Market Newsdesk

November 11, 2020 6:03 pm

Bright Scholar Announces Unaudited Financial Results for the Fourth Fiscal Quarter

Fiscal Year 2020 Revenue Up 31.3% and Adjusted EBITDA Up 36.5%

PR Newswire

FOSHAN, China, Nov. 11, 2020 /PRNewswire/ — Bright Scholar Education Holdings Limited (“Bright Scholar,” the “Company,” “we” or “our”) (NYSE: BEDU), a global premier education service company, today announced its unaudited financial results for the fourth fiscal quarter and fiscal year ended August 31, 2020.

Fourth Fiscal Quarter Ended August 31, 2020 Financial Highlights
(in comparison to the same period of the last fiscal year):

*RMB in million* *Except EPS and %*	Fourth Fiscal Quarter Ended August 31, 2020	Fourth Fiscal Quarter Ended August 31, 2019	YoY % Change
Revenue	652.1	711.6	(8.4%)
Gross Profit	149.5	212.1	(29.5%)
Gross Margin	22.9%	29.8%	(6.9%)
Operating Loss	(171.9)	(44.4)	286.9%
Operating Margin	(26.4%)	(6.2%)	(20.2%)
Net Loss	(148.6)	(48.1)	208.8%
Net Margin	(22.8%)	(6.8%)	(16.0%)

Adjusted Gross Profit⁽¹⁾	158.0	221.6	(28.7%)
Adjusted Gross Margin⁽¹⁾	24.2%	31.1%	(6.9%)
Adjusted Operating Loss⁽²⁾	(80.4)	(28.4)	183.4%
Adjusted Operating Margin⁽²⁾	(12.3%)	(4.0%)	(8.3%)
Adjusted Net Loss⁽³⁾	(59.0)	(34.1)	72.9%
Adjusted Net Margin⁽³⁾	(9.1%)	(4.8%)	(4.3%)
Adjusted EBITDA⁽⁴⁾	1.4	4.0	(65.8%)
Adjusted EBITDA Margin⁽⁴⁾	0.2%	0.6%	(0.4%)

Basic and Diluted Loss per Share	(1.29)	(0.43)	200.0%
Adjusted Basic and Diluted Loss per Share⁽⁵⁾	(0.54)	(0.31)	74.2%

Fiscal Year 2020 Ended August 31, 2020 Financial Highlights
(in comparison to the same period of the last fiscal year):

*RMB in million* *Except EPS and %*	Fiscal Year 2020 Ended August 31, 2020	Fiscal Year 2019 Ended August 31, 2019	YoY % Change
Revenue	3,366.5	2,563.0	31.3%
Gross Profit	1,221.7	977.0	25.0%
Gross Margin	36.3%	38.1%	(1.8%)
Operating Income	307.7	300.5	2.4%
Operating Margin	9.1%	11.7%	(2.6%)
Net Income	164.2	252.8	(35.0%)
Net Margin	4.9%	9.9%	(5.0%)

Adjusted Gross Profit⁽¹⁾	1,263.2	1,000.3	26.3%
Adjusted Gross Margin⁽¹⁾	37.5%	39.0%	(1.5%)
Adjusted Operating Income⁽²⁾	420.0	375.5	11.9%
Adjusted Operating Margin⁽²⁾	12.5%	14.6%	(2.1%)
Adjusted Net Income⁽³⁾	267.7	322.6	(17.0%)
Adjusted Net Margin⁽³⁾	8.0%	12.6%	(4.6%)
Adjusted EBITDA⁽⁴⁾	670.8	491.6	36.5%
Adjusted EBITDA Margin⁽⁴⁾	19.9%	19.2%	0.7%

Basic and Diluted Earnings per Share	1.34	1.97	(32.0%)
Adjusted Basic and Diluted Earnings per Share⁽⁵⁾	2.20	2.54	(13.4%)

1. Adjusted gross profit/(loss) is defined as gross profit/(loss) excluding amortization of intangible assets. Adjusted gross margin is defined as adjusted gross profit/(loss) divided by revenue.
2. Adjusted operating income/(loss) is defined as operating income/(loss) excluding share-based compensation expense, amortization of intangible assets, impairment loss on operating lease right-of-use assets and impairment loss on goodwill. Adjusted operating margin is defined as adjusted operating income/(loss) divided by revenue.
3. Adjusted net income/(loss) is defined as net income/(loss) excluding share-based compensation expense, amortization of intangible assets, tax effect of amortization of intangible assets, impairment loss on operating lease right-of-use assets and impairment loss on goodwill. Adjusted net margin is defined as adjusted net income/(loss) divided by revenue.
4. Adjusted EBITDA is defined as net income/(loss) excluding interest income/(expense), net; income tax expense/benefit; depreciation and amortization, share-based compensation expense, impairment loss on operating lease right-of-use assets and impairment loss on goodwill. Adjusted EBITDA margin is defined as adjusted EBITDA divided by revenue.
5. Adjusted basic and diluted earnings/(loss) per share is defined as adjusted net income/(loss) attributable to ordinary shareholders (net income/(loss) to ordinary shareholders excluding share-based compensation expense, amortization of intangible assets, tax effect of amortization of intangible assets, impairment loss on operating lease right-of-use assets and impairment loss on goodwill) divided by the weighted average number of basic and diluted ordinary shares or American depositary shares (each an “ADS”), each representing one Class A ordinary share of the Company, on an as-converted basis.

For more information on these adjusted financial measures, please see the section captioned under “Non-GAAP Financial Measures” and the tables captioned “Reconciliations of GAAP and Non-GAAP Results” set forth at the end of this release.

BUSINESS PERFORMANCE HIGHLIGHTS
(in comparison to the same period of the last fiscal year)

Domestic K-12 Schools

The domestic K-12 schools comprise our international schools, bilingual schools, kindergartens in China.

The average number of students increased by 6.6% for the fourth fiscal quarter and 9.9% for the fiscal year.
Revenue amounted to RMB416.2 million and accounted for 63.9% of the total revenue in the fourth fiscal quarter. For the fiscal year, revenue increased by 4.1% to RMB1,968.3 million and accounted for 58.5% of the total revenue.
For the fourth fiscal quarter, gross margin was 27.5% compared to 31.0% for the same period of the last fiscal year, and operating margin was (10.2%) compared to 7.5% for the same period of the last fiscal year. For the fiscal year, gross margin was 39.2% compared to 39.9% for the last fiscal year, and operating margin was 20.5% as compared to 24.4% for the last fiscal year.

Overseas Schools

The overseas schools comprise our overseas schools including Bournemouth, St. Michael’s, Bosworth and CATS.

Revenue amounted to RMB69.1 million and accounted for 10.6% of the total revenue for the fourth fiscal quarter. For the fiscal year, revenue amounted to RMB835.9 million and accounted for 24.8% of the total revenue for the same period.
For the fourth fiscal quarter, gross margin was (49.3%) and operating margin was (171.0%). For the fiscal year, gross margin was 29.6% and operating margin was (5.4%).

Education Technology

The education technology business comprises online career counselling, online Academic Olympiad training, and online international school.

Revenue amounted to RMB31.6 million and accounted for 4.8% of the total revenue for the fourth fiscal quarter. For the fiscal year, revenue amounted to RMB103.3 million and accounted for 3.1% of the total revenue.
For the fourth fiscal quarter, gross margin was 50.5% and operating margin was 20.5%. For the fiscal year, gross margin was 62.7% and operating margin was 30.2%.

Complementary Education Services

The complementary education services comprise language training, overseas study and counselling, camps and study tours, and others.

Revenue amounted to RMB135.2 million and accounted for 20.7% of the total revenue for the fourth fiscal quarter. For the fiscal year, revenue was RMB459.0 million and accounted for 13.6% of the total revenue.
For the fourth fiscal quarter, gross margin increased from 30.9% to 39.2%, and operating margin increased from 13.6% to 24.9%. For the fiscal year, gross margin was 30.0% compared to 31.8%, and operating margin was 10.5% compared to 12.0%.

“As with most businesses around the globe, COVID-19 pandemic has had an unprecedented impact on our industry and our Company in the second half of fiscal 2020. Amidst the significant challenges and disruptions particularly in our overseas schools, Bright Scholar still delivered solid revenue growth of 31.3% and a solid growth of 36.5% in adjusted EBITDA for fiscal year of 2020. We have also accelerated digital transformation as we continued to focus on executing our strategic priorities to build a global network of schools and a diverse business portfolio, enhance academic and operational performance, and expand the breadth and depth of our capabilities through investment in education technologies,” said Jerry He, Executive Vice Chairman of Bright Scholar.

“China’s encouraging signs of steady economic recovery from the pandemic and its continuous efforts to minimize the risk of resurgences of the virus provides strong impetus to strengthen our business recovery,” commented by Wanmei Li, Chief Executive Officer of Domestic K-12. “Over 54,000 students have enrolled for the September 2020 school term in our domestic K-12 schools, as of the reporting date. The average number of students increased by 6.6% for the fourth fiscal quarter and 9.9% for the fiscal year compared to the same period in the prior fiscal year. All of our K-12 campuses in China have re-opened with safeguards in all of our facilities to protect our students and staff, including increased frequency of cleaning and disinfecting facilities, social distancing practices and other measures to minimize any potential risks of resurgence. Despite the positive momentum, we stay vigilant of the continued impact and focus on optimizing utilization and profitability from our operations.” Ms. Li continued, “I am pleased to report that Fettes Guangzhou School and kindergarten opened as scheduled in September.”

“Despite the impact from COVID-19, revenue for fiscal year 2020 grew by 9.1% as compared to the prior fiscal year as we seized the opportunity in the summer by launching new products and services to strengthen our market position. The acquisition of Leti Camp will further expand our capability to include adoption of hands-on inquiry-based learning that offers enormous potential and synergy which will expedite the expansion of our outdoor camp business in the post COVID-19 period,” commented by Zi Chen, Chief Executive Officer of Complementary Education Services. “There are enormous market opportunities in complementary education service space including after school tutoring for K-12, study tours and camp activities. We plan to further leverage the collaboration with Country Garden to explore more opportunities in broadening our outdoor camp business within China, as well as acquisitions to expand our service offerings.”

Mr. He commented on the performance of overseas school business, “Overseas school operation was most negatively affected amid the continuing pandemic and lockdown in the UK. Our ‘We Care’ Campaign put the well-being of our students and employees first, has earned high marks from our parents and students. We also took this opportunity to reduce our cost structure, upgrade our IT and management systems, realign our sales and marketing strategies and improve our education outcome. We believe we will be in a more competitive position than our peers when students return to schools post COVID-19. Our global network is of strategic importance in enriching student lives and learning experience, enhancing academic performance through global recruitment and training, joint R&D, collaboration between our overseas and domestic schools as well as across different business units within Bright Scholar.”

Mr. He continued on the performance of education technology business, “The COVID-19 crisis has been a major catalyst driving policymakers, service providers and more parents and families to explore online learning options. The increasing awareness and acceptance of online resources merging offline activities for optimal educational results, bodes well for us to drive academic excellence as we continued to expand investments in this space. Our new education technology business comprises online career counselling, online Academic Olympiad training and online international school – the ‘3i Global Academy’. The launch of the online international schools with online-merge-offline model in June represents a major milestone in utilizing technology to provide access to high quality education for students around the globe. ‘3i Global Academy’ has enrolled more than 170 paying students as of November 7th.”

“We recognize that the uncertainties our road ahead entails, but we are excited at the combination of growth drivers coming into alignment for fiscal 2021. These growth drivers include the steady economic recovery from the pandemic in China, the improved service mix of our portfolio and the new exciting opportunities in the complementary business and education technologies. We have a strong balance sheet to pursue organic and acquisitive growth opportunities, a terrific portfolio of assets that drives long-term growth. We are very confident that the strategic initiatives will enable us to emerge from the crisis as a stronger company that is well positioned for long-term growth and success. Furthermore, to underscore the confidence in the Company’s prospects, the Board has approved a new share repurchase plan of up to US$50 million on November 11, 2020,” Mr. He concluded.

UNAUDITED FINANCIAL RESULTS
for the Fourth
FISCAL QUARTER ENDED August 31, 2020

Revenue

Revenue	Fourth Fiscal Quarter Ended August 31, 2020		Fourth Fiscal Quarter Ended August 31, 2019		YoY % Change
	*(RMB in million)*	*(% of Total Revenue)*	*(RMB in million)*	*(% of Total Revenue)*
Domestic K-12 Schools	416.2	63.9%	393.5	55.3%	5.8%
International Schools	177.4	27.2%	154.3	21.7%	15.0%
Bilingual Schools	149.2	22.9%	130.8	18.4%	14.0%
Kindergartens	89.6	13.8%	108.4	15.2%	(17.3%)
Overseas Schools	69.1	10.6%	148.5	20.9%	(53.4%)
Education Technology	31.6	4.8%	27.7	3.9%	14.0%
Complementary Education	135.2	20.7%	141.9	19.9%	(4.7%)
Total	652.1	100.0%	711.6	100.0%	(8.4%)

Revenue for the quarter was RMB652.1 million, as compared to RMB711.6 million for the same period of the last fiscal year. The changes in revenue is primarily due to the COVID-19 impact on kindergartens, overseas schools and complementary business.

Cost of Revenue

Cost of revenue for the quarter was RMB502.7 million, as compared to RMB499.5 million for the same period of the last fiscal year. The changes in cost of revenue was mainly due to the cost increase in domestic K-12 schools and EdTech in the fourth fiscal quarter of 2020, partially offset by the cost reduction in overseas schools and complementary education.

Gross Profit, Gross Margin and Adjusted Gross Profit

Gross Profit	Fourth Fiscal Quarter Ended August 31, 2020		Fourth Fiscal Quarter Ended August 31, 2019		YoY % Change
	*(RMB in million)*	*(Margin %)*	*(RMB in million)*	*(Margin %)*
Domestic K-12 Schools	114.6	27.5%	122.0	31.0%	(6.0%)
International Schools	49.2	27.7%	36.9	23.9%	33.5%
Bilingual Schools	47.3	31.7%	44.5	34.0%	6.2%
Kindergartens	18.1	20.3%	40.6	37.5%	(55.2%)
Overseas Schools	(34.1)	(49.3%)	25.2	17.0%	(235.5%)
Education Technology	16.0	50.5%	21.1	76.0%	(24.3%)
Complementary Education	53.0	39.2%	43.8	30.9%	20.7%
Total	149.5	22.9%	212.1	29.8%	(29.5%)

Gross profit for the quarter was RMB149.5 million, as compared to RMB212.1 million for the same period of the last fiscal year. Gross margin was 22.9% for the quarter, as compared to 29.8% for the same period of the last fiscal year.

Adjusted gross profit for the quarter was RMB158.0 million, as compared to RMB221.6 million for the same period of the last fiscal year. Adjusted gross margin was 24.2% for the quarter, as compared to 31.1% for the same period of the last fiscal year.

Selling, General and Administrative Expenses and Adjusted SG&A Expenses⁽⁶⁾

SG&A Expenses	Fourth Fiscal Quarter Ended August 31, 2020		Fourth Fiscal Quarter Ended August 31, 2019		YoY % Change
	*(RMB in* *million)*	(% of Total Revenue)	*(RMB in* *million)*	(% of Total Revenue)
Domestic K-12 Schools	89.0	13.6%	92.7	13.1%	(4.0%)
International Schools	40.4	6.2%	38.5	5.4%	5.1%
Bilingual Schools	28.9	4.4%	29.6	4.2%	(2.5%)
Kindergartens	19.7	3.0%	24.6	3.5%	(19.8%)
Overseas Schools	85.1	13.1%	61.5	8.6%	38.5%
Education Technology	9.5	1.5%	6.6	0.9%	44.8%
Complementary Education	25.8	3.9%	24.7	3.5%	4.0%
Unallocated Corporate Expenses⁽⁷⁾	53.2	8.2%	74.5	10.4%	(28.5%)
Total	262.6	40.3%	260.0	36.5%	1.0%

Adj. SG&A Expenses⁽⁶⁾	Fourth Fiscal Quarter Ended August 31, 2020		Fourth Fiscal Quarter Ended August 31, 2019		YoY % Change
	*(RMB in* *million)*	(% of Total Revenue)	*(RMB in* *million)*	(% of Total Revenue)
Domestic K-12 Schools	88.3	13.5%	90.2	12.6%	(2.0%)
International Schools	40.5	6.2%	38.0	5.3%	6.5%
Bilingual Schools	28.6	4.4%	28.4	4.0%	0.7%
Kindergartens	19.2	2.9%	23.8	3.3%	(19.0%)
Overseas Schools	85.1	13.1%	61.5	8.6%	38.5%
Education Technology	9.5	1.5%	6.6	0.9%	44.8%
Complementary Education	26.0	3.9%	24.0	3.4%	7.2%
Unallocated Corporate Expenses⁽⁸⁾	52.3	8.1%	71.1	10.1%	(26.2%)
Total	261.2	40.1%	253.4	35.6%	3.1%

6. Adjusted SG&A expenses is defined as selling, general and administrative expenses excluding share-based compensation expense.
7. Unallocated corporate expenses are mainly from headquarter, including staff cost, share-based compensation expense and other office expenses.
8. Adjusted unallocated corporate expenses is defined as unallocated corporate expenses excluding share-based compensation expense.

Total SG&A expenses for the quarter were RMB262.6 million, representing a 1.0% increase from RMB260.0 million for the same period of the last fiscal year. Adjusted SG&A expenses for the quarter were RMB261.2 million, representing a 3.1% increase from RMB253.4 million for the same period of the last fiscal year.

Operating Loss, Operating Margin and Adjusted Operating Loss

Operating (Loss)/Income	Fourth Fiscal Quarter Ended August 31, 2020		Fourth Fiscal Quarter Ended August 31, 2019		YoY % Change
	(RMB in million)	*(Margin %)*	(RMB in million)	*(Margin %)*
Domestic K-12 Schools	(42.5)	(10.2%)	29.6	7.5%	(243.5%)
International Schools	(59.8)	(33.7%)	(1.2)	(0.8%)	4,932.3%
Bilingual Schools	18.5	12.4%	14.9	11.4%	24.5%
Kindergartens	(1.2)	(1.3%)	15.9	14.7%	(107.6%)
Overseas Schools	(118.2)	(171.0%)	(36.3)	(24.4%)	226.0%
Education Technology	6.5	20.5%	14.5	52.3%	(55.3%)
Complementary Education	33.4	24.9%	19.3	13.6%	74.6%
Unallocated Corporate Expenses	(51.1)	–	(71.5)	–	(28.3%)
Total	(171.9)	(26.4%)	(44.4)	(6.2%)	286.9%

Operating loss for the quarter was RMB171.9 million, as compared to operating loss of RMB44.4 million for the same period of the last fiscal year. Operating margin was (26.4%) for the quarter, as compared to (6.2%) for the same period of the last fiscal year.

Adjusted operating loss for the quarter was RMB80.4 million, as compared to RMB28.4 million for the same period of the last fiscal year. Adjusted operating margin was (12.3%) for the quarter, as compared to (4.0%) for the same period of the last fiscal year.

Net Loss and Adjusted Net Loss

Net loss for the quarter was RMB148.6 million, as compared to net loss of RMB48.1 million for the same period of the last fiscal year.

Adjusted net loss for the quarter was RMB59.0 million, as compared to adjusted net loss of RMB34.1 million for the same period of the last fiscal year.

Loss per ordinary share/ADS and Adjusted Loss per ordinary share/ADS

Basic and diluted net loss per ordinary share/ADS attributable to ordinary shareholders/ADS holders for the quarter were RMB1.29 and RMB1.29, respectively, as compared to loss per share of RMB0.43 and RMB0.43, respectively, for the same period of the last fiscal year.

Adjusted basic and diluted net loss per ordinary share/ADS attributable to ordinary shareholders/ADS holders for the quarter were RMB0.54 and RMB0.54, respectively, as compared to loss per share of RMB0.31 and RMB0.31, respectively, for the same period of the last fiscal year.

Adjusted EBITDA

Adjusted EBITDA for the quarter was RMB1.4 million, as compared to RMB4.0 million for the same period of the last fiscal year.

