CAMBRIDGE, ON,
Nov. 7, 2012 /CNW/ - ATS Automation
Tooling Systems Inc. (TSX: ATA) ("ATS" or the "Company")
today reported financial results for the three and six months ended
September 30, 2012 for its continuing
operations (Automation Systems Group or "ASG") and discontinued
operations ("Solar").
Second Quarter Summary
- Revenues from continuing operations were $141.4 million, 3% lower than the corresponding
period a year ago primarily because certain transportation programs
(representing approximately 10% of Order Backlog) were put on hold
by the customers due to product and specification revisions. The
programs have since been re-started;
- Despite the decline in revenues, earnings from continuing
operations for the second quarter of fiscal 2012 increased 4% to
$13.8 million (10% operating margin)
compared to $13.3 million (9%
operating margin) in the corresponding period a year ago;
- EBITDA increased 3% to $16.7
million (12% EBITDA margin) from $16.2 million (11% EBITDA margin) in the
corresponding period a year ago;
- Order Bookings decreased 32% to $112
million from $165 million in
the second quarter of fiscal 2012, reflecting customer delays in
the transportation market, and lower activity in energy, consumer
products & electronics. Period end Order Backlog was
$361 million, similar to $363 million a year ago;
- Included in Order Bookings is an initial deposit of
$12 million on an approximately
65 million Euro contract awarded to
ATS to provide turnkey automation to a large, life sciences project
in Nigeria, for which ATS is the
prime equipment contractor. The balance of the contract will be
recorded in Order Bookings at financial close. See "ASG Order
Bookings"
- The Company's balance sheet was strong with cash net of debt of
$102.5 million. Subsequent to the end
of the second quarter, the Company established a new $250 million credit facility, which provides
improved terms and flexibility over the previous credit facility;
and
- Subsequent to the second quarter, the Company signed a
definitive agreement to sell four ground-mount solar projects,
representing approximately 34 megawatts ("MWs"). Net proceeds to
the Company are expected to be approximately $20 million. See "Second Quarter Summary of
Discontinued Operations: Solar".
Financial Results
In millions of Canadian
dollars,
except per share data |
|
|
3 months
ended
September 30,
2012 |
|
|
3 months
ended
October 2,
2011 |
|
|
6 months
ended
September 30,
2012 |
|
|
6 months
ended
October 2,
2011 |
| Revenues |
Continuing
Operations |
|
$ |
141.4 |
|
$ |
145.9 |
|
$ |
293.7 |
|
$ |
272.8 |
| Discontinued
Operations |
|
$ |
0.6 |
|
$ |
33.9 |
|
$ |
1.2 |
|
$ |
96.7 |
| Earnings from
Operations1 |
Continuing Operations |
|
$ |
13.8 |
|
$ |
13.3 |
|
$ |
29.0 |
|
$ |
23.8 |
| EBITDA1 |
Continuing Operations |
|
$ |
16.7 |
|
$ |
16.2 |
|
$ |
34.8 |
|
$ |
29.8 |
| Net income (loss) |
Continuing Operations |
|
$ |
9.7 |
|
$ |
9.3 |
|
$ |
21.5 |
|
$ |
15.5 |
|
Discontinued Operations |
|
$ |
(1.8) |
|
$ |
(76.4) |
|
$ |
(3.8) |
|
$ |
(87.6) |
| Earnings per share |
From
continuing operations
(basic & diluted) |
|
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.24 |
|
$ |
0.18 |
From
discontinued operations
(basic & diluted) |
|
$ |
(0.02) |
|
$ |
(0.87) |
|
$ |
(0.04) |
|
$ |
(1.00) |
1 Non-IFRS measures
"Second quarter performance reflected our solid
financial and operating platform, which allowed us to operate
profitably and generate cash despite some challenges," said
Anthony Caputo, Chief Executive
Officer. "We have made a number of important strategic
advancements, including the award of our first large
Enterprise-type program for automation equipment, the establishment
of a new, larger more flexible $250
million credit facility and the sale of a number of our
Ontario solar assets. These are
important milestones as we move forward with the next phase of our
strategy; grow, expand and scale."
Second Quarter Summary Continuing
Operations
By industrial market, revenues from life sciences increased 20%
year over year due to higher Order Backlog entering the second
quarter compared to a year ago. Consumer products &
electronics revenues declined 9% year over year due to lower Order
Bookings. Energy market revenues decreased 59% on lower Order
Backlog entering the second quarter compared to a year ago,
reflecting reduced activity primarily in the solar market. Despite
increased Order Backlog entering the second quarter compared to a
year ago, transportation revenues declined 3% due to customer
delays on certain programs.
Foreign exchange rate changes negatively
impacted the translation of revenues earned by foreign-based ASG
subsidiaries by approximately $3.6
million compared to the second quarter of fiscal 2012,
primarily reflecting the strengthening of the Canadian dollar
relative to the Euro.
Fiscal 2013 second quarter earnings from
operations were $13.8 million (10%
operating margin) compared to earnings from operations of
$13.3 million (9% operating margin)
in the second quarter of fiscal 2012. Growth in earnings from
operations primarily reflected improved program management and
improvements made in supply chain management to reduce
third-party costs. The increase in earnings from
operations was partially offset by lower revenues earned during the
period.
ASG Order Bookings
Second quarter fiscal 2013 Order Bookings were $112 million, 32% lower than a year ago
reflecting customer delays in the transportation market, and lower
activity in energy, consumer products & electronics.
Included in second quarter Order Bookings is an
initial down payment of $12 million
in relation to an approximately 65 million
Euro contract awarded to ATS for the turnkey supply of
equipment and automation to produce medical devices in a new
production facility in Nigeria.
ATS is the prime contractor on the project which involves
five ATS divisions and six major
subcontractors in Germany,
Switzerland and Austria. The balance of the agreement with ATS
is subject to a number of conditions. In particular, the agreement
is conditional on ATS satisfying itself with respect to certain
technical and product information and with respect to certain
commercial matters, including finalization of project financing and
export credit guarantees relating to the customer's project, which
are expected to be provided by German and Austrian banks and export
credit agencies. The program is currently expected to begin late in
the third quarter of fiscal 2013 with financial close expected in
the first quarter of fiscal 2014. The majority of activity on the
program is expected to occur subsequent to financial close, with
most of the project delivered in fiscal 2014. The program is being
undertaken with the sponsorship and collaboration of the Rivers
State Government, Nigeria. The
Company will record the balance of the Order Booking and Order
Backlog when financial close is reached.
Second Quarter Summary of Discontinued
Operations: Solar
Solar results for the first and second quarters of fiscal 2013
included those of Ontario Solar only as a result of the
de-consolidation of Photowatt International S.A.S. ("PWF") during
fiscal 2012.
Ontario Solar generated revenues of $0.6 million in the second quarter of fiscal 2013
due to decreased market activity resulting primarily from
regulatory delays in project approvals. Ontario Solar recorded a
$1.8 million loss on
lower-than-planned revenues combined with higher fixed costs.
Regarding Ontario Solar, subsequent to the end
of the second quarter, Ontario Solar's 50% owned joint venture,
Ontario Solar PV Fields ("OSPV") signed a definitive agreement to
sell four ground-mount solar projects, representing approximately
34 MWs. The transaction is subject to a number of approvals and
conditions, including the purchaser securing financing for the
projects. The Company expects the transaction to close in
early calendar 2013. OSPV will retain 25% ownership of the projects
until the projects reach commercial operation, which is expected to
happen in the second half of calendar 2013. Net proceeds to the
Company are expected to be approximately $20
million, which is expected to be paid out through calendar
2013, based on the projects achieving certain development
milestones.
The Company intends to complete the separation
of Solar via the divestment of the remaining projects owned by OSPV
and the Ontario Solar
manufacturing operations. The value to be derived from the sale of
the remaining solar assets is unknown. The Company is
continuing to work with interested parties to conclude
agreements.
Quarterly Conference Call
ATS's quarterly conference call begins at 10
am eastern on Wednesday November
7 and can be accessed live at www.atsautomation.com or on
the phone by dialing 416 644 3416 five minutes prior.
About ATS
ATS Automation provides innovative, custom designed, built and
installed manufacturing solutions to many of the world's most
successful companies. Founded in 1978, ATS uses its
industry-leading knowledge and global capabilities to serve the
sophisticated automation systems' needs of multinational customers
in industries such as consumer products & electronics, energy,
life sciences and transportation. It also leverages its many years
of experience and skills to fulfill the specialized automation
product manufacturing requirements of customers. Through its
Ontario solar business, ATS
participates in the solar energy industry. ATS employs
approximately 2,400 people at 20 manufacturing facilities in
Canada, the United States, Europe, Southeast
Asia and China. The
Company's shares are traded on the Toronto Stock Exchange under the
symbol ATA. Visit the Company's website at
www.atsautomation.com.
Management's Discussion and Analysis
For the Quarter Ended September 30,
2012
This Management's Discussion and Analysis
("MD&A") for the three and six months ended September 30, 2012 (second quarter of fiscal
2013) is as of November 6, 2012 and
provides information on the operating activities, performance and
financial position of ATS Automation Tooling Systems Inc. ("ATS" or
the "Company") and should be read in conjunction with the unaudited
interim consolidated financial statements of the Company for the
second quarter of fiscal 2013 which have been prepared in
accordance with International Financial Reporting Standards
("IFRS") and are reported in Canadian dollars. The Company assumes
that the reader of this MD&A has access to, and has read the
audited consolidated financial statements prepared in accordance
with IFRS and MD&A of the Company for the year ended
March 31, 2012 (fiscal 2012) and,
accordingly, the purpose of this document is to provide a second
quarter update to the information contained in the fiscal 2012
MD&A. Additional information is contained in the Company's
filings with Canadian securities regulators, including its Annual
Information Form, found on SEDAR at www.sedar.com and on the
Company's website at www.atsautomation.com.
