MONTREAL, QUEBEC and SARASOTA, FLORIDA -- (Marketwired) -- 03/08/18 -- Intertape Polymer Group Inc. (TSX: ITP) (the "Company") today released results for its fourth quarter and year ended December 31, 2017. All amounts in this press release are denominated in US dollars unless otherwise indicated and all percentages are calculated on unrounded numbers. For more information, you may refer to the Company's management's discussion and analysis and audited consolidated financial statements and notes thereto as of December 31, 2017 and 2016 and for the three-year period ended December 31, 2017 ("Financial Statements").
Fourth Quarter 2017 Highlights (as compared to fourth quarter 2016):
-- Revenue increased 13.1% to $237.4 million primarily due to additional
revenue from the Cantech Acquisition (1), an increase in average selling
price, including the impact of product mix, and an increase in sales
volume.
-- Gross margin decreased to 22.8% from 25.6% primarily due to the non-
recurrence of Insurance Proceeds (2). Gross margin in the fourth quarter
of 2016 would have been 21.7% excluding the impact of the Insurance
Proceeds.
-- Selling, general and administrative expenses ("SG&A") increased 33.4% to
$34.1 million primarily due to (i) an increase in share-based
compensation of $4.7 million primarily driven by an increase in fair
value of cash-settled awards, (ii) additional SG&A resulting from the
Cantech Acquisition, and (iii) a $1.6 million increase in M&A Costs (3).
-- Income tax expense decreased $12.2 million to an income tax benefit of
$2.5 million for 2017 primarily due to a $9.6 million net tax benefit
mainly resulting from the remeasurement of the US net deferred tax
liability using the lower US corporate tax rate provided under the Tax
Cuts and Jobs Act ("TCJA") enacted into law on December 22, 2017.
-- Net earnings attributable to the Company shareholders ("IPG Net
Earnings") decreased $0.4 million to $21.3 million. The decrease was
primarily due to an increase in SG&A and an increase in manufacturing
facility closures, restructuring and other related charges primarily
driven by the non-recurrence of the benefit from Insurance Proceeds in
the fourth quarter of 2016 partially offset by a decrease in income tax
expense and an increase in foreign exchange gains.
-- Adjusted EBITDA (3)(4) increased 0.2% to $35.7 million primarily due to
organic growth in gross profit and adjusted EBITDA contributed by
Cantech, partially offset by the non-recurrence of $8.1 million in
Insurance Proceeds. Excluding Insurance Proceeds, adjusted EBITDA for
the fourth quarter of 2016 would have been $27.5 million.
-- Cash flows from operating activities decreased $5.7 million to $59.3
million primarily due to a decrease in operating profit and cash flows
from working capital items.
-- Free cash flows(4) decreased by $5.5 million to $45.3 million primarily
due to a decrease in cash flows from operating activities.
Fiscal Year 2017 Highlights (as compared to fiscal year 2016):
-- Revenue increased 11% to $898.1 million primarily due to additional
revenue from the Cantech Acquisition and Powerband Acquisition (1)
("Acquisitions") and an increase in average selling price, including the
impact of product mix.
-- Gross margin decreased to 22.4% from 23.7% primarily due to a reduction
in the Insurance Proceeds. Gross margin would have been 22.2% and 22.1%
excluding the impact of the Insurance Proceeds in 2017 and 2016,
respectively.
-- SG&A increased 4.9% to $107.6 million primarily due to additional SG&A
resulting from the Acquisitions and a $3.4 million increase in M&A
Costs, partially offset by a decrease in share-based compensation of
$4.9 million primarily driven by a decrease in the fair value of cash-
settled awards.
-- Income tax expense decreased $6.5 million to $13.0 million in 2017
primarily due to a $9.6 million net tax benefit mainly resulting from
the remeasurement of the US net deferred tax liability using the lower
US corporate tax rate provided under the TCJA.
-- IPG Net Earnings increased $13.1 million to $64.2 million primarily due
to an increase in gross profit and a decrease in income tax expense,
partially offset by an increase in SG&A.
