Wajax Corporation · TSX:WJX
Wajax — Q4 2020 Earnings Presentation
24 slides from Wajax's earnings presentation, Mar 2, 2021
Slide 1: Wajax Financial Results – Q4 2020
Wajax Financial Results – Q4 2020 March 2, 2021
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding \\ Forward-Looking Information This presentation contains certain forward-looking statements and forward-looking information, as defined in applicable securities laws (collectively, “forward-looking statements”). These forward-looking statements relate to future events
Slide 3: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP and Additional GAAP Measures This presentation contains certain non-GAAP and additional GAAP measures that do not have a standardized meaning prescribed by GAAP. Therefore, these financial measures may not be comparable to similar measures presented by other issuers. Investors are cautio
Slide 4: Update Regarding COVID-19 Pandemic Response
Update Regarding COVID-19 Pandemic \\ Response • The coronavirus pandemic and the measures implemented to stop the spread of COVID-19 and its variants have continued to have a significant effect on Wajax • The Corporation’s focus is to manage the business according to the following four key objectiv
Slide 5: Highlights – Fourth Quarter
\\ Highlights – Fourth Quarter -6% Revenue $381.0 • Revenue decline due to lower sales in western and 4% million eastern Canada • EBIT decline was primarily attributable to lower revenue, transaction costs of $1.0 million related to the -12% EBIT1 $18.8 acquisition of Tundra Process Solutions (“Tund
Slide 6: CEWS Program
\\ CEWS Program • During the fourth quarter, the Corporation qualified for the Canada Emergency Wage Subsidy (“CEWS”) and recognized $5.7 million as a reimbursement of compensation expense which was allocated as follows: • Cost of sales: $4.4 million • Selling and administrative expenses: $1.3 milli
Slide 7: Revenue by Region
\\ Revenue by Region Q4 20201 YTD 20201 • Revenue decreased $22.9 million, or 5.7%, to • For the twelve months ended December 31, 2020, $381.0 million in Q4 2020 versus $403.9 million for revenue decreased 8.4%, or $130.4 million, to the same period in 2019 $1,422.6 million versus $1,553.0 million i
Slide 8: Equipment and Product Support Revenue
\\ Equipment and Product Support Revenue Equipment $200 YoY Change 12.5% (25.4%) (6.2%) (3.2%) (7.3%) • Increase from Q3 2020 was due primarily to higher mining and forestry sales in western $150 Canada, higher construction sales in all regions and higher crane and utility sales in East Central cent
Slide 9: IP & ERS Revenue
\\ IP & ERS Revenue Industrial Parts $150 YoY Change • Increase from Q3 2020 was due primarily to (2.2%) (1.8%) (13.2%) (7.6%) (3.4%) higher process sales in all regions and higher $100 bearings sales in western and central East Central Canada • Decrease from Q4 2019 was due primarily to $50 lower s
Slide 10: Revenue by Category
\\ Revenue by Category YTD* Category5 Q4 2020 Q4 2019 Change YTD 2020 YTD 2019 Change E W C Construction $ 62.6 $ 54.8 $ 7.8 $ 220.2 $ 228.1 $ (7.9) ↑ ↓ ↓ Material Handling 37.2 49.0 (11.8) 151.1 163.9 (12.8) ↓ ↓ ↑ ERS 43.7 40.9 2.8 175.9 156.3 19.6 ↓ ↑ ↑ Industrial Parts 85.5 88.5 (3.0) 342.6 366.6
Slide 11: Backlog
\\ Backlog1 1• Backlog decreased by $23.4 million (-11%) from Q3 2020 to $181.7 million • Decrease due primarily to lower mining, forestry, power generation and construction orders, partially offset by higher material handling and industrial parts orders 2• Backlog decreased by $62.1 million (-26%)
Slide 12: Inventory
\\ Inventory 1• Inventory (including consignment) decreased by $51.2 million (-11%) from Q3 2020 to $412.0 million6 • Net of consignment, balance sheet inventory decreased by $32.5 million (-8%) as a result of lower equipment, parts and work-in-process inventory in most categories, partially offset
Slide 13: Cash Flow and Leverage
\\ Cash Flow and Leverage Cash Flow from Operating Activities $60 48.1 43.3 $40 34.8 16.3 $20 $0 (20.9) (7.4) ($20) (16.3)7 ($40) ($60) Q4 Q1 Q2 Q3 Q4 2019 2020 ($16.3)7 Leverage1 4.00x Total committed credit facilities* $450 $400 $350 3.00x $300 3.04x 2.82x $250 2.60x 2.59x 2.28x $200 2.00x 2.53x $
Slide 14: Balance Sheet
\\ Balance Sheet Adjusted Return On Net Assets (RONA)1 15.0% • RONA decrease from Q3 2020 due 12.1% primarily to lower trailing 12-month 11.2% 10.0% 10.6% 10.4% 10.1% adjusted EBIT • RONA decrease from Q4 2019 due 5.0% primarily to lower trailing 12-month adjusted EBIT and higher trailing 12- month
Slide 15: Acquisition of Tundra
\\ Acquisition of Tundra • Founded in 1999 in Calgary, Alberta, Tundra is a leading integrated maintenance and services provider and distributor to many of western Canada’s largest companies and industries • Tundra is a leader in comprehensive Process Solutions which addresses a gap in Wajax’s curre
Slide 16: Building a Canadian ERS Leader
\\ Building a Canadian ERS Leader Serving major customers in a $5 billion annual market… Mining and Resources Oil Sands / Oil and Gas Energy and Renewables Industrial and Manufacturing Engineering …with a robust On Site & Shop Services Asset Management Turnkey Solutions suite of extensive services…
Slide 17: 2021 Outlook
\\ 2021 Outlook • Recognizing that the challenges Wajax faced in 2020 have persisted into 2021, the Corporation nonetheless enters 2021 with confidence expecting that it is positioned to succeed over the longer term. In 2021, Wajax remains focused on the same priorities that guided it in 2020: prote
Slide 18: Appendix 1
Appendix 1 -\\ Together We Get More Done:
Slide 19: Endnotes
\\ Endnotes 1. This measure does not have a standardized meaning prescribed by GAAP. Please see Wajax’s Management’s Discussion and Analysis for the three and twelve months ended December 31, 2020 under the heading “Non-GAAP and Additional GAAP Measures”, which is available on SEDAR at www.sedar.com
Slide 20: Appendix 2
Appendix 2 -\\ Together We Get More Done:
Slide 21: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Except where noted, all figures are in millions of Canadian dollars, except per share data and ratio calculations. This presentation contains the following non-GAAP and additional GAAP measures that do not have a standardized meaning prescribed by GAAP and a
Slide 22: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Reconciliation of the Corporation’s net earnings to EBT, EBIT and Adjusted EBIT and the calculation of the Corporation’s RONA is as follows: For the twelve For the twelve For the twelve months ended months ended months ended December 31 September 30 December
Slide 23: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures (5) For the twelve months ended December 31, 2020 – Includes the $1.3 million pro-forma occupancy costs that would be incurred in the fourth quarter of 2020, the $1.0 million pro-forma occupancy costs that would be incurred in the third quarter of 2020, the
Slide 24: wajax.com
b viata \\ Together We Get More Done. Wajax.com