Notice to Reader: Non-IFRS Measures
Throughout this document the term "operating earnings" is used to
denote earnings (loss) from operations. EBITDA is also used and is
defined as earnings (loss) from operations excluding depreciation
and amortization (which includes amortization of intangible
assets). The term "margin" refers to an amount as a percentage of
revenue. The terms "earnings (loss) from operations", "operating
earnings", "margin", "operating loss", "operating results",
"operating margin", "EBITDA", "Order Bookings" and "Order Backlog"
do not have any standardized meaning prescribed within IFRS and
therefore may not be comparable to similar measures presented by
other companies. Operating earnings and EBITDA are some of the
measures the Company uses to evaluate the performance of its
segments. Management believes that ATS shareholders and potential
investors in ATS use non-IFRS financial measures such as operating
earnings and EBITDA in making investment decisions and measuring
operational results. A reconciliation of operating earnings and
EBITDA to net income from continuing operations for the three and
six month periods ending September 30,
2012 and October 2, 2011 is
contained in this MD&A (see "Reconciliation of EBITDA to IFRS
Measures"). EBITDA should not be construed as a substitute for net
income determined in accordance with IFRS.
Order Bookings represent new orders for the
supply of automation systems that management believes are firm.
Order Backlog is the estimated unearned portion of revenue on
customer contracts that are in process and have not been completed
at the specified date. A reconciliation of Order Bookings and
Order Backlog to total Company revenues for the three and six month
periods ending September 30, 2012 and
October 2, 2011 is contained in the
MD&A (see "ASG Order Backlog Continuity").
COMPANY PROFILE
The Company operates in two segments: Automation Systems Group
("ASG"), the Company's continuing operations, and Solar, which is
classified as discontinued operations. Through ASG, ATS provides
innovative, custom designed, built and installed manufacturing
solutions to many of the world's most successful companies. Founded
in 1978, ATS uses its industry-leading knowledge and global
capabilities to serve the sophisticated automation systems' needs
of multinational customers in industries such as consumer products
& electronics, energy, life sciences, and transportation. ATS
also leverages its many years of experience and skills to fulfill
the specialized automation product manufacturing requirements of
customers. Through its Ontario
solar business, ATS participates in the solar energy industry. ATS
employs approximately 2,400 people at 20 manufacturing facilities
in Canada, the United States, Europe, Southeast
Asia and China.
Value Creation Strategy
The Company has made significant progress in each phase of its
Value Creation Strategy, including the separation of solar assets
(see "Discontinued Operations: Solar Separation and Outlook").
Accordingly, in June
2012, the ATS Board of Directors endorsed the Company's
vision and mission statements, and approved the next phase of the
Company's strategy: Grow, Expand and Scale. This strategy is
designed to leverage the strong foundation of ATS's core automation
business, continue the growth and development of ATS and create
value for all stakeholders.
Vision
Deliver enabling manufacturing solutions to the world's market
leaders.
Mission
We will achieve our mission by providing:
- Outstanding value to our customers;
- Superior financial returns to our shareholders; and
- A premier work environment.
Grow
To further the Company's organic growth, ASG will continue to
target providing comprehensive, value-based programs and enterprise
solutions for customers built on differentiating technological
solutions, value of customer outcomes achieved and global
capability.
Expand
The Company seeks to expand its offering of products and services
to the market. The Company intends to build on its automation
systems business to offer: engineering, including design, modelling
and simulation, and program management; products, including
contract manufacturing, automation and other manufacturing
products; and services, including pre automation, post automation,
training, life cycle material management, and other services.
Although engineering, products and services are part of ATS's
portfolio today, the Company has significant room to grow these
offerings in the future.
Scale
The Company is also committed to growth through acquisition, and
has an organizational structure, business processes and the
experience to successfully integrate acquired companies.
Acquisition opportunities are targeted and evaluated on their
ability to bring ATS market or technology leadership, scale and/or
an opportunity brought on by a weak economic environment. For each
of ASG's markets, the Company has analyzed the capability value
chain and made a grow, team or acquire decision. Financially,
targets are reviewed on a number of criteria including their
potential to add accretive earnings to current operations.
OVERVIEW - OPERATING RESULTS FROM CONTINUING
OPERATIONS
Results from continuing operations comprise those of ASG and
corporate costs not directly attributable to Solar. The results of
the Solar segment are reported as discontinued operations.
Effective from Q1 of fiscal 2013, the Company
changed the presentation of its revenues by industrial market to
align with the organization of its sales and marketing group.
Computer electronics has been combined with consumer products
(formerly known as "Other"). Comparative revenue figures in this
MD&A have been restated to reflect this change in
presentation.
Consolidated Revenues from Continuing Operations
(In millions of dollars)
|
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| Revenues by market |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Consumer products & electronics |
|
$ |
13.2 |
|
$ |
14.5 |
|
$ |
32.6 |
|
$ |
31.4 |
| |
Energy |
|
|
7.5 |
|
|
18.4 |
|
|
19.2 |
|
|
43.4 |
| |
Life sciences |
|
|
58.0 |
|
|
48.3 |
|
|
110.7 |
|
|
92.8 |
| |
Transportation |
|
|
62.7 |
|
|
64.7 |
|
|
131.2 |
|
|
105.2 |
| Total revenues from
continuing operations |
|
$ |
141.4 |
|
$ |
145.9 |
|
$ |
293.7 |
|
$ |
272.8 |
Second Quarter
Second quarter revenues were 3% lower than in the corresponding
period a year ago primarily because certain transportation programs
(representing approximately 10% of Order Backlog) were put on hold
by the customers due to product and specification revisions. The
programs have since been restarted. Lower Order Bookings in
the second quarter of fiscal 2013 also contributed to lower
revenues in the period. Year over year foreign exchange rate
changes negatively impacted the translation of revenues earned by
foreign-based ASG subsidiaries by approximately $3.6 million compared to the second quarter of
fiscal 2012, primarily reflecting the strengthening of the Canadian
dollar relative to the Euro.
By industrial market, revenues from life
sciences increased 20% year over year due to higher Order Backlog
entering the second quarter compared to a year ago. Consumer
products & electronics revenues declined 9% year over year due
to lower Order Bookings. Energy market revenues decreased 59% on
lower Order Backlog entering the second quarter compared to a year
ago, reflecting reduced activity primarily in the solar market.
Despite increased Order Backlog entering the second quarter
compared to a year ago, transportation revenues declined 3% due to
the reasons noted above.
Year-to-date
Revenues for the six months ended September
30, 2012 were 8% higher than the corresponding period a year
ago primarily as a result of increased Order Backlog entering the
fiscal year compared to a year ago.
By industrial market, year-to-date revenues from
consumer products & electronics, life sciences and
transportation markets increased 4%, 19% and 25% respectively
compared to the same period a year ago, primarily on increased
Order Backlog entering the fiscal year compared to a year ago.
Revenues in energy decreased 56% compared to the same period a year
ago, primarily due to weakness in the solar market.
Foreign exchange rate changes negatively
impacted the translation of revenues earned by foreign-based ASG
subsidiaries by approximately $3.4
million compared to the first six months of fiscal 2012,
primarily reflecting the strengthening of the Canadian dollar
relative to the Euro.
Consolidated Operating Results
(In millions of dollars)
|
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Earnings from operations |
|
$ |
13.8 |
|
$ |
13.3 |
|
$ |
29.0 |
|
$ |
23.8 |
| Depreciation and amortization |
|
|
2.9 |
|
|
2.9 |
|
|
5.8 |
|
|
6.0 |
| EBITDA |
|
$ |
16.7 |
|
$ |
16.2 |
|
$ |
34.8 |
|
$ |
29.8 |
Second Quarter
Fiscal 2013 second quarter earnings from operations were
$13.8 million (10% operating margin)
compared to earnings from operations of $13.3 million (9% operating margin) in the second
quarter of fiscal 2012. Growth in earnings from operations
primarily reflected improved program management and improvements
made in supply chain management to
reduce third-party costs. The
increase in earnings from operations was partially offset by lower
revenues earned during the period. Included in fiscal 2012 second
quarter earnings from operations was a $1.0
million charge for bad debt related to a specific customer
bankruptcy protection filing.
In the second quarter of fiscal 2013 and the
second quarter of fiscal 2012, depreciation and amortization
expense was $2.9 million.
Year-to-date
For the six months ended September 30,
2012, earnings from operations were $29.0 million (10% operating margin) compared to
earnings from operations of $23.8
million (9% operating margin) in the corresponding period a
year ago. Higher earnings from operations primarily reflected
increased volumes, continued strong program management and
improvements in supply chain management. The increase in earnings
from operations was partially offset by an increase in selling,
general and administrative expenses in support of growth (see
"Consolidated Results from Continuing Operations: Selling, general
and administrative"). Included in the first six months of fiscal
2012 earnings from operations was a $1.0
million charge for bad debt related to a specific customer
bankruptcy protection filing.
Depreciation and amortization expense was
$5.8 million in the first six months
of fiscal 2013, generally consistent with the $6.0 million expensed in the same period a year
ago.
ASG Order Bookings
Second quarter fiscal 2013 Order Bookings were $112 million, 32% lower than a year ago,
reflecting customer delays in the transportation market, and lower
activity in energy, consumer products & electronics.
Included in second quarter Order Bookings is an
initial down payment of $12 million
in relation to an approximately 65 million
Euro contract awarded to ATS for the turnkey supply of
equipment and automation to produce medical devices in a new
production facility in Nigeria.
