Logistec Announces Financial Results for the Fourth Quarter and Fiscal 2009
March 17, 2010 12:18 PM
MONTREAL, QUEBEC--(Marketwire - March 17, 2010) - Logistec Corporation (TSX:LGT.A)(TSX:LGT.B), a diversified cargo handler in eastern North American ports, announced today its financial results for the fourth quarter and the fiscal year ended December 31, 2009.
Consolidated revenue from continuing operations totalled $215.0 million in 2009, compared with $228.3 million in 2008, down by $13.3 million or 5.8%. This decrease came from the marine services segment. Low economic activity negatively affected the steel and forest products industries and many mining projects in which we were involved in 2008. This had a negative impact on bulk and break-bulk cargo volumes, as well as on our Arctic marine transportation services. This was partly offset by the increase in revenue from our environmental services segment, which mostly came from an improvement of the Aqua-Pipe(R) business. Net income from continuing operations reached $8.1 million or $1.22 per share in 2009, down by $5.8 million from $13.9 million or $2.09 per share in 2008. Revenue from marine services fell 14.3% to $160.8 million in 2009 ($187.8 million in 2008), whereas net income from continuing operations in the marine services segment decreased by 55.0% to $5.6 million ($12.5 million in 2008). Revenue from environmental services rose 33.5% to $54.2 million in 2009 ($40.6 million in 2008), where net income from continuing operations in the environmental services segment grew by 71.7% to $2.5 million ($1.5 million in 2008).
"Given the difficult economic conditions, we are satisfied with the final results for 2009. Cargo-handling revenue dropped some 15.8% and affected virtually all of our cargo-handling markets. Our marine transportation business was also affected by lower revenue, primarily on the international market, in addition to being negatively impacted by an engine failure in the High Arctic. Fortunately, these lower results were somewhat offset by excellent results in our environmental business," indicated Madeleine Paquin, President and Chief Executive Officer of Logistec Corporation.
Fourth-Quarter Results
Revenue from continuing operations reached $66.7 million in the fourth quarter of 2009, up by $2.9 million over the fourth quarter of 2008. Revenue from the environmental services segment was particularly strong in this quarter and revenue from acquired businesses accounted for $4.8 million.
Net income from continuing operations totalled $4.5 million or $0.68 per share for the fourth quarter of 2009, representing a 14.9% decrease from $5.3 million or $0.80 per share in 2008.
Acquisitions
We were pleased to conclude three investment projects in our cargo-handling business in 2009. Firstly, in May, we purchased a 55-acre parcel of land in Montreal-Est (QC). This parcel will be developed as a logistics centre and will support the growth of our terminal activities in the Port of Montreal (QC). Secondly, in October, the Company purchased Les Terminaux Rideau Bulk Terminals Inc., a company that handles primarily road salt and aggregates in four ports along the St. Lawrence Seaway as well as in two inland terminals in Ontario. Thirdly, we were successful in purchasing our partner's 50% interest in BalTerm, L.L.P., a limited liability partnership that specializes in the handling of inbound forest products through several facilities in the Port of Baltimore (MD).
Sanexen successfully completed two acquisitions in 2009, PCB Disposal Inc., which strengthens its market reach in the disposal business, and Niedner, a leading woven-hose manufacturer and exclusive supplier to Sanexen of one crucial component of Aqua-Pipe(R), the structural lining developed by Sanexen used to rehabilitate water mains.
"These investments all have strategic long-term value for Logistec and, other than the land which will be developed over the longer term, are expected to be accretive to earnings starting in 2010," commented Ms. Paquin.
Outlook
"We remain prudent about the near future. Although economic indicators and experts are saying that the recession is over, we have not detected clear and strong signs of recovery. Trade volumes are not expected to return to their 2008 highs within the next two years. Furthermore, some of our market segments will undergo more profound changes and it will be important for us to adjust and position ourselves accordingly. We must therefore be vigilant with our resources and remain focused on the pursuit of development opportunities. Consequently, we continue to closely monitor and control our costs and are working diligently at generating new business," said Ms. Paquin.
"For the longer term, Logistec has a promising future, in both our marine services and environmental services segments. Each segment has its challenges, but we are confident that with our continued focus on the development of our personnel, we will address the challenges and develop opportunities, so that both segments keep growing according to their respective plans," concluded Ms. Paquin.
