HIGHLIGHTS
- Revenues up by 23% compared with the same period a year
ago.
- Net income of $68,000.
- $65.0 million worth of new
contracts signed in the first quarter.
- Order backlog reached $343.3
million as at April 30, 2020,
up compared with January 31,
2020.
- COVID-19 had limited impact on ADF's operations during the
quarter ended April 30, 2020.
TERREBONNE, QC, June 10, 2020 /CNW Telbec/ - ADF GROUP
INC. ("ADF" or the "Corporation") Ticker
symbol: (TSX: DRX), recorded revenues of $45.8 million during the first quarter ended
April 30, 2020, compared with $37.1 million for the same quarter a year
ago.
The gross margin, as a percentage of revenues, went from 15.5%
during the quarter ended April 30,
2019, to 10.6% during the three-month period ended
April 30, 2020. Gross margin for the three months ended
April 30, 2020, is slightly higher
than the previous quarter's gross margin ended January 31, 2020, and reflects the level of
fabrication hours and prices of recently signed and ongoing
projects. It should be noted that gross margin, as a percentage of
revenues, for the same period a year earlier, had benefited from
the settlement of certain contractual changes.
For the first quarter ended April 30,
2020, ADF recorded a net income of $68,000 ($0.00
basic and diluted per share) compared with a net income of
$1.6 million ($0.05 basic and diluted per share) a year
ago.
The order backlog of the Corporation stood at $343.3 million as at April
30, 2020, compared with $328.7
million as at January 31, 2020. The current order
backlog will extend until end of the fiscal year ending
January 31, 2022.
On April 30, 2020, working capital stood at $28.5 million. Operational activities generated
over $12.0 million in liquidities
during the quarter ended April 30,
2020. The Corporation remains therefore in a sound position
to support its ongoing operations and pursue its development
projects.
Financial
Highlights
|
|
|
|
|
|
Three-Month Periods
Ended April 30,
|
2020
|
2019
|
(In thousands of
CA$, and dollars per share)
|
$
|
$
|
|
|
|
Revenues
|
45,797
|
37,146
|
Earnings before
interest, tax, depreciation and amortization (EBITDA)
|
2,967
|
3,019
|
Net income before
income tax recovery
|
(560)
|
1,300
|
Net income for the
period
|
68
|
1,618
|
—
Per share (basic and diluted)
|
0.00
|
0.05
|
|
|
|
(In
thousands)
|
Number
|
Number
|
Average number of
outstanding shares (basic and diluted)
|
32,635
|
32,635
|
New Orders
On March 23, 2020, the Corporation
announced the award of two new contracts in North America worth a total of $65.0 million, one as part of the construction of
a new industrial building in the transportation sector in
Quebec, and the other consists in
the construction of a new commercial building in California. In both cases, ADF was entrusted
with the design and engineering of connections, the fabrication,
including the procurement of raw material (steel) and industrial
coating, as well as the installation of these new structures. These
new contracts will be carried out at both of ADF's fabrication
plants, one in Terrebonne, Quebec
and the other in Great Falls,
Montana. Fabrication work on both new projects is scheduled
to start in the month of July 2020
and extend over a 12-month period.
Outlook
"We continued to grow our order backlog with the announcement of
new contracts totaling $65.0 million
in the first quarter ended April 30,
2020, and also significantly improved our cash position.
However, like many others, this Coronavirus pandemic has brought us
into uncharted territory. Although this pandemic currently has a
mixed impact on our operations, we stay abreast of economic
development and trends" indicated
Mr. Jean Paschini, Co-Chairman of the Board of
Directors and Chief Executive Officer.
Mr. Paschini added "In these exceptional times, we must
underscore the concerted efforts by our employees, and for this
reason, we would like to acknowledge and thank them.".
COVID-19
Since the beginning of this Coronavirus pandemic and at the date
hereof, all of our facilities, including all of our job sites,
remained open and operational.
However, in order for our fabrication plant in Terrebonne, Quebec, to remain in operation,
and in addition to the required sanitary and physical distancing
measures, the Corporation had to limit the number of employees per
work shift. While this has resulted in some operational
limitations, the Corporation has nevertheless been able to maintain
a sufficient level of fabrication in order to adequately serve its
customers.
The Corporation introduced the telework program and implemented
strategies to support appropriate physical distancing techniques
for its staff who cannot work remotely. It should be noted that the
various measures taken in response to the pandemic have also
resulted in some additional costs.
This situation is evolving rapidly and the Corporation continues
to monitor and mitigate developments affecting its staff,
suppliers, customers and the general public as much as it
can. Although the impact of COVID-19 on ADF's operations is
limited for the time being, the extent to which the virus can have
an impact on our results will depend on future developments, which
are very uncertain and cannot be predicted at this time, including
new information that may emerge regarding the severity of COVID-19
and the measures taken to contain it or address its impact, among
others.
Conference Call with Investors
A conference call with investors is scheduled for today,
June 10, 2020, at 10 a.m. (Montreal time) to discuss the results of
Corporation first quarter results ended April 30, 2020.
To take part in the conference call, dial 1-888-390-0620, a few
minutes prior to the conference call scheduled start time.
A replay of this conference call will be available from
1:00 p.m. today, until midnight,
Wednesday June 17, 2020, by dialing
1-888-390-0541, followed by the access code 378870 #.
The conference call (audio) will also be available at
www.adfgroup.com. Members of the media are invited to listen
in.
Annual Meeting of Shareholders by Webcast
ADF Group is holding its Annual Meeting of Shareholders today,
June 10, 2020, at 11:00 a.m. (Montreal time), by way of a live webcast that
will be available at:
https://produceredition.webcasts.com/starthere.jsp?ei=1299576&tp_key=f3438fc3e7
Important notice
In light of the ongoing public health concerns related to the
COVID-19 outbreak and in order to comply with the measures imposed
by the federal and provincial governments, the Corporation is
encouraging shareholders and others not to attend the meeting in
person.
Shareholders are urged to vote on the matters before the
meeting by proxy and to view the meeting online.
Shareholders will be able to submit questions to management of
the Corporation through the webcast.
The Corporation may take additional precautionary measures in
relation to the meeting in response to further developments in the
COVID-19 outbreak.
About ADF Group Inc.
ADF Group Inc. is a North American leader in the design and
engineering of connections, fabrication, including industrial
coatings, and installation of complex steel structures, heavy steel
built-ups, as well as in miscellaneous and architectural metals for
the non-residential construction industry. ADF Group Inc. is one of
the few players in the industry capable of handling highly
technically complex mega projects on fast-track schedules in the
commercial, institutional, industrial and public sectors. The
Corporation operates two fabrication plants and two paint shops, in
Canada and in the United States.
Non-IFRS Measures
Earnings before interest, taxes, depreciation and amortization
("EBITDA") is not a performance measure recognized by IFRS
standards, and is not likely to be comparable to similar measures
presented by other issuers. Management, as well as investors,
consider this to be useful information to assist them in assessing
the Corporation's profitability and ability to generate funds to
finance its operations. Refer to the section "Non-GAAP Measures" of
the Corporation's Management's Discussion and Analysis for the
definition of this metric and reconciliation to the most comparable
IRFS measures.
Forward-Looking Information
This press release contains forward-looking statements
reflecting ADF objectives and expectations. These statements are
identified by the use of verbs such as "expect" as well as by the
use of future or conditional tenses. By their very nature these
types of statements involve risks and uncertainty. Consequently,
reality may differ from ADF's expectations.
All amounts are in Canadian dollars, unless otherwise
indicated.
SOURCE ADF Group Inc.