LOGISTEC REPORTS RECORD Q2 2022 RESULTS

MONTRÉAL, Aug. 4, 2022 /CNW Telbec/ - LOGISTEC Corporation ("LOGISTEC") (TSX: LGT.A) (TSX: LGT.B) (the "Company"), a marine and environmental services provider, announced today its financial results for the three-month and six-month periods ended June 25, 2022. LOGISTEC reports record results for a fifth consecutive quarter as it pursues its bold growth strategy in strong markets.

Highlights From the Second Quarter of 2022:

• Consolidated revenue totalled $219.0 million, up $46.5 million or 26.9%.
• Adjusted EBITDA ⁽¹⁾ closed at $34.2 million, up $6.9 million.
• Total diluted earnings per share of $1.00, up $0.22.
• Environmental services' backlog stood at $168.0 million.

Highlights From the First Half of 2022:

• Consolidated revenue totalled $360.4 million, up $83.0 million or 29.9%.
• Adjusted EBITDA ⁽¹⁾ closed at $42.0 million, up $8.5 million.
• Total diluted earnings per share of $0.54, up $0.20.

"The growth we achieved in both the second quarter and the first half of the year reflects our ability to capitalize on our sectors' strong market fundamentals, which continue to be spurred by the pandemic recovery, the ongoing public infrastructure spending, and the increasing private investments," said Carl Delisle, Chief Financial Officer. "We expect that this favorable backdrop will drive more growth as we are uniquely well positioned to take advantage of the long-term major trends, including the global infrastructure investments, the strengthening of our supply chain resilience, Environmental, Social and Governance ("ESG") priorities, and the related energy transition."

"I am proud of the way the LOGISTEC team, leaders in the field, managed the dynamic operating environment they faced in the second quarter of 2022 and once again we delivered a record performance," reinforced Madeleine Paquin, President and CEO. "And I am very pleased that as we continue to improve on our sustainability footprint by increasing revenues aligned with the United Nation Sustainability Development Goals ("SDGs"). In our recently published Sustainable Development Report, we disclosed that 40% of our 2021 revenue relates to clean revenue, demonstrating our commitment to a sustainable future."

Results From the Period

We delivered strong results for the second quarter of 2022. Consolidated revenue was $219.0 million for the period, an increase of $46.5 million or 26.9% over the same period in 2021. Our core markets are as robust as they have ever been, both in the U.S. and Canada. The diversification of LOGISTEC's activities, our scale, our reach, our deep expertise in the field and solid execution capabilities are leading to our success in essential and evolving supply chains and complex environmental projects.

Marine Services Segment

Revenue from the marine services segment reached $138.8 million in the second quarter of 2022, up $34.3 million or 32.8% compared with the same period in 2021. Our marine services segment continued to deliver excellent performance due to booming trade volumes in our core markets. We seized opportunities in this buoyant market to leverage our network and bring new solutions to today's supply chain challenges for the greater benefit of our customers.

^(1)	Adjusted EBITDA is a non-IFRS measure, please refer to the non-IFRS measure section.

Opportunities for growth also included the expansion of our operations into the heartland of the U.S., in Lemont (IL), a strategically located gateway to serve markets in the greater Chicago area. Our operations are already up and running at Lemont with the recent handling of steel pipes destined for the oil and gas market in southern U.S.

We strengthened our partnerships with strategic ports, signing productive long-term agreements across our network. We also made infrastructure improvements for our customers and communities through the purchase of new ecoefficient cranes. By investing in ecofriendly equipment, we are delivering on our ESG plan to reduce our carbon footprint and protect our environment for future generations.

Environmental Services Segment

Revenue from the environmental services segment was $80.1 million, up $12.1 million or 17.8% in the second quarter of 2022.

Although we were fortunate to start the season earlier with respect to our ALTRA water services in Toronto and Montréal, these benefits were somewhat offset by delays and project changes, particularly in American Process Group ("APG"), which led to lower than expected revenue and margins. However, we are now entering into our busy season and the overall book of business remains strong until the end of the year. Furthermore, we recently signed our first Construction, Renovation and Demolition ("CRD") contract, to revalorize residual materials, taking another important step as an environmental leader in deploying new circular economy solutions. The results of our per- and polyfluoroalkyl ("PFAS") pilots were excellent, as our proprietary solution was able to remove more than 99% of the PFAS compounds found in highly contaminated landfill sites.

During this quarter, our environmental team also received the prestigious "Distinction Award for Best Company and Organization" from Réseau Environnement, highlighting excellence in the development of technologies and recognizing the exceptional work of our team to preserve and renew natural resources.

