Velan Inc. Reports Its Second Quarter 2023/24 Financial Results
October 05 2023 - 7:25PM
Velan Inc. (TSX: VLN) (the “Company”), a world-leading manufacturer
of industrial valves, announced today its financial results for its
second quarter ended August 31, 2023.
Highlights:
- Order backlog2
remains strong at $485.7 million, an increase of $21.3 million or
4.6% since the beginning of the year. The increase in backlog2 is
primarily attributable to changes in the profile of scheduled
backlog2 shipment dates. The portion of the current backlog2
deliverable in the next twelve months is $339.4 million.
- Net new orders
(“bookings”)2 of $71.5 million for the quarter, a decrease of $2.0
million or 2.7% compared to last year. The decrease in bookings2 is
primarily attributable to a reduction in MRO distributor orders as
well as lower process and mining orders, partially offset by a
pick-up in oil and gas orders compared to last year.
- Sales for the
quarter amounted to $80.3 million, an improvement of $12.7 million
or 18.7% compared to the first quarter of the current fiscal year,
a decrease of $4.7 million or 5.6% compared to the second quarter
of the previous fiscal year. The decrease in sales for the quarter
compared to the prior year is primarily attributable to delays on
certain shipments caused by customer readiness issues and a
shortage of deliverable orders in the Company’s Italian
operations.
- Gross profit for
the quarter amounted to $23.4 million or 29.1% compared to last
year’s $23.5 million or 27.6%. Gross profit improved by $8.3
million or 690 basis points compared to the first quarter of the
current fiscal year. Gross profit percentage for the quarter was a
result of improved product mix offsetting the lower sales volume
and unfavorable unrealized foreign exchange translations compared
to last year.
- Net loss1 of
$2.1 million and EBITDA3 of $3.0 million for the quarter compared
to a net loss1 of $3.7 million and EBITDA2 of $1.4 million last
year. The increase in EBITDA2 is primarily attributable to a $2.1
million decrease in administration costs.
- The Company’s
net cash amounted to $39.4 million at the end of the quarter, a
decrease of $19.3 million compared to the $58.6 million net cash
balance at the beginning of the quarter. The decrease in net cash
for the quarter is primarily related to temporary unfavorable
movements in working capital, notably in accounts receivable,
inventories and accounts payable and accrued liabilities as the
Company prepares for its ramp-up in Q3 and Q4 of the current year.
The overall available liquidity remains strong with $122.1 million
of available cash-on-hand and facilities.
- The Company
announced earlier today that it has been verbally informed that the
French Ministry of Economy is refusing to grant its approval in
connection with the change of control of Segault S.A.S. and Velan
S.A.S. as part of the overall sale of Velan Inc. to Flowserve. As a
result, Flowserve informed the Company that they intend to
terminate the arrangement agreement on October 7, 2023.
Bruno Carbonaro, CEO and President of Velan
Inc., said, “Our second quarter was an improvement in terms of
results when compared to our second quarter of last year, as we
partly recovered from some of the delays experienced at the start
of the year. We are now focused on the ramp-up for the second half
of the year. We continue to manage our business prudently with
specific focus around executing on our backlog while working on a
pipeline of opportunities. We will ensure to benefit from the
working capital investments we made in the first half of the fiscal
year by working diligently on increasing our collections and
reducing our inventories on hand during the latter part of the
year. Our North American commercial operations are tapping into new
and emerging markets while we also continue to see growth in the
nuclear business activities in France. Finally, the Board, the
Velan family and Flowserve are obviously disappointed with the
outcome and the decision of the French regulators. The Board
recognizes, appreciates, and wants to thank the executives, the
management team, the integration team, and all employees at Velan
and outside stakeholders who have done everything possible and who
worked tirelessly to support the transaction and make it happen.
The board and executive leadership are very confident in our strong
future, and we will resume operations as an independent business,
free of the covenants and other restrictions of the arrangement
agreement.”
