Acadian Timber Corp. (“Acadian” or the “Company”) (TSX:ADN) today
reported financial and operating results1 for the three months
ended September 28, 2024 (the “third quarter”).
“We maintained steady harvest volumes during the
third quarter, supported by sufficient contractor capacity and
favourable operating conditions. However, pricing pressure caused
by weak end user markets continued, affecting our total sales,”
said Adam Sheparski, President and Chief Executive Officer. “We
have advanced our real estate initiatives in the second half of the
year and we are excited about the opportunities ahead.”
Acadian generated sales of $26.0 million in the
third quarter, compared to $26.6 million in the prior year period.
Increased sales volumes from our freehold land (“freehold sales”)
were offset by a lower weighted average selling price and lower
timber services activity. Adjusted EBITDA for the quarter was $4.0
million, compared to $4.9 million in the same period of 2023.
Acadian generated $2.5 million of Free Cash Flow during the
quarter, compared to $4.3 million in the third quarter of 2023, and
declared dividends of $5.1 million or $0.29 per share to our
shareholders.
Acadian is committed to health and safety as our
number one priority. We believe that emphasizing and achieving a
good safety record is a leading indicator of success in the broader
business. Acadian’s operations experienced one recordable safety
incident among contractors during the quarter and none among
employees. Safety performance and incident reduction will be a
primary focus for the remainder of 2024 and beyond.
Real Estate Activities
We are advancing our efforts to maximize cash
flows from our timberland assets through real estate activities.
During the third quarter, Acadian purchased a meteorological tower
to collect wind data on our New Brunswick land base. This
investment enables further exploration of the opportunities
available to Acadian to participate in the renewable energy
sector.
On October 24, 2024, subsequent to the third
quarter, Acadian entered into an agreement to sell approximately
2,100 acres of timberland. The land included in the disposition is
composed of smaller parcels of relatively low operational or
strategic value to Acadian. The transaction is expected to close in
the fourth quarter and to result in gross proceeds of $1.4 million
and a gain on sale of $0.4 million.
_________________________________________ |
1 |
This news release makes reference is made to “Adjusted EBITDA”,
which Acadian’s management defines as net income before interest,
income taxes, fair value adjustments, non-cash cost of sales
related to carbon credits, recovery of or impairment of land and
roads and depreciation and amortization, and to “Adjusted EBITDA
margin”, which is Adjusted EBITDA as a percentage of sales.
Reference is also made to “Free Cash Flow”, which Acadian’s
management defines as Adjusted EBITDA less interest paid, current
income tax expense, and capital expenditures excluding acquisitions
of timberlands, plus net proceeds from the sale of timberlands and
other fixed assets (proceeds less gains or losses). Reference made
to “Payout Ratio” is defined as dividends declared divided by Free
Cash Flow and “Payout Ratio with DRIP” is defined as dividends paid
in cash divided by Free Cash Flow. Management believes that
Adjusted EBITDA, Adjusted EBITDA margin, Free Cash Flow, and Payout
Ratios are key performance measures in evaluating Acadian’s
operations and are important in enhancing investors’ understanding
of the Company’s operating performance. Adjusted EBITDA and
Adjusted EBITDA margin are indicative of the underlying
profitability of Acadian’s operating segments and are used to
evaluate operational performance. Free Cash Flow is used to
evaluate Acadian’s ability to generate sustainable cash flows from
our operations while Payout Ratios are used to evaluate Acadian’s
ability to fund its distribution using Free Cash Flow. Please refer
to the section entitled “Non-IFRS Measures” in Management’s
Discussion and Analysis for further details. |
|
|
Review of Operations
Financial and Operating
Highlights
(CAD thousands, |
Three Months Ended |
|
Nine Months Ended |
|
except volume and per share information) |
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Timber sales volume (000s m3) |
|
287.4 |
|
|
272.9 |
|
|