UNAUDITED FINANCIAL RESULTS
for the Fiscal year
ENDED August 31, 2020

Revenue

Revenue	Fiscal Year 2020 Ended August 31, 2020		Fiscal Year 2019 Ended August 31, 2019		YoY % Change
	*(RMB in million)*	*(% of Total Revenue)*	*(RMB in million)*	*(% of Total Revenue)*
Domestic K-12 Schools	1,968.3	58.5%	1,890.4	73.8%	4.1%
International Schools	872.9	25.9%	745.0	29.1%	17.2%
Bilingual Schools	722.4	21.5%	650.4	25.4%	11.1%
Kindergartens	373.0	11.1%	495.0	19.3%	(24.6%)
Overseas Schools	835.9	24.8%	181.8	7.1%	359.9%
Education Technology	103.3	3.1%	70.0	2.7%	47.7%
Complementary Education	459.0	13.6%	420.8	16.4%	9.1%
Total	3,366.5	100.0%	2,563.0	100.0%	31.3%

Revenue for fiscal year 2020 was RMB3,366.5 million, representing a 31.3% increase from RMB2,563.0 million for the last fiscal year.

Cost of Revenue

Cost of revenue for the fiscal year was RMB2,144.8 million, representing a 35.2% increase from RMB1,586.0 million for the last fiscal year.

Gross Profit, Gross Margin and Adjusted Gross Profit

Gross Profit	Fiscal Year 2020 Ended August 31, 2020		Fiscal Year 2019 Ended August 31, 2019		YoY % Change
	*(RMB in million)*	*(Margin %)*	*(RMB in million)*	*(Margin %)*
Domestic K-12 Schools	771.9	39.2%	755.0	39.9%	2.2%
International Schools	370.7	42.5%	289.0	38.8%	28.3%
Bilingual Schools	300.5	41.6%	250.4	38.5%	20.0%
Kindergartens	100.7	27.0%	215.6	43.6%	(53.3%)
Overseas Schools	247.1	29.6%	36.3	19.9%	584.0%
Education Technology	64.8	62.7%	51.9	74.1%	24.9%
Complementary Education	137.9	30.0%	133.8	31.8%	3.0%
Total	1,221.7	36.3%	977.0	38.1%	25.0%

Gross profit for the fiscal year was RMB1,221.7 million, representing a 25.0% increase from RMB977.0 million for the last fiscal year. Gross margin was 36.3% for the period, as compared to 38.1% for the last fiscal year. The increase in gross profit was primarily due to the acquisition of overseas schools including CATS, Bosworth and St. Michael’s.

Adjusted gross profit for the fiscal year was RMB1,263.2 million, representing a 26.3% increase from RMB1,000.3 million for the last fiscal year. Adjusted gross margin was 37.5% for the fiscal year, as compared to 39.0% for the last fiscal year.

Selling, General and Administrative Expenses and Adjusted SG&A Expenses⁽⁶⁾

SG&A Expenses	Fiscal Year 2020 Ended August 31, 2020		Fiscal Year 2019 Ended August 31, 2019		YoY % Change
	*(RMB in* *million)*	(% of Total Revenue)	*(RMB in* *million)*	(% of Total Revenue)
Domestic K-12 Schools	302.2	9.0%	298.5	11.7%	1.2%
International Schools	125.7	3.7%	110.4	4.3%	13.9%
Bilingual Schools	103.0	3.1%	104.6	4.1%	(1.5%)
Kindergartens	73.5	2.2%	83.5	3.3%	(12.0%)
Overseas Schools	301.9	9.0%	75.9	3.0%	297.7%
Education Technology	34.2	1.0%	18.7	0.7%	83.1%
Complementary Education	97.6	2.9%	83.9	3.3%	16.3%
Unallocated Corporate Expenses⁽⁷⁾	135.3	4.0%	214.9	8.3%	(37.1%)
Total	871.2	25.9%	691.9	27.0%	25.9%

Adj. SG&A Expenses⁽⁶⁾	Fiscal Year 2020 Ended August 31, 2020		Fiscal Year 2019 Ended August 31, 2019		YoY % Change
	*(RMB in* *million)*	(% of Total Revenue)	*(RMB in* *million)*	(% of Total Revenue)
Domestic K-12 Schools	297.8	8.8%	288.2	11.2%	3.3%
International Schools	125.5	3.7%	108.7	4.2%	15.4%
Bilingual Schools	100.8	3.0%	100.2	3.9%	0.6%
Kindergartens	71.5	2.1%	79.3	3.1%	(9.9%)
Overseas Schools	301.9	9.0%	75.9	3.0%	297.7%
Education Technology	34.2	1.0%	18.7	0.7%	83.1%
Complementary Education	96.7	2.9%	79.3	3.1%	22.0%
Unallocated Corporate Expenses⁽⁸⁾	151.2	4.5%	178.1	7.0%	(15.1%)
Total	881.8	26.2%	640.2	25.0%	37.7%

6. Adjusted SG&A expenses is defined as selling, general and administrative expenses excluding share-based compensation expense.
7. Unallocated corporate expenses are mainly from headquarter, including staff cost, share-based compensation expense and other office expenses.
8. Adjusted unallocated corporate expenses is defined as unallocated corporate expenses excluding share-based compensation expense.

Total SG&A expenses for the fiscal year were RMB871.2 million, representing a 25.9% increase from RMB691.9 million for the last fiscal year. The increase in SG&A expense was primarily due to the acquisition of overseas schools.

Adjusted SG&A expenses for the fiscal year were RMB881.8 million, representing a 37.7% increase from RMB640.2 million for the last fiscal year.

Operating Income, Operating Margin and Adjusted Operating Income

Operating Income/(Loss)	Fiscal Year 2020 Ended August 31, 2020		Fiscal Year 2019 Ended August 31, 2019		YoY % Change
	*(RMB in million)*	*(Margin %)*	*(RMB in million)*	*(Margin %)*
Domestic K-12 Schools	404.1	20.5%	460.8	24.4%	(12.3%)
International Schools	177.0	20.3%	181.0	24.3%	(2.2%)
Bilingual Schools	198.4	27.5%	146.2	22.5%	35.7%
Kindergartens	28.7	7.7%	133.6	27.0%	(78.5%)
Overseas Schools	(45.3)	(5.4%)	(39.8)	(21.9%)	13.9%
Education Technology	31.2	30.2%	33.2	47.4%	(5.9%)
Complementary Education	48.1	10.5%	50.5	12.0%	(4.7%)
Unallocated Corporate Expenses	(130.4)	–	(204.2)	–	(36.2%)
Total	307.7	9.1%	300.5	11.7%	2.4%

Operating income for the fiscal year was RMB307.7 million, representing a 2.4% increase from RMB300.5 million for the last fiscal year. Operating margin was 9.1% for the fiscal year, as compared to 11.7% for the last fiscal year.

Adjusted operating income for the fiscal year was RMB420.0 million, representing an 11.9% increase from RMB375.5 million for the last fiscal year. Adjusted operating margin was 12.5% for the fiscal year, as compared to 14.6% for the last fiscal year.

Net Income and Adjusted Net Income

Net income for the fiscal year was RMB164.2 million, as compared to RMB252.8 million for the last fiscal year.

Adjusted net income for the fiscal year was RMB267.7 million, as compared to RMB322.6 for the last fiscal year.

Earnings per ordinary share/ADS and Adjusted Earnings per ordinary share/ADS

Basic and diluted earnings per ordinary share/ADS attributable to ordinary shareholders/ADS holders for the fiscal year were RMB1.34 and RMB1.34, respectively, as compared to earnings per share of RMB1.97 and RMB1.97, respectively, for the last fiscal year.

Adjusted basic and diluted earnings per ordinary share/ADS attributable to ordinary shareholders/ADS holders for the fiscal year were RMB2.20 and RMB2.20, respectively, as compared to earnings per share of RMB2.54 and RMB2.54, respectively, for the last fiscal year.

Adjusted EBITDA

Adjusted EBITDA for the fiscal year was RMB670.8 million, representing a 36.5% increase from RMB491.6 million for the last fiscal year.

Cash and Working Capital

As of August 31, 2020, the Company’s cash and cash equivalents and restricted cash were RMB4,423.9 million (US$646.1 million), as compared to RMB2,092.0 million as of May 31, 2020. As of August 31, 2020, we also have short-term investments of RMB13.7 million (US$2.0 million). For the fiscal year ended August 31, 2020, the Company’s capital expenditure was approximately RMB 149.8 million, down 3.5% compared to the last fiscal year.

GUIDANCE FOR FISCAL YEAR ENDING AUGUST 31, 2021

For the fiscal year 2021, the Company currently expects its revenue to be in a range of RMB3.77 billion and RMB3.87 billion, representing a year-over-year growth of 12% to 15%, and its average student enrolment in our domestic and overseas schools to be between approximately 56,000 and 57,000, representing a year-over-year increase of 8% to 10%.

This guidance is based on the current market and operating conditions and reflects the Company’s current and preliminary estimates of such market and operating conditions and market demand, which are all subject to change.

Conference Call

BEDU’s management will host a conference call at 8:00 am US Eastern Time (9:00 pmBeijing/Hong Kong Time) on November 12, 2020 to discuss its quarterly results and recent business activities.

To participate in the conference call, please dial the following number five to ten minutes prior to the scheduled conference call time:

Mainland China:	4001-201-203
Hong Kong:	852-301-84992
United States:	1-888-346-8982
Canada Toll Free:	1-855-669-9657
International:	1-412-902-4272

*No passcode is required for the call. Please request to join Bright Scholar Education Holdings Ltd.’s call as you dial in.

The Company will also broadcast a live audio webcast of the conference call. The webcast will be available at http://ir.brightscholar.com/.

Following the earnings conference call, an archive of the call will be available by dialling:

United States:	1-877-344-7529
International:	1-412-317-0088
Canada Toll Free:	855-669-9658
Replay Passcode:	10149104
Replay End Date:	November 19, 2020

CONVENIENCE TRANSLATION

The Company’s business is primarily conducted in China and the significant majority of revenue generated are denominated in Renminbi (“RMB”). However, periodic reports made to shareholders will include current period amounts translated into U.S. dollars using the prevailing exchange rates at the balance sheet date, for the convenience of readers. Translations of balances in the condensed consolidated balance sheets, and the related condensed consolidated statements of operations, and cash flows from RMB into U.S. dollars as of and for the quarter and fiscal year 2020 ended August 31, 2020 are solely for the convenience of the readers and were calculated at the rate of US$1.00=RMB6.8474, representing the noon buying rate set forth in the H.10 statistical release of the U.S. Federal Reserve Board on August 31, 2020. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at that rate on August 31, 2020 or at any other rate.

NON-GAAP FINANCIAL MEASURES

In evaluating our business, we consider and use certain non-GAAP measures, including primarily adjusted EBITDA, adjusted net income/(loss), adjusted gross profit/(loss), adjusted SG&A, adjusted operating income/(loss), adjusted earnings/(loss) per share attributable to ordinary shareholders basic and diluted as supplemental measures to review and assess our operating performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. We define adjusted gross profit/(loss) as gross profit/(loss) excluding amortization of intangible assets and adjusted gross margin as adjusted gross profit/(loss) divided by revenue. We define adjusted EBITDA as net income/(loss) excluding interest income/(expense), net; income tax expense/benefit; depreciation and amortization; share-based compensation expense; impairment loss on operating lease right-of-use assets; impairment loss on goodwill, and adjusted EBITDA margin as adjusted EBITDA divided by revenue. We define adjusted net income/(loss) as net income/(loss) excluding share-based compensation expense; amortization of intangible assets; tax effect of amortization of intangible assets; impairment loss on operating lease right-of-use assets; impairment loss on goodwill, and adjusted net margin as adjusted net income/(loss) divided by revenue. We define adjusted SG&A as selling, general and administration expense excluding share-based compensation expense. We define adjusted operating income/(loss) as net operating income/(loss) excluding share-based compensation expense; amortization of intangible assets; impairment loss on operating lease right-of-use assets; impairment loss on goodwill and adjusted operating margin as adjusted operating income/(loss) divided by revenue. Additionally, we define adjusted earnings/(loss) per share attributable to ordinary shareholders, basic and diluted, as adjusted net income/(loss) attributable to ordinary shareholders (net income/(loss) to ordinary shareholders excluding share-based compensation expense; amortization of intangible assets; tax effect of amortization of intangible assets; impairment loss on operating lease right-of-use assets and impairment loss on goodwill) divided by the weighted average number of basic and diluted ordinary shares or American depositary shares (each an “ADS”), each representing one Class A ordinary share of the Company, on an as-converted basis.

We incur amortization expense of intangible assets related to various acquisitions that have been made in recent years. These intangible assets are valued at the time of acquisition and are then amortized over a period of several years after the acquisition. We believe that exclusion of these expenses allows greater comparability of operating results that are consistent over time for the Company’s newly-acquired and long-held business as the related intangibles does not have significant connection to the growth of the business. Therefore, we provide exclusion of amortization of intangible assets to redefine adjusted operating income/(loss), adjusted net income/(loss), and adjusted earnings/(loss) per share attributable to ordinary shareholders, basic and diluted.

We present the non-GAAP financial measures because they are used by our management to evaluate our operating performance and formulate business plans. Such non-GAAP measures include adjusted EBITDA, adjusted net income/(loss), adjusted gross profit/(loss), adjusted SG&A, adjusted operating income/(loss), adjusted earnings/(loss) per share attributable to ordinary shareholders basic and diluted. Non-GAAP financial measures enable our management to assess our operating results without considering the impact of non-cash charges, including depreciation and amortization and share-based compensation expense, and without considering the impact of non-operating items such as interest income/(expense), net; income tax expense/benefit; share-based compensation expense; amortization of intangible assets; tax effect of amortization of intangible assets; impairment loss on operating lease right-of-use assets and impairment loss on goodwill. We also believe that the use of these non-GAAP measures facilitates investors’ assessment of our operating performance.

The non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. The non-GAAP financial measures have limitations as analytical tools. One of the key limitations of using these non-GAAP financial measures is that they do not reflect all items of income and expense that affect our operations. Interest income/(expense), net; income tax expense/benefit; depreciation and amortization; and share-based compensation expense, have been and may continue to be incurred in our business and are not reflected in the presentation of these non-GAAP measures, including adjusted EBITDA or adjusted net income/(loss). Further, these non-GAAP measures may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited.

About Bright Scholar Education Holdings Limited

Bright Scholar is a global premier education service company, dedicated to providing quality international education to global students and equipping them with the critical academic foundation and skillsets necessary to succeed in the pursuit of higher education. Bright Scholar also complements its international offerings with Chinese government-mandated curriculum for students who wish to maintain the option of pursuing higher education in China. As of August 31, 2020, Bright Scholar operated 81 schools across ten provinces in China and eight schools overseas, covering the breadth of K-12 academic needs of its students. In the fiscal year ended August 31, 2020, Bright Scholar had an average of 51,825 students enrolled at its schools.

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, the Company’s business plans and development, which can be identified by terminology such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. Such statements are based upon management’s current expectations and current market and operating conditions and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company’s control, which may cause the Company’s actual results, performance or achievements to differ materially from those in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in the Company’s filings with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

IR Contact:

GCM Strategic Communications
Email: [email protected]

Media Contact:
Email: [email protected]
Phone: +86-757-6683-2507

BRIGHT SCHOLAR EDUCATION HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)

			As of
			August 31,	August 31,
			2019	2020
			RMB	RMB	USD
ASSETS
	Current assets
		Cash and cash equivalents	3,246,995	3,377,684	493,280
		Restricted cash	18,019	1,044,853	152,591
		Short-term investments	241,270	13,695	2,000
		Accounts receivable	21,528	19,271	2,814
		Amounts due from related parties	10,652	18,521	2,705
		Other receivables, deposits and other assets	177,150	198,593	29,003
		Inventories	26,234	28,013	4,091
	Total current assets		3,741,848	4,700,630	686,484

		Restricted cash – non current	–	1,400	204
		Property and equipment, net	899,510	1,076,590	157,226
		Land use rights, net	88,204	86,076	12,571
		Intangible assets, net	552,011	597,527	87,263
		Goodwill	2,090,078	2,284,109	333,573
		Long-term investments	28,455	55,137	8,052
		Prepayment for construction contract	5,251	4,822	704
		Deferred tax assets, net	30,333	35,678	5,210
		Deposit for acquisition	338,585	–	–
		Other non-current assets	13,362	16,654	2,432
		Operating lease right-of-use assets	–	1,964,686	286,924
	Total non-current assets		4,045,789	6,122,679	894,159
TOTAL ASSETS			7,787,637	10,823,309	1,580,643

BRIGHT SCHOLAR EDUCATION HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS-CONTINUED
(Amounts in thousands)

			As of
			August 31,	August 31,
			2019	2020
			RMB	RMB	USD
LIABILITIES AND EQUITY
	Current liabilities
		Accounts payable (including accounts payable of the consolidated VIEs without recourse to Bright Scholar Education of RMB 32,842 and RMB 28,691 as of August 31, 2019 and August 31, 2020, respectively)	94,295	93,090	13,595
		Amounts due to related parties (including amounts due to related parties of the consolidated VIEs without recourse to Bright Scholar Education of RMB 76,117 and RMB 52,567 as of August 31, 2019 and August 31, 2020, respectively)	110,038	86,563	12,642
		Accrued expenses and other current liabilities (including accrued expenses and other current liabilities of the consolidated VIEs without recourse to Bright Scholar Education of RMB 364,734 and RMB 393,247 as of August 31, 2019 and August 31, 2020, respectively)	615,082	633,397	92,500
		Short term loan (including short term loan of the consolidated VIEs without recourse to Bright Scholar Education of nil and RMB 7,500 as of August 31, 2019 and August 31, 2020, respectively)	50,000	938,300	137,030
		Income tax payable (including income tax payable of the consolidated VIEs without recourse to Bright Scholar Education of RMB 50,968 and RMB 51,521 as of August 31, 2019 and August 31, 2020, respectively)	93,479	118,716	17,337
		Contract liabilities (including contract liabilities of the consolidated VIEs without recourse to Bright Scholar Education of RMB 1,157,774 and RMB 1,291,781 as of August 31, 2019 and August 31, 2020, respectively)	1,529,137	1,544,184	225,514
		Refund liabilities (including refund liabilities of the consolidated VIEs without recourse to Bright Scholar Education of RMB 19,132 and RMB 23,804 as of August 31, 2019 and August 31, 2020, respectively)	20,259	70,711	10,327
		Operating lease liabilities (including operating lease liabilities of the consolidated VIEs without recourse to Bright Scholar Education of nil and RMB 30,601 as of August 31, 2019 and August 31, 2020, respectively)	–	210,082	30,681
	Total current liabilities		2,512,290	3,695,043	539,626
		Non-current portion of deferred revenue (including non-current portion of deferred revenue of the consolidated VIEs without recourse to Bright Scholar Education of nil and RMB 1,772 as of August 31, 2019 and August 31, 2020, respectively)	–	1,772	259
		Deferred tax liabilities, net (including deferred tax liabilities of the consolidated VIEs without recourse to Bright Scholar Education of RMB 35,895 and RMB 34,641 as of August 31, 2019 and August 31, 2020, respectively)	53,689	57,826	8,445
		Other non-current liability due to related parties (including non- current liabilities due to related parties of the consolidated VIEs without recourse to Bright Scholar Education of RMB 21,736 and RMB 26,843 as of August 31, 2019 and August 31, 2020, respectively)	21,736	26,843	3,920
		Other non-current liability due to third parties (including non- current liabilities due to third parties of the consolidated VIEs without recourse to Bright Scholar Education of RMB 7,621 and RMB 18,368 as of August 31, 2019 and August 31, 2020, respectively)	10,654	19,612	2,864
		Bonds payable	2,106,000	2,017,369	294,618
		Long term loan (including long term loan of the consolidated VIEs without recourse to Bright Scholar Education of nil and RMB 77,500 as of August 31, 2019 and August 31, 2020, respectively)	–	77,919	11,379
		Operating lease liabilities (including operating lease liabilities of the consolidated VIEs without recourse to Bright Scholar Education of nil and RMB 189,354 as of August 31, 2019 and August 31, 2020, respectively)	–	1,802,544	263,245
	Total non-current liabilities		2,192,079	4,003,885	584,730
	TOTAL LIABILITIES		4,704,369	7,698,928	1,124,356

