Logistec announces its results for the second quarter of 2017

MONTRÉAL, July 28, 2017 /CNW Telbec/ - Logistec Corporation (TSX: LGT.A LGT.B), a marine and environmental services provider, today announced its financial results for the second quarter and first six months ended June 24, 2017.

During the second quarter of 2017, consolidated revenue reached a record level for a second quarter, totalling $101.9 million, an increase of $22.2 million or 27.9% compared with the same period in 2016. The increase in revenue came from both our marine and environmental services segments and more particularly from increases in our bulk-handling business from three new terminals, which were added to the network since the beginning of the year. Revenue from the marine services segment was up by $7.7 million or 14.5% to $53.0 million, while revenue from the environmental services segment amounted to $48.9 million, up by $14.5 million or 42.2% compared with the second quarter of 2016. The increase in revenue in the marine services segment stems primarily from bulk activity, while break-bulk cargo volumes were stable. The high revenue increase in the environmental services segment is due to higher levels of activity in both Aqua-Pipe and site remediation, partially offset by decreased activity in Europe, where we closed our asbestos removal activities. The second quarter of 2017 closed with a consolidated profit attributable to owners of the Company of $4.8 million, compared with a profit of $1.0 million for the second quarter of 2016. The profit attributable to owners of the Company translated into total diluted earnings per share of $0.37, of which $0.36 was attributable to Class A Common Shares and $0.39 was attributable to Class B Subordinate Voting Shares.

During the first six months of 2017, consolidated revenue increased to $161.9 million, compared with $144.5 million for the first half of 2016. The profit attributable to owners of the Company amounted to $3.3 million, which is substantially more than last year's profit of $0.8 million. This translated into total diluted earnings per share of $0.25, of which $0.24 was attributable to Class A Common Shares and $0.27 was attributable to Class B Subordinate Voting Shares. For the same period in 2016, diluted earnings per share totalled $0.06, of which $0.06 was attributable to Class A Common Shares and $0.07 was attributable to Class B Subordinate Voting Shares.

Outlook

"We view our outlook with optimism. We are very pleased with our results for the marine services segment. In particular, our bulk business has shown considerable improvement, especially with the addition of our two new bulk projects. Our container business has also shown double-digit growth and, with the completion of our new Viau container terminal, we are showing improved efficiencies. Results have been disappointing in our environmental services segment, and this can be linked to seasonality, lower-than-expected results for Aqua-Pipe services in the USA, but more particularly, extremely poor results in France. Despite the slow start, our backlog allows us to believe that the next six months will reach record levels. Furthermore, with the acquisition of 51% of FER-PAL Construction Ltd., we are optimistic about a strong finish to the year in both our marine and environmental services segments," indicated Madeleine Paquin, President and Chief Executive Officer of Logistec Corporation.

About Logistec

Logistec Corporation is based in Montréal (QC) and provides specialized services to the marine community and industrial companies in the areas of bulk, break-bulk and container cargo handling in some 30 ports and 40 terminals located in eastern North America. Logistec also offers marine transportation services geared primarily to the Arctic coastal trade, short-line rail transportation services, as well as marine agency services to foreign shipowners and operators serving the Canadian market. Furthermore, the Company operates in the environmental sector where it provides services to industrial, municipal and other governmental customers for the trenchless structural rehabilitation of underground water mains, regulated materials management, site remediation, risk assessment, and manufacturing of woven hoses.

The Company has been profitable and has paid regular dividends since becoming public and payments have grown steadily over the years. A public company since 1969, Logistec's shares are listed on the Toronto Stock Exchange under the ticker symbols LGT.A and LGT.B. More information can be obtained on the Company's website at www.logistec.com.

