LOGISTEC REPORTS RECORD Q3 2022 RESULTS

MONTRÉAL, Nov. 3, 2022 /CNW/ - 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 nine-month periods ended September 24, 2022. LOGISTEC reports record results for a sixth consecutive quarter as it pursues its bold growth strategy in a continued positive momentum.

Highlights From the Third Quarter of 2022:

• Consolidated revenue totalled $284.2 million, up $48.0 million or 20.3%.
• Adjusted EBITDA ⁽¹⁾ closed at $58.7 million, up $9.0 million.
• Total diluted earnings per share of $2.43, up $0.39.

Highlights From the Nine-Month Period Ended September 24, 2022

• Consolidated revenue totalled $644.6 million, up $131.0 million or 25.5%.
• Adjusted EBITDA ⁽¹⁾ closed at $100.7 million, up $17.5 million.
• Total diluted earnings per share of $2.97, up $0.59.

"We can attribute our record third quarter results to the strength of our unique business model," said Carl Delisle, Chief Financial Officer. "Again, the diverse nature of our two business segments, the breadth of our network, the expanding scope of our expertise continue to strengthen our resiliency. As pressure grows on the global supply chain, we leveraged our network of port terminals across North America and found innovative ways to counter the effect of congestion, allowing our customers to benefit from both our gateway access and operational expertise."

"Our people have shown great agility in developing tailored solutions for our customers in markets that continue to evolve," said Madeleine Paquin, President and Chief Executive Officer. "I would like to recognize the dedication and passion of our teams who succeeded in delivering in an efficient and safe manner. We handled record volumes of cargo across our network and delivered on key environmental projects this past quarter, creating value for our stakeholders and communities, and this is reflected in our solid performance."

Results From the Period

LOGISTEC delivered very strong results for the third quarter of 2022. Consolidated revenue was $284.2 million for the period, an increase of $48.0 million or 20.3% over the same period in 2021. Our core markets remained strong in the USA and Canada. Our extensive network, the depth of our expertise and the diverse industries we served, enabled us to achieve another successful quarter in an ever-changing context.

Marine Services Segment

Revenue from the marine services segment reached $160.6 million in the third quarter of 2022, up $48.7 million or 43.6% compared with the same period in 2021. Our marine services segment delivered outstanding results due to strong demand, especially in the steel and wind energy industries. An important increase in cargo activities in the U.S. Gulf Coast was driven by strong activity in the energy sector.

We collaborated with our supply chain partners to increase capacity at our port terminals and facilities. With such high volumes of cargo, we further optimized terminal operations and leveraged safe and efficient handling methods to increase speed of delivery. To improve supply chain fluidity, we offer a customizable solution for just-in-time delivery to destination.

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

In September, LOGISTEC was named 2022 Terminal Operator of the Year at the Heavy Lift Awards Ceremony held in Hamburg, Germany. The award comes at a time of global challenges in the supply chain and recognizes LOGISTEC's ability to respond to and anticipate customers' needs with innovative solutions. LOGISTEC was also highly commended for Excellence in Environmental Performance, as it is leading the drive to a sustainable supply chain through concrete Environmental, Social, and Governance ("ESG") objectives, smart investments and continuous operational enhancements.

Environmental Services Segment

Revenue from the environmental services segment reached $123.6 million, slightly down by $0.7 million or 0.6% in the third quarter of 2022, which is consistent with last year's results. Traditional environmental services delivered their entire backlog for the quarter. However, some delays and project changes led to lower than expected revenue and margins. Given the seasonal and project-based nature of our operations, our focus will remain on achieving our business objectives and completing our projects before the end of the year.

We are continuing to position our ALTRA PFAS solutions to address the real and present negative impacts of per- and polyfluoroalkyl ("PFAS") in drinking water and soils, as public awareness and concerns grow regarding the health and environmental damage caused by these forever chemicals.

Outlook

We are well positioned to deliver a strong financial performance for the remainder of the year particularly in our marine services segment and keep developing innovative solutions in our environmental and water activities. As the global economy is in transition, LOGISTEC remains focused on its long-term strategic plan. Our unique business model in two highly important sectors, positions us to adapt to shifting markets, providing solutions for a resilient global supply chain and implementing innovative technologies in support of a sustainable future.

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:

	For the three months ended		For the nine months ended
	September 24, 2022 $	September 25,   2021 $	September 24, 2022 $	September 25,   2021 $
Profit for the period	31,766	26,757	39,018	31,423
PLUS:
Depreciation and amortization expense	14,056	12,564	40,890	35,808
Net finance expense	4,052	2,551	9,986	7,506
Income taxes	7,827	7,815	7,466	8,431
Configuration and customization costs in a cloud computing arrangement	1,024	—	3,388	—
Adjusted EBITDA	58,725	49,687	100,748	83,168

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.

