CAMBRIDGE, ON, Feb. 3, 2021 /CNW/ - ATS Automation Tooling
Systems Inc. (TSX: ATA) ("ATS" or the "Company") today reported its
financial results for the three and nine months ended December 27, 2020.
Third quarter highlights:
- Revenues increased 1% year over year to $369.7 million.
- Earnings from operations were $32.3
million (9% operating margin), compared to $10.4 million (3% operating margin) a year ago.
Adjusted earnings from operations1 were $43.8 million (12% margin), compared to
$37.5 million (10% margin) a year
ago.
- EBITDA1 was $49.7
million (13% EBITDA margin), compared to $26.8 million (7% EBITDA margin) a year ago.
- Earnings per share were 20 cents
basic and diluted compared to 4 cents
a year ago.
- Adjusted basic earnings per share1 were 30 cents compared to 26
cents a year ago.
- Order Bookings were $435 million,
18% higher than a year ago.
- Order Backlog increased 5% to $985
million at December 27, 2020
compared to $939 million a year
ago.
"Third quarter performance featured record Order Bookings and
Order Backlog with growth in life sciences and consumer products,"
said Andrew Hider, Chief Executive
Officer. "Operationally, our teams drove meaningful margin
expansion in line with our long-term plan despite the challenges
brought on by the Covid-19 environment. Our record Order
Backlog and strong balance sheet position us well to execute our
value creation strategy, build, grow and expand."
Year-to-date highlights:
- Revenues decreased 2% year over year to $1,030.1 million.
- Earnings from operations were $76.8
million (7% operating margin), compared to $70.7 million (7% operating margin) in the prior
year. Adjusted earnings from operations1 were
$113.6 million (11% margin), compared
to $118.0 million (11% margin) in the
prior year.
- EBITDA1 was $130.3
million (13% EBITDA margin), compared to $123.8 million (12% EBITDA margin) in the prior
year.
- Earnings per share was 44 cents
basic and diluted compared to 43
cents in the prior year.
- Adjusted basic earnings per share1 were 73 cents compared to 80
cents a year ago.
- Order Bookings were $1,163
million, compared to $1,112
million a year ago.
Mr. Hider added, "Our results in the first nine months of fiscal
2021 reflect solid Order Bookings, revenues and operating margins
despite the challenging environment. During the quarter we made
substantial progress on the previously announced transportation
business reorganization plan. We initiated the tender offer process
to acquire CFT Group, a company with a proven track record that
participates in an attractive, regulated growth market. Going
forward, we will continue to drive improvement in our operations,
to bring increased value to our customers with the goal of creating
long-term shareholder value"
Financial results
(In millions of dollars unless
otherwise stated)
|
3 months ended
December 27, 2020
|
3 months
ended
December 29,
2019
|
9 months
ended
December 27,
2020
|
9 months
ended
December 29,
2019
|
Revenues
|
$
|
369.7
|
$
|
367.2
|
$
|
1,030.1
|
$
|
1,047.6
|
Earnings from
operations
|
$
|
32.3
|
$
|
10.4
|
$
|
76.8
|
$
|
70.7
|
Adjusted earnings
from
operations1
|
$
|
43.8
|
$
|
37.5
|
$
|
113.6
|
$
|
118.0
|
EBITDA1
|
$
|
49.7
|
$
|
26.8
|
$
|
130.3
|
$
|
123.8
|
Net
income
|
$
|
18.9
|
$
|
4.1
|
$
|
40.3
|
$
|
39.9
|
Adjusted basic
earnings per share1
|
$
|
0.30
|
$
|
0.26
|
$
|
0.73
|
$
|
0.80
|
Basic and diluted
earnings
per
share
|
$
|
0.20
|
$
|
0.04
|
$
|
0.44
|
$
|
0.43
|
1 Non-IFRS
measure: see "Notice to Reader: Non-IFRS Measures and Additional
IFRS Measures".
|
Third quarter summary
Fiscal 2021 third quarter
revenues were 1% higher than in the corresponding period a year ago
and included $7.8 million of revenues
earned by acquired companies. Excluding acquired companies, third
quarter revenues decreased $5.3
million, or 1%, compared to the corresponding period a year
ago. Revenues from services increased 8% with broad-based strength
across ATS' businesses. Revenues from the sale of goods
increased 19% due primarily to increased sales of spare parts. This
was partially offset by a 5% decrease in revenues generated from
construction contracts due to the timing of program completion.
Foreign exchange rate changes positively impacted the translation
of revenues earned by foreign-based subsidiaries by approximately
2% compared to the corresponding period a year ago, primarily
reflecting the weakening of the Canadian dollar relative to the
Euro.
By market, revenues generated in life sciences increased 3% on
higher Order Backlog entering the third quarter of fiscal 2021.
Revenues in transportation decreased 36% on lower Order Backlog
entering the third quarter of fiscal 2021. This was due to a
slowdown in the transportation market and the implementation of a
reorganization plan that has reduced exposure to certain aspects of
the market and created alignment with market demand (see
"Reorganization Plan"). Revenues generated in consumer products
increased 88%, primarily on higher Order Backlog entering the third
quarter of fiscal 2021 related to warehouse and personal care
automation projects, as well as revenues earned by acquired
companies. Revenues in energy increased 25% due to timing of
customer projects, primarily in the nuclear market.
Fiscal 2021 third quarter earnings from operations were
$32.3 million (9% operating margin)
compared to $10.4 million (3%
operating margin) in the third quarter a year ago. Earnings from
operations included: $8.1 million
related to amortization of acquisition-related intangible assets,
up from $6.9 million a year
ago; $6.2 million of
restructuring charges incurred as part of the Company's
reorganization plan, down from $18.8
million a year ago; $2.5
million of incremental costs related to the Company's
acquisition activity, up from $1.4
million last year; and a $5.3
million gain on the sale of a facility made redundant due to
the Company's reorganization activity (see "Reorganization
Plan").
Excluding these items in both quarters, adjusted earnings from
operations were $43.8 million (12%
margin), compared to $37.5 million
(10% margin) a year ago. Higher third quarter fiscal 2021 adjusted
earnings from operations reflected higher gross margin due to
efficiencies made in the Company's cost structure, improved program
execution and increased revenues from services. In the third
quarter, the Company benefited from payments received under the
Canadian Emergency Wage Subsidy ("CEWS") program of $2.3 million.
Depreciation and amortization expense was $17.4 million in the third quarter of fiscal
2021, compared to $16.4 million a
year ago. The increase primarily reflected incremental amortization
of acquisition-related intangible assets due to the acquisition of
MARCO.
EBITDA was $49.7 million (13%
EBITDA margin) in the third quarter of fiscal 2021, compared to
$26.8 million (7% EBITDA margin) in
the third quarter of fiscal 2020. Higher EBITDA reflected lower
restructuring expenses in the third quarter of fiscal 2021 compared
to the prior year and the gain on sale of a facility, as well as an
improved cost structure.
Order Backlog Continuity
(In millions of dollars)
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December
27,
|
|
December
29,
|
|
December
27,
|
|
December
29,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Opening Order
Backlog
|
$
|
956
|
$
|
945
|
$
|
942
|
$
|
904
|
Revenues
|
|
(370)
|
|
(367)
|
|
(1,030)
|
|
(1,048)
|
Order
Bookings
|
|
435
|
|
368
|
|
1,163
|
|
1,112
|
Order Backlog
adjustments1
|
|
(36)
|
|
(7)
|
|
(90)
|
|
(29)
|
Total
|
$
|
985
|
$
|
939
|
$
|
985
|
$
|
939
|
1 Order Backlog adjustments include
foreign exchange adjustments, scope changes and cancellations.
Order Backlog adjustments for the three and nine months ended
December 27, 2020 also included incremental Order Backlog of $4
million acquired with MARCO.
|
Order Bookings
Third quarter fiscal 2021 Order
Bookings were a record $435 million,
an 18% increase compared to the third quarter of fiscal 2020.
Excluding Order Bookings from acquired companies, third quarter
fiscal 2021 Order Bookings were $429
million, a 17% year-over-year increase. By market, higher
Order Bookings in life sciences primarily related to medical device
programs. Higher Order Bookings in consumer products primarily
reflected Order Bookings of acquired companies and programs related
to warehouse automation. Order Bookings in transportation decreased
as customers paused investment decisions due to the impact of the
pandemic on the market. Bookings in energy increased due to timing
of customer projects, primarily in the nuclear market, and included
expansion of the Company's nuclear business into the United States. Foreign exchange rate
changes positively impacted the translation of Order Bookings from
foreign-based ATS subsidiaries by approximately 3% compared to the
corresponding period a year ago, primarily reflecting the weakening
of the Canadian dollar relative to the Euro.
Order Backlog
At December 27,
2020, Order Backlog was $985
million, 5% higher than at December
29, 2019, primarily driven by higher Order Bookings in the
life sciences and consumer products markets. Order Backlog
adjustments for the three months ended December 27, 2020 included an adjustment of
$8 million related to the
cancellation of a customer program which was previously placed on
hold. For the nine months ended December 27,
2020, foreign exchange rate changes negatively impacted the
translation of Order Backlog from foreign-based ATS subsidiaries by
approximately 3% compared to the corresponding period a year ago,
primarily reflecting the strengthening of the Canadian dollar
relative to the U.S. dollar.
CFT S.p.A. Voluntary Tender Update
On December 7, 2020, the Company announced its
intention to launch a voluntary public tender offer to acquire CFT
S.p.A. ("CFT"), a global supplier of automated processing and
packaging equipment to the food and beverage equipment market. The
tender offer of €4.60 per share represents a total equity value of
€88 million and a total enterprise value of €166 million
(~C$260 million). CFT is a
strategic transaction which complements the Company's recent MARCO
acquisition and will allow ATS to establish a broader growth
platform in the regulated food and beverage equipment market. In
the event the tender offer is successful, the acquisition of CFT
would be expected to close in the first quarter of calendar
2021.
