Wajax Announces 2012 Fourth Quarter Earnings

TSX Symbol: WJX 
                                                                 
(Dollars in       Three Months Ended December 31 Year Ended December 31
millions, except
per share data) 
                2012   2011                      2012     2011      
CONSOLIDATED                                                           
RESULTS 
Revenue           $364.9 $377.2                  $1,466.0 $1,377.1      
                                                                    
Net earnings       $14.2  $16.6                     $65.9    $63.8      
Basic earnings     $0.85  $1.00                     $3.95    $3.84     
per share 


                                                                       

SEGMENTS                                                               

Revenue -         $201.6 $192.3                    $778.5   $685.8     
Equipment

  - Power Systems  $79.0  $95.5                    $332.3   $347.4     

  - Industrial     $85.3  $90.2                    $360.0   $347.5     
  Components

Net Earnings -     $14.0  $14.3                     $56.1    $50.2     
Equipment

  %  margin         6.9%   7.5%                      7.2%     7.3%     

  - Power Systems   $5.0   $7.9                     $26.1    $32.9     

  %  margin         6.3%   8.3%                      7.9%     9.5%     

  - Industrial      $3.6   $5.9                     $22.1    $23.1     
  Components

  % margin          4.2%   6.5%                      6.1%     6.6%     



TORONTO, March 5, 2013 /CNW/ - Wajax Corporation ("Wajax" or the 
"Corporation") today announced its 2012 fourth quarter earnings.

Fourth Quarter Highlights
    --  Consolidated fourth quarter revenue of $364.9 million decreased
        $12.3 million, or 3%, compared to last year, as weakness in the
        western Canadian oil and gas market overshadowed strength in
        the forestry and construction markets.  The Equipment segment's
        revenue increased 5% on stronger demand in the forestry and
        construction markets, particularly in western Canada.  Softness
        in western Canadian oil and gas industry activity was the
        primary cause of declines in revenues for the Power Systems and
        Industrial Components segments of 17% and 5%, respectively.
    --  Net earnings for the quarter were $14.2 million, or $0.85 per
        share, compared to $16.6 million, or $1.00 per share, recorded
        in 2011.  Equipment segment net earnings decreased slightly as
        selling and administrative cost increases more than offset the
        benefit of higher revenue.  Power Systems and Industrial
        Components segment net earnings declined $2.9 million and $2.3
        million, respectively, on lower revenues and gross margins.
    --  Consolidated backlog of $184.1 million at December 31, 2012
        decreased 9% compared to September 30, 2012, on lower customer
        orders in the mining and oil and gas sectors in the Equipment
        and Power Systems segments.
    --  Funded net debt at December 31, 2012 of $173.7 million
        increased $34.4 million compared to September 30, 2012,
        primarily as a result of increases in mining equipment related
        working capital and a total of $10.1 million paid for the
        acquisition of two businesses, Kaman Industrial Technologies,
        Ltd. (discussed below) and Ace Hydraulic Ltd.

On December 7, 2012, Wajax increased the limit of its bank credit facility by 
$75 million, on substantially the same terms and conditions as the existing 
facility. The fully secured facility, due August 12, 2016, is now comprised 
of an $80 million non-revolving term portion and a $220 million revolving term 
portion. The additional borrowing capacity is available to fund future 
growth, including increases in working capital and acquisitions.

On December 31, 2012, Industrial Components acquired the assets of Kaman 
Industrial Technologies, Ltd. ("Kaman Canada"), consisting of six branch 
locations in British Columbia and one branch location in Ontario. The Kaman 
Canada branches are engaged in the distribution of industrial components, with 
annual revenues of approximately $21.0 million. Subsequent to completing the 
acquisition, on February 21, 2013, Industrial Components announced the 
formation of a strategic alliance with Kaman Canada's U.S.-based parent 
corporation, Kaman Industrial Technologies Corporation ("Kaman U.S."), to 
target North American parts-supply contracts. The alliance will operate as 
Sourcepoint Industrial and provide customers with an alternative to country 
based supply agreements. Customers of the alliance will be served through 
Industrial Components' 65 branches across Canada and Kaman U.S.'s more than 
200 customer service centers and five distribution centers across the U.S., 
Mexico and Puerto Rico.

The Corporation declared dividends of $0.27 per share ($3.24 annualized) for 
the months of March and April.

Outlook

In 2012, Wajax achieved another record performance with revenue and earnings 
before tax of $1.47 billion and $89.7 million, respectively. Wajax was 
positively impacted by strong construction and forestry markets across Canada 
in 2012. The oil and gas sector in western Canada remained active in the 
first half of the year, but began to decline in the second half of 2012 as 
deteriorating industry fundamentals in North America resulted in reduced 
customer spending. In particular, this decline affected Power Systems and 
Industrial Components. Mining activity, including in the oil sands, was 
somewhat stronger compared to last year in all segments. Although quoting 
activity remained high at year-end, the Equipment segment saw a reduction in 
mining equipment backlog in the latter part of the year as customers began to 
take a more cautious approach in making commitments to buy equipment.

Looking forward to 2013, Mark Foote, President and CEO, commented, "The 
combined effect of continuing weakness in the oil and gas market, delays in 
mining investment decisions and the loss of the LeTourneau distribution rights 
will create challenges for our growth in 2013. Quoting activity for mining 
remains very active in both Equipment and Power Systems. However, we do not 
expect meaningful improvement in the oil and gas market during 2013. As a 
result, we anticipate a weaker first half of the year relative to 2012. 
Achieving full year earnings that are comparable to 2012 will depend on 
reasonable end market recovery in the second half of 2013."

Wajax Corporation

Wajax is a leading Canadian distributor and service support provider of mobile 
equipment, power systems and industrial components. Reflecting a diversified 
exposure to the Canadian economy, its three distinct core businesses operate 
through a network of 128 branches across Canada. Its customer base spans 
natural resources, construction, transportation, manufacturing, industrial 
processing and utilities.

Wajax will Webcast its Fourth Quarter Financial Results Conference Call. You 
are invited to listen to the live Webcast on Tuesday, March 5, 2013 at 2:30 
p.m. ET. To access the Webcast, enter www.wajax.com and click on the link 
for the Webcast on the Investor Relations page.

Cautionary Statement Regarding Forward Looking Information

This news release contains certain forward-looking statements and 
forward-looking information, as defined in applicable securities laws 
(collectively, "forward-looking statements"). These forward-looking 
statements relate to future events or the Corporation's future performance. 
All statements other than statements of historical fact are forward-looking 
statements. Often, but not always, forward looking statements can be 
identified by the use of words such as "plans", "anticipates", "intends", 
"predicts", "expects", "is expected", "scheduled", "believes", "estimates", 
"projects" or "forecasts", or variations of, or the negatives of, such words 
and phrases or state that certain actions, events or results "may", "could", 
"would", "should", "might" or "will" be taken, occur or be achieved. Forward 
looking statements involve known and unknown risks, uncertainties and other 
factors beyond the Corporation's ability to predict or control which may cause 
actual results, performance and achievements to differ materially from those 
anticipated or implied in such forward looking statements. There can be no 
assurance that any forward looking statement will materialize. Accordingly, 
readers should not place undue reliance on forward looking statements. The 
forward looking statements in this news release are made as of the date of 
this news release, reflect management's current beliefs and are based on 
information currently available to management. Although management believes 
that the expectations represented in such forward-looking statements are 
reasonable, there is no assurance that such expectations will prove to be 
correct. Specifically, this news release includes forward looking statements 
regarding, among other things, our outlook for certain of our key end markets, 
some of the challenges we face in 2013, and our outlook with respect to our 
financial results for the 2013 financial year. These statements are based on 
a number of assumptions which may prove to be incorrect, including, but not 
limited to, assumptions regarding general business and economic conditions, 
the supply and demand for, and the level and volatility of prices for, 
commodities, financial market conditions, including interest rates, the future 
financial performance of the Corporation, our costs, market competition, our 
ability to attract and retain skilled staff, our ability to procure quality 
products and inventory and our ongoing relations with suppliers, employees and 
customers. The foregoing list of assumptions is not exhaustive. Factors 
that may cause actual results to vary materially include, but are not limited 
to, a deterioration in general business and economic conditions, volatility in 
the supply and demand for, and the level of prices for, commodities, 
fluctuations in financial market conditions, including interest rates, the 
level of demand for, and prices of, the products and services we offer, market 
acceptance of the products we offer, termination of distribution or original 
equipment manufacturer agreements, unanticipated operational difficulties 
(including failure of plant, equipment or processes to operate in accordance 
with specifications or expectations, cost escalation, unavailability of 
quality products or inventory, supply disruptions, job action and 
unanticipated events related to health, safety and environmental matters), our 
ability to attract and retain skilled staff and our ability to maintain our 
relationships with suppliers, employees and customers. The foregoing list of 
factors is not exhaustive. The forward-looking statements contained in this 
news release are expressly qualified in their entirety by this cautionary 
statement. The Corporation does not undertake any obligation to publicly 
update such forward-looking statements to reflect new information, subsequent 
events or otherwise unless so required by applicable securities laws. 
Further information concerning the risks and uncertainties associated with 
these forward looking statements and the Corporation's business may be found 
in our Annual Information Form for the year ended December 31, 2012, filed on 
SEDAR.

Management's Discussion and Analysis - 2012

The following management's discussion and analysis ("MD&A") provides a review 
of the consolidated financial condition and results of operations of Wajax 
Corporation ("Wajax" or the "Corporation") for the year ended December 31, 
2012. The following discussion should be read in conjunction with the 
Corporation's Consolidated Financial Statements and accompanying notes. 
Information contained in this MD&A is based on information available to 
management as of March 5, 2013.

Unless otherwise indicated, all financial information within this MD&A is in 
millions of Canadian dollars, except share and per share data. Additional 
information, including Wajax's Annual Report and Annual Information Form, are 
available on SEDAR at www.sedar.com.

Responsibility of Management and the Board of Directors

Management is responsible for the information disclosed in this MD&A and the 
Consolidated Financial Statements and accompanying notes, and has in place 
appropriate information systems, procedures and controls to ensure that 
information used internally by management and disclosed externally is 
materially complete and reliable. Wajax's Board of Directors has approved this 
MD&A and the Consolidated Financial Statements and accompanying notes. In 
addition, Wajax's Audit Committee, on behalf of the Board of Directors, 
provides an oversight role with respect to all public financial disclosures 
made by Wajax, and has reviewed this MD&A and the Consolidated Financial 
Statements and accompanying notes.

Disclosure Controls and Procedures and Internal Control over Financial 
Reporting

Wajax's management, under the supervision of its Chief Executive Officer 
("CEO") and Chief Financial Officer ("CFO"), is responsible for establishing 
and maintaining disclosure controls and procedures ("DC&P") and internal 
control over financial reporting ("ICFR").

As at December 31, 2012, Wajax's management, under the supervision of its CEO 
and CFO, had designed disclosure controls and procedures ("DC&P") to provide 
reasonable assurance that information required to be disclosed by Wajax in 
annual filings, interim filings or other reports filed or submitted under 
applicable securities legislation is recorded, processed, summarized and 
reported within the time periods specified in such securities legislation. 
DC&P are designed to ensure that information required to be disclosed by Wajax 
in annual filings, interim filings or other reports filed or submitted under 
applicable securities legislation is accumulated and communicated to Wajax's 
management, including its CEO and CFO, as appropriate, to allow timely 
decisions regarding required disclosure.

As at December 31, 2012, Wajax's management, under the supervision of its CEO 
and CFO, had designed internal control over financial reporting ("ICFR") to 
provide reasonable assurance regarding the reliability of financial reporting 
and the preparation of financial statements for external purposes in 
accordance with International Financial Reporting Standards ("IFRS"). In 
completing the design, management used the criteria set forth by the Committee 
of Sponsoring Organizations of the Treadway Commission ("COSO") in Internal 
Control - Integrated Framework. With regard to general controls over 
information technology, management also used the set of practices of Control 
Objectives for Information and related Technology ("COBIT") created by the IT 
Governance Institute.

During the year, Wajax's management, under the supervision of its CEO and CFO, 
evaluated the effectiveness and operation of its DC&P and ICFR. This 
evaluation included a risk evaluation, documentation of key processes and 
tests of effectiveness conducted on a sample basis throughout the year. Due 
to the inherent limitations in all control systems, an evaluation of the DC&P 
and ICFR can only provide reasonable assurance over the effectiveness of the 
controls. As a result, DC&P and ICFR are not expected to prevent and detect 
all misstatements due to error or fraud. The CEO and CFO have concluded that 
Wajax's DC&P and ICFR are effective as at December 31, 2012.

There was no change in Wajax's ICFR that occurred during the three months 
ended December 31, 2012 that has materially affected, or is reasonably likely 
to materially affect, Wajax's ICFR.

Wajax Corporation Overview

Wajax's core distribution businesses are engaged in the sale and after-sale 
parts and service support of mobile equipment, power systems and industrial 
components through a network of 128 branches across Canada. Wajax is a 
multi-line distributor and represents a number of leading worldwide 
manufacturers in its core businesses. Its customer base is diversified, 
spanning natural resources, construction, transportation, manufacturing, 
industrial processing and utilities.

Wajax's strategy is to grow earnings in all segments through organic growth 
and tuck-under acquisitions while maintaining a dividend payout ratio of at 
least 75% of earnings. Planned organic growth includes "base business" 
initiatives that are achieved within the normal scope, resources and markets 
of each core business, while "new opportunity" initiatives are organic growth 
opportunities that we see as significant, requiring more effort, planning and 
resources to achieve. Wajax expects to ensure sufficient capital is 
available to meet its growth requirements within a conservative capital 
structure.

Cautionary Statement Regarding Forward-Looking Information

This MD&A contains certain forward-looking statements and forward-looking 
information, as defined in applicable securities laws (collectively, 
"forward-looking statements"). These forward-looking statements relate to 
future events or the Corporation's future performance. All statements other 
than statements of historical fact are forward-looking statements. Often, 
but not always, forward looking statements can be identified by the use of 
words such as "plans", "anticipates", "intends", "predicts", "expects", "is 
expected", "scheduled", "believes", "estimates", "projects" or "forecasts", or 
variations of, or the negatives of, such words and phrases or state that 
certain actions, events or results "may", "could", "would", "should", "might" 
or "will" be taken, occur or be achieved. Forward looking statements involve 
known and unknown risks, uncertainties and other factors beyond the 
Corporation's ability to predict or control which may cause actual results, 
performance and achievements to differ materially from those anticipated or 
implied in such forward looking statements. There can be no assurance that 
any forward looking statement will materialize. Accordingly, readers should 
not place undue reliance on forward looking statements. The forward looking 
statements in this MD&A are made as of the date of this MD&A, reflect 
management's current beliefs and are based on information currently available 
to management. Although management believes that the expectations 
represented in such forward-looking statements are reasonable, there is no 
assurance that such expectations will prove to be correct. Specifically, 
this MD&A includes forward looking statements regarding, among other things, 
our plans for revenue and earnings growth, including planned marketing, 
strategic, operational and growth initiatives and their intended outcomes, our 
plans regarding the expansion of our businesses, our financing and capital 
requirements, our outlook for certain of our key end markets, some of the 
challenges we face in 2013, our outlook with respect to our financial results 
for the 2013 financial year, and our objective with respect to the future 
payment of dividends. These statements are based on a number of assumptions 
which may prove to be incorrect, including, but not limited to, assumptions 
regarding general business and economic conditions, the supply and demand for, 
and the level and volatility of prices for, commodities, financial market 
conditions, including interest rates, the future financial performance of the 
Corporation, our costs, market competition, our ability to attract and retain 
skilled staff, our ability to procure quality products and inventory and our 
ongoing relations with suppliers, employees and customers. The foregoing 
list of assumptions is not exhaustive. Factors that may cause actual results 
to vary materially include, but are not limited to, a deterioration in general 
business and economic conditions, volatility in the supply and demand for, and 
the level of prices for, commodities, fluctuations in financial market 
conditions, including interest rates, the level of demand for, and prices of, 
the products and services we offer, market acceptance of the products we 
offer, termination of distribution or original equipment manufacturer 
agreements, unanticipated operational difficulties (including failure of 
plant, equipment or processes to operate in accordance with specifications or 
expectations, cost escalation, unavailability of quality products or 
inventory, supply disruptions, job action and unanticipated events related to 
health, safety and environmental matters), our ability to attract and retain 
skilled staff and our ability to maintain our relationships with suppliers, 
employees and customers. The foregoing list of factors is not exhaustive. 
Further information concerning the risks and uncertainties associated with 
these forward looking statements and the Corporation's business may be found 
in this MD&A under the heading "Risk Management and Uncertainties" and in our 
Annual Information Form for the year ended December 31, 2012, filed on 
SEDAR. The forward-looking statements contained in this MD&A are expressly 
qualified in their entirety by this cautionary statement. The Corporation 
does not undertake any obligation to publicly update such forward-looking 
statements to reflect new information, subsequent events or otherwise unless 
so required by applicable securities laws. Readers are further cautioned 
that the preparation of financial statements in accordance with IFRS requires 
management to make certain judgments and estimates that affect the reported 
amounts of assets, liabilities, revenues and expenses. These estimates may 
change, having either a negative or positive effect on net earnings as further 
information becomes available, and as the economic environment changes.

