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- Improved performance combined with strong
location growth -
WINNIPEG, MB, Aug. 11, 2021 /CNW/ - Boyd Group Services
Inc. (TSX: BYD) ("the Boyd Group", "Boyd" or "the Company") today
announced the results for the three and six month period ended
June 30, 2021. The Boyd Group's second quarter 2021 financial
statements and MD&A have been filed on SEDAR (www.sedar.com).
This news release is not in any way a substitute for reading Boyd's
financial statements, including notes to the financial statements,
and Boyd's Management's Discussion & Analysis.
Results and Highlights for the Second Quarter Ended
June 30, 2021:
- Although still estimated to be below pre-pandemic levels,
demand for collision repair accelerated meaningfully in most U.S.
markets as the second quarter of 2021 progressed, in stark contrast
with the second quarter of 2020 where demand was significantly
diminished due to the COVID-19 pandemic and expenses were
aggressively reduced accordingly
- Sales increased by 44.4% to $444.6
million from $308.0 million in
the same period of 2020, including same-store sales increases of
34.5%, recognizing the same number of selling and production days
in the U.S. and Canada in the
second quarter of 2021 when compared to the same period of 2020.
Same-store sales increases in Canada were much lower than same-store sales
increases in the U.S.
- Adjusted EBITDA1 increased 62.7% to $58.0 million, or 13.0% of sales, including,
$3.6 million of Canada Emergency Wage Subsidy ("CEWS"),
compared with Adjusted EBITDA of $35.6
million, or 11.6% of sales in the same period of 2020, which
included $3.4 million of CEWS
- Adjusted net earnings1 increased to $11.4 million, compared with $4.8 million in adjusted net loss in the same
period of 2020 and adjusted net earnings per share1
increased to $0.53, compared with
adjusted net loss per share of $0.23
in the same period of 2020
- Net earnings increased to $10.5
million, compared with a net loss of $5.0 million in the same period of 2020 and net
earnings per share increased to $0.49, compared with net loss per share of
$0.24 in the same period of 2020
- Cash balance at quarter end of $35.6
million
- Net debt of $671.1 million, with
no significant maturities until March
2025
- Declared second quarter dividend in the amount of C$0.141 per share
- Added 39 locations, including 32 through acquisition, five
intake centers and two start-up locations, as well as a mobile
scanning and calibration business. Included in the locations added
is the acquisition of 16 locations previously operating as John
Harris Body Shops in Georgia and
South Carolina.
Subsequent to Quarter End
- Added 39 locations, including 35 locations previously operating
as Collision Works in Oklahoma,
Kansas and Missouri
"Comparing the second quarter of 2021 to the same period of 2020
demonstrates how significantly the business was impacted by the
pandemic one year ago and how far we have come since that time",
said Timothy O'Day, President and
Chief Executive Officer of the Boyd Group. "During the second
quarter, we saw infection numbers and restrictions decrease, while
vaccination levels increased. We achieved strong same-store
sales growth in the quarter, which resulted in increased Adjusted
EBITDA margins and net earnings, both in the quarter and on a
year-to-date basis. Although we continued to experience
reduced demand in certain markets at the beginning of the second
quarter, demand accelerated in most U.S. markets as the quarter
progressed. By the end of the second quarter, demand in the
U.S. was at meaningfully higher levels than we experienced in the
first quarter of 2021. However, the process of adding
sufficient capacity to meet the increasing level of demand,
including location level administrative staff and technicians,
remains a work in progress."
Results of
Operations
|
For the three
months ended,
June 30,
|
For the six months
ended,
June
30,
|
(thousands of U.S.
