ADF Group. Inc. – Results for the third quarter and nine-month period ended October 31, 2016

HIGHLIGHTS

  • ADF Group signed $175 million worth in new contracts during the third quarter.
  • The order book reached $216 million as at October 31, 2016 ; a new high since January 2003
  • Revenues totalled $66.4 million for the nine-month periods ended October 31, 2016, slightly below revenues recorded during the same period a year earlier.
  • Increase in net income during the nine-month period ended October 31, 2016, compared with the same period a year ago.

TERREBONNE, QC, Dec. 8, 2016 /CNW Telbec/ – ADF Group Inc. ("ADF" or the "Corporation") (TSX: DRX) recorded revenues of $21.1 million for the third quarter ended October 31, 2016, almost similar to the same period a year ago. For the nine-month period ended October 31, 2016, ADF Group recorded $66.4 million in revenues compared with $69.0 million during the same period in 2015.

The third-quarter gross margin, as in percentage of revenues, stood at 15.4% compared with 21.2% for the corresponding period a year ago. Furthermore, the gross margin during the first nine-month period ended October 31, 2016, posted an increase, reaching $12.4 million or 18.6% of revenues, compared with $10.0 million or 14.4% a year ago.

ADF posted a third-quarter net income of $36,000 ($0.00 per share, basic and diluted) compared with a net income of $1.0 million ($0.03 per share, basic and diluted) a year ago. For the nine-month period ended October 31, 2016, the Corporation posted a net income of $1.2 million ($0.04 per share, basic and diluted) compared with a net income of $0.6 million ($0.02 per share, basic and diluted) during the nine-month period ended October 31, 2015.

The Corporation’s operating activities used cash flows of $1.0 million in the third quarter and $3.5 million during the nine-month period ended October 31, 2016. As at October 31, 2016, the Corporation had a working capital of $24.0 million. The Corporation remains in a solid position to support its ongoing operations, pursue its development projects and remunerate its shareholders in accordance with the dividend payment policy.

As at October 31, 2016, the Corporation’s backlog stood at $215.8 million, compared with $70.6 million as at January 31, 2016. The contracts on hand on October 31, 2016, will be carried out between now and the end of the second quarter of fiscal 2019.

 

Financial Highlights

Three Months

Nine Months

Periods ended October 31

2016

2015

2016

2015

(In thousands of dollars, and dollars per share)

$

$

$

$

Revenues

21,089

21,260

66,390

69,005

EBITDA

1,437

2,848

6,149

5,161

Net income

36

1,041

1,246

561

Per share (basic and diluted)

0.00

0.03

0.04

0.02

Cash flows from (used in) operating activities

(1,046)

1,051

(3,463)

(2,401)

Average number of outstanding shares (basic, in thousands)

32,627

32,625

32,624

32,594

Average number of outstanding shares (diluted, in thousands)

32,677

32,708

32,690

32,833

 

New Orders

During the quarter ended October 31, 2016, the Corporation signed $175 million in new contracts in the United States, amongst which the contract at the new Salt Lake City International Airport. This contract is one of the most important contract ever won by ADF in North America, in terms of value. The other contracts announced by ADF were won in the commercial building sector in Florida and in the US Northeast and Midwest transport infrastructure sector. These new contracts are scheduled to extend between the end of the current fiscal year and the second quarter of ADF Group’s 2019 fiscal year.

Outlook

"We have announced $175 million worth in new contracts during the quarters, bringing our order backlog over the $200-million mark for the first time since January 2003. We are pursuing our efforts to grow our order backlog.

At the same time, and following a global review of our business processes, we have begun the implementation of our new business plan, which aims, among other things, to optimize our five operational units in Terrebonne, Great Falls and Florida. All these measures will allow us to reach our goals of growth and cash generation, while maintaining the level of operational excellence for which our Corporation is known for, for over 60 years" said Mr. Jean Paschini, Co-Chairman of the Board of Directors and Chief Executive Officer.

About ADF Group Inc.

ADF Group Inc. is a North American leader in the design and engineering of connections, fabrication, including the application of industrial coatings, and installation of complex steel structures, heavy steel built-ups, as well as in miscellaneous and architectural metals for the non-residential infrastructure sector. ADF Group Inc. 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. The Corporation operates two fabrication plants and two paint shops, in Canada and in the United States, and a Construction Division in the United States, which specializes in the installation of steel structures and other related products.

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.

Non-IFRS Measures

Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a performance measure recognized by IFRS standards, and is not likely to be comparable to similar measures presented by other issuers. Management, as well as investors, consider this to be useful information to assist them in assessing the Corporation’s profitability and ability to generate funds to finance its operations. Refer to Section 9 "Non-GAAP Measures" of the Corporation’s Management’s Discussion and Analysis for Three-Month and Nine-Month Periods Ended October 31, 2016, for the definition of this metric and reconciliation to the most comparable IRFS measures.

All amounts are in Canadian dollars, unless otherwise indicated.

 

CONFERENCE CALL WITH INVESTOR, DECEMBER 8, 2016 AT 10:00 A.M. (Montreal time)

RESULTS FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED OCTOBER 31, 2016

TO PARTICIPATE, PLEASE DIAL 1-866-865-3087 A FEW MINUTES BEFORE THE START OF THE CALL.

For those unable to participate, a taped rebroadcast will be available from Thursday, December 8, 2016

at 1:00 p.m. until 11:30 p.m., Thursday, December 15, 2016, by dialing 1-855-859-2056; access code 22666157.

The conference call (audio) will also be available on ADF’s Website at www.adfgroup.com.

Members of the media are invited to listen in.

 

SOURCE ADF Group Inc.

Jean Paschini, Co-Chairman of the Board of Directors and Chief Executive Officer; Jean-François Boursier, CPA, CA, Chief Financial Officer, Telephone: (450) 965-1911