Acadian Timber Corp. (“Acadian” or the “Company”) (TSX:ADN) today
reported financial and operating results1 for the three months
ended June 26, 2021 (the “second quarter”).
“With favourable operating conditions and steady
demand for our products, we were able to reduce our inventory and
recover the volume shortfall of the first quarter,” commented Erika
Reilly, Chief Executive Officer. “Acadian expects continued steady
demand for its key products for the remainder of the year.”
Acadian generated $2.9 million of Free Cash Flow
and declared dividends of $4.8 million to its shareholders during
the second quarter, reflecting the seasonality of the business.
Acadian’s balance sheet remains solid with $20.1 million of net
liquidity as at June 26, 2021, which includes funds available under
our credit facilities.
With health and safety continuing as a top
focus, Acadian experienced no recordable safety incidents among
employees and contractors during the second quarter.
1 This news release makes reference to
Adjusted EBITDA, Adjusted EBITDA margin, Free Cash Flow and Payout
Ratio which are key performance measures in evaluating Acadian’s
operations and are important in enhancing investors’ understanding
of Acadian’s operating performance. Adjusted EBITDA and Adjusted
EBITDA margin are used to evaluate operational performance. Free
Cash Flow is used to evaluate Acadian’s ability to generate
sustainable cash flows from its operations while the Payout Ratio
is used to evaluate Acadian’s ability to fund its distribution
using Free Cash Flow. Acadian’s management defines Adjusted EBITDA
as earnings before interest, taxes, fair value adjustments,
recovery of or impairment of land and roads, realized gain/loss on
sale of other fixed assets, unrealized exchange gain/loss on debt,
depreciation and amortization and Adjusted EBITDA margin as
Adjusted EBITDA as a percentage of its total revenue. Free Cash
Flow is defined as Adjusted EBITDA less interest paid, current
income tax expense, and capital expenditures plus net proceeds from
the sale of fixed assets (selling price less gains or losses
included in Adjusted EBITDA). Payout Ratio is defined as dividends
declared divided by Free Cash Flow. As these performance measures
do not have standardized meanings prescribed by International
Financial Reporting Standards (“IFRS”), they may not be comparable
to similar measures presented by other companies. As a result, we
have provided in this news release reconciliations of net income,
as determined in accordance with IFRS, to Adjusted EBITDA and Free
Cash Flow.
Review of Operations
Operating and Financial
Highlights
|
Three Months Ended |
Six Months Ended |
(CAD thousands, except per share information) |
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
Sales volume (000s m3) |
|
211.3 |
|
|
139.7 |
|
|
501.3 |
|
|
514.6 |
|
Sales |
$ |
18,414 |
|
$ |
11,458 |
|
$ |
44,306 |
|
$ |
42,866 |
|
Operating earnings |
|
3,763 |
|
|
1,283 |
|
|
10,503 |
|
|
9,546 |
|
Net income |
|
5,898 |
|
|
5,229 |
|
|
11,722 |
|
|
1,518 |
|
Adjusted EBITDA |
$ |
3,827 |
|
$ |
1,354 |
|
$ |
10,701 |
|
$ |
9,683 |
|
Adjusted EBITDA margin |
|
21% |
|
|
12% |
|
|
24% |
|
|
23% |
|
Free Cash Flow |
$ |
2,864 |
|
$ |
(208 |
) |
$ |
7,854 |
|
$ |
6,357 |
|
Dividends declared |
|
4,839 |
|
|
4,839 |
|
|
9,678 |
|
|
9,678 |
|
Payout Ratio |
|
n/a |
|
|
n/a |
|
|
123% |
|
|
152% |
|
Per share – basic and diluted |
|
|
|
|
Net income |
$ |
0.35 |
|
$ |
0.31 |
|
$ |
0.70 |
|
$ |
0.09 |
|
Free Cash Flow |
|
0.17 |
|
|
(0.01 |
) |
|
0.47 |
|
|
0.38 |
|
Dividends declared |
|
0.29 |
|
|
0.29 |
|
|
0.58 |
|
|
0.58 |
|
During the second quarter, Acadian generated
sales of $18.4 million, compared to $11.5 million in the prior year
period. Sales volume, excluding biomass, increased 55% over the
prior year period due to favourable operating conditions and stable
demand. Acadian recovered the volume shortfall of the first
quarter, benefiting from an earlier start following the spring thaw
and more operating days compared to the prior year period. Weighted
average selling price, excluding biomass, was flat year-over-year
as increased sawlog pricing was offset by weaker pulpwood pricing
and a stronger Canadian dollar.
