LIQUIDITY AND CAPITAL RESOURCES
Summary of consolidated financial position
| | | | | | | | | | | | | | | | | | | | |
(dollars in thousands) | | March 31, 2023 | | December 31, 2022 | | Change |
Cash | | $ | 15,659 | | | $ | 69,144 | | | $ | (53,485) | |
Working capital assets | | | | | | |
Accounts receivable | | $ | 92,305 | | | $ | 83,811 | | | $ | 8,494 | |
Contract assets | | 9,739 | | | 15,802 | | | (6,063) | |
Inventories | | 53,264 | | | 49,898 | | | 3,366 | |
Prepaid expenses and deposits | | 9,535 | | | 10,587 | | | (1,052) | |
Working capital liabilities | | | | | | |
Accounts payable | | (81,377) | | | (102,549) | | | 21,172 | |
Accrued liabilities | | (30,954) | | | (43,784) | | | 12,830 | |
Contract liabilities | | (4) | | | (1,411) | | | 1,407 | |
Total net working capital (excluding cash)(i) | | $ | 52,508 | | | $ | 12,354 | | | $ | 40,154 | |
| | | | | | |
Property, plant and equipment | | $ | 663,476 | | | $ | 645,810 | | | $ | 17,666 | |
Total assets | | 950,015 | | | 979,513 | | | (29,498) | |
| | | | | | |
Credit Facility(ii) | | $ | 150,000 | | | $ | 180,000 | | | $ | (30,000) | |
Equipment financing(ii)(iii) | | 90,916 | | | 85,931 | | | 4,985 | |
Senior debt(i) | | 240,916 | | | 265,931 | | | (25,015) | |
Convertible debentures(ii) | | 129,750 | | | 129,750 | | | — | |
Mortgage(ii) | 0 | 29,033 | | | 29,231 | | | (198) | |
Total debt(i) | | 399,699 | | | 424,912 | | | (25,213) | |
Cash | | (15,659) | | | (69,144) | | | 53,485 | |
Net debt(i) | | 384,040 | | | 355,768 | | | 28,272 | |
Total shareholders' equity | | 326,219 | | | 305,919 | | | 20,300 | |
Invested capital(i) | | $ | 710,259 | | | $ | 661,687 | | | $ | 48,572 | |
(i)See "Non-GAAP Financial Measures".
(ii)Includes current portion.
(iii)The prior year amounts are adjusted to reflect a change in presentation. See "Accounting Estimates, Pronouncements and Measures".
As at March 31, 2023, we had $15.7 million in cash and $118.0 million unused borrowing availability on the Credit Facility for a total liquidity of $133.7 million (defined as cash plus available and unused Credit Facility borrowings).
Our liquidity is complemented by available borrowings through our equipment leasing partners. As at March 31, 2023, our total available capital liquidity was $172.2 million (defined as total liquidity plus unused finance lease and other borrowing availability under our Credit Facility). Borrowing availability under finance lease obligations considers the current and long-term portion of finance lease obligations and financing obligations, including specific finance lease obligations for the joint ventures that we guarantee.
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(dollars in thousands) | | March 31, 2023 | | December 31, 2022 |
Credit Facility limit | | $ | 300,000 | | | $ | 300,000 | |
Finance lease borrowing limit | | 175,000 | | | 175,000 | |
Other debt borrowing limit | | 20,000 | | | 20,000 | |
Total borrowing limit | | $ | 495,000 | | | $ | 495,000 | |
Senior debt(i) | | (240,916) | | | (265,931) | |
Letters of credit | | (32,017) | | | (32,030) | |
Joint venture guarantee | | (65,558) | | | (53,744) | |
Cash | | 15,659 | | | 69,144 | |
Total capital liquidity(i) | | $ | 172,168 | | | $ | 212,439 | |
(i)See "Non-GAAP Financial Measures".
As at March 31, 2023, we had $4.8 million in trade receivables that were more than 30 days past due compared to $1.4 million as at December 31, 2022. As at March 31, 2023, and December 31, 2022, we did not have an allowance for credit losses related to our trade receivables as we believe that there is minimal risk in the collection of our trade receivables. We continue to monitor the credit worthiness of our customers. As at March 31, 2023, holdbacks totaled $0.5 million, up from $0.4 million as at December 31, 2022.
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Management's Discussion and Analysis March 31, 2023 | M-9 | North American Construction Group Ltd. |
Capital additions
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Reconciliation to Statements of Cash Flows | | Three months ended, |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Purchase of PPE | | $ | 36,496 | | | $ | 25,265 | |
Additions to intangibles | | 2 | | | 1,573 | |
Gross capital expenditures | | $ | 36,498 | | | $ | 26,838 | |
Proceeds from sale of PPE | | (1,198) | | | (518) | |
Change in capital inventory and capital work in progress(i) | | (5,129) | | | (776) | |
Capital expenditures, net(i) | | $ | 30,171 | | | $ | 25,544 | |
Finance lease additions | | 17,020 | | | 8,695 | |
Capital additions(i) | | $ | 47,191 | | | $ | 34,239 | |
(i)See "Non-GAAP Financial Measures".
| | | | | | | | | | | | | | |
Sustaining and growth additions | | Three months ended, |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Sustaining | | $ | 30,171 | | | $ | 25,544 | |
Growth | | — | | | — | |
Capital expenditures, net(i) | | $ | 30,171 | | | $ | 25,544 | |
Sustaining | | $ | 17,020 | | | $ | 8,695 | |
Growth | | — | | | — | |
Finance lease additions | | $ | 17,020 | | | $ | 8,695 | |
Sustaining | | $ | 47,191 | | | $ | 34,239 | |
Growth | | — | | | — | |
Capital additions(i) | | $ | 47,191 | | | $ | 34,239 | |
(i)See "Non-GAAP Financial Measures".
Capital additions for the three months ended March 31, 2023, were $47.2 million ($34.2 million in Q1 2022). The current quarter spend was fully comprised of sustaining capital additions, consistent with Q1 2022. The majority of sustaining capital additions were incurred on routine maintenance of the existing fleet. The remaining spending relates to the purchase of smaller heavy equipment assets to maintain the current fleet. Sustaining capital additions are typically front-weighted in the year primarily for these two reasons (additions in the first quarters of 2022 and 2021 were 30% and 36%, respectively, of full year spending). Further to the current quarter capital additions is the purchase of equipment upon the wind up of the Dene North Site Services ("DNSS") partnership, totaling $2.6 million.
