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Mercer Park Brand Acquisition Corp. Reports Third Quarter 2020 Financial Results

TORONTO, Nov. 11, 2020 (GLOBE NEWSWIRE) — MERCER PARK BRAND ACQUISITION CORP. (“Mercer” or the “Company”) is reporting its financial results for the three and nine months ended September 30, 2020. The Company’s unaudited interim financial statements along with its management discussion and analysis has been filed on the System for Electronic Document Analysis and Retrieval and may be viewed by shareholders and interested parties under the Company’s profile at www.sedar.com.

About
Mercer Park Brand Acquisition
Corp.

Mercer Park Brand is a special purpose acquisition corporation incorporated under the laws of the Province of British Columbia for the purpose of effecting a Qualifying Transaction.

Forward-Looking Statements

This press release may contain forward looking information within the meaning of applicable securities legislation, which reflects the Company’s current expectations regarding future events. Forward-looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control, that could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. The Company does not undertake any obligation to update such forward looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

FOR FURTHER INFORMATION PLEASE CONTACT: Cody
Slach
& Sean Mansouri Gateway Investor Relations (949) 574-3860 or [email protected]

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Exelerate Capital Corp. Announces Appointment of Michael Boyd to the Board of Directors

Canada NewsWire

VANCOUVER, BC, Nov. 11, 2020 /CNW/ – EXELERATE CAPITAL CORP. (the “Company”) (TSXV: XCAP) is pleased to announce the appointment of Mr. Michael Boyd to the board of directors of the Company.

Mr. Boyd brings over 43 years of professional experience that includes leadership roles in the financial institution and capital markets industries, as well as extensive board governance experience with public and private companies, including roles as Chair of the Audit Committee. Mr. Boyd was a Managing Director at HSBC Capital (Canada) Inc.’s Merchant Banking Group, where he was involved with preovate equity investments and bridge financing transactions. He was also the Managing Partner at Argosy Bridge Management Inc., that managed the Argosy Bridge Fund LPI and LPII, that specialized in enterprise value lending.

Mark Kohler, Chairman of the Board, commented, “I am pleased to have Michael join our board at this time. He brings exceptional expertise to our process of assessing and evaluating potential acquisition targets for our Company, as we near conclusion on various discussions with third parties. He also brings an extensive background in investment banking, value lending, deal structuring, and a responsible approach to optimizing operations and stakeholder outreach. On behalf of the board of directors, it is my pleasure to welcome Michael.

Mr. Kohler added, “The Company is seeing significant opportunities now in acquiring healthcare technology businesses and data privacy and cyber risk platforms that support a secure ‘Information Supply Chain™’ in the vast market called, Digital Health. As well, we see value in the acquisition of the associated technologies that enable impactful and effective transitions of patients and their data from acute care hospitals back to the home care setting.”

The Company has granted Mr. Boyd 100,000 stock options pursuant to the Company’s stock options plan, exercisable at $0.10 per share, vesting equally over the next 9 months, and with a term of five years.

About the Company
The Company is a capital pool company pursuant to Policy 2.4 of the TSX Venture Exchange (the “CPC Policy”). Except as specifically contemplated in the CPC Policy, until the completion of its “Qualifying Transaction” (as defined in the CPC Policy), the Company will not carry on business, other than the identification and evaluation of companies, business or assets with a view to completing a proposed Qualifying Transaction. Investors are cautioned that trading in the securities of a capital pool company is considered highly speculative.

The TSX Venture Exchange has neither approved nor disapproved the contents of this news release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company’s expectations and projections.

SOURCE Exelerate Capital Corp.

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Altius Reports Q3 2020 Attributable Royalty Revenue of $16.2M and Adjusted Operating Cash Flow of $7.3M

Altius Reports Q3 2020 Attributable Royalty Revenue of $16.2M and Adjusted Operating Cash Flow of $7.3M

ST. JOHN’S, Newfoundland–(BUSINESS WIRE)–Altius Minerals Corporation (ALS:TSX) (ATUSF: OTCQX) (“Altius” or the “Corporation”) reports attributable royalty revenue(1) of $16.2 million or $0.39 per share(1) for the third quarter ended September 30, 2020 compared to $19.2 million or $0.45 per share in the comparable quarter last year and $13.0 million or $0.31 per share in Q2 2020.

Adjusted EBITDA of $12.4 million or $0.30 per share compares to $15.2 million or $0.36 per share in Q3 2019 and to $10.0 million or $0.24 per share in Q2 2020. Adjusted operating cash flow(1) of $7.3 million or $0.18 per share is lower than both its year over year comparable period of $14.4 million or $0.36 per share and last quarter’s $13.4 million or $0.32 per share due to timing of royalty receipts and corporate income tax payments. On a year-to-date basis, adjusted operating cash flow of $33.9 million is lower than its comparable period last year of $34.6 million trending with lower revenue as well as timing of corporate tax instalments paid. The Adjusted EBITDA margin in the third quarter was 77%.

Adjusted net earnings of $3.6 million or $0.09 per share compares to $4.3 million or $0.10 per share in Q3 2019 (see table) and to $1.4 million or $0.04 per share in Q2 2020. The adjusted earnings per share follows the trend of lower revenue and excludes non-cash impairment charges of $45.6 million or $1.10 per share versus no comparable amounts in prior year period or Q2 2020. Also impacting adjusted earnings were dilution gains of $2.6 million or $0.05 per share, loss on fair value adjustments of $0.9 million or $0.02 per share offsetting foreign exchange gains of $0.9 million or $0.02 per share. The impairment charges of $45.6 million in the quarter are further explained under “Thermal Coal”.

Portfolio Performance

Base metals (copper, nickel, zinc and cobalt) (53% of total revenue in Q3 2020)

Base metal revenue contributed $8.7 million in the third quarter compared to $8.0 million in the year ago comparable quarter and $4.8 million in the second quarter, reflecting improvements in copper and nickel pricing and the recommencement of operations at Voisey’s Bay. Chapada and 777 provided $4.1 million and $4.2 million respectively while Voisey’s Bay contributed approximately $0.4 million, as the mine resumed operations in July after being placed on care and maintenance. The operator of Chapada, Lundin Mining Corporation (“Lundin”), reported late in Q3 2020 that a main electrical substation failure had caused damage to four ball and SAG mill motors and that there would be an interruption in processing at the Chapada mine. On October 28, 2020 Lundin reported that two spare motors had since been installed and the operation was currently operating at approximately 30% of its throughput capacity. A return to full production is expected late in the fourth quarter of 2020. Due to timing of stream receipts, Altius expects the main royalty revenue impact to be in Q1 2021 rather than Q4 this year. The operator of 777, Hudbay Minerals Inc. (“Hudbay”) announced in October 2020 that production from 777 had been temporarily interrupted after a hoist rope detached from the skip within the production shaft. Hudbay has subsequently reported relatively minor damage that is expected to be repaired during the fourth quarter this year with full production expected to resume in December. We expect the production interruption to impact royalty revenue mainly in the fourth quarter this year.

Potash(19% of total revenue in Q3 2020)

Potash royalty revenue of $3.2 million in the third quarter this year compared to $3.7 million in the comparable quarter last year and $4.0 million in the second quarter of 2020. Volumes remained stable during the quarter while prices remained weak. Operators Nutrien and The Mosaic Company have since commented that prices have begun to rebound on a combination of favorable agricultural crop prices and supply and demand tightening in several major geographies.

Thermal coal (16% of total revenue in Q3 2020)

Thermal coal revenue contributed $2.7 million in the quarter compared to $2.6 million a year ago and to $2.2 million in Q2 2020. Sharp declines in demand in the third quarter due to COVID-19 related shutdowns and reduced oil and gas production activity combined with typical seasonal weakness resulted in lower operating utilization rates and coal royalties during the third quarter. Electricity demand continues to track at lower than normal levels but has now partially rebounded from the third quarter lows. The acquisition of the minority interest from Liberty Metals & Mining Holdings LLC for net cash consideration of $9.0 million, announced on July 27, 2020, resulted in one month of the quarterly revenue (July) being recognized on a 52.4% basis, while August and September were recognized on a 100% basis. The resulting new weighted average purchase price, combined with a conservative view on the prospect for continuing decreased power demand in Alberta, has prompted the Corporation to reduce the combined carrying value of its coal based electrical generation royalties by $45 million. More detail on forecast impacts, particularly from main contributors Sheerness and Genesee, is provided in Note 7 to the Condensed Consolidated Financial Statements.

Iron ore (8% of total revenue in Q3 2020)

Iron ore revenue related to dividends received from Labrador Iron Ore Royalty Corp. (“LIORC”) was $1.3 million in the quarter compared to $3.8 million a year ago and $1.3 million in Q2 2020. Iron Ore Company of Canada has not yet paid a dividend to its shareholders year to date, despite strong market conditions for most of the year, which has in turn translated into a significantly lower pass through of dividends paid by LIORC this year. Altius continues to hold 2.9 million shares of LIORC.

Metallurgical coal (2% of total revenue in Q3 2020)

Metallurgical coal provided $0.3 million, which compares to $0.7 million in the comparable quarter last year and $0.5 million in Q2 2020. Royalty revenue from Cardinal River will decrease as inventory stockpiles are depleted, consistent with disclosure from Teck Resources Limited that the mine is currently in decommissioning after a 51 year operating life. None of the closure or remediation costs will be borne by Altius as a royalty holder.

The following tables summarize the financial results for the quarter ended September 30, 2020 and comparable quarters ended June 30, 2020 and September 30, 2019:

IN THOUSANDS OF CANADIAN DOLLARS
(except per share amounts)		 Three months ended
September 30, 2020 June, 2020 September 30, 2019
Revenue
Attributable royalty

$

16,229

 

$

13,035

 

$

19,231

 

Project generation

 

–

 

 

–

 

 

25

 

Attributable revenue (1)

 

16,229

 

 

13,035

 

 

19,256

 

Adjust: joint venture revenue

 

(966

)

 

(2,765

)

 

(3,674

)

IFRS revenue per consolidated financial statements

$

15,263

 

$

10,270

 

$

15,582

 

 
Total assets

$

556,128

 

$

598,873

 

$

572,679

 

Total liabilities

$

203,893

 

$

209,832

 

$

172,865

 

Cash dividends declared & paid to shareholders

$

1,928

 

$

1,945

 

$

2,137

 

 
Adjusted EBITDA (1)

$

12,426

 

$

10,048

 

$

15,241

 

Adjusted operating cash flow (1)

$

7,330

 

$

13,378

 

$

14,368

 

Net earnings (loss)

$

(39,787

)

$

4,105

 

$

4,614

 

 
Attributable revenue per share (1)

$

0.39

 

$

0.31

 

$

0.45

 

Adjusted EBITDA per share (1)

$

0.30

 

$

0.24

 

$

0.36

 

Adjusted operating cash flow per share (1)

$

0.18

 

$

0.32

 

$

0.34

 

Net earnings (loss) per share, basic and diluted

$

(0.96

)

$

0.10

 

$

0.10

 

Summary of attributable royalty revenue Three months ended
IN THOUSANDS OF CANADIAN DOLLARS September 30, 2020 June 30, 2020 September 30, 2019
Revenue (1)
Base metals
777 Mine

$

4,175

$

2,224

$

2,082

Chapada

 

4,068

 

2,518

 

5,542

Voisey’s Bay

 

434

 

93

 

369

Potash
Cory

 

285

 

271

 

173

Rocanville

 

1,869

 

2,318

 

2,597

Allan

 

121

 

188

 

128

Patience Lake

 

59

 

100

 

30

Esterhazy

 

782

 

1,127

 

743

Vanscoy

 

34

 

–

 

57

Lanigan

 

8

 

8

 

2

Thermal (Electrical) Coal
Genesee

 

1,800

 

1,494

 

1,007

Paintearth

 

–

 

–

 

178

Sheerness

 

700

 

565

 

1,271

Highvale

 

168

 

147

 

155

Iron ore (3)

 

1,293

 

1,293

 

3,782

Metallurgical Coal
Cheviot

 

291

 

466

 

694

Other
Renewables

 

58

 

112

 

142

Coal bed methane

 

79

 

72

 

54

Interest and investment

 

4

 

39

 

225

Attributable royalty revenue

$

16,228

$

13,035

$

19,231

Notes
 

1.

Attributable revenue, adjusted EBITDA and adjusted operating cash flow (and respective per share amounts) are intended to provide additional information only and do not have any standardized meaning prescribed under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these measures differently. The attributable revenue, adjusted EBITDA and adjusted operating cash flow per share metrics divide the respective values by the basic weighted average number of shares outstanding during the period. For a reconciliation of these measures to various IFRS measures, please see the Corporation’s MD&A which is available at http:/altiusminerals.com/financial-statements.

 

 

2.

Adjusted earnings and respective per share amounts are intended to provide additional information only and do not have any standardized meaning prescribed under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate these measures differently. The calculations used for the adjusted earnings per share are as follows:

Adjusted Earnings per Share Three months ended
September 30, 2020 June 30, 2020 September 30, 2019
 
Reported earnings (loss) per share

$

(0.96

)

$

0.10

 

$

0.10

Adjusted for:
Equity accounted for losses/impairments

 

(0.05

)

 

0.01

 

 

–

Impairment charges

 

1.10

 

 

–

 

 

–

(Gain) loss on adjustment of derivatives

 

0.02

 

 

(0.04

)

 

–

(Gain) loss on foreign exchange

 

(0.02

)

 

(0.03

)

 

–

Adjusted earnings per share

$

0.09

 

$

0.04

 

$

0.10

3.

 

LIORC dividend received.

Additional information on the Corporation’s results of operations and developments in its project generation division are included in the Corporation’s MD&A and Financial Statements which were filed on SEDAR today and are also available on the Corporation’s website at www.altiusminerals.com.

Liquidity and Dividend Declaration

Cash at September 30, 2020 was $16 million, with debt of $141 million after repayment of $5 million principal on the term debt facility. The value of the LIORC equity position and junior project generation portfolio was $73.8 million and $45.5 million respectively at quarter end. During the quarter ended September 30, 2020, the Corporation repurchased and cancelled 26,900 shares under its normal course issuer bid. For the nine month period ended September 30, 2020, the number of shares repurchased and cancelled was 644,400 for a total cost of $6,090,000.

The Corporation advises that its board of directors has declared a cash dividend of five cents per common share payable to all shareholders of record at the close of business on November 30, 2020. The dividend is expected to be paid on or about December 15, 2020. This dividend is eligible for payment in common shares under the Dividend Reinvestment Plan (DRIP) announced by press release May 20, 2020, and available to shareholders who are Canadian residents or residents of countries outside the United States. In order to be eligible to participate in respect of the December 15, 2020 dividend, non-registered shareholders must provide instruction to their brokerage and registered shareholders must provide completed enrollment forms to the transfer agent by November 23, five business days prior to record date. Stock market purchases made under the DRIP for the December 15, 2020 payment will be satisfied by issuance from treasury at a 5% discount to the 5 day volume weighted average price ending at the close of trading the day before payment date. Shareholders who have already provided instruction to be enrolled earlier this year will continue to be enrolled unless they direct otherwise. For more information, please see http://www.altiusminerals.com/dividend-reinvestment-plan. Participation in the DRIP is optional and will not impact any cash dividends payable to shareholders who do not elect to participate in the DRIP. The declaration, timing and payment of future dividends will largely depend on the Corporation’s financial results as well as other factors. Dividends paid by Altius on its common shares are eligible dividends for Canadian income tax purposes unless otherwise stated.

Third Quarter 2020 Financial Results Conference Call and Webcast Details

Additional details relating to individual royalty performances and asset level developments will be discussed in a conference call to be held tomorrow, November 12, 2020. The call will be webcast and archived on the Corporation’s website for a limited time. Details for the conference call are as follows:

Date: November 12, 2020

Time: 9:00 AM EST

Toll Free Dial-In Number: +1 (866) 521-4909

International Dial-In Number: +1 (647) 427-2311

Conference Call Title and ID: Altius Third Quarter 2020 Financial Results; 9558089

Webcast Link:Altius Q3 2020 Financial Results

About Altius

Altius’s strategy is to create per share growth through a diversified portfolio of royalty assets that relate to long life, high margin operations. This strategy further provides shareholders with exposures that are well aligned with sustainability-related global growth trends including the electricity generation transition from fossil fuel to renewables, transportation electrification, reduced emissions from steelmaking and increasing agricultural yield requirements. These each hold the potential to cause increased demand for many of Altius’s commodity exposures including copper, renewable based electricity, several key battery metals (lithium, nickel and cobalt), clean iron ore, and potash. Altius has 41,464,462 common shares issued and outstanding that are listed on Canada’s Toronto Stock Exchange. It is a member of both the S&P/TSX Small Cap and S&P/TSX Global Mining Indices.