Operating costs and expenses were $14.7 million
during the second quarter, compared to $10.2 million in the prior
year period, reflecting higher sales volumes and timber services
activity. Weighted average variable costs, excluding biomass,
decreased 9%, as a result of lower processing costs and a stronger
Canadian dollar compared to the prior year period.
Adjusted EBITDA was $3.8 million during the
second quarter, compared to $1.4 million in the prior year period
while the Adjusted EBITDA margin for the quarter was 21%, compared
to 12% in the prior year period for the reasons discussed above.
Free Cash Flow was $2.9 million compared to $0.2 million of
negative Free Cash Flow in the same period in 2020.
Net income for the second quarter totaled $5.9
million, or $0.35 per share, compared to a net income of $5.2
million, or $0.31 per share in the same period in 2020. The
increase in net income from the prior year period is due to
increased operating earnings offset by a combination of lower
non-cash fair value adjustments and unrealized foreign exchange
gain on long-term debt in 2021 compared to 2020.
During the first half of 2021, Acadian sales of
$44.3 million increased 3% compared to the prior year period. The
weighted average selling price, excluding biomass, decreased 1%,
and the sales volume was flat year-over-year. Operating costs and
expenses of $33.8 million were also flat year-over-year. Strong
sawlogs prices, lower administrative costs, and increased timber
services revenues resulted in Adjusted EBITDA of $10.7 million
compared to $9.7 million during the first half of 2020. Adjusted
EBITDA margin improved to 24% from 23%.
For the six months ended June 26, 2021, net
income was $11.7 million, or $0.70 per share, which represents an
increase of $10.2 million compared to the prior period, primarily
as a result of a non-cash unrealized foreign exchange gain on long
term debt of $3.5 million this year compared to a loss of $5.2
million in 2020 combined with lower administrative costs and
interest expense.
Segment Performance
New Brunswick Timberlands
The table below summarizes operating and
financial results for New Brunswick Timberlands.
|
Three Months
Ended June 26, 2021 |
|
Three Months Ended June 27, 2020 |
|
|
Harvest (000s
m3) |
Sales (000s
m3) |
Sales Mix |
|
|
Results ($000) |
|
Harvest (000s m3) |
Sales (000s m3) |
Sales Mix |
|
|
Results ($000s) |
|
Softwood |
41.0 |
54.9 |
33% |
|
$ |
3,464 |
|
42.3 |
48.3 |
40% |
|
$ |
2,506 |
|
Hardwood |
78.8 |
88.9 |
54% |
|
|
6,476 |
|
32.0 |
53.6 |
45% |
|
|
4,248 |
|
Biomass |
21.4 |
21.4 |
13% |
|
|
878 |
|
17.7 |
17.7 |
15% |
|
|
631 |
|
|
141.2 |
165.2 |
100% |
|
|
10,818 |
|
92.0 |
119.6 |
100% |
|
|
7,385 |
|
Timber services and other |
|
|
|
4,056 |
|
|
|
|
|
2,097 |
|
Sales |
|
|
|
$ |
14,874 |
|
|
|
|
$ |
9,482 |
|
Adjusted EBITDA |
|
|
|
$ |
3,839 |
|
|
|
|
$ |
1,781 |
|
Adjusted EBITDA margin |
|
|
|
26% |
|
|
|
|
|
19% |
|
|
Six Months
Ended June 26, 2021 |
|
Six Months Ended June 27, 2020 |
|
|
Harvest (000s
m3) |
Sales (000s
m3) |
Sales Mix |
|
|
Results ($000) |
|
Harvest (000s m3) |
Sales (000s m3) |
Sales Mix |
|
Results ($000s) |
|
Softwood |