-- Adjusted EBITDA increased 6.2% to $129.6 million primarily due to
organic growth in gross profit and adjusted EBITDA contributed by
Cantech, partially offset by a $10.5 million reduction in Insurance
Proceeds and an increase in SG&A mainly due to employee related costs to
support growth initiatives in the business. Excluding the impact of
Insurance Proceeds, adjusted EBITDA for 2017 and 2016 would have been
$127.5 million and $109.4 million, respectively.
-- Cash flows from operating activities decreased in the year ended
December 31, 2017 by $16.0 million to $92.1 million, primarily due to
cash flows from working capital items.
-- Free cash flows (4) decreased by $51.3 million to $6.8 million due to an
increase in capital expenditures and a decrease in cash flows from
operating activities.
(1) "Powerband Acquisition" refers to the acquisition by the Company of 74%
of Powerband Industries Private Limited (doing business as "Powerband")
on September 16, 2016. "Cantech Acquisition" refers to the acquisition
by the Company of substantially all of the assets of Canadian Technical
Tape Ltd. (doing business as "Cantech"), which includes the shares of
Cantech Industries Inc., Cantech's US subsidiary, on July 1, 2017.
(2) "South Carolina Flood" refers to significant rainfall and subsequent
severe flooding on October 4, 2015 that resulted in considerable damage
to and the permanent closure of the Columbia, South Carolina
manufacturing facility eight to nine months in advance of the planned
shut down. "Insurance Proceeds" refers to insurance claim settlement
proceeds totalling $29.5 million, net of a $0.5 million deductible,
covering most of the claimed losses associated with the South Carolina
Flood. The Company recorded proceeds as a benefit in manufacturing
facility closures, restructuring and other related charges totalling
$5.0 million, $0.5 million and $9.3 million in the fourth quarter of
2015, and second and fourth quarters of 2016, respectively, and as a
benefit in cost of sales totalling $4.5 million, $8.1 million, and $2.1
million in the second and fourth quarters of 2016 and the first quarter
of 2017, respectively.
(3) The Company has modified its definition of adjusted EBITDA to also
exclude advisory fees and other costs associated with mergers and
acquisitions activity, including due diligence, integration and certain
non-cash purchase price accounting adjustments ("M&A Costs"). Prior
period amounts have been conformed to the new definition of adjusted
EBITDA.
(4) Non-GAAP financial measure. For definitions and reconciliations of non-
GAAP financial measures to their most directly comparable GAAP financial
measures, see "Non-GAAP Financial Measures" below.
Other Highlights:
-- On March 7, 2018, the Board of Directors declared a dividend of $0.14
per common share payable on March 30, 2018 to shareholders of record at
the close of business on March 20, 2018 . These dividends will be
designated by the Company as "eligible dividends" as defined in
Subsection 89(1) of the Income Tax Act (Canada).
-- In the fourth quarter of 2017, the Company achieved a run rate of $4.0
million in annual synergies associated with the closure of the TaraTape
Fairless Hills, Pennsylvania manufacturing facility and integration,
which was in line with the Company's previous guidance of between $4 and
$6 million of additional adjusted EBITDA.
"We finished 2017 on a high note with a solid adjusted EBITDA performance of $35.7 million for the fourth quarter and $129.6 million for the year, supported by the benefits of manufacturing cost reductions, the contribution from acquisitions including operational synergies and a favourable product mix" indicated Greg Yull, President and CEO.
"Our capital expenditures reached a record level of $85 million in 2017 which reflects, in large part, the significant opportunities identified to increase manufacturing capacity in certain product categories such as water-activated tapes and stretch film as well as to improve operational and manufacturing efficiencies. Furthermore, we completed three large capital projects in 2017 on time and on budget, representing approximately $70 million in total capital invested to date.
"As we look to 2018, we remain committed to capital projects we believe will yield an after-tax internal rate of return of greater than 15% and anticipate that expenditures will remain near record levels, between $80 to $90 million. 2018 will continue to be somewhat of a transition year given more significant projects coming on line, but we should start reaping the rewards of the investments made in 2017. This year, we expect to complete the Utah Shrink Film and Specialty Tape projects and to make significant progress on the Capstone and Powerband greenfield manufacturing facilities. We continue to work hard on achieving significant synergies from our acquisitions, including Cantech, and we expect to deliver solid organic growth for the current fiscal year derived from the significant investments we are making in our operations. These investments should reinforce our competitive position and increase shareholder value for years to come," concluded Mr. Yull.