Forward-Looking Information

This news release contains forward‐looking information. The statements are based on reasonable assumptions and expectations of management and Altius provides no assurance that actual events will meet management’s expectations. In certain cases, forward‐looking information may be identified by such terms as “anticipates”, “believes”, “could”, “estimates”, “expects”, “may”, “shall”, “will”, or “would”. Although Altius believes the expectations expressed in such forward‐looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those projected. Readers should not place undue reliance on forward-looking information. Altius does not undertake to update any forward-looking information contained herein except in accordance with securities regulation.

Flora Wood

Email: [email protected]

Tel: 1.877.576.2209

Direct: +1(416)346.9020

Ben Lewis

Email: [email protected]

Tel: 1.877.576.2209

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Natural Resources Other Natural Resources Mining/Minerals

MEDIA:

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New Pacific Reports Financial Results for the Three Months Ended September 30, 2020

VANCOUVER, British Columbia, Nov. 11, 2020 (GLOBE NEWSWIRE) — New Pacific Metals Corp. (“New Pacific” or the “Company”) reports its unaudited condensed consolidated interim financial results for the three months ended September 30, 2020. This news release should be read in conjunction with the Company’s MD&A and the financial statements and notes thereto for the corresponding period which have been posted under the Company’s profile on SEDAR at www.sedar.com and are also available on the Company’s website at www.newpacificmetals.com. All figures are expressed in Canadian dollars unless otherwise stated.

QUARTERLY
HIGHLIGHTS

  • Working capital of $68.88 million to advance the Silver Sand Project and regional exploration initiatives including the Silverstrike Project;
  • Continued to expand the Snake Hole Zone on the Silver Sand Project – intersecting 30.9 m @ 159 g/t Ag including 12.2 m @ 354 g/t Ag (see news release dated August 6, 2020 for details);
  • Commenced field work on the Silverstrike Project – results indicating good to excellent potential for both high-grade and near-surface bulk tonnage silver-rich polymetallic mineralization at Silverstrike North (see news release dated September 29, 2020 for details);
  • Silver Sand Preliminary Economic Assessment, Environmental and Social studies commenced during the quarter;
  • Continued focus on Sustainability – expanded the Bolivian CSR team with key hires;
  • Received 99.77% shareholders’ support to continue creating shareholder value by spinning out the Tagish Lake Gold project into Whitehorse Gold Corp.; and  
  • Graduated from the TSX Venture Exchange to the Toronto Stock Exchange and added to the VanEck Vectors Junior Gold Miners ETF (“GDXJ”).

FINANCIAL RESULTS

Working Capital
: As at September 30, 2020, the Company had working capital of $68.88 million.

Net
loss
attributable to equity holders of the Company for the three months ended September 30, 2020 was $1.51 million or $0.01 per share (three months ended September 30, 2019 – net income of $1.29 million or $0.01 per share).  

The Company’s financial results were mainly impacted by: (i) income from investments of $0.84 million compared to income of $2.12 million in the prior year quarter; (ii) operating expenses of $2.03 million compared to $1.01 in the prior year quarter; and (iii) foreign exchange loss of $0.32 million compared to gain of $0.18 million in the prior year quarter.

Income
from investments for the three months ended September 30, 2020 was $0.84 million (three months ended September 30, 2019 – $2.12 million) and comprised of a $0.76 million gain on the Company’s equity investments, a $0.04 million loss from fair value change offset by interest earned on bonds, $0.07 million in dividends received from the preferred share portfolio, and $0.05 million in interest earned from GICs and other cash accounts. As at the date of this news release, the Company’s material investments are preferred shares issued by the largest five Canadian banks with weighted average dividends yield of 5.68% and Canadian GICs earning weighted average interest of 1.02%.

Operating expenses for the three months ended September 30, 2020 were $2.03 million (three months ended September 30, 2019 – $1.01 million).  

Foreign exchange
loss for the three months ended September 30, 2020 was $0.32 million (three months ended September 30, 2019 – gain of $0.18 million).  

The Company holds a large portion of cash and cash equivalents and bonds in US dollars while the Company’s functional currency is the Canadian dollar. The fluctuation in exchange rates between the US dollar and the Canadian dollar will impact the financial results of the Company. During the three months ended September 30, 2020, the US dollar depreciated by 2.1% against the Canadian dollar (from 1.3628 to 1.3339) while in the prior year quarter the US dollar appreciated by 1.2% against the Canadian dollar (from 1.3087 to 1.3243).

SILVER SAND PROJECT

The Company has carried out extensive exploration and resource definition drill programs on its Silver Sand Project since acquiring the project in 2017. From 2017 to 2019, the Company completed a total of 97,619 m of drilling in 386 holes – one of the largest green fields discovery drill programs in South America during this period.

On April 14, 2020, the Company released the inaugural National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) Mineral Resource estimate for the Silver Sand Project. Using a 45 g/t silver cut-off-grade the estimate reported Measured & Indicated resource tonnes of 35.39 Mt at 137 g/t Ag for 155.86 Moz and Inferred resource tonnes of 9.84 Mt at 112 g/t Ag for 35.55 Moz. See news release dated April 14, 2020 and an amended and restated the technical report entitled “Silver Sand Deposit Mineral Resource Report (Amended)” with an effective date of January 16, 2020 filed under the Company’s profile on SEDAR for details.

The Company commenced its 2020 drill campaign during the first quarter of 2020. A total of 1,589.75 m of drilling was completed before field-based operations in Bolivia were suspended due to the COVID-19 pandemic. Advanced studies have commenced on the project, and following a competitive tendering process, the Company selected CSA Global Consultants Canada Ltd. (an ERM Group company), Knight Piésold Consultores S.A., and Wood plc (an Amec Foster Wheeler company) to lead the Preliminary Economic Assessment, Environmental baseline study, and Social baseline studies, respectively. The initial desktop portion of the studies are currently in progress.

For the three months ended September 30, 2020, total expenditures of $0.91 million (three months ended September 30, 2019 – $4.84 million) were capitalized under the Silver Sand Project.

SILVERSTRIKE PROJECT

In December 2019, the Company acquired a 98% interest in the Silverstrike Project from an arm’s length private Bolivian corporation (the “Vendor”) by making a one-time cash payment of US$1.35 million. Under the agreement the Company’s Bolivian subsidiary is required to cover 100% of the future expenditures including exploration, development and mining production activities at the Silverstrike Project.  The agreement has a term of 30 years and renewable for another 15 years. It is subject to an approval by Bolivia’s Jurisdictional Mining Administrative Authority (AutoridadJurisdiccionalAdministrativa Minera or “AJAM”) .

The Silverstrike Project consists of approximately 13 km2 and is located approximately 140 km southwest of La Paz, Bolivia.  The Silverstrike Project shares many similarities with the Silver Sand Project pre-discovery drilling namely: sandstone hosted structurally controlled silver-polymetallic mineralization centered on a historic mining district – the Berenguela District, presence of felsic Tertiary intrusives with corresponding multiple silver rich occurrences associated with extensive sercitic alteration and underexplored with limited modern exploration. During the three months ended September 30, 2020, the Company’s exploration team commenced reconnaissance and detailed mapping and sampling programs on the northern portion of the project. The results to date indicate good to excellent exploration potential for hosting narrow high-grade and near-surface broad-zones of silver mineralization. See news release dated September 29, 2020 for details.

For the three months ended September 30, 2020, total expenditures of $0.55 million (three months ended September 30, 2019 – $nil) were capitalized under the Silverstrike Project.

Technical information contained in this news release has been reviewed and approved by Alex Zhang, P. Geo., Vice President of Exploration, who is a Qualified Person for the purposes of NI 43-101.

ABOUT NEW PACIFIC

New Pacific is a Canadian exploration and development company which owns the Silver Sand Project, in the Potosí Department of Bolivia, and the Tagish Lake Gold Project in Yukon, Canada.

For further information, please contact:

New Pacific Metals Corp.
Gordon Neal
President
Phone: (604) 633-1368
Fax: (604) 669-9387
[email protected]
www.newpacificmetals.com

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

Certain of the statements and information in this news release constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward-looking information” within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “is expected”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategies”, “targets”, “goals”, “forecasts”, “objectives”, “budgets”, “schedules”, “potential” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements or information.
Such statements include, but are not limited to:
statements regarding anticipated exploration, drilling, development, construction, and other activities or achievements of the Company; timing of receipt of permits and regulatory approvals, including TSXV approval of the spin-out and the listing of the Whitehorse Gold common shares on the TSXV; and estimates of the Company’s revenues and capital expenditures.
.

Forward-looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward-looking statements or information, including, without limitation, risks relating to: global economic and social impact of COVID-19; fluctuating equity prices, bond prices, commodity prices; calculation of resources, reserves and mineralization,
general economic conditions,
foreign exchange risks, interest rate risk, foreign investment risk; loss of key personnel; conflicts of interest; dependence on management
,
uncertainties relating to the availability and costs of financing needed in the future, environmental risks, operations and political conditions, the regulatory environment in Bolivia and Canada,
and
other factors described
under the heading “Risk Factors” in the Company’s Annual Information Form
for
the year ended June 30, 2020 and its other public filings
.

This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements or information.

The forward-looking statements are necessarily based on a number of estimates, assumptions, beliefs, expectations and opinions of management as of the date of this
news release
that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. These estimates, assumptions, beliefs, expectations and options include, but are not limited to, those related to the Company’s ability to carry on current and future operations, including: the duration and effects of COVID-19 on our operations and workforce; development and exploration activities; the timing, extent, duration and economic viability of such operations; the accuracy and reliability of estimates, projections, forecasts, studies and assessments; the Company’s ability to meet or achieve estimates, projections and forecasts;
the stabilization of the political climate in Bolivia
;
the availability and cost of inputs; the price and market for outputs; foreign exchange rates; taxation levels; the timely receipt of necessary approvals or permits; the ability to meet current and future obligations; the ability to obtain timely financing on reasonable terms when required; the current and future social, economic and political conditions; and other assumptions and factors generally associated with the mining industry.

Although the forward-looking statements contained in this
news release
are based upon what management believes are reasonable assumptions, there can be no assurance that actual results will be consistent with these forward-looking statements. All forward-looking statements in this
news release
are qualified by these cautionary statements. Accordingly, readers should not place undue reliance on such statements. Other than specifically required by applicable laws, the Company is under no obligation and expressly disclaims any such obligation to update or alter the forward-looking statements whether as a result of new information, future events or otherwise except as may be required by law. These forward-looking statements are made as of the date of this
news release
.

CAUTIONARY NOTE TO US INVESTORS

The disclosure
in this news release
was prepared in accordance with Canadian National Instrument 43-101 (“NI 43-101”)
and the
Canadian Institute of Mining, Metallurgy and Petroleum Standards
(the “CIM Definition Standards”)
incorporated by reference
therein
, which differs significantly from the current requirements of the U.S. Securities and
Exchange Commission (the “SEC”) set out in Industry Guide 7. Accordingly, such disclosure may
not be comparable to similar information made public by companies that report in accordance with
Industry Guide 7.
In particular, this news release may refer to “mineral resources”, “measured
mineral resources”, “indicated mineral resources” or “inferred mineral resources”. While these
categories of mineralization are recognized and required by Canadian securities laws, they are not
recognized by Industry Guide 7 and are not normally permitted to be disclosed in SEC filings by
U.S. companies that are subject to Industry Guide 7. U.S. investors are cautioned not to assume
that any part of a “mineral resource”, “measured mineral resource”, “indicated mineral resource”,
or “inferred mineral resource” will ever be converted into a “reserve.” In addition, “reserves”
reported by the Company under Canadian standards may not qualify
as reserves under Industry
Guide 7. Under Industry Guide 7, mineralization may not be classified as a “reserve” unless the
mineralization can be economically and legally extracted or produced at the time the “reserve”
determination is made. Accordingly, information contained or referenced in this news release
containing descriptions of mineral deposits may not be comparable to similar information made
public by U.S. companies subject to
the United States federal securities laws and the rules and regulations thereunder
.
“Inferred mineral resources” are that part of a mineral resource for which quantity and grade or quality are estimated
on the basis of
limited geological evidence and sampling. Such geological evidence is sufficient to imply but not verify geological and grade or quality continuity. However, it is reasonably expected that
the majority of
inferred mineral resources could be upgraded to indicated mineral resources with continued exploration.
Readers
are cautioned not to assume that all or any part of an inferred mineral resource is economically or legally
mineable. 
Further
, while NI 43-101
permits companies to disclose economic projections contained in preliminary economic
assessments and pre-feasibility studies, which are not based on “reserves”, U.S. companies have
not generally been permitted under Industry Guide 7 to disclose economic projections for a mineral
property in their SEC filings prior to the establishment of “reserves”. Disclosure of “contained
ounces” in a resource is permitted disclosure under Canadian reporting standards; however,
Industry Guide 7 normally only permits issuers to report mineralization that does not constitute
“reserves” by Industry Guide 7 standards as in-place tonnage and grade without reference to unit
measures. Historical results or feasibility models presented herein are not guarantees or
expectations of future performance.

The SEC adopted new mining disclosure rules under subpart 1300 of Regulation S-K of the U.S. Securities Act (the “
SEC
Modernization Rules”) effective February 25, 2019, with compliance required for the first fiscal year beginning on or after January 1, 2021. The SEC Modernization Rules replace the historical property disclosure requirements included in SEC Industry Guide 7. As a result of the adoption of the SEC Modernization Rules, the SEC now recognizes estimates of “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources”. In addition, the SEC has amended its definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” to be substantially similar to corresponding definitions under the CIM Definition
Standards .
During the period leading up to the compliance date of the SEC Modernization Rules, information regarding minimal resources or reserves contained or referenced in this
news release
may not be comparable to similar information made public by companies that report according to U.S. standards. While the
SEC
Modernization Rules are expected to be “substantially similar” to the CIM Definitions standards, readers are cautioned that there are differences between the
SEC
Modernization Rules and the CIM Definitions Standards.

Posted on

Atento Reports Fiscal 2020 Third Quarter Results

Revenue growth accelerates 10.5% sequentially and rises 2.2% YoY on consistent Multisector growth across regions, driven by next-generation services, Brazil and US+Nearshore

EBITDA up 102% sequentially and 13.9% YoY on 10.8% rise in Multisector sales, more profitable programs and higher operating efficiencies

YTD free cash flow of $9 million, up approximately $100 million YoY

PR Newswire

NEW YORK, Nov. 11, 2020 /PRNewswire/ — Atento S.A. (NYSE: ATTO) (“Atento” or the “Company”), the largest provider of customer-relationship management and business-process outsourcing services in Latin America, and among the top five providers globally, today announced its third quarter operating and financial results for the period ending September 30, 2020. All comparisons in this announcement are year-over-year (YoY) and in constant-currency (CCY), unless noted otherwise, and may differ from the corresponding 6-K filing due to certain intra-group eliminations.