139.2 |
141.4 |
40% |
|
$ |
9,031 |
|
158.8 |
161.7 |
43% |
|
$ |
9,138 |
|
Hardwood |
159.8 |
163.0 |
46% |
|
|
12,287 |
|
135.8 |
149.6 |
40% |
|
|
12,013 |
|
Biomass |
51.0 |
51.0 |
14% |
|
|
2,087 |
|
62.5 |
62.5 |
17% |
|
|
2,124 |
|
|
350.0 |
355.4 |
100% |
|
|
23,405 |
|
357.1 |
373.8 |
100% |
|
|
23,275 |
|
Timber services and other |
|
|
|
9,790 |
|
|
|
|
|
7,904 |
|
Sales |
|
|
|
$ |
33,195 |
|
|
|
|
$ |
31,179 |
|
Adjusted EBITDA |
|
|
|
$ |
8,198 |
|
|
|
|
$ |
7,660 |
|
Adjusted EBITDA margin |
|
|
|
27% |
|
|
|
|
|
25% |
|
Sales for New Brunswick Timberlands were $14.9
million during the second quarter, compared to $9.5 million during
the prior year period. Sales volume, excluding biomass, increased
41% relative to the same period in 2020, mainly due to higher
softwood sawlogs and hardwood pulpwood sales. During the second
quarter, New Brunswick’s operations benefited from favourable
operating conditions and recovered the volume shortfall of the
first quarter, except for softwood pulpwood, for which demand
remained weak. Biomass sales volume increased 21% due to strong
deliveries to export markets. The weighted average selling price,
excluding biomass, for the second quarter was $69.13 per m3, or 4%
higher than the prior year period, reflecting strong sawlog prices
and a favourable product mix. Biomass pricing was up 15%
year-over-year reflecting the higher average hauling distance to
market driven by the customer mix.
Operating costs and expenses were $11.1 million
during the second quarter, compared to $7.7 million in the prior
year period due to higher harvesting and timber services activity.
Favourable operating conditions during the quarter, resulted in
more operating days than in the prior year period. Weighted average
variable costs, excluding biomass, decreased by 7% due to lower log
processing costs compared to the prior year period.
Adjusted EBITDA for the quarter was $3.8 million
compared to $1.8 million during the prior year period and Adjusted
EBITDA margin increased to 26% from 19% in the prior year period.
Adjusted EBITDA increase was driven by higher sales volumes and
additional revenues from timber services.
During the first half of 2021, New Brunswick
Timberlands’ sales of $33.2 million increased 6% compared to the
prior year period. The weighted average selling price, excluding
biomass, increased 3%, however the sales volume, excluding biomass,
decreased 2% year-over-year. The volume decrease reflects the lower
softwood pulpwood deliveries due to the increased availability of
sawmill residuals in the region. Operating costs and expenses of
$24.4 million during the first half of 2021 were $0.8 million
higher than the prior year period due to higher timber services
activity. As a result of higher sales and lower administration
costs, Adjusted EBITDA increased to $8.9 million from $7.7 million
during the first half of 2020, and Adjusted EBITDA margin improved
to 27% from 25%.
There were no recordable safety incidents
amongst employees or contractors during the second quarter of
2021.
Maine Timberlands
The table below summarizes operating and
financial results for Maine Timberlands.