Financial Highlights:
|
Three-month periods ended |
Six-month periods ended |
(thousands of U.S. dollars, excluding per share amounts) |
August 31, 2023 |
August 31, 2022 |
August 31, 2023 |
August 31, 2022 |
|
|
|
|
|
Sales |
$80,318 |
$85,054 |
$147,977 |
$160,059 |
Gross profit |
23,385 |
23,482 |
38,437 |
43,555 |
Gross profit % |
29.1% |
27.6% |
26.0% |
27.2% |
Net loss1 |
(2,120) |
(3,676) |
(10,404) |
(11,028) |
Net loss1 per share – basic
and diluted |
(0.10) |
(0.17) |
(0.48) |
(0.51) |
EBITDA2 |
2,960 |
1,365 |
(839) |
(1,513) |
EBITDA2 per share – basic and
diluted |
0.14 |
0.06 |
(0.04) |
(0.07) |
Second Quarter Fiscal 2024 (unless otherwise
noted, all amounts are in U.S. dollars and all comparisons are to
the second quarter of fiscal 2023):
- Sales amounted
to $80.3 million for the quarter, decreasing by $4.7 million or
5.6% compared to the same quarter last year. The decrease in sales
for the quarter is primarily attributable to lower shipments of
large orders by the Company’s Italian operations due to a reduction
of these orders recorded in the previous fiscal year. The decrease
in sales for the quarter was also caused by delays on certain
shipments caused by customer readiness issues. Otherwise, the
decrease was partially offset by the positive impact of the
strengthening of the euro average rate against the U.S. dollar on
sales which amounted to $2.1 million for the quarter compared to
last fiscal year. Finally, sales for the quarter were also
positively impacted by favorable revaluations of the Company’s
provision for performance guarantees and volume rebate
accrual.
- Bookings2 for
the quarter amounted to $71.5 million, a decrease of $2.0 million
or 2.7% compared to the second quarter of last year. The decrease
for the quarter is primarily attributable to lower orders recorded
by the Company’s North American operations. The decrease in North
American bookings2 for the quarter is partly attributable to a
reduction in MRO distributor orders, due in part to higher
re-stocking orders in the previous year but also a slowdown
currently observed in some covered markets. Additionally, the
reduction in North American bookings2 for the quarter was also due
to lower process and mining orders compared to last year. The
decrease in bookings2 for the quarter was partially offset by
higher oil and gas bookings2 recorded in the Company’s Italian
operations. Finally, the decrease in bookings2 was also partially
compensated by the strengthening of the euro average rate against
the U.S. dollar on bookings2 for the Company’s European operations
which resulted in a favorable impact of $2.3 million in the second
quarter compared to the prior year.
- Gross profit for
the quarter amounted to $23.4 million, a decrease of $0.1 million
or 0.4% compared to the second quarter of last year. The gross
profit percentage for the quarter of 29.1% was an increase of 150
basis points compared to last year’s second quarter. The slight
decrease in gross profit for the quarter is primarily due to the
lower sales volume which impacted the absorption of fixed
production overhead costs as well as unfavorable unrealized foreign
exchange translations related to the fluctuation of the U.S. dollar
against the euro and the Canadian dollar when compared to similar
movements from the previous year. This decrease in gross profit for
the quarter was offset by an improved product mix as well as
favorable revaluations of the Company’s provision for performance
guarantees and volume rebate accrual.
- Administration
costs for the quarter amounted to $22.6 million, a decrease of $2.1
million or 8.5%. The decrease in administration costs for the
quarter is primarily attributable to the recording in the last
quarter of the previous fiscal year of an asbestos provision for
potential settlement value of future unknown claims. The settlement
expense amounted to $3.1 million in the second quarter of fiscal
2023. The decrease in administration costs for the quarter is also
due to lower outbound freight costs which have now stabilized and
sales commissions in relation to the lower sales volume. Finally,
the decrease for the quarter was partially offset by a general
increase in administration costs.