Forward-Looking Statements

For the purpose of informing shareholders and potential investors about the Company's prospects, sections of this document may contain forward-looking statements, within the meaning of securities legislation, about the Company's activities, performance and financial situation and, in particular, hopes for the success of the Company's efforts in the development and growth of its business. These forward-looking statements express, as of the date of this document, the estimates, predictions, projections, expectations or opinions of the Company about future events or results. Although the Company believes that the expectations produced by these forward-looking statements are founded on valid and reasonable bases and assumptions, these forward-looking statements are inherently subject to important uncertainties and contingencies, many of which are beyond the Company's control, such that the Company's performance may differ significantly from the predicted performance expressed or presented in such forward-looking statements. The important risks and uncertainties that may cause the actual results and future events to differ significantly from the expectations currently expressed are examined under "Business Risks" in the Company's annual report and include (but are not limited to) the performances of domestic and international economies and their effect on shipping volumes, weather conditions, labour relations, pricing and competitors' marketing activities. The reader of this document is thus cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to update or revise these forward-looking statements, except as required by law.

Additional information relating to our Company can be found on SEDAR's website at www.sedar.com and on Logistec's website at www.logistec.com.

(in thousands of Canadian dollars, except for per share amounts and number of shares) (unaudited and not reviewed by the independent auditor)
Logistec Corporation
Condensed Consolidated Interim Statements of Earnings
	For the three months ended		For the six months ended
	June 24, 2017	June 25, 2016	June 24, 2017	June 25, 2016
	$	$	$	$
Revenue	101,861	79,616	161,932	144,475
Employee benefits expense	(48,426)	(38,126)	(80,232)	(70,127)
Equipment and supplies expense	(29,113)	(24,762)	(46,387)	(43,139)
Rental expense	(8,185)	(6,923)	(15,118)	(13,742)
Other expenses	(4,969)	(3,081)	(8,605)	(7,266)
Depreciation and amortization expense	(4,223)	(3,450)	(8,249)	(6,486)
Share of profit of equity accounted investments	827	101	1,234	291
Other gains and losses	(59)	(730)	1,671	(1,788)
Operating profit	7,713	2,645	6,246	2,218
Finance expense	(495)	(409)	(890)	(714)
Finance income	98	45	181	107
Profit before income taxes	7,316	2,281	5,537	1,611
Income taxes	(2,535)	(1,343)	(2,315)	(1,174)
Profit for the period	4,781	938	3,222	437
Profit attributable to:
Owners of the Company	4,789	951	3,259	813
Non-controlling interests	(8)	(13)	(37)	(376)
Profit for the period	4,781	938	3,222	437
Basic earnings per Class A Common Share ^(1)	0.38	0.08	0.26	0.06
Basic earnings per Class B Subordinate Voting Share ^(2)	0.41	0.08	0.28	0.07
Diluted earnings per Class A share	0.36	0.07	0.24	0.06
Diluted earnings per Class B share	0.39	0.08	0.27	0.07
Weighted average number of Class A shares outstanding, basic and diluted	7,410,922	7,421,155	7,411,589	7,425,739
Weighted average number of Class B shares outstanding, basic	4,735,742	4,756,467	4,737,673	4,795,333
Weighted average number of Class B shares outstanding, diluted	5,483,448	5,510,482	5,487,482	5,184,908

^(1)	Class A Common Share ("Class A share")
^(2)	Class B Subordinate Voting Share ("Class B share")

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
Logistec Corporation
Condensed Consolidated Interim Statements of Comprehensive Income
			For the three months ended			For the six months ended
			June 24, 2017	June 25, 2016		June 24, 2017	June 25, 2016
			$	$		$	$
Profit for the period			4,781	938		3,222	437
Other comprehensive income
	Items that are or may be reclassified to the consolidated statements of earnings
		Currency translation differences arising on translation of foreign operations	(365)	(662)		(529)	(2,297)
		Gains on derivatives designated as cash flow hedges	–	9		–	9
		Transfer of losses on derivatives designated as cash flow hedges to the consolidated statements of earnings	–	17		–	31
		Income taxes relating to derivatives designated as cash flow hedges	–	(6)		–	(10)
	Total items that are or may be reclassified to the consolidated statements of earnings		(365)	(642)		(529)	(2,267)
	Items that will not be reclassified to the consolidated statements of earnings
		Remeasurement losses on benefit obligation	(2,511)	(2,014)		(2,511)	(2,014)
		Return on retirement plan assets excluding amounts included in profit for the period	(232)	262		141	47
		Income taxes on remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period	737	472		637	530
	Total items that will not be reclassified to the consolidated statements of earnings		(2,006)	(1,280)		(1,733)	(1,437)
	Share of other comprehensive income of equity accounted investments, net of income taxes
		Items that are or may be reclassified to the consolidated statements of earnings	–	(14)		–	(106)
	Total share of other comprehensive income of equity accounted investments, net of income taxes		–	(14)		–	(106)
	Other comprehensive loss for the period, net of income taxes		(2,371)	(1,936)		(2,262)	(3,810)
	Total comprehensive income (loss) for the period		2,410	(998)		960	(3,373)
	Total comprehensive income (loss) attributable to:
Owners of the Company			2,418	(985)		997	(2,997)
Non-controlling interests			(8)	(13)		(37)	(376)
Total comprehensive income (loss) for the period			2,410	(998)		960	(3,373)