Annual Consolidated Results

Year ended December 31                  2012     2011

Revenue                             $1,466.0 $1,377.1

Gross profit                          $301.8   $292.4
Selling and administrative expenses   $207.7   $200.3

Earnings from operating activities     $94.1    $92.1

Finance costs                           $4.4     $4.6

Earnings before income taxes           $89.7    $87.5

Income tax expense                     $23.8    $23.7

Net earnings                           $65.9    $63.8
                                              

Basic earnings per share               $3.95    $3.84
Diluted earnings per share             $3.89    $3.77

Pie Charts - Revenue by Geographic Region
                            2012         2011

Western Canada               54%          54%

Eastern Canada *             27%          29%

Ontario                      19%          17%

* Includes Quebec and the Atlantic provinces.
    Pie Charts - Revenue by Segment
                            2012         2011

Equipment                    53%          50%

Power Systems                23%          25%

Industrial Components        24%          25%
    Pie Charts - EBIT by Segment
                            2012         2011

Equipment                    54%          47%

Power Systems                25%          31%

Industrial Components        21%          22%
    Pie Charts - Revenue by Market
                            2012         2011

Construction                 17%          14%

Industrial/Commercial        14%          16%

Mining                       12%          11%

Oil Sands                    11%          11%

Oil and Gas                  10%          13%

Forestry                     10%           9%

Transportation                9%           9%

Government & Utilities        6%           6%

Metal Processing              5%           4%

Other                         6%           7%

In 2012, Wajax was positively impacted by strong construction markets across 
the country, particularly in western Canada, as demand for equipment sold by 
the Equipment segment increased by approximately 15% year-over-year. Oil and 
gas activity remained strong in the first half of 2012 with increased sales 
over 2011. Oil and gas sector activity in western Canada, however, declined 
in the second half of 2012 as deteriorating industry fundamentals in North 
America resulted in a decline in customer spending. This decline primarily 
affected the Power Systems and Industrial Components segments. Mining 
activity, including the oil sands market, was somewhat stronger compared to 
last year in all segments. Although quoting activity remained high at 
year-end, the Equipment segment saw a reduction in mining equipment backlog in 
the latter part of the year as customers began to take a more cautious 
approach in making commitments to buy equipment. In 2012, Wajax also 
benefited from stronger activity in the forestry and metal processing sectors 
compared to last year.

Revenue
Revenue in 2012 of $1,466.0 million increased 6%, or $88.9 million, from 
$1,377.1 million in 2011. Equipment segment revenue increased 14%, or $92.7 
million, driven by stronger market demand for equipment, primarily in the 
construction and mining markets, and increased parts and service volumes in 
the western Canadian construction market. Power Systems' segment revenue 
decreased 4%, or $15.1 million, as lower volumes to off-highway oil and gas 
customers in western Canada, attributable to lower industry activity, more 
than offset increased power generation equipment sales and the additional four 
months of revenue from the former operations of Harper Power Products Inc. 
("Harper") acquired on May 2, 2011. Segment revenue in Industrial Components 
increased 4%, or $12.5 million, due primarily to higher bearings and power 
transmission parts volumes in all regions and higher fluid power and process 
equipment product and service sales in eastern Canada.

Gross profit
Gross profit increased $9.4 million, or 3%, in 2012 as the positive impact of 
higher volumes compared to last year was partially offset by the negative 
impact of lower gross profit margins. The gross profit margin percentage 
decrease to 20.6% from 21.2% last year was mainly attributable to the mix of 
equipment and parts and service sales compared to last year.

Selling and administrative expenses
Selling and administrative expenses increased $7.4 million in the year. This 
was due primarily to increased personnel and sales related costs and $3.5 
million of additional expenses from the former Harper operation. These 
increases were partially offset by lower annual and mid-term incentive 
accruals. Selling and administrative expenses as a percentage of revenue 
decreased to 14.2% in 2012 from 14.5% in 2011.

Finance costs
Finance costs of $4.4 million decreased $0.2 million compared to 2011. The 
cost of higher funded net debt levels outstanding during the year were more 
than offset by the Corporation's lower cost of borrowing compared to last 
year. Funded net debt includes bank debt, bank indebtedness and obligations 
under finance leases, net of cash. See Non-IFRS Measures section.

Income tax expense
The Corporation's effective income tax rate of 26.5% in 2012 decreased from 
27.1% in 2011 as a result of the impact of reduced statutory income tax rates.

Net earnings
Net earnings for the year ended December 31, 2012 increased $2.1 million to 
$65.9 million, or $3.95 per share, from $63.8 million, or $3.84 per share, in 
2011. The positive impact of higher volumes and lower finance costs more 
than compensated for the lower gross profit margin percentage and increased 
selling and administrative expenses compared to last year.

Comprehensive income
Comprehensive income of $65.4 million for the year ended December 31, 2012 
included net earnings of $65.9 million, offset partially by an other 
comprehensive loss of $0.6 million. The other comprehensive loss was mainly 
attributable to actuarial losses on pension plans of $0.7 million.

Funded net debt
Funded net debt of $173.7 million at December 31, 2012 increased $110.0 
million compared to December 31, 2011. Increases in non-cash operating 
working capital of $114.3 million resulted in negative cash flows from 
operating activities of $39.1 million in 2012. Other uses of cash included 
dividends paid of $50.6 million, investing activities of $16.0 million 
including $10.1 million used for acquisitions in the Industrial Components 
segment, finance lease payments of $2.6 million and debt facility amendment 
costs of $0.6 million. As a result, Wajax's year-end leverage ratio of 1.55 
times increased from last year's ratio of 0.60 times. (This leverage ratio 
is calculated as funded net debt-to-EBITDA. As funded net debt and EBITDA do 
not have standardized meanings prescribed by IFRS, these financial measures 
may not be comparable to similar measures presented by other companies. See 
Non-IFRS Measures section.)

On May 24, 2012 and December 7, 2012, Wajax amended its bank credit facility 
to increase the limit of the facility by $50 million and $75 million 
respectively, on substantially the same terms and conditions as the existing 
facility. The fully secured facility of $300 million, due August 12, 2016, is 
now comprised of an $80 million non-revolving term portion and a $220 million 
revolving term portion.

Dividends
For the twelve months ended December 31, 2012 monthly dividends declared 
totaled $3.10 per share. For the twelve months ended December 31, 2011 
monthly dividends declared totaled $2.14 per share.

Backlog
Consolidated backlog at December 31, 2012 of $184.1 million decreased $83.6 
million, or 31%, from $267.7 million at December 31, 2011 on reductions in all 
segments. Backlog includes the total retail value of customer purchase 
orders for future delivery or commissioning. See the Annual Results of 
Operations section for further backlog detail by segment.

CEO
On March 5, 2012, Mark Foote assumed the role of President and CEO of Wajax, 
and was appointed a director effective March 6, 2012. Mark has extensive 
experience in distribution, supply chain management and logistics. Most 
recently, he served as the President and Chief Executive Officer of Zellers, 
and prior to that, was the President and Chief Merchandising Officer at 
Loblaws Companies. Mark also had a career of more than 20 years at Canadian 
Tire Corporation, including five years as President, Canadian Tire Retail.

Senior Vice President, Human Resources
On September 4, 2012, Katie Hunter was appointed Senior Vice President, Human 
Resources of Wajax. Ms. Hunter has held the position of Vice President, 
Human Resources at various companies in the manufacturing, mining and health 
care sectors and brings extensive experience in human resource management.

Annual Results of Operations

Equipment

For the year ended December 31   2012   2011

Equipment*                     $513.9 $428.0

Parts and service              $264.6 $257.8

Segment revenue                $778.5 $685.8

Segment earnings                $56.1  $50.2
Segment earnings margin          7.2%   7.3%

(1) Includes rental and other revenue.

Revenue by Product Type 2012 versus 2011       

Market                                   2012 2011

Construction                              35%  33%

Mining/Oil sands                          30%  31%

Material Handling                         16%  16%

Forestry                                  12%  13%

Crane & Utility                            7%   7%
    

Revenue increased 14%, or $92.7 million, to $778.5 million in 2012 from $685.8 
million in 2011. Segment earnings increased $5.9 million to $56.1 million in 
2012 compared to $50.2 million in 2011. The following factors contributed to 
the improved results:
    --  Equipment revenue increased $85.9 million compared to last
        year.  Specific year-over-year variances included the
        following:

  o Construction equipment revenue increased $39.4 million mainly as a
    result of market demand which drove higher sales of Hitachi
    excavators and JCB construction equipment, primarily in western
    Canada and Ontario. Sales of Wirtgen road building equipment in
    Ontario also contributed to the increase.  These increases were
    offset partially by declines in eastern Canada due to competitive


pressures.
  o Mining equipment sales increased $23.9 million due primarily to the 


    delivery of three additional LeTourneau loaders.  Excluding the
    LeTourneau product line, which was discontinued in the second
    quarter of 2012, mining sales increased $5.6 million on higher


Hitachi and rotating equipment deliveries.
  o Forestry equipment revenues increased $9.1 million as strength in 
the lumber market led to higher market demand for Tigercat and 
forestry related Hitachi equipment.
  o Material handling equipment revenue increased $8.7 million as 
higher market demand and increased market share resulted in higher 
volumes in all regions.
  o Crane and utility equipment revenue increased $4.8 million 


    attributable to higher crane sales in western and eastern Canada.
    --  Parts and service volumes increased $6.8 million compared to
        last year. Excluding the LeTourneau product line, parts and
        service volumes increased $17.9 million, or 8%, owing to higher
        mining and construction volumes in western Canada.
    --  Segment earnings increased $5.9 million to $56.1 million
        compared to last year.  The positive impact of higher volumes
        outweighed the negative impact of a slightly lower gross profit
        margin and a $5.0 million increase in selling and
        administrative expenses.  The lower gross profit margin
        resulted primarily from a higher proportion of equipment sales
        compared to last year.  Selling and administrative expenses
        increased as higher personnel and sales related expenses and
        additional environmental remediation provisions more than
        offset lower bad debt expenses compared to last year.

Backlog of $82.2 million at December 31, 2012 decreased $64.4 million compared 
to December 31, 2011. Mining equipment backlog declined on a reduction of 
customer orders and the delivery of four LeTourneau loaders during the year. 
In addition, construction sector related backlog is lower as Wajax and 
manufacturers' inventory levels currently allow for timelier product shipments 
to customers.

Effective November 2, 2012, the Equipment segment became the exclusive 
Canadian distributor of Bell articulated dump trucks ("ADT's"). These trucks, 
manufactured by Bell Equipment Limited, are one of the world's leading truck 
lines for construction, quarry and medium duty resource applications and are 
sold in 80 countries. Wajax estimates the annual size of the Canadian ADT 
market to be at least 500 units, or $225 million. Wajax also estimates the 
existing Canadian installed base of trucks manufactured by Bell to be 
approximately 300 units, which is expected to yield an immediate parts and 
service opportunity. The geographic scope and capability of Equipment's 
Canada-wide distribution network were central factors in securing distribution 
rights to this world-class product line.

On October 17, 2011, Wajax announced it had reached an agreement with 
LeTourneau Technologies, Inc. ("LeTourneau") providing for the dealer 
agreement relating to Wajax's distribution of LeTourneau mining equipment and 
parts products in Canada to be discontinued effective April 27, 2012. 
LeTourneau revenue for the twelve months ended December 31, 2012 included 
equipment sales of $25.8 million and parts and service volumes of $12.5 
million and contributed approximately $8.5 million to the Equipment segment's 
earnings.

Wajax Equipment's base business strategic initiatives are centered around a 
continued focus on increasing the market share of its existing key product 
lines, particularly construction and material handling equipment, and 
improving its aftermarket capabilities and contribution across all lines of 
business. The segment intends to grow its mining business by building on its 
leadership position in Hitachi mining shovels through expansion of its mining 
operations across Canada and the introduction of the extended Hitachi mining 
truck line. It will also grow its base business through selected product 
line extensions and tuck-under acquisitions. The segment's new market 
opportunity is to further develop its Rotating Product group's opportunities 
in the Canadian mining market.

During 2012, the segment strengthened its sales organization to better support 
its market share target objectives by restructuring sales staff in eastern 
Canada and Ontario and through the provision of management training and sales 
execution tools. Development of the Rotating Products group and expansion of 
the segment's mining operations infrastructure into eastern Canada and Ontario 
resulted in better than expected sales and provided greater visibility into 
future market opportunities. New product lines announced in 2012 included 
the Hitachi 240 ton mine truck and the Bell ADT.

The focus to further drive the segment's strategy will include the following 
specific initiatives:
    --  The segment will maintain its focus on increasing market share
        in key product lines through continued sales force
        effectiveness improvements including the development of
        in-house training programs and by providing tools to track
        sales lead generation, coverage and performance.
    --  Expansion of the segment's mining operations includes the
        continued development of the required infrastructure and
        organization to sell and service both above ground and
        underground mining products in central and eastern Canada. The
        segment is also actively marketing the 320 ton and new 240 ton
        Hitachi mine trucks across Canada and working with the
        manufacturer to clearly demonstrate the value proposition to
        customers including quality and cost effectiveness.  In
        addition, the segment is working to introduce new underground
        and drilling product lines to provide customers with an
        expanded product and service offering in the future.  Wajax has
        invested in mining equipment inventory, including shovels and
        trucks, to ensure product is available to execute this
        initiative.
    --  The capacity and quality of the service operation's delivery
        structure will be enhanced through a focus on operational
        effectiveness.  This will include service management training
        and stronger benchmarking and key performance indicator ("KPI")
        measurements to identify and market more profitable business
        opportunities.  The segment intends to implement bolt-on
        service management system technologies that will enhance the
        segment's productivity.
    --  The segment will actively market the Bell ADT product line
        through its Canada-wide distribution network by leveraging its
        current construction equipment market position.  As well,
        Equipment intends to capitalize on the immediate parts and
        service opportunity of the existing installed base of trucks in
        Canada manufactured by Bell, which is estimated to be 300
        units.
    --  The recently formed Rotating Products group in Fort McMurray is
        planned to be further developed to maximize the significant
        opportunities in the oil sands market.  The main focus is on
        marketing high quality and cost effective slurry system
        products, parts and services through exclusive vendor
        relationships.  The segment's secondary focus will include the
        provisioning of plant and field service labour and engineering
        expertise to support customer's plant maintenance and field
        service activities.  While currently built around the oil sands
        market in Fort McMurray, this business represents future growth
        opportunities in other major mining market areas such as
        northern Ontario and Quebec.