744.9 |
|
|
662.3 |
|
Carbon credit sales volume (000s credits) |
|
— |
|
|
— |
|
|
752.1 |
|
|
— |
|
Timber sales and services |
$ |
25,959 |
|
$ |
26,593 |
|
$ |
71,371 |
|
$ |
69,662 |
|
Carbon credit sales |
|
— |
|
|
— |
|
|
24,588 |
|
|
— |
|
Operating income |
|
3,899 |
|
|
4,733 |
|
|
20,444 |
|
|
15,254 |
|
Net income |
|
2,215 |
|
|
6,408 |
|
|
16,153 |
|
|
17,841 |
|
Adjusted EBITDA |
$ |
4,039 |
|
$ |
4,916 |
|
$ |
35,194 |
|
$ |
16,168 |
|
Adjusted EBITDA margin |
|
16 |
% |
|
18 |
% |
|
37 |
% |
|
23 |
% |
Free Cash Flow |
$ |
2,540 |
|
$ |
4,312 |
|
$ |
26,680 |
|
$ |
12,188 |
|
Dividends declared |
|
5,080 |
|
|
4,961 |
|
|
15,128 |
|
|
14,819 |
|
Dividends paid in cash |
|
2,588 |
|
|
3,721 |
|
|
8,900 |
|
|
11,166 |
|
Payout Ratio |
|
200 |
% |
|
115 |
% |
|
57 |
% |
|
122 |
% |
Payout Ratio with DRIP |
|
102 |
% |
|
86 |
% |
|
33 |
% |
|
92 |
% |
Per share – basic and diluted |
|
|
|
|
Net income |
$ |
0.13 |
|
$ |
0.37 |
|
$ |
0.93 |
|
$ |
1.05 |
|
Free Cash Flow |
|
0.15 |
|
|
0.25 |
|
|
1.53 |
|
|
0.71 |
|
Dividends declared |
|
0.29 |
|
|
0.29 |
|
|
0.87 |
|
|
0.87 |
|
During the third quarter, Acadian generated
sales of $26.0 million, compared to $26.6 million in the prior year
period with increased freehold sales volumes offset by a lower
weighted average selling price and lower timber services activity.
Freehold sales volume, excluding biomass, increased 15% compared to
the prior year period primarily due to a favourable change in
customer mix which shifted harvesting volumes from Crown licensed
timberlands to our freehold timberlands. The shift decreased our
timber services revenue and increased our freehold sales.
Weighted average selling price, excluding
biomass, decreased 5% year-over-year. Softwood sawlog pricing
decreased due to changes in product mix and weakness in end use
markets. Hardwood sawlog pricing decreased primarily due to
weakness in lumber markets. Softwood pulpwood pricing remained
relatively flat on an overall basis and hardwood pulpwood pricing
decreased as a result of shorter hauling distances. Biomass pricing
decreased 54% as a result of roadside sales instead of delivered
sales.
Operating costs and expenses were $22.1 million
during the third quarter, compared to $21.9 million during the
prior year period. The year-over-year increase reflects higher
timber sales volumes and increased weighted average variable costs
partially offset by lower timber services activity. Weighted
average variable harvesting costs, excluding biomass, increased 5%
as a result of greater hauling distances for softwood sawlogs and
higher contractor rates overall.
Adjusted EBITDA was $4.0 million during the
third quarter compared to $4.9 million in the prior year period.
Adjusted EBITDA margin for the quarter was 16% compared to 18% in
the prior year period. Free Cash Flow was $2.5 million as compared
to $4.3 million for the same period in the prior year.
Net income for the third quarter totaled $2.2
million, or $0.13 per share, compared to $6.4 million, or $0.37 per
share in the same period of 2023, primarily due to lower non-cash
fair value adjustments. Operating income and gain on sale of
timberlands and other fixed assets were also lower than the prior
year period and were partially offset by lower income tax
expense.
During the first nine months of 2024, Acadian
generated sales of $96.0 million as compared to $69.7 million in
the prior year period. The sale of 752,100 voluntary carbon credits
contributed $24.6 million to total sales. Timber sales volume,
excluding biomass, was 22% higher than the same period of 2023 but
was partially offset by a 5% decrease in the weighted average
selling price, excluding biomass, as well as lower timber services
activity. Operating costs and expenses of $75.5 million were $21.1
million higher year-over-year due to the addition of costs related
to carbon credit sales as well as increased timber sales volumes
and higher weighted average variable harvesting costs, partially
offset by lower timber services activity. Weighted average variable
harvesting costs increased 3% compared to the same period in the
prior year as a result of greater softwood sawlog hauling distances
and higher contractor rates partially offset by changes in product
mix. Adjusted EBITDA of $35.2 million was $19.0 million higher
compared to the prior year period.
