From Hidden Costs to Record Growth: How Equipment Rate Management Fueled $700M in Growth at Redpath Mining

Redpath Mining

A Global Leader Facing Hidden Challenges

Redpath Mining is a global leader in underground mining, known for its expertise in mine development, raise boring, and shaft sinking. With operations spanning multiple continents, the company has built a reputation for delivering high-quality projects on time and on budget.

But despite its success, cracks were beginning to form beneath the surface.

During a routine financial review, Redpath’s leadership uncovered a troubling trend—declining project margins and rising equipment costs. Equipment rates were inconsistent, rate escalations lacked a structured approach, and outdated cost recovery models were making financial forecasting increasingly difficult. Millions of dollars were slipping through the cracks without a clear understanding of why.

The company had invested in training to help bridge the gap. Several team members had completed Mike Vorster’s Fundamentals of Equipment Economics training through CAT, giving them a strong foundation in equipment cost management. But knowing the principles wasn’t enough. They needed someone to translate those concepts into real-world solutions and help implement them in their business.

Without a structured approach to equipment rate modeling, lifecycles, and cost coding, Redpath was defaulting to time-and-materials contracts, leaving them exposed to financial risk on lump-sum projects. Their competitiveness was slipping, and without intervention, their market position was at risk.

“We knew something had to change,” recalls Sergio Patino, CFO of Redpath Americas. The company’s outdated approach to equipment rate modeling, lifecycles, and cost coding had become a major liability. Without accurate equipment cost projections, Redpath was stuck relying on time-and-materials contracts, missing out on more profitable unit-rate and lump-sum projects where margins could be maximized.

With legacy systems and unclear financial visibility, their competitive edge was at risk.

Coaching/guiding the team. By having Craig’s support, I noticed a significant acceleration of the team’s technical knowledge.

Sergio Patino, CFO

Redpath Americas

From Theory to Execution: The Lonewolf Approach

To turn knowledge into action, Redpath partnered with Lonewolf Consulting to develop a customized, precision-driven strategy for equipment cost management. This wasn’t just about plugging numbers into a spreadsheet—it was about building the internal capability to drive profitability, competitiveness, and long-term financial sustainability.

The solution focused on three key areas:

1. Equipment Rate Escalation Framework

Lonewolf developed a structured, market-driven approach to annual rate increases, eliminating the uncertainty that had plagued previous adjustments. Using manufacturer calculations and market indices, Redpath gained a clear, justifiable method for escalating equipment rates.
Instead of guesswork, they now had data-backed, contractually sound rate increases that minimized pushback from clients and improved cost recovery on work-in-hand projects.

2. Advanced Equipment Rate Modeling

Redpath’s team understood equipment cost principles from their training, but they lacked a repeatable system to apply them effectively. Lonewolf designed a data-driven framework to calculate equipment rates with pinpoint accuracy.

The model factored in ownership costs, operating expenses, lifecycle costs, rebuilds, overhauls, and indirect overhead—creating a full-picture view of equipment profitability. For the first time, Redpath had a structured, repeatable process for setting competitive, profitable rates that reflected the true cost of running their fleet.

3. Stakeholder Training & Change Management

A new system is only as strong as the people using it. Lonewolf worked directly with Redpath’s finance, equipment, and operations teams, providing one-on-one coaching, hands-on training, and implementation support to ensure seamless adoption.

Clear policies were developed to standardize best practices and ensure the new framework wasn’t just a short-term fix—it was a lasting financial strategy that would keep Redpath competitive for years to come.

Data-Driven Equipment Management: The Secret to Redpath’s Explosive Growth

The Results: A $700M Financial Breakthrough

The impact was immediate and measurable.

In the first year, Redpath recovered $54.5 million in additional contract revenue by properly escalating and optimizing equipment rates. With stronger rate structures and the ability to bid with confidence, their annual revenue surged from $1.0B in 2021 to $1.7B in 2024, proving that strong equipment cost management leads to real financial success.

But beyond the numbers, Redpath had transformed its entire approach to equipment cost management. They weren’t just guessing at rate increases—they had a system backed by data, contracts, and clear justifications. They weren’t just tracking equipment costs—they were optimizing them to maximize profitability.

“By having Craig work alongside our team to coach and guide, I noticed a significant acceleration of the team’s technical knowledge,” says Sergio Patino, CFO of Redpath Americas.

With a structured, data-driven system in place, Redpath eliminated financial uncertainty, strengthened its market position, and turned equipment from an over-budget cost center into a competitive advantage.