WAJAX ANNOUNCES 2022 FOURTH QUARTER AND ANNUAL RESULTS, INCREASES QUARTERLY DIVIDEND BY 32%

TSX Symbol:  WJX

--Expanded Relationship with Hitachi, and Growth in Industrial Parts and Engineered Repair Services, Drove Record Revenue in 2022-- 

TORONTO, March 6, 2023 /CNW/ - Wajax Corporation ("Wajax" or the "Corporation") today announced its 2022 fourth quarter and annual results. All monetary amounts are in Canadian dollars unless otherwise noted.

Selected Highlights for the Fourth Quarter and Full Year

• Fourth quarter revenue of $541.3 million and full year revenue of $1.963 billion up 34.4% and 19.9%, respectively, over 2021;
  
  
• Fourth quarter adjusted EBITDA of $42.3 million and full year adjusted EBITDA of $165.9 million up 48.6% and 13.9%, respectively, over 2021⁽¹⁾;
  
  
• Fourth quarter adjusted net earnings of $17.8 million and full year adjusted net earnings of $69.8 million up 154.2% and 35.7%, respectively, over 2021⁽¹⁾; and
  
  
• Exited 2022 with backlog of $468.8 million.⁽¹⁾

"In 2022 we delivered record revenue of nearly $2 billion and strong adjusted earnings per share growth of nearly 35% on a fully diluted basis", said Iggy Domagalski, President and Chief Executive Officer. "In addition to benefiting from our enhanced relationship with Hitachi, industrial parts and engineered repair services sales demonstrated robust year-over-year growth due, in part, to elevated commodity prices and sustained capital spending by customers across all regions.⁽¹⁾

"During the first half of the year, improved cash flow from operations allowed us to make early repayment of our acquisition credit facility and fund two tuck-in acquisitions, further expanding our ERS footprint and service offerings. In 2022, we generated $69.1 million in cash flow from operations, reflecting investments in inventory and increases in receivables to support a growing business. We continue to manage our balance sheet prudently, and saw our leverage ratio decline to a 10-year low of 1.10 times during the year, before rising slightly to 1.13 times at year-end. Our strong balance sheet gives us the flexibility to invest in our expanded Hitachi relationship, additional organic initiatives and acquisition opportunities to help drive future growth."⁽¹⁾

(Dollars in millions, except per share data)	Three Months Ended December 31			Year Ended December 31
	2022	2021	% change	2022	2021	% change
CONSOLIDATED RESULTS
Revenue	$541.3	$402.8	34.4 %	$1,962.8	$1,637.3	19.9 %
Equipment sales	$202.2	$119.8	68.8 %	$628.6	$484.2	29.8 %
Product support	$118.3	$102.8	15.1 %	$483.9	$437.6	10.6 %
Industrial parts	$137.9	$108.7	26.9 %	$535.8	$438.1	22.3 %
Engineered repair services (ERS)	$72.6	$61.9	17.2 %	$275.5	$241.7	14.0 %
Equipment rental	$10.2	$9.6	7.1 %	$39.1	$35.5	10.0 %
Net earnings	$16.6	$8.0	108.9 %	$72.4	$53.2	36.0 %
Basic earnings per share^(2)	$0.78	$0.37	108.5 %	$3.38	$2.50	35.4 %
Adjusted net earnings^(1)(3)	$17.8	$7.0	154.2 %	$69.8	$51.5	35.7 %
Adjusted basic earnings per share^(1)(2)(3)	$0.83	$0.33	153.7 %	$3.26	$2.41	35.1 %
Adjusted EBITDA^(1)	$42.3	$28.5	48.6 %	$165.9	$145.6	13.9 %

Outlook

Moving into 2023, Wajax continues to see solid fundamentals in many of the markets it serves - particularly mining, energy and construction - supported by relatively elevated key commodity prices and sustained budgeting for capital projects. The Corporation started 2023 with a strong backlog of $468.8 million, up 10.5% from 2022, which supports management's confidence in the near-term future. In addition to expected growth in its heavy equipment business, Wajax anticipates further strong demand in its less cyclical industrial parts and engineered repair services businesses, building on the 22.3% and 14.0% top-line growth seen in those categories, respectively, in 2022. Wajax expects the challenges of 2023 to be similar to those of 2022 – ongoing supply chain volatility, higher interest rates, inflation, and a tight labour market.⁽¹⁾

The Corporation's core strategic priorities remain unchanged and Wajax is focused on continuing to invest in its people and their overall health and well-being, delivering exceptional customer value, organically growing its business, transacting on a robust acquisition pipeline, leveraging its enhanced relationship with Hitachi, prudently managing its balance sheet, deploying its ERP system, and entrenching sustainability into the business.