For the nine months ended September 28, 2024,
net income was $16.2 million, or $0.93 per share, compared to $17.8
million, or $1.05 per share, in the prior year period, primarily
the result of higher operating income offset by lower non-cash fair
value adjustments, lower gains on sale of timberlands and other
fixed assets, as well as higher income tax expense.
Segment Performance
New Brunswick Timberlands
The table below summarizes operating and
financial results for New Brunswick Timberlands for the third
quarter:
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Sales (000s m3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Softwood |
|
|
152.9 |
|
|
129.9 |
|
|
354.4 |
|
|
275.2 |
|
Hardwood |
|
|
71.8 |
|
|
63.5 |
|
|
207.7 |
|
|
187.9 |
|
Biomass |
|
|
18.4 |
|
|
41.6 |
|
|
32.3 |
|
|
74.5 |
|
Total |
|
|
243.1 |
|
|
235.0 |
|
|
594.4 |
|
|
537.6 |
|
Sales ($000s) |
|
|
|
|
|
Softwood |
|
$ |
10,694 |
|
$ |
9,701 |
|
$ |
25,928 |
|
$ |
20,185 |
|
Hardwood |
|
|
5,800 |
|
|
5,333 |
|
|
18,503 |
|
|
18,093 |
|
Biomass |
|
|
238 |
|
|
1,336 |
|
|
946 |
|
|
2,966 |
|
Total |
|
$ |
16,732 |
|
$ |
16,370 |
|
$ |
45,377 |
|
$ |
41,244 |
|
Timber services and other |
|
|
5,073 |
|
|
6,466 |
|
|
11,715 |
|
|
16,067 |
|
Total Sales ($000s) |
|
$ |
21,805 |
|
$ |
22,836 |
|
$ |
57,092 |
|
$ |
57,311 |
|
Adjusted EBITDA ($000s) |
|
$ |
4,784 |
|
$ |
5,495 |
|
$ |
15,303 |
|
$ |
15,373 |
|
Adjusted EBITDA margin |
|
|
22 |
% |
|
24 |
% |
|
27 |
% |
|
27 |
% |
Sales for New Brunswick Timberlands were $21.8
million compared to $22.8 million during the prior year period,
with increased freehold sales volumes offset by a lower weighted
average selling price and lower timber services activity. Freehold
sales volume, excluding biomass, increased 16% compared to the
prior year period primarily due to a favourable change in customer
mix which shifted harvesting volumes from Crown licensed
timberlands to our freehold timberlands, decreasing our timber
services revenue and increasing our freehold sales. Biomass sales
volume was lower compared to the prior year period due to limited
processing capacity.
The weighted average selling price, excluding
biomass, for the third quarter was $73.46 per m3, or 6% lower than
the prior year period. Softwood sawlog pricing decreased 12%, as
compared to the prior year period, due to a lower value product mix
and weakness in end use markets. Hardwood sawlog pricing decreased
7% primarily due to weakness in lumber markets. Softwood pulpwood
pricing decreased 7% as a result of abundant regional sawmill
residuals impacting demand. Hardwood pulpwood pricing decreased 4%
as compared to the prior year period as a result of shorter hauling
distances.
Operating costs and expenses were $17.1 million
during the third quarter, compared to $17.5 million in the prior
year period. Increased freehold harvesting activity and increased
weighted average variable costs were offset by lower timber
services activity. Weighted average variable costs, excluding
biomass, increased 5% as a result of greater hauling distances for
softwood sawlogs and higher contractor rates.
Adjusted EBITDA for the quarter was $4.8 million
compared to $5.5 million during the prior year period and Adjusted
EBITDA margin was 22% compared to 24%.
During the first nine months of 2024, New
Brunswick Timberlands’ sales of $57.1 million were consistent with
the prior year period with increased freehold sales volumes offset
by a lower weighted average selling price and lower timber services
activity. Freehold sales volume, excluding biomass, increased 21%
compared to the prior year period primarily due to a favourable
change in customer mix which shifted harvesting volumes from Crown
licensed timberlands to our freehold timberlands, decreasing our
timber services revenue and increasing our freehold sales.
