and our strategic initiatives, we continued to make
progress on our Environmental, Social, and Governance (ESG) mission. Our choice
of expansion through local satellite yards is ensuring we continue to enable the
circular economy on a local basis by growth in a low-cost and environmentally
friendly way. We have made significant progress against our goals to enhance our
employee experience in the areas of diversity, equity and inclusion (DE&I) and
community. We have several new active employee-led groups driving initiatives,
and also made strides on female representation at the senior leadership level.

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Results of Operations

                                                                         Year ended December 31,
                                                                                                       % Change
(in U.S. $000's, except EPS and
percentages)                                   2021           2020           2019         2021 over 2020       2020 over 2019
Service revenue:
Commissions                                 $   469,718    $   452,882    $   431,781                   4 %                  5 %
Fees                                            448,041        418,714        372,243                   7 %                 12 %
Total service revenue                           917,759        871,596        804,024                   5 %                  8 %
Inventory sales revenue                         499,212        505,664        514,617                 (1) %                (2) %
Total revenue                                 1,416,971      1,377,260      1,318,641                   3 %                  4 %
Costs of services                               146,862        157,296        164,977                 (7) %                (5) %
Cost of inventory sold                          447,921        458,293        480,839                 (2) %                (5) %
Selling, general and administrative
expenses                                        464,599        417,523        382,389                  11 %                  9 %
Total operating expenses                      1,176,824      1,114,100      1,095,439                   6 %                  2 %
Operating income                                240,147        263,160        223,202                 (9) %                 18 %
Operating income as a % of total
revenue                                            16.9 %         19.1 %         16.9 %             (220) bps              220 bps
Non-GAAP adjusted operating income*             323,471        314,514        259,915                   3 %                 21 %
Non-GAAP adjusted operating income* as
a % of total revenue                               22.8 %         22.8 %         19.7 %                 - bps              310 bps
Net income attributable to
stockholders                                    151,868        170,095        149,039                (11) %                 14 %
Non-GAAP adjusted net income
attributable to stockholders*                   216,106        208,660        173,969                   4 %                 20 %
Diluted earnings per share
attributable to stockholders                $      1.36    $      1.54    $      1.36                (12) %                 13 %
Non-GAAP diluted adjusted EPS
attributable to stockholders*               $      1.94    $      1.89    $      1.59                   3 %                 19 %
Effective tax rate                                 26.0 %         27.8 %   
     21.8 %             (180) bps              600 bps

Total GTV                                     5,533,931      5,411,218      5,140,587                   2 %                  5 %
Service GTV                                   5,034,719      4,905,554      4,625,970                   3 %                  6 %
Service revenue as a % of total GTV                16.6 %         16.1 %         15.6 %                50 bps               50 bps
Inventory GTV                                   499,212        505,664        514,617                 (1) %                (2) %

Service revenue as a % of total                                                                       150
revenue                                            64.8 %         63.3 %         61.0 %                   bps              230 bps
Inventory sales revenue as a % of
total revenue                                      35.2 %         36.7 %         39.0 %             (150) bps            (230) bps
Cost of inventory sold as a % of
operating expenses                                 38.1 %         41.1 %         43.9 %             (300) bps            (280) bps
Service GTV as a % of total GTV - Mix              91.0 %         90.7 %         90.0 %                30 bps               70 bps
Inventory sales revenue as a % of                                          
                         (30)
total GTV - Mix                                     9.0 %          9.3 %         10.0 %                   bps             (70) bps


Total GTV

Total GTV increased 2% to $5.5 billion as compared to 2020. Total GTV decreased
0.4% in 2021 as compared to 2020, when excluding the impact of foreign exchange.


In 2021, GTV increased primarily in International and Canada, while remaining
flat in the US. GTV volume increased primarily due to strong price performance
across all regions as a result of high demand for used equipment, predominantly
in the construction and transportation sectors, and these increases were
partially offset by an unfavorable tight supply environment which impacted all
regions. In International, GTV volume increases were driven by the lifting of
border restrictions, improved economic climate and higher activity in Australia
with new auctions, higher number of private treaty deals and a new agricultural
event. We also saw strong performance in France with the growth of local
satellite yards, partially offset by lower volume in Europe due to supply
constraints. In Canada, we saw an increase in volumes across several auctions,
most notably within the Canadian agricultural market with the shift to online
driving a higher number of events and a larger buyer base. In addition, we saw a
strong performance in Toronto throughout the year due to unprecedented demand.
Canada also benefited from significant volume increases in RBFS from providing
escrow services for private brokered transactions. These increases were
partially offset by softer year-over-year performances across our Western region
due to supply chain constraints. In the US, we saw strong performances by our US
regional sales team and also GovPlanet. US region performance was strong with a
$99.0 million pipeline construction equipment event in New Mexico and Texas as
well as a $35.0 million construction event in Alabama, partially offset by lower
year-over-year performances in our Fort Worth, Orlando, and Las Vegas auctions
and our regional combined events. GovPlanet saw higher volumes with the new
non-rolling and rolling stock contracts effective June 1, 2021. However,
offsetting these increases, total US GTV was flat with lower volume in our US
strategic accounts sales team and also the non-repeat of a collector car event.
US strategic accounts were down mainly in the finance, OEM and

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rental sectors as high asset utilization, supply chain challenges and new
inventory availability have continued to impact disposition volumes.

Total revenue

Total revenue increased 3% to $1.4 billion as compared to 2020, with total
service revenue increasing by 5%, offset by a decrease in inventory sales
revenue by 1%.

Foreign currency fluctuation also had a favourable impact on our revenue
primarily due to the appreciation of the Canadian dollar, the Euro and the
Australian dollar relative to the US dollar.

Service Revenue

In 2021, total service revenue increased 5% with fees revenue increasing 7% and
commissions revenue increasing 4%. Service revenues comprise of commissions
which are earned on Service GTV, and Fees which are earned on total GTV as well
as from our other services such as Ancillary Services, RBFS, Rouse, Mascus, RB
Logistics, RB Asset Solutions and SmartEquip.

Service GTV increased 3% driven by positive results across all regions due to
the continued strong pricing despite the unfavourable supply environment. In
Canada, positive year-over-year performances in our Canadian agricultural market
and Toronto auction, and an increase in escrow services provided by our RBFS
business contributed to higher Service GTV, which was partially offset by softer
performances in our Western region. International saw higher service GTV as a
result of increased activity in Australia combined with a new agricultural
event, and higher activity in Europe, most notably in France with the growth of
local satellite yards, and as well as due to the improved market economic
conditions and the ease of restrictions from the gradual recovery of COVID-19,
despite the supply constraints. In the US, Service GTV remained relatively flat.
We saw large dispersals of $99.0 million pipeline construction equipment and a
$35.0 million construction event in Alabama, however, these increases were
offset by overall softer performances most notably in Fort Worth, Orlando and
Las Vegas due to the tight supply environment. In addition, the non-repeat of a
collector car event also contributed to lower volume.

Fees revenue increased 7%, mainly due to fee revenue earned from Rouse which was
acquired in early December 2020, higher fees driven by higher funded volumes in
RBFS, and higher buyer fees in line with higher GTV of 2%. Buyer fees increased
in part due to an increase in buyer fees implemented earlier in the year, as
well as from the re-instatement of fees at the Canadian on-the-farm auctions at
the beginning of the year. These increases were partially offset by lower fees
on mix of lower proportion of small value lots across all regions, most notably
in the US, and lower fees from our Ancillary services as some sellers have
elected to forgo paint or repair services driven by a strong market demand for
used equipment and lower unit of volumes in the construction and transportation
end markets. We also saw lower listing fees in line with lower online volumes,
and lower document fees due to decline in the total number of titled lots sold.
The non-repeat of a collector car event in the US also contributed to lower fee
revenue.

Commissions revenue increased 4%, largely driven by the increase in Service GTV
of 3%. The remaining increase in commission revenue was driven by improved rates
on guarantee contracts in the US driven by strong pricing performance. We also
saw stronger straight commission rate performance in our GovPlanet business
driven by favourable mix of contracts and a lower proportion of GTV sourced
from
our US strategic accounts.

Inventory Sales Revenue

Inventory sales revenue as a percent of total GTV decreased to 9% from 9.3% in
2020.


In 2021, inventory sales revenue decreased 1% primarily in Canada and the US due
to lower mix of inventory contracts, offset by International. In Canada, we had
a large inventory package dispersal of pipeline equipment in Grand Prairie which
did not repeat and lower inventory volumes in Edmonton. In the US, we saw lower
inventory volumes in Fort Worth and Orlando, partially offset by higher
GovPlanet volume following the government shut down in response to COVID-19 in
prior year. These decreases were offset by strong year-over-year performance in
International mainly driven by higher activity including increased number of
private treaty transactions in Australia, and across various countries in Europe
due to the overall improved economic conditions and the addition of several
new
auctions.

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Underwritten Contracts

We offer our customers the opportunity to use underwritten commission contracts
to serve their disposition strategy needs, entering into such contracts where
the risk and reward profile of the terms are agreeable. Our underwritten
contracts, which include inventory and guarantee contracts, decreased to 18% in
2021, compared to 20% 2020 primarily due to decreased GTV signed with guarantee
contracts.

Operating income
Operating income decreased 9% to $240.1 million compared to $263.2 million in
2020. This decrease was primarily due to the 6% increase in total operating
expenses to support our growth initiatives, partially offset by a 5% increase in
service revenue in 2021. Operating expenses included higher selling and general
administrative expenses due to increases in our employee wages, salaries and
benefits, and higher buildings, facilities and technology costs. We also saw
higher non-recurring advisory, legal and restructuring costs in the fourth
quarter of 2021. In addition, we incurred $30.2 million in acquisition-related
costs for the acquisitions of Euro Auctions, SmartEquip and Rouse. We also began
amortizing the acquired intangible assets from Rouse and SmartEquip in 2021. In
terms of ongoing operations, cost of services was lower, partially offset by a
lower flow through from inventory sales.

Income tax expense and effective tax rate


We recorded an income tax expense of $53.4 million in 2021 compared to $65.5
million in 2020. Our effective tax rate was 26.0% compared to 27.8% in 2020. The
decrease in the effective tax rate over the comparative period was primarily due
to a decrease in the estimate of non-deductible expenses, lower income taxes
related to tax uncertainties, and higher tax deduction for share unit expenses
in excess of compensation expense. Partially offsetting this decrease was a
higher estimate of income taxed in jurisdictions with higher tax rates and lower
deduction for stock options exercised.