Dividend Increase

Wajax also today announced that its Board of Directors has approved a 32% increase in the Corporation's quarterly dividend. The Corporation has declared a dividend of $0.33 per share for the first quarter of 2023, payable on April 4, 2023, to shareholders of record on March 15, 2023.

"The increase in our quarterly dividend, representing an additional annual outlay of approximately $6.9 million,  reflects growing confidence in both our near- and longer-term outlooks, which is being driven by our expanded relationship with Hitachi, as well as solid demand for the full suite of products and services we offer across our business," said Mr. Domagalski. "Our strong ability to generate cash flow, coupled with over $300 million in availability on our bank credit facility, allows us to invest in organic growth and acquisition opportunities, while supporting this increased distribution to our shareholders."

Fourth Quarter Highlights

• Revenue in the fourth quarter of 2022 increased $138.5 million, or 34.4%, to $541.3 million, from $402.8 million in the fourth quarter of 2021. Regionally:

•  
• Revenue in western Canada of $278.8 million increased 64.3% from the prior year due primarily to robust growth in equipment and product support sales in the mining, and construction and forestry categories, and strength in the engineered repair services ("ERS") and industrial parts categories.
• Revenue in central Canada of $86.9 million increased 14.4% from the prior year mainly due to organic growth in industrial parts sales.
• Revenue in eastern Canada of $175.6 million increased 11.8% from the prior year due primarily to organic industrial parts growth driven by higher bearings sales, and higher equipment sales in the construction and forestry, and material handling categories.

• Gross profit margin of 18.1% in the fourth quarter of 2022 decreased 220 basis points ("bps") compared to the same period of 2021. The decrease in margin was driven primarily by lower product support margins and a higher proportion of equipment sales, largely due to the sale of several large mining shovels in the fourth quarter of 2022 without any similar sales in the same period of the prior year. These factors contributing to the decrease in margin were partially offset by higher equipment margins.⁽¹⁾

• Selling and administrative expenses as a percentage of revenue decreased to 13.2% in the fourth quarter of 2022 from 16.5% in the fourth quarter of 2021, driven by the 34.4% increase in revenue over the prior year. Selling and administrative expenses in the fourth quarter of 2022 increased $4.9 million, or 7.4%, compared to the fourth quarter of 2021, due primarily to higher personnel costs as the volume of business increased over the prior year.⁽¹⁾

• EBIT increased $11.4 million, or 74.4%, to $26.7 million in the fourth quarter of 2022 versus $15.3 million in 2021. The year-over-year increase in EBIT resulted primarily from higher sales volumes and equipment margins, offset partially by lower product support margins, a higher proportion of equipment sales, and increased selling and administrative expenses.

• The Corporation generated net earnings of $16.6 million, or $0.78 per share, in the fourth quarter of 2022 versus $8.0 million, or $0.37 per share, in 2021. The Corporation generated adjusted net earnings of $17.8 million, or $0.83 per share, in the fourth quarter of 2022 versus $7.0 million, or $0.33 per share, in 2021. Adjusted net earnings for the quarter excludes non-cash losses on mark to market of derivative instruments of $1.1 million after-tax, or $0.05 per share (2021 – losses of $0.2 million after-tax, or $0.01 per share). Adjusted net earnings in the same period of 2021 also excluded a gain recorded on the sale of properties of $1.2 million after-tax, or $0.06 per share.⁽¹⁾

• Adjusted EBITDA margin increased to 7.8% in the fourth quarter of 2022 from 7.1% in 2021.⁽¹⁾

• Cash flows generated from operating activities amounted to $19.1 million in the fourth quarter of 2022, compared to $36.0 million in the same quarter of the previous year. The decrease of $16.9 million was mainly attributable to a decrease in cash generated from changes in non-cash operating working capital of $30.3 million, which was driven largely by an increase in accounts receivable of $33.0 million in the fourth quarter of 2022 as compared to an increase in accounts receivable of $1.9 million in the same quarter of the previous year. This decrease in cash generated was partially offset by an increase in net earnings excluding items not affecting cash flow of $14.5 million.