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 nine months ended
		September 24, 2022 $		September 25, 2021 $		September 24, 2022 $		September 25, 2021 $
Revenue		284,209		236,171		644,623		513,614
Employee benefits expense		(129,554)		(110,596)		(310,504)		(248,192)
Equipment and supplies expense		(76,201)		(59,485)		(177,200)		(132,606)
Operating expense		(16,626)		(14,602)		(43,981)		(34,748)
Other expenses		(10,460)		(7,931)		(26,440)		(21,629)
Depreciation and amortization expense		(14,056)		(12,564)		(40,890)		(35,808)
Share of profit of equity accounted investments		6,342		4,020		12,411		6,107
Other (losses) gains		(9)		2,110		(1,549)		622
Operating profit		43,645		37,123		56,470		47,360
Finance expense		(4,178)		(2,660)		(10,380)		(7,917)
Finance income		126		109		394		411
Profit before income taxes		39,593		34,572		46,484		39,854
Income taxes		(7,827)		(7,815)		(7,466)		(8,431)
Profit for the period		31,766		26,757		39,018		31,423
Profit attributable to:
Owners of the Company		31,636		26,739		38,642		31,256
Non-controlling interest		130		18		376		167
Profit for the period		31,766		26,757		39,018		31,423
Basic earnings per Class A Common Share ^(1)		2.35		1.98		2.87		2.31
Basic earnings per Class B Subordinate Voting Share ^(2)		2.58		2.17		3.15		2.54
Diluted earnings per Class A share		2.34		1.95		2.85		2.28
Diluted earnings per Class B share		2.56		2.15		3.13		2.51
Weighted average number of Class A Shares outstanding, basic and diluted		7,361,022		7,377,022		7,369,911		7,377,022
Weighted average number of Class B Shares outstanding, basic		5,461,358		5,677,569		5,554,728		5,619,662
Weighted average number of Class B Shares outstanding, diluted		5,580,269		5,738,227		5,647,748		5,737,438

⁽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 nine months ended
	September 24, 2022 $		September 25, 2021 $		September 24, 2022 $		September 25, 2021 $
Profit for the period	31,766		26,757		39,018		31,423
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	9,258		5,775		12,911		(232)
Unrealized (loss) gain on translating debt designated as hedging item of the net investment in foreign operations	(3,172)		(4,275)		(4,396)		213
Income taxes relating to translation of debt designated as hedging item of the net investment in foreign operations	420		332		582		(28)
Gain on derivatives designated as cash flow hedges	201		10		1,814		100
Income taxes relating to derivatives designated as cash flow hedges	(53)		(3)		(481)		(27)
Total items that are or may be reclassified to the consolidated statements of earnings	6,654		1,839		10,430		26
Items that will not be reclassified to the consolidated statements of earnings
Remeasurement (losses) gains on benefit obligation	(1,443)		—		7,796		4,174
Return on retirement plan assets	(18)		125		(2,902)		218
Income taxes on remeasurement of benefit obligation and return on retirement plan assets	387		(33)		(1,297)		(1,164)
Total items that will not be reclassified to the consolidated statements of earnings	(1,074)		92		3,597		3,228
Other comprehensive income for the period, net of income taxes	5,580		1,931		14,027		3,254
Total comprehensive income for the period	37,346		28,688		53,045		34,677
Total comprehensive income attributable to:
Owners of the Company	37,142		28,642		52,569		34,513
Non-controlling interest	204		46		476		164
Total comprehensive income for the period	37,346		28,688		53,045		34,677

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION

(in thousands of Canadian dollars)
		As at  September 24, 2022 $	As at  December 31, 2021 $
Assets
Current assets
Cash and cash equivalents		21,522	37,530
Trade and other receivables		217,896	183,322
Contract assets		40,065	7,517
Current income tax assets		14,514	7,597
Inventories		20,994	16,830
Prepaid expenses and other		10,566	10,437
		325,557	263,233
Equity accounted investments		47,547	46,311
Property, plant and equipment		231,476	207,321
Right-of-use assets		160,034	135,049
Goodwill		187,571	182,706
Intangible assets		38,550	41,043
Non-current assets		2,221	2,448
Post-employment benefit assets		2,161	—
Non-current financial assets		8,325	5,902
Deferred income tax assets		14,996	14,958
Total assets		1,018,438	898,971
Liabilities
Current liabilities
Short-term bank loans		—	8,600
Trade and other payables		139,072	127,044
Contract liabilities		12,780	14,801
Current income tax liabilities		11,382	10,442
Dividends payable		1,575	1,338
Current portion of lease liabilities		17,178	15,775
Current portion of long-term debt		11,025	3,427
		193,012	181,427
Lease liabilities		151,618	125,249
Long-term debt		255,963	191,927
Deferred income tax liabilities		25,726	25,684
Post-employment benefit obligations		14,456	16,212
Contract liabilities		1,833	2,133
Non-current liabilities		25,448	40,730
Total liabilities		668,056	583,362
Equity
Share capital		49,480	50,889
Retained earnings		279,997	254,621
Accumulated other comprehensive income		19,381	9,051
Equity attributable to owners of the Company		348,858	314,561
Non-controlling interest		1,524	1,048
Total equity		350,382	315,609
Total liabilities and equity		1,018,438	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	—	38,642	—	38,642		376		39,018
Other comprehensive income (loss)
Currency translation differences arising on translation of foreign operations	—	—	12,811	12,811		100		12,911
Unrealized loss on translating debt designated as hedging item of the net investment in foreign operations, net of income taxes	—	—	(3,814)	(3,814)		—		(3,814)
Remeasurement gains on benefit obligation and return on retirement plan assets, net of income taxes	—	3,597	—	3,597		—		3,597
Cash flow hedges, net of income taxes	—	—	1,333	1,333		—		1,333
Total comprehensive income for the period	—	42,239	10,330	52,569		476		53,045
Net remeasurement of written put option liability	—	(5,025)	—	(5,025)		—		(5,025)
Issuance of Class B shares	683	—	—	683		—		683
Repurchase of Class B shares	(2,092)	(7,974)	—	(10,066)		—		(10,066)
Class B shares to be issued under the Executive Stock Option Plan	—	486	—	486		—		486
Other dividend	—	(127)	—	(127)		—		(127)
Dividends on Class A shares	—	(2,316)	—	(2,316)		—		(2,316)
Dividends on Class B shares	—	(1,907)	—	(1,907)		—		(1,907)
Balance as at September 24, 2022	49,480	279,997	19,381	348,858		1,524		350,382

