Logistec announces record results for the first nine months of 2014

MONTREAL, Nov. 11, 2014 /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 27, 2014.

During the third quarter of 2014, Logistec kept up its consolidated revenue and profit momentum. Revenue totalled $93.9 million, an increase of $5.2 million or 5.8% over the same period of 2013. The marine services segment's revenue grew by $0.8 million or 1.8% to $48.7 million for the third quarter of 2014, whereas the environmental services segment's revenue amounted to $45.2 million, up by $4.3 million over the third quarter of 2013. The growth in the environmental services segment was driven primarily by an overall increase in Sanexen's Aqua-Pipe business. The third quarter of 2014 closed with a consolidated profit attributable to owners of the Company of $12.0 million, up slightly by $0.4 million over the same period of 2013. For the third quarter of 2014, the profit attributable to owners of the Company translated into total basic and diluted earnings per share of $0.95, of which $0.91 was attributable to Class A Common Shares and $1.00 was attributable to Class B Subordinate Voting Shares.

During the first nine months of 2014, consolidated revenue and profit rose to a record high. Consolidated revenue totalled $235.3 million, compared with $218.8 million for the first nine months of 2013. The profit attributable to owners of the Company amounted to $23.8 million for total basic and diluted earnings per share of $1.88, of which $1.81 was attributable to Class A Common Shares and $1.98 was attributable to Class B Subordinate Voting Shares. This compares favourably to the total basic and diluted earnings per share of $1.62 for the same period in 2013, of which $1.55 was attributable to Class A Common Shares and $1.71 was attributable to Class B Subordinate Voting Shares.

Outlook
"We are very pleased to have achieved Logistec's best-ever performance for a nine-month period. The balance of the year will no doubt be a little quieter, as is usual for the Company, but we remain optimistic as our services, both marine and environmental, continue to perform based on their individual development plans. In 2014, we undertook one of our Company's most ambitious capital expenditure programs ever. Combined with our business acquisitions over the past two years, we will have significantly increased our capacity and efficiency," 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 29 ports 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 woven-hose manufacturing.

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.

Condensed Consolidated Interim Statements of Earnings (in thousands of Canadian dollars, except for per share amounts and number of shares) (unaudited)
	For the three months ended		For the nine months ended
	September 27, 2014	September 28, 2013	September 27, 2014	September 28, 2013
	$	$	$	$
Revenue	93,908	88,724	235,340	218,822
Employee benefits expense	(44,782)	(39,632)	(110,445)	(98,780)
Equipment and supplies expense	(23,130)	(23,503)	(60,607)	(57,962)
Rental expense	(6,958)	(6,328)	(19,895)	(20,144)
Other expenses	(2,301)	(2,851)	(8,627)	(8,872)
Depreciation and amortization expense	(2,591)	(2,406)	(7,512)	(7,003)
Share of profit of equity accounted investments	2,907	3,308	4,050	3,655
Other gains and losses	612	(276)	2,065	849
Operating profit	17,665	17,036	34,369	30,565
Finance expense	(229)	(88)	(451)	(456)
Finance income	92	105	301	313
Profit before income taxes	17,528	17,053	34,219	30,422
Income taxes	(3,993)	(3,955)	(8,147)	(7,494)
Profit for the period	13,535	13,098	26,072	22,928
Profit attributable to:
Owners of the Company	11,959	11,569	23,750	20,890
Non-controlling interests	1,576	1,529	2,322	2,038
Profit for the period	13,535	13,098	26,072	22,928
Basic and diluted earnings per Class A Common Share ^(1) (2)	0.91	0.86	1.81	1.55
Basic and diluted earnings per Class B Subordinate Voting Share ^(2) (3)	1.00	0.95	1.98	1.71
Weighted average number of Class A shares outstanding, basic and diluted ^(2)	7,462,922	7,495,422	7,465,944	7,500,934
Weighted average number of Class B shares outstanding, basic and diluted ^(2)	5,111,433	5,408,700	5,176,100	5,418,988

^(1)	Class A Common Share ("Class A share")
^(2)	All share-based information has been adjusted to reflect the impact of the two-for-one stock split as if it occurred January 1, 2013.
^(3)	Class B Subordinate Voting Share ("Class B share")

