LOGISTEC announces its results for the third quarter of 2018
LOGISTEC announces its results for the third quarter of 2018
Canada NewsWire
MONTRÉAL, Nov. 7, 2018
MONTRÉAL, Nov. 7, 2018 /CNW Telbec/ - LOGISTEC Corporation (TSX: LGT.A) (TSX: LGT.B), a marine and environmental services provider, today announced its financial results for the third quarter and first nine months ended September 29, 2018.
In the third quarter of 2018, consolidated revenue totalled $184.5 million, an increase of $16.2 million or 9.6% over the same period in 2017. Revenue from the marine services segment rose by 79.4% from $53.7 million to $96.4 million, while revenue from the environmental services segment amounted to $88.1 million, a decrease of $26.5 million or 23.1% from the third quarter of 2017. The third quarter of 2018 closed with a consolidated profit attributable to owners of the Company of $22.3 million, compared with a profit of $11.0 million for the third quarter of 2017. The profit attributable to owners of the Company translated to total diluted earnings per share of $1.69, of which $1.62 was attributable to Class A Common Shares and $1.78 to Class B Subordinate Voting Shares.
This strong performance is attributable in large part to the marine services segment, with revenue close to $100 million for the quarter and a profit before income taxes of $13.3 million. Furthermore, the acquisitions we made in this segment over the last two years, namely Logistec Gulf Coast, Gulf Stream Marine, and Pate Stevedore, were solid contributors to these results. In the environmental services segment, the profit before income taxes for this quarter improved compared to the same period last year, but performance was nonetheless lower than expected. This decrease can be explained by a lower activity level at FER-PAL compared to its record 2017 results. That being said, the combined backlog of Sanexen and FER-PAL totalled some $150 million as at the end of September 2018, a relatively high number for this time of year. This means that we will likely start 2019 with a substantial backlog, hence the positive forecast for our environmental services segment.
During the first nine months of 2018, consolidated revenue increased to $416.2 million, compared with $330.2 million for the same period in 2017. The profit attributable to owners of the Company amounted to $14.6 million, compared with a profit of $14.2 million for the same period last year. This translated into total diluted earnings per share of $1.12 of which $1.07 was attributable to Class A Common Shares and $1.17 to Class B Subordinate Voting Shares. For the same period in 2017, diluted earnings per share totalled $1.10, of which $1.05 was attributable to Class A Common Shares and $1.16 to Class B Subordinate Voting Shares.
Outlook
"The outlook remains positive. Both our marine and environmental services segments are expected to have a strong finish, and we continue to look for new growth opportunities", indicated Madeleine Paquin, President and Chief Executive Officer of LOGISTEC Corporation.
About LOGISTEC
LOGISTEC Corporation is based in Montréal (QC) and provides specialized services to the marine community and industrial companies in the areas of bulk, break-bulk and container cargo handling in 37 ports and 61 terminals across North America. LOGISTEC also offers marine transportation services geared primarily to the Arctic coastal trade and marine agency services to foreign shipowners and operators serving the Canadian market. Furthermore, the Company operates in the environmental services segment where it provides services to industrial, municipal and other governmental customers for the trenchless structural rehabilitation of underground water mains, regulated materials management, site remediation, risk assessment, and manufacturing of woven hoses.
The Company has been profitable and has paid regular dividends since becoming public and payments have grown steadily over the years. A public company since 1969, LOGISTEC'S shares are listed on the Toronto Stock Exchange under the ticker symbols LGT.A and LGT.B. More information can be obtained on the Company's website at www.logistec.com.
Forward-Looking Statements
For the purpose of informing shareholders and potential investors about the Company's prospects, sections of this document may contain forward-looking statements, within the meaning of securities legislation, about the Company's activities, performance and financial situation and, in particular, hopes for the success of the Company's efforts in the development and growth of its business. These forward-looking statements express, as of the date of this document, the estimates, predictions, projections, expectations or opinions of the Company about future events or results. Although the Company believes that the expectations produced by these forward-looking statements are founded on valid and reasonable bases and assumptions, these forward-looking statements are inherently subject to important uncertainties and contingencies, many of which are beyond the Company's control, such that the Company's performance may differ significantly from the predicted performance expressed or presented in such forward-looking statements. The important risks and uncertainties that may cause the actual results and future events to differ significantly from the expectations currently expressed are examined under "Business Risks" in the Company's annual report and include (but are not limited to) the performances of domestic and international economies and their effect on shipping volumes, weather conditions, labour relations, pricing and competitors' marketing activities. The reader of this document is thus cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to update or revise these forward-looking statements, except as required by law.