|
Three Months Ended June 26, 2021 |
|
Three Months Ended June 27, 2020 |
|
|
Harvest (000s
m3) |
Sales (000s
m3) |
Sales Mix |
|
Results ($000s) |
|
Harvest (000s m3) |
Sales (000s m3) |
Sales Mix |
|
Results ($000s) |
|
Softwood |
27.6 |
27.5 |
60% |
|
$ |
1,855 |
|
10.4 |
10.2 |
51% |
|
$ |
810 |
|
Hardwood |
10.0 |
18.3 |
40% |
|
|
1,552 |
|
7.3 |
9.8 |
49% |
|
|
1,025 |
|
Biomass |
0.3 |
0.3 |
0% |
|
|
3 |
|
0.1 |
0.1 |
0% |
|
|
— |
|
|
37.9 |
46.1 |
100% |
|
|
3,410 |
|
17.8 |
20.1 |
100% |
|
|
1,835 |
|
Timber services and other |
|
|
|
130 |
|
|
|
|
|
141 |
|
Sales |
|
|
|
$ |
3,540 |
|
|
|
|
$ |
1,976 |
|
Adjusted EBITDA |
|
|
|
$ |
424 |
|
|
|
|
$ |
117 |
|
Adjusted EBITDA margin |
|
|
|
12% |
|
|
|
|
|
6% |
|
|
Six Months Ended June 26, 2021 |
|
Six Months Ended June 27, 2020 |
|
|
Harvest (000s
m3) |
Sales (000s
m3) |
Sales Mix |
|
Results ($000s) |
|
Harvest (000s m3) |
Sales (000s m3) |
Sales Mix |
|
Results ($000s) |
|
Softwood |
103.6 |
103.5 |
71% |
|
$ |
7,573 |
|
102.4 |
102.4 |
73% |
|
$ |
8,065 |
|
Hardwood |
36.9 |
41.8 |
29% |
|
|
3,305 |
|
37.7 |
38.2 |
27% |
|
|
3,360 |
|
Biomass |
0.6 |
0.6 |
0% |
|
|
8 |
|
0.2 |
0.2 |
0% |
|
|
2 |
|
|
141.1 |
145.9 |
100% |
|
|
10,886 |
|
140.3 |
140.8 |
100% |
|
|
11,427 |
|
Timber services and other |
|
|
|
225 |
|
|
|
|
|
260 |
|
Sales |
|
|
|
$ |
11,111 |
|
|
|
|
$ |
11,687 |
|
Adjusted EBITDA |
|
|
|
$ |
2,452 |
|
|
|
|
$ |
3,166 |
|
Adjusted EBITDA margin |
|
|
|
22% |
|
|
|
|
|
27% |
|
Sales for Maine Timberlands during the second
quarter totaled $3.5 million, compared to $2.0 million for the same
period last year. Sales volume, excluding biomass, increased by
129% as a result of favourable operating conditions and stable
demand.
The weighted average selling price, excluding
biomass, in Canadian dollar terms was $74.26 per m3, compared to
$91.45 per m3 in 2020. In U.S. dollar terms, the weighted average
selling price, excluding biomass, was $60.38 per m3, compared to
$65.16 per m3 in 2020 with higher sawlog prices offset by lower
hardwood pulpwood prices. The 19% price decrease in Canadian dollar
terms is mainly due to changes in the foreign exchange rate
compared to the prior year period.
Operating costs and expenses for the second
quarter were $3.1 million, compared to $1.9 million during the same
period in 2020 as a result of higher sales volumes. Weighted
average variable costs, excluding biomass, decreased 17%,
benefiting from a stronger Canadian dollar and lower softwood
sawlogs costs related to a higher proportion of roadside sales.
Adjusted EBITDA for the quarter was $0.4 million
compared to $0.1 million during the prior year period and Adjusted
EBITDA margin was 12% compared to 6% in the prior year period.
Adjusted EBITDA was impacted by higher volumes partially offset by
the stronger Canadian dollar.
During the first half of 2021, Maine
Timberlands’ sales were $11.1 million compared to $11.7 million in
the prior year period. Maine Timberlands’ weighted average selling
price, excluding biomass, decreased 8% in Canadian dollar terms,
and 1% in U.S. dollar terms, however the sales volume, excluding
biomass, increased 3% year-over-year. Operating costs and expenses
of $8.8 million during the first half of 2021 were flat
year-over-year. Adjusted EBITDA was $2.5 million compared to $3.2
million during the first half of 2020 while Adjusted EBITDA margin
was 22% compared to 27% in 2020.
There were no recordable safety incidents
amongst employees or contractors during the second quarter of
2021.
Carbon Credit Project
Over the past 18 months, Acadian has explored
opportunities to participate in both compliance and voluntary
carbon credit markets. During the quarter, Acadian executed its
first carbon development and marketing agreement to develop
voluntary carbon credits on the portion of its Maine Timberlands
that is subject to a working forest conservation easement. This
project commits Acadian to balancing harvest and growth, and
requires long term planning, annual reporting, periodic carbon
inventory verification, and maintenance of the existing sustainable
forestry certification.
While this project is relatively small, and
expected to contribute modestly to cash flow and have little impact
on operations, it forms a foundation for further carbon credit
development. As it takes about 12-18 months to develop and sell
carbon credits, Acadian expects to begin receiving proceeds from
sales in mid to late 2022.