Outlook
The Company's expectations for the fiscal year and first quarter of 2018 are as follows:
-- Revenue growth in 2018 is expected to be similar to that experienced in
2017, excluding the impact of any merger and acquisitions activity that
takes place in 2018, and any significant fluctuations in selling prices
caused by unforeseen variations in raw material prices.
-- Adjusted EBITDA for 2018 is expected to be between $135 and $145
million. As in previous years, the Company expects adjusted EBITDA to be
proportionately higher in the second, third and fourth quarters of the
year relative to the first quarter due to the effects of normal
seasonality.
-- Total capital expenditures for 2018 are expected to be between $80 and
$90 million.
-- Excluding the potential impact of changes in the mix of earnings between
jurisdictions, the Company expects an 18% to 23% effective tax rate for
2018 and cash taxes paid in 2018 to be less than one third of the income
tax expense in 2018, as a result of the TCJA enacted into law in the
United States on December 22, 2017. The TCJA, among other things,
lowered the US statutory corporate tax rate from 35% to 21% and enhanced
and extended through 2026 the option to claim accelerated depreciation
deductions on qualified property.
-- Revenue in the first quarter of 2018 is expected to be greater than in
the first quarter of 2017.
-- Adjusted EBITDA in the first quarter of 2018 is expected to be greater
than in the first quarter of 2017, excluding the benefit of the
Insurance Proceeds recorded in the first quarter of 2017.
Conference Call
A conference call to discuss the Company's 2017 fourth quarter and annual results will be held Thursday, March 8, 2018, at 10 A.M. Eastern Time. Participants may dial 877-291-4570 (USA & Canada) and 647-788-4919 (International).
AN ACCOMPANYING PRESENTATION WILL ALSO BE AVAILABLE. PLEASE CLICK THE LINK OR TYPE INTO YOUR BROWSER TO ACCESS:
https://www.itape.com/investor%20relations/events%20and%20presentations/investor%20presentations
You may access a replay of the call by dialing 800-585-8367 (USA & Canada) or 416-621-4642 (International) and entering Access Code 9885109. The recording will be available from March 8, 2018 at 1:00 P.M. until April 8, 2018 at 11:59 P.M. Eastern Time.
About Intertape Polymer Group Inc.
Intertape Polymer Group Inc. is a recognized leader in the development, manufacture and sale of a variety of paper and film based pressure-sensitive and water-activated tapes, polyethylene and specialized polyolefin films, woven coated fabrics and complementary packaging systems for industrial and retail use. Headquartered in Montreal, Quebec and Sarasota, Florida, the Company employs approximately 2,500 employees with operations in 19 locations, including 13 manufacturing facilities in North America and one each in Europe and Asia.
For information about the Company, visit www.itape.com.
Forward-Looking Statements
This press release contains "forward-looking information" within the meaning of applicable Canadian securities legislation and "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (collectively, "forward-looking statements"), which are made in reliance upon the protections provided by such legislation for forward-looking statements. All statements other than statements of historical facts included in this press release, including statements regarding the Company's commitment to capital projects and expectations for after-tax internal rates of return; the Company's anticipated amount of capital expenditures in 2018; the Company's expected strategic and financial benefits from its ongoing capital investment, product development, manufacturing facility expansion and merger and acquisition programs; the Company's expected timing for completion of certain capital projects; the Company's synergies from the Cantech Acquisition; the Company's organic growth expectations for the current fiscal year; the Company's future competitive position and shareholder value; and the Company's fiscal year and first quarter 2018 outlook, including Adjusted EBITDA, gross margin, capital expenditures, effective tax rate and income tax expenses and revenue, may constitute forward-looking statements.