The tender period under the offer will commence if and when
approval is obtained from the applicable Italian securities
regulatory authority, such approval now expected to be granted in
February 2021. The voluntary tender offer is subject to
various approvals and closing conditions, and there can be no
assurance that any remaining approvals will be obtained and/or any
remaining conditions will be met and therefore no assurance that
ATS will be successful in acquiring CFT. To date, certain
conditions or approvals have been met or obtained, including
approvals from the German anti-trust authority and the Spanish
foreign investment authority, and the waiver of certain lock-up
arrangements. Remaining conditions to closing include that:
(i) ATS be in a position to acquire at least 90% of outstanding
ordinary share capital by the end of the offer period in order to
effect the delisting of CFT's ordinary shares from the AIM Italia
stock exchange, (ii) specified changes to the by-laws of CFT are
approved by its shareholders, and (iii) customary regulatory
approvals are received, including approval from the Italian foreign
investment authority. In the event that less than 90% of the
outstanding ordinary shares of CFT were to be submitted to the
tender offer, ATS may elect to close on such lesser amount and
pursue other methods for effecting the delisting. In addition, if
less than 100% of the outstanding shares of CFT were to be
submitted pursuant to the tender offer, ATS would retain minority
shareholder interests in CFT should it proceed to complete the
tender offer.
Reorganization Plan
In September 2020, the Company announced a
reorganization plan to help mitigate the expected impact of a
slowdown in transportation markets brought on by the COVID-19
pandemic. The reorganization plan was designed to align the
capacity and cost structure of ATS' transportation business to
current and expected conditions. The reorganization included the
sale of certain assets and the transfer of employees from a
German-based subsidiary that was completed in October 2020. The Company recorded restructuring
expense of $8.1 million and
$6.2 million in the second and third
quarters of fiscal 2021, respectively, in relation to the
reorganization and further restructuring charges are not
expected.
In fiscal 2020, the Company completed a reorganization plan
which included the consolidation of certain operations and the
closure of some underperforming facilities and small branch
offices, none of which were strategically important to future
growth. The Company recorded charges of $2.0
million and $18.8 million in
the second and third quarters of fiscal 2020, respectively, in
relation to the reorganization. In the third quarter of fiscal
2021, a $5.3 million gain on the sale
of a facility made redundant due to the Company's previously
completed reorganization was included in selling, general and
administrative expenses.
Quarterly Conference Call
ATS' quarterly conference
call begins at 10:00 a.m. eastern on
Wednesday, February 3, 2021, 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 (until midnight February 10,
2021) by dialing (416) 849-0833 and entering passcode
2128258 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 4,200 people at 20
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 December 27, 2020
This Management's Discussion and Analysis ("MD&A") for
the three and nine months ended December 27,
2020 (third quarter of fiscal 2021) is as of February 2, 2021 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 third quarter of fiscal 2021, which have been prepared in
accordance with International Accounting Standard ("IAS") 34 –
Interim Financial Reporting, 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, 2020
(fiscal 2020), and, accordingly, the purpose of this document is to
provide a fiscal 2021 third quarter update to the information
contained in the fiscal 2020 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. 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 and right-of-use 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, contract assets, inventories, deposits,
prepaids and other assets, less accounts payable, accrued
liabilities, provisions and contract liabilities. 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 provide 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 have not been completed at a
specified point in time. Both Order Bookings and Order Backlog are
indicators of future revenues that 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.
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 nine-month periods ended December 27, 2020
and December 29, 2019, 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 nine-month periods ended
December 27, 2020 and December 29, 2019 is also contained in this
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 4,200 people at 20
manufacturing facilities and has over 50 offices in North America, Europe, Southeast
Asia and China.
STRATEGY
To drive the creation of long-term
sustainable shareholder value, the Company has developed a
three-part value creation strategy: Build, Grow and
Expand.
Build: To build on the Company's foundation and drive
performance improvements, management is focused on the advancement
of the ATS Business Model ("ABM"), the pursuit and measurement of
value drivers and key performance indicators, a rigorous strategic
planning process, succession planning, talent management and
employee engagement, and driving autonomy and accountability into
its businesses.
Grow: To drive growth, management is focused on growing
organically through the development and implementation of growth
tools under the ABM, providing innovation and value to the
Company's customers and markets, and growing the Company's
recurring revenue.
Expand: To expand the Company's reach, management is
focused on the development of new markets and business platforms,
expanding service offerings, investing in innovation and product
development, and strategic and disciplined acquisitions that
strengthen ATS.
The Company pursues these initiatives with a focus on strategic
capital allocation in order to drive the creation of long-term
sustainable shareholder value.
ATS Business Model
The ABM is a business management
system that ATS has developed with the goal of enabling the Company
to pursue its strategies, outpace its chosen markets, and drive
year-over-year continuous improvement. The ABM brings focus to:
- People: developing, engaging and empowering ATS' people
to build the best team;
- Process: aligning ATS' people to implement and
continuously improve robust and disciplined business processes
throughout the organization; and
- Performance: consistently measuring performance in order
to yield world-class performance for our customers and
shareholders.
The ABM is ATS' playbook, serving as the framework utilized by
the Company to achieve its business goals and objectives through
disciplined, continuous improvement. The ABM has been rolled out
across ATS divisions globally, supported with extensive training in
the use of key problem-solving tools, and applied through various
projects to drive continuous improvement.
Overview – Operating Results
Consolidated
Revenues
(In millions of dollars)
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December
27,
|
|
December
29,
|
|
December
27,
|
|
December
29,
|
Revenues by
type
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Revenues from
construction contracts
|
$
|
217.2
|
$
|
228.9
|
$
|
637.0
|
$
|
626.9
|
Services
rendered
|
|
117.0
|
|
108.4
|
|
303.6
|
|
325.8
|
Sale of
goods
|
|
35.5
|
|
29.9
|
|
89.5
|
|
94.9
|
Total
revenues
|
$
|
369.7
|
$
|
367.2
|
$
|
1,030.1
|
$
|
1,047.6
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December
27,
|
|
December
29,
|
|
December
27,
|
|
December
29,
|
Revenues by
market
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Life sciences
|
$
|
213.2
|
$
|
207.5
|
$
|
576.6
|
$
|
570.4
|
Transportation
|
|
66.7
|
|
104.2
|
|
205.0
|
|
268.8
|
Consumer products
|
|
61.1
|
|
32.5
|
|
168.4
|
|
131.5
|
Energy
|
|
28.7
|
|
23.0
|
|
80.1
|
|
76.9
|
Total
revenues
|
$
|
369.7
|
$
|
367.2
|
$
|
1,030.1
|
$
|
1,047.6
|
Fiscal 2021 third quarter revenues were 1% higher than in the
corresponding period a year ago and included $7.8 million of revenues earned by acquired
companies. Excluding acquired companies, third quarter revenues
decreased $5.3 million, or 1%,
compared to the corresponding period a year ago. Revenues from
services increased 8% with broad-based strength across ATS'
businesses. Revenues from the sale of goods increased 19% due
primarily to increased sales of spare parts. This was partially
offset by a 5% decrease in revenues generated from construction
contracts due to the timing of program completion. Foreign exchange
rate changes positively impacted the translation of revenues earned
by foreign-based subsidiaries by approximately 2% compared to the
corresponding period a year ago, primarily reflecting the weakening
of the Canadian dollar relative to the Euro.
By market, revenues generated in life sciences increased 3% on
higher Order Backlog entering the third quarter of fiscal 2021.
Revenues in transportation decreased 36% on lower Order Backlog
entering the third quarter of fiscal 2021. This was due to a
slowdown in the transportation market and the implementation of a
reorganization plan that reduced exposure to certain aspects of the
market and created alignment with market demand (see
"Reorganization Plan"). Revenues generated in consumer products
increased 88%, primarily on higher Order Backlog entering the third
quarter of fiscal 2021 related to warehouse and personal care
automation projects, as well as revenues earned by acquired
companies. Revenues in energy increased 25% due to timing of
customer projects, primarily in the nuclear market.
Year-to-date
Revenues for the nine months ended
December 27, 2020 were $1,030.1 million, 2% lower than in the
corresponding period a year ago and included $24.4 million of revenues earned by acquired
companies. Excluding acquired companies, revenues were $1,005.7 million, a 4% decrease from the
corresponding period a year ago. This was due primarily to
pandemic-related travel restrictions, as well as temporary closures
and entry restrictions at some customer sites. Revenues from
services and sale of goods decreased 7% and 6%, respectively,
compared to the corresponding period a year ago. This was partially
offset by a 2% increase in revenues generated from construction
contracts. Foreign exchange rate changes positively impacted the
translation of revenues earned by foreign-based subsidiaries by
approximately 2% compared to the corresponding period a year ago,
primarily reflecting the weakening of the Canadian dollar relative
to the Euro.
By market, fiscal 2021 year-to-date revenues from life sciences
markets increased 1%. Revenues in transportation decreased 24% due
to a slowdown in the market brought on by the COVID-19 pandemic and
the implementation of a reorganization plan that reduced exposure
to certain aspects of the market and created alignment with market
demand (see "Reorganization Plan"). Consumer products revenues
increased 28% compared to a year ago, primarily on revenues related
to warehouse automation and revenues earned by acquired companies.
Energy revenues increased 4% compared to a year ago, primarily due
to timing of projects in the nuclear market.