We finance a portion of our heavy construction fleet through finance leases and we continue to lease our motor vehicle fleet through our finance lease facilities. Our sustaining capital additions financed through finance leases during the three months ended March 31, 2023, was $17.0 million ($8.7 million in the prior year). Our equipment fleet is currently split among owned (65%), finance leased (31%) and rented equipment (4%).
Summary of capital additions in affiliates and joint ventures
Not included in the reconciliation of capital additions above are capital additions made by our affiliates and joint ventures. The table below reflects our share of such capital additions (disposals).
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| | Three months ended, |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Nuna | | $ | (225) | | | $ | 4,868 | |
MNALP | | 5,019 | | | — | |
Fargo | | 2,742 | | | 989 | |
Other | | (1,272) | | | 919 | |
Share of affiliate and joint venture capital additions(i) | | $ | 6,264 | | | $ | 6,776 | |
(i)See "Non-GAAP Financial Measures".
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Management's Discussion and Analysis March 31, 2023 | M-10 | North American Construction Group Ltd. |
Capital additions within the Nuna joint ventures are considered to be sustaining in nature while the capital additions made by the MNALP and Fargo joint ventures were growth given they represent initial investments.
For a complete discussion on our capital expenditures, please see "Liquidity and Capital Resources - Capital Resources" in our most recent annual MD&A for the year ended December 31, 2022.
Summary of consolidated cash flows
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| | Three months ended |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Cash provided by operating activities | | $ | 31,824 | | | $ | 24,185 | |
Cash used in investing activities | | (40,917) | | | (26,811) | |
Cash (used in) provided by financing activities | | (44,447) | | | 6,156 | |
(Decrease) increase in cash | | $ | (53,540) | | | $ | 3,530 | |
Operating activities
| | | | | | | | | | | | | | |
| | Three months ended |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Cash provided by operating activities prior to change in working capital(i) | | $ | 65,835 | | | $ | 44,854 | |
Net changes in non-cash working capital | | (34,011) | | | (20,669) | |
Cash provided by operating activities | | $ | 31,824 | | | $ | 24,185 | |
(i)See "Non-GAAP Financial Measures".
Cash provided by operating activities for the three months ended March 31, 2023, was $31.8 million, compared to cash provided by operating activities of $24.2 million for the three months ended March 31, 2022. The increase in cash flow in the current year period is largely a result of increased net income in the quarter and an increase to dividends and advances received from affiliates and joint ventures, offset by the impact of changes in our working capital accounts. Cash provided by (used in) the net change in non-cash working capital specific to operating activities are summarized in the table below:
| | | | | | | | | | | | | | |
| | Three months ended |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Accounts receivable | | $ | (8,494) | | | $ | 11,082 | |
Contract assets | | 6,063 | | | (943) | |
Inventories | | (3,366) | | | (9,485) | |
Contract costs | | — | | | 653 | |
Prepaid expenses and deposits | | 1,004 | | | 2,450 | |
Accounts payable | | (13,672) | | | (11,186) | |
Accrued liabilities | | (14,139) | | | (11,539) | |
Contract liabilities | | (1,407) | | | (1,701) | |
Net change in non-cash working capital | | $ | (34,011) | | | $ | (20,669) | |
Investing activities
Cash used in investing activities for the three months ended March 31, 2023, was $40.9 million, compared to cash used in investing activities of $26.8 million for the three months ended March 31, 2022. Current period investing activities largely relate to $36.5 million for the purchase of property, plant and equipment and net repayments of loans to affiliates and joint ventures of $5.2 million, partially offset by $1.2 million cash received on the disposal of property, plant and equipment. Prior year investing activities included $25.3 million for the purchase of property, plant and equipment, $1.6 million for the addition to intangible assets for the telematics program, partially offset by $0.5 million cash received on the disposal of property, plant and equipment.
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Management's Discussion and Analysis March 31, 2023 | M-11 | North American Construction Group Ltd. |
Financing activities
Cash used in financing activities during the three months ended March 31, 2023, was $44.4 million, which included $42.2 million of long-term debt repayments and $2.1 million for the dividend payment. Cash provided by financing activities during the three months ended March 31, 2022, was $6.2 million, which included proceeds from long-term debt of $20.0 million, offset by $11.8 million of long-term debt repayments, $1.1 million for the dividend payment and $0.9 million from the share purchase program.
Free cash flow
| | | | | | | | | | | | | | |
| | Three months ended |
| | March 31, |
(dollars in thousands) | | 2023 | | 2022 |
Cash provided by operating activities | | $ | 31,824 | | | $ | 24,185 | |
Cash used in investing activities | | (40,917) | | | (26,811) | |
Capital additions financed by leases | | (17,020) | | | (8,695) | |
Free cash flow(i) | | $ | (26,113) | | | $ | (11,321) | |
(i)See "Non-GAAP Financial Measures".
Free cash flow was a use of cash of $26.1 million in the quarter primarily due to the consumption of $34.0 million by our working capital accounts. This working capital draw on cash is similar to Q1 2022 and is consistent with past seasonal impacts of our annual business cycle. Adjusted EBITDA generated $84.6 million, mentioned above, and when factoring in sustaining capital additions ($47.2 million) and cash interest paid ($6.9 million), positive cash of $30.5 million was generated by the overall business in the quarter but was impacted by joint venture management and other routine timing considerations.
Contractual obligations
Our principal contractual obligations relate to our long-term debt, finance and operating leases, and supplier contracts. The following table summarizes our future contractual obligations as of March 31, 2023, excluding interest where interest is not defined in the contract (operating leases and supplier contracts). The future interest payments were calculated using the applicable interest rates and balances as at March 31, 2023, and may differ from actual results.