ATS is the prime contractor on the project which involves
five ATS divisions and six major
subcontractors in Germany,
Switzerland and Austria. The balance of the agreement with ATS
is subject to a number of conditions. In particular, the agreement
is conditional on ATS satisfying itself with respect to certain
technical and product information and with respect to certain
commercial matters, including finalization of project financing and
export credit guarantees relating to the customer's project, which
are expected to be provided by German and Austrian banks and export
credit agencies. The program is currently expected to begin late in
the third quarter of fiscal 2013 with financial close expected in
the first quarter of fiscal 2014. The majority of activity on the
program is expected to occur subsequent to financial close, with
most of the project delivered in fiscal 2014. The program is being
undertaken with the sponsorship and collaboration of the Rivers
State Government, Nigeria. The
Company will record the balance of the Order Booking and Order
Backlog when financial close is reached.
Quarter over quarter foreign exchange rate
changes negatively impacted the translation of Euro-denominated
Order Bookings, reflecting the strengthening of the Canadian dollar
relative to the Euro.
ASG Order Backlog Continuity
(In millions of dollars)
|
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Opening Order Backlog |
|
$ |
397 |
|
$ |
328 |
|
$ |
382 |
|
$ |
296 |
| Revenues |
|
|
(141) |
|
|
(146) |
|
|
(294) |
|
|
(273) |
| Order Bookings |
|
|
112 |
|
|
165 |
|
|
280 |
|
|
322 |
| Order Backlog adjustments1 |
|
|
(7) |
|
|
16 |
|
|
(7) |
|
|
18 |
| Total |
|
$ |
361 |
|
$ |
363 |
|
$ |
361 |
|
$ |
363 |
1 Order Backlog adjustments include foreign
exchange adjustments and cancellations.
ASG Order Backlog by Industry
(In millions of dollars)
| |
|
|
September 30,
2012 |
|
|
October 2,
2011 |
| Consumer products & electronics |
|
$ |
27 |
|
$ |
33 |
| Energy |
|
|
16 |
|
|
43 |
| Life sciences |
|
|
136 |
|
|
113 |
| Transportation |
|
|
182 |
|
|
174 |
| Total |
|
$ |
361 |
|
$ |
363 |
At September 30,
2012, ASG Order Backlog was $361
million, 1% lower than at October 2,
2011, reflecting the Company's revised approach to market
which has varied the timing of various larger opportunities through
the backlog to revenue cycle.
ASG Outlook
The general economic environment remains uncertain, particularly
with respect to the European economy due to the Eurozone sovereign
debt crisis. This has the potential to result in tighter
credit markets which could negatively impact demand, particularly
for the Company's European operations, and may cause volatility in
Order Bookings. Similarly, should economic growth in
China continue to contract or the
recovery in the U.S. economy stall, the Company's markets may be
negatively impacted. Overall, a prolonged or more significant
downturn in the economy could negatively impact Order
Bookings. Impacts on demand for the Company's products and
services may lag behind global macroeconomic trends due to the
strategic nature of the Company's programs to its customers and
long lead times on projects.
Many customers remain cautious in their approach
to capital investment and some potential Order Bookings have been
delayed, particularly in the transportation and life sciences
markets. The Company has opportunities in energy markets such as
nuclear and oil and gas; however, these may not offset the
slow-down in the solar energy market, caused by reductions in solar
feed-in-tariffs. These conditions negatively impacted both demand
for solar products and the need for additional solar manufacturing
capacity. Activity in the consumer products & electronics
market also remains soft.
The Company's sales organization will continue
to work to engage with customers on enterprise-type solutions such
as the project contemplated under the recent Nigerian order.
However, this approach to market may cause variability in Order
Bookings from quarter to quarter and, as is already the case,
lengthen the performance period and revenue recognition for certain
customer programs. Order Backlog remains strong, which will
likely partially mitigate the impact of volatile Order Bookings on
revenues in the short term.
Management expects that the implementation of
its strategic initiatives to improve business processes, leadership
and supply chain management will continue to have a positive impact
on ATS operations. Management's disciplined focus on program
management, cost reductions, standardization and quality put ATS in
a strong competitive position to capitalize on opportunities going
forward and sustain performance in difficult market conditions.
The Company is seeking to expand its position in
the global automation market organically and through acquisition.
The Company's strong financial position provides a solid foundation
to pursue organic growth and the flexibility to pursue its
acquisition growth strategy.
CONSOLIDATED RESULTS FROM CONTINUING OPERATIONS
(In millions of dollars, except per share data)
|
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| Revenues |
|
$ |
141.4 |
|
$ |
145.9 |
|
$ |
293.7 |
|
$ |
272.8 |
| Cost of revenues |
|
|
103.7 |
|
|
109.0 |
|
|
215.8 |
|
|
201.4 |
| Selling, general and administrative |
|
|
23.3 |
|
|
23.0 |
|
|
47.3 |
|
|
45.9 |
| Stock-based compensation |
|
|
0.6 |
|
|
0.6 |
|
|
1.6 |
|
|
1.7 |
| Earnings from operations |
|
$ |
13.8 |
|
$ |
13.3 |
|
$ |
29.0 |
|
$ |
23.8 |
| Net finance costs |
|
$ |
0.5 |
|
$ |
0.2 |
|
$ |
0.7 |
|
$ |
0.8 |
| Provision for income taxes |
|
|
3.6 |
|
|
3.8 |
|
|
6.8 |
|
|
7.5 |
| Net income from continuing operations |
|
$ |
9.7 |
|
$ |
9.3 |
|
$ |
21.5 |
|
$ |
15.5 |
| Loss from discontinued
operations, net of tax |
|
$ |
(1.8) |
|
$ |
(76.4) |
|
$ |
(3.8) |
|
$ |
(87.6) |
| Net income (loss) |
|
$ |
7.9 |
|
$ |
(67.1) |
|
$ |
17.7 |
|
$ |
(72.1) |
| Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic and diluted - from continuing
operations |
|
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.24 |
|
$ |
0.18 |
| Basic and diluted - from
discontinued operations |
|
$ |
(0.02) |
|
$ |
(0.87) |
|
$ |
(0.04) |
|
$ |
(1.00) |
| |
|
$ |
0.09 |
|
$ |
(0.76) |
|
$ |
0.20 |
|
$ |
(0.82) |
Revenues. At $141.4 million, consolidated revenues from
continuing operations for the second quarter of fiscal 2013 were 3%
lower than for the corresponding period a year ago. Year-to-date
revenues were $293.7 million or 8%
higher than for the same period a year ago. See "Overview -
Operating Results from Continuing Operations".
Cost of revenues. At $103.7 million, second quarter fiscal 2013 cost
of revenues decreased over the corresponding period a year ago by
$5.3 million or 5%, primarily on
lower revenues. Year-to-date cost of revenues of $215.8 million increased by $14.4 million or 7%, primarily on higher revenues
generated compared to the corresponding period.
At 27%, gross margin in the second quarter
improved from 25% in the corresponding period a year ago primarily
on continued strong program management and improvements made in
supply chain management to reduce third-party costs. Year-to-date
gross margin of 27% was consistent with the 26% gross margin in the
corresponding period a year ago.
Selling, general and administrative
("SG&A") expenses. SG&A expenses for the second quarter
of fiscal 2013 of $23.3 million were
consistent with the $23.0 million in
the corresponding period a year ago. For the six months ended
September 30, 2012, SG&A expenses
increased 3% or $1.4 million to
$47.3 million compared to the same
period a year ago, reflecting incremental spending on sales and
marketing, professional fees and increased costs relating to
mergers and acquisitions.
Stock-based compensation cost.
Stock-based compensation expense of $0.6
million in the second quarter of fiscal 2013 was consistent
with the $0.6 million expensed in the
corresponding period a year ago. For the six month period ended
September 30, 2012, stock-based
compensation expense decreased to $1.6
million from $1.7 million a
year earlier primarily reflecting lower expenses from stock option
grants offset by the revaluation of deferred stock units.
Earnings from operations. For the three
and six month periods ended September 30,
2012, consolidated earnings from operations were
$13.8 million and $29.0 million respectively (operating margins of
10% in both periods), compared to earnings from operations of
$13.3 and $23.8 million a year ago (operating margins of 9%
in both periods). See "Overview - Operating Results from Continuing
Operations".
Net finance costs. Net finance costs were
$0.5 million in the second quarter of
fiscal 2013 compared to $0.2 million
a year ago. The increase in net finance costs was mainly
attributable to the fees associated with increased letters of
credit usage. For the six months ended September 30, 2012, finance costs were
$0.7 million compared to $0.8 million in the corresponding period last
year.
Provision for income taxes. For the three
and six months ended September 30,
2012, the Company's effective income tax rates of 27% and
24%, respectively, differed from the combined Canadian basic
federal and provincial income tax rate of 27% (three and six months
ended October 2, 2011 - 29% and 33%
respectively) primarily as a result of income earned in certain
jurisdictions with lower tax rates and where utilization of
unrecognized deferred tax assets resulted in lower tax expense for
accounting purposes.
Net income from continuing operations.
Fiscal 2013 second quarter net income from continuing operations
was $9.7 million (11 cents per share basic and diluted) compared to
net income from continuing operations of $9.3 million (11
cents per share basic and diluted) for the second quarter of
fiscal 2012. Net income from continuing operations in the six
months ended September 30, 2012 was
$21.5 million (24 cents per share basic and diluted) compared to
net income from continuing operations of $15.5 million (18
cents per share basic and diluted) for the corresponding
period a year ago.
