Slide 1: Wajax Financial Results Q2 2019
Wajax Financial Results Q2 2019 August 9, 2019
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 – Strong Second Quarter
\\ Highlights – Strong Second Quarter • Up 7% on gains in western and eastern Canada, led Revenue1 $409.4 by overall gains in the ERS, forestry and material 7% million handling categories • SG&A as a percentage of revenue increased 40bps to 13.9% from 13.5% in the prior year period primarily EBIT1,2
Slide 4: Revenue by Region
\\ Revenue by Region Q2 20191,2 YTD 20191,2 • Revenue increased $27.1 million, or 7.1%, to $409.4 • For the six months ended June 30, 2019, revenue million in Q2 2019 versus $382.3 million for the increased 8.2%, or $59.2 million, to $784.0 million same period in 2018 versus $724.7 million for the s
Slide 5: Revenue Analysis
\\ Revenue Analysis Q2 2019 YTD 2019 • $1.4 million (1.0%) increase • $10.4 million (-3.9%) decrease Equipment Sales C compared to Q2 20181 C compared to 20181 22% 20% • Higher forestry sales in all • Lower construction sales in E E regions and higher material western and central Canada and $145.6 4
Slide 6: Revenue by Category
\\ Revenue by Category YTD* Category1 Q2 2019 Q2 2018 Change YTD 2019 YTD 2018 Change E W C Construction $ 64.9 $ 70.2 $ (5.3) $ 120.3 $ 134.8 $ (14.5) ↑ ↓ ↓ Material Handling 42.4 37.0 5.3 84.1 72.7 11.5 ↑ ↑ - ERS 37.9 16.2 21.7 75.0 33.0 42.1 ↑ ↑ ↑ Industrial Parts 93.9 93.6 0.3 187.4 182.5 4.8 ↑
Slide 7: Adjusted Basic EPS
\\ Adjusted Basic EPS1 Q2 2019 YTD 2019 • Q2 adjusted net earnings of $12.6 million, or $0.63 • YTD 2019 adjusted net earnings of $21.3 million, or per share, representing a $0.4 million increase over $1.07 per share, representing a $0.5 million the prior year period1,2 decrease over the prior year
Slide 8: Backlog
\\ Backlog1 1• Backlog increased by $41.2 million (16%) from Q1 2019 to $296.5 million and represents the highest reported backlog since our peak earnings year of 2012 • Equipment backlog increased $43.0 million driven primarily by higher mining and forestry orders 2• Backlog increased by $39.6 mill
Slide 9: Inventory
\\ Inventory 1• Inventory (including consignment) increased by $30.5 million from Q1 2019 to $578.6 million1 • Consignment inventory increased $6.5 million and consists primarily of construction excavators • 97% of the overall inventory growth was related to Targeted Growth categories and consists p
Slide 10: Robust Balance Sheet
\\ Robust Balance Sheet Credit Capacity Adjusted Return On Net Assets (RONA)1,2 15.0% 4.0x 14.0% Available Capacity 12.5% 12.1% 3.0x 11.8% 2.71x Q2 2019 10.0% Q2/18 Q1/19 Q2/19 Debt / EBITDA 2.0x Working Capital Efficiency1 Target Range 25% 2.9x 3.0x 2.6x 2.5x 2.5x 1.0x 23.3% 23% 22.8% 2.0x 21.5% 20
Slide 11: 2019 Outlook
\\ 2019 Outlook • Our plans are based on an expectation of generally stable market conditions in eastern and central Canada • In western Canada, activity remains stable to positive in important end markets such as the oil sands and mining, but is expected to slow temporarily in areas such as convent
Slide 12: Appendix
Appendix \\ Together We Get More Done?
Slide 13: 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 14: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures EBITDA Net earnings 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-tax res
Slide 15: 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 16: 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 Six months ended June 30 June 30 2018 2018 2019 2019 (As adjusted)(3) (As adjusted)(3) Net earnings
Slide 17: 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 June 30 2019 Net earnings $ 35.0 Income tax expense 13.7 EBT 48.7 Finance costs 14.2 EBIT 62.9 Depreciation and amortization
Slide 18: 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: June 30 2019 Cash $ (4.6) Long-term debt 270.3 Funded net debt(1) $ 265.7 Letters of credit 5.4 Debt $ 271.2 Leverage ratio(2) 2.71 (1) Effective with the reporting peri
Slide 19: 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 June 30 March 31 June 30 2019 201
Slide 20: Non-GAAP and Additional GAAP Measures
\\ Non-GAAP1 and Additional GAAP Measures (7) For the twelve months ended June 30, 2019 – Includes the $0.7 million pro-forma occupancy costs that would be incurred in the second quarter of 2019 and the $0.7 million pro-forma occupancy costs that would be incurred in the first quarter of 2019 assumi
Slide 21: wajax.com
b viata \\ Together We Get More Done. Wajax.com