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| | Payments due by fiscal year |
(dollars in thousands) | | Total | | 2023 | | 2024 | | 2025 | | 2026 | | 2027 and thereafter |
Credit Facility | | $ | 176,340 | | | $ | 7,856 | | | $ | 10,456 | | | $ | 158,028 | | | $ | — | | | $ | — | |
Convertible debentures | | 159,900 | | | 5,489 | | | 6,861 | | | 6,861 | | | 59,789 | | | 80,900 | |
Equipment financing(i) | | 95,940 | | | 35,945 | | | 37,726 | | | 10,789 | | | 8,220 | | | 3,260 | |
Mortgage | | 42,359 | | | 1,337 | | | 1,783 | | | 1,783 | | | 1,783 | | | 35,673 | |
Operating leases(ii) | | 12,311 | | | 1,008 | | | 766 | | | 1,298 | | | 1,185 | | | 8,054 | |
Non-lease components of lease commitments(iii) | | 2,529 | | | (902) | | | 227 | | | 470 | | | 402 | | | 2,332 | |
Supplier contracts | | 9,035 | | | 9,035 | | | — | | | — | | | — | | | — | |
Contractual obligations | | $ | 498,414 | | | $ | 59,768 | | | $ | 57,819 | | | $ | 179,229 | | | $ | 71,379 | | | $ | 130,219 | |
(i)Finance leases, included in equipment financing, are net of receivable on heavy equipment operating subleases of $3,373 (2023 - $3,373).
(ii)Operating leases are net of receivables on subleases of $1,751 (2023 - $1,251; 2024 - $500).
(iii)Non-lease components of lease commitments are net of receivables on subleases of $1,066 (2023 - $864; 2024 - $202). These commitments include common area maintenance, management fees, property taxes, and parking related to operating leases.
Contractual obligations of $498.4 million as at March 31, 2023, decreased from $537.5 million as at December 31, 2022, primarily related to decreases in the Credit Facility balance of $39.8 million and supplier contracts of $4.3 million, offset by increases in equipment financing of $6.3 million. We have no off-balance sheet arrangements.
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Management's Discussion and Analysis March 31, 2023 | M-12 | North American Construction Group Ltd. |
Credit Facility
On September 20, 2022, we entered into an Amended and Restated Credit Agreement (the "Credit Facility") with a banking syndicate that allows borrowing under the revolving loan to $300.0 million, with the ability to increase the maximum borrowings by an additional $50.0 million subject to certain conditions, and permits finance lease debt to a limit of $175.0 million. This amended agreement extended the maturity to October 8, 2025, with an option to extend on an annual basis, subject to certain conditions. The amended facility maintains financial covenant thresholds as well as other debt limits.
As at March 31, 2023, the Credit Facility had borrowings of $150.0 million (December 31, 2022 - $180.0 million) and $32.0 million in issued letters of credit (December 31, 2022 - $32.0 million). At March 31, 2023, our borrowing availability under the Credit Facility was $118.0 million (December 31, 2022 - $88.0 million).
Under the terms of the Credit Facility the Senior Leverage Ratio is to be maintained at less than or equal to 3.0:1. In the event we enter into a material acquisition, the maximum allowable Senior Leverage Ratio would increase to 3.50:1 for four quarters following the acquisition. The Fixed Charge Coverage Ratio is to be maintained at a ratio greater than 1.15:1.
Financial covenants are to be tested quarterly on a trailing four quarter basis. As at March 31, 2023, we were in compliance with the Credit Facility covenants. We fully expect to maintain compliance with our financial covenants during the subsequent twelve-month period.
For a complete discussion on our Credit Facility, including covenants, calculation of the borrowing base, allowable finance lease debt, and our credit rating, see "Liquidity and Capital Resources - Credit Facility" in our most recent annual MD&A.
Debt ratings
On March 21, 2023, S&P Global Ratings ("S&P") reiterated our Company outlook as "stable" and maintained our long-term corporate credit rating at "B+". For a complete discussion on debt ratings, see "Capital Structure and Securities - Debt Ratings" in our most recent AIF for the year ended December 31, 2022.
Outstanding share data
Common shares
We are authorized to issue an unlimited number of voting common shares and an unlimited number of non-voting common shares. On June 12, 2014, we entered into a trust agreement whereby the trustee may purchase and hold voting common shares, classified as treasury shares on our Consolidated Balance Sheets, until such time that units issued under the equity classified long-term incentive plans are to be settled. Units granted under such plans typically vest at the end of a three-year term.
As at April 21, 2023, there were 27,827,282 voting common shares outstanding, which included 1,418,362 voting common shares held by the trust and classified as treasury shares on our Consolidated Balance Sheets (27,827,282 common shares, including 1,412,502 common shares classified as treasury shares at March 31, 2023).
For a more detailed discussion of our share data, see "Capital Structure and Securities - Capital Structure" in our most recent AIF.
Convertible debentures
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| | March 31, 2023 | | December 31, 2022 |
5.50% convertible debentures | | $ | 74,750 | | | $ | 74,750 | |
5.00% convertible debentures | | 55,000 | | | 55,000 | |
| | $ | 129,750 | | | $ | 129,750 | |
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Management's Discussion and Analysis March 31, 2023 | M-13 | North American Construction Group Ltd. |
The terms of the convertible debentures are summarized as follows:
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| | Date of issuance | | Maturity | | Original conversion price | | Share equivalence per $1000 debenture | | Debt issuance costs |
5.50% convertible debentures | | June 1, 2021 | | June 30, 2028 | | $24.75 | | $ | 40.4040 | | | 3,531 | |
5.00% convertible debentures | | March 20, 2019 | | March 31, 2026 | | $26.25 | | $ | 38.0952 | | | 2,691 | |
Interest on the 5.50% convertible debenture is payable semi-annually in arrears on June 30 and December 31 of each year. Interest on the 5.00% convertible debentures is payable semi-annually on March 31 and September 30 of each year.
The 5.50% convertible debentures are not redeemable prior to June 30, 2024, except under certain exceptional circumstances. The 5.50% convertible debentures may be redeemed at the option of the Company, in whole or in part, at any time on or after June 30, 2024, at a redemption price equal to the principal amount provided that the market price of the common shares is at least 125% of the conversion price; and on or after June 30, 2026, at a redemption price equal to the principal amount. In each case, the Company is required to pay accrued and unpaid interest on the debentures redeemed to the redemption date.
The 5.00% convertible debentures are only redeemable under certain conditions after a change in control has occurred. If a change in control occurs, we are required to offer to purchase all of the 5.00% convertible debentures at a price equal to 101% of the principal amount plus accrued and unpaid interest to the date of purchase.