On April 8, 2020, the United States Department of Treasury and the Internal
Revenue Service ("IRS") clarified income tax benefits related to hybrid
financing arrangements would not be deductible ("Hybrid Interest"). The lower
estimate of non-deductible expenses is primarily due to the net income tax
benefits of approximately $7.8 million in the twelve months ended December 31,
2019 which were no longer deductible and accordingly were reversed in 2020.

Net income


Net income attributable to stockholders decreased 11% to $151.9 million compared
to $170.1 million in 2020. The decrease was primarily related to lower operating
income and lower other income. We also recognized a $1.2 million loss due to the
change in the fair value of derivatives which are being used to manage our
exposure to foreign currency exchange rate fluctuations on our purchase
consideration for the acquisition of Euro Auctions. These decreases were
partially offset by the decrease in the income tax expense driven by the lower
effective tax rate.

Diluted EPS

Diluted EPS attributable to stockholders decreased 12% to $1.36 per share
compared to $1.54 in 2020. This decrease was primarily due to the decrease in
net income attributable to stockholder, combined with an increase in the
weighted average number of dilutive shares outstanding over 2020.

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U.S. dollar exchange rate comparison

We conduct global operations in many different currencies, with our presentation
currency being the U.S dollar. The following table presents the variance in
select foreign exchange rates over the comparative reporting periods:


                                                                                               % Change
                                                                                       2021 over    2020 over
Value of one local currency to U.S dollar            2021        2020      
 2019        2020         2019
Period-end exchange rate
Canadian dollar                                      0.7846      0.7843      0.7656            0 %          2 %
Euro                                                 1.1322      1.2296      1.1202          (8) %         10 %
Australian dollar                                    0.7250      0.7689      0.7002          (6) %         10 %

Average exchange rate -Year ended December 31,
Canadian dollar                                      0.7977      0.7462      0.7537            7 %        (1) %
Euro                                                 1.1834      1.1413      1.1195            4 %          2 %
Australian dollar                                    0.7514      0.6901      0.6951            9 %        (1) %


In 2021, approximately 45% of our revenues and 47% of our operating expenses
were denominated in currencies other than the U.S. dollar, compared to 43% and
48%, respectively, in 2020.

We recognized $0.8 million in foreign exchange losses in 2021 and $1.6 million
of losses in 2020. Foreign exchange had a favourable impact on total revenue and
an unfavourable impact on expenses. These impacts were mainly due to the
fluctuations in the Canadian dollar, the Euro and the Australian dollar
exchanges rates relative to the U.S. dollar during the year.

Non-GAAP Measures


As part of management's non-GAAP measures, we may eliminate the financial impact
of adjusting items which are after-tax effects of significant recurring and
non-recurring items that we do not consider to be part of our normal operating
results.

In 2021, we updated our calculation of non-GAAP measures and included the impact
of share-based payments expense, all acquisition-related costs (including any
share-based continuing employment costs recognized in acquisition-related
costs), amortization of acquired intangible assets and gain or loss of
disposition of property, plant and equipment. We have also adjusted for certain
non-recurring advisory, legal and restructuring costs and the change in fair
value of derivatives. These adjustments in 2021 have been applied
retrospectively to all periods presented, as applicable.

Non-GAAP adjusted net income attributable to stockholders* increased 4%, to
$216.1 million compared to $208.7 million in 2020.

Non-GAAP diluted adjusted EPS attributable to stockholders* increased 3% to
$1.94 per share compared to $1.89 per share in 2020.

Non-GAAP adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
(“EBITDA”)* increased 3% to $385.3 million compared to $374.3 million in 2020.


Debt at December 31, 2021 represented 11.5 times net income for 2021, compared
to debt at December 31, 2020, which represented 3.9 times net income for 2020.
The increase in this debt/net income multiplier was primarily due to higher debt
balances and higher operating expense mainly due to an increase in
acquisition-related costs on the acquisitions of Rouse, Euro Auctions and
SmartEquip for the year ended December 31, 2021 compared to December 31, 2020.
The non-GAAP adjusted net debt/non-GAAP adjusted EBITDA* was 1.3 times at
December 31, 2021 compared to 1.0 times at December 31, 2020. The increase in
non-GAAP adjusted net debt/non-GAAP adjusted EBITDA* was primarily due to higher
non-GAAP adjusted net debt* balance at December 31, 2021, partially offset by a
3% increase in non-GAAP adjusted EBITDA* compared to the prior year.

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Segment Performance
We provide our customers with a wide array of services. The following table
presents a breakdown of our consolidated results between the A&M segment and
Other services segment. A complete listing of channels and brand solutions under
the A&M segment, as well as our Other services segment, is available under Item
1 of this Annual Report.

                                     Year ended December 31, 2021                  Year ended December 31, 2020                  Year ended December 31, 2019
(in U.S $000's)                   A&M          Other       Consolidated         A&M          Other       Consolidated         A&M          Other       Consolidated
Service revenue               $   759,303    $ 158,456    $      917,759   

$ 740,043 131,553 $ 871,596 $ 678,823 $ 125,201 $

804,024

Inventory sales revenue           499,212            -           499,212        505,664            -           505,664        514,617            -      

514,617

Total revenue                   1,258,515      158,456         1,416,971   

1,245,707 131,553 1,377,260 1,193,440 125,201

1,318,641

Ancillary and logistical
service expenses                        -       52,301            52,301              -       59,982            59,982              -       59,252      

59,252

Other costs of services            85,415        9,146            94,561         92,195        5,119            97,314         99,821        5,904      

105,725

Cost of inventory sold            447,921            -           447,921   
    458,293            -           458,293        480,839            -           480,839
SG&A expenses                     414,287       50,312           464,599        388,442       29,081           417,523        358,016       24,373           382,389
Segment profit                    310,892       46,697           357,589        306,777       37,371           344,148        254,764       35,672           290,436

Auctions and Marketplaces segment


Results of A&M segment operations are presented below for the comparative
reporting periods.

                                                                 Year ended December 31,
                                                                                               % Change
                                                                                        2021 over     2020 over
(in U.S. $000's, except percentages)          2021           2020           2019          2020          2019
Service revenue                            $   759,303    $   740,043    $   678,823            3 %           9 %
Inventory sales revenue                        499,212        505,664        514,617          (1) %         (2) %
Total revenue                                1,258,515      1,245,707      1,193,440            1 %           4 %
A&M service revenue as a % of total                                                            90           250
A&M revenue                                       60.3 %         59.4 %         56.9 %            bps           bps
Inventory sales revenue as a % of                                                            (90)         (250)
total A&M revenue                                 39.7 %         40.6 %         43.1 %            bps           bps
Costs of services                               85,415         92,195         99,821          (7) %         (8) %
Cost of inventory sold                         447,921        458,293        480,839          (2) %         (5) %
SG&A expenses                                  414,287        388,442        358,016            7 %           8 %
A&M segment expenses                           947,623        938,930        938,676            1 %           0 %
Cost of inventory sold as a % of A&M                                                        (150)         (240)
expenses                                          47.3 %         48.8 %         51.2 %            bps           bps
A&M segment profit                             310,892        306,777        254,764            1 %          20 %
Total GTV                                    5,533,931      5,411,218      5,140,587            2 %           5 %
A&M service revenue as a % of total                                        
                    -
GTV- Rate                                         13.7 %         13.7 %         13.2 %            bps        50 bps

Gross Transaction Value

In response to COVID-19, in March 2020, we transitioned all our traditional on
site auctions to online bidding utilizing our existing online bidding technology
and simultaneously ceased almost all public attendance at our live auction
theaters. Our core online auction channels (IronPlanet.com, GovPlanet.com,
Marketplace-E) continued to operate as usual.

To facilitate the auction process transition to a virtual platform and under
strict safety guidelines, we enabled equipment drop off at our physical yards
prior to the online event, with buyers able to conduct inspections pre-auction
and collect equipment post auction. In addition, where auctioneers were not able
to attend a physical site, we used Timed Auctioned Lots (TAL) solutions for
selected International and on-the-farm agriculture events.

We believe it is meaningful to consider revenue in relation to GTV. Total GTV
and Service GTV by geographical regions, as well as GTV by sector, are presented
below for the comparative reporting period.

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GTV by Geography

                                                                                             Year ended December 31,
                                                                                                                         % Change
                                                                                                                  2021 over    2020 over
(in U.S. $000's)                                                             2021         2020         2019         2020         2019
Total GTV by Geography
United States                                                          $   3,230,708    3,235,548    3,027,459          (0) %          7 %
Canada                                                                     1,441,929    1,392,249    1,254,857            4 %         11 %
International                                                                861,294      783,421      858,271           10 %        (9) %
Total GTV                                                                  5,533,931    5,411,218    5,140,587            2 %          5 %

Service GTV by Geography
United States                                                              3,029,661    3,017,404    2,756,843            0 %          9 %
Canada                                                                     1,410,252    1,307,992    1,214,223            8 %          8 %
International                                                                594,806      580,158      654,904            3 %       (11) %
Total Service GTV1                                                         5,034,719    4,905,554    4,625,970            3 %          6 %

1 Service GTV is calculated as total GTV less inventory sales revenue

GTV by Sector

The following pie charts illustrate the breakdown of total GTV by sector for the
year ended December 31, 2021, December 31, 2020, and December 31, 2019.


The construction sector includes heavy equipment such as trucks, excavators,
cranes and dozers. The transportation sector includes vehicles, buses, trailers
and trucks that are used for transport. The other sector primarily includes
equipment sold in the agricultural, forestry and energy industries.

In 2021, total GTV mix compared to 2020 decreased by 2% in the construction
sector and remained flat in the transportation sector.


                           [[Image Removed: Graphic]]

Total Auction Metrics


We review a number of metrics including the following key metrics, to evaluate
our business, measure our performance, identify trends affecting our business,
formulate business plans and make strategic decisions.

Bids per lot sold. Each bid is completed electronically through our real-time
online bidding system. A "lot" is defined as a single asset to be sold, or a
group of assets bundled for sale as one unit. This metric calculates the total
number of bids received for a lot divided by the total number of lots sold.
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Total lots sold. We define a lot as a single asset to be sold, or a group of
assets bundled for sale as one unit. Low value assets are sometimes bundled into
a single lot, collectively referred to as "small value lots".