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	—	—	31,256	—	31,256		167		31,423
Other comprehensive (loss) income
Currency translation differences arising on translation of foreign operations	—	—	—	(229)	(229)		(3)		(232)
Unrealized gain on translating debt designated as hedging item of the net investment in foreign operations, net of income taxes	—	—	—	185	185		—		185
Remeasurement gains on benefit obligation and return on retirement plan assets, net of income taxes	—	—	3,228	—	3,228		—		3,228
Cash flow hedges, net of income taxes	—	—	—	73	73		—		73
Total comprehensive income for the period	—	—	34,484	29	34,513		164		34,677
Remeasurement of written put option liability	—	—	(14,756)	—	(14,756)		—		(14,756)
Repurchase of Class B shares	(83)	—	(338)	—	(421)		—		(421)
Issuance of Class B share capital to a subsidiary shareholder	5,421	(4,906)	—	—	515		—		515
Class B shares to be issued under the Executive Stock Option Plan	—	—	241	—	241		—		241
Other dividend	—	—	(107)	—	(107)		—		(107)
Dividends on Class A shares	—	—	(2,104)	—	(2,104)		—		(2,104)
Dividends on Class B shares	—	—	(1,772)	—	(1,772)		—		(1,772)
Balance as at September 25, 2021	50,913	—	258,006	7,972	316,891		953		317,844

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

(in thousands of Canadian dollars)
		For the nine months ended
		September 24, 2022 $	September 25, 2021 $
Operating activities
Income for the period		39,018	31,423
Items not affecting cash and cash equivalents		48,847	46,264
Cash generated from operations		87,865	77,687
Dividends received from equity accounted investments		11,175	3,565
Contributions to defined benefit retirement plans		(542)	(752)
Settlement of provisions		(450)	(726)
Changes in non-cash working capital items		(55,262)	(30,133)
Income taxes paid		(15,654)	(8,019)
		27,132	41,622
Financing activities
Net change in short-term bank loans		(8,565)	524
Issuance of long-term debt, net of transaction costs		126,121	59,870
Repayment of long-term debt		(63,112)	(15,280)
Repayment of other non-current liabilities		—	(2,432)
Repayment of lease liabilities		(11,939)	(10,019)
Repayment of due to non-controlling interest		(19,086)	—
Interest paid		(10,086)	(8,962)
Issuance of Class B shares		221	130
Repurchase of Class B shares		(10,013)	(421)
Dividends paid on Class A shares		(2,173)	(2,069)
Dividends paid on Class B shares		(1,813)	(1,729)
		(445)	19,612
Investing activities
Dividends paid to a non-controlling interest		(8,826)	(107)
Acquisition of property, plant and equipment		(36,238)	(28,129)
Proceeds from disposal of property, plant and equipment		1,005	505
Business combinations		(3,264)	(50,390)
Acquisition of intangible assets		(211)	(14)
Interest received		150	565
Cash receipts from other non-current financial assets		1,058	1,049
Net acquisition of other non-current assets		(224)	(144)
		(46,550)	(76,665)
Net change in cash and cash equivalents		(19,863)	(15,431)
Cash and cash equivalents, beginning of year		37,530	46,778
Effect of exchange rate on foreign currency balance of foreign operations		3,855	61
Cash and cash equivalents, end of period		21,522	31,408
Additional information
Acquisition of property, plant and equipment included in trade and other payables		5,018	5,703
Issuance of Class B shares under the Employee Stock Purchase Plan for non-interest-bearing loans		462	385
Repurchase of Class B shares included in trade and other payables		53	—

SOURCE Logistec Corporation

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