ADF Group announces its results of the third quarter ended October 31, 2009
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Highlights:
- Net profit margin of 10.7% of revenues for the first nine months ended
October 31, 2009.
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") of 21% of revenues during the third quarter and for the
nine-month period ended October 31, 2009.
- Order backlog totalling $137 million as at October 31, 2009, compared
with $115 million at the same date last year, representing a 19%
increase.
- Liquidities (consisting of cash, cash equivalents and short-term
investments) of $16.8 million as at October 31, 2009, exceeding by
$9.7 million its long-term debt including the current portion.
- Appointment of Me Robert Paré to ADF Group's Board of Directors.
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TERREBONNE, QC,
Third-quarter EBITDA amounted to
ADF Group closed the third quarter with net earnings of
"At a time when we are witnessing an improvement in conditions in our principal markets, we are pleased to see that ADF Group weathered the worst of the economic recession while maintaining significant profitability, as reflected by a net profit margin of 10.7% of revenues for the first nine months", indicated
As at
Redemption of Subordinate Voting Shares in the Normal Course of Business
("NCIB")
During the third quarter ended
Outloook
"We look to the upcoming quarters with confidence. At as
He also said that ADF is progressing as scheduled in seeking the qualification to comply with the nuclear system requirements in effect in America by the end of current fiscal year. Moreover, during the fourth quarter, ADF will complete the
Appointment To The Corporation's Board Of Directors
About ADF
ADF Group Inc. is a North American leader in the design, engineering, fabrication and selective installation in the non-residential construction industry of complex steel structures, heavy built-ups, as well as in miscellaneous and architectural metals. ADF is one of the few players in the industry capable of handling highly technically complex mega projects on fast-track schedules in the commercial, institutional, industrial and public sectors.
Forward-Looking Information
This press release contains forward-looking statements reflecting ADF objectives and expectations. These statements are identified by the use of verbs such as "expect" as well as by the use of future or conditional tenses. By their very nature these types of statements involve risks and uncertainty. Consequently, reality may differ from ADF's expectations.
All amounts are in Canadian dollars.
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CONFERENCE CALL WITH INVESTORS:
TO DISCUSS ADF GROUP'S RESULTS
FOR THE THIRD QUARTER AND FIRST NINE MONTHS
ENDED OCTOBER 31, 2009
Thursday, December 10, 2009 at 10:00 am (Montreal time)
To participate in the conference call, please dial 1-888-231-8191.
To ensure you can participate, please dial a few minutes before the start
of call.
For those unable to participate, a taped rebroadcast will be
available from Thursday, December 10, 2009 at noon until 23:59
Thursday, December 17, 2009, by dialing 1-800-642-1687;
access code 44248228.
The conference call will be simultaneously webcast at www.adfgroup.com
and archived for 90 days.
Members of the media are invited to listen in.
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CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
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Three (3) Months Nine (9) Months
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Periods ended October 31, 2009 2008 2009 2008
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(In thousands of $, except
per-share amounts) $ $ $ $
Revenues 15,769 25,104 51,269 74,257
Cost of goods sold 11,837 17,809 37,367 52,904
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Gross margin 3,932 7,295 13,902 21,353
Selling and administrative
expenses 656 1,519 2,965 3,596
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Earnings before undernoted
items: 3,276 5,776 10,937 17,757
Amortization
Property, plant and
equipment 686 535 2,017 1,718
Intangible assets 84 15 238 41
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770 550 2,255 1,759
Gain on foreign exchange (120) (3,944) (1,446) (4,585)
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650 (3,394) 809 (2,826)
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Earnings before financial
charges and income taxes 2,626 9,170 10,128 20,583
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Financial charges
Interest on long-term
debt 43 130 153 369
Interest income (110) (81) (435) (213)
Other interest 19 29 19 101
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(48) 78 (263) 257
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Earnings before income
taxes 2,674 9,092 10,391 20,326
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Income taxes
Current 108 3 283 174
Future 1,186 2,571 4,643 6,350
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1,294 2,574 4,926 6,524
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Net earnings and
comprehensive income 1,380 6,518 5,465 13,802
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Basic earnings per share 0.04 0.18 0.15 0.38
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Diluted earnings per share 0.04 0.18 0.15 0.37
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Average number of
outstanding shares
(in thousands) 35,322 36,171 35,498 36,141
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Average number of
outstanding diluted
shares (in thousands) 36,187 37,097 36,323 37,267
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CONSOLIDATED STATEMENTS OF RETAINED EARNINGS (DEFICIT)
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Three (3) Months Nine (9) Months
-------- --------
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Periods ended October 31, 2009 2008 2009 2008
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(In thousands of $) $ $ $ $
Retained earnings (deficit),
beginning of the period 5,857 (68,254) 1,772 (75,538)
Net earnings 1,380 6,518 5,465 13,802
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Retained earnings (deficit),
end of the period 7,237 (61,736) 7,237 (61,736)
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CONSOLIDATED STATEMENTS OF CONTRIBUTED SURPLUS
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Three (3) Months Nine (9) Months
-------- --------
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Periods ended October 31, 2009 2008 2009 2008
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(In thousands of $) $ $ $ $
Contributed surplus,
beginning of the period 2,653 2,059 2,175 1,965
Stock-based compensation 89 62 216 173