Condensed Consolidated Interim Statements of Comprehensive Income (in thousands of Canadian dollars) (unaudited)
			For the three months ended		For the nine months ended
			September 27, 2014	September 28, 2013	September 27, 2014	September 28, 2013
			$	$	$	$
Profit for the period			13,535	13,098	26,072	22,928
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	1,484	(581)	1,519	917
		Losses on derivatives designated as cash flow hedges	─	(14)	(1)	(4)
		Transfer of losses on derivatives designated as cash flow hedges to the consolidated statements of earnings	1	3	3	11
		Income taxes relating to derivatives designated as cash flow hedges	─	3	─	(2)
		Share of other comprehensive income of equity accounted investments, net of income taxes	4	(26)	45	(26)
	Total items that are or may be reclassified to the consolidated statements of earnings		1,489	(615)	1,566	896
	Items that will not be reclassified to the consolidated statements of earnings
		Remeasurement gains (losses) on benefit obligation	─	-	(1,588)	2,196
		Return on retirement plan assets excluding amounts included in profit for the period	(54)	893	735	2,316
		Income taxes on remeasurement gains (losses) on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period	14	(239)	229	(1,213)
	Total items that will not be reclassified to the consolidated statements of earnings		(40)	654	(624)	3,299
Other comprehensive income for the period, net of income taxes			1,449	39	942	4,195
Total comprehensive income for the period			14,984	13,137	27,014	27,123
Total comprehensive income attributable to:
Owners of the Company			13,408	11,608	24,692	25,085
Non-controlling interests			1,576	1,529	2,322	2,038
Total comprehensive income for the period			14,984	13,137	27,014	27,123

Condensed Consolidated Interim Statements of Financial Position in thousands of Canadian dollars) (unaudited)
		As at September 27, 2014	As at December 31, 2013
		$	$
Assets
Current assets
	Cash and cash equivalents	19,799	19,638
	Investments in service contracts	1,425	1,597
	Trade and other receivables	71,813	69,035
	Work in progress	8,897	254
	Current income tax assets	3,031	1,569
	Prepaid expenses	3,321	2,614
	Inventories	5,491	5,241
		113,777	99,948
Equity accounted investments		27,650	26,517
Property, plant and equipment		90,645	63,027
Goodwill		21,250	15,139
Other intangible assets		17,869	18,295
Other non-current assets		1,710	1,433
Post-employment benefit assets		789	870
Non-current financial assets		3,208	6,251
Deferred income tax assets		7,480	7,826
Total assets		284,378	239,306
Liabilities
Current liabilities
	Short-term bank loans	─	2,087
	Trade and other payables	39,244	31,999
	Deferred revenue	2,326	1,597
	Current income tax liabilities	2,010	4,838
	Dividends payable	819	699
	Current portion of long-term debt	1,257	2,034
	Provisions	620	1,320
		46,276	44,574
Long-term debt		32,063	3,598
Provisions		621	604
Deferred income tax liabilities		9,325	10,201
Post-employment benefit obligations		11,826	11,275
Deferred revenue		5,033	─
Non-current financial liabilities		7,190	5,372
Total liabilities		112,334	75,624
Equity
Share capital		14,956	15,030
Retained earnings		139,493	135,552
Accumulated other comprehensive income		2,830	1,309
Equity attributable to owners of the Company		157,279	151,891
Non-controlling interests		14,765	11,791
Total equity		172,044	163,682
Total liabilities and equity		284,378	239,306

