Goodfellow Inc. · TSX:GDL
Goodfellow — Shareholder Meeting (June 2021)
41 slides from Goodfellow's shareholder meeting presentation, Jun 22, 2021
Slide 1: Annual and Special Meeting of Shareholders
ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS JUNE 22, 2021 1
Slide 2: Directors and Officers
DIRECTORS AND OFFICERS • Douglas Goodfellow - Chair of the Board • Patrick Goodfellow – President/CEO • Charles Brisebois – CFO/Secretary • Alain Côté - Lead Director • David Goodfellow - Director • Normand Morin – Director/Chair of the Audit Committee • Stephen Jarislowsky – Director (virtual prese
Slide 3: Meeting
MEETING 3
Slide 4: Agenda
AGENDA ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS ▪ Meeting ▪ Approval of Minutes of Previous Meeting ▪ Reception of Financial Statements & Independent Auditor’s Report ▪ Ratification of Amendments to By-laws and Articles of the Corporation ▪ Election of Directors ▪ Appointment of Auditors ▪ Managem
Slide 5: Forward-Looking Financial Information
Annual and Special Meeting of Shareholders June 22, 2021 Forward-Looking Financial Information This presentation contains forward-looking statements on the objectives, strategies, financial position, operating results and activities of Goodfellow Inc. These statements are forward-looking to the exte
Slide 6: Adoption of IFRS 16, Leases
ADOPTION OF IFRS 16, LEASES (“IFRS 16”) ▪ On December 1, 2019, the Company adopted IFRS 16 using the modified retrospective approach ▪ Comparatives for the 2019 reporting periods have not been restated as permitted ▪ The application of this new standard resulted in: ▪ The addition of right-of-use as
Slide 7: Management Presentation
MANAGEMENT PRESENTATION 7
Slide 8: Management Presentation
MANAGEMENT PRESENTATION A review of : Patrick Goodfellow President and CEO • 2020 Objectives • 2020 Market Conditions • 2020 Financials • Q1 - 2021 Financials Charles Brisebois CFO and Secretary • 2021 Outlook GDL:TSX 8
Slide 9: Goodfellow 2020
GOODFELLOW 2020 700 20 > 7,000 Employees Locations Customers SALES BY CATEGORY SALES BY LOCATION GDL:TSX 9
Slide 10: Locations 2020
LOCATIONS 2020 • 18 Locations Across Canada, 1 Location USA, 1 in UK • Coast-to-Coast Distribution • Dry Kiln Capacity: 6M feet • Specialty Offering to Supply Industrial, Retail, Manufacturing, Flooring Dealers and Export Markets • Engineering Services DELSON: • Over 6M Sq Ft • Value-Added Wood Manu
Slide 11: Review 2020 Objectives
REVIEW 2020 OBJECTIVES ▪ Defy Expectations >1% NET RETURN ON SALES ▪ Restore Critical Volume >$500M ▪ Strengthen NATIONAL DISTRIBUTION Presence ▪ Diversify GDL SPECIALTY OFFERING ▪ Strengthen BALANCE SHEET for Opportunities ▪ Restore SHARE VALUE GDL:TSX 11
Slide 12: 2020 Commentary
2020 COMMENTARY Q1 ▪ Stagnant Pricing and Softening Demand Q2 ▪ COVID-19 Emerges ▪ Faced Major Supply Shortages Q3 ▪ Emergence of Cocooning Effect ▪ Surge in Demand Q4 ▪ Extremely Strong Seasonal Demand of Lumber Products ▪ Remained Strong Well into Late Fall GDL:TSX 12
Slide 13: COVID-19 Health and Safety
COVID-19 HEALTH AND SAFETY ▪ Remained FULLY OPERATIONAL as Essential Service 0 ONSITE ▪ Implemented Strict Health TRANSMISSIONS MEASURES AND PROTOCOLS ▪ Internal Promotion of the Public VACCINATION CAMPAIGN >75% VACCINATED ▪ Continually Reinforced Through EMPLOYEE COMMUNICATIONS 13
Slide 14: Projects and Realizations
PROJECTS AND REALIZATIONS 14
Slide 15: Biodôme
Biodôme Montreal, Quebec GDL:TSX 15
Slide 16: Mill Brook
Mill Brook Gros Morne National Park, Newfoundland GDL:TSX 16
Slide 17: Hundegger K2
Hundegger K2 GDL:TSX GOODFELLOW 5 co) 17
Slide 18: Rivière-à-Pierre
Rivière-à-Pierre Portneuf, Quebec GDL:TSX 18
Slide 19: Smartcentres Bus Terminal
Smartcentres Bus Terminal Vaughan, Ontario GDL:TSX 19
Slide 20: Duchesnay Creek Bridge
Duchesnay Creek Bridge Nipissing First Nation–North Bay boundary, Ontario GDL:TSX 20
Slide 21: Port Saint-François Pier
Port Saint-François Pier Nicolet, Quebec GDL:TSX 21
