TERRAVEST ANNOUNCES FOURTH QUARTER AND YEAR END RESULTS FOR FISCAL 2025 AND A 14% DIVIDEND INCREASE

TORONTO, Dec. 11, 2025 /CNW/ - TerraVest Industries Inc., (TSX: TVK) ("TerraVest" or the "Company") announces its results for the fourth quarter and year ended September 30, 2025 and the declaration of its quarterly dividend.

FOURTH QUARTER AND YEAR END REVIEW AND OUTLOOK

Business Performance

Management believes that there are certain non‐IFRS financial measures that can be used to assist shareholders in analyzing the performance of TerraVest. The table below highlights certain financial results and reconciles net income to Adjusted earnings before interests, income taxes, depreciation and amortization ("Adjusted EBITDA") for the fourth quarter and year ended September 30, 2025 and the comparative periods in fiscal 2024.

		Fourth quarters ended			Years ended
		Sept. 30, 2025	Sept. 30, 2024		Sept. 30, 2025	Sept. 30, 2024
		$	$		$	$
	Sales	419,409	230,654		1,371,151	911,816
	Net Income	21,277	13,825		98,363	73,244
	Add (subtract):
	Income tax expense	6,030	4,814		23,575	23,488
	Financing costs	16,651	5,525		49,785	25,138
	Depreciation and amortization	49,514	21,271		121,500	69,347
	Change in fair value of derivative     financial instruments	(148)	253		326	631
	Change in fair value of investment in     equity instruments	4,298	(641)		(10,598)	(615)
	Change in fair value of investment in a     limited partnership	1,367	1,067		1,177	1,425
	Change in fair value of contingent    considerations	(8,300)	-		(8,300)	-
	(Gain) loss on foreign exchange	(3,959)	2,125		(4,968)	453
	(Gain) loss on disposal of other property, plant     and equipment	(135)	(505)		(252)	(2,958)
	(Gain) loss on disposal of property, plant and     equipment for rental	-	(377)		(452)	(1,199)
	(Gain) loss on lease modification	(9)	-		(9)	-
	(Gain) loss on sale of business	(256)	-		(392)	(444)
	Gain on bargain purchase	(4,687)	-		(8,680)	-
	Acquisition‑related cost	259	190		3,512	1,089
	Adjusted EBITDA	81,902	47,547		264,587	189,599

Sales for the fourth quarter and year ended September 30, 2025 were $419,409 and $1,371,151 versus $230,654 and $911,816 for the prior comparable periods. This represents increases of 82% and 50% respectively. However, TerraVest acquired all the issued and outstanding shares of Tankcon FRP Inc. ("Tankcon") in May 2025, of Simplex, Inc. ("Simplex") and L.B.T., Inc. ("LBT") in April 2025, of EnTrans Holding, Inc. ("Entrans") in March 2025 and of Advance Engineered Products Ltd. ("Advance") in April 2024. In addition, TerraVest acquired all the Canadian assets of New Wave Energy Services Ltd. ("Wave") in September 2025 and of Aureus Energy Services Inc. ("Aureus") in January 2025 and all the operating assets of the subsidiaries of Highland Tank Holdings LLC ("Highland") in November 2023, of which only Highland and Advance partially contributed to the prior comparable twelve-month period. Excluding Tankcon, Simplex, LBT and Entrans, sales for the fourth quarter ended September 30, 2025 were $246,912 versus $230,654 for the prior comparable period and excluding the same acquisitions plus Highland and Advance, sales for the year ended September 30, 2025 were $725,592 versus $717,402 for the prior comparable period.

This represents increases of 7% and 1% respectively for TerraVest's base portfolio (excluding Tankcon, Simplex, LBT, Entrans, Advance and Highland). Wave and Aureus results can't be excluded from TerraVest results as Wave and Aureus activities have been fully integrated into one of TerraVest's existing subsidiaries whose operations are similar in nature.

The increases in sales for TerraVest base portfolio businesses versus prior comparable periods are a result of higher demand in the Service and the HVAC and Containment Equipment segments and for domestic compressed gas tanks, partially offset by softer demand for storage tanks, for certain compressed gas transportation equipment product lines and for energy processing equipment.

Net income for the fourth quarter and year ended September 30, 2025 were $21,277 and $98,363 versus $13,825 and $73,244 for the prior comparable periods. This represents increases of 54% and 34% respectively. The addition of Entrans, LBT, Tankcon, Simplex, Aureus, Advance and Highland positively contributed to net income for the fourth quarter and year ended September 30, 2025, as well as increased revenues for some of TerraVest's base portfolio businesses, a favorable change in fair value of contingent considerations and a gain on foreign exchange and on bargain purchase. These increases were partially offset by additional depreciation and amortization expenses and financing costs as a result of business acquisitions and an unfavorable change in fair value of investment in equity instruments (favorable change for the year ended September 30, 2025). TerraVest also incurred additional acquisition-related costs as well as additional expenses to develop a new product line versus the prior comparable periods. Other variances are also highlighted in the table above.