Reconciliation of EBITDA to IFRS
Measures
(In millions of dollars)
| |
|
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
| EBITDA |
|
|
$ |
16.7 |
|
$ |
16.2 |
| Less: depreciation and amortization expense |
|
|
|
2.9 |
|
|
2.9 |
| Earnings from operations |
|
|
$ |
13.8 |
|
$ |
13.3 |
| Less: net finance costs |
|
|
|
0.5 |
|
|
0.2 |
| Provision for income taxes |
|
|
|
3.6 |
|
|
3.8 |
| Net income from continuing operations |
|
|
$ |
9.7 |
|
$ |
9.3 |
| |
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| |
|
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| EBITDA |
|
|
$ |
34.8 |
|
$ |
29.8 |
| Less: depreciation and amortization expense |
|
|
|
5.8 |
|
|
6.0 |
| Earnings from operations |
|
|
$ |
29.0 |
|
$ |
23.8 |
| Less: net finance costs |
|
|
|
0.7 |
|
|
0.8 |
| Provision for income taxes |
|
|
|
6.8 |
|
|
7.5 |
| Net income from continuing operations |
|
|
$ |
21.5 |
|
$ |
15.5 |
DISCONTINUED OPERATIONS: SOLAR
(In millions of dollars)
| |
|
|
Three Months
Ended
September 30,
2012 |
|
|
Three Months
Ended
October 2,
2011 |
|
|
Six Months
Ended
September 30,
2012 |
|
|
Six Months
Ended
October 2,
2011 |
| Total revenues |
|
$ |
0.6 |
|
$ |
33.9 |
|
$ |
1.2 |
|
$ |
96.7 |
| Loss from discontinued
operations |
|
|
(1.8) |
|
|
(71.3) |
|
|
(3.8) |
|
|
(82.5) |
| Loss from
discontinued operations, net of tax |
|
|
(1.8) |
|
|
(76.4) |
|
|
(3.8) |
|
|
(87.6) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter
Revenues
Solar revenues in the second quarter of fiscal 2013 included those
of Ontario Solar only as a result of the de-consolidation of
Photowatt International S.A.S. ("Photowatt France" or "PWF") during
fiscal 2012 (see "Solar Separation and Outlook"). Fiscal 2013
second quarter revenues of $0.6
million were 98% lower than in the second quarter of fiscal
2012 reflecting the de-consolidation of PWF and decreased market
activity in Ontario Solar due primarily to regulatory delays in
project approvals.
Loss from Discontinued Operations
Ontario Solar recorded a $1.8 million
loss in the second quarter of fiscal 2013 on lower-than-planned
revenues combined with higher fixed costs. The second quarter
loss in fiscal 2012 was $71.3
million, $1.4 million of which
related to Ontario Solar and $69.9
million of which related to PWF.
Loss from Discontinued Operations, Net of
Tax
Solar's second quarter loss from operations, net of tax, was
$1.8 million compared to a loss from
operations, net of tax of $76.4
million in the corresponding period a year ago.
Year-to-Date
Revenues
Revenues for the six months ended September
30, 2012 of $1.2 million were
99% lower than in the same period of fiscal 2012 reflecting the
de-consolidation of PWF and decreased market activity in Ontario
Solar due primarily to regulatory delays in project
approvals.
Loss from Operations
Fiscal 2013 year-to-date loss from operations was $3.8 million compared to a loss from operations
of $82.5 million a year ago,
$1.9 million of which related to
Ontario Solar and $80.6 million of
which related to PWF.
Loss from Operations, Net of
Tax
Fiscal 2013 year-to-date loss from operations net of tax was
$3.8 million compared to a loss from
operations, net of tax, of $87.6
million in the corresponding period a year ago.
Included in fiscal 2012 loss from operations net of tax were an
operating loss of $82.5 million, net
finance charges of $0.6 million, and
income tax expenses of $4.5 million,
which include the write-off of deferred tax assets of $4.4 million.
Solar Separation and Outlook
During the year ended March 31, 2011,
the Company's Board of Directors approved a plan designed to
implement the separation of Solar from ATS.
Regarding Ontario Solar, subsequent to the end
of the second quarter, Ontario Solar's 50% owned joint venture,
Ontario Solar PV Fields ("OSPV") signed a definitive agreement to
sell four ground-mount solar projects, representing approximately
34 megawatts. The transaction is subject to a number of approvals
and conditions, including the purchaser securing financing for the
projects. The Company expects the transaction to close in
early calendar 2013. OSPV will retain 25% ownership of the projects
until the projects reach commercial operation, which is expected to
happen in the second half of calendar 2013. Net proceeds to the
Company are expected to be approximately $20
million, which is expected to be paid out through calendar
2013, based on the projects achieving certain development
milestones.
The Company intends to complete the separation
of Solar via the divestment of the remaining projects owned by OSPV
and the Ontario Solar
manufacturing operations. The value to be derived from the sale of
the remaining solar assets is unknown. The Company is continuing to
work with interested parties to conclude agreements.
Regarding PWF, on November 8, 2011, a hearing was held at which
time the French bankruptcy court placed PWF into a "recovery"
proceeding ("redressement judiciaire") under the supervision of a
court-appointed trustee. The Company concluded that it ceased to
have the ability to exert control over PWF, and accordingly, the
Company's investment in PWF was deconsolidated from the Company's
consolidated financial statements. Effective March 1, 2012, a third-party assumed control over
the entire operations of the PWF assets and all employees were
offered to be transferred to the new operator. This concluded ATS's
operating support of PWF. However, until all matters are resolved
under the bankruptcy process, additional provisions may be
required. The Company will record any such provision if and
when it becomes known and the Company determines that the
obligation will result in a probable outflow of economic resources
and, the Company is able to measure the obligation with sufficient
reliability.
LIQUIDITY, CASH FLOW AND FINANCIAL
RESOURCES
(In millions of dollars, except ratios)
| As at |
|
|
September 30,
2012 |
|
|
March
31,
2012 |
| Cash and cash equivalents |
|
$ |
104.8 |
|
$ |
96.2 |
| Debt-to-equity ratio |
|
|
0.01:1 |
|
|
0.01:1 |
| |
|
|
|
|
|
|
| For the three months ended |
|
|
September 30,
2012 |
|
|
October 2,
2011 |
| Cash flows provided by operating activities from
continuing operations |
|
$ |
27.8 |
|
$ |
4.8 |
At September 30,
2012, the Company had cash and cash equivalents of
$104.8 million compared to
$96.2 million at March 31, 2012. The Company's total
debt-to-total-equity ratio, excluding accumulated other
comprehensive income, at September 30,
2012 was 0.01:1. At September 30,
2012, the Company had $30.8
million of unutilized credit available under existing credit
facilities and another $7.5 million
available under letter of credit facilities.
In the three months ended September 30, 2012, cash flows provided by
operating activities from continuing operations were $27.8 million ($4.8
million provided by in the corresponding period a year ago).
In the six months ended September 30,
2012, cash flows provided by operating activities from
continuing operations were $25.8
million ($20.8 million used in
the corresponding period a year ago). The increase in cash
flows provided by operating activities from continuing operations
related primarily to the timing of investments in non-cash working
capital in a number of large customer programs.
In the second quarter of fiscal 2013, the
Company's investment in non-cash working capital decreased by
$13.8 million from July 1, 2012. On a year-to-date basis, investment
in non-cash working capital increased by $5.0 million. Accounts receivable increased 15%
or $13.8 million, due to timing of
billings on certain customer contracts. Net contracts in progress
decreased by 51% or $34.8 million
compared to March 31, 2012. The
Company actively manages its accounts receivable and net contracts
in progress balances through billing terms on long-term contracts
and by focusing on collection efforts. Inventories increased year
over year by 7% or $0.7
million. Deposits and prepaid assets increased by 36%
or $4.4 million due primarily to an
increase in prepaid assets due to timing of payments, coupled with
an increase in restricted cash used to secure letters of credit.
Accounts payable and accrued liabilities decreased 21% primarily
due to timing of purchases.
Capital expenditures totalled $3.4 million for the first half of fiscal 2013
and primarily related to computer hardware and equipment
improvements.
The Company expects to continue increasing its
investment in working capital to support its base business. The
Company expects that continued cash flows from operations, together
with cash and cash equivalents on hand and credit available under
operating and long-term credit facilities, will be sufficient to
fund its requirements for investments in working capital and
capital assets and to fund strategic investment plans including
some potential acquisitions. Significant acquisitions could result
in additional debt or equity financing requirements. The Company
expects to use moderate leverage to support its growth
strategy.
The Company's primary credit facility provided
total credit facilities of up to $95.0
million, comprised of an operating credit facility of
$65.0 million and a letter of credit
facility of up to $30.0 million for
certain purposes. At September 30,
2012, the Company had issued letters of credit in the amount
of $35.8 million under the operating
credit facility (March 31, 2012 -
$17.0 million) and $28.4 million under the letter of credit facility
(March 31, 2012 - $30.0 million). No other amounts were drawn on
the primary credit facility.
Subsequent to September
30, 2012, the Company established a new, larger and more
flexible Senior Secured Credit Facility (the "Credit Agreement")
which replaced the former primary credit facility. The Credit
Agreement provides a three year committed revolving credit facility
of $250.0 million. The Credit
Agreement is secured by the assets, excluding real estate, of
certain of the Company's North American legal entities and a pledge
of shares and guarantees from certain of the Company's legal
entities.