Three Horizon Plan continues driving profitable growth on higher mix of Multisector sales and Next Generation Services

  • Consistent Multisector growth (+10.8% YoY) across all regions, driven by Next Generation Services, Brazil and US clients
  • Multisector now represents 68% of consolidated revenues, with Born-digital comprising 6% of revenue mix
  • TEF revenues increase 16.8% sequentially; reshaping the relationship, moving into NextGen services and remaining the leader in CX share of client’s wallet;.
  • EBITDA increases in all regions, with total EBITDA rising 13.9% on continued improvements in client and services mix as well as higher efficiency levels
  • EBITDA margin expands 560 bps sequentially and 100 bps YoY to 12.7%, with Brazil margin increasing 260 bps to 16.2%



Operational improvements continue raising efficiency levels

  • Approximately $65 million of $80 million in target annualized cost savings implemented YTD through operations rightsizing, shared services, strict cost controls, Atento@Home operating model and ZBB



FCF generation reduces net debt for third consecutive quarter, while cash position remains healthy

  • 9M FCF of $9 million versus negative $88 million in 9M19
  • Net debt falls 9.0% YoY to $514.2 million; Leverage remains under control at 3.2x when excluding Argentina impairment in Q4 2019
  • Solid cash position of $196.6 million



Atento maintains undisputed leadership in Latin America*

  • Market share nearly three times greater than next-largest competitor in domestic CRM/BPO segment
  • 27.9% of market share in Brazil, with 19.4 p.p. lead to country´s number two

 

* Frost & Sullivan: “Growth Opportunities in the Customer Experience Outsourcing Services Market in Latin America and the Caribbean” (2019)

 



Summarized Consolidated Financials


($ in millions except EPS)


Q3 2020

Q3 2019


CCY
Growth

(1)


YTD 2020

YTD 2019


CCY
Growth

(1)



Income Statement


Revenue

352.7

412.3

2.2%

1,042.7

1,290.1

-4.3%


EBITDA (2)

44.8

48.1

13.9%

107.8

132.7

-1.5%



      EBITDA Margin


12.7%


11.7%


1.0 p.p.

10.3%


10.3%


0.1 p.p.

Net Income (3)

(13.1)

1.3


N.M

(38.9)

(51.1)


-18.0%

Recurring Net Income (2)

(1.2)

1.6


-45.3%

(14.6)

(9.1)


-37.2%

Earnings Per Share in the reverse split basis (2) (3) (5)

($0.93)

$0.09


N.M.

($2.75)

($3.53)


-15.8%

Recurring EPS in the reverse split basis (2) (5)

($0.09)

$0.11


N.M.

($1.04)

($0.62)


-42.3%



Cash Flow, Debt and Leverage


Net Cash Used In Operating Activities

10.7

12.1

68.2

(1.6)


Cash and Cash Equivalents

196.6

105.5


Net Debt (4)

514.2

564.9


Net Leverage (4)

4.0

3.3

(1)

Unless otherwise noted, all results are for Q3 2020; all revenue growth rates are on a constant currency basis, year-over-year.

(2)

EBITDA, Recurring Net Income/Recurring Earnings per Share (EPS) are Non-GAAP measures.

(3)

Reported Net Income and Earnings per Share (EPS) include the impact of non-cash foreign exchange gains/losses on intercompany balances.

(4)

Includes IFRS 16 impact in Net Debt and Leverage

(5)

Earnings per share and Recurring Earnings per share in the reverse split basis is calculated by applying the ratio of conversion of 5.027090466672970 used in the reverse split  into the previous weighted average number of ordinary shares outstanding


Message from the CEO and CFO

Carlos López-Abadía, Atento’s Chief Executive Officer, commented, “As we promised in our Q2 earnings call, our business continued to recover significantly on still improving market conditions, with revenue growing over 10% sequentially, EBITDA doubling and our margin expanding almost 600 basis points, all three of which are above pre-crisis levels. The strong and broad-based recovery in our performance, which continues today, reflects consistent and disciplined execution of our Three Horizon Plan, which drove Multisector sales higher across all three of Atento’s geographic markets during the quarter. Our multisector clients now represent almost 70% of revenues, up from 60% when we started to implement the strategic plan. Moreover, we have been expanding into fast-growing verticals, such as born digital, tech, e-commerce and media, which are businesses that demand more digital and tech enabled solutions and therefore carry higher margins. We are also reshaping the relationship with Telefónica by selling more of these higher margin services to them, helping solidify Atento’s position as the company’s Partner of Choice and driving revenues 17% sequentially higher with this client.

With the recent inauguration of innovation centers in Brazil and Spain, we intend to strengthen our culture of innovation as well as Atento’s leadership in fundamentally transforming and substantially improving the Customer Experience delivered by our industry. This year alone, 10% of Atento’s new sales were for next generation services developed within the last 12 months. Atento’s governance has also been strengthening, with the appointment of two additional independent directors in the last six months, one of whom brings substantial experience managing and governing technology companies. 

As we approach the end of the year, we are operating at significantly higher performance levels and from a position of relative strength, one that enables us to continue effectively addressing the many challenges of today’s still complex and highly dynamic operating environment, while seizing more of the opportunities emerging among high-growth verticals in Brazil and the Americas and from ever-growing demand for innovative next-generation CX and BPO services. We remain confident in our ability to successfully execute in both regards, given the proven effectiveness of our Three Horizon Plan, Atento’s growing technology progress, and our commanding market position in Latin America. We therefore expect to end 2020 with EBITDA levels similar to last year’s in current currency, which is a remarkable result considering the significant crisis and an adverse BRL devaluation of 35%. This means a 200 basis points margin expansion versus 2019 and the implied exit rate we forecast to Q4 gives us confidence to continue delivering improved results in 2021 and puts us on track to deliver the 2022 targets that we communicated last November in our Investor Day. We expect the market to recognize the track record we have created in the last couple of quarters and, as we continue to deliver better results, our share price will reflect the solid fundamentals of our business.”

José Azevedo, Atento’s Chief Financial Officer, said, “Our third quarter financial and operating results make clear that we continue to improve operationally. The fundamental changes we have been making within our business, in terms of sustainable top line growth, a more diversified and profitable revenue stream, and more efficient delivery, are now driving operating and free cash flow higher. We generated $9 million free cashflow in the first nine months of the year, an increase of almost $100 million when compared to the same period of 2019, and we accomplished this despite the impact of COVID-19 across our markets. This allowed for a decrease in our net debt for the third consecutive quarter, which combined with increasing EBITDA,makes us confident towards our target of 2.0 to 2.5 times net debt-to-EBITDA. In the meantime, we are comfortable with our current level of leverage and remain committed to refinancing Atento’s 2022 bond, with the aim of improving our debt profile and capital structure as another means to unlock shareholder value.”


Third Quarter and Nine Months 2020 Consolidated Financial Results

Atento’s revenue grew 10.5% sequentially and 2.2% YoY to $352.7 million, based on strong Multisector sales, which increased 7.8% and 10.8%, respectively, to $238.0 million. While the pandemic demanded a flexible business model and fast decisions, such as a rapid transition to a work at home model, the dynamics of the crisis has accelerated positive demand, mainly in the digital space, as consumers shift more of their purchases online. Capitalizing on these trends, Atento increased Multisector revenue during the third quarter, mainly driven by the Americas, which increased sales in this category 13.1% YoY, and by Brazil, where these sales grew 5.3% during this period. US and Nearshore sales continued contributing to Multisector growth, rising 20% YoY. Atento’s base of Born-Digital, Tech and Media & Entertainment clients continued expanding during the quarter, with 20 new clients and new next gen sales increasing 23% YoY. Within the Company’s 9M revenue mix, sales to Born-digital Companies expanded from 2.7% to 6.0%.

Growth in total revenue was partially offset by an 11.9% decrease in Telefónica’s, although a greater proportion of TEF sales during the third quarter already comprised next-generation services and Atento increased share of wallet with this client. More importantly,  TEF revenue increased 16.8% sequentially.

Consolidated EBITDA increased 13.9% to $44.8 million, based on higher sales, continued improvements in the client and services mix, as well as higher efficiency levels. The corresponding margins expanded 560 basis points sequentially and 100 basis points YoY, with Brazil’s margin expanding 260 basis points YoY to 16.2%.

During the quarter, the Company continued making operational improvements under the Three Horizon Plan, with approximately $65 million of annualized cost savings implemented YTD of the $80 million targeted. Ongoing efficiency initiatives include the rightsizing of Atento’s operations, maintaining strict cost controls, increasing use of the Atento@home operating model, implementing Zero-Based Budgeting, as well as expanding the use of shared services, among other initiatives to reduce SG&A expenses.

Recurring net income improved sequentially to a loss of $1.2 million from a loss of $10.2 million in 2Q 2020, or a YoY decrease of $3.2 million compared to 3Q 2019. Recurring EPS was a negative $0.09 in 3Q 2020 versus positive $0.11 in last year’s quarter and negative $0.72 in 2Q 2020.

Atento maintained a comfortable level of financial liquidity at the end of the quarter, with net debt decreasing for the third consecutive quarter to $514.2 million, representing a YoY decrease of 9%, and a cash position of $196.6 million, including revolvers. During 9M 2020, the Company generated $9.3 million in FCF, a $97.4 million increase compared to negative $88 million in YTD 2019, on client contracts that generate higher levels of profitability and on further improvements in working capital that stem from rigorous financial controls that have been implemented.



Segment Reporting



Brazil


($ in millions)


Q3 2020

Q3 2019


CCY growth


YTD 2020

YTD 2019


CCY growth


Brazil Region

Revenue

145.2

203.8

-3.4%

452.5

632.5

-7.5%

Adjusted EBITDA

23.5

27.7

15.4%

58.5

82.0

-7.2%


Adjusted EBITDA Margin

16.2%

13.6%

2.6 p.p.

12.9%

13.0%

0.0 p.p.

Operating Income/(loss)

(5.2)

(4.4)

53.6%

(21.4)

(13.3)

105.2%

In Brazil, Atento’s flagship business, Multisector sales grew 4.5% sequentially and 5.3% YoY to $112.4 million. The growth was due to an increase in sales to Born-digital companies, which have been purchasing more-next generation services, including high value voice, integrated multichannel and automated back office services. Multisector sales accounted for 77.7% of total revenue in this market, 610 basis points higher than year-end 2019.

TEF revenues, in turn, decreased 24.8%, which resulted in a 3.4% YoY decline in total Brazil revenue to $145.2 million. The decrease was mainly related to the unprofitable client programs that had been returned in Q4 2019. On a sequential basis,  TEF revenue increased 20.8% in Brazil.

Brazil’s profitability improved significantly during the quarter. Adjusted EBITDA increased 15.4% to $23.5 million, with the corresponding margin expanding 260 basis points YoY to 16.2% on a greater proportion of new next-generation services with margins above 20%. Adjusted EBITDA also benefited from the discontinuation of unprofitable programs in Q4 2019, which has had an estimated recurring positive impact of 100bps since Q1 2020.



Americas Region


($ in millions)


Q3 2020

Q3 2019


CCY growth


YTD 2020

YTD 2019


CCY growth


Americas Region

Revenue

148.8

159.6

4.0%

426.1

493.1

-2.1%

Adjusted EBITDA

17.1

17.5

9.1%

45.3

50.2

-0.2%


Adjusted EBITDA Margin

11.5%

11.0%

0.5 p.p.

10.6%

10.2%

0.5 p.p.

Operating Income/(loss)

(0.8)

(1.8)

44.5%

(8.0)

(9.2)

24.7%

Americas revenue increased 4.0% to $148.8 million on a 17.5% increase in Multisector revenues. S and Nearshore revenues increased 20%. In South America, Multisector sales were strong in Colombia, a country that is expect to continue delivering growth, as it is a hub for Atento’s EMEA and US nearshore businesses. We continue to expand our business in the hard currency, with Multisector revenues growing 20% in the US & Nearshore region. As a percentage of total revenue in the Americas, Multisector sales expanded 370 basis points to 65.9% versus year-end 2019.

Growth generated from Multisector clients was partially offset by a 14.9% decrease in TEF sales in the Americas, primarily due to persistent volume declines in Peru, where the pandemic continued to have a severe economic impact. Sequentially, TEF revenue increased 15.5%  in the region.

Such performance, coupled with increased operating efficiency contributed to margin improvement. The region’s Adjusted EBITDA increased 9.1% to $17.1 million, while the corresponding margin expanded 50 basis points to 11.5%.



EMEA Region


($ in millions)


Q3 2020

Q3 2019


CCY growth


YTD 2020

YTD 2019


CCY growth


EMEA Region

Revenue

60.5

52.1

10.7%

168.5

175.4

-3.7%

Adjusted EBITDA

7.3

5.9

18.7%

10.8

17.8

-38.9%


Adjusted EBITDA Margin

12.1%

11.4%

0.7 p.p.

6.4%

10.1%

-3.7 p.p.

Operating Income/(loss)

2.6

(0.1)

N.M

(1.3)

0.1

N.M

In EMEA, Atento continued to diversify its revenue base through expanded Multisector sales, which grew 6.1% to 48.2% of total revenue, up 600 basis from the same period in 2019. Driving growth in this category were higher volumes and new business at current customers, in addition to new clients.

A 15.4% increase in TEF revenue also contributed to the 10.7% increase in total revenue of $60.5 million, due to higher volumes, although this compares with an unusually low volume base in the prior year’s quarter. On a sequential basis, TEF revenues increased 14.0% in the region.

EMEA’s Adjusted EBITDA increased 18.7% to $7.3 million on sales growth, a greater proportion of Multisector sales and next-generation services in the revenue mix, as well as improved efficiency levels under the Company’s transformation plan, with the corresponding margin increasing 70 basis points to 12.1%.



Cash Flow and Capital Structure


($ in millions)


Q3 2020


Q3 2019


YTD 2020


YTD 2019


Cash and cash equivalents at beginning of period


207.2


116.6


124.7


133.5

Net Cash (used in) from Operating activities

10.7

12.1

68.2

-1.6

Net Cash used in Investing activities

-8.7

-10.6

-27.4

-48.7

Net Cash provided by Financing activities

-21.1

-4.7

36.2

29.6


Net (increase/decrease) in cash and cash equivalents


-19.1


-3.2


77.0


-20.7

Effect of changes in exchanges rates

8.5

-7.9

-5.1

-7.3


Cash and cash equivalents at end of period


196.6


105.5


196.6


105.5

At the end of Q3 2020, Atento’s cash and cash equivalents totaled $196.6 million, down $10.6 million sequentially due to payments of interest on the 2022 bond, partial pre-payment of higher cost revolvers and payments of certain taxes deferred in Q2 due to the pandemic. This amount includes approximately $80 million of existing revolvers.

Cash capex was 2.6% in YTD 2020, flat compared to YTD 2019, as the Company emphasized cash preservation and limited investments to essential capex during the second quarter, due to the pandemic. For the year, the company expects cash capex to be approximately 3% of revenues.

Total debt was $710.8 million, including $123.3 million related to IFRS16, with an average maturity of 1.7 years and an average LTM cost of 6.3%.

Net debt decreased 9.0% YoY to $514.2 million at the end of the quarter, the third consecutive quarterly decrease.

LTM net-debt-to-EBITDA was 4.0 times, mainly due to COVID-19’s impact on EBITDA in Q2 2020, the $30.9 million impairment charge in Argentina in Q4 2010 and 16% FX impact on LTM EBITDA. Leverage remains under control due to the Company’s current debt maturity profile and EBITDA generation during the third quarter. Excluding the aforementioned impairment charge, the leverage ratio was 3.2 times, down from 3.3 times at the end of September 2019, an improvement that was achieved during a period when the value of the Brazilian real declined 35%. The Company continues to focus on refinancing the $500 million 2022 notes, in order to extend the maturity of this debt and to improve Atento’s capital structure, as another means to unlock shareholder values.


($ in millions) as of June 30, 2020


Maturity


Interest Rate


Outstanding
Balance 3Q20


Indebtedness

Senior Secured Notes

2022

6.125%

497.0

Super Senior Credit Facility

2020

5.223%

50.1

Other Credit Facilities

2020

CDI + 2.40

25.0

Other borrowings and leases

2023

Variable

14.9

BNDES (BRL)

2022

TJLP + 2.0%

0.6

Debt with third parties


587.6

Leasing (IFRS16)


123.3

Gross Debt (third parties + IFRS16)

710.8

Cash and Cash Equivalents

196.6


Net Debt


514.2

 



Resuming 2020 Guidance


FY 2020

Revenue growth (in constant currency)

~ -5%

EBITDA margin

~ 11%

Cash Capex (as % of revenues)

~ 3%

Leverage (x)

~ 4x


Share Repurchase Program

In the quarter, the Company repurchased 42,237 shares under its Share Repurchase Program, at a cost of $0.4 million, an average price of $8.75. At the end of September 2020, Atento held 973,138 shares in treasury.


Reverse Share Split

As of July 28, Atento SA announced a reverse share split that converted the Company’s entire share capital of 75,406,357 into 15,000,000 shares.


