Logistec announces its results for the third quarter of 2017

MONTRÉAL, Nov. 7, 2017 /CNW Telbec/ - Logistec Corporation (TSX: LGT.A LGT.B), a marine and environmental services provider, today announced its financial results for the third quarter and first nine months ended September 30, 2017.

During the third quarter of 2017, consolidated revenue reached a record level for a third quarter, totalling $168.3 million, an increase of $65.2 million or 63.3% compared with the same period in 2016. The increase in revenue stems from both the marine and environmental services segments. Revenue from the marine services segment was up by $10.8 million or 25.3% to $53.7 million, while revenue from the environmental services segment totalled $114.6 million, up by $54.4 million or 90.3% compared with the third quarter of 2016. The increase in revenue in the marine services segment stems primarily from bulk activity, while break-bulk cargo volumes also increased, to a lesser degree. The high revenue increase in the environmental services segment is mainly due to our investment in FER-PAL Construction Ltd., as FER-PAL generated sales of $46.5 million in the third quarter. The increase is also attributable to higher levels of activity in Aqua-Pipe.

The third quarter of 2017 closed with a consolidated profit attributable to owners of the Company of $11.0 million, compared with a profit of $9.2 million for the third quarter of 2016. The profit attributable to owners of the Company translated into total diluted earnings per share of $0.83, of which $0.80 was attributable to Class A Common Shares and $0.88 was attributable to Class B Subordinate Voting Shares.

During the first nine months of 2017, consolidated revenue totalled $330.2 million, an increase of $82.7 million compared with $247.6 million for the same period in 2016. The profit attributable to owners of the Company amounted to $14.2 million, higher than last year's profit of $10.0 million. This translated into total diluted earnings per share of $1.10, of which $1.05 was attributable to
Class A Common Shares and $1.16 was attributable to Class B Subordinate Voting Shares. For the same period in 2016, total diluted earnings per share totalled $0.78, of which $0.73 was attributable to Class A Common Shares and $0.82 was attributable to Class B Subordinate Voting Shares.

Outlook

"The outlook for the year is promising. In our environmental business, our latest investment in FER-PAL is performing well and we have a solid book of business to end the working season. Furthermore, our growing cargo-handling business is strategically positioned to benefit from increasing trade flowing through our North American ports. More importantly, we are optimistic about the future of both our marine and environmental services segments. The solid performance of the third quarter and the diversity of our network and services bode well for continued development. We continue to seek geographic growth, both organically and through acquisitions, and are investing in our talent and technologies to grow our customer base in both 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 nine months ended
	September 30,  2017	September 24, 2016	September 30, 2017	September 24, 2016
	$	$	$	$
Revenue	168,314	103,093	330,246	247,568
Employee benefits expense	(83,326)	(45,860)	(163,558)	(115,987)
Equipment and supplies expense	(41,255)	(33,433)	(87,642)	(76,572)
Rental expense	(9,068)	(7,035)	(24,186)	(20,777)
Other expenses	(7,589)	(3,978)	(16,194)	(11,244)
Depreciation and amortization expense	(12,419)	(3,661)	(20,668)	(10,147)
Share of profit of equity accounted investments	4,137	2,473	5,371	2,764
Other gains and losses	(2,226)	488	(555)	(1,300)
Operating profit	16,568	12,087	22,814	14,305
Finance expense	(889)	(660)	(1,779)	(1,374)
Finance income	98	54	279	161
Profit before income taxes	15,777	11,481	21,314	13,092
Income taxes	(3,610)	(2,319)	(5,925)	(3,493)
Profit for the period	12,167	9,162	15,389	9,599
Profit attributable to:
Owners of the Company	10,955	9,153	14,214	9,966
Non-controlling interests	1,212	9	1,175	(367)
Profit for the period	12,167	9,162	15,389	9,599
Basic earnings per Class A Common Share ^(1)	0.84	0.72	1.12	0.78
Basic earnings per Class B Subordinate Voting Share ^(2)	0.93	0.80	1.23	0.87
Diluted earnings per Class A share	0.80	0.67	1.05	0.73
Diluted earnings per Class B share	0.88	0.75	1.16	0.82
Weighted average number of Class A shares outstanding, basic and diluted	7,410,122	7,414,789	7,411,100	7,422,089
Weighted average number of Class B shares outstanding, basic	5,062,472	4,763,900	4,845,939	4,784,856
Weighted average number of Class B shares outstanding, diluted	5,720,654	5,517,915	5,565,206	5,295,910