Power Systems

For the year ended December 31   2012   2011

Equipment*                     $129.0 $160.8

Parts and service              $203.3 $186.6

Segment revenue                $332.3 $347.4

Segment earnings                $26.1  $32.9
Segment earnings margin          7.9%   9.5%

(1) Includes rental and other revenue.
    Revenue by Market 2012 versus 2011       

Market                             2012 2011

Oil & Gas                           26%  34%

On-highway Transportation           25%  23%

Industrial/Commercial               20%  20%

Oil Sands                            7%   6%

Mining                               5%   3%

Other                               17%  14%


Revenue decreased $15.1 million, or 4%, to $332.3 million in 2012 from $347.4 
million in 2011. (Excluding revenue from the former Harper operation, Power 
Systems revenue decreased $27.8 million, or 9%, compared to last year.) 
Segment earnings decreased $6.8 million to $26.1 million in 2012 from $32.9 
million in 2011. The following factors impacted year-over-year revenue and 
earnings: 


    --  Equipment revenue decreased $31.8 million.  The majority of the
        decrease was caused by lower equipment volumes to off-highway
        oil and gas customers, as a result of reduced industry activity
        in western Canada.  Lower power generation equipment volumes in
        eastern Canada and lower marine sector sales also contributed
        to the decline.  These decreases were partially offset by
        increased power generation equipment sales in western Canada.
    --  Parts and service volumes increased $16.7 million compared to
        last year due mainly to an additional four months of revenue in
        2012 from the former Harper operations acquired on May 2, 2011
        and higher power generation parts and service volumes.
    --  Segment earnings decreased $6.8 million compared to last year
        due to the negative impact of lower volumes and a $3.2 million
        increase in selling and administrative expenses.  Gross profit
        margins remained flat year-over-year. Selling and
        administrative expenses increased owing to $3.5 million of
        additional expenses attributable to the former Harper operation
        and higher personnel and sales related costs.  These increases
        were offset by $2.7 million of lower annual incentive accruals.

Backlog of $60.4 million as of December 31, 2012 decreased $15.9 million 
compared to December 31, 2011 predominantly caused by lower oil and gas 
related off-highway orders in western Canada.

The segment's base business strategic initiatives are intended to expand its 
success in off-highway mechanical drive systems while maintaining the 
segment's position in the on-highway parts and service market. It will also 
complete the Canada-wide integration of its three operating units. The 
segment's new market opportunity is to establish Power Systems as one of 
Canada's leaders in commercial electrical power generation ("EPG").

Specifics of the initiatives going forward will include the following:
    --  The segment's off-highway business will expand its aftermarket
        capabilities by adding sales representatives in key markets and
        introducing re-power programs for oil and gas fracturing
        trailers and mining haul trucks.  The segment will also
        leverage product technology advancements by its major suppliers
        to gain market share and focus on marine market opportunities.
    --  The segment's on-highway business will diversify into other
        "higher value" parts and service offerings by leveraging its
        size and footprint to attract National Fleet Accounts.  It will
        also develop its relationship with "Wheel Time", the North
        American distributors' association, to gain purchasing
        efficiencies and access to "all makes" parts offerings.
    --  As part of the segment's integration of its former regional
        business units, within the next three years a common computer
        system platform will be implemented across all three regions of
        Power Systems allowing for cost efficiencies and
        standardization of processes, reporting and KPI measurements.
    --  The primary growth focus of Power Systems is to build its EPG
        business by creating a stand-alone EPG group with a world-class
        team.  The group will leverage Power Systems' national
        footprint and diverse product portfolio.  The EPG market is
        comprised of high growth sectors such as mining and remote
        northern community development, and also has exposure to less
        cyclical sectors such as industrial and commercial markets. 
        The new EPG group will further develop its large project
        capabilities and continue its success in the standby and prime
        diesel, rental and gas markets.  In 2012, a new facility was
        opened in Drummondville to support the Quebec EPG market and to
        provide infrastructure, including engineering, for a national
        integration centre.

Industrial Components

For the year ended December 31   2012   2011

Segment revenue                $360.0 $347.5

Segment earnings                $22.1  $23.1
Segment earnings margin          6.1%   6.6%
    Revenue by Market 2012 versus 2011        

Market                              2012 2011

Industrial/Manufacturing             16%  17%

Mining                               15%  14%

Forestry                             13%  14%

Oil & Gas                            13%  14%

Metal Processing                     12%  11%

Construction                          6%   6%

Food & Beverage                       5%   5%

Transportation                        4%   4%

Other                                16%  15%

Revenue increased $12.5 million, or 4%, to $360.0 million from $347.5 million 
in 2011. Segment earnings decreased $1.0 million to $22.1 million compared to 
$23.1 million in the previous year. The year-over-year changes in revenue 
and earnings were a result of the following factors:
    --  Bearings and power transmission parts sales increased $10.3
        million, or 6%, compared to last year led by higher sales to
        mining, metal processing and construction sector customers
        across all regions.   Improved transportation, food and
        beverage and oil and gas sector sales also contributed to the
        increase. These increases were offset in part by a decline in
        sales to industrial sector customers in eastern Canada.
    --  Fluid power and process equipment products and service revenue
        increased $2.2 million, or 1%, resulting from higher sales to
        metal processing, food and beverage and agriculture sector
        customers.  These increases were offset somewhat by a decline
        in mining sector volumes.
    --  Segment earnings decreased $1.0 million compared to last year. 
        The positive impact of higher volumes was more than offset by
        the negative impact of a slightly lower gross profit margin and
        a $3.4 million increase in selling and administrative
        expenses.  The increase in selling and administrative expenses
        resulted primarily from higher personnel and sales related
        costs, computer system upgrade expenses and professional fees
        related to acquisitions.  These increases were offset by a $1.4
        million reduction in annual incentive accruals compared to last
        year.

Backlog of $41.6 million as of December 31, 2012 decreased $3.2 million 
compared to December 31, 2011 and includes $1 million related to the two 
acquisitions made in the fourth quarter discussed below.

On October 22, 2012, Industrial Components acquired all of the issued and 
outstanding shares of ACE Hydraulic Limited ("ACE"), a hydraulic cylinder 
repair business located in Bathurst, New Brunswick with annual revenues of 
approximately $2.0 million. The consideration for the business was $1.4 
million, subject to post-closing adjustments. The acquisition represents an 
important step towards the segment's strategy of expanding its engineering, 
service and repair capabilities across Canada.

On December 31, 2012, Industrial Components acquired the assets Kaman 
Industrial Technologies, Ltd. ("Kaman Canada"), consisting of six branch 
locations in British Columbia and one branch in Ontario. Kaman Canada is a 
distributor of industrial components with annual revenues of approximately 
$21.0 million. The consideration paid for the assets was $8.7 million, 
subject to post-closing adjustments. The acquisition aligns with the 
segment's strategy of growing all of its lines of business across Canada.

On February 21, 2013, Industrial Components announced it had formed a 
strategic alliance with Kaman Canada's U.S.-based parent company, Kaman 
Industrial Technologies Corporation ("Kaman U.S."). The strategic alliance 
will target North American parts-supply contracts. The alliance will operate 
as Sourcepoint Industrial and will provide customers with an alternative to 
country based supply agreements. Customers of the alliance will be served 
through Industrial Components' 65 branch locations and 13 service centres 
Canada-wide and Kaman U.S.'s more than 200 customer service centers and five 
distribution centers across the U.S., Mexico and Puerto Rico.

Industrial Components' base business strategic initiatives relate to the 
expansion of its branch network through organic growth and acquisitions and 
the continued steps to maximize its operational efficiency in order to 
increase margins and lower its working capital requirements. The new market 
opportunity for the segment is to grow revenue and earnings in its Engineering 
and Repair Services ("ERS") business by capitalizing on its technical and 
engineering capabilities by providing engineered solutions and repair services 
built around its product offering.

Particulars of these initiatives are as follows:
    --  The segment expects to grow its base business revenues with the
        recent acquisition of the Kaman Canada branches and by opening
        bearing and power transmission parts branches in
        under-represented areas in southern Alberta, depending on
        market conditions.  In addition, the recent formation of
        Sourcepoint Industrial alliance with Kaman U.S. will allow
        Industrial Components to jointly bid on North American
        parts-supply contract business.
    --  Industrial Components intends to improve operational
        efficiencies related to its inventory management, supply chain
        and e-commerce capabilities.  Inventory management and supply
        chain process improvements are expected to reduce product
        procurement, distribution and freight costs and lower inventory
        levels.    During 2013, the segment will continue to upgrade
        its e-commerce capability to meet the evolving transactional
        needs of its customers and improve the efficiency of its
        transactions with suppliers.
    --  The segment will continue to leverage its technical expertise,
        product knowledge and customer relationships to expand its
        higher margin ERS business, which complements its core business
        of distributing technical products and repair parts. 
        Engineering design and fabrication services will be expanded to
        offer customized solutions to customers' operational and
        technical challenges.  Capabilities in key centres will be
        expanded to provide customers with additional service offerings
        including shop repair, field repair and reliability services. 
        The recent acquisition of ACE, a hydraulic cylinder repair
        business, represented an important step towards developing the
        ERS business across Canada.

Annual Cash Flows

Cash Flows Used In Operating Activities

For the year ended December 31, 2012, cash flows used in operating activities 
amounted to $39.1 million, compared to $61.3 million generated in the previous 
year. The $100.4 million decrease in operating cash flows was caused by an 
increased use of non-cash operating working capital of $94.1 million, higher 
rental equipment additions of $4.9 million in the Equipment and Power Systems 
segments, decreased other non-current liabilities of $3.9 million, and income 
taxes paid of $2.3 million. This was partially offset by higher cash flows 
from operating activities before changes in non-cash operating working capital 
of $4.8 million.

Changes in operating non-cash working capital in 2012 compared to 2011 include 
the following components:

Changes in non-cash operating                     
working capital *

For the year ended December 31              2012               2011

Trade and other receivables                $17.1              $27.1

Inventories                                $39.0              $35.0

Prepaid expenses                          ($1.0)               $0.6

Accounts payable and accrued               $58.4            ($39.8)
liabilities

Provisions                                  $0.8             ($2.5)

Total                                     $114.3              $20.3

* Cash used in (generated)

Significant components of the changes in non-cash operating working capital 
for the twelve months ended December 31, 2012 are as follows:
    --  Trade and other receivables increased $17.1 million.  A
        significant increase in the Equipment segment, related to a
        large mining equipment delivery and increased sales activity,
        was partially offset by reductions in the Power Systems and
        Industrial Components segments due to lower sales activity in
        the fourth quarter compared to last year.
    --  Inventories increased $39.0 million due principally to a $35.4
        million increase in mining equipment (trucks and shovels) in
        the Equipment segment.
    --  Accounts payable and accrued liabilities decreased $58.4
        million reflecting reductions in the Equipment and Power
        Systems segments.  Reductions in the Equipment segment were
        attributable to lower trade payables and customer deposits
        related to mining equipment.   Decreases in the Power Systems
        segment resulted from lower deferred income and inventory
        related trade payables.  Reductions in annual and mid-term
        incentive accruals also contributed to the decrease.

Overall, the majority of the $114.3 million increase in non-cash operating 
working capital occurred in the Equipment segment where significant 
investments were made in order to better penetrate the mining and construction 
markets. In particular, the Equipment segment increased its mining equipment 
related operating working capital by approximately $75 million attributable to 
higher inventory and accounts receivable levels and reduced trade payables and 
customer deposits. At December 31, 2012, the segment had increased its 
investment in Hitachi mining equipment inventory to $40.5 million, including 
shovels and new mining trucks.

On the consolidated statement of financial position at December 31, 2012, 
Wajax had employed $243.9 million in current assets net of current 
liabilities, exclusive of funded net debt, compared to $165.0 million at 
December 31, 2011. The $78.9 million increase was essentially attributable to 
the $114.3 million increase in non-cash operating working capital as detailed 
above and the ACE and Kaman Canada acquisitions totaling $10.1 million. 
These increases were offset by an increase of $42.0 million in income taxes 
payable and $1.2 million of dividends payable. The increase in income taxes 
payable relates to both the tax on partnership income generated in 2011 which 
was deferred to 2012 and current tax on 2012 income, of which $44.6 million 
was paid on January 31, 2013. See Liquidity and Capital Resources section 
for further detail.

Investing Activities

For the year ended December 31, 2012, Wajax invested $5.7 million in property, 
plant and equipment additions, net of disposals, and $0.2 million in 
intangible asset additions, compared to $5.4 million and $0.7 million for the 
year ended December 31, 2011, respectively. In addition, the Industrial 
Components segment invested a total of $10.1 million during 2012 for the 
acquisition of the shares of ACE on October 22, 2012 and the acquisition of 
the assets of Kaman Canada on December 31, 2012. Investing activities for 
the twelve months ended December 31, 2011 also included $23.2 million of cash 
paid on the acquisition of Harper on May 2, 2011.

Financing Activities

For the year ended December 31, 2012, the Corporation generated $39.3 million 
of cash from financing activities compared to $69.3 million of cash used in 
financing activities in 2011. Financing activities in the year included bank 
debt borrowing of $93.0 million, offset partially by dividends paid to 
shareholders totaling $50.6 million, or $3.03 per share, finance lease 
payments of $2.6 million and debt facility amendment costs of $0.6 million.

Funded net debt of $173.7 million at December 31, 2012 increased $110.0 
million compared to December 31, 2011. Increases in non-cash operating 
working capital of $114.3 million resulted in negative cash flows from 
operating activities of $39.1 million in 2012. Other uses of cash included 
dividends paid of $50.6 million, investing activities of $16.0 million 
including $10.1 million used for the ACE and Kaman Canada acquisitions, 
finance lease payments of $2.6 million and debt facility amendment costs of 
$0.6 million. As a result, Wajax's year-end leverage ratio of 1.55 times 
increased from last year's ratio of 0.60 times. See Non-IFRS Measures 
section.

Selected Annual Information
                                      2012       2011       2010 (1)

Revenue                           $1,466.0   $1,377.1       $1,110.9

Earnings before income taxes         $89.7      $87.5          $53.9

Net earnings                         $65.9      $63.8          $56.4
                                                                    

Basic earnings per share             $3.95      $3.84          $3.39

Diluted earnings per share           $3.89      $3.77          $3.34

Total assets                        $671.9     $589.9         $522.5

Non-current liabilities             $173.2      $99.9          $18.9

Dividends declared per share         $3.10      $2.14              -

Distributions declared per unit          -          -          $3.40

(1) This information has been prepared on the same basis as the 2012
annual audited Consolidated Financial Statements

Revenue in 2012 of $1,466.0 million increased $88.9 million compared to 
2011. The additional four months of revenue in 2012 from the former Harper 
operation accounted for $12.6 million of the increase. Increased equipment 
and parts and service revenue in the Equipment and Industrial Components 
segments more than offset the decline in the Power Systems segment. Revenue in 
2011 of $1,377.1 million increased $266.2 million compared to 2010 due to the 
increased market demand for equipment and parts and service in all segments 
and the Harper acquisition in May 2011 which accounted for $49.3 million of 
the increase.

Earnings before income taxes increased $35.8 million from 2010 to 2012. The 
increase was attributable to the increases in revenue noted above, offset 
somewhat by the negative impact of lower gross profit margins, increased 
selling and administrative expenses and higher finance costs.

Net earnings increased $9.5 million, or $0.56 per share, from 2010 to 2012. 
The $35.8 million increase in earnings before income taxes more than offset 
the $26.3 million increase in income tax expense resulting from the conversion 
from an income fund to a corporation effective January 1, 2011.

The $149.4 million increase in total assets between December 31, 2010 and 
December 31, 2012 included $12.5 million resulting from the acquisitions of 
ACE and Kaman Canada in 2012 and $32.9 million from the acquisition of Harper 
in 2011. The remaining increase of $104.0 million is mainly attributable to 
higher inventories, accounts receivable and rental equipment resulting from 
the higher sales activity throughout 2011 and 2012 and an increased inventory 
investment in the Equipment segment to better penetrate the mining and 
construction markets. These increases were offset partially by a $43.0 million 
reduction in cash from 2010.

Non-current liabilities at December 31, 2012 of $173.2 million increased $73.3 
million from December 31, 2011 as an increase in bank debt to fund higher 
working capital requirements and the ACE and Kaman Canada acquisitions was 
partially offset by a reduction in deferred taxes payable. Non-current 
liabilities at December 31, 2011 of $99.9 million increased $81.0 million from 
December 31, 2010 due primarily to the reclassification of bank debt to 
non-current liabilities as the Corporation renewed its bank facility to 2016, 
and an increase in deferred taxes payable as the partnership income generated 
in 2011 was deferred and not subject to tax until 2012.