Outlook

As we look forward, we are optimistic for the remainder of 2022. LOGISTEC is well positioned to face the headwinds, thanks to its financial strength, diversification, unique business model, wide-reaching North American network of terminals, and innovative environmental technologies.

Investments in infrastructure and upcoming ambitious ESG initiatives will provide strong growth opportunities over the coming years. Increased cargo handling activities are driven by strong demand, particularly in the U.S. Gulf Coast for the energy sector. Our environmental business is also off to a good start with a solid backlog of over $168.0 million for the second half the year. We are confident that we will continue to deliver a strong financial performance.

Dividends

On August 4, 2022, the Board of Directors elected to increase the dividend payment by 20.0% and declared a dividend of $0.11782 per Class A Common Share and $0.12959 per Class B Subordinate Voting Share, for a total consideration of $1.6 million. These dividends will be paid on October 7, 2022 to shareholders of record as of September 23, 2022.

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 53 ports and 79 terminals located in North America. LOGISTEC also offers marine transportation services geared primarily to the Arctic coastal trade as well as marine agency services to shipowners and operators serving the Canadian market. Furthermore, the Company operates in the environmental industry where it provides services to industrial, municipal and other governmental customers for the renewal of underground water mains, dredging, dewatering, contaminated soils and materials management, site remediation, risk assessment, and manufacturing of fluid transportation products.

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.

Non-IFRS Measure

Adjusted earnings before interest expense, income taxes, depreciation and amortization expense ("adjusted EBITDA") is not defined by IFRS and cannot be formally presented in financial statements. The definition of adjusted EBITDA excludes the configuration and customization costs related to the implementation of an Enterprise Resource Planning ("ERP") system and the Company's impairment charge. The definition of adjusted EBITDA used by the Company may differ from those used by other companies. Even though adjusted EBITDA is a non-IFRS measure, it is used by managers, analysts, investors, and other financial stakeholders to analyze and assess the Company's performance and management from a financial and operational standpoint.

The following table provides a reconciliation of profit for the period to adjusted EBITDA:

(in thousands of Canadian dollars)
	For the three months ended		For the six months ended
	June 25, 2022 $	June 26,   2021 $	June 25, 2022 $	June 26,   2021 $
Profit for the period	13,150	10,287	7,252	4,666
PLUS:
Depreciation and amortization expense	14,037	11,883	26,834	23,244
Net finance expense	3,105	2,522	5,934	4,955
Income taxes	2,049	2,542	(361)	616
Configuration and customization costs in a cloud    computing arrangement	1,881	—	2,364	—
Adjusted EBITDA	34,222	27,234	42,023	33,481

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 position 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 2021 annual report and include (but are not limited to) the impact of the COVID-19 pandemic on the Company's business and results of operations, 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.

Q2 2022 CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(unaudited)

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF EARNINGS

(in thousands of Canadian dollars, except per share amounts and number of shares)
	For the three months ended		For the six months ended
	June 25, 2022 $	June 26, 2021 $	June 25, 2022 $	June 26, 2021 $
Revenue	218,972	172,593	360,414	277,443
Employee benefits expense	(106,678)	(79,618)	(180,950)	(137,596)
Equipment and supplies expense	(60,477)	(47,397)	(100,999)	(73,121)
Operating expense	(15,263)	(10,524)	(27,355)	(20,146)
Other expenses	(8,725)	(7,877)	(15,980)	(13,698)
Depreciation and amortization expense	(14,037)	(11,883)	(26,834)	(23,244)
Share of profit of equity accounted investments	5,122	936	6,069	2,087
Other losses	(610)	(879)	(1,540)	(1,488)
Operating profit	18,304	15,351	12,825	10,237
Finance expense	(3,261)	(2,708)	(6,202)	(5,257)
Finance income	156	186	268	302
Profit before income taxes	15,199	12,829	6,891	5,282
Income taxes	(2,049)	(2,542)	361	(616)
Profit for the period	13,150	10,287	7,252	4,666
Profit attributable to:
Owners of the Company	13,024	10,241	7,006	4,517
Non-controlling interest	126	46	246	149
Profit for the period	13,150	10,287	7,252	4,666
Basic earnings per Class A Common Share ^(1)	0.96	0.75	0.52	0.33
Basic earnings per Class B Subordinate Voting Share ^(2)	1.06	0.84	0.57	0.37
Diluted earnings per Class A share	0.95	0.75	0.51	0.33
Diluted earnings per Class B share	1.06	0.83	0.57	0.36
Weighted average number of Class A Shares outstanding, basic and    diluted	7,371,689	7,377,022	7,374,355	7,377,022
Weighted average number of Class B Shares outstanding, basic	5,522,156	5,625,162	5,601,413	5,590,708
Weighted average number of Class B Shares outstanding, diluted	5,614,501	5,734,027	5,677,914	5,737,044