^(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 nine months ended
				September 30, 2017	September 24, 2016	September 30, 2017	September 24, 2016
				$	$	$	$
Profit for the period				12,167	9,162	15,389	9,599
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	(2,281)	461	(2,810)	(1,836)
			Gains on derivatives designated as cash flow hedges	87	(7)	87	2
			Transfer of losses on derivatives designated as cash flow hedges to the consolidated statements of earnings	–	18	–	49
			Income taxes relating to derivatives designated as cash flow hedges	(24)	(4)	(24)	(14)
	Total items that are or may be reclassified to the consolidated statements of earnings			(2,218)	468	(2,747)	(1,799)
	Items that will not be reclassified to the consolidated statements of earnings
			Remeasurement losses on benefit obligation	1,436	(1,014)	(1,075)	(3,028)
			Return on retirement plan assets excluding amounts included in profit for the period	535	820	676	867
			Income taxes on remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period	(530)	52	107	582
	Total items that will not be reclassified to the consolidated statements of earnings			1,441	(142)	(292)	(1,579)
	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	24	57	24	(49)
	Total share of other comprehensive income of equity accounted investments, net of income taxes			24	57	24	(49)
	Other comprehensive loss for the period, net of income taxes			(753)	383	(3,015)	(3,427)
	Total comprehensive income (loss) for the period			11,414	9,545	12,374	6,172
	Total comprehensive income (loss) attributable to:
Owners of the Company				10,202	9,536	11,199	6,539
Non-controlling interests				1,212	9	1,175	(367)
Total comprehensive income (loss) for the period				11,414	9,545	12,374	6,172

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
	Logistec Corporation
Condensed Consolidated Interim Statements of Financial Position
		As at September 30,  2017	As at December 31,  2016
		$	$
Assets
Current assets
	Cash and cash equivalents	6,317	15,971
	Short-term portion of an investment in a service contract	–	865
	Trade and other receivables	128,471	86,373
	Work in progress	19,894	4,395
	Current income tax assets	1,712	3,767
	Other financial assets	1,044	1,014
	Assets available for sale	–	330
	Prepaid expenses	3,494	5,654
	Inventories	9,878	7,506
		170,810	125,875
Equity accounted investments		32,933	31,141
Property, plant and equipment		159,968	138,591
Goodwill		107,961	24,899
Other intangible assets		26,179	18,233
Other non-current assets		2,062	1,534
Non-current financial assets		8,240	7,166
Post-employment benefit assets		672	706
Deferred income tax assets		8,816	7,715
Total assets		517,641	355,860
Liabilities
Current liabilities
	Short-term bank loans	8,748	–
	Trade and other payables	84,060	43,081
	Deferred revenue	2,239	2,928
	Current income tax liabilities	4,447	149
	Dividends payable	1,062	947
	Current portion of long-term debt	3,727	1,681
	Provisions	894	1,344
		105,177	50,130
Long-term debt		95,182	58,644
Provisions		771	800
Deferred income tax liabilities		15,907	13,382
Post-employment benefit obligations		13,795	13,076
Deferred revenue		3,833	4,133
Non-current financial liabilities		62,303	12,514
Total liabilities		296,968	152,679
Equity
Share capital		29,053	15,618
Share capital to be issued		19,820	24,898
Retained earnings		161,795	151,616
Accumulated other comprehensive income		6,528	9,251
Equity attributable to owners of the Company		217,196	201,383
Non-controlling interests		3,477	1,798
Total equity		220,673	203,181
Total liabilities and equity		517,641	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		–	–	–	–	14,214	14,214	1,175	15,389
Other comprehensive income (loss)
	Currency translation differences arising on translation of foreign operations	–	–	–	(2,810)	–	(2,810)	–	(2,810)
	Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	–	–	–	–	(292)	(292)	–	(292)
	Cash flow hedges, net of income taxes	–	–	87	–	–	87	–	87
Total comprehensive gain (loss) for the period		–	–	87	(2,810)	13,922	11,199	1,175	12,374
Repurchase of Class A shares		(2)	–	–	–	(91)	(93)	–	(93)
Issue and repurchase of Class B shares		8,359	–	–	–	(697)	7,662	–	7,662
Non-controlling interests arising from business acquisitions		–	–	–	–	–	–	50,593	50,593
Long-term liability for the obligation to repurchase the non-controlling interests		–	–	–	–	–	–	(50,089)	(50,089)
Issuance of Class B share capital to a subsidiary shareholder upon the exercise of put options		5,078	(5,078)	–	–	–	–	–	–
Dividends on Class A shares		–	–	–	–	(1,723)	(1,723)	–	(1,723)
Dividends on Class B shares		–	–	–	–	(1,232)	(1,232)	–	(1,232)
Balance as at September 30, 2017		29,053	19,820	83	6,445	161,795	217,196	3,477	220,673
Balance as at January 1, 2016		14,985	–	(139)	10,413	164,154	189,413	20,232	209,645
Profit (loss) for the period		–	–	–	–	9,966	9,966	(367)	9,599
Other comprehensive income (loss)
	Currency translation differences arising on translation of foreign operations	–	–	–	(1,836)	─	(1,836)	–	(1,836)
	Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	–	–	–	–	(1,579)	(1,579)	–	(1,579)
	Cash flow hedges, net of income taxes	–	–	37	–	–	37	–	37
	Share of other comprehensive income of equity accounted investments, net of income taxes	–	–	(49)	–	–	(49)	–	(49)
Total comprehensive income (loss) for the period		–	–	(12)	(1,836)	8,387	6,539	(367)	6,172
Repurchase of Class A shares		(15)	–	–	–	(907)	(922)	–	(922)
Issuance and repurchase of Class B shares		697	–	–	–	(8,308)	(7,611)	–	(7,611)
Repurchase of non-controlling interests		–	24,898	–	–	(18,148)	6,750	(18,062)	(11,312)
Dividends on Class A shares		–	–	–	–	(1,671)	(1,671)	–	(1,671)
Dividends on Class B shares		–	–	–	–	(1,175)	(1,175)	–	(1,175)
Balance as at September 24, 2016		15,667	24,898	(151)	8,577	142,332	191,323	1,803	193,126

