AGT Food and Ingredients Inc. Announces First Quarter 2015 Results

SYMBOL: TSX: AGT

REGINA, May 12, 2015 /CNW/ - AGT Food and Ingredients Inc. (TSX:AGT) ("the Company" or "AGT") has announced its financial results for the three months ended March 31, 2015. 

Results include:  

  • Adjusted EBITDA* was $22.6 million for the three months ended March 31, 2015 compared to $17.1 million for three months ended March 31, 2014, an increase of 33% and compared to $24.4 million for three months ended December 31, 2014. Adjusted EBITDA* was $92.5 million for the trailing twelve months ended March 31, 2015 compared to $63.5 million for the trailing twelve months ended March 31, 2014, an increase of 46%.
  • Revenue was $385.2 million for the three months ended March 31, 2015 compared to $311.3 million for the three months ended March 31, 2014.
  • Adjusted EBITDA* as a percentage of revenue increased to 5.87% for the three months ended March 31, 2015 compared to 5.49% for the three months ended March 31, 2014.
  • Adjusted earnings per share* increased to $0.43 ($0.42 fully diluted) for the three months ended March 31, 2015 compared to $0.16 ($0.16 fully diluted) for the three months ended March 31, 2014.
  • Improvement in total accounts receivable days outstanding for the three months ended March 31, 2015 to 44 compared to 48 days for the three months ended March 31, 2014.
  • Dividend of $0.15 per share for the quarter ($0.60 per share on an annualized basis).

"This quarter continues to demonstrate the foundation for growth we have established for AGT. As global pulses markets look forward to seeding of what may be a significant crop in North America as well as harvest of domestic products in key consumption markets, importers continue to buy in patterns that are returning to traditional periods. This is good news for the global pulses sector and for AGT as well. Our ingredient business continues to progress and the expansions and enhancements we have announced previously are on track and proceeding as expected. Our food ingredient business unit is progressing as we expect, with positive feedback from customers and conversion of sample volumes to sales volumes. There are a lot of positives in AGT's business, and we plan to continue with our strategic growth plans," said Mr. Murad Al-Katib, President and CEO of AGT.

With regard to AGT's offer to purchase the assets of West Central Road & Rail Ltd. and Prairie Processing (1989) Ltd. ("WCRR"), including five producer and bulk loading sites and a processing facility in Saskatchewan for approximately aggregate $26.65 million, both expected to be completed in June 2015, Mr. Al-Katib commented, "This tuck-in is a key part of the growth plan for both our pulses business in Canada and Turkey as well as for our durum wheat and pasta business. The ability to originate and load bulk quantities of lentils, peas, durum wheat and other specialty crops and grains for shipment, using available and efficient modes of transportation, is important for AGT. The same producers who grow lentils are growing durum wheat and we have regular and positive contact with them on a daily basis. We expect these assets to extend our origination options to supply both lentils and durum wheat for pasta production to our operations in Turkey, as well as allow us to boost capacity there while returning value-added capacity back to our facilities in Canada that are currently doing bulk load lentil business. We expect production in Canada to continue at the levels we are currently seeing and this turnkey acquisition provides an efficient way to augment capacity and deal with capacity constraints in peak shipping windows."

These transactions are subject to customary closing conditions, including WCRR shareholder approval.

"AGT has announced and initiated many strategic initiatives over the past periods aimed at growing our business in a manner that leverages the significant and unique asset base we have globally. We are continuing to develop our strengths in origination and processing to maximize the opportunities before us globally. Our new business lines such as food ingredients and our retail packaged foods businesses are expected to support these initiatives and diversify our business as well. Viewed in a complete picture, we are pleased with how our strategy is being implemented by our management team and feel we will continue to deliver earnings growth for our shareholders as we grow and diversify AGT," said Mr. Huseyin Arslan, Executive Chairman of AGT's Board of Directors. 

The financial statements and notes thereto for the three months ended March 31, 2015, as well as the related management's discussion and analysis, have been filed under AGT's profile on www.sedar.com and have been posted on AGT's website at www.agtfoods.com. All amounts are reported in Canadian dollars.

AGT invites you to join our First Quarter 2015 conference call on Wednesday, May 13, 2015 at 1:30 p.m. Eastern time. To join the conference, please dial 1-800-319-4610 (Toll free in Canada & the U.S.) or +1-604-638-5340 (Outside Canada & the U.S.). 

