LOGISTEC announces its results for the second quarter of 2018

MONTRÉAL, Aug. 9, 2018 /CNW Telbec/ - LOGISTEC Corporation (TSX: LGT.A) (TSX: LGT.B), a marine and environmental services provider, today announced its financial results for the second quarter and first six months ended June 30, 2018.

In the second quarter of 2018, consolidated revenue totalled $149.2 million, an increase of $47.3 million or 46.5% over the same period in 2017. Revenue from the marine services segment rose by 62.0%, from $52.9 million to $85.7 million, while revenue from the environmental services segment amounted to $63.5 million, an increase of $14.5 million or 29.7% over the second quarter of 2017. Cargo handling activities were very strong in the second quarter, and we also benefited from our first full quarter with Gulf Stream Marine, Inc., the new Gulf terminals we purchased in early March. Our teams have integrated well and we are confident that we will achieve positive synergies going forward. We are pleased with our marine services results.

The second quarter of 2018 closed with a consolidated profit attributable to owners of the Company of $1.9 million, compared with a profit of $4.8 million for the second quarter of 2017. The profit attributable to owners of the Company translated to a total diluted profit per share of $0.14, of which $0.14 was attributable to Class A Common Shares and $0.15 was attributable to Class B Subordinate Voting Shares. The lower results can largely be attributed to our acquisition of FER-PAL Construction Ltd., which, like Sanexen, is very affected by the seasonality of operations. For the second quarter, this was further exacerbated by a late start to the rehabilitation season in our largest market due to weather and delayed contract awards. That being said, operations are now in full swing and will remain as such until November.

During the first six months of 2018, consolidated revenue increased to $231.6 million, compared with $161.9 million for the first half of 2017. The loss attributable to owners of the Company amounted to $7.6 million, compared with a profit of $3.3 million for the same period last year. This translated into a total basic and diluted loss per share of $0.60, of which $0.58 was attributable to Class A Common Shares and $0.64 was attributable to Class B Subordinate Voting Shares. For the same period in 2017, diluted earnings per share totalled $0.25, of which $0.24 was attributable to Class A Common Shares and $0.27 was attributable to Class B Subordinate Voting Shares.

Outlook

"The outlook remains positive. Both our marine and environmental services segments are expected to have a strong finish, each benefiting from acquisitions made over the last year. We continue to invest in our talent to pursue our growth strategy while integrating recent acquisitions", 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 37 ports and 61 terminals across 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 services segment where it provides services to industrial, municipal and other governmental customers for the trenchless structural rehabilitation of underground watermains, 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.

Q2 2018 CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(in thousands of Canadian dollars, except for per share amounts and number of shares)
(unaudited and not reviewed by the independent auditor)  

Condensed Consolidated Interim Statements of Earnings
	For the three months ended		For the six months ended
	June 30, 2018	June 24, 2017	June 30, 2018	June 24, 2017
	$	$	$	$
Revenue	149,182	101,861	231,624	161,932
Employee benefits expense	(77,284)	(48,426)	(123,650)	(80,232)
Equipment and supplies expense	(39,292)	(29,113)	(63,630)	(46,387)
Rental expense	(11,777)	(8,185)	(20,838)	(15,118)
Other expenses	(7,812)	(4,969)	(13,958)	(8,605)
Depreciation and amortization expense	(6,485)	(4,223)	(12,568)	(8,249)
Share of profit of equity accounted investments	962	827	1,032	1,234
Other gains and losses	941	(59)	1,156	1,671
Operating profit (loss)	8,435	7,713	(832)	6,246
Finance expense	(2,760)	(495)	(3,647)	(890)
Finance income	15	98	98	181
Profit (loss) before income taxes	5,690	7,316	(4,381)	5,537
Income taxes	(2,630)	(2,535)	(885)	(2,315)
Profit (loss) for the period	3,060	4,781	(5,266)	3,222
Profit (loss) attributable to:
Owners of the Company	1,868	4,789	(7,609)	3,259
Non-controlling interests	1,192	(8)	2,343	(37)
Profit (loss) for the period	3,060	4,781	(5,266)	3,222
Basic earnings (loss) per Class A Common Share ^(1)	0.14	0.38	(0.58)	0.26
Basic earnings (loss) per Class B Subordinate Voting Share ^(2)	0.16	0.41	(0.64)	0.28
Diluted earnings (loss) per Class A share	0.14	0.36	(0.58)	0.24
Diluted earnings (loss) per Class B share	0.15	0.39	(0.64)	0.27
Weighted average number of Class A shares outstanding, basic and diluted	7,405,455	7,410,922	7,405,689	7,411,589
Weighted average number of Class B shares outstanding, basic	5,271,167	4,735,742	5,217,249	4,737,673
Weighted average number of Class B shares outstanding, diluted	5,726,904	5,483,448	5,724,496	5,487,482