Market Outlook
The following contains forward-looking
information about Acadian Timber Corp.’s market outlook for the
remainder of fiscal 2021. Reference should be made to the section
entitled “Cautionary Statement Regarding Forward-Looking
Information and Statements” section of this news release. For a
description of material factors that could cause actual results to
differ materially from the forward-looking statements in the
following, please see the Risk Factors section of our Management’s
Discussion and Analysis of Acadian’s most recent Annual Report and
Annual Information Form available on our website at
www.acadiantimber.com or filed with SEDAR at www.sedar.com.
Acadian expects continued steady demand for its
softwood and hardwood sawlogs, hardwood pulpwood, and biomass.
While North American softwood lumber prices are
moderating as supply and demand come into balance, demand for
softwood lumber is expected to remain strong given the continued
positive outlook for U.S. home construction and improvements,
supported by low interest rates, income and job growth, aging and
underbuilt housing stock, and favorable home buying demographics.
Consensus forecast for U.S. housing starts is 1.55 million for 2021
and 1.52 million for 2022.
Accordingly, softwood sawmills are running
steady in our operating regions, and Acadian is continuing to
experience steady demand for its softwood sawlogs.
Demand for hardwood sawlogs has been strong as
both appearance and industrial grade lumber is in high demand and
roundwood inventories at hardwood sawmills are low. Acadian expects
strong demand and pricing for its hardwood sawlogs for the
remainder of this year.
Regional hardwood pulpwood demand is expected to
remain stable as the economy improves, while softwood pulpwood
demand is expected to remain weak with continued high roundwood
inventories regionally and significant competition from sawmill
residuals that limit prospects for near term
improvement.
Demand for biomass from Acadian’s New Brunswick
operation is expected to remain stable to positive, with steady
demand from the regional market supplemented by the return of
export markets.
Appointment of Director
Concurrent with his appointment to President and
Chief Executive Officer, Adam Sheparski has been appointed to the
Board of Directors.
Quarterly Dividend
Acadian is pleased to announce a dividend of
$0.29 per share, payable on October 15, 2021 to shareholders of
record on September 30, 2021.
Acadian Timber Corp.
(“Acadian”, the “Company” or “we”) is one of the largest timberland
owners in Eastern Canada and the Northeastern U.S. and has a total
of approximately 2.4 million acres of land under management.
Acadian owns and manages approximately 761,000 acres of freehold
timberlands in New Brunswick (“New Brunswick Timberlands” or “NB
Timberlands”), approximately 300,000 acres of freehold timberlands
in Maine (“Maine Timberlands”) and provides timber services
relating to approximately 1.3 million acres of Crown licensed
timberlands in New Brunswick. Acadian’s products include softwood
and hardwood sawlogs, pulpwood and biomass by-products, sold to
approximately 90 regional customers.
Acadian’s business strategy is to maximize cash
flows from its existing timberland assets through sustainable
forest management and other land use activities while growing its
business by acquiring assets on a value basis and actively managing
these assets to drive improved performance.
Acadian’s shares are listed for trading on the
Toronto Stock Exchange under the symbol ADN.
For further information, please visit our
website at www.acadiantimber.com or contact:
Adam SheparskiChief Financial OfficerTel:
506-737-2345 Email: ir@acadiantimber.com
Cautionary Statement Regarding
Forward-Looking Information and Statements
This News Release contains forward-looking
information and statements within the meaning of applicable
Canadian securities laws that involve known and unknown risks,
uncertainties and other factors that may cause the actual results,
performance or achievements of Acadian Timber Corp. and its
subsidiaries (collectively, “Acadian”), or industry results, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. When used in this News Release, such forward-looking
statements may contain such words as “may,” “will,” “intend,”
“should,” “suggest,” “expect,” “believe,” “outlook,” “forecast,”
“predict,” “remain,” “anticipate,” “estimate,” “potential,”
“continue,” “plan,” “could,” “might,” “project,” “targeting” or the
negative of these terms or other similar terminology.