Conference Call

The Company will host a conference call and webcast on Thursday, November 12, 2020 at 10:00 am ET to discuss its financial results. The conference call can be accessed by dialing: USA: +1 (412) 717-9627; UK: (+44) 20 3795 9972; Brazil: (+55) 11 3181-8565; or Spain: (+34) 91 038 9593. It can also be accessed by web phone (Click here). No passcode is required. Individuals who dial in will be asked to identify themselves and their affiliations. The live webcast of the conference call will be available on Atento’s Investor Relations website at investors.atento.com (Click here). A web-based archive of the conference call will also be available at the above website.


About Atento

Atento is the largest provider of customer relationship management and business process outsourcing (CRM BPO) services in Latin America, and among the top five providers globally, based on revenues. Atento is also a leading provider of nearshoring CRM/BPO services to companies that carry out their activities in the United States. Since 1999, the company has developed its business model in 13 countries where it employs 150,000 people. Atento has over 400 clients to whom it offers a wide range of CRM/BPO services through multiple channels. Atento’s clients are mostly leading multinational corporations in sectors such as telecommunications, banking and financial services, health, retail and public administrations, among others. In 2019, Atento was named one of the World’s 25 Best Multinational Workplaces and one of the Best Multinationals to Work for in Latin America by Great Place to Work®. Atento is also the world’s first CRM company to be ISO 56002 certified in Innovation Management. Atento’s shares trade under the symbol ATTO on the New York Stock Exchange (NYSE). For more information visit www.atento.com.


Investor Relations 

Shay Chor 
+ 55 11 3293-5926
[email protected]


Investor Relations  

Fernando Schneider

+ 55 11 3779-8119


[email protected]


Media Relations 
Pablo Sánchez Pérez

+34 670031347
[email protected]


Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking statements can be identified by the use of words such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “intends,” “continue” or similar terminology. These statements reflect only Atento’s current expectations and are not guarantees of future performance or results. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the potential impacts of the Covid-19 pandemic on our business operations, financial results and financial position and on the world economy. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. These risks and uncertainties include, but are not limited to, competition in Atento’s highly competitive industries; increases in the cost of voice and data services or significant interruptions in these services; Atento’s ability to keep pace with its clients’ needs for rapid technological change and systems availability; the continued deployment and adoption of emerging technologies; the loss, financial difficulties or bankruptcy of any key clients; the effects of global economic trends on the businesses of Atento’s clients; the non-exclusive nature of Atento’s client contracts and the absence of revenue commitments; security and privacy breaches of the systems Atento uses to protect personal data; the cost of pending and future litigation; the cost of defending Atento against intellectual property infringement claims; extensive regulation affecting many of Atento’s businesses; Atento’s ability to protect its proprietary information or technology; service interruptions to Atento’s data and operation centers; Atento’s ability to retain key personnel and attract a sufficient number of qualified employees; increases in labor costs and turnover rates; the political, economic and other conditions in the countries where Atento operates; changes in foreign exchange rates; Atento’s ability to complete future acquisitions and integrate or achieve the objectives of its recent and future acquisitions; future impairments of our substantial goodwill, intangible assets, or other long-lived assets; and Atento’s ability to recover consumer receivables on behalf of its clients. In addition, Atento is subject to risks related to its level of indebtedness. Such risks include Atento’s ability to generate sufficient cash to service its indebtedness and fund its other liquidity needs; Atento’s ability to comply with covenants contained in its debt instruments; the ability to obtain additional financing; the incurrence of significant additional indebtedness by Atento and its subsidiaries; and the ability of Atento’s lenders to fulfill their lending commitments. Atento is also subject to other risk factors described in documents filed by the company with the United States Securities and Exchange Commission. 

These forward-looking statements speak only as of the date on which the statements were made. Atento undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/atento-reports-fiscal-2020-third-quarter-results-301171370.html

SOURCE Atento S.A.

Posted on

Dye & Durham Announces $175 Million Bought Deal Offering of Common Shares


Not for distribution to U.S. news wire services or dissemination in the United States.

TORONTO, Nov. 11, 2020 (GLOBE NEWSWIRE) — Dye & Durham Limited (“Dye & Durham” or the “Company”) (TSX: DND) today announced that it has entered into an agreement with an underwriting syndicate led by Scotia Capital Inc., Canaccord Genuity Corp. and BMO Capital Markets (collectively, the “Underwriters”) to complete a new issue (the “Offering”), on a bought deal basis, of an aggregate of 8,600,000 common shares at a purchase price of C$20.35 per common share for aggregate gross proceeds of C$175 million.

The Company has also granted the Underwriters an over-allotment option, exercisable for a period of 30 days from the date of the closing of the Offering, to purchase up to an additional 15% of the aggregate common shares to be sold pursuant to the Offering.

The Company intends to use the net proceeds of the Offering to accelerate the Company’s growth initiatives, including future acquisitions, for working capital and general corporate purposes, and to reduce outstanding indebtedness, which was generally incurred in connection with prior acquisitions.

Closing of the Offering is expected to occur on or about November 25, 2020, or such other date as may be agreed upon by the Company and the Underwriters, subject to customary closing conditions, including required approvals of the Toronto Stock Exchange.

No securities regulatory authority has either approved or disapproved the contents of this press release. The common shares have not been, and will not be, registered under the United States Securities Act, of 1933, as amended (the “U.S. Securities Act”) or any state securities laws, and are being offered and sold in the United States only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the U.S. Securities Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the common shares in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About D
ye & Durham

Dye & Durham Limited is a leading provider of cloud-based software and technology solutions designed to improve efficiency and increase productivity for legal and business professionals. Dye & Durham provides critical information services and workflows, which clients use to manage their process, information and regulatory requirements. The Company has operations in Canada and the United Kingdom, and has a strong blue-chip customer base that includes law firms, financial service institutions, and government organizations

Additional information can be found at www.dyedurham.com.

Forward-looking
Statements

This press release
may contain forward-looking information
within the meanin
g of applicable securities laws,
which reflects the Company’s current expectations regarding future events. Forward-looking information is based on a number of assumption
s
and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward-looking information. Such risks and uncertainties include, but are not limited to, failure to complete the Offering
, and the factors
to be
discussed under “Risk Factors”
in the preliminary base shelf prospectus and
preliminary
prospectus supplement, when available. Dye & Durham does not undertake any obligation to update such forward-looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

For further information, please contact:

Adam Peeler
LodeRock Advisors Inc.
[email protected]
416.427.1235

Posted on

Parkland Corporation Announces November 2020 Dividend

CALGARY, Alberta, Nov. 11, 2020 (GLOBE NEWSWIRE) — Parkland Corporation (“Parkland”) (TSX:PKI) announces that a dividend of $0.1012 per share will be paid on December 15, 2020 to shareholders of record on November 20, 2020. The dividend will be an ‘eligible dividend’ for Canadian income tax purposes. The ex-dividend date is November 19, 2020.

E
nhanced Dividend Reinvestment Plan

Parkland’s enhanced Dividend Reinvestment Plan (“Enhanced DRIP”) allows shareholders to reinvest their cash dividends to purchase additional Parkland shares from treasury at a 5% per share discount to the average of the daily volume weighted average trading prices during the Pricing Period. For further details on the Enhanced DRIP and the Pricing Period, please visit www.parkland.ca/en/investors/dividends.

Shareholders who wish to enroll in the Enhanced DRIP must do so prior to the November 19, 2020 ex-dividend date to reinvest this month’s dividend in Parkland shares at a discount.

Use of Funds

The Enhanced DRIP allows Parkland to retain amounts that would otherwise be paid to shareholders as dividends in cash, thereby incrementally raising equity capital which may be used by Parkland to, among other things, fund its capital program, fund acquisitions, build new locations and upgrade existing locations: all of which help contribute to Parkland’s growth and ability to execute on its strategy.

Enrolling

Shareholders who own their shares through a brokerage and who wish to participate in the Enhanced DRIP should ensure they are enrolled by checking their online brokerage portal or by calling their investment advisor.

Shareholders who hold certificates in their own name (registered shareholders) who wish to enroll can find out more from Computershare by calling 1-800-564-6253.

Copies of the Plan and the enrollment form are also available on Parkland’s website at http://www.parkland.ca/en/investors/dividend/.

For investors previously enrolled in the Premium Dividend™ component of Parkland’s Dividend Reinvestment Plan, please note this program ended in April 2016 and without further action you are now likely receiving the regular dividend.

Brokerage entitlement and corporate actions departments are encouraged to ensure that they have properly elected with Clearing and Depository Services Inc. (“CDS”) those shares that should participate in the enhanced Dividend Reinvestment Plan.

Forward-Looking Statements

Certain statements contained in this news release constitute forward-looking information and statements (collectively, “forward looking statements”). When used in this news release, the words “expect’’, ‘‘will’’, ‘‘could’’, ‘‘would’’, “well positioned,” ‘‘pursue’’ and similar expressions are intended to identify forward-looking statements. In particular, this news release contains forward-looking statements with respect to, among other things, the uses by Parkland of the amount of cash dividends that are reinvested by shareholders in the Enhanced DRIP.

These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this news release should not be unduly relied upon. These forward-looking statements speak only as of the date of this news release. Parkland does not undertake any obligations to publicly update or revise any forward-looking statements except as required by securities laws. Actual results could differ materially from those anticipated in these forward-looking statements as a result of numerous risks and uncertainties including, but not limited to: failure to achieve the anticipated benefits of acquisitions, general economic, market and business conditions, industry capacity, competitive action by other companies, refining and marketing margins, the ability of suppliers to meet commitments, actions by governmental authorities and other regulators including increases in taxes, changes and developments in environmental and other regulations, and other factors, many of which are beyond the control of Parkland. See also the risks and uncertainties described under the headings “Cautionary Statement Regarding Forward-Looking Information” and “Risk Factors” in Parkland’s current Annual Information Form, and under the headings “Forward-Looking Information” and “Risk Factors” in Parkland’s Management’s Discussion and Analysis for the most recently completed financial period, each as filed on SEDAR and available on Parkland’s website at www.parkland.ca.

About Parkland Corporation

Parkland is an independent supplier and marketer of fuel and petroleum products and a leading convenience store operator. Parkland services customers across Canada, the United States, the Caribbean region and the Americas through three channels: Retail, Commercial and Wholesale. Parkland optimizes its fuel supply across these three channels by operating and leveraging a growing portfolio of supply relationships and storage infrastructure. Parkland provides trusted and locally relevant fuel brands and convenience store offerings in the communities it serves.

Parkland creates value for shareholders by focusing on its proven strategy of growing organically, realizing a supply advantage and acquiring prudently and integrating successfully. At the core of our strategy are our people, as well as our values of safety, integrity, community and respect, which are embraced across our organization.

FOR FURTHER INFORMATION

Investor Inquiries
Brad Monaco
Director, Capital Markets 
587-997-1447
[email protected]

Media Inquiries
Leroy McKinnon
Senior Specialist, Corporate Communications
403-567-2573
[email protected]

Posted on

LNG Industry Veteran Oscar Spieler Joins Delfin as Executive Chairman

LNG Industry Veteran Oscar Spieler Joins Delfin as Executive Chairman

HOUSTON–(BUSINESS WIRE)–
Today Delfin Midstream (“Delfin”) announced that Oscar Spieler has decided to join as Executive Chairman of the Board. Mr. Spieler has had a renowned executive career in the LNG, shipping, offshore energy, and green energy industries, including as CEO at Golar LNG (NASDAQ: GLNG), Frontline (NYSE: FRO) and Sea Production, and as Chairman of Quantafuel (QFUEL-ME). Mr. Spieler brings relevant expertise, having successfully led the development and execution of the first FLNG Vessel at Golar, delivering FLNG Hilli Episeyo under budget and putting it into commercial operation.

Delfin recently announced the completion of its FEED for a Newbuild FLNG vessel. The FEED results, together with the overall project development activities, enable the Company to execute the project for a total capital cost of around 550 $/tpa(1). The Company is also using its low-cost FLNG infrastructure and technology to develop additional projects in North America.

Commenting on his appointment, Oscar Spieler said: “Delfin has developed the most cost-efficient LNG export project in the continental U.S and combined with a FID threshold of just 2.0 to 2.5 mtpa makes Delfin unique in today’s challenging market. I am excited to join the Delfin team at this pivotal moment, as we take our next steps in bringing the project to FID. With the world transitioning to low-carbon energy over the coming decades, LNG is an undeniable part of the solution. The uniqueness of the Delfin cost structure, business model, technology and asset portfolio means we are capable of providing LNG buyers with low-carbon, low-cost solutions with significantly more commercial flexibility than land-based projects.”

Dudley Poston, CEO of Delfin, added: “We are delighted to welcome Oscar to the team. He brings a wealth of knowledge and expertise across the LNG value chain. Over the last decade Oscar has played key roles in the development of some of the most important innovations in the LNG industry: FLNG, merchant LNG shipping, FSRUs and small-scale LNG. Most importantly, he has demonstrated his success in ensuring the financing, commercialization, operations, execution and viability of each venture. Oscar’s experience and leadership will be invaluable as Delfin moves from the development phase to commercial operations.”

In 2018 Mr. Spieler joined Quantafuel as Chairman of the board, which in 2020 successfully started its first plastic-to-liquids plant and completed a successful IPO and private capital raise. Mr. Spieler has vast board experience both as chairman and/or director of multiple companies within the shipping, drilling and finance sectors, including Offshore Merchant Partners, Energy Drilling Ltd, Jasper Investments, Archer, Avenir LNG, North Atlantic Drilling and Sealift.

Mr. Spieler has a Master’s Degree in Naval Architecture and Engineering from the Norwegian University of Science and Technology. In addition to spending over 15 years in John Frederiksen’s Sea Tankers group of companies, Mr. Spieler spent 15 years at DNV in Norway and four years with Norwegian Tanker Operator Bergesen.

(1) Includes all costs up to start of commercial operations (incl. FLNG Vessel, disconnectable mooring system, pipeline connections, owner’s costs, transit, installation, commissioning, contingencies), excl. finance costs, on a nameplate capacity basis

About Delfin Midstream Inc.

Delfin Midstream Inc. (“Delfin”) is a leading LNG export infrastructure development company utilizing low-cost Floating LNG technology solutions. Delfin is the parent company of the Delfin LNG LLC (“Delfin LNG”) and Avocet LNG LLC. Delfin LNG is a brownfield Deepwater Port requiring minimal additional infrastructure investment to support up to four FLNG Vessels producing up to 13 million tonnes of LNG per annum. Delfin purchased the UTOS pipeline, the largest natural gas pipeline in the Gulf of Mexico, in 2014 and submitted its Deepwater Port license application in 2015. Delfin LNG received a positive Record of Decision from MARAD and approval from the Department of Energy for long-term exports of LNG to countries that do not have a Free Trade Agreement with the United States for up to 13 MTPA. Further information is available at www.delfinmidstream.com.

Dudley Poston, CEO, +1 713 824 1597

Wouter Pastoor, COO, +47 900 56 265

[email protected] or www.delfinmidstream.com

Media:

Dan Gagnier

Gagnier Communications

+1 646-569-5897

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: Other Professional Services Other Energy Oil/Gas Natural Resources Human Resources Energy Professional Services Other Natural Resources

MEDIA:

Posted on

Martinrea International Inc. Reports Record Third Quarter Results and Declares Dividend

TORONTO, Nov. 11, 2020 (GLOBE NEWSWIRE) — Martinrea International Inc. (TSX : MRE), a diversified and global automotive supplier engaged in the design, development and manufacturing of highly engineered, value-added Lightweight Structures and Propulsion Systems, today announced the release of its financial results for the third quarter ended September 30, 2020 and that it has declared a quarterly cash dividend of $0.05 per share.


