/NOT FOR DISTRIBUTION TO
The news release contains "forward-looking information and statements" within the meaning of applicable securities laws. For full disclosure of the forward-looking information and statements and the risks to which they are subject, see the "Cautionary Statement Regarding Forward-Looking Information and Statements" later in this news release.
YEAR-END FINANCIAL AND OPERATIONAL HIGHLIGHTS
- Subsequent to year-end, Strad entered into an arrangement agreement with 2238399
Alberta Ltd. ("Acquireco") to privatize the Company; - Revenue increased 9% to
$130.2 million compared to$119.9 million in 2018; - Revenue for Industrial Matting in
Canada was$59.9 million , up 37%, and inthe United States ("U.S. ") was$23.8 million , up 42% compared with 2018; - Net income improved to
$1.1 million compared to a net loss of$(1.0) million in 2018; - EBITDA(1) increased 33% to
$36.1 million compared to$27.2 million in 2018; - Capital additions totaled
$32.8 million and was deployed to grow and maintain the Company's Industrial Matting fleet to meet the expected demand inCanada and theU.S. ; - Approved
$25.0 million of capital for 2020 to grow and maintain the Company's Industrial Matting fleet inCanada and theU.S. ; - Grew the Industrial Matting fleet by 21% to 135,415 mats from 111,710 mats in 2018;
- Changed corporate name to
Strad Inc. to better reflect the direction of the Company as it continues to focus on customers from a wide ranged of industrial sectors; - Purchased and canceled 117,898 common shares in 2019 at an average price of
$1.81 under the current normal course issuer bid ("NCIB") that was renewed onNovember 28, 2019 . Under the previous NCIB, Strad purchased and canceled 2,668,971 common shares at an average price of$1.56 ; and - Funded debt(2) decreased to
$8.5 million atDecember 31, 2019 , compared to$14.0 million atDecember 31, 2018 . Funded debt(2) to covenant EBITDA(3) ratio was 0.3 : 1.0 atDecember 31, 2019 .
FOURTH QUARTER FINANCIAL AND OPERATIONAL HIGHLIGHTS
- Revenue increased 22% to
$39.4 million compared to$32.3 million for the same period in 2018; - Revenue for Industrial Matting Canada was
$22.0 million , up 58%, and in theU.S. was$5.8 million , up 25% compared with the same period in 2018; - Net loss for the fourth quarter was
$(0.5) million compared to a net loss of$(5.4) million for the same period in 2018; - EBITDA(1) increased 2% to
$10.8 million as compared to$10.6 million for the same period in 2018. EBITDA increased in part due to a$2.9 million improvement in Industrial Matting EBITDA and offset by a$2.2 million decline in Equipment Rentals EBITDA; and - Capital additions totaled
$3.7 million and was deployed to grow and maintain the Company's Industrial Matting fleet to meet the expected demand inCanada and theU.S.
Notes: | |
(1) | Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS, and, accordingly, Strad's use of such a term may not be comparable to similarly defined measures presented by other entities; see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(2) | Funded debt includes bank indebtedness plus long-term debt less cash. |
(3) | Covenant EBITDA, as defined in the Company's credit facility agreement, is based on trailing twelve month EBITDA plus share based payments, plus additional one-time charges, less right of use asset amortization, less interest expense associated with leases. |
"2019 marked our first full year of our strategy focused on the high growth industrial matting market, which has allowed us to participate in a broader range of sectors across