			As of
			August 31,	August 31,
			2019	2020
			RMB	RMB	USD
EQUITY
		Share capital	8	8	1
		Additional paid-in capital	2,105,189	1,854,262	270,798
		Statutory reserves	64,945	65,567	9,575
		Accumulated other comprehensive income	78,955	185,371	27,072
		Accumulated retained earnings	472,339	632,722	92,403
	Shareholders’ equity		2,721,436	2,737,930	399,849
	Non-controlling interests		361,832	386,451	56,438
	Total equity		3,083,268	3,124,381	456,287
TOTAL LIABILITIES AND EQUITY			7,787,637	10,823,309	1,580,643

BRIGHT SCHOLAR EDUCATION HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except for shares and per share data)

	Three Months Ended August 31,			Twelve Months Ended August 31,
	2019	2020		2019	2020
	RMB	RMB	USD	RMB	RMB	USD
Revenue	711,560	652,119	95,236	2,563,005	3,366,503	491,647
Cost of revenue	(499,453)	(502,664)	(73,409)	(1,586,014)	(2,144,786)	(313,226)
Gross profit	212,107	149,455	21,827	976,991	1,221,717	178,421
Selling, general and administrative expenses	(259,963)	(262,617)	(38,353)	(691,900)	(871,154)	(127,224)
Other operating income	3,428	22,778	3,327	15,435	38,661	5,646
Impairment loss on operating lease right-of-use assets	–	(12,772)	(1,866)	–	(12,772)	(1,866)
Impairment loss on goodwill	–	(68,723)	(10,036)	–	(68,723)	(10,036)
Operating (loss)/income	(44,428)	(171,879)	(25,101)	300,526	307,729	44,941
Interest (expense)/income, net	(8,036)	(53,048)	(7,747)	24,254	(159,352)	(23,272)
Investment income	1,678	52,105	7,609	17,414	106,675	15,579
Other expenses	(2,814)	(8,615)	(1,258)	(8,617)	(11,291)	(1,649)
(Loss)/Income before income taxes and share of equity in loss of unconsolidated affiliates	(53,600)	(181,437)	(26,497)	333,577	243,761	35,599
Income tax benefit/(expense)	5,696	33,176	4,845	(80,580)	(78,992)	(11,536)
Share of equity in loss of unconsolidated affiliates	(222)	(343)	(50)	(239)	(595)	(87)
Net (loss)/income	(48,126)	(148,604)	(21,702)	252,758	164,174	23,976
Net income attributable to non-controlling interests	3,798	5,234	764	11,659	3,169	463
Net (loss)/incomeattributable to ordinary shareholders	(51,924)	(153,838)	(22,466)	241,099	161,005	23,513
Net (loss)/earnings per share attributable to
ordinary shareholders
—Basic	(0.43)	(1.29)	(0.19)	1.97	1.34	0.20
—Diluted	(0.43)	(1.29)	(0.19)	1.97	1.34	0.20

Weighted average shares used in
calculating net (loss)/earnings per ordinary share:
—Basic	120,585,274	119,641,203	119,641,203	122,322,894	120,158,001	120,158,001
—Diluted	120,645,073	119,641,203	119,641,203	122,430,457	120,158,001	120,158,001

BRIGHT SCHOLAR EDUCATION HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)

	Three Months Ended August 31,			Twelve Months Ended August 31,
	2019	2020		2019	2020
	RMB	RMB	USD	RMB	RMB	USD
Net cash generated from operating activities	682,471	685,176	100,063	864,988	491,227	71,739
Net cash (used in)/generated from investing activities	(1,418,471)	1,829,279	267,149	(2,256,009)	72,567	10,598
Net cash generated from/(used in) financing activities	1,946,754	(112,211)	(16,387)	1,479,533	675,703	98,680
Effect of exchange rate changes on cash	(2,820)	(70,281)	(10,264)	12,421	(80,574)	(11,767)
Net change in cash and cash equivalents, and restricted cash	1,207,934	2,331,963	340,561	100,933	1,158,923	169,250
Cash and cash equivalents, and restricted cash at beginning of the period	2,057,080	2,091,974	305,514	3,164,081	3,265,014	476,825
Cash and cash equivalents, and restricted cash at end of the period	3,265,014	4,423,937	646,075	3,265,014	4,423,937	646,075

Reconciliations of GAAP and Non-GAAP Results
(Amounts in thousands, except for shares and per share data)

		Three Months Ended August 31,			Twelve Months Ended August 31,
		2019	2020		2019	2020
		RMB	RMB	USD	RMB	RMB	USD

Gross profit		212,107	149,455	21,827	976,991	1,221,717	178,421
	Add: Amortization of intangible assets	9,452	8,556	1,250	23,284	41,447	6,053
Adjusted gross profit		221,559	158,011	23,077	1,000,275	1,263,164	184,474

Operating (loss)/income		(44,428)	(171,879)	(25,101)	300,526	307,729	44,941
	Add: Share-based compensation expense	6,599	1,406	205	51,664	(10,631)	(1,553)
	Add: Amortization of intangible assets	9,452	8,556	1,250	23,284	41,447	6,053
	Add: Impairment loss on operating lease right-of-use assets	–	12,772	1,866	–	12,772	1,866
	Add: Impairment loss on goodwill	–	68,723	10,036	–	68,723	10,036
Adjusted operating (loss)/income		(28,377)	(80,422)	(11,744)	375,474	420,040	61,343

Net (loss)/income		(48,126)	(148,604)	(21,702)	252,758	164,174	23,976
	Add: Share-based compensation expense	6,599	1,406	205	51,664	(10,631)	(1,553)
	Add: Amortization of intangible assets	9,452	8,556	1,250	23,284	41,447	6,053
	Add: Tax effect of amortization of intangible assets	(2,056)	(1,874)	(274)	(5,123)	(8,822)	(1,288)
	Add: Impairment loss on operating lease right-of-use assets	–	12,772	1,866	–	12,772	1,866
	Add: Impairment loss on goodwill	–	68,723	10,036	–	68,723	10,036
Adjusted net (loss)/income		(34,131)	(59,021)	(8,619)	322,583	267,663	39,090

Net (loss)/income attributable to ordinary shareholders		(51,924)	(153,838)	(22,466)	241,099	161,005	23,513
	Add: Share-based compensation expense	6,599	1,406	205	51,664	(10,631)	(1,553)
	Add: Amortization of intangible assets	9,452	8,556	1,250	23,284	41,447	6,053
	Add: Tax effect of amortization of intangible assets	(2,056)	(1,874)	(274)	(5,123)	(8,822)	(1,288)
	Add: Impairment loss on operating lease right-of-use assets	–	12,772	1,866	–	12,772	1,866
	Add: Impairment loss on goodwill	–	68,723	10,036	–	68,723	10,036
Adjusted net (loss)/income attributable to ordinary shareholders		(37,929)	(64,255)	(9,383)	310,924	264,494	38,627

Net (loss)/income		(48,126)	(148,604)	(21,702)	252,758	164,174	23,976
	Less: Interest (expense)/income, net	(8,036)	(53,048)	(7,747)	24,254	(159,352)	(23,272)
	Add: Income tax (benefit)/expense	(5,696)	(33,176)	(4,845)	80,580	78,992	11,536
	Add: Depreciation and amortization	43,177	47,196	6,893	130,819	197,425	28,832
	Add: Share-based compensation expense	6,599	1,406	205	51,664	(10,631)	(1,553)
	Add: Impairment loss on operating lease right-of-use assets	–	12,772	1,866	–	12,772	1,866
	Add: Impairment loss on goodwill	–	68,723	10,036	–	68,723	10,036
Adjusted EBITDA		3,990	1,365	200	491,567	670,807	97,965

Selling, general and administrative expenses		259,963	262,617	38,353	691,900	871,154	127,224
	Less: Share-based compensation expense	6,599	1,406	205	51,664	(10,631)	(1,553)
Adjusted selling, general and administrative expenses		253,364	261,211	38,148	640,236	881,785	128,777

Weighted averageshares used in calculating (loss)/earnings per ordinary share:
—Basic		120,585,274	119,641,203	119,641,203	122,322,894	120,158,001	120,158,001
—Diluted		120,645,073	119,641,203	119,641,203	122,430,457	120,158,001	120,158,001

Adjusted net (loss)/earnings per share attributable to ordinary shareholders
—Basic		(0.31)	(0.54)	(0.08)	2.54	2.20	0.32
—Diluted		(0.31)	(0.54)	(0.08)	2.54	2.20	0.32

View original content:http://www.prnewswire.com/news-releases/bright-scholar-announces-unaudited-financial-results-for-the-fourth-fiscal-quarter-301170912.html

SOURCE Bright Scholar Education Holdings Ltd.

November 11, 2020 6:03 pm

Bragar Eagel & Squire, P.C. Reminds Investors That Class Action Lawsuits Have Been Filed Against Loop Industries, Turquoise Hill Resources, Reta Pharmaceuticals, and Evolus and Encourages Investors to Contact the Firm

NEW YORK, Nov. 11, 2020 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, P.C., a nationally recognized shareholder rights law firm, reminds investors that class actions have been commenced on behalf of stockholders of Loop Industries, Inc. (NASDAQ: LOOP), Turquoise Hill Resources Ltd. (NYSE: TRQ), Reata Pharmaceuticals, Inc. (NASDAQ: RETA), and Evolus, Inc. (NASDAQ: EOLS). Stockholders have until the deadlines below to petition the court to serve as lead plaintiff. Additional information about each case can be found at the link provided.

Loop Industries, Inc. (NASDAQ: LOOP)

Class Period: September 24, 2018 to October 12, 2020

Lead Plaintiff Deadline: December 14, 2020

On October 13, 2020, Hindenburg Research published a report alleging, among other things, that “Loop’s scientists, under pressure from CEO Daniel Solomita, were tacitly encouraged to lie about the results of the company’s process internally.” The report also stated that “Loop’s previous claims of breaking PET down to its base chemicals at a recovery rate of 100% were ‘technically and industrially impossible,’” according to a former employee. Moreover, the report alleged that “Executives from a division of key partner Thyssenkrupp, who Loop entered into a ‘global alliance agreement’ with in December 2018, told us their partnership is on ‘indefinite’ hold and that Loop ‘underestimated’ both costs and complexities of its process.”

On this news, the Company’s share price fell $3.78, or over 32%, to close at $7.83 per share on October 13, 2020.

The complaint, filed on October 13, 2020, alleges that throughout the Class Period defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, defendants failed to disclose to investors: (1) that Loop scientists were encouraged to misrepresent the results of Loop’s purportedly proprietary process; (2) that Loop did not have the technology to break PET down to its base chemicals at a recovery rate of 100%; (3) that, as a result, the Company was unlikely to realize the purported benefits of Loop’s announced partnerships with Indorama and Thyssenkrupp; and (4) that, as a result of the foregoing, defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

For more information on the Loop class action go to: https://bespc.com/cases/Loop

Turquoise Hill Resources Ltd. (NYSE: TRQ)

Class Period: July 17, 2018 to July 31, 2019

Lead Plaintiff Deadline: December 14, 2020

Turquoise Hill is an international mining company focused on the operation and development of the Oyu Tolgoi copper-gold mine in Southern Mongolia (“Oyu Tolgoi”), which is the Company’s principal and only material resource property. Turquoise Hill’s subsidiary, Oyu Tolgoi LLC, holds a 66% interest in Oyu Tolgoi, and the remainder is held by the Government of Mongolia.

Rio Tinto plc and Rio Tinto Limited are operated and managed together as single economic unit and engage in mining and metals operations in approximately 35 countries. Through their subsidiaries, Rio Tinto owns 50.8% of Turquoise Hill. A Rio Tinto subsidiary, Rio Tinto International Holdings, Inc. (“Rio Tinto International” or “RTIH”; and collectively with Rio Tinto plc and Rio Tinto Limited, “Rio Tinto”), is also the manager of the Oyu Tolgoi project, including having responsibility for its development and construction.

On July 31, 2019, Turquoise Hill issued a press release and Management Discussion & Analysis (“MD&A”) making further disclosures about the status of the project, including that Turquoise Hill took a $600 million impairment charge and a substantial “deferred income tax recognition adjustment” tied to the Oyu Tolgoi project, and that it suffered a loss in the second quarter. The next day, before the market open, Rio Tinto issued a release concerning in part the project status, including that it had also taken an impairment charge related to the Oyu Tolgoi project, of $800 million.

Following this news, on August 1, 2019, Turquoise Hill’s common stock price closed at $0.53 per share, down 8.62% from the prior day’s closing price of $0.58 per share.

The complaint, filed on October 15, 2020, alleges that throughout the Class Period defendants made materially false and misleading statements and omitted to disclose material facts regarding the Company’s business and operations. Specifically, defendants made false and or misleading statements and/or failed to disclose that: (i) the progress of underground development of Oyu Tolgoi was not proceeding as planned; (ii) there were significant undisclosed underground stability issues that called into question the design of the mine, the projected cost and timing of production; (iii) the Company’s publicly disclosed estimates of the cost, date of completion and dates for production from the underground mine were not achievable; (iv) the development capital required for the underground development of Oyu Tolgoi would cost substantially more than a billion dollars over what the Company had represented; and (v) Turquoise Hill would require additional financing and/or equity to complete the project.

For more information on the Turquoise Hill class action go to: https://bespc.com/cases/TRQ

Reata Pharmaceuticals, Inc. (NASDAQ: RETA)

Class Period: October 15, 2019 to August 7, 2020

Lead Plaintiff Deadline: December 14, 2020

Reata is a clinical stage biopharmaceutical company that develops novel therapeutics for patients with serious or life-threatening diseases by targeting molecular pathways that regulate cellular metabolism and inflammation.

Among Reata’s drug candidates under development is omaveloxolone, which is in Phase 2 clinical development to treat Friedreich’s ataxia (“FA”). Following the announcement of positive data from the MOXIe Part 2 study of omaveloxolone for FA in October 2019, the Company represented that it would seek submission for marketing approval of omaveloxolone for the treatment of FA in the U.S. with the U.S. Food and Drug Administration (“FDA”).

On August 10, 2020, Reata issued a press release announcing its second quarter 2020 financial results, wherein it disclosed that the FDA is “not convinced that the MOXIe Part 2 results” of the Company’s study assessing omaveloxolone for the treatment of FA “will support a single study approval without additional evidence that lends persuasiveness to the results,” and that, “[i]n preliminary comments for [a] meeting, the FDA stated that [Defendants] will need to conduct a second pivotal trial that confirms the mFARS [modified Friedreich’s Ataxia Rating Scale] results of the MOXIe Part 2 study with a similar magnitude of effect.”

On this news, Reata’s stock price fell $51.79 per share, or 33.16%, to close at $104.41 per share on August 10, 2020.

The Complaint, filed on October 15, 2020, alleges that throughout the Class Period defendants made materially false and misleading statements regarding the Company’s business. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) the MOXIe Part 2 study results were insufficient to support a single study marketing approval of omaveloxolone for the treatment of FA in the U.S. without additional evidence; (ii) as a result, it was foreseeable that the FDA would not accept marketing approval of omaveloxolone for the treatment of FA in the U.S. based on the MOXIe Part 2 study results; and (iii) as a result, the Company’s public statements were materially false and misleading at all relevant times.

For more information on the Reata class action go to: https://bespc.com/cases/REATA

Evolus, Inc. (NASDAQ: EOLS)

Class Period: February 1, 2019 to July 6, 2020

Lead Plaintiff Deadline: December 15, 2020

Beginning in February 2019, Evolus embarked on a public campaign to hype the market right before the commercial launch of its sole leading product Jeuveau™. To secure an aggressive growth and an rapid influx of revenue, Evolus disseminated dozens of public statements in which they promoted Jeuveau™ as a proprietary formulation of the botulinum toxic type A complex, purportedly developed by Korean bioengineering company Daewoong through years of clinical research and millions of dollars’ worth of investment in research and development. Among other things, Evolus promised investors that it would attain the number two U.S. market position within 24 months of launch.

The investing public learned the real truth about Jeuveau™ on July 6, 2020 when the U.S. International Trade Commission (“ITC”) issued its Initial Final Determination in a case brought by Allergan and Medytox against Evolus, alleging that Evolus stole certain trade secrets to develop Jeuveau™. Coming as a great surprise to the unsuspecting investors, the ITC Judge found that Evolus misappropriated the botulinum toxin strain as well as the manufacturing processes that led to its development and manufacture. To make things even more catastrophic, the ITC Judge recommended a ten-year long ban on Evolus’ ability to import Jeuveau™ into the United States and a ten-year long cease and desist order preventing Evolus from selling Jeuveau™ in the United States.

On this news Evolus’s share price declined sharply, falling 37% over the course of two trading days, to close at $3.35 on July 8, 2020. Following the news of the ITC’s Initial Final Determination and the subsequent price drop of Evolus’s common shares, several securities analysts downgraded Evolus’s rating and significantly lowered the Company’s price target.

The complaint, filed on October 16, 2020, alleges that throughout the Class period defendants made materially false and misleading statements, and failed to disclose material adverse facts about the Company’s business, operational, and compliance policies. Specifically, defendants made false and/or misleading statements and failed to disclose to investors that: (i) the real source of botulinum toxin bacterial strain as well as the manufacturing processes used to develop Jeuveau™ originated with and were misappropriated from Medytox; (ii) sufficient evidentiary support existed for the allegations that Evolus misappropriated certain trade secrets relating to the botulin toxin strain and the manufacturing processes for the development of Jeuveau™; (iii) as a result, Evolus faced a real threat of regulatory and/or court action, prohibiting the import, marketing, and sale of Jeuveau™; which in turn (iv) seriously threatened Evolus’ ability to commercialize Jeuveau™ in the United States and generate revenue; and (v) any revenues generated from the sale of Jeuveau™ were based on Evolus’ unlawful activities, including the misappropriation of trade secrets and secret manufacturing processes belonging to Allergan and Medytox.

For more information on the Evolus class action go to: https://bespc.com/cases/EOLS

About Bragar Eagel & Squire, P.C.:

Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York and California. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.

Contact Information:

Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
Marion Passmore, Esq.
(212) 355-4648
[email protected]
www.bespc.com

November 11, 2020 6:03 pm

Western Union to Present at the Citi Financial Technology Conference

Western Union to Present at the Citi Financial Technology Conference

DENVER–(BUSINESS WIRE)–
The Western Union Company (NYSE: WU), a global leader in cross-border, cross-currency money movements and payments, today announced that the Company will present at the Citi Financial Technology Conference on Monday, November 16, 2020. The presentation will begin at 3:00 p.m. Eastern time and will include comments from Raj Agrawal, CFO.

Investors and interested parties will be able to listen to the investor presentation via webcast from http://www.westernunion.com, under the investor relations section. The archived webcast will be available shortly after the conclusion of the presentation.

About Western Union

The Western Union Company (NYSE: WU) is a global leader in cross-border, cross-currency money movement and payments. Our omnichannel platform connects the digital and physical worlds and makes it possible for consumers and businesses to send and receive money and make payments with speed, ease, and reliability. As of September 30, 2020, our network included over 550,000 retail agent locations offering our branded services in more than 200 countries and territories, with the capability to send money to billions of accounts. Additionally, westernunion.com, our fastest growing channel in 2019, is available in over 75 countries, plus additional territories, to move money around the world. With our global reach, Western Union moves money for better, connecting family, friends, and businesses to enable financial inclusion and support economic growth. For more information, visit www.westernunion.com.

WU-G

View source version on businesswire.com: https://www.businesswire.com/news/home/20201111005909/en/

Media Relations:

Pia De Lima

+1 (954) 260-5732

[email protected]

Investor Relations:

Brendan Metrano

+1 (720) 332-8089

[email protected]

KEYWORDS: Colorado United States North America

INDUSTRY KEYWORDS: Technology Professional Services Other Technology Finance

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November 11, 2020 5:59 pm

FADU Technology Awarded Best of Show – Most Innovative Flash Memory Startup – by Flash Memory Summit 2020 for its Gen4 Flash Storage Platform

FADU introduced its next-generation DELTA storage solutions at FMS20 for NVMe 1.4/PCIe Gen4 x 4 performance for OEM and Hyperscale Data Center Storage

SANTA CLARA, Calif., Nov. 11, 2020 (GLOBE NEWSWIRE) — FADU Technology is a fabless startup developing advanced flash storage technology to meet the ever-increasing data storage demands placed on OEM and hyperscale data centers. The company announced that the Best of Show judging panel of the Flash Memory Summit 2020 selected FADU for the Best of Show – Most Innovative Memory Startup award.