The operating credit facility is available in
Canadian dollars by way of prime rate advances, letters of credit
for certain purposes and/or bankers' acceptances and in U.S.
dollars by way of base rate advances and/or LIBOR advances. The
interest rates applicable to the operating credit facility are
determined based on certain financial ratios. For prime rate
advances and base rate advances, the interest rate is equal to the
bank's prime rate or the bank's U.S. dollar base rate in
Canada, respectively, plus 0.50%
to 1.50%. For bankers' acceptances and LIBOR advances, the interest
rate is equal to the bankers' acceptance fee or the LIBOR,
respectively, plus 1.50% to 2.50%. Under the Credit Agreement, the
Company pays a fee for usage of financial letters of credit which
ranges from 1.70% to 2.70% and a fee for usage of non-financial
letters of credit which ranges from 1.15% to 1.80%. The Company
also pays a standby fee on the unadvanced portions of the amounts
available for advance or draw-down under the credit facilities at
rates ranging from 0.30% to 0.50%.
The Credit Agreement is subject to a debt to
EBITDA test and an interest coverage test. Under the terms of
the Credit Agreement, the Company is restricted from encumbering
any assets with certain permitted exceptions. The Credit
Agreement also limits advances to certain subsidiaries and
partially restricts the Company from repurchasing its common shares
and paying dividends.
The Company has additional credit facilities
available of $9.1 million
(5.9 million Euro, 33.0 million Indian Rupees and 1.0 million Swiss francs). The total amount
outstanding on these facilities is $2.4
million (March 31, 2012 -
$3.0 million), of which $0.1 million is classified as bank indebtedness
(March 31, 2012 - $0.4 million) and $2.3
million is classified as long-term debt (March 31, 2012 - $2.5
million). The interest rates applicable to these
additional credit facilities range from 2.8% to 13.0% per
annum. A portion of the long-term debt is secured by certain
assets of the Company. The 1.0 million Swiss
Francs and the 33.0 million Indian
Rupees credit facilities are secured by letters of credit
under the primary credit facility.
Contractual Obligations
(In millions of dollars)
The minimum operating lease payments related
primarily to facilities and equipment, purchase obligations and
other obligations are as follows:
| From continuing operations: |
|
|
|
|
|
|
| |
|
|
Operating
Leases
|
|
|
Purchase
Obligations |
| Less than one
year |
|
$ |
3.7 |
|
$ |
39.5 |
| One - two years |
|
|
2.7 |
|
|
0.2 |
| Two - three years |
|
|
2.4 |
|
|
― |
| Three - four years |
|
|
1.7 |
|
|
― |
| Four - five years |
|
|
1.6 |
|
|
― |
| Due in over five
years |
|
|
3.2 |
|
|
― |
| |
|
$ |
15.3 |
|
$ |
39.7 |
| |
|
|
|
|
|
|
| From discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
Purchase
Obligations |
| Due within one
year |
|
|
|
|
$ |
1.1 |
The Company's off-balance sheet arrangements
consist of purchase obligations and various operating lease
financing arrangements related primarily to facilities and
equipment, which have been entered into in the normal course of
business. The Company's purchase obligations consist primarily of
materials purchase commitments.
In accordance with industry practice, the
Company is liable to customers for obligations relating to contract
completion and timely delivery. In the normal conduct of its
operations, the Company may provide bank guarantees as security for
advances received from customers pending delivery and contract
performance. In addition, the Company provides bank
guarantees for post-retirement obligations and may provide bank
guarantees as security on equipment under lease and on order. At
September 30, 2012, the total value
of outstanding bank guarantees under credit facilities was
approximately $86.3 million
(March 31, 2012 - $54.2 million) from continuing operations and was
$3.2 million (March 31, 2012 - $3.2
million) from discontinued operations.
The Company is exposed to credit risk on
derivative financial instruments arising from the potential for
counterparties to default on their contractual obligations to the
Company. The Company minimizes this risk by limiting counterparties
to major financial institutions and monitoring their
creditworthiness. The Company's credit exposure to forward foreign
exchange contracts is the current replacement value of contracts
that are in a gain position. For further information related
to the Company's use of derivative financial instruments refer to
note 10 of the interim consolidated financial statements. The
Company is also exposed to credit risk from its customers.
Substantially all of the Company's trade accounts receivable are
due from customers in a variety of industries and, as such, are
subject to normal credit risks from their respective
industries. The Company regularly monitors customers for
changes in credit risk. The Company does not believe that any
single industry or geographic region represents significant credit
risk. Credit risk concentration with respect to trade
receivables is mitigated by the Company's client base being
primarily large, multinational customers and through insurance
purchased by the Company.
During the first two quarters of fiscal 2013,
192,062 stock options were exercised. As of November 6, 2012 the total number of shares
outstanding was 87,631,817 and there were 7,316,118 stock options
outstanding to acquire common shares of the Company.
RELATED-PARTY TRANSACTIONS
There were no significant related-party transactions in the first
half of fiscal 2013.
FOREIGN EXCHANGE
The Company is exposed to foreign exchange risk as a result of
transactions in currencies other than its functional currency of
the Canadian dollar. Strengthening in the value of the Canadian
dollar relative to the Euro dollar had a negative impact on
translation of the Company's revenues in fiscal 2013 compared to
fiscal 2012.
The Company's Canadian operations generate
significant revenues in major foreign currencies, primarily U.S.
dollars, which exceed the natural hedge provided by purchases of
goods and services in those currencies. In order to manage a
portion of this net foreign currency exposure, the Company has
entered into forward foreign exchange contracts. The timing and
amount of these forward foreign exchange contract requirements are
estimated based on existing customer contracts on hand or
anticipated, current conditions in the Company's markets and the
Company's past experience. Certain of the Company's foreign
subsidiaries will also enter into forward foreign exchange
contracts to hedge identified balance sheet, revenue and purchase
exposures. The Company's forward foreign exchange contract hedging
program is intended to mitigate movements in currency rates
primarily over a four-to-six month period. See note 10 to the
interim consolidated financial statements for details on the
derivative financial instruments outstanding at September 30, 2012.
In addition, from time to time, the Company
enters forward foreign exchange contracts to manage the foreign
exchange risk arising from certain inter-company loans and net
investments in certain self-sustaining subsidiaries.
The Company uses hedging as a risk management
tool, not to speculate.
Period average exchange rates in CDN$
| |
Three months ended |
Six months ended |
| |
September 30,
2012 |
October 2,
2011 |
% change |
October 2,
2011 |
September
26, 2010 |
% change |
| U.S. Dollar |
0.9939 |
0.9824 |
1.2 % |
1.0028 |
0.9757 |
2.8 % |
| Euro |
1.2447 |
1.3861 |
-10.2 % |
1.2698 |
1.3901 |
-8.7 % |
CONSOLIDATED QUARTERLY RESULTS
Results have been reclassified to present Solar as discontinued
operations.
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (In millions of dollars, except
per share amounts) |
|
|
Q2
2013 |
|
|
Q1
2013 |
|
|
Q4
2012 |
|
|
Q3
2012 |
|
|
Q2
2012 |
|
|
Q1
2012 |
|
|
Q4
2011 |
|
|
Q3
2011 |
| Revenues from continuing operations |
|
$ |
141.4 |
|
$ |
152.2 |
|
$ |
173.5 |
|
$ |
149.1 |
|
$ |
145.9 |
|
$ |
126.9 |
|
$ |
148.4 |
|
$ |
120.8 |
| Earnings from operations |
|
$ |
13.8 |
|
$ |
15.2 |
|
$ |
16.1 |
|
$ |
20.4 |
|
$ |
13.3 |
|
$ |
10.5 |
|
$ |
14.2 |
|
$ |
6.1 |
| Income from continuing operations |
|
$ |
9.7 |
|
$ |
11.8 |
|
$ |
10.9 |
|
$ |
17.6 |
|
$ |
9.3 |
|
$ |
6.2 |
|
$ |
14.4 |
|
$ |
3.0 |
| Loss from discontinued operations, net of tax |
|
$ |
(1.8) |
|
$ |
(2.0) |
|
$ |
(7.9) |
|
$ |
(8.0) |
|
$ |
(76.4) |
|
$ |
(11.2) |
|
$ |
(93.9) |
|
$ |
(16.1) |
| Net income (loss) |
|
$ |
7.9 |
|
$ |
9.8 |
|
$ |
3.0 |
|
$ |
9.6 |
|
$ |
(67.1) |
|
$ |
(5.0) |
|
$ |
(79.5) |
|
$ |
(13.1) |
| Basic and diluted earnings per
share from continuing operations |
|
$ |
0.11 |
|
$ |
0.13 |
|
$ |
0.13 |
|
$ |
0.20 |
|
$ |
0.11 |
|
$ |
0.07 |
|
$ |
0.17 |
|
$ |
0.03 |
| Basic and diluted loss per share from discontinued
operations |
|
$ |
(0.02) |
|
$ |
(0.02) |
|
$ |
(0.09) |
|
$ |
(0.09) |
|
$ |
(0.87) |
|
$ |
(0.13) |
|
$ |
(1.08) |
|
$ |
(0.18) |
| Basic and diluted earnings (loss) per share |
|
$ |
0.09 |
|
$ |
0.11 |
|
$ |
0.04 |
|
$ |
(0.11) |
|
$ |
(0.76) |
|
$ |
(0.06) |
|
$ |
(0.91) |
|
$ |
(0.15) |
| ASG Order Bookings |
|
$ |
112.0 |
|
$ |
168.0 |
|
$ |
187.0 |
|
$ |
179.0 |
|
$ |
165.0 |
|
$ |
157.0 |
|
$ |
206.0 |
|
$ |
133.0 |
| ASG Order Backlog |
|
$ |
361.0 |
|
$ |
397.0 |
|
$ |
382.0 |
|
$ |
376.0 |
|
$ |
363.0 |
|
$ |
328.0 |
|
$ |
296.0 |
|
$ |
215.0 |
Interim financial results are not necessarily
indicative of annual or longer-term results because many of the
individual markets served by the Company tend to be cyclical in
nature. General economic trends, product life cycles and
product changes may impact revenues and operating performance. ATS
typically experiences some seasonality with its revenues and
operating earnings due to summer plant shutdowns by its
customers.