HIGHLIGHTS

  • Total sales of $971 million; production sales of $933 million
  • Record third quarter fully diluted net earnings per share of $0.57
  • Quarterly adjusted operating income(1) margin of 7.8%, above year-ago levels
  • Balance sheet ended the quarter strong, with a reduction in net debt during the quarter of over $100 million
  • Production volumes recovering more quickly than expected following the industry-wide COVID-19 shutdowns earlier this year
  • Strong fourth quarter anticipated
  • Dividend of $0.05 per share declared


OVERVIEW

Pat D’Eramo, President and Chief Executive Officer, stated: “Our third quarter performance was a record for the Company, and much improved over the previous quarter, as industry production volumes recovered more quickly than previously expected following the COVID-19 shutdowns. Demand in our key North American market remains strong and vehicle inventories remain low, particularly on truck, SUV and CUV platforms, where we are more heavily weighted. Looking at other markets, demand in China remains strong, while Europe is recovering, albeit at a more gradual pace. Operationally, we continue to perform well, as evidenced by our strong operating income margin during the quarter, which came in at 7.8%, or over 9% excluding our recently-acquired Martinrea Metalsa Group. Our focus on lean and operational excellence paid off during the quarter and we thank the team for their efforts and dedication during these challenging times. We are looking forward to a strong fourth quarter, based on anticipated volumes as we see them today, as OEMs continue to replenish currently low vehicle inventory levels. We expect fourth quarter production sales in the range of $900 million to $1.0 billion, and adjusted net earnings per share (1) in the range of $0.46 to $0.54, including the recently-acquired assets from Metalsa, which has been a drag on earnings as we drive efficiencies, in particular in our new German facility. The integration of the newly-acquired business is going well and we expect its performance to improve as we execute on the roadmap in front of us. We are also happy to announce new business wins totalling $70 million in annualized sales, including $45 million in Propulsion Systems for FCA and General Motors, $10 million in lightweight structures for electric vehicle platforms with General Motors, and $15 million for a battery box for Volvo’s heavy-duty truck in our Industrial group. We are seeing the highest level of quoting activity in our Industrial Group since my time at Martinrea, and we see opportunities to grow this business. We also expect to see our first product with graphene in production in 2021, a graphene-enhanced brake line for one of our OEM customers. Our customer has tested and approved the product and is working with us to convert current production from standard brake lines to the more durable graphene-enhanced brake lines. We are big proponents of graphene and its potential applications, and we intend to capitalize on this potential through our investment in NanoXplore.”

Fred Di Tosto, Chief Financial Officer, stated: “We experienced a sharp rebound in our financial results during the third quarter, as the Company and our industry recovered following the COVID-19 shutdowns.   Volumes were strong during the quarter and operating margins were above year-ago levels, driven by strength in our North American operations, reflective of volume and a positive sales mix, operating cost reductions, lower tooling sales and some benefit from government wage subsidies. Third quarter production sales, excluding the newly-acquired Martinrea Metalsa operations, were approximately flat year-over-year, with adjusted operating income(1) coming in at $75.6 million, up 9.4% year-over-year. We generated strong free cash flow (1) during the quarter, which resulted in a reduction in net debt of over $100.0 million. Our net debt to adjusted EBITDA(1) ratio ended the quarter at 2.21x, and approximately 1.70x for bank covenant purposes, given the agreement we reached with our banking syndicate to eliminate Q2 adjusted EBITDA(1) from the covenant calculation. We believe we entered the COVID-19 driven downturn with a strong balance sheet which has ultimately allowed us to navigate our way through the COVID crisis with confidence. Our net debt at the end of the third quarter was essentially back to pre-COVID levels and we funded an acquisition during that time. A very good result from all accounts and reflective of the strength of the business. Overall, we are very pleased with our third quarter results. To be able to post year-over-year growth in adjusted operating income (1), adjusted net earnings per share (1), and free cash flow (1) in the middle of a pandemic is an achievement of which we are all proud.”

Rob Wildeboer, Executive Chairman, stated: “From a macro perspective, our industry is recovering from the longest shutdown in its history at a pace few of us would have expected only a few short months ago. North American auto sales have now recovered close to pre-COVID volumes and are now at a sustainable level based on previous cycles. Strong demand, coupled with low inventories, sets the stage for a continued recovery in production in the months and years ahead. We believe some interesting trends are emerging that could support vehicle demand well into the future, including the perception of the vehicle as a safe, self-contained method of transportation, and an increase in demand for living space outside of large metropolitan areas. Overall, we think our future is bright, and not just from an industry recovery perspective. More importantly, we are an innovative company that invests in and develops leading-edge technology, as evidenced by our relationship with NanoXplore and development of new products, including graphene-enhanced brake lines. Our focus on innovation and our operational strength has enabled us to emerge from the COVID-19 crisis as a stronger and more competitive company. It’s in times like these that our focus on culture and our vision of making people’s lives better by being the best we can be in the products we make and the services we provide comes through for us. We want to thank our dedicated employees for their great service, as well as our shareholders, lenders, suppliers, customers and governments for their hard work and support.”


RESULTS OF OPERATIONS

All amounts in this press release are in Canadian dollars, unless otherwise stated; and all tabular amounts are in thousands of Canadian dollars, except earnings per share and number of shares. 

Additional information about the Company, including the Company’s Management Discussion and Analysis of Operating Results and Financial Position for the third quarter ended September 30, 2020 (“MD&A”), the Company’s interim condensed consolidated financial statements for the third quarter ended September 30, 2020 (the “interim financial statements”) and the Company’s Annual Information Form for the year ended December 31, 2019, can be found at www.sedar.com.


OVERALL RESULTS

Results of operations may include certain unusual and other items that have been separately disclosed, where appropriate, in order to provide a clear assessment of the underlying Company results. In addition to IFRS measures, management uses non-IFRS measures in the Company’s disclosures that it believes provide the most appropriate basis on which to evaluate the Company’s results.

The following tables set out certain highlights of the Company’s performance for the three and nine months ended September 30, 2020 and 2019. Refer to the Company’s interim financial statements for the three and nine months ended September 30, 2020 for a detailed account of the Company’s performance for the periods presented in the tables below.

    Three months ended September 30, 2020   Three months ended September 30, 2019 $ Change % Change
Sales $ 971,060   $ 974,384   (3,324 ) (0.3 %)
Gross Margin   151,478     143,901   7,577   5.3 %
Operating Income   75,562     73,243   2,319   3.2 %
Net Income for the period   45,636     46,678   (1,042 ) (2.2 %)
Net Earnings per Share – Basic $ 0.57   $ 0.57   –   –  
Net Earnings per Share – Diluted $ 0.57   $ 0.56   0.01   1.8 %

Non-IFRS Measures*
 		           
Adjusted Operating Income $ 75,562   $ 69,044   6,518   9.4 %
% of Sales   7.8 %   7.1 %    
Adjusted EBITDA   134,232     122,401   11,831   9.7 %
% of Sales   13.8 %   12.6 %    
Adjusted Net Income   45,636     43,507   2,129   4.9 %
Adjusted Net Earnings per Share – Basic and Diluted $ 0.57   $ 0.53   0.04   7.5 %

    Nine months ended September 30, 2020   Nine months ended September 30, 2019 $ Change % Change
Sales $ 2,304,330   $ 2,946,078   (641,748 ) (21.8 %)
Gross Margin   259,256     456,180   (196,924 ) (43.2 %)
Operating Income (Loss)   (38,598 )   214,008   (252,606 ) (118.0 %)
Net Income (Loss) for the period   (72,287 )   130,068   (202,355 ) (155.6 %)
Net Earnings (Loss) per Share – Basic $ (0.90 ) $ 1.57   (2.47 ) (157.3 %)
Net Earnings (Loss) per Share – Diluted $ (0.90 ) $ 1.56   (2.46 ) (157.7 %)

Non-IFRS Measures*
 		           
Adjusted Operating Income $ 57,844   $ 236,476   (178,632 ) (75.5 %)
% of Sales   2.5 %   8.0 %    
Adjusted EBITDA   233,779     394,021   (160,242 ) (40.7 %)
% of Sales   10.1 %   13.4 %    
Adjusted Net Income   2,644     153,853   (151,209 ) (98.3 %)
Adjusted Net Earnings per Share – Basic $ 0.03   $ 1.86   (1.83 ) (98.4 %)
Adjusted Net Earnings per Share – Diluted $ 0.03   $ 1.85   (1.82 ) (98.4 %)

*

Non-IFRS Measures

The Company prepares its financial statements in accordance with International Financial Reporting Standards (“IFRS”). However, the Company considers certain non-IFRS financial measures as useful additional information in measuring the financial performance and condition of the Company. These measures, which the Company believes are widely used by investors, securities analysts and other interested parties in evaluating the Company’s performance, do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similarly titled measures presented by other publicly traded companies, nor should they be construed as an alternative to financial measures determined in accordance with IFRS. Non-IFRS measures include “Adjusted Net Income”, “Adjusted Net Earnings per Share (on a basic and diluted basis)”, “Adjusted Operating Income”, “Adjusted EBITDA”, “Free Cash Flow” and “Net Debt”. Please refer to the Company’s previously filed annual and interim MD&A of operating results and financial position for the fiscal year 2019 for a full reconciliation of IFRS to non-IFRS measures.

The following tables provide a reconciliation of IFRS “Net Income (Loss)” to Non-IFRS “Adjusted Net Income”, “Adjusted Operating Income” and “Adjusted EBITDA”.

    Three months ended September 30, 2020   Three months ended September 30, 2019
Net Income $ 45,636   $ 46,678  
Unusual and Other Items (after-tax)*   –     (3,171 )
Adjusted Net Income $ 45,636   $ 43,507  
         
    Nine months ended September 30, 2020   Nine months ended September 30, 2019
Net Income (Loss) $ (72,287 ) $ 130,068  
Unusual and Other Items (after-tax)*   74,931     23,785  
Adjusted Net Income $ 2,644   $ 153,853  
*Unusual and other items are explained in the “Adjustments to Net Income” section of this
Press Release

    Three months ended September 30, 2020     Three months ended September 30, 2019
Net Income $ 45,636   $ 46,678  
Income tax expense   18,636     16,129  
Other finance expense – excluding Unusual and Other Items*   1,852     844  
Share of loss of an associate   300     818  
Finance expense   9,138     9,345  
Unusual and Other Items (before-tax)*   –     (4,770 )
Adjusted Operating Income $ 75,562   $ 69,044  
Depreciation of property, plant and equipment and right-of-use assets   55,237     50,200  
Amortization of intangible assets   3,196     4,104  
Loss (gain) on disposal of property, plant and equipment   237     (947 )
Adjusted EBITDA $ 134,232   $ 122,401  

    Nine months ended September 30, 2020   Nine months ended September 30, 2019
Net Income (Loss) $ (72,287 ) $ 130,068  
Income tax expense (benefit)   (86 )   52,156  
Other finance expense – excluding Unusual and Other Items*   5,008     1,130  
Share of loss of an associate   1,881     1,330  
Finance expense   26,886     29,085  
Unusual and Other Items (before-tax)*   96,442     22,707  
Adjusted Operating Income $ 57,844   $ 236,476  
Depreciation of property, plant and equipment and right-of-use assets   166,044     146,931  
Amortization of intangible assets   9,654     11,820  
Loss (gain) on disposal of property, plant and equipment   237     (1,206 )
Adjusted EBITDA $ 233,779   $ 394,021  
*Unusual and other items are explained in the “Adjustments to Net Income” section of this
Press Release


SALES
 		           
             

Three months ended September 30, 2020 to three months ended September 30, 2019 comparison
             
    Three months ended September 30, 2020   Three months ended September 30, 2019 $ Change % Change
North America $ 739,489   $ 780,989   (41,500 ) (5.3 %)
Europe   189,366     157,736   31,630   20.1 %
Rest of the World   46,999     37,727   9,272   24.6 %
Eliminations   (4,794 )   (2,068 ) (2,726 ) 131.8 %
Total Sales $ 971,060   $ 974,384   (3,324 ) (0.3 %)

The Company’s consolidated sales for the third quarter of 2020 decreased by $3.3 million or 0.3% to $971.1 million as compared to $974.4 million for the third quarter of 2019. The total decrease in sales was driven by a year-over-year decrease in North America, partially offset by increases in the Europe and Rest of the World operating segments.

Sales for the third quarter of 2020 in the Company’s North America operating segment decreased by $41.5 million or 5.3% to $739.5 million from $781.0 million for the third quarter of 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $29.7 million of year-over-year sales (including $0.4 million in tooling sales) to the North America operating segment. Excluding the acquired operations, third quarter sales in North America decreased year-over-year by $71.2 million or 9.1%. This decrease was due to a decrease in tooling sales of $100.3 million, which are typically dependent on the timing of tooling construction and final acceptance by the customer; partially offset by higher production volumes on General Motors pick-up truck and large SUV platform, which was negatively impacted by the United Auto Workers strike at General Motors during the third quarter of 2019, the continued production of ventilator stands for General Motors, and the impact of foreign exchange on the translation of U.S.-denominated production sales, which had a positive impact on overall sales for the third quarter of 2020 of approximately $11.8 million as compared to the third quarter of 2019. Overall third quarter OEM light vehicle production in North America was essentially flat year-over-year, despite the COVID-19 global pandemic.

Sales for the third quarter of 2020 in the Company’s Europe operating segment increased by $31.6 million or 20.1% to $189.4 million from $157.7 million for the third quarter of 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $53.5 million of year-over-year sales (including $5.8 million in tooling sales) to the Europe operating segment. Excluding the acquired operations, third quarter sales in Europe decreased year-over-year by $21.9 million or 13.9%. This decrease was due to overall lower industry volumes, primarily as a result of the COVID-19 pandemic; partially offset by an $8.4 million increase in tooling sales, and a $4.9 million positive foreign exchange impact from the translation of Euro-denominated production sales as compared to the third quarter of 2019.

Sales for the third quarter of 2020 in the Company’s Rest of the World operating segment increased by $9.3 million or 24.6% to $47.0 million from $37.7 million for the third quarter of 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $21.7 million of year-over-year sales to the Rest of the World operating segment. Excluding the acquired operations, third quarter sales in the Rest of the World decreased year-over-year by $12.4 million or 32.9%. This decrease was largely driven by lower year-over-year production volumes on the Cadillac CT6 vehicle platform in China, a $4.3 million decrease in tooling sales, and a $1.8 million negative foreign exchange impact from the translation of foreign-denominated production sales as compared to the third quarter of 2019.

Overall tooling sales, inclusive of the operations acquired from Metalsa, decreased by $90.0 million to $37.8 million for the third quarter of 2020 from $127.8 million for the third quarter of 2019.


Nine months ended September 30, 2020 to nine months ended September 30, 2019 comparison
             
    Nine months ended September 30, 2020   Nine months ended September 30, 2019 $ Change % Change
North America $ 1,745,151   $ 2,346,167   (601,016 ) (25.6 %)
Europe   449,251     513,742   (64,491 ) (12.6 %)
Rest of the World   120,665     91,526   29,139   31.8 %
Eliminations   (10,737 )   (5,357 ) (5,380 ) 100.4 %
Total Sales $ 2,304,330   $ 2,946,078   (641,748 ) (21.8 %)

The Company’s consolidated sales for the nine months ended September 30, 2020 decreased by $641.7 million or 21.8% to $2,304.3 million as compared to $2,946.1 million for the nine months ended September 30, 2019. The total decrease in sales was driven by decreases in the North America and Europe operating segments, partially offset by an increase in sales in the Rest of the World.

Sales for the nine months ended September 30, 2020 in the Company’s North America operating segment decreased by $601.1 million or 25.6% to $1,745.2 million from $2,346.2 million for the nine months ended September 30, 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $47.7 million of year-over-year sales (including $1.7 million in tooling sales) to the North America operating segment. Excluding the acquired operations, sales for the nine months ended September 30, 2020 in North America decreased year-over-year by $648.8 million or 27.7%. This decrease was due to overall lower industry volumes, primarily as a result of the impact of the COVID-19 pandemic, and a decrease in tooling sales of $152.6 million, which are typically dependent on the timing of tooling construction and final acceptance by the customer. These negative factors were partially offset by the impact of foreign exchange on the translation of U.S.-denominated production sales, which had a positive impact on overall sales for the nine months ended September 30, 2020 of approximately $23.0 million as compared to the corresponding period of 2019, and the launch of new programs during or subsequent to the nine months ended September 30, 2019, including the General Motors heavy duty truck, and the production of ventilator stands for General Motors.