Additional information relating to our Company can be found on SEDAR's website at www.sedar.com and on LOGISTEC'S website at www.logistec.com.
Q3 2018 CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(in thousands of Canadian dollars, except for per share amounts and number of shares)
(unaudited and not reviewed by the independent auditor)
Condensed Consolidated Interim Statements of Earnings | |||||||
For the three months ended | For the nine months ended | ||||||
September 29, | September 30, | September 29, | September 30, | ||||
$ | $ | $ | $ | ||||
Revenue | 184,537 | 168,314 | 416,161 | 330,246 | |||
Employee benefits expense | (87,718) | (83,326) | (211,369) | (163,558) | |||
Equipment and supplies expense | (47,204) | (41,255) | (110,833) | (87,642) | |||
Rental expense | (12,784) | (9,068) | (33,623) | (24,186) | |||
Other expenses | (7,859) | (7,589) | (21,816) | (16,194) | |||
Depreciation and amortization expense | (7,385) | (12,419) | (19,953) | (20,668) | |||
Share of profit of equity accounted investments | 4,575 | 4,137 | 5,606 | 5,371 | |||
Other gains and losses | (400) | (2,226) | 755 | (555) | |||
Operating profit | 25,762 | 16,568 | 24,928 | 22,814 | |||
Finance expense | (2,272) | (889) | (5,918) | (1,779) | |||
Finance income | 414 | 98 | 512 | 279 | |||
Profit before income taxes | 23,904 | 15,777 | 19,522 | 21,314 | |||
Income taxes | (4,081) | (3,610) | (4,966) | (5,925) | |||
Profit for the period | 19,823 | 12,167 | 14,556 | 15,389 | |||
Profit attributable to: | |||||||
Owners of the Company | 22,256 | 10,955 | 14,647 | 14,214 | |||
Non-controlling interests | (2,433) | 1,212 | (91) | 1,175 | |||
Profit for the period | 19,823 | 12,167 | 14,556 | 15,389 | |||
Basic earnings per Class A Common Share (1) | 1.68 | 0.84 | 1.11 | 1.12 | |||
Basic earnings per Class B Subordinate Voting Share (2) | 1.85 | 0.93 | 1.22 | 1.23 | |||
Diluted earnings per Class A share | 1.62 | 0.80 | 1.07 | 1.05 | |||
Diluted earnings per Class B share | 1.78 | 0.88 | 1.17 | 1.16 | |||
Weighted average number of Class A shares outstanding, basic and diluted | 7,405,022 | 7,410,122 | 7,405,466 | 7,411,100 | |||
Weighted average number of Class B shares outstanding, basic | 5,286,167 | 5,062,472 | 5,240,222 | 4,845,939 | |||
Weighted average number of Class B shares outstanding, diluted | 5,741,904 | 5,720,654 | 5,730,299 | 5,565,206 | |||
(1) Class A Common Share ("Class A share") | |||||||
(2) Class B Subordinate Voting Share ("Class B share") | |||||||
Condensed Consolidated Interim Statements of Comprehensive Income | ||||
For the three months ended | For the nine months ended | |||
September 29, | September 30, | September 29, | September 30, | |
$ | $ | $ | $ | |
Profit for the period | 19,823 | 12,167 | 14,556 | 15,389 |
Other comprehensive income | ||||
Items that are or may be reclassified to the consolidated statements of earnings | ||||
Currency translation differences arising on translation of foreign operations | (2,141) | (2,281) | 2,841 | (2,810) |
Gain on derivatives | — | 87 | 4 | 87 |
Income tax related | — | (24) | (1) | (24) |
Total items that are or may be reclassified to the consolidated statements of earnings | (2,141) | (2,218) | 2,844 | (2,747) |
Items that will not be reclassified to the consolidated statements of earnings | ||||
Remeasurement gain (loss) on benefit obligation | 1,155 | 1,436 | 2,326 | (1,075) |
Return on retirement plan assets excluding amounts included in profit for the period | 19 | 535 | (14) | 676 |
Income taxes on remeasurement gain (loss) on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period | (308) | (530) | (613) | 107 |
Total items that will not be reclassified to the consolidated statements of earnings | 866 | 1,441 | 1,699 | (292) |
Share of other comprehensive income of equity accounted investments, net of income taxes | ||||
Items that are or may be reclassified to the consolidated statements of earnings | — | 24 | — | 24 |