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
Logistec Corporation
Condensed Consolidated Interim Statements of Financial Position
		As at June 24,  2017	As at December 31,  2016
		$	$
Assets
Current assets
	Cash and cash equivalents	8,289	15,971
	Short-term portion of an investment in a service contract	–	865
	Trade and other receivables	73,171	86,373
	Work in progress	14,577	4,395
	Current income tax assets	4,122	3,767
	Other financial assets	1,051	1,014
	Assets available for sale	–	330
	Prepaid expenses	4,754	5,654
	Inventories	8,045	7,506
		114,009	125,875
Equity accounted investments		28,769	31,141
Property, plant and equipment		152,688	138,591
Goodwill		26,224	24,899
Other intangible assets		17,330	18,233
Other non-current assets		1,511	1,534
Non-current financial assets		6,064	7,166
Post-employment benefit assets		537	706
Deferred income tax assets		9,050	7,715
Total assets		356,182	355,860
Liabilities
Current liabilities
	Trade and other payables	52,627	43,081
	Deferred revenue	2,767	2,928
	Current income tax liabilities	950	149
	Dividends payable	947	947
	Current portion of long-term debt	2,264	1,681
	Provisions	902	1,344
		60,457	50,130
Long-term debt		45,544	58,644
Provisions		765	800
Deferred income tax liabilities		13,308	13,382
Post-employment benefit obligations		15,529	13,076
Deferred revenue		3,933	4,133
Non-current financial liabilities		15,124	12,514
Total liabilities		154,660	152,679
Equity
Share capital		15,783	15,618
Share capital to be issued		24,689	24,898
Retained earnings		150,567	151,616
Accumulated other comprehensive income		8,722	9,251
Equity attributable to owners of the Company		199,761	201,383
Non-controlling interests		1,761	1,798
Total equity		201,522	203,181
Total liabilities and equity		356,182	355,860