Operating costs and expenses of $42.0 million during the first nine
months of 2024 were $0.6 million lower than the prior year period.
Increased freehold harvesting activity and increased weighted
average variable costs were offset by lower timber services
activity. Weighted average variable costs, excluding biomass,
increased 2% as a result of greater softwood sawlog hauling
distances and higher contractor rates partially offset by a higher
proportion of softwood products which carry lower variable costs.
Adjusted EBITDA was $15.3 million, consistent with the first nine
months of 2023, and Adjusted EBITDA margin remained the same at
27%.
Maine Timberlands
The table below summarizes operating and
financial results for Maine Timberlands for the third quarter:
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Sales (000s m3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Softwood |
|
|
24.2 |
|
|
20.6 |
|
|
84.3 |
|
|
72.8 |
|
Hardwood |
|
|
17.3 |
|
|
17.3 |
|
|
61.0 |
|
|
45.4 |
|
Biomass |
|
|
2.8 |
|
|
— |
|
|
5.2 |
|
|
6.5 |
|
Total |
|
|
44.3 |
|
|
37.9 |
|
|
150.5 |
|
|
124.7 |
|
Sales ($000s) |
|
|
|
|
|
Softwood |
|
$ |
2,191 |
|
$ |
2,114 |
|
$ |
7,894 |
|
$ |
7,487 |
|
Hardwood |
|
|
1,538 |
|
|
1,415 |
|
|
5,416 |
|
|
4,149 |
|
Biomass |
|
|
77 |
|
|
— |
|
|
100 |
|
|
60 |
|
Total |
|
$ |
3,806 |
|
$ |
3,529 |
|
$ |
13,410 |
|
$ |
11,696 |
|
Other sales |
|
|
348 |
|
|
228 |
|
|
869 |
|
|
655 |
|
Total Sales ($000s) |
|
$ |
4,154 |
|
$ |
3,757 |
|
$ |
14,279 |
|
$ |
12,351 |
|
Adjusted EBITDA ($000s) |
|
$ |
(207 |
) |
$ |
(149 |
) |
$ |
1,843 |
|
$ |
2,084 |
|
Adjusted EBITDA margin |
|
|
(5 |
)% |
|
(4 |
)% |
|
13 |
% |
|
17 |
% |
Sales for Maine Timberlands during the third
quarter totaled $4.2 million compared to $3.8 million in the prior
year period. Timber sales volume, excluding biomass, increased 9%
reflecting more favourable weather conditions.
The weighted average selling price, excluding
biomass, in Canadian dollar terms was $90.01 per m3, compared to
$93.08 per m3 during the same period of 2023. In U.S. dollar terms,
the weighted average selling price, excluding biomass, was $65.97
per m3, compared to $69.45 per m3 in 2023. Softwood sawlog pricing
was 12% lower than the prior year period as a result of weakness in
lumber markets and a lower value product mix. Softwood pulpwood
pricing increased 29% due to increased demand. Hardwood pulpwood
pricing increased 4% as compared to the same period of 2023 due to
stable demand. Hardwood sawlog volumes were minimal during the
quarter.
Operating costs and expenses for the third
quarter were $4.4 million, compared to $3.9 million during the same
period in 2023, due primarily to increased sales volumes and higher
weighted average variable costs. Weighted average variable costs,
excluding biomass, increased 11% in Canadian dollar terms as a
result of greater hauling distances partially offset by changes in
product mix.
Adjusted EBITDA for the quarter was $(0.2)
million compared to $(0.1) million during the prior year period and
Adjusted EBITDA margin was (5)% compared to (4)%.
During the first nine months of 2024, Maine
Timberlands’ sales were $14.3 million compared to $12.4 million in
the first nine months of 2023. Maine Timberlands’ timber sales
volumes, excluding biomass, were 23% higher than the first nine
months of 2023 due to more favourable weather conditions, however,
the weighted average selling price, excluding biomass, decreased 7%
in Canadian dollar terms and 8% in U.S. dollar terms. Operating
costs and expenses of $12.7 million during the first nine months of
2024 were $2.3 million higher than the prior year period as a
result of higher harvesting activity and higher weighted average
variable costs. Weighted average variable costs, excluding biomass,
increased 6% as a result of greater hauling distances and higher
contractor rates partially offset by changes in product mix.
