HIGHLIGHTS
- Revenues up 35% to $68.0 million
compared to the same period last year.
- Net income of $4.3 million.
- Order backlog at $325.4 million
as at April 30, 2022.
- New major contracts, totaling $90.0
million, signed since April 30,
2022.
TERREBONNE, QC, June 8, 2022
/CNW Telbec/ - (All amounts are in Canadian dollars unless
otherwise noted.)
ADF GROUP INC. ("ADF" or the "Corporation")
(TSX: DRX), a North American leader in the fabrication of steel
superstructures, recorded revenues of $68.0
million in the first quarter ended April 30, 2022, compared with $50.4 million for the same period a year
earlier.
Gross margin, as a percentage of revenue (1), went
from 15.4% in the three-month period ended April 30, 2021, to 12.1% for the same period
ended April 30, 2022. Gross
margin for the three months ended April 30,
2022, was affected downward by the temporary loss of
operational efficiency brought by the setting up of the all-new
robotic production line and new programmable and automated
equipment at our Terrebonne,
Quebec plant.
Adjusted earnings before interest, taxes, depreciation and
amortization (Adjusted EBITDA) (2) at $5.6 million is $0.5
million lower than as at April 30,
2021. The quarter ended April 30,
2021, benefited from a COVID-related grant totalling
$1.9 million which improved gross
margin by $1.6 million or 3.2% of
revenues, and reduced selling and administrative expenses by
$0.3 million. Excluding this
subsidy, gross margin, as a percentage of revenues, for the
quarters ended April 30, 2022 and
2021, would have been similar, while adjusted EBITDA as at
April 30, 2022, would have been
$1.4 million higher than at the same
date a year earlier.
For the first quarter ended April 30,
2022, ADF recorded a net income of $4.3 million ($0.13
per share, basic and diluted) compared with a net income of
$4.4 million ($0.13 per share, basic and diluted) for the same
period last year.
As at April 30, 2022, the
Corporation's order backlog (1) reached $325.4 million, compared with $373.1 million as at January 31, 2022.
As at April 30, 2022, the
Corporation had a working capital (1) of $54.4 million. The Corporation's operating
activities required liquidities of nearly $4.7 million for the three-month period ended
April 30, 2022. The Corporation
remains in sound position to continue its day-to-day operations and
pursue its development projects.
Financial Highlights (In thousands of dollars, and
dollars per share)
|
|
|
Three-Month Periods
Ended April 30,
|
2022
|
2021
|
Revenues
|
$68,008
|
$50,387
|
Adjusted EBITDA
(2)
|
$5,602
|
$6,112
|
Income before income
tax expense
|
$3,890
|
$4,496
|
Net income for the
period
|
$4,256
|
$4,395
|
—
Basic and diluted per share
|
$0.13
|
$0.13
|
(In
thousands)
|
Number
|
Number
|
Average number of
outstanding shares (basic and diluted)
|
32,635
|
32,635
|
|
|
|
New Contracts
On June 7, 2022, the Corporation
announced the signing of new major contracts, all in the automotive
sector in the U.S. Midwest region, with a total value of
$90.0 million.
These new orders consist in the fabrication, including the
supply of raw materials (steel) and industrial coating, as well as
the design and engineering of connections, and the delivery of
steel structures used in the construction of new large surface
industrial facilities. Fabrication work on these new projects
characterized by high tonnage and tight completion schedules, will
begin in the coming weeks at ADF's Terrebonne plant, and is scheduled to extend
until the first quarter of the fiscal year ending January 31, 2024.
Outlook
Mr. Jean Paschini,
Chairman of the Board of Directors and Chief Executive Officer,
indicated "the results for the quarter ended April 30, 2022, are encouraging. While our
operational efficiency was affected by the installation and
commissioning of our new automated equipment, which temporarily
impacted our margins downward, our quarterly revenues have
nonetheless recorded an increase compared with the same period last
year, and we have also been able to achieve an adequate net
income."
Conference call with
Investors
An investor conference call will be held this morning,
June 8, 2022, at 10 a.m. (EST) to discuss results for the first
quarter ended April 30, 2022.