dollars, except per share amounts)
|
2021
|
% change
|
2020
|
2021
|
% change
|
2020
|
|
|
|
|
|
|
|
Sales –
Total
|
444,643
|
44.4
|
307,951
|
866,286
|
11.7
|
775,788
|
Same-store sales –
Total
(excluding foreign
exchange)
|
412,038
|
34.5
|
306,453
|
803,121
|
4.9
|
765,832
|
|
|
|
|
|
|
|
Gross margin
%
|
46.1
|
%
|
(1.5)
|
46.8
|
%
|
46.1
|
%
|
1.1
|
45.6
|
%
|
Operating expense
%
|
33.1
|
%
|
(6.0)
|
35.2
|
%
|
33.3
|
%
|
0.3
|
33.2
|
%
|
|
|
|
|
|
|
|
Adjusted EBITDA
1
|
57,996
|
62.7
|
35,637
|
110,744
|
15.2
|
96,126
|
Acquisition and
transaction costs
|
1,102
|
305.1
|
272
|
1,870
|
117.2
|
861
|
Depreciation and
amortization
|
36,395
|
11.9
|
32,529
|
71,131
|
10.8
|
64,221
|
Fair value
adjustments
|
98
|
N/A
|
(72)
|
98
|
N/A
|
(2,263)
|
Finance
costs
|
6,050
|
(35.8)
|
9,424
|
12,782
|
(27.8)
|
17,696
|
Income tax
expense
|
3,889
|
N/A
|
(1,546)
|
6,658
|
84.7
|
3,605
|
|
|
|
|
|
|
|
Adjusted net earnings
(loss) 1
|
11,375
|
N/A
|
(4,841)
|
19,687
|
89.7
|
10,380
|
Adjusted net earnings
(loss) per share 1
|
0.53
|
N/A
|
(0.23)
|
0.92
|
80.4
|
0.51
|
|
|
|
|
|
|
|
Net earnings
(loss)
|
10,462
|
N/A
|
(4,970)
|
18,205
|
51.6
|
12,006
|
Basic earnings (loss)
per share
|
0.49
|
N/A
|
(0.24)
|
0.85
|
46.6
|
0.58
|
Diluted earnings
(loss) per share
|
0.49
|
N/A
|
(0.24)
|
0.85
|
46.6
|
0.58
|
|
|
|
|
|
|
|
|
1.Standardized
EBITDA, Adjusted EBITDA (earnings before interest, income taxes,
depreciation and amortization, adjusted for the non-controlling
interest call liability and contingent consideration, as well as
acquisition and transaction costs), adjusted net earnings and
adjusted net earnings per share are not recognized measures
under International Financial Reporting Standards ("IFRS").
Management believes that in addition to revenue, net earnings and
cash flows, the supplemental measures of adjusted net earnings,
Standardized EBITDA and Adjusted EBITDA are useful as they provide
investors with an indication of earnings from operations and cash
available for distribution, both before and after debt management,
productive capacity maintenance and non-recurring and other
adjustments. Investors should be cautioned, however, that
Standardized EBITDA, Adjusted EBITDA, adjusted net earnings and
adjusted net earnings per share should not be construed as an
alternative to net earnings determined in accordance with IFRS as
an indicator of Boyd's performance. Boyd's method of calculating
these measures may differ from other public issuers and,
accordingly, may not be comparable to similar measures used by
other issuers. For a detailed explanation of how Boyd's non-GAAP
measures are calculated, please refer to Boyd's MD&A filing for
the period ended June 30, 2021, which can be accessed via the
SEDAR Web site (www.sedar.com).
|
Outlook
"While the COVID-19 pandemic significantly
impacted Boyd's business over the past year, we experienced
increased demand in most markets during the second quarter of 2021,
as restrictions continued to ease during this period. Thus
far in the third quarter of 2021, although still below pre-pandemic
levels, demand is exceeding our capacity in all U.S. markets, which
has resulted in high levels of work-in-process. The process
of adding location level administrative staff and technician
capacity to address this constraint remains a work in process and
is resulting in increased wage pressure. By contrast, demand
in Canada remains significantly
lower than pre-pandemic levels. Demand in Canada in the third quarter of 2021 is
building very slowly in comparison with the first and second
quarters of 2021 as restrictions are eased and removed" added Mr.
