Acadian Timber Corp. (“Acadian” or the “Company”) (TSX:ADN) today
reported financial and operating results1 for the three months and
full year ended December 31, 2020.
“Acadian performed well and generated solid
results for the year ended December 31, 2020, despite the global
pandemic, elevated regional pulpwood inventories and adverse
weather events experienced throughout the year. The Company
responded to these challenges while protecting margins and growing
its customer base,” commented Erika Reilly, Chief Executive
Officer. “As we look forward to the year ahead, we are encouraged
by the outlook for the end use markets of our key products, and
will be focused on continuing to merchandise our products to
maximize value while seeking growth and further cost savings
opportunities."
Adjusted EBITDA for the year ended December 31,
2020 was $21.5 million, compared to $23.6 million in the prior
year, while Adjusted EBITDA margin remained consistent with the
prior year at 24%. Low pulpwood sales combined with lower gains on
timberland sales were partially offset by lower overall costs and
strong softwood sawlogs sales from the New Brunswick operation.
Free Cash Flow was $15.2 million compared to $18.7 million in
2019.
Acadian declared dividends of $19.4 million or
$1.16 per share to our shareholders during the year.
Acadian’s balance sheet remains solid with the
refinancing of Acadian’s long-term debt complete and $22.8 million
of net liquidity as at December 31, 2020, which includes funds
available under our credit facilities.
Review of Operations
Financial and Operating Highlights
|
Three Months Ended |
Year Ended |
(CAD thousands) |
December 31, 2020 |
December 31, 2019 |
December 31, 2020 |
December 31, 2019 |
Sales volume (000s m3) |
|
321.2 |
|
339.4 |
|
1,138.1 |
|
1,251.1 |
Sales |
$ |
24,929 |
$ |
25,835 |
$ |
91,031 |
$ |
100,048 |
Operating earnings |
|
6,838 |
|
6,296 |
|
20,829 |
|
22,233 |
Net income / (loss) |
|
15,314 |
|
16,228 |
|
22,080 |
|
17,325 |
Adjusted EBITDA |
$ |
7,288 |
$ |
6,586 |
$ |
21,485 |
$ |
23,604 |
Adjusted EBITDA margin |
|
29% |
|
25% |
|
24% |
|
24% |
Free Cash Flow |
$ |
5,648 |
$ |
5,296 |
$ |
15,153 |
$ |
18,722 |
Dividends declared |
|
4,839 |
|
4,839 |
|
19,357 |
|
19,358 |
Payout ratio |
|
86% |
|
91% |
|
128% |
|
103% |
Per share – basic and diluted |
|
|
|
|
Net income |
$ |
0.92 |
$ |
0.97 |
$ |
1.32 |
$ |
1.04 |
Free Cash Flow |
|
0.34 |
|
0.32 |
|
0.91 |
|
1.12 |
Dividends declared |
|
0.29 |
|
0.29 |
|
1.16 |
|
1.16 |
Acadian generated sales of $91.0 million,
compared to $100.0 million in the prior year. Sales volume,
excluding biomass, decreased 10% mostly due to lower hardwood and
softwood pulpwood sales. Acadian’s weighted average selling price,
excluding biomass, was flat year-over-year with a higher value
product mix offset by lower value sawlogs sold in 2020.
Operating costs and expenses were $70.2 million
during 2020, compared to $77.8 million in the prior year due to
lower harvesting activity and administrative costs. Weighted
average variable costs, excluding biomass, were flat
year-over-year.
Adjusted EBITDA for the year ended December 31,
2020 was $21.5 million, compared to $23.6 million in the prior
year, while Adjusted EBITDA margin remained consistent with the
prior year at 24%.
Net Income for the year ended December 31, 2020
totaled $22.1 million, or $1.32 per share, compared to net income
of $17.3 million, or $1.04 per share, in 2019. The variance from
the prior year is primarily due to the termination fee paid to
Brookfield in 2019 which, after income tax, reduced net income by
$12.8 million or $0.77 per share. Net income was also impacted by a
combination of non-cash items such as unrealized foreign exchange
on long-term debt and fair value adjustments in 2020 compared to
2019.
