CAMBRIDGE, ON, Nov. 9, 2016 /CNW/ - ATS Automation Tooling
Systems Inc. (TSX: ATA) ("ATS" or the "Company") today
reported financial results for the three and six months ended
October 2, 2016.
Second Quarter Summary
- Revenues were $242.5 million, 8%
lower than a year ago, primarily reflecting the timing of project
activities;
- Earnings from operations were $17.3
million (7% operating margin), compared to $24.4 million (9% operating margin) in the second
quarter of fiscal 2016. Adjusted earnings from
operations1 were $22.3
million (9% margin), compared to $31.7 million (12% margin) in the second quarter
a year ago, primarily reflecting lower revenues and increased stock
compensation expenses;
- EBITDA1 was $25.3
million (10% margin), compared to $33.7 million (13% margin) in the second quarter
of fiscal 2016;
- Earnings per share were 9 cents
basic compared to 14 cents basic a
year ago. Adjusted basic earnings per share1 were
13 cents for the second quarter of
fiscal 2017 compared to 19 cents a
year ago;
- Order Bookings were $289 million,
a 26% increase from the second quarter of fiscal 2016;
- Period end Order Backlog was $654
million, 11% higher than at September
27, 2015. Approximately $70
million of Order Backlog relates to a program that was put
on hold by a customer subsequent to quarter end; and
- The Company's balance sheet and financial capacity to support
growth remained strong, with unutilized credit facilities of
$642.4 million and $2.5 million of credit available under letter of
credit facilities.
1 Non-IFRS measure: see "Notice to Reader: Non-IFRS
Measures and Additional IFRS Measures".
Financial
Results
|
In millions of
Canadian dollars
Except per share
data
|
3 months
ended
October
2,
2016
|
3 months
ended
September
27,
2015
|
6 months
ended
October
2,
2016
|
6 months
ended
September
27,
2015
|
Revenues
|
$
|
242.5
|
$
|
263.7
|
$
|
507.8
|
$
|
518.0
|
Earnings from
operations
|
$
|
17.3
|
$
|
24.4
|
$
|
39.9
|
$
|
41.9
|
Adjusted earnings
from operations1
|
$
|
22.3
|
$
|
31.7
|
$
|
50.2
|
$
|
59.1
|
EBITDA1
|
$
|
25.3
|
$
|
33.7
|
$
|
56.8
|
$
|
62.4
|
Net
income
|
$
|
8.5
|
$
|
12.8
|
$
|
20.6
|
$
|
22.6
|
Adjusted basic
earnings per share1
|
$
|
0.13
|
$
|
0.19
|
$
|
0.30
|
$
|
0.37
|
Basic and diluted
earnings per share
|
$
|
0.09
|
$
|
0.14
|
$
|
0.22
|
$
|
0.25
|
1 Non-IFRS
measure: see "Notice to Reader: Non-IFRS Measures and Additional
IFRS Measures".
|
"Second quarter operating performance was strong,
notwithstanding lower revenues," said Anthony Caputo, Chief Executive Officer "We
continued to advance our value creation plan with another
significant enterprise program which drove growth in Order
Bookings. Order Backlog remains significant, even with the on-hold
customer program. We have a strong balance sheet with significant
cash and funding available to pursue our growth strategy."
Second Quarter Summary
Fiscal 2017 second quarter
revenues were 8% lower than in the corresponding period a year ago,
primarily reflecting the timing of project activities. Foreign
exchange rate changes did not materially impact the translation of
revenues earned by foreign-based subsidiaries compared to the
corresponding period a year ago.
By market, fiscal 2017 second quarter revenues from consumer
products & electronics decreased 27%, primarily due to lower
activity in the consumer products market. Revenues generated in the
energy market increased 123% compared to the corresponding period a
year ago, primarily due to higher Order Backlog entering the second
quarter of 2017 compared to a year ago. Revenues generated in the
life sciences market decreased 10% compared to the corresponding
period a year ago, primarily reflecting lower Order Backlog
entering the second quarter of fiscal 2017 compared to a year
ago. Transportation revenues decreased 27% compared to a year
ago primarily due to lower activity compared to a year ago.
Fiscal 2017 second quarter earnings from operations were
$17.3 million (7% operating margin)
compared to $24.4 million (9%
operating margin) in the second quarter of fiscal 2016. Excluding
$5.0 million related to amortization
of identifiable intangible assets recorded on the acquisitions of
PA, IWK, and sortimat, second quarter fiscal 2017 adjusted earnings
from operations were $22.3 million
(9% margin). Second quarter fiscal 2016 earnings from operations
included $1.7 million of
restructuring and severance costs and $5.6
million related to the amortization of identifiable
intangible assets recorded on the acquisitions of PA, IWK and
sortimat. Excluding these items, last year's second quarter
adjusted earnings from operations were $31.7
million (12% margin). Lower adjusted earnings from
operations in the most recent period primarily reflected lower
revenues and increased stock compensation expenses.
Depreciation and amortization expense was $8.0 million in the second quarter of fiscal
2017, compared to $9.3 million a year
ago. The decrease primarily reflected lower amortization of
identifiable intangible assets recorded on the acquisitions of PA,
IWK and sortimat compared to the second quarter of fiscal
2016.
EBITDA was $25.3 million (10%
EBITDA margin) in the second quarter of fiscal 2017 compared to
$33.7 million (13% EBITDA margin) in
the second quarter of fiscal 2016.
Order Bookings
Second quarter fiscal 2017 Order
Bookings were $289 million, a 26%
increase over the second quarter of fiscal 2016. By customer
market, increased Order Bookings in the life sciences and
transportation markets more than offset lower Order Bookings in the
consumer products & electronics and energy markets.
Included in second quarter fiscal 2017 Order Bookings is an
enterprise program valued at approximately $40 million from an industry leading North
American-based medical device company for the highly automated
manufacturing of their innovative drug delivery device. The
Order Booking includes the design, delivery and installation of a
new manufacturing system which is based on ATS's proprietary
technology. This unique technology facilitates high volume
and reliable manufacturing requirements in a compact
footprint. The Order Booking was made under a master
agreement that provides the framework for an additional potential
follow-on order depending on the success of the customer's
product.
Order Backlog
At October 2,
2016, Order Backlog was $654
million, $65 million or 11%
higher than at September 27, 2015.
Higher Order Backlog in the energy and life sciences markets more
than offset lower Order Backlog in the consumer products &
electronics and transportation markets. Approximately $70 million of period end Order Backlog relates
to a program which was put on hold by a customer subsequent to the
end of the second quarter.
Quarterly Conference Call
ATS' quarterly conference
call begins at 10:00 a.m. eastern on
Wednesday November 9, 2016, and can
be accessed live at www.atsautomation.com or on the phone by
dialing (647) 427-7450 five minutes prior. A replay of the
conference will be available on the ATS website following the call.
Alternatively, a telephone recording of the call will be available
for one week by dialing (416) 849-0833 and entering passcode
10063535 followed by the number sign.
About ATS
ATS is an industry-leading automation
solutions provider to many of the world's most successful
companies. ATS uses its extensive knowledge base and global
capabilities in custom automation, repeat automation, automation
products and value-added services including pre-automation and
after-sales services to address the sophisticated manufacturing
automation systems and service needs of multinational customers in
markets such as life sciences, chemicals, consumer products,
electronics, food, beverage, transportation, energy, and oil and
gas. Founded in 1978, ATS employs approximately 3,500 people at 24
manufacturing facilities and over 50 offices in North America, 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 October 2, 2016
This Management's Discussion and Analysis ("MD&A") for
the three and six months ended October 2,
2016 (second quarter of fiscal 2017) is as of November 8, 2016 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 condensed
consolidated financial statements of the Company for the second
quarter of fiscal 2017 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 the MD&A of the Company for the year ended March 31, 2016 (fiscal 2016) and, accordingly,
the purpose of this document is to provide a fiscal 2017 second
quarter update to the information contained in the fiscal 2016
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 and Additional IFRS
Measures
Throughout this document management uses certain
non-IFRS measures to evaluate the performance of the Company. These
terms do not have any standardized meaning prescribed within IFRS
and therefore may not be comparable to similar measures presented
by other companies. The terms "operating margin", "EBITDA", "EBITDA
margin", "adjusted net income", "adjusted earnings from
operations", "adjusted basic earnings per share", "non-cash working
capital", "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.
