HIGHLIGHTS
(All amounts are in Canadian dollars,
unless otherwise indicated.)
- Revenues of $134.4 million
recorded during the 6-month period ended July 31, 2022, higher when compared with the same
period a year ago.
- Net income of $5.4 million and
$9.7 million recorded during the
3-month and 6-month periods ended July 31,
2022, respectively higher when compared with the same period
a year ago.
- Order backlog (1) totalling $348.3 million as at July
31, 2022.
TERREBONNE, QC, Sept. 8,
2022 /CNW Telbec/ - ADF GROUP INC. ("ADF"
or the "Corporation"), Ticker symbol: (TSX: DRX), recorded revenues
of $66.4 million during the second
quarter ended July 31, 2022, compared
with $73.2 million for the same
period a year earlier. After the first six months of the fiscal
year, revenues totaled $134.4
million, which is $10.8
million higher than the same period a year earlier.
Gross margin, as a percentage of revenues (1)
went from 7.7% for the 3-month period ended July 31, 2021, to 12.9% for the same period ended
July 31, 2022. Gross margin, as a
percentage of revenues (1), went from 10.9%, during the
first semester ended July 31, 2021, to 12.5% for the same
period ended July 31, 2022. This
increase is mainly due to the fabrication product mix and the
forgiveness, during the quarter ended July
31, 2022, of a $1.3 million
(US$1.0 million) loan issued to a
U.S. affiliate of the Corporation, as part of a U.S. government
program in response to COVID-19.
Adjusted earnings before interest, taxes, depreciation and
amortization (Adjusted EBITDA) (2) for the 6-month
period ended July 31, 2022, at $12.7 million, is $3.5
million higher than as at July 31, 2021. The 6-month
period ended July 31, 2022, benefited
from a $0.8 million gain on disposal
of assets which was recognized during the quarter ended
July 31, 2022, whereas the first
semester ended July 31, 2021,
benefited from a $1.9 million
COVID-related grant which improved gross margin by $1.6 million or 3.2% of revenues (1),
and reduced selling and administrative expenses by $0.3 million.
For the quarter ended July 31,
2022, ADF recorded a net income of $5.4 million ($0.17
per share, basic and diluted) compared with a net income of
$1.5 million ($0.05 per share, basic and diluted) a year
earlier. At the close of the first semester, on
July 31, 2022, net income totalled $9.7 million ($0.30
per share, basic and diluted) compared to net income of
$5.9 million ($0.18 per share, basic and diluted) for the
same period one year earlier.
The Corporation's order backlog (1) stood at
$348.3 million as at July 31, 2022, compared with $373.1 million as at January 31, 2022. The current order backlog will
extend until end of the fiscal year ending January 31, 2024.
As of July 31, 2022, the
Corporation's working capital (1) stood at $56.2 million. Operating activities required
$6.8 million in cash during the first
6-month period ended July 31, 2022.
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,
|
2022
|
2021
|
2022
|
2021
|
(In thousands of
dollars, and dollars per share)
|
$
|
$
|
$
|
$
|
Revenues
|
66,382
|
73,171
|
134,390
|
123,558
|
Adjusted EBITDA
(2)
|
7,101
|
3,074
|
12,703
|
9,186
|
Income before income
tax expense (recovery)
|
5,746
|
1,362
|
9,636
|
5,858
|
Net income for the
period
|
5,426
|
1,498
|
9,682
|
5,893
|
— Per share (basic and
diluted)
|
0.17
|
0.05
|
0.30
|
0.18
|
(In
thousands)
|
Number
|
Number
|
Number
|
Number
|
Average number of
outstanding shares (basic and diluted)
|
32,640
|
32,635
|
32,640
|
32,635
|
|
|
|
|
|
Outlook
"For a second consecutive quarter, the results are adequate,
despite the uncertainties related to inflationary pressures"
mentioned Mr. Jean Paschini,
Chairman of the Board of Directors and Chief Executive Officer.
"As mentioned when we disclosed our results for the quarter
ended April 30, 2022, we will begin
to see the favorable impacts of our recent investments towards
modernizing and automating equipment, in the second half of the
current fiscal year, which will allow us to maintain interesting
operating margins" concluded Mr. Paschini.
Dividend
On September 7, 2022, ADF Group
announced the payment of a semi-annual dividend of $0.01 per subordinate voting share and per
multiple voting shares, which will be paid on October 18, 2022, to shareholders of record as of
September 29, 2022.
Conference Call with
Investors
A conference call with investors is scheduled for this morning,
September 8, 2022, at 10 a.m. (Montreal time) to discuss the results of
Corporation's second quarter and first semester ended July 31, 2022.
To take part in the conference call, dial 1 (888) 390-0620, 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 Thursday, September 15, 2022, by dialing
1 (888) 259-6562, followed by the access code 101534#.
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-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:
- Net financial expenses;
- Income tax expense (recovery);
- Foreign exchange (gains) 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:
|
3 months
|
6 months
|
|
|
|
|
|
Periods Ended July
31,
|
2022
|
2021
|
2022
|
2021
|
|
(In thousands of
dollars)
|
$
|
$
|
$
|
$
|
|
Net income
|
5,426
|
1,498
|
9,682
|
5,893
|
|
Income tax expense
(recovery)
|
320
|
(136)
|
(46)
|
(35)
|
|
Net financial
expenses
|
439
|
304
|
637
|
597
|
|
Amortization
|
1,235
|
1,239
|
2,418
|
2,454
|
|
Foreign exchange (gain)
loss
|
(319)
|
169
|
12
|
277
|
|
Adjusted EBITDA
|
7,101
|
3,074
|
12,703
|
9,186
|
|
|
|
|
|
|
|
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.
Website: www.adfgroup.com
(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.