"The fourth quarter highlighted the potential for Industrial Matting to deliver high rates of return as three projects launched in the third quarter of 2019 continued through to the end of the year, resulting in a 35% increase in EBITDA for the segment. Our strong results for the quarter were underpinned by higher Canadian utilization rates of 58%, and a 25% increase in revenue from our US business. These developments contributed to a 50% increase in revenue for the quarter compared to 2018," said
FOURTH QUARTER EARNINGS CONFERENCE CALL
As a result of the Arrangement Agreement signed on
YEAR-END FINANCIAL HIGHLIGHTS
(in thousands of Canadian dollars)
Three months ended | ||||||||
Industrial Matting | Equipment Rentals | Corporate | Total | |||||
Revenue | 27,757 | 11,625 | — | 39,382 | ||||
Operating expenses | 15,062 | 8,939 | — | 24,001 | ||||
Selling, general and administration | 1,547 | 2,092 | 1,045 | 4,684 | ||||
Share based payments | 25 | 33 | — | 58 | ||||
Gain on property, plant and equipment disposals | (68) | (105) | — | (173) | ||||
Gain on foreign exchange | (13) | (19) | — | (32) | ||||
EBITDA(1)(2) | 11,204 | 685 | (1,045) | 10,844 | ||||
Depreciation and amortization(3) | 4,868 | 6,294 | 161 | 11,323 | ||||
EBIT(4) | 6,336 | (5,609) | (1,206) | (479) | ||||
Interest expense | 316 | 316 | ||||||
Income tax recovery | (295) | (295) | ||||||
Net (loss) income | (1,227) | (500) | ||||||
Equipment Fleet: | ||||||||
Matting fleet at period end | 135,415 | — | — | 135,415 | ||||
Average matting fleet | 136,770 | — | — | 136,770 | ||||
Equipment fleet at period end | — | 5,860 | — | 5,860 | ||||
Average Equipment fleet | — | 5,860 | — | 5,860 |
Three months ended | ||||||||
Industrial Matting | Equipment Rentals | Corporate | Total | |||||
Revenue | 18,493 | 13,810 | — | 32,303 | ||||
Operating expenses | 8,675 | 9,059 | — | 17,734 | ||||
Selling, general and administration | 1,422 | 1,935 | 605 | 3,962 | ||||
Share based payments | 29 | 40 | 15 | 84 | ||||
(Gain) loss on property, plant and equipment disposals | (17) | (204) | 3 | (218) | ||||
Loss on foreign exchange | 64 | 78 | — | 142 | ||||
EBITDA(1,2) | 8,320 | 2,902 | (623) | 10,599 | ||||
Depreciation and amortization(3) | 3,475 | 14,570 | 208 | 18,253 | ||||
EBIT(4) | 4,845 | (11,668) | (831) | (7,654) | ||||
Interest expense | 235 | 235 | ||||||
Income tax recovery | (2,518) | (2,518) | ||||||
Net income (loss) | 1,452 | (5,371) | ||||||
Equipment Fleet: | ||||||||
Matting fleet at period end | 111,710 | — | — | 111,710 | ||||
Average matting fleet | 107,900 | — | — | 107,900 | ||||
Equipment fleet at period end | — | 6,120 | — | 6,120 | ||||
Average equipment fleet | — | 6,140 | — | 6,140 |
Notes: | |
(1) | Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS, and, accordingly, Strad's use of such term may not be comparable to similarly defined measures presented by other entities; see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(2) | The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
(3) | Included in depreciation and amortization for the year-ended |
(4) | Earnings (loss) before interest and tax ("EBIT") is an additional measure under IFRS, see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(in thousands of Canadian dollars)
Year-ended | ||||||||||||
Industrial Matting | Equipment Rentals | Corporate | Total | |||||||||
Revenue | $ | 83,697 | $ | 46,539 | $ | — | $ | 130,236 | ||||
Operating expenses | 43,843 | 32,823 | — | 76,666 | ||||||||
Selling, general and administration | 5,902 | 8,059 | 3,745 | 17,706 | ||||||||
Share based payments | 96 | 128 | 17 | 241 | ||||||||
Gain on property, plant and equipment disposals | (136) | (234) | — | (370) | ||||||||
Gain on foreign exchange | (23) | (36) | (20) | (79) | ||||||||
EBITDA (1,2) | 34,015 | 5,799 | (3,742) | 36,072 | ||||||||
Depreciation and amortization(3) | 18,338 | 16,772 | 606 | 35,716 | ||||||||
EBIT (4) | 15,677 | (10,973) | (4,348) | 356 | ||||||||
