Slide 1: Wajax Financial Results – Q1 2020
Wajax London Ontario Branch Wajax Financial Results – Q1 2020 May 5, 2020
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: Highlights – First Quarter
\\ Highlights – First Quarter • Consolidated revenue reduction driven primarily by a weak March due to COVID-19 impact (January and -8% Revenue $344.1 February were comparable year-over-year) million • Western Canada volume further affected by low oil prices 4% • EBIT decreased $4.0 million, compare
Slide 4: Revenue by Region
\\ Revenue by Region Q1 20201 • Revenue decreased $30.5 million, or 8.1%, to $344.1 million in Q1 2020 versus $374.6 million for the same period in 2019 • Decrease was due to lower sales in all regions, partly offset by higher ERS sales in central and eastern Canada due partially to the acquisition
Slide 5: Revenue Analysis
\\ Revenue Analysis Q1 2020 • $28.5 million (-25.4%) Equipment Sales C decrease compared to Q1 25% E 2019 33% • Lower construction sales $83.6 across all regions, lower million forestry sales in western and eastern Canada, lower power W generation sales in central and 42% eastern Canada, and lower m
Slide 6: Revenue by Category
\\ Revenue by Category YTD* Category1 Q1 2020 Q1 2019 Change YTD 2020 YTD 2019 Change E W C Construction $ 41.9 $ 55.4 $ (13.5) ↓ ↓ ↓ Material Handling 39.4 41.7 (2.3) ↓ ↑ ↑ ERS 45.0 37.1 7.9 ↑ ↑ ↑ Industrial Parts 91.7 93.4 (1.7) ↑ ↓ ↓ Forestry 24.8 33.2 (8.4) ↓ ↓ ↑ On-Highway 22.5 25.1 (2.7) ↓ ↓ ↓
Slide 7: Adjusted Basic EPS
\\ Adjusted Basic EPS1 Q1 2020 • Q1 adjusted net earnings of $5.8 million, or $0.29 per share, representing a $2.9 million decrease over the prior year period1 • Decrease is primarily attributable to lower revenue and higher finance costs (33%) $0.43 $0.29 2019 2020 1 This measure does not have a st
Slide 8: Backlog
\\ Backlog1 1• Backlog increased by $13.7 million (6%) from Q4 2019 to $231.8 million • Equipment backlog increased $10.8 million driven primarily by higher construction orders 2• Backlog decreased by $23.5 million (-9%) compared to Q1 2019 • Equipment backlog decreased $12.6 million driven by lower
Slide 9: Inventory
\\ Inventory 1• Inventory (including consignment) increased by $12.5 million from Q4 2019 to $550.7 million 1 • Net of consignment, balance sheet inventory increased by $27.8 million as a result of higher equipment inventory in the forestry, construction and mining categories, including the receipt
Slide 10: Balance Sheet
\\ Balance Sheet Credit Capacity Adjusted Return On Net Assets (RONA)1 15.0% 4.0x Available Capacity: $137.4M 12.5% 3.0x 12.1% 12.1% 3.04x Leverage ratio1 11.2% 2.53x 10.0% Senior secured Q1/19 Q4/19 Q1/20 Debt / EBITDA leverage ratio1 2.0x Target Range Working Capital Efficiency1 30% 3.5x 3.0x 1.0x
Slide 11: COVID-19 and Market Conditions
\\ COVID-19 and Market Conditions • The coronavirus pandemic and the measures implemented to stop the spread of COVID-19 have had a significant effect on Wajax. • The table below summarizes the Corporation’s four main objectives in managing through this difficult period, as well as key actions taken
Slide 12: 2020 Outlook
\\ 2020 Outlook • Current business conditions had a negative effect on the Corporation’s results during the first quarter of 2020, due primarily to volume declines in March. While the ongoing COVID-19 pandemic remains the primary challenge, the significant decline in oil prices has also negatively a
Slide 13: Appendix
Appendix -\\ Together We Get More Done:
Slide 14: 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 certain non-GAAP and additional GAAP measures that do not have a standardized meaning prescribed by GAAP. Therefore,
Slide 15: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures EBITDA Net earnings (loss) before finance costs, income tax expense, depreciation and amortization. EBITDA is a non-GAAP measure commonly used as an indicator of a company’s cash operating performance. Adjusted net earnings Net earnings (loss) before after-t
Slide 16: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Net assets Net assets are defined as total current and non-current assets excluding cash, income taxes receivable, derivative instruments, deferred tax asset and lease assets, less total current and non-current liabilities excluding bank indebtedness, income
Slide 17: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Reconciliation of the Corporation’s net earnings to adjusted net earnings and adjusted basic and diluted earnings per share is as follows: Three months ended March 31 2020 2019 Net earnings $ 4.1 $ 7.9 Restructuring and other related costs, after-tax 0.1 0.7
Slide 18: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Reconciliation of the Corporation’s net earnings to EBT, EBIT, EBITDA and Adjusted EBITDA is as follows: For the twelve months ended March 31 2020 Net earnings $ 35.7 Income tax expense 12.8 EBT 48.5 Finance costs 21.0 EBIT 69.5 Depreciation and amortization
Slide 19: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures Calculation of the Corporation’s funded net debt, debt and leverage ratio is as follows: March 31 2020 Bank indebtedness $ 6.0 Debentures 54.2 Long-term debt 254.5 Funded net debt $ 314.7 Letters of credit 6.5 Debt $ 321.2 Leverage ratio(1) 3.04 Senior secur
Slide 20: 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 March 31 December 31 March 31 202
Slide 21: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures (5) In 2020 and in 2019, the Corporation incurred professional fees relating to the CSC project. (6) For the twelve months ended March 31, 2019 – Includes the $1.3 million pro-forma occupancy costs that would be incurred in the first quarter of 2020, the $0.
Slide 22: wajax.com
b viata \\ Together We Get More Done. Wajax.com