Consolidated Operating Results
(In millions of
dollars)
|
Three
Months
|
Three
Months
|
Nine
Months
|
Nine
Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|
2020
|
2019
|
|
2020
|
2019
|
Earnings from
operations
|
$
|
32.3
|
$
|
10.4
|
$
|
76.8
|
$
|
70.7
|
Amortization of
acquisition-related intangible assets
|
|
8.1
|
|
6.9
|
|
25.3
|
|
25.1
|
Restructuring
charges
|
|
6.2
|
|
18.8
|
|
14.3
|
|
20.8
|
Acquisition-related
transaction costs
|
|
2.5
|
|
1.4
|
|
2.5
|
|
1.4
|
Gain on sale of
facility
|
|
(5.3)
|
|
––
|
|
(5.3)
|
|
––
|
Adjusted earnings
from operations1
|
$
|
43.8
|
$
|
37.5
|
$
|
113.6
|
$
|
118.0
|
1 See
"Notice to Reader: Non-IFRS Measures and Additional IFRS
Measures."
|
|
Three
Months
|
Three
Months
|
Nine
Months
|
Nine
Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|
2020
|
2019
|
2020
|
2019
|
Earnings from
operations
|
$
|
32.3
|
$
|
10.4
|
$
|
76.8
|
$
|
70.7
|
Depreciation and
amortization
|
|
17.4
|
|
16.4
|
|
53.5
|
|
53.1
|
EBITDA2
|
$
|
49.7
|
$
|
26.8
|
$
|
130.3
|
$
|
123.8
|
2 See
"Notice to Reader: Non-IFRS Measures and Additional IFRS
Measures."
|
Third Quarter
Fiscal 2021 third quarter earnings from
operations were $32.3 million (9%
operating margin) compared to $10.4
million (3% operating margin) in the third quarter a year
ago. Earnings from operations included: $8.1
million related to amortization of acquisition-related
intangible assets, up from $6.9
million a year ago; $6.2
million of restructuring charges incurred as part of the
Company's reorganization plan, down from $18.8 million a year ago; $2.5 million of incremental costs related to the
Company's acquisition activity, up from $1.4
million last year; and a $5.3
million gain on the sale of a facility made redundant due to
the Company's reorganization activity (see "Reorganization
Plan").
Excluding these items in both quarters, adjusted earnings from
operations were $43.8 million (12%
margin), compared to $37.5 million
(10% margin) a year ago. Higher third quarter fiscal 2021 adjusted
earnings from operations reflected a higher gross margin due to
efficiencies made in the Company's cost structure, improved program
execution and increased revenues from services. In the third
quarter, the Company benefited from recoveries under the Canadian
Emergency Wage Subsidy ("CEWS") program of $2.3 million.
Depreciation and amortization expense was $17.4 million in the third quarter of fiscal
2021, compared to $16.4 million a
year ago. The increase primarily reflected incremental amortization
of acquisition-related intangible assets due to the acquisition of
MARCO.
EBITDA was $49.7 million (13%
EBITDA margin) in the third quarter of fiscal 2021, compared to
$26.8 million (7% EBITDA margin) in
the third quarter of fiscal 2020. Higher EBITDA reflected lower
restructuring expenses in the third quarter of fiscal 2021 compared
to the prior year and the gain on sale of a facility, as well as an
improved cost structure.
Year-to-date
For the nine months ended December 27,
2020, earnings from operations were $76.8 million (7% operating margin), compared to
$70.7 million (7% operating margin)
in the corresponding period a year ago. Excluding $25.3 million related to amortization of
acquisition-related intangible assets, $14.3
million of restructuring costs, $2.5
million of incremental costs related to the Company's
acquisition activity and a $5.3
million of gain on the sale of a facility, adjusted earnings
from operations were $113.6 million
(11% operating margin) in the first nine months of fiscal 2021,
compared to $118.0 million (11%
operating margin) in the corresponding period a year ago. Lower
adjusted earnings from operations in the first nine months of
fiscal 2021 primarily reflected lower revenues as well as
COVID-related operational inefficiencies arising from new health
and safety measures, including protocols to enable physical
distancing. Travel restrictions, temporary closures and entry
restrictions at some customer sites disrupted normal operations
including after-sales services activities and added costs to
projects. These increases were partially offset by recoveries under
the CEWS of $13.5 million, of which
$10.1 million was recorded in cost of
sales and $3.4 million was recorded
in selling, general and administrative expenses. These payments
were utilized by the Company to partially offset operational
inefficiencies, minimize temporary work reductions and maintain
employment of the Company's highly skilled workforce.
Depreciation and amortization expense was $53.5 million in the first nine months of fiscal
2021, compared to $53.1 million a
year ago.
Year-to-date fiscal 2021 EBITDA was $130.3 million (13% EBITDA margin) compared to
$123.8 million (12% EBITDA margin) in
the first nine months of fiscal 2020. Higher EBITDA reflected lower
restructuring expenses and the gain on sale of a facility.
Order Bookings by Quarter
Third quarter fiscal 2021
Order Bookings were a record $435
million, an 18% increase compared to the third quarter of
fiscal 2020. Excluding Order Bookings from acquired companies,
third quarter fiscal 2021 Order Bookings were $429 million, a 17% year-over-year increase. By
market, higher Order Bookings in life sciences primarily related to
medical device programs. Higher Order Bookings in consumer products
primarily reflected Order Bookings of acquired companies and
programs related to warehouse automation. Order Bookings in
transportation decreased as customers paused investment decisions
due to the impact of the pandemic on the market. Bookings in energy
increased due to timing of customer projects, primarily in the
nuclear market, and included expansion of the Company's nuclear
business into the United States.
Foreign exchange rate changes positively impacted the translation
of Order Bookings from foreign-based ATS subsidiaries by
approximately 3% compared to the corresponding period a year ago,
primarily reflecting the weakening of the Canadian dollar relative
to the Euro.
Order Backlog Continuity
(In millions of dollars)
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December
27,
|
|
December
29,
|
|
December
27,
|
|
December
29,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Opening Order
Backlog
|
$
|
956
|
$
|
945
|
$
|
942
|
$
|
904
|
Revenues
|
|
(370)
|
|
(367)
|
|
(1,030)
|
|
(1,048)
|
Order
Bookings
|
|
435
|
|
368
|
|
1,163
|
|
1,112
|
Order Backlog
adjustments1
|
|
(36)
|
|
(7)
|
|
(90)
|
|
(29)
|
Total
|
$
|
985
|
$
|
939
|
$
|
985
|
$
|
939
|
1 Order Backlog adjustments include
foreign exchange adjustments, scope changes and cancellations.
Order Backlog adjustments for the three and nine months ended
December 27, 2020 also included incremental Order Backlog of $4
million acquired with MARCO.
|
Order Backlog by Market
(In millions of dollars)
|
December
27,
|
December
29,
|
As
at
|
2020
|
2019
|
Life
sciences
|
$
|
596
|
$
|
514
|
Transportation
|
|
151
|
|
262
|
Consumer
products
|
|
130
|
|
69
|
Energy
|
|
108
|
|
94
|
Total
|
$
|
985
|
$
|
939
|
At December 27, 2020, Order
Backlog was $985 million, 5% higher
than at December 29, 2019, primarily
driven by higher Order Bookings in the life sciences and consumer
products markets. Order Backlog adjustments for the three months
ended December 27, 2020 included an
adjustment of $8 million related to
the cancellation of a customer program which was previously placed
on hold. For the nine months ended December
27, 2020, foreign exchange rate changes negatively impacted
the translation of Order Backlog from foreign-based ATS
subsidiaries by approximately 3% compared to the corresponding
period a year ago, primarily reflecting the strengthening of the
Canadian dollar relative to the U.S. dollar.
Reorganization Plan
In September 2020, the Company announced a
reorganization plan to help mitigate the expected impact of a
slowdown in transportation markets brought on by the COVID-19
pandemic. The reorganization plan was designed to align the
capacity and cost structure of ATS' transportation business to
current and expected conditions. The reorganization included the
sale of certain assets and the transfer of employees from a
German-based subsidiary that was completed in October 2020. The Company recorded restructuring
expense of $8.1 million and
$6.2 million in the second and third
quarters of fiscal 2021, respectively, in relation to the
reorganization. No further restructuring charges are expected.
In fiscal 2020, the Company completed a reorganization plan
which included the consolidation of certain operations and the
closure of some underperforming facilities and small branch
offices, none of which were strategically important to future
growth. The Company recorded charges of $2.0
million and $18.8 million in
the second and third quarters of fiscal 2020, respectively, in
relation to the reorganization. In the third quarter of fiscal
2021, a $5.3 million gain on the sale
of a facility made redundant due to the Company's previously
completed reorganization was included in selling, general and
administrative expenses.
Outlook
The outbreak of COVID-19 resulted in
governments worldwide enacting emergency measures to combat the
spread of the virus. These measures, which include the
implementation of travel restrictions, self-isolation, quarantine
periods and physical distancing requirements, have affected
economies and disrupted business operations. It is difficult to
predict the ultimate duration or severity of this downturn or its
affect on the business, financial results and conditions of the
Company. Among other impacts, the pandemic may affect customer
demand, disrupt global supply chains and equipment installation,
cause staff shortages and increase government regulations or
intervention in the near term.
Management has implemented several countermeasures designed to:
protect employees (including work from home protocols, in-plant
physical distancing requirements and shift work); ensure work on
customer projects progress; and enable continued customer service
through digital tools and regional support networks. These
responses have allowed the Company to maintain operations, although
with less efficiency.
Overall, the Company's funnel (which includes customer requests
for proposal and ATS identified customer opportunities) remains
significant; however, the timing of conversion of opportunities
into Order Bookings is more variable as some customers delay their
planned project timing.
By market, the life sciences funnel remains robust, as activity
in medical devices, pharmaceuticals and radiopharmaceuticals has
improved and is being supplemented by opportunities related to the
fight against the COVID-19 virus. In transportation, some strategic
opportunities related to new technologies have proceeded; however,
challenging end-market conditions have caused customers to delay
and re-examine capital investment plans. The Company has executed a
reorganization plan to help address the expected decreases in
revenues resulting from these conditions (see "Reorganization
Plan"). Funnel activity in energy is variable and this market
provides niche opportunities for ATS. Funnel activity in the
consumer products market has improved; however, management expects
some customers to remain cautious in deploying capital in the
current economic environment. Improvement in the Company's third
quarter Order Bookings resulted in an Order Backlog of $985 million that will help mitigate the
potential impact of volatile Order Bookings on revenues in the
short term.