The Flash Memory Summit, the World’s leading storage industry conference and exposition, recognized FADU’s FC4121 Flash Controller and DELTA SSDs as exciting products from a promising Flash Memory startup.

“SSD controllers are the heartbeat for delivering a high performance of storage products and the future of IT infrastructure requires a quality of service (QoS) to meet the extreme data demands placed on on-premise and cloud data centers,” said Jay Kramer, Chairman of the Awards Program and President of Network Storage Advisors Inc. “We are proud to recognize the FADU Flash Memory Controller and DELTA SSDs designed to support dual-port and large capacities while optimizing latency for a QoS storage solution.

“Hyperscale, enterprise, and storage applications demand high performance, low power and an open architecture for their storage solutions,” said Jay Kramer, Chairman of the Awards Program and President of Network Storage Advisors Inc. “We are proud to recognize the FADU Flash Memory Controller and DELTA SSDs designed to support dual-port connectivity, low power efficiency and industry-standard form factors of U.2, E1.S, and M.2 storage solution.”

FADU, founded in 2015, focuses on Flash storage solutions for hyperscale & edge storage and enterprise data center servers & storage. The DELTA Gen4 Platform, consisting of FADU DELTA SSDs and the FADU FC4121 Flash Controller, supports NVMe 1.4 and PCIe Gen4 x4, PCIe Gen4 x2, PCIe Gen3 x4, and PCIe Gen3 x2. The SSDs are compliant with OCP Cloud Spec 1.0, support Dual-Port, and deliver deep Queues and high QOS. SSD designs are offered for E1.S and U.2 form factors today in capacities up to 16TB and will add M.2 and E3 form factors and capacities up to 64TB in 2021. Low power and high performance, hallmarks of FADU solutions, push the SSDs to an industry-leading 1675 KIOPs for Random Read and 450 KIOPs for Random Write.

“We’re honored to have our hard work and dedication to advancing Flash storage recognized by the Flash Memory Summit”, said Jihyo Lee, FADU’s CEO and co-founder. “Our approach enables us to develop leading-edge SSDs with peak performance, such as the Gen4 E1.S SSD, while keeping power under the specified envelope, eliminating the need to throttle devices to manage thermals,” Lee continued.

FADU’s DELTA SSDs, which are qualified with NAND Flash memory from SK hynix, Seagate, Micron and KIOXIA, will be ready for OEM qualification in Q1-2021 and commercialization in Q2-2021. OEMs can purchase DELTA SSD designs and the FC4121 controller to design their own devices; have turnkey designs with customized micro-code to manufacture their own devices; or have FADU customize and manufacture private-labeled, ready-to-sell SSDs using NAND consigned from the OEMs.

For more information about the FADU DELTA Gen4 Platform, visit FADU at https://www.fadutec.com/products/delta.

About FADU Technology
FADU Technology is a fabless startup developing advanced flash storage technology to meet the explosively increasing data storage demands placed on hyperscale, enterprise, and cloud data centers. Our innovative SSD solutions are based on industry-standard specifications, designed with FADU’s proprietary Flash Memory Controller architecture, and compatibility with multiple industry NAND suppliers. FADU’s storage designs address all aspects of Flash-based storage – very low power, ultra-high performance, rich feature sets, solid reliability, and superior QOS. The company believes that other solutions, with legacy ties to the past, are unable to meet the performance and power requirements to support real-time, cloud-based, connected applications. FADU’s global team, of seasoned storage architects, ASIC experts, and SSD engineers, is charting the course for the industry. Learn more at www.fadu.io and follow FADU on Twitter and LinkedIn.

Media Relations:

Carol Warren
[email protected]

Corporate:

Anu Murthy, VP of Marketing
[email protected]
(408) 714-9301

November 11, 2020 5:57 pm

Superior Plus Corp. Announces Third Quarter 2020 Results

Superior Plus Corp. Announces Third Quarter 2020 Results

Superior confirms 2020 Adjusted EBITDA and Total Debt to Adjusted EBITDA leverage guidance and remains focused on executing its acquisition growth strategy

TORONTO–(BUSINESS WIRE)–
Superior Plus Corp. (“Superior”) (TSX:SPB) announced today the financial and operating results for the third quarter ended September 30, 2020. Unless otherwise expressed, all financial figures are expressed in Canadian dollars.

“During the third quarter, we closed the preferred share investment from Brookfield and used the proceeds to reduce our debt and execute two retail propane acquisitions in our current footprint in the U.S. Northeast,” said Luc Desjardins, President and Chief Executive Officer. “Subsequent to quarter end, we made two more retail propane acquisitions in California and the Eastern U.S., further demonstrating our robust pipeline of acquisition opportunities and our ability to execute on acquisitions, even in the current environment.”

“Superior delivered improved third quarter results in our U.S. and Canadian propane distribution businesses driven primarily by lower operating costs,” continued Mr. Desjardins. “Our Specialty Chemicals business results were lower due to continued weakness in the caustic soda and hydrochloric acid markets. We are maintaining our Adjusted EBITDA guidance as our businesses continue to demonstrate resiliency, and we remain focused on creating sustainable earnings growth for the future. Our residential and industrial sales volumes in Canada are relatively consistent with prior year, and we have seen a similar trend in our residential and commercial propane sales volumes in the U.S.”

“I am proud of the way our employees have quickly adapted to the situation and continue to provide our customers with high-quality services and products in a safe manner,” added Mr. Desjardins.

Business and Financial Highlights

Superior achieved third quarter Adjusted EBITDA of $39.1 million, a $9.1 million or 19% decrease over the prior year quarter primarily due to lower EBITDA from operations in Specialty Chemicals and higher corporate costs, partially offset by higher EBITDA from operations in U.S. propane distribution (“U.S. Propane”) and Canadian propane distribution (“Canadian Propane”), and a realized gain on foreign currency hedging contracts compared to a realized loss in the prior year quarter.
EBITDA from Operations during the third quarter was $45.9 million, a $7.7 million or a 14% decrease from the prior year quarter primarily due to lower results from Specialty Chemicals, partially offset by higher results from U.S. Propane and Canadian Propane. Please see below for further discussion on the third quarter EBITDA from Operations by business.
AOCF before transaction and other costs during the third quarter was $12.5 million, a $6.7 million or 35% decrease compared to the prior year quarter primarily due to lower Adjusted EBITDA and higher cash tax expense, partially offset by lower interest expense. AOCF before transaction and other costs per share was $0.06, $0.05 lower than the prior year quarter for the same reasons and an increase in weighted average shares outstanding. Weighted average shares outstanding increased primarily due to the impact of including the preferred shares on an as-converted basis and shares issued through the Dividend Reinvestment and Optional Share Repurchase Plan.
Superior had net losses of $21.4 million in the third quarter, a $37.9 million increase compared to the prior year quarter primarily due to an unrealized gain on derivative financial instruments and lower selling, distribution and administrative costs (“SD&A”) in the current quarter compared to the prior year quarter, partially offset by lower gross profit.
Net cash flows from operating activities in the third quarter were $17.2 million, a $22.0 million decrease from the prior year quarter primarily due to reduced cashflow from changes in non-cash operating working capital compared to the prior year quarter and to a lesser extent the impact of lower net earnings net of non-cash adjustments. Changes in non-cash operating working capital are impacted by timing of sales, customer receipts and purchases of goods and services.
U.S. Propane EBITDA from operations for the third quarter was ($4.0) million, an increase of $3.0 million or 43% compared to the prior year quarter primarily due to lower operating expenses, the incremental contribution from the tuck-in acquisitions completed in the past 12 months and higher average unit margins, partially offset by lower sales volumes. Total sales volumes decreased 3 million litres or 2% primarily due to the impact of COVID-19 and lower commercial distillate sales volumes, partially offset by incremental volumes from acquisitions. Average sales margin for the third quarter was 36.4 cents per litre compared to 34.7 cents per litre in the prior year quarter primarily due to sales and marketing initiatives, customer mix and the impact of the weaker Canadian dollar on the translation of U.S. denominated gross profit. Operating expenses were $64.5 million, a decrease of $2.2 million or 3% compared to the prior year quarter due to cost reductions, workforce optimization initiatives and realized synergies from acquisitions, partially offset by the impact of the weaker Canadian dollar on the translation of U.S. denominated expenses.
Canadian Propane achieved EBITDA from operations for the third quarter of $21.6 million, an increase of $0.7 million or 3% compared to the prior year quarter primarily due to lower operating expenses, partially offset by lower average margins and lower sales volumes. Operating costs were $39.1 million, a decrease of $15.9 million or 29% primarily due to lower employee-related expenses, including the impact of the Canadian Emergency Wage Subsidy (“CEWS”), and cost-saving initiatives. In the third quarter, Canadian Propane recorded a $13.7 million benefit related to the CEWS. Average propane sales margins in the third quarter were 16.9 cents per litre compared to 18.4 cents per litre in the prior year quarter due to weaker wholesale market fundamentals compared to the prior year quarter. Total sales volumes were 341 million litres, a decrease 52 million litres or 13%, primarily due to reduced oilfield drilling activity in Western Canada and the impact of COVID-19.
Specialty Chemicals EBITDA from operations for the third quarter was $28.3 million, a decrease of $11.4 million or 29% compared to the prior year quarter primarily due to lower gross profit, partially offset by lower operating expenses. Gross profit decreased $14.1 million due to lower chlor-alkali sales prices and volumes and lower sodium chlorate sales volumes, partially offset by higher sodium chlorate sales prices and modestly lower electricity mill rates. Chlor-alkali sales prices and volumes were lower primarily due to weaker hydrochloric and caustic soda market fundamentals. Sodium chlorate sale volumes were lower primarily due to weaker printing paper demand and the impact of customer mill outages. Operating expenses were $27.9 million, a $3.2 million decrease primarily due to lower employee-related expenses, including the impact of the CEWS. In the third quarter, Specialty Chemicals recorded a $3.6 million benefit related to the CEWS, which positively impacted cost of goods sold and operating expenses.
Superior’s corporate operating and administrative costs for the third quarter were $7.1 million, an increase of $3.2 million primarily due to the higher long-term incentive plan costs related to the appreciation in Superior’s share price. In the third quarter, Superior recorded a $0.3 million benefit related to the CEWS, which impacted the corporate operating expenses.

Financial Overview
	Three Months Ended				Nine Months Ended
	September 30				September 30
(millions of dollars, except per share amounts)		2020		2019		2020		2019
Revenue		399.4		450.1		1,690.4		2,031.9
Gross Profit		166.3		195.0		785.3		847.0
Net earnings (loss)		(21.4)		(59.3)		(2.5)		68.0
Net earnings (loss) for the period attributable to common shareholders		(26.8)		(59.3)		(7.9)		68.0
Net earnings for the period attributable to non-controlling interest		5.4		–		5.4		–
Net earnings (loss) per share ⁽¹⁾	$	(0.15)	$	(0.34)	$	(0.05)	$	0.39
EBITDA from operations ⁽²⁾		45.9		53.6		346.7		374.3
Adjusted EBITDA ⁽²⁾		39.1		48.2		326.1		347.8
Net cash flows from operating activities		17.2		39.2		289.6		314.9
Net cash flows from operating activities per share ⁽¹⁾	$	0.09	$	0.22	$	1.57	$	1.80
AOCF before transaction and other costs ⁽²⁾⁽³⁾		12.5		19.2		241.2		261.2
AOCF before transaction and other costs per share ^(1)(2)(3)	$	0.06	$	0.11	$	1.31	$	1.49
AOCF ⁽²⁾		6.3		13.1		224.6		236.9
AOCF per share ⁽¹⁾⁽²⁾	$	0.03	$	0.07	$	1.22	$	1.35
Cash dividends declared		31.8		31.4		94.8		94.4
Cash dividends declared per share	$	0.18	$	0.18	$	0.54	$	0.54

(1)		The weighted average number of shares outstanding for the three and nine months ended September 30, 2020 was 201.8 million and 184.2 million, respectively (three and nine months ended September 30, 2019 was 174.9 million). The weighted average number of shares assumes the conversion of the preferred shares into common shares. There were no other dilutive instruments with respect to AOCF per share and AOCF before transaction and other costs per share for the three and nine months ended September 30, 2020 and 2019.
(2)		EBITDA from operations, Adjusted EBITDA and AOCF are non-GAAP measures. Refer to “Non-GAAP Financial Measures” for further details and the Third Quarter Management Discussion & Analysis (“MD&A”) for reconciliations.
(3)		Transaction and other costs for the three months ended September 30, 2020 and 2019 are related to acquisition activity and the integration of acquisitions. See “Transaction and Other Costs” for further details.

Segmented Information
			Three Months Ended			Nine Months Ended
			September 30			September 30
	(millions of dollars)			2020	2019		2020	2019
	EBITDA from operations⁽¹⁾
		Canadian Propane Distribution		21.6	20.9		129.4	125.2
		U.S. Propane Distribution		(4.0)	(7.0)		126.5	131.2
		Specialty Chemicals		28.3	39.7		90.8	117.9
				45.9	53.6		346.7	374.3

(1)

See “Non-GAAP Financial Measures”.

Brookfield Investment

On July 13, 2020, Superior issued 260,000 perpetual exchangeable preferred shares (the “Preferred Shares”) in its wholly owned subsidiary Superior Plus US Holdings Inc. for gross proceeds of US$260 million (the “Brookfield Investment”) to an affiliate of Brookfield Asset Management Inc. (“Brookfield”), on a private placement basis. The Preferred Shares entitle the holders to a monthly dividend at a current rate of 7.25% per annum through to the end of Superior’s second fiscal quarter in 2027, and may be exchanged, at Brookfield’s option, into common shares of Superior at an exchange price of US $8.67 per common share (or approximately CDN $11.63 ⁽¹⁾per common share). On an as-exchanged basis, the Brookfield Investment currently represents approximately 15% of the pro forma fully diluted outstanding common shares.

Superior used the proceeds of the Brookfield Investment to reduce the credit facility debt.

Business Development and Acquisition Update

On August 3, 2020, Superior acquired the assets of a retail propane distribution company, operating under the tradename, Champagne’s Energy (“Champagne”), for total consideration of approximately US$27.4 million (CDN $36.7 million). The purchase price was paid primarily with cash from Superior’s credit facility. Champagne is a retail distributor delivering approximately 41.0 million litres of propane and distillates annually to residential and commercial customers in Maine.

On September 1, 2020, Superior acquired the assets of a retail propane and heating oil distribution company, operating under the tradename, Rymes Propane and Oil (“Rymes”), for total consideration of approximately US$151.6 million (CDN $198.0 million). The purchase price was paid primarily with cash from Superior’s credit facility. Rymes is a retail distributor delivering approximately 204.0 million litres of propane and distillates annually to residential and commercial customers in New Hampshire, Maine, Massachusetts and Vermont.

On October 15, 2020, Superior acquired all of the equity interests of a Southern California propane distribution company, operating under the tradename, Central Coast Propane (“Central Coast”), for total consideration of approximately US$12.9 million (CDN $16.8 million). The purchase price was paid primarily with cash from Superior’s credit facility. Central Coast is a retail distributor delivering approximately 5.0 million litres of propane to approximately 2,800 residential and commercial customers in Southern California.

On October 27, 2020, Superior acquired the assets of a retail propane distribution company, operating under the tradename, Petro Home Services (“Petro”), for total consideration of approximately US$6.1 million (CDN $8.1 million). The purchase price was paid primarily with cash from Superior’s credit facility. Petro is a retail distributor delivering approximately 11.0 million litres of propane annually to 11,000 customers in North Carolina, South Carolina, Georgia and Tennessee.

Adjusted EBITDA Guidance and Leverage Update

Superior’s outlook for 2020 remains unchanged, with expected Adjusted EBITDA in the previously disclosed guidance range of $475 million to $515 million. Average weather, as measured by degree days for the remainder of 2020 is anticipated to be consistent with the five-year average for Canada and the U.S.

Superior remains focused on managing both its debt and its leverage ratio. Superior’s Total Debt to Adjusted EBITDA leverage ratio for the trailing twelve months was 3.4x as at September 30, 2020, compared to 3.7x at June 30, 2020 and December 31, 2019. The decrease in the leverage ratio from June 30, 2020 and December 31, 2019 was primarily due to lower debt, partially offset by higher Pro Forma Adjusted EBITDA related to acquisitions made during the trailing-twelve months.

Superior’s Total Debt as at September 30, 2020, was $1,849.0 million, a decrease of $32.7 million from June 30, 2020 and $107.1 million from December 31, 2019. The decrease from June 30, 2020 was primarily due to the proceeds from the Brookfield Investment, which were used to reduce the credit facility, partially offset by the acquisition of Rymes and Champagne, which were funded primarily using the credit facility.

Superior is well within its covenants under its credit facility agreement and unsecured note indentures. Superior’s Senior debt to Credit Facility EBITDA ratio was 3.4x as at September 30, 2020, and cannot exceed 5.0x. Superior also had available liquidity of $381.0 million available under the credit facility as at September 30, 2020.

Superior expects Total Debt to Adjusted EBITDA at December 31, 2020 to be in the range of 3.0x to 3.5x, consistent with the previously disclosed guidance range and consistent with Superior’s long-term range.

MD&A and Financial Statements

Superior’s MD&A, the unaudited Condensed Interim Consolidated Financial Statements and the Notes to the Condensed Interim Consolidated Financial Statements for the three and nine months ended September 30, 2020 provide a detailed explanation of Superior’s operating results. These documents are available online at Superior’s website at www.superiorplus.com under the Investor Relations section and on SEDAR under Superior’s profile at www.sedar.com.

2020 Third Quarter Conference Call

Superior will be conducting a conference call and webcast for investors, analysts, brokers and media representatives to discuss the Third Quarter Results at 10:30 a.m. EST on Thursday, November 12, 2020. To participate in the call, dial: 1-844-389-8661. Internet users can listen to the call live, or as an archived call on Superior’s website at www.superiorplus.com under the Events section.

Non-GAAP Financial Measures

Throughout the third quarter earnings release, Superior has used the following terms that are not defined by International Financial Reporting Standards (“Non-GAAP Financial Measures”), but are used by management to evaluate the performance of Superior and its business: AOCF before and after transaction and other costs, earnings before interest, taxes, depreciation and amortization (“EBITDA”) from operations, Adjusted EBITDA, operating expenses, Total Debt to Adjusted EBITDA leverage ratio and Pro Forma Adjusted EBITDA. These measures may also be used by investors, financial institutions and credit rating agencies to assess Superior’s performance and ability to service debt. Non-GAAP financial measures do not have standardized meanings prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies. Securities regulations require that Non-GAAP financial measures are clearly defined, qualified and reconciled to their most comparable GAAP financial measures. Except as otherwise indicated, these Non-GAAP financial measures are calculated and disclosed on a consistent basis from period to period. Specific items may only be relevant in certain periods. See “Non-GAAP Financial Measures” in the MD&A for a discussion of Non-GAAP financial measures and certain reconciliations to GAAP financial measures.

The intent of Non-GAAP financial measures is to provide additional useful information to investors and analysts, and the measures do not have any standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate Non-GAAP financial measures differently. Investors should be cautioned that AOCF, EBITDA from operations, Adjusted EBITDA and Credit Facility EBITDA should not be construed as alternatives to net earnings, cash flow from operating activities or other measures of financial results determined in accordance with GAAP as an indicator of Superior’s performance. Non-GAAP financial measures are identified and defined as follows:

Adjusted Operating Cash Flow and Adjusted Operating Cash Flow per Share

AOCF is equal to cash flow from operating activities as defined by IFRS, adjusted for changes in non-cash working capital, other expenses, non-cash interest expense, current income taxes and finance costs. Superior may deduct or include additional items in its calculation of AOCF; these items would generally, but not necessarily, be infrequent in nature and could distort the analysis of trends in business performance. Excluding these items does not imply they are non-recurring. AOCF and AOCF per share are presented before and after transaction and other costs.

AOCF per share before transaction and other costs is calculated by dividing AOCF before transaction and other costs by the weighted average number of shares outstanding. AOCF per share is calculated by dividing AOCF by the weighted average number of shares outstanding.

AOCF is a performance measure used by management and investors to evaluate Superior’s ongoing performance of its businesses and ability to generate cash flow. AOCF represents cash flow generated by Superior that is available for, but not necessarily limited to, changes in working capital requirements, investing activities and financing activities of Superior.