                                        For the year ended December 31,
                                                                     % Change
                         2021       2020       2019      2021 over 2020    2020 over 2019
Bids per lot sold *          28         24         18                17 %              33 %
Total lots sold *       493,371    543,342    506,510               (9) %               7 %

* Management reviews industrial equipment auction metrics excluding GovPlanet;
as a result, GovPlanet business metrics are excluded from these metrics


The number of bids per lot sold increased 17% to 28 in 2021 driven by a higher
demand for used equipment from buyers in a tight supply market, as well as due
to our increased marketing efforts and higher online activity.

The total lots sold decreased 9% to 493,371 in 2021 primarily impacted by the
tight supply market, and the shift to a lower proportion of small value lots
sold across all regions, partially offset by higher average selling prices.

Online bidding


Across all channels, 100% of total GTV was purchased by online buyers compared
to 94% in 2020. The increase in internet bidders and online buyers is a direct
impact of COVID-19, as we pivoted to 100% online bidding from our traditional on
site auctions where on site attendance was not permitted. We will continue to
monitor the evolving impact of COVID-19 going forward and consider when a
transition back to some measure of in-person attendance at our on site auction
events is safe.

Productivity

The majority of our business continues to be generated by our A&M segment
operations. Sales Force Productivity within this segment is an operational
statistic that we believe provides a gauge of the effectiveness of our Revenue
Producers in increasing GTV. Revenue Producers is a term used to describe our
revenue-producing sales personnel. This definition is comprised of Regional
Sales Managers and Territory Managers.

Our Sales Force Productivity for the year ended December 31, 2021 increased 6.3%
to $14.2 million per Revenue Producer as compared to $13.4 million per Revenue
Producer in 2020, primarily as a result of a decrease in the number of Revenue
Producers combined with the increase in GTV.

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A&M revenue

Total A&M revenue increased 1% to $1.3 billion as compared to 2020.

A&M revenue by geographical region are presented below:


                                                                Year ended 

December 31,

                                                                                           % Change
(in U.S. $000's, except percentages)       2021         2020         2019        2021 over 2020  2020 over 2019
A&M Revenue by Geography
United States
Service revenue                            473,064      475,482      419,164           (1) %                 13 %
Inventory sales revenue                    201,047      218,144      270,616           (8) %               (19) %
A&M revenue- United States                 674,111      693,626      689,780           (3) %                  1 %
Canada
Service revenue                            193,722      179,397      167,389             8 %                  7 %
Inventory sales revenue                     31,677       84,257       40,634          (62) %                107 %
A&M revenue- Canada                        225,399      263,654      208,023          (15) %                 27 %
International
Service revenue                             92,517       85,164       92,270             9 %                (8) %
Inventory sales revenue                    266,488      203,263      203,367            31 %                (0) %
A&M revenue- International                 359,005      288,427      295,637            24 %                (2) %
Total
Service revenue                            759,303      740,043      678,823             3 %                  9 %
Inventory sales revenue                    499,212      505,664      514,617           (1) %                (2) %
A&M total revenue                        1,258,515    1,245,707    1,193,440             1 %                  4 %


United States

Service revenue remained flat, in line with Service GTV. The decrease was
primarily due to lower fees on a lower proportion of small value lots, lower
listing fees driven by lower online volumes and lower document fees driven by a
decline in the total number of titled lots sold. These decreases were offset by
an increase in buyer fees implemented earlier in the year. We saw positive rate
performances in our guarantee contracts driven by strong pricing and positive
rate performances in our GovPlanet business due to favourable mix and in our
straight commission contracts driven by a lower proportion of GTV sourced from
strategic accounts.

Inventory sales revenue decreased 8% primarily due to lower volumes of inventory
contracts sourced at our combined regional events, and at several of our other
auctions, but primarily in Fort Worth and Orlando. These decreases were
partially offset by higher volumes sold through our GovPlanet business as a
result of the new non-rolling and rolling stock contracts effective June 1, 2021
and higher volumes due to the government shutdowns in the prior year in response
to COVID-19.

Canada

Service revenue increased 8% in line with the 8% increase in Service GTV. The
increase in fees was primarily due to the re-instatement of fees waived at the
Canadian on-the-farm auctions in 2020 as part of our COVID-19 response, and
higher buyer fees implemented earlier in the year. These increases were offset
by softer rates in GTV contributed by RBFS from facilitating financing
arrangements.

Inventory sales revenue decreased 62%, primarily due the non-repeat of a large
inventory package dispersal of pipeline equipment in Grand Prairie, and lower
mix of inventory contracts contributing to lower year-over-year performances in
our Western region, mainly in Edmonton.

International

Service revenue increased 9%, partly due to the 3% increase in Service GTV. The
remaining increase was due to the higher buyer fees implemented earlier in the
year and a higher buyer fee structure on higher volumes sold in Australia.

Inventory sales revenue increased 31%, primarily driven by positive
year-over-year performance from higher volumes of inventory contracts sourced in
Australia with new auctions and a new agricultural event. We also saw higher
private treaty deals in Australia, strong performances at our auctions in Europe
with the addition of several new auctions and local satellite yards, and higher
inventory volumes from the improved economic conditions from the gradual
recovery of COVID-19 in Australia, Europe and the Middle East.

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Costs of services
A&M cost of services decreased 7% to $85.4 million primarily driven by cost
savings in travel, advertising and promotion expense primarily in Q1 2021 as a
result of lower activity at our on site auctions with 100% online bidding and
increased utilization of TAL solutions. We also saw cost savings in employee
compensation costs from lower activity at our on site auctions and cost
reductions in building, facilities and technology expenses primarily due to the
non-repeat of costs relating to a collector car event in Q1 2020. These
decreases were partially offset by higher employee compensation expenses in our
GovPlanet and Xcira businesses to support our growth strategy, as well as an
unfavourable foreign exchange impact.

Cost of inventory sold

A&M cost of inventory sold decreased 2% to $447.9 million, primarily in line
with the 1% decrease in inventory sales revenue.

SG&A expenses

A&M segment SG&A expenses increased 7% to $414.3 million which reflects an
unfavourable foreign exchange impact as well as higher wages, salaries and
benefit expenses driven by higher headcount to accelerate our growth initiatives
and our transformational journey to a trusted global marketplace. Theses
increases were partially offset by the non-repeat of a one-time severance of
$4.3 million related to realignment of leadership in 2020 and lower short term
incentive expenses driven by a softer performance and the non-repeat of a
COVID-19 incentive benefit. Building, facilities and technology costs also
increased primarily in our GovPlanet business as a result of the new non-rolling
and rolling stock contracts effective June 1, 2021 and due to higher licensing
and subscription technology expenses as we shift to cloud-based solutions to
improve customer experience.

Other Services Segment

Results of Other Services segment operations are presented below for the
comparative reporting periods.

Year ended December 31,

                                                                                                        % Change
(in U.S. $000's, except percentages)              2021           2020           2019        2021 over 2020    2020 over 2019
Service revenue                                $   158,456    $   131,553    $   125,201                20 %               5 %
Ancillary and logistical service expenses           52,301         59,982         59,252              (13) %               1 %
Other costs of services                              9,146          5,119          5,904                79 %            (13) %
SG&A expenses                                       50,312         29,081         24,373                73 %              19 %
Other services profit                          $    46,697    $    37,371    $    35,672                25 %               5 %

Other Services revenue increased 20% to $158.5 million due to the increase in
revenue from Rouse of $24.5 million, higher RBFS revenues of $14.8 million, $2.9
million of higher revenues from the acquisition of SmartEquip on November 2,
2021, and higher revenues in Mascus and RB Logistics. These increases were
partially offset by lower ancillary revenue of $14.6 million as some sellers
have elected to forgo paint or repair services, and lower fees earned on
redeployment of assets in the US. We also saw lower revenues of $3.1 million in
our asset appraisal services.

Ancillary and logistical service expenses decreased 13% to $52.3 million, in
line with lower ancillary revenues. Other costs of services increased 79% to
$9.1 million mainly due to the inclusion of Rouse as this is the full year of
costs recognized since acquisition and due to the inclusion of SmartEquip which
was acquired on November 2, 2021. SG&A expense increased 73% to $50.3 million
primarily in wages, salaries and benefits expenses in line with the growth in
our RBFS business and the inclusion of Rouse and SmartEquip.

RBFS revenue increased 46% driven by higher funded volume and improved rate on
fees earned from facilitating financing arrangements as well as the growth in
our PurchaseSafe service to provide escrow services to private brokered
transactions. Some of the positive performance in RBFS also benefited from the
favourable impact of foreign exchange fluctuation, as well as from a larger
dedicated sales team driving increased volumes compared to 2020. Funded volume,
which represents the amount of lending brokered by RBFS, increased 43% to $747.6
million, and increased 33% when excluding the impact of foreign exchange.

Other Services profit increased 25% to $46.7 million driven by our Rouse and
RBFS operations, offset by less profits on lower ancillary services and asset
appraisal services.

Additionally, in the first quarter of 2021, we launched a business version of
our inventory management system ("IMS"), which offers our customers end-to-end
asset management and disposition services, data analytics, dashboards, branded
e-commerce sites and

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multiple external sales channels to help our customers achieve optimal returns.
We continue to grow the number of organizations activated on IMS. In 2021, the
compounded average quarterly growth rate for organizations activated on our IMS
was ~83% using Q1 2021 as the base.

As we evolve to a marketplace, we also facilitate retail and peer-to-peer
auction events and equipment sale transactions via our online technology in
exchange for hosting fees. In 2021, customers that used this service disposed of
$142.8 million of assets, which is an increase of 67% as compared to prior year.

Share repurchase program


On May 8, 2019, our Board of Directors authorized a share repurchase program for
the repurchase of up to $100 million worth of our common shares, approved by the
Toronto Stock Exchange, over a total period of 12 months. In 2020, we
repurchased 1,525,312 common shares for $53,170,000 as part of this program
until it ended on May 8, 2020 as follows:

                                                         Issuer purchases of equity securities
                                                                                                              (d) Maximum
                                                                                  (c) Total number of      approximate dollar
                                                                                  shares purchased as     value of shares that
                        (a) Total number of shares     (b) Average price paid      part of publicly       may yet be purchased
                                purchased                    per share             announced program       under the program
March 5-23, 2020                         1,525,312    $                  34.85              1,525,312    $                  N/A


On August 5, 2020, our Board of Directors authorized a share repurchase program
for the repurchase of up to $100.0 million worth of our common shares, approved
by the Toronto Stock Exchange, over a period of 12 months, ending August 23,
2021. We did not repurchase any shares in 2020 or in 2021 as a part of this
program.