Condensed Consolidated Interim Statements of Changes in Equity (in thousands of Canadian dollars) (unaudited)
		Attributable to owners of the Company
			Accumulated other comprehensive income
		Share capital	Cash flow hedges	Foreign currency translation	Retained earnings	Total	Non-controlling interests	Total equity
		$	$	$	$	$	$	$
Balance as at January 1, 2014		15,030	(33)	1,342	135,552	151,891	11,791	163,682
Profit for the period		-	-	-	23,750	23,750	2,322	26,072
Other comprehensive income
	Currency translation differences arising on translation of foreign operations	-	-	1,519	-	1,519	-	1,519
	Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	-	-	-	(624)	(624)	-	(624)
	Share of other comprehensive income of equity accounted investments, net of income taxes	-	2	-	45	47	-	47
Total comprehensive income for the period		-	2	1,519	23,171	24,692	2,322	27,014
Repurchase of Class A shares		(7)	-	-	(363)	(370)	-	(370)
Issuance and repurchase of Class B shares		(67)	-	-	(6,649)	(6,716)	-	(6,716)
Non-controlling interest arising on a business acquisition		-	-	-	-	-	1,475	1,475
Issuance and repurchase of share capital by a subsidiary		-	-	-	(167)	(167)	(823)	(990)
Dividends on Class A shares		-	-	-	(6,848)	(6,848)	-	(6,848)
Dividends on Class B shares		-	-	-	(5,203)	(5,203)	-	(5,203)
Balance as at September 27, 2014		14,956	(31)	2,861	139,493	157,279	14,765	172,044
		Attributable to owners of the Company
			Accumulated other comprehensive income
		Share capital	Cash flow hedges	Foreign currency translation	Retained earnings	Total	Non- controlling interests	Total equity
		$	$	$	$	$	$	$
Balance as at January 1, 2013		15,139	(9)	(453)	111,328	126,005	8,612	134,617
Profit for the period		-	-	-	20,890	20,890	2,038	22,928
Other comprehensive income
	Currency translation differences arising on translation of foreign operations	-	-	917	-	917	-	917
	Remeasurement gains on benefit obligation and return on retirement plan assets excluding amounts included in profit for the period, net of income taxes	-	-	-	3,299	3,299	-	3,299
	Cash flow hedges, net of income taxes	-	5	-	-	5	-	5
	Share of other comprehensive income of equity accounted investments, net of income taxes	-	(26)	-	-	(26)	-	(26)
Total comprehensive income for the period		-	(21)	917	24,189	25,085	2,038	27,123
Repurchase of Class A shares		(10)	-	-	(226)	(236)	-	(236)
Issuance and repurchase of Class B shares		60	-	-	(942)	(882)	-	(882)
Repurchase of share capital by a subsidiary		-	-	-	-	-	(126)	(126)
Dividends on Class A shares		-	-	-	(1,069)	(1,069)	-	(1,069)
Dividends on Class B shares		-	-	-	(849)	(849)	-	(849)
Balance as at September 28, 2013		15,189	(30)	464	132,431	148,054	10,524	158,578

Condensed Consolidated Interim Statements of Cash Flows (in thousands of Canadian dollars) (unaudited)
		For the nine months ended
		September 27, 2014	September 28, 2013
		$	$
Operating activities
	Profit for the period	26,072	22,928
	Items not affecting cash and cash equivalents	18,268	13,542
	Cash generated from operations	44,340	36,470
	Dividends received from equity accounted investments	2,646	9,500
	Contributions to defined benefit retirement plans	(1,271)	(1,051)
	Settlement of provisions	(45)	(340)
	Changes in non-cash working capital items	(6,480)	(7,795)
	Income taxes paid	(12,039)	(3,999)
		27,151	32,785
Financing activities
	Net change in short-term bank loans	(2,087)	125
	Issuance of long-term debt, net of transaction cost	32,000	-
	Repayment of long-term debt	(5,596)	(15,518)
	Interest paid	(433)	(438)
	Repurchase of Class A shares	(370)	(236)
	Issuance of Class B shares	146	20
	Repurchase of Class B shares	(7,097)	(1,079)
	Repurchase of share capital by a subsidiary	(991)	(126)
	Dividends paid on Class A shares	(6,773)	(1,013)
	Dividends paid on Class B shares	(5,158)	(805)
		3,641	(19,070)
Investing activities
	Customer repayment of investments in service contracts	172	6,456
	Interest received	416	824
	Cash acquired in business acquisitions	1,622	-
	Business acquisitions	(5,752)	-
	Acquisition of property, plant and equipment	(30,651)	(11,132)
	Proceeds from disposal of property, plant and equipment	863	464
	Acquisition of intangible assets	(175)	(224)
	Repayment of non-current financial assets	3,288	-
	Acquisition of other non-current assets	(274)	-
	Proceeds from disposal of other non-current assets	6	8
		(30,485)	(3,604)
Net change in cash and cash equivalents		307	10,111
Cash and cash equivalents, beginning of period		19,638	7,519
Effect of exchange rate on balances held in foreign currencies of foreign operations		(146)	(168)
Cash and cash equivalents, end of period		19,799	17,462
Additional information
Acquisition of property, plant and equipment included in trade and other payables		1,498	649

 

SOURCE: Logistec Corporation

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