Total share of other comprehensive income of equity accounted investments, net of income taxes | — | 24 | — | 24 |
Other comprehensive income for the period, net of income taxes | (1,275) | (753) | 4,543 | (3,015) |
Total comprehensive income for the period | 18,548 | 11,414 | 19,099 | 12,374 |
Total comprehensive income attributable to: | ||||
Owners of the Company | 20,990 | 10,202 | 19,176 | 11,199 |
Non-controlling interests | (2,442) | 1,212 | (77) | 1,175 |
Total comprehensive income for the period | 18,548 | 11,414 | 19,099 | 12,374 |
Condensed Consolidated Interim Statements of Financial Position | ||
As at | As at | |
$ | $ | |
Assets | ||
Current assets | ||
Cash and cash equivalents | 1,866 | 3,963 |
Trade and other receivables | 148,774 | 153,342 |
Work in progress | 29,863 | 5,306 |
Current income tax assets | 2,965 | 494 |
Other financial assets | 208 | 1,055 |
Prepaid expenses | 5,981 | 2,775 |
Inventories | 10,137 | 11,550 |
199,794 | 178,485 | |
Equity accounted investments | 36,640 | 34,350 |
Property, plant and equipment | 178,098 | 160,717 |
Goodwill | 161,304 | 105,618 |
Other intangible assets | 41,134 | 14,903 |
Other non-current assets | 1,762 | 1,658 |
Post-employment benefit assets | — | 606 |
Non-current financial assets | 6,997 | 7,984 |
Deferred income tax assets | 10,063 | 9,218 |
Total assets | 635,792 | 513,539 |
Liabilities | ||
Current liabilities | ||
Short-term bank loans | 11,609 | 9,829 |
Trade and other payables | 95,851 | 85,174 |
Deferred revenue | 4,655 | 2,252 |
Current income tax liabilities | 3,013 | 3,699 |
Dividends payable | 1,976 | 1,075 |
Current portion of long-term debt | 4,652 | 5,447 |
Provisions | 881 | 813 |
122,637 | 108,289 | |
Long-term debt | 162,058 | 77,957 |
Provisions | 1,956 | 771 |
Deferred income tax liabilities | 26,540 | 15,575 |
Post-employment benefit obligations | 12,433 | 14,778 |
Deferred revenue | 3,434 | 3,733 |
Non-current financial liabilities | 61,602 | 61,641 |
Total liabilities | 390,660 | 282,744 |
Equity | ||
Share capital | 35,143 | 29,019 |
Share capital to be issued | 14,717 | 19,820 |
Retained earnings | 183,692 | 173,129 |
Accumulated other comprehensive income | 9,436 | 6,606 |
Equity attributable to owners of the Company | 242,988 | 228,574 |
Non-controlling interests | 2,144 | 2,221 |
Total equity | 245,132 | 230,795 |
Total liabilities and equity | 635,792 | 513,539 |
Condensed Consolidated Interim Statements of Changes in Equity | |||||||||
Attributable to owners of the Company | |||||||||
Accumulated other comprehensive | |||||||||
Share capital | Share | Cash | Foreign currency translation | Retained earnings | Total | Non- | Total equity | ||
$ | $ | $ | $ | $ | $ | $ | $ | ||
Balance as at January 1, 2018 | 29,019 | 19,820 | 138 | 6,468 | 173,129 | 228,574 | 2,221 | 230,795 | |
Profit (loss) for the period | — | — | — | — | 14,647 | 14,647 | (91) | 14,556 | |
Other comprehensive income | |||||||||
Currency translation differences arising on translation of foreign operations | — | — | — | 2,827 | — | 2,827 | 14 | 2,841 | |
Remeasurement gain on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes | — | — | — | — | 1,699 | 1,699 | — | 1,699 | |
Cash flow hedges, net of income taxes | — | — | 3 | — | — | 3 | — | 3 | |
Total comprehensive income (loss) for the period | — | — | 3 | 2,827 | 16,346 | 19,176 | (77) | 19,099 | |
Remeasurement of written put option liability | — | — | — | — | (1,356) | (1,356) | — | (1,356) | |
Repurchase of Class A shares | — | — | — | — | (32) | (32) | — | (32) | |
Issuance and repurchase of Class B shares | 1,021 | — | — | — | (242) | 779 | — | 779 | |
Issuance of Class B share capital to a subsidiary shareholder upon the exercise of put options | 5,103 | (5,103) | — | — | — | — | — | — | |
Dividends on Class A shares | — | — | — | — | (1,894) | (1,894) | — | (1,894) | |
Dividends on Class B shares | — | — | — | — | (1,483) | (1,483) | — | (1,483) | |
