Logistec announces 2015 year-end results

MONTRÉAL, March 22, 2016 /CNW Telbec/ - Logistec Corporation (TSX: LGT.A LGT.B), a marine and environmental services provider, today announced its financial results for the fourth quarter and the year ended December 31, 2015.

Consolidated revenue totalled $358.0 million in 2015, an increase of $35.8 million or 11.1% over 2014. Revenue was affected by the increase in the U.S. dollar against the Canadian dollar. For the year, the positive impact amounted to $15.3 million.

Activity in the marine services segment was similar to that of 2014, with a slight decrease in bulk activity, offset by an increase in break-bulk activity. The environmental services segment delivered a good performance in 2015, as revenue increased by $23.9 million or 18.7% over 2014 to reach $151.5 million. Revenue growth came primarily from increased activity in Aqua-Pipe and from site remediation.

In 2015, Logistec achieved a consolidated profit for the year of $32.9 million, of which $29.1 million was attributable to owners of the Company. This is lower than the 2014 consolidated profit of $34.5 million, of which $31.0 million was attributable to owners of the Company. This decline stemmed largely from additional cargo-handling costs due to flooding at our terminal in Virginia, a fire at our terminal in Georgia, and the start-up of our new container terminal in Montréal (QC). This was partially offset by greater profitability in our environmental services segment. The 2015 profit attributable to owners of the Company computes to total basic and diluted earnings per share of $2.34, which corresponds to $2.25 attributable to Class A Common Shares and $2.47 attributable to Class B Subordinate Voting Shares.This compares to total basic and diluted earnings per share of $2.46 in 2014, of which $2.37 was attributable to Class A Common Shares and $2.59 was attributable to Class B Subordinate Voting Shares.

During the fourth quarter of 2015, consolidated revenue totalled $92.4 million, up by $5.5 million over the same period of 2014. This increase is explained by strong activity in the marine services segment. The profit attributable to owners of the Company amounted to $7.9 million for total basic and diluted earnings per share of $0.63, of which $0.61 was attributable to Class A Common Shares and $0.67 was attributable to Class B Subordinate Voting Shares. For the same period of 2014, basic and diluted earnings per share totalled $0.58, of which $0.56 was attributable to Class A Common Shares and $0.61 was attributable to Class B Subordinate Voting Shares.

Outlook

"Our development plan is focused on strengthening and growing our footprint of cargo-handling services in North America. Over the last few years, we have succeeded in growing organically by targeting very specific growth markets, namely mining, biomass and port logistics.

Unfortunately, with the significant drop in commodity prices, the landscape for mining development has been negatively affected and we need to moderate our expectations for significant growth. However, we still believe there will be opportunities, particularly in Québec, and we will seize these opportunities as they arise.

In biomass, we are rebuilding the capacity damaged by the fire in Georgia. We have also completed an expansion that will be coming on stream in the next quarter for a different customer. That will allow for some volume expansion in 2016.

Our container business should also see some growth in 2016. Although the economic environment is very difficult, with GDP growth at very low levels, we should be able to strengthen our Canadian gateway with new U.S. cargoes while also extending our geographic reach through the hub-and-spoke model of our customer, Mediterranean Shipping Company, S.A. This allows them to competitively transload cargoes between North America and the world using the Montréal (QC) and Saint John (NB) gateways.

Our port logistics business in Montréal-Est (QC) is developing well. We were able to offer transloading services within our new warehouse via rail/container/truck for the first time in 2015, and our services were well received by our customers. We expect continued growth of this business in 2016. In Virginia, flooding severely affected our business in 2015 and we are looking to diversify our customer base and develop our services, based on the success and the growth of the Port of Virginia as an international container port in North America.

The difficult economic environment may also present acquisition opportunities and we are actively reaching out to companies that would fit well with our development plan. We are seeking to strengthen and expand our port network and to facilitate trade through market-driven cargo-handling opportunities in North America.

We are also committed to developing our environmental services segment. Sanexen should have another good year in 2016. The order book is strong and its two main markets, traditional environmental services and the rehabilitation of water mains, hold significant growth potential. In Canada, we are well positioned to capitalize on the aqueduct infrastructure projects that are at the heart of the government's strategy. In the USA, the recovery is tangible and underground infrastructure rehabilitation needs are enormous. Finally, after being established for four years in France, our activities are seeing sustained growth, particularly in regulated materials management.

Sanexen enjoys an enviable position in its main markets. To add to its service offering in 2016, we will open the first fully-enclosed contaminated soils bioremediation centre in Canada. In addition, as of March 8, 2016, the Company acquired a business for $5.6 million. This acquisition represents a vertical integration for the environmental services segment.

In our Aqua-Pipe business, we expect to advance our growth in the U.S. market. Furthermore, Ventia, our licensee in Australia, will be performing its first installations in 2016. The Australian market represents a good potential due to new regulations affecting water mains made of asbestos cement.

As is the case for our marine services business, we will continue to pursue growth opportunities, both internally and externally, in 2016," indicated Madeleine Paquin, President and Chief Executive Officer of Logistec Corporation.