O'Day. "Looking to the balance of 2021 and beyond, we
continue to be confident that we will maintain progress toward our
long-term growth targets and operational plans. We have added
100 locations on a year-to-date basis and our pipeline to add new
locations in existing markets and to expand into new markets is
healthy. The recent acquisitions of John Harris Body Shops and
Collision Works, which added a combined 51 locations with quality
leadership, are strategically opportunistic and better position us
to execute on our comprehensive plans for accretive market build
out in and around these platforms. In addition to taking time to
execute on our build out plans, as with many acquisitions,
especially those larger in size, it will also take time to
integrate and achieve our expected synergies and resultant earnings
from these acquisitions and other new locations, especially given
the impact of the pandemic. Notwithstanding our strong growth
and positioning for the future, the previously mentioned factors
are contributing to adjusted EBITDA margin pressure with very
modest sequential quarterly same-store sales gains in the third
quarter to date."
2021 Second Quarter Conference Call & Webcast
As previously announced, management will hold a conference call
on Wednesday, August 11, 2021, at
10:00 a.m. (ET) to review the
Company's 2021 second quarter results. You can join the call by
dialing 888-664-6392 or 416-764-8659. A live audio webcast of
the conference call will be available through
www.boydgroup.com. An archived replay of the webcast will be
available for 90 days. A taped replay of the conference call
will also be available until Wednesday,
August 18, 2021, at midnight by calling 1-888-390-0541 or
416-764-8677, reference number 481082#.
About Boyd Group Services Inc.
Boyd Group Services
Inc. is a Canadian corporation and controls The Boyd Group Inc. and
its subsidiaries. Boyd Group Services Inc. shares trade on the
Toronto Stock Exchange (TSX) under the symbol BYD.TO. For more
information on The Boyd Group Inc. or Boyd Group Services Inc.,
please visit our website at https://www.boydgroup.com.
About The Boyd Group Inc.
The Boyd Group Inc. (the
"Company") is one of the largest operators of non-franchised
collision repair centres in North
America in terms of number of locations and sales. The
Company operates locations in Canada under the trade names Boyd Autobody
& Glass (https://www.boydautobody.com) and Assured Automotive
(https://www.assuredauto.ca) as well as in the U.S. under the trade
name Gerber Collision & Glass
(https://www.gerbercollision.com). In addition, the Company is a
major retail auto glass operator in the U.S. with operations under
the trade names Gerber Collision & Glass, Glass America, Auto
Glass Service, Auto Glass Authority and Autoglassonly.com. The
Company also operates a third party administrator, Gerber National
Claims Services ("GNCS"), that offers glass, emergency roadside and
first notice of loss services. For more information on The Boyd
Group Inc. or Boyd Group Services Inc., please visit our website at
(https://www.boydgroup.com).
To view Boyd Group Services Inc. Q2 2021 financial statements
and notes, please click here.
Caution concerning forward-looking statements
Statements made in this press release, other than those
concerning historical financial information, may be forward-looking
and therefore subject to various risks and uncertainties. Some
forward-looking statements may be identified by words like "may",
"will", "anticipate", "estimate", "expect", "intend", or "continue"
or the negative thereof or similar variations. Readers are
cautioned not to place undue reliance on such statements, as actual
results may differ materially from those expressed or implied in
such statements. Factors that could cause results to vary include,
but are not limited to: pandemic risk & economic downturn;
operational performance; acquisition risk; employee relations and
staffing; brand management and reputation; market environment
change; reliance on technology; changes in client relationships;
decline in number of insurance claims; margin pressure and sales
mix changes; environmental, health and safety risk; climate change
and weather conditions; competition; access to capital; foreign
currency risk; dependence on key personnel; tax position risk;
corporate governance; increased government regulation and tax risk;
fluctuations in operating results and seasonality; risk of
litigation; execution on new strategies; insurance risk; interest
rates; U.S. health care costs and workers compensation claims; low
capture rates; supply chain risk; capital expenditures; and energy
costs and the BGSI's success in anticipating and managing the
foregoing risks.
We caution that the foregoing list of factors is not
exhaustive and that when reviewing our forward-looking statements,
investors and others should refer to the "Risk Factors" section of
BGSI's Annual Information Form, the "Risks and Uncertainties" and
other sections of our Management's Discussion and Analysis of
Operating Results and Financial Position and our other periodic
filings with Canadian securities regulatory authorities. All
forward-looking statements presented herein should be considered in
conjunction with such filings.
SOURCE Boyd Group Services Inc.