• The Corporation's backlog at December 31, 2022 of $468.8 million decreased $90.0 million, or 16.1%, compared to September 30, 2022 due primarily to deliveries of multiple mining shovels that were in the prior quarter's backlog, along with most other categories completing more deliveries in the quarter versus new orders added to backlog, most notably in the construction and forestry category. These decreases were partially offset by higher ERS orders.⁽¹⁾

• Working capital of $346.0 million at December 31, 2022 increased $3.4 million from September 30, 2022, due primarily to higher trade and other receivables and inventory, partially offset by higher accounts payable and accrued liabilities and income taxes payable. Working capital efficiency was 16.8%, a decrease of 80 bps from September 30, 2022, due to the higher trailing 12-month revenue.⁽¹⁾

• The Corporation's leverage ratio decreased to 1.13 times at December 31, 2022, compared to 1.28 times at September 30, 2022. The decrease in the leverage ratio was due to the combination of the lower debt level in the current period driven by cash generated from operating activities, and the higher trailing 12-month pro-forma adjusted EBITDA. The Corporation's senior secured leverage ratio was 0.71 times at December 31, 2022, compared to 0.81 times at September 30, 2022.⁽¹⁾

• Effective October 6, 2022, the Corporation amended its $400.0 million bank credit facility to extend the maturity date from October 1, 2026 to October 1, 2027. At December 31, 2022, Wajax had borrowed $85.0 million and issued $6.2 million of letters of credit for a total utilization of $91.1 million of its $400.0 million bank credit facility.

• Subsequent to quarter-end and effective January 23, 2023, Mark Edgar was appointed to the role of Chief People Officer. Prior to joining Wajax, Mr. Edgar's career has included extensive human resources experience gained as Senior Vice President, Human Resources for Royal Sun Alliance Canada, Head of Human Resources - Corporate, for Centrica plc, the parent company of British Gas, and Head of Human Resources - Customer Group, for British Sky Broadcasting plc (now Sky plc).

Conference Call Details

Wajax will webcast its Fourth Quarter Financial Results Conference Call. You are invited to listen to the live webcast on Tuesday, March 7, 2023 at 2:00 p.m. ET. To access the webcast, please visit our website wajax.com, under "Investor Relations", "Events and Presentations", "Q4 and Full Year 2022 Financial Results" and click on the "Webcast" link. An archive of the webcast will be available following the live presentation.

About Wajax Corporation

Founded in 1858, Wajax (TSX: WJX) is one of Canada's longest-standing and most diversified industrial products and services providers. The Corporation operates an integrated distribution system providing sales, parts and services to a broad range of customers in diverse sectors of the Canadian economy, including: construction, forestry, mining, industrial and commercial, oil sands, transportation, metal processing, government and utilities, and oil and gas.

The Corporation's goal is to be Canada's leading industrial products and services provider, distinguished through its three core capabilities: sales force excellence, the breadth and efficiency of repair and maintenance operations, and the ability to work closely with existing and new vendor partners to constantly expand its product offering to customers. The Corporation believes that achieving excellence in these three areas will position it to create value for its customers, employees, vendors and shareholders.

Notes:

(1)	"Adjusted net earnings", "Adjusted basic and diluted earnings per share", "Adjusted EBITDA", "Adjusted EBITDA margin", "Backlog", "Leverage ratio", "Senior secured leverage ratio", "Working capital", "Gross profit margin", "Selling and administrative expenses as a percentage of revenue" and "Pro-forma adjusted EBITDA" do not have standardized meanings prescribed by generally accepted accounting principles ("GAAP"). See the Non-GAAP and Other Financial Measures section later in this press release.
(2)	Weighted average shares, net of shares held in trust, outstanding for calculation of basic and diluted earnings per share for the three months ended December 31, 2022 was 21,453,250 (2021 – 21,409,323) and 22,228,401 (2021 – 22,145,597), respectively.
	Weighted average shares, net of shares held in trust, outstanding for calculation of basic and diluted earnings per share for the year ended December 31, 2022 was 21,423,140 (2021 – 21,328,093) and 22,196,918 (2021 – 22,026,875), respectively.
(3)	Net earnings excluding the following:
	a.	after-tax non-cash losses on mark to market of derivative instruments of $1.1 million (2021 – losses of $0.2 million), or basic and diluted loss per share of $0.05 (2021 – loss per share of  $0.01) for the three months ended December 31, 2022.
	b.	after-tax non-cash gains on mark to market of derivative instruments of $2.6 million (2021 – losses of less than $0.1 million), or basic and diluted earnings per share of $0.12 (2021 – loss of less than $0.01) for the year ended December 31, 2022.
	c.	after-tax gain recorded on the sale of properties of nil (2021 – $1.2 million), or basic and diluted earnings per share of nil (2021 – $0.06 and $0.05 respectively) for the three months ended December 31, 2022.
	d.	after-tax gain recorded on the sale of properties of nil (2021 – $2.1 million), or basic and diluted earnings per share of nil (2021 – $0.10) for the year ended December 31, 2022.
	e.	after-tax Tundra Process Solutions Ltd. ("Tundra") transaction costs of nil (2021 – $0.3 million), or basic and diluted earnings per share of nil (2021 – $0.01) for the year ended December 31, 2022.