- Net loss1
amounted to $2.1 million or $0.10 per share compared to a net loss1
of $3.7 million or $0.17 per share last year. EBITDA2 for the
quarter amounted to $3.0 million or $0.14 per share compared to
$1.4 million or $0.06 per share last year. The favorable movement
in EBITDA2 for the quarter is primarily attributable to the
previously explained decrease in administration costs, partially
offset by an increase in other expense. The positive movement in
the Company’s results was primarily attributable to the previously
mentioned factors combined with a favorable movement in income
taxes and an unfavorable movement in finance costs.
First Six months Fiscal 2024 (unless otherwise
noted, all amounts are in U.S. dollars and all comparisons are to
the first six months of fiscal 2023):
- Sales for the
half year totaled $148.0 million, a decrease of $12.1 or 7.5%
compared to the last fiscal year. The decrease in sales for the
half year is primarily attributable to lower shipments of large
orders by the Company’s Italian operations due to a reduction of
these orders recorded in the previous fiscal year. The decrease for
the half year was also due to accelerated shipments in the fourth
quarter of the prior fiscal year as a result of customer demand and
the Company’s increased production ramp-up. The decrease in sales
for the half year was partially offset by increased shipments in
the Company’s North American operations. Otherwise, the decrease
was also partially offset by the positive impact of the
strengthening of the euro average rate against the U.S. dollar on
sales which amounted to $2.1 million for the half year compared to
last fiscal year. Finally, sales for the half year were also
positively impacted by favorable revaluations of the Company’s
provision for performance guarantees and volume rebate
accrual.
- Bookings2 for
the half year amounted to $163.4 million, a decrease of $3.6
million or 2.1% compared to the prior fiscal year. The decrease for
the half year is primarily attributable to lower orders recorded by
the Company’s North American operations. The decrease in North
American bookings2 for the half year is partly attributable to a
reduction in MRO distributor orders, due in part to higher
re-stocking orders in the previous year but also a slowdown
currently observed in some covered markets. Additionally, the
reduction in North American bookings2 for the half year was also
due to lower process orders compared to last year. The decrease in
bookings2 for the half year was partially offset by higher oil and
gas bookings2 recorded in the Company’s Italian operations and an
increase in nuclear orders recorded by the Company’s French
operations. Finally, the decrease in bookings2 was also partially
compensated by the strengthening of the euro average rate against
the U.S. dollar on bookings2 for the Company’s European operations
which resulted in a favorable impact of $2.7 million on the half
year compared to the prior year.
- The total
backlog2 increased by $21.3 million or 4.6% since the beginning of
the fiscal year, settling at $485.7 million at the end of the
quarter. The increase in backlog2 is primarily attributable to
changes in the profile of scheduled backlog2 shipment dates. The
increase in backlog2 is also due to the strengthening of the euro
spot rate against the U.S. dollar since the beginning of the fiscal
year which represented $6.5 million.
- Gross profit for
the half year amounted to $38.4 million, a decrease of $5.1 million
or 11.8% compared to the prior fiscal year. The gross profit
percentage for the six-month period of 26.0% represented a decrease
of 120 basis points compared to the same period last year. The
decrease in gross profit for the half year is primarily due to the
lower sales volume which impacted the absorption of fixed
production overhead costs as well as unfavorable unrealized foreign
exchange translations related to the fluctuation of the U.S. dollar
against the euro and the Canadian dollar when compared to similar
movements from the previous year. This decrease in gross profit for
the half year was partially offset by an improved product mix as
well as favorable revaluations of the Company’s provision for
performance guarantees and volume rebate accrual.
- Administration
costs for the half year amounted to $44.1 million, a decrease of
$6.4 million or 12.7%. The decrease in administration costs for the
half year is primarily attributable to the recording in the last
quarter of the previous fiscal year of an asbestos provision for
potential settlement value of future unknown claims. The settlement
expense amounted to $6.3 million in the first six months of fiscal
2023. The decrease in administration costs for the half year is
also due to lower outbound freight costs which have now stabilized
and sales commissions in relation to the lower sales volume.
Finally, the decrease for the half year was partially offset by a
general increase in administration costs.