Selected Quarterly Information

The following table summarizes unaudited quarterly consolidated financial data 
for the eight most recently completed quarters. This quarterly information 
is unaudited but has been prepared on the same basis as the 2012 annual 
audited Consolidated Financial Statements.
                                 2012                        2011
                   Q4     Q3     Q2     Q1     Q4     Q3     Q2     Q1

Revenue         $364.9 $356.4 $386.6 $358.1 $377.2 $361.9 $334.1 $303.9

Earnings before  $19.3  $21.8  $25.2  $23.3  $22.5  $24.6  $22.4  $18.0
income taxes
                                                    

Net earnings     $14.2  $16.2  $18.5  $17.1  $16.6  $17.9  $16.5  $12.8
                                                    

Net earnings                                                           
per share

  - Basic        $0.85  $0.97  $1.11  $1.03  $1.00  $1.08  $0.99  $0.77

  - Diluted      $0.84  $0.95  $1.09  $1.01  $0.98  $1.06  $0.98  $0.76


Significant seasonal trends in quarterly revenue and earnings have not been 
evident over the last two years. 
A discussion of Wajax's previous quarterly results can be found in Wajax's 
quarterly MD&A reports available on SEDAR at www.sedar.com. 
Liquidity and Capital Resources 
On May 24, 2012 and December 7, 2012, Wajax amended its bank credit facility 
to increase the limit of the facility by $50 million and $75 million 
respectively, to $300 million on substantially the same terms and conditions 
as the existing facility. The $0.6 million cost of amending the facility has 
been capitalized and will be amortized over the remaining term of the 
facility. The terms of the $300 million bank credit facility include the 
following: 


    --  The facility is fully secured, expiring August 12, 2016, and is
        now made up of an $80 million non-revolving term portion and a
        $220 million revolving term portion.
    --  Borrowing capacity is dependent upon the level of inventories
        on-hand and the outstanding trade accounts receivable.
    --  The facility contains customary restrictive covenants including
        limitations on the payment of cash dividends and the
        maintenance of certain financial ratios all of which were met
        as at December 31, 2012. Wajax is restricted from the
        declaration of monthly dividends in the event the Corporation's
        leverage ratio, as defined in the bank credit facility
        agreement, exceeds three times.   The Corporation's interest
        coverage ratio, as defined under the bank credit facility, must
        not be lower than three times.
    --  Borrowings bear floating rates of interest at margins over
        Canadian dollar bankers' acceptance yields, U.S. dollar LIBOR
        rates or prime.  Margins on the facility depend on Wajax's
        leverage ratio at the time of borrowing and range between 1.5%
        and 3.0% for Canadian dollar bankers' acceptances and U.S.
        dollar LIBOR borrowings, and 0.5% and 2.0% for prime rate
        borrowings.

At December 31, 2012, Wajax had borrowed $154.8 million and issued $5.9 
million of letters of credit for a total utilization of $160.7 million of its 
$300 million bank credit facility. At December 31, 2012, borrowing capacity 
under the bank credit facility was equal to $300 million.

Under the terms of the $300 million bank credit facility, Wajax is permitted 
to have additional interest bearing debt of $15 million. As such, Wajax has 
up to $15 million of demand inventory equipment financing capacity with two 
non-bank lenders. The equipment notes payable under the facilities bear 
floating rates of interest at margins over Canadian dollar bankers' acceptance 
yields and U.S. LIBOR rates. Principal repayments are generally due the 
earlier of 12 months from the date of financing and the date the equipment is 
sold. At December 31, 2012 Wajax had no utilization of its interest bearing 
equipment financing facilities.

The Corporation's capital structure is managed such that it maintains a 
relatively low leverage ratio as the Corporation pays dividends to 
shareholders equal to a significant portion of its earnings. In addition, the 
Corporation's tolerance to interest rate risk decreases/increases as the 
Corporation's leverage ratio increases/decreases. The rate of interest on 
the Corporation's funded debt is currently all floating which is outside of 
the Corporation's interest rate risk policy. Management is willing to 
maintain this level of floating rate debt given the low interest rate 
environment. The Corporation's objective is to maintain a leverage ratio 
between 1.5 times and 2.0 times. However, there may be instances where the 
Corporation is willing to maintain a leverage ratio outside the range. See 
Non-IFRS section.

Since its conversion to a corporation on January 1, 2011, Wajax had not made 
any significant income tax payments until January 31, 2013. This is due to 
income tax payments being deferred as a result of its partnership structure. 
On January 31, 2013, Wajax made an income tax payment of $44.6 million. This 
included approximately $23 million of tax on partnership income generated in 
2011 and the balance representing tax on income to be included in 2012 taxable 
income as a result of a change in tax legislation that has effectively removed 
the partnership income deferral benefit. The Corporation also commenced making 
monthly income tax installments in December 2012.

A key strategy of the Equipment segment is to grow its mining business through 
expansion into eastern Canada and the introduction of the new Hitachi mining 
truck. To ensure mining equipment is available to execute its strategy, 
Wajax has purchased certain mining equipment (large excavators and trucks) 
that do not currently have committed purchase orders. As such, since the 
beginning of the year Wajax has increased its investment in Hitachi mining 
equipment inventory by $35.4 million to $40.5 million as at December 31, 2012, 
of which $36.5 million is available to fill future customer purchases. 
Depending on the level of economic activity in the Canadian mining sector, 
Wajax may continue to use its debt facilities to finance a portion of this and 
other mining equipment scheduled to be delivered in 2013.

Wajax's $300 million bank credit facility along with the additional $15 
million of capacity permitted under the bank credit facility should be 
sufficient to meet Wajax's short-term normal course working capital and 
maintenance capital requirements, including the additional mining equipment 
inventory. However, Wajax may be required to access the equity or debt markets 
in order to fund significant acquisitions and growth related working capital 
and capital expenditures.

See the Annual Cash Flows section for further detail.

Contractual Obligations


                                                           After
Contractual Obligations      Total      1 year   1 - 5 years  5 years 
Bank debt                 $    153.0    $      -    $   153.0 $      - 
Operating leases          $     97.0    $   16.7    $    47.0 $   33.3 
Obligations under         $     11.8    $    3.6    $     8.2 $      -
finance leases 
Total                     $    261.8    $   20.3    $   208.2 $   33.3 
The $153.0 million bank debt obligation relates to the long-term portion of 
the term credit facility and excludes current bank indebtedness and letters of 
credit. 
The operating leases relate to contracts entered into for facilities, a 
portion of the long-term lift truck rental fleet in Equipment and office 
equipment. See the Off Balance Sheet Financing section for additional 
information. 
The obligations under finance leases relate to certain vehicles financed under 
finance lease arrangements. The leases have a minimum one year term and are 
extended on a monthly basis thereafter until termination. 
Wajax also has contingent contractual obligations where Wajax has guaranteed 
the resale value of equipment sold ("guaranteed residual value contracts") or 
has guaranteed a portion of customer lease payments ("recourse contracts"). 
These contracts are subject to certain conditions being met by the customer. 
As at December 31, 2012, Wajax had guaranteed $1.2 million of contracts (2011 
- $5.3 million) with commitments arising between 2013 and 2016. The 
commitments made by Wajax in these contracts reflect the estimated future 
value of the equipment, based on the judgment and experience of management. 
Wajax has recorded a $0.1 million provision in 2012 (2011 - $0.1 million) as 
an estimate of the financial loss likely to result from such commitments. 
The above table does not include obligations to fund pension benefits. Wajax 
sponsors certain defined benefit plans that cover executive employees, a small 
group of inactive employees and employees on long-term disability benefits. 
The defined benefit plans are subject to actuarial valuations in 2014 and 
2015. Management does not expect future cash contribution requirements to 
change materially from the 2012 contribution level of $1.3 million as a result 
of these valuations or any declines in the fair value of the defined benefit 
plans' assets. 
Financial Instruments 
Wajax uses derivative financial instruments in the management of its foreign 
currency and interest rate exposures. Wajax's policy is not to utilize 
derivative financial instruments for trading or speculative purposes. 
Significant derivative financial instruments outstanding at the end of the 
year were as follows: 


              Wajax enters into short-term currency forward contracts
              to hedge the exchange risk associated with the cost of
              certain inbound inventory and certain foreign
              currency-denominated sales to customers along with the
              associated receivables as part of its normal course of
              business.  As at December 31, 2012, Wajax had contracts
              outstanding to buy U.S.$26.5 million and to sell
              U.S.$11.1 million (December 31, 2011 - to buy U.S.$36.0
              million and €0.2 million and to sell U.S.$1.0
              million).  The U.S. dollar contracts expire between
              January 2013 and April 2014, with a weighted average
              U.S./Canadian dollar rate of 0.9959.


Wajax measures derivative instruments not accounted for as hedging items at 
fair value with subsequent changes in fair value being recorded in earnings. 
Derivatives designated as effective hedges are measured at fair value with 
subsequent changes in fair value being recorded in other comprehensive income 
until the related hedged item is recorded and affects income. The fair value 
of derivative instruments is estimated based upon market conditions using 
appropriate valuation models. The carrying values reported in the balance 
sheet for financial instruments are not significantly different from their 
fair values. The impact of a change in foreign currency relative to the 
Canadian dollar on the Corporation's financial statements of unhedged foreign 
currency-denominated sales to customers along with the associated receivables 
and purchases from vendors along with associated payables would be 
insignificant. 
Wajax is exposed to the risk of non-performance by counterparties to 
short-term currency forward contracts. These counterparties are large 
financial institutions with a "Stable" outlook and high short-term and 
long-term credit ratings from Standard and Poor's. To date, no such 
counterparty has failed to meet its financial obligations to Wajax. 
Management does not believe there is a significant risk of non-performance by 
these counterparties and will continue to monitor the credit risk of these 
counterparties. 
Off Balance Sheet Financing 
Off balance sheet financing arrangements include operating lease contracts 
entered into for facilities with various landlords, a portion of the long-term 
lift truck rental fleet in Equipment with a non-bank lender, and office 
equipment with various non-bank lenders. The total obligations for all 
operating leases are detailed in the Contractual Obligations section. At 
December 31, 2012, the non-discounted operating lease commitments for 
facilities totaled $95.6 million, rental fleet $0.8 million, office equipment 
$0.5 million and vehicles $0.1 million. 
Although Wajax's consolidated contractual annual lease commitments decline 
year-by-year, it is anticipated that existing leases will either be renewed or 
replaced, resulting in lease commitments being sustained at current levels. 
In the alternative, Wajax may incur capital expenditures to acquire equivalent 
capacity. 
The Equipment segment had $97.2 million (2011 - $41.5 million) of consigned 
inventory on-hand from a major manufacturer at December 31, 2012. In the 
normal course of business, Wajax receives inventory on consignment from this 
manufacturer which is generally sold to customers or purchased by Wajax. 
This consigned inventory is not included in Wajax's inventory as the 
manufacturer retains title to the goods. In the event the inventory 
consignment program was terminated, Wajax would utilize interest free 
financing, if any, made available by the manufacturer and/or utilize capacity 
under its credit facilities. 
Although management currently believes Wajax has adequate debt capacity, Wajax 
would have to access the equity or debt markets, or temporarily reduce 
dividends to accommodate any shortfalls in Wajax's credit facilities. See 
the Liquidity and Capital Resources section. 
Share Capital 
The shares of Wajax issued are included in shareholders' equity on the balance 
sheet as follows: 
Issued and fully paid Shares as at December 31,      Number  Amount
2012 
Balance at the beginning of the year              16,629,444 $105.4 
Rights exercised                                   107,003    1.3 
Balance at the end of the year                    16,736,447 $106.7 
At the date of this MD&A, the Corporation had 16,736,447 common
shares outstanding. 
Wajax has five share-based compensation plans; the Wajax Share Ownership Plan 
("SOP"), the Deferred Share Program ("DSP"), the Directors' Deferred Share 
Unit Plan ("DDSUP"), the Mid-Term Incentive Plan for Senior Executives 
("MTIP") and the Deferred Share Unit Plan ("DSUP"). SOP, DSP and DDSUP 
rights are issued to the participants and are settled by issuing Wajax 
Corporation shares. The cash-settled MTIP and DSUP consist of annual grants 
that vest over three years and are subject to time and performance vesting 
criteria. A portion of the MTIP and the full amount of the DSUP grants are 
determined by the price of the Corporation's shares. Compensation expense 
for the SOP, DSP and DDSUP is determined based upon the fair value of the 
rights at the date of grant and charged to earnings on a straight line basis 
over the vesting period, with an offsetting adjustment to contributed 
surplus. Compensation expense for the DSUP and the share-based portion of 
the MTIP varies with the price of the Corporation's shares and is recognized 
over the vesting period. Wajax recorded compensation cost of $3.4 million 
for the year (2011 - $5.4 million) in respect of these plans. At December 
31, 2012, 254,952 (2011 - 316,595) rights were outstanding under the SOP, DSP 
and DDSUP. 
Dividends 
Dividends to shareholders for the periods January 1, 2012 to December 31, 2012 
and January 1, 2011 to December 31, 2011 were declared as follows: 
                                    2012                 2011 
Month ((1))                  Per Share   Amount  Per Share    Amount 
January                      $    0.20 $     3.3 $    0.15   $     2.5 
February                          0.20       3.3      0.15         2.5 
March                             0.27       4.5      0.15         2.5 
April                             0.27       4.5      0.15         2.5 
May                               0.27       4.5      0.18         3.0 
June                              0.27       4.5      0.18         3.0 
July                              0.27       4.5      0.18         3.0 
August                            0.27       4.5      0.20         3.3 
September                         0.27       4.5      0.20         3.3 
October                           0.27       4.5      0.20         3.3 
November                          0.27       4.5      0.20         3.3 
December                          0.27       4.5      0.20         3.3 
Total dividends
for the years ended December
31                           $    3.10 $    51.8 $    2.14   $    35.6 
(1) The Corporation's monthly dividends were generally payable to
shareholders of record on the last business day of each calendar month
and were paid on or about the 20(th) day of the following month. 
For the year ending December 31, 2012, Wajax declared dividends to 
shareholders totaling $3.10 per share. For the year ending December 31, 
2011, Wajax declared dividends to shareholders totaling $2.14 per share. 
Dividends paid in 2012 and 2011 were funded from cash generated from operating 
activities. 
The Corporation declared monthly dividends of $0.27 per share, or $4.5 
million, in January, February, March and April of 2013. 
In 2012, the Corporation established an objective of declaring annual 
dividends equal to at least 75% of earnings subject to the Corporation's 
financial condition, economic outlook and capital requirements for growth 
including acquisitions. The Corporation pays dividends on a monthly basis. 
Fourth Quarter Consolidated Results 
For three months ended December 31    2012   2011 
Revenue                             $364.9 $377.2 
Gross profit                         $73.6  $79.3 
Selling and administrative expenses  $53.0  $55.7 
Earnings from operating activities   $20.6  $23.6 
Finance costs                         $1.3   $1.2 
Earnings before income taxes         $19.3  $22.5 
Income tax expense                    $5.1   $5.9 
Net earnings                         $14.2  $16.6 
                                         