Slide 22: Wesleyan University
Wesleyan University Middletown, CT GDL:TSX 22
Slide 23: Rivière-de-la-Tortue
Rivière-de-la-Tortue Candiac, Quebec GDL:TSX 23
Slide 24: Timber Sizer / Incisor Completion
Timber Sizer / Incisor Completion GDL:TSX 24
Slide 25: 2020 Year-End Results
2020 YEAR-END RESULTS 25
Slide 26: 2020 - Sales
2020 - SALES $ Sales (in millions) 450 454 Q1 – Stagnant Demand +1% Q2 – Cost Control Measures and Inventory Reconciliation Q3 – Surge in Demand of Seasonal Products Q4 – Well Positioned to Supply Higher Margin Specialty Forest 2019 2020 Canada US Export Products GDL:TSX 26
Slide 27: 2020 – Net Profit and EPS
2020 – NET PROFIT AND EPS $ Net Income (in millions) EPS ▪ Net Return on 13.8 Sales 1.61 3.0% for 2020 (0.7% for 2019) ▪ Return on Shareholder Equity 3.1 11.4% for 2020 0.36 (2.7% for 2019) 2019 2020 2019 2020 GDL:TSX 27
Slide 28: 2020 – Gross Profit
2020 – GROSS PROFIT $ Gross Profit (in millions) Gross Profit 92 Margin 85 20.2% for 2020 (18.9% for 2019) ▪ Price Discipline Strategy ▪ Tightly Controlled Procurement ▪ Rising Tide of Commodity Pricing 2019 2020 GDL:TSX 28
Slide 29: 2020 – SG&A Expenses
2020 – SG&A EXPENSES $ SG&A (in millions) ▪ Staff Efficiency 78 70 ▪ Travel Expenses ↓ ▪ Promotional Expenses ↓ ▪ CEWS Effect $3M 2019 2020 GDL:TSX 29
Slide 30: 2020 – EBITDA
2020 – EBITDA(1) (2)(3) $ EBITDA (in millions) ▪ Gross Profit Margin +1.3% 29.5 ▪ SG&A Expenses ↓ ▪ Second Half of the Year: 10.9 ▪ Sales +10% ▪ Gross Profit +$10M ▪ Gross Profit Margin +2.2% 2019 2020 (1) This is a non-IFRS financial measure. Please refer to the Company’s MD&A. (2) Includes $4.3 mi
Slide 31: 2020 – Cash Flow
2020 – CASH FLOW $ Cash Flow from Operating Activities ▪ High (in millions) Inventory Turnover 13.4 11.4 ▪ Effective Seasonal Purge in Q4 ▪ Jump in Receivables due to Strong Q4 2019 2020 GDL:TSX 31
Slide 32: Q1 - 2021 Results
Q1 - 2021 RESULTS 32
Slide 33: Q1 2021 - Sales
Q1 2021 - SALES $ Sales (in millions) ▪ Commodity Pricing High 119 ▪ Hardwood Price +34% 89 Levels Rising and Restored Demand ▪ Flooring Distribution Network Strong ▪ Softwood Market Shortages Favour GDL Q1 - 2020 Q1 - 2021 GDL:TSX 33
Slide 34: Q1 2021 – Net Profit and EPS
Q1 2021 – NET PROFIT AND EPS $ Net Income EPS (in millions) ▪ Net Income 0.44 Profit 3.8 Spread +$5.9M ▪ Record Q1 Result Q1 - 2020 Q1 - 2021 Q1 - 2020 Q1 - 2021 -2.1 -0.24 GDL:TSX 34
Slide 35: Q1 2021 – Gross Profit
Q1 2021 – GROSS PROFIT $ Gross Profit Profit Margin (in millions) Gains to 21.3% (+1.7% from Q1-2020) 25 ▪ Aggressive Price 17 Discipline Strategy ▪ Rising Tide of Commodity Pricing ▪ Strong Value-Added Order File Q1 - 2020 Q1 - 2021 GDL:TSX 35
Slide 36: Q1 2021 – SG&A Expenses
Q1 2021 – SG&A EXPENSES $ SG&A (in millions) ▪ Staff Efficiency 20 20 ▪ Automation ▪ Increased Output Q1 - 2020 Q1 - 2021 GDL:TSX 36
Slide 37: Q1 2021 – EBITDA
Q1 2021 – EBITDA(1) $ EBITDA ▪ Increase of (in millions) $7.8M 7.6 ▪ Record Q1 contribution -0.2 Q1 - 2020 Q1 - 2021 (1) This is a non-IFRS financial measure. GDL:TSX 37 Please refer to the Company’s MD&A.
Slide 38: Q1 2021 – Cash Flow
Q1 2021 – CASH FLOW $ Cash Flow from Operating Activities (in millions) ▪ Cash in from Q1 - 2020 Q1 -2021 Q4 2020 Receivables -2.3 -14.4 GDL:TSX 38
Slide 39: Recap 2020 Outcomes
RECAP 2020 OUTCOMES ▪ Drove MARGIN IMPROVEMENTS Through Price Discipline and Monitoring ▪ INCREASED MARKET SHARE Across all Categories ▪ SUPPLY DISRUPTIONS WELL MANAGED, Masters of Alternative Procurement ▪ Labour Shortage Countered Through AUTOMATION ▪ Very TIGHT CONTROL ON EXPENSES GDL:TSX 39
Slide 40: What's Next: Preparing for What's Next
• RETENTION of Newly Gained Customers PREPARING • Incorporate NEW DISTRIBUTION LINE Opportunities FOR • Improve CUSTOMER SERVICE Experience (Online WHAT’S Tools) NEXT • Capitalize on our Strengths: • DIVERSIFIED Offering • VALUE-ADDED Manufacturing Investments A Return to • ASSET Opportunities Histo
Slide 41: Question Period
QUESTION PERIOD 41