Segment Performance
New Brunswick Timberlands
The table below summarizes operating and
financial results for New Brunswick Timberlands.
|
Three Months Ended December 31, 2020 |
Three Months Ended December 31, 2019 |
|
Harvest |
Sales |
Sales |
Results |
Harvest |
Sales |
Sales |
Results |
|
(000s m3) |
(000s m3) |
Mix |
($000s) |
(000s m3) |
(000s m3) |
Mix |
($000s) |
Softwood |
131.1 |
126.1 |
51% |
|
$ |
7,846 |
|
104.3 |
108.5 |
43% |
|
$ |
6,207 |
Hardwood |
81.7 |
84.2 |
34% |
|
|
6,323 |
|
109.3 |
97.1 |
39% |
|
|
7,325 |
Biomass |
39.3 |
39.3 |
15% |
|
|
871 |
|
44.6 |
44.6 |
18% |
|
|
1,352 |
|
252.1 |
249.6 |
100% |
|
|
15,040 |
|
258.2 |
250.2 |
100% |
|
|
14,884 |
Timber services and other |
|
|
|
|
|
4,289 |
|
|
|
|
|
|
3,921 |
Sales |
|
|
|
|
$ |
19,329 |
|
|
|
|
|
$ |
18,805 |
Adjusted EBITDA |
|
|
|
|
$ |
6,481 |
|
|
|
|
|
$ |
5,211 |
Adjusted EBITDA margin |
|
|
|
|
34% |
|
|
|
|
|
|
28% |
|
Year ended December 31, 2020 |
Year ended December 31, 2019 |
|
Harvest |
Sales |
Sales |
Results |
Harvest |
Sales |
Sales |
Results |
|
(000s m3) |
(000s m3) |
Mix |
($000s) |
(000s m3) |
(000s m3) |
Mix |
($000s) |
Softwood |
413.6 |
410.3 |
48% |
|
$ |
24,034 |
|
395.7 |
411.8 |
44% |
|
$ |
24,024 |
Hardwood |
293.2 |
307.5 |
36% |
|
|
23,585 |
|
373.6 |
371.1 |
40% |
|
|
28,174 |
Biomass |
142.5 |
142.5 |
16% |
|
|
4,181 |
|
143.6 |
143.6 |
16% |
|
|
4,906 |
|
849.3 |
860.3 |
100% |
|
|
51,770 |
|
912.9 |
926.5 |
100% |
|
|
57,104 |
Timber services and other |
|
|
|
|
16,763 |
|
|
|
|
|
17,068 |
Sales |
|
|
|
$ |
68,533 |
|
|
|
|
$ |
74,172 |
Adjusted EBITDA |
|
|
|
$ |
18,382 |
|
|
|
|
$ |
18,599 |
Adjusted EBITDA margin |
|
|
|
27% |
|
|
|
|
|
25% |
Sales for New Brunswick Timberlands totaled
$68.5 million, compared to $74.2 million in 2019. Sales volume,
excluding biomass, decreased 8% primarily due to lower hardwood and
softwood pulpwood sales, partially offset by higher softwood
sawlogs sales. While demand for our softwood sawlogs increased due
to a strong softwood lumber market, demand for our hardwood and
softwood pulpwood was lower compared to 2019. Biomass sales volume
remained relatively stable, and revenues from timber services and
other sales decreased 2% due to slightly lower operating activity
than in the prior year.
The weighted average selling price, excluding
biomass, during the year was $66.34 per m3, flat year-over-year due
to a favourable product mix on softwood, partially offset by lower
hardwood pulpwood volumes and price compared to the prior year.
Operating costs and expenses were $50.3 million
during 2020, compared to $56.2 million in the prior year due to
lower harvesting activity and costs. Weighted average variable
costs, excluding biomass, decreased 3% due to lower hardwood
deliveries and less log processing compared to the prior year.
Adjusted EBITDA for the year ended December 31,
2020 was $18.4 million, compared to $18.6 million in the prior
year, reflecting the strong softwood sawlogs sales and lower costs,
offset by the lower hardwood pulpwood sales and $0.5 million gain
on the sale of timberlands in 2019. The Adjusted EBITDA margin for
the year increased to 27% from 25% in the prior year.
There was one recordable safety incident among
employees and no incidents among contractors during the fourth
quarter.