- Net loss1 for
the half year amounted to $10.4 million or $0.48 per share compared
to $11.0 million or $0.51 per share last year. EBITDA2 for the half
year amounted to negative $0.8 million or negative $0.04 per share
compared to negative $1.5 million or negative $0.07 per share last
year. The favorable movement in EBITDA2 for the six-month period is
primarily attributable to the previously explained decrease in
administration costs, partially offset by a decrease in gross
profit and an increase in other expense. The positive movement in
the Company’s results was primarily attributable to the same
factors as previously explained combined with a favorable movement
in income taxes and an unfavorable movement in finance costs.
Dividend
The Company opted to declare no dividend this
quarter.
Conference call
Financial analysts, shareholders, and other
interested individuals are invited to attend the second quarter
conference call to be held on Friday, October 6, 2023, at 11:00
a.m. (EDT). The toll-free call-in number is 1-800-945-0427, access
code 22028032. The material that will be referenced during the
conference call will be made available shortly before the
event on the company’s website under the Investor Relations section
(https://www.velan.com/en/company/investor_relations). A recording
of this conference call will be available for seven days at
1-416-626-4100 or 1-800-558-5253, access code 22028032.
About Velan
Founded in Montreal in 1950, Velan Inc.
(www.velan.com) is one of the world’s leading manufacturers of
industrial valves, with sales of US$370.4 million in its last
reported fiscal year. The Company employs approximately 1,650
people and has manufacturing plants in 9 countries. Velan Inc. is a
public company with its shares listed on the Toronto Stock Exchange
under the symbol VLN.
Safe harbour statement
This news release may include forward-looking
statements, which generally contain words like “should”, “believe”,
“anticipate”, “plan”, “may”, “will”, “expect”, “intend”, “continue”
or “estimate” or the negatives of these terms or variations of them
or similar expressions, all of which are subject to risks and
uncertainties, which are disclosed in the Company’s filings with
the appropriate securities commissions. While these statements are
based on management’s assumptions regarding historical trends,
current conditions and expected future developments, as well as
other factors that it believes are reasonable and appropriate in
the circumstances, no forward-looking statement can be guaranteed
and actual future results may differ materially from those
expressed herein. The Company disclaims any intention or obligation
to update or revise any forward-looking statements contained herein
whether as a result of new information, future events or otherwise,
except as required by the applicable securities laws. The
forward-looking statements contained in this news release are
expressly qualified by this cautionary statement.
Non-IFRS and supplementary financial
measures
In this press release, the Company has presented
measures of performance or financial condition which are not
defined under IFRS (“non-IFRS measures”) and are, therefore,
unlikely to be comparable to similar measures presented by other
companies. These measures are used by management in assessing the
operating results and financial condition of the Company and are
reconciled with the performance measures defined under IFRS.
Company has also presented supplementary financial measures which
are defined at the end of this report. Reconciliation and
definition can be found on the next page.
Earnings (loss) before interest, taxes,
depreciation and amortization ("EBITDA")
|
Three-month periods ended |
|
Six-month periods ended |
|
(thousands, except amount per shares) |
August 31, 2023$ |
|
August 31, 2022$ |
|
August 31, 2023$ |
|
August 31, 2022$ |
|
|
|
|
|
|
Net loss1 |
(2,120 |
) |
(3,676 |
) |
(10,404 |
) |
(11,028 |
) |
|
|
|
|
|
Adjustments for: |
|
|
|
|
Depreciation of property, plant and equipment |
2,154 |
|
2,023 |
|
4,220 |
|
4,184 |
|
Amortization of intangible assets and financing costs |
514 |
|
556 |
|
1,077 |
|
1,124 |
|
Finance
costs – net |
1,391 |
|
378 |
|
2,596 |
|
614 |
|
Income taxes |
1,021 |
|
2,084 |
|
1,672 |
|
3,593 |
|
|
|
|
|
|
EBITDA |
2,960 |
|
1,365 |
|
(839 |
) |
(1,513 |
) |
EBITDA
per share |
|
|
|
|
- Basic and diluted |
0.14 |
|
0.06 |
|
(0.04 |
) |
(0.07 |
) |
The term “EBITDA” is defined as net income or
loss attributable to Subordinate and Multiple Voting Shares plus
depreciation of property, plant & equipment, plus amortization
of intangible assets and financing costs, plus net finance costs
plus income tax provision. The terms “EBITDA per share” is obtained
by dividing EBITDA by the total amount of subordinate and multiple
voting shares. The forward-looking statements contained in this
press release are expressly qualified by this cautionary
statement.