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Liquidity and Capital Resources


Our principal sources of liquidity are our cash provided by operating activities
and borrowings from our revolving credit facilities, which we renewed on
September 21, 2021. In addition, we have senior notes currently being held in
escrow to fund the Euro Auctions Acquisition.

In 2021, our operational liquidity was not materially impacted by COVID-19. We
believe that our existing working capital, availability under our credit
facilities, and senior notes held in escrow are sufficient to satisfy our
present operating requirements and contractual obligations. Our material
short-term cash requirements include (a) inventory purchases, (b) capital
expenditures for intangible assets and property, plant and equipment, (c)
payment of quarterly dividends on an as-declared basis, (d) settlement of
contracts with consignors and other suppliers, (e) personnel expenditures, with
a majority of bonuses paid annually in the first quarter following each fiscal
period, (f) income tax payments, primarily paid in quarterly instalments, (g)
lease payments, and (h) principal payments on short-term and current portions of
long-term debt, and (i) interest payments related to our current debt
obligations. Note 26 of our consolidated financial statements details our
commitments for expenditures on property, plant and equipment and intangible
assets, as well as our commitment for inventory purchases under two-year
contracts. Other long-term cash requirements include long-term debt principal
repayments, which are listed according to maturity date in Note 21 of our
consolidated financial statements, as well as interest payments related to our
non-current debt obligations. We are also committed under various letters of
credit and provide certain guarantees in the normal course of business. The Euro
Auctions Acquisition funding will constitute a material cash requirement upon
closing, as could the funding of any future share repurchases or mergers and
acquisitions.

With future uncertainty due to COVID-19, we will continue to evaluate the nature
and extent of any impacts to our liquidity as events unfold. Our future growth
strategies continue to include but are not limited to the development of our
A&M, RBFS, Rouse, and Mascus operating segments, as well as other growth
opportunities such as mergers and acquisitions, including the Euro Auctions
Acquisition. The execution of these growth strategies may affect our financing
needs and ability to make payments on our debt, fund our other liquidity needs
and make planned capital expenditures. Upon sale of our Bolton, Ontario property
we intend to relocate to a replacement auction site in Amaranth, Ontario. The
proceeds of the sale will be used to largely repay debt while the replacement
property will be funded from cashflow from ongoing operations.

If we were to consider further acquisitions to deliver on our strategic growth
drivers, we may seek financing through equity markets or additional debt
markets. The sale of equity securities may result in dilution to our
shareholders. Issuances of preferred equity securities could provide for rights,
preferences or privileges senior to those of our common stock. Further, this
additional capital may not be available on reasonable terms, or at all.

We assess our liquidity based on our ability to generate cash and secure credit
to fund operating, investing, and financing activities. Our liquidity is
primarily affected by fluctuations in cash provided by operating activities,
significant acquisitions of businesses, payment of dividends, share repurchases,
our net capital spending1, and voluntary repayments of our Delayed-Draw Term
Loan Facility ("DDTL Facility"). We believe our principal sources of liquidity,
combined with the senior notes held in escrow, the new upsized DDTL Facility of
$205.0 million, and approximately $170.0 million ($210.0 million CAD) of
anticipated proceeds on the sale of our Bolton, Ontario, property are sufficient
to fund our current operating activities and future growth strategies, including
the proposed acquisition of Euro Auctions.

Cash provided by operating activities can fluctuate significantly from period to
period due to factors such as differences in the timing, size and number of
auctions during the period, the volume of our inventory contracts, the timing of
the receipt of auction proceeds from buyers and of the payment of net amounts
due to consignors, as well as the location of the auction with respect to
restrictions on the use of cash generated therein.

1 We calculate net capital spending as property, plant and equipment additions

plus intangible asset additions less proceeds on disposition of property, plant

  and equipment.


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As previously discussed, we have agreed pursuant to the SPA (subject to
anti-trust and other customary closing conditions) to purchase Euro Auctions for
£775.0 million (approximately $1.05 billion). On September 21, 2021, we amended
our existing Credit Agreement, increasing our DDTL Facility to $295.0 million,
of which $205.0 million remains undrawn at December 31, 2021 and is available to
fund the acquisition of Euro Auctions. On December 21, 2021, we issued $933.0
million of new senior notes into escrow, which are also available to fund the
Euro Auctions Acquisition. Consequently, we cancelled the commitments entered
into in Q3 for the senior secured revolving facility, senior secured term loan
facility and the senior unsecured bridge facility from Goldman Sachs Bank USA.
The Company intends to fund the Euro Auctions Acquisition GBP purchase price by
using proceeds from a GBP term loan draw, as well as the issuances of the new
senior notes, which are denominated in US and Canadian dollars. Since a
significant portion of the funding must be converted to GBP to pay for Euro
Auctions, the Company is exposed to foreign currency risk. To mitigate a portion
of this risk, the Company entered into GBP/USD and GBP/CAD deal contingent
forward foreign exchange contracts, which are described in Note 4 of the
consolidated financial statements.

Cash flows

                                                               Year ended December 31,
                                                                                            % Change
                                                                                    2021 over      2020 over
(in U.S. $000's, except percentages)         2021           2020          2019        2020           2019
Cash provided by (used in):
Operating activities                      $   317,586    $   257,872      332,793          23 %         (23) %
Investing activities                        (214,066)      (276,722)     (36,057)        (23) %          667 %
Financing activities                          960,908      (111,461)    (187,218)       (962) %         (40) %
Effect of changes in foreign currency
rates                                         (8,871)         16,950        5,171       (152) %          228 %
Net increase in cash, cash equivalents,
and restricted cash                       $ 1,055,557    $ (113,361)      

114,689 (1,031) % (199) %



Net cash provided by operating activities increased $59.7 million in 2021 mainly
due to higher net cash inflow from the change in operating assets and
liabilities. This change arose primarily from a cash inflow driven by higher
auction proceeds payable related to the timing, size, and number of auctions
with higher GTV in the month of December 2021 versus December 2020, as well as
net inflows from inventory with lower investments in Australia and higher sales
in Europe. These increases were partially offset by negative cash flows driven
by larger bonus payments and the timing of payments related to local payroll,
consumption and income taxes over the comparative period, as well as the
prepayment of one quarter's interest on the senior notes held in escrow.

Net cash used in investing activities decreased $62.7 million in 2021. This
decrease was primarily due to the $171.0 million cash outflows for the November
2, 2021 SmartEquip acquisition being less than the $250.0 million cash outflows
for the December 8, 2020 Rouse acquisition. Partially offsetting this change was
lower cash proceeds from land sales and equity investments in 2021 compared to
2020. In the comparative period, these inflows included $15.5 million of net
proceeds on the sale of land in the United States, $4.2 million of proceeds on
the distribution of equity investments, and $1.7 million of proceeds on
contingent consideration from equity investments.

Net cash provided by financing activities increased $1.1 billion in 2021. This
increase was primarily due to the following changes over the comparative period:

? $933.5 million net proceeds from long-term debt from the December 21, 2021

issuance senior notes held in escrow to fund the Euro Auctions Acquisition;

? $137.5 million net proceeds from long-term debt from draws on our revolving

credit facility to fund the SmartEquip acquisition in November 2021; and

? No share repurchases in 2021, whereas we spent $53.2 million on share

repurchases in Q1 2020.

Partially offsetting this change was a $27.9 million decrease in cash generated
from the issuance of share capital on exercise of stock options and $12.1
million
more dividends paid to shareholders over the comparative period.

Working capital


Working capital is calculated as total current assets less total current
liabilities. Working capital at December 31, 2021 was $173.8 million, an
increase of $131.6 million compared to 2020. The increase in working capital is
primarily attributed to $317.6 million in cash provided from operations related
to net income after adjusting for items not affecting cash and net changes in
operating assets and liabilities. This increase was partially offset by $103.8
million of cash outflows for the payment of dividends and $43.5 million of
intangible asset and property, plant and equipment purchases.

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Dividend information
We declared and paid a regular cash dividend of $0.22 per common share for the
quarters ended September 30, 2020, December 31, 2020, and March 31, 2021. We
declared and paid regular cash dividends of $0.25 per common share for the
quarter ended June 30, 2021 and September 30, 2021. We have declared, but not
yet paid, a dividend of $0.25 per common share for the quarter ended December
31, 2021. All dividends that we pay are "eligible dividends" for Canadian income
tax purposes unless indicated otherwise.

Return on average invested capital


Our return on average invested capital is calculated as net income attributable
to stockholders divided by our average invested capital. We calculate average
invested capital over a trailing 12-month period by adding the average long-term
debt over that period to the average stockholders' equity over that period.

Return on average invested capital decreased 390 bps to 6.8% in 2021 from 10.7%
in 2020. This decrease is primarily due to a $630.4 million, or 40%, increase in
average invested capital over the comparative period, which was driven by the
senior notes issued into escrow on December 21, 2021 and revolving credit
facility draws to fund SmartEquip in November 2021. Also contributing to this
change is a $18.2 million decrease net income attributable to stockholders over
the comparative period. Return on invested capital ("ROIC") excluding escrowed
debt (non-GAAP measure) decreased 100 bps to 12.3% in 2021 from 13.3% in 2020.

Credit facilities

On August 14, 2020, we entered into an amendment of the Credit Agreement dated
October 27, 2016 totaling US$630.0 million with a syndicate of lenders
comprising:

(1) Multicurrency revolving facilities of up to US$530.0 million (the “Revolving

Facilities”); and,

(2) A delayed-draw term loan facility of up to US$100.0 million (the “DDTL

Facility” and together with the Revolving Facilities, the “Facilities”).



On September 21, 2021, we entered into another amendment of the Credit Agreement
("September 2021 Amendment"). The September 2021 Amendment, among other things,
(i) extended the maturity date of the Facilities from October 27, 2023 to
September 21, 2026, (ii) increased the total size of the Facilities provided
under the Credit Agreement to up to $1.045 billion, including $295.0 million of
commitments under the DDTL Facility, (iii) reduced the applicable margin for
base rate loans and LIBOR loans at each pricing tier level, (iv) reduced the
applicable percentage per annum used to calculate the commitment fee in respect
of the unused commitments under the Revolving Facilities at each pricing tier
level and (v) included customary provisions to provide for the eventual
replacement of LIBOR as a benchmark interest rate.

Immediately prior to the September 2021 Amendment, the aggregate principal
amount outstanding under the DDTL Facility was $90.0 million ($118.9 million
CAD). In connection with the amendment, we refinanced that amount with the
proceeds from a borrowing under the DDTL Facility. There are no mandatory
principal repayments of borrowings under the DDTL Facility until the remaining
$205.0 million is drawn. Once the DDTL Facility is fully drawn, borrowings are
subject to mandatory principal repayments at an annual amortization rate of 5%,
payable in quarterly installments, with the balance payable at maturity.

