Logistec Announces Financial Results for the Fourth Quarter and Year 2012

Marketwired

MONTREAL, QUEBEC--(Marketwire - Mar 21, 2013) - Logistec Corporation (TSX:LGT.A)(TSX:LGT.B), a marine and environmental services provider, today announced its financial results for the fourth quarter and the year ended December 31, 2012.

Consolidated revenue totalled $250.9 million in 2012, an increase of $26.2 million or 11.7% over 2011. The marine services segment posted revenue of $143.2 million in 2012, a higher level of activity when compared to the $132.9 million reported for 2011. Higher volumes of bulk cargo and increased activity in the USA, following the acquisition of CrossGlobe Transport, Ltd., contributed to this revenue growth. The environmental services segment delivered a very strong performance in 2012, as revenue increased by $15.9 million or 17.3% over 2011 to reach $107.6 million. The growth derives from a high overall level of activity, more specifically revenue from Niedner woven hoses and Aqua-Pipe® services.

In 2012, Logistec achieved a consolidated profit attributable to owners of the Company of $16.1 million compared to $17.6 million in 2011. The 2012 profit attributable to owners of the Company computes to total basic and diluted earnings per share of $2.47, which corresponds to basic and diluted earnings per share of $2.37 attributable to Class Common A shares and of $2.61 attributable to Class B Subordinate Voting shares. Although consolidated profit attributable to owners of the Company decreased from $17.6 million to $16.1 million, the 2011 figures included two non-operating items, which had a net after tax positive impact of $5.3 million. These included a gain on partial disposal of an investment, partly offset by an impairment loss on goodwill. If these items are excluded, profit increased by some $4 million or 31% in 2012. The marine services segment posted a profit before income taxes of $13.7 million, down by $0.6 million over $14.3 million in 2011. The environmental services segment recorded a profit before income taxes of $10.5 million, up by $1.3 million over $9.2 million in 2011.

During the fourth quarter of 2012, consolidated revenue totalled $67.7 million in the fourth quarter of 2012, up by $1.5 million over the same period of 2011. This increase can be explained by strong activity in the marine services segment in the fourth quarter, although it was partly offset by slower business in our environmental services segment. The consolidated profit attributable to owners of the Company amounted to $6.6 million, up by $3.6 million from the fourth quarter of 2011. The positive variation came from the impairment loss on goodwill and higher equipment costs incurred in the fourth quarter of 2011 combined with the strong activity in the marine services segment in the fourth quarter of 2012. The profit attributable to owners of the Company computes to total basic and diluted earnings per share of $1.04, which corresponds to basic and diluted earnings per share of $0.98 attributable to Class A Common Shares and of $1.07 attributable to Class B Subordinate Voting Shares.

Outlook

"We are optimistic we will be able to further develop our cargo-handling activities in 2013. In the USA, we are seeing some improvement in the building sector of the economy and this should bode well for construction materials, namely lumber and metals. We will further advance our development initiatives in the area of biomass and mining. To that effect, significant capital expenditures have been made to upgrade and specialize a portion of our Brunswick (GA) facility to handle biomass, namely wood pellets and woodchips. Customers have committed volumes to our facility and we feel strongly that the export market is growing quickly. With respect to mining, we are closely following the development of the mining sector in the Province of Québec and the Arctic and, with our cargo-handling and transportation businesses, we are well positioned to serve this developing customer base. Although there has been a slowdown based on weaker growth in China and lower-priced commodities, the sector continues to develop selectively.

We are also optimistic about our environmental services segment. In 2013, we intend to build on our Aqua-Pipe® technology and grow our services both in Québec, where we install our structural lining, and outside of the Province, where we work through a select group of licensees. Although municipalities are somewhat financially constrained, there remains a huge need to repair underground drinking water pipes in North America. It has been shown that 40% of North America''s drinking water is lost through existing infrastructure and this statistic is getting worse every year. Traditional methods of excavation and rebuilding are far costlier repair methods and our technology thus bodes well for the future. Our site remediation services are also promising given the continued desire to clean up the environment. We have built a strong team of experts who can find solutions for virtually all types of environmental contaminants and are expanding our services geographically, with the Arctic and France showing new revenue in the last few years. Finally, our woven-hose manufacturing business, which was purchased to secure the growing needs of our aqueduct rehabilitation services, continues to diversify its customer base. In 2013, it successfully launched a new product for the shale gas industry, a market which is expected to undergo strong growth in the coming years," indicated Madeleine Paquin, President and Chief Executive Officer of Logistec Corporation.

"All in all, we are confident we will continue to develop both our marine and environmental services segments, on the strength of our highly dynamic team of experts who are customer-oriented and consistently bring value to a growing customer base," concluded Ms. 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 24 ports in Eastern Canada, the Great Lakes and the U.S. East Coast. Logistec also offers marine transportation services geared primarily to the Arctic coastal trade, short-line rail transportation services, as well as 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, PCB 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 at 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.