Adjusted EBITDA for the fourth quarter and year ended September 30, 2025 were $81,902 and $264,587 versus $47,547 and $189,599 for the prior comparable periods. This represents increases of 72% and 40% respectively, which is the result of the reasons explained above.

The table below reconciles cash flow from operating activities to Cash Available for Distribution for the fourth quarter and year ended September 30, 2025 and the comparative periods in fiscal 2024.

		Fourth quarters ended			Years ended
		Sept. 30, 2025	Sept. 30, 2024		Sept. 30, 2025	Sept. 30, 2024
		$	$		$	$
	Cash Flow from Operating Activities	12,285	29,456		111,070	156,478
	Add (subtract):
	Change in non‑cash operating working     capital items	41,778	6,659		62,518	(17,644)
	Maintenance capital expenditures	(6,875)	(7,034)		(26,847)	(26,137)
	Repayment of lease liabilities	(3,692)	(2,816)		(12,505)	(8,336)
	Cash Available for Distribution	43,496	26,265		134,236	104,361
	Dividends Paid	3,795	2,925		13,546	10,604
	Dividend Payout Ratio	9 %	11 %		10 %	10 %

Cash flow from operating activities for the fourth quarter and year ended September 30, 2025 were $12,285 and $111,070 versus $29,456 and $156,478 for the prior comparable periods. This represents decreases of 58% and 29% respectively. The decreases are attributable to additional interest and income taxes paid and an unfavorable change in working capital items, primarily inventory levels, customer deposits and accounts receivables, partially offset by increased net income.

Maintenance Capital Expenditures were $6,875 for the fourth quarter ended September 30, 2025 versus $7,034 for the prior comparable period representing a decrease of 2%, which is primarily explained by the timing of such capital expenditures and the nature of the capital projects in progress. During the fourth quarter ended September 30, 2025, TerraVest's total purchase of property, plant and equipment ("PP&E") paid was $20,717 of which $13,842 is considered growth capital. The growth capital incurred during the fourth quarter was mainly used to invest in new manufacturing product lines and increase its asset base in one of its service businesses.

Cash Available for Distribution for the fourth quarter and year ended September 30, 2025 increased by 66% and 29% respectively versus the prior comparable periods. These increases are a result of reasons explained above and elsewhere in this press release.

Outlook

In general, TerraVest's portfolio of businesses is performing well. Recent acquisitions have made a meaningful contribution and we expect this to continue throughout the next fiscal year. Opportunities to enhance performance through synergies between recent acquisitions and the base portfolio of businesses continue to exist and are a focus for management.

Recent tariff announcements have created an environment of uncertainty in North America's manufacturing sector. This uncertainty has resulted in softer demand recently for a few of TerraVest's businesses. However, TerraVest's portfolio businesses are well-positioned manufacturing products predominantly for their domestic markets, which greatly limits the impacts of any potential tariffs.

The Company continues to make targeted investments to improve its manufacturing efficiency and expand its product lines, particularly in end-markets where it has a meaningful presence. With the new credit facility obtained in March 2025, TerraVest is very well-positioned to pursue its acquisition strategy.

Business Combinations

In September 2025, TerraVest's partially owned subsidiary, Green Energy Services Inc. ("GES"), entered into an acquisition agreement to acquire all the Canadian assets and rights of Wave. Wave provides integrated water solutions, including in field water management, water treatment, water storage and long-distance transfer in Canada.

In May 2025, subsidiaries of TerraVest entered into an agreement to purchase all the issued and outstanding shares of Tankcon FRP Inc. as well as certain assets from affiliated entities, Tankcon Leasing Inc. and 9271-7743 Québec Inc. (altogether referred to as "Tankcon"). Headquartered in Blainville Québec, Tankcon is a premier North American manufacturer of fiber reinforced polymer ("FRP") tank trailers and lessor of such trailers.

In April 2025, a subsidiary of TerraVest entered into an agreement to purchase all the issued and outstanding shares of Simplex. Headquartered in Springfield Illinois, Simplex is a leading technology company that designs and manufactures electrical test systems (load banks) and fuel supply systems for the standby power generation industry.

In April 2025, a subsidiary of TerraVest entered into an agreement to purchase all the issued and outstanding shares of LBT. Headquartered in Omaha Nebraska, LBT is a premier North American manufacturer of tank trailers.