Forward-looking information is included in this News Release and
includes statements made in this News Release in sections entitled
“Dividend Policy of the Company,” “Liquidity and Capital
Resources,” and “Market Outlook” and without limitation other
statements regarding management’s beliefs, intentions, results,
performance, goals, achievements, future events, plans and
objectives, business strategy, growth strategy and prospects,
access to capital, liquidity and trading volumes, dividends, taxes,
capital expenditures, projected costs, market trends and similar
statements concerning anticipated future events, results,
achievements, circumstances, performance or expectations that are
not historical facts. These statements, which reflect management’s
current expectations regarding future events and operating
performance, are based on information currently available to
management and speak only as of the date of this News Release. All
forward-looking statements in this News Release are qualified by
these cautionary statements. Forward-looking statements involve
significant risks and uncertainties, should not be read as
guarantees of future performance or results, should not be unduly
relied upon, and will not necessarily be accurate indications of
whether or not such results will be achieved. Factors that could
cause actual results to differ materially from the results
discussed in the forward-looking statements include, but are not
limited to: general economic and market conditions; changes in U.S.
housing starts; product demand; concentration of customers;
commodity pricing; interest rate and foreign currency fluctuations;
seasonality; weather and natural conditions; regulatory, trade or
environmental policy changes; changes in Canadian or U.S. income
tax law; the economic situation of key customers; disease outbreak;
Acadian’s ability to source and secure potential investment
opportunities; the availability of potential acquisitions that suit
Acadian’s growth profile; and other risks and factors discussed
under the heading “Risk Factors” in the Annual Report dated
February 10, 2021, the Annual Information Form dated March 26,
2021,and other filings of Acadian made with securities regulatory
authorities, which are available on SEDAR at www.sedar.com.
Forward-looking information is based on various material factors or
assumptions, which are based on information currently available to
Acadian. Material factors or assumptions that were applied in
drawing a conclusion or making an estimate set out in the
forward-looking information may include, but are not limited to:
forecasts in the housing market; anticipated financial performance;
anticipated market conditions; business prospects; the economic
situation of key customers; strategies; regulatory developments;
exchange rates; the sufficiency of budgeted capital expenditures in
carrying out planned activities; the availability and cost of
labour and services; and the ability to obtain financing on
acceptable terms. Readers are cautioned that the preceding list of
material factors or assumptions is not exhaustive. Although the
forward-looking statements contained in this News Release are based
upon what management believes are reasonable assumptions, Acadian
cannot assure readers that actual results will be consistent with
these forward-looking statements. The forward-looking statements in
this News Release are made as of the date of this News Release and
should not be relied upon as representing Acadian’s views as of any