CRITICAL ACCOUNTING ESTIMATES, JUDGEMENTS &
ASSUMPTIONS
The preparation of the Company's consolidated
financial statements requires management to make estimates,
judgements and assumptions that affect the reported amounts of
assets, liabilities, revenues and expenses, and the disclosure of
contingent assets and liabilities at the end of the reporting
period. Uncertainty about these estimates, judgements and
assumptions could result in outcomes that require a material
adjustment to the carrying amount of the asset or liability
affected in future periods.
The Company based its assumptions on information
available when the consolidated financial statements were prepared.
Existing circumstances and assumptions about future developments
may change due to market changes or circumstances arising beyond
the control of the Company. Such changes are reflected in the
estimates as they occur. There have been no material changes to the
critical accounting estimates as described in the Company's fiscal
2012 MD&A.
ACCOUNTING STANDARDS CHANGES
IFRS 7 - Financial Instruments: Disclosures - Enhanced
Derecognition Disclosure Requirements
Effective April 1, 2012, the Company
adopted the Canadian Institute of Chartered Accountants ("CICA")
amendment to IFRS 7 "Financial Instruments: Disclosures - Enhanced
Derecognition Disclosure Requirements." The amendment requires
additional disclosures for financial assets that have been
transferred, but not derecognized. In addition, the amendment
requires disclosures for continuing involvement in derecognized
assets. The adoption of these amendments did not have a material
impact on the financial position, cash flows or earnings of the
Company.
Future Accounting Standards Changes
Standards issued but not yet effective or amended up to the date of
issuance of the Company's interim consolidated financial statements
are listed below. This listing is of standards and interpretations
issued, which the Company reasonably expects to be applicable at a
future date. The Company intends to adopt these standards when they
become effective.
IFRS 9 - Financial Instruments: Classification and
Measurement
IFRS 9 as issued reflects the first phase of the IASB's work on the
replacement of IAS 39 and applies to classification and measurement
of financial assets and financial liabilities as defined in IAS 39.
The standard is effective for fiscal periods beginning on or after
January 1, 2015. In subsequent
phases, the IASB will address hedge accounting and impairment of
financial assets. The adoption of the first phase of IFRS 9
will have an impact on the classification and measurement of
financial assets, but will potentially have no impact on
classification and measurement of financial liabilities. The
Company will quantify the impact in conjunction with the other
phases when issued.
IFRS 10 - Consolidated Financial Statements
This standard will replace portions of IAS 27, Consolidated and
Separate Financial Statements and interpretation SIC-12,
Consolidated - Special Purpose Entities. This standard incorporates
a single model for consolidating all entities that are controlled
and revises the definition of when an investor controls an investee
to be when it is exposed, or has rights, to variable returns from
its involvement with the investee and has the current ability to
affect those returns through its power over the investee. Along
with control, the new standard also focuses on the concept of
power, both of which will include a use of judgment and a
continuous reassessment as facts and circumstances change. IFRS 10
is effective for fiscal periods beginning on or after January 1, 2013, with early adoption permitted.
The Company is assessing the impact of IFRS 10 on its financial
position and results of operations.
IFRS 11 - Joint Arrangements
This standard will replace IAS 31, Interest in Joint Ventures. The
new standard will apply to the accounting for interest in joint
arrangements where there is joint control. Joint arrangements will
be separated into joint ventures and joint operations. The
structure of the joint arrangement will no longer be the most
significant factor on classifying a joint arrangement as either a
joint operation or a joint venture. IFRS 11 is effective for fiscal
periods beginning on or after January 1,
2013, with early adoption permitted. The Company is
assessing the impact of IFRS 11 on its financial position and
results of operations.
IFRS 12 - Disclosure of Interest in Other Entities
The new standard includes disclosure requirements for subsidiaries,
joint ventures and associates, as well as unconsolidated structured
entities and replaces existing disclosure requirements. IFRS 12 is
effective for fiscal periods beginning on or after January 1, 2013, with early adoption permitted.
The Company is assessing the impact of IFRS 12 on its financial
position and results of operations.
IFRS 13 - Fair Value Measurement
The new standard creates a single source of guidance for fair value
measurement, where fair value is required or permitted under IFRS,
by not changing how fair value is used but how it is measured. The
focus will be on an exit price. IFRS 13 is effective for fiscal
periods beginning on or after January 1,
2013, with early adoption permitted. The Company is
assessing the impact of IFRS 13 on its financial position and
results of operations.
IAS 1 - Presentation of Financial Statements
The amendment requires financial statements to group together items
within other comprehensive income that may be reclassified to the
profit or loss section of the interim consolidated statements of
income. The amendment reaffirms existing requirements that items in
other comprehensive income and profit or loss should be presented
as either a single statement or two consecutive statements. The
amendment requires tax associated with items presented before tax
to be shown separately for each of the two groups of other
comprehensive income items (without changing the option to present
items of other comprehensive income either before tax or net of
tax). IAS 1 is effective for fiscal periods beginning on or after
July 1, 2012, with early adoption
permitted. The Company is assessing the impact of IAS 1 on its
financial position and results of operations.
IAS 19 - Employee Benefits
The amendment eliminates the option to defer the recognition of
gains and losses, known as the 'corridor method', requires
re-measurements to be presented in other comprehensive income, and
enhances the disclosure requirements for defined benefit plans. The
standard also requires that the discount rate used to determine the
defined benefit obligation should also be used to calculate the
expected return on plan assets by introducing a net interest
approach, which replaces the expected return on plan assets and
interest costs on the defined benefit obligation, with a single net
interest component determined by multiplying the net defined
benefit liability or asset by the discount rate used to determine
the defined benefit obligation. The amendment becomes effective for
fiscal periods beginning on or after January
1, 2013. The Company is assessing the impact of IAS 19 on
its financial position and results of operations.
CONTROLS AND PROCEDURES
The Chief Executive Officer ("CEO") and the Chief Financial Officer
("CFO") are responsible for establishing and maintaining disclosure
controls and procedures and internal controls over financial
reporting for the Company. The control framework used in the design
of disclosure controls and procedures and internal control over
financial reporting is the internal control integrated framework
issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO).
Management, including the CEO and CFO, does not
expect that the Company's disclosure controls or internal controls
over financial reporting will prevent or detect all errors and all
fraud or will be effective under all potential future conditions. A
control system is subject to inherent limitations and, no matter
how well designed and operated, can provide only reasonable, not
absolute, assurance that the control systems objectives will be
met.
During the three and six months ended
September 30, 2012, there have been
no changes in the Company's internal controls over financial
reporting that have materially affected, or are reasonably likely
to materially affect, the Company's internal controls over
financial reporting.
Note to Readers: Forward-Looking Statements:
This news release and management's discussion and analysis of
financial conditions, and results of operations of ATS contains
certain statements that constitute forward-looking information
within the meaning of applicable securities laws ("forward-looking
statements"). Such forward-looking statements involve known
and unknown risks, uncertainties and other factors that may cause
the actual results, performance or achievements of ATS, or
developments in ATS' business or in its industry, to differ
materially from the anticipated results, performance, achievements
or developments expressed or implied by such forward-looking
statements. Forward-looking statements include all disclosure
regarding possible events, conditions or results of operations that
is based on assumptions about future economic conditions and
courses of action. Forward-looking statements may also
include, without limitation, any statement relating to future
events, conditions or circumstances. ATS cautions you not to place
undue reliance upon any such forward-looking statements, which
speak only as of the date they are made. Forward-looking
statements relate to, among other things: the next phase of the
Company's strategy: grow, expand, and scale; a Nigerian contract
and expectations in relation to project timing, financial close,
and timing of delivery; potential impact of general economic
environment, including impact on credit markets, customer markets,
and Order Bookings, and the timing of those impacts; the sales
organization's approach to market and expected impact on Order
Bookings; management's expectations in relation to the impact of
strategic initiatives on ATS operations; the Company's strategy to
expand organically and through acquisition; separation of solar
business; the expected closing with respect to the definitive
agreement in relation to four joint venture ground mount solar
projects and expected net proceeds and timing thereof; the
Company's intention to divest the remaining Ontario Solar
assets; Company's expectation to continue to increase its
investment in working capital; expectation in relation to meeting
funding requirements for investments; foreign exchange hedging; and
accounting standards changes. The risks and uncertainties
that may affect forward-looking statements include, among others:
impact of the global economy and the Eurozone sovereign debt
crisis; general market performance including capital market
conditions and availability and cost of credit; performance of the
market sectors that ATS serves; foreign currency and exchange risk;
the relative strength of the Canadian dollar; impact of factors
such as increased pricing pressure and possible margin compression;
the regulatory and tax environment; failure of the Nigerian project
to achieve financial close or satisfy other conditions or meet
expected timelines; inability to successfully expand organically or
through acquisition, due to an inability to grow expertise,
personnel, and/or facilities at required rates or to identify,
negotiate and conclude one or more acquisitions; that strategic
initiatives within ASG are delayed, not completed, or do not have
intended positive impact; that the conditions in the agreement for
the sale of four joint venture ground mount solar projects are not
met or that there are delays in meeting conditions and/or achieving
stated milestones; that the sale process for Ontario Solar's
remaining assets fails to generate an acceptable transaction or
that remaining joint venture ground mount projects cannot be
developed, or a definitive agreement with respect to their sale
cannot be concluded, due to market, regulatory, transmission, local
opposition, or other factors; unexpected delays and issues, on the
timing, form and structure of the solar separation; ability to
obtain necessary government and other certifications and approvals
for solar projects in a timely fashion; labour disruptions; that
expenditures associated with the PWF bankruptcy exceed current
expectations; that one or more customers, or other persons with
which the Company has contracted, experience insolvency or
bankruptcy with resulting delays, costs or losses to the Company;
political, labour or supplier disruptions; the development of
superior or alternative technologies to those developed by ATS; the
success of competitors with greater capital and resources in
exploiting their technology; market risk for developing
technologies; risks relating to legal proceedings to which ATS is
or may become a party; exposure to product liability claims; risks
associated with greater than anticipated tax liabilities or
expenses; and other risks detailed from time to time in ATS's
filings with Canadian provincial securities
regulators. Forward-looking statements are based on
management's current plans, estimates, projections, beliefs and
opinions, and other than as required by applicable securities laws,
ATS does not undertake any obligation to update forward-looking
statements should assumptions related to these plans, estimates,
projections, beliefs and opinions change.