About Logistec
Logistec Corporation is based in Montreal (QC) and provides specialized services to the marine community and industrial companies in the areas of container, break-bulk and bulk cargo handling in 23 ports in Eastern Canada, the Great Lakes and the U.S. East Coast, including a short-line railway linked to a coal-handling operation in Cape Breton (NS). Logistec also offers marine transportation services geared primarily to the Arctic coastal trade; as well as agency services to foreign shipowners and operators serving the Canadian market. Furthermore, the Company operates in the environmental sector where it provides services for the trenchless structural rehabilitation of water mains, PCB management, site remediation, risk assessment, and woven-hose manufacturing. The Company has been profitable and has paid regular dividends since becoming public and payments have grown steadily over the years.
A public company since 1969, Logistec's shares are listed on the Toronto Stock Exchange under the ticker symbols LGT.A and LGT.B. More information can be obtained at the Company's website at www.logistec.com.
Forward-Looking Statements
For the purpose of informing shareholders and potential investors about the Company's prospects, sections of this document may contain forward-looking statements, within the meaning of securities legislation, about the Company's activities, performance and financial situation and, in particular, hopes for the success of the Company's efforts in the development and growth of its business. These forward-looking statements express, as of the date of this document, the estimates, predictions, projections, expectations or opinions of the Company about future events or results. Although the Company believes that the expectations produced by these forward-looking statements are founded on valid and reasonable bases and assumptions, these forward-looking statements are inherently subject to important uncertainties and contingencies, many of which are beyond the Company's control, such that the Company's performance may differ significantly from the predicted performance expressed or presented in such forward-looking statements. The important risks and uncertainties that may cause the actual results and future events to differ significantly from the expectations currently expressed are examined under "Business Risks" in the Company's Annual Report and include (but are not limited to) the performances of domestic and international economies and their effect on shipping volumes, weather conditions, labour relations, pricing and competitors' marketing activities. The reader of this document is thus cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to update or revise these forward-looking statements, except as required by law.
Additional information relating to the Company, including the Company's Annual Information Form, is on SEDAR at www.sedar.com.
Consolidated Statements of Earnings
years ended December 31
(in thousands of dollars, except for number of shares and per share
amounts)
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2009 2008
$ $
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Revenue 215,001 228,344
Operating expenses 190,245 199,423
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24,756 28,921
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Amortization of property, plant and equipment 8,659 8,342
Amortization of intangible and other assets 938 251
Interest on long-term debt 1,451 1,155
Other interest expense 229 362
Interest revenue from investments in service
contracts (1,923) (972)
Foreign exchange loss (gain) 989 (1,848)
Loss (gain) on disposal of property, plant and
equipment 82 (335)
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10,425 6,955
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Income from continuing operations 14,331 21,966
Share in the results of companies subject to
significant influence (31) 11
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Income before income taxes, non-controlling
interests and discontinued operations 14,300 21,977
Income taxes 4,420 5,907
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Income before non-controlling interests and
discontinued operations 9,880 16,070
Non-controlling interests 1,747 2,132
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Net income from continuing operations 8,133 13,938
Net loss from discontinued operations - (547)
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Net income 8,133 13,391
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Basic and diluted earnings (loss) per share
Continuing operations 1.22 2.09
Discontinued operations - (0.08)
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1.22 2.01
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Weighted average number of shares outstanding,
basic and diluted 6,655,461 6,671,836
Consolidated Statements of Retained Earnings
years ended December 31
(in thousands of dollars)
--------------------------------------------------------------------------
2009 2008
$ $
--------------------------------------------------------------------------
Balance, beginning of year 83,435 72,507
Net income 8,133 13,391
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91,568 85,898
Excess over par value of Class A Common Shares
repurchased 10 82
Excess over par value of Class B Subordinate
Voting Shares repurchased 42 215
Dividends 2,152 2,166
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Balance, end of year 89,364 83,435
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Consolidated Statements of Comprehensive Income