Environmental Solutions
As a result of increased diversification in
business activities, an additional reportable segment,
Environmental Solutions, was added in the first quarter of 2024.
Environmental Solutions leverages the ecological functions of
Acadian’s land to address pressing environmental challenges, such
as climate change and biodiversity. In line with these objectives,
Acadian has undertaken a voluntary carbon credit project which
increases carbon sequestration and provides significant
environmental benefits.
The table below summarizes operating and
financial results for Environmental Solutions for the third
quarter:
|
Three Months Ended |
|
Nine Months Ended |
|
|
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Sales volume (000s credits) |
|
— |
|
|
— |
|
|
752.1 |
|
|
— |
|
Sales ($000s) |
$ |
— |
|
|
— |
|
$ |
24,588 |
|
|
— |
|
Adjusted EBITDA ($000s) |
$ |
— |
|
|
— |
|
$ |
19,839 |
|
|
— |
|
The current model for the existing carbon credit
project estimates an additional 1.1 million credits to be generated
over the remainder of the 10-year crediting period. The
registration process for the second and third tranches of carbon
credits for this project is expected to result in approximately 0.4
million credits in total and is expected to be completed by the end
of 2024. Actual credit issuances will be adjusted each reporting
period based on actual harvesting, natural disturbances, and other
factors, as well as periodic updating for inventory and
verification activities.
Outlook
While near-term pressure on end use markets
persists, North American interest rates and inflation are showing
signs of easing. U.S. housing starts year-to-date are lower than
originally expected, but the consensus forecast for U.S. housing
starts is steady at approximately 1.35 million starts in 2024, as
compared to 1.42 million in 2023. We remain confident that the
stability of the northeastern forestry sector, combined with
long-term demand for new homes and repair and remodel activity,
will support the long-term demand for our products as has been
demonstrated in recent years.
Although labour markets remained tight in Maine,
we maintained sufficient contractor availability in New Brunswick
through the third quarter. Management will continue to focus on
further increasing harvesting capacity in Maine through the
remainder of 2024 while controlling operating costs. In the short
to medium term, elevated contractor rates are expected to impact
our financial results, offset by the stable pricing of primary
forest products like sawlogs and pulpwood.
Demand for Acadian’s sawlogs is mainly driven by
regional supply and demand. Near-term sawlog demand is expected to
remain stable while pricing may remain challenged until end-use
markets improve. Demand and pricing for softwood pulpwood is
expected to remain at reduced levels in the near term due to
abundant regional sawmill residuals and hardwood pulpwood is
expected to be steady.
During 2023, purchasers of voluntary carbon
credits increased their focus on carbon credits of high quality,
and expended greater time and effort performing due diligence. This
shift may have delayed some sales, however, underlying demand and
pricing for voluntary carbon credits are expected to remain stable.
The protocol for developing compliance market carbon credits from
managed forests in Canada was recently finalized. Acadian is
evaluating the opportunities to develop eligible carbon credits
that the compliance protocol may present, in conjunction with the
opportunities that exist under the current protocols.
Quarterly Dividend
Based on a strong balance sheet and positive
outlook for the remainder of the year, Acadian is pleased to
announce a dividend of $0.29 per share, payable on January 15, 2025
to shareholders of record December 31, 2024.
Acadian Timber Corp.
(“Acadian”) is one of the largest timberland owners in Eastern
Canada and the Northeastern U.S. and has a total of approximately
2.4 million acres of land under management. Acadian owns and
manages approximately 777,000 acres of freehold timberlands in New
Brunswick, approximately 300,000 acres of freehold timberlands in
Maine and provides timber services relating to approximately 1.3
million acres of Crown licensed timberlands in New Brunswick.
Acadian’s products include softwood and hardwood sawlogs, pulpwood
and biomass by-products, sold to approximately 90 regional
customers. Acadian also develops carbon credits for sale in
voluntary carbon credit markets.
Acadian’s business strategy is to maximize cash
flows from its existing timberland assets through sustainable
forest management and other land use activities while growing its
business by acquiring assets and actively managing these assets to
drive improved performance.