Interest expense | 1,321 | 1,321 | ||||||||||
Income tax recovery | (2,058) | (2,058) | ||||||||||
Net (loss) income | (3,611) | 1,093 | ||||||||||
Equipment Fleet: | ||||||||||||
Matting fleet at period end | 135,415 | — | — | 135,415 | ||||||||
Average matting fleet | 128,190 | — | — | 128,190 | ||||||||
Equipment fleet at period end | — | 5,860 | — | 5,860 | ||||||||
Average equipment fleet | — | 5,900 | — | 5,900 |
Year-ended | ||||||||||||
Industrial Matting | Equipment Rentals | Corporate | Total | |||||||||
Revenue | $ | 60,463 | $ | 59,459 | $ | — | $ | 119,922 | ||||
Operating expenses | 33,826 | 44,056 | — | 77,882 | ||||||||
Selling, general and administration | 5,197 | 6,960 | 2,987 | 15,144 | ||||||||
Share based payments | 113 | 158 | 61 | 332 | ||||||||
Gain on property, plant and equipment disposals | (256) | (527) | (5) | (788) | ||||||||
Loss (gain) on foreign exchange | 67 | 97 | (6) | 158 | ||||||||
EBITDA (1,2) | 21,516 | 8,715 | (3,037) | 27,194 | ||||||||
Depreciation and amortization(3) | 7,468 | 26,497 | 404 | 34,369 | ||||||||
EBIT (4) | 14,048 | (17,782) | (3,441) | (7,175) | ||||||||
Interest expense | 812 | 812 | ||||||||||
Income tax recovery | (6,970) | (6,970) | ||||||||||
Net income (loss) | 2,717 | (1,017) | ||||||||||
Equipment Fleet: | ||||||||||||
Matting fleet at period end | 111,710 | — | — | 111,710 | ||||||||
Average matting fleet | 91,780 | — | — | 91,780 | ||||||||
Equipment fleet at period end | — | 6,120 | — | 6,120 | ||||||||
Average equipment fleet | — | 6,100 | — | 6,100 |
Notes: | |
(1) | Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS, and, accordingly, Strad's use of such term may not be comparable to similarly defined measures presented by other entities; see "Non-IFRS and Additional IFRS Measures and Reconciliations" |
(2) | The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
(3) | Included in depreciation and amortization for the year-ended |
(4) | Earnings (loss) before interest and tax ("EBIT") is an additional measure under IFRS, see "Non-IFRS and Additional IFRS Measures and Reconciliations" |
FINANCIAL POSITION AND RATIOS
(in thousands of Canadian dollars, except ratio amounts) | As at | As at |
Working capital(1) | 10,321 | 19,333 |
Funded debt(2) | 8,512 | 14,009 |
Total assets | 173,188 | 175,477 |
Funded debt to EBITDA(3) | 0.3 : 1.0 | 0.5 : 1.0 |
Notes: | |
(1) | Working capital is calculated as current assets less current liabilities. |
(2) | Funded debt includes bank indebtedness plus long-term debt less cash. |
(3) | EBITDA is based on trailing twelve months adjusted EBITDA plus share based payments, plus severance and transaction costs. |
FOURTH QUARTER RESULTS
Strad reported an increase in revenue of 22% and an increase in EBITDA of 2%, during the three months ended
For the three months ended
Strad's Equipment Rentals segment reported a decrease in revenue of 16% and EBITDA of 76% during the three months ended
For the three months ended
OUTLOOK
Fiscal 2019 ended with continued strong growth for the Company's Industrial Matting Segment. For 2019, revenue and EBITDA were
While the pipeline projects in
Early in 2020, rig counts and activity levels are ahead of expectations in
Since our first Normal Course Issuer Bid ("NCIB") was announced in the later half of 2017, we have repurchased 5,555,189 shares representing over 9% of our outstanding shares. We continue to view our NCIB program as a key component of our total shareholder return and will continue to be active in repurchasing shares when it is advantageous to do so.
In 2020 we look to increase our matting fleet further, while our strong cash flow generation and minimal debt balance continue to provide the flexibility to evaluate various alternatives to create shareholder value.