Non-GAAP and Other Financial Measures

The press release contains certain non-GAAP and other financial measures that do not have a standardized meaning prescribed by GAAP. Therefore, these financial measures may not be comparable to similar measures presented by other issuers. Investors are cautioned that these measures should not be construed as an alternative to net earnings or to cash flow from operating, investing, and financing activities determined in accordance with GAAP as indicators of the Corporation's performance. The Corporation's management believes that:

(i)	these measures are commonly reported and widely used by investors and management;
(ii)	the non-GAAP measures are commonly used as an indicator of a company's cash operating performance, profitability and ability to raise and service debt;
(iii)	"Adjusted net earnings" and "Adjusted basic and diluted earnings per share" provide indications of the results by the Corporation's principal business activities prior to recognizing non-recurring costs (recoveries) and non-cash losses (gains) on mark to market of derivative instruments. These adjustments to net earnings and basic and diluted earnings per share allow the Corporation's management to consistently compare periods by removing infrequent charges incurred outside of the Corporation's principal business activities and the impact of unrealized losses (gains) resulting from fluctuations in interest rates and the Corporation's share price;
(iv)	"Adjusted EBITDA" provides an indication of the results by the Corporation's principal business activities prior to recognizing non-recurring costs (recoveries) and non-cash losses (gains) on mark to market of derivative instruments. These adjustments to net earnings allow the Corporation's management to consistently compare periods by removing infrequent charges incurred outside of the Corporation's principal business activities, the impact of unrealized losses (gains) resulting from fluctuations in interest rates and the Corporation's share price, the impact of fluctuations in finance costs related to the Corporation's capital structure, the impact of tax rates, and the impact of depreciation and amortization of long-term assets; and
(v)	"Pro-forma adjusted EBITDA" provides the same utility as Adjusted EBITDA described above, however pursuant to the terms of the bank credit facility, is adjusted for the EBITDA of business acquisitions made during the period as if they were made at the beginning of the trailing 12-month period, and for the deduction of payments of lease liabilities. Pro-forma adjusted EBITDA is used in calculating the Leverage ratio and Senior secured leverage ratio.

Non-GAAP financial measures are identified and defined below:

Funded net debt	Funded net debt includes bank indebtedness, debentures and total long-term debt, net of cash. Funded net debt is relevant in calculating the Corporation's funded net debt to total capital, which is a non-GAAP ratio commonly used as an indicator of a company's ability to raise and service debt.
Debt	Debt is funded net debt plus letters of credit. Debt is relevant in calculating the Corporation's leverage ratio, which is a non-GAAP ratio commonly used as an indicator of a company's ability to raise and service debt.
Total capital	Total capital is shareholders' equity plus funded net debt.
EBITDA	Net earnings (loss) before finance costs, income tax expense, depreciation and amortization.
Adjusted net earnings (loss)	Net earnings (loss) before (gain) loss recorded on the sale of properties, non-cash losses (gains) on mark to market of derivative instruments and Tundra transaction costs.
Adjusted basic and diluted earnings (loss) per share	Basic and diluted earnings (loss) per share before (gain) loss recorded on the sale of properties, non-cash losses (gains) on mark to market of derivative instruments and Tundra transaction costs.
Adjusted EBITDA	EBITDA before (gain) loss recorded on the sale of properties, non-cash losses (gains) on mark to market of derivative instruments and Tundra transaction costs.
Pro-forma adjusted EBITDA	Defined as adjusted EBITDA adjusted for the EBITDA of business acquisitions made during the period as if they were made at the beginning of the trailing 12-month period pursuant to the terms of the bank credit facility and the deduction of payments of lease liabilities.
Working capital	Defined as current assets less current liabilities, as presented in the consolidated statements of financial position.
Other working capital amounts	Defined as working capital less trade and other receivables and inventory plus accounts payable and accrued liabilities, as presented in the consolidated statements of financial position.