These forward-looking statements are based on current beliefs, assumptions, expectations, estimates, forecasts and projections made by the Company's management. Words such as "may," "will," "should," "expect," "continue," "intend," "estimate," "anticipate," "plan," "foresee," "believe" or "seek" or the negatives of these terms or variations of them or similar terminology are intended to identify such forward-looking statements. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, these statements, by their nature, involve risks and uncertainties and are not guarantees of future performance. Such statements are also subject to assumptions concerning, among other things: business conditions and growth or declines in the Company's industry, the Company's customers' industries and the general economy; the anticipated benefits from the Company's manufacturing facility closures and other restructuring efforts; the anticipated benefits from the Company's manufacturing facility capacity expansions; the anticipated benefits from the Company's acquisitions and partnerships; the anticipated benefits from the Company's capital expenditures; the quality and market reception of the Company's products; the Company's anticipated business strategies; risks and costs inherent in litigation; the Company's ability to maintain and improve quality and customer service; anticipated trends in the Company's business; anticipated cash flows from the Company's operations; availability of funds under the Company's Revolving Credit Facility; and the Company's ability to continue to control costs.
The Company can give no assurance that these estimates and expectations will prove to have been correct. Actual outcomes and results may, and often do, differ from what is expressed, implied or projected in such forward-looking statements, and such differences may be material. Readers are cautioned not to place undue reliance on any forward-looking statement. For additional information regarding important factors that could cause actual results to differ materially from those expressed in these forward-looking statements and other risks and uncertainties, and the assumptions underlying the forward-looking statements, you are encouraged to read "Item 3 Key Information - Risk Factors", "Item 5 Operating and Financial Review and Prospects (Management's Discussion & Analysis)" and statements located elsewhere in the Company's annual report on Form 20-F for the year ended December 31, 2016 and the other statements and factors contained in the Company's filings with the Canadian securities regulators and the US Securities and Exchange Commission. Each of these forward-looking statements speaks only as of the date of this press release. The Company will not update these statements unless applicable securities laws require it to do so.
Note to readers: Complete consolidated financial statements and Management's Discussion & Analysis are available on the Company's website at www.itape.com in the Investor Relations section and under the Company's profile on SEDAR at www.sedar.com.
Intertape Polymer Group Inc.
Consolidated Earnings
Periods ended December 31,
(In thousands of US dollars, except per share amounts)
Three months ended
December 31 Years ended
(unaudited) December 31,
------------------- -------------------
2017 2016 2017 2016
------------------- -------------------
$ $ $ $
Revenue 237,404 209,909 898,126 808,801
Cost of sales 183,381 156,174 696,719 617,314
---------------------------------------
Gross profit 54,023 53,735 201,407 191,487
---------------------------------------
Selling, general and administrative
expenses 34,125 25,576 107,592 102,580
Research expenses 2,889 3,227 11,601 10,790
---------------------------------------
37,014 28,803 119,193 113,370
---------------------------------------
Operating profit before manufacturing
facility closures, restructuring and
other related charges (recoveries) 17,009 24,932 82,214 78,117
Manufacturing facility closures,
restructuring and other related
charges (recoveries) 466 (7,744) 1,359 2,408
---------------------------------------
Operating profit 16,543 32,676 80,855 75,709
Finance costs (income)
Interest 2,525 1,236 7,246 4,398
Other expense (income), net (4,693) 15 (3,398) 605
---------------------------------------
(2,168) 1,251 3,848 5,003
Earnings before income tax expense
(benefit) 18,711 31,425 77,007 70,706
Income tax expense (benefit)
Current (1,064) 3,454 6,635 8,757
Deferred (1,405) 6,272 6,414 10,812
---------------------------------------
(2,469) 9,726 13,049 19,569
---------------------------------------
Net earnings 21,180 21,699 63,958 51,137
---------------------------------------
---------------------------------------
Net earnings (loss) attributable to:
Company shareholders 21,319 21,682 64,224 51,120
Non-controlling interests (139) 17 (266) 17
---------------------------------------
21,180 21,699 63,958 51,137
---------------------------------------
---------------------------------------
Earnings per share attributable to
Company shareholders
Basic 0.36 0.37 1.09 0.87
Diluted 0.36 0.36 1.08 0.85
Intertape Polymer Group Inc.
