WINNIPEG, MB, Jan. 12, 2021
/CNW/ - (TSX: NFI) NFI Group Inc. ("NFI" or the
"Company"), one of the world's leading independent bus and coach
manufacturers, today announced that the Company hosted a virtual
Investor Day 2021 on January 11,
2021.
During the event, NFI's Senior Leadership Team and Board
Directors provided detailed presentations regarding NFI's business
and strategy, with a focus on NFI's vision to drive the increased
adoption of zero-emission, electric buses and coaches ("ZEBs"),
what NFI is calling the ZEvolutionTM. The event also
featured an informative discussion by a panel made up of mobility
experts from Canada, the United States, and the United Kingdom.
Highlights from NFI's Investor Day include1:
- reaffirmed NFI's 2020 financial guidance for Adjusted EBITDA of
$145 million to $155 million;
- unveiled 2021 financial guidance with an Adjusted EBITDA range
$220 million to $240 million (implying a year-over-year
improvement of over 50%);
- announced longer-term targets for 2025 including Adjusted
EBITDA of $400 million to
$450 million and a Return on Invested
Capital ("ROIC") target above 12%;
- outlined NFI's strategic plan to lead the transition to ZEBs,
including a target that 35% to 40% of NFI's manufacturing revenue
will come from the sale of ZEBs by 2025;
- a detailed update regarding NFI's Environmental, Social,
Governance ("ESG") program, including the environmental and social
benefits of NFI's products and the Company's internal ESG
performance metrics;
- a thorough review of the transformational "NFI Forward"
initiative, which is expected to generate approximately
$65 million of annualized savings in
2023 and an additional approximate $10
million of positive Free Cash Flow benefits through
permanent reductions in NFI's fixed costs; and
- a panel discussion that explored the impacts of COVID-19 on
public transit, increased government support for ZEBs in
Canada, the United States and the United Kingdom, and the opportunities and
challenges of the transition to zero-emission vehicles.
"It was a pleasure to speak virtually today with our
stakeholders and share our roadmap for the transition to a
zero-emission future," said Paul
Soubry, President and CEO of NFI Group Inc. "We see this not
as a revolution, but an evolution, or as we like to call it a
ZEvolution. Although the transition will take time, it's not a
matter of if, but when. We have been preparing for this change for
decades and are extremely well positioned to capitalize today and
tomorrow as the ZEvolution takes shape."
______________________________________
|
1 The
guidance in this release is driven by numerous expectations and
assumptions of management regarding the Company's future growth,
financial performance and results of operations and the Company's
strategic initiatives, plans, business prospects and
opportunities. Please refer to the Company's press release
relating to this financial guidance dated January 11, 2021, for
more detail regarding these expectations and assumptions. All
dollar amounts in this press release are expressed in U.S.
dollars.
|
"When it comes to ZEBs, NFI has industry-leading manufacturing
capacity, the largest installed fleet, the deepest customer
relationships, and the most reliable aftermarket network," added
Soubry. "We are excited about our position and look forward to the
positive financial and environmental benefits the shift to
zero-emission vehicles will generate."
The event followed the following agenda:
Agenda:
Welcome
|
Stephen King, Group
Director, Treasury, Corporate Development & Investor Relations,
NFI
|
ESG at
NFI
|
Janice Harper,
Executive Vice President, People & Culture, NFI
|
CEO
Commentary
|
Paul Soubry,
President & Chief Executive Officer, NFI
|
Update on NFI
Forward
|
Ian Smart, Executive
Vice President, Business Transformation, NFI
|
Panel with Public
Transit Mobility Experts and Customers
|
David Brown, Group
Chief Executive, the Go Ahead Group
Danny Ilioiu,
Zero-emissions Fleet Strategic Planning Manager, King County Metro
Transit
Dr. Josipa Petrunic,
President & Chief Executive Officer, Canadian Urban Transit
Research & Innovation Consortium (CUTRIC)
Paul Soutelas,
President & Chief Executive Officer, American Public
Transportation Association (APTA)
Moderator: Jennifer
McNeill, Vice President, Sales & Marketing, New Flyer &
MCI
|
Introduction to
the ZEvolutionTM
|
Katherine S. Winter,
NFI Board Director; also the Vice-President & General Manager,
Autonomous Transportation & Infrastructure Division of Intel
Corporation
|
NFI is Leading the
ZEvolutionTM
|
Paul Soubry,
President & Chief Executive Officer, NFI
|
NFI Market &
Business Updates
|
Chris Stoddart,
President, New Flyer and MCI
Doug Minix, General
Manager, ARBOC
Paul Davies,
President & Managing Director, Alexander Dennis
Limited
Brian Dewsnup,
President, NFI Parts
|
NFI Financial
Guidance & Outlook
|
Pipasu Soni,
Executive Vice President, Finance and Chief Financial Officer,
NFI
|
NFI Board
Perspective
|
Hon. Brian V. Tobin,
P.C., O.C., Chairman of the NFI Board of Directors
|
Investor Day 2021 is a starting point for what will be a busy
year for NFI. The Company plans to unveil numerous new products and
services in the coming months, including the launch of a Level 4
automated bus and new electric bus and coach models. Two recent
positive developments related to NFI's ZEB business include:
- NFI subsidiary, Alexander Dennis Limited's ("ADL"),
announcement that its partnership with BYD UK will commence
the design and assembly of chassis for the BYD ADL partnership's
electric single and double deck buses for the British market,
ensuring completed ZEBs are built in ADL's facilities in the UK in
the second half of 2021; and
- New Flyer's announcement of the successful completion of a
battery recycling pilot with North
America's largest lithium-ion battery recycler, Li-Cycle
Corporation.