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

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME

(in thousands of Canadian dollars)
	For the three months ended		For the six months ended
	June 25, 2022 $	June 26, 2021 $	June 25, 2022 $	June 26, 2021 $
Profit for the period	13,150	10,287	7,252	4,666
Other comprehensive income (loss)
Items that are or may be reclassified to the consolidated    statements of earnings
Currency translation differences arising on translation of foreign    operations	6,142	(4,542)	3,653	(6,007)
Unrealized (loss) gain on translating debt designated as    hedging item of the net investment in foreign operations	(2,069)	3,546	(1,224)	4,488
Income taxes relating to translation of debt designated as    hedging item of the net investment in foreign operations	274	(235)	162	(360)
Gain on derivatives designated as cash flow hedges	1,137	26	1,613	90
Income taxes relating to derivatives designated as cash flow    hedges	(122)	(7)	(428)	(24)
Total items that are or may be reclassified to the consolidated    statements of earnings	5,362	(1,212)	3,776	(1,813)
Items that will not be reclassified to the consolidated statements    of earnings
Remeasurement gains on benefit obligation	4,642	—	9,239	4,174
Return on retirement plan assets	(1,431)	622	(2,884)	93
Income taxes on remeasurement of benefit obligation and    return on retirement plan assets	(850)	(165)	(1,684)	(1,131)
Total items that will not be reclassified to the consolidated    statements of earnings	2,361	457	4,671	3,136
Other comprehensive income (loss) for the period, net of income taxes	7,723	(755)	8,447	1,323
Total comprehensive income for the period	20,873	9,532	15,699	5,989
Total comprehensive income attributable to:
Owners of the Company	20,704	9,506	15,427	5,871
Non-controlling interest	169	26	272	118
Total comprehensive income for the period	20,873	9,532	15,699	5,989

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

(in thousands of Canadian dollars)
	As at June 25, 2022 $	As at December 31, 2021 $
Assets
Current assets
Cash and cash equivalents	17,069	37,530
Trade and other receivables	177,618	183,322
Contract assets	28,311	7,517
Current income tax assets	12,915	7,597
Inventories	21,584	16,830
Prepaid expenses and other	11,697	10,437
	269,194	263,233
Equity accounted investments	46,705	46,311
Property, plant and equipment	223,206	207,321
Right-of-use assets	157,555	135,049
Goodwill	184,096	182,706
Intangible assets	38,645	41,043
Non-current assets	2,428	2,448
Non-current financial assets	6,332	5,902
Deferred income tax assets	13,119	14,958
Total assets	941,280	898,971
Liabilities
Current liabilities
Short-term bank loans	4,202	8,600
Trade and other payables	118,712	127,044
Contract liabilities	12,837	14,801
Current income tax liabilities	4,413	10,442
Dividends payable	1,313	1,338
Current portion of lease liabilities	16,890	15,775
Current portion of long-term debt	5,404	3,427
	163,771	181,427
Lease liabilities	148,327	125,249
Long-term debt	231,090	191,927
Deferred income tax liabilities	24,929	25,684
Post-employment benefit obligations	10,341	16,212
Contract liabilities	1,933	2,133
Non-current liabilities	41,497	40,730
Total liabilities	621,888	583,362
Equity
Share capital	49,505	50,889
Retained earnings	255,766	254,621
Accumulated other comprehensive income	12,801	9,051
Equity attributable to owners of the Company	318,072	314,561
Non-controlling interest	1,320	1,048
Total equity	319,392	315,609
Total liabilities and equity	941,280	898,971

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY

(in thousands of Canadian dollars)
	Attributable to owners of the Company
	Share capital issued $	Retained earnings $	Accumulated other comprehensive income $	Total $	Non- controlling interest $	Total equity $
Balance as at January 1, 2022	50,889	254,621	9,051	314,561	1,048	315,609
Profit for the period	—	7,006	—	7,006	246	7,252
Other comprehensive income (loss)
Currency translation differences arising on    translation of foreign operations	—	—	3,627	3,627	26	3,653
Unrealized loss on translating debt    designated as hedging item of the net    investment in foreign operations, net of    income taxes	—	—	(1,062)	(1,062)	—	(1,062)
Remeasurement gains on benefit    obligation and return on retirement plan    assets, net of income taxes	—	4,671	—	4,671	—	4,671
Cash flow hedges, net of income taxes	—	—	1,185	1,185	—	1,185
Total comprehensive income for the period	—	11,677	3,750	15,427	272	15,699
Net remeasurement of written put option    liability	—	(124)	—	(124)	—	(124)
Issuance and repurchase of Class B shares	(1,384)	(7,872)	—	(9,256)	—	(9,256)
Class B shares to be issued under the    Executive Stock Option Plan	—	241	—	241	—	241
Other dividend	—	(127)	—	(127)	—	(127)
Dividends on Class A shares	—	(1,447)	—	(1,447)	—	(1,447)
Dividends on Class B shares	—	(1,203)	—	(1,203)	—	(1,203)
Balance as at June 25, 2022	49,505	255,766	12,801	318,072	1,320	319,392