Credit facilities at December 31, 2021 and 2020 were as follows:


(in U.S. $000's, except percentages)            December 31, 2021      December 31, 2020     % Change
Committed
DDTL Facility                                  $           298,284    $            98,420         203 %
Revolving credit facilities                                750,000                530,000          42 %
Uncommitted
Revolving credit facilities                                 10,000                 10,000           - %
Total credit facilities                        $         1,048,284    $           628,420          67 %
Unused
DDTL Facility                                  $           205,000    $                 -           0 %
Revolving credit facilities                                525,581                455,124          15 %
Total credit facilities unused                 $           730,581    $    
      455,124          61 %


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Revolving credit facilities

At December 31, 2021, of the $760.0 million in revolving credit facilities,
$750.0 million relates to our syndicated credit facility and $10.0 million
relates to credit facilities in certain foreign jurisdictions.

On December 31, 2021, we had $525.6 million of unused revolving credit
facilities, which consisted of:

? $515.6 million under our Credit Agreement that expires on October 27, 2023;

? $5.0 million under a foreign credit facility that expires on October 27, 2023;

and

? $5.0 million under a foreign demand credit facility that has no maturity date.



Term loan facility

We did not make any voluntary prepayments to our drawn term loan in 2021. During
2020, we made voluntary prepayments totaling $62.7 million on the drawn term
loan denominated in U.S. dollars. Prepayments are applied against future
scheduled mandatory payments. The term loan currently drawn from the DDTL
Facility was only available to finance the IronPlanet acquisition and is not
available for other corporate purposes upon repayment of those borrowed amounts.
We intend to use the undrawn $205.0 million available under the DDTL Facility to
partially finance the Euro Auctions Acquisition and any related fees and
expenses.

Senior unsecured notes

2016 Notes

At December 31, 2021, we had senior unsecured notes (the "2016 Notes")
outstanding that expire on January 15, 2025 for an aggregate principal amount of
$500.0 million, bearing an interest rate of 5.375% per annum. The proceeds of
the offering of the 2016 Notes were used to finance the IronPlanet acquisition.
The 2016 Notes are jointly and severally guaranteed on an unsecured basis,
subject to certain exceptions, by each of our subsidiaries that is a borrower or
guarantees indebtedness under the Credit Agreement.

2021 Notes


On December 21, 2021, we completed the offering of two series of senior notes:
(i) $600.0 million aggregate principal amount of 4.750% senior notes due
December 15, 2031 (the "2021 USD Notes") and (ii) $425.0 million Canadian dollar
aggregate principal amount of 4.950% due December 15, 2029 ( the "2021 CAD
Notes", and together with the 2021 USD Notes, the "2021 Notes").

The gross proceeds from the offering together with certain additional amounts
including prepaid interest were placed into escrow accounts and will be held in
escrow until the completion of the Euro Auctions Acquisition. If the Euro
Auctions Acquisition is not consummated on or before September 30, 2022 or the
SPA is terminated prior to such date, we will redeem all of the outstanding 2021
Notes at a redemption price equal to 100% of the original offering price of the
2021 Notes, plus accrued and unpaid interest. Once out of escrow, interest on
the 2021 Notes is payable semi-annually.

We intend to use the net proceeds from the offering of the 2021 Notes to
partially fund the consideration payable of the Euro Auctions Acquisition and
any related fees and expenses. Until completion of the Euro Auctions
Acquisition, the 2021 Notes are secured only by the amounts deposited into
certain escrow accounts established in connection with the issuance of the 2021
Notes. Upon consummation of the proposed Euro Auctions Acquisition, the 2021
Notes will be, jointly and severally, fully and unconditionally guaranteed, on a
senior unsecured basis, subject to certain exceptions, by each of our
subsidiaries that is a borrower or guarantees indebtedness under our Credit
Agreement and 2016 Notes. Euro Auctions, and its respective subsidiaries that
become a borrower or guarantor under the Credit Agreement are expected to become
guarantors following the consummation of the Euro Auctions Acquisition.

Debt covenants

We were in compliance with all financial and other covenants applicable to our
credit facilities at December 31, 2021. Our debt covenants did not change as a
result of amending our Credit Agreement.

Our ability to borrow under our syndicated revolving credit facility is subject
to compliance with financial covenants of a consolidated leverage ratio and a
consolidated interest coverage ratio. In the event of sustained deterioration of
global markets and economies, we expect the covenants pertaining to our leverage
ratio would be the most restrictive to our ability to access funding under our
Credit Agreement. We continue to assess the impact of COVID-19 on our business
and evaluate courses of action to maintain current levels of liquidity and
compliance with our debt covenants.

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The Credit Agreement contains certain covenants that could limit the ability of
the Company and certain of its subsidiaries to, among other things and subject
to certain significant exceptions: (i) incur, assume or guarantee additional
indebtedness; (ii) declare or pay dividends or make other distributions with
respect to, or purchase or otherwise acquire or retire for value, equity
interests; (iii) make loans, advances or other investments; (iv) incur liens;
(v) sell or otherwise dispose of assets; and (vi) enter into transactions with
affiliates. The Credit Agreement also provides for certain events of default,
which, if any of them occurs, would permit or require the principal, premium, if
any, interest and any other monetary obligations on all the then outstanding
amounts under the Credit Agreement to be declared immediately due and payable.

Our senior notes were issued pursuant to indentures, dated December 21, 2016 and
December 21, 2021, with U.S. Bank National Association as trustee, and in the
case of the 2021 CAD Notes with TSX Trust Company as Canadian co-trustee. The
indentures contain covenants that limit our ability, and the ability of certain
of our subsidiaries to, among other things and subject to certain significant
exceptions: (i) incur, assume or guarantee additional indebtedness; (ii) declare
or pay dividends or make other distributions with respect to, or purchase or
otherwise acquire or retire for value, equity interests; (iii) make any
principal payment on, or redeem or repurchase, subordinated debt; (iv) make
loans, advances or other investments; (v) incur liens; (vi) sell or otherwise
dispose of assets; and (vii) enter into transactions with affiliates. The
indentures also provide for certain events of default, which, if any of them
occurs, would permit or require the principal, premium, if any, interest and any
other monetary obligations on all the then outstanding Notes under the
applicable indenture to be declared immediately due and payable.

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Critical Accounting Policies, Judgments, Estimates and Assumptions


In preparing our consolidated financial statements in conformity with US GAAP,
we must make decisions that impact the reported amounts and related disclosures.
Such decisions include the selection of the appropriate accounting principles to
be applied and the assumptions on which to base accounting estimates. In
reaching such decisions, we apply judgments based on our understanding and
analysis of the relevant circumstances and historical experience. COVID-19
resulted in significant global economic disruption, which can cause a greater
degree of uncertainty around our long-term cash projections. As COVID-19
continues to develop, we may make changes to these estimates and judgments over
time, which could result in meaningful impacts to our financial statements in
future periods.

The following discussion of critical accounting policies and estimates is
intended to supplement the significant accounting policies presented in the
notes to our consolidated financial statements included in "Part II, Item 8:
Financial Statements and Supplementary Data" presented in this Annual Report on
Form 10-K, which summarize the accounting policies and methods used in the
preparation of those consolidated financial statements. The policies and the
estimates discussed below are included here because they require more
significant judgments and estimates in the preparation and presentation of our
consolidated financial statements than other policies and estimates. Actual
amounts could differ materially from those estimated by us at the time our
consolidated financial statements are prepared.

Business combinations


Accounting for business combinations requires management to make significant
estimates and assumptions, particularly for the valuation of intangible assets.
The fair value of intangible assets are based upon widely-accepted valuation
techniques, including discounted cash flows, multi period excess earnings
method, and relief from royalty method, depending on the nature of the assets
acquired or liabilities assumed. Inherent in each valuation technique are
critical assumptions, including future cash flows and growth rates, gross
margins, attrition rates, royalty rates, discount rates, and terminal value and
forecast period assumptions. The discount rates used to discount expected cash
flows to present values are typically derived from a weighted average cost of
capital analysis and adjusted to reflect inherent risks. Unanticipated events
and circumstances may occur that could affect either the accuracy or validity of
such assumptions, estimates or actual results. We also issue common shares in
return for continuing employment services from certain previous unitholders or
shareholders which are measured at the fair value on acquisition date and
amortized to acquisition-related costs until restrictions lapse and the common
shares have vested.

Goodwill

Goodwill is not amortized, but it is tested annually for impairment as of
December 31, or more frequently if events or changes in circumstances indicate
that those assets might be impaired. Goodwill is tested for impairment at a
reporting unit level, which is at the same level or one level below an operating
segment. We determined our reporting units to be A&M, Mascus, Rouse and
SmartEquip.

We have the option of performing a qualitative assessment of a reporting unit to
determine whether a quantitative impairment test is necessary. A qualitative
assessment involves evaluating factors to determine the existence of events or
circumstances that would indicate whether it is more likely than not that the
fair value of the reporting unit to which goodwill belongs is less than its
carrying amount. If the qualitative assessment indicates that the fair value of
the reporting unit is more likely than not less than the carrying amount, then a
quantitative impairment test would be performed.

If a quantitative impairment test is required, the process is to identify
potential impairment by comparing the reporting unit's fair value with its
carrying amount. The reporting unit's fair value is determined using various
valuation methodologies based on an income approach or a market approach. In
determining the reporting unit's fair value, management is required to make
judgments and assumptions relating to future cash flows, growth rates and
economic and market conditions. Historically, our reporting units have generated
sufficient returns to recover the cost of goodwill.

A&M reporting unit goodwill

For the year ended December 31, 2021, we performed a qualitative assessment of
the A&M reporting unit and we concluded there were no indicators of impairment
that existed.

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Mascus reporting unit goodwill


For the year ended December 31, 2021, we performed a quantitative assessment of
the Mascus reporting unit using an income approach based on discounted cash
flows. The fair value of the Mascus reporting unit was measured based on the
present value of the cash flows that we expect the reporting unit to generate.
In determining our future cash flows, we estimated an annual revenue growth rate
ranging between 6% to 10% and an operating margin ranging between 57% to 62%
from 2022 to 2026. We estimated a discount rate of 15.5% reflecting the risk
premium on this reporting unit, and a terminal growth rate of 3.5% for the
period beyond five years. As the fair value of the Mascus reporting unit was
greater than its carrying amount, we concluded that Mascus goodwill was not
impaired at December 31, 2021.