RESULTS OF OPERATIONS
Industrial Matting
Three months ended | Year-ended | |||||||
(in thousands of Canadian dollars) | 2019 | 2018 | % | 2019 | 2018 | % | ||
Canadian revenue | $ | 21,965 | $ | 13,869 | 58% | 59,852 | 43,629 | 37% |
5,792 | 4,624 | 25% | 23,845 | 16,834 | 42% | |||
Total Revenue | 27,757 | 18,493 | 50% | 83,697 | 60,463 | 38% | ||
EBITDA(1)(2) | 11,204 | 8,320 | 35% | 34,015 | 21,516 | 58% | ||
EBITDA as a percentage of revenue | 40% | 45% | 41% | 36% | ||||
EBIT(3) | 6,336 | 4,845 | 31% | 15,677 | 14,048 | 12% | ||
EBIT as a percentage of revenue | 23% | 26% | 19% | 23% | ||||
Capital expenditures(4) | 3,286 | 11,941 | (72)% | 31,926 | 31,307 | 2% | ||
Property, plant and equipment | 72,028 | 64,921 | 11% | 72,028 | 64,921 | 11% | ||
Equipment Fleet: | ||||||||
Canadian matting fleet | 92,065 | 85,200 | 8% | 92,065 | 85,200 | 8% | ||
43,350 | 26,510 | 64% | 43,350 | 26,510 | 64% | |||
Matting fleet at period end(5) | 135,415 | 111,710 | 21% | 135,415 | 111,710 | 21% | ||
Canadian average matting fleet | 93,730 | 82,160 | 14% | 92,630 | 71,030 | 30% | ||
43,040 | 25,740 | 67% | 35,560 | 20,750 | 71% | |||
Average matting fleet(6) | 136,770 | 107,900 | 27% | 128,190 | 91,780 | 40% | ||
Canadian average utilization | 58% | 45% | 38% | 34% | ||||
35% | 45% | 37% | 36% | |||||
Average utilization %(7) | 48% | 45% | 38% | 35% |
Notes: | |
(1) | Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS, and, accordingly, Strad's use of such term may not be comparable to similarly defined measures presented by other entities; see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(2) | The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
(3) | Earnings (loss) before interest and tax ("EBIT") is an additional measure under IFRS, see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(4) | Includes purchases of intangible assets and excludes purchases of right of use assets. |
(5) | Matting fleet balances are as at |
(6) | Matting fleet balances are averages for the three months and year-ended |
(7) | Utilization includes matting on rent only and is calculated using gross asset value. |
Revenue for the three months ended
The Company's average matting fleet for the three months ended
EBITDA for the three months ended
EBIT for the three months ended
Revenue for the year-ended
During the year-ended
EBIT for the year-ended
Operating expenses for the three months and year-ended
Equipment Rentals
Three months ended | Year-ended | |||||||||||
(in thousands of Canadian dollars) | 2019 | 2018 | % | 2019 | 2018 | % | ||||||
Canadian revenue | 5,131 | 7,112 | (28)% | 22,163 | 33,770 | (34)% | ||||||
6,494 | 6,698 | (3)% | 24,376 | 25,689 | (5)% | |||||||
Total Revenue | 11,625 | 13,810 | (16)% | 46,539 | 59,459 | (22)% | ||||||
EBITDA(1)(2) | 685 | 2,902 | (76)% | 5,799 | 8,715 | (33)% | ||||||
EBITDA as a percentage of revenue | 6% | 21% | 12% | 15% | ||||||||
EBIT (3) | (5,609) | (11,668) | nm | (10,973) | (17,782) | nm | ||||||
EBIT as a percentage of revenue | (48)% | (84)% | (24)% | (30)% | ||||||||
Capital expenditures(4) | 66 | 97 | (32)% | 368 | 1,171 | (69)% | ||||||
Property, plant and equipment | 54,637 | 71,790 | (24)% | 54,637 | 71,790 | (24)% | ||||||
Equipment Fleet: | ||||||||||||
Canadian equipment fleet | 3,770 | 4,225 | (11)% | 3,770 | 4,225 | (11)% | ||||||
2,090 | 1,895 | 10% | 2,090 | 1,895 | 10% | |||||||
Equipment fleet at period end(5) | 5,860 | 6,120 | (4)% | 5,860 | 6,120 | (4)% | ||||||
Canadian average equipment fleet | 3,800 | 4,250 | (11)% | 3,870 | 4,200 | (8)% | ||||||
2,060 | 1,890 | 9% | 2,030 | 1,900 | 7% | |||||||
Average equipment fleet(6) | 5,860 | 6,140 | (5)% | 5,900 | 6,100 | (3)% | ||||||
Canadian average utilization | 29% | 31% | 30% | 32% | ||||||||
34% | 43% | 38% | 41% | |||||||||
Average utilization %(7) | 31% | 36% | 34% | 34% | ||||||||
Rig Counts(8) | ||||||||||||
138 | 193 | (28)% | 132 | 189 | (30)% | |||||||
Bakken | 53 | 55 | (4)% | 55 | 54 | 2% | ||||||
Marcellus | 53 | 75 | (29)% | 70 | 77 | (9)% | ||||||
Rockies | 58 | 68 | (15)% | 69 | 68 | 1% |
Notes: | |
(1) | Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS, and, accordingly, Strad's use of such term may not be comparable to similarly defined measures presented by other entities; see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(2) | The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