The seasonality of Superior’s individual quarterly results must be assessed in the context of annualized AOCF. Adjustments recorded by Superior as part of its calculation of AOCF include, but are not limited to, the impact of the seasonality of Superior’s businesses, principally the Energy Distribution segment, by adjusting for non-cash working capital items, thereby eliminating the impact of the timing between the recognition and collection/payment of Superior’s revenues and expenses, which can differ significantly from quarter to quarter. AOCF is reconciled to cash flow from operating activities. Please refer to the Financial Overview section of the MD&A for the reconciliation.

Adjusted EBITDA

Adjusted EBITDA represents earnings before interest, taxes, depreciation, amortization, losses (gains) on disposal of assets, finance expense, restructuring costs, transaction and other costs, and unrealized gains (losses) on derivative financial instruments. Adjusted EBITDA is used by Superior and investors to assess its consolidated results and ability to service debt. Adjusted EBITDA is reconciled to net earnings before income taxes.

Adjusted EBITDA is a significant performance measure used by management and investors to evaluate Superior’s ongoing performance of its businesses. Adjusted EBITDA is also used as one component in determining short-term incentive compensation for certain management employees.

The seasonality of Superior’s individual quarterly results must be assessed in the context of annualized Adjusted EBITDA.

EBITDA from operations

EBITDA from operations is defined as Adjusted EBITDA excluding costs that are not considered representative of Superior’s underlying core operating performance, including gains and losses on foreign currency hedging contracts, corporate costs and transaction and other costs. Management uses EBITDA from operations to set targets for Superior (including annual guidance and variable compensation targets). EBITDA from operations is reconciled to net earnings before income taxes. Please refer to the Results of Operating Segments in the MD&A for the reconciliations.

Operating Expenses

Operating expenses include wages and benefits for employees, drivers, service and administrative labour, fleet maintenance and operating costs, freight and distribution expenses excluded from cost of sales, along with the costs associated with owning and maintaining land, buildings and equipment, such as rent, repairs and maintenance, environmental, utilities, insurance and property tax costs. Operating expenses exclude gains or losses on disposal of assets, depreciation and amortization and non-recurring expenses, such as transaction, restructuring and integration costs.

Operating expenses are defined as SD&A expenses adjusted for amortization and depreciation, gains or losses on disposal of assets and transaction, restructuring and other costs.

Total Debt to Adjusted EBITDA Leverage Ratio and Pro Forma Adjusted EBITDA

Adjusted EBITDA for the Total Debt to Adjusted EBITDA Leverage Ratio is defined as Adjusted EBITDA calculated on a 12-month trailing basis giving pro forma effect to acquisitions and dispositions adjusted to the first day of the calculation period (“Pro Forma Adjusted EBITDA”). Pro Forma Adjusted EBITDA is used by Superior to calculate its Total Debt to Adjusted EBITDA Leverage Ratio.

To calculate the Total Debt to Adjusted EBITDA Leverage Ratio divide the sum of borrowings before deferred financing fees and lease liabilities by Pro Forma Adjusted EBITDA. Total Debt to Adjusted EBITDA Leverage Ratio is used by Superior and investors to assess its ability to service debt.

Forward Looking Information

Certain information included herein is forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking information may include statements regarding the objectives, business strategies to achieve those objectives, expected financial results (including those in the area of risk management), economic or market conditions, and the outlook of or involving Superior, Superior LP and its businesses. Such information is typically identified by words such as “anticipate”, “believe”, “continue”, “estimate”, “expect”, “plan”, “forecast”, “future”, “outlook, “guidance”, “may”, “project”, “should”, “strategy”, “target”, “will” or similar expressions suggesting future outcomes.

Forward-looking information in this document includes: future financial position, consolidated and business segment outlooks, expected Adjusted EBITDA, the duration and anticipated impact of the COVID-19 pandemic and the expected economic recession, estimates of the impact COVID-19 may have on our operations, the markets for our products and our financial results, expected Total Debt to Adjusted EBITDA ratio, anticipated impact from the weaker Canadian dollar, business strategy and objectives, development plans and programs, organic growth, weather, economic activity in Western Canada, product pricing and sourcing, caustic soda and hydrochloric acid markets, caustic potash customer mix, volumes and pricing, wholesale propane market fundamentals, electricity costs, exchange rates, improvements and the timing associated in North American chlor-alkali markets, expected seasonality of demand, and future economic conditions.

Forward-looking information is provided for the purpose of providing information about management’s expectations and plans about the future and may not be appropriate for other purposes. Forward-looking information herein is based on various assumptions and expectations that Superior believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct. Those assumptions and expectations are based on information currently available to Superior, including information obtained from third party industry analysts and other third party sources, and the historic performance of Superior’s businesses. Such assumptions include anticipated financial performance, current business and economic trends, the amount of future dividends paid by Superior, business prospects, utilization of tax basis, regulatory developments, currency, exchange and interest rates, future commodity prices relating to the oil and gas industry, future oil rig activity levels, trading data, cost estimates, our ability to obtain financing on acceptable terms, expected life of facilities and statements regarding net working capital and capital expenditure requirements of Superior or Superior LP, the assumptions set forth under the “Financial Outlook” sections of our MD&A. The forward looking information is also subject to the risks and uncertainties set forth below.

By its very nature, forward-looking information involves numerous assumptions, risks and uncertainties, both general and specific. Should one or more of these risks and uncertainties materialize or should underlying assumptions prove incorrect, as many important factors are beyond our control, Superior’s or Superior LP’s actual performance and financial results may vary materially from those estimates and intentions contemplated, expressed or implied in the forward-looking information. These risks and uncertainties include incorrect assessments of value when making acquisitions, increases in debt service charges, the loss of key personnel, the anticipated impact of the COVID-19 pandemic and the expected economic recession, fluctuations in foreign currency and exchange rates, inadequate insurance coverage, liability for cash taxes, counterparty risk, compliance with environmental laws and regulations, reduced customer demand, operational risks involving our facilities, force majeure, labour relations matters, our ability to access external sources of debt and equity capital, and the risks identified in (i) our MD&A under the heading “Risk Factors” and (ii) Superior’s most recent Annual Information Form. The preceding list of assumptions, risks and uncertainties is not exhaustive.

When relying on our forward-looking information to make decisions with respect to Superior, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Any forward-looking information is provided as of the date of this document and, except as required by law, neither Superior nor Superior LP undertakes to update or revise such information to reflect new information, subsequent or otherwise. For the reasons set forth above, investors should not place undue reliance on forward-looking information.

(1)

The CDN $11.63 conversion price is based on the USDCAD rate at the time of the Brookfield Investment.

For more information about Superior, visit our website at www.superiorplus.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201111005913/en/

Beth Summers ExecutiveVice President and Chief Financial Officer

Phone: (416) 340-6015

Rob Dorran Vice President, Investor Relations and Treasurer

Phone: (416) 340-6003

Toll Free: 1-866-490-PLUS (7587)

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Other Energy Chemicals/Plastics Utilities Oil/Gas Manufacturing Energy Other Natural Resources Mining/Minerals Natural Resources

MEDIA:

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Posted on November 11, 2020 5:51 pm
Allegro MicroSystems, Inc. to Announce Second Quarter Fiscal Year 2021 Financial Results on Thursday, November 19, 2020

MANCHESTER, N.H., Nov. 11, 2020 (GLOBE NEWSWIRE) — Allegro MicroSystems, Inc. (Nasdaq: ALGM) today announced it will release financial results for the second quarter fiscal year 2020 prior to the market opening on Thursday, November 19, 2020. Following the press release, the Company will host a conference call at 8:30AM Eastern time, the same day. Ravi Vig, President and Chief Executive Officer, Paul Walsh, Senior Vice President, Finance & Administration and Chief Financial Officer will discuss ALGM’s results.

Analysts and investors are invited to join the conference call using the following information:

What: Allegro MicroSystems’ 2Q Fiscal 2021 Earnings Conference Call
When: Thursday, November 19, 2020
Time: 8:30 a.m. EST
Conference Dial-in: 1-833-665-0677
International Dial-in: 1-929-517-0172
Conference ID: 9562657

Live Webcast: https://edge.media-server.com/mmc/p/c23x96vz

An archived webcast of the conference call will be accessible via Allegro MicroSystems’ investor relations page: investors.allegromicro.com.

About Allegro
MicroSystems

Allegro MicroSystems is a leading global designer, developer, fabless manufacturer and marketer of sensor integrated circuits (“ICs”) and application-specific analog power ICs enabling emerging technologies in the automotive and industrial markets. Allegro’s diverse product portfolio provides efficient and reliable solutions for the electrification of vehicles, automotive ADAS safety features, automation for Industry 4.0 and power saving technologies for data centers and green energy applications.

Contact: Katherine Blye
Investor Relations
Phone: +1 603 626-2306
[email protected]

Posted on November 11, 2020 5:51 pm
Peyto Announces 1,000th Horizontal Well and Q3 2020 Financial Results

CALGARY, Alberta, Nov. 11, 2020 (GLOBE NEWSWIRE) — Peyto Exploration & Development Corp. (“Peyto” or the “Company”) is pleased to present its operating and financial results for the third quarter of the 2020 fiscal year. While the COVID-19 pandemic continued to grip the world and global energy markets, Peyto was able to safely continue conducting drilling operations, achieving a significant operational milestone in the Company’s 22 year history with the completion of its 1,000^th horizontal well. Results for the quarter included:

Funds from operations of $0.30/share. Generated $49 million in Funds From Operations (“FFO”) in Q3 2020, down from $68 million in Q3 2019 due to 14% lower realized commodity prices offset by 2% higher production levels.

Liquids production up 6%. Natural gas production increased 1% from 396 MMcf/d in Q3 2019 to 402 MMcf/d in Q3 2020 while Condensate and NGL production increased 6% from a year ago to 11,263 bbl/d. Liquid yields were 28 bbl/MMcf, up from 27 bbl/MMcf in Q3 2019, primarily due to new Cardium drilling. Total liquids production was comprised of 6,493 bbls/d of Condensate and Pentanes+, and 4,770 bbls/d of Propane and Butane. Total Q3 2020 production of 78,210 boe/d was up 2% from Q3 2019.

Total cash costs of $1.01/Mcfe ($0.87/Mcfe or $5.25/boe excluding royalties). Industry leading total cash costs, included $0.14/Mcfe royalties, $0.32/Mcfe operating costs, $0.16/Mcfe transportation, $0.04/Mcfe G&A and $0.35/Mcfe interest, and combined with a realized price of $2.15/Mcfe, resulting in a $1.14/Mcfe ($6.83/boe) cash netback, down 29% from $1.61/Mcfe ($9.65/boe) in Q3 2019. Operating costs per unit for Q3 2020 were up 3% from Q3 2019, largely due to increased power and chemical costs.

Capital investment of $62 million. A total of 18 gross wells (16.5 net) were drilled in the third quarter, 21 gross wells (19.5 net) were completed, and 21 gross wells (19.5 net) were brought on production. Over the last 12 months the 74 gross (67.35 net) wells brought on production accounted for approximately 24,000 boe/d at the end of the quarter, which, when combined with a trailing twelve month capital investment of $241 million, equates to an annualized capital efficiency of $10,000/boe/d. Peyto anticipates the 2020 full year capital efficiency will be approximately $9,000/boe/d based on continued drilling and completion cost improvements.

Dividends of $0.01/share, Loss of $0.07/share. Dividends of $1.6 million were paid to shareholders during the quarter while a loss of $11.3 million was recorded.

Third Quarter 2020 in Review
Peyto increased drilling activity in the third quarter, following spring break up, with four drilling rigs active across the Company’s Deep Basin core areas. On September 23, 2020 drilling commenced on the Company’s 1,000^th Deep Basin horizontal well at 14-01-054-19W5. The well was drilled to 4,250m measured depth with a 1,832m horizontal lateral in the Notikewin formation. Drilling was conducted by the Ensign #401 rig which has been drilling for Peyto for over 10 years without a single lost-time incident. The 14-01 well also set a new drilling pace record at Peyto, taking only 6.5 days from spud to total depth. The well is currently being completed as part of a multi-well pad site and will commence production shortly. Peyto has now drilled more horizontal wells in the Alberta Deep Basin than any other operator and continues to lead the industry in innovation, efficiency and safety while responsibly developing Alberta’s natural gas resources. Production grew from 76,000 boe/d at the start of the quarter to exit at 83,000 boe/d. Commodity prices also rebounded from Q2 2020 lows with NYMEX gas and WTI oil up 18% and 47%, respectively. Although Funds from Operations for the quarter were lower than Q3 2019, the higher commodity prices lifted FFO 49% from the previous quarter. Peyto maintained its industry leading low cash costs at $1.01/Mcfe which delivered a 53% Operating Margin¹. The Company anticipates that the recent improvement in natural gas prices and continued growth in production will significantly improve financial performance in the quarters ahead.

^{1. Operating Margin is defined as funds from operations divided by revenue before royalties but including realized hedging gains/losses.}

^{Natural gas volumes recorded in thousand cubic feet (mcf) are converted to barrels of oil equivalent (boe) using the ratio of six (6) thousand cubic feet to one (1) barrel of oil (bbl). Natural gas liquids and oil volumes in barrel of oil (bbl) are converted to thousand cubic feet equivalent (Mcfe) using a ratio of one (1) barrel of oil to six (6) thousand cubic feet. This could be misleading, particularly if used in isolation as it is based on an energy equivalency conversion method primarily applied at the burner tip and does not represent a value equivalency at the wellhead.}

Three Months Ended Sep 30 % Nine Months Ended Sep 30 %

2020 2019 Change 2020 2019 Change

Operations

Production

Natural gas (mcf/d) 401,680 396,343 1
% 401,692 426,648 -6
%

Oil & NGLs (bbl/d) 11,263 10,650 6
% 11,325 10,821 5
%

Thousand cubic feet equivalent (mcfe/d @ 1:6) 469,259 460,243 2
% 469,640 491,572 -4
%

Barrels of oil equivalent (boe/d @ 6:1) 78,210 76,707 2
% 78,273 81,929 -4
%

Production per million common shares (boe/d)* 474 465 2
% 475 497 -4
%

Product prices

Natural gas ($/mcf) 1.64 1.84 -11
% 1.57 2.07 -24
%

Oil & NGLs ($/bbl) 31.08 39.65 -22
% 29.73 44.87 -34
%

Operating expenses ($/mcfe) 0.32 0.31 3
% 0.36 0.34 6
%

Transportation ($/mcfe) 0.16 0.19 -16
% 0.17 0.19 -11
%

Field netback ($/mcfe) 1.53 1.97 -22
% 1.42 2.19 -35
%

General & administrative expenses ($/mcfe) 0.04 0.05 -20
% 0.04 0.05 -20
%

Interest expense ($/mcfe) 0.35 0.31 13
% 0.32 0.30 7
%

Financial ($000, except per share*)

Revenue and realized hedging gains (losses)¹ 92,853 105,944 -12
% 264,457 373,130 -29
%

Royalties 5,867 1,440 307
% 13,508 8,350 62
%

Funds from operations 49,173 68,106 -28
% 136,697 247,157 -45
%

Funds from operations per share 0.30 0.41 -28
% 0.83 1.50 -45
%

Total dividends 1,649 9,892 -83
% 13,191 29,677 -56
%

Total dividends per share 0.01 0.06 -83
% 0.08 0.18 -56
%

Payout ratio (%) 3 15 -80
% 10 12 -17
%

Earnings (loss) (11,285
) 6,275 -280
% (101,506
) 130,003 -178
%

Earnings (loss) per diluted share (0.07
) 0.04 -275
% (0.62
) 0.79 -179
%

Capital expenditures 61,568 36,574 68
% 167,454 133,080 26
%

Weighted average common shares outstanding 164,892,979 164,874,175 – 164,880,489 164,874,175 –

As at September 30

Net debt 1,183,754 1,133,869 4
%

Shareholders’ equity 1,573,825 1,721,158 -9
%

Total assets 3,515,148 3,587,612 -2
%

¹

excludes revenue from sale of third party volumes

Three Months Ended Sep 30 Nine Months Ended Sep 30

($000 except per share) 2020 2019 2020 2019

Cash flows from operating activities 48,074 64,913 150,169 241,993

Change in non-cash working capital 1,099 3,193 (13,472
) 2,873

Performance based compensation – – – 2,291

Funds from operations 49,173 68,106 136,697 247,157

Funds from operations per share 0.30 0.41 0.83 1.50

^{(1) Funds from operations – Management uses funds from operations to analyze the operating performance of its energy assets. In order to facilitate comparative analysis, funds from operations is defined throughout this report as earnings before performance based compensation, non‑cash and non‑recurring expenses. Management believes that funds from operations is an important parameter to measure the value of an asset when combined with reserve life. Funds from operations is not a measure recognized by Canadian generally accepted accounting principles (“GAAP”) and does not have a standardized meaning prescribed by GAAP. Therefore, funds from operations, as defined by Peyto, may not be comparable to similar measures presented by other issuers, and investors are cautioned that funds from operations should not be construed as an alternative to net earnings, cash flow from operating activities or other measures of financial performance calculated in accordance with GAAP. Funds from operations cannot be assured and future dividends may vary.}

Exploration & Development Activity

Third quarter 2020 drilling activity was spread throughout the Greater Sundance and Brazeau River areas and amongst both the liquids rich Cardium and drier Spirit River plays as shown in the following table:

Field Total Wells Drilled

Zone Sundance Nosehill Wildhay Ansell Whitehorse Kisku/

Kakwa Brazeau

Cardium 2 3 2 7

Viking 1 1

Notikewin 2 1 1 4

Falher 2 2

Wilrich 3 3

Bluesky 1 1

Total 9 3 3 3 18

Drilling and completion costs for the third quarter of 2020 continued their downward trend. Peyto expects 2020 drilling cost per meter and completion costs per stage will be the lowest in Company history. Repeated success with a new extended reach horizontal well design is contributing to the lower costs. No lost time incidents occurred in Q3 2020 as Peyto and its service providers safely executed operations in drilling, completions, pipelining, and facility installations all while dealing with the added concerns of the COVID-19 pandemic.

2013 2014 2015 2016 2017 2018 2019 2020
Q1 2020
Q2 2020
Q3 2020
YTD

Gross Hz Spuds 99 123 140 126 135 70 61 17 12 18 47

Measured Depth (m) 4,179 4,251 4,309 4,197 4,229 4,020 3,848 4,069 4,335 4,219 4,222

Drilling conducted ($MM/well) $2.72 $2.66 $2.16 $1.82 $1.90 $1.71 $1.62 $1.75 $1.69 $1.68 $
1.71

$ per meter $651 $626 $501 $433 $450 $425 $420 $430 $390 $398 $
404

Completion conducted ($MM/well) $1.63 $1.70 $1.21 $0.86 $1.00 $1.13 $1.01* $0.98 $0.97 $0.91 $
0.93

Hz Length MD-TVD (m) 1,409 1,460 1,531 1,460 1,241 1,348 1,484 1,563 1,587 1,720 1,632

$ per Hz Length (m) $1,153 $1,166 $792 $587 $803 $835 $679 $624 $610 $528 $
574

$ ‘000 per Stage $188 $168 $115 $79 $81 $51 $38 $38 $37 $34 $
36

^{*excluding Peyto’s Wildhay Montney well.}

Capital Expenditures

During the third quarter of 2020, Peyto invested 88% of total capital in well related expenditures, with $28.0 million in drilling, $20.1 million in completions and $6.0 million in wellsite equipment and tie-ins. A further $5.0 million was invested in facilities and major pipeline projects, and $2.5 million acquiring new land and seismic, for total capital investments of $61.6 million.

Peyto commissioned its Sundance water disposal well and associated pipeline during the quarter, along with several pipeline looping projects to debottleneck portions of the gathering system in the Greater Sundance area. This work, along with compressor upgrades and continued installation of reduced methane emission controllers, made up the majority of the $5 million in facility and pipeline expenditures. These reduced emission controllers have allowed Peyto to reduce it’s methane emissions per boe of production by over 40% from 2016.

Commodity Prices

During Q3 2020 Peyto sold 34% of its natural gas at AECO, 9% at Emerson, 5% at Ventura, and 52% at Henry Hub. Benchmark prices, Peyto realized prices, and aggregate gas marketing diversification costs are shown below. Moving forward, the Company expects to continue to market more of its gas at hubs outside of AECO but expects that market diversification costs will be significantly reduced over time.