Basic earnings per share             $0.85  $1.00 
Diluted earnings per share           $0.84  $0.98 
The Equipment segment was positively impacted in the quarter by increased 
demand for forestry equipment, attributable to higher lumber prices, 
particularly in British Columbia. The Equipment segment also benefitted from 
a somewhat stronger construction market in the quarter compared to last 
year. Weakness in oil and gas sector activity in western Canada, which 
started in the third quarter of 2012, continued in the fourth quarter as 
deteriorating industry fundamentals in North America resulted in a decline in 
customer spending. This decline primarily affected the Power Systems and 
Industrial Components segments. Mining activity, including the oil sands 
market, was somewhat flat compared to last year. Although quoting activity 
remained high at year-end, the Equipment segment saw a reduction in mining 
equipment backlog in the latter part of the year as customers began to take a 
more cautious approach in making commitments to buy equipment. 
Revenue
Revenue in the fourth quarter of 2012 decreased 3%, or $12.3 million, to 
$364.9 million, from $377.2 million in the fourth quarter of 2011. Segment 
revenue increased 5% in Equipment. Segment revenue decreased 17% in Power 
Systems and decreased 5% in Industrial Components due mainly to the lower oil 
and gas sector activity in western Canada. 
Gross profit
Gross profit in the fourth quarter of 2012 decreased $5.7 million due to the 
decrease in volumes and a lower gross profit margin percentage compared to the 
fourth quarter last year. The gross profit margin percentage for the quarter 
of 20.2% declined from 21.0% in the fourth quarter of 2011 due to lower parts 
and service margins offset by the impact of lower equipment revenues compared 
to last year. 
Selling and administrative expenses 
Selling and administrative expenses decreased $2.7 million in the fourth 
quarter of 2012 compared to the same quarter last year. Decreases resulting 
from lower annual and mid-term incentive accruals were offset in part by an 
increase in bad debt expense and environmental remediation provisions compared 
to last year. Selling and administrative expenses as a percentage of revenue 
decreased to 14.5% in the fourth quarter of 2012 from 14.8% compared to the 
same quarter of 2011. 
Finance costs
Quarterly finance costs of $1.3 million increased $0.1 million compared to the 
same quarter last year as the cost of higher funded debt levels outstanding 
during the quarter was mostly offset by the Corporation's lower cost of 
borrowing compared to the same quarter last year. 
Income tax expense
The Corporation's effective income tax rate of 26.3% for the quarter was 
unchanged from the previous year. 
Net earnings
Quarterly net earnings decreased $2.4 million to $14.2 million, or $0.85 per 
share, from $16.6 million, or $1.00 per share, in the same quarter of 2011. 
The impact of reduced volumes, a lower gross profit margin percentage and 
slightly higher finance costs more than offset the lower selling and 
administrative expenses compared to the same quarter last year. 
Comprehensive income
Total comprehensive income of $13.7 million in the fourth quarter of 2012 
included net earnings of $14.2 million, offset partially by an other 
comprehensive loss of $0.5 million. The other comprehensive loss was mainly 
attributable to actuarial losses on pension plans of $0.7 million. 
Funded net debt
Funded net debt of $173.7 million at December 31, 2012 increased $34.4 million 
compared to September 30, 2012. Increases in non-cash operating working 
capital of $25.4 million resulted in negative cash flows from operating 
activities for the quarter of $8.8 million. Other uses of cash included 
dividends paid of $13.6 million, investing activities of $10.7 million 
including $10.1 million used for the ACE and Kaman Canada acquisitions, 
finance lease payments of $0.8 million and debt facility amendment costs of 
$0.3 million. Wajax's leverage ratio of 1.55 times at December 31, 2012 
increased from the September 30, 2012 ratio of 1.22 times. See Non-IFRS 
Measures section. 
Dividends
For the fourth quarter ended December 31, 2012 monthly dividends declared 
totaled $0.81 per share. For the fourth quarter ended December 31, 2011 
monthly dividends declared were $0.60 per share. 
Backlog
Consolidated backlog at December 31, 2012 of $184.1 million decreased $18.3 
million, or 9%, compared to September 30, 2012 due to reductions in the 
Equipment and Power Systems segments. Backlog includes the total retail 
value of customer purchase orders for future delivery or commissioning. See 
the Fourth Quarter Results of Operations section for further backlog detail by 
segment. 
Fourth Quarter Results of Operations 
Equipment 
For three months ended December 31   2012   2011 
Equipment*                         $130.7 $125.4 
Parts and service                   $70.9  $66.9 
Segment revenue                    $201.6 $192.3 
Segment earnings                    $14.0  $14.3 
Segment earnings margin              6.9%   7.5% 
(1) Includes rental and other revenue. 
Revenue in the fourth quarter of 2012 increased $9.3 million, or 5%, to $201.6 
million from $192.3 million in the fourth quarter of 2011. Segment earnings 
for the quarter decreased $0.3 million to $14.0 million compared to the fourth 
quarter of 2011. The following factors contributed to the Equipment 
segment's fourth quarter results: 


    --  Equipment revenue for the fourth quarter increased $5.3 million
        compared to the same quarter last year.  Specific
        quarter-over-quarter variances included the following:

  o Forestry equipment revenues increased $9.0 million resulting from
    higher Tigercat product sales in all regions and increased sales of
    forestry related Hitachi equipment in western Canada on strong


market demand in British Columbia.
  o Construction equipment revenue increased $3.2 million mainly as a 


    result of market demand which drove increased sales of Hitachi
    excavators in western Canada and Ontario, offset partially by lower
    JCB and other equipment sales in eastern Canada owing to lower


demand and competitive market pressures.
  o Crane and utility equipment revenue increased $0.7 million mainly 
attributable to higher new equipment sales to utility customers.
  o Mining equipment sales decreased $7.3 million as Hitachi mining 
equipment deliveries in western Canada were, on average, of a 
smaller size with a lower per unit sales value.
  o Material handling equipment revenue decreased $0.3 million. 


    --  Parts and service volumes for the fourth quarter increased $4.0
        million compared to the same quarter last year. Excluding the
        LeTourneau product line, which was discontinued in the second
        quarter of this year, parts and service volumes for the fourth
        quarter increased $10.2 million, or 17%.  The $10.2 million
        increase was due primarily to higher mining sector volumes in
        western Canada driven by the installed base of Hitachi
        equipment and growth in the Rotating Products Group in Fort
        McMurray.  Increased materials handling sector sales in western
        Canada also contributed to the increase.
    --  Segment earnings for the fourth quarter decreased $0.3 million
        to $14.0 million compared to the same quarter last year.  The
        negative impact of a $2.1 million increase in selling and
        administrative expenses outweighed the positive impact of
        higher volumes.  Selling and administrative expenses increased
        on higher personnel and sales related expenditures and
        additional environmental remediation provisions compared to
        last year.

Backlog of $82.2 million at December 31, 2012 decreased $13.2 million compared 
to September 30, 2012 due largely to lower mining equipment backlog.

Power Systems

For three months ended December 31  2012  2011

Equipment*                         $31.5 $43.9

Parts and service                  $47.5 $51.6

Segment revenue                    $79.0 $95.5

Segment earnings                    $5.0  $7.9

Segment earnings margin             6.3%  8.3%

(1) Includes rental and other revenue.

Revenue in the fourth quarter of 2012 decreased $16.5 million, or 17%, to 
$79.0 million compared to $95.5 million in the same quarter of 2011. Segment 
earnings decreased $2.9 million to $5.0 million in the fourth quarter compared 
to the same quarter in the previous year. The following factors impacted 
quarterly revenue and earnings compared to last year:
    --  Equipment revenue decreased $12.4 million.  The majority of the
        decrease was due to lower equipment sales to off-highway oil
        and gas customers as a result of reduced industry activity in
        western Canada.  These decreases were partially offset by
        increased power generation equipment sales.
    --  Parts and service volumes decreased $4.1 million compared to
        last year as a result of lower sales to off-highway customers
        resulting from reduced activity in western Canada's oil and gas
        sector offset somewhat by higher mining sector sales in eastern
        Canada.  Lower power generation parts and service volumes and
        reduced sales to on-highway customers also contributed to the
        decline.
    --  Segment earnings in the fourth quarter of 2012 decreased $2.9
        million compared to the same quarter last year as the impact of
        reduced volumes and a lower gross profit margin was mitigated
        somewhat by a $2.5 million decrease in selling and
        administrative expenses.  The lower gross profit margin
        resulted from a reduction in both equipment and parts and
        service margins offset by a higher proportion of equipment
        sales compared to last year.  Selling and administrative
        expenses decreased due principally to lower personnel costs,
        including lower annual incentive accruals, and a decline in
        other sales related costs.

Backlog of $60.4 million as of December 31, 2012 decreased $5.1 million 
compared to September 30, 2012 due primarily to reductions in power generation 
and oil and gas sector related backlog in western Canada.

Industrial Components

For three months ended December 31  2012  2011

Segment revenue                    $85.3 $90.2

Segment earnings                    $3.6  $5.9

Segment earnings margin             4.2%  6.5%

Revenue of $85.3 million in the fourth quarter of 2012 decreased $4.9 million, 
or 5%, from $90.2 million in the fourth quarter of 2011. Segment earnings 
decreased $2.3 million to $3.6 million in the fourth quarter compared to the 
same quarter in the previous year. The following factors contributed to the 
segment's fourth quarter results:
    --  Bearings and power transmission parts sales decreased $0.2
        million compared to the same quarter last year.   The impact of
        a reduction in oil and gas sector sales in western Canada and
        lower industrial sector volumes was partially offset by
        improved sales to customers in the transportation, construction
        and food and beverage sectors.
    --  Fluid power and process equipment products and service revenue
        in the fourth quarter of 2012 decreased $4.7 million, or 11%,
        due to lower oil and gas sector sales in western Canada.
    --  Segment earnings in the fourth quarter of 2012 decreased $2.3
        million compared to the same quarter last year due essentially
        to the negative impact of lower volumes and gross profit
        margins in western Canada and a nominal increase in selling and
        administrative expenses.

Backlog of $41.6 million as of December 31, 2012 remain the same compared to 
September 30, 2012 and includes $1 million related to the two acquisitions 
made in the quarter.

Fourth Quarter Cash Flows

Cash Flows Used In Operating Activities

Cash flows used in operating activities amounted to $8.8 million in the fourth 
quarter of 2012, compared to $48.7 million generated in the same quarter of 
the previous year. The $57.5 million decrease was caused by an increased use 
of non-cash operating working capital of $52.0 million, lower cash flows from 
operating activities before changes in non-cash operating working capital of 
$3.1 million, higher income taxes paid of $1.9 million and decreased other 
non-current liabilities of $1.6 million, offset by lower rental equipment 
additions of $1.4 million.

Changes in non-cash operating working capital for the fourth quarter of 2012 
compared to the same quarter in 2011 include the following components:

Changes in non-cash operating working capital*

For three months ended                 2012                      2011
December 31

Trade and other receivables            $6.9                   ($13.8)

Inventories                          ($8.9)                      $9.3

Prepaid expenses                       $0.7                    ($1.5)

Accounts payable and accrued          $29.1                   ($18.8)
liabilities

Provisions                           ($2.4)                    ($1.8)

Total                                 $25.4                   ($26.7)

* Cash used in (generated)


Significant components of the changes in non-cash operating working capital 
for the quarter ended December 31, 2012 are as follows: 


    --  Trade and other receivables increased $6.9 million due
        primarily to higher sales activity in the Equipment segment
        reduced somewhat by lower accounts receivable in the Industrial
        Components segment on lower sales activity.
    --  Inventories decreased $8.9 million due mainly to lower stocking
        levels in Industrial Components and decreases in the Equipment
        segment as reductions in construction equipment were only
        partially offset by an increase in mining equipment.
    --  Accounts payable and accrued liabilities decreased $29.1
        million resulting from lower mining inventory trade payables in
        the Equipment segment.  These decreases were offset in part by
        higher inventory related trade payables in the Industrial
        Components segments.

Included in the $25.4 million increase in non-cash operating working capital, 
was the Equipment segment's additional investment of approximately $34.6 
million in mining equipment related operating working capital attributable to 
higher inventory and reduced trade payables.

On the consolidated statement of financial position at December 31, 2012, 
Wajax had employed $243.9 million of current assets net of current 
liabilities, exclusive of funded net debt, compared to $214.2 million at 
September 30, 2012. The $29.7 million increase was due primarily to the $25.4 
million increase in non-cash operating working capital as detailed above, the 
ACE and Kaman Canada acquisitions less a $2.0 million increase in income taxes 
payable. See Liquidity and Capital Resources section for further detail.

Investing Activities

During the fourth quarter of 2012, Wajax invested $0.6 million in property, 
plant and equipment additions, net of disposals, compared to $2.6 million in 
the fourth quarter of 2011. In addition, the Industrial Components segment 
paid a total of $1.4 million for the acquisition of the shares of ACE on 
October 22, 2012 and $8.7 million for the acquisition of the assets of Kaman 
Canada on December 31, 2012.

Financing Activities

The Corporation generated $15.3 million of cash from financing activities in 
the fourth quarter of 2012 compared to $37.9 million of cash used in financing 
activities in the same quarter of 2011. Financing activities in the quarter 
included bank debt borrowings of $30.0 million, offset by dividends paid to 
shareholders totaling $13.6 million, or $0.81 per share, finance lease 
payments of $0.8 million and debt facility amendment costs of $0.3 million.

Non-IFRS Measures

The MD&A contains certain financial measures that do not have a standardized 
meaning prescribed by IFRS. Therefore, these financial measures may not be 
comparable to similar measures presented by other issuers. Investors are 
cautioned that these measures should not be construed as an alternative to 
profit or to cash flow from operating, investing, and financing activities 
determined in accordance with IFRS as indicators of the Corporation's 
performance. The Corporation's management believes that these measures are 
commonly reported and widely used by investors as an indicator of a company's 
cash operating performance and ability to raise and service debt.

These financial measures are identified and defined below:

Leverage ratio  At the end of a particular quarter, the leverage ratio
                is defined as funded net debt at the end of a
                particular quarter divided by trailing 12-month
                EBITDA.  The Corporation's objective is to maintain
                this ratio between 1.5 times and 2.0 times.

Funded net debt Funded net debt includes bank debt, bank indebtedness
                and obligations under finance leases, net of cash.

EBITDA          Earnings before finance costs, income tax expense,
                depreciation and amortization.

Reconciliation of the Corporations earnings to EBITDA is as follows:
                              For the twelve For the twelve
                               months ended   months ended
                               December 31    September 30
                                2012    2011           2012

Earnings                       $65.9   $63.8          $68.3

Depreciation and amortization   17.8    13.5           16.6

Finance costs                    4.4     4.6            4.3

Income tax expense              23.8    23.7           24.6

EBITDA                        $112.0  $105.6         $113.8


Calculation of the Corporations funded net debt and leverage ratio is as 
follows: 
                               December 31 September 30 
                               2012   2011         2012 
Bank indebtedness (cash)          $10.2 $(5.7)         $6.0 
Obligations under finance leases   11.8   10.3         11.3 
Bank debt                         151.7   59.0        122.0 
Funded net debt                  $173.7  $63.7       $139.3 
                                                        
Leverage ratio                     1.55   0.60         1.22 


    Critical Accounting Estimates

The preparation of the consolidated financial statements in conformity with 
IFRS requires management to make judgements, estimates and assumptions that 
affect the application of accounting policies and the reported amounts of 
assets, liabilities, revenue and expenses. Actual results could differ from 
those judgements, estimates and assumptions. Note 3 to the annual 
Consolidated Financial Statements describes the significant accounting 
policies and methods used in preparation of the annual Consolidated Financial 
Statements. The Corporation bases its estimates on historical experience and 
various other assumptions that are believed to be reasonable in the 
circumstances.

The key assumptions concerning the future and other key sources of estimation 
uncertainty that have a significant risk of resulting in a material adjustment 
to the carrying amount of assets and liabilities within the next fiscal year 
are as follows:

Allowance for doubtful accounts
The Corporation is exposed to credit risk with respect to its trade and other 
receivables. However, this is somewhat minimized by the Corporation's large 
customer base which covers most business sectors across Canada. Wajax follows 
a program of credit evaluations of customers and limits the amount of credit 
extended when deemed necessary. The Corporation maintains provisions for 
possible credit losses, and any such losses to date have been within 
management's expectations. The provision for doubtful accounts is determined 
on an account-by-account basis. The $2.5 million provision for doubtful 
accounts at December 31, 2012 decreased $1.0 million from $3.5 million in 2011 
due to reduction in the Equipment segment. As conditions change, actual 
results could differ from those estimates.