Such measures should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
IFRS. In addition, management uses "earnings from operations" which
is an additional IFRS measure to evaluate the performance of the
Company. Earnings from operations is presented on the Company's
consolidated statements of income as net income excluding income
tax expense and net finance costs. Operating margin is an
expression of the Company's earnings from operations as a
percentage of revenues. EBITDA is defined as earnings from
operations excluding depreciation and amortization (which includes
amortization of intangible assets). EBITDA margin is an expression
of the Company's EBITDA as a percentage of revenues. Adjusted
earnings from operations is defined as earnings from operations
before items excluded from management's internal analysis of
operating results, such as amortization expense of
acquisition-related intangible assets, acquisition-related
transaction and integration costs, restructuring charges, and
certain other adjustments which would be non-recurring in nature
("adjustment items"). Adjusted basic earnings per share is defined
as adjusted net income on a basic per share basis, where adjusted
net income is defined as adjusted earnings from operations less net
finance costs and income tax expense, plus tax effects of
adjustment items. Non-cash working capital is defined as the sum of
accounts receivable, costs and earnings in excess of billing on
contracts in progress, inventories, deposits, prepaids and other
assets, less accounts payable, accrued liabilities, provisions and
billings in excess of costs and earnings on contracts in progress.
Order Bookings represent new orders for the supply of automation
systems, services and products that management believes are firm.
Order Backlog is the estimated unearned portion of revenues on
customer contracts that are in process and have not been completed
at the specified date.
Earnings from operations and EBITDA are used by the Company to
evaluate the performance of its operations. Management believes
that earnings from operations is an important indicator in
measuring the performance of the Company's operations on a pre-tax
basis and without consideration as to how the Company finances its
operations. Management believes that EBITDA is an important
indicator of the Company's ability to generate operating cash flows
to fund continued investment in its operations. Management believes
that adjusted earnings from operations and adjusted basic earnings
per share (including adjusted net income) are important measures to
increase comparability of performance between periods. The
adjustment items used by management to arrive at these metrics are
not considered to be indicative of the business' ongoing operating
performance. Management uses the measure non-cash working capital
as a percentage of revenues to evaluate the Company's management of
its investment in non-cash working capital. Management calculates
non-cash working capital as a percentage of revenues using period
end non-cash working capital divided by trailing two fiscal quarter
revenues annualized. Order Bookings provides an indication of
the Company's ability to secure new orders for work during a
specified period, while Order Backlog provides a measure of the
value of Order Bookings that has not been completed at a specified
point in time. Both Order Bookings and Order Backlog are indicators
of future revenues the Company expects to generate based on
contracts that management believes to be firm. Management believes
that ATS shareholders and potential investors in ATS use these
additional IFRS measures and non-IFRS financial measures in making
investment decisions and measuring operational results. EBITDA
should not be construed as a substitute for net income determined
in accordance with IFRS. Adjusted earnings from operations is
not necessarily indicative of earnings from operations or cash
flows from operations as determined under IFRS and may not be
comparable to similar measures presented by other companies.
A reconciliation of (i) earnings from operations and EBITDA to
net income, and (ii) adjusted earnings from operations to earnings
from operations, adjusted net income to net income and adjusted
basic earnings per share to basic earnings per share, in each case
for the three and six month periods ending October 2, 2016 and September 27, 2015, is contained in this MD&A
(see "Reconciliation of Non-IFRS Measures to IFRS Measures"). A
reconciliation of Order Bookings and Order Backlog to total Company
revenues for the three and six month periods ending October 2, 2016 and September 27, 2015 is also contained in the
MD&A (see "Order Backlog Continuity").
COMPANY PROFILE
ATS is an industry-leading automation
solutions provider to many of the world's most successful
companies. ATS uses its extensive knowledge base and global
capabilities in custom automation, repeat automation, automation
products and value-added services including pre-automation and
after-sales services to address the sophisticated manufacturing
automation systems and service needs of multinational customers in
markets such as life sciences, chemicals, consumer products,
electronics, food, beverage, transportation, energy, and oil and
gas. Founded in 1978, ATS employs approximately 3,500 people at 24
manufacturing facilities and over 50 offices in North America, Europe, Southeast
Asia and China.
OVERVIEW –
OPERATING RESULTS
|
Revenues
|
(In millions of
dollars)
|
|
|
Three
Months
Ended
October
2,
|
Three
Months
Ended
September
27,
|
Six
Months
Ended
October
2,
|
Six Months
Ended
September
27,
|
Revenues by
market
|
2016
|
2015
|
2016
|
2015
|
Consumer products
& electronics
|
$
|
28.0
|
$
|
38.4
|
$
|
64.1
|
$
|
75.7
|
Energy
|
47.0
|
21.1
|
112.3
|
39.6
|
Life
sciences
|
97.9
|
109.3
|
192.5
|
216.0
|
Transportation
|
69.6
|
94.9
|
138.9
|
186.7
|
Total
revenues
|
$
|
242.5
|
$
|
263.7
|
$
|
507.8
|
$
|
518.0
|
Second Quarter
Fiscal 2017 second quarter revenues
were 8% lower than in the corresponding period a year ago,
primarily reflecting the timing of project activities. Foreign
exchange rate changes did not materially impact the translation of
revenues earned by foreign-based subsidiaries compared to the
corresponding period a year ago.
By market, fiscal 2017 second quarter revenues from consumer
products & electronics decreased 27%, primarily due to lower
activity in the consumer products market. Revenues generated in the
energy market increased 123% compared to the corresponding period a
year ago, primarily due to higher Order Backlog entering the second
quarter of 2017 compared to a year ago. Revenues generated in the
life sciences market decreased 10% compared to the corresponding
period a year ago, primarily reflecting lower Order Backlog
entering the second quarter of fiscal 2017 compared to a year
ago. Transportation revenues decreased 27% compared to a year
ago primarily due to lower activity compared to a year ago.
Year-to-date
Revenues for the six months ended
October 2, 2016 were 2% lower than in
the corresponding period a year ago, primarily reflecting the
timing of project activities. Foreign exchange rate changes
positively impacted the translation of revenues earned by
foreign-based subsidiaries compared to the corresponding period a
year ago, primarily reflecting the weakening of the Canadian dollar
relative to the U.S. dollar and Euro.
By market, fiscal 2017 year-to-date revenues from consumer
products & electronics decreased 15%, primarily reflecting
lower activity in the consumer products market. Revenues generated
in the energy market increased 184% compared to the corresponding
period a year ago, primarily due to higher Order Backlog entering
fiscal 2017 compared to a year ago. Revenues generated in the
life sciences market decreased 11% compared to the corresponding
period a year ago, primarily reflecting the timing of project
activities and lower Order Backlog at the end of fiscal 2016
compared to the previous year. Transportation revenues decreased
26% compared to a year ago primarily due to lower Order Backlog
entering fiscal 2017 compared to a year ago.
Operating
Results
|
(In millions of
dollars)
|
|
|
Three
Months
Ended
October
2,
2016
|
Three
Months
Ended
September
27,
2015
|
Six
Months
Ended
October
2,
2016
|
Six Months
Ended
September
27,
2015
|
Earnings from
operations
|
$
|
17.3
|
$
|
24.4
|
$
|
39.9
|
$
|
41.9
|
Amortization of
acquisition-related intangible
assets
|
5.0
|
5.6
|
10.3
|
13.3
|
Restructuring
charges
|
─
|
1.7
|
─
|
3.9
|
Adjusted earnings
from operations1
|
$
|
22.3
|
$
|
31.7
|
$
|
50.2
|
$
|
59.1
|
1 See
"Notice to Reader: Non-IFRS Measures and Additional IFRS
Measures."
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
Ended
October
2,
2016
|
Three
Months
Ended
September
27,
2015
|
Six
Months
Ended
October
2,
2016
|
Six Months
Ended
September
27,
2015
|
Earnings from
operations
|
$
|
17.3
|
$
|
24.4
|
$
|
39.9
|
$
|
41.9
|
Depreciation and
amortization
|
8.0
|
9.3
|
16.9
|
20.5
|
EBITDA1
|
$
|
25.3
|
$
|
33.7
|
$
|
56.8
|
$
|
62.4
|
1 See
"Notice to Reader: Non-IFRS Measures and Additional IFRS
Measures."
|
Second Quarter
Fiscal 2017 second quarter earnings
from operations were $17.3 million
(7% operating margin) compared to $24.4
million (9% operating margin) in the second quarter of
fiscal 2016. Excluding $5.0 million
related to amortization of identifiable intangible assets recorded
on the acquisitions of PA, IWK, and sortimat, second quarter fiscal
2017 adjusted earnings from operations were $22.3 million (9% margin). Second quarter fiscal
2016 earnings from operations included $1.7
million of restructuring and severance costs and
$5.6 million related to the
amortization of identifiable intangible assets recorded on the
acquisitions of PA, IWK and sortimat. Excluding these items, last
year's second quarter adjusted earnings from operations were
$31.7 million (12% margin). Lower
adjusted earnings from operations in the most recent period
primarily reflected lower revenues and increased stock compensation
expenses (see "Consolidated Results: Stock-based
compensation.").