Rouse reporting unit goodwill


For the year ended December 31, 2021, we performed a quantitative assessment of
the Rouse reporting unit using an income approach based on discounted cash
flows. The fair value of the Rouse reporting unit was measured based on the
present value of the cash flows that we expect the reporting unit to generate.
In determining our future cash flows, we estimated an annual revenue growth rate
ranging between 4% to 14% and an operating margin ranging between 40% to 51%
from 2022 to 2031. We estimated a discount rate of 11% reflecting the risk
premium on this reporting unit, and a terminal growth rate of 3.5% for the
period beyond five years. As the fair value of the Rouse reporting unit was
greater than its carrying amount, we concluded that Rouse goodwill was not
impaired at December 31, 2021.

SmartEquip reporting unit goodwill

For the year ended December 31, 2021, we performed a qualitative assessment of
the SmartEquip reporting unit and concluded there were no indicators of
impairment that existed. There were no events and circumstances that occurred
between the acquisition date and December 31, 2021 that indicated any potential
of impairment.

Indefinite-lived intangible assets


Indefinite-lived intangible assets are tested at least annually for impairment,
and between annual tests if indicators of potential impairment exist. To test
our indefinite-lived intangible assets for impairment we first perform a
qualitative assessment to determine if it is more likely than not that the
carrying amount of our indefinite-lived intangible assets exceeds its fair
value. If it is, a quantitative assessment is required. Based on our qualitative
assessment, we determined there were no potential indicators of impairment of
our indefinite-lived intangible assets at December 31, 2021.

Long-lived assets


We test long-lived assets, including amortizable intangible assets, for
impairment whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. For the purpose of impairment testing,
long-lived assets are grouped and tested for recoverability at the lowest level
that generates independent cash flows. Our assessment concluded that the
carrying amounts of our long-lived assets are recoverable as at December 31,
2021.

Recoverability of trade receivables

Our trade receivables are generally secured by the equipment. Refer to Note 13
of the financial statements, Trade Receivables, regarding the activity in the
allowance for expected credit losses.

Valuation of inventories

Inventory consists of equipment and other assets purchased for resale in an
upcoming on site auction or online marketplace events. We typically purchase
inventory for resale through a competitive process where the consignor or vendor
has determined this to be the preferred method of disposition through the
auction process. We value our Inventory at the lower of cost and net realizable
value where net realizable value represents the expected sale price upon
disposition less make-ready costs and the costs of disposal and transportation.

For the year ended December 31, 2021, we reviewed our Inventory to ensure that
it is recorded at the lower of cost and net realizable value. Refer to Note 14
of the financial statements, Inventory, regarding the activity in inventory
write-downs.

Share-based compensation

We measure the fair value of equity-classified share units as of the grant date.
We calculate the fair value of stock options on the grant date using the
Black-Scholes option pricing model. We calculate the fair value of share units
without market conditions on the grant date based on the Company's share price.
We determine the fair value of share units with market conditions using the
Monte Carlo simulation model. The fair value of awards expected to vest is
expensed over the respective remaining service period, with the

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corresponding increase to APIC recorded in equity. Estimating fair value for
share-based payment transactions requires determination of the most appropriate
valuation model, which is dependent on the terms and conditions of the grant.
This estimate may require determination of the most appropriate inputs to the
valuation model, including the expected life of the share units or stock
options, volatility and dividend yield, as well as making assumptions about
them.

Accounting for income taxes


Income taxes are accounted for using the asset and liability method. Deferred
income tax assets and liabilities are based on temporary differences
(differences between the accounting basis and the tax basis of the assets and
liabilities) and non-capital loss, capital loss, and tax credit carry-forwards.
These are measured using the enacted tax rates and laws expected to apply when
these differences reverse. Deferred tax benefits, including non-capital loss,
capital loss, and tax credits carry-forwards, are recognized to the extent that
realization of such benefits is considered more likely than not.

Liabilities for uncertain tax positions are recorded based on a two-step
process. The first step is to evaluate the tax position for recognition by
determining if the weight of available evidence indicates that it is more likely
than not that the position will be sustained on audit, including resolution of
related appeals or litigation processes, if any. The second step is to measure
the tax benefit as the largest amount that is more than 50% likely of being
realized upon settlement. We regularly assess the potential outcomes of
examinations by tax authorities in determining the adequacy of our provision for
income taxes. We also continually assess the likelihood and amount of potential
adjustments and adjust the income tax provision, income taxes payable and
deferred taxes in the period in which the facts that give rise to a revision
become known.

Adoption of New Standards

Topic 805


Effective October 1, 2021, we have early adopted ASU 2021-08, Business
Combinations (Topic 805): Accounting for Contract Assets and Contract
Liabilities from Contracts with Customers. The update primarily addresses the
accounting for contract assets and contract liabilities from revenue contracts
with customers acquired in a business combination. An entity that early adopts
in an interim period should apply the amendments (1) retrospectively to all
business combinations for which the acquisition date occurs on or after the
beginning of the fiscal year that includes the interim period of early
application and (2) prospectively to all business combinations that occur on or
after the date of initial application. We have applied the amendments to the
SmartEquip acquisition, which was completed on November 2, 2021.

Topic 326


Effective January 1, 2020, we adopted Topic 326, Measurement of Credit Losses on
Financial Instruments, which replaces the 'incurred loss methodology' credit
impairment model with a new forward-looking methodology that reflects expected
credit losses and requires consideration of a broader range of reasonable and
supportable information to inform credit loss estimates. The adoption of the
standard had no material effect on the carrying values of our financial assets
on the transition date. Periods prior to January 1, 2020 that are presented for
comparative purposes have not been adjusted.

Topic 848


Effective January 1, 2020, we adopted Topic 848, Facilitation of the Effects of
Reference Rate Reform on Financial Reporting, and in March 2020, the FASB issued
an update to the standard. The standard provides relief for companies preparing
for the discontinuation of reference rates such as LIBOR. This guidance is
effective March 12, 2020 through to December 31, 2022. The adoption of the ASU
and the recent updates have not and are not expected to have a material impact
on our consolidated financial statements.

Topic 842

Effective January 1, 2019, we adopted ASU No. 2016-02, Leases (Topic 842). Refer
to Note 25 of the financial statements, Leases, for a discussion of our lease
accounting.

Other
In addition, effective January 1, 2020, we adopted ASU 2018-15, Intangibles -
Goodwill and Other Internal-Use Software (Subtopic 350-40), Customer's
Accounting for implementation Costs Incurred in a Cloud Computing Arrangement
That Is a Service Contract on a prospective basis. The adoption of ASU 2018-15
on January 1, 2020 using the prospective transition approach did not result in a
material impact to the consolidated financial statements.

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For a discussion of our new and amended accounting standards refer to Note 2 of
the financial statements, Summary of significant accounting policies.

Recent Accounting Pronouncements

Recent accounting pronouncements that significantly impact our accounting
policies or the presentation of our consolidated financial position or
performance have been disclosed in the notes to our consolidated financial
statements included in “Part II, Item 8: Financial Statements and Supplementary
Data” presented elsewhere in this Annual Report on Form 10-K.

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Non-GAAP Measures

We reference various non-GAAP measures throughout this Annual Report on
Form 10-K. These measures do not have a standardized meaning and are, therefore,
unlikely to be comparable to similar measures presented by other companies. The
presentation of this financial information, which is not prepared under any
comprehensive set of accounting rules or principles, is not intended to be
considered in isolation of, or as a substitute for, the financial information
prepared and presented in accordance with generally accepted accounting
principles. Non-GAAP financial measures referred to in this report are labeled
as "non-GAAP measure" or designated as such with an asterisk (*).

Non-GAAP Adjusted Operating Income* Reconciliation


We believe that non-GAAP adjusted operating income* provides useful information
about the growth or decline of our operating income for the relevant financial
period and eliminates the financial impact of adjusting items we do not consider
to be part of our normal operating results.

Adjusting operating income* eliminates the financial impact of adjusting items
which are significant recurring and non-recurring items that we do not consider
to be part of our normal operating results, such as share-based payments
expense, acquisition-related costs, amortization of acquired intangible assets,
management reorganization costs, and certain other items, which we refer to as
'adjusting items'.

In 2021, we updated the calculation of non-GAAP adjusted operating income* to
add-back share-based payments expense, all acquisition-related costs (including
any share based continuing employment costs recognized in acquisition-related
costs), amortization of acquired intangible assets, and gain or loss on
disposition of property, plant and equipment. We have also adjusted for certain
non-recurring advisory, legal and restructuring costs and the change in fair
value of derivatives. These adjustments in 2021 have been applied
retrospectively to all periods presented, as applicable.

The following table reconciles non-GAAP adjusted operating income to operating
income, which is the most directly comparable GAAP measure in our consolidated
income statements.

                                                            Year ended December 31,
                                                                                        % Change
                                                                                 2021 over    2020 over
(in U.S. $000's, except percentages)        2021         2020         2019         2020         2019
Operating income                          $ 240,147    $ 263,160    $ 223,202          (9) %         18 %
Share-based payments expense                 23,106       21,882       16,405            6 %         33 %
Acquisition-related costs                    30,197        6,014          777          402 %        674 %
Amortization of acquired intangible
assets                                       27,960       21,098       20,638           33 %          2 %
Gain on disposition of property,
plant and equipment                         (1,436)      (1,559)      (1,107)          (8) %         41 %
Non-recurring advisory, legal and
restructuring costs                           3,497        3,919           

– (11) % 100 %
Non-GAAP adjusted operating income* $ 323,471 $ 314,514 $ 259,915

            3 %         21 %


(1) Please refer to pages 65-66 for a summary of adjusting items during the years

ended December 31, 2021, 2020, and 2019.

(2) Non-GAAP adjusted operating income* represents operating income excluding the

effects of adjusting items.

Non-recurring advisory, legal and restructuring costs include $1.4 million of

terminated and ongoing transaction and legal costs relating to mergers and

acquisition activity, $1.6 million of SOX remediation costs relating to our
(3) efforts to remediate the material weaknesses identified in 2020, and $0.5

million of advisory costs relating to a cybersecurity incident detected in Q4

2021. In addition, we have reclassified severance costs incurred in 2020 as

non-recurring advisory, legal and restructuring costs.