date subsequent to the date of this News Release. Acadian assumes
no obligation to update or revise these forward-looking statements
to reflect new information, events, circumstances or otherwise,
except as may be required by applicable law.
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Net Income(unaudited)
|
|
Three Months Ended |
Six Months Ended |
(CAD thousands, except per share data) |
|
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
Sales |
|
$ |
18,414 |
|
$ |
11,458 |
|
$ |
44,306 |
|
$ |
42,866 |
|
Operating costs and expenses |
|
|
|
|
|
Cost of sales |
|
|
12,269 |
|
|
7,768 |
|
|
29,716 |
|
|
28,629 |
|
Selling, administration and other |
|
|
2,058 |
|
|
2,086 |
|
|
3,698 |
|
|
4,303 |
|
Silviculture |
|
|
260 |
|
|
250 |
|
|
263 |
|
|
251 |
|
Depreciation and amortization |
|
|
64 |
|
|
71 |
|
|
126 |
|
|
137 |
|
|
|
|
14,651 |
|
|
10,175 |
|
|
33,803 |
|
|
33,320 |
|
Operating earnings |
|
|
3,763 |
|
|
1,283 |
|
|
10,503 |
|
|
9,546 |
|
Interest expense, net |
|
|
(727 |
) |
|
(1,172 |
) |
|
(1,482 |
) |
|
(2,463 |
) |
Other items |
|
|
|
|
|
Fair value adjustments and other |
|
|
2,055 |
|
|
4,237 |
|
|
2,480 |
|
|
3,218 |
|
Unrealized exchange gain / (loss) on long-term debt |
|
2,288 |
|
|
3,030 |
|
|
3,504 |
|
|
(5,180 |
) |
Gain on sale of timberlands |
|
— |
|
|
— |
|
|
72 |
|
|
— |
|
Earnings before income taxes |
|
|
7,379 |
|
|
7,378 |
|
|
15,077 |
|
|
5,121 |
|
Current income tax expense |
|
|
(179 |
) |
|
(656 |
) |
|
(1,285 |
) |
|
(1,558 |
) |
Deferred income tax expense |
|
|
(1,302 |
) |
|
(1,493 |
) |
|
(2,070 |
) |
|
(2,045 |
) |
Net income |
|
$ |
5,898 |
|
$ |
5,229 |
|
$ |
11,722 |
|
$ |
1,518 |
|
Net income per share – basic and diluted |
|
$ |
0.35 |
|
$ |
0.31 |
|
$ |
0.70 |
|
$ |
0.09 |
|
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Comprehensive Income(unaudited)
|
Three Months Ended |
Six Months Ended |
(CAD thousands) |
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
Net income |
$ |
5,898 |
|
$ |
5,229 |
|
$ |
11,722 |
|
$ |
1,518 |
Other comprehensive (loss) / income |
|
|
|
|
Items that may be reclassified subsequently to net income: |
|
|
|
|
Unrealized foreign currency translation (loss) / gain |
|
(3,185 |
) |
|
(4,169 |
) |
|
(4,618 |
) |
|
7,455 |
Comprehensive income |
$ |
2,713 |
|
$ |
1,060 |
|
$ |
7,104 |
|
$ |
8,973 |
Acadian Timber
Corp.Interim Condensed Consolidated Balance
Sheets(unaudited)
As at(CAD thousands) |
|
June 26, 2021 |
December 31, 2020 |
Assets |
|
|
|
Current assets |
|
|
|
Cash |
|
$ |
7,853 |
$ |
10,258 |
Accounts receivable and other assets |
|
|
6,744 |
|
7,731 |
Current income taxes receivable |
|
|
— |
|
415 |
Inventory |
|
|
614 |
|
957 |
|
|
|
15,211 |
|
19,361 |
Timber |
|
|
386,375 |
|
388,005 |
Land, roads, and other fixed assets |
|
|
98,286 |
|
99,892 |
Intangible asset |
|
|
6,140 |
|
6,140 |
Total assets |
|
$ |
506,012 |
$ |
513,398 |
Liabilities and shareholders’ equity |
|
|
|
Current liabilities |
|
|
|
Accounts payable and accrued liabilities |
|
$ |
6,237 |
$ |
8,640 |
Current income taxes payable |
|
|
338 |
|
— |
Dividends payable to shareholders |
|
|
4,839 |
|
4,839 |
|
|
|
11,414 |
|
13,479 |
Long-term debt |
|
|
97,755 |
|
101,185 |
Deferred income tax liabilities |
|
|
106,176 |
|
105,493 |
Shareholders’ equity |
|
|
290,667 |
|
293,241 |
Total liabilities and shareholders’ equity |
|
$ |
506,012 |
$ |
513,398 |
Acadian Timber
Corp.Interim Condensed Consolidated Statements of
Cash Flows(unaudited)