Non-GAAP ratios are identified and defined below:

EBITDA margin	Defined as EBITDA (defined above) divided by revenue, as presented in the consolidated statements of earnings.
Adjusted EBITDA margin	Defined as adjusted EBITDA (defined above) divided by revenue, as presented in the consolidated statements of earnings.
Leverage ratio	The leverage ratio is defined as debt (defined above) at the end of a particular quarter divided by trailing 12-month pro-forma adjusted EBITDA (defined above). The Corporation's objective is to maintain this ratio between 1.5 times and 2.0 times.
Senior secured leverage ratio	The senior secured leverage ratio is defined as debt (defined above) excluding debentures at the end of a particular quarter divided by trailing 12-month pro-forma adjusted EBITDA (defined above).
Funded net debt to total capital	Defined as funded net debt (defined above) divided by total capital (defined above).
Working capital efficiency	Trailing four-quarter average working capital (defined above) as a percentage of the trailing 12-month revenue.

Supplementary financial measures are identified and defined below:

EBIT margin	Defined as EBIT divided by revenue, as presented in the consolidated statements of earnings.
Backlog	Backlog is a management measure which includes the total sales value of customer purchase commitments for future delivery or commissioning of equipment, parts and related services, including ERS projects. This differs from the remaining performance obligations as defined by IFRS 15 Revenue from Contracts with Customers. There is no directly comparable GAAP financial measure for Backlog.
Gross profit margin	Defined as gross profit divided by revenue, as presented in the consolidated statements of earnings.
Selling and administrative expenses as a percentage of revenue	Defined as selling and administrative expenses divided by revenue, as presented in the consolidated statements of earnings.

Reconciliation of the Corporation's net earnings to adjusted net earnings and adjusted basic and diluted earnings per share is as follows:

	Three months ended		Year ended
	December 31		December 31
	2022	2021	2022	2021
Net earnings	$              16.6	$                8.0	$              72.4	$              53.2
Gain recorded on the sale of properties, after-tax	—	(1.2)	—	(2.1)
Non-cash losses (gains) on mark to market of derivative instruments, after-tax	1.1	0.2	(2.6)	—
Tundra transaction costs, after-tax	—	—	—	0.3
Adjusted net earnings	$              17.8	$                7.0	$              69.8	$              51.5
Adjusted basic earnings per share^(1)	$              0.83	$              0.33	$              3.26	$              2.41
Adjusted diluted earnings per share^(1)	$              0.80	$              0.32	$              3.15	$              2.34

(1)

For the three months ended December 31, 2022, the numbers of basic and diluted shares outstanding were 21,453,250 and 22,228,401, respectively (2021 – 21,409,323 and 22,145,597, respectively). For the year ended December 31, 2022, the numbers of basic and diluted shares outstanding were 21,423,140 and 22,196,918, respectively (2021 – 21,328,093 and 22,026,875, respectively).

Reconciliation of the Corporation's EBIT to EBITDA, Adjusted EBITDA and Pro-forma adjusted EBITDA is as follows:

	Three months ended		Year ended
	December 31 2022	December 31 2021	December 31 2022	December 31 2021
EBIT	$             26.7	$            15.3	$            113.9	$               92.3
Depreciation and amortization	14.1	14.3	55.5	55.4
EBITDA	$              40.8	$             29.7	$             169.3	$             147.7
Gain recorded on the sale of properties	—	(1.5)	—	(2.5)
Non-cash losses (gains) on mark to market of derivative instruments^(1)	1.5	0.3	(3.5)	—
Tundra transaction costs^(2)	—	—	—	0.4
Adjusted EBITDA	$              42.3	$            28.5	$             165.9	$            145.6
Payment of lease liabilities^(3)	(8.3)	(7.8)	(32.0)	(28.9)
Pro-forma adjusted EBITDA	$              34.0	$             20.6	$             133.9	$             116.7

(1)	Non-cash losses (gains) on mark to market of non-hedged derivative instruments.
(2)	In 2021, the Corporation incurred transaction costs relating to the Tundra acquisition. These costs were primarily for advisory services.
(3)	Effective with the reporting period beginning on January 1, 2019 and the adoption of IFRS 16, the Corporation amended the definition of Funded net debt to exclude lease liabilities not considered part of debt. As a result, the corresponding lease costs must also be deducted from EBITDA for the purpose of calculating the leverage ratio.