In March 2025, a subsidiary of TerraVest entered into an agreement to acquire all the issued and outstanding shares of Entrans. Headquartered in Athens Tennessee, Entrans is a premier North American manufacturer of tank trailers and transportation solutions.

In January 2025, TerraVest's partially owned subsidiary, GES, entered into an acquisition agreement to acquire all the Canadian assets of Aureus. Aureus provides water management heating activities and hot oiling services to the Western Canadian energy industry. The hot oiling services business was sold during the second quarter of fiscal 2025.

CONSOLIDATED RESULTS OF OPERATIONS

The following section provides the financial results of TerraVest's operations for the fourth quarter and year ended September 30, 2025 and the comparative periods in fiscal 2024.

		Fourth quarters ended			Years ended
		Sept. 30, 2025	Sept. 30, 2024		Sept. 30, 2025	Sept. 30, 2024
		$	$		$	$
	Sales	419,409	230,654		1,371,151	911,816
	Cost of sales	305,006	164,861		989,866	648,450
	Gross profit	114,403	65,793		381,285	263,366
	Administration expenses	69,171	31,846		198,111	113,365
	Selling expenses	13,011	7,820		43,503	30,820
	Financing costs	16,651	5,525		49,785	25,138
	Other (gains) losses	(11,737)	1,963		(32,052)	(2,689)
		87,096	47,154		259,347	166,634
	Earnings before income taxes	27,307	18,639		121,938	96,732
	Income tax expense	6,030	4,814		23,575	23,488
	Net Income	21,277	13,825		98,363	73,244
	Allocated to non‐controlling interests	2,798	1,914		11,712	9,673
	Net income attributable to common    shareholders	18,479	11,911		86,651	63,571
	Weighted average shares outstanding – Basic	21,685,695	19,501,433		20,281,344	18,630,378
	Weighted average shares outstanding – Diluted	22,185,285	20,189,879		20,969,439	19,324,764
	Net income per share – Basic	$0.85	$0.61		$4.27	$3.41
	Net income per share – Diluted	$0.83	$0.59		$4.13	$3.29

Sales for the fourth quarter and year ended September 30, 2025 increased by 82% and 50% respectively versus the prior comparable periods. The reasons have been explained previously in this press release.

Gross profit for the fourth quarter and year ended September 30, 2025 increased by 74% and 45% respectively versus the prior comparable periods. This is primarily explained by the contribution of Tankcon, Simplex, LBT, Aureus and Entrans for the fourth quarter and year ended September 30, 2025 and of Advance and Highland for the year ended September 30, 2025. A less favorable product mix and reduced activity levels in some of TerraVest's base portfolio businesses partially offset the increases in gross profits versus prior comparable periods.

Administration expenses for the fourth quarter and year ended September 30, 2025 increased by 117% and 75% respectively versus the prior comparable periods. The increases in administration expenses are mainly due to the addition of Tankcon, Entrans, LBT, Simplex, Advance and Highland (the latter two are only for the twelve-month period) and to additional business acquisition-related costs versus the prior comparable periods. TerraVest also incurred additional amortization of intangible assets expense as a result of the numerous business acquisitions completed in the current and prior fiscal year.

Selling expenses for the fourth quarter and year ended September 30, 2025 increased by 66% and 41% respectively versus the prior comparable periods. The increases in selling expenses are explained by the addition of LBT, Entrans, Simplex, Advance and Highland (the latter two are only for the twelve-month period) and by increased commission expenses as a result of increased sales in certain product lines.

Financing costs for the fourth quarter and year ended September 30, 2025 increased by 201% and 98% respectively versus the prior comparable periods. The increases are primarily explained by additional interest expense on long-term debt as a result of increased debt level following the acquisition of Entrans, LBT, Simplex and Tankcon and by additional interest on lease liabilities because of additional lease liabilities compared to the prior periods. The amortization of financing costs also increased versus the prior comparable periods following the amendment of the credit facilities in March 2025. The variation for the year ended September 30, 2025 is also explained by a fee incurred for the early repayment of an outstanding term loan refinanced as part of the amendment of the revolving operating credit facility.

Other (gains) losses variance for the fourth quarter and year ended September 30, 2025 reflect a gain on foreign exchange, a favorable change in fair value of investment in equity instruments and of contingent considerations and a gain on bargain purchase on the acquisition of Wave, LBT and Aureus (the latter only for year ended September 30, 2025). The variation is also explained by a non recurring gain on disposal of a building in the second quarter of fiscal 2024.

Income tax expense variance for the fourth quarter and year ended September 30, 2025 is the result of the variation in taxable earnings and the timing of income tax expense adjustments.

As a result of the above, net income attributable to common shareholders for the fourth quarter and year ended September 30, 2025 increased by 55% and 36% respectively versus the prior comparable periods.