Other dividends | — | — | — | — | (776) | (776) | — | (776) | |
Balance as at September 29, 2018 | 35,143 | 14,717 | 141 | 9,295 | 183,692 | 242,988 | 2,144 | 245,132 | |
Balance as at January 1, 2017 | 15,618 | 24,898 | (4) | 9,255 | 151,616 | 201,383 | 1,798 | 203,181 | |
Profit for the period | — | — | — | — | 14,214 | 14,214 | 1,175 | 15,389 | |
Other comprehensive income (loss) | |||||||||
Currency translation differences arising on translation of foreign operations | — | — | — | (2,810) | — | (2,810) | — | (2,810) | |
Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes | — | — | — | — | (292) | (292) | — | (292) | |
Cash flow hedges, net of income taxes | — | — | 87 | — | — | 87 | — | 87 | |
Total comprehensive income (loss) for the period | — | — | 87 | (2,810) | 13,922 | 11,199 | 1,175 | 12,374 | |
Repurchase of Class A shares | (2) | — | — | — | (91) | (93) | — | (93) | |
Issuance and repurchase of Class B shares | 8,359 | — | — | — | (697) | 7,662 | — | 7,662 | |
Non-controlling interests arising from business acquisitions | — | — | — | — | — | — | 50,593 | 50,593 | |
Long-term liability for the obligation to repurchase the non-controlling interests | — | — | — | — | — | — | (50,089) | (50,089) | |
Issuance of Class B share capital to a subsidiary shareholder upon the exercise of put options | 5,078 | (5,078) | — | — | — | — | — | — | |
Dividends on Class A shares | — | — | — | — | (1,723) | (1,723) | — | (1,723) | |
Dividends on Class B shares | — | — | — | — | (1,232) | (1,232) | — | (1,232) | |
Balance as at September 30, 2017 | 29,053 | 19,820 | 83 | 6,445 | 161,795 | 217,196 | 3,477 | 220,673 | |
Condensed Consolidated Interim Statements of Cash Flows | ||
For the nine months ended | ||
September 29, | September 30, | |
$ | $ | |
Operating activities | ||
Profit for the period | 14,556 | 15,389 |
Items not affecting cash and cash equivalents | 29,588 | 25,547 |
Cash generated from operations | 44,144 | 40,936 |
Dividends received from equity accounted investments | 3,346 | 3,600 |
Contributions to defined benefit retirement plans | (816) | (850) |
Settlement of provisions | (251) | (92) |
Changes in non-cash working capital items | (5,019) | (14,565) |
Income taxes paid | (9,127) | (1,702) |
32,277 | 27,327 | |
Financing activities | ||
Net change in short-term bank loans | 1,780 | 498 |
Issuance of long-term debt | 127,447 | 88,251 |
Repayment of long-term debt | (47,100) | (53,508) |
Interest paid | (5,087) | (1,745) |
Issuance of Class B shares | 561 | 201 |
Repurchase of Class A shares | (32) | (93) |
Repurchase of Class B shares | (272) | (751) |
Dividends paid on Class A shares | (1,833) | (1,667) |
Dividends paid on Class B shares | (1,419) | (1,173) |
74,045 | 30,013 | |
Investing activities | ||
Customer repayment of an investment in a service contract | — | 865 |
Interest received | 394 | 297 |
Business acquisitions | (97,998) | (48,037) |
Cash acquired in a business acquisition | 2,501 | — |
Cash paid to minority interest | (157) | (2,214) |
Acquisition of property, plant and equipment | (13,488) | (21,230) |
Proceeds from disposal of property, plant and equipment | 961 | 2,511 |
Repayment of other non-current assets | 193 | 142 |
Acquisition of intangible assets | (172) | (39) |
Acquisition of other non-current assets | — | (692) |
Increase of other non current-assets | (286) | — |
Repayment of other non-current financial assets | 159 | 72 |
(107,893) | (68,325) | |
Net change in cash and cash equivalents | (1,571) | (10,985) |
Cash and cash equivalents, beginning of period | 3,963 | 15,971 |
Effect of exchange rate on balances held in foreign currencies of foreign operations | (526) | 1,331 |
Cash and cash equivalents, end of period | 1,866 | 6,317 |
Additional information | ||
Acquisition of property, plant and equipment included in trade and other payables | 391 | 1,914 |
SOURCE Logistec Corporation
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