Sales for the nine months ended September 30, 2020 in the Company’s Europe operating segment decreased by $64.5 million or 12.6% to $449.3 million from $513.7 million for the nine months ended September 30, 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $98.8 million of year-over-year sales (including $9.7 million in tooling sales) to the Europe operating segment. Excluding the acquired operations, sales for the nine months ended September 30, 2020 in Europe decreased year-over-year by $163.3 million or 31.8%. This decrease can be attributed to overall lower industry volumes, primarily as a result of the impact of the COVID-19 pandemic; lower pre-COVID year-over-year production related to certain light vehicle platforms, in particular with Daimler and Jaguar Land Rover; and a $2.8 million decrease in tooling sales. These negative factors were partially offset by the launch of new programs during or subsequent to the nine months ended September 30, 2019, namely an aluminum transmission for Volkswagen; and a $1.3 million positive foreign exchange impact from the translation of Euro-denominated production sales as compared to the corresponding period of 2019.

Sales for the nine months ended September 30, 2020 in the Company’s Rest of the World operating segment increased by $29.1 million or 31.8% to $120.7 million from $91.5 million for the nine months ended September 30, 2019. The operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, contributed $48.8 million of year-over-year sales to the Rest of the World operating segment. Excluding the acquired operations, sales for the nine months ended September 30, 2020 in the Rest of the World decreased year-over-year by $19.7 million or 21.5%. This decrease was largely driven by COVID-19 related disruption, lower year-over-year production volumes on the Cadillac CT6 vehicle platform in China, a $3.9 million negative foreign exchange impact from the translation of foreign-denominated production sales as compared to the corresponding period of 2019, and a $0.4 million decrease in tooling sales.

Overall tooling sales, inclusive of the operations acquired from Metalsa, decreased by $144.4 million to $129.8 million for the nine months ended September 30, 2020 from $274.2 million for the nine months ended September 30, 2019.


GROSS MARGIN
 		           
             

Three months ended September 30, 2020 to three months ended September 30, 2019 comparison
             
    Three months ended September 30, 2020   Three months ended September 30, 2019 $ Change % Change
Gross margin $ 151,478   $ 143,901   7,577 5.3 %
% of Sales   15.6 %   14.8 %    

The gross margin percentage for the third quarter of 2020 of 15.6% increased as a percentage of sales by 0.8% as compared to the gross margin percentage for the third quarter of 2019 of 14.8%. The increase in gross margin as a percentage of sales was generally due to a decrease in tooling sales which typically earn low margins for the Company; a positive sales mix; productivity and efficiency improvements at certain operating facilities; and the receipt of certain COVID-related government wage subsidies. These positive factors were partially offset by a negative impact on overall margin percentage from the operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020, and operational inefficiencies and other costs at certain facilities including upfront costs incurred in preparation of upcoming new programs.


Nine months ended September 30, 2020 to nine months ended September 30, 2019 comparison
             
    Nine months ended September 30, 2020   Nine months ended September 30, 2019 $ Change % Change
Gross margin $ 259,256   $ 456,180   (196,924 ) (43.2 %)
% of Sales   11.3 %   15.5 %    

The gross margin percentage for the nine months ended September 30, 2020 of 11.3% decreased as a percentage of sales by 4.2% as compared to the gross margin percentage for the nine months ended September 30, 2019 of 15.5%. The decrease in gross margin as a percentage of sales was generally due to overall lower sales volume and corresponding lower utilization of assets, driven primarily by the impact of the COVID-19 pandemic; a negative impact on overall margin percentage from the operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020; and operational inefficiencies and other costs at certain facilities including upfront costs incurred in preparation of upcoming new programs. These negative factors were partially offset by productivity and efficiency improvements at certain operating facilities; the receipt of certain COVID-related government wage subsidies; and a decrease in tooling sales, which typically earn low margins for the Company. The sharp sales decline in April and May, as a result of the COVID-19 related shutdowns, coupled with a volatile restart and ramp-up of production in May and June with limited predictability had a significant impact on gross margin during the second quarter of 2020, despite major reductions in costs.


ADJUSTMENTS TO NET INCOME (LOSS)

Adjusted Net Income (Loss) excludes certain unusual and other items, as set out in the following tables and described in the notes thereto. Management uses Adjusted Net Income (Loss) as a measurement of operating performance of the Company and believes that, in conjunction with IFRS measures, it provides useful information about the financial performance and condition of the Company.


TABLE A
         

Three months ended September 30, 2020 to three months ended September 30, 2019 comparison
 		 
         
  Three months ended   Three months ended  
  September 30, 2020   September 30, 2019 (a)-(b)
  (a)   (b) Change
         
NET INCOME (A) $ 45,636   $ 46,678   $ (1,042 )
         
Add Back – Unusual and Other Items:        
         
Gain on derivative instruments (4)   –     (571 )   571  
Net gain in the Company’s operating facility in Brazil (5)   –     (4,199 )   4,199  
         
         
TOTAL UNUSUAL AND OTHER ITEMS BEFORE TAX   –   $ (4,770 ) $ 4,770  
         
Tax impact of above items   –     1,599     (1,599 )
         
         
TOTAL UNUSUAL AND OTHER ITEMS – AFTER TAX (B)   –   $ (3,171 ) $ 3,171  
         
         
ADJUSTED NET INCOME (A + B) $ 45,636   $ 43,507   $ 2,129  
         
         
Number of Shares Outstanding – Basic (‘000)   80,189     82,593    
Adjusted Basic Net Earnings Per Share $ 0.57   $ 0.53    
Number of Shares Outstanding – Diluted (‘000)   80,200     82,713    
Adjusted Diluted Net Earnings Per Share $ 0.57   $ 0.53    
         


TABLE B
         

Nine months ended September 30, 2020 to nine months ended September 30, 2019 comparison
 		     
         
  Nine months ended


 		  Nine months ended


 		 
  September 30, 2020   September 30, 2019 (a)-(b)
  (a)   (b) Change
         
NET INCOME (LOSS) (A) $ (72,287 )   $ 130,068   $ (202,355 )
         
Add Back – Unusual and Other Items:        
         
Transaction costs associated with the business acquired from Metalsa (recorded as SG&A) (1)   2,489       –     2,489  
Impairment of assets (2)   85,783       18,502     67,281  
Restructuring costs (3)   8,170       8,165     5  
Loss on derivative instruments (4)   –       239     (239 )
Net gain in the Company’s operating facility in Brazil (5)   –       (4,199 )   4,199  
         
         
         
TOTAL UNUSUAL AND OTHER ITEMS BEFORE TAX $ 96,442     $ 22,707   $ 73,735  
         
Tax impact of above items   (21,511 )     1,078     (22,589 )
         
         
TOTAL UNUSUAL AND OTHER ITEMS – AFTER TAX (B) $ 74,931     $ 23,785   $ 51,146  
         
ADJUSTED NET INCOME (A + B) $ 2,644     $ 153,853   $ (151,209 )
         
Number of Shares Outstanding – Basic (‘000)   80,090       82,897    
Adjusted Basic Net Earnings Per Share $ 0.03     $ 1.86    
Number of Shares Outstanding – Diluted (‘000)   80,090       83,054    
Adjusted Diluted Net Earnings Per Share $ 0.03     $ 1.85    
         

(1)   Transaction costs associated with the operations acquired from Metalsa (recorded as SG&A)

On March 2, 2020, the Company completed the acquisition of the structural components for passenger car operations of Metalsa S.A, de C.V. Included in SG&A expense are transaction costs related to the acquisition totaling $nil and $2.5 million for the three and nine months ended September 30, 2020, respectively.

(2)   Impairment of assets

The significant reduction in volumes and industry production projections as a result of the COVID-19 global pandemic has negatively impacted the recoverable amount of certain of the Company’s production-related assets and has also changed the expected usage of certain other assets. As a result, during the second quarter of 2020, the Company completed an analysis of its asset base and concluded there existed certain indicators of impairment for specific assets and cash-generating units (CGUs). Accordingly, the Company tested these assets and CGUs for recoverability using projected sales and cash flows modelled from industry production projections. Based on the results of this testing, during the second quarter of 2020, the Company recorded impairment charges on property, plant and equipment, right-of-use assets, intangible assets and inventories across its three operating segments totaling $85.8 million, including specific assets that are no longer expected to be redeployed or transferred to other facilities. The charges related to assets and CGUs across various jurisdictions in the Company’s segments, including the United States, Slovakia, China and Brazil. Of the total impairment charge, $72.2 million was recognized in North America, $1.3 million in Europe, and $12.3 million in the Rest of the World. For the specific assets that are no longer expected to be redeployed or transferred, the impairment charges are based on the estimated salvage value of the assets. For the CGUs, the impairment charges were recorded where the carrying amount of the CGUs exceeded their estimated recoverable amounts.

During the second quarter of 2019, the Company recorded impairment charges on property, plant, equipment, right-of-use assets, intangible assets and inventories totaling $18.5 million related to an operating facility in China included in the Rest of the World operating segment. The impairment charges resulted from lower OEM production volumes on certain light vehicle platforms being serviced by the facility, representing a significant portion of the business, causing the Company to complete an analysis of strategic alternatives. The impairment charges were recorded where the carrying amount of the assets exceeded their estimated recoverable amounts, including consideration for where specific assets can be transferred to other facilities.

(3)   Restructuring costs

Additions to the restructuring provision, recognized during the second quarter of 2020, totaled $8.2 million and represent employee-related severance resulting from a reduction in the Company’s workforce globally in response to the COVID-19 global pandemic. Of the total addition to the restructuring provision, $6.6 million relates to North America, $1.0 million to Europe and $0.6 million to the Rest of the World.

Additions to the restructuring provision, recognized during the second quarter of 2019, totaled $8.2 million and represent employee-related severance resulting from the right-sizing of operating facilities in the North America ($1.7 million) and Rest of the World ($6.5 million) operating segments.

(4)   Loss (gain)
on derivative instruments

Martinrea held warrants in NanoXplore Inc., a publicly listed graphene company on the TSX Venture Exchange under the ticker symbol GRA. The warrants represented derivative instruments and were fair valued at the end of each reporting period using the Black-Scholes-Merton valuation model, with the change in fair value recorded through profit or loss. Based on the fair value of the outstanding warrants as at September 30, 2019, a gain of $0.6 million was recognized for the three months ended September 30, 2019 and a loss of $0.2 million was recognized for the nine months ended September 30, 2019. All outstanding remaining warrants in NanoXplore expired in March 2020 unexercised.

(5)   Net gain in the Company’s operating facility in Brazil

Included in income for the three months ended September 30, 2019 is a non-recurring benefit recognized in the Company’s operating facility in Brazil, included in the Rest of World operating segment. The benefit represents a $6.5 million recovery of previously paid local social security taxes, partially offset by a $2.3 million true-up of the facility’s claims and litigation provision related to certain employee-related matters. The benefit was recorded against selling, general and administrative expense.


NET INCOME (LOSS)
 
               

Three months ended September 30, 2020 to three months ended September 30, 2019 comparison
               
    Three months ended September 30, 2020     Three months ended September 30, 2019 $ Change % Change
Net Income $ 45,636   $ 46,678 (1,042 ) (2.2 %)
Adjusted Net Income $ 45,636   $ 43,507 2,129   4.9 %
Net Earnings per Share              
Basic $ 0.57   $ 0.57    
Diluted $ 0.57   $ 0.56    
Adjusted Net Earnings per Share              
Basic and Diluted $ 0.57   $ 0.53    

Net income, before adjustments, for the third quarter of 2020 decreased by $1.0 million to $45.6 million from $46.7 million for the third quarter of 2019. The slight decrease was due largely to the unusual and other items recognized during the third quarter of 2019 as explained in Table A under “Adjustments to Net Income (Loss)”. Excluding these unusual and other items, adjusted net income for the third quarter of 2020 increased by $2.1 million to $45.6 million or $0.57 per share, on a basic and diluted basis, from $43.5 million or $0.53 per share, on a basic and diluted basis, for the third quarter of 2019.

Adjusted Net Income for the third quarter of 2020, as compared to the third quarter of 2019, was positively impacted by the following:

  • higher gross profit on essentially flat year-over-year sales as previously explained; and
  • a year-over-year decrease in research and development costs due primarily to a decrease in new product and process research and development activity in light of the COVID-19 pandemic.

These factors were partially offset by the following:

  • negative third quarter results from the operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020;
  • a year-over-year increase in SG&A expense, excluding adjustments, as previously explained; and
  • a higher effective tax rate on adjusted income due generally to the mix of earnings stemming from the addition of the assets acquired from Metalsa (29.0% for the third quarter of 2020 compared to 25.0% for the third quarter of 2019).

Nine months ended September 30, 2020 to nine months ended September 30, 2019 comparison
             
    Nine months ended September 30, 2020   Nine months ended September 30, 2019 $ Change % Change
Net Income (Loss) $ (72,287 ) $ 130,068 (202,355 ) (155.6 %)
Adjusted Net Income $ 2,644   $ 153,853 (151,209 ) (98.3 %)
Net Earnings (Loss) per Share            
Basic $ (0.90 ) $ 1.57    
Diluted $ (0.90 ) $ 1.56    
Adjusted Net Earnings per Share            
Basic $ 0.03   $ 1.86    
Diluted $ 0.03   $ 1.85    

Net Income (Loss), before adjustments, for the nine months ended September 30, 2020 decreased by $202.4 million to a net loss of $72.3 million from net income of $130.1 million for the nine months ended September 30, 2019 due to the lower year-over-year sales volume, due primarily to the impact of the COVID-19 pandemic, and certain unusual and other items incurred during the nine months ended September 30, 2020 and 2019 as explained in Table B under “Adjustments to Net Income (Loss)”. Excluding these unusual and other items, adjusted net income for the nine months ended September 30, 2020 decreased to $2.6 million or $0.03 per share, on a basic and diluted basis, from $153.9 or $1.86, on a basic basis, and $1.85 on a diluted basis, for the nine months ended September 30, 2019.

Adjusted Net Income for the nine months ended September 30, 2020, as compared to the nine months ended September 30, 2019, was negatively impacted by the following:

  • lower gross profit on lower year-over-year sales volume, as previously explained, due primarily to the impact of the COVID-19 pandemic;
  • negative year-to-date results from the operations acquired from Metalsa, results for which were consolidated with those of the Company effective March 2, 2020;
  • a net unrealized foreign exchange loss of $5.2 million for the nine months ended September 30, 2020 compared to a loss of $1.5 million for the nine months ended September 30, 2019; and
  • a higher effective tax rate on adjusted income due generally to the mix of earnings and tax impacts of the unusual and other items explained in Table B under “Adjustments to Net Income (Loss)” (89.0% for the nine months ended September 30, 2020 compared to 24.9% for the nine months ended September 30, 2019).

These factors were partially offset by the following:

  • a year-over-year decrease in SG&A expense, as previously discussed;
  • a year-over-year decrease in research and development costs due primarily to a decrease in new product and process research and development activity in light of the COVID-19 pandemic; and
  • a year-over-year decrease in finance expense on the Company’s long-term debt primarily as a result of lower borrowing rates.


DIVIDEND

A cash dividend of $0.05 per share has been declared by the Board of Directors payable to shareholders of record on December 31, 2020, on or about January 15, 2021.


ABOUT MARTINREA

Martinrea is a diversified and global automotive supplier engaged in the design, development and manufacturing of highly engineered, value-added Lightweight Structures and Propulsion Systems.

Martinrea operates in 57 locations in Canada, the United States, Mexico, Brazil, Germany, Slovakia, Spain, China, South Africa and Japan. Martinrea’s vision is making lives better by being the best supplier we can be in the products we make and the services we provide. For more information on Martinrea, please visit www.martinrea.com. Follow Martinrea on Twitter and Facebook.


CONFERENCE CALL DETAILS

A conference call to discuss the financial results will be held on Wednesday, November 11, 2020 at 5:30 p.m. (Toronto time) which can be accessed by dialing 416-641-6104 or toll free 800-952-5114 (participant code 4636275#). Please call 10 minutes prior to the start of the conference call.

A webcast of the Q3 slide presentation will be available in listen-only mode at the following link https://bell.media-server.com/mmc/p/c5aq96dh beginning at 5:30 p.m. (Toronto time). Please note that to participate in the question and answer session, the dial in numbers and participant code must be used.