A recording of the call will be available at www.agtfoods.com on Thursday, May 14, 2015.  A telephone replay will also be available until midnight Eastern time, Wednesday, June 10, 2015.  To access the replay, please call 1-800-319-6413 (toll free from Canada & the U.S.) or +1-604-638-9010 (from outside Canada & the U.S.).  When prompted, enter the code 4537, followed by the number sign (#).

AGT Food and Ingredients Inc. Profile
AGT Food and Ingredients Inc. (AGT) is a processor of value-added pulses, staple foods and ingredients for export and domestic markets as well as a supplier of retail packaged and canned foods to retail and food service sectors. Through its offices and processing facilities located in some of the best agricultural growing regions in Canada, the U.S., Turkey, China, Australia and South Africa, merchandising and sales offices in the U.K., the Netherlands, Spain, Switzerland and India and origination offices in Russia, AGT produces a full range of pulses and specialty crops including lentils, peas, chickpeas, beans and canary seed as well as food ingredients such as pulse flours, proteins, starches and fibres. Through its subsidiaries in Turkey, the Arbel Group, AGT also produces staple foods such as Arbella Pasta, rice, and milled wheat products, including bulgur and semolina.

Cautionary Statements
Certain statements in this press release are forward-looking statements. In particular, this press release contains forward-looking statements with respect to, among other things, AGT's growth opportunities, the completion of the referenced transactions, our originating options, production in Canada and expected synergies. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by AGT at the time of preparation, may prove to be incorrect. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of AGT (including its operating subsidiaries) to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the actual results of harvests, fluctuations in the price of lentils and other crops, failure of plant, equipment or processes to operate as anticipated, accidents or labour disputes, risks relating to the integration of acquisitions or to international operations, as well as those factors referred to in the section entitled "Risk Factors" in the Annual Information Form of AGT dated March 27, 2015 which is available on SEDAR at www.sedar.com, and which should be reviewed in conjunction with this document. Although AGT has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.  AGT expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.

Non-IFRS Financial Measures
*AGT provides some non-IFRS measures as supplementary information that Management believes may be useful to investors to explain AGT's financial results. These non-IFRS measures include Adjusted Gross Profit* (gross profit plus depreciation in cost of sales and finance income), Adjusted EBITDA* (earnings before finance expense, income taxes, depreciation and amortization, restructuring costs and any effects of non-cash, non-recurring and other costs and foreign exchange adjustment), Adjusted Net Earnings* and Adjusted Net Earnings Per Share* (earnings before any effects of non-cash, non-recurring and other costs, restructuring costs and foreign exchange adjustments), Net Debt* (bank indebtedness, short term financing and long term debt less cash) and Net Working Capital* (current assets less current liabilities). Adjusted Net Earnings* and Adjusted Net Earnings Per Share* do not include the tax effect of non-cash, non-recurring and other costs and foreign exchange. Management believes that Adjusted EBITDA*, Adjusted Net Earnings* and Adjusted Net Earnings Per Share*, Net Debt* and Net Working Capital* are important indicators of AGT's ability to generate liquidity through operating cash flow to fund future working capital needs, service outstanding debt and fund future capital expenditures and uses the metric for this purpose. The exclusion of non-cash and foreign exchange adjustments eliminates the non-cash impact on Adjusted EBITDA*, Adjusted Net Earnings* and Adjusted Net Earnings Per Share*. Adjusted EBITDA* and Adjusted Net Earnings*, Adjusted Net Earnings Per Share*, Net Debt* and Net Working Capital* are also used by investors and analysts for the purpose of valuing AGT. The intent of these measures is to provide additional useful information to investors and analysts and the measure does not have any standardized meaning under IFRS. Adjusted Gross Profit*, Adjusted EBITDA* and Adjusted Net Earnings*, Adjusted Net Earnings Per Share*, Net Debt* and Net Working Capital* should therefore not be considered in isolation or used as a substitute for measures of performance prepared in accordance with IFRS. For a reconciliation of Adjusted EBITDA* to EBITDA (earnings before finance expense, income taxes, depreciation and amortization) and of net earnings (loss) determined in accordance with IFRS to Adjusted EBITDA*, Adjusted Net Earnings* and Adjusted Net Earnings Per Share*, see the table on page 42 in the related management's discussion and analysis for the three months ended March 31, 2015.

SOURCE AGT Food and Ingredients Inc.

For further information: Investor Relations: Omer Al-Katib, (306) 244-1318, ir@agtfoods.com

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