"Overall, we are committed and confident that we can continue to build our business based on the specialized services where we have developed our expertise with a solid customer base. Despite the more difficult economic environment, our service offerings, our geographic diversity, and our ability to invest in growth opportunities should allow us to continue to increase our services in both the short and long term. Clearly, our success rests on the strength of our highly dynamic team of experts who are customer oriented and consistently bring value to an expanding customer base," concluded Madeleine Paquin.

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 some 30 ports and 40 terminals in eastern North America. Logistec also offers marine transportation services geared primarily to the Arctic coastal trade, short-line rail transportation services, and 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.

 

2015 Consolidated Financial Statements



Consolidated Statements of Earnings


years ended December 31
(in thousands of Canadian dollars, except for per share amounts)


2015

2014


$

$




Revenue

358,008

322,220




Employee benefits expense

(176,953)

(151,942)

Equipment and supplies expense

(91,000)

(86,021)

Rental expense

(29,062)

(26,820)

Other expenses

(14,673)

(11,507)

Depreciation and amortization expense

(12,328)

(10,246)

Share of profit of equity accounted investments

4,264

6,403

Other gains and losses

5,528

2,525

Operating profit

43,784

44,612




Finance expense

(936)

(693)

Finance income

313

468

Profit before income taxes

43,161

44,387




Income taxes

(10,288)

(9,870)

Profit for the year

32,873

34,517




Profit attributable to:






Owners of the Company

29,142

31,037




Non-controlling interests

3,731

3,480

Profit for the year

32,873

34,517




Basic and diluted earnings per Class A Common Share (1)

2.25

2.37

Basic and diluted earnings per Class B Subordinate Voting Share (2)

2.47

2.59

(1) 

Class A Common Share ("Class A share")

(2)

Class B Subordinate Voting Share ("Class B share")

 



Consolidated Statements of Comprehensive Income


years ended December 31
(in thousands of Canadian dollars)


2015

2014


$

$




Profit for the year

32,873

34,517




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

6,275

2,796



Losses on derivatives designated as cash flow hedges

(187)

(63)



Transfer of losses on derivatives designated as cash flow hedges to the consolidated statements of earnings

80

9



Income taxes relating to derivatives designated as cash flow hedges

31

17



Share of other comprehensive income of equity accounted investments, net of income taxes

(7)

14


Total items that are or may be reclassified to the consolidated statements of earnings

6,192

2,773





Items that will not be reclassified to the consolidated statements of earnings





Remeasurement losses on benefit obligation

(239)

(2,861)



Return on retirement plan assets excluding amounts included in profit for the year

(199)

1,430



Income taxes on remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the year

118

385



Share of other comprehensive income of equity accounted investments, net of income taxes

(6)

28


Total items that will not be reclassified to the consolidated statements of earnings

(326)

(1,018)




Other comprehensive income for the year, net of income taxes

5,866

1,755




Total comprehensive income for the year

38,739

36,272




Total comprehensive income attributable to:






Owners of the Company

35,008

32,792

Non-controlling interests

3,731

3,480

Total comprehensive income for the year

38,739

36,272

 


Consolidated Statements of Financial Position


(in thousands of Canadian dollars)


As at
December 31,
 2015

As at
December 31,
2014


$

$




Assets



Current assets




Cash and cash equivalents

23,811

26,381


Investment in a service contract

1,157

1,366


Trade and other receivables

77,333

67,052


Work in progress

6,438

1,027


Current income tax assets

2,569

2,638


Prepaid expenses

7,952

3,106


Inventories

6,553

4,585


125,813

106,155




Equity accounted investments

28,951

27,123

Property, plant and equipment

111,022

99,663

Goodwill

22,615

21,407

Other intangible assets

20,247

18,286

Other non-current assets

5,194

1,704

Post-employment benefit assets

522

768

Non-current financial assets

5,019

3,432

Deferred income tax assets

9,032

8,449

Total assets

328,415

286,987




Liabilities



Current liabilities




Trade and other payables

46,352

40,452


Deferred revenue

2,700

2,475


Current income tax liabilities

650

1,159


Dividends payable

967

815


Current portion of long-term debt

2,159

1,261


Provisions

1,268

1,001


54,096

47,163




Long-term debt

29,920

28,007

Provisions

766

644

Deferred income tax liabilities

12,433

9,380

Post-employment benefit obligations

12,955

12,453

Deferred revenue

4,533

4,933

Non-current financial liabilities

4,067

4,983

Total liabilities

118,770

107,563




Commitments, contingent liabilities and guarantees






Equity



Share capital

14,985

14,906

Retained earnings

164,154

144,513

Accumulated other comprehensive income

10,274

4,082

Equity attributable to owners of the Company

189,413

163,501




Non-controlling interests

20,232

15,923

Total equity

209,645

179,424




Total liabilities and equity

328,415

286,987

 

On behalf of the Board












(signed) David M. Mann


(signed) Madeleine Paquin



Director


Director

 


Consolidated Statements of Changes in Equity


(in thousands of Canadian dollars)


Attributable to owners of the Company




Accumulated other
comprehensive
i
ncome (loss)