Definitions of supplementary financial
measures
The term “Net new orders” or “bookings” is
defined as firm orders, net of cancellations, recorded by the
Company during a period. Bookings are impacted by the fluctuation
of foreign exchange rates for a given period. The measure provides
an indication of the Company’s sales operation performance for a
given period as well as well as an expectation of future sales and
cash flows to be achieved on these orders.
The term “backlog” is defined as the buildup of
all outstanding bookings to be delivered by the Company. The
Company’s backlog is impacted by the fluctuation of foreign
exchange rates for a given period. The measure provides an
indication of the future operational challenges of the Company as
well as an expectation of future sales and cash flows to be
achieved on these orders.
The term “book-to-bill” is obtained by dividing
bookings by sales. The measure provides an indication of the
Company’s performance and outlook for a given period.
The forward-looking statements contained in this
press release are expressly qualified by this cautionary
statement.
1 Non-IFRS and supplementary financial measures – see
explanation above2 Net earnings or loss refer to net income or loss
attributable to Subordinate and Multiple Voting Shares
|
|
|
|
|
Consolidated Statements of Financial Position |
|
|
|
|
(in thousands of U.S. dollars) |
|
|
|
|
|
|
|
As at |
|
|
|
August 31, |
February 28, |
|
|
|
2023 |
2023 |
|
|
|
$ |
$ |
|
Assets |
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
|
41,474 |
50,513 |
|
Short-term investments |
|
17 |
37 |
|
Accounts receivable |
|
99,280 |
121,053 |
|
Income taxes recoverable |
|
6,343 |
6,195 |
|
Inventories |
|
225,868 |
202,649 |
|
Deposits and prepaid expenses |
|
9,051 |
7,559 |
|
Derivative assets |
|
141 |
107 |
|
|
|
382,174 |
388,113 |
|
|
|
|
|
|
Non-current assets |
|
|
|
|
Property, plant and equipment |
|
70,095 |
68,205 |
|
Intangible assets and goodwill |
|
16,253 |
16,153 |
|
Deferred income taxes |
|
4,849 |
4,663 |
|
Other assets |
|
653 |
723 |
|
|
|
|
|
|
|
|
91,850 |
89,744 |
|
|
|
|
|
|
Total assets |
|
474,024 |
477,857 |
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
Bank indebtedness |
|
2,102 |
260 |
|
Accounts payable and accrued liabilities |
|
74,925 |
79,408 |
|
Income taxes payable |
|
1,562 |
2,832 |
|
Customer deposits |
|
30,163 |
28,201 |
|
Provisions |
|
18,495 |
16,485 |
|
Derivative liabilities |
|
31 |
299 |
|
Current portion of long-term lease liabilities |
|
1,643 |
1,298 |
|
Current portion of long-term debt |
|
13,353 |
8,177 |
|
|
|
142,274 |
136,960 |
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Long-term lease liabilities |
|
11,450 |
9,458 |
|
Long-term debt |
|
20,029 |
21,719 |
|
Income taxes payable |
|
519 |
933 |
|
Deferred income taxes |
|
4,172 |
3,966 |