(3) | Earnings (loss) before interest and tax ("EBIT") is an additional measure under IFRS, see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(4) | Includes purchases of intangible assets and excludes purchases of right of use assets. |
(5) | Equipment rentals fleet balances are as at |
(6) | Equipment rentals fleet balances are averages for the three months and year-ended |
(7) | Equipment utilization includes surface equipment on rent only and is calculated using gross asset value. |
(8) | Source: Baker Hughes "North America Rotary Rig Count". Rig Counts are average rig counts for the period. |
Revenue for the three months ended
For the three months ended
EBIT for the three months ended
Revenue for the year-ended
During the year-ended
EBIT for the year-ended
Operating expenses for the three months and year-ended
Subsequent event
On
As part of the Arrangement Agreement, Strad Inc. has also agreed to pay a termination fee of
The Transaction is subject to customary
LIQUIDITY AND CAPITAL RESOURCES
(in thousands of Canadian dollars) | ||||
Current assets | $ | 32,624 | $ | 36,625 |
Current liabilities | 22,303 | 17,292 | ||
Working capital(1) | 10,321 | 19,333 | ||
Banking facilities | ||||
Operating facility | 1,509 | 762 | ||
Syndicated revolving facility | 7,003 | 12,934 | ||
Total facility borrowings | 8,512 | 13,696 | ||
Total credit facilities(2) | 48,500 | 48,500 | ||
Unused credit capacity | 39,988 | 34,804 |
Notes: | |
(1) | Working capital is a Non-IFRS measure and calculated by Strad as current assets less current liabilities, as derived from the Company's consolidated statement of financial position; see "Non-IFRS and Additional IFRS Measures and Reconciliations". |
(2) | Facilities are subject to certain limitations on accounts receivable, inventory, and net book value of fixed assets and are secured by a general security agreement over all of the Company's assets. As at |
As at
The increase in current liabilities is primarily the result of an increase in current lease liabilities to
Cash flow from operating activities for the year-ended
As at
As at
Based on the Company's funded debt to covenant EBITDA ratio, the interest rate on the syndicated credit facility is bank prime plus 0.50% on prime rate advances and at the prevailing rate plus a stamping fee of 1.50% on bankers' acceptances. For the year-ended
As at
The relevant definitions related to the financial debt covenant ratio terms as set forth in the Company's syndicated banking facility are as follows:
- Funded debt includes bank indebtedness plus long-term debt less cash.
- Covenant EBITDA is based on trailing twelve months adjusted EBITDA plus share based payments, plus additional one-time charges, less right of use asset amortization, less interest expense associated with leases.
- Interest expense ratio is calculated as the ratio of trailing twelve month EBITDA plus share based payments to trailing twelve month interest expense on loans and borrowings.
The above noted definitions are not recognized under IFRS and are provided strictly for the purposes of the financial covenant calculation.
Financial Debt Covenants | As at | As at | ||
Funded debt to EBITDA ratio (not to exceed 3.0:1) | ||||
Funded debt | $ | 8,512 | $ | 14,009 |
Covenant EBITDA | 30,116 | 26,877 | ||
Ratio | 0.3 | 0.5 | ||
EBITDA to interest coverage ratio (no less than 3.0:1) | ||||
Covenant EBITDA | 30,116 | 26,877 | ||
Covenant interest expense | 1,046 | 812 | ||
Ratio | 28.8 | 33.1 |
NON-IFRS AND ADDITIONAL IFRS MEASURES AND RECONCILIATIONS
Certain supplementary measures in this Press Release do not have any standardized meaning as prescribed under IFRS and, therefore, are considered non-IFRS measures. These measures are described and presented in order to provide shareholders and potential investors with additional information regarding the Company's financial results, liquidity and its ability to generate funds to finance its operations. These measures are identified and presented, where appropriate, together with reconciliations to the equivalent IFRS measure. However, they should not be construed as alternative measures to IFRS measures, and as they do not have standardized meanings or standardized methods of calculation, the may not be consistent with or comparable to similar measures presented by other companies. These measures are further explained below.
Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a recognized measure under IFRS. Management believes that in addition to net income (loss), EBITDA is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed and taxed. EBITDA is calculated as net income (loss) before interest, taxes, and depreciation and amortization. Segmented EBITDA is based upon the same calculation for defined business segments, which are comprised of Industrial Matting and Equipment Rentals. The Company's method of calculating EBITDA may differ from that of other organizations and, accordingly, its EBITDA may not be comparable to that of other companies.
Earnings (loss) before interest and taxes ("EBIT") is an additional measure under IFRS. Management believes that in addition to net income (loss), EBIT is a useful supplemental measure as it provides an indication of the results generated by the Company's principal business activities prior to consideration of how those activities are financed and taxed.
Funds from operations are cash flow from operating activities excluding changes in non-cash working capital. Funds from operations is a non-IFRS measure commonly used in industrial services industries, such as Pipeline, Oil and Gas, Transmission and Distribution, as well as Construction, to assist in measuring a company's ability to finance its capital programs, debt repayments and other financial obligations. Funds from operations is not intended to represent net cash generated from operating activities or other measures of financial performance in accordance with IFRS. It is a supplemental measure to gauge performance of the Company before non-cash items. The Company's method of calculating funds from operations may differ from that of other organizations and, accordingly, its funds from operations may not be comparable to that of other companies.
Working capital is calculated as current assets minus current liabilities, as derived from the Company's consolidated statement of financial position. Working capital, cash forecasting, and banking facilities are used by Management to ensure funds are available to finance growth opportunities.
Funded debt is a measure used in calculating our bank financial covenants. Funded debt is calculated as bank indebtedness plus long-term debt less cash from syndicate institutions.
Reconciliation of Funds from Operations
(in thousands of Canadian dollars) | ||||||
Three months ended | Year-ended | |||||
2019 | 2018 | 2019 | 2018 | |||
Net cash generated from operating activities | 9,365 | 6,230 | 46,598 | 29,801 | ||
Less: | ||||||
Changes in non-cash working capital | (5,265) | (5,197) | 1,404 | (3,840) | ||
Funds from Operations | 14,630 | 11,427 | 45,194 | 33,641 |
Reconciliation of EBITDA and EBIT
(in thousands of Canadian dollars) | ||||||||
Three months ended | Year-ended | |||||||
2019 | 2018 | 2019 | 2018 | |||||
Net (loss) income: | (500) | (5,371) | 1,093 | (1,017) | ||||
Add (deduct): | ||||||||
Depreciation and amortization | 11,323 | 18,253 | 35,716 | 34,369 | ||||
Income tax recovery | (295) | (2,518) | (2,058) | (6,970) | ||||
Interest expense | 316 | 235 | 1,321 | 812 | ||||
EBITDA(1) | 10,844 | 10,599 | 36,072 | 27,194 | ||||
(Deduct): | ||||||||
Depreciation and amortization | (11,323) | (18,253) | (35,716) | (34,369) | ||||
EBIT | (479) | (7,654) | 356 | (7,175) | ||||
(1) The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
Reconciliation of quarterly non-IFRS and additional IFRS measures | ||||||||
(in thousands of Canadian dollars) | ||||||||
Three months ended | ||||||||
Net (loss) income: | (500) | 1,736 | (1,704) | 1,566 | ||||
Add (deduct): | ||||||||
Depreciation and amortization | 11,323 | 8,245 | 8,997 | 7,150 | ||||
Income tax (recovery) expense | (295) | (76) | (1,820) | 132 | ||||
Interest expense | 316 | 344 | 310 | 351 | ||||
EBITDA(1) | 10,844 | 10,249 | 5,783 | 9,199 | ||||
(Deduct): | ||||||||
Depreciation and amortization | (11,323) | (8,245) | (8,997) | (7,150) | ||||
EBIT | (479) | 2,004 | (3,214) | 2,049 | ||||
(1) The current period results include impacts from the adoption of IFRS 16 "Leases", which was adopted by the Company on |
Three months ended | ||||||||
Net (loss) income: | (5,371) | 890 | 3,861 | (397) | ||||
Add (deduct): | ||||||||
Depreciation and amortization(1) | 18,253 | 5,444 | 5,240 | 5,432 | ||||
Income tax (recovery) expense | (2,518) | (62) | (4,428) | 38 | ||||
Interest expense | 235 | 230 | 157 | 190 | ||||
EBITDA(2) | 10,599 | 6,502 | 4,830 | 5,263 | ||||