Consolidated Statements of Earnings
years ended December 31
(in thousands of Canadian dollars, except for per share amounts)
 
  2012   2011  
  $   $  
         
Revenue 250,860   224,630  
         
Employee benefits expense (120,317 ) (109,399 )
Equipment and supplies expense (69,792 ) (60,915 )
Rental expense (22,891 ) (20,247 )
Other expenses (10,467 ) (12,054 )
Depreciation and amortization expense (7,819 ) (8,220 )
Share of profit of equity accounted investments 5,224   5,582  
Share of gain on partial disposal of an investment -   6,171  
Impairment loss on goodwill -   (1,300 )
Other gains and losses (241 ) (287 )
Operating profit 24,557   23,961  
         
Finance expense (808 ) (958 )
Finance income 461   558  
Profit before income taxes 24,210   23,561  
         
Income taxes (5,925 ) (3,993 )
Profit for the year 18,285   19,568  
         
Profit attributable to:        
         
Owners of the Company 16,061   17,592  
         
Non-controlling interests 2,224   1,976  
Profit for the year 18,285   19,568  
         
Basic and diluted earnings per Class A Common Share (1) 2.37   2.58  
Basic and diluted earnings per Class B Subordinate Voting Share (2) 2.61   2.84  
(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)
 
  2012   2011  
  $   $  
         
Profit for the year 18,285   19,568  
         
Other comprehensive income        
  Currency translation differences arising on translation of foreign operations (200 ) 114  
  Actuarial losses on retirement benefits (2,159 ) (5,611 )
  Income taxes on actuarial losses on retirement benefits 581   1,483  
  Gains (losses) on derivatives designated as cash flow hedges 40   (71 )
  Transfer of losses on derivatives designated as cash flow hedges to the consolidated statements of earnings 19   -  
  Income taxes relating to derivatives designated as cash flow hedges (16 ) 19  
  Share of other comprehensive income of equity accounted investments        
    Actuarial losses on retirement benefits (176 ) (272 )
    Income taxes on actuarial losses on retirement benefits 48   73  
    Gains on derivatives designated as cash flow hedges -   205  
    Transfer of gains on derivatives designated as cash flow hedges to non-financial assets -   (14 )
    Transfer of gains on derivatives designated as cash flow hedges to profit or loss on partial disposal of an investment -   (191 )
Other comprehensive income for the year, net of income taxes (1,863 ) (4,265 )
         
Total comprehensive income for the year 16,422   15,303  
         
Total comprehensive income attributable to:        
         
Owners of the Company 14,198   13,327  
Non-controlling interests 2,224   1,976  
Total comprehensive income for the year 16,422   15,303  
         
         
         
Consolidated Statements of Financial Position
(in thousands of Canadian dollars)  
  As at
December 31,
 2012
  As at
December 31,
2011
 
  $   $  
         
Assets        
Current assets        
  Cash and cash equivalents 7,519   8,888  
  Investments in service contracts 8,107   13,065  
  Trade and other receivables 55,795   45,007  
  Current income tax assets 1,915   2,559  
  Prepaid expenses 3,275   2,854  
  Inventories 4,492   3,922  
  81,103   76,295  
         
Equity accounted investments 31,019   32,726  
Property, plant and equipment 55,434   47,730  
Goodwill 14,847   10,686  
Other intangible assets 18,594   1,934  
Other non-current assets 2,097   1,927  
Post-employment benefit assets 441   779  
Non-current financial assets 5,255   5,265  
Deferred income tax assets 7,878   7,773  
Total assets 216,668   185,115  
         
Liabilities        
Current liabilities        
  Short-term bank loans 2,200   -  
  Trade and other payables 28,391   27,020  
  Deferred revenue 1,589   819  
  Current income tax liabilities 562   1,907  
  Dividends payable 607   594  
  Current portion of long-term debt 2,179   2,499  
  Provisions 763   488  
  36,291   33,327  
         
Long-term debt 19,808   11,873  
Provisions 286   148  
Deferred income tax liabilities 9,435   3,440  
Post-employment benefit obligations 13,146   11,475  
Non-current financial liabilities 2,381   2,624  
Total liabilities 81,347   62,887  
         
Commitments, contingent liabilities and guarantees        
         
Equity        
Share capital 15,139   15,149  
         
Retained earnings 112,032   100,996  
Accumulated other comprehensive loss (462 ) (305 )
Equity attributable to owners of the Company 126,709   115,840  
         
Non-controlling interests 8,612   6,388  
Total equity 135,321   122,228  
         
Total liabilities and equity 216,668   185,115  
 
 
 
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 income (loss)                
  Share capital   Cash flow hedges   Foreign currency translation   Retained earnings   Total   Non-controlling interests Total equity  
  $   $   $   $   $   $ $  
                           
Balance as at January 1, 2012 15,149   (52 ) (253 ) 100,996   115,840   6,388 122,228  
                           