Inventory obsolescence 
The value of the Corporation's new and used equipment is evaluated by 
management throughout the year, on a unit-by-unit basis. When required, 
provisions are recorded to ensure that the book value of equipment is valued 
at the lower of cost or estimated net realizable value. The Corporation 
performs an aging analysis to identify slow moving or obsolete parts 
inventories and estimates appropriate obsolescence provisions related 
thereto. The Corporation takes advantage of supplier programs that allow for 
the return of eligible parts for credit within specified time periods. The 
inventory obsolescence charged to earnings for 2012 was $1.9 million compared 
to $3.2 million in 2011.

Goodwill and intangible assets
The value in use of goodwill and intangible assets has been estimated using 
the forecasts prepared by management for the next three years. The key 
assumptions for the estimate are those regarding revenue growth, gross margin 
and the level of working capital required to support the business. These 
estimates are based on past experience and management's expectations of future 
changes in the market and forecasted growth initiatives. To prepare the 
value in use calculations, the forecasts are extrapolated beyond the three 
year period at the estimated long-term inflation rate (2%) and discounted back 
to present value. The discount rate is based on the Corporation's pre-tax 
weighted average cost of capital of approximately 11% to reflect a market 
participant's view of the cash-generating unit.

During the year, the Corporation performed impairment tests, based on value in 
use, of its goodwill and intangible assets with an indefinite life and 
concluded that no impairment existed in either the goodwill associated with 
any of Wajax's cash-generating units ("CGUs") or the intangible assets with an 
indefinite life.

Warranty provision
The Corporation maintains provisions for possible customer warranty claims 
that may not be covered by the manufacturers' standard warranty and limited 
warranties for workmanship on services provided. The provisions are 
developed using the management's best estimate of actual warranty expense, 
generally based on recent claims experience, and are regularly reviewed and 
adjusted as required.

Changes in Accounting Policy

On January 1, 2012, the Corporation early adopted amendments to International 
Accounting Standard ("IAS") 1 Presentation of Financial Statements: 
Presentation of Items of Other Comprehensive Income. The amendments to IAS 1 
require that an entity present separately the items of other comprehensive 
income that may be reclassified to profit or loss in the future from those 
that would never be reclassified to profit or loss. These amendments are to be 
applied retrospectively in the first annual fiscal period beginning on or 
after July 1, 2012, with early adoption permitted. This new presentation is 
included in the consolidated statements of comprehensive income.

New standards and interpretations not yet adopted 
The new standards or amendments to existing standards that may be significant 
to the Corporation set out below are not yet effective for the year ended 
December 31, 2012 and have not been applied in preparing these consolidated 
financial statements.

As of January 1, 2013, the Corporation will be required to adopt the 
amendments to IFRS 7 Offsetting Financial Assets and Liabilities, which 
contains new disclosure requirements for financial assets and liabilities that 
are offset in the statement of financial position or are subject to master 
netting arrangements or similar arrangements. The Corporation does not 
expect IFRS 7 to have a material impact on its consolidated financial 
statements.

As of January 1, 2013, the Corporation will be required to adopt IFRS 10 
Consolidated Financial Statements, which establishes principles for the 
preparation and presentation of consolidated financial statements when an 
entity controls one or more other entities. The Corporation does not expect 
IFRS 10 to have a material impact on its consolidated financial statements.

As of January 1, 2013, the Corporation will be required to adopt IFRS 13 Fair 
Value Measurement, which defines fair value and sets out a framework for 
measuring fair value when fair value measurements are required or permitted by 
other standards. The Corporation is currently assessing the impact of this 
standard on its consolidated financial statements.

As of January 1, 2013, the Corporation will be required to adopt IAS 19 
Employee Benefits, which requires recognition of actuarial gains and losses 
immediately in other comprehensive income, the full recognition of past 
service costs immediately in profit or loss, recognition of the expected 
return on plan assets in profit or loss to be calculated based on the rate 
used to discount the defined benefit obligation, and certain additional 
disclosures. This standard does not significantly impact the Corporation's 
consolidated financial statements.

As of January 1, 2015, the Corporation will be required to adopt IFRS 9 
Financial Instruments, which is the result of the first phase of the IASB's 
project to replace IAS 39 Financial Instruments: Recognition and Measurement. 
The new standard replaces the current multiple classification and measurement 
models for financial assets and liabilities with a single model that has only 
two classification categories: amortized cost and fair value. The Corporation 
is currently assessing the impact of this standard on its consolidated 
financial statements.

Risk Management and Uncertainties

As with most businesses, Wajax is subject to a number of marketplace and 
industry related risks and uncertainties which could have a material impact on 
operating results and Wajax's ability to pay cash dividends to shareholders. 
Wajax attempts to minimize many of these risks through diversification of core 
businesses and through the geographic diversity of its operations. In 
addition, Wajax has adopted an annual enterprise risk management assessment 
which is prepared by the Corporation's senior management and overseen by the 
Board of Directors and Committees of the Board. The enterprise risk management 
framework sets out principles and tools for identifying, evaluating, 
prioritizing and managing risk effectively and consistently across Wajax.

The following are a number of risks that deserve particular comment:

Manufacturer relationships and product access
Wajax seeks to distribute leading product lines in each of its regional 
markets and its success is dependent upon continuing relations with the 
manufacturers it represents. Wajax endeavours to align itself in long-term 
relationships with manufacturers that are committed to achieving a competitive 
advantage and long-term market leadership in their targeted market segments. 
In the Equipment and Power Systems segments, and in certain cases in the 
hydraulics and process pumps portion of the Industrial Components segment, 
manufacturer relationships are governed through effectively exclusive 
distribution agreements. Distribution agreements are for the most part 
open-ended, but are cancellable within a relatively short notification period 
specified in each agreement. Although Wajax enjoys good relationships with its 
major manufacturers and seeks to develop additional strong long-term 
partnerships, a loss of a major product line without a comparable replacement 
would have a significantly adverse effect on Wajax's results of operations or 
cash flow.

There is a continuing consolidation trend among industrial equipment and 
component manufacturers. Consolidation may impact the products distributed by 
Wajax, in either a favourable or unfavourable manner. Consolidation of 
manufacturers may have a negative impact on the results of operations or cash 
flow if product lines Wajax distributes become unavailable as a result of the 
consolidation. This was the case in the Equipment segment with the 
discontinued distribution of the LeTourneau product line effective April 27 
2012, due to the purchase by Joy Global Inc. of LeTourneau Technologies Inc.

Suppliers generally have the ability to unilaterally change distribution terms 
and conditions or limit supply of product in times of intense market demand. 
Supplier changes in the area of product pricing and availability can have a 
negative or positive effect on Wajax's revenue and margins. As well, from time 
to time suppliers make changes to payment terms for distributors. This may 
affect Wajax's interest-free payment period or consignment terms, which may 
have a materially negative or positive impact on working capital balances such 
as cash, inventories, trade and other payables and bank debt.

Economic conditions/Business cyclicality
Wajax's customer base consists of businesses operating in the natural 
resources, construction, transportation, manufacturing, industrial processing 
and utilities industries. These industries can be capital intensive and 
cyclical in nature, and as a result, customer demand for Wajax's products and 
services may be affected by economic conditions at both a global or local 
level. Changes in interest rates, consumer and business confidence, corporate 
profits, credit conditions, foreign exchange, commodity prices and the level 
of government infrastructure spending may influence Wajax's customers' 
operating, maintenance and capital spending, and therefore Wajax's sales and 
results of operations. Although Wajax has attempted to address its exposure to 
business and industry cyclicality by diversifying its operations by geography, 
product offerings and customer base, there can be no assurance that Wajax's 
results of operations or cash flows will not be adversely affected by changes 
in economic conditions.

Commodity prices
Many of Wajax's customers are directly and indirectly affected by fluctuations 
in commodity prices in the forestry, metals and minerals and petroleum and 
natural gas industries, and as a result Wajax is also indirectly affected by 
fluctuations in these prices. In particular, each of Wajax's businesses is 
exposed to fluctuations in the price of oil and natural gas. A downward change 
in commodity prices, and particularly in the price of oil and natural gas, 
could therefore adversely affect Wajax's results of operations or cash flows.

Growth initiatives, integration of acquisitions and project execution
As part of its long-term strategy, Wajax intends to continue growing its 
business through a combination of organic growth and strategic acquisitions. 
Wajax's ability to successfully grow its business through organic growth will 
be dependent on the segments' achieving their individual base business 
objectives and new opportunities. Wajax's ability to successfully grow its 
business through acquisitions will be dependent on a number of factors 
including: identification of accretive new business or acquisition 
opportunities; negotiation of purchase agreements on satisfactory terms and 
prices; prior approval of acquisitions by third parties, including regulatory 
authorities; securing attractive financing arrangements; and integration of 
newly acquired operations into the existing business. All of these activities 
associated with growing the business, may be more difficult to implement or 
may take longer to execute than management anticipates. Further, any 
significant expansion of the business may increase the operating complexity of 
Wajax, and divert management away from regular business activities. Any 
failure of Wajax to manage its growth strategy, including acquisitions, 
successfully could have a material adverse impact on Wajax's business, results 
of operations or financial condition.

Key personnel
The success of Wajax is largely dependent on the abilities and experience of 
its senior management team and other key personnel. Its future performance 
will also depend on its ability to attract, develop and retain highly 
qualified employees in all areas of its business. Competition for skilled 
management, sales and technical personnel is intense, particularly in certain 
markets where Wajax competes. Wajax continuously reviews and makes 
adjustments to its hiring, training and compensation practices in an effort to 
attract and retain a highly competent workforce. However, there can be no 
assurance that Wajax will be successful in its efforts and a loss of key 
employees, or failure to attract and retain new talent as needed, may have an 
adverse impact on Wajax's current operations or future prospects.

Leverage, credit availability and restrictive covenants
Wajax has a $300 million bank credit facility which expires August 12, 2016 
comprised of a $80 million non-revolving term portion and a $220 million 
revolving term portion. The facility contains restrictive covenants which 
place restrictions on, among other things, the ability of Wajax to encumber or 
dispose of its assets, the amount of interest cost incurred and dividends 
declared relative to earnings and certain reporting obligations. A failure to 
comply with the obligations of the facility could result in an event of 
default which, if not cured or waived, could require an accelerated repayment 
of the facilities. There can be no assurance that Wajax's assets would be 
sufficient to repay the facility in full.

Wajax's short-term normal course working capital requirements can swing widely 
quarter-to-quarter due to timing of large inventory purchases and/or sales and 
changes in market activity. In general, as Wajax experiences growth, there 
is a need for additional working capital as was the case in 2012. 
Conversely, as Wajax experiences economic slowdowns working capital reduces 
reflecting the lower activity levels as was the case in 2009. While 
management believes the bank credit facility will be adequate to meet the 
Corporation's normal course working capital requirements, there can be no 
assurance that additional credit will become available if required, or that an 
appropriate amount of credit with comparable terms and conditions will be 
available when the facility matures.

Wajax may be required to access the equity or debt markets or reduce dividends 
in order to fund significant acquisitions and growth related working capital 
and capital expenditures.

The amount of debt service obligations under the bank credit facility will be 
dependant on the level of borrowings and fluctuations in interest rates to the 
extent the rate is unhedged. As a result, fluctuations in debt servicing costs 
may have a detrimental effect on future earnings or cash flow.

Wajax also has credit lines available with other financial institutions for 
purposes of financing inventory and off balance sheet financing of long-term 
rental fleet. These facilities are not committed lines and their future 
availability cannot be assured, which may have a negative impact on cash 
available for dividends and future growth opportunities.

Quality of products distributed
The ability of Wajax to maintain and expand its customer base is dependent 
upon the ability of the manufacturers represented by Wajax to improve and 
sustain the quality of their products. The quality and reputation of such 
products are not within Wajax's control, and there can be no assurance that 
manufacturers will be successful in meeting these goals. The failure of these 
manufacturers to maintain a market presence could adversely affect Wajax's 
results of operations or cash flow.

Government regulation
Wajax's business is subject to evolving laws and government regulations, 
particularly in the areas of taxation, the environment, and health and safety. 
Changes to such laws and regulations may impose additional costs on Wajax and 
may adversely affect its business in other ways, including requiring 
additional compliance measures by Wajax.

Insurance
Wajax maintains a program of insurance coverage that is ordinarily maintained 
by similar businesses, including property insurance and general liability 
insurance. Although the limits and deductibles of such insurance have been 
established through risk analysis and the recommendation of professional 
advisors, there can be no assurance that such insurance will remain available 
to Wajax at commercially reasonable rates or that the amount of such coverage 
will be adequate to cover all liability incurred by Wajax. If Wajax is held 
liable for amounts exceeding the limits of its insurance coverage or for 
claims outside the scope of that coverage, its business, results of operations 
or financial condition could be adversely affected.

Inventory obsolescence
Wajax maintains substantial amounts of inventories in all three core 
businesses. While Wajax believes it has appropriate inventory management 
systems in place, variations in market demand for the products it sells can 
result in certain items of inventory becoming obsolete. This could result in a 
requirement for Wajax to take a material write down of its inventory balance 
resulting in Wajax not being able to realize expected revenue and cash flows 
from its inventory, which would negatively affect results from operations or 
cash flow.

Information systems and technology
Information systems are an integral part of Wajax's business processes, 
including marketing of equipment and support services, inventory and 
logistics, and finance. Some of these systems are integrated with certain 
suppliers' core processes and systems. Any disruptions to these systems due, 
for example, to the upgrade or conversion thereof, or the failure of these 
systems to operate as expected could, depending on the magnitude of the 
problem, adversely affect Wajax's operating results by limiting the ability to 
effectively monitor and control Wajax's operations.

Credit risk
Wajax extends credit to its customers, generally on an unsecured basis. 
Although Wajax is not substantially dependant on any one customer and it has a 
system of credit management in place, the loss of a large receivable would 
have an adverse effect on Wajax's profitability.

Labour relations
Wajax has approximately 2,833 employees. Wajax is a party to thirteen 
collective agreements covering a total of approximately 410 employees. Of 
these, two collective agreements covering 108 employees expired on or before 
December 31, 2012 and are currently being re-negotiated. Of the remaining 
eleven collective agreements, four expire in 2013, five expire in 2014, and 
two expire in 2015. Overall, Wajax believes its labour relations to be 
satisfactory and does not anticipate it will be unable to renew the collective 
agreements. If Wajax is unable to renew or negotiate collective agreements 
from time to time, it could result in work stoppages and other labour 
disturbances. The failure to renew collective agreements upon satisfactory 
terms could have a material adverse impact on Wajax's businesses, results of 
operations or financial condition.

Foreign exchange exposure
Wajax's operating results are reported in Canadian dollars. While the majority 
of Wajax's sales are in Canadian dollars, significant portions of its 
purchases are in U.S.dollars. Changes in the U.S.dollar exchange rate can 
have a negative or positive impact on Wajax's revenue, margins and working 
capital balances. Wajax mitigates certain exchange rate risks by entering into 
short-term foreign currency forward contracts to fix the cost of certain 
inbound inventory and to hedge certain foreign-currency denominated sales to 
customers. In addition, Wajax will periodically institute price increases to 
offset the negative impact of foreign exchange rate increases on imported 
goods. The inability of Wajax to mitigate exchange rate risks or increase 
prices to offset foreign exchange rate increases, including sudden and 
volatile changes in the U.S. dollar exchange rate, may have a material adverse 
effect on the results of operations or financial condition of Wajax.

A declining U.S.dollar relative to the Canadian dollar can have a negative 
effect on Wajax's revenue and cash flows as a result of certain products being 
imported from the U.S.In some cases market conditions require Wajax to lower 
its selling prices as the U.S.dollar declines. As well, many of Wajax's 
customers export products to the U.S., and a strengthening Canadian dollar can 
negatively impact their overall competitiveness and demand for their products, 
which in turn may reduce product purchases from Wajax.

A strengthening U.S. dollar relative to the Canadian dollar can have a 
positive effect on Wajax's revenue as a result of certain products being 
imported from the U.S. Wajax will periodically institute price increases to 
offset the negative impact of foreign exchange rate increases and volatility 
on imported goods to ensure margins are not eroded.

Wajax maintains a hedging policy whereby significant transactional currency 
risks are identified and hedged.