Maine Timberlands
The table below summarizes operating and
financial results for Maine Timberlands.
|
Three Months Ended December 31, 2020 |
Three Months Ended December 31, 2019 |
|
Harvest |
Sales |
Sales |
Results |
Harvest |
Sales |
Sales |
Results |
|
(000s m3) |
(000s m3) |
Mix |
($000s) |
(000s m3) |
(000s m3) |
Mix |
($000s) |
Softwood |
45.0 |
45.0 |
63% |
$ |
3,231 |
|
71.1 |
71.0 |
80% |
$ |
5,325 |
Hardwood |
26.2 |
26.2 |
37% |
|
2,173 |
|
17.9 |
18.2 |
20% |
|
1,532 |
Biomass |
0.4 |
0.4 |
0% |
|
5 |
|
— |
— |
— |
|
— |
|
71.6 |
71.6 |
100% |
|
5,409 |
|
89.0 |
89.2 |
100% |
|
6,857 |
Other sales |
|
|
|
|
191 |
|
|
|
|
|
173 |
Sales |
|
|
|
$ |
5,600 |
|
|
|
|
$ |
7,030 |
Adjusted EBITDA |
|
|
|
$ |
1,346 |
|
|
|
|
$ |
2,119 |
Adjusted EBITDA margin |
|
|
|
24% |
|
|
|
|
|
30% |
|
Year Ended December 31, 2020 |
Year Ended December 31, 2019 |
|
Harvest |
Sales |
Sales |
Results |
Harvest |
Sales |
Sales |
Results |
|
(000s m3) |
(000s m3) |
Mix |
($000s) |
(000s m3) |
(000s m3) |
Mix |
($000s) |
Softwood |
185.9 |
186.0 |
67% |
$ |
14,037 |
|
234.2 |
234.3 |
72% |
$ |
17,796 |
Hardwood |
95.7 |
91.2 |
33% |
|
7,838 |
|
86.6 |
86.5 |
27% |
|
7,426 |
Biomass |
0.6 |
0.6 |
0% |
|
9 |
|
3.8 |
3.8 |
1% |
|
12 |
|
282.2 |
277.8 |
100% |
|
21,884 |
|
324.6 |
324.6 |
100% |
|
25,234 |
Other sales |
|
|
|
|
614 |
|
|
|
|
|
642 |
Sales |
|
|
|
$ |
22,498 |
|
|
|
|
$ |
25,876 |
Adjusted EBITDA |
|
|
|
$ |
5,304 |
|
|
|
|
$ |
6,713 |
Adjusted EBITDA margin |
|
|
|
24% |
|
|
|
|
|
26% |
Sales for our Maine Timberlands were $22.5
million compared to $25.9 million in 2019. Sales volume, excluding
biomass, decreased by 14% as customers were slow to take softwood
pulpwood deliveries due to continued high inventories in the region
and softwood sawlog sales were impacted by unfavourable operating
conditions during the fourth quarter.
The weighted average selling price, excluding
biomass, in Canadian dollar terms was $78.90 per m3, compared to
$78.62 per m3 in 2019. In U.S dollar terms, the weighted average
selling price, excluding biomass, was $59.13 per m3, flat
year-over-year due to a favourable product mix overall offset by
lower quality sawlogs in the mix.
Operating costs and expenses for 2020 were $17.7
million, compared to $19.9 million in 2019 primarily due to lower
harvesting activity and administrative costs. Weighted average
variable costs, excluding biomass, were higher due primarily to
more hardwood in the mix and longer hauling distances to
market.
Adjusted EBITDA for the year ended December 31,
2020 was $5.3 million compared to $6.7 million in the prior year
and adjusted EBITDA margin was 24% compared to 26% in 2019. Lower
adjusted EBITDA was primarily the result of lower sales volumes and
$0.6 million gain on the sale of timberlands in 2019.
There were no recordable safety incidents among
employees or contractors during the fourth quarter.
Market
Outlook
The outlook for Acadian’s softwood and hardwood
sawlog sales is positive with end use markets showing strength as
we head into 2021. Markets for pulpwood and biomass are
mixed.
North American softwood lumber consumption is
expected to remain strong, with sustained demand from repair and
remodeling activity and increased demand from new home
construction. Consensus forecast is for approximately 1.44
million U.S. housing starts in 2021 as compared to 1.38 million in
2020. Low interest rates, a large U.S. population entering
their home buying years, and a low inventory of homes for sale are
key drivers supporting this growth. With this backdrop, Acadian’s
softwood sawmill customers are expected to continue to operate at
full capacity, providing steady demand for our softwood
sawlogs.
