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Savaria Presents the Best Year in Its History Revenue up 56% and Adjusted EBITDA up 31%

LAVAL, Québec, March 27, 2019 (GLOBE NEWSWIRE) -- Savaria Corporation (“Savaria”) (SIS.TO), one of the global leaders in the accessibility industry, announces today its results for fiscal 2018.

Highlights:

  • Revenue of $286 million, up $102.3 million or 55.7%;
  • Gross margin of $93.1 million, up $29.2 million or 45.6%;
  • Operating income of $26.6 million, up $3.9 million or 17.4%;
  • Net earnings of $17.7 million, down $1.6 million or 8.3%;
  • Adjusted EBITDA(1) of $40.8 million, up $9.7 million or 31.1%;
  • 6.5-cent or 20.6% increase of the dividend per share on an annual basis;
  • Acquisition on April 12, 2018 of H.E.S. Elevator Services Inc.’s assets, a leading elevator distributor in the Denver, Colorado area;
  • Completion of the acquisition on July 20, 2018 of Visilift LLC’s assets, a leading manufacturer of round and octagonal panoramic elevators, which enabled Savaria to expand its residential elevators offering;
  • Acquisition on August 31, 2018 of Garaventa Accessibility AG, making Savaria an industry leader with a global presence, an extensive distribution network and the most comprehensive accessibility product line on the market.
(in thousands, except per-share amounts and percentages) Quarters Ended December 31
(Unaudited)
Years Ended December 31,
  2018 2017 Change 2018 2017 Change
Revenue $93,118   $55,249   68.5 % $286,034   $183,741   55.7 %
Gross margin $28,746   $20,053   43.4 % $93,105   $63,925   45.6 %
% of revenue 30.9 % 36.3 % n/a   32.6 % 34.8 % n/a  
Net income $4,756   $8,335   (42,9) % $17,658   $19,248   (8.3) %
% of revenue 5.1 % 15.1 % n/a   6.2 % 10.5 % n/a  
Earnings per share – diluted $0.11   $0.20   (45) % $0.40   $0.47   (14.9) %
Adjusted EBITDA(1) $13,076   $9,537   37.1 % $40,800   $31,115   31.1 %
% of revenue 14.0 % 17.3 % n/a   14.3 % 16.9 % n/a  
Adjusted EBITDA per share – diluted $0.29   $0.24   20.8 % $0.92   $0.77   19.5 %


(1) Earnings before interest, taxes, depreciation, amortization, realized and unrealized business acquisition costs, the value adjustment on acquired inventories, stock-based compensation, restructuring costs of Garaventa’s operations in China, proceeds from insurance claim and gain on financial instrument (see section below “Compliance with International Financial Reporting Standards”).

A Word from the President

“I am very pleased with 2018. We delivered record-setting revenue of $286 million along with our highest-ever adjusted EBITDA of $41 million. In the fourth quarter we generated $93 million in revenue and $13 million of adjusted EBITDA. These achievements are the result of acquisitions, and also of organic growth, particularly in sales of residential elevators which grew at over 10% during the year,” declared Marcel Bourassa, President and Chief Executive Officer of Savaria.

“Savaria has transformed. Although complete integration may take longer than we would like, Savaria has further diversified itself within the accessibility industry, reaching more markets and allowing us to go after greater opportunities. With 1400 employees, 28 direct sales offices and 9 factories comprising over 640,000 sq. ft of production space, the Savaria of today covers significantly more geography, products and distribution channels than ever before.

“Our focus over the next 2 years will be on realizing synergies from past acquisitions, while also exploring new opportunities that complement our current business model. With that in mind, as we look at the current year, please note that our guidance for 2019 given in our press release dated February 19, 2019 is presented on a full-year basis, and our first quarter is traditionally our weakest, largely due to construction delays caused by cold weather in our key markets.

 “Our strong balance sheet has enabled us to realize our goals and we continue to benefit from positive market dynamics in the industries in which we operate, namely an ever-growing aging population in need of mobility equipment and services. As always, I wish to thank our supportive shareholders and employees for their commitment to Savaria,” concluded Mr. Bourassa.

Savaria Corporation (savaria.com) is one of the global leaders in the accessibility industry. It provides accessibility solutions for the physically challenged to increase their comfort, their mobility and their independence. Its product line is one of the most comprehensive on the market. Savaria designs, manufactures, distributes and installs accessibility equipment, such as stairlifts for straight and curved stairs, vertical and inclined wheelchair lifts, elevators for home and commercial use, as well as ceiling lifts. It also manufactures and markets a comprehensive selection of pressure management products for the medical market, medical beds for the long-term care market, mattress overlays and foam pillows for the retail market and certain products for the industrial market. In addition, Savaria converts and adapts vehicles to be wheelchair accessible. Savaria records approximately 75% of its revenue outside of Canada, primarily in the United States. It operates a sales network of some 500 dealers worldwide and 28 direct sales offices in North America, Europe (Switzerland, Germany, Italy, Czech Republic and Poland), Australia and China. Savaria employs approximately 1,400 people globally and its plants are located in Canada: Laval and Magog (Québec), Brampton, Beamsville and Toronto (Ontario) and Surrey (British Columbia), in the United States at Greenville (South Carolina), in Huizhou (China) and in Milan (Italy).