The Company's Order Backlog includes several large enterprise
programs that have longer periods of performance and therefore
longer revenue recognition cycles. In the fourth quarter of fiscal
2021, management expects the conversion of Order Backlog to
revenues to be in the 35% to 40% range. Inefficiencies as a result
of travel restrictions, restricted access to customer facilities
and measures implemented to enable physical distancing across the
Company's operations are reflected in this expected conversion
range, which is also based on order delivery schedules and the
anticipated timing for the receipt of third-party component
supplies.
The Company's sales organization continues to work to engage
customers on enterprise-type solutions. Enterprise orders are
expected to provide ATS with more strategic customer relationships,
better program control, workload predictability and less short-term
sensitivity to macroeconomic forces. This approach to market and
the timing of customer decisions on larger opportunities is
expected to cause variability in Order Bookings from quarter to
quarter and lengthen the performance period and revenue recognition
for certain customer programs. The Company is working to grow
after-sales service revenues as a percentage of overall revenues
over time, which is expected to provide some balance to the capital
expenditure cycle of the Company's customers. Improvements were
made in generating revenues from the Company's after-sales service
business in the third fiscal quarter compared to the first half of
the fiscal year; however, the Company continues to be impacted by
on-going travel restrictions and some limitations on customer
facility access.
Management is pursuing several initiatives with the goal of
expanding its adjusted earnings from operations margin over the
long term, including: growing the Company's higher margin
after-sales service business; improving global supply chain
management; increasing the use of standardized platforms and
technologies; growing revenues while leveraging the Company's
current cost structure; and developing the ABM. The Company
benefitted from the CEWS program in the first three quarters due to
lower revenues in its Canadian operations. The Canadian government
has extended the CEWS program until June
2021, albeit at a lower recovery rate.
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 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: provide additional liquidity should the economic
impacts of the COVID-19 pandemic persist for an extended period;
fund its requirements for investments in non-cash working capital
and capital assets; and fund strategic investment plans including
some potential acquisitions. Acquisitions could result in
additional debt or equity financing requirements.
On December 7, 2020, the Company
announced its intention to launch a voluntary public tender offer
to acquire CFT S.p.A. ("CFT"), a global supplier of automated
processing and packaging equipment to the food and beverage
equipment market. The tender offer of €4.60 per share represents a
total equity value of €88 million and a total enterprise value of
€166 million (~C$260 million).
CFT is a strategic transaction which complements the Company's
recent MARCO acquisition and will allow ATS to establish a broader
growth platform in the regulated food and beverage equipment
market. In the event the tender offer is successful, the
acquisition of CFT would be expected to close in the first quarter
of calendar 2021.
The tender period under the offer will commence if and when
approval is obtained from the applicable Italian securities
regulatory authority, such approval now expected to be granted in
February 2021. The voluntary tender offer is subject to
various approvals and closing conditions, and there can be no
assurance that any remaining approvals will be obtained and/or any
remaining conditions will be met and therefore no assurance that
ATS will be successful in acquiring CFT. To date, certain
conditions or approvals have been met or obtained, including
approvals from the German anti-trust authority and the Spanish
foreign investment authority, and the waiver of certain lock-up
arrangements. Remaining conditions to closing include that: (i) ATS
be in a position to acquire at least 90% of outstanding ordinary
share capital by the end of the offer period in order to effect the
delisting of CFT's ordinary shares from the AIM Italia stock
exchange, (ii) specified changes to the by-laws of CFT are approved
by its shareholders, and (iii) customary regulatory approvals are
received, including approval from the Italian foreign investment
authority. In the event that less than 90% of the outstanding
ordinary shares of CFT were to be submitted to the tender offer,
ATS may elect to close on such lesser amount and pursue other
methods for effecting the delisting. In addition, if less than 100%
of the outstanding shares of CFT were to be submitted pursuant to
the tender offer, ATS would retain minority shareholder interests
in CFT should it proceed to complete the tender offer.
BUSINESS ACQUISITION: Inimco CV
On November 24, 2020, the Company acquired 100% of
the shares of Inimco CV ("Inimco"). Inimco is a Belgium-based company that offers knowledge,
resources and loT-based solutions for the process and manufacturing
industry on MS Azure and equivalent platforms. With its remote
monitoring tool, SaaS solutions and domain expertise, Inimco
enables its customers to gain insights into their machine and
productivity data, improve operational efficiency and to engage
with third parties. Inimco supports ATS' digital strategy and with
its analytics tools, ATS can identify overall equipment
effectiveness improvement potential which can lead to tangible
manufacturing productivity improvements by digitalization.
Cash consideration paid in the third quarter of fiscal 2021 was
$3.9 million (2.5 million Euros). Included in the purchase
price is contingent consideration of up to $1.5 million (1.0 million
Euros) which is payable if certain performance targets are
met within three fiscal years of the acquisition date. This
acquisition was accounted for as a business combination with the
Company as the acquirer of Inimco. The purchase method of
accounting was used and the earnings were consolidated from the
acquisition date, November 24,
2020.
CONSOLIDATED RESULTS
(In millions of dollars, except
per share data)
|
Three
Months
|
Three
Months
|
Nine
Months
|
Nine
Months
|
|
Ended
|
Ended
|
Ended
|
Ended
|
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|
2020
|
2019
|
2020
|
2019
|
Revenues
|
$
|
369.7
|
$
|
367.2
|
$
|
1,030.1
|
$
|
1,047.6
|
Cost of
revenues
|
|
267.0
|
|
275.0
|
|
757.0
|
|
774.2
|
Selling, general and
administrative
|
|
59.3
|
|
58.5
|
|
174.5
|
|
174.7
|
Restructuring
costs
|
|
6.2
|
|
18.8
|
|
14.3
|
|
20.8
|
Stock-based
compensation
|
|
4.9
|
|
4.5
|
|
7.5
|
|
7.2
|
Earnings from
operations
|
$
|
32.3
|
$
|
10.4
|
$
|
76.8
|
$
|
70.7
|
Net finance
costs
|
$
|
7.3
|
$
|
6.5
|
$
|
23.5
|
$
|
20.3
|
Provision for income
taxes
|
|
6.1
|
|
(0.2)
|
|
13.0
|
|
10.5
|
Net
income
|
$
|
18.9
|
$
|
4.1
|
$
|
40.3
|
$
|
39.9
|
Basic and diluted
earnings per share
|
$
|
0.20
|
$
|
0.04
|
$
|
0.44
|
$
|
0.43
|
Revenues. At $369.7
million, consolidated revenues for the third quarter of
fiscal 2021 were $2.5 million or 1%
higher than in the corresponding period a year ago. At $1,030.1 million, year-to-date consolidated
revenues were $17.5 million, or 2%,
lower than in the corresponding period a year ago (see "Overview –
Operating Results").
Cost of revenues. At $267.0
million, third quarter fiscal 2021 cost of revenues
decreased by $8.0 million, or 3%,
compared to the corresponding period a year ago, primarily due to
efficiencies made in the Company's cost structure and improved
program execution. Year-to-date cost of revenues of $757.0 million decreased $17.2 million, or 2%, compared to the prior year,
primarily due to lower revenues. Gross margin was 28% for the third
quarter of fiscal 2021 compared to 25% in the corresponding period
a year ago, due to efficiencies made in the Company's cost
structure, improved program execution, increased revenues from
services and $1.8 million of
recoveries under the CEWS program.
Year-to-date gross margin was 27% compared to 26% in the
corresponding period a year ago, due primarily to efficiency gains
from the Company's implemented reorganizations, improved program
execution and $10.1 million of
recoveries under the CEWS program, which helped to offset lower
after-sales services revenues and operational inefficiencies
related to COVID-19.
Selling, general and administrative ("SG&A")
expenses. SG&A expenses were $59.3
million, which included $8.1
million of costs related to the amortization of identifiable
intangible assets on business acquisitions, $2.5 million of incremental costs related to the
Company's acquisition activity and a $5.3
million gain on the sale of a facility. Excluding these
items, SG&A expenses were $54.0
million in the third quarter of fiscal 2021. Comparably,
SG&A expenses for the third quarter of fiscal 2020 were
$50.2 million, which excluded
$6.9 million of costs related to the
amortization of identifiable intangible assets recorded on business
acquisitions and $1.4 million of
incremental costs related to the Company's acquisition activity.
Higher SG&A expenses in the third quarter of fiscal 2021
primarily reflected SG&A costs from acquired companies and
increased employee costs, partially offset by the benefit of the
fiscal 2020 reorganization, $0.5
million of recoveries under the CEWS program and cost
containment measures.
For the nine months ended December 27,
2020, SG&A expenses were $174.5
million, which included $25.3
million of expenses related to the amortization of
identifiable intangible assets on business acquisitions,
$2.5 million of incremental costs
related to the Company's acquisition activity and a $5.3 million gain on the sale of a facility.
Excluding these items, year-to-date SG&A expenses were
$152.0 million. Comparably, SG&A
expenses for the nine months ended December
29, 2019 were $148.2 million,
which excluded $25.1 million of
expenses related to the amortization of identifiable intangible
assets on business acquisitions and $1.4
million of incremental costs related to the Company's
acquisition activity. Higher SG&A expenses primarily related to
the assumption of SG&A from acquired companies, partially
offset by $3.4 million of recoveries
under the CEWS program.
Restructuring costs. For the three- and nine-months ended
December 27, 2020, restructuring
costs were $6.2 million and
$14.3 million, respectively, compared
to restructuring costs of $18.8
million and $20.8 million,
respectively, in the corresponding periods a year ago (see
"Reorganization Plan").
Stock-based compensation. Stock-based compensation
expense was $4.9 million in the third
quarter of fiscal 2021 compared to $4.5
million in the corresponding period a year ago. For the
nine-month period ended December 27,
2020, stock-based compensation expense was $7.5 million, compared to $7.2 million a year earlier.