Consolidated Cash Flows
Periods ended December 31,
(In thousands of US dollars)
Three months ended
December 31 Years ended
(unaudited) December 31,
------------------- -------------------
2017 2016 2017 2016
------------------- -------------------
$ $ $ $
OPERATING ACTIVITIES
Net earnings 21,181 21,699 63,958 51,137
Adjustments to net earnings
Depreciation and amortization 9,867 8,673 36,138 30,978
Income tax expense (benefit) (2,469) 9,726 13,049 19,569
Interest expense 2,525 1,236 7,246 4,398
Non-cash charges in connection with
manufacturing facility closures,
restructuring and other related
charges 149 217 133 5,204
Impairment of inventories 760 92 801 1,997
Share-based compensation expense 6,358 1,615 3,291 8,201
Pension, post-retirement and other
long-term employee benefits 655 803 2,730 2,913
Gain on foreign exchange (3,103) (357) (2,578) (510)
Impairment of assets 103 56 192 226
Other adjustments for non-cash
items (1,583) (27) (2,150) 50
Income taxes paid, net (436) (1,456) (6,452) (7,193)
Contributions to defined benefit
plans (915) (326) (4,143) (1,268)
---------------------------------------
Cash flows from operating activities
before changes in working capital
items 33,092 41,951 112,215 115,702
---------------------------------------
Changes in working capital items
Trade receivables 9,418 2,924 (6,847) (8,920)
Inventories 869 6,111 (7,879) (4,074)
Parts and supplies (428) (196) (2,090) (1,053)
Other current assets (752) 1,353 89 451
Accounts payable and accrued
liabilities and share-based
compensation liabilities,
current 17,407 14,563 (1,493) 5,304
Provisions (350) (1,754) (1,863) 725
---------------------------------------
26,164 23,001 (20,083) (7,567)
---------------------------------------
Cash flows from operating activities 59,256 64,952 92,132 108,135
---------------------------------------
INVESTING ACTIVITIES
Acquisition of subsidiaries, net of
cash acquired - - (67,027) (41,855)
Purchases of property, plant and
equipment (13,960) (14,170) (85,312) (49,972)
Proceeds from disposals of property,
plant and equipment 314 35 880 70
Purchase of intangible assets (1,868) (88) (1,914) (88)
Other investing activities (12) 242 458 (4)
---------------------------------------
Cash flows from investing activities (15,526) (13,981) (152,915) (91,849)
---------------------------------------
FINANCING ACTIVITIES
Proceeds from borrowings 39,578 25,206 257,021 180,604
Repayment of borrowings (82,576) (51,306) (162,107)(155,630)
Interest paid (2,806) (1,399) (7,360) (4,739)
Proceeds from exercise of stock
options - 630 1,362 1,452
Repurchases of common shares (1,014) - (7,451) (1,697)
Dividends paid (8,368) (8,047) (33,199) (31,365)
Other financing activities (15) 1 (529) (160)
---------------------------------------
Cash flows from financing activities (55,201) (34,915) 47,737 (11,535)
---------------------------------------
Net increase (decrease) in cash (11,471) 16,056 (13,046) 4,751
Effect of foreign exchange
differences on cash (220) (742) 1,183 (1,410)
Cash, beginning of period 20,784 5,642 20,956 17,615
---------------------------------------
Cash, end of period 9,093 20,956 9,093 20,956
---------------------------------------
---------------------------------------
Intertape Polymer Group Inc.