ATS AUTOMATION TOOLING SYSTEMS INC.
Interim Consolidated Statements of Financial Position
(in thousands of Canadian dollars - unaudited)
| As at |
Note |
|
|
September 30,
2012 |
|
|
March 31,
2012 |
| |
|
|
|
|
|
|
|
| ASSETS |
|
|
|
|
|
|
|
| Current assets |
|
|
|
|
|
|
|
| Cash and cash equivalents |
|
|
$ |
104,825 |
|
$ |
96,229 |
| Accounts receivable |
|
|
|
103,922 |
|
|
90,151 |
| Costs and earnings in excess of billings |
|
|
|
|
|
|
|
| on contracts in progress |
5 |
|
|
102,612 |
|
|
112,486 |
| Inventories |
5 |
|
|
11,011 |
|
|
10,278 |
| Deposits, prepaids and other assets |
6 |
|
|
16,907 |
|
|
12,474 |
| |
|
|
|
339,277 |
|
|
321,618 |
| Assets associated with discontinued
operations |
4 |
|
|
35,352 |
|
|
35,746 |
| |
|
|
|
374,629 |
|
|
357,364 |
| Non-current assets |
|
|
|
|
|
|
|
| Property, plant and equipment |
7 |
|
|
77,505 |
|
|
78,880 |
| Investment property |
8 |
|
|
3,601 |
|
|
3,792 |
| Goodwill |
|
|
|
56,929 |
|
|
58,320 |
| Intangible assets |
9 |
|
|
27,054 |
|
|
28,641 |
| Deferred income tax assets |
|
|
|
13,444 |
|
|
15,544 |
| Investment tax credit receivable |
|
|
|
27,640 |
|
|
26,087 |
| |
|
|
|
206,173 |
|
|
211,264 |
| Total assets |
|
|
$ |
580,802 |
|
$ |
568,628 |
| |
|
|
|
|
|
|
|
| LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
| Current liabilities |
|
|
|
|
|
|
|
| Bank indebtedness |
|
|
$ |
55 |
|
$ |
434 |
| Accounts payable and accrued liabilities |
|
|
|
89,605 |
|
|
113,133 |
| Provisions |
11 |
|
|
9,504 |
|
|
9,696 |
| Billings in excess of costs and |
|
|
|
|
|
|
|
| earnings on contracts in progress |
5 |
|
|
68,960 |
|
|
44,016 |
| Current portion of long-term debt |
12 |
|
|
249 |
|
|
263 |
| |
|
|
|
168,373 |
|
|
167,542 |
| Liabilities associated with discontinued
operations |
4 |
|
|
7,588 |
|
|
9,969 |
| |
|
|
|
175,961 |
|
|
177,511 |
| Non-current liabilities |
|
|
|
|
|
|
|
| Employee benefits |
|
|
|
7,269 |
|
|
6,340 |
| Long-term debt |
12 |
|
|
2,024 |
|
|
2,262 |
| Deferred income tax liability |
|
|
|
2,033 |
|
|
1,063 |
| |
|
|
|
11,326 |
|
|
9,665 |
| Total liabilities |
|
|
$ |
187,287 |
|
$ |
187,176 |
| |
|
|
|
|
|
|
|
| EQUITY |
|
|
|
|
|
|
|
| Share capital |
13 |
|
$ |
484,751 |
|
$ |
483,099 |
| Contributed surplus |
|
|
|
18,537 |
|
|
17,868 |
| Accumulated other comprehensive loss |
|
|
|
(7,810) |
|
|
(383) |
| Retained deficit |
|
|
|
(102,057) |
|
|
(119,210) |
| Equity attributable to shareholders |
|
|
|
393,421 |
|
|
381,374 |
| Non-controlling interests |
|
|
|
94 |
|
|
78 |
| Total equity |
|
|
|
393,515 |
|
|
381,452 |
| Total liabilities and equity |
|
|
$ |
580,802 |
|
$ |
568,628 |
ATS AUTOMATION TOOLING SYSTEMS INC.
Interim Consolidated Statements of Income
(in thousands of Canadian dollars, except per share amounts -
unaudited)
| |
|
|
|
Three months ended |
|
|
Six months ended |
| |
Note |
|
|
September 30
2012 |
|
|
October 2
2011 |
|
|
September 30
2012 |
|
|
October 2
2011 |
| Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Revenues from construction contracts |
|
|
$ |
128,088 |
|
$ |
134,028 |
|
$ |
269,662 |
|
$ |
249,106 |
| |
Sale of goods |
|
|
|
6,873 |
|
|
5,522 |
|
|
11,684 |
|
|
11,357 |
| |
Services rendered |
|
|
|
6,484 |
|
|
6,384 |
|
|
12,308 |
|
|
12,346 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total revenues |
|
|
|
141,445 |
|
|
145,934 |
|
|
293,654 |
|
|
272,809 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating costs and expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Cost of revenues |
|
|
|
103,685 |
|
|
109,058 |
|
|
215,758 |
|
|
201,396 |
| |
Selling, general and administrative |
|
|
|
23,347 |
|
|
22,995 |
|
|
47,355 |
|
|
45,869 |
| |
Stock-based compensation |
15 |
|
|
611 |
|
|
620 |
|
|
1,573 |
|
|
1,756 |
| Earnings from operations |
|
|
|
13,802 |
|
|
13,261 |
|
|
28,968 |
|
|
23,788 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net finance costs |
19 |
|
|
531 |
|
|
144 |
|
|
732 |
|
|
745 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income from
continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
before income taxes |
|
|
|
13,271 |
|
|
13,117 |
|
|
28,236 |
|
|
23,043 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income tax expense |
14 |
|
|
3,563 |
|
|
3,825 |
|
|
6,755 |
|
|
7,543 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income from continuing
operations |
|
|
|
9,708 |
|
|
9,292 |
|
|
21,481 |
|
|
15,500 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Loss from discontinued
operations, |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
net of tax |
4 |
|
|
(1,752) |
|
|
(76,371) |
|
|
(3,763) |
|
|
(87,593) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) |
|
|
$ |
7,956 |
|
$ |
(67,079) |
|
$ |
17,718 |
|
$ |
(72,093) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Attributable to |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Shareholders |
|
|
$ |
7,945 |
|
$ |
(67,154) |
|
$ |
17,702 |
|
$ |
(72,170) |
| Non-controlling interests |
|
|
|
11 |
|
|
75 |
|
|
16 |
|
|
77 |
| |
|
|
$ |
7,956 |
|
$ |
(67,079) |
|
$ |
17,718 |
|
$ |
(72,093) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Earnings (loss) per
share |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
attributable to shareholders |
20 |
|
|
|
|
|
|
|
|
|
|
|
|
| Basic and diluted - |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
from continuing operations |
|
|
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.24 |
|
$ |
$0.18 |
| Basic and diluted - |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
from discontinued operations |
4 |
|
|
(0.02) |
|
|
(0.87) |
|
|
(0.04) |
|
|
(1.00) |
| |
|
|
$ |
0.09 |
|
$ |
(0.76) |
|
$ |
0.20 |
|
$ |
(0.82) |
ATS AUTOMATION TOOLING SYSTEMS INC.
Interim Consolidated Statements of Comprehensive Income
(in thousands of Canadian dollars - unaudited)
| |
|
|
Three months ended |
|
|
Six months ended |
| |
|
|
September 30
2012 |
|
|
October 2
2011 |
|
|
September 30
2012 |
|
|
October 2
2011 |
| Net income (loss) |
|
$ |
7,956 |
|
$ |
(67,079) |
|
$ |
17,718 |
|
$ |
(72,093) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Other comprehensive income
(loss): |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Currency translation adjustment (net of income taxes of
$nil) |
|
|
(7,442) |
|
|
10,155 |
|
|
(7,738) |
|
|
11,372 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net unrealized gain (loss) on derivative financial
instruments
designated as cash flow hedges |
|
|
1,333 |
|
|
(2,991) |
|
|
266 |
|
|
(2,773) |
| |
Tax impact |
|
|
(290) |
|
|
716 |
|
|
(38) |
|
|
669 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Loss (gain) transferred to net income for
derivatives designated as cash flow hedges |
|
|
310 |
|
|
(781) |
|
|
133 |
|
|
(1,507) |
| |
Tax impact |
|
|
(80) |
|
|
195 |
|
|
(50) |
|
|
388 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Actuarial losses on defined benefit pension plans |
|
|
- |
|
|
- |
|
|
(736) |
|
|
- |
| |
Tax impact |
|
|
- |
|
|
- |
|
|
187 |
|
|
- |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net gain on hedges of net investments in foreign
operations (net of income taxes of $nil) |
|
|
- |
|
|
63 |
|
|
- |
|
|
221 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Other comprehensive income (loss) |
|
|
(6,169) |
|
|
7,357 |
|
|
(7,976) |
|
|
8,370 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Comprehensive income (loss) |
|
$ |
1,787 |
|
$ |
(59,722) |
|
$ |
9,742 |
|
$ |
(63,723) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
| Attributable to |
|
|
|
|
|
|
|
|
|
|
|
|
| Shareholders |
|
$ |
1,776 |
|
$ |
(59,797) |
|
$ |
9,726 |
|
$ |
(63,800) |
| Non-controlling interests |
|
|
11 |
|
|
75 |
|
|
16 |
|
|
77 |
| |
|
$ |
1,787 |
|
$ |
(59,722) |
|
$ |
9,742 |
|
$ |
(63,723) |
ATS AUTOMATION TOOLING SYSTEMS INC.