Depreciation and amortization expense was $8.0 million in the second quarter of fiscal
2017, compared to $9.3 million a year
ago. The decrease primarily reflected lower amortization of
identifiable intangible assets recorded on the acquisitions of PA,
IWK and sortimat compared to the second quarter of fiscal 2016.
EBITDA was $25.3 million (10%
EBITDA margin) in the second quarter of fiscal 2017 compared to
$33.7 million (13% EBITDA margin) in
the second quarter of fiscal 2016.
Year-to-date
For the six months ended October 2, 2016, earnings from operations were
$39.9 million (8% operating margin)
compared to $41.9 million (8%
operating margin) in the corresponding period a year ago. Excluding
$10.3 million related to amortization
of identifiable intangible assets recorded on the acquisitions of
PA, IWK, and sortimat, adjusted earnings from operations were
$50.2 million (10% operating margin)
in the first six months of fiscal 2017, compared to adjusted
earnings from operations of $59.1
million (11% operating margin) in the corresponding period a
year ago. Lower adjusted earnings from operations primarily
reflected lower revenues, and higher selling, general and
administrative expenses.
Depreciation and amortization expense was $16.9 million in the first six months of fiscal
2017 compared to $20.5 million a year
ago. The decrease primarily reflected lower amortization of
identifiable intangible assets recorded on the acquisitions of PA,
IWK, ATW and sortimat compared to the first six months of fiscal
2016.
Year-to-date fiscal 2017 EBITDA was $56.8
million (11% EBITDA margin) compared to $62.4 million (12% EBITDA margin) in the first
six months of fiscal 2016.
Order Bookings
Second quarter fiscal 2017 Order
Bookings were $289 million, a 26%
increase over the second quarter of fiscal 2016. By customer
market, increased Order Bookings in the life sciences and
transportation markets more than offset lower Order Bookings in the
consumer products & electronics and energy markets.
Included in second quarter fiscal 2017 Order Bookings is an
enterprise program valued at approximately $40 million from an industry leading North
American-based medical device company for the highly automated
manufacturing of their innovative drug delivery device. The
Order Booking includes the design, delivery and installation of a
new manufacturing system which is based on ATS' proprietary
technology. This unique technology facilitates high volume
and reliable manufacturing requirements in a compact
footprint. The Order Booking was made under a master
agreement that provides the framework for an additional potential
follow-on order depending on the success of the customer's
product.
Foreign exchange rate changes did not materially impact the
translation of Order Bookings from foreign-based subsidiaries
compared to the corresponding period a year ago.
Order Backlog
Continuity
|
(In millions of
dollars)
|
|
|
Three
Months
Ended
October
2,
2016
|
Three
Months
Ended
September
27,
2015
|
Six
Months
Ended
October
2,
2016
|
Six Months
Ended
September
27,
2015
|
Opening Order
Backlog
|
$
|
610
|
$
|
590
|
$
|
652
|
$
|
632
|
Revenues
|
(243)
|
(264)
|
(508)
|
(518)
|
Order
Bookings
|
289
|
230
|
528
|
452
|
Order Backlog
adjustments1
|
(2)
|
33
|
(18)
|
23
|
Total2
|
$
|
654
|
$
|
589
|
$
|
654
|
$
|
589
|
1 Order
Backlog adjustments include foreign exchange adjustments and
cancellations.
|
2
Approximately $70 million of Order Backlog as at October 2, 2016
relates to a program which was put on hold by a
customer subsequent to the end of the second quarter of fiscal
2017.
|
Order Backlog by
Market
|
(In millions of
dollars)
|
|
|
|
As
at
|
October 2,
2016
|
September 27,
2015
|
Consumer products
& electronics
|
$
|
81
|
$
|
104
|
Energy
|
95
|
39
|
Life
sciences
|
284
|
244
|
Transportation
|
194
|
202
|
Total1
|
$
|
654
|
$
|
589
|
1
Approximately $70 million of Order Backlog as at October 2, 2016
relates to a program which was put on hold by a
customer subsequent to the end of the second quarter of fiscal
2017.
|
At October 2, 2016, Order Backlog
was $654 million, 11% higher than at
September 27, 2015. Higher Order
Backlog in the energy and life sciences markets more than offset
lower Order Backlog in the consumer products & electronics and
transportation markets. Approximately $70
million of Order Backlog relates to a program which was put
on hold by a customer subsequent to the end of the second
quarter.
Outlook
The global economic environment has continued
to be weak and uncertainty remains. Although certain markets have
shown some recent signs of improvement, many geopolitical risks
remain and growth has remained slow in the U.S., Canadian and
European economies. Economic growth continues to decelerate in
China and other parts of
Asia. A prolonged or more
significant downturn in an economy where the Company operates could
negatively impact Order Bookings and may add to volatility in Order
Bookings.
Many customers remain cautious in their approach to capital
investment. Funnel activity in life sciences has remained strong
and funnel activity in the transportation market has stabilized.
Opportunities in energy markets are sporadic. Funnel activity in
the consumer products & electronics market has improved;
however, it remains low relative to other customer markets.
Overall, the Company's funnel remains significant and proposal
activity is robust; however, conversion of opportunities into Order
Bookings is variable.
The Company's sales organization continues to work to engage
customers on enterprise-type solutions. The Company expects that
this will provide ATS with more strategic relationships, increased
predictability, better program control and less sensitivity to
macroeconomic forces. This approach to market and the timing of
customer decisions on larger opportunities 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.
Due to the approximately $70
million of Order Backlog which is on hold, the Company's
Order Backlog which is available to be completed is approximately
$584 million. In the third quarter of
fiscal 2017, management expects the conversion of the $584 million of Order Backlog to be at the higher
end of the 35% to 40% range. The expected conversion rate of Order
Backlog available to be completed is based on current programs in
Order Backlog and management's estimate of revenues from new Order
Bookings in the quarter. As a result of the program in Order
Backlog which is on hold, the Company expects its utilization and
profitability to be negatively impacted in the third quarter of
fiscal 2017. The program could remain on hold until as late as
mid-December at which time management expects the customer may: (i)
cancel the program outright; (ii) repurpose as much equipment as
possible to a new program; or (iii) re-start the existing program.
Should the program re-start, management does not expect to be able
to complete sufficient work on the program in order to have a
material impact on third quarter revenues and profitability.
In the third quarter of fiscal 2017, management expects to
undertake a review of its global capacity and cost structure.
The Company's efforts to expand its after-sales service offering
is expected to provide some balance to its exposure to the capital
expenditure cycle of its customers. However, the intended
ramp-up of the Company's after-sales service revenues may not
offset capital spending volatility in the short term.
The Company seeks to continue to expand its position in the
global automation market organically and through acquisition. The
Company's solid foundation and strong cash flow generation
capability provide the flexibility to pursue its growth
strategy.
CONSOLIDATED
RESULTS
|
(In millions of
dollars, except per share data)
|
|
|
Three
Months
Ended
October
2,
2016
|
Three
Months
Ended
September
27,
2015
|
Six
Months
Ended
October
2,
2016
|
Six Months
Ended
September
27,
2015
|
Revenues
|
$
|
242.5
|
$
|
263.7
|
$
|
507.8
|
$
|
518.0
|
Cost of
revenues
|
181.8
|
197.2
|
382.3
|
390.5
|
Selling, general, and
administrative
|
41.2
|
42.3
|
82.5
|
83.3
|
Stock-based
compensation
|
2.2
|
(0.2)
|
3.1
|
2.3
|
Earnings from
operations
|
$
|
17.3
|
$
|
24.4
|
$
|
39.9
|
$
|
41.9
|
Net finance
costs
|
6.4
|
7.4
|
13.0
|
11.8
|
Provision for income
taxes
|
2.4
|
4.2
|
6.3
|
7.5
|
Net
income
|
$
|
8.5
|
$
|
12.8
|
$
|
20.6
|
$
|
22.6
|
Basic and diluted
earnings per share
|
$
|
0.09
|
$
|
0.14
|
$
|
0.22
|
$
|
0.25
|
Revenues. At $242.5
million, consolidated revenues for the second quarter of
fiscal 2017 were $21.2 million or 8%
lower than the corresponding period a year ago. At $507.8 million, year-to-date revenues were
$10.2 million or 2% lower than in the
corresponding period a year ago. See "Overview – Operating
Results."