Compliance with International Financial Reporting Standards (“IFRS”)

The information appearing in this press release has been prepared in accordance with IFRS. However, Savaria uses EBITDA, adjusted EBITDA and adjusted EBITDA per share for analysis purposes to measure its financial performance. These measures have no standardized definitions in accordance with IFRS and are therefore regarded as non-IFRS measures. These measures may therefore not be comparable to similar measures reported by other companies. Reconciliation between net income for the period and EBITDA, adjusted EBITDA and adjusted EBITDA per share is provided in the Reconciliation of EBITDA, adjusted EBITDA and adjusted EBITDA per share with Net Income section below.

Cautionary Notice Regarding Forward-Looking Statements

The statements set forth in this press release, which describe Savaria’s objectives, projections, estimates, expectations or forecasts, may constitute forward-looking statements within the meaning of securities legislation. Positive or negative verbs such as “will”, “plan”, “evaluate”, “estimate”, “believe”, “expect” and other related expressions are used to identify such statements. Savaria would like to point out that, by their very nature, forward-looking statements involve risks and uncertainties such that its results, or the measures it adopts, could differ materially from those indicated or underlying these statements, or could have an impact on the degree of realization of a particular projection. Major factors that may lead to a material difference between Savaria’s actual results and the projections or expectations set forth in the forward-looking statements include the effects of the integration of acquired businesses and the ability to achieve projected synergies, fluctuations in margins, competition, exchange rate variations, and such other risks as described in detail from time to time in documents filed by Savaria with securities regulatory authorities in Canada. Unless otherwise required by applicable securities laws, Savaria disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking information in this press release is based on information available as of the date of the release.

Results Webcast on March 28, 2019, at 8:30 a.m. (EDT)

Savaria will host a conference call on Thursday, March 28, 2019 at 8:30 am Eastern Time with financial analysts to discuss results of the quarter and fiscal year ended December 31, 2018. Investors and members of the media are invited to participate on a listen-only basis.  

Conference call access:

Local Dial-in Numbers : (647) 427-7450 or (514) 807-9895

North American Toll Free Number : 1 (888) 231-8191

Webcast URL (EN) : https://event.on24.com/wcc/r/1969507/75B395382F079E008B28829BBA733A60

A replay of the webcast and a recording of the question and answer session will be available on the Corporation’s website at www.savaria.com.

For further information:

Hélène Bernier, CPA, CA
Vice President, Finance
1-800-931-5655, ext. 248
helene.bernier@savaria.com
Marcel Bourassa
Chairman, President and Chief Executive Officer
1-800-661-5112
marcel.bourassa@savaria.com

www.savaria.com
Facebook: https://www.facebook.com/savariabettermobility
Twitter: https://twitter.com/Mobilityforlife

Reconciliation of EBITDA, adjusted EBITDA and adjusted EBITDA per share with net income is provided below. Complete financial statements and the Management’s Report for fiscal 2018 will be available shortly on Savaria’s website and on SEDAR (www.sedar.com).

Reconciliation of EBITDA, adjusted EBITDA and adjusted EBITDA per share with Net Income

(in thousands, except per-share amounts) Quarters Ended
Years Ended  December 31,
December 31, (Unaudited)
 
  2018 2017 2018 2017
Net income $4,756 $8,335 $17,658 $19,248
Plus:        
Interest cost 1,254 503 3,341 1,236
Income tax expense (recovery) 1,857 (2,286) 6,942 1,757
Depreciation of fixed assets 1,401 613 3,664 2,199
Amortization of intangible assets 2,608 1,911 6,153 3,971
Less:        
Interest income 22 3 523 282
EBITDA $11,854 $9,073 $37,235 $28,129
Plus:        
Stock-based compensation 480 315 1,379 890
Business acquisition costs, realized and unrealized 1,033 149 3,040 1,650
Settlement of a litigation 215   215 -
Value adjustment on acquired inventories 331 - 331 446
Restructuring costs for Garaventa Lift's operations in China (672) - 879 -
Less:       -
Proceeds from insurance claim 165 - 1,776 -
Gain on financial instrument - - 503 -
Adjusted EBITDA $13,076 $9,537 $40,800 $31,115
Diluted weighted average number of common shares outstanding 45,676 42,168 44,442 40,599
Adjusted EBITDA per share – diluted $0.29 $0.24 $0.92 $0.77