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY (CONTINUED)

(in thousands of Canadian dollars)
	Attributable to owners of the Company
	Share capital issued $	Share capital to be issued $	Retained earnings $	Accumulated other comprehensive income $	Total $	Non- controlling interest $	Total equity $
Balance as at January 1, 2021	45,575	4,906	242,358	7,943	300,782	789	301,571
Profit for the year	—	—	4,517	—	4,517	149	4,666
Other comprehensive (loss) income
Currency translation differences arising on    translation of foreign operations	—	—	—	(5,976)	(5,976)	(31)	(6,007)
Unrealized gain on translating debt    designated as hedging item of the net    investment in foreign operations, net of    income taxes	—	—	—	4,128	4,128	—	4,128
Remeasurement gains on benefit    obligation and return on retirement plan    assets, net of income taxes	—	—	3,136	—	3,136	—	3,136
Cash flow hedges, net of income taxes	—	—	—	66	66	—	66
Total comprehensive income (loss) for the    period	—	—	7,653	(1,782)	5,871	118	5,989
Remeasurement of written put option liability	—	—	(593)	—	(593)	—	(593)
Repurchase of Class B shares	(83)	—	(338)	—	(421)	—	(421)
Issuance of Class B share capital to a    subsidiary shareholder	4,906	(4,906)	—	—	—	—	—
Class B shares to be issued under the    Executive Stock Option Plan	—	—	105	—	105	—	105
Dividends on Class A shares	—	—	(1,380)	—	(1,380)	—	(1,380)
Dividends on Class B shares	—	—	(1,160)	—	(1,160)	—	(1,160)
Balance as at June 26, 2021	50,398	—	246,645	6,161	303,204	907	304,111

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

(in thousands of Canadian dollars)
		For the six months ended
		June 25, 2022 $	June 26, 2021 $
Operating activities
Income for the period		7,252	4,666
Items not affecting cash and cash equivalents		27,952	28,875
Cash generated from operations		35,204	33,541
Dividends received from equity accounted investments		5,675	615
Contributions to defined benefit retirement plans		(393)	(428)
Settlement of provisions		(351)	(271)
Changes in non-cash working capital items		(20,774)	6,563
Income taxes paid		(10,715)	(6,607)
		8,646	33,413
Financing activities
Net change in short-term bank loans		(4,361)	—
Issuance of long-term debt, net of transaction costs		76,343	40,870
Repayment of long-term debt		(37,367)	(2,667)
Repayment of other non-current liabilities		—	(2,432)
Repayment of lease liabilities		(7,678)	(6,584)
Interest paid		(6,056)	(6,253)
Issuance of Class B shares		221	—
Repurchase of Class B shares		(9,937)	(421)
Dividends paid on Class A shares		(1,449)	(1,380)
Dividends paid on Class B shares		(1,227)	(1,145)
		8,489	19,988
Investing activities
Dividends paid to a non-controlling interest		(8,826)	—
Acquisition of property, plant and equipment		(27,607)	(19,520)
Proceeds from disposal of property, plant and equipment		798	316
Business combinations		(3,264)	(50,000)
Acquisition of intangible assets		(211)	(16)
Interest received		78	512
Cash receipts from other non-current financial assets		705	698
Acquisition of other non-current assets		(362)	(104)
Proceeds from disposal of other non-current assets		282	44
		(38,407)	(68,070)
Net change in cash and cash equivalents		(21,272)	(14,669)
Cash and cash equivalents, beginning of year		37,530	46,778
Effect of exchange rate on balances held in foreign currencies of foreign operations		811	288
Cash and cash equivalents, end of period		17,069	32,397
Additional information
Acquisition of property, plant and equipment included in trade and other payables		2,906	3,384
Issuance of Class B shares under the Employee Stock Purchase Plan for non-interest-bearing    loans		460	—

SOURCE Logistec Corporation

Carl Delisle, CPA, Chief Financial Officer, LOGISTEC Corporation, [email protected], [phone]