⁽¹⁾  Class A Common Share ("Class A share")

⁽²⁾  Class B Subordinate Voting Share ("Class B share")

Condensed Consolidated Interim Statements of Comprehensive Income
			For the three months ended		For the six months ended
			June 30, 2018	June 24, 2017	June 30, 2018	June 24, 2017
			$	$	$	$
Profit (loss) for the period			3,060	4,781	(5,266)	3,222
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	3,004	(365)	4,981	(529)
		Gain on derivatives	—	—	4	—
		Income tax related	—	—	(1)	—
	Total items that are or may be reclassified to the consolidated statements of earnings		3,004	(365)	4,984	(529)
	Items that will not be reclassified to the consolidated statements of earnings
		Remeasurement gain (loss) on benefit obligation	1,171	(2,511)	1,171	(2,511)
		Return on retirement plan assets excluding amounts included in profit (loss) for the period	153	(232)	(33)	141
		Income taxes on remeasurement gain (loss) on benefit obligation and return on retirement plan assets excluding amounts included in profit (loss) for the period	(354)	737	(305)	637
	Total items that will not be reclassified to the consolidated statements of earnings		970	(2,006)	833	(1,733)
	Other comprehensive income for the period, net of income taxes		3,974	(2,371)	5,817	(2,262)
	Total comprehensive income for the period		7,034	2,410	551	960
Total comprehensive income attributable to:
Owners of the Company			5,832	2,418	(1,814)	997
Non-controlling interests			1,202	(8)	2,365	(37)
Total comprehensive income for the period			7,034	2,410	551	960

Condensed Consolidated Interim Statements of Financial Position
		As at June 30,  2018	As at December 31,  2017
		$	$
Assets
Current assets
	Cash and cash equivalents	8,977	3,963
	Trade and other receivables	142,329	153,342
	Work in progress	15,146	5,306
	Current income tax assets	4,962	494
	Other financial assets	206	1,055
	Prepaid expenses	5,300	2,775
	Inventories	13,619	11,550
		190,539	178,485
Equity accounted investments		32,038	34,350
Property, plant and equipment		181,712	160,717
Goodwill		161,881	105,618
Other intangible assets		42,637	14,903
Other non-current assets		1,915	1,658
Post-employment benefit assets		—	606
Non-current financial assets		12,406	7,984
Deferred income tax assets		8,930	9,218
Total assets		632,058	513,539
Liabilities
Current liabilities
	Short-term bank loans	13,818	9,829
	Trade and other payables	87,880	85,174
	Deferred revenue	4,207	2,252
	Current income tax liabilities	1,405	3,699
	Dividends payable	1,089	1,075
	Current portion of long-term debt	6,490	5,447
	Provisions	1,163	813
		116,052	108,289
Long-term debt		182,732	77,957
Provisions		784	771
Deferred income tax liabilities		26,009	15,575
Post-employment benefit obligations		13,345	14,778
Deferred revenue		3,533	3,733
Non-current financial liabilities		60,535	61,641
Total liabilities		402,990	282,744
Equity
Share capital		35,149	29,019
Share capital to be issued		14,717	19,820
Retained earnings		163,048	173,129
Accumulated other comprehensive income		11,568	6,606
Equity attributable to owners of the Company		224,482	228,574
Non-controlling interest		4,586	2,221
Total equity		229,068	230,795
Total liabilities and equity		632,058	513,539