Interim Consolidated Statements of Changes in Equity
(in thousands of Canadian dollars - unaudited)
| Six months ended September 30, 2012 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
capital |
|
|
Contributed
surplus |
|
|
Retained
earnings
(deficit) |
|
|
Currency
translation
adjustments |
|
|
Cash flow
hedges |
|
|
Total
accumulated
other
comprehensive
income |
|
|
Non-
controlling
interests |
|
|
Total
equity |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, at March 31, 2012 |
|
$ |
483,099 |
|
$ |
17,868 |
|
$ |
(119,210) |
|
$ |
(559) |
|
$ |
176 |
|
$ |
(383) |
|
$ |
78 |
|
$ |
381,452 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income |
|
|
- |
|
|
- |
|
|
17,702 |
|
|
- |
|
|
- |
|
|
- |
|
|
16 |
|
|
17,718 |
| Other comprehensive income (loss) |
|
|
- |
|
|
- |
|
|
(549) |
|
|
(7,738) |
|
|
311 |
|
|
(7,427) |
|
|
- |
|
|
(7,976) |
| Total comprehensive income (loss) |
|
|
- |
|
|
- |
|
|
17,153 |
|
|
(7,738) |
|
|
311 |
|
|
(7,427) |
|
|
16 |
|
|
9,742 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Stock-based compensation |
|
|
- |
|
|
1,182 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
1,182 |
| Exercise of stock options |
|
|
1,652 |
|
|
(513) |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
1,139 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, at September 30, 2012 |
|
$ |
484,751 |
|
$ |
18,537 |
|
$ |
(102,057) |
|
$ |
(8,297) |
|
$ |
487 |
|
$ |
(7,810) |
|
$ |
94 |
|
$ |
393,515 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Six months ended October 2, 2011 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
capital |
|
|
Contributed
surplus |
|
|
Retained
earnings
(deficit) |
|
|
Currency
translation
adjustments |
|
|
Cash flow
hedges |
|
|
Total
accumulated
other
comprehensive
income |
|
|
Non-
controlling
interests |
|
|
Total
equity |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, at March 31, 2011 |
|
$ |
481,908 |
|
$ |
14,298 |
|
$ |
(59,659) |
|
$ |
(2,767) |
|
$ |
1,279 |
|
$ |
(1,488) |
|
$ |
(224) |
|
$ |
434,835 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (Ioss) |
|
|
- |
|
|
- |
|
|
(72,170) |
|
|
- |
|
|
- |
|
|
- |
|
|
77 |
|
|
(72,093) |
| Other comprehensive income (loss) |
|
|
- |
|
|
- |
|
|
- |
|
|
11,593 |
|
|
(3,223) |
|
|
8,370 |
|
|
- |
|
|
8,370 |
| Total comprehensive income (loss) |
|
|
- |
|
|
- |
|
|
(72,170) |
|
|
11,593 |
|
|
(3,223) |
|
|
8,370 |
|
|
- |
|
|
(63,723) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Stock-based compensation |
|
|
- |
|
|
1,756 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
1,756 |
| Exercise of stock options |
|
|
99 |
|
|
(29) |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
70 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Balance, at October 2, 2011 |
|
$ |
482,007 |
|
$ |
16,025 |
|
$ |
(131,829) |
|
$ |
8,826 |
|
$ |
(1,944) |
|
$ |
6,882 |
|
$ |
(147) |
|
$ |
372,938 |
ATS AUTOMATION TOOLING SYSTEMS INC.
Interim Consolidated Statements of Cash Flows
(in thousands of Canadian dollars - unaudited)
| |
|
|
|
Three months ended |
|
|
Six months ended |
| |
Note |
|
|
September 30
2012 |
|
|
October 2
2011 |
|
|
September 30
2012 |
|
|
October 2
2011 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Income from continuing
operations |
|
|
$ |
9,708 |
|
$ |
9,292 |
|
$ |
21,481 |
|
$ |
15,500 |
| Items not involving cash |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Depreciation of property, plant and
equipment |
|
|
|
1,590 |
|
|
1,608 |
|
|
3,210 |
|
|
3,424 |
| |
Amortization of intangible assets |
|
|
|
1,287 |
|
|
1,300 |
|
|
2,608 |
|
|
2,591 |
| |
Deferred income taxes |
|
|
|
1,319 |
|
|
800 |
|
|
3,111 |
|
|
1,929 |
| |
Other items not involving cash |
|
|
|
(480) |
|
|
(2,010) |
|
|
(1,213) |
|
|
(2,164) |
| |
Stock-based compensation |
15 |
|
|
611 |
|
|
620 |
|
|
1,573 |
|
|
1,756 |
| |
Gain on disposal of property,
plant and equipment |
|
|
|
7 |
|
|
(38) |
|
|
- |
|
|
(45) |
| |
|
|
$ |
14,042 |
|
$ |
11,572 |
|
$ |
30,770 |
|
$ |
22,991 |
| Change in non-cash operating working
capital |
|
|
|
13,751 |
|
|
(6,748) |
|
|
(4,990) |
|
|
(43,791) |
Cash flows used in operating
activities of
discontinued operations |
4 |
|
|
(1,694) |
|
|
(14,596) |
|
|
(4,774) |
|
|
(26,469) |
| Cash flows provided
by (used in) operating activities |
|
|
$ |
26,099 |
|
$ |
(9,772) |
|
$ |
21,006 |
|
$ |
(47,269) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Acquisition of property, plant and
equipment |
|
|
$ |
(2,319) |
|
$ |
(772) |
|
$ |
(3,411) |
|
$ |
(2,424) |
| Acquisition of intangible assets |
|
|
|
(759) |
|
|
(432) |
|
|
(2,123) |
|
|
(850) |
| Proceeds from disposal of property,
plant and equipment |
|
|
|
- |
|
|
3 |
|
|
7 |
|
|
516 |
| Proceeds on sale of portfolio
investments |
|
|
|
- |
|
|
- |
|
|
- |
|
|
2,054 |
Cash flows used in investing
activities of
discontinued operations |
4 |
|
|
(31) |
|
|
(3,237) |
|
|
(79) |
|
|
(5,104) |
| Cash flows used in investing
activities |
|
|
$ |
(3,109) |
|
$ |
(4,438) |
|
$ |
(5,606) |
|
$ |
(5,808) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Restricted cash |
6 |
|
|
(1,623) |
|
|
1,612 |
|
|
(3,266) |
|
|
2,913 |
| Bank indebtedness |
|
|
|
(94) |
|
|
(6,015) |
|
|
(347) |
|
|
(3,585) |
| Repayment of long-term debt |
|
|
|
(84) |
|
|
(91) |
|
|
(124) |
|
|
(132) |
| Issuance of common shares |
|
|
|
803 |
|
|
51 |
|
|
1,139 |
|
|
70 |
Cash flows provided by (used in)
financing
activities of discontinued operations |
4 |
|
|
(93) |
|
|
(3,813) |
|
|
(237) |
|
|
(881) |
| Cash flows used in financing
activities |
|
|
$ |
(1,091) |
|
$ |
(8,256) |
|
$ |
(2,835) |
|
$ |
(1,615) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Effect of exchange rate changes on
cash and cash equivalents |
|
|
(1,748) |
|
|
2,645 |
|
|
(3,309) |
|
|
2,779 |
| Increase (decrease) in
cash and cash equivalents |
|
|
|
20,151 |
|
|
(19,821) |
|
|
9,256 |
|
|
(51,913) |
| Cash and cash equivalents, beginning
of period |
|
|
|
85,797 |
|
|
92,176 |
|
|
96,692 |
|
|
124,268 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash and cash equivalents, end of
period |
|
|
$ |
105,948 |
|
$ |
72,355 |
|
$ |
105,948 |
|
$ |
72,355 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Attributable to |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash and cash equivalents - |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
continuing operations |
|
|
$ |
104,825 |
|
$ |
63,494 |
|
$ |
104,825 |
|
$ |
63,494 |
| Cash and cash equivalents - |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
associated with discontinued operations |
|
|
|
1,123 |
|
|
8,861 |
|
|
1,123 |
|
|
8,861 |
| |
|
|
$ |
105,948 |
|
$ |
72,355 |
|
$ |
105,948 |
|
$ |
72,355 |
| Supplemental information |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Cash income taxes paid by continuing
operations |
|
|
$ |
1,868 |
|
$ |
1,303 |
|
$ |
2,107 |
|
$ |
1,749 |
| Cash interest paid by continuing
operations |
|
|
$ |
206 |
|
$ |
58 |
|
$ |
449 |
|
$ |
135 |
| Cash interest paid by discontinued
operations |
|
|
$ |
- |
|
$ |
323 |
|
$ |
- |
|
$ |
816 |
SOURCE ATS Automation Tooling Systems Inc.