Acadian’s shares are listed for trading on the
Toronto Stock Exchange under the symbol ADN.
For further information, please visit our
website at www.acadiantimber.com or contact:
Susan WoodChief Financial OfficerTel:
506-737-2345 Email: ir@acadiantimber.com
Cautionary Statement Regarding
Forward-Looking Information and Statements
This News Release contains forward-looking
information and statements within the meaning of applicable
Canadian securities laws that involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
performance or achievements of Acadian Timber Corp. and its
subsidiaries (collectively, “Acadian”), or industry results, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Forward-looking information is included in this News
Release and includes statements made in the sections entitled
“Segment Performance – Environmental Solutions” and “Outlook” and
without limitation other statements regarding management’s beliefs,
intentions, results, performance, goals, achievements, future
events, plans and objectives, business strategy, growth strategy
and prospects, access to capital, liquidity and trading volumes,
dividends, taxes, capital expenditures, projected costs, market
trends and similar statements concerning anticipated future events,
results, achievements, circumstances, performance or expectations
that are not historical facts. All forward-looking statements in
this News Release are qualified by these cautionary statements.
Forward-looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, should not be unduly relied upon, and will
not necessarily be accurate indications of whether or not such
results will be achieved. Actual results may vary. These
forward-looking statements include, but are not limited to:
- Expectations regarding the number and
timing of carbon credits that will be successfully registered and
available for sale, as well as the timing of sales. Actual credit
issuances will be adjusted each reporting period based on actual
harvesting, natural disturbances and other factors, as well as
periodic updating for inventory and verification activities. The
timing of sales is dependent on negotiations with third
parties.
- Expectations regarding product demand,
pricing and end use markets, including expectations for U.S.
housing starts, which may be impacted by changes in interest rates,
U.S. population demographics and the inventory of homes for sale.
Expectations regarding product demand and pricing are based on
anticipated market conditions, anticipated regional inventory
levels of key customers, and the economic situation of key
customers. Estimates for U.S. housing starts are based on forecasts
published by major financial institutions.
Other risks and factors are discussed in each of
the Annual Information Form dated March 28, 2024 and the Management
Information Circular dated March 28, 2024 and other filings of
Acadian made with securities regulatory authorities, which are
available on SEDAR+ at www.sedarplus.ca. Forward-looking
information is based on various material factors or assumptions,
which are based on information currently available to Acadian.
Readers are cautioned that the preceding list of material factors
or assumptions is not exhaustive. Although the forward-looking
statements contained in this News Release are based upon what
management believes are reasonable assumptions, Acadian cannot
assure readers that actual results will be consistent with these
forward-looking statements. The forward-looking statements in this
News Release are made as of the date of this News Release based on