Share purchase program
On April 9, 2021, we commenced a normal course issuer bid ("NCIB") under which a maximum number of 2,000,000 common shares were authorized to be purchased. During the three months ended March 31, 2022, we purchased and subsequently cancelled 48,592 shares under this NCIB, at an average price of $17.86 per share. This resulted in a decrease to common shares of $0.4 million and a decrease to additional paid-in capital of $0.5 million. This NCIB terminated April 8, 2022. On a combined basis, a total of 119,592 shares were purchased and cancelled under this NCIB.
On April 11, 2022, we commenced a NCIB under which a maximum number of 2,113,054 common shares were authorized to be purchased. As at December 31, 2022, we purchased and subsequently cancelled 2,113,054 shares under this NCIB, at an average price of $15.45 per share.
There were no share purchases during the three months ended March 31, 2023.
Swap Agreement
On October 5, 2022, the Company entered into a swap agreement on its common shares with a financial institution for investment purposes. During the three months ended March 31, 2023, the Company recognized an unrealized gain of $2.5 million on this agreement based on the difference between the par value of the converted shares and the expected price of the Company’s shares at contract maturity. The agreement is for 200,678 shares at a par value of $14.38, and an additional 458,400 shares at a par value of $18.94 (December 31, 2022 - 200,678 shares at a par value of $14.38, and an additional 152,100 shares at a par value of $17.84). The fair value of the shares as at March 31, 2023, was $22.54 (December 31, 2022 - $18.08). The fair value of this swap is recorded in other assets on the Consolidated Balance Sheets. The swap has not been designated as a hedge for accounting purposes and therefore changes in the fair value of the derivative are recognized in the Consolidated Statements of Operations and Comprehensive Income. This swap agreement is expected to mature in October 2023.
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Management's Discussion and Analysis March 31, 2023 | M-14 | North American Construction Group Ltd. |
Backlog
The following summarizes our non-GAAP reconciliation of backlog as at March 31, 2023, and the preceding quarter, as well as revenue generated from backlog for each quarter:
| | | | | | | | | | | | | | |
(dollars in thousands) | | March 31, 2023 | | December 31, 2022 |
Remaining performance obligations per financial statements | | $ | 162,275 | | | $ | 52,526 | |
Add: undefined committed volumes | | 283,003 | | | 516,311 | |
Backlog(i) | | $ | 445,278 | | | $ | 568,837 | |
Equity method investment backlog(i) | | 684,508 | | | 717,849 | |
Combined backlog(i) | | $ | 1,129,786 | | | $ | 1,286,686 | |
(i)See "Non-GAAP Financial Measures".
Backlog decreased $123.6 million, on a net basis, during three months ended March 31, 2023. Revenue generated from backlog during the three months ended March 31, 2023, was $215.1 million and we estimate that $378.1 million of our backlog reported above will be performed over the balance of 2023 (combined total of $593.2 million). For the year ended December 31, 2022, revenue generated from backlog was $433.6 million.
ACCOUNTING ESTIMATES, PRONOUNCEMENTS AND MEASURES
Critical accounting estimates
The preparation of our consolidated financial statements, in conformity with US GAAP, requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the reported amounts of revenues and expenses during the reporting period. For a full discussion of our critical accounting estimates, see "Critical Accounting Estimates" in our annual MD&A for the year ended December 31, 2022.
Change in significant accounting policy - Basis of presentation
Prior to July 1, 2021, we elected to apply the provision available to entities operating within the construction industry
to apply proportionate consolidation to unincorporated entities that would otherwise be accounted for using the
equity method. During the three months ended September 30, 2021, we elected to change this policy to account for
these unincorporated entities using the equity method, resulting in a change to the consolidation method for Dene
North Site Services and Mikisew North American Limited Partnership. This change allows for consistency in the
presentation of our investments in affiliates and joint ventures. We have accounted for the change retrospectively
according to the requirements of US GAAP Accounting Standards Codification ("ASC") 250 by restating the comparative periods. For full disclosure, refer to note 22 in our Financial Statements for December 31, 2021.
Changes in presentation
During the third quarter of 2022, the Company updated the presentation of project and equipment costs within the Consolidated Statement of Operations and Comprehensive Income to be combined as cost of sales. There has been no change in the Company’s accounting policy or change in the composition of the amounts now recognized within cost of sales. The change in presentation had no effect on the reported results of operations. The comparative period has been updated to reflect this presentation change.
During the first quarter of 2023, the Company updated the presentation of finance lease obligations within the Consolidated Balance Sheets to be included in long-term debt. Within the long-term debt note, finance lease obligations, financing obligations, and promissory notes have been combined as equipment financing. Finance lease obligations are the finance lease liabilities recognized in accordance with the Company's lease policy which is disclosed in our Annual Report. Financing obligations arise when the Company finances its owned equipment. There has been no change in the Company’s accounting policy for finance lease obligations or change in the recognition or measurement of the related balances now recognized within long-term debt. The change in presentation had no effect on the reported results of operations. The comparative period has been updated to reflect this presentation change.
Non-GAAP financial measures
We believe that the below non-GAAP financial measures are all meaningful measures of business performance because they include or exclude items that are or are not directly related to the operating performance of our
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Management's Discussion and Analysis March 31, 2023 | M-15 | North American Construction Group Ltd. |
business. Management reviews these measures to determine whether property, plant and equipment are being allocated efficiently.
"Adjusted EBIT" is defined as adjusted net earnings before the effects of interest expense, income taxes and equity earnings in affiliates and joint ventures, but including the equity investment EBIT from our affiliates and joint ventures accounted for using the equity method.
"Adjusted EBITDA" is defined as adjusted EBIT before the effects of depreciation, amortization and equity investment depreciation and amortization.
"Adjusted EPS" is defined as adjusted net earnings, divided by the weighted-average number of common shares.
"Adjusted net earnings" is defined as net income available to shareholders excluding the effects of unrealized foreign exchange gain or loss, realized and unrealized gain or loss on derivative financial instruments, cash and non-cash (liability and equity classified) stock-based compensation expense, gain or loss on disposal of property, plant and equipment, and certain other non-cash items included in the calculation of net income. These adjustments are tax effected in the calculation of adjusted net earnings.