There will also be a rebroadcast of the call available by dialing 905-694-9451 or toll free 800-408-3053 (conference id –4851137#). The rebroadcast will be available until December 5, 2020. The webcast presentation will be available for replay on the Martinrea website.

If you have any teleconferencing questions, please call Ganesh Iyer at 416-749-0314.


FORWARD-LOOKING INFORMATION



Special Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of applicable Canadian securities laws including statements related to the growth or expectations of, improvements in, expansion of and/or guidance or outlook as to future revenue, sales, margin, gross margin, earnings, and earnings per share, adjusted earnings per share, adjusted net earnings per share, operating income margins, operating margins, adjusted operating income margins, volumes, the strength of the fourth quarter 2020 and future growth; the recovery of the automotive industry and various markets, emerging trends that could support vehicle demand; the strength of the Company, including post-COVID-19; anticipated program wins, pursuit of its strategies (including investing in and growing the business, including the industrial business; expected production in 2021 of a product with graphene; the intention to capitalize on the NanoXplore investment); the integration and expected performance of the assets acquired from Metalsa; the payment of dividends as well as other forward-looking statements. The words “continue”, “expect”, “anticipate”, “estimate”, “may”, “will”, “should”, “views”, “intend”, “believe”, “plan”, “outlook” and similar expressions are intended to identify forward-looking statements. Forward-looking statements are based on estimates and assumptions made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors that the Company believes are appropriate in the circumstances, such as expected sales and industry production estimates, current foreign exchange rates (FX), timing of product launches and operational improvements during the period and current Board approved budgets. Certain forward-looking financial assumptions are presented as non-IFRS information, and we do not provide reconciliation to IFRS for such assumptions. Many factors could cause the Company’s actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the following factors, some of which are discussed in detail in the Company’s most recent Management Discussion and Analysis and Annual Information Form and other public filings which can found at www.sedar.com:

  • North American and global economic and political conditions and epidemics or pandemics;
  • the highly cyclical nature of the automotive industry and the industry’s dependence on consumer spending and general economic conditions;
  • the Company’s dependence on a limited number of significant customers;
  • financial viability of suppliers;
  • the Company’s reliance on critical suppliers and on suppliers for components and the risk that suppliers will not be able to supply components on a timely basis or in sufficient quantities;
  • competition;
  • the increasing pressure on the Company to absorb costs related to product design and development, engineering, program management, prototypes, validation and tooling;
  • increased pricing of raw materials and commodities;
  • outsourcing and insourcing trends;
  • the risk of increased costs associated with product warranty and recalls together with the associated liability;
  • product development and technological change;
  • the Company’s ability to enhance operations and manufacturing techniques;
  • dependence on key personnel;
  • limited financial resources/uncertainty of future financing/banking;
  • risks associated with the integration of acquisitions;
  • risks associated with private or public investment in technology companies;
  • the risks associated with joint ventures;
  • costs associated with rationalization of production facilities;
  • launch and operational costs;
  • labour relations matters;
  • trade restrictions;
  • changes in governmental regulations or laws including any changes to trade;
  • litigation and regulatory compliance and investigations;
  • quote and pricing assumptions;
  • currency risk;
  • fluctuations in operating results;
  • internal controls over financial reporting and disclosure controls and procedures;
  • environmental regulation and climate change;
  • the impact of climate, political, social and economic risks, natural disasters and pandemics in the countries in which we operate or sell to, or from which we source production;
  • a shift away from technologies in which the Company is investing;
  • competition with low cost countries;
  • the Company’s ability to shift its manufacturing footprint to take advantage of opportunities in emerging markets;
  • risks of conducting business in foreign countries, including China, Brazil and other markets;
  • potential tax exposures;
  • a change in the Company’s mix of earnings between jurisdictions with lower tax rates and those with higher tax rates, as well as the Company’s ability to fully benefit from tax losses;
  • under-funding of pension plans;
  • the cost of post-employment benefits;
  • impairment charges;
  • cybersecurity threats;
  • the potential volatility of the Company’s share price; and
  • dividends.

These factors should be considered carefully, and readers should not place undue reliance on the Company’s forward-looking statements. The Company has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

The common shares of Martinrea trade on The Toronto Stock Exchange under the symbol “MRE”.

For further information, please contact:

Fred Di Tosto
Chief Financial Officer
Martinrea International Inc.
3210 Langstaff Road
Vaughan, Ontario L4K 5B2

Tel: 416-749-0314
Fax: 289-982-3001

___________________________________

1 The Company prepares its financial statements in accordance with International Financial Reporting Standards (“IFRS”). However, the Company considers certain non-IFRS financial measures as useful additional information in measuring the financial performance and condition of the Company. These measures, which the Company believes are widely used by investors, securities analysts and other interested parties in evaluating the Company’s performance, do not have a standardized meaning prescribed by IFRS and therefore may not be comparable to similarly titled measures presented by other publicly traded companies, nor should they be construed as an alternative to financial measures determined in accordance with IFRS. Non-IFRS measures include “Adjusted Net Income”, “Adjusted Net Earnings per Share (on a basic and diluted basis)”, “Adjusted Operating Income”, “Adjusted EBITDA”, “Free Cash Flow” and “Net Debt”. A reconciliation of certain non-IFRS financial measures to measures determined in accordance with IFRS are contained in the Company’s Management Discussion and Analysis for the third quarter ended September 30, 2020.

 

Martinrea International Inc.
Interim Condensed Consolidated Balance Sheets 
(in thousands of Canadian dollars) (unaudited)     
               
               
  Note   September 30, 2020


 		  December 31, 2019
ASSETS              
Cash and cash equivalents   $ 214,049   $ 118,973  
Trade and other receivables 3   672,870     560,976  
Inventories 4   509,517     383,682  
Prepaid expenses and deposits     21,844     25,846  
Income taxes recoverable     31,163     16,783  
TOTAL CURRENT ASSETS     1,449,443     1,106,260  
Property, plant and equipment 5   1,591,823     1,541,895  
Right-of-use assets 6   204,113     188,378  
Deferred tax assets     191,185     165,890  
Intangible assets 7   55,006     54,787  
Investments 8   40,188     37,085  
TOTAL NON-CURRENT ASSETS     2,082,315     1,988,035  
TOTAL ASSETS   $ 3,531,758   $ 3,094,295  
               
LIABILITIES              
Trade and other payables 10 $ 1,052,494   $ 728,787  
Provisions 11   5,100     8,584  
Income taxes payable     24,329     7,477  
Current portion of long-term debt 12   18,107     15,651  
Current portion of lease liabilities 13   34,123     28,247  
TOTAL CURRENT LIABILITIES     1,134,153     788,746  
Long-term debt 12   870,258     765,922  
Lease liabilities 13   190,282     174,105  
Pension and other post-retirement benefits     74,933     63,789  
Deferred tax liabilities     76,633     83,310  
TOTAL NON-CURRENT LIABILITIES     1,212,106     1,087,126  
TOTAL LIABILITIES     2,346,259     1,875,872  
               
EQUITY              
Capital stock 14   662,427     661,422  
Contributed surplus     43,256     42,449  
Accumulated other comprehensive income     147,813     89,107  
Retained earnings     332,003     425,445  
TOTAL EQUITY     1,185,499     1,218,423  
TOTAL LIABILITIES AND EQUITY   $ 3,531,758   $ 3,094,295  

Subsequent event (note 2)

Contingencies (note 20)

See accompanying notes to the interim condensed consolidated financial statements.

On behalf of the Board:

“Robert Wildeboer” Director
   
“Terry Lyons” Director

Martinrea International Inc.  
Interim Condensed Consolidated Statements of Operations  
(in thousands of Canadian dollars, except per share amounts) (unaudited)                           
                   
                   
      Three months ended   Three months ended   Nine months ended   Nine months ended
  Note   September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019
                   
SALES   $ 971,060   $ 974,384   $ 2,304,330   $ 2,946,078  
                   
Cost of sales (excluding depreciation of property, plant and equipment and right-of-use assets)     (768,280 )   (783,885 )   (1,890,680 )   (2,353,926 )
Depreciation of property, plant and equipment and right-of-use assets (production)     (51,302 )   (46,598 )   (154,394 )   (135,972 )
Total cost of sales     (819,582 )   (830,483 )   (2,045,074 )   (2,489,898 )
GROSS MARGIN     151,478     143,901     259,256     456,180  
                   
Research and development costs     (6,884 )   (10,086 )   (21,571 )   (28,159 )
Selling, general and administrative     (64,537 )   (57,381 )   (169,479 )   (176,024 )
Depreciation of property, plant and equipment and right-of-use assets (non-production)     (3,935 )   (3,602 )   (11,650 )   (10,959 )
Amortization of customer contracts and relationships     (323 )   (536 )   (964 )   (1,569 )
Gain (loss) on disposal of property, plant and equipment     (237 )   947     (237 )   1,206  
Impairment of assets 9   –     –     (85,783 )   (18,502 )
Restructuring costs 11   –     –     (8,170 )   (8,165 )
OPERATING INCOME (LOSS)     75,562     73,243     (38,598 )   214,008  
                   
Share of loss of an associate 8   (300 )   (818 )   (1,881 )   (1,330 )
Finance expense (including interest on lease liabilities) 17   (9,138 )   (9,345 )   (26,886 )   (29,085 )
Other finance income (expense) 17   (1,852 )   (273 )   (5,008 )   (1,369 )
INCOME (LOSS) BEFORE INCOME TAXES     64,272     62,807     (72,373 )   182,224  
                   
Income tax (expense) benefit 15   (18,636 )   (16,129 )   86     (52,156 )
NET INCOME (LOSS) FOR THE PERIOD   $ 45,636   $ 46,678   $ (72,287 ) $ 130,068  
                   
                   
Basic earnings (loss) per share 16 $ 0.57   $ 0.57   $ (0.90 ) $ 1.57  
Diluted earnings (loss) per share 16 $ 0.57   $ 0.56   $ (0.90 ) $ 1.56  

See accompanying notes to the interim condensed consolidated financial statements.

Martinrea International Inc.
Interim Condensed Consolidated Statements of Comprehensive Income
(in thousands of Canadian dollars, except per share amounts) (unaudited)     
                 
                 
    Three months ended   Three months ended   Nine months ended   Nine months ended
    September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019
                 
NET INCOME (LOSS) FOR THE PERIOD $ 45,636   $ 46,678   $ (72,287 ) $ 130,068  
Other comprehensive income (loss), net of tax:                
Items that may be reclassified to net income                
Foreign currency translation differences for foreign operations   (14,770 )   (1,556 )   59,153     (51,479 )
Cash flow hedging derivative and non-derivative financial instruments:                
Unrealized gain (loss) in fair value of financial instruments   1,977     (1,184 )   (1,267 )   2,336  
Reclassification of loss to net income   324     240     831     1,033  
Items that will not be reclassified to net income                
Change in fair value of investments   –     –     –     (776 )
Transfer of unrealized gain on investments to retained earnings on change in accounting method   –     –     –     (4,314 )
Share of other comprehensive income (loss) of an associate   (82 )   (6 )   (11 )   18  
Remeasurement of defined benefit plans   2,051     (3,763 )   (8,245 )   (8,187 )
Other comprehensive income (loss), net of tax   (10,500 )   (6,269 )   50,461     (61,369 )
TOTAL COMPREHENSIVE INCOME (LOSS) FOR THE PERIOD $ 35,136   $ 40,409   $ (21,826 ) $ 68,699  

See accompanying notes to the interim condensed consolidated financial statements.

Martinrea International Inc.

Interim Condensed Consolidated Statements of Changes in Equity
(in thousands of Canadian dollars) (unaudited) 

                         
                Accumulated        
                other        
        Capital   Contributed   comprehensive   Retained   Total
        stock   surplus   income   earnings   equity
BALANCE AT DECEMBER 31, 2018 $ 680,157   $ 42,016   $ 158,395   $ 270,981   $ 1,151,549  
Net income for the period   –     –     –     130,068     130,068  
Compensation expense related to stock options   –     892     –     –     892  
Dividends ($0.135 per share)   –     –     –     (11,126 )   (11,126 )
Exercise of employee stock options   2,036     (586 )   –     –     1,450  
Repurchase of common shares   (8,708 )   –     –     (5,655 )   (14,363 )
Other comprehensive income (loss) net of tax                    
  Remeasurement of defined benefit plans   –     –     –     (8,187 )   (8,187 )
  Foreign currency translation differences   –     –     (51,479 )   –     (51,479 )
  Change in fair value of investments   –     –     (776 )   –     (776 )
  Transfer of unrealized gain on investments to retained earnings on change in accounting method   –     –     (4,314 )   4,314     –  
  Share of other comprehensive income of an associate   –     –     18     –     18  
  Cash flow hedging derivative and non-derivative financial instruments:                    
    Unrealized gain in fair value of financial instruments   –     –     2,336     –     2,336  
    Reclassification of loss to net income   –     –     1,033     –     1,033  
BALANCE AT SEPTEMBER 30, 2019   673,485     42,322     105,213     380,395     1,201,415  
Net income for the period   –     –     –     51,153     51,153  
Compensation expense related to stock options   –     303     –     –     303  
Dividends ($0.045 per share)   –     –     –     (3,612 )   (3,612 )
Exercise of employee stock options   645     (176 )   –     –     469  
Repurchase of common shares   (12,708 )   –     –     (6,897 )   (19,605 )
Other comprehensive income (loss) net of tax                    
  Remeasurement of defined benefit plans   –     –     –     4,406     4,406  
  Foreign currency translation differences   –     –     (17,716 )   –     (17,716 )
  Share of other comprehensive loss of an associate   –     –     (44 )   –     (44 )
  Cash flow hedging derivative and non-derivative financial instruments:                    
    Unrealized gain in fair value of financial instruments   –     –     1,399     –     1,399  
    Reclassification of loss to net income   –     –     255     –     255  
BALANCE AT DECEMBER 31, 2019   661,422     42,449     89,107     425,445     1,218,423  
Net loss for the period   –     –     –     (72,287 )   (72,287 )
Compensation expense related to stock options   –     1,812     –     –     1,812  
Dividends ($0.15 per share)   –     –     –     (12,017 )   (12,017 )
Exercise of employee stock options   3,479     (1,005 )   –     –     2,474  
Repurchase of common shares   (2,474 )   –     –     (893 )   (3,367 )
Other comprehensive income (loss) net of tax                    
  Remeasurement of defined benefit plans   –     –     –     (8,245 )   (8,245 )
  Foreign currency translation differences   –     –     59,153     –     59,153  
  Share of other comprehensive loss of an associate   –     –     (11 )   –     (11 )
  Cash flow hedging derivative and non-derivative financial instruments:                    
    Unrealized loss in fair value of financial instruments   –     –     (1,267 )   –     (1,267 )
    Reclassification of loss to net income   –     –     831     –     831  
BALANCE AT SEPTEMBER 30, 2020 $ 662,427   $ 43,256   $ 147,813   $ 332,003   $ 1,185,499  

See accompanying notes to the interim condensed consolidated financial statements.

Martinrea International Inc.