End use markets for hardwood lumber are
strengthening while hardwood sawlog availability regionally is
limited given the heavy focus on cutting softwoods instead of
hardwoods. Acadian expects to realize continued strong demand
for its hardwood sawlogs as we enter 2021 and to benefit from new
customer relationships developed in 2020.
Demand for Acadian’s hardwood pulpwood is
improving with increasing customer confidence and market demand for
hardwood pulp. We remain cautiously optimistic that this
improvement will be sustained through 2021. Meanwhile,
markets for softwood pulpwood are expected to remain challenged
given elevated regional inventories of both softwood pulpwood and
sawmill residuals.
Demand for biomass from Acadian’s New Brunswick
operation, which is mostly hardwood, continues to be steady, with
several new customer relationships developed in 2020.
Quarterly Dividend
Based on a strong balance sheet and outlook for
the remainder of the year, Acadian is pleased to announce a
dividend of $0.29 per share, payable on April 15, 2021 to
shareholders of record on March 31, 2021.
Acadian Timber Corp.
(“Acadian”, the “Company” or “we”) is a leading supplier of primary
forest products in Eastern Canada and the Northeastern U.S. With a
total of approximately 2.4 million acres of land under management,
Acadian is one of the largest timberland operators in New Brunswick
and Maine.
Acadian owns and manages approximately 761,000
acres of freehold timberlands in New Brunswick (“New Brunswick
Timberlands” or “NB Timberlands”), approximately 300,000 acres of
freehold timberlands in Maine (“Maine Timberlands”) 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’s business strategy is to maximize cash
flows from its existing timberland assets while growing our
business by acquiring assets on a value basis and utilizing our
operations-oriented approach 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:
Adam SheparskiChief Financial OfficerTel:
506-737-2345 Email: ir@acadiantimber.com
Cautionary Statement Regarding
Forward-Looking Information and Statements
This MD&A 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, or industry results, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. When used in this MD&A, such forward-looking
statements may contain such words as “may,” ”will,” “intend,”
“should,” “suggest,” ”expect,” “believe,” “outlook,” “forecast,”
“predict,” “remain,” “anticipate,” “estimate,” “potential,”
“continue,” “plan,” “could,” “might,” “project,” “targeting” or the
negative of these terms or other similar terminology.
Forward-looking information is included in the Letter to
Shareholders which precedes this MD&A and includes statements
made in this MD&A in sections entitled “Dividend Policy of the
Company” and “Market 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. These statements, which reflect management’s
current expectations regarding future events and operating
performance, are based on information currently available to
management and speak only as of the date of this MD&A. All
forward-looking statements in this MD&A 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. Factors that could
cause actual results to differ materially from the results
discussed in the forward-looking statements include, but are not
limited to: general economic and market conditions; changes in US
housing starts; product demand; concentration of customers;
commodity pricing; interest rate and foreign currency fluctuations;
seasonality; weather and natural conditions; regulatory, trade or
environmental policy changes; changes in Canadian or U.S. income
tax law; economic situation of key customers; disease outbreak;