As adjusted EBIT, adjusted EBITDA, adjusted net earnings and adjusted EPS are non-GAAP financial measures, our computations may vary from others in our industry. These measures should not be considered as alternatives to operating income or net income as measures of operating performance or cash flows and they have important limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of our results as reported under US GAAP. For example, adjusted EBITDA does not:
•reflect our cash expenditures or requirements for capital expenditures or capital commitments or proceeds from capital disposals;
•reflect changes in our cash requirements for our working capital needs;
•reflect the interest expense or the cash requirements necessary to service interest or principal payments on our debt;
•include tax payments or recoveries that represent a reduction or increase in cash available to us; or
•reflect any cash requirements for assets being depreciated and amortized that may have to be replaced in the future.
"Backlog" is a measure of the amount of secured work we have outstanding and, as such, is an indicator of a base level of future revenue potential. We define backlog as work that has a high certainty of being performed as evidenced by the existence of a signed contract or work order specifying expected job scope, value and timing. Backlog, while not a GAAP term is similar in nature and definition to the "transaction price allocated to the remaining performance obligations", defined under US GAAP and reported in "Note 4 - Revenue" in our financial statements. When the two numbers differ, the variance relates to expected scope where we have a contractual commitment, but the customer has not yet provided specific direction. Our equity consolidated backlog is calculated based on backlog amounts from our joint venture and affiliates and taken at our ownership percentage.
"Capital additions" is defined as capital expenditures, net and lease additions.
"Capital expenditures, net" is defined as growth capital and sustaining capital. We believe that capital expenditures, net and its components are a meaningful measure to assess resource allocation.
"Capital inventory" is defined as rotatable parts included in property, plant and equipment held for use in the overhaul of property, plant and equipment.
"Capital work in progress" is defined growth capital and sustaining capital prior to commissioning and not available for use.
"Cash provided by operating activities prior to change in working capital" is defined as cash used in or provided by operating activities excluding net changes in non-cash working capital.
"Combined gross profit" is defined as consolidated gross profit per the financial statements combined with our share of gross profit from affiliates and joint ventures that are accounted for using the equity method. This measure is reviewed by management to assess the impact of affiliates and joint ventures’ gross profit on our adjusted EBITDA margin.
| | | | | | | | |
Management's Discussion and Analysis March 31, 2023 | M-16 | North American Construction Group Ltd. |
"Equity method investment backlog" is a measure of our proportionate share (based on ownership interest) of backlog from affiliates and joint ventures that are accounted for using the equity method.
"Equity investment depreciation and amortization" is defined as our proportionate share (based on ownership interest) of depreciation and amortization in other affiliates and joint ventures accounted for using the equity method.
"Equity investment EBIT" is defined as our proportionate share (based on ownership interest) of equity earnings in affiliates and joint ventures before the effects of gain or loss on disposal of property, plant and equipment, interest expense and income taxes.
"Free cash flow" is defined as cash from operations less cash used in investing activities including finance lease additions but excluding cash used for growth capital. For clarity, based on this definition cash generated by joint venture is reported as free cash flow upon issuance of dividends or advances. We believe that free cash flow is a relevant measure of cash available to service our total debt repayment commitments, pay dividends, fund share purchases and fund both growth capital expenditures and potential strategic initiatives.
"Growth capital" is defined as new or used revenue-generating and customer facing assets which are not intended to replace an existing asset and have been commissioned and are available for use. These expenditures result in a meaningful increase to earnings and cash flow potential.
"Invested capital" is defined as total shareholders' equity plus net debt.
"Net debt" is defined as total debt less cash and cash equivalents recorded on the balance sheets. Net debt is used by us in assessing our debt repayment requirements after using available cash.
"Senior debt" is defined as total debt, excluding convertible debentures, deferred financing costs, mortgages related to NACG Acheson Ltd. and debt related to investment in affiliates and joint ventures. Senior debt is used primarily for our bank covenants contained in the Credit Facility agreement.
"Share of affiliate and joint venture capital additions" is defined as our proportionate share (based on ownership interest) of capital expenditures, net and lease additions from affiliates and joint ventures that are accounted for using the equity method.
"Sustaining capital" is defined as expenditures, net of routine disposals, related to property, plant and equipment which have been commissioned and are available for use operated to maintain and support existing earnings and cash flow potential and do not include the characteristics of growth capital.
"Total capital liquidity" is defined as total liquidity plus unused finance lease and other borrowing availability under our Credit Facility.
"Total combined revenue" is defined as consolidated revenue per the financial statements combined with our share of revenue from affiliates and joint ventures that are accounted for using the equity method. This measure is reviewed by management to assess the impact of affiliates and joint ventures' revenue on our adjusted EBITDA margin.
"Total debt" is defined as the sum of the outstanding principal balance (current and long-term portions) of: (i) finance leases; (ii) borrowings under our credit facilities (excluding outstanding Letters of Credit); (iii) convertible unsecured subordinated debentures; (iv) mortgage; (v) promissory notes; and (vi) financing obligations. We believe total debt is a meaningful measure in understanding our complete debt obligations.
Non-GAAP ratios
"Margin" is defined as the financial number as a percent of total reported revenue. We will often identify a relevant financial metric as a percentage of revenue and refer to this as a margin for that financial metric.
"Adjusted EBITDA Margin" is defined as adjusted EBITDA divided by total combined revenue.
"Combined gross profit margin" is defined as combined gross profit divided by total combined revenue.
We believe that presenting relevant financial metrics as a percentage of revenue is a meaningful measure of our business as it provides the performance of the financial metric in the context of the performance of revenue. Management reviews margins as part of its financial metrics to assess the relative performance of its results.
Supplementary Financial Measures
| | | | | | | | |
Management's Discussion and Analysis March 31, 2023 | M-17 | North American Construction Group Ltd. |
"Gross profit margin" represents gross profit as a percentage of revenue.
"Total net working capital (excluding cash)" represents net working capital, less the cash balance.