A close-captioned replay of the Investor Day, along with
presentation materials, is available at the Company's website at:
nfigroup.com/investor-day-2021/, with a transcript to follow in the
near-term.
About NFI Group
Leveraging 450 years of combined experience, NFI is leading the
battery-electric transition of mass mobility around the world. With
zero-emission buses and coaches, infrastructure, and technology,
NFI meets today's urban demands for scalable smart mobility
solutions. Together, NFI is enabling more livable cities through
connected, clean, and sustainable transportation.
NFI is a leading independent global bus manufacturer providing a
comprehensive suite of mass transportation solutions in ten
countries under brands: New Flyer® (heavy-duty transit
buses), Alexander Dennis Limited (single and double-deck buses),
Plaxton (motor coaches), MCI® (motor coaches),
ARBOC® (low-floor cutaway and medium-duty buses), and
NFI Parts™. NFI vehicles incorporate the widest range of drive
systems available, including: clean diesel, natural gas,
diesel-electric hybrid, and zero-emission electric (trolley,
battery, and fuel cell). In total, NFI now supports over 105,000
buses and coaches currently in service around the world.
NFI common shares are traded on the Toronto Stock Exchange under
the symbol NFI. Further information is available at
www.nfigroup.com, www.newflyer.com, www.mcicoach.com,
www.arbocsv.com, www.nfi.parts, and www.alexander-dennis.com.
Non-IFRS Measures
References to "Adjusted EBITDA" are to earnings before interest,
income taxes, depreciation and amortization after adjusting for the
effects of certain non-recurring and/or non-operations related
items that do not reflect the current ongoing cash operations of
the Company as described in the Company's disclosure documents
available on SEDAR at www.sedar.com. References to "ROIC" are
to net operating profit after taxes (calculated as Adjusted EBITDA
less depreciation of plant and equipment, depreciation of
right-of-use assets and income taxes at a rate of 31%) divided by
average invested capital for the last twelve month period
(calculated as to shareholders' equity plus long-term debt,
obligations under leases, other long-term liabilities and
derivative financial instrument liabilities less cash).
Management believes Adjusted EBITDA and ROIC are useful measures
in evaluating the performance of the Company. However, Adjusted
EBITDA and ROIC are not recognized earnings measures under IFRS and
do not have standardized meanings prescribed by IFRS. Readers of
this press release are cautioned that Adjusted EBITDA or ROIC
should not be construed as an alternative to net earnings or loss
or cash flows from operating activities determined in accordance
with IFRS as an indicator of NFI's performance. Historical
reconciliations of net earnings to Adjusted EBITDA has been
provided in the Company's disclosure documents available on SEDAR
at www.sedar.com. NFI's method of calculating Adjusted EBITDA and
ROIC may differ materially from the methods used by other issuers
and, accordingly, may not be comparable to similarly titled
measures used by other issuers.