Acadian’s ability to source and secure potential investment
opportunities; the availability of potential acquisitions that suit
Acadian’s growth profile; and other risks and factors discussed
under the heading “Risk Factors” in the Annual Report dated
February 10, 2021 and in each of the Annual Information Form dated
March 27, 2020 and the Management Information Circular dated March
27, 2020, and other filings of Acadian made with securities
regulatory authorities, which are available on SEDAR at
www.sedar.com. Forward-looking information is based on various
material factors or assumptions, which are based on information
currently available to Acadian. Material factors or assumptions
that were applied in drawing a conclusion or making an estimate set
out in the forward-looking information may include, but are not
limited to: forecasts in the housing market; anticipated financial
performance; anticipated market conditions; business prospects; the
economic situation of key customers; strategies; regulatory
developments; exchange rates; the sufficiency of budgeted capital
expenditures in carrying out planned activities; the availability
and cost of labour and services; and the ability to obtain
financing on acceptable terms. Readers are cautioned that the
preceding list of material factors or assumptions is not
exhaustive. Although the forward-looking statements contained in
this MD&A 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 MD&A are made as of the
date of this MD&A, and should not be relied upon as
representing Acadian’s views as of any date subsequent to the date
of this MD&A. 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.Consolidated Balance Sheets
(unaudited)
As at(CAD thousands) |
December 31, 2020 |
December 31, 2019 |
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash |
$ |
10,258 |
$ |
7,601 |
Accounts receivable and other assets |
|
7,731 |
|
11,602 |
Current income taxes receivable |
|
415 |
|
2,245 |
Inventory |
|
957 |
|
1,545 |
|
|
19,361 |
|
22,993 |
|
|
|
|
|
Timber |
|
388,005 |
|
377,992 |
Land, roads and other fixed assets |
|
99,892 |
|
91,584 |
Intangible asset |
|
6,140 |
|
6,140 |
Total assets |
$ |
513,398 |
$ |
498,709 |
|
|
|
|
|
Liabilities and shareholders’ equity |
|
|
|
|
Current liabilities |
|
|
|
|
Short-term debt |
$ |
— |
$ |
7,793 |
Accounts payable and accrued liabilities |
|
8,640 |
|
9,190 |
Dividends payable to shareholders |
|
4,839 |
|
4,839 |
Current portion of long-term debt |
|
— |
|
93,084 |
|
|
13,479 |
|
114,906 |
|
|
|
|
|
Long-term debt |
|
101,185 |
|
— |
Deferred income tax liabilities |
|
105,493 |
|
97,102 |
Shareholders’ equity |
|
293,241 |
|
286,701 |
Total liabilities and shareholders’ equity |
$ |
513,398 |
$ |
498,709 |
Acadian Timber
Corp.Consolidated Statements of Net
Income
(unaudited)
|
|
Three Months Ended |
|
Year Ended |
(CAD thousands, except per share data) |
December 31, 2020 |
|
December 31, 2019 |
|
December 31, 2020 |
|
December 31, 2019 |
Sales |
$ |
24,929 |
|
$ |
25,835 |
|
$ |
91,031 |
|
$ |
100,048 |
Operating costs and expenses |
|
|
|
|
|
|
|
|
Cost of sales |
|
16,193 |
|
|
17,360 |
|
|
60,897 |
|
|
67,260 |
Selling, administration and other |
|
1,717 |
|
|
2,079 |
|
|
7,991 |
|
|
9,491 |
Silviculture |
|
107 |
|
|
29 |
|
|
1,034 |
|
|
778 |
Depreciation and amortization |
|
74 |
|
|
71 |
|
|
280 |
|
|
286 |
|
|
18,091 |
|
|
19,539 |
|
|
70,202 |
|
|
77,815 |
Operating earnings |
|
6,838 |
|
|
6,296 |
|
|
20,829 |
|
|
22,233 |
Interest expense, net |
|
(719) |
|
|
(1,141) |
|
|
(4,324) |
|
|
(4,130) |
Other items |
|
|
|
|
|
|
|
|
Fair value adjustments and other |
|
8,140 |
|
|
14,494 |
|
|
12,001 |
|
|
15,903 |