INTERNAL SYSTEMS AND PROCESSES
Evaluation of disclosure controls and procedures
Our disclosure controls and procedures are designed to provide reasonable assurance that information we are required to disclose is recorded, processed, summarized and reported within the time periods specified under Canadian and US securities laws. They include controls and procedures designed to ensure that information is accumulated and communicated to management, including the Chief Executive Officer and the Executive Vice President & Chief Financial Officer to allow timely decisions regarding required disclosures.
An evaluation was carried out under the supervision of and with the participation of management, including the Chief Executive Officer and the Executive Vice President & Chief Financial Officer of the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the US Securities Exchange Act of 1934, as amended, and in National Instrument 52-109 under the Canadian Securities Administrators Rules and Policies. Based on this evaluation, our Chief Executive Officer and the Executive Vice President & Chief Financial Officer concluded that as of March 31, 2023, such disclosure controls and procedures were effective.
Management’s report on internal control over financial reporting
There have been no significant changes to our internal controls over financial reporting ("ICFR") for the three months ended March 31, 2023, that have materially affected, or are reasonably likely to affect, our ICFR.
LEGAL AND LABOUR MATTERS
Laws and Regulations and Environmental Matters
Please see "Our Business - Health, Safety and Environmental" in our most recent Annual Information Form for a complete discussion on this topic.
Employees and Labour Relations
As at March 31, 2023, we had 206 salaried employees (March 31, 2022 - 196 salaried employees) and 1,719 hourly employees (March 31, 2022 - 1,657 hourly employees) in our western Canadian operations (excluding employees employed by affiliates and joint ventures). Of the hourly employees, approximately 84% of the employees are union members and work under collective bargaining agreements (March 31, 2022 - 84% of the employees). Our hourly workforce fluctuates according to the seasonality of our business and the staging and timing of projects by our customers. The hourly workforce for our ongoing operations ranges in size from approximately 700 employees to approximately 1,800 employees, depending on the time of year, types of work and duration of awarded projects. We also utilize the services of subcontractors in our business. Subcontractors perform an estimated 7% to 10% of the work we undertake.
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Management's Discussion and Analysis March 31, 2023 | M-18 | North American Construction Group Ltd. |
OUTLOOK
Our expectation of projected free cash flows for the full year 2023, in the range of $100 to $115 million, has increased from previous reporting and would improve our liquidity position. We maintain our belief that we have the contracted work to provide sufficient free cash flow to both de-lever our balance sheet and pursue opportunities to continue our diversification and growth objectives.
| | | | | | | | |
Key measures | | 2023 |
Adjusted EBITDA(i) | | $255 - $275M |
Sustaining capital(i) | | $120 - $130M |
Adjusted EPS(i) | | $2.40 - $2.60 |
Free cash flow(i) | | $100 - $115M |
| | |
Capital allocation | | |
Deleverage | | $70 - $80M |
Shareholder activity(ii) | | $15 - $25M |
Growth spending(i) | | $5 - $10M |
| | |
Leverage ratios | | |
Senior debt(i) | | 1.0x - 1.2x |
Net debt(i) | | 1.1x - 1.3x |
(i)See "Non-GAAP Financial Measures".
(ii)Shareholder activity includes common shares purchased under a NCIB, dividends paid and the purchase of treasury shares.FORWARD-LOOKING INFORMATION
Our MD&A is intended to enable readers to gain an understanding of our current results and financial position. To do so, we provide information and analysis comparing results of operations and financial position for the current period to that of the preceding periods. We also provide analysis and commentary that we believe is necessary to assess our future prospects. Accordingly, certain sections of this report contain forward-looking information that is based on current plans and expectations. Our forward-looking information is information that is subject to known and unknown risks and other factors that may cause future actions, conditions or events to differ materially from the anticipated actions, conditions or events expressed or implied by such forward-looking information. Readers are cautioned that actual events and results may vary from the forward-looking information.
Forward-looking information is information that does not relate strictly to historical or current facts and can be identified by the use of the future tense or other forward-looking words such as "believe", "continue", "expect", "project", "will" or the negative of those terms or other variations of them or comparable terminology.
Examples of such forward-looking information in this document include, but are not limited to, statements with respect to the following, each of which is subject to significant risks and uncertainties and is based on a number of assumptions which may prove to be incorrect.
•Our belief that joint venture initiatives will continue to gain momentum as drivers of our combined revenue.
•Our belief that there is minimal risk in the collection of our trade receivables.
•All statements regarding levels of backlog and the periods of time over which we expect to perform backlog.
•Our expectation that we will maintain compliance with financial covenants during the next twelve-month period.
•Our expectation of free cash flows, in the range of $100 to $115 million, will improve liquidity over 2023.
•Our belief that we have the contracted work to provide sufficient free cash flow to both de-lever our balance sheet significantly and pursue opportunities to continue our diversification and growth objectives.
Assumptions
Material factors or assumptions used to develop forward-looking statements include, but are not limited to:
•commodity prices, in the markets we service, remaining stable and not dropping significantly for the remainder of 2023;
•oil sands production continuing to be resilient;
•continuing demand for heavy construction and earth-moving services, including that actual demand will exceed contractually committed demand at levels consistent with past experience;
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Management's Discussion and Analysis March 31, 2023 | M-19 | North American Construction Group Ltd. |
•continuing demand for external heavy equipment maintenance services and our ability to hire and retain sufficient qualified personnel and to have sufficient maintenance facility capacity to capitalize on demand;
•our ability to maintain our expenses at current levels in proportion to our revenue;
•work continuing to be required under our master services agreements with various customers and such master services agreements remaining intact;
•our customers' continued willingness and ability to meet their contractual obligations to us;
•our customers' continued economic viability, including their ability to pay us in a timely fashion;
•our customers and potential customers continuing to outsource activities for which we are capable of providing services;
•our ability to maintain the right size and mix of equipment in our fleet and to secure specific types of rental equipment to support project development activity enables us to meet our customers' variable service requirements while balancing the need to maximize utilization of our own equipment and that our equipment maintenance costs are similar to our historical experience;
•our continued ability to access sufficient funds to meet our funding requirements;
•our success in executing our business strategy, identifying and capitalizing on opportunities, managing our business, maintaining and growing our relationships with customers, retaining new customers, competing in the bidding process to secure new projects and identifying and implementing improvements in our maintenance and fleet management practices;
•our relationships with the unions representing certain of our employees continuing to be positive; and
•our success in improving profitability and continuing to strengthen our balance sheet through a focus on performance, efficiency, and risk management.