Profit for the year -   -   -   16,061   16,061   2,224 18,285  
                           
Other comprehensive income                          
  Currency translation differences arising on translation of foreign operations -   -   (200 ) -   (200 ) - (200 )
  Actuarial losses on retirement benefits, net of income taxes -   -   -   (1,578 ) (1,578 ) - (1,578 )
  Cash flow hedges, net of income taxes -   43   -   -   43   - 43  
  Share of other comprehensive income of equity accounted investments, net of income taxes -   -   -   (128 ) (128 ) - (128 )
Total comprehensive income for the year -   43   (200 ) 14,355   14,198   2,224 16,422  
                           
Repurchase of Class A shares (7 ) -   -   (121 ) (128 ) - (128 )
Issuance and repurchase of Class B shares (3 ) -   -   (794 ) (797 ) - (797 )
Dividends on Class A shares -   -   -   (1,332 ) (1,332 ) - (1,332 )
Dividends on Class B shares -   -   -   (1,072 ) (1,072 ) - (1,072 )
Balance as at December 31, 2012 15,139   (9 ) (453 ) 112,032   126,709   8,612 135,321  
   

 

     
     
(in thousands of Canadian dollars)    
  Attributable to owners of the Company          
      Accumulated other comprehensive income (loss)                
  Share capital   Cash flow hedges   Foreign currency translation   Retained earnings   Total   Non-controlling interests Total equity  
  $   $   $   $   $   $ $  
                           
Balance as at January 1, 2011 15,130   -   (367 ) 90,702   105,465   4,392 109,857  
                           
Profit for the year -   -   -   17,592   17,592   1,976 19,568  
                           
Other comprehensive income                          
  Currency translation differences arising on translation of foreign operations -   -   114   -   114   - 114  
  Actuarial losses on retirement benefits, net of income taxes -   -   -   (4,128 ) (4,128 ) - (4,128 )
  Cash flow hedges, net of income taxes -   (52 ) -   -   (52 ) - (52 )
  Share of other comprehensive income of equity accounted investments, net of income taxes -   -   -   (199 ) (199 ) - (199 )
Total comprehensive income for the year -   (52 ) 114   13,265   13,327   1,976 15,303  
                           
Repurchase and conversion of Class A shares (16 ) -   -   (117 ) (133 ) - (133 )
Issuance of share capital by a subsidiary -   -   -   -   -   20 20  
Issuance, repurchase and conversion of Class B shares 35   -   -   (504 ) (469 ) - (469 )
Dividends on Class A shares -   -   -   (1,299 ) (1,299 ) - (1,299 )
Dividends on Class B shares -   -   -   (1,051 ) (1,051 ) - (1,051 )
Balance as at December 31, 2011 15,149   (52 ) (253 ) 100,996   115,840   6,388 122,228  
                           
                           
                           
Consolidated Statements of Cash Flows
years ended December 31
(in thousands of Canadian dollars)
 
  2012   2011  
  $   $  
         
Operating activities        
  Profit for the year 18,285   19,568  
  Items not affecting cash and cash equivalents 11,787   6,184  
  Cash generated from operations 30,072   25,752  
  Dividends received from equity accounted investments 7,229   3,878  
  Contributions to defined benefit retirement plans (1,314 ) (1,103 )
  Settlement of provisions (1,403 ) (472 )
  Changes in non-cash working capital items (12,797 ) (7,508 )
  Income taxes paid (6,296 ) (7,312 )
  15,491   13,235  
         
Financing activities        
  Net change in short-term bank loans 2,200   (2,278 )
  Issuance of long-term debt, net of transaction costs 16,150   -  
  Repayment of long-term debt (8,547 ) (3,882 )
  Interest paid (805 ) (1,049 )
  Issuance of Class B shares 6   4  
  Issuance of share capital by a subsidiary -   20  
  Repurchase of Class A shares (128 ) (125 )
  Repurchase of Class B shares (956 ) (613 )
  Dividends paid on Class A shares (1,324 ) (1,292 )
  Dividends paid on Class B shares (1,067 ) (1,046 )
  5,529   (10,261 )
         
Investing activities        
  Customer repayment of investments in service contracts 4,958   4,540  
  Interest received 1,240   1,826  
  Business acquisition (15,810 ) -  
  Acquisition of property, plant and equipment (12,950 ) (9,127 )
  Proceeds from disposal of property, plant and equipment 390   321  
  Acquisition of intangible assets (89 ) (100 )
  Disposal of other non-current assets 76   66  
  Acquisition of non-current financial assets (361 ) -  
  (22,546 ) (2,474 )
         
Net change in cash and cash equivalents (1,526 ) 500  
Cash and cash equivalents, beginning of year 8,888   8,382  
Effect of exchange rate on balances held in foreign currencies of foreign operations 157   6  
Cash and cash equivalents, end of year 7,519   8,888  
Contact:
Jean-Claude Dugas CPA, CA
Vice-President, Finance
Logistec Corporation
jdugas@logistec.com
(514) 985-2345

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