information currently available to management and should not be
relied upon as representing Acadian’s views as of any date
subsequent to the date of this News Release. Acadian assumes no
obligation to update or revise these forward-looking statements to
reflect new information, events, circumstances or otherwise, except
as may be required by applicable law.
Acadian Timber
Corp.Interim Condensed Consolidated Balance
Sheets
(unaudited)
As at(CAD thousands) |
September 28, 2024 |
|
December 31, 2023 |
|
Assets |
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
14,619 |
|
$ |
1,831 |
|
Accounts receivable and other assets |
|
10,494 |
|
|
9,301 |
|
Current income taxes receivable |
|
— |
|
|
1,668 |
|
Inventories |
|
1,582 |
|
|
15,329 |
|
|
|
26,695 |
|
|
28,129 |
|
Timber |
|
457,882 |
|
|
442,830 |
|
Land, roads, and other fixed assets |
|
94,714 |
|
|
90,854 |
|
Intangible asset |
|
6,140 |
|
|
6,140 |
|
Total assets |
$ |
585,431 |
|
$ |
567,953 |
|
Liabilities and shareholders’ equity |
|
|
Current liabilities |
|
|
Accounts payable and accrued liabilities |
$ |
12,669 |
|
$ |
9,370 |
|
Current income taxes payable |
|
703 |
|
|
— |
|
Dividends payable to shareholders |
|
5,086 |
|
|
4,983 |
|
Current portion of long-term debt |
|
43,197 |
|
|
— |
|
|
|
61,655 |
|
|
14,353 |
|
Long-term debt |
|
64,593 |
|
|
105,515 |
|
Deferred income tax liabilities, net |
|
131,423 |
|
|
129,103 |
|
Total liabilities |
|
257,671 |
|
|
248,971 |
|
Shareholders’ equity |
|
327,760 |
|
|
318,982 |
|
Total liabilities and shareholders’ equity |
$ |
585,431 |
|
$ |
567,953 |
|
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Net Income
(unaudited)
|
Three Months Ended |
|
Nine Months Ended |
|
(CAD thousands, except per share data) |
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Sales |
$ |
25,959 |
|
$ |
26,593 |
|
$ |
95,959 |
|
$ |
69,662 |
|
Operating costs and expenses |
|
|
|
|
Cost of sales |
|
18,306 |
|
|
18,584 |
|
|
63,413 |
|
|
46,648 |
|
Selling, administration and other |
|
2,428 |
|
|
2,104 |
|
|
10,302 |
|
|
6,065 |
|
Silviculture |
|
1,187 |
|
|
1,066 |
|
|
1,431 |
|
|
1,433 |
|
Depreciation and amortization |
|
139 |
|
|
106 |
|
|
369 |
|
|
262 |
|
|
|
22,060 |
|
|
21,860 |
|
|
75,515 |
|
|
54,408 |
|
Operating income |
|
3,899 |
|
|
4,733 |
|
|
20,444 |
|
|
15,254 |
|
Interest expense, net |
|
(654 |
) |
|
(795 |
) |
|
(2,400 |
) |
|
(2,375 |
) |
Other items |
|
|
|
|
Fair value adjustments and other |
|
(92 |
) |
|
3,593 |
|
|
4,991 |
|
|
10,126 |
|
Gain on sale of timberlands and other fixed assets |
|
1 |
|
|
77 |
|
|
203 |
|
|
652 |
|
Income before income taxes |
|
3,154 |
|
|
7,608 |
|
|
23,238 |
|
|
23,657 |
|
Income tax expense |
|
(939 |
) |
|
(1,200 |
) |
|
(7,085 |
) |
|
(5,816 |
) |
Net income |
$ |
2,215 |
|
$ |
6,408 |
|
$ |
16,153 |
|
$ |
17,841 |
|
Net income per share – basic and diluted |
$ |
0.13 |
|
$ |
0.37 |
|
$ |
0.93 |
|
$ |
1.05 |
|
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Comprehensive Income
(unaudited)
|
Three Months Ended |
|
Nine Months Ended |
|
(CAD thousands) |
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Net income |
$ |
2,215 |
|
$ |
6,408 |
|
$ |
16,153 |
|
$ |
17,841 |
|
Other comprehensive income |
|
|
|
|
Items that may be reclassified subsequently to net income: |
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized foreign currency translation gain / (loss) |
|
(752 |
) |
|
1,455 |
|
|
1,619 |
|
|
85 |
|
Comprehensive income |
$ |
1,463 |
|
$ |
7,863 |
|
$ |
17,772 |
|
$ |
17,926 |
|
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Cash Flows