(Deduct): | ||||||||
Depreciation and amortization | (18,253) | (5,444) | (5,240) | (5,432) | ||||
EBIT | (7,654) | 1,058 | (410) | (169) | ||||
(1) Included in depreciation and amortization for the three months ended of Equipment Rentals assets during the fourth quarter of 2018. | ||||||||
(2) During the second quarter of 2018, the Company changed the method of calculation for EBITDA by no longer adjusting for gains or losses resulting from foreign exchange or the disposal of property, plant and equipment during the normal course of business. These changes have been updated for prior period balances. |
Reconciliation of funded debt | ||
(in thousands of Canadian dollars) | ||
Year-ended | Year-ended | |
Bank indebtedness at syndicate banks | 1,509 | 762 |
Long term debt | 7,003 | 12,934 |
Lease liabilities | — | 313 |
Funded Debt | 8,512 | 14,009 |
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION AND STATEMENTS
Certain statements and information contained in this Press Release constitute forward-looking information and statements within the meaning of applicable securities laws and are made as of the date of this Press Release. The use of any of the words "expect", "plan", "continue", "estimate", "anticipate", "potential", "targeting", "intend", "could", "might", "should", "believe", "may", "predict", or "will" and similar expressions are intended to identify forward-looking information or statements. More particularly, this Press Release contains forward-looking statements concerning the Company's business plans, including its focus on the growth of its matting fleet, expectations regarding future business prospects and growth opportunities, future capital expenditures of the Company, including its 2020 capital budget, planned allocations of capital expenditures, and funding thereof, by way of cash flow, the competitive environment for equipment rentals in
Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this Press Release. The forward-looking information and statements included in this Press Release are not guarantees of future performance and should not be unduly relied upon. Forward-looking statements are based on current expectations, estimates, and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated and described in the forward-looking statements. Such information and statements involve known and unknown risks, uncertainties, and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements. In addition to other material factors, expectations, and assumptions which may be identified in this Press Release and other continuous disclosure documents of the Company referenced herein, assumptions have been made in respect of such forward-looking statements and information regarding, among other things: the Company will continue to conduct its operations in a manner consistent with past operations; the general continuance of current industry conditions; anticipated financial performance, business prospects, impact of competition, strategies, the general stability of the economic and political environment in which the Company operates; exchange and interest rates; tax laws; the sufficiency of budgeted capital expenditures in carrying out planned activities; the availability and cost of labour and services and the adequacy of cash flow; debt and ability to obtain financing on acceptable terms to fund its planned expenditures, which are subject to change based on commodity prices; market conditions and future oil and natural gas prices; and potential timing delays. Although Management considers these material factors, expectations, and assumptions to be reasonable based on information currently available to it, no assurance can be given that they will prove to be correct.
Readers are cautioned that the foregoing lists of factors are not exhaustive. Additional information on these and other factors that could affect the Company's operations and financial results are included in reports on file with the Canadian Securities Regulatory Authorities and may be accessed through the SEDAR website (www.sedar.com) or at the Company's website. The forward-looking statements and information contained in this Press Release are expressly qualified by this cautionary statement. The Company does not undertake any obligation to publicly update or revise any forward looking statements or information, whether as a result of new information, future events, or otherwise, except as may be required by applicable securities laws.