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
Logistec Corporation
Condensed Consolidated Interim Statements of Changes in Equity
		Attributable to owners of the Company
					Accumulated other comprehensive income
		Share capital	Share capital to be issued		Cash flow hedges	Foreign currency translation	Retained earnings	Total	Non- controlling interests			Total equity
		$	$		$	$	$	$	$			$
Balance as at January 1, 2017		15,618	24,898		(4)	9,255	151,616	201,383	1,798			203,181
Profit for the period		–	–		–	–	3,259	3,259	(37)			3,222
Other comprehensive income (loss)
	Currency translation differences arising on translation of foreign operations	–	–		–	(529)	–	(529)	–			(529)
	Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	–	–		–	–	(1,733)	(1,733)	–			(1,733)
Total comprehensive loss for the period		–	–		–	(529)	1,526	997	(37)			960
Repurchase of Class A shares		(1)	–		–	–	(80)	(81)	–			(81)
Issue and repurchase of Class B shares		(43)	–		–	–	(601)	(644)	–			(644)
Non-controlling interest arising from a business acquisition		–	–		–	–	–	–	2,545			2,545
Long-term liability for the obligation to repurchase the non-controlling interest		–	–		–	–	–	–	(2,545)			(2,545)
Issuance of Class B share capital to a subsidiary shareholder upon the exercise of put options		209	(209)		–	–	–	–	–			–
Dividends on Class A shares		–	–		–	–	(1,112)	(1,112)	–			(1,112)
Dividends on Class B shares		–	–		–	–	(782)	(782)	–			(782)
Balance as at June 24, 2017		15,783	24,689		(4)	8,726	150,567	199,761	1,761			201,522
Balance as at January 1, 2016		14,985	–		(139)	10,413	164,154	189,413	20,232			209,645
Profit for the period		–	–		–	–	813	813	(376)			437
Other comprehensive income (loss)
	Currency translation differences arising on translation of foreign operations	–	–		–	(2,297)	–	(2,297)	–			(2,297)
	Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	–	–		–	–	(1,437)	(1,437)	–			(1,437)
	Cash flow hedges, net of income taxes	–	–		30	–	–	30	–			30
	Share of other comprehensive income of equity accounted investments, net of income taxes	–	–		(106)	–	–	(106)	–			(106)
Total comprehensive loss for the period		–	–		(76)	(2,297)	(624)	(2,997)	(376)			(3,373)
Repurchase of Class A shares		(12)	–		–	–	(715)	(727)	–			(727)
Repurchase of Class B shares		(460)	–		–	–	(8,075)	(8,535)	–			(8,535)
Repurchase of non-controlling interests		–	24,898		–	–	(18,148)	6,750	(18,062)			(11,312)
Dividends on Class A shares		–	–		–	–	(1,113)	(1,113)	–			(1,113)
Dividends on Class B shares		–	–		–	–	(785)	(785)	–			(785)
Balance as at June 25, 2016		14,513	24,898		(215)	8,116	134,694	182,006	1,794			183,800

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
Logistec Corporation
Condensed Consolidated Interim Statements of Cash Flows
		For the six months ended
		June 24, 2017	June 25, 2016
		$	$
Operating activities
	Profit for the period	3,222	437
	Items not affecting cash and cash equivalents	10,486	13,084
	Cash generated from operations	13,708	13,521
	Dividends received from equity accounted investments	3,600	1,000
	Contributions to defined benefit retirement plans	(557)	(479)
	Settlement of provisions	(148)	(107)
	Changes in non-cash working capital items	12,517	(13,354)
	Income taxes paid	(2,277)	(5,998)
		26,843	(5,417)
Financing activities
	Net change in short-term bank loans	–	7,607
	Issuance of long-term debt	13,614	20,269
	Repayment of long-term debt	(25,966)	(4,641)
	Interest paid	(956)	(707)
	Repurchase of Class A shares	(81)	(727)
	Repurchase of Class B shares	(643)	(8,535)
	Dividends paid on Class A shares	(1,112)	(1,114)
	Dividends paid on Class B shares	(782)	(802)
		(15,926)	11,350
Investing activities
	Customer repayment of an investment in a service contract	865	142
	Interest received	190	94
	Repurchase of a non-controlling interest	(1,332)	(2,393)
	Business acquisition	(5,805)	(4,562)
	Cash acquired in a business acquisition	–	197
	Acquisition of property, plant and equipment	(14,668)	(16,056)
	Proceeds from disposal of property, plant and equipment	2,225	106
	Acquisition of other non-current financial assets	–	(27)
	Repayment of other non-current financial assets	94	–
	Acquisition of intangible assets	(6)	(29)
	Acquisition of other non-current assets	(191)	(29)
	Repayment of other non-current assets	67	3
		(18,561)	(22,554)
Net change in cash and cash equivalents		(7,644)	(16,621)
Cash and cash equivalents, beginning of period		15,971	23,811
Effect of exchange rate on balances held in foreign currencies of foreign operations		(38)	619
Cash and cash equivalents, end of period		8,289	7,809
Additional information
Acquisition of property, plant and equipment included in trade and other payables		1,553	1,162

SOURCE Logistec Corporation

Jean-Claude Dugas, CPA, CA, Vice-President, Finance, Logistec Corporation, [email protected], [phone]

Related Links

http://www.logistec.com/