Benchmark Commodity Prices

Three Months ended September 30

2020 2019

AECO 7A monthly ($/GJ) 2.04 0.99

AECO 5A daily ($/GJ) 2.12 0.86

Emerson2 (US$/MMBTU) 1.78 1.90

NYMEX (US$/MMbtu) 1.95 2.33

Ventura daily (US$/MMbtu) 1.80 2.00

Dawn daily (US$/MMbtu) 1.82 2.13

Canadian WTI ($/bbl) 54.50 74.55

Conway C3 (US$/bbl) 19.54 15.10

^{Q3 2020 average CND/USD exchange rate of 1.332}

Peyto Realized Commodity Prices by Component

Three Months ended September 30

2020 2019

Natural gas ($/mcf) 2.62 2.17

Gas marketing diversification activities ($/mcf) (1.01
) (0.70)

Gas hedging ($/mcf) 0.03 0.37

Oil, condensate and C5+ ($/bbl) 42.09 67.76

Butane and propane ($/bbl) 15.76 2.79

Oil and NGL hedging ($/bbl) (1.78
) 2.26

^{Liquids prices are Peyto realized prices in Canadian dollars adjusted for fractionation, transportation, and market differentials

.}

^{Peyto natural gas has an average heating value of approximately 1.15 GJ/mcf}

^{Details of Peyto’s ongoing marketing and diversification efforts are available on Peyto’s website at:}

^{http://www.peyto.com/Files/Operations/Marketing/hedges.pdf}

Financial Results

Approximately 36%, or $0.79/Mcfe, of Peyto’s unhedged revenue came from its associated condensate and natural gas liquids sales while 64%, or $1.38/Mcfe, is attributable to natural gas sales. Natural gas hedging increased revenue by $0.02/Mcfe while liquids hedging reduced revenue by $0.04/Mcfe for total revenue of $2.15/Mcfe. Cash costs of $1.01/Mcfe, included royalties of $0.14/Mcfe, operating costs of $0.32/Mcfe, transportation costs of $0.16/Mcfe, G&A of $0.04/Mcfe and interest costs of $0.35/Mcfe. Cash costs per unit of production were higher than Q3 2019 due to increased royalties and interest charges.

When the total cash costs of $1.01/Mcfe were deducted from realized revenues of $2.15/Mcfe, it resulted in a cash netback of $1.14/Mcfe or a 53% operating margin. Historical cash costs and operating margins are shown in the following table:

2017 2018 2019 2020

($/Mcfe) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Revenue 3.44 3.36 3.24 3.50 3.54 3.20 3.27 3.03 3.20 2.60 2.50 2.76 2.30 1.73 2.15

Royalties 0.19 0.17 0.09 0.15 0.17 0.10 0.14 0.12 0.14 0.01 0.03 0.12 0.12 0.06 0.14

Op Costs 0.29 0.24 0.26 0.28 0.29 0.30 0.31 0.33 0.35 0.34 0.31 0.34 0.39 0.36 0.32

Transportation 0.17 0.18 0.17 0.16 0.13 0.18 0.19 0.19 0.19 0.19 0.19 0.19 0.19 0.17 0.16

G&A 0.04 0.05 0.03 0.03 0.08 0.05 0.03 0.04 0.06 0.05 0.05 0.02 0.04 0.04 0.04

Interest
0.20 0.21 0.21 0.21 0.24 0.26 0.27 0.27 0.28 0.30 0.31 0.31 0.29 0.33
0.35

Cash Costs 0.89 0.85 0.76 0.83 0.91 0.89 0.94 0.95 1.02 0.89 0.89 0.98 1.03 0.96 1.01

Netback 2.55 2.51 2.48 2.67 2.63 2.31 2.33 2.08 2.18 1.71 1.61 1.78 1.27 0.77 1.14

Operating Margin 74% 75% 76% 76% 74% 72% 71% 69% 68% 66% 64% 65% 55% 45% 53
%

Depletion, depreciation, and amortization charges of $1.34/Mcfe, along with a provision for deferred tax and stock-based compensation payments reduced the cash netback to a loss of $0.26/Mcfe ($0.07/share). Dividends of $0.04/Mcfe ($0.01/share) were paid to shareholders in the quarter. No impairment charges were recorded in the quarter.

Activity Update

Peyto currently has 4 drilling rigs operating in the Greater Sundance and Brazeau core areas. These four rigs are scheduled to shut down in mid-December for the Christmas break but will resume drilling in early January. Since the end of the quarter, the Company has spud 11 wells, completed 10 wells, and brought on production 5 new wells. In addition, there are 7 wells at various stages of completion and tie-in.

Peyto’s recent efforts to increase horizontal lateral length and increase stimulation intensity has yielded impressive results across several areas and in several different formations. The 2020 capital program, so far, has achieved the lowest total drilling and completion cost per meter of stimulated reservoir, while still delivering superior production performance compared to previous years. This superior performance combined with the strong spot natural gas prices, has resulted in some of the highest rates of return achieved in the last five years. Historical costs and the average of the first six months of production are shown below.

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
YTD

Wells Drilled 70 86 99 123 140 126 135 70 61 47

Measured Depth (m) 4,041 4,017 4,179 4,251 4,309 4,197 4,229 4,020 3,848 4,222

Stimulated Hz Lateral (m) 1,138 1,123 1,264 1,269 1,287 1,224 1,241 1,377 1,351 1,500

Total Avg Drill & Complete ($MM/well) $4.50 $4.28 $4.36 $4.31 $3.28 $2.59 $2.78 $2.78 $2.46 $
2.63

D&C cost per meter of stimulated reservoir $3,954 $3,809 $3,445 $3,393 $2,549 $2,119 $2,236 $2,018 $1,823 $
1,753

Average IP180 (boe/d) 426 403 674 466 501 455 441 349 383 520

Recently, the Company has started gathering and processing 8 mmcf/d of third-party production into Peyto’s under-utilized Sundance infrastructure. This will generate incremental fee revenue to Peyto while allowing the third party to share in Peyto’s lower cost structure. The Company is continuing its efforts in this regard in areas where pipeline and plant infrastructure have spare capacity and will not impact Peyto’s current volumes and future plans.

2021 Budget

The improved well performance and recent strength in both NYMEX and AECO natural gas prices, combined with the continued reduction in Peyto’s drilling and completion costs, which has lowered the cost to add new production, significantly improves the Company’s return on invested capital. Consistent with year two of Peyto’s strategic three-year plan, the Board of Directors is currently examining a go-forward capital program that invests available free cashflow into resource development opportunities. While specifics of the 2021 budget are not yet finalized, a capital program of $300 to $350 million, funded entirely from free cashflow, is being contemplated, which could add a projected of 33,000-39,000 boe/d, based on current on-stream metrics. This volume addition would more than offset the annual forecast of approximately 25% base decline on anticipated 2020 exit production of 85,000 boe/d. The 2020 exit production and subsequent base decline will depend on the timing of year end activity.

Peyto believes it currently has all the necessary equipment and service providers in place to execute the proposed capital program and has demonstrated during the year an ability to conduct operations safely and efficiently during the COVID 19 pandemic. While this proposed capital program will be funded entirely from available free cashflow, it should result in production, cashflow and earnings growth, as well as bring total leverage metrics in line, allowing Peyto to exit its covenant relief period with lenders earlier than originally contemplated. In addition, by the end of 2021, a significant portion of Peyto’s production that had been exposed to higher cost AECO-NYMEX basis will be subject to much lower market diversification costs, resulting in improved gas price realizations. The subsequent growth in free cashflow beyond 2021 could then be used for further debt repayment and increased dividends.

As always, Peyto will ensure any capital plans will be nimble with the ability to react to changes in commodity prices and the global economic environment, both of which continue to be volatile and uncertain.

Management Change

Mr. Timothy Louie, Peyto’s Vice President of Land, will be retiring at the end of November 2020. On behalf of directors, staff, and shareholders of Peyto, management would like to sincerely thank Mr. Louie for his contributions to Peyto over the last 9 years and wish him all the best in his retirement.

Outlook

The Peyto business model has always been a simple one. Use technical expertise to invest capital into internally generated drilling projects that achieve the highest possible return on that capital. After 22 successful years of deploying this strategy, Peyto has built one of the highest quality, lowest cost natural gas asset bases in the industry. At times, this strategy requires patience as it takes time to build value and quality through the drill bit, but after $6.3 billion in cumulative capital investment to drill 663 vertical wells and over 1,000 horizontal wells, which have delivered $6.4 billion in cumulative funds from operations, this approach has proven to deliver.

Globally, the outlook for natural gas continues to strengthen in recognition that it will be a critical part of any transition to a larger, cleaner, and reliable energy complex. Peyto remains confident that demand for the products it is developing today, will only grow in the future.

Conference Call and Webcast

A conference call will be held with the senior management of Peyto to answer questions with respect to the 2020 third quarter financial results on Thursday, November 12th, 2020, at 9:00 a.m. Mountain Time (MT), or 11:00 a.m. Eastern Time (ET). To participate, please call 1-844-492-6041 (North America) or 1-478-219-0837 (International). Shareholders and interested investors are encouraged to ask questions about Peyto and its most recent results. Questions can be submitted prior to the call at [email protected]. The conference call can also be accessed through the internet https://edge.media-server.com/mmc/p/px5ts8gk. The conference call will be archived on the Peyto Exploration & Development website at www.peyto.com.

Management’s Discussion and Analysis/Financial Statements

A copy of the third quarter report to shareholders, including the MD&A, unaudited financial statements and related notes, is available at http://www.peyto.com/Files/Financials/2020/Q32020FS.pdf and at http://www.peyto.com/Files/Financials/2020/Q32020MDA.pdf and will be filed at SEDAR, www.sedar.com at a later date.

Darren Gee
President and CEO
November 11, 2020
Phone:   (403) 261-6081
Fax: (403) 451-4100

Cautionary Statements

Forward-Looking Statements

This news release contains certain forward-looking statements or information (“forward-looking statements”) as defined by applicable securities laws that involve substantial known and unknown risks and uncertainties, many of which are beyond Peyto’s control. These statements relate to future events or the Company’s future performance. All statements other than statements of historical fact may be forward-looking statements. The use of any of the words “plan”, “expect”, “prospective”, “project”, “intend”, “believe”, “should”, “anticipate”, “estimate”, or other similar words or statements that certain events “may” or “will” occur are intended to identify forward-looking statements. The projections, estimates and beliefs contained in such forward-looking statements are based on management’s estimates, opinions, and assumptions at the time the statements were made, including assumptions relating to: macro-economic conditions, including public health concerns (including the impact of the COVID-19 pandemic) and other geopolitical risks, the condition of the global economy and, specifically, the condition of the crude oil and natural gas industry including the collapse of global crude oil prices, other commodity prices and the decrease in global demand for crude oil in 2020, and the ongoing significant volatility in world markets; other industry conditions; changes in laws and regulations including, without limitation, the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; increased competition; the availability of qualified operating or management personnel; fluctuations in other commodity prices, foreign exchange or interest rates; stock market volatility and fluctuations in market valuations of companies with respect to announced transactions and the final valuations thereof; results of exploration and testing activities; and the ability to obtain required approvals and extensions from regulatory authorities. Management of the Company believes the expectations reflected in those forward-looking statements are reasonable, but no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that Peyto will derive from them. As such, undue reliance should not be placed on forward-looking statements. Forward-looking statements contained herein include, but are not limited to, statements regarding: the future outlook for realized commodity prices being better in the future than in the third quarter of 2020; the expectation that financial performance will significantly improve in the upcoming quarters; the expectation that the Company will continue to market more of its gas at hubs outside of AECO; the expectation that market diversification costs will diminish; the continued need for precautions to be taken to ensure the health and safety of all workers during the COVID-19 pandemic; the Company’s intention to offset higher interest charges under its credit facility with lower per unit operation and transportation costs resulting from a focused cost reduction program; the expectation that the four drilling rigs will be at full utilization in 2021 with an expanded capital program; the Company’s drilling and completion program for the remainder of 2020, including the timing of bringing on new wells in the remainder of 2020; the anticipated cost savings as a result of the newly commission water disposal well and facility; the anticipated additional cost savings to be realized in the balance of the year; the expectation for growing capital programs in 2021 and 2022; the expectation for producing reserve life to continue to grow and base production declines continue for future growth and profitability; the Company’s ability to continue to be nimble and flexible in adjusting its program for 2020 as required; 2020 capital efficiency; Peyto’s hedging program; and the Company’s overall strategy and focus.

The forward-looking statements contained herein are subject to numerous known and unknown risks and uncertainties that may cause Peyto’s actual financial results, performance or achievement in future periods to differ materially from those expressed in, or implied by, these forward-looking statements, including but not limited to, risks associated with: continued changes and volatility in general global economic conditions including, without limitations, the economic conditions in North America and public health concerns (including the impact of the COVID-19 pandemic); continued fluctuations and volatility in commodity prices, foreign exchange or interest rates; continued stock market volatility; imprecision of reserves estimates; competition from other industry participants; failure to secure required equipment; increased competition; the lack of availability of qualified operating or management personnel; environmental risks; changes in laws and regulations including, without limitation, the adoption of new environmental and tax laws and regulations and changes in how they are interpreted and enforced; the results of exploration and development drilling and related activities; and the ability to access sufficient capital from internal and external sources. In addition, to the extent that any forward-looking statements presented herein constitutes future-oriented financial information or financial outlook, as defined by applicable securities legislation, such information has been approved by management of Peyto and has been presented to provide management’s expectations used for budgeting and planning purposes and for providing clarity with respect to Peyto’s strategic direction based on the assumptions presented herein and readers are cautioned that this information may not be appropriate for any other purpose. Readers are encouraged to review the material risks discussed in Peyto’s annual information form for the year ended December 31, 2019 under the heading “Risk Factors” and in Peyto’s annual management’s discussion and analysis under the heading “Risk Management”.

The Company cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Peyto’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits Peyto will derive there from. The forward-looking statements, including any future-oriented financial information or financial outlook, contained in this news release speak only as of the date hereof and Peyto does not assume any obligation to publicly update or revise them to reflect new information, future events or circumstances or otherwise, except as may be required pursuant to applicable securities laws.

Barrels of Oil Equivalent

To provide a single unit of production for analytical purposes, natural gas production and reserves volumes are converted mathematically to equivalent barrels of oil (BOE). Peyto uses the industry-accepted standard conversion of six thousand cubic feet of natural gas to one barrel of oil (6 Mcf = 1 bbl). The 6:1 BOE ratio is based on an energy equivalency conversion method primarily applicable at the burner tip. It does not represent a value equivalency at the wellhead and is not based on current prices. While the BOE ratio is useful for comparative measures and observing trends, it does not accurately reflect individual product values and might be misleading, particularly if used in isolation. As well, given that the value ratio, based on the current price of crude oil to natural gas, is significantly different from the 6:1 energy equivalency ratio, using a 6:1 conversion ratio may be misleading as an indication of value.

Non-IFRS Measurements

Within this news release references are made to terms commonly used in the oil and gas industry. Funds from operations, funds from operations per share and netbacks do not have any standardized meaning under IFRS and previous GAAP and are referred to as non-IFRS measures. Funds from operations are described in footnote 1 to the first table on page 2 of this news release. Netbacks are a non-IFRS measure that represents the profit margin associated with the production and sale of petroleum and natural gas. Netbacks are per unit of production measures used to assess Peyto’s performance and efficiency. The primary factors that produce Peyto’s strong netbacks and high margins are a low cost structure and the high heat content of its natural gas that results in higher commodity prices. The Company’s calculation of the non-IFRS measures included herein may differ from the calculation of similar measures by other issuers. Therefore, the Company’s non-IFRS measures may not be comparable to other similar measures used by other issuers. Non-IFRS measures should only be used in conjunction with the Company’s annual audited and interim financial statements. A reconciliation of these measures can be found in Peyto’s management’s discussion and analysis for the three months ended September 30, 2020.

Posted on November 11, 2020 5:48 pm
Power Corporation Reports Third Quarter 2020 Financial Results

Canada NewsWire

Readers are referred to the sections “Non-IFRS Financial Measures and Presentation” and “Forward-Looking Statements” at the end of this release.

MONTRÉAL, Nov. 11, 2020 /CNW Telbec/ – Power Corporation of Canada (Power Corporation or the Corporation) (TSX: POW) today reported earnings results for the three and nine months ended September 30, 2020.

Power Corporation
Consolidated results for the period ended September 30

Highlights

The Corporation’s net asset value per share (a non-IFRS financial measure, see Non-IFRS Financial Measures and Presentation later in this news release) was $34.94 at September 30, 2020, compared with $32.96 at June 30, 2020, representing an increase of 6.0%.

August 17, 2020: Great-West Lifeco Inc. (Lifeco)’s subsidiary Empower Retirement completed the acquisition of Personal Capital Corporation (Personal Capital), a hybrid wealth manager that combines a leading-edge digital experience with personalized advice delivered by human advisors.

September 8, 2020: Empower Retirement announced that it entered into an agreement to purchase the retirement services business of Massachusetts Mutual Life Insurance Company (MassMutual), strengthening Empower Retirement’s position as the second-largest player in the U.S. retirement market.

September 17, 2020: Mackenzie Financial Corporation (Mackenzie) and Lifeco announced a strategic relationship with Northleaf Capital Partners Ltd. (Northleaf) to expand and enhance their private markets capabilities. The transaction was completed on October 29, 2020.

October 14, 2020: Wealthsimple Financial Corp. (Wealthsimple) announced the closing of a $114 million investment on a pre-money valuation of $1.4 billion.

October 23, 2020: Sagard Holdings Inc. (Sagard Holdings) completed the first closing of Sagard Credit Partners II, LP, its second credit fund. Sagard Credit Partners will continue fundraising activities through 2021.

IGM Financial Inc. (IGM) assets under management and advisement were a record high of $196.4 billion, up 4.3% from June 30, 2020 and 6.1% from September 30, 2019. Investment fund net sales were $610 million, compared with net sales of $103 million in the third quarter of 2019.

IGM reported net earnings of $191 million or $0.80 per share, compared with $202 million or $0.85 per share in the third quarter of 2019. Adjusted net earnings, excluding adjustments, were $214 million or $0.90 per share, compared with $202 million or $0.85 per share in the third quarter of 2019. This is the second highest adjusted earnings per share in IGM’s history.

Third Quarter
Net earnings attributable to participating shareholders were $505 million or $0.75 per share, compared with $359 million or $0.84 per share in 2019.

Adjusted net earnings attributable to participating shareholders(a non-IFRS financial measure, see Non-IFRS Financial Measures and Presentation later in this news release) were $438 million or $0.65 per share, compared with $308 million or $0.72 per share in 2019.

Contributions to Power Corporation’s earnings per share:

2020

^[1]

2019

^{(in dollars per Power Corporation share)}

Net Earnings

Adjusted Net
Earnings

Net Earnings

Adjusted Net
Earnings

Lifeco

0.82

0.67

0.73

0.67

IGM

0.18

0.20

0.19

0.19

Pargesa/GBL

(0.02)

(0.02)

0.05

0.06

Alternative investment platforms ^[2]

0.03

0.03

(0.01)

(0.01)

China AMC ^[3]

0.02

0.02

0.02

0.02

1.03

0.90

0.98

0.93

Corporate operations and Other ^[4]

(0.28)

(0.25)

(0.14)

(0.21)

0.75

0.65

0.84

0.72

Average shares outstanding

(in millions)

676.3

425.6

Lifeco: contribution to net earnings per share increased by 12%, contribution to adjusted net earnings per share was the same.
IGM: contribution to net earnings per share decreased by 5%, contribution to adjusted net earnings per share increased by 5%.
Pargesa/GBL (Pargesa Holding SA): results reflect the impact of COVID-19 on its portfolio as well as a charge of $0.06 per share in the quarter for losses due to an increase in the put right liability of the non-controlling interests in Webhelp, representing a charge of $0.06.
Corporate and Other: the third quarter includes a charge of $0.10 per share for the remeasurement of the put right liability of the non-controlling interests in Wealthsimple and carried interests payable, both due to the increase in the fair value of Wealthsimple.

As part of the Reorganization completed in February 2020, the Corporation anticipates significant near-term cost reductions of approximately $50 million per year within two years by eliminating duplicative public company-related expenses and rationalizing other general and administrative expenses. To date, the Corporation has implemented actions to achieve 47% of the targeted reduction.