DIVIDENDS

TerraVest is pleased to announce that The Board of Directors has declared a quarterly dividend of $0.20 per common share payable on January 9, 2026 to shareholders of record as at the close of business on December 31, 2025. This represents a 14% increase over the prior quarterly dividend. The dividend is designated an "eligible dividend" for Canadian income tax purposes.

Additional information can be found in TerraVest's annual consolidated financial statements and MD&A which are available on SEDAR+ at www.sedarplus.ca.

Non‑IFRS Financial Measures

This news release makes reference to certain non‑IFRS financial measures. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. TerraVest's definitions may differ from those of other issuers and therefore may not be comparable to similarly titled measures used by other issuers. The Company uses non‑IFRS financial measures including adjusted EBITDA, cash available for distribution, dividend payout ratio and maintenance capital expenditures.

Adjusted EBITDA: is defined as net income adjusted for income tax expense, financing costs, depreciation, amortization, change in fair value of derivative financial instruments, change in fair value of investment in equity instruments and investment in a limited partnership, change in fair value of contingent considerations, gains or losses on foreign exchange, gains or losses on disposal of other property, plant and equipment and property, plant and equipment for rental, gains or losses on disposal of intangible assets, gains or losses on lease modification, gains or losses on remeasurement of equity interest, gain on bargain purchase, gains or losses on sale of business, non recurring acquisition related costs, impairment charges and other non recurring and/or non operations related items that do not reflect the current ongoing operations of TerraVest. Management believes this is a useful metric in evaluating the ongoing operating performance of TerraVest. Readers are cautioned that Adjusted EBITDA should not be construed as an alternative to net income determined in accordance with IFRS as an indicator of TerraVest's performance.

Cash Available for Distribution: is defined as cash flow from operating activities adjusted for changes in non-cash operating working capital, maintenance capital expenditures and repayment of lease liabilities. Management believes that Cash Available for Distribution, as a liquidity measure, is a useful metric that provides an indication of the cash available from ongoing operations that can be distributed to shareholders as a dividend. Readers are cautioned that Cash Available for Distribution should not be construed as an alternative to cash flow from operating activities determined in accordance with IFRS as an indicator of TerraVest's liquidity and cash flows.

Dividend Payout Ratio: is defined as dividends paid in cash during the period divided by Cash Available for Distribution for the period. Management believes that Dividend Payout Ratio is a useful metric as it provides an indication of TerraVest's ability to sustain its current dividend policy. There is no directly comparable IFRS measure for Dividend Payout Ratio.

Maintenance Capital Expenditures: is defined as Capital Expenditures made to sustain the operations of TerraVest's operating businesses and to maintain the productive capacity of the businesses over an economic cycle, whether or not they yield significant cost or production efficiencies. Management believes that Maintenance Capital Expenditures should be funded by cash flow from existing operating activities and, therefore, deducted in determining Cash Available for Distribution. There is no directly comparable IFRS measure for Maintenance Capital Expenditures.

Working Capital: is calculated by subtracting current liabilities from current assets. Management uses Working Capital as a measure for assessing overall liquidity. There is no directly comparable IFRS measure for Working Capital.

Caution Regarding Forward-Looking Statements

This news release contains forward-looking statements. All statements other than statements of historical fact contained in this news release are forward-looking statements, including, without limitation, statements regarding our strategic direction and evaluation of the business segments and TerraVest as a whole, and other plans and objectives of or involving TerraVest. Readers can identify many of these statements by looking for words such as "expects" and "will" or similar terms or variations of these words. Although management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct.

By their nature, forward-looking statements require us to make assumptions and, accordingly, forward looking statements are subject to inherent risks and uncertainties. There is significant risk that the forward-looking statements will not prove to be accurate. We caution readers of this news release not to place undue reliance on our forward-looking statements because a number of factors may cause actual future circumstances, results, conditions, actions or events to differ materially from the plans, expectations, estimates or intentions expressed in the forward-looking statements and the assumptions underlying the forward-looking statements. 

Assumptions and analysis about the performance of TerraVest as a whole and its business segments, the markets in which the business segments compete and the prospects and values of the business segments are considered in setting the business plan for TerraVest, plans and/or ability to pay dividends, outlook for operations, financial position, results and cash flows, other plans and objectives and in making related forward-looking statements. Such assumptions include, without limitation, demand for products and services of the business segments in respect of the Canadian and other markets in which the businesses are active will be stable, and that input costs to business segments do not vary significantly from levels experienced historically. Should any of these factors or assumptions vary, actual results may differ materially from the forward-looking statements.

SOURCE TerraVest Industries Inc.

FOR FURTHER INFORMATION PLEASE CONTACT: Dustin Haw, TerraVest Industries Inc., Chief Executive Officer, [email protected]