Earnings from operations. For the three- and
nine-month periods ended December 27,
2020, earnings from operations were $32.3 million (9% operating margin) and
$76.8 million (7% operating margin),
respectively, compared to earnings from operations of $10.4 million (3% operating margin) and
$70.7 million (7% operating margin),
respectively, in the corresponding periods a year ago (see
"Overview – Operating Results").
Net finance costs. Net finance costs were
$7.3 million in the third quarter of
fiscal 2021, compared to $6.5 million
a year ago. Higher interest expense in the three months ended
December 27, 2020 was primarily due
to lower interest income and higher standby fees. For the nine
months ended December 27, 2020,
finance costs were $23.5 million
compared to $20.3 million in the
corresponding period a year ago. Higher year-to-date interest
related to a $250.0 million cash draw
on the Company's senior secured credit facility at the end of
March 2020 as a precautionary measure
related to the pandemic. These funds were repaid in the second
quarter of fiscal 2021.
Income tax provision. For the three and nine months ended
December 27, 2020, the Company's
effective income tax rate of 24% differed from the combined
Canadian basic federal and provincial income tax rate of 27%
primarily due to income earned in certain jurisdictions with
different statutory tax rates.
Net income. Fiscal 2021 third quarter net income was
$18.9 million (20 cents per share basic and diluted) compared to
$4.1 million (4 cents per share basic and diluted) for the
third quarter of fiscal 2020. Adjusted basic earnings per share
were 30 cents compared to
26 cents in the third quarter of
fiscal 2020 (see "Reconciliation of Non-IFRS Measures to IFRS
Measures").
Net income for the nine months ended December 27, 2020 was $40.3 million (44
cents per share basic and diluted) compared to $39.9 million (43
cents per share basic and diluted) for the corresponding
period a year ago. Adjusted basic earnings per share were
73 cents in the nine months ended
December 27, 2020 compared to
80 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 table reconciles EBITDA to the most directly
comparable IFRS measure (net income):
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December
27,
|
|
December
29,
|
|
December
27,
|
|
December
29,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
EBITDA
|
$
|
49.7
|
$
|
26.8
|
$
|
130.3
|
$
|
123.8
|
Less: depreciation
and amortization expense
|
|
17.4
|
|
16.4
|
|
53.5
|
|
53.1
|
Earnings from
operations
|
$
|
32.3
|
$
|
10.4
|
$
|
76.8
|
$
|
70.7
|
Less: net finance
costs
|
|
7.3
|
|
6.5
|
|
23.5
|
|
20.3
|
Provision for income
taxes
|
|
6.1
|
|
(0.2)
|
|
13.0
|
|
10.5
|
Net
income
|
$
|
18.9
|
$
|
4.1
|
$
|
40.3
|
$
|
39.9
|
The following table reconciles adjusted earnings from operations
and adjusted basic earnings per share to the most directly
comparable IFRS measure (net income and basic earnings per
share):
|
Three Months Ended
December 27, 2020
|
Three Months Ended
December 29, 2019
|
|
IFRS
|
Adjustments
|
Adjusted
|
IFRS
|
Adjustments
|
Adjusted
|
|
|
|
(non-IFRS)
|
|
|
(non-IFRS)
|
Earnings from
operations
|
$
|
32.3
|
$
|
––
|
$
|
32.3
|
$
|
10.4
|
$
|
––
|
$
|
10.4
|
Amortization of
acquisition-
|
|
|
|
|
|
|
|
|
|
|
|
|
related intangible
assets
|
|
––
|
|
8.1
|
|
8.1
|
|
––
|
|
6.9
|
|
6.9
|
Restructuring
charges
|
|
––
|
|
6.2
|
|
6.2
|
|
––
|
|
18.8
|
|
18.8
|
Acquisition-related
transaction costs
|
|
––
|
|
2.5
|
|
2.5
|
|
––
|
|
1.4
|
|
1.4
|
Gain on sale of
facility
|
|
––
|
|
(5.3)
|
|
(5.3)
|
|
––
|
|
––
|
|
––
|
|
$
|
32.3
|
$
|
11.5
|
$
|
43.8
|
$
|
10.4
|
$
|
27.1
|
$
|
37.5
|
Less: net finance
costs
|
$
|
7.3
|
$
|
––
|
$
|
7.3
|
$
|
6.5
|
$
|
––
|
$
|
6.5
|
Income before
income taxes
|
$
|
25.0
|
$
|
11.5
|
$
|
36.5
|
$
|
3.9
|
$
|
27.1
|
$
|
31.0
|
Provision for income
taxes
|
$
|
6.1
|
$
|
––
|
$
|
6.1
|
$
|
(0.2)
|
$
|
––
|
$
|
(0.2)
|
Adjustment to
provision for
|
|
|
|
|
|
|
|
|
|
|
|
|
income
taxes1
|
|
––
|
|
3.1
|
|
3.1
|
|
––
|
|
7.5
|
|
7.5
|
|
$
|
6.1
|
$
|
3.1
|
$
|
9.2
|
$
|
(0.2)
|
$
|
7.5
|
$
|
7.3
|
Net
income
|
$
|
18.9
|
$
|
8.4
|
$
|
27.3
|
$
|
4.1
|
$
|
19.6
|
$
|
23.7
|
Basic earnings per
share
|
$
|
0.20
|
$
|
0.10
|
$
|
0.30
|
$
|
0.04
|
$
|
0.22
|
$
|
0.26
|
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.
|
|
Nine Months Ended
December 27, 2020
|
Nine Months Ended
December 29, 2019
|
|
IFRS
|
Adjustments
|
Adjusted
|
IFRS
|
Adjustments
|
Adjusted
|
|
|
|
(non-IFRS)
|
|
|
(non-IFRS)
|
Earnings from
operations
|
$
|
76.8
|
$
|
––
|
$
|
76.8
|
$
|
70.7
|
$
|
––
|
$
|
70.7
|
Amortization of
acquisition-
|
|
|
|
|
|
|
|
|
|
|
|
|
related intangible
assets
|
|
––
|
|
25.3
|
|
25.3
|
|
––
|
|
25.1
|
|
25.1
|
Restructuring
charges
|
|
––
|
|
14.3
|
|
14.3
|
|
––
|
|
20.8
|
|
20.8
|
Acquisition-related
transaction costs
|
|
––
|
|
2.5
|
|
2.5
|
|
––
|
|
1.4
|
|
1.4
|
Gain on sale of
facility
|
|
––
|
|
(5.3)
|
|
(5.3)
|
|
––
|
|
––
|
|
––
|
|
$
|
76.8
|
$
|
36.8
|
$
|
113.6
|
$
|
70.7
|
$
|
47.3
|
$
|
118.0
|
Less: net finance
costs
|
$
|
23.5
|
$
|
––
|
$
|
23.5
|
$
|
20.3
|
$
|
––
|
$
|
20.3
|
Income before
income taxes
|
$
|
53.3
|
$
|
36.8
|
$
|
90.1
|
$
|
50.4
|
$
|
47.3
|
$
|
97.7
|
Provision for income
taxes
|
$
|
13.0
|
$
|
––
|
$
|
13.0
|
$
|
10.5
|
$
|
––
|
$
|
10.5
|
Adjustment to
provision for
|
|
|
|
|
|
|
|
|
|
|
|
|
income
taxes1
|
|
––
|
|
9.9
|
|
9.9
|
––
|
|
|
13.0
|
|
13.0
|
|
$
|
13.0
|
$
|
9.9
|
$
|
22.9
|
$
|
10.5
|
$
|
13.0
|
$
|
23.5
|
Net
income
|
$
|
40.3
|
$
|
26.9
|
$
|
67.2
|
$
|
39.9
|
$
|
34.3
|
$
|
74.2
|
Basic earnings per
share
|
$
|
0.44
|
$
|
0.29
|
$
|
0.73
|
$
|
0.43
|
$
|
0.37
|
$
|
0.80
|
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
|
December 27, 2020
|
March 31,
2020
|
Cash and cash
equivalents
|
$
|
224.5
|
$
|
358.6
|
Debt-to-equity
ratio1
|
|
0.46:1
|
|
0.86:1
|
1 Debt is
calculated as bank indebtedness, long-term debt and lease
liabilities. Equity is calculated as total equity less accumulated
other comprehensive income.
|
|
|
Three
Months
|
|
Three
Months
|
|
Nine
Months
|
|
Nine
Months
|
|
|
Ended
|
|
Ended
|
|
Ended
|
|
Ended
|
|
|
December 27,
|
|
December
29,
|
|
December 27,
|
|
December
29,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Cash flows (used in)
provided by operating activities
|
$
|
78.9
|
$
|
(7.0)
|
$
|
146.2
|
$
|
10.6
|
At December 27, 2020, the Company
had cash and cash equivalents of $224.5
million compared to $358.6
million at March 31, 2020. At
December 27, 2020, the Company's
debt-to-total equity ratio was 0.46:1 and reflected $250.0 million repaid under the Company's senior
secured credit facility.
In the third quarter of fiscal 2021, cash flows provided by
operating activities were $78.9
million ($7.0 million used in
operating activities in the third quarter a year ago). In the nine
months ended December 27, 2020, cash
flows provided by operating activities were $146.2 million ($10.6
million provided by 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 certain customer programs.
In the third quarter of fiscal 2021, the Company's investment in
non-cash working capital decreased by $43.6
million from September 27,
2020. On a year-to-date basis, investment in non-cash
working capital decreased $55.2
million. Accounts receivable decreased by $0.1 million, and net contract assets decreased
$91.8 million, or 81%, compared to
March 31, 2020, due to the timing of
billings in certain customer contracts. The Company actively
manages its accounts receivable, contract asset and contract
liability balances through billing terms on long-term contracts and
collection efforts. Inventories decreased 1%, or $0.8 million, primarily due to a decrease in
work-in-process on certain customer projects. Deposits and prepaid
assets decreased $0.1 million from
March 31, 2020. Accounts payable and
accrued liabilities decreased 13%, or $36.4
million, compared to March 31,
2020. Provisions decreased 13%, or $4.2 million, compared to March 31, 2020, due to payments in the first nine
months of fiscal 2021 related to the Company's reorganization
plan.
