Finning International Inc.: Fireside Chat Takeaways: Not Just Selling Engines—Monetizing the Lifecycle

Research evidence excerpt

Finning International Inc.: Fireside Chat Takeaways: Not Just Selling Engines—Monetizing the Lifecycle

Fireside Chat Takeaways

• Dealer model: FTT operates under a business model with three core tenants: 1)

Population: populate service territories with machines, mining trucks, engines, 2)

Utilization: FTT wants them to be highly utilized (prime power vs. standby power)

creating higher aftermarket services, and 3) Penetration: they want to penetrate

close to those product support opportunities in their territories to get the full value

(e.g., value creation happens in product support).

• “Generational” opportunity in Western Canada: The same fundamental business

rationales and opportunities that exist in Texas also exist in Alberta, Canada. Natural

gas is relatively inexpensive in Alberta given the abundance of natural gas, limited

egress to get it to coastal or tidal water for export, and strong gas networks to

move it around Alberta so individuals are never far away from a major gas

connection. Alberta also has some unique advantages compared to other geographic

locations which include cooler weather conditions, access to land, additional

resources, and lot of access to gas.

• 20GW of interconnection requests: As it relates to data centers in Alberta, the

city has received ~20GW of grid interconnections requests with only 1GW of spare

capacity. This creates a strong pull of demand for behind-the-meter (“BTM”)

opportunities (e.g., turbines, recip engines) which FTT should be a beneficiary. FTT

also benefits across the power generation spectrum by providing standby power and

rental power (e.g., bridging support to support customers power needs until a

stationary solution is in place).

• Prime vs. Standby: Standy recips require less product support than a prime recip.