Calculation of the Corporation's funded net debt, debt, leverage ratio and senior secured leverage ratio is as follows:

	December 31 2022	December 31 2021
Bank indebtedness (cash)	$                      5.2	$                  (10.0)
Debentures	55.8	55.2
Long-term debt	83.6	98.2
Funded net debt	$                 144.6	$                 143.5
Letters of credit	6.2	7.3
Debt	$                 150.8	$                 150.7
Pro-forma adjusted EBITDA^(1)	$                 133.9	$                 116.7
Leverage ratio^(2)	1.13	1.29
Senior secured leverage ratio^(3)	0.71	0.82

(1)	For the year ended December 31, 2022 and December 31, 2021.
(2)	Calculation uses debt divided by the trailing four-quarter Pro-forma adjusted EBITDA. This leverage ratio is calculated for purposes of monitoring the Corporation's objective target leverage ratio of between 1.5 times and 2.0 times, and is different from the leverage ratio calculated under the Corporation's bank credit facility agreement.
(3)	Calculation uses debt excluding debentures divided by the trailing four-quarter Pro-forma adjusted EBITDA. While the calculation contains some differences from the leverage ratio calculated under the Corporation's bank credit facility agreement, the resulting leverage ratio under the bank credit facility agreement is not significantly different.

Calculation of total capital and funded net debt to total capital is as follows:

	December 31 2022	December 31 2021
Shareholders' equity	$                449.8	$                389.9
Funded net debt	144.6	143.5
Total capital	$                594.4	$                533.4
Funded net debt to total capital	24.3 %	26.9 %

Calculation of the Corporation's working capital and other working capital amounts is as follows:

	December 31 2022	December 31 2021
Total current assets	$                 860.1	$                 681.4
Total current liabilities	514.1	367.9
Working capital	$                 346.0	$                 313.5
Trade and other receivables	(307.1)	(223.5)
Inventory	(462.2)	(388.7)
Accounts payable and accrued liabilities	423.8	305.8
Other working capital amounts	$                      0.7	$                      7.1