Competition
The equipment, power systems and industrial components distribution industries 
in which Wajax competes are highly competitive. In the Equipment segment, 
Wajax primarily competes against regional equipment distributors that tend to 
handle a dedicated product line, such as those offered by John Deere, Komatsu 
and Caterpillar. There can be no assurance that Wajax will be able to continue 
to compete on the basis of product quality and price of product lines, 
distribution and servicing capabilities as well as proximity of its 
distribution sites to customers.

The Power Systems business competes with other major diesel engine 
distributors representing such products as Cummins and Caterpillar. 
Competition is based primarily on product quality, pricing and the ability to 
service the product after the sale.

In terms of the Industrial Components segment, the hydraulics and process 
equipment branches compete with other distributors of hydraulics components 
and process equipment on the basis of quality and price of the product lines, 
the capacity to provide custom-engineered solutions and high service 
standards. The bearings and power transmission product branches compete with a 
number of distributors representing the same or competing product lines and 
rely primarily on high service standards, price and value added services to 
gain market advantage.

There can be no assurance that Wajax will be able to continue to effectively 
compete. Increased competitive pressures or the inability of Wajax to maintain 
the factors which have enhanced its competitive position could adversely 
affect its results of operations or cash flow.

Litigation and product liability claims
In the ordinary course of its business, Wajax may be party to various legal 
actions, the outcome of which cannot be predicted with certainty. One category 
of potential legal actions is product liability claims. Wajax carries product 
liability insurance, and management believes that this insurance is adequate 
to protect against potential product liability claims. Not all risks, however, 
are covered by insurance, and no assurance can be given that insurance will be 
consistently available, or will be consistently available on an economically 
feasible basis, or that the amounts of insurance will at all times be 
sufficient to cover each and every loss or claim that may occur involving 
Wajax's assets or operations.

Guaranteed residual value, recourse and buy-back contracts
In some circumstances Wajax makes certain guarantees to finance providers on 
behalf of its customers. These guarantees can take the form of assuring the 
resale value of equipment, guaranteeing a portion of customer lease payments, 
or agreeing to buy back the equipment at a specified price. These contracts 
are subject to certain conditions being met by the customer, such as 
maintaining the equipment in good working condition. Historically, Wajax has 
not incurred substantial losses on these types of contracts, however, there 
can be no assurance that losses will not be incurred in the future. See 
Contractual Obligations section.

Future warranty claims
Wajax provides manufacturers' and/or dealer warranties for most of the product 
it sells. In some cases, the product warranty claim risk is shared jointly 
with the manufacturer. In addition, Wajax provides limited warranties 
for workmanship on services provided. Accordingly, Wajax has some liability 
for warranty claims. There is a risk that a possible product quality erosion 
or a lack of a skilled workforce could increase warranty claims in the future, 
or may be greater than management anticipates. If Wajax's liability in respect 
of such claims is greater than anticipated, it may have a material adverse 
impact on Wajax's business, results of operations or financial condition.

Maintenance and repair contracts
Wajax frequently enters into long-term maintenance and repair contracts with 
its customers, whereby Wajax is obligated to maintain certain fleets of 
equipment at various negotiated performance levels. The length of these 
contracts varies significantly, often ranging up to five or more years. The 
contracts are generally fixed price, although many contracts have additional 
provisions for inflationary adjustments. Due to the long-term nature of these 
contracts, there is a risk that significant cost overruns may be incurred. If 
Wajax has miscalculated the extent of maintenance work required, or if actual 
parts and service costs increase beyond the contracted inflationary 
adjustments, the contract profitability will be adversely affected. In order 
to mitigate this risk, Wajax closely monitors the contracts for early warning 
signs of cost overruns. In addition, the manufacturer may, in certain 
circumstances, share in the cost overruns if profitability falls below a 
certain threshold. Any failure by Wajax to effectively price and manage these 
contracts could have a material adverse impact on Wajax's business, results of 
operations or financial condition.

Environmental factors
From time to time, Wajax experiences environmental incidents, emissions or 
spills in the course of its normal business activities. With the assistance of 
environmental consultants, Wajax has established environmental compliance and 
monitoring programs which management believes are appropriate for its 
operations. To date, these environmental incidents, emissions and spills have 
not resulted in any material liabilities to the Corporation, however, there 
can be no assurance that any future incidents, emissions or spills will not 
result in a material adverse effect on Wajax's results of operations or cash 
flows.

Strategic Direction and Outlook

In 2012 Wajax achieved another record performance with revenue and earnings 
before tax of $1.47 billion and $89.7 million, respectively. Wajax was 
positively impacted by strong construction and forestry markets across Canada 
in 2012. The oil and gas sector in western Canada remained active in the 
first half of the year, but began to decline in the second half of 2012 as 
deteriorating industry fundamentals in North America resulted in reduced 
customer spending. In particular, this decline affected Power Systems and 
Industrial Components. Mining activity, including in the oil sands, was 
somewhat stronger compared to last year in all segments. Although quoting 
activity remained high at year-end, the Equipment segment saw a reduction in 
mining equipment backlog in the latter part of the year as customers began to 
take a more cautious approach in making commitments to buy equipment.

Looking forward to 2013, the combined effect of continuing weakness in the oil 
and gas market, delays in mining investment decisions and the loss of the 
LeTourneau distribution rights will create challenges for growth in 2013. 
Quoting activity for mining remains very active in both Equipment and Power 
Systems. However, Wajax does not expect meaningful improvement in the oil 
and gas market during 2013. As a result, management anticipates a weaker first 
half of the year relative to 2012. Achieving full year earnings that are 
comparable to 2012 will depend on reasonable end market recovery in the second 
half of 2013.

Additional information, including Wajax's Annual Report and Annual Information 
Form, are available on SEDAR at www.sedar.com.

WAJAX CORPORATION

Unaudited Condensed Consolidated Financial Statements

For the three and twelve months ended December 31, 2012

Notice required under National Instrument 51-102, "Continuous Disclosure 
Obligations" Part 4.3(3) (a):

The attached condensed consolidated financial statements have been prepared by 
Management of Wajax Corporation and have not been reviewed by the 
Corporation's auditors.
                                 WAJAX CORPORATION
                        CONDENSED CONSOLIDATED STATEMENTS OF
                                 FINANCIAL POSITION
                                                                   

As at                                           December   December
(unaudited, in thousands of Canadian            31, 2012   31, 2011
dollars)                               Note

ASSETS                                                             

CURRENT                                                            

Cash                                          $        - $    5,659

Trade and other receivables                      194,567    174,233

Inventories                                      285,185    241,524

Prepaid expenses                                   7,089      8,033
                                                 486,841    429,449
                                                                   

NON-CURRENT                                                        

Rental equipment                          4       43,731     28,060

Property, plant and equipment             5       50,700     47,924

Intangible assets                                 87,668     84,493

Deferred taxes                           10        2,922          -
                                                 185,021    160,477
                                              $  671,862 $  589,926
                                                                   

LIABILITIES AND SHAREHOLDERS' EQUITY                               

CURRENT                                                            

Bank indebtedness                             $   10,195 $        -

Accounts payable and accrued                     186,897    245,011
liabilities                                

Provisions                                         7,033      7,851

Dividends payable                                  4,519      3,326

Income taxes payable                              44,349      2,398

Obligations under finance leases                   3,611      3,646

Derivative instruments                               149        208
                                                 256,753    262,440
                                                                   

NON-CURRENT                                                        

Provisions                                         4,088      4,010

Deferred taxes                           10            -     17,694

Employee benefits                                  7,160      6,843

Other liabilities                                  2,083      5,644

Obligations under finance leases                   8,192      6,688

Bank debt                                 6      151,701     59,021
                                                 173,224     99,900
                                                                   

SHAREHOLDERS' EQUITY                                               

Share capital                             7      106,651    105,371

Contributed surplus                                4,346      4,888

Retained earnings                                130,944    117,477

Accumulated other comprehensive loss                (56)      (150)

Total shareholders' equity                       241,885    227,586
                                              $  671,862 $  589,926

These condensed consolidated financial statements were approved by the Board 
of Directors on March 5, 2013.
                                   WAJAX CORPORATION
                         CONDENSED CONSOLIDATED STATEMENTS OF
                                       EARNINGS
                                                                    

(unaudited, in         Three months ended       Twelve months ended
thousands of               December 31              December 31
Canadian dollars,
except per share                     2011         2012        2011
data)             Note     2012
                                                                    

Revenue                $ 364,929 $ 377,182   $ 1,466,014 $ 1,377,100

Cost of sales            291,319   297,850     1,164,199   1,084,667

Gross profit              73,610    79,332       301,815     292,433

Selling and               53,010    55,698       207,672     200,321
administrative
expenses              

Earnings from             20,600    23,634        94,143      92,112
operating
activities            

Finance costs              1,337     1,153         4,442       4,630

Earnings before           19,263    22,481        89,701      87,482
income taxes          

Income tax                 5,069     5,920        23,762      23,679
expense             10

Net earnings           $  14,194 $  16,561   $    65,939 $    63,803
                                                                    

Basic earnings         $    0.85 $    1.00   $      3.95 $      3.84
per share           11

Diluted earnings       $    0.84 $    0.98   $      3.89 $      3.77
per share           11
                                    WAJAX CORPORATION
                          CONDENSED CONSOLIDATED STATEMENTS OF
                                  COMPREHENSIVE INCOME
                                 Three months ended    Twelve months ended


                             December 31            December 31
(unaudited, in thousands of
Canadian dollars)                2012      2011       2012         2011 
                                                                    
Net earnings                 $ 14,194 $  16,561   $ 65,939 $     63,803 
                                                                    
Items that will not be                                                 
reclassified to income 
Actuarial losses on pension                                 
plans, net of tax recovery
of $251 (2011 - $885) and       (683)   (2,544)      (683)      (2,544)
year to date, net of tax
recovery of $251 (2011 -
$885) 
                                                                    
Items that may subsequently                                            
be reclassified to income 
Losses (gains) on                                           
derivative instruments
designated
as cash flow hedges in
prior periods reclassified
to
cost of inventory or              186     (649)        517          565
finance costs during the
period,
net of tax recovery of $66
(2011 - expense of $224)
and year to date, net of
tax recovery of $187 (2011
- $237) 
                                                                    
(Losses) gains on                                           
derivative instruments
outstanding
at the end of the period
designated as cash flow
hedges,                          (42)     (354)      (423)        1,062
net of tax recovery of $15
(2011 - $126) and year to
date,
net of tax recovery of $149
(2011 - expense of $381) 


                                                                       

Other comprehensive loss,       (539)   (3,547)      (589)        (917)
net of tax

Total comprehensive income   $ 13,655 $  13,014   $ 65,350 $     62,886
                                        WAJAX CORPORATION
                              CONDENSED CONSOLIDATED STATEMENTS OF
                                 CHANGES IN SHAREHOLDERS' EQUITY
                                                                             
                                                   Accumulated   
                                                      other
                                                  comprehensive
                                                  (loss) income
                                                    ("AOCL")               

For the                Share Contributed Retained     Cash flow  
twelve months        capital     surplus earnings        hedges
ended
December 31,
2012
(unaudited,
in thousands
of Canadian
dollars)      Note                                                   Total
                                                                          

January 1,         $ 105,371       4,888  117,477         (150) $
2012                                                               227,586
                                                                          

Net earnings               -           -   65,939             -     65,939
                                                                          

Other                      -           -    (683)            94  
comprehensive
loss                                                                 (589)
                                                                          

Total                      -           -   65,256            94  
comprehensive
income for
the period                                                          65,350

Shares issued          1,280     (1,280)        -             -  
to settle
share-based
compensation
plans            9                                                       -

Dividends        8         -           - (51,789)             -   (51,789)

Share-based                -         738        -             -  
compensation
expense          9                                                     738

December 31,       $ 106,651       4,346  130,944          (56) $
2012                                                               241,885
                                        WAJAX CORPORATION
                               CONDENSED CONSOLIDATED STATEMENTS OF
                                 CHANGES IN SHAREHOLDERS' EQUITY
                                                                              
                                                              AOCL            

For the                Share     Trust Contributed Retained    Cash  
twelve months        capital     units     surplus earnings    flow
ended                                                        hedges
December 31,
2011
(unaudited,
in thousands
of Canadian
dollars)      Note                                                       Total
                                                                              

January 1,         $       -   105,371       3,931   91,805 (1,777) $
2011                                                                   199,330
                                                                              

Conversion to        105,371 (105,371)           -        -       -  
corporation                                                                  -
                                                                              

Net earnings               -         -           -   63,803       -     63,803
                                                                              

Other                      -         -           -  (2,544)   1,627  
comprehensive
loss                                                                     (917)
                                                                              

Total                      -         -           -   61,259   1,627  
comprehensive
income for
the period                                                              62,886

Dividends        8         -         -           - (35,587)       -   (35,587)

Share-based                -         -         957        -       -  
compensation
expense          9                                                         957

December 31,       $ 105,371         -       4,888  117,477   (150) $
2011                                                                   227,586
                                    WAJAX CORPORATION
                          CONDENSED CONSOLIDATED STATEMENTS OF
                                       CASH FLOWS
                              Three months ended      Twelve months ended
                               December 31             December 31

(unaudited, in    Note         2012       2011          2012       2011
thousands of
Canadian dollars)

OPERATING                                                              
ACTIVITIES

  Net earnings           $   14,194 $   16,561   $    65,939 $   63,803

  Items not                                                            
  affecting cash
  flow:
    Depreciation                                                       
    and
    amortization
      Rental                  2,404      1,471         7,883      4,838
      equipment
      Property,               2,265      2,035         8,467      7,441
      plant and
      equipment
      Intangible                376        315         1,466      1,216
      assets
    Loss on          5           10         75           139         61
    disposal of
    property,
    plant and
    equipment
    Share rights     9          219      (386)           738        957
    plans
    compensation
    expense
    (income)
    Non-cash                (1,024)      (125)       (1,687)      (303)
    rental
    expense
    Employee                  (633)         46         (618)      (478)
    benefits
    (income)
    expense, net
    of payments
    Non-cash                  (241)          -            72          -
    (gain) loss
    on derivative
    instruments
    Finance costs             1,337      1,153         4,442      4,630
    Income tax      10        5,069      5,920        23,762     23,679
    expense
                             23,976     27,065       110,603    105,844

  Changes in        12     (25,362)     26,655     (114,347)   (20,253)
  non-cash
  operating
  working capital

  Rental            4       (3,583)    (4,996)      (25,076)   (20,177)
  equipment
  additions

  Other                       (562)      1,041       (3,784)         95
  non-current
  liabilities

  Finance costs             (1,377)    (1,011)       (4,118)    (4,132)
  paid

  Income taxes              (1,887)       (18)       (2,387)      (116)
  paid

Cash (used in)              (8,795)     48,736      (39,109)     61,261
generated from
operating
activities
                                                                       

INVESTING                                                              
ACTIVITIES

  Property, plant    5        (586)    (2,682)       (6,234)    (5,499)
  and equipment
  additions

  Proceeds on        5           28         47           523        132
  disposal of
  property, plant
  and equipment

  Intangible                   (32)      (413)         (237)      (664)
  assets
  additions

  Acquisition of    13     (10,078)         10      (10,078)   (23,247)
  businesses

Cash used in               (10,668)    (3,038)      (16,026)   (29,278)
investing
activities
                                                                       

FINANCING                                                              
ACTIVITIES

  Increase           6       30,000   (27,000)        92,998   (20,000)
  (decrease) in
  bank debt

  Debt facility      6        (343)         11         (568)    (1,061)
  amendment
  (costs) income

  Finance lease               (819)      (975)       (2,553)    (3,484)
  payments

  Dividends paid           (13,557)    (9,978)      (50,596)   (44,733)

Cash generated               15,281   (37,942)        39,281   (69,278)
from (used in)
financing
activities
                                                                       

Change in cash              (4,182)      7,756      (15,854)   (37,295)

(Bank                       (6,013)    (2,097)         5,659     42,954
indebtedness)
cash - beginning
of period

(Bank                    $ (10,195) $    5,659   $  (10,195) $    5,659
indebtedness)
cash - end of
period

WAJAX CORPORATION 
NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS

DECEMBER 31, 2012
(unaudited, amounts in thousands of Canadian dollars, except share and per 
share data)

1. COMPANY PROFILE
Wajax Corporation (the "Corporation") is incorporated in Canada. The address 
of the Corporation's registered office is 3280 Wharton Way, Mississauga, 
Ontario, Canada. The Corporation's core distribution businesses are engaged in 
the sale and after-sale parts and service support of equipment, power systems 
and industrial components, through a network of 128 branches across Canada. 
The Corporation is a multi-line distributor and represents a number of leading 
worldwide manufacturers across its core businesses. Its customer base is 
diversified, spanning natural resources, construction, transportation, 
manufacturing, industrial processing and utilities.