These material factors and assumptions are subject to the risks and uncertainties highlighted in our MD&A for the year ended December 31, 2022, and in our most recently filed Annual Information Form.
While we anticipate that subsequent events and developments may cause our views to change, we do not have an intention to update this forward-looking information, except as required by applicable securities laws. This forward-looking information represents our views as of the date of this document and such information should not be relied upon as representing our views as of any date subsequent to the date of this document. We have attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those expected or estimated in such statements. Accordingly, readers should not place undue reliance on forward-looking information. These factors are not intended to represent a complete list of the factors that could affect us. See "Assumptions" above, "Assumptions" and "Business Risk Factors" in our annual MD&A for the year ended December 31, 2022, and risk factors highlighted in materials filed with the securities regulatory authorities filed in the United States and Canada from time to time, including, but not limited to, our most recent Annual Information Form.
Risk Management
We are exposed to liquidity, market, and credit risks associated with its financial instruments. Management performs a risk assessment on a continual basis to help ensure that all significant risks related to our Company and operations have been reviewed and assessed to reflect changes in market conditions and operating activities.
Market Risk
Market risk is the risk that the future revenue or operating expense related cash flows, the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices such as foreign currency exchange rates and interest rates. The level of market risk to which the Company is exposed to at any point in time varies depending on market conditions, expectations of future price or market rate movements and composition of the Company's financial assets and liabilities held, non-trading physical assets, and contract portfolios. We have experienced no material change in market risk as of the quarter ended March 31, 2023. For a full discussion of market risk please see our annual MD&A for the year ended December 31, 2022.
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Management's Discussion and Analysis March 31, 2023 | M-20 | North American Construction Group Ltd. |
ADDITIONAL INFORMATION
Our corporate head office is located at 27287 - 100 Avenue, Acheson, Alberta, T7X 6H8. Telephone and facsimile are 780-960-7171 and 780-969-5599, respectively.
Additional information relating to us, including our AIF dated December 31, 2022, can be found on the Canadian Securities Administrators System for Electronic Document Analysis and Retrieval ("SEDAR") database at www.sedar.com, the Securities and Exchange Commission’s website at www.sec.gov and on our Company website at www.nacg.ca.
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Management's Discussion and Analysis March 31, 2023 | M-21 | North American Construction Group Ltd. |
Interim Consolidated Balance Sheets
(Expressed in thousands of Canadian Dollars)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| Note | | March 31, 2023 | | December 31, 2022 |
Assets | | | | | |
Current assets | | | | | |
Cash | | | $ | 15,659 | | | $ | 69,144 | |
Accounts receivable | 3, 6 | | 92,305 | | | 83,811 | |
Contract assets | 4(b) | | 9,739 | | | 15,802 | |
Inventories | 5 | | | 53,264 | | | 49,898 | |
Prepaid expenses and deposits | | | 9,535 | | | 10,587 | |
Assets held for sale | | | 373 | | | 1,117 | |
| | | 180,875 | | | 230,359 | |
Property, plant and equipment, net of accumulated depreciation of $394,057 (December 31, 2022 – $387,358) | | | 663,476 | | | 645,810 | |
Operating lease right-of-use assets | | | 14,289 | | | 14,739 | |
Intangible assets | | | 6,593 | | | 6,773 | |
Investments in affiliates and joint ventures | 6 | | | 76,703 | | | 75,637 | |
Other assets | | | 8,079 | | | 5,808 | |
Deferred tax assets | | | — | | | 387 | |
Total assets | | | $ | 950,015 | | | $ | 979,513 | |
Liabilities and shareholders’ equity | | | | | |
Current liabilities | | | | | |
Accounts payable | | | $ | 81,377 | | | $ | 102,549 | |
Accrued liabilities | | | 30,954 | | | 43,784 | |
Contract liabilities | 4(b) | | 4 | | | 1,411 | |
Current portion of long-term debt | 7 | | | 42,818 | | | 42,089 | |
Current portion of operating lease liabilities | | | 2,561 | | | 2,470 | |
| | | 157,714 | | | 192,303 | |
Long-term debt | 7 | | | 352,719 | | | 378,452 | |
Operating lease liabilities | | | 12,385 | | | 12,376 | |
Other long-term obligations | | | 21,946 | | | 18,576 | |
Deferred tax liabilities | | | 79,032 | | | 71,887 | |
| | | 623,796 | | | 673,594 | |
Shareholders' equity | | | | | |
Common shares (authorized – unlimited number of voting common shares; issued and outstanding – March 31, 2023 - 27,827,282 (December 31, 2022 – 27,827,282)) | 8(a) | | 229,455 | | | 229,455 | |
Treasury shares (March 31, 2023 - 1,412,502 (December 31, 2022 - 1,406,461)) | 8(a) | | (16,554) | | | (16,438) | |
Additional paid-in capital | | | 23,231 | | | 22,095 | |
Retained earnings | | | 89,726 | | | 70,501 | |
Accumulated other comprehensive income | | | 361 | | | 306 | |
Shareholders' equity | | | 326,219 | | | 305,919 | |
Total liabilities and shareholders’ equity | | | $ | 950,015 | | | $ | 979,513 | |
| | | | | |
See accompanying notes to interim consolidated financial statements.
| | | | | | | | |
Interim Consolidated Financial Statements (Unaudited) March 31, 2023 | F-1 | North American Construction Group Ltd. |
Interim Consolidated Statements of Operations and
Comprehensive Income
(Expressed in thousands of Canadian Dollars, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three months ended |
| | | March 31, |
| Note | | 2023 | | 2022 |
Revenue | 4, 6 | | $ | 242,605 | | | $ | 176,711 | |
Cost of sales | 2, 9 | | 165,301 | | | 124,068 | |
Depreciation | | | 36,385 | | | 30,692 | |
Gross profit | | | 40,919 | | | 21,951 | |
General and administrative expenses | | | 14,179 | | | 6,232 | |
Loss on disposal of property, plant and equipment | | | 1,213 | | | 77 | |
Operating income | | | 25,527 | | | 15,642 | |
Interest expense, net | 10 | | | 7,311 | | | 4,682 | |
Equity earnings in affiliates and joint ventures | 6 | | | (9,523) | | | (6,241) | |
Net unrealized gain on derivative financial instruments | 11(b) | | (2,509) | | | — | |
Income before income taxes | | | 30,248 | | | 17,201 | |
Current income tax expense | | | 1,136 | | | 162 | |
Deferred income tax expense | | | 7,266 | | | 3,482 | |
Net income | | | 21,846 | | | 13,557 | |
Other comprehensive income | | | | | |
Unrealized foreign currency translation (gain) loss | | | (55) | | | 9 | |
Comprehensive income | | | $ | 21,901 | | | $ | 13,548 | |
Per share information | | | | | |
Basic net income per share | 8(b) | | $ | 0.83 | | | $ | 0.48 | |
Diluted net income per share | 8(b) | | $ | 0.71 | | | $ | 0.43 | |
See accompanying notes to interim consolidated financial statements.