Adjustments in the third quarter of 2020, excluded from adjusted net earnings, were a net positive impact to earnings of $67 million or $0.10 per share, mainly related to the Corporation’s share of Lifeco’s and IGM’s adjustments. Adjustments in the third quarter of 2019 were a net positive impact to earnings of $51 million or $0.12 per share, mainly related to the Corporation’s share of Lifeco’s and Pargesa’s adjustments and a favourable change to the Corporation’s income tax provision.

[1]

The Corporation completed a reorganization transaction on February 13, 2020 in which it acquired the minority interests of Power Financial (the Reorganization) and now holds 100% of the common shares in the capital of Power Financial.

[2]

Alternative investment platforms includes earnings (losses) from investment platforms including controlled and consolidated subsidiaries and other investments.

[3]

China Asset Management Co., Ltd.

[4]

Includes operating and other expenses, dividends on non-participating shares of the Corporation and its share of Power Financial’s corporate operations and consolidation entries; refer to the Earnings Summary below.

Nine Months
Net earnings attributable to participating shareholders were $1,371 million or $2.15 per share, compared with $929 million or $2.11 per share in 2019.

Adjusted net earnings attributable to participating shareholderswere $1,316 million or $2.06 per share, compared with $918 million or $2.09 per share in 2019.

Contributions to Power Corporation’s earnings per share:

2020

^[1]

2019

^{(in dollars per Power Corporation share)}

Net Earnings

Adjusted Net
Earnings

Net Earnings

Adjusted Net
Earnings

Lifeco ^[2]

2.02

1.91

1.81

1.84

IGM

0.50

0.52

0.50

0.51

Pargesa/GBL

0.10

0.11

0.17

0.19

Alternative investment platforms ^[3]

0.12

0.08

0.05

0.05

China AMC

0.04

0.04

0.05

0.05

2.78

2.66

2.58

2.64

Corporate operations and Other ^[4]

(0.63)

(0.60)

(0.47)

(0.55)

2.15

2.06

2.11

2.09

Average shares outstanding
(in millions)

637.7

441.3

Adjustments in the nine-month period of 2020, excluded from adjusted net earnings, were a net positive impact to earnings of $55 million or $0.09 per share, mainly related to the Corporation’s share of Lifeco’s adjustments and a recovery on the deconsolidation of IntegraMed America, Inc. (IntegraMed), offset by the Corporation’s share of IGM’s adjustments. Adjustments in the nine-month period of 2019 were a net positive impact to earnings of $11 million or $0.02 per share, mainly related to a favourable change to the Corporation’s income tax provision estimates of $31 million, offset by the Corporation’s share of Lifeco’s and Pargesa’s adjustments.

[1]

The Corporation completed the Reorganization on February 13, 2020 and now holds 100% of the common shares in the capital of Power Financial. In the second quarter of 2019, the Corporation completed a substantial issuer bid and repurchased 9.8% of its Subordinate Voting Shares.

[2]

Power Financial participated in Lifeco’s substantial issuer bid in the second quarter of 2019; the number of shares held by Power Financial decreased by 7.4%.

[3]

Alternative investment platforms includes earnings (losses) from investment platforms including controlled and consolidated subsidiaries and other investments.

[4]

Includes operating and other expenses, dividends on non-participating shares of the Corporation and its share of Power Financial’s corporate operations and consolidation entries; refer to the Earnings Summary below.

Great-West Lifeco, IGM Financial and Pargesa

Results for the third quarter ended September 30

The information below is derived from Lifeco and IGM’s interim MD&As, as prepared and disclosed by the respective companies in accordance with applicable securities legislation, and which are also available either directly from SEDAR (www.sedar.com) or from their websites, www.greatwestlifeco.com and www.igmfinancial.com. The information below related to Pargesa is derived from publicly disclosed information, as issued by Pargesa in its third quarter press release. Further information on Pargesa’s results is available on its website at www.pargesa.ch.

GREAT-WEST LIFECO INC.

Net earnings attributable to common shareholders were $826 million or $0.891 per share, compared with $730 million or $0.786 per share in 2019.

Adjusted net earnings ^[¹^] attributable to common shareholders were $679 million or $0.732 per share, compared with $677 million or $0.729 per share in 2019.

Adjustments in the third quarter of 2020, excluded from adjusted net earnings, were a net positive impact to earnings of $147 million, compared with a net positive impact to earnings of $53 million in 2019. Lifeco’s adjustments in 2020 consisted of a net positive impact of actuarial assumption changes and other management actions, market-related impacts on liabilities and a net gain on the sale of Irish Progressive Services International Limited, offset by transaction costs related to the acquisitions of Personal Capital and MassMutual.

[1]

Described as “base earnings” by Lifeco. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news releAse.

IGM FINANCIAL INC.

Net earnings available to common shareholders were $191 million or $0.80 per share, compared with $202 million or $0.85 per share in 2019.

Adjusted net earnings available to common shareholders were $214 million or $0.90 per share, compared with $202 million or $0.85 per share in 2019.

Adjustments in the third quarter of 2020, excluded from adjusted net earnings, were a net negative impact to earnings of $23 million consisting of restructuring and other charges, offset by a gain on the sale of IGM’s investment in Personal Capital.

Assets under management and advisement at September 30, 2020 were $196.4 billion, an increase of 4.3% from June 30, 2020.

PARGESA HOLDING SA

Pargesa reported a net loss of SF23 million, compared with net earnings of SF91 million in 2019.

Adjusted net earnings were a net loss of SF21 million, compared with adjusted net earnings of SF107 million in 2019. Adjustments, not included in adjusted net earnings, were a charge of SF2 million in the third quarter, compared with a charge of SF16 million in 2019, mainly consisting of other charges at Pargesa related to Parques Reunidos Servicios Centrales, S.A. (Parques), an equity investment.

Pargesa reported a net asset value at September 30, 2020 of SF8,375 million, representing SF98.8 per share, compared with SF8,393 million or SF99.0 per share at June 30, 2020.

Pargesa adopted IFRS 9 in 2018. Power Corporation continues to apply IAS 39; this results in a negative adjustment to the contribution from Pargesa of $28 million in the third quarter of 2020.

Parjointco N.V. (Parjointco) and Pargesa announced on March 11, 2020 a public exchange offer for all Pargesa shares not held by Parjointco to be exchanged for Groupe Bruxelles Lambert (GBL) shares. Following the successful public exchange offer, Power Financial holds an interest of 48.7% in Pargesa. Pargesa in turn holds a 29.5% in GBL. The transaction is expected to be completed in the fourth quarter of 2020.

Alternative and Other Investments
For the period ended September 30

Alternative and other investments are comprised of the results of the Corporation’s investment platforms, Sagard Holdings and Power Sustainable Capital Inc. (Power Sustainable Capital), which includes income earned from asset management activities and investing activities. Asset management activities includes management fees and carried interests, net of investment platform expenses. Investing activities comprises income earned on the capital invested by the Corporation (proprietary capital) in each platform and the share of earnings (losses) of controlled and consolidated subsidiaries held within the investment platforms. Other includes the share of earnings (losses) of standalone businesses and the Corporation’s investments in investment and hedge funds. For additional information, refer to the table later in this news release.

Third Quarter
Income from the Corporation’s alternative and other investments was $20 million, compared with a loss of $5 million in 2019.

COVID-19

The outbreak of the novel strain of coronavirus, specifically identified as “COVID-19”, has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans, self-imposed quarantine periods and social distancing, have caused material disruption to businesses globally resulting in an economic slowdown. Governments and central banks have responded with significant monetary and fiscal interventions designed to stabilize economic conditions. Equity markets in particular have been volatile, experiencing material and rapid declines in the first quarter of 2020. However, following March 31, 2020, the markets have experienced recoveries.

The Corporation is managing the risks associated with the COVID-19 pandemic utilizing its existing risk management framework. At Power Corporation and its group companies, the focus has continued to be on managing the safety and well-being of its people, maintaining operational effectiveness, ensuring that the group can serve its customers, assessing impacts on earnings, liquidity and capital, planning for different potential scenarios and engaging with stakeholders. The respective boards of directors of Power Financial, Lifeco, IGM, Pargesa and GBL are responsible for the governance structures and processes to oversee the management of the risk and potential impacts presented by the current economic slowdown and other potential consequences due to COVID-19.

The duration and impact of the COVID-19 pandemic is unknown at this time. Economic damage and market weakness are being felt across the global economy. Significant economic headwinds are expected to continue into the fourth quarter of 2020 and beyond as a result of anticipated negative credit experiences, impairment of valuations in certain sectors of the economy and asset classes, and uncertainties in the durability and effectiveness of government and central bank interventions, among others. It is not possible to reliably estimate the length and severity of these developments and the impact on the financial results and condition of the Corporation and its operating subsidiaries in future periods.

Dividend on Power Corporation Participating Shares

The Board of Directors declared a quarterly dividend of 44.75 cents per share on the Participating Preferred Shares and the Subordinate Voting Shares of the Corporation, payable February 1, 2021 to shareholders of record December 31, 2020.

Dividends on Power Corporation Non-Participating Preferred Shares

The Board of Directors also declared quarterly dividends on the Corporation’s preferred shares, payable January 15, 2021 to shareholders of record December 24, 2020:

Series

Stock Symbol

Amount

Series

Stock Symbol

Amount

1986 Series

POW.PR.F

Floating rate ^[1]

Series C

POW.PR.C

36.25¢

Series A

POW.PR.A

35¢

Series D

POW.PR.D

31.25¢

Series B

POW.PR.B

33.4375¢

Series G

POW.PR.G

35¢

[1]

Equal to one quarter of 70% of the average prime rate of two major Canadian chartered banks for the period September 1 to November 30, 2020.

About Power Corporation

Power Corporation is an international management and holding company that focuses on financial services in North America, Europe and Asia. Its core holdings are leading insurance, retirement, wealth management and investment businesses, including a portfolio of alternative asset investment platforms. To learn more, visit www.PowerCorporation.com.

At September 30, 2020, Power Corporation held the following economic interests:

100% – Power Financial www.powerfinancial.com

66.9% – Great-West Lifeco (TSX: GWO) www.greatwestlifeco.com

62.1% – IGM Financial (TSX: IGM) www.igmfinancial.com

48.7% – Pargesa (SIX: PARG) www.pargesa.ch

83.4% – Wealthsimple ^[1]www.wealthsimple.com

Investment Platforms

100% – Sagard Holdings ^[2]www.sagardholdings.com

100% – Power Sustainable Capital www.powersustainable.com

Power Pacific Investment Management www.powerpacificim.com

Power Energy Corporation www.powerenergycorporation.com

27.8% – China AMC ^[3]www.chinaamc.com

[1]

Undiluted equity interest held by Lifeco, IGM and Power Financial (the Group), representing a fully diluted equity interest of 70.1%. On October 14, 2020, Wealthsimple announced the closing of a $114 million investment on a pre-money valuation of $1.4 billion. The investment was led by TCV, one of the largest growth equity investors focused on technology, along with Greylock Partners, Meritech Capital, Allianz X and Two Sigma Ventures. With the closing of the investment, the Group now has an ownership interest in Wealthsimple of 61.7% on a fully diluted basis.

[2]

Includes the Corporation’s interest in European private equity funds (formerly Sagard Europe). Refer to the Corporation’s most recent MD&A for interest in the funds managed by Sagard Holdings.

[3]

IGM and the Corporation each hold a 13.9% interest in China AMC.

Earnings Summary

Earnings

(unaudited)

Three months ended

Nine months ended

(in millions of Canadian dollars)

September 30,

September 30,

2020

2019

2020

2019

Adjusted net earnings ^[1]

Power Financial

Lifeco ^[2]

454

452

1,289

1,258

IGM ^[2]

133

126

347

348

Pargesa ^[2]

(15)

40

73

130

Corporate operations of Power Financial

Income (loss) from investments ^[3]

(34)

2

(38)

(2)

Operating and other expenses

(15)

(24)

(64)

(74)

Dividends on perpetual preferred shares

(34)

(35)

(103)

(104)

Consolidation entries ^[4]

(54)

(8)

(33)

36

435

553

1,471

1,592

Attributable to non-controlling interests of Power Financial

−

200

116

566

Corporation’s share of Power Financial

435

353

1,355

1,026

Alternative and other investments ^[5]

20

(5)

50

19

China AMC

11

8

30

23

Corporate operations

(15)

(35)

(80)

(111)

Dividends on non-participating shares

(13)

(13)

(39)

(39)

Adjusted net earnings ^[6]

438

308

1,316

918

Adjustments – see below

67

51

55

11

Net earnings ^[6]

505

359

1,371

929

[1]

Effective the first quarter of 2020, the Corporation introduced a modified definition of its Non-IFRS earnings measures, Adjusted net earnings. The comparative figures have been restated. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release.

[2]

As reported by Lifeco, IGM and Pargesa.

[3]

The third quarter of 2020 includes Power Financial’s share in the amount of $33 million related to the impact of the remeasurement of the put right liability of the non-controlling interests in Wealthsimple to fair value and an increase in carried interests payable.

[4]

The consolidation entries include an allocation of the results of Wealthsimple, KOHO Financial Inc. (Koho), Portag3 Ventures Limited Partnership (Portag3 I), Portag3 Ventures II Limited Partnership (Portag3 II), to the contributions from Lifeco and IGM based on their respective interest. The third quarter of 2020 includes a charge of $36 million related to the allocation of the remeasurement of the put right liability of the non-controlling interests in Wealthsimple to fair value and carried interests payable. This charge was offset by IGM’s gain on Personal Capital which the Corporation has not included as an Adjustment. The consolidation entries also reflect adjustments in accordance with IAS 39 for IGM and Pargesa.

[5]

Includes earnings of the Corporation’s investment platforms and earnings (losses) from Power Energy Corporation and standalone businesses, which include IntegraMed (up to the date of deconsolidation on May 20, 2020).

[6]

Attributable to participating shareholders.

Earnings per Share

(unaudited)

Three months ended

Nine months ended

(in dollars per share)

September 30,

September 30,

2020

2019

2020

2019

Adjusted net earnings per share
–
basic

^[1]

Power Financial

Lifeco ^[2]

0.67

0.67

1.91

1.84

IGM ^[2]

0.20

0.19

0.52

0.51

Pargesa ^[2]

(0.02)

0.06

0.11

0.19

Corporate operations of Power Financial ^[3]

(0.12)

(0.08)

(0.31)

(0.26)

Consolidation entries^[4]

(0.09)

(0.02)

(0.10)

0.05

0.64

0.82

2.13

2.33

Alternative and other investments ^[5]

0.03

(0.01)

0.08

0.05

China AMC

0.02

0.02

0.04

0.05

Corporate operations and dividends

(0.04)

(0.11)

(0.19)

(0.34)

on non-participating shares

Adjusted net earnings per share ^[6]

0.65

0.72

2.06

2.09

Adjustments – see below

0.10

0.12

0.09

0.02

Net earnings per share ^[6]

0.75

0.84

2.15

2.11

[1]

Effective the first quarter of 2020, the Corporation introduced a modified definition of its Non-IFRS earnings measures, Adjusted net earnings. The comparative figures have been restated. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release.

[2]

As reported by Lifeco, IGM and Pargesa.

[3]

The third quarter of 2020 includes Power Financial’s share in the amount of $33 million or $0.05 per share related to the impact of the remeasurement of the put right liability of the non-controlling interests in Wealthsimple to fair value and an increase in carried interests payable.

[4]

The consolidation entries include an allocation of the results of Wealthsimple, Koho, Portag3 I and Portag3 II, to the contributions from Lifeco and IGM based on their respective interest. The third quarter of 2020 includes a charge of $36 million or $0.05 per share related to the allocation of the remeasurement of the put right liability of the non-controlling interests in Wealthsimple to fair value and carried interests payable. This charge was offset by IGM’s gain on Personal Capital which the Corporation has not included as an Adjustment. The consolidation entries also reflect adjustments in accordance with IAS 39 for IGM and Pargesa.

[5]

Includes earnings of the Corporation’s investment platforms and earnings (losses) from Power Energy Corporation and standalone businesses, which include IntegraMed (up to the date of deconsolidation on May 20, 2020).

[6]

Attributable to participating shareholders.

Alternative and Other Investments

(unaudited)

Three months ended

Nine months ended

(in millions of Canadian dollars)

September 30,

September 30,

2020

2019

2020

2019

Sagard Holdings

Asset management activities ^[1]

4

(4)

−

(24)

Investing activities (proprietary capital)

−

−

32

8

Power Sustainable Capital

Investing activities (proprietary capital)

(5)

14

38

66

Other

Standalone businesses ^[2]

23

(18)

(16)

(52)

Investment and hedge funds and other ^[3]

(2)

3

(4)

21

20

(5)

50

19

[1]

Includes management fees charged by the investment platform on proprietary capital. Management fees paid by the Corporation are deducted from income from investment activities.

[2]

Includes the Corporation’s share of earnings (losses) of IntegraMed (up to the date of deconsolidation on May 20, 2020), Lumenpulse Group Inc., The Lion Electric Co., and a jointly controlled corporation and associates.

[3]

Other consists mainly of foreign exchange gains or losses and interest on cash and cash equivalents.

Adjustments (not included in adjusted net earnings)

(unaudited)

Three months ended

Nine months ended

(in millions of Canadian dollars)

September 30,

September 30,

2020

2019

2020

2019

Share of Lifeco’s adjustments:

Actuarial assumption changes

44

54

91

167

and other management actions

Market-related impacts on liabilities

13

(19)

(64)

(51)

Net gain on sale of Irish Progressive Services International Limited

63

−

63

−

Transaction costs related to the acquisitions

(21)

−

(21)

−

of Personal Capital and MassMutual

Net charge on the sale, via reinsurance, of U.S. individual life

insurance and annuity business

−

−

−

(134)

99

35

69

(18)

Share of IGM’s adjustments ^[1]:

Restructuring and other charges

(34)

−

(34)

−

Share of Lifeco’s adjustments

4

1

3

(1)

(30)

1

(31)

(1)

Share of Pargesa’s adjustments:

Imerys – Impairments, restructuring charges and other

(1)

−

(3)

(7)

Parques and other charges

(1)

(6)

(3)

(6)

(2)

(6)

(6)

(13)

67

30

32

(32)

Attributable to non-controlling interests of Power Financial

−

10

4

(12)

Corporation’s share of Power Financial

67

20

28

(20)

Other investments

Recovery on deconsolidation of IntegraMed

−

−

27

−

Corporate operations

Reduction of income tax estimates ^[2]

−

31

−

31

67

51

55

11

[1]

Includes IGM’s share of Lifeco’s Adjustments for the impact of actuarial assumption changes and management actions and market impact on insurance contract liabilities, in accordance with the Corporation’s definition of Adjusted net earnings. Excludes the Corporation’s share of IGM’s Adjustment related to the gain on disposal of Personal Capital; the Corporation has not included this amount as an Adjustment as the gain recognized by the Corporation relates to the remeasurement of the investment in Personal Capital at fair value on the date Lifeco acquired control. For additional information, please refer to the Non-IFRS Financial Measures and Presentation section later in this news release.

[2]

Related to a favourable change in income tax provision estimates recorded in the third quarter of 2019.

Contribution to Power Corporation’s Adjusted Net Earnings

In millions

Per share

Three months ended September 30, 2020

(unaudited)

(in Canadian dollars)

Contribution

to adjusted net earnings

as reported

Consolidation entries ^[1]

Contribution to
Power
Corporation’s

adjusted net earnings

Contribution

to adjusted net earnings

as reported

Consolidation entries ^[1]

Contribution to Power Corporation’s

adjusted net earnings

Lifeco

454

(7)

447

0.67

(0.01)

0.66

IGM ^[2]

133

(19)

114

0.20

(0.03)

0.17

Pargesa

(15)

(28)

(43)

(0.02)

(0.05)

(0.07)

Nine months ended September 30, 2020

(unaudited)

(in Canadian dollars)

Contribution

to adjusted net earnings

as reported

Consolidation entries ^[1]

Contribution to Power Corporation’s

adjusted net earnings

Contribution

to adjusted net earnings

as reported

Consolidation entries ^[1]

Contribution to Power Corporation’s

adjusted net earnings

Lifeco

1,216

(9)

1,207

1.91

(0.01)

1.90

IGM ^[2]

330

(28)

302

0.52

(0.05)

0.47

Pargesa

73

(28)

45

0.11

(0.04)

0.07

[1]

The contributions from Lifeco and IGM include an allocation of the results of Portag3 I, Portag3 II, Wealthsimple and Koho, based on their respective interest. The contributions from IGM and Pargesa reflect adjustments in accordance with IAS 39.