Cost of revenues. At $181.8
million, second quarter fiscal 2017 cost of revenues
decreased compared to the corresponding period a year ago by
$15.4 million or 8%. Year-to-date
cost of revenues of $382.3 million
decreased $8.2 million or 2%,
primarily due to lower revenues. Gross margin was 25% for the
second quarter of fiscal 2017 and the second quarter of fiscal
2016. Year-to-date gross margin was 25% for both fiscal 2017 and
fiscal 2016.
Selling, general and administrative ("SG&A")
expenses. SG&A expenses for the second quarter of
fiscal 2017 were $41.2 million, which
included $5.0 million of expenses
related to the amortization of identifiable intangible assets
recorded on the acquisitions of PA, IWK, and sortimat. Excluding
these costs, SG&A expenses were $36.2
million in the second quarter of fiscal 2017. Comparably,
SG&A expenses for the second quarter of fiscal 2016 were
$35.0 million, which excluded
$5.6 million of expenses related to
the amortization of identifiable intangible assets recorded on the
acquisitions of PA, IWK, ATW and sortimat, and $1.7 million of restructuring and severance
costs. Higher SG&A expenses in the second quarter of fiscal
2017 primarily reflected higher professional fees and recruiting
costs.
For the six months ended October 2,
2016, SG&A expenses were $82.5
million, which included $10.3
million of expenses related to the amortization of
identifiable intangible assets recorded on the acquisitions of PA,
IWK, ATW and sortimat. Excluding these costs, SG&A expenses
were $72.2 million for the six months
ended October 2, 2016. Comparably,
SG&A expenses for the six months ended September 27, 2015 were $66.1 million, which excluded $13.3 million of expenses related to the
amortization of identifiable intangible assets recorded on the
acquisitions of PA, IWK, ATW and sortimat, and $3.9 million of restructuring and severance
costs. Higher SG&A expenses primarily reflected higher
professional fees, recruiting costs and foreign exchange rate
changes which increased the translation of reported SG&A
expenses of foreign-based subsidiaries due to the weakening of the
Canadian dollar relative to the U.S. dollar and Euro.
Stock-based compensation. Stock-based compensation
expense amounted to $2.2 million in
the second quarter of fiscal 2017 compared to a recovery of
$0.2 million in the corresponding
period a year ago. For the six month period ended October 2, 2016, stock-based compensation expense
increased to $3.1 million from
$2.3 million a year earlier. The
increase in stock-based compensation costs was attributable to
higher expenses from stock options and the revaluation of deferred
stock units, share appreciation rights, and restricted share
units.
Earnings from operations. For the three and six month
periods ended October 2, 2016,
consolidated earnings from operations were $17.3 million (7% operating margin) and
$39.9 million (8% operating margin)
respectively, compared to earnings from operations of $24.4 million (9% operating margin) and
$41.9 million (8% operating margin)
million in the corresponding periods a year ago. See
"Overview – Operating Results."
Net finance costs. Net finance costs were
$6.4 million in the second quarter of
fiscal 2017, $1.0 million lower than
the corresponding period a year ago. The decrease was primarily due
to the benefit of cross currency interest rate swaps, which were
entered into in the fourth quarter of fiscal 2016 (see "Foreign
Exchange"). For the six months ended October 2, 2016, finance costs were $13.0 million compared to $11.8 million in the corresponding period a year
ago. The increase reflected interest on the Company's Senior Notes,
which were issued in June 2015 (See
"Liquidity, Cash Flow and Financial Resources").
Income tax provision. For the three and six months ended
October 2, 2016, the Company's
effective income tax rate of 22% and 23% respectively, differed
from the combined Canadian basic federal and provincial income tax
rate of 27% primarily as a result of income earned in certain
jurisdictions with different statutory tax rates. The Company
expects its effective tax rate to continue to be in the range of
25%.
Net income. Fiscal 2017 second quarter net income was
$8.5 million (9 cents per share basic and diluted) compared to
$12.8 million (14 cents per share basic and diluted) for the
second quarter of fiscal 2016. Adjusted basic earnings per
share were 13 cents in the second
quarter of fiscal 2017 compared to 19
cents for the second quarter of fiscal 2016. See
"Reconciliation of Non-IFRS Measures to IFRS Measures."
Net income for the six months ended October 2, 2016, was $20.6
million (22 cents per share
basic and diluted) compared to $22.6
million (25 cents per share
basic and diluted) for the corresponding period a year ago.
Adjusted basic earnings per share were 30
cents in the six months ended October
2, 2016 compared to 37 cents
in the corresponding period a year ago. See "Reconciliation
of Non-IFRS Measures to IFRS Measures."
Reconciliation of Non-IFRS Measures to IFRS
Measures
(In millions of dollars, except per share data)
The following tables reconcile EBITDA to the most directly
comparable IFRS measure (net income):
|
Three
Months
Ended
October
2,
2016
|
Three
Months
Ended
September
27,
2015
|
EBITDA
|
$
|
25.3
|
$
|
33.7
|
Less: depreciation
and amortization expense
|
8.0
|
9.3
|
Earnings from
operations
|
$
|
17.3
|
$
|
24.4
|
Less: net finance
costs
|
6.4
|
7.4
|
Provision for income
taxes
|
2.4
|
4.2
|
Net
income
|
$
|
8.5
|
$
|
12.8
|
|
|
|
|
|
|
|
Six
Months
Ended
October
2,
2016
|
Six Months
Ended
September
27,
2015
|
EBITDA
|
$
|
56.8
|
$
|
62.4
|
Less: depreciation
and amortization expense
|
16.9
|
20.5
|
Earnings from
operations
|
$
|
39.9
|
$
|
41.9
|
Less: net finance
costs
|
13.0
|
11.8
|
Provision for income
taxes
|
6.3
|
7.5
|
Net
income
|
$
|
20.6
|
$
|
22.6
|
The following tables reconcile adjusted earnings from operations
and adjusted basic earnings per share to the most directly
comparable IFRS measures (net income and basic earnings per share
respectively):
|
Three Months
Ended
October 2,
2016
|
Three Months
Ended
September 27,
2015
|
|
IFRS
|
Adjustments
|
Adjusted
(non-IFRS)
|
IFRS
|
Adjustments
|
Adjusted
(non-IFRS)
|
Earnings from
operations
|
$
|
17.3
|
$
|
─
|
$
|
17.3
|
$
|
24.4
|
$
|
─
|
$
|
24.4
|
Amortization of
acquisition-related intangible
assets
|
|
─
|
|
5.0
|
|
5.0
|
|
─
|
|
5.6
|
|
5.6
|
Restructuring
Charges
|
|
─
|
|
─
|
|
─
|
|
─
|
|
1.7
|
|
1.7
|
|
$
|
17.3
|
$
|
5.0
|
$
|
22.3
|
$
|
24.4
|
$
|
7.3
|
$
|
31.7
|
Less: net finance
costs
|
$
|
6.4
|
$
|
─
|
$
|
6.4
|
$
|
7.4
|
$
|
─
|
$
|
7.4
|
Income before
income taxes
|
$
|
10.9
|
$
|
5.0
|
$
|
15.9
|
$
|
17.0
|
$
|
7.3
|
$
|
24.3
|
Provision for income
taxes
|
$
|
2.4
|
$
|
─
|
$
|
2.4
|
$
|
4.2
|
$
|
─
|
$
|
4.2
|
Adjustment to
provision for income
taxes1
|
|
─
|
|
1.5
|
|
1.5
|
|
─
|
|
2.3
|
|
2.3
|
|
$
|
2.4
|
$
|
1.5
|
$
|
3.9
|
$
|
4.2
|
$
|
2.3
|
$
|
6.5
|
Net
income
|
$
|
8.5
|
$
|
3.5
|
$
|
12.0
|
$
|
12.8
|
$
|
5.0
|
$
|
17.8
|
Basic earnings per
share
|
$
|
0.09
|
$
|
0.04
|
$
|
0.13
|
$
|
0.14
|
$
|
0.05
|
$
|
0.19
|
1
Adjustments to provision for income taxes relate to the income tax
effects of adjustment items that are excluded for the purposes of
calculating non-IFRS based adjusted net income.