Forward-Looking Statements
Certain statements in this press release are "forward-looking
statements", which reflect the expectations of management regarding
the Company's future growth, financial performance and results of
operations and the Company's strategic initiatives, plans, business
prospects and opportunities, including the duration, impact of and
recovery from the COVID-19 pandemic. The words "believes", "views",
"anticipates", "plans", "expects", "intends", "projects",
"forecasts", "estimates", "guidance" and "targets", "may", "will"
and similar expressions are intended to identify forward looking
statements. These forward-looking statements reflect management's
current expectations regarding future events (including the
recovery of the Company's markets and the expected benefits to be
obtained through its "NFI Forward" initiative) and the Company's
financial and operating performance and speak only as of the date
of this press release. Forward-looking statements involve
significant risks and uncertainties, should not be read as
guarantees of future events, performance or results, and will not
necessarily be accurate indications of whether or not or the times
at or by which such performance or results will be achieved.
A number of factors that may cause actual results to differ
materially from the results discussed in the forward-looking
statements include: the Company may not be able to achieve its
targets for sales growth, funding may not continue to be available
to the Company's customers at current levels or at all; the
Company's business is affected by economic factors and adverse
developments in economic conditions could have an adverse effect on
the for the Company's products and the results of its operations;
currency fluctuations could adversely affect the Company's
financial results or competitive position; interest rates could
change substantially, materially impacting the Company's revenue
and profitability; an active, liquid trading market for the
Company's common shares (the "Shares") may cease to exist, which
may limit the ability of shareholders to trade Shares; the market
price for the Shares may be volatile; if securities or industry
analysts do not publish research or reports about the Company and
its business, if they adversely change their recommendations
regarding the Shares or if the Company's results of operations do
not meet their expectations, the Share price and trading volume
could decline; in addition, if securities or industry analysts
publish inaccurate or unfavorable research about the Company or its
business, the Share price and trading volume of the Shares could
decline; competition in the industry and entrance of new
competitors; current requirements under "Buy America" regulations
may change and/or become more onerous or suppliers' "Buy America"
content may change; failure of the Company to comply with the U.S.
Disadvantaged Business Enterprise ("DBE") program requirements or
the failure to have its DBE goals approved by the U.S. Federal
Transit Administration; absence of fixed term customer contracts,
exercise of options and customer suspension or termination for
convenience; local content bidding preferences in the United States may create a competitive
disadvantage; uncertainty resulting from the exit of the UK from
the European Union; requirements under Canadian content policies
may change and/or become more onerous; operational risk resulting
from inadequate or failed internal processes, people and/or systems
or from external events, including fiduciary breaches, regulatory
compliance failures, legal disputes, business disruption,
pandemics, floods, technology failures, processing errors, business
integration, damage to physical assets, employee safety and
insurance coverage; international operations subject the Company to
additional risks and costs and may cause profitability to decline;
dependence on limited sources or unique sources of supply;
dependence on supply of engines that comply with emission
regulations; a disruption, termination or alteration of the supply
of vehicle chassis or other critical components from third-party
suppliers could materially adversely affect the sales of certain of
the Company's products; the Company's profitability can be
adversely affected by increases in raw material and component
costs; the Company may incur material losses and costs as a result
of product warranty costs, recalls and remediation of transit buses
and motor coaches; production delays may result in liquidated
damages under the Company's contracts with its customers;
catastrophic events may lead to production curtailments or
shutdowns; the Company may not be able to successfully renegotiate
collective bargaining agreements when they expire and may be
adversely affected by labour disruptions and shortages of labour;
the Company's operations are subject to risks and hazards that may
result in monetary losses and liabilities not covered by insurance
or which exceed its insurance coverage; the Company may be
adversely affected by rising insurance costs; the Company may not
be able to maintain performance bonds or letters of credit required
by its contracts or obtain performance bonds and letters of credit
required for new contracts; the Company is subject to litigation in
the ordinary course of business and may incur material losses and
costs as a result of product liability claims; the Company may have
difficulty selling pre-owned coaches and realizing expected resale
values; the Company may incur costs in connection with regulations
relating to axle weight restrictions and vehicle lengths; the
Company may be subject to claims and liabilities under
environmental, health and safety laws; dependence on management
information systems and cyber security risks; the Company's ability
to execute its strategy and conduct operations is dependent upon
its ability to attract, train and retain qualified personnel,
including its ability to retain and attract executives, senior
management and key employees; the Company may be exposed to
liabilities under applicable anti-corruption laws and any
determination that it violated these laws could have a material
adverse effect on its business; the Company's risk management
policies and procedures may not be fully effective in achieving
their intended purposes; internal controls over financial
reporting, no matter how well designed, have inherent limitations;
there are inherent limitations to the effectiveness of any system
of disclosure controls and procedures, including the possibility of
human error and the circumvention or overriding of the controls and
procedures; ability to successfully execute strategic plans and
maintain profitability; development of competitive or disruptive
products, services or technology; development and testing of new
products or model variants; acquisition risk; reliance on
third-party manufacturers; third-party distribution/dealer
agreements; availability to the Company of future financing; the
Company may not be able to generate the necessary amount of cash to
service its existing debt, which may require the Company to
refinance its debt; the restrictive covenants in the credit
facilities could impact the Company's business and affect its
ability to pursue its business strategies; payment of dividends is
not guaranteed; a significant amount of the Company's cash is
distributed, which may restrict potential growth; the Company is
dependent on its subsidiaries for all cash available for
distributions; future sales or the possibility of future sales of a
substantial number of Shares may impact the price of the Shares and
could result in dilution; if the Company is required to write down
goodwill or other intangible assets, its financial condition and
operating results would be negatively affected; income tax risk due
to the Company's operations being complex and income tax
interpretations, regulations and legislation that pertain to its
activities are subject to continual change; investment eligibility
and Canadian federal income tax risks; certain U.S. tax rules may
limit the ability of NF Holdings and its U.S. subsidiaries (the "NF
Group") to deduct interest expense for U.S. federal income tax
purposes and may increase the NF Group's tax liability and certain
financing transactions could be characterized as "hybrid
transactions" for U.S. tax purposes, which could increase the NF
Group's tax liability.