Interim Condensed Consolidated Statements of Cash Flows
(in thousands of Canadian dollars) (unaudited) 

    Three months ended   Three months ended   Nine months ended   Nine months ended
    September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019
CASH PROVIDED BY (USED IN):                
OPERATING ACTIVITIES:                
Net Income (loss) for the period $ 45,636   $ 46,678   $ (72,287 ) $ 130,068  
Adjustments for:                
Depreciation of property, plant and equipment and right-of-use assets   55,237     50,200     166,044     146,931  
Amortization of customer contracts and relationships   323     536     964     1,569  
Amortization of development costs   2,873     3,568     8,690     10,251  
Impairment of assets (note 9)   –     –     85,783     18,502  
Unrealized loss on foreign exchange forward contracts   2,214     627     2,533     368  
Loss (gain) on warrants   –     (571 )   –     239  
Finance expense (including interest on lease liabilities)   9,138     9,345     26,886     29,085  
Income tax expense (benefit)   18,636     16,129     (86 )   52,156  
Loss (gain) on disposal of property, plant and equipment   237     (947 )   237     (1,206 )
Deferred and restricted share units expense (benefit)   (236 )   1,833     226     3,761  
Stock options expense   604     264     1,812     892  
Share of loss of an associate   300     818     1,881     1,330  
Pension and other post-retirement benefits expense   1,036     1,177     3,570     3,386  
Contributions made to pension and other post-retirement benefits   (1,992 )   (1,616 )   (5,328 )   (4,249 )
    134,006     128,041     220,925     393,083  
Changes in non-cash working capital items:                
Trade and other receivables   (143,374 )   1,795     (1,792 )   (53,146 )
Inventories   (62,073 )   28,596     (84,780 )   27,309  
Prepaid expenses and deposits   316     (2,137 )   6,730     (5,002 )
Trade, other payables and provisions   268,806     (38,097 )   158,959     7,076  
    197,681     118,198     300,042     369,320  
                 
Interest paid   (8,895 )   (9,243 )   (27,375 )   (31,412 )
Income taxes paid   (10,262 )   (11,885 )   (24,473 )   (52,172 )
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 178,524   $ 97,070   $ 248,194   $ 285,736  
                 
FINANCING ACTIVITIES:                
Increase in long-term debt (net of additions to deferred financing fees)   265     7,756     103,561     92,483  
Repayment of long-term debt   (4,481 )   (3,811 )   (12,696 )   (27,193 )
Principal payments of lease liabilities   (8,606 )   (6,873 )   (23,885 )   (20,984 )
Dividends paid   (4,004 )   (3,724 )   (11,614 )   (11,265 )
Exercise of employee stock options   1,618     528     2,474     1,450  
Repurchase of common shares   –     (11,899 )   (3,367 )   (38,234 )
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES $ (15,208 ) $ (18,023 ) $ 54,473   $ (3,743 )
                 
INVESTING ACTIVITIES:                
                 
Purchase of property, plant and equipment (excluding capitalized interest)*   (72,347 )   (57,431 )   (188,233 )   (217,877 )
Business acquisition (excluding cash acquired) (note 2)   –     –     (10,503 )   –  
Capitalized development costs   (3,902 )   (2,624 )   (8,557 )   (8,056 )
Investment in NanoXplore Inc. (note 8)   –     (14,478 )   (5,000 )   (29,477 )
Proceeds on disposal of property, plant and equipment   42     4,774     308     5,489  
Upfront recovery of development costs incurred   –     767     –     767  
NET CASH USED IN INVESTING ACTIVITIES $ (76,207 ) $ (68,992 ) $ (211,985 ) $ (249,154 )
                 
Effect of foreign exchange rate changes on cash and cash equivalents   1,106     1,214     4,394     (1,592 )
                 
INCREASE IN CASH AND CASH EQUIVALENTS   88,215     11,269     95,076     31,247  
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD   125,834     90,140     118,973     70,162  
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 214,049   $ 101,409   $ 214,049   $ 101,409  

*As at September 30, 2020, $40,731 (December 31, 2019 – $49,120) of purchases of property, plant and equipment remain unpaid and are recorded in trade and other payables and provisions.

See accompanying notes to the interim condensed consolidated financial statements.

Posted on

Medicure Reports Financial Results for Quarter Ended September 30, 2020

PR Newswire

WINNIPEG, MB, Nov. 11, 2020 /PRNewswire/ – Medicure Inc. (“Medicure” or the “Company“) (TSXV:MPH) (OTC:MCUJF), a cardiovascular pharmaceutical company, today reported its results from operations for the quarter ended September 30, 2020. 

Quarter Ended September 30, 2020 Highlights:

  • Recorded total net revenue from the sale of products of $3.5 million during the quarter ended September 30, 2020 compared to $5.5 million for the quarter ended September 30, 2019 and $2.7 million for the quarter ended June 30, 2020 and;
  • Recorded total net revenue from the sale of AGGRASTAT® of $3.4 million during the quarter ended September 30, 2020 compared to $5.3 million for the quarter ended September 30, 2019 and $2.6 million for the quarter ended June 30, 2020 and;
  • Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA1) for the quarter ended September 30, 2020 was $4,000 compared to adjusted EBITDA of negative $319,000 for the quarter ended September 30, 2019 and $263,000 for the quarter ended June 30, 2020 and
  • Net loss for the quarter ended September 30, 2020 was $1.0 million compared to $599,000 for the quarter ended September 30, 2019 and net income of $19,000 for the quarter ending June 30, 2020;

Financial Results

The decrease in AGGRASTAT® revenues when compared to the same periods in the previous year, as described above, is the result of decreases in the volume of the AGGRASTAT® sold in 2020 when compared to 2019, due mainly to less procedures being performed, primarily as a result of the COVID-19 pandemic. In addition, the Company continues to experience pricing pressures from competitors which contributed to the decline in revenues from AGGRASTAT®.

ZYPITAMAG® contributed $105,000 of revenue for the three months ended September 30, 2020 compared to $78,000 for the three months ended September 30, 2019 and $371,000 for the nine months ended September 30, 2020 compared to $87,000 for the nine months ended September 30, 2019. With improved insurance coverage, the launch of a direct to patient online pharmacy program, including direct to patient marketing, the Company has seen some growth in interest in ZYPITAMAG® during 2020. COVID-19 has provided some challenges with access to physicians, however the Company continues to pursue innovative marketing strategies to grow the usage of the product.

Additionally, sodium nitroprusside (SNP), which was first sold commercially during 2020, contributed $5,000 and $53,000, respectively, during the three and nine months ended September 30, 2020. The Company did not earn any revenues from ReDSTM during the three months ended September 30, 2020 compared to net revenue of $117,000 for the three months ended September 30, 2019.  Revenues from ReDSTM for the nine months ended September 30, 2020 totaled $89,000 compared to net revenue of $272,000 for the nine months ended September 30, 2019. 

Adjusted EBITDA for the three months ended September 30, 2020 was $4,000 compared to negative $319,000 for the three months ended September 30, 2019. The increase in adjusted EBITDA for the three months ended September 30, 2020 is the result of lower selling expenses, partially offset by lower revenues when compared to the same period in 2019.

Adjusted EBITDA for the nine months ended September 30, 2020 was negative $1.0 million compared to negative $1.9 million for the nine months ended September 30, 2019. The improvement in adjusted EBITDA for the nine months ended September 30, 2020 is the result of lower selling and research and development expenses, partially offset by lower revenues when compared to the same period in 2019.

During the three and nine months ended September 30, 2020, the Company recorded $404,000 and $729,000, respectively, in government assistance resulting from the Canada Emergency Wage Subsidy.  The funding has been recorded as a reduction of the related salary expenditures with $311,000 and $559,000, respectively, recorded within selling expenses, $52,000 and $95,000, respectively, recorded within general and administrative expenses and $41,000 and $75,000, respectively, recorded within research and development expenses.

Net loss for the three months ended September 30, 2020 was $1.0 million or $0.10 per share compared to net loss of $599,000 or $0.04 per share for the three months ended September 30, 2019. The change in the net income for the three months ended September 30, 2020 is the result of lower revenues, partially offset by lower selling and research and development expenses and changes in foreign exchange gains and losses when compared to the three months ended September 30, 2019.

Net loss for the nine months ended September 30, 2020 was $2.5 million or $0.23 per share compared to $4.3 million or $0.28 per share for the nine months ended September 30, 2019. The change in the net loss for the nine months ended September 30, 2020 is the result of lower revenues and higher cost of goods sold primarily from increased amortization, partially offset by lower selling and research and development expenses and changes in foreign exchange gains and losses when compared to the nine months ended September 30, 2019.

At September 30, 2020, the Company had unrestricted cash totaling $11.9 million down from the $13.0 million of unrestricted cash held as of December 31, 2019. Cash flows used in operating activities for the nine months ended September 30, 2020 totaled $1.1 million compared to $10.9 million for the nine months ended September 30, 2019.

All amounts referenced herein are in Canadian dollars unless otherwise noted.

Notes

(1)  The Company defines EBITDA as “earnings before interest, taxes, depreciation, amortization and other income or expense” and Adjusted EBITDA as “EBITDA adjusted for non–cash and non-recurring items”. The terms “EBITDA” and “Adjusted EBITDA”, as it relates to the three and nine months ended September 30, 2020 and 2019 results prepared using IFRS, do not have any standardized meaning according to IFRS. It is therefore unlikely to be comparable to similar measures presented by other companies.

Conference Call Info:

Topic: Medicure’s Q3 2020 Results

Call date: Thursday, November 12, 2020

Time: 7:30 AM Central Time (8:30 AM Eastern Time)

Canada toll: 1 (416) 764-8659

North American toll-free: 1 (888) 664-6392

Passcode: not required

Webcast: This conference call will be webcast live over the internet and can be accessed from the Medicure investor relations page at the following link: http://www.medicure.com/investors   

You may request international country-specific access information by e-mailing the Company in advance. Management will accept and answer questions related to the financial results and operations during the question-and-answer period at the end of the conference call. A recording of the call will be available following the event at the Company’s website.

About Medicure Inc.
Medicure is a pharmaceutical company focused on the development and commercialization of therapies for the U.S. cardiovascular market. The present focus of the Company is the marketing and distribution of AGGRASTAT® (tirofiban hydrochloride) injection and ZYPITAMAG® (pitavastatin) tablets in the United States, where they are sold through the Company’s U.S. subsidiary, Medicure Pharma Inc. For more information on Medicure please visit www.medicure.com.

To be added to Medicure’s e-mail list, please visit: http://medicure.mediaroom.com/alerts

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.


Forward Looking Information: Statements contained in this press release that are not statements of historical fact, including, without limitation, statements containing the words “believes”, “may”, “plans”, “will”, “estimates”, “continues”, “anticipates”, “intends”, “expects” and similar expressions, may constitute “forward-looking information” within the meaning of applicable Canadian and U.S. federal securities laws (such forward-looking information and forward-looking statements are hereinafter collectively referred to as “forward-looking statements”). Forward-looking statements, include estimates, analysis and opinions of management of the Company made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors which the Company believes to be relevant and reasonable in the circumstances. Inherent in forward-looking statements are known and unknown risks, uncertainties and other factors beyond the Company’s ability to predict or control that may cause the actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements, and as such, readers are cautioned not to place undue reliance on forward-looking statements. Such risk factors include, among others, the Company’s future product revenues, expected future growth in revenues, stage of development, additional capital requirements, risks associated with the completion and timing of clinical trials and obtaining regulatory approval to market the Company’s products, the ability to protect its intellectual property, dependence upon collaborative partners, changes in government regulation or regulatory approval processes, and rapid technological change in the industry. Such statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions about: general business and economic conditions; the impact of changes in Canadian-US dollar and other foreign exchange rates on the Company’s revenues, costs and results; the timing of the receipt of regulatory and governmental approvals for the Company’s research and development projects; the availability of financing for the Company’s commercial operations and/or research and development projects, or the availability of financing on reasonable terms; results of current and future clinical trials; the uncertainties associated with the acceptance and demand for new products and market competition. The foregoing list of important factors and assumptions is not exhaustive. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking statements or the foregoing list of factors, other than as may be required by applicable legislation. Additional discussion regarding the risks and uncertainties relating to the Company and its business can be found in the Company’s other filings with the applicable Canadian securities regulatory authorities or the US Securities and Exchange Commission, and in the “Risk Factors” section of its Form 20F for the year ended December 31, 2019.

AGGRASTAT® (tirofiban hydrochloride) is a registered trademark of Medicure International Inc.




Condensed Consolidated Interim Statements of Financial Position

(expressed in thousands of Canadian dollars, except per share amounts)

(unaudited)


September 30, 2020

December 31, 2019

 


Assets

Current assets:

Cash and cash equivalents


$


11,871

$

12,965

Accounts receivable


6,206

10,216

Inventories


6,202

6,328

Prepaid expenses


1,233

1,855

Total current assets


25,512

31,364

Non–current assets:

Property, plant and equipment


1,058

1,282

Intangible assets


8,048

9,599

Other assets


27

39

Total non–current assets


9,133

10,920


Total assets


$


34,645

$

42,284

 


Liabilities and Equity

Current liabilities:

Accounts payable and accrued liabilities


$


5,462

$

9,384

Current portion of royalty obligation


716

872

Current portion of acquisition payable


667

649

Income taxes payable


474

517

Current portion of lease obligation


263

240

Total current liabilities


7,582

11,662

Non–current liabilities

Royalty obligation


725

1,176

Acquisition payable


1,158

1,655

Lease obligation


684

849

Total non–current liabilities


2,567

3,680

Total liabilities


10,149

15,342

Equity:

Share capital


84,232

85,364

Warrants


1,949

1,949

Contributed surplus


8,267

8,028

Accumulated other comprehensive income


(5,790)

(5,751)

Deficit


(64,162)

(62,648)

Total Equity


24,496

26,942


Total liabilities and equity


$


34,645

$

42,284

 


Condensed Consolidated Interim Statements of Net Loss and Comprehensive Loss

(expressed in thousands of Canadian dollars, except per share amounts)

(unaudited)


Three months
ended


September 30,
2020

Three months
ended

September 30,
2019


Nine months
ended


September 30,
2020

Nine months

ended

September 30,
2019

Revenue, net


$


3,549

$

5,519


$


9,235

$

16,700

Cost of goods sold


1,363

1,496


4,381

3,887


Gross profit


2,186

4,023


4,854

12,813


Expenses

Selling


923

3,349


3,963

10,796

General and administrative


1,264

1,044


2,834

2,748

Research and development


737

976


1,693

3,078


2,924

5,369


8,490

16,622

Finance (income) costs:

Finance (income) expense, net


99

(116)


(208)

(488)

Foreign exchange (gain) loss, net


210

(601)


(936)

1,093


309

(717)


(1,144)

605

Net loss before income taxes


$


(1,047)

$

(629)


$


(2,492)

$

(4,414)

Income tax recovery

Current


–

(30)


–

(102)


Net loss


$


(1,047)

$

(599)


$


(2,492)

$

(4,312)

Other comprehensive (loss) income:

Item that may be reclassified to profit or loss

Exchange differences on translation
of foreign subsidiaries


(272)

195


(39)

(1,293)

Item that will not be reclassified to profit or loss:

Revaluation of investment in
Sensible Medical at FVOCI


–

(212)


–

(456)

Other comprehensive loss, net of tax


(272)

(17)


(39)

(1,749)

Comprehensive loss


$


(1,319)

$

(616)


$


(2,531)

$

(6,061)

Loss per share

Basic

$

(0.10)

$

(0.04)


$


(0.23)

$

(0.28)

Diluted

$

(0.10)

$

(0.04)


$


(0.23)

$

(0.28)

 


Condensed Consolidated Interim Statements of Cash Flows

(expressed in thousands of Canadian dollars, except per share amounts)

(unaudited)


For the nine months ended September 30


2020

2019

Cash (used in) provided by:

Operating activities:

Net loss for the period


$


(2,492)

$

(4,312)

Adjustments for:

Current income tax recovery


–

(102)

Amortization of property, plant and equipment


224

382

Amortization of intangible assets


1,838

667

Share–based compensation


239

280

Write-down of inventories


311

578

Finance income, net


(208)

(488)

Unrealized foreign exchange (gain) loss


(476)

7

Change in the following:

Accounts receivable


4,022

(655)

Inventories


(185)

(4,610)

Prepaid expenses


622

750

Accounts payable and accrued liabilities


(4,589)

(3,350)

Interest received, net


26

1,609

Income taxes paid


(57)

(477)

Royalties paid


(326)

(1,133)


Cash flows used in operating activities


(1,051)

(10,854)

Investing activities:

Investment in Sensible Medical


–

(6,337)

Redemption of short-term investments


–

47,747

Acquisition of property, plant and equipment


–

(186)

Acquisition of intangible assets


–

(13,660)


Cash flows from investing activities


–

27,564

Financing activities:

Purchase of common shares under normal course issuer bid


(154)

(4,145)

Exercise of stock options


–

20


Cash flows used in financing activities


(154)

(4,125)

Foreign exchange gain (loss) on cash held in foreign currency


111

(1,023)

(Decrease) increase in cash and cash equivalents


(1,094)

11,562

Cash and cash equivalents, beginning of period


12,965

24,139


Cash and cash equivalents, end of period


$


11,871

$

35,701

 

Cision View original content:http://www.prnewswire.com/news-releases/medicure-reports-financial-results-for-quarter-ended-september-30-2020-301171347.html

SOURCE Medicure Inc.