Cash investments in property, plant and equipment totalled
$11.1 million in the first nine
months of fiscal 2021, primarily related to the expansion and
improvement of certain manufacturing facilities.
Intangible assets expenditures were $7.4
million in the first nine months of fiscal 2021 and
primarily related to computer software and various internal
development projects.
At December 27, 2020, the Company
had $776.9 million of unutilized
multipurpose credit, including letters of credit, available under
existing credit facilities and an additional $172.5 million available under letter of credit
facilities.
On July 29, 2020, the Company
amended its senior secured credit facility (the "Credit Facility")
and extended its maturity to August 29,
2022. The Credit Facility provides a committed revolving
credit facility of $750.0 million.
The Credit Facility is secured by the Company's assets, including a
pledge of shares of certain of the Company's subsidiaries. Certain
of the Company's subsidiaries also provide guarantees under the
Credit Facility. At December 27,
2020, the Company had utilized $2.2
million under the Credit Facility, of which $nil was
classified as long-term debt (March 31,
2020 - $250.0 million) and
$2.2 million by way of letters of
credit (March 31, 2020 - $149.4 million).
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 net 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 0.95% to 2.50%. For bankers' acceptances and LIBOR advances,
the interest rate is equal to the bankers' acceptance fee or LIBOR,
respectively, plus a margin that varies from 1.95% to 3.50%. The
Company pays a fee for usage of financial letters of credit that
ranges from 1.95% to 3.50%, and a fee for usage of non-financial
letters of credit that ranges from 1.30% to 2.33%. 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 0.39% to 0.79%.
The Credit Facility is subject to financial covenants including
a net 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 December 27,
2020, all covenants were met.
The Company has additional credit facilities available of
$30.8 million (10.1 million Euros, $10.0
million U.S., 50.0 million Thai
Baht and 0.7 million Czech Koruna). The total amount
outstanding on these facilities at December
27, 2020 was $1.3
million, of which $1.2 million
was classified as bank indebtedness (March
31, 2020 - $4.6 million) and
$0.1 million was classified as
long-term debt (March 31, 2020 -
$0.2 million). The interest rates
applicable to the credit facilities range from 1.75% to 6.25% per
annum. A portion of the long-term debt is secured by certain assets
of the Company.
Subsequent to the third quarter (on December 29, 2020), the Company completed a
private placement of U.S. $350.0
million aggregate principal amount of senior notes (the
"Senior Notes"). Transaction fees of $8.1
million were deferred and will be amortized over the term of
the Senior Notes. On January 13,
2021, ATS used the net proceeds from the Senior Notes to
fund the redemption of its $250.0
million 6.500% senior notes due 2023 (the "Existing Notes"),
which were outstanding as at December 27,
2020, and intends to use the remainder of the net proceeds
for general corporate purposes. Subsequent to December 27, 2020, the Company recorded finance
costs of approximately $9.0 million
related to the redemption of the Existing Notes.
The Senior Notes were issued at par, bear interest at a rate of
4.125% per annum and mature on December 15,
2028. 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 are guaranteed by
each of the subsidiaries of the Company that is a borrower or has
guaranteed obligations under the Credit
Facility.
Contractual Obligations
(In millions of dollars)
The Company's minimum
purchase obligations are as follows as at December 27,
2020:
|
Less than one
year
|
$
|
173.6
|
One – two
years
|
|
4.8
|
Two – three
years
|
|
1.0
|
Three – four
years
|
|
0.2
|
|
$
|
179.6
|
The Company's off-balance sheet arrangements consist of purchase
obligations which consist primarily of commitments for material
purchases, which have been entered into in the normal course of
business.
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 December 27, 2020, the total value of outstanding
letters of credit was approximately $160.6
million (March 31, 2020 -
$219.0 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 interim consolidated statement of 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. 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 receivables insurance in certain instances.
SHARE DATA
During the first nine months of fiscal
2021, 408,363 stock options were exercised. At February 2, 2021, the total number of shares
outstanding was 92,027,790, and there were 946,271 stock options
outstanding to acquire common shares of the Company.
NORMAL COURSE ISSUER BID
On December 21, 2020, 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 has the ability to purchase for
cancellation up to a maximum of 7,351,834 common shares of the
Company during the 12-month period ending December 22, 2021.
Some purchases under the NCIB may be made pursuant to an
automatic purchase plan between ATS and its broker. This plan
enables the purchase of ATS common shares when ATS would not
ordinarily be active in the market due to internal trading blackout
periods, insider trading rules, or otherwise. ATS security holders
may obtain a copy of the notice, without charge, upon request from
the Secretary of the Company.
For the nine months ended December 27,
2020, the Company purchased 511,528 common shares for
$8.7 million under the previous NCIB
program and nil common shares under the new NCIB program. The
weighted average price per repurchased share was $16.93.
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 nine months of fiscal 2021.
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. Subsequent to the
third quarter (on January 13, 2021),
the Company settled the cross-currency interest rate swap
instrument to swap U.S. $150.0
million into Canadian dollars that was outstanding at
December 27, 2020. The Company
received interest of 6.50% U.S. per annum and paid interest of
6.501% Canadian. The Company also settled a cross-currency interest
rate swap instrument to swap 134.1 million
Euros into Canadian dollars that was outstanding on
December 27, 2020. The Company
received interest of 6.501% Canadian per annum and paid interest of
5.094% Euros. The Company paid $16.9
million to settle the cross-currency swaps.
Subsequent to the third quarter (on January 13, 2021), the Company entered into a
cross-currency interest rate swap instrument to swap U.S.
$175.0 million into Canadian dollars
to hedge a portion of its foreign exchange risk related to its U.S.
dollar-denominated Senior Notes. The Company will receive interest
of 4.125% U.S. per annum and pay interest of 4.257% Canadian. The
terms of the hedging relationship will end on December 15, 2025.
The Company manages foreign exchange risk on its
Euro-denominated net investments. The Company uses a cross-currency
interest rate swap as derivative financial instruments to hedge a
portion of the foreign exchange risk related to its
Euro-denominated net investment. Subsequent to the third quarter
(on January 13, 2021), the Company
entered into a cross-currency interest rate swap instrument to swap
143.9 million Euros into Canadian
dollars. The Company will receive interest of 4.257% Canadian per
annum and pay interest of 3.145% Euros. The terms of the hedging
relationship will end on December 15,
2025.
In addition, from time to time, the Company may hedge the
foreign exchange risk arising from foreign currency debt,
intercompany loans, net investments in foreign-based subsidiaries
and committed acquisitions through the use of forward foreign
exchange contracts or other non-derivative financial instruments.
The Company uses hedging as a risk management tool, not to
speculate.
Period Average Exchange Rates in CDN$
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
December
27,
|
December 29,
|
|
December
27,
|
December
29,
|
|
|
2020
|
2019
|
% change
|
2020
|
2019
|
% change
|
U.S.
dollar
|
1.304
|
1.321
|
(1.3%)
|
1.340
|
1.327
|
1.0%
|
Euro
|
1.553
|
1.462
|
6.2%
|
1.545
|
1.478
|
4.5%
|
CONSOLIDATED QUARTERLY RESULTS
(In millions of
dollars, except per share amounts)
|
|
Q3
|
|
Q2
|
|
Q1
|
|
Q4
|
|
Q3
|
|
Q2
|
|
Q1
|
|
Q4
|
|
|
2021
|
|
2021
|
|
2021
|
|
2020
|
|
2020
|
|
2020
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
369.7
|
$
|
335.5
|
$
|
324.9
|
$
|
382.1
|
$
|
367.2
|
$
|
341.2
|
$
|
339.2
|
$
|
348.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings from
operations
|
$
|
32.3
|
$
|
23.4
|
$
|
21.1
|
$
|
24.9
|
$
|
10.4
|
$
|
31.7
|
$
|
28.6
|
$
|
30.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted earnings
from
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
operations1
|
$
|
43.8
|
$
|
40.1
|
$
|
29.7
|
$
|
39.3
|
$
|
37.5
|
$
|
42.5
|
$
|
38.0
|
$
|
38.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
18.9
|
$
|
11.6
|
$
|
9.8
|
$
|
13.1
|
$
|
4.1
|
$
|
19.3
|
$
|
16.4
|
$
|
18.2
|
Basic and diluted
earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
per share
|
$
|
0.20
|
$
|
0.13
|
$
|
0.11
|
$
|
0.14
|
$
|
0.04
|
$
|
0.21
|
$
|
0.18
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted basic
earnings per
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
share1
|
$
|
0.30
|
$
|
0.26
|
$
|
0.17
|
$
|
0.26
|
$
|
0.26
|
$
|
0.29
|
$
|
0.25
|
$
|
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Order
Bookings2
|
$
|
435.0
|
$
|
403.0
|
$
|
325.0
|
$
|
356.0
|
$
|
368.0
|
$
|
321.0
|
$
|
423.0
|
$
|
298.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Order
Backlog3
|
$
|
985.0
|
$
|
956.0
|
$
|
909.0
|
$
|
942.0
|
$
|
939.0
|
$
|
945.0
|
$
|
982.0
|
$
|
904.0
|
1 Non-IFRS measure. See "Notice
to reader: Non-IFRS measures and additional IFRS measures" and
"Reconciliation of Non-IFRS Measures to IFRS
Measures."
|
2 Non-IFRS measure. See "Notice
to reader: Non-IFRS measures and additional IFRS measures" and
"Order Bookings by Quarter."
|
3 Non-IFRS measure. See "Notice
to reader: Non-IFRS measures and additional IFRS measures" and
"Order Backlog Continuity."
|
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 employee vacation
time and summer plant shutdowns by its customers. The COVID-19
pandemic is likely to affect quarterly performance patterns in
fiscal 2021.
CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
The
preparation of the Company's interim condensed 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 interim condensed 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 2020 MD&A.