Unrealized exchange gain on long-term debt |
|
5,312 |
|
|
1,826 |
|
|
2,372 |
|
|
4,733 |
Management agreement termination fee |
|
— |
|
|
— |
|
|
— |
|
|
(18,000) |
Gain on sale of timberlands |
|
376 |
|
|
192 |
|
|
376 |
|
|
1,056 |
Gain on disposal of other fixed assets |
|
— |
|
|
27 |
|
|
— |
|
|
29 |
Earnings before income tax |
|
19,947 |
|
|
21,694 |
|
|
31,254 |
|
|
21,824 |
Current income tax expense |
|
(839) |
|
|
(446) |
|
|
(2,709) |
|
|
(111) |
Deferred income tax expense |
|
(3,794) |
|
|
(5,020) |
|
|
(6,465) |
|
|
(4,388) |
Net income |
$ |
15,314 |
|
$ |
16,228 |
|
$ |
22,080 |
|
$ |
17,325 |
Net income per share – basic and diluted |
$ |
0.92 |
|
$ |
0.97 |
|
$ |
1.32 |
|
$ |
1.04 |
Acadian Timber
Corp.Consolidated Statements of Comprehensive
Income
(unaudited)
|
|
Three Months Ended |
|
Year Ended |
(CAD thousands) |
December 31, 2020 |
|
December 31, 2019 |
|
December 31, 2020 |
|
December 31, 2019 |
Net income |
$ |
15,314 |
|
$ |
16,228 |
|
$ |
22,080 |
|
$ |
17,325 |
Other comprehensive (loss) / income |
|
|
|
|
|
|
|
|
Items that may be reclassified subsequently to net income: |
|
|
|
|
|
|
|
|
Deferred income tax expense |
|
(2,598) |
|
|
(2,191) |
|
|
(2,598) |
|
|
(2,184) |
Gain on revaluation of land and roads |
|
9,040 |
|
|
7,614 |
|
|
9,040 |
|
|
7,591 |
Unrealized foreign currency translation loss |
|
(7,007) |
|
|
(2,601) |
|
|
(2,625) |
|
|
(7,048) |
Comprehensive income |
$ |
14,749 |
|
$ |
19,050 |
|
$ |
25,897 |
|
$ |
15,684 |
Acadian Timber
Corp.Consolidated Statements of Cash
Flows
(unaudited)
|
Three Months Ended |
|
Year Ended |
(CAD thousands) |
December 31, 2020 |
|
December 31, 2019 |
|
December 31, 2020 |
|
December 31, 2019 |
Cash provided by (used for): |
|
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
|
|
|
|
Net income |
$ |
15,314 |
|
$ |
16,228 |
|
$ |
22,080 |
|
$ |
17,325 |
|
Adjustment to net income: |
|
|
|
|
|
|
|
|
Deferred income tax expense |
|
3,794 |
|
|
5,020 |
|
|
6,465 |
|
|
4,388 |
|
Depreciation and amortization |
|
74 |
|
|
71 |
|
|
280 |
|
|
286 |
|
Fair value adjustments and other |
|
(8,140 |
) |
|
(14,494 |
) |
|
(12,001 |
) |
|
(15,903 |
) |
Unrealized exchange gain on long-term debt |
|
(5,312 |
) |
|
(1,826 |
) |
|
(2,372 |
) |
|
(4,733 |
) |
Gain on sale of timberlands |
|
(376 |
) |
|
(192 |
) |
|
(376 |
) |
|
(1,056 |
) |
Gain on disposal of other fixed assets |
|
— |
|
|
(27 |
) |
|
— |
|
|
(29 |
) |
Accretion of long-term debt |
|
— |
|
|
274 |
|
|
1,038 |
|
|
1,135 |
|
Net change in non-cash working capital balances and other |
|
1,958 |
|
|
(3,439 |
) |
|
5,503 |
|
|
(5,553 |
) |
|
|
7,312 |
|
|
1,615 |
|
|
20,617 |
|
|
(4,140 |
) |
Financing activities |
|
|
|
|
|
|
|
|
Proceeds from short-term debt |
|
— |
|
|
— |
|
|
— |
|
|
7,793 |
|
Issuance of long-term debt |
|
86,730 |
|
|
— |
|
|
106,525 |
|
|
— |
|
Repayment of short-term debt |
|
— |
|
|
(2,137 |
) |
|
(8,169 |
) |
|
— |
|
Repayment of long-term debt |
|
(86,730 |
) |
|
|
|
(96,459 |
) |
|
— |
|
Deferred financing costs |
|
(5 |
) |
|
(175 |
) |
|
(532 |
) |
|
(175 |
) |
Dividends paid to shareholders |
|
(4,839 |
) |
|
(4,839 |
) |
|
(19,357 |
) |
|
(19,233 |
) |
Common shares purchased under NCIB |
|
— |
|
|
— |
|
|
— |
|
|
(37 |
) |
|
|
(4,844 |
) |
|
(7,151 |
) |
|
(17,992 |
) |
|
(11,652 |
) |
Investing activities |
|
|
|
|
|
|
|
|
Additions to timber, land, roads and other fixed assets |
|
1 |
|
|
— |
|
|
(351 |
) |
|
(86 |
) |
Proceeds from sale of timberlands |
|
383 |
|
|
210 |
|
|
383 |
|
|
1,130 |
|
Proceeds from sale of other fixed assets |
|
— |
|
|
27 |
|
|
— |
|
|
29 |
|
|
|
384 |
|
|
237 |
|
|
32 |
|
|
1,073 |
|
Increase / (decrease) in cash during the period |
|
2,852 |