[2]

In the third quarter of 2020, the adjustment of IGM mainly relates to the allocation of the remeasurement of the put right liability of the non-controlling interests in Wealthsimple to fair value and carried interests payable. This charge was offset by IGM’s gain on Personal Capital which the Corporation has not included as an Adjustment; the Corporation has not included this amount as an Adjustment as the gain recognized by the Corporation relates to the remeasurement of the investment in Personal Capital at fair value on the date Lifeco acquired control.

Adjustments to Pargesa’s Contribution

Power Corporation has deferred the adoption of IFRS 9 and continues to apply IAS 39. The following table presents adjustments to the contribution of Pargesa to Power Corporation’s earnings in accordance with IAS 39:

(unaudited)

2020

(in millions of Canadian dollars)

Q3

Q2

Q1

Total

Disposal of interest in Total SA ^[1]

−

−

45

45

Impairment charges ^[1]

(7)

(5)

(40)

(52)

Disposal of private equity funds and other

(2)

(4)

17

11

Reversal of unrealized (gains) losses on private equity funds and other ^[2]

(19)

(33)

20

(32)

Total

(28)

(42)

42

(28)

[1]

On January 1, 2018, Pargesa adopted IFRS 9 which resulted in the reclassification of the majority of its investments (excluding private equity funds) from available for sale (AFS) to fair value through other comprehensive income (FVOCI). All changes in fair value of equity investments designated as FVOCI are recognized permanently in other comprehensive income. Power Corporation continues to apply IAS 39 and has adjusted its share of these items.

[2]

Pargesa classifies private equity investments at fair value through profit and loss in accordance with IFRS 9 and recognizes unrealized changes in fair value in earnings. Power Corporation does not recognize these unrealized fair value changes in earnings as it continues to classify these private equity funds as available for sale in accordance with IAS 39.

Net Asset Value

Net asset value represents management’s estimate of the fair value of the participating shareholders’ equity of the Corporation. Net asset value is the fair value of the assets of the combined Power Financial and Power Corporation’s non-consolidated balance sheet less their net debt and preferred shares. The Corporation’s net asset value per share is presented on a look-through basis.

The Corporation’s net asset value per share was $34.94 at September 30, 2020, compared with $32.96 at June 30, 2020, representing an increase of 6.0%.

September 30, 2020

(in millions of Canadian dollars,

except per share amounts)

Combined
non-consolidated
balance sheet

Fair value
adjustment

Net asset value

Assets

Investments

Power Financial

Lifeco

14,291

1,848

16,139

IGM

2,785

1,731

4,516

Pargesa/GBL^[1]

3,860

(1,182)

2,678

Other Power Financial investments

152

362

514

Alternative and other investments

Sagard Holdings

Asset management companies^[2]

177

−

177

Investments ^[3]

709

−

709

Power Sustainable Capital

Power Pacific

977

−

977

Power Energy Corporation

418

317

735

Other

Standalone businesses

536

89

625

Other

150

15

165

China AMC ^[4]

709

−

709

Cash and cash equivalents

1,216

−

1,216

Other assets

351

−

351

Total assets

26,331

3,180

29,511

Liabilities and

non-participating shares

Debentures and other debt instruments

1,044

−

1,044

Other liabilities ^[5]

1,053

−

1,053

Non-participating shares and

3,787

−

3,787

perpetual preferred shares

Total liabilities and non-participating shares

5,884

−

5,884

Net value

Participating shareholders’

20,447

3,180

23,627

equity / Net asset value

Per share

30.24

34.94

[1]

As part of the Pargesa reorganization, Parjointco holds approximately 97% of Pargesa’s shares at September 30, 2020; the fair value of Parjointco at September 30, 2020 is based on the market value of GBL.

[2]

The management companies of the investment funds are presented at their carrying value in accordance with IFRS.

[3]

Includes investments in European private equity, formerly Sagard Europe.

[4]

Valued at carrying value in accordance with IFRS.

[5]

In accordance with IAS 12, Income taxes, no deferred tax liability is recognized with respect to temporary differences associated with investments in subsidiaries and jointly controlled corporations as the Corporation is able to control the timing of the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future. If the Corporation were to dispose of an investment in a subsidiary or a jointly controlled corporation, income taxes payable on such disposition would be minimized through careful and prudent tax planning and structuring, as well as with the use of available tax attributes not otherwise recognized on the balance sheet, including tax losses, tax basis, safe income and foreign tax surplus associated with the subsidiary or jointly controlled corporation.

Non-IFRS Financial Measures and Presentation

In the second quarter of 2020, the Corporation modified the presentation of the asset management companies held by the investment platforms. Previously, the asset management activities were consolidated and included as corporate activities within the non-consolidated balance sheet of the Corporation. Pursuant to the Corporation’s recently announced strategy, the activities of each asset management company are now presented within their operations. The comparatives in the non-consolidated balance sheets and non-consolidated statement of cash flows have been restated to reflect this change.

Effective the first quarter of 2020, the Corporation introduced a modified definition of its non-IFRS earnings measure, Adjusted net earnings. This change is consistent with the introduction of base earnings (loss) by Lifeco which was introduced in the first quarter of 2020 to reflect management’s view of the operating performance of Lifeco. Lifeco defines base earnings (loss) as net earnings excluding the impact of actuarial assumption changes and management actions, direct equity and interest rate market impacts on insurance contract liabilities net of hedging, and items that management believes are not indicative of the company’s underlying business results. The definition of Adjustments includes what the Corporation previously presented as other items and also includes Lifeco’s impact of actuarial assumption changes and management actions, and direct equity and interest rate market impacts on insurance contract liabilities net of hedging. The definition of Adjustments used in Adjusted net earnings is being adopted to enhance comparability of results between reporting periods and in anticipation of Lifeco’s implementation of accounting changes related to IFRS 17, Insurance Contracts, on January 1, 2023. The comparative periods have been restated to reflect the introduction of this modified measure.

Net earnings attributable to participating shareholders are comprised of:

Adjusted net earnings attributable to participating shareholders; and

Adjustments, which include the after-tax impact of any item that in management’s judgment would make the period-over-period comparison of results from operations less meaningful. Adjustments include the Corporation’s share of Lifeco’s impact of actuarial assumption changes and management actions, direct equity and interest rate market impacts on insurance contract liabilities net of hedging, as well as items that management believes are not indicative of the underlying business results which include those identified by a subsidiary or a jointly controlled corporation.

Management uses these financial measures in its presentation and analysis of the financial performance of Power Corporation and believes that they provide additional meaningful information to readers in their analysis of the results of the Corporation. Adjusted net earnings, as defined by the Corporation, assist the reader in comparing the current period’s results to those of previous periods as it reflects management’s view of the operating performance of the Corporation and its subsidiaries and excludes items that are not considered to be part of the underlying business results from this non-IFRS financial measure.

Adjusted net earnings attributable to participating shareholders and adjusted net earnings per share are non-IFRS financial measures that do not have a standard meaning and may not be comparable to similar measures used by other entities.

The Corporation also uses a non-consolidated basis of presentation to present and analyze its results whereby the Corporation’s interests in Power Financial and other subsidiaries are accounted for using the equity method. Presentation on a non-consolidated basis is a non-IFRS presentation. However, it is useful to the reader as it presents the holding company’s (parent) results separately from the results of its operating subsidiaries.

Net asset value is commonly used by holding companies to determine their value. Net asset value is the fair value of Power Corporation’s non-consolidated assets less its net debt and preferred shares. The investments held in public entities (including Lifeco, IGM and GBL (through Parjointco)) are measured at their market value and investments in private entities and investment funds are measured at management’s estimate of fair value. Pargesa’s net asset value is determined on the basis of current market values for listed shareholdings, plus the fair value of private equity activities and GBL treasury shares, less net debt. This measure presents the fair value of the net assets of the holding company to management and investors and assists the reader in determining the value of the holding company.

This news release may also contain other non-IFRS financial measures which are publicly disclosed by the Corporation’s subsidiaries such as sales, assets under management and assets under administration. Refer to the “Non-IFRS Financial Measures and Presentation” section of the Corporation’s most recent Management’s Discussion and Analysis for the definition of non-IFRS financial measures and their reconciliation with IFRS financial measures.

Eligible Dividends

For purposes of the Income Tax Act (Canada) and any similar provincial legislation, all of the above dividends on the Corporation’s preferred shares (including the Participating Preferred Shares) and Subordinate Voting Shares are eligible dividends.

Forward-Looking Statements

Certain statements in this news release, other than statements of historical fact, are forward-looking statements based on certain assumptions and reflect the Corporation’s current expectations, or with respect to disclosure regarding the Corporation’s public subsidiaries, reflect such subsidiaries’ disclosed current expectations. Forward-looking statements are provided for the purposes of assisting the reader in understanding the Corporation’s financial performance, financial position and cash flows as at and for the periods ended on certain dates and to present information about management’s current expectations and plans relating to the future and the reader is cautioned that such statements may not be appropriate for other purposes. These statements may include, without limitation, statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Corporation and its subsidiaries, including the fintech strategy, the expected impact of the COVID-19 pandemic on the Corporation and its subsidiaries’ operations, results and dividends, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, the intended effects of the Reorganization (as defined herein), and the proposed redemption by the Corporation and Power Financial of certain classes of their First Preferred Shares. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as “expects”, “anticipates”, “plans”, “believes”, “estimates”, “seeks”, “intends”, “targets”, “projects”, “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may”, “will”, “should”, “would” and “could”.

By its nature, this information is subject to inherent risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities will not be achieved. A variety of factors, many of which are beyond the Corporation’s and its subsidiaries’ control, affect the operations, performance and results of the Corporation and its subsidiaries and their businesses, and could cause actual results to differ materially from current expectations of estimated or anticipated events or results. These factors include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in North America and internationally, fluctuations in interest rates, inflation and foreign exchange rates, monetary policies, business investment and the health of local and global equity and capital markets, management of market liquidity and funding risks, risks related to investments in private companies and illiquid securities, risks associated with financial instruments, changes in accounting policies and methods used to report financial condition (including uncertainties associated with significant judgments, estimates and assumptions), the effect of applying future accounting changes, business competition, operational and reputational risks, technological changes, cybersecurity risks, changes in government regulation and legislation, changes in tax laws, unexpected judicial or regulatory proceedings, catastrophic events, man-made disasters, terrorist attacks, wars and other conflicts, or an outbreak of a public health pandemic or other public health crises (such as COVID-19), the Corporation’s and its subsidiaries’ ability to complete strategic transactions, integrate acquisitions and implement other growth strategies, and the Corporation’s and its subsidiaries’ success in anticipating and managing the foregoing factors.

The reader is cautioned to consider these and other factors, uncertainties and potential events carefully and not to put undue reliance on forward-looking statements. Information contained in forward-looking statements is based upon certain material assumptions that were applied in drawing a conclusion or making a forecast or projection, including management’s perceptions of historical trends, current conditions and expected future developments, as well as other considerations that are believed to be appropriate in the circumstances, including the availability of cash to redeem First Preferred Shares of the Corporation and Power Financial and that the list of factors in the previous paragraph, collectively, are not expected to have a material impact on the Corporation and its subsidiaries. While the Corporation considers these assumptions to be reasonable based on information currently available to management, they may prove to be incorrect.

Other than as specifically required by applicable Canadian law, the Corporation undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made, or to reflect the occurrence of unanticipated events, whether as a result of new information, future events or results, or otherwise.

Additional information about the risks and uncertainties of the Corporation’s business and material factors or assumptions on which information contained in forward-looking statements is based is provided in its disclosure materials, including its most recent Management’s Discussion and Analysis and Annual Information Form, filed with the securities regulatory authorities in Canada and available at www.sedar.com.

SOURCE Power Corporation of Canada

Posted on November 11, 2020 5:48 pm
Five Prime Presents First Preclinical Data on Anti-CCR8 Antibody FPA157

Five Prime Presents First Preclinical Data on Anti-CCR8 Antibody FPA157

Preclinical data support evaluation of FPA157 as a novel immunomodulator with the potential to remove Treg-mediated immune suppression in solid tumors

FPA157 is an anti-CCR8 antibody engineered to enhance antibody-dependent cell-mediated cytotoxicity to preferentially eliminate CCR8+ Treg cells in the tumor microenvironment

Data presented today at The Society for Immunotherapy of Cancer (SITC) 35th Anniversary Annual Meeting & Pre-Conference Programs (SITC 2020) show investigational immunotherapy FPA157 elicits anti-tumor activity in multiple preclinical models

FPT157 is undergoing IND-enabling studies

SOUTH SAN FRANCISCO, Calif.–(BUSINESS WIRE)–Five Prime Therapeutics, Inc. (NASDAQ: FPRX) today presented the first preclinical data from its anti-CCR8 FPA157 program at The Society for Immunotherapy of Cancer (SITC) 35th Anniversary Annual Meeting & Pre-Conference Programs (SITC 2020).

The poster, “Development of FPA157, an anti-CCR8 depleting antibody engineered to preferentially eliminate tumor-infiltrating T regulatory cells,” was presented in a late-breaker live Q&A session and is available here.

Key highlights from the poster included:

CCR8 expression is highly restricted to T regulatory (Treg) cells within the tumor

Preclinical efficacy studies demonstrate that anti-CCR8 antibody treatment depletes CCR8+ Tregs in the tumor microenvironment while sparing peripheral Treg subsets

Anti-CCR8 treatment elicits the development of robust anti-tumor memory responses

FPA157 leads to potent natural killer (NK) cell-dependent killing of CCR8+ target cells

“Preclinical data for FPA157 suggest that selective depletion of regulatory T cells within the tumor— without affecting peripheral Tregs—is a promising and exciting therapeutic pathway to pursue,” said Andrew Rankin, PhD, Vice President of Research. “This is the first time we are publicly sharing information about the CCR8 inhibitor antibody in the Five Prime immuno-oncology pipeline and to do so at SITC is very rewarding. We are eager to further investigate the potential of FPA157 in the clinic.”

There will be two live Q&A sessions with poster author Edwina Naik, PhD, Associate Director, Immuno-Oncology Research. The first is today, November 11, 2020 from 5:15-5:45pm EST and the second is on November 13, 2020 from 4:40-5:10pm EST.

About FPA157

FPA157 is a monoclonal antibody targeting CCR8 that is designed to enhance antibody-dependent cell-mediated cytotoxicity (ADCC) and deplete the T regulatory cell (Treg) population in the tumor microenvironment. Tregs inhibit anti-tumoral immune responses and act through multiple suppressive mechanisms.^1,2 FPA157 is part of the Five Prime immuno-oncology antibody pipeline and is undergoing IND-enabling studies.

About Five Prime Therapeutics

Five Prime Therapeutics, Inc. discovers and develops innovative protein therapeutics to improve the lives of patients with serious diseases. Five Prime’s product candidates have innovative mechanisms of action and address patient populations in need of better therapies. The company focuses on researching and developing immuno-oncology and targeted cancer therapies paired with companion diagnostics to identify patients who are most likely to benefit from treatment with Five Prime’s product candidates. Five Prime has entered into strategic collaborations with leading global pharmaceutical companies and has promising product candidates in clinical and preclinical development. For more information, please visit www.fiveprime.com.

Cautionary Note on Forward-looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “may,” “will,” “expect,” “plan,” “anticipate,” “estimate,” “intend” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. These forward-looking statements are based on Five Prime’s expectations and assumptions as of the date of this press release. Each of these forward-looking statements involves risks and uncertainties. Forward-looking statements contained in this press release include statements regarding (i) Five Prime’s expectations regarding the potential safety, efficacy or clinical utility of FPA157; and (ii) the potential use of FPA157 to treat certain patients. Actual results may differ materially from these forward-looking statements. Many factors may cause differences between current expectations and actual results, including unexpected safety or efficacy data observed during research, preclinical or clinical studies, changes in expected or existing competition, changes in the regulatory, pricing or reimbursement environment, and unexpected litigation or other disputes. In addition, while the company expects the COVID-19 pandemic to adversely affect its business operations and financial results, the extent of the impact on the company’s ability to advance its manufacturing, clinical development and regulatory efforts and business and corporate development and other objectives and the value of and market for its common stock will depend on future developments that are highly uncertain, and the company cannot predict with confidence the ultimate duration of the pandemic, travel restrictions, quarantines, social distancing and business closure requirements in the U.S. and in other countries and the effectiveness of actions taken globally to contain and treat COVID-19. Other factors that may cause actual results to differ from those expressed or implied in the forward-looking statements in this press release are discussed in Five Prime’s filings with the U.S. Securities and Exchange Commission, including the “Risk Factors” contained therein. Except as required by law, Five Prime assumes no obligation to update any forward-looking statements contained herein to reflect any change in expectations, even as new information becomes available.

References

Teng MW, Ngiow SF, von Scheidt B, McLaughlin N, Sparwasser T, Smyth MJ. Conditional regulatory T-cell depletion releases adaptive immunity preventing carcinogenesis and suppressing established tumor growth [published correction appears in Cancer Res. 2010; 70(23):10014]. Cancer Res. 2010; 70(20):7800-7809. doi:10.1158/0008-5472.CAN-10-1681

Simpson TR, Li F, Montalvo-Ortiz W, et al. Fc-dependent depletion of tumor-infiltrating regulatory T cells co-defines the efficacy of anti-CTLA-4 therapy against melanoma. J Exp Med. 2013; 210(9):1695-710. doi:10.1084/jem.20130579

Source: Five Prime Therapeutics, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20201111005832/en/

Media and Investor Contact

Martin Forrest

VP, Investor Relations & Corporate Communications

Five Prime Therapeutics, Inc.

415-365-5625

[email protected]

KEYWORDS: United States North America California

INDUSTRY KEYWORDS: Oncology Health Stem Cells Clinical Trials Pharmaceutical Biotechnology

MEDIA:

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Posted on November 11, 2020 5:39 pm
VISLINK TECHNOLOGIES, INC. Third Quarter 2020 Earnings Update

HACKETTSTOWN, NJ, Nov. 11, 2020 (GLOBE NEWSWIRE) — Vislink Technologies, Inc. (NASDAQ: VISL) (the “Company”) plans to release the results of its third quarter (ended September 30, 2020) on Thursday, November 12, 2020. On Friday November 13, 2020, Vislink’s CEO, Carleton Miller, and CFO, Michael Bond, will host a webcast at approximately 10:00 a.m. ET to give the Q3 earnings update. This webcast will be live at https://services.choruscall.com/links/visl201113.html. Investors will be able to submit questions during the webcast.

About Vislink Technologies, Inc.

Vislink Technologies is a global leader in the development and distribution of advanced communication solutions. Driven by technical excellence that has led the industry for over 50 years, our innovative products and turnkey solutions provide reliable connectivity in the toughest environments across the global live production, military and government sectors. Our solutions include high-definition communication links that reliably capture, transmit and manage live event footage, as well as secure video systems that support mission-critical applications. Vislink Technologies shares are publicly traded on the Nasdaq Capital Market under the ticker symbol VISL. For more information, visit www.vislink.com.

Note on Forward-looking Statements

This press release may contain projections or other forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These statements involve risks and uncertainties, and actual events or results may differ materially. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are the risk that our reduction in operating expenses may impact our ability to meet our business objectives and achieve our revenue targets and may not result in the expected improvement in our profitability, the fact that our future growth depends in part on further penetrating our addressable market and also growing internationally, and we may not be successful in doing so; our dependence on sales of certain products to generate a significant portion of our revenue; the effect of a decrease in the sales or change in sales mix of these products would harm our business; the risks that an economic downturn or economic uncertainty in our key U.S. and international markets may adversely affect demand for our products; difficulty in accurately predicting our future customer demand; the importance of maintaining the value and reputation of our brand; and other factors detailed in our Annual Report on Form 10-K for the year ended December 31, 2019 and our other subsequent filings with the Securities and Exchange Commission. These forward-looking statements speak only as of the date hereof or as of the date otherwise stated herein. The Company disclaims any obligation to update these forward-looking statements.

FOR MORE INFORMATION:

[email protected]

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