Cautionary Statement Regarding Forward-Looking Information

This news release contains certain forward-looking statements and forward-looking information, as defined in applicable securities laws (collectively, "forward-looking statements"). These forward-looking statements relate to future events or the Corporation's future performance. All statements other than statements of historical fact are forward-looking statements. Often, but not always, forward looking statements can be identified by the use of words such as "plans", "anticipates", "intends", "predicts", "expects", "is expected", "scheduled", "believes", "estimates", "projects" or "forecasts", or variations of, or the negatives of, such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors beyond the Corporation's ability to predict or control which may cause actual results, performance and achievements to differ materially from those anticipated or implied in such forward-looking statements. To the extent any forward-looking information in this news release constitutes future-oriented financial information or financial outlook within the meaning of applicable securities law, such information is being provided to demonstrate the potential of the Corporation and readers are cautioned that this information may not be appropriate for any other purpose. There can be no assurance that any forward-looking statement will materialize. Accordingly, readers should not place undue reliance on forward looking statements. The forward-looking statements in this news release are made as of the date of this news release, reflect management's current beliefs and are based on information currently available to management. Although management believes that the expectations represented in such forward-looking statements are reasonable, there is no assurance that such expectations will prove to be correct. Specifically, this news release includes forward looking statements regarding, among other things: our belief that the Corporation's strong balance sheet gives us the flexibility to invest in our expanded Hitachi relationship, additional organic initiatives and acquisition opportunities to help drive future growth; our outlook for 2023, including the view that solid fundamentals persist in many of the markets Wajax serves – particularly, mining, energy and construction, and that our strong start-of-year backlog is supportive of our confidence in the near-term future; our expectation that Wajax's heavy equipment business will grow in 2023, and our anticipation of further strong demand in Wajax's less cyclical industrial parts and ERS businesses; our expectation that that the challenges of 2023 will be similar to 2022 - ongoing supply chain volatility, higher interest rates, inflation, and a tight labour market; our continued focus on investing in Wajax's people and their overall health and well-being, delivering exceptional customer value, organically growing the business, transacting on a robust acquisition pipeline, leveraging our enhanced relationship with Hitachi, prudently managing our balance sheet, deploying our new ERP system, and entrenching sustainability into our business; our growing confidence in Wajax's near- and longer- term outlooks, driven by Wajax's expanded relationship with Hitachi, as well as solid demand for the full suite of products and services offered across our business; our belief that our strong ability to generate cash flow, coupled with over $300 million available on our bank credit facility, allows us to invest in organic growth and acquisition opportunities, while supporting the increased distribution to shareholders announced above; and our goal of being Canada's leading industrial products and services provider, distinguished by our sales force excellence, the breadth and efficiency of our repair and maintenance operations, and our ability to work closely with existing and new vendor partners to constantly expand our product offering to customers, together with our belief that achieving excellence in these three areas will position us to create value for our customers, employees, vendors and shareholders. These statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions regarding: general business and economic conditions; the supply and demand for, and the level and volatility of prices for, oil, natural gas and other commodities; financial market conditions, including interest rates; the ability of Hitachi and Wajax to develop and execute successful sales, marketing and other plans related to the expanded direct distribution relationship which took effect on March 1, 2022; our ability to execute our One Wajax strategy, including our ability to execute on our organic growth priorities, complete and effectively integrate acquisitions, and successfully implement new information technology platforms, systems and software, such as our new ERP system; the continuing effects of the COVID-19 pandemic and actions taken by governments, public authorities, suppliers and customers in response to the novel coronavirus and its variants; the future financial performance of the Corporation; our costs; market competition; our ability to attract and retain skilled staff; our ability to procure quality products and inventory; and our ongoing relations with suppliers, employees and customers. The foregoing list of assumptions is not exhaustive. Factors that may cause actual results to vary materially include, but are not limited to: a continued or prolonged deterioration in general business and economic conditions, including as a result of new coronavirus variants or armed conflicts between nations; supply chain disruptions and shortages related to or arising from the impacts of COVID-19 or armed conflicts between nations; fluctuations in financial market conditions, including interest rates; the continuing impacts of the COVID-19 pandemic, including the duration and severity of travel, business and other restrictions imposed by governments and public authorities in response to COVID-19 and its variants; actions taken by our suppliers and customers in relation to the COVID-19 pandemic, including slowing, reducing or halting operations; the inability of Hitachi and Wajax to develop and execute successful sales, marketing and other plans related to the expanded direct distribution relationship which took effect on March 1, 2022; volatility in the supply and demand for, and the level of prices for, oil, natural gas and other commodities; a continued or prolonged decrease in the price of oil or natural gas; the level of demand for, and prices of, the products and services we offer; levels of customer confidence and spending; market acceptance of the products we offer; termination of distribution or original equipment manufacturer agreements; unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalation, our inability to reduce costs in response to slow-downs in market activity, unavailability of quality products or inventory, supply disruptions (including those caused by or related to the COVID-19 pandemic), job action and unanticipated events related to health, safety and environmental matters); our ability to attract and retain skilled staff and our ability to maintain our relationships with suppliers, employees and customers. The foregoing list of factors is not exhaustive. Further information concerning the risks and uncertainties associated with these forward-looking statements and the Corporation's business may be found in our annual MD&A, which has been filed on SEDAR. The forward-looking statements contained in this news release are expressly qualified in their entirety by this cautionary statement. The Corporation does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

Readers are cautioned that the risks described in our annual MD&A, are not the only risks that could impact the Corporation. Risks and uncertainties not currently known to the Corporation, or currently deemed to be immaterial, may have a material effect on the Corporation's business, financial condition or results of operations.

Additional information, including Wajax's Annual Report, is available on SEDAR at www.sedar.com. 

SOURCE Wajax Corporation

Iggy Domagalski, President and Chief Executive Officer, Email: [email protected]; Stuart Auld, Chief Financial Officer, Email: [email protected], Telephone #: [phone]