2. BASIS OF PREPARATION
Statement of compliance
These condensed consolidated financial statements have been prepared in 
accordance with International Accounting Standard 34 Interim Financial 
Reporting and do not include all of the disclosures required for full 
consolidated financial statements. Accordingly, these condensed consolidated 
financial statements should be read in conjunction with the audited 
consolidated financial statements of Wajax Corporation for the year ended 
December 31, 2011. The significant accounting policies follow those 
disclosed in the most recently reported audited consolidated financial 
statements.

Basis of measurement
The condensed consolidated financial statements have been prepared under the 
historical cost basis except for derivative financial instruments and 
liabilities for cash-settled share-based payment arrangements that have been 
measured at fair value. The employee benefit liability is recognized as the 
net total of the pension plan assets, plus unrecognized past service cost and 
unrecognized actuarial losses, less unrecognized actuarial gains and losses 
and the present value of the defined benefit obligation.

Functional and presentation currency
These condensed consolidated financial statements are presented in Canadian 
dollars, which is the Corporation's functional currency. All financial 
information presented in Canadian dollars has been rounded to the nearest 
thousand, unless otherwise stated and except share and per share data.

3. CHANGE IN ACCOUNTING POLICY
On January 1, 2012, the Corporation early adopted amendments to International 
Accounting Standard ("IAS") 1 Presentation of Financial Statements: 
Presentation of Items of Other Comprehensive Income. The amendments to IAS 1 
require that an entity present separately the items of other comprehensive 
income that may be reclassified to profit or loss in the future from those 
that would never be reclassified to profit or loss. These amendments are to be 
applied retrospectively in the first annual fiscal period beginning on or 
after July 1, 2012, with early adoption permitted. This new presentation is 
included in the consolidated statements of comprehensive income.

4. RENTAL EQUIPMENT
The Corporation acquired rental equipment with a cost of $3,583 during the 
quarter (2011 - $4,996) and $25,076 year to date (2011 - $20,177). Rental 
equipment with a carrying amount of $276 during the quarter (2011 - $777) and 
$1,522 year to date (2011 - $3,073) ceased to be rented and was classified as 
held for sale in the normal course of business and transferred to inventories.

5. PROPERTY, PLANT AND EQUIPMENT
The Corporation acquired property, plant and equipment with a cost of $586 
during the quarter (2011 - $2,682) and $6,234 year to date (2011 - $5,499). 
Assets with a carrying amount of $38 during the quarter (2011 - $122) and $662 
year to date (2011 - $193) were disposed of, resulting in losses on disposal 
of $10 during the quarter (2011 - $75) and $139 year to date (2011 - $61).

6. BANK DEBT
On May 24, 2012 and December 7, 2012, the Corporation amended its bank credit 
facility to increase the limit of the facility by $50,000 and $75,000 
respectively, on substantially the same terms and conditions as the existing 
facility. The fully secured facility of $300,000, due August 12, 2016, is now 
comprised of an $80,000 non-revolving term portion and a $220,000 revolving 
term portion. The $568 cost of amending the facility has been capitalized and 
will be amortized over the remaining term of the facility.

7. SHARE CAPITAL
                                        Number of Shares    Amount

Balance, December 31, 2010                             - $       -

Converted on January 1, 2011 from trust       16,629,444   105,371
units

Balance, December 31, 2011                    16,629,444 $ 105,371

Shares issued to settle share-based              107,003     1,280
compensation plans

Balance, December 31, 2012                    16,736,447 $ 106,651

8. DIVIDENDS DECLARED
During the three months ended December 31, 2012, the Corporation declared cash 
dividends of $0.81 per share or $13,557 (December 31, 2011, dividends of $0.60 
per share or $9,978).

Year to date, the Corporation declared cash dividends of $3.10 per share or 
$51,789 (December 31, 2011, dividends of $2.14 per share or $35,587).

The Corporation has declared dividends of $0.27 per share or $4,519 for each 
of January and February 2013.

9. SHARE-BASED COMPENSATION PLANS
The Corporation has five share-based compensation plans: the Wajax Share 
Ownership Plan ("SOP"), the Deferred Share Program ("DSP"), the Directors' 
Deferred Share Unit Plan ("DDSUP"), the Mid-Term Incentive Plan for Senior 
Executives ("MTIP") and the Deferred Share Unit Plan ("DSUP").

a) Share Rights Plans
The Corporation recorded compensation cost of $219 for the quarter (2011 - 
recovery of $386) and $738 for the year to date (2011 - $957) in respect of 
these plans.

Share Rights Plans         December 31, 2012      December 31, 2011
                        Number of   Fair value Number of   Fair value
                           Rights           at    Rights           at
                                       time of                time of
                                         grant                  grant

Outstanding at            316,595 $      4,908   273,960 $      4,133
beginning of year

Granted in - new grants    27,231        1,304    21,137          775
the period
           - dividend      18,129            -    21,498            -
           equivalents

Settled in the period   (107,003)      (1,280)         -            -

Outstanding at end of     254,952 $      4,932   316,595 $      4,908
period

At December 31, 2012, 240,102 share rights were vested (December 31, 2011 - 
312,020).

b) Cash-settled rights plans
The Corporation recorded a compensation recovery of $513 for the quarter (2011 
- expense of $568) and an expense of $2,653 for the year to date (2011 - 
$4,420) in respect of the share-based portion of the MTIP. At December 31, 
2012, the carrying amount of the share-based portion of these liabilities was 
$2,444 (2011 - $8,272).

10. INCOME TAXES
Income tax expense comprises current and deferred tax as follows:
                                                   2012      2011

Current                                      $   44,353 $     442

Deferred       - Origination and reversal of   (20,621)    24,401
               temporary difference
               - Change in tax law and rates         30   (1,164)

Income tax expense                           $   23,762 $  23,679

The calculation of current tax is based on a combined federal and provincial 
statutory income tax rate of 26.2% (2011 - 27.7%). The tax rate for the 
current year is 1.5% lower than 2011 due to the effect of the reduced 
statutory tax rates. Deferred tax assets and liabilities are measured at tax 
rates that are expected to apply to the period when the asset is realized or 
the liability is settled. Deferred tax assets and liabilities have been 
measured using an expected average combined statutory income tax rate of 26.1% 
based on the tax rates in years when the temporary differences are expected to 
reverse.

The reconciliation of effective income tax is as follows:
                                                   2012       2011

Combined statutory income tax rate                26.2%      27.7%

Expected income tax expense at statutory rates $ 23,502 $   24,233

Non-deductible expenses                             548        621

Deferred tax related to changes in tax law and       30    (1,164)
rates

Other                                             (318)       (11)

Income tax expense                             $ 23,762  $  23,679

Recognized deferred tax assets and liabilities

Recognized deferred tax assets and liabilities are comprised as follows:
                                           December   December
                                           31, 2012   31, 2011

Property, plant and equipment            $  (2,099) $  (1,773)

Finance leases                                  117      (195)

Intangible assets                           (2,973)    (2,355)

Accrued liabilities                           5,241      5,249

Provisions                                    2,265      2,504

Derivative instruments                           18         56

Employee benefits                             1,861      1,752

Deferred financing costs                         81       (29)

Partnership income not currently taxable    (1,893)   (23,236)

Tax loss carryforwards                          304        333

Net deferred tax assets (liabilities)    $    2,922 $ (17,694)

11. EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted earnings 
per share:
                         Three months ended        Twelve months ended
                             December 31               December 31
                            2012         2011         2012         2011

Numerator for basic
and diluted
earnings per share:                                                    

net earnings        $     14,194 $     16,561 $     65,939 $     63,803

Denominator for
basic earnings per
share:
- weighted average
shares                16,736,447   16,629,444   16,699,874   16,629,444

Denominator for
diluted earnings
per share:                                                             

- weighted average
shares                16,736,447   16,629,444   16,699,874   16,629,444

- effect of
dilutive share
rights                   234,518      307,790      254,236      294,555

Denominator for
diluted earnings
per share             16,970,965   16,937,234   16,954,110   16,923,999

Basic earnings per
share               $       0.85 $       1.00 $       3.95 $       3.84

Diluted earnings
per share           $       0.84 $       0.98 $       3.89 $       3.77

No share rights were excluded from the above calculations as none were 
anti-dilutive.

12. CHANGES IN NON-CASH OPERATING WORKING CAPITAL
                              Three months ended   Twelve months ended
                                 December 31           December 31
                                  2012      2011        2012       2011

Trade and other receivables $  (6,900) $  13,770 $  (17,139) $ (27,054)

Inventories                      8,854   (9,250)    (39,035)   (34,959)

Prepaid expenses                 (680)     1,535         999      (571)

Accounts payable and          (29,067)    18,761    (58,354)     39,833
accrued liabilities

Provisions                       2,431     1,839       (818)      2,498

Total                       $ (25,362) $  26,655 $ (114,347) $ (20,253)

13. ACQUISITION OF BUSINESSES
On October 22, 2012, the Industrial Components segment acquired all of the 
issued and outstanding shares of ACE Hydraulic Limited, a hydraulic cylinder 
repair business located in Bathurst, New Brunswick with annual revenues of 
approximately $2,000.

On December 31, 2012, the Industrial Components segment acquired certain 
assets of Kaman Industrial Techonologies, a leading distributor of industrial 
parts in British Columbia and southern Ontario with annual revenues of 
approximately $21,000.

Recognized amounts of identifiable assets acquired and liabilities assumed for 
both acquisitions are as follows:

Trade and other receivables              $   3,210

Inventories                                  3,104

Prepaid expenses                                55

Property, plant and equipment                1,853

Accounts payable and accrued liabilities   (1,853)

Deferred taxes                               (188)

Other liabilities                            (302)

Obligations under finance leases             (205)

Tangible net assets acquired                 5,674

Intangible assets                            4,404

Consideration paid                       $  10,078

The consideration paid is subject to post-closing adjustments and therefore 
the purchase price equation is subject to change.

14. OPERATING SEGMENTS
The Corporation operates through a network of 128 branches in Canada in three 
core businesses which reflect the internal organization and management 
structure according to the nature of the products and services provided. The 
Corporation's three core businesses are: i) the distribution, modification and 
servicing of equipment; ii) the distribution, servicing and assembly of power 
systems; and iii) the distribution, servicing and assembly of industrial 
components.
                                                                    

For the                                                  Segment
three months                                        Eliminations
ended                                                        and
December 31,                   Power   Industrial    Unallocated
2012             Equipment   Systems   Components        Amounts       Total

Equipment      $   118,815 $  29,506 $          - $            - $   148,321

Parts               42,195    31,305       80,679              -     154,179

Service             28,746    16,189        4,646              -      49,581

Rental and    
other               11,861     2,027            -        (1,040)      12,848

Revenue        $   201,617 $  79,027 $     85,325 $      (1,040) $   364,929

Segment       
earnings
before
finance
costs and
income taxes   $    13,995 $   5,015 $      3,607 $              $    22,617

Corporate     
costs and
eliminations                                             (2,017)     (2,017)

Earnings      
before
finance
costs
and income
taxes               13,995     5,015        3,607        (2,017)      20,600

Finance       
costs                                                      1,337       1,337

Income tax    
expense                                                    5,069       5,069

Net earnings   $    13,995 $   5,015 $      3,607 $      (8,423) $    14,194
                                                                            
                                                                            

For the       
twelve                                                   Segment
months                                              Eliminations
ended                                                        and
December 31,                   Power   Industrial    Unallocated
2012             Equipment   Systems   Components        Amounts       Total

Equipment      $   475,647 $ 123,024 $          - $            - $   598,671

Parts              165,398   135,043      341,164              -     641,605

Service             99,239    68,276       18,885              -     186,400

Rental and    
other               38,198     5,951            -        (4,811)      39,338

Revenue        $   778,482 $ 332,294 $    360,049 $      (4,811) $ 1,466,014

Segment       
earnings
before
finance
costs and
income taxes   $    56,130 $  26,130 $     22,130 $              $   104,390

Corporate     
costs and
eliminations                                            (10,247)    (10,247)

Earnings      
before
finance
costs
and income
taxes               56,130    26,130       22,130       (10,247)      94,143

Finance       
costs                                                      4,442       4,442

Income tax    
expense                                                   23,762      23,762

Net earnings   $    56,130 $  26,130 $     22,130 $     (38,451) $    65,939
                                                                            

As at
December 31,  
2012                                                                        

Segment       
assets
excluding
intangible
assets         $   315,499 $ 145,444 $    121,045 $              $   581,988

Intangible    
assets              21,845    14,488       51,333              2      87,668

Corporate     
and other
assets                                                     2,206       2,206

Total assets   $   337,344 $ 159,932 $    172,378 $        2,208 $   671,862
                                                                    

For the                                                  Segment
three months                                        Eliminations
ended                                                        and
December 31,                   Power   Industrial    Unallocated
2011             Equipment   Systems   Components        Amounts       Total

Equipment      $   117,581 $  42,341 $          - $            - $   159,922

Parts               44,004    35,273       85,185              -     164,462

Service             22,854    16,329        5,007              -      44,190

Rental and    
other                7,849     1,546            -          (787)       8,608

Revenue        $   192,288 $  95,489 $     90,192 $        (787) $   377,182

Segment       
earnings
before
finance
costs and
income taxes   $    14,337 $   7,885 $      5,902 $              $    28,124

Corporate     
costs and
eliminations                                             (4,490)     (4,490)

Earnings      
before
finance
costs
and income
taxes               14,337     7,885        5,902        (4,490)      23,634

Finance       
costs                                                      1,153       1,153

Income tax    
expense                                                    5,920       5,920

Net earnings   $    14,337 $   7,885 $      5,902 $     (11,563) $    16,561
                                                                            
                                                                            
                                                                    

For the       
twelve                                                   Segment
months                                              Eliminations
ended                                                        and
December 31,                   Power   Industrial    Unallocated
2011             Equipment   Systems   Components        Amounts       Total

Equipment      $   397,613 $ 155,876 $          - $            - $   553,489

Parts              173,188   125,509      328,993              -     627,690

Service             84,697    61,134       18,545              -     164,376

Rental and    
other               30,342     4,906            -        (3,703)      31,545

Revenue        $   685,840 $ 347,425 $    347,538 $      (3,703) $ 1,377,100

Segment       
earnings
before
finance
costs and
income taxes   $    50,193 $  32,915 $     23,106 $              $   106,214

Corporate     
costs and
eliminations                                            (14,102)    (14,102)

Earnings      
before
finance
costs
and income
taxes               50,193    32,915       23,106       (14,102)      92,112

Finance       
costs                                                      4,630       4,630

Income tax    
expense                                                   23,679      23,679

Net earnings   $    50,193 $  32,915 $     23,106 $     (42,411) $    63,803
                                                                            

As at
December 31,  
2011                                                                        

Segment       
assets
excluding
intangible
assets         $   238,161 $ 146,695 $    114,714 $              $   499,570

Intangible    
assets              22,083    14,760       47,643              7      84,493

Cash                                                       5,659       5,659

Corporate     
and other
assets                                                       204         204

Total assets   $   260,244 $ 161,455 $    162,357 $        5,870 $   589,926

Segment assets do not include assets associated with the corporate office, 
financing costs or income taxes. Additions to corporate assets, and 
depreciation of these assets, are included in segment eliminations and 
unallocated amounts.















Mark Foote, President and Chief Executive Officer Email:mfoote@wajax.com

John Hamilton, Chief Financial Officer Email:jhamilton@wajax.com

Telephone #: (905) 212-3300

SOURCE: Wajax Corporation

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