|
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
October 2,
2016
|
Six Months
Ended
September 27,
2015
|
|
IFRS
|
Adjustments
|
Adjusted
(non-IFRS)
|
IFRS
|
Adjustments
|
Adjusted
(non-IFRS)
|
Earnings from
operations
|
$
|
39.9
|
$
|
─
|
$
|
39.9
|
$
|
41.9
|
$
|
─
|
$
|
41.9
|
Amortization of
acquisition-related intangible
assets
|
|
─
|
|
10.3
|
|
10.3
|
|
─
|
|
13.3
|
|
13.3
|
Restructuring
Charges
|
|
─
|
|
─
|
|
─
|
|
─
|
|
3.9
|
|
3.9
|
|
$
|
39.9
|
$
|
10.3
|
$
|
50.2
|
$
|
41.9
|
$
|
17.2
|
$
|
59.1
|
Less: net finance
costs
|
$
|
13.0
|
$
|
─
|
$
|
13.0
|
$
|
11.8
|
$
|
─
|
$
|
11.8
|
Income before
income taxes
|
$
|
26.9
|
$
|
10.3
|
$
|
37.2
|
$
|
30.1
|
$
|
17.2
|
$
|
47.3
|
Provision for income
taxes
|
$
|
6.3
|
$
|
─
|
$
|
6.3
|
$
|
7.5
|
$
|
─
|
$
|
7.5
|
Adjustment to
provision for income
taxes1
|
|
─
|
|
3.2
|
|
3.2
|
|
─
|
|
5.3
|
|
5.3
|
|
$
|
6.3
|
$
|
3.2
|
$
|
9.5
|
$
|
7.5
|
$
|
5.3
|
$
|
12.8
|
Net
income
|
$
|
20.6
|
$
|
7.1
|
$
|
27.7
|
$
|
22.6
|
$
|
11.9
|
$
|
34.5
|
Basic earnings per
share
|
$
|
0.22
|
$
|
0.08
|
$
|
0.30
|
$
|
0.25
|
$
|
0.12
|
$
|
0.37
|
1
Adjustments to provision for income taxes relate to the income tax
effects of adjustment items that are excluded for the purposes of
calculating non-IFRS based adjusted net income.
|
LIQUIDITY, CASH
FLOW AND FINANCIAL RESOURCES
|
(In millions of
dollars, except ratios)
|
|
As at
|
October
2,
2016
|
March 31,
2016
|
Cash and cash
equivalents
|
$
|
226.6
|
$
|
170.0
|
Debt-to-equity
ratio
|
0.54:1
|
0.56:1
|
|
|
|
|
|
|
For the three months
ended
|
October
2,
2016
|
September
27,
2015
|
Cash flows provided
by (used in) operating activities
|
$
|
3.8
|
$
|
(20.3)
|
At October 2, 2016, the Company
had cash and cash equivalents of $226.6
million compared to $170.0
million at March 31, 2016. At
October 2, 2016, the Company's
debt-to-total-equity ratio was 0.54:1.
At October 2, 2016, the Company
had $642.4 million of unutilized
multipurpose credit, including letters of credit, available under
existing credit facilities and another $2.5
million available under letter of credit facilities.
In three months ended October 2,
2016, cash flows provided by operating activities were
$3.8 million ($20.3 million used in operating activities in the
second quarter a year ago). The increase in operating cash flows
related primarily to the timing of investments in non-cash working
capital in large customer programs. In the six months ended
October 2, 2016, cash flows provided
by operating activities were $61.3
million ($29.5 million used in
operating activities in the corresponding period a year ago). The
increase in operating cash flows related primarily to the timing of
investments in non-cash working capital in large customer
programs.
In the second quarter of fiscal 2017, the Company's investment
in non-cash working capital increased by $14.3 million from July 3,
2016. On a year-to-date basis, investment in non-cash
working capital decreased $22.3
million. Accounts receivable decreased 19% or $36.9 million compared to March 31, 2016 due to timing of billings on
certain customer contracts and improved collections. Net contracts
in progress decreased 4% or $3.4
million compared to March 31,
2016 due to timing of program activity. The Company actively
manages its accounts receivable and net contracts in progress
balances through billing terms on long-term contracts, collection
efforts and supplier payment terms. Inventories increased 6% or
$2.5 million compared to March 31, 2016 primarily due to the timing of
inventory purchases. Deposits and prepaid assets increased 48% or
$10.7 million compared to
March 31, 2016 due to the timing of
program execution. Accounts payable and accrued liabilities were
flat. Provisions decreased 5% or $0.9
million compared to March 31,
2016.
Capital expenditures totalled $4.3
million for the first six months of fiscal 2017, primarily
related to computer hardware.
Intangible assets expenditures were $3.3
million for the first six months of fiscal 2017, primarily
related to computer software and various internal development
projects.
The Company's U.S. $250.0 million
aggregate principal amount of senior notes (the "Senior Notes") are
unsecured, were issued at par, bear interest at a rate of 6.50% per
annum, and mature on June 15,
2023. The Company may redeem the Senior Notes, in whole at
any time or in part from time to time, at specified redemption
prices and subject to certain conditions required by the Senior
Notes. If the Company experiences a change of control, the
Company may be required to repurchase the Senior Notes, in whole or
in part, at a purchase price equal to 101% of the aggregate
principal amount of the Senior Notes, plus accrued and unpaid
interest, if any, to, but not including, the redemption date.
The Senior Notes contain customary covenants that restrict, subject
to certain exceptions and thresholds, some of the activities of the
Company and its subsidiaries, including the Company's ability to
dispose of assets, incur additional debt, pay dividends, create
liens, make investments, and engage in specified transactions with
affiliates. Subject to certain exceptions, the Senior Notes
will be guaranteed by each of the subsidiaries of the Company that
is a borrower or has guaranteed obligations under the Credit
Facility. Transaction fees of $7.2
million were deferred and are being amortized over the term
of the Senior Notes.
The Company's senior secured credit facility (the "Credit
Facility") provides a committed revolving credit facility of
$750.0 million. The Credit
Facility is secured by (i) the Company's assets, including real
estate; (ii) assets, including certain real estate, of certain of
the Company's North American subsidiaries; and (iii) a pledge of
shares of certain of the Company's non-North American
subsidiaries. Certain of the Company's subsidiaries also
provide guarantees under the Credit Facility. At October 2, 2016 the Company had utilized
$111.2 million under the Credit
Facility by way of letters of credit (March
31, 2016 - $115.1
million). The Credit Facility matures on August 29, 2018.
The Credit Facility is available in Canadian dollars by way of
prime rate advances and/or bankers' acceptances, in U.S. dollars by
way of base rate advances and/or LIBOR advances, in Swiss francs,
Euros and British pounds sterling by way of LIBOR advances and by
way of letters of credit for certain purposes in Canadian dollars,
U.S. dollars and Euros. The interest rates applicable to the
Credit Facility are determined based on a debt to EBITDA ratio as
defined in the Credit Facility. 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 a margin ranging
from 0.45% to 2.00%. For bankers' acceptances and LIBOR
advances, the interest rate is equal to the bankers' acceptance fee
or the LIBOR, respectively, plus a margin that varies from 1.45% to
3.00%. The Company pays a fee for usage of financial letters
of credit which ranges from 1.45% to 3.00% and a fee for usage of
non-financial letters of credit which ranges from 0.97% to
2.00%. The Company pays a standby fee on the unadvanced
portions of the amounts available for advance or draw-down under
the Credit Facility at rates ranging from 0.29% to 0.68%.
The Credit Facility is subject to a debt to EBITDA test and an
interest coverage test. Under the terms of the Credit
Facility, the Company is restricted from encumbering any assets
with certain permitted exceptions. The Credit Facility also
limits advances to subsidiaries and partially restricts the Company
from repurchasing its common shares and paying dividends. At
October 2, 2016, all of the covenants
were met.