|
Customer deposits |
|
31,420 |
27,937 |
|
Provisions |
|
66,041 |
70,924 |
|
Other liabilities |
|
5,084 |
5,125 |
|
|
|
|
|
|
|
|
138,715 |
140,062 |
|
|
|
|
|
|
Total liabilities |
|
280,989 |
277,022 |
|
|
|
|
|
|
Total equity |
|
193,035 |
200,835 |
|
|
|
|
|
|
Total liabilities and equity |
|
474,024 |
477,857 |
|
|
|
|
|
|
Consolidated Statements of Loss |
|
|
|
|
|
(in thousands of U.S. dollars, excluding number of shares and per
share amounts) |
|
|
|
|
Three-month periods ended |
|
|
Six-month periods ended |
|
|
August 31, |
|
August 31, |
|
|
August 31, |
|
August 31, |
|
|
2023 |
|
2022 |
|
|
2023 |
|
2022 |
|
|
$ |
|
$ |
|
|
$ |
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
80,318 |
|
85,054 |
|
|
147,977 |
|
160,059 |
|
|
|
|
|
|
|
Cost of sales |
56,933 |
|
61,572 |
|
|
109,540 |
|
116,504 |
|
|
|
|
|
|
|
Gross profit |
23,385 |
|
23,482 |
|
|
38,437 |
|
43,555 |
|
|
|
|
|
|
|
Administration costs |
22,571 |
|
24,678 |
|
|
44,070 |
|
50,490 |
|
Other expense (income) |
525 |
|
7 |
|
|
512 |
|
(134 |
) |
|
|
|
|
|
|
Operating income (loss) |
289 |
|
(1,203 |
) |
|
(6,145 |
) |
(6,801 |
) |
|
|
|
|
|
|
Finance income |
136 |
|
78 |
|
|
271 |
|
168 |
|
Finance costs |
(1,527 |
) |
(456 |
) |
|
(2,867 |
) |
(782 |
) |
|
|
|
|
|
|
Finance costs – net |
(1,391 |
) |
(378 |
) |
|
(2,596 |
) |
(614 |
) |
|
|
|
|
|
|
Loss before income taxes |
(1,102 |
) |
(1,581 |
) |
|
(8,741 |
) |
(7,415 |
) |
|
|
|
|
|
|
Income tax expense |
1,021 |
|
2,084 |
|
|
1,672 |
|
3,593 |
|
|
|
|
|
|
|
Net loss for the period |
(2,123 |
) |
(3,665 |
) |
|
(10,413 |
) |
(11,008 |
) |
|
|
|
|
|
|
Net income (loss) attributable to: |
|
|
|
|
|
Subordinate Voting Shares and Multiple Voting
Shares |
(2,120 |
) |
(3,676 |
) |
|
(10,404 |
) |
(11,028 |
) |
Non-controlling interest |
(3 |
) |
11 |
|
|
(9 |
) |
20 |
|
|
|
|
|
|
|
Net loss for the period |
(2,123 |
) |
(3,665 |
) |
|
(10,413 |
) |
(11,008 |
) |
|
|
|
|
|
|
Net loss per Subordinate and Multiple Voting
Share |
|
|
|
|
|
Basic and diluted |
(0.10 |
) |
(0.17 |
) |
|
(0.48 |
) |
(0.51 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per Subordinate and
Multiple |
- |
|
- |
|
|
0.02 |
|
0.02 |
|
Voting Share |
(CA$ - ) |
(CA$ - ) |
|
(CA$0.03) |
(CA$0.03) |
|
|
|
|
|
|
|
|
|
|
|
|
Total weighted average number of Subordinate
and |
|
|
|
|
|
Multiple Voting Shares |
|
|
|
|
|
Basic and diluted |
21,585,635 |
|
21,585,635 |
|
|
21,585,635 |
|
21,585,635 |
|
|
|
|
|
|
|
Consolidated Statements of Comprehensive Loss |
|
|
|
(in thousands of U.S. dollars) |
|
|
|
|
|
|
Three-month periods ended |
|
|
Six-month periods ended |
|
|
August 31, |
|
August 31, |
|
|
August 31, |
|
August 31, |
|
|
2023 |
|
2022 |
|
|
2023 |
|
2022 |
|
|
$ |
|
$ |
|
|
$ |
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss |
|
|
|
|
|
|
|
|
|
|
|
Net loss for the period |