years ended December 31
(in thousands of dollars)
----------------------------------------------------------------------------
2009 2008
$ $
----------------------------------------------------------------------------
Net income 8,133 13,391
Other comprehensive income
Unrealized gain (loss) on translation of
financial statements of self-sustaining foreign
subsidiaries (778) 1,229
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Comprehensive income 7,355 14,620
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Consolidated Balance Sheets
as at December 31
(in thousands of dollars)
----------------------------------------------------------------------------
2009 2008
$ $
----------------------------------------------------------------------------
Assets
Current assets
Cash and cash equivalents 17,297 21,304
Short-term investments 3,862 -
Accounts receivable 50,586 39,671
Income taxes receivable 4,091 2,375
Future income taxes 264 407
Prepaid expenses 2,706 3,040
Inventories 4,273 1,525
Assets related to discontinued operations - 61
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83,079 68,383
Investments 20,006 26,452
Property, plant and equipment 78,938 57,167
Goodwill 10,349 5,484
Intangible assets 3,826 -
Other assets 11,837 11,803
Future income taxes 6,697 7,720
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214,732 177,009
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Liabilities
Current liabilities
Short-term bank loans 3,048 51
Short-term note payable - 3,106
Accounts payable and accrued liabilities 28,830 21,885
Deferred revenue 1,412 1,528
Income taxes payable 657 1,285
Dividends payable 538 538
Future income taxes 1,112 835
Current portion of long-term debt 9,432 2,115
Current portion of asset retirement obligations 93 -
Current liabilities related to discontinued
operations - 757
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45,122 32,100
Long-term debt 41,333 23,964
Asset retirement obligations 443 554
Future income taxes 12,303 11,891
Other liabilities 5,592 4,896
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104,793 73,405
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Non-controlling interests 7,737 6,657
----------------------------------------------------------------------------
Commitments, contingencies and guarantees
Shareholders' equity
Capital stock 15,395 15,291
Retained earnings 89,364 83,435
Accumulated other comprehensive loss (2,557) (1,779)
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86,807 81,656
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102,202 96,947
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214,732 177,009
----------------------------------------------------------------------------
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Consolidated Statements of Cash Flows
years ended December 31
(in thousands of dollars)
----------------------------------------------------------------------------
2009 2008
$ $
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Operating activities
Net income from continuing operations 8,133 13,938
Items not affecting cash and cash equivalents 14,793 13,378
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Cash provided from operations 22,926 27,316
Dividends received from companies subject to
significant influence 30 -
Contributions to defined benefit pension plans (1,180) (1,205)
Changes in non-cash working capital items (7,924) (1,190)
----------------------------------------------------------------------------
13,852 24,921
----------------------------------------------------------------------------
Financing activities
Net change in short-term bank loans 2,997 (4,002)
Issuance of long-term debt 33,922 9,826
Repayment of long-term debt (10,615) (1,753)
Issuance of Class B Subordinate Voting Shares 3 5
Repurchase of Class B Subordinate Voting Shares (67) (288)
Repurchase of Class A Common Shares (11) (90)
Dividends paid to non-controlling interests (863) (348)
Dividends paid (2,152) (2,167)
----------------------------------------------------------------------------
23,214 1,183
----------------------------------------------------------------------------
Investing activities
Customer repayment of investments in service
contracts 3,735 2,351
Investments in service contracts (6) -
Cash acquired in business acquisitions 1,703 1,027
Business acquisitions (25,545) (10,977)
Acquisition of temporary investments - (125)
Acquisition of short-term investments (1,574) -
Disposal of temporary investments - 125
Acquisition of property, plant and equipment (19,192) (11,883)
Proceeds from disposal of property, plant and
equipment 380 725
Acquisition of other assets (3) (439)
Decrease in other assets 95 -
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(40,407) (19,196)
----------------------------------------------------------------------------
Foreign exchange gain (loss) on cash held in
foreign currencies of self-sustaining
subsidiaries 30 (14)
----------------------------------------------------------------------------
Net change in cash and cash equivalents from
continuing operations (3,311) 6,894
Net change in cash and cash equivalents from
discontinued operations (696) 727
Cash and cash equivalents, beginning of year (1) 21,304 13,683
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Cash and cash equivalents, end of year (2) 17,297 21,304
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(1) Comprises of cash on hand
(2) Comprises of cash on hand and short-term investments with maturity
date less than three months from the acquisition date