Consolidated Balance Sheets
As of
(In thousands of US dollars)
December 31, December 31,
2017 2016
------------ -------------
$ $
ASSETS
Current assets
Cash 9,093 20,956
Trade receivables 106,634 90,122
Inventories 128,233 103,470
Parts and supplies 18,571 16,368
Other current assets 16,188 11,321
--------------------------
278,719 242,237
Property, plant and equipment 313,520 233,478
Goodwill 41,690 30,841
Intangible assets 47,318 34,050
Deferred tax assets 27,627 36,611
Other assets 6,998 3,380
--------------------------
Total assets 715,872 580,597
--------------------------
--------------------------
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities 104,812 98,016
Share-based compensation liabilities, current 10,265 2,200
Call option redemption liability 12,725 -
Provisions, current 657 3,851
Borrowings, current 14,979 7,604
--------------------------
143,438 111,671
Borrowings, non-current 264,484 172,221
Pension, post-retirement and other long-term
employee benefits 29,298 30,832
Share-based compensation liabilities, non-current 4,984 296
Non-controlling interest put options - 10,020
Deferred tax liabilities 13,769 9,332
Provisions, non-current 3,221 2,040
Other liabilities 1,956 1,242
--------------------------
461,150 337,654
--------------------------
EQUITY
Capital stock 350,759 351,203
Contributed surplus 17,530 29,585
Deficit (106,687) (124,605)
Accumulated other comprehensive loss (13,469) (19,647)
--------------------------
Total equity attributable to Company shareholders 248,133 236,536
Non-controlling interests 6,589 6,407
--------------------------
Total equity 254,722 242,943
--------------------------
Total liabilities and equity 715,872 580,597
--------------------------
--------------------------
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures as defined under applicable securities legislation, including EBITDA, adjusted EBITDA, and free cash flows (please see the "EBITDA and Adjusted EBITDA" section below for a description and reconciliation of EBITDA and adjusted EBITDA and the "Free Cash Flows" section below for a description and reconciliation of free cash flows). In determining these measures, the Company excludes certain items which are otherwise included in determining the comparable GAAP financial measures. The Company believes such non-GAAP financial measures improve the period-to-period comparability of the Company's results and provide investors with more insight into, and an additional tool to understand and assess, the performance of the Company's ongoing core business operations. As required by applicable securities legislation, the Company has provided definitions of those measures and reconciliations of those measures to the most directly comparable GAAP financial measures. Investors and other readers are encouraged to review the related GAAP financial measures and the reconciliation of non-GAAP financial measures to their most directly comparable GAAP financial measures set forth below and should consider non-GAAP financial measures only as a supplement to, and not as a substitute for or as a superior measure to, measures of financial performance prepared in accordance with GAAP.
EBITDA and Adjusted EBITDA
A reconciliation of the Company's EBITDA, a non-GAAP financial measure, to net earnings (loss), the most directly comparable GAAP financial measure, is set out in the EBITDA reconciliation table below. EBITDA should not be construed as earnings (loss) before income taxes, net earnings (loss) or cash flows from operating activities as determined by GAAP. The Company defines EBITDA as net earnings (loss) before (i) interest and other finance costs (income); (ii) income tax expense (benefit); (iii) amortization of intangible assets; and (iv) depreciation of property, plant and equipment. The Company defines adjusted EBITDA as EBITDA before (i) manufacturing facility closures, restructuring and other related charges (recoveries); (ii) advisory fees and other costs associated with mergers and acquisitions activity, including due diligence, integration and certain non-cash purchase price accounting adjustments ("M&A Costs"); (iii) share-based compensation expense (benefit); (iv) impairment of goodwill; (v) impairment (reversal of impairment) of long-lived assets and other assets; (vi) write-down on assets classified as held-for-sale; (vii) loss (gain) on disposal of property, plant and equipment; and (viii) other discrete items as shown in the table below. The terms "EBITDA" and "adjusted EBITDA" do not have any standardized meanings prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers.
EBITDA and adjusted EBITDA are not measurements of financial performance under GAAP and should not be considered as alternatives to cash flows from operating activities or as alternatives to net earnings (loss) as indicators of the Company's operating performance or any other measures of performance derived in accordance with GAAP. The Company has included these non-GAAP financial measures because it believes that they allow investors to make a more meaningful comparison between periods of the Company's performance, underlying business trends and the Company's ongoing operations. The Company further believes these measures may be useful in comparing its operating performance with the performance of other companies that may have different financing and capital structures, and tax rates. Adjusted EBITDA excludes costs that are not considered by management to be representative of the Company's underlying