HIGHLIGHTS
(All amounts are in Canadian dollars,
unless otherwise indicated.)
- Net income and gross margin for the 3-month and 6-month periods
ended July 31, 2020, up compared to
the same periods in 2019.
- Revenues of $42.5 million and
$88.3 million recorded during the
3-month and 6-month periods ended July 31,
2020, respectively.
- New contracts totalling $65.0
million signed during the period ended July 31, 2020.
- Order book totalling $314.5
million as at July 31,
2020.
- Limited impact of COVID-19 on ADF's operations during the first
semester ended July 31, 2020.
TERREBONNE, QC, Sept. 10, 2020 /CNW/ - ADF GROUP
INC. ("ADF" or the "Corporation") (TSX: DRX), recorded
revenues of $42.5 million during the
second quarter ended July 31, 2020,
compared with $54.1 million for the
same period a year earlier. After the first six months of the
fiscal year, revenues totaled $88.3
million, which is approximately $3.0
million lower than the same period a year earlier. These
decreases are mainly explained by the schedules of the various
projects during the periods analyzed.
Gross margin, as a percentage of revenues, went from 10.6% for
the three-month period ended July 31,
2019, to 17.4% for the same period ended July 31, 2020. Gross margin, as a percentage of
revenues, went from 12.6%, during the six-month period ended
July 31, 2019, to 13.9% for the same
period ended July 31, 2020. These
increases are mainly explained by the mix of ongoing projects in
our facilities during the periods analyzed, and by a better
absorption of fixed costs resulting from internal efficiency gains
achieved in our fabrication plants.
For the quarter ended July 31,
2020, ADF recorded a net income of $2.1 million ($0.06
per share, basic and diluted) compared with a net income of
$0.4 million ($0.01 per share, basic and diluted) a year
earlier. At the close of the first semester, being July
31, 2020, net income totaled $2.2
million ($ 0.07 per share,
basic and diluted) compared to net income of $ 2.0 million (0.06 $ per share, basic and
diluted) for the same period one year earlier.
The Corporation's backlog stood at $314.5
million as at July 31, 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.
As of July 31, 2020, the
Corporation's working capital stood at $35.4
million. Operating activities generated $21.6 million in cash during the first six months
ended July 31, 2020. As a result, as
at July 31, 2020, the Corporation's
net cash position improved by $23.8
million, compared with January 31,
2020. The Corporation remains in a good position to continue
its current operations and carry out its development projects.
Financial
Highlights
|
|
|
|
3
Months
|
6
Months
|
|
|
|
|
|
Periods ended July
31,
|
2020
|
2019
|
2020
|
2019
|
(In thousands of
dollars, and dollars per share)
|
$
|
$
|
$
|
$
|
Revenues
|
42,496
|
54,119
|
88,293
|
91,265
|
Earnings before
interest, taxes, depreciation and amortization (EBITDA)
|
4,577
|
3,012
|
7,544
|
6,031
|
Net income
|
2,112
|
419
|
2,180
|
2,037
|
— Per share (basic
and diluted)
|
0.06
|
0.01
|
0.07
|
0.06
|
Cash flows from
operating activities
|
9,575
|
3,570
|
21,622
|
754
|
(In
thousands)
|
Number
|
Number
|
Number
|
Number
|
Average number of
outstanding shares (basic and diluted)
|
32,635
|
32,635
|
32,635
|
32,635
|
Outlook
"Like many others, we continue to be in uncharted territory
during this pandemic. While our results for the quarter and first
six-month ended July 31, 2020, are
generally up from 2019, uncertainty remains for the coming months.
As such, we are maintaining the tight approach we have adopted in
terms of risk and liquidity management" said Jean Paschini, Co-Chairman of the Board of
Directors and Chief Executive Officer.
Dividend
On September 9, 2020, ADF Group
announced the payment of a semi-annual dividend of $0.01 per subordinate voting share and per share
with multiple voting rights, which will be paid on October 16, 2020 to shareholders of record as of
September 30, 2020.
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. However, as
of the date hereof, the number of employees per shift has
practically returned to the pre-pandemic levels. 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 this
morning, September 10, 2020, at
10 a.m. (Montreal time) to discuss the results of
periods ended July 31, 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 call will be available from
1:00 p.m. today, until midnight,
September 17, 2020, by dialing
1-888-390-0541, followed by the access code 277334
#.
The conference call (audio) will also be available at
www.adfgroup.com. Members of the media are invited to listen
in.
About ADF
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.
Website: www.adfgroup.com
SOURCE ADF Group Inc.