Share
capital

Cash flow
hedges

Foreign
currency
translation

Retained
earnings

Total

Non-
controlling
interests

Total
equity


$

$

$

$

$

$

$









Balance as at January 1, 2015

14,906

(56)

4,138

144,513

163,501

15,923

179,424









Profit for the year

-

-

-

29,142

29,142

3,731

32,873









Other comprehensive income (loss)









Currency translation differences arising on translation of foreign operations

-

-

6,275

-

6,275

-

6,275


Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the year, net of income taxes

-

-

-

(320)

(320)

-

(320)


Cash flow hedges, net of income taxes

-

(76)

-

-

(76)

-

(76)


Share of other comprehensive income of equity accounted investments, net of income taxes

-

(7)

-

(6)

(13)

-

(13)

Total comprehensive income (loss) for the year

-

(83)

6,275

28,816

35,008

3,731

38,739









Repurchase of Class A shares

(16)

-

-

(974)

(990)

-

(990)

Issuance and repurchase of Class B shares

95

-

-

(4,641)

(4,546)

-

(4,546)

Investment received from a non-controlling interest

-

-

-

-

-

578

578

Dividends on Class A shares

-

-

-

(2,047)

(2,047)

-

(2,047)

Dividends on Class B shares

-

-

-

(1,513)

(1,513)

-

(1,513)

Balance as at December 31, 2015

14,985

(139)

10,413

164,154

189,413

20,232

209,645

















Balance as at January 1, 2014

15,030

(33)

1,342

135,552

151,891

11,791

163,682









Profit for the year

-

-

-

31,037

31,037

3,480

34,517









Other comprehensive income (loss)









Currency translation differences arising on translation of foreign operations

-

-

2,796

-

2,796

-

2,796


Remeasurement losses on benefit obligation and return on retirement plan assets excluding amounts included in profit for the year, net of income taxes

-

-

-

(1,046)

(1,046)

-

(1,046)


Cash flow hedges, net of income taxes

-

(37)

-

-

(37)

-

(37)


Share of other comprehensive income of equity accounted investments, net of income taxes

-

14

-

28

42

-

42

Total comprehensive income (loss) for the year

-

(23)

2,796

30,019

32,792

3,480

36,272









Repurchase of Class A shares

(8)

-

-

(425)

(433)

-

(433)

Issuance and repurchase of Class B shares

(116)

-

-

(7,602)

(7,718)

-

(7,718)

Non-controlling interest arising on a business acquisition

-

-

-

-

-

1,475

1,475

Repurchase of share capital by a subsidiary

-

-

-

(167)

(167)

(823)

(990)

Dividends on Class A shares

-

-

-

(7,314)

(7,314)

-

(7,314)

Dividends on Class B shares

-

-

-

(5,550)

(5,550)

-

(5,550)

Balance as at December 31, 2014

14,906

(56)

4,138

144,513

163,501

15,923

179,424

 


Consolidated Statements of Cash Flows


years ended December 31

(in thousands of Canadian dollars)


2015

2014


$

$




Operating activities




Profit for the year

32,873

34,517


Impairment loss related to assets destroyed

6,066


Gain on insurance recovery of assets

(6,066)


Items not affecting cash and cash equivalents

27,310

23,579


Cash generated from operations

60,183

58,096


Dividends received from equity accounted investments

2,434

5,646


Contributions to defined benefit retirement plans

(1,119)

(1,607)


Settlement of provisions

(126)

(45)


Changes in non-cash working capital items

(11,765)

2,182


Income taxes paid

(8,842)

(15,164)


40,765

49,108




Financing activities




Net change in short-term bank loans

-

(2,087)


Issuance of long-term debt, net of transaction costs

12,642

36,000


Repayment of long-term debt

(9,945)

(13,613)


Interest paid

(913)

(705)


Issuance of Class B shares

113

145


Repurchase of share capital by a subsidiary

-

(990)


Repurchase of Class A shares

(990)

(433)


Repurchase of Class B shares

(4,873)

(8,100)


Dividends paid on Class A shares

(1,956)

(7,240)


Dividends paid on Class B shares

(1,452)

(5,508)


(7,374)

(2,531)




Investing activities




Customer repayment of an investment in a service contract

209

231


Interest received

320

613


Cash acquired in business acquisitions

-

1,622


Business acquisitions

-

(5,752)


Investment in a joint venture

578

(100)


Acquisition of property, plant and equipment

(26,118)

(40,049)


Proceeds from disposal of property, plant and equipment

704

1,071


Acquisition of intangible assets

(56)

(211)


Repayment of non-current financial assets

-

3,288


Acquisition of other non-current assets

(10,640)

(298)


Disposal of other non-current assets

-

6


(35,003)

(39,579)




Net change in cash and cash equivalents

(1,612)

6,998

Cash and cash equivalents, beginning of year

26,381

19,638

Effect of exchange rate on balances held in foreign currencies of foreign operations

(958)

(255)

Cash and cash equivalents, end of year

23,811

26,381

 

 

SOURCE Logistec Corporation

For further information: Jean-Claude Dugas, CPA, CA, Vice-President, Finance, Logistec Corporation, jdugas@logistec.com, (514) 985-2345

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