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. on June 8, 2022, until midnight on Wednesday, June
15, 2022, by dialing 1 (888) 259-6562, followed by access code
613618 #.
The conference call (audio) will also be available at
www.adfgroup.com. Members of the media are invited to listen
in.
ANNUAL GENERAL MEETING OF
SHAREHOLDERS FOR THE FISCAL YEAR ENDED JANUARY 31, 2022
ADF Group Inc. will hold its Annual General Meeting of
Shareholders by way of a webcast, today, June 8, 2022, at 11 a.m.
(EST) available at
https://produceredition.webcasts.com/starthere.jsp?ei=1535918&tp_key=d894e14b3b
Shareholders are encouraged to vote on the matters before the
meeting by proxy and to view the meeting online by way of a live
webcast. Shareholders will be able to submit questions to
management of the Corporation through the webcast at any time and
at the conclusion of the Meeting. To this end, a dialogue box will
be available at the bottom of the screen allowing registered
shareholders to write their questions.
About ADF Group Inc. | ADF Group Inc. is a North American
leader in the design and engineering of connections, fabrication,
including the application of industrial coatings, and installation
of complex steel structures, heavy steel built-ups, as well as in
miscellaneous and architectural metals for the non-residential
infrastructure sector. 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, and a Construction Division in the United States, which specializes in the
installation of steel structures and other related products.
Forward-Looking Information | This press release
contains forward-looking statements reflecting ADF's 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.
Non-GAAP Financial Measures and Other Financial
Measures | Are measures derived primarily from the
consolidated financial statements, but are not a standardized
financial measure under the financial reporting framework used to
prepare the Corporation's financial statements. Therefore, readers
should be careful not to confuse or substitute them with
performance measures prepared in accordance with GAAP. In addition,
readers should avoid comparing these non-GAAP financial measures to
similarly titled measures provided or used by other issuers. The
definition of these indicators and their reconciliation with
comparable International Financial Reporting Standards measure is
as follows:
Adjusted EBITDA
Adjusted EBITDA shows the extent to which the Corporation
generates profits from operations, without considering the
following items:
- Financial revenues and financial expenses;
- Income tax expense;
- Foreign exchange losses, and
- Depreciation and amortization of property, plant and equipment,
intangible assets and right-of-use assets.
Net income is reconciled with adjusted EBITDA in the table
below:
|
|
|
Three (3) Month Periods
Ended April 30,
|
2022
|
2021
|
(In thousands of
dollars)
|
|
|
Net income
|
$4,256
|
$4,395
|
Income tax expense
(recovery)
|
$(366)
|
$101
|
Net financial
expenses
|
$198
|
$293
|
Amortization
|
$1,183
|
$1,215
|
Foreign exchange
loss
|
$331
|
$108
|
Adjusted
EBITDA
|
$5,602
|
$6,112
|
|
|
|
Gross Margin as a Percentage of
Revenues
Gross margin as a percentage of revenue indicator is used by the
Corporation to assess the level of profitability for a given period
based on the project mix for that same period. This indicator is
subject to fluctuations in project prices and also in the
operational efficiency of the Corporation. The indicator of gross
margin as a percentage of revenues results from dividing gross
margin by revenues.
Order Backlog
The order backlog is a measure used by the Corporation to assess
future revenue levels. The order backlog includes firm orders
obtained by the Corporation, either through a firm contract or a
formal notice to proceed confirmed by the client. The order backlog
disclosed by the Corporation therefore includes the portion of
confirmed contracts that have not been put into production.
Working Capital
The working capital indicator is used by the Corporation to
assess whether current assets are sufficient to meet current
liabilities. Working capital is equal to current assets, less
current liabilities.
(1)
|
Gross margin, as a
percentage of revenues, working capital, as well as the order
backlog are additional financial measures. Refer to the "Non-GAAP
Financial Measures and Other Financial Measures" section of this
press release for the definition of these indicators.
|
(2)
|
Adjusted EBITDA is a
non-GAAP financial measure. Refer to the "Non-GAAP Financial
Measures and Other Financial Measures" section of this press
release for the definition of this indicator.
|
SOURCE ADF Group Inc.