(2,123 |
) |
(3,665 |
) |
|
(10,413 |
) |
(11,008 |
) |
|
|
|
|
|
|
Other comprehensive income (loss) |
|
|
|
|
|
Foreign currency translation |
1,696 |
|
(7,760 |
) |
|
3,104 |
|
(13,591 |
) |
|
|
|
|
|
|
Comprehensive loss |
(427 |
) |
(11,425 |
) |
|
(7,309 |
) |
(24,599 |
) |
|
|
|
|
|
|
Comprehensive income (loss) attributable to: |
|
|
|
|
|
Subordinate Voting Shares and Multiple Voting Shares |
(424 |
) |
(11,437 |
) |
|
(7,300 |
) |
(24,619 |
) |
Non-controlling interest |
(3 |
) |
12 |
|
|
(9 |
) |
20 |
|
|
|
|
|
|
|
Comprehensive loss |
(427 |
) |
(11,425 |
) |
|
(7,309 |
) |
(24,599 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss is composed solely of items that may be
reclassified subsequently to the consolidated statement of
loss. |
|
|
|
|
|
|
Consolidated Statements of Changes in Equity |
|
|
|
|
|
(in thousands of U.S. dollars, excluding number of shares) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to the Subordinate and Multiple Voting
shareholders |
|
|
|
Share capital |
Contributed surplus |
Accumulated other comprehensive loss |
Retained earnings |
Total |
Non-controlling interest |
Total equity |
|
|
|
|
|
|
|
|
Balance - February 28, 2022 |
72,695 |
6,260 |
(32,126 |
) |
217,995 |
|
264,824 |
|
686 |
|
265,510 |
|
|
|
|
|
|
|
|
|
Net income (loss) for the period |
- |
- |
- |
|
(11,028 |
) |
(11,028 |
) |
20 |
|
(11,008 |
) |
Other comprehensive loss |
- |
- |
(13,591 |
) |
- |
|
(13,591 |
) |
- |
|
(13,591 |
) |
|
|
|
|
|
|
|
|
Comprehensive income (loss) |
- |
- |
(13,591 |
) |
(11,028 |
) |
(24,619 |
) |
20 |
|
(24,599 |
) |
|
|
|
|
|
|
|
|
Other |
- |
- |
(97 |
) |
97 |
|
- |
|
- |
|
- |
|
Dividends |
|
|
|
|
|
|
|
Multiple Voting Shares |
- |
- |
- |
|
(366 |
) |
(366 |
) |
- |
|
(366 |
) |
Subordinate Voting Shares |
- |
- |
- |
|
(131 |
) |
(131 |
) |
- |
|
(131 |
) |
|
|
|
|
|
|
|
|
Balance - August 31, 2022 |
72,695 |
6,260 |
(45,814 |
) |
206,567 |
|
239,708 |
|
706 |
|
240,414 |
|
|
|
|
|
|
|
|
|
Balance - February 28, 2023 |
72,695 |
6,260 |
(41,208 |
) |
162,142 |
|
199,889 |
|
946 |
|
200,835 |
|
|
|
|
|
|
|
|
|
Net loss for the period |
- |
- |
- |
|
(10,404 |
) |
(10,404 |
) |
(9 |
) |
(10,413 |
) |
Other comprehensive income |
- |
- |
3,104 |
|
- |
|
3,104 |
|
- |
|
3,104 |
|
|
|
|
|
|
|
|
|
Comprehensive income (loss) |
- |
- |
3,104 |
|
(10,404 |
) |
(7,300 |
) |
(9 |
) |
(7,309 |
) |
|
|
|
|
|
|
|
|
Dividends |
|
|
|
|
|
|
|
Multiple Voting Shares |
- |
- |
- |
|
(354 |
) |
(354 |
) |
- |
|
(354 |
) |
Subordinate Voting Shares |
- |
- |
- |
|
(137 |
) |
(137 |
) |
- |
|
(137 |
) |
|
|
|
|
|
|
|
|
Balance - August 31, 2023 |
72,695 |
6,260 |
(38,104 |
) |
151,247 |
|
192,098 |
|
937 |
|
193,035 |
|
|
|
|
|
|
|
|
|
Consolidated Statements of Cash Flow |
|
|
|
|
(in thousands of U.S. dollars) |
|
|
|
|
|
|
Three-month periods ended |
|
|