Factors relating to the global COVID-19 pandemic include: the
magnitude and duration of the global, national and regional
economic and social disruption being caused as a result of the
pandemic; the impact of national, regional and local governmental
laws, regulations and "shelter in place" or similar orders relating
to the pandemic which may materially adversely impact the Company's
ability to continue operations; partial or complete closures of
one, more or all of the Company's facilities and work locations or
the reduction of production rates (including due to government
mandates and to protect the health and safety of the Company's
employees or as a result of employees being unable to come to work
due to COVID-19 infections with respect to them or their family
members); production rates may be further decreased as a result of
the pandemic; supply delays and shortages of parts and components
and disruption to labour supply as a result of the pandemic; the
pandemic will likely adversely affect operations of customers and
reduce and delay, for an unknown period, customers' purchases of
the Company's products; the anticipated recovery of the Company's
markets in the future may be delayed or increase in demand may be
lower than expected as a result of the continuing effects of the
pandemic; the Company's ability to obtain access to additional
capital if required; and the Company's financial performance and
condition, obligations, cash flow and liquidity and its ability to
maintain compliance with the covenants under its credit
facilities, which may also negatively impact the ability of the
Company to pay dividends. There can be no assurance that the
Company will be able to maintain sufficient liquidity for an
extended period, obtain future satisfactory covenant relief under
its credit facilities, if required, or access to additional capital
or access to government financial support or as to when production
operations will return to previous production rates. There is also
no assurance that governments will provide continued or adequate
stimulus funding during or after the pandemic for public transit
agencies to purchase transit vehicles or that public or private
demand for the Company's vehicles will return to pre-pandemic
levels in the anticipated period of time. The Company cautions that
due to the dynamic, fluid and highly unpredictable nature of the
pandemic and its impact on global and local economies, businesses
and individuals, it is impossible to predict the severity of the
impact on the Company's business, operating performance, financial
condition and ability to generate sufficient cash flow and maintain
adequate liquidity and any material adverse effects could very well
be rapid, unexpected and may continue for an extended and unknown
period of time.
Factors relating to the Company's "NFI Forward" initiative
include: the Company's ability to successfully execute the
initiative and to generate the planned savings in the expected time
frame or at all; management may have overestimated the amount of
savings and production efficiencies that can be generated or may
have underestimated the amount of costs to be expended; the
implementation of the initiative may take longer than planned to
achieve the expected savings; further restructuring and
cost-cutting may be required in order to achieve the objectives of
the initiative; the estimated amount of savings generated under the
initiative may not be sufficient to achieve the planned benefits;
combining business units and/or reducing the number of production
or parts facilities may not achieve the efficiencies anticipated;
and the impact of the continuing global COVID-19 pandemic. There
can be no assurance that the Company will be able to achieve the
anticipated financial and operational benefits, cost savings or
other benefits of the initiative.
The Company cautions that the foregoing factors are not
exhaustive of all potential risks. These factors and other risks
and uncertainties are discussed in the Company's press releases,
Annual Information Form and materials filed with the Canadian
securities regulatory authorities which are available on SEDAR at
www.sedar.com. Due to the potential impact of these and other
factors, the Company disclaims any intention or obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, unless
required by applicable law.
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SOURCE NFI Group Inc.