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Non-GAAP Adjusted Net Income Attributable to Stockholders* and Non-GAAP Diluted
Adjusted EPS Attributable to Stockholders* Reconciliation

We believe that non-GAAP adjusted net income attributable to stockholders*
provides useful information about the growth or decline of our net income
attributable to stockholders for the relevant financial period and eliminates
the financial impact of adjusting items we do not consider to be part of our
normal operating results. Non-GAAP diluted Adjusted EPS attributable to
stockholders* eliminates the financial impact of adjusting items which are
after-tax effects of significant non-recurring or recurring items that we do not
consider to be part of our normal operating results, such as share-based
payments expense, acquisition-related costs, amortization of acquired intangible
assets, management reorganization costs, and certain other items, which we refer
to as 'adjusting items'.

In 2021, we updated the calculation of non-GAAP diluted adjusted EPS
attributable to stockholders* to add-back share-based payments expense and all
acquisition-related costs (including any share based continuing employment costs
recognized in acquisition-related costs), amortization of acquired intangible
assets, and gain or loss on disposition of property, plant and equipment. We
have also adjusted for certain non-recurring advisory, legal and restructuring
costs and the change in fair value of derivatives. These adjustments in 2021
have been applied retrospectively to all periods presented, as applicable.

The following table reconciles non-GAAP adjusted net income attributable to
stockholders* and non-GAAP diluted adjusted EPS attributable to stockholders* to
net income attributable to stockholders and diluted EPS attributable to
stockholders, which are the most directly comparable GAAP measures in our
consolidated income statements.


                                                                     Year 

ended December 31,

                                                                                                       % Change
(in U.S. $000's, except share and                                                               2021 over     2020 over
per share data, and percentages)                2021             2020             2019            2020          2019
Net income attributable to
stockholders                                $     151,868    $     170,095    $     149,039           (11) %         14 %
Share-based payments expense                       23,106           21,882           16,405              6 %         33 %
Acquisition-related costs                          30,197            6,014              777            402 %        674 %
Amortization of acquired intangible
assets                                             27,960           21,098           20,638             33 %          2 %
Gain on disposition of property, plant
and equipment                                     (1,436)          (1,559)          (1,107)            (8) %         41 %
Change in fair value of derivatives                 1,248                -                -            100 %          - %
Non-recurring advisory, legal and
restructuring costs                                 3,497            3,919                -           (11) %        100 %
Related tax effects of the above                 (20,334)         (20,544)         (11,783)            (1) %         74 %
Change in uncertain tax provision -
tax effect                                              -            7,755                -          (100) %        100 %
Non-GAAP adjusted net income
attributable to stockholders*               $     216,106    $     208,660    $     173,969              4 %         20 %
Weighted average number of dilutive
shares outstanding                            111,406,830      110,310,984      109,759,123              1 %          1 %

Diluted earnings per share
attributable to stockholders                $        1.36    $        1.54    $        1.36           (12) %         13 %
Non-GAAP diluted adjusted EPS
attributable to Stockholders*               $        1.94    $        1.89    $        1.59              3 %         19 %


(1) Please refer to pages 65-66 for a summary of adjusting items during the years

ended December 31, 2021, 2020, and 2019.

(2) Non-GAAP adjusted net income attributable to stockholders* represents net

income attributable to stockholders excluding the effects of adjusting items.

Non-GAAP diluted adjusted EPS attributable to stockholders* is calculated by
(3) dividing non-GAAP adjusted net income attributable to stockholders*, net of

the effect of dilutive securities, by the weighted average number of dilutive

shares outstanding.

Non-recurring advisory, legal and restructuring costs include $1.4 million of

terminated and ongoing transaction and legal costs relating to mergers and

acquisition activity, $1.6 million of SOX remediation costs relating to our
(4) efforts to remediate the material weaknesses identified in 2020, and $0.5

million of advisory costs relating to a cybersecurity incident detected in Q4

2021. In addition, we have reclassified severance costs incurred in 2020 as

non-recurring advisory, legal and restructuring costs.


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Non-GAAP Adjusted EBITDA*
We believe non-GAAP adjusted EBITDA* provides useful information about the
growth or decline of our net income when compared between different financial
periods. We use non-GAAP adjusted EBITDA as a key performance measure because we
believe it facilitates operating performance comparisons from period to period.

In 2021, we updated the calculation of non-GAAP adjusted EBITDA* to add-back
share-based payments expense and all acquisition-related costs (including any
share based continuing employment costs recognized in acquisition-related
costs), and gain or loss on disposition of property, plant and equipment. We
have also adjusted for certain non-recurring advisory, legal and restructuring
costs and the change in fair value of derivatives. These adjustments in 2021
have been applied retrospectively to all periods presented, as applicable.

The following table reconciles non-GAAP adjusted EBITDA* to net income, which is
the most directly comparable GAAP measure in, or calculated from, our
consolidated income statements:

                                                                 Year ended December 31,
                                                                                             % Change
                                                                                      2021 over     2020 over
(in U.S. $000's, except percentages)            2021         2020         2019          2020          2019
Net income                                    $ 151,854    $ 170,358    $ 149,140           (11) %         14 %
Add: depreciation and amortization
expenses                                         87,889       74,921       70,501             17 %          6 %
Add: interest expense                            36,993       35,568       41,277              4 %       (14) %
Less: interest income                           (1,402)      (2,338)      (3,802)           (40) %       (39) %
Add: income tax expense                          53,378       65,530       41,623           (19) %         57 %
EBITDA                                          328,712      344,039      298,739            (4) %         15 %
Share-based payments expense                     23,106       21,882       16,405              6 %         33 %
Acquisition-related costs                        30,197        6,014          777            402 %        674 %
Gain on disposition of property, plant
and equipment                                   (1,436)      (1,559)      (1,107)            (8) %         41 %
Change in fair value of derivatives               1,248            -            -            100 %          - %
Non-recurring advisory, legal and
restructuring costs                               3,497        3,919            -           (11) %        100 %
Non-GAAP adjusted EBITDA*                     $ 385,324    $ 374,295    $ 314,814              3 %         19 %

(1) Please refer to pages 65-66 for a summary of adjusting items during the years

    ended December 31, 2021, 2020, and 2019.


    Non-GAAP adjusted EBITDA* is calculated by adding back depreciation and

amortization expenses, interest expense, income tax expense, and subtracting
(2) interest income from net income, as well as adding back share-based payments

    expense, acquisition-related costs, and excluding the effects of any
    non-recurring or unusual adjusting items.

Non-recurring advisory, legal and restructuring costs include $1.4 million of

terminated and ongoing transaction and legal costs relating to mergers and

acquisition activity, $1.6 million of SOX remediation costs relating to our
(3) efforts to remediate the material weaknesses identified in 2020, and $0.5

million of advisory costs relating to a cybersecurity incident detected in Q4

2021. In addition, we have reclassified severance costs incurred in 2020 as

non-recurring advisory, legal and restructuring costs.


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Non-GAAP Adjusted Net Debt* and Non-GAAP Adjusted Net Debt*/Non-GAAP Adjusted
EBITDA* Reconciliation


We believe that comparing non-GAAP adjusted net debt*/non-GAAP adjusted EBITDA*
on a trailing 12-month basis for different financial periods provides useful
information about the performance of our operations as an indicator of the
amount of time it would take us to settle both our short and long-term debt. We
do not consider this to be a measure of our liquidity, which is our ability to
settle only short-term obligations, but rather a measure of how well we fund
liquidity. Measures of liquidity are noted under "Liquidity and Capital
Resources".

The following table reconciles non-GAAP adjusted net debt* to debt, non-GAAP
adjusted EBITDA* to net income, and non-GAAP adjusted net debt*/non-GAAP
adjusted EBITDA* to debt/ net income, respectively, which are the most directly
comparable GAAP measures in, or calculated from, our consolidated financial
statements.

                                                        Year ended December 31,
                                                                                   % Change
(in U.S. $millions, except
percentages)                      2021         2020         2019       2021 over 2020    2020 over 2019
Short-term debt                 $     6.1    $    29.1    $     4.7              (79) %             519 %
Long-term debt                    1,737.4        636.7        645.5               173 %             (1) %
Debt                              1,743.5        665.8        650.2               162 %               2 %
Less: long-term term in
escrow                            (933.5)            -            -                 - %               - %
Less: Cash and cash
equivalents                       (326.1)      (278.8)      (359.7)                17 %            (22) %
Non-GAAP adjusted net debt*         483.9        387.0        290.5                25 %              33 %
Net income                      $   151.9    $   170.4    $   149.1              (11) %              14 %
Add: depreciation and
amortization expenses                87.9         74.9         70.5                17 %               6 %
Add: interest expense                37.0         35.6         41.3                 4 %            (14) %
Less: interest income               (1.4)        (2.3)        (3.8)              (40) %            (39) %
Add: income tax expense              53.4         65.5         41.6              (19) %              57 %
EBITDA                              328.8        344.1        298.7               (4) %              15 %
Share-based payments expense         23.1         21.9         16.4                 6 %              34 %
Acquisition-related costs            30.2          6.0          0.8               402 %             674 %
Gain on disposition of
property, plant and equipment       (1.4)        (1.6)        (1.1)              (10) %              41 %
Change in fair value of
derivatives                           1.2            -            -               100 %               - %
Non-recurring advisory, legal
and restructuring costs               3.5          3.9            -              (11) %               - %
Non-GAAP adjusted EBITDA*       $   385.4    $   374.3    $   314.8                 3 %              19 %
Debt/net income                      11.5 x        3.9 x        4.4 x             194 %            (11) %
Non-GAAP adjusted net
debt*/Non-GAAP adjusted
EBITDA*                               1.3 x        1.0 x        0.9 x              21 %              12 %

(1) Please refer to pages 65-66 for a summary of adjusting items during the years

    ended December 31, 2021, 2020, and 2019.


    Non-GAAP adjusted EBITDA* is calculated by adding back depreciation and

amortization expenses, interest expense, income tax expense, and subtracting
(2) interest income from net income, as well as adding back share-based payments

expense, acquisition-related costs, gain/ loss on disposition of property,

plant and equipment, terminated and ongoing transaction costs, and excluding

the effects of any non-recurring or unusual adjusting items.

(3) Non-GAAP adjusted net debt* is calculated by subtracting cash and cash

equivalents from short and long-term debt.

(4) Non-GAAP adjusted net debt*/Non-GAAP adjusted EBITDA* is calculated by

dividing non-GAAP adjusted net debt* by non-GAAP adjusted EBITDA*.