The Company has additional credit facilities available of
$12.6 million (3.5 million Euro, 275.0
million Indian Rupees, 50.0 million
Thai Baht and 1.2 million Czech Koruna). The total amount
outstanding on these facilities at October
2, 2016 was $9.2 million, of
which $2.1 million was classified as
bank indebtedness (March 31, 2016 -
$2.3 million) and $7.1 million was classified as long-term debt
(March 31, 2016 - $7.1 million). The interest rates applicable to
the credit facilities range from 1.66% to 10.00% per annum. A
portion of the long-term debt is secured by certain assets of the
Company. The 275.0 million Indian
Rupees and the 50.0 million Thai
Baht credit facilities are secured by letters of credit
under the Credit Facility.
Over the long term, the Company generally expects to continue
increasing its overall investment in non-cash working capital to
support the growth of its business, with fluctuations on a
quarter-over-quarter basis. The Company's goal is to maintain its
investment in non-cash working capital as a percentage of
annualized revenues at a level below 15%. 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 non-cash 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 continue to use leverage to support its growth
strategy.
Contractual Obligations
(In millions of dollars)
The Company's minimum operating lease payments (related
primarily to facilities and equipment) and purchase obligations are
as follows:
|
Operating
Leases
|
Purchase
Obligations
|
Less than one
year
|
$
|
10.3
|
$
|
75.5
|
One – two
years
|
8.5
|
3.3
|
Two – three
years
|
7.4
|
0.1
|
Three – four
years
|
6.5
|
0.1
|
Four – five
years
|
5.9
|
––
|
Due in over five
years
|
6.5
|
––
|
|
$
|
45.1
|
$
|
79.0
|
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 commitments for material
purchases.
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 letters of credit as security for advances
received from customers pending delivery and contract performance.
In addition, the Company provides letters of credit for
post-retirement obligations and may provide letters of credit as
security on equipment under lease and on order. At
October 2, 2016, the total value of
outstanding letters of credit was approximately $131.5 million (March 31,
2016 - $137.0 million).
In the normal course of operations, the Company is party to a
number of lawsuits, claims and contingencies. Although it is
possible that liabilities may be incurred in instances for which no
accruals have been made, the Company does not believe that the
ultimate outcome of these matters will have a material impact on
its consolidated financial position.
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 7 of the
interim condensed 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 market or
geographic region represents significant credit risk. Credit risk
concentration with respect to trade receivables is mitigated as the
Company primarily serves large, multinational customers and obtains
insurance in certain instances.
During the first six months of fiscal 2017, 272,250 stock
options were exercised. At November 8,
2016 the total number of shares outstanding was
92,565,609 and there were 3,442,116 stock options
outstanding to acquire common shares of the Company.
Normal Course Issuer Bid
On November 4, 2015, the Company announced that the
Toronto Stock Exchange ("TSX") had accepted a notice filed by the
Company of its intention to make a normal course issuer bid
("NCIB"). Under the NCIB, ATS had the ability to purchase for
cancellation up to a maximum of 4,600,000 common shares,
representing approximately 5% of the 92,541,582 common shares that
were issued and outstanding as of October
31, 2015.
During fiscal 2016, the Company purchased 481,473 common shares
for $6.0 million under the NCIB. The
weighted average price per share repurchased was $12.45. No subsequent purchases were made in
fiscal 2017. The NCIB expired on November 5,
2016.
RELATED PARTY TRANSACTIONS
The Company has an
agreement with a shareholder, Mason Capital Management, LLC ("Mason
Capital"), pursuant to which Mason Capital has agreed to provide
ATS with ongoing strategic and capital markets advisory services
for an annual fee of U.S. $0.5
million. As part of the agreement, a member of the
Company's Board of Directors who is associated with Mason Capital
has waived any fees to which he may have otherwise been entitled
for serving as a member of the Board of Directors or as a member of
any committee of the Board of Directors.
There were no other significant related party transactions
during the first six months of fiscal 2017.
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, through borrowings
made by the Company in currencies other than its functional
currency and through its investments in its foreign-based
subsidiaries.
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
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.
The Company uses cross-currency swaps as derivative financial
instruments to hedge a portion of its foreign exchange risk related
to its U.S.-dollar-denominated Senior Notes. On March 29, 2016 the Company entered into a
cross-currency interest rate swap instrument to swap U.S.
$150.0 million into Canadian
dollars. The Company will receive interest of 6.50% U.S. per
annum and pay interest of 6.501% Canadian. The terms of the
hedging relationship will end on June 15,
2023.
The Company manages foreign exchange risk on its
Euro-denominated net investments. The Company uses a
cross-currency swap as derivative financial instruments to hedge a
portion of the foreign exchange risk related to its
Euro-denominated net investment. On March 29, 2016, the Company entered into a
cross-currency swap instrument to swap 134.1
million Euro into Canadian dollars. The Company will
receive interest of 6.501% Canadian per annum and pay interest of
5.094% Euro. The terms of the hedging relationship will end
on June 15, 2023. As a result of the
cross-currency interest rate swap instruments, the Company expects
its interest expenses to be reduced by approximately U.S.
$2 million per annum from the coupon
rate of the Senior Notes.
In addition, from time to time, the Company may hedge the
foreign exchange risk arising from foreign currency debt,
intercompany loans, net investments in foreign-based subsidiaries
and committed acquisitions through the use of forward foreign
exchange contracts or other non-derivative financial instruments.
The Company uses hedging as a risk management tool, not to
speculate. See note 7 to the interim condensed consolidated
financial statements for details on the derivative financial
instruments outstanding at October 2,
2016.
Period average
exchange rates in CDN$
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
October
2,
2016
|
September
27,
2015
|
% change
|
October
2,
2016
|
September
27,
2015
|
% change
|
U.S.
Dollar
|
1.3047
|
1.3071
|
(0.2%)
|
1.2965
|
1.2679
|
2.3%
|
Euro
|
1.4573
|
1.4547
|
0.2%
|
1.4564
|
1.4073
|
3.5%
|
CONSOLIDATED
QUARTERLY RESULTS
|
(In millions of
dollars, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
Q2
|
Q1
|
Q4
|
Q3
|
Q2
|
Q1
|
Q4
|
Q3
|
|
2017
|
2017
|
2016
|
2016
|
2016
|
2016
|
2015
|
2015
|
|
|
|
|
|
|
|
|
|
Revenues from
continuing
operations
|
$
|
242.5
|
$
|
265.4
|
$
|
246.8
|
$
|
274.9
|
$
|
263.7
|
$
|
254.3
|
$
|
289.4
|
$
|
248.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from
operations
|
$
|
17.3
|
$
|
22.6
|
$
|
8.1
|
$
|
26.8
|
$
|
24.4
|
$
|
17.5
|
$
|
22.6
|
$
|
15.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
from
operations
|
$
|
22.3
|
$
|
27.9
|
$
|
23.2
|
$
|
32.1
|
$
|
31.7
|
$
|
27.4
|
$
|
34.7
|
$
|
27.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing
operations
|
$
|
8.5
|
$
|
12.1
|
$
|
1.4
|
$
|
15.5
|
$
|
12.8
|
$
|
9.8
|
$
|
13.9
|
$
|
8.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
from
discontinued operations
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
2.2
|
$
|
(0.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
8.5
|
$
|
12.1
|
$
|
1.4
|
$
|
15.5
|
$
|
12.8
|
$
|
9.8
|
$
|
16.1
|
$
|
8.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
earnings per
share from continuing
operations
|
$
|
0.09
|
$
|
0.13
|
$
|
0.02
|
$
|
0.16
|
$
|
0.14
|
$
|
0.11
|
$
|
0.15
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted basic
earnings per
share from continuing
operations
|
$
|
0.13
|
$
|
0.17
|
$
|
0.14
|
$
|
0.21
|
$
|
0.19
|
$
|
0.18
|
$
|
0.24
|
$
|
0.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
earnings
(loss) per share from
discontinued operations
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
0.03
|
$
|
(0.00)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
earnings per
share
|
$
|
0.09
|
$
|
0.13
|
$
|
0.02
|
$
|
0.16
|
$
|
0.14
|
$
|
0.11
|
$
|
0.18
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Order
Bookings
|
$
|
289.0
|
$
|
239.0
|
$
|
390.0
|
$
|
228.0
|
$
|
230.0
|
$
|
222.0
|
$
|
317.0
|
$
|
287.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Order
Backlog(1)
|
$
|
654.0
|
$
|
610.0
|
$
|
652.0
|
$
|
546.0
|
$
|
589.0
|
$
|
590.0
|
$
|
632.0
|
$
|
602.0
|
1
Approximately $70 million of Order Backlog as at October 2, 2016
relates to a program which was put on hold by a customer subsequent
to the end of the second quarter of fiscal 2017.
|
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.