Consolidated Statement of Financial Position
As at
(in thousands of Canadian dollars) | As at | As at |
$ | $ | |
Assets | ||
Current assets | ||
Trade receivables | 30,867 | 32,013 |
Inventories | 423 | 1,839 |
Prepaids and deposits | 876 | 2,063 |
Lease receivable - current portion | 351 | — |
Income taxes receivable | 107 | 710 |
Total current assets | 32,624 | 36,625 |
Non-current assets | ||
Property, plant and equipment | 126,924 | 136,978 |
Intangible assets | 1,272 | 1,448 |
Right of use assets | 11,697 | — |
Income tax receivable | 287 | 305 |
Lease receivable | 91 | — |
Deferred income tax assets | 293 | 121 |
Total non-current assets | 140,564 | 138,852 |
Total assets | 173,188 | 175,477 |
Liabilities | ||
Current liabilities | ||
Bank indebtedness | 1,509 | 762 |
Accounts payable and accrued liabilities | 15,087 | 16,373 |
Income taxes payable | 107 | — |
Lease liabilities - current portion | 5,600 | 157 |
Total current liabilities | 22,303 | 17,292 |
Non-current liabilities | ||
Long-term debt | 7,003 | 12,934 |
Lease liabilities | 6,749 | 156 |
Deferred income tax liabilities | 7,128 | 9,151 |
Total liabilities | 43,183 | 39,533 |
Equity | ||
Share capital | 140,737 | 147,664 |
Contributed surplus | 13,309 | 13,068 |
Accumulated other comprehensive income | 20,275 | 23,439 |
Deficit | (44,316) | (48,227) |
Total equity | 130,005 | 135,944 |
Total liabilities and equity | 173,188 | 175,477 |
Consolidated Statement of Income (Loss) and Comprehensive Income (Loss)
For the years ended
(in thousands of Canadian dollars, except per share amounts) | ||
Year-ended | ||
2019 | 2018 | |
$ | $ | |
Revenue | 130,236 | 119,922 |
Expenses | ||
Operating expenses | 76,666 | 77,882 |
Depreciation | 29,885 | 34,070 |
Amortization of intangible assets | 542 | 299 |
Amortization of right of use assets | 5,289 | — |
Selling, general and administration | 17,706 | 15,144 |
Share-based payments | 241 | 332 |
Gain on disposal of property, plant and equipment | (370) | (788) |
(Gain) loss on foreign exchange | (79) | 158 |
Interest expense | 1,321 | 812 |
Loss before income tax | (965) | (7,987) |
Income tax recovery | (2,058) | (6,970) |
Income (loss) for the period | 1,093 | (1,017) |
Other comprehensive income (loss) | ||
Items that may be reclassified subsequently to net income | ||
Cumulative translation adjustment | (3,164) | 5,148 |
Deferred tax expense on foreign exchange gain | — | (4,344) |
Total comprehensive loss | (2,071) | (213) |
Income per share: | ||
Basic | ( | |
Diluted | ( |
Consolidated Statement of Cash Flow
For the years ended
(in thousands of Canadian dollars) | ||
Year-ended | ||
2019 | 2018 | |
$ | $ | |
Cash flow provided by (used in) | ||
Operating activities | ||
Net income (loss) for the period | 1,093 | (1,017) |
Adjustments for items not affecting cash: | ||
Depreciation and amortization | 35,716 | 34,369 |
Deferred income tax recovery | (2,197) | (6,710) |
Share-based payments | 241 | 332 |
Interest expense | 1,321 | 812 |
Unrealized foreign exchange (gain) loss | (121) | 202 |
Gain on disposal of property, plant and equipment | (370) | (788) |
Book value of used fleet sales in operating activities | 9,511 | 6,441 |
Changes in items of non-cash working capital | 1,404 | (3,840) |
Net cash generated from operating activities | 46,598 | 29,801 |
Investing activities | ||
Purchase of property, plant and equipment | (32,428) | (32,568) |
Proceeds from sale of property, plant and equipment | 376 | 1,778 |
Purchase of intangible assets | (367) | (1,182) |
Proceeds from sale of other assets | — | 1,272 |
Changes in items of non-cash working capital | 1,790 | 364 |
Net cash used in investing activities | (30,629) | (30,336) |
Financing activities | ||
Repayment of long-term debt | (9,431) | (4,342) |
Borrowings | 3,500 | 6,500 |
Repayment of lease liabilities | (5,235) | (332) |
Repayment of shareholder loan | 91 | — |
Normal course issuer bid | (4,278) | (4,098) |
Interest expense | (1,321) | (812) |
Changes in items of non-cash working capital | (3) | 11 |
Net cash used in financing activities | (16,677) | (3,073) |
Effect of exchange rate changes on cash and cash equivalents | (39) | 987 |
Decrease in cash and cash equivalents | (747) | (2,621) |
Cash and cash equivalents (including bank indebtedness) - beginning of year | (762) | 1,859 |
Cash and cash equivalents (including bank indebtedness) - end of period | (1,509) | (762) |
Cash paid for income tax | 120 | 457 |
Cash paid for interest | 1,332 | 810 |
ABOUT STRAD
Strad specializes in industrial matting and equipment rentals for projects of any size, from a network of branches across
Strad is headquartered in
SOURCE
© Canada Newswire, source