|
|
(5,299 |
) |
|
2,657 |
|
|
(14,719 |
) |
Cash beginning of period |
|
7,406 |
|
|
12,900 |
|
|
7,601 |
|
|
22,320 |
|
Cash end of period |
$ |
10,258 |
|
$ |
7,601 |
|
$ |
10,258 |
|
$ |
7,601 |
|
Reconciliations to Adjusted EBITDA and
Free Cash Flow
|
Three Months Ended |
Year Ended |
(CAD thousands) |
December 31, 2020 |
December 31, 2019 |
December 31, 2020 |
December 31, 2019 |
Net income / (loss) |
$ |
15,314 |
|
$ |
16,228 |
|
$ |
22,080 |
|
$ |
17,325 |
|
Add / (deduct) |
|
|
|
|
|
|
|
|
Interest expense, net |
|
719 |
|
|
1,141 |
|
|
4,324 |
|
|
4,130 |
|
Current income tax expense |
|
839 |
|
|
446 |
|
|
2,709 |
|
|
111 |
|
Deferred income tax expense |
|
3,794 |
|
|
5,020 |
|
|
6,465 |
|
|
4,388 |
|
Depreciation and amortization |
|
74 |
|
|
71 |
|
|
280 |
|
|
286 |
|
Fair value adjustments and other |
|
(8,140 |
) |
|
(14,494 |
) |
|
(12,001 |
) |
|
(15,903 |
) |
Management agreement termination fee |
|
— |
|
|
— |
|
|
— |
|
|
18,000 |
|
Unrealized exchange gain on long-term debt |
|
(5,312 |
) |
|
(1,826 |
) |
|
(2,372 |
) |
|
(4,733 |
) |
Adjusted EBITDA |
$ |
7,288 |
|
$ |
6,586 |
|
$ |
21,485 |
|
$ |
23,604 |
|
Add / (deduct) |
|
|
|
|
|
|
|
|
Interest paid on debt, net |
|
(809 |
) |
|
(785 |
) |
|
(3,279 |
) |
|
(2,834 |
) |
Additions to timber, land, roads and other fixed assets |
|
1 |
|
|
— |
|
|
(351 |
) |
|
(86 |
) |
Gain on sale of timberlands |
|
(376 |
) |
|
(192 |
) |
|
(376 |
) |
|
(1,056 |
) |
Gain on disposal of other fixed assets |
|
— |
|
|
(27 |
) |
|
— |
|
|
(29 |
) |
Proceeds on sale of timberlands |
|
383 |
|
|
210 |
|
|
383 |
|
|
1,130 |
|
Proceeds on sale of other fixed assets |
|
— |
|
|
27 |
|
|
— |
|
|
29 |
|
Current tax effect of termination fee |
|
— |
|
|
(77 |
) |
|
— |
|
|
(1,925 |
) |
Current income tax expense |
|
(839 |
) |
|
(446 |
) |
|
(2,709 |
) |
|
(111 |
) |
Free Cash Flow |
$ |
5,648 |
|
$ |
5,296 |
|
$ |
15,153 |
|
$ |
18,722 |
|
Dividends declared |
$ |
4,839 |
|
$ |
4,839 |
|
$ |
19,357 |
|
$ |
19,358 |
|
Payout Ratio |
|
86 |
% |
|
91 |
% |
|
128 |
% |
|
103 |
% |
________________________________________
1 This news release makes reference to
Adjusted EBITDA, Adjusted EBITDA margin, Free Cash Flow and Payout
Ratio which are key performance measures in evaluating Acadian’s
operations and are important in enhancing investors’ understanding
of Acadian’s operating performance. Adjusted EBITDA and Adjusted
EBITDA margin 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 the Payout Ratio
is used to evaluate Acadian’s ability to fund its distribution
using Free Cash Flow. Acadian’s management defines Adjusted EBITDA
as earnings before interest, taxes, fair value adjustments,
recovery of or impairment of land and roads, realized gain/loss on
sale of roads and other fixed assets, unrealized exchange gain/loss
on debt, depreciation and amortization and Adjusted EBITDA margin
as Adjusted EBITDA as a percentage of its total revenue. Free Cash
Flow is defined as Adjusted EBITDA less interest paid, current
income tax expense, and capital expenditures plus net proceeds from
the sale of fixed assets (selling price less gains or losses
included in Adjusted EBITDA). Payout Ratio is defined as dividends
declared divided by Free Cash Flow. As these performance measures
do not have standardized meanings prescribed by International
Financial Reporting Standards (“IFRS”), they may not be comparable
to similar measures presented by other companies. As a result, we
have provided in this news release reconciliations of net income,
as determined in accordance with IFRS, to Adjusted EBITDA, Adjusted
EBITDA margin and Free Cash Flow.
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