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, 2018		29,019	19,820	138	6,468	173,129	228,574	2,221	230,795
Profit (loss) for the period		—	—	—	—	(7,609)	(7,609)	2,343	(5,266)
Other comprehensive income
	Currency translation differences arising on translation of foreign operations	—	—	—	4,959	—	4,959	22	4,981
	Remeasurement gain (loss) on benefit obligation and return on retirement plan assets excluding amounts included in profit (loss) for the period, net of income taxes	—	—	—	—	833	833	—	833
	Cash flow hedges, net of income taxes	—	—	3	—	—	3	—	3
Total comprehensive income for the period		—	—	3	4,959	(6,776)	(1,814)	2,365	551
Remeasurement of written put option liability		—	—	—	—	(900)	(900)	—	(900)
Repurchase of Class A shares		—	—	—	—	(32)	(32)	—	(32)
Issue and Repurchase of Class B shares		(24)	—	—	—	(196)	(220)	—	(220)
Issuance, repurchase of share capital		6,154	(5,103)	—	—	—	1,051	—	1,051
Dividends on Class A shares		—	—	—	—	(1,220)	(1,220)	—	(1,220)
Dividends on Class B shares		—	—	—	—	(957)	(957)	—	(957)
Balance as at June 30, 2018		35,149	14,717	141	11,427	163,048	224,482	4,586	229,068
Balance as at January 1, 2017		15,618	24,898	(4)	9,255	151,616	201,383	1,798	203,181
Profit (loss) 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 income 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

Condensed Consolidated Interim Statements of Cash Flows
		For the six months ended
		June 30, 2018	June 24, 2017
		$	$
Operating activities
	Profit (loss) for the period	(5,266)	3,222
	Items not affecting cash and cash equivalents	20,334	10,486
	Cash generated from operations	15,068	13,708
	Dividends received from equity accounted investments	3,346	3,600
	Contributions to defined benefit retirement plans	(595)	(557)
	Settlement of provisions	(165)	(148)
	Changes in non-cash working capital items	5,808	12,517
	Income taxes paid	(7,998)	(2,277)
		15,464	26,843
Financing activities
	Net change in short-term bank loans	3,989	—
	Issuance of long-term debt	117,226	13,614
	Repayment of long-term debt	(16,425)	(25,966)
	Interest paid	(1,844)	(955)
	Issuance of Class B shares	562	—
	Repurchase of Class A shares	(32)	(81)
	Repurchase of Class B shares	(220)	(644)
	Dividends paid on Class A shares	(1,222)	(1,112)
	Dividends paid on Class B shares	(942)	(782)
		101,092	(15,926)
Investing activities
	Customer repayment of an investment in a service contract	—	865
	Interest received	108	190
	Repurchase of a non-controlling interest	—	(1,332)
	Business acquisitions	(97,998)	(5,805)
	Cash acquired in a business acquisition	2,585	—
	Note receivable	(5,067)	—
	Cash paid to minority interest	(157)	—
	Acquisition of property, plant and equipment	(10,144)	(14,668)
	Proceeds from disposal of property, plant and equipment	290	2,225
	Repayment of other non-current financial assets	101	94
	Acquisition of intangible assets	(93)	(6)
	Acquisition of other non-current assets	(285)	(191)
	Repayment of other non-current assets	150	67
		(110,510)	(18,561)
Net change in cash and cash equivalents		6,046	(7,644)
Cash and cash equivalents, beginning of period		3,963	15,971
Effect of exchange rate on balances held in foreign currencies of foreign operations		(1,032)	(38)
Cash and cash equivalents, end of period		8,977	8,289
Additional information
Acquisition of property, plant and equipment included in trade and other payables		253	1,553

SOURCE Logistec Corporation

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

Related Links

http://www.logistec.com/