Non-recurring advisory, legal and restructuring costs include $1.4 million of

terminated and ongoing transaction and legal costs relating to mergers and

acquisition activity, $1.6 million of SOX remediation costs relating to our
(5) efforts to remediate the material weaknesses identified in 2020, and $0.5

million of advisory costs relating to a cybersecurity incident detected in Q4

2021. In addition, we have reclassified severance costs incurred in 2020 as

non-recurring advisory, legal and restructuring costs.


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Operating Free Cash Flow* (“OFCF”) Reconciliation


We believe OFCF*, when compared on a trailing 12-month basis to different
financial periods provides an effective measure of the cash generated by our
business and provides useful information regarding cash flows remaining for
discretionary return to stockholders, mergers and acquisitions, or debt
reduction. Our balance sheet scorecard includes OFCF* as a performance metric.
OFCF* is also an element of the performance criteria for certain annual
short-term and long-term incentive awards.

The following table reconciles OFCF* to cash provided by operating activities,
which is the most directly comparable GAAP measure in, or calculated from, our
consolidated statements of cash flows:

                                                                  Year 

ended December 31,

                                                                                           % Change
(in U.S. $ millions, except percentages)     2021        2020       2019       2020 over 2019     2020 over 2019
Cash provided by operating activities       $ 317.6    $  257.9    $ 332.8                  23 %            (23) %
Property, plant and equipment additions         9.8        14.3       13.6                (31) %               5 %
Intangible asset additions                     33.7        28.9       27.4                  17 %               5 %
Proceeds on disposition of property plant
and equipment                                 (1.9)      (16.4)      (5.9)                (88) %             178 %
Net capital spending                        $  41.6    $   26.8    $  35.1                  55 %            (24) %
OFCF*                                       $ 276.0    $  231.1    $ 297.7                  19 %            (22) %

(1) OFCF* is calculated by subtracting net capital spending from cash provided by

    operating activities.


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Non-GAAP Adjusted Net Income Attributable to Stockholders* and ROIC*
Reconciliation

We believe that comparing ROIC* on a trailing 12-month basis for different
financial periods, provides useful information about the after-tax return
generated by our investments.


In 2021, we updated the calculation of non-GAAP diluted adjusted EPS
attributable to stockholders* to add-back share-based payments expense and all
acquisition-related costs (including any share based continuing employment costs
recognized in acquisition-related costs), amortization of acquired intangible
assets, and gain or loss on disposition of property, plant and equipment. These
adjustments in 2021 have been applied retrospectively to all periods presented.
We have also adjusted for certain non-recurring advisory, legal and
restructuring costs and the change in fair value of derivatives.

The following table reconciles non-GAAP adjusted net income attributable to
stockholders* and ROIC* to net income attributable to stockholders and return on
average invested capital which are the most directly comparable GAAP measures
in, or calculated from, our consolidated financial statements:

                                                               Year ended December 31,
                                                                                          % Change
                                                                                   2021 over      2020 over
(in U.S. $millions, except percentages)      2021         2020         2019          2020           2019

Net income attributable to stockholders $ 151.9 $ 170.0 $ 149.0

           (11) %          14 %
Share-based payments expense                    23.1         21.9         16.4              6 %          33 %
Acquisition-related costs                       30.2          6.0          0.8            402 %         674 %
Amortization of acquired intangible
assets                                          28.0         21.1         20.6             33 %           2 %
Gain on disposition of property, plant
and equipment                                  (1.4)        (1.6)        (1.1)           (10) %          41 %
Change in fair value of derivatives              1.2            -            -            100 %           - %
Non-recurring advisory, legal and
restructuring costs                              3.5          3.9            -           (10) %       100.0 %
Related tax effects of the above              (20.3)       (20.5)       (11.8)            (1) %          74 %
Change in uncertain tax provision - tax
effect                                             -          7.8            -          (100) %         100 %
Non-GAAP adjusted net income
attributable to stockholders*              $   216.2    $   211.5    $   176.9              2 %          20 %
Opening long-term debt                     $   636.7    $   645.5    $   711.3            (1) %         (9) %
Ending long-term debt                        1,737.4        636.7        645.5            173 %         (1) %
Less: long-term debt in escrow                 933.5            -            -            100 %           - %

Non-GAAP adjusted ending long-term debt* 803.9 636.7 645.5

             26 %         (1) %
Average long-term debt                       1,187.1        641.1        678.4             85 %         (5) %
Non-GAAP adjusted average long-term
debt*                                          720.3        641.1        678.4             12 %         (5) %
Opening stockholders' equity               $ 1,007.2    $   901.8    $   830.6             12 %           9 %
Ending stockholders' equity                  1,070.7      1,007.2        901.8              6 %          12 %
Average stockholders' equity                 1,039.0        954.5        866.2              9 %          10 %
Average invested capital                   $ 2,226.1    $ 1,595.6    $ 1,544.6             40 %           3 %
Non-GAAP adjusted average invested
capital                                      1,759.3      1,595.6      1,544.6             10 %           3 %

Return on average invested capital               6.8 %       10.7 %        9.6 %        (390) bps       110 bps
Non-GAAP ROIC*                                   9.7 %       13.3 %       

11.5 % (360) bps 180 bps
Non-GAAP ROIC* excluding escrowed debt 12.3 % 13.3 % 11.5 % (100) bps 180 bps

(1) Please refer to pages 65-66 for a summary of adjusting items for the years

ended December 31, 2021, 2020, and 2019.

Return on average invested capital is calculated as net income attributable
(2) to stockholders divided by average invested capital. We calculate average

invested capital as the average long-term debt and average stockholders’

equity over a trailing 12-month period.

(3) ROIC* is calculated as non-GAAP adjusted net income attributable to

stockholders* divided by average invested capital.

The adoption of Leases (Topic 842) requires lessees to recognize almost all
(4) leases, including operating leases, on the balance sheet through a

right-of-use asset and a corresponding lease liability. The lease liability

is not included in the calculation of debt.

Non-recurring advisory, legal and restructuring costs include $1.4 million of

terminated and ongoing transaction and legal costs relating to mergers and

acquisition activity, $1.6 million of SOX remediation costs relating to our
(5) efforts to remediate the material weaknesses identified in 2020, and $0.5

million of advisory costs relating to a cybersecurity incident detected in Q4

2021. In addition, we have reclassified severance costs incurred in 2020 as

non-recurring advisory, legal and restructuring costs.


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Adjusting Items Non-GAAP Measures

In 2021, we began adjusting for the following items that we do not consider to
be part of our normal operating results. These adjustments in 2021 have been
applied retrospectively to all periods presented.

The following describes the nature of these adjusting items recognized:

Share-based payments expense – includes stock option compensation expense, and

? compensation expense for equity classified share units, liability classified

share units, and employer contributions related to our employee share purchase

plan.

Amortization of acquired intangible assets – includes amortization of all

? intangible assets acquired primarily from the acquisitions of IronPlanet, Rouse

and Mascus.

Gain or loss on disposition of property, plant and equipment – includes any

? gain or loss recognized for the difference between the sales proceeds and the

carrying amount of the disposed property, plant and equipment.

The following are additional adjusting items during the year which we do not
consider to be part of our normal operating results.

Additional adjusting items for the year ended December 31, 2021:

Recognized in the fourth quarter of 2021

$14.0 million ($11.6 million after tax, or $0.10 per diluted share) of
? acquisition-related costs related to the acquisitions of Rouse, and SmartEquip

and the proposed acquisition of Euro Auctions.

$1.2 million ($1.1 million after tax, or $0.01 per diluted share) loss due to
? the change in fair value of derivatives to manage our exposure to foreign

currency exchange rate fluctuations on the purchase consideration for the

proposed acquisition of Euro Auctions.

$2.6 million ($1.9 million after tax, or $0.01 per diluted share) of

non-recurring advisory, legal and restructuring costs which include $1.4

million ($1.0 million after tax, or $0.01 per diluted share) of terminated and

ongoing transaction and legal costs relating to mergers and acquisition
? activity, $0.7 million ($0.5 million after tax, or $0.00 per diluted share) of

SOX remediation costs relating to our efforts to remediate the material

weaknesses identified in 2020, and $0.5 million ($0.4 million after tax, or

$0.00 per diluted share) of advisory costs relating to a cybersecurity incident

detected in Q4 2021.

Recognized in the third quarter of 2021

$10.3 million ($8.3 million after tax, or $0.07 per diluted share) of
? acquisition-related costs related to the acquisitions of Rouse, and SmartEquip

and proposed acquisition of Euro Auctions.

$0.7 million ($0.5 million after tax, or $0.00 per diluted share) of
? non-recurring advisory, legal and restructuring costs related to SOX

remediation costs relating to our efforts to remediate the material weaknesses

identified in 2020, which has been retrospectively applied to Q3 2021.

Recognized in the second quarter of 2021

$0.2 million ($0.2 million after tax, or $0.00 per diluted share) of
? non-recurring advisory, legal and restructuring costs related to SOX

remediation costs relating to our efforts to remediate the material weaknesses

identified in 2020, which has been retrospectively applied to Q2 2021.

Recognized in the first quarter of 2021

? There were no adjustment items recognized in the first quarter of 2021.


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Adjusting items for the year ended December 31, 2020:

Recognized in the fourth quarter of 2020

? $5.2 million ($3.9 million after tax, or $0.04 per diluted share) of

acquisition-related costs related to the acquisition of Rouse.

$1.5 million ($0.01 per diluted share) of current income tax expense recognized
? related to an unfavourable adjustment to reflect final regulations published in

Q2 2020 regarding hybrid financing arrangements.

Recognized in the third quarter of 2020

$4.3 million ($3.2 million after tax, or $0.03 per diluted share) of severance

costs related to the realignment of leadership to support the new global
? operations organization, in line with strategic growth priorities led by the

new CEO. These severance costs were reclassified to non-recurring advisory,

legal and restructuring costs in 2021.

Recognized in the second quarter of 2020

$6.2 million ($0.06 per diluted share) in current and deferred income tax
? expense related to an unfavourable adjustment to reflect final regulations

published regarding hybrid financing arrangements.

Recognized in the first quarter of 2020

? There were no adjustment items recognized in the first quarter of 2020.

Adjusting items for the year ended December 31, 2019:

Recognized in the fourth quarter of 2019

$4.1 million ($3.4 million after tax, or $0.03 per diluted share) in
? share-based payment expense recovery related to the departure of our former

CEO.

Recognized in the third quarter of 2019

? There were no adjustment items recognized in the third quarter of 2019.

Recognized in the second quarter of 2019

? There were no adjustment items recognized in the second quarter of 2019.

Recognized in the first quarter of 2019

? There were no adjustment items recognized in the first quarter of 2019.


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