Six-month periods ended |
|
|
August 31, |
|
August 31, |
|
|
August 31, |
|
August 31, |
|
|
2023 |
|
2022 |
|
|
2023 |
|
2022 |
|
|
$ |
|
$ |
|
|
$ |
|
$ |
|
|
|
|
|
|
|
Cash flows from |
|
|
|
|
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
|
Net loss for the period |
(2,123 |
) |
(3,665 |
) |
|
(10,413 |
) |
(11,008 |
) |
Adjustments to reconcile net loss to cash used by operating
activities |
2,246 |
|
6,072 |
|
|
3,080 |
|
4,317 |
|
Changes in non-cash working capital items |
(21,283 |
) |
(13,931 |
) |
|
(3,133 |
) |
(7,898 |
) |
Cash used by operating activities |
(21,160 |
) |
(11,524 |
) |
|
(10,466 |
) |
(14,589 |
) |
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
Short-term investments |
1 |
|
107 |
|
|
20 |
|
(1,181 |
) |
Additions to property, plant and equipment |
(1,605 |
) |
(616 |
) |
|
(2,714 |
) |
(1,536 |
) |
Additions to intangible assets |
(390 |
) |
(1,200 |
) |
|
(774 |
) |
(1,209 |
) |
Proceeds on disposal of property, plant and equipment, and
intangible assets |
39 |
|
24 |
|
|
53 |
|
40 |
|
Net change in other assets |
5 |
|
14 |
|
|
33 |
|
28 |
|
Cash used by investing activities |
(1,950 |
) |
(1,671 |
) |
|
(3,382 |
) |
(3,858 |
) |
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
Dividends paid to Subordinate and Multiple Voting shareholders |
(491 |
) |
(497 |
) |
|
(491 |
) |
(497 |
) |
Net change in revolving credit facility |
5,000 |
|
16 |
|
|
5,000 |
|
16 |
|
Increase in long-term debt |
- |
|
- |
|
|
- |
|
2,160 |
|
Repayment of long-term debt |
(778 |
) |
(2,108 |
) |
|
(1,704 |
) |
(2,677 |
) |
Repayment of long-term lease liabilities |
(390 |
) |
(362 |
) |
|
(752 |
) |
(732 |
) |
Cash provided (used) by financing activities |
3,341 |
|
(2,951 |
) |
|
2,053 |
|
(1,730 |
) |
|
|
|
|
|
|
Effect of exchange rate differences on cash |
511 |
|
(1,781 |
) |
|
914 |
|
(3,563 |
) |
|
|
|
|
|
|
Net change in cash during the period |
(19,258 |
) |
(17,927 |
) |
|
(10,881 |
) |
(23,740 |
) |
|
|
|
|
|
|
Net cash – Beginning of the period |
58,630 |
|
47,652 |
|
|
50,253 |
|
53,465 |
|
|
|
|
|
|
|
Net cash – End of the period |
39,372 |
|
29,725 |
|
|
39,372 |
|
29,725 |
|
|
|
|
|
|
|
Net cash is composed of: |
|
|
|
|
|
Cash and cash equivalents |
41,474 |
|
32,938 |
|
|
41,474 |
|
32,938 |
|
Bank indebtedness |
(2,102 |
) |
(3,213 |
) |
|
(2,102 |
) |
(3,213 |
) |
|
|
|
|
|
|
Net cash – End of the period |
39,372 |
|
29,725 |
|
|
39,372 |
|
29,725 |
|
|
|
|
|
|
|
Supplementary information |
|
|
|
|
|
Interest received (paid) |
(53 |
) |
15 |
|
|
(102 |
) |
(208 |
) |
Income taxes paid |
(939 |
) |
(2,180 |
) |
|
(3,549 |
) |
(3,997 |
) |
For further information please contact:Bruno
Carbonaro, Chief Executive Officer and PresidentTel: (438)
817-7593orRishi Sharma, Chief Financial OfficerTel: (438)
817-4430
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