HIGHLIGHTS
(All amounts are in Canadian dollars,
unless otherwise indicated.)
- Revenues of $110.2 million and
$233.7 million recorded in the three
(3) month and nine (9) month periods ended October 31, 2021, respectively, representing
significant increases compared with the corresponding periods a
year earlier.
- Order backlog of $310.3 million
as at October 31, 2021.
- Net income of $8.7 million, for
the nine-month period ended October 31,
2021, up 82% from the same period a year earlier.
- Limited impact of COVID-19 on ADF's operations during the
nine-month period ended October 31,
2021.
Terrebonne, QC, Dec. 8, 2021 /CNW Telbec/ - ADF GROUP
INC. ("ADF" or the "Corporation") (TSX: DRX), recorded
revenues of $110.2 million during the
third quarter ended October 31, 2021,
compared with $47.2 million for the
same period a year earlier. After the first nine months of the
fiscal year, revenues totaled $233.7
million, which is $98.3
million more than the same period a year earlier, in line
with the growth of the order backlog in recent quarters.
Gross margin, as a percentage of revenues, went from 15.9% for
the 3-month period ended October 31,
2020, to 5.6% for the same period ended October 31, 2021. Gross margin, as a percentage
of revenues, went from 14.6%, during the nine-month period ended
October 31, 2020, to 8.4% for the same period ended
October 31, 2021. As indicated in the
press release of the previous quarter, these variations are mainly
explained by the pressure on margins brought by the start of
fabrication of a number of projects signed at lower prices.
For the quarter ended October 31,
2021, ADF recorded a net income of $2.8 million ($0.09
per share, basic and diluted) compared with a net income of
$2.6 million ($0.08 per share, basic and diluted) a year
earlier. At the close of the nine-month period, that is October
31, 2021, net income totaled $8.7
million ($0.27 per share,
basic and diluted) compared to net income of $4.8 million ($0.15
per share, basic and diluted) for the same period one year
earlier.
The Corporation's backlog stood at $310.3
million as at October 31,
2021, compared with $436.2
million as at January 31, 2021. The current order
backlog will extend until end of the fiscal year ending
January 31, 2023.
As of October 31, 2021, the
Corporation's working capital stood at $33.3
million. Operating activities generated $16.0 million in cash during the first nine
months ended October 31, 2021. The
Corporation remains in a good position to continue its current
operations and carry out its development projects.
Financial Highlights
New Contracts
|
3
Months
|
9
Months
|
|
|
|
|
|
Periods ended October
31,
|
2021
|
2020
|
2021
|
2020
|
(In thousands of
dollars, and dollars per share)
|
$
|
$
|
$
|
$
|
|
|
|
|
|
Revenues
|
110,189
|
47,158
|
233,747
|
135,451
|
Earnings before
interest, taxes, depreciation and amortization (EBITDA)
|
4,698
|
5,020
|
13,884
|
12,564
|
Net income
|
2,788
|
2,579
|
8,681
|
4,759
|
— Per share (basic
and diluted)
|
0.09
|
0.08
|
0.27
|
0.15
|
Cash flows from
operating activities
|
5,659
|
6,193
|
16,035
|
27,815
|
|
|
|
|
|
(In
thousands)
|
Number
|
Number
|
Number
|
Number
|
Average number of
outstanding shares (basic and diluted)
|
32,635
|
32,635
|
32,635
|
32,635
|
|
|
|
|
|
On September 9, 2021, the
Corporation announced the award of new contracts totalling nearly
$50.0 million, in Canada and the
United States, including an important one in the
transportation infrastructure sector in the Western USA. Fabrication work is scheduled to
begin in early 2022 at both ADF's fabrication plants located in
Terrebonne, Quebec and in
Great Falls, Montana, and run
until the fall of 2022, followed by the steel erection work of this
new structure at the job site, which is scheduled to extend
approximately over a 10-month period.
New Financing
The Corporation entered into a new financing agreement after
October 31, 2021.
The agreement was signed on November 9,
2021, in the amount of $30.0
million, of which $16.2
million will be used for the repayment of an existing debt,
and an amount of $13.8 million to
increase the Corporation's working capital. The Corporation will be
able to draw from this new source of financing once all the
statutory requirements and documents are finalized. The Corporation
is also working on other financing packages that should be
finalized before year-end.
Outlook
"The quarter ended October 31,
2021, was, like the previous one, impacted by the signing of
lower-priced contracts. Although these projects generate lower
margins that normally achieved by ADF, the significant volume of
steel being fabricated and erected still generates adequate
dollars," said Jean Paschini,
Chairman of the Board of Directors and Chief Executive Officer.
"We have added new contracts worth a total of $50.0 million to our order backlog at the start
of the quarter ended October 31, 2021 and we are
currently finalizing negotiation on several projects currently at
bid stage. The project pipeline in the markets served by ADF,
allows us to be optimistic and confident that we can continue the
growth of our order backlog'' concluded Mr. Paschini.
Dividend
On September 8, 2021, ADF Group
announced the payment of a semi-annual dividend of $0.01 per subordinate voting share and per
multiple voting shares, which was paid on October 15, 2021 to shareholders of record as of
September 30, 2021.
COVID-19
The Corporation has taken all necessary steps to protect its
employees and business partners, and will continue to follow the
advice and recommendations of local authorities wherever the
Corporation conducts business. These measures have resulted in
operational costs and inefficiencies that have been offset by the
government incentives previously mentioned. This situation is
changing rapidly and the Corporation will continue to monitor and
mitigate development affecting its personnel, suppliers, customers
and the general public to the extent it can.
Conference Call with Investors
A conference call with investors is scheduled for this morning,
December 8, 2021 at 10 a.m. (Montreal time) to discuss the results of
Corporation third quarter and nine-month period ended October 31, 2021.
To take part in the conference call, dial 1 (888) 380-0620, a
few minutes prior to the conference call scheduled start time.
Members of the media are invited to listen in.
A replay of this conference call will be available from
1:00 p.m. today, until Wednesday, December 15, 2021, by dialing
1 (888) 259-6562, followed by the access code
067141#.
The conference call (audio) will also be available at
www.adfgroup.com.
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-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
IFRS measures.
All amounts are in Canadian dollars, unless otherwise
indicated.
SOURCE ADF Group Inc.