Exercise of options and
warrants (5) - (29) (17)
Excess of the book value
over the acquisition cost
of redeemed subordinate
voting shares 415 - 790 -
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Contributed surplus, end
of the period 3,152 2,121 3,152 2,121
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CONSOLIDATED BALANCE SHEETS
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At At
October 31, January 31
2009 2009
(Audited)
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(In thousands of $) $ $
ASSETS
Current
Cash and cash equivalents 4,438 22,490
Short-term Investments 12,400 6,000
Accounts receivable 18,689 11,165
Holdbacks on contracts 3,294 3,462
Work in progress 1,282 628
Inventories 2,890 3,271
Prepaid expenses 622 660
Derivative financial instruments 1,781 -
Future income tax assets 6,854 6,666
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52,250 54,342
Holdbacks on long-term contracts 348 1,129
Property, plant and equipment 40,125 40,360
Intangible assets 2,727 2,402
Other assets 241 185
Future income tax assets 7,113 13,444
Investment tax credits 2,505 2,505
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105,309 114,367
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LIABILITIES
Current
Accounts payable 2,527 5,170
Accrued charges 1,802 4,716
Salaries and fringe benefits payable 2,070 3,762
Deferred revenues 4,326 4,767
Income taxes 89 226
Derivative financial instruments - 1,058
Current portion of long-term debt 2,450 3,018
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13,264 22,717
Long-term debt 4,726 6,827
Future income tax liabilities 492 47
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18,482 29,591
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Shareholders' equity
Retained earnings 7,237 1,772
Accumulated other comprehensive income 144 144
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7,381 1,916
Capital stock 76,294 80,685
Contributed surplus 3,152 2,175
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86,827 84,776
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105,309 114,367
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CONSOLIDATED STATEMENTS OF CASH FLOWS
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Three (3) Months Nine (9) Months
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Periods ended October 31, 2009 2008 2009 2008
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(In thousands of $) $ $ $ $
OPERATING ACTIVITIES
Net earnings 1,380 6,518 5,465 13,802
Adjustments for:
Amortization of property,
plant and equipment 686 535 2,017 1,718
Amortization of
intangible assets 84 15 238 41
Loss (gain) on disposal
of property, plant and
equipment - 1 - (974)
Unrealized loss (gain)
on derivative financial
instruments 689 970 (2,839) 970
Non-cash exchange loss
(gain) 2 (1,725) 1,178 (1,792)
Future income taxes 1,186 2,571 4,643 6,350
Interest capitalized on
interest-free long-term
debt 5 5 15 14
Stock-based compensation 89 62 216 173
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Net earnings adjusted 4,121 8,952 10,933 20,302
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Changes in non-cash
operating working capital
items
Accounts receivable (2,499) (2,733) (7,524) (7,701)
Short-term and long-
term holdbacks on
contracts 135 (849) 949 (1,942)
Work in progress 127 (2,119) (654) (1,617)
Inventories 335 (357) 381 (655)
Income taxes 109 33 (137) 57
Prepaid expenses 311 268 38 (377)
Accounts payable,
accrued charges,
salaries and fringe
benefits payable (2,331) 223 (7,249) 4,649
Deferred revenues (1,321) (326) (441) 2,420
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(5,134) (5,860) (14,637) (5,166)
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Cash flows from operating
activities (1,013) 3,092 (3,704) 15,136
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INVESTING ACTIVITIES
Acquisition of property,
plant and equipment (1,060) (830) (1,782) (8,306)
Acquisition of
intangible assets (98) (303) (563) (942)
Investment purchase - - (6,400) -
Decrease (increase) in
other items (60) 7 (56) 6
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Cash flows applied to
investing activities (1,218) (1,126) (8,801) (9,242)
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FINANCING ACTIVITIES
Redemption of shares (2,234) - (3,687) -
Repayment of long-term
debt (217) (607) (1,684) (1,620)
Issuance of subordinate
voting shares 10 2 57 49
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Cash flows applied to
financing activities (2,441) (605) (5,314) (1,571)
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Impact of fluctuations
in foreign exchange rate
on cash 7 245 (233) 149
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Net cash (outflows)
inflows (4,665) 1,606 (18,052) 4,472
Cash and cash equivalents,
beginning of the period 9,103 10,552 22,490 7,686
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Cash and cash equivalents,
end of the period(1) 4,438 12,158 4,438 12,158
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Supplemental cash flow
information
Income taxes paid 2 - 206 162
Interest paid (received) 6 58 (107) 262
Non-cash financing and
investing activities:
Property, plant and
equipment given in
exchange for new
equipment - - - 2,261
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(1) At October 31, 2009, cash and cash equivalents were composed of
$4,416,000 in cash and $22,000 in cash equivalents ($4,398,000 in
cash and $7,760,000 in cash equivalents as at October 31, 2008.)
SEGMENTED INFORMATION
The Corporation operates in the non-residential construction sector, primarily in
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Three (3) Months Nine (9) Months
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Periods ended October 31, 2009 2008 2009 2008
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$ $ $ $
Revenues
- Canada 1,413 2,506 9,106 5,560
- United States 14,356 22,598 42,163 68,697
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15,769 25,104 51,269 74,257
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As at As at
October 31, January 31,
2009 2009
(Audited)
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$ $
Property, Plant and Equipment
- Canada 39,945 40,148
- United States 180 212
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40,125 40,360
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During the first nine months ended
For further information: Jean Paschini, Chairman of the Board and Chief Executive Officer, (450) 965-1911, 1-800-263-7560; Louis Potvin, Chief Financial Officer; (450) 965-1911, 1-800-263-7560; www.adfgroup.com; Media: Caroline Couillard, Morin Relations Publiques, (514) 289-8688, ext. 233; Source: ADF Group Inc.
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