| | | | | | | | |
Interim Consolidated Financial Statements (Unaudited) March 31, 2023 | F-2 | North American Construction Group Ltd. |
Interim Consolidated Statements of Changes in
Shareholders’ Equity
(Expressed in thousands of Canadian Dollars)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Common shares | | Treasury shares | | Additional paid-in capital | | Retained earnings | | Accumulated other comprehensive income (loss) | | Equity |
Balance at December 31, 2021 | | $ | 246,944 | | | $ | (17,802) | | | $ | 37,456 | | | $ | 11,863 | | | $ | 2 | | | $ | 278,463 | |
Net income | | — | | | — | | | — | | | 13,557 | | | — | | | 13,557 | |
Unrealized foreign currency translation loss | | — | | | — | | | — | | | — | | | (9) | | | (9) | |
Dividends ($0.08 per share) | | — | | | — | | | — | | | (2,277) | | | — | | | (2,277) | |
Share purchase program | | (391) | | | — | | | (477) | | | — | | | — | | | (868) | |
Purchase of treasury shares | | — | | | (67) | | | — | | | — | | | — | | | (67) | |
Stock-based compensation | | — | | | — | | | 1,149 | | | — | | | — | | | 1,149 | |
Balance at March 31, 2022 | | $ | 246,553 | | | $ | (17,869) | | | $ | 38,128 | | | $ | 23,143 | | | $ | (7) | | | $ | 289,948 | |
| | | | | | | | | | | | |
Balance at December 31,2022 | | $ | 229,455 | | | $ | (16,438) | | | $ | 22,095 | | | $ | 70,501 | | | $ | 306 | | | $ | 305,919 | |
Net income | | — | | | — | | | — | | | 21,846 | | | — | | | 21,846 | |
Unrealized foreign currency translation gain | | — | | | — | | | — | | | — | | | 55 | | | 55 | |
Dividends ($0.10 per share) | | — | | | — | | | — | | | (2,621) | | | — | | | (2,621) | |
Purchase of treasury shares | | — | | | (116) | | | — | | | — | | | — | | | (116) | |
Stock-based compensation | | — | | | — | | | 1,136 | | | — | | | — | | | 1,136 | |
Balance at March 31, 2023 | | $ | 229,455 | | | $ | (16,554) | | | $ | 23,231 | | | $ | 89,726 | | | $ | 361 | | | $ | 326,219 | |
See accompanying notes to interim consolidated financial statements.
| | | | | | | | |
Interim Consolidated Financial Statements (Unaudited) March 31, 2023 | F-3 | North American Construction Group Ltd. |
Interim Consolidated Statements of Cash Flows
(Expressed in thousands of Canadian Dollars)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three months ended |
| | | March 31, |
| Note | | 2023 | | 2022 |
Cash provided by (used in) | | | | | |
Operating activities: | | | | | |
Net income | | | $ | 21,846 | | | $ | 13,557 | |
Adjustments to reconcile net income to cash from operating activities: | | | | | |
Depreciation | | | 36,385 | | | 30,692 | |
Amortization of deferred financing costs | 10 | | | 289 | | | 281 | |
Loss on disposal of property, plant and equipment | | | 1,213 | | | 77 | |
Net unrealized gain on derivative financial instruments | | | (2,509) | | | — | |
Stock-based compensation expense | | | 5,937 | | | 1,277 | |
Equity earnings in affiliates and joint ventures | 6 | | | (9,523) | | | (6,241) | |
Dividends and advances received from affiliates and joint ventures | 6 | | | 4,277 | | | 1,396 | |
Other adjustments to cash from operating activities | | | 654 | | | 333 | |
Deferred income tax expense | | | 7,266 | | | 3,482 | |
Net changes in non-cash working capital | 12(b) | | (34,011) | | | (20,669) | |
| | | 31,824 | | | 24,185 | |
Investing activities: | | | | | |
Purchase of property, plant and equipment | | | (36,496) | | | (25,265) | |
Additions to intangible assets | | | (2) | | | (1,573) | |
Proceeds on disposal of property, plant and equipment | | | 1,198 | | | 518 | |
Investment in affiliates and joint ventures | 6 | | | — | | | (163) | |
Net payment on the wind up of affiliates and joint ventures | 6 | | | (387) | | | — | |
Net repayments and advances of loans to affiliates and joint ventures | | | (5,230) | | | (328) | |
| | | (40,917) | | | (26,811) | |
Financing activities: | | | | | |
Proceeds from long-term debt | 7 | | | — | | | 20,000 | |
Repayment of long-term debt | 7 | | | (42,233) | | | (11,771) | |
Dividends paid | 8(d) | | (2,098) | | | (1,138) | |
Share purchase program | | | — | | | (868) | |
Purchase of treasury shares | 8(a) | | (116) | | | (67) | |
| | | (44,447) | | | 6,156 | |
(Decrease) increase in cash | | | (53,540) | | | 3,530 | |
Effect of exchange rate on changes in cash | | | 55 | | | (9) | |
Cash, beginning of period | | | 69,144 | | | 16,601 | |
Cash, end of period | | | $ | 15,659 | | | $ | 20,122 | |
Supplemental cash flow information (note 12(a)).
See accompanying notes to interim consolidated financial statements.
| | | | | | | | |
Interim Consolidated Financial Statements (Unaudited) March 31, 2023 | F-4 | North American Construction Group Ltd. |