Operating performance quarter to quarter may also be affected by
the timing of revenue recognition on large programs in Order
Backlog, which is impacted by such factors as customer delivery
schedules, the timing of third-party content and by the timing of
acquisitions. General economic trends, product life cycles and
product changes may impact revenues and operating
performance. ATS typically experiences some seasonality with
its Order Bookings, revenues and earnings from operations due to
summer plant shutdowns by its customers.
CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
The
preparation of the Company's consolidated financial statements
requires management to make estimates, judgments 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, judgments 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 described in the Company's fiscal 2016
MD&A.
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 (2013) 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 system's objectives will be met.
During the three and six months ended October 2, 2016, there have been no changes in
the design of 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 may 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: potential impact of
general economic environment, including impact on Order Bookings;
activity in the markets that the Company serves; the engagement
with customers on enterprise solutions providing ATS with more
strategic relationships, increased predictability, better program
control and less sensitivity to macroeconomic forces; the expected
impact of the sales organization's approach to market on Order
Bookings, performance period, and timing of revenue recognition;
the rate of completion of Order Backlog available to be completed;
management's expectation of impact of the program that is on hold
on utilization and profitability; expectation as to how long such
project is to remain on hold, potential outcomes, and impact on
third quarter revenues and profitability; expected review of global
capacity and cost structure; the Company's efforts to expand
after-sales services and the expected impact; the Company's
strategy to expand organically and through acquisition; the
Company's expectation with respect to effective tax rate; the
Company's goal with respect to non-cash working capital as a
percentage of revenues; expectation in relation to meeting funding
requirements for investments; expectation to use leverage to
support growth strategy; the Company's belief with respect to the
outcome of certain lawsuits, claims and contingencies; and the
Company's expectation with respect to a reduction of interest
expense resulting from an interest rate swap. The risks and
uncertainties that may affect forward-looking statements include,
among others: impact of the global economy; general market
performance including capital market conditions and availability
and cost of credit; performance of the markets 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; timing of customer decisions related to large
enterprise programs and potential for greater negative impact
associated with any cancellations or non-performance in relation
thereto; variations in the amount of Order Backlog completed in any
given quarter; that revenues from after-sales services are
insufficient to offset capital spending volatility; 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; or to raise, through debt or equity, or otherwise
have available, required capital; that acquisitions made are not
integrated as quickly or effectively as planned or expected and, as
a result, anticipated benefits and synergies are not realized; that
the effective tax rate is other than expected, due to reasons
including income spread among jurisdictions being other than
anticipated; non-cash working capital as a percentage of revenues
operating at a level other than as expected due to reasons,
including, the timing and nature of Order Bookings, the timing of
payment milestones and payment terms in customer contracts, and
delays in customer programs; risk that the ultimate outcome of
lawsuits, claims, and contingencies give rise to material
liabilities for which no accruals have been made; that one or more
customers, or other entities 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' 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
|
October 2
2016
|
March
31 2016
|
|
|
|
|
ASSETS
|
9
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
|
$
|
226,638
|
$
|
170,034
|
Accounts
receivable
|
|
159,027
|
195,911
|
Costs and earnings in
excess of billings on contracts in progress
|
4
|
185,798
|
202,694
|
Inventories
|
4
|
48,747
|
46,200
|
Deposits, prepaids
and other assets
|
5
|
33,044
|
22,324
|
|
|
653,254
|
637,163
|
Non-current
assets
|
|
|
|
Property, plant and
equipment
|
|
70,680
|
71,060
|
Other
assets
|
6, 7
|
5,654
|
4,211
|
Goodwill
|
|
434,588
|
431,747
|
Intangible
assets
|
|
167,771
|
177,065
|
Deferred income tax
assets
|
|
2,881
|
2,534
|
Investment tax credit
receivable
|
|
46,474
|
43,683
|
|
|
728,048
|
730,300
|
Total
assets
|
|
$
|
1,381,302
|
$
|
1,367,463
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Bank
indebtedness
|
9
|
$
|
2,104
|
$
|
2,319
|
Accounts payable and
accrued liabilities
|
|
178,391
|
178,826
|
Provisions
|
8
|
19,334
|
20,267
|
Billings in excess of
costs and earnings on contracts in progress
|
4
|
112,595
|
126,127
|
Current portion of
long-term debt
|
9
|
5,533
|
5,259
|
|
|
317,957
|
332,798
|
Non-current
liabilities
|
|
|
|
Employee
benefits
|
|
28,329
|
28,252
|
Long-term
debt
|
9
|
320,386
|
316,120
|
Deferred income tax
liabilities
|
|
41,207
|
39,740
|
Other long-term
liabilities
|
7
|
1,067
|
––
|
|
|
390,989
|
384,112
|
Total
liabilities
|
|
$
|
708,946
|
$
|
716,910
|
|
|
|
|
Commitments and
contingencies
|
9, 13
|
|
|
|
|
|
|
EQUITY
|
|
|
|
Share
capital
|
10
|
$
|
530,976
|
$
|
528,184
|
Contributed
surplus
|
|
13,889
|
13,201
|
Accumulated other
comprehensive income
|
|
66,364
|
68,319
|
Retained
earnings
|
|
60,883
|
40,634
|
Equity attributable
to shareholders
|
|
672,112
|
650,338
|
Non-controlling
interests
|
|
244
|
215
|
Total
equity
|
|
672,356
|
650,553
|
Total liabilities
and equity
|
|
$
|
1,381,302
|
$
|
1,367,463
|
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
|
October 2
2016
|
September 27
2015
|
October 2
2016
|
September 27
2015
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
Revenues from
construction contracts
|
|
$
|
144,695
|
$
|
158,984
|
$
|
309,635
|
$
|
310,434
|
|
Sale of
goods
|
|
20,206
|
20,061
|
38,790
|
40,450
|
|
Services
rendered
|
|
77,587
|
84,663
|
159,415
|
167,088
|
|
|
|
|
|
|
Total
revenues
|
|
242,488
|
263,708
|
507,840
|
517,972
|
|
|
|
|
|
|
Operating costs and
expenses
|
|
|
|
|
|
|
Cost of
revenues
|
|
181,786
|
197,200
|
382,343
|
390,501
|
|
Selling, general and
administrative
|
|
41,219
|
42,300
|
82,547
|
83,251
|
|
Stock-based
compensation
|
12
|
2,219
|
(190)
|
3,088
|
2,354
|
|
|
|
|
|
|
Earnings from
operations
|
|
17,264
|
24,398
|
39,862
|
41,866
|
|
|
|
|
|
|
Net finance
costs
|
15
|
6,339
|
7,424
|
12,979
|
11,770
|
|
|
|
|
|
|
Income before
income taxes
|
|
10,925
|
16,974
|
26,883
|
30,096
|
|
|
|
|
|
|
Income tax
expense
|
11
|
2,452
|
4,156
|
6,309
|
7,430
|
|
|
|
|
|
|
Net
income
|
|
$
|
8,473
|
$
|
12,818
|
$
|
20,574
|
$
|
22,666
|
|
|
|
|
|
|
Attributable
to
|
|
|
|
|
|
Shareholders
|
|
$
|
8,451
|
$
|
12,811
|
$
|
20,545
|
$
|
22,650
|
Non-controlling
interests
|
|
22
|
7
|
29
|
16
|
|
|
$
|
8,473
|
$
|
12,818
|
$
|
20,574
|
$
|
22,666
|
|
|
|
|
|
|
Earnings per share
attributable to
|
|
|
|
|
|
|
shareholders
|
16
|
|
|
|
|
Basic and
diluted
|
|
$
|
0.09
|
$
|
0.14
|
$
|
0.22
|
$
|
0.25
|
ATS AUTOMATION
TOOLING SYSTEMS INC.