(in thousands of Canadian dollars) (unaudited and not reviewed by the independent auditor)
	Logistec Corporation
Condensed Consolidated Interim Statements of Cash Flows
		For the nine months ended
		September 30, 2017	September 24, 2016
		$	$
Operating activities
	Profit for the period	15,389	9,599
	Items not affecting cash and cash equivalents	25,547	22,251
	Cash generated from operations	40,936	31,850
	Dividends received from equity accounted investments	3,600	2,143
	Contributions to defined benefit retirement plans	(850)	(713)
	Settlement of provisions	(92)	(134)
	Changes in non-cash working capital items	(14,565)	(33,908)
	Income taxes paid	(1,702)	(5,900)
		27,327	(6,662)
Financing activities
	Net change in short-term bank loans	498	–
	Issuance of long-term debt	88,251	51,164
	Repayment of long-term debt	(53,508)	(18,848)
	Interest paid	(1,745)	(1,426)
	Repurchase of Class A shares	(93)	(922)
	Issuance of Class B shares	201	607
	Repurchase of Class B shares	(751)	(8,781)
	Dividends paid on Class A shares	(1,667)	(1,671)
	Dividends paid on Class B shares	(1,173)	(1,194)
		30,013	18,929
Investing activities
	Customer repayment of an investment in a service contract	865	216
	Interest received	297	161
	Repurchase of a non-controlling interest	–	(2,393)
	Business acquisitions	(48,037)	(4,562)
	Cash acquired in business acquisitions	–	197
	Acquisition of property, plant and equipment	(21,230)	(18,561)
	Proceeds from disposal of property, plant and equipment	2,511	119
	Cash paid to a minority interest	(2,214)	–
	Acquisition of other non-current financial assets	–	(27)
	Repayment of other non-current financial assets	142	–
	Acquisition of intangible assets	(39)	(30)
	Acquisition of other non-current assets	(692)	(761)
	Repayment of other non-current assets	72	28
		(68,325)	(25,613)
Net change in cash and cash equivalents		(10,985)	(13,346)
Cash and cash equivalents, beginning of period		15,971	23,811
Effect of exchange rate on balances held in foreign currencies of foreign operations		1,331	441
Cash and cash equivalents, end of period		6,317	10,906
Additional information
Acquisition of property, plant and equipment included in trade and other payables		1,914	3,153

SOURCE Logistec Corporation

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

Related Links

http://www.logistec.com/