|
Three Months Ended |
Six Months Ended |
(CAD thousands) |
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
Cash provided by (used for): |
|
|
|
|
Operating activities |
|
|
|
|
Net income |
$ |
5,898 |
|
$ |
5,229 |
|
$ |
11,722 |
|
$ |
1,518 |
|
Adjustments to net income: |
|
|
|
|
Income tax expense |
|
1,481 |
|
|
2,149 |
|
|
3,355 |
|
|
3,603 |
|
Depreciation and amortization |
|
64 |
|
|
71 |
|
|
126 |
|
|
137 |
|
Fair value adjustments and other |
|
(2,055 |
) |
|
(4,237 |
) |
|
(2,480 |
) |
|
(3,218 |
) |
Unrealized exchange (gain) / loss on long-term debt |
|
(2,288 |
) |
|
(3,030 |
) |
|
(3,504 |
) |
|
5,180 |
|
Gain on sale of timberlands |
|
— |
|
|
— |
|
|
(72 |
) |
|
— |
|
Income taxes paid |
|
(2,118 |
) |
|
— |
|
|
(532 |
) |
|
— |
|
Net change in non-cash working capital balances and other |
|
596 |
|
|
3,664 |
|
|
(1,260 |
) |
|
3,358 |
|
|
|
1,578 |
|
|
3,846 |
|
|
7,355 |
|
|
10,578 |
|
Financing activities |
|
|
|
|
Repayment of short-term debt |
|
— |
|
|
(1,156 |
) |
|
— |
|
|
(8,169 |
) |
Issuance of long-term debt |
|
— |
|
|
— |
|
|
— |
|
|
19,795 |
|
Repayment of long-term debt |
|
— |
|
|
— |
|
|
— |
|
|
(9,729 |
) |
Deferred financing costs |
|
— |
|
|
(17 |
) |
|
— |
|
|
(527 |
) |
Dividends paid to shareholders |
|
(4,839 |
) |
|
(4,839 |
) |
|
(9,678 |
) |
|
(9,678 |
) |
|
|
(4,839 |
) |
|
(6,012 |
) |
|
(9,678 |
) |
|
(8,308 |
) |
Investing activities |
|
|
|
|
Additions to timber, land, roads, and other fixed assets |
|
(88 |
) |
|
(87 |
) |
|
(157 |
) |
|
(95 |
) |
Proceeds from sale of timberlands |
|
— |
|
|
— |
|
|
75 |
|
|
— |
|
|
|
(88 |
) |
|
(87 |
) |
|
(82 |
) |
|
(95 |
) |
(Decrease) increase in cash during the period |
|
(3,349 |
) |
|
(2,253 |
) |
|
(2,405 |
) |
|
2,175 |
|
Cash, beginning of period |
|
11,202 |
|
|
12,029 |
|
|
10,258 |
|
|
7,601 |
|
Cash, end of period |
$ |
7,853 |
|
$ |
9,776 |
|
$ |
7,853 |
|
|
9,776 |
|
Acadian Timber
Corp.Reconciliations to Adjusted EBITDA and Free
Cash Flow
|
Three Months Ended |
Six Months Ended |
(CAD thousands) |
June 26, 2021 |
June 27, 2020 |
June 26, 2021 |
June 27, 2020 |
Net income |
$ |
5,898 |
|
$ |
5,229 |
|
$ |
11,722 |
|
$ |
1,518 |
|
Add (deduct): |
|
|
|
|
Interest expense, net |
|
727 |
|
|
1,172 |
|
|
1,482 |
|
|
2,463 |
|
Current income tax expense |
|
179 |
|
|
656 |
|
|
1,285 |
|
|
1,558 |
|
Deferred income tax expense |
|
1,302 |
|
|
1,493 |
|
|
2,070 |
|
|
2,045 |
|
Depreciation and amortization |
|
64 |
|
|
71 |
|
|
126 |
|
|
137 |
|
Fair value adjustments and other |
|
(2,055 |
) |
|
(4,237 |
) |
|
(2,480 |
) |
|
(3,218 |
) |
Unrealized exchange (gain) / loss on long-term debt |
|
(2,288 |
) |
|
(3,030 |
) |
|
(3,504 |
) |
|
5,180 |
|
Adjusted EBITDA |
$ |
3,827 |
|
$ |
1,354 |
|
$ |
10,701 |
|
$ |
9,683 |
|
Add (deduct): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest paid on debt, net |
|
(696 |
) |
|
(819 |
) |
|
(1,408 |
) |
|
(1,673 |
) |
Additions to timber, land, roads, and other fixed assets |
|
(88 |
) |
|
(87 |
) |
|
(157 |
) |
|
(95 |
) |
Gain on sale of timberlands |
|
— |
|
|
— |
|
|
(72 |
) |
|
— |
|
Proceeds from sale of timberlands |
|
— |
|
|
— |
|
|
75 |
|
|
— |
|
Current income tax expense |
|
(179 |
) |
|
(656 |
) |
|
(1,285 |
) |
|
(1,558 |
) |
Free Cash Flow |
$ |
2,864 |
|
$ |
(208 |
) |
$ |
7,854 |
|
$ |
6,357 |
|
Dividends declared |
$ |
4,839 |
|
$ |
4,839 |
|
$ |
9,678 |
|
$ |
9,678 |
|
Payout Ratio |
|
n/a |
|
|
n/a |
|
|
123 |
% |
|
152 |
% |
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