COVID-19
There is significant uncertainty regarding
the extent and duration of the impact of the COVID-19 pandemic on
the Company's operations. The impact of the pandemic on the
Company's financial condition, cash flows, operations, credit risk,
liquidity and availability of credit is highly uncertain and cannot
be predicted. Management will continue to monitor and assess
the impact of the pandemic on its judgments, estimates, accounting
policies and amounts recognized in the interim condensed
consolidated financial statements.
CONTROLS AND PROCEDURES
The Chief Executive Officer
("CEO") and the Chief Financial Officer ("CFO") of the Company 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").
In response to the COVID-19 pandemic, the Company implemented
measures to enable physical distancing across ATS' operations,
including remote work. This change required certain processes and
controls that were previously done or documented manually to be
completed and retained in electronic form. The Company continues to
monitor whether remote work arrangements have adversely affected
the Company's ability to maintain internal controls over financial
reporting and disclosure controls and procedures. Despite the
changes required by the current environment, there have been no
changes or material weaknesses in the design of the Company's
internal controls over financial reporting during the three and
nine months ended December 27, 2020
that have materially affected, or are reasonably likely to
materially affect, the Company's internal controls over financial
reporting.
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.
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: the
strategic framework; the Company's strategy to expand organically
and through acquisition; the ATS Business Model ("ABM");
restructuring charges related to the reorganization plan; the
potential impact of COVID-19 and government emergency measures;
conversion of opportunities into Order Bookings; the Company's
Order Backlog partially mitigating the impact of volatile Order
Bookings; rate of Order Backlog conversion; the expected benefits
where the company engages with customers on enterprise-type
solutions and the potential impact on Order Bookings, performance
period, and timing of revenue recognition; expected benefits with
respect to the Company's efforts to expand its services revenues;
initiatives having the goal of expanding adjusted earnings from
operations margin over long-term; the CEWS program; non-cash
working capital levels as a percentage of revenues; expectation in
relation to meeting liquidity and funding requirements for
investments; potential to use leverage to support growth strategy;
voluntary public tender offer to acquire CFT; and the Company's
belief with respect to the outcome of certain lawsuits, claims and
contingencies. The risks and uncertainties that may affect
forward-looking statements include, among others: the progression
of COVID-19 and its impacts on the Company's ability to operate its
assets, including the possible shut-down of facilities due to
COVID-19 outbreaks; the severity and duration of the COVID-19
pandemic in all jurisdictions where the Company conducts its
business; the nature and extent of government imposed restrictions
on travel and business activities and the nature, extent, and
applicability of government assistance programs, in both cases
related to the COVID-19 pandemic, as applicable in all
jurisdictions where the Company conducts its business; the impact
of the COVID-19 pandemic on the Company's employees, customers, and
suppliers; impact of COVID-19 on 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; 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 some or
all of the sales funnel is not converted to Order Bookings due to
competitive factors or failure to meet customer needs; timing of
customer decisions related to large enterprise programs and
potential for 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 the Company is
not successful in growing its service offering or that expected
benefits are not realized; that efforts to expand adjusted earnings
from operations margin over long-term is unsuccessful, due to any
number of reasons, including less than anticipated increase in
after-sales service revenues or reduced margins attached to those
revenues, inability to achieve lower costs through supply chain
management, failure to develop, adopt internally, or have customers
adopt, standardized platforms and technologies, inability to
maintain current cost structure if revenues were to grow, and
failure of ABM to impact margins; that the CEWS program ceases to
be available, that the Company ceases to qualify, or that the
benefits under the program are other than expected; 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; that the proposed acquisition of CFT will not occur or
that the anticipated benefits and effects of the transaction will
not be realized – the CFT tender offer is subject to various
approvals and the fulfillment of certain conditions and there can
be no assurance that any such approvals will be obtained and/or any
such conditions will be met - the tender offer could be modified,
restructured or terminated; risk that the ultimate outcome of
lawsuits, claims, and contingencies give rise to material
liabilities for which no provisions have been recorded; 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 and/or professional 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)
|
|
|
December 27
|
|
March
31
|
As at
|
Note
|
|
2020
|
|
2020
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Current
assets
|
11
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
224,544
|
$
|
358,645
|
Accounts
receivable
|
|
|
291,058
|
|
291,126
|
Income tax
receivable
|
|
|
1,517
|
|
3,720
|
Contract
assets
|
17
|
|
233,911
|
|
231,531
|
Inventories
|
5
|
|
67,599
|
|
68,436
|
Deposits, prepaids
and other assets
|
6
|
|
31,021
|
|
31,149
|
|
|
|
849,650
|
|
984,607
|
Non-current
assets
|
|
|
|
|
|
Property, plant and
equipment
|
|
|
125,284
|
|
136,284
|
Right-of-use
assets
|
7
|
|
52,334
|
|
61,156
|
Other
assets
|
8
|
|
––
|
|
20,220
|
Goodwill
|
|
|
608,304
|
|
608,243
|
Intangible
assets
|
|
|
197,211
|
|
220,169
|
Deferred income tax
assets
|
|
|
10,940
|
|
2,725
|
Investment tax credit
receivable
|
|
|
61,787
|
|
64,569
|
|
|
|
1,055,860
|
|
1,113,366
|
Total
assets
|
|
$
|
1,905,510
|
$
|
2,097,973
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Bank
indebtedness
|
11
|
$
|
1,180
|
$
|
4,572
|
Accounts payable and
accrued liabilities
|
|
|
252,895
|
|
289,313
|
Income tax
payable
|
|
|
10,269
|
|
3,084
|
Contract
liabilities
|
17
|
|
211,979
|
|
117,757
|
Provisions
|
10
|
|
27,898
|
|
32,126
|
Current portion of
lease liabilities
|
7
|
|
13,701
|
|
15,696
|
Current portion of
long-term debt
|
11
|
|
90
|
|
133
|
|
|
|
518,012
|
|
462,681
|
Non-current
liabilities
|
|
|
|
|
|
Employee
benefits
|
|
|
25,561
|
|
26,247
|
Long-term lease
liabilities
|
7
|
|
40,634
|
|
47,209
|
Long-term
debt
|
11
|
|
316,003
|
|
597,965
|
Deferred income tax
liabilities
|
|
|
83,916
|
|
86,821
|
Other long-term
liabilities
|
8
|
|
17,338
|
|
8,037
|
|
|
|
483,452
|
|
766,279
|
Total
liabilities
|
|
$
|
1,001,464
|
$
|
1,228,960
|
|
|
|
|
|
|
Commitments and
contingencies
|
11, 15
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Share
capital
|
12
|
$
|
525,482
|
$
|
521,884
|
Contributed
surplus
|
|
|
11,085
|
|
11,680
|
Accumulated other
comprehensive income
|
|
|
90,085
|
|
92,585
|
Retained
earnings
|
|
|
276,644
|
|
242,076
|
Equity attributable
to shareholders
|
|
|
903,296
|
|
868,225
|
Non-controlling
interests
|
|
|
750
|
|
788
|
Total
equity
|
|
|
904,046
|
|
869,013
|
Total liabilities
and equity
|
|
$
|
1,905,510
|
$
|
2,097,973
|
ATS AUTOMATION TOOLING SYSTEMS
INC.
Interim Consolidated Statements of Income
(in
thousands of Canadian dollars, except per share amounts -
unaudited)
|
|
Three months
ended
|
Nine months
ended
|
|
Note
|
December
27
|
December
29
|
December
27
|
December 29
|
|
|
2020
|
2019
|
2020
|
2019
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
Revenues from construction
contracts
|
|
$
|
217,244
|
$
|
228,901
|
$
|
636,980
|
$
|
626,960
|
Sale of goods
|
|
|
35,497
|
|
29,925
|
|
89,500
|
|
94,905
|
Services
rendered
|
|
|
116,990
|
|
108,359
|
|
303,650
|
|
325,778
|
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
17
|
|
369,731
|
|
367,185
|
|
1,030,130
|
|
1,047,643
|
|
|
|
|
|
|
|
|
|
|
Operating costs
and
expenses
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
267,028
|
|
274,985
|
|
756,960
|
|
774,224
|
Selling, general and
administrative
|
|
|
59,331
|
|
58,508
|
|
174,498
|
|
174,748
|
Restructuring
costs
|
10
|
|
6,208
|
|
18,797
|
|
14,355
|
|
20,773
|
Stock-based compensation
|
14
|
|
4,891
|
|
4,544
|
|
7,510
|
|
7,221
|
|
|
|
|
|
|
|
|
|
|
Earnings from
operations
|
|
|
32,273
|
|
10,351
|
|
76,807
|
|
70,677
|
|
|
|
|
|
|
|
|
|
|
Net finance costs
|
18
|
|
7,271
|
|
6,440
|
|
23,502
|
|
20,294
|
|
|
|
|
|
|
|
|
|
|
Income before
income
taxes
|
|
|
25,002
|
|
3,911
|
|
53,305
|
|
50,383
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(recovery)
|
13
|
|
6,112
|
|
(162)
|
|
13,036
|
|
10,527
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
18,890
|
$
|
4,073
|
$
|
40,269
|
$
|
39,856
|
|
|
|
|
|
|
|
|
|
|
Attributable
to
|
|
|
|
|
|
|
|
|
|
Shareholders
|
|
$
|
18,838
|
$
|
3,983
|
$
|
40,307
|
$
|
39,764
|
Non-controlling
interests
|
|
|
52
|
|
90
|
|
(38)
|
|
92
|
|
|
$
|
18,890
|
$
|
4,073
|
$
|
40,269
|
$
|
39,856
|
Earnings per
share
|
|
|
|
|
|
|
|
|
|
attributable to
shareholders
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
19
|
$
|
0.20
|
$
|
0.04
|
$
|
0.44
|
$
|
0.43
|
ATS AUTOMATION TOOLING SYSTEMS
INC.