(unaudited)
|
Three Months Ended |
|
Nine Months Ended |
|
(CAD thousands) |
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Cash provided by (used for): |
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
$ |
2,215 |
|
$ |
6,408 |
|
$ |
16,153 |
|
$ |
17,841 |
|
Adjustments to net income: |
|
|
|
|
Income tax expense |
|
939 |
|
|
1,200 |
|
|
7,085 |
|
|
5,816 |
|
Depreciation and amortization |
|
139 |
|
|
106 |
|
|
369 |
|
|
262 |
|
Fair value adjustments and other |
|
92 |
|
|
(3,593 |
) |
|
(4,991 |
) |
|
(10,126 |
) |
Non-cash cost of sales related to carbon credits |
|
— |
|
|
— |
|
|
14,178 |
|
|
— |
|
Gain on sale of timberlands and other fixed assets |
|
(1 |
) |
|
(77 |
) |
|
(203 |
) |
|
(652 |
) |
Income taxes paid |
|
(676 |
) |
|
(800 |
) |
|
(2,919 |
) |
|
(3,168 |
) |
Net change in non-cash working capital balances and other |
|
2,342 |
|
|
(489 |
) |
|
1,955 |
|
|
(2,438 |
) |
|
|
5,050 |
|
|
2,755 |
|
|
31,627 |
|
|
7,535 |
|
Financing activities |
|
|
|
|
Proceeds from short-term debt |
|
— |
|
|
— |
|
|
10,298 |
|
|
— |
|
Repayment of short-term debt |
|
— |
|
|
— |
|
|
(10,298 |
) |
|
— |
|
Dividends paid to shareholders |
|
(2,588 |
) |
|
(3,721 |
) |
|
(8,900 |
) |
|
(11,166 |
) |
|
|
(2,588 |
) |
|
(3,721 |
) |
|
(8,900 |
) |
|
(11,166 |
) |
Investing activities |
|
|
|
|
Additions to timber, land, roads, and other fixed assets |
|
(292 |
) |
|
(373 |
) |
|
(10,157 |
) |
|
(550 |
) |
Proceeds from sale of timberlands and other fixed assets |
|
1 |
|
|
80 |
|
|
218 |
|
|
670 |
|
|
|
(291 |
) |
|
(293 |
) |
|
(9,939 |
) |
|
120 |
|
Increase / (Decrease) in cash during the period |
|
2,171 |
|
|
(1,259 |
) |
|
12,788 |
|
|
(3,511 |
) |
Cash, beginning of period |
|
12,448 |
|
|
3,978 |
|
|
1,831 |
|
|
6,230 |
|
Cash, end of period |
$ |
14,619 |
|
$ |
2,719 |
|
$ |
14,619 |
|
$ |
2,719 |
|
Acadian Timber
Corp.Reconciliations to Adjusted EBITDA and Free
Cash Flow
(unaudited)
|
Three Months Ended |
|
Nine Months Ended |
|
(CAD thousands) |
September28, 2024 |
|
September30, 2023 |
|
September28, 2024 |
|
September30, 2023 |
|
Net income |
$ |
2,215 |
|
$ |
6,408 |
|
$ |
16,153 |
|
$ |
17,841 |
|
Add / (deduct): |
|
|
|
|
Interest expense, net |
|
654 |
|
|
795 |
|
|
2,400 |
|
|
2,375 |
|
Income tax expense |
|
939 |
|
|
1,200 |
|
|
7,085 |
|
|
5,816 |
|
Depreciation and amortization |
|
139 |
|
|
106 |
|
|
369 |
|
|
262 |
|
Fair value adjustments and other |
|
92 |
|
|
(3,593 |
) |
|
(4,991 |
) |
|
(10,126 |
) |
Non-cash cost of sales related to carbon credits |
|
— |
|
|
— |
|
|
14,178 |
|
|
— |
|
Adjusted EBITDA |
$ |
4,039 |
|
$ |
4,916 |
|
$ |
35,194 |
|
$ |
16,168 |
|
Add / (deduct): |
|
|
|
|
Interest paid on debt, net |
|
(764 |
) |
|
(764 |
) |
|
(2,485 |
) |
|
(2,238 |
) |
Additions to land, roads, and other fixed assets |
|
(292 |
) |
|
(373 |
) |
|
(740 |
) |
|
(550 |
) |
Gain on sale of timberlands and other fixed assets |
|
(1 |
) |
|
(77 |
) |
|
(203 |
) |
|
(652 |
) |
Proceeds from sale of timberlands and other assets |
|
1 |
|
|
80 |
|
|
218 |
|
|
670 |
|
Current income tax recovery (expense) |
|
(443 |
) |
|
530 |
|
|
(5,304 |
) |
|
(1,210 |
) |
Free Cash Flow |
$ |
2,540 |
|
$ |
4,312 |
|
$ |
26,680 |
|
$ |
12,188 |
|
Dividends declared |
$ |
5,080 |
|
$ |
4,961 |
|
$ |
15,128 |
|
$ |
14,819 |
|
Dividends paid in cash |
$ |
2,588 |
|
$ |
3,721 |
|
$ |
8,900 |
|
$ |
11,166 |
|
Payout Ratio |
|
200 |
% |
|
115 |
% |
|
57 |
% |
|
122 |
% |
Payout Ratio with DRIP |
|
102 |
% |
|
86 |
% |
|
33 |
% |
|
92 |
% |
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