|
Interim
Consolidated Statements of Comprehensive Income
|
(in thousands of
Canadian dollars - unaudited)
|
|
|
Three months
ended
|
Six months
ended
|
|
October 2
2016
|
September 27
2015
|
October
2
2016
|
September 27
2015
|
|
|
|
|
|
Net income
|
$
|
8,473
|
$
|
12,818
|
$
|
20,574
|
$
|
22,666
|
|
|
|
|
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
|
|
|
Items to be
reclassified subsequently to net income:
|
|
|
|
|
|
|
|
|
|
|
Currency translation
adjustment
|
4,872
|
41,451
|
(1,683)
|
36,775
|
(net of
income taxes of $nil)
|
|
|
|
|
|
|
Net unrealized loss
on derivative financial
|
(849)
|
(1,544)
|
(1,462)
|
(963)
|
instruments designated as cash flow hedges
|
|
Tax impact
|
207
|
389
|
390
|
227
|
|
|
|
|
|
|
Loss (gain)
transferred to net income for derivatives
|
(20)
|
660
|
(330)
|
1,801
|
designated as cash flow hedges
|
|
Tax impact
|
(1)
|
(160)
|
77
|
(452)
|
|
|
|
|
|
|
Cash flow hedge
reserve adjustment
|
1,772
|
––
|
1,404
|
––
|
|
Tax impact
|
(443)
|
––
|
(351)
|
––
|
|
|
|
|
|
Other
comprehensive income (loss)
|
5,538
|
40,796
|
(1,955)
|
37,388
|
|
|
|
|
|
Comprehensive
income
|
$
|
14,011
|
$
|
53,614
|
$
|
18,619
|
$
|
60,054
|
|
|
|
|
|
Attributable
to
|
|
|
|
|
Shareholders
|
$
|
13,989
|
$
|
53,607
|
$
|
18,590
|
$
|
60,038
|
Non-controlling
interests
|
22
|
7
|
29
|
16
|
|
$
|
14,011
|
$
|
53,614
|
$
|
18,619
|
$
|
60,054
|
ATS AUTOMATION
TOOLING SYSTEMS INC.
|
Interim
Consolidated Statements of Changes in Equity
|
(in thousands of
Canadian dollars - unaudited)
|
|
Six months ended
October 2, 2016
|
|
|
|
|
|
|
|
|
|
Share
capital
|
Contributed
surplus
|
Retained
earnings
|
Currency
translation
adjustments
|
Cash
flow
hedge reserve
|
Total
accumulated
other
comprehensive
income
|
Non-
controlling
interests
|
Total
equity
|
|
|
|
|
|
|
|
|
|
Balance, as at
March 31, 2016
|
$
|
528,184
|
$
|
13,201
|
$
|
40,634
|
$
|
66,482
|
$
|
1,837
|
$
|
68,319
|
$
|
215
|
$
|
650,553
|
|
|
|
|
|
|
|
|
|
Net income
|
––
|
––
|
20,545
|
––
|
––
|
––
|
29
|
20,574
|
Other comprehensive
loss
|
––
|
––
|
––
|
(1,683)
|
(272)
|
(1,955)
|
––
|
(1,955)
|
Total comprehensive
income (loss)
|
––
|
––
|
20,545
|
(1,683)
|
(272)
|
(1,955)
|
29
|
18,619
|
|
|
|
|
|
|
|
|
|
Non-controlling
interests
|
––
|
––
|
(296)
|
––
|
––
|
––
|
––
|
(296)
|
Stock-based
compensation
|
––
|
1,176
|
––
|
––
|
––
|
––
|
––
|
1,176
|
Exercise of stock
options
|
2,792
|
(488)
|
––
|
––
|
––
|
––
|
––
|
2,304
|
|
|
|
|
|
|
|
|
|
Balance, as at
October 2, 2016
|
$
|
530,976
|
$
|
13,889
|
$
|
60,883
|
$
|
64,799
|
$
|
1,565
|
$
|
66,364
|
$
|
244
|
$
|
672,356
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
September 27, 2015
|
|
|
|
|
|
|
|
|
|
Share
capital
|
Contributed
surplus
|
Retained
earnings
|
Currency
translation
adjustments
|
Cash flow
hedge reserve
|
Total
accumulated
other
comprehensive
income
|
Non-
controlling
interests
|
Total
equity
|
|
|
|
|
|
|
|
|
|
Balance, as at March
31, 2015
|
$
|
519,118
|
$
|
14,420
|
$
|
3,590
|
$
|
35,702
|
$
|
(2,268)
|
$
|
33,434
|
$
|
170
|
$
|
570,732
|
|
|
|
|
|
|
|
|
|
Net income
|
––
|
––
|
22,650
|
––
|
––
|
––
|
16
|
22,666
|
Other comprehensive
income
|
––
|
––
|
––
|
36,775
|
613
|
37,388
|
––
|
37,388
|
Total comprehensive
income
|
––
|
––
|
22,650
|
36,775
|
613
|
37,388
|
16
|
60,054
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
––
|
1,432
|
––
|
––
|
––
|
––
|
––
|
1,432
|
Exercise of stock
options
|
9,297
|
(2,330)
|
––
|
––
|
––
|
––
|
––
|
6,967
|
|
|
|
|
|
|
|
|
|
Balance, as at
September 27, 2015
|
$
|
528,415
|
$
|
13,522
|
$
|
26,240
|
$
|
72,477
|
$
|
(1,655)
|
$
|
70,822
|
$
|
186
|
$
|
639,185
|
ATS AUTOMATION
TOOLING SYSTEMS INC.
|
Interim
Consolidated Statements of Cash Flows
|
(in thousands of
Canadian dollars - unaudited)
|
|
|
|
Three months
ended
|
Six months
ended
|
|
Note
|
October 2
2016
|
September 27
2015
|
October 2
2016
|
September 27
2015
|
|
|
|
|
|
|
Operating
activities
|
|
|
|
|
|
Net income
|
|
$
|
8,473
|
$
|
12,818
|
$
|
20,574
|
$
|
22,666
|
Items not involving
cash
|
|
|
|
|
|
|
Depreciation of
property, plant and equipment
|
|
2,314
|
2,454
|
4,613
|
4,759
|
|
Amortization of
intangible assets
|
|
5,641
|
6,844
|
12,253
|
15,687
|
|
Deferred income
taxes
|
11
|
125
|
2,820
|
1,582
|
1,176
|
|
Other items not
involving cash
|
|
(721)
|
(2,135)
|
(3,137)
|
(6,489)
|
|
Stock-based
compensation
|
12
|
2,219
|
(190)
|
3,088
|
2,354
|
|
Loss (gain) on
disposal of property, plant and
equipment
|
|
90
|
(1,081)
|
94
|
(1,085)
|
|
|
18,141
|
21,530
|
39,067
|
39,068
|
Change in non-cash
operating working capital
|
|
(14,322)
|
(41,783)
|
22,276
|
(68,583)
|
Cash flows
provided by (used in)
operating activities
|
|
$
|
3,819
|
$
|
(20,253)
|
$
|
61,343
|
$
|
(29,515)
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
Acquisition of
property, plant and equipment
|
|
$
|
(2,443)
|
$
|
(2,640)
|
$
|
(4,289)
|
$
|
(5,408)
|
Acquisition of
intangible assets
|
|
(1,835)
|
(1,669)
|
(3,272)
|
(2,763)
|
|
|
|
|
|
|
Proceeds from
disposal of property, plant and equipment
|
|
88
|
1,767
|
119
|
1,801
|
Proceeds from sale of
subsidiary
|
|
––
|
––
|
––
|
2,274
|
Cash flows used in
investing activities
|
|
$
|
(4,190)
|
$
|
(2,542)
|
$
|
(7,442)
|
$
|
(4,096)
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
Bank
indebtedness
|
|
$
|
520
|
$
|
333
|
$
|
(235)
|
$
|
587
|
Repayment of
long-term debt
|
|
(121)
|
(713)
|
(265)
|
(290,768)
|
Proceeds from
long-term debt
|
|
236
|
40
|
302
|
302,557
|
Proceeds from
exercise of options
|
|
1,778
|
228
|
2,304
|
6,967
|
Cash flows
provided by (used in) financing
activities
|
|
$
|
2,413
|
$
|
(112)
|
$
|
2,106
|
$
|
19,343
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash
equivalents
|
|
2,064
|
6,920
|
597
|
4,847
|
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
|
4,106
|
(15,987)
|
56,604
|
(9,421)
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
|
222,532
|
113,092
|
170,034
|
106,526
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
|
$
|
226,638
|
$
|
97,105
|
$
|
226,638
|
$
|
97,105
|
|
|
|
|
|
|
Supplemental
information
|
|
|
|
|
|
Cash income taxes
paid
|
|
$
|
2,241
|
$
|
2,654
|
$
|
6,646
|
$
|
6,252
|
Cash interest
paid
|
|
$
|
926
|
$
|
10
|
$
|
12,162
|
$
|
3,438
|
SOURCE ATS Automation Tooling Systems Inc.