Interim Consolidated Statements of Comprehensive
Income
(in thousands of Canadian dollars - unaudited)
|
|
Three months
ended
|
|
Nine months ended
|
|
|
December
27
|
|
December
29
|
|
December
27
|
|
December
29
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
|
|
|
|
|
|
|
Net income
|
$
|
18,890
|
$
|
4,073
|
$
|
40,269
|
$
|
39,856
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items to be
reclassified subsequently to net income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency translation
adjustment
|
|
|
|
|
|
|
|
|
(net of
income taxes of $nil)
|
|
4,351
|
|
3,452
|
|
11,297
|
|
(9,087)
|
|
|
|
|
|
|
|
|
|
Net unrealized gain on
derivative financial
|
|
|
|
|
|
|
|
|
instruments designated as cash flow hedges
|
|
2,336
|
|
1,258
|
|
7,104
|
|
3,375
|
Tax impact
|
|
(589)
|
|
(315)
|
|
(1,781)
|
|
(849)
|
|
|
|
|
|
|
|
|
|
Loss (gain)
transferred to net income for derivatives
|
|
|
|
|
|
|
|
|
designated as cash flow hedges
|
|
(416)
|
|
(470)
|
|
775
|
|
(1,283)
|
Tax impact
|
|
104
|
|
118
|
|
(196)
|
|
327
|
|
|
|
|
|
|
|
|
|
Cash flow hedge
reserve adjustment
|
|
(12,721)
|
|
(2,426)
|
|
(26,266)
|
|
56
|
Tax impact
|
|
3,181
|
|
607
|
|
6,567
|
|
(14)
|
|
|
|
|
|
|
|
|
|
Other
comprehensive income (loss)
|
|
(3,754)
|
|
2,224
|
|
(2,500)
|
|
(7,475)
|
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
$
|
15,136
|
$
|
6,297
|
$
|
37,769
|
$
|
32,381
|
|
|
|
|
|
|
|
|
|
Attributable
to
|
|
|
|
|
|
|
|
|
Shareholders
|
$
|
15,084
|
$
|
6,207
|
$
|
37,807
|
$
|
32,289
|
Non-controlling
interests
|
|
52
|
|
90
|
|
(38)
|
|
92
|
|
$
|
15,136
|
$
|
6,297
|
$
|
37,769
|
$
|
32,381
|
ATS AUTOMATION TOOLING SYSTEMS
INC.
Interim Consolidated Statements of Changes in
Equity
(in thousands of Canadian dollars - unaudited)
Nine months ended
December 27, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
accumulated
other
comprehensive
income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency
translation
adjustments
|
|
|
|
|
Non-
controlling
interests
|
|
|
|
|
Share
capital
|
|
Contributed
surplus
|
|
Retained
earnings
|
|
|
Cash
flow
hedge
reserve
|
|
|
|
Total
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, as at
March 31, 2020
|
$
|
521,884
|
$
|
11,680
|
$
|
242,076
|
$
|
81,158
|
$
|
11,427
|
$
|
92,585
|
$
|
788
|
$
|
869,013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
––
|
|
––
|
|
40,307
|
|
––
|
|
––
|
|
––
|
|
(38)
|
|
40,269
|
Other comprehensive
income (loss)
|
|
––
|
|
––
|
|
––
|
|
11,297
|
|
(13,797)
|
|
(2,500)
|
|
––
|
|
(2,500)
|
Total comprehensive
income (loss)
|
|
––
|
|
––
|
|
40,307
|
|
11,297
|
|
(13,797)
|
|
(2,500)
|
|
(38)
|
|
37,769
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based
compensation
|
|
––
|
|
574
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
574
|
Exercise of stock
options
|
|
6,521
|
|
(1,169)
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
5,352
|
Repurchase of common
shares (note 12)
|
|
(2,923)
|
|
––
|
|
(5,739)
|
|
––
|
|
––
|
|
––
|
|
––
|
|
(8,662)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, as at
December 27, 2020
|
$
|
525,482
|
$
|
11,085
|
$
|
276,644
|
$
|
92,455
|
$
|
(2,370)
|
$
|
90,085
|
$
|
750
|
$
|
904,046
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine months ended
December 29, 2019
|
|
|
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 April
1,
2019
|
$
|
516,613
|
$
|
11,709
|
$
|
191,228
|
$
|
67,773
|
$
|
1,776
|
$
|
69,549
|
$
|
311
|
$
|
789,410
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
––
|
|
––
|
|
39,764
|
|
––
|
|
––
|
|
––
|
|
92
|
|
39,856
|
Other comprehensive
income (loss)
|
|
––
|
|
––
|
|
––
|
|
(9,087)
|
|
1,612
|
|
(7,475)
|
|
––
|
|
(7,475)
|
Total comprehensive
income
(loss)
|
|
––
|
|
––
|
|
39,764
|
|
(9,087)
|
|
1,612
|
|
(7,475)
|
|
92
|
|
32,381
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-controlling
interest
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
755
|
|
755
|
Stock-based
compensation
|
|
––
|
|
696
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
696
|
Exercise of stock
options
|
|
4,871
|
|
(720)
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
4,151
|
Repurchase of common
shares
|
|
(10)
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
––
|
|
(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance, as at
December 29, 2019
|
$
|
521,474
|
$
|
11,685
|
$
|
230,992
|
$
|
58,686
|
$
|
3,388
|
$
|
62,074
|
$
|
1,158
|
$
|
827,383
|
ATS AUTOMATION TOOLING SYSTEMS
INC.
Interim Consolidated Statements of Cash
Flows
(in thousands of Canadian dollars - unaudited)
|
|
Three months
ended
|
Nine months
ended
|
|
|
|
December
27
|
|
December
29
|
|
December
27
|
|
December
29
|
|
Note
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Operating
activities
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
18,890
|
$
|
4,073
|
$
|
40,269
|
$
|
39,856
|
Items not involving
cash
|
|
|
|
|
|
|
|
|
|
Depreciation of property,
plant and equipment
|
|
|
3,715
|
|
3,785
|
|
11,073
|
|
10,838
|
Amortization of right-of-use
assets
|
7
|
|
3,926
|
|
4,030
|
|
12,176
|
|
11,615
|
Amortization of intangible
assets
|
|
|
9,711
|
|
8,608
|
|
30,291
|
|
30,681
|
Deferred income
taxes
|
13
|
|
(100)
|
|
(2,489)
|
|
(5,443)
|
|
2,844
|
Other items not involving
cash
|
|
|
(400)
|
|
(2,134)
|
|
1,709
|
|
(248)
|
Stock-based
compensation
|
14
|
|
4,891
|
|
4,544
|
|
7,510
|
|
7,221
|
Loss (gain) on disposal of
property, plant
|
|
|
|
|
|
|
|
|
|
and
equipment
|
|
|
(5,348)
|
|
13
|
|
(6,598)
|
|
85
|
|
|
|
35,285
|
|
20,430
|
|
90,987
|
|
102,892
|
Change in non-cash
operating working
capital
|
|
|
43,645
|
|
(27,381)
|
|
55,234
|
|
(92,268)
|
Cash flows
provided by (used
in)
|
|
|
|
|
|
|
|
|
|
operating
activities
|
|
$
|
78,930
|
$
|
(6,951)
|
$
|
146,221
|
$
|
10,624
|
|
|
|
|
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
|
|
|
|
|
Acquisition of
property, plant and equipment
|
|
$
|
(5,134)
|
$
|
(13,718)
|
$
|
(11,052)
|
$
|
(30,237)
|
Acquisition of
intangible
assets
|
|
|
(1,858)
|
|
(2,007)
|
|
(7,413)
|
|
(8,014)
|
Business acquisition,
net of cash acquired
|
4
|
|
(3,050)
|
|
(46,701)
|
|
(3,050)
|
|
(53,367)
|
Proceeds from
disposal of property,
|
|
|
|
|
|
|
|
|
|
plant and
equipment
|
|
|
8,461
|
|
9
|
|
11,525
|
|
82
|
Cash flows used in
investing activities
|
|
$
|
(1,581)
|
$
|
(62,417)
|
$
|
(9,990)
|
$
|
(91,536)
|
|
|
|
|
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
|
|
|
|
|
Bank
indebtedness
|
|
$
|
(4,318)
|
$
|
986
|
$
|
(3,389)
|
$
|
2,345
|
Repayment of
long-term debt
|
|
|
(417)
|
|
(53)
|
|
(302,896)
|
|
(17,057)
|
Proceeds from
long-term
debt
|
|
|
640
|
|
111
|
|
55,720
|
|
177
|
Proceeds from
exercise of stock
options
|
|
|
1,546
|
|
1,877
|
|
5,352
|
|
4,151
|
Repurchase of common
shares
|
|
|
(8,662)
|
|
(10)
|
|
(8,662)
|
|
(10)
|
Lease payments
|
|
|
(3,719)
|
|
(6,190)
|
|
(11,408)
|
|
(13,098)
|
Cash flows used in
financing activities
|
|
$
|
(14,930)
|
$
|
(3,279)
|
$
|
(265,283)
|
$
|
(23,492)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
|
|
|
|
|
|
|
|
and cash
equivalents
|
|
|
(518)
|
|
(258)
|
|
(5,049)
|
|
(2,388)
|
|
|
|
|
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
|
|
61,901
|
|
(72,905)
|
|
(134,101)
|
|
(106,792)
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, beginning of
period
|
|
|
162,643
|
|
190,653
|
|
358,645
|
|
224,540
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
|
$
|
224,544
|
$
|
117,748
|
$
|
224,544
|
$
|
117,748
|
|
|
|
|
|
|
|
|
|
|
Supplemental
information
|
|
|
|
|
|
|
|
|
|
Cash income taxes
paid
|
|
$
|
3,325
|
$
|
5,686
|
$
|
2,946
|
$
|
8,411
|
Cash interest
paid
|
|
$
|
12,581
|
$
|
12,210
|
$
|
29,465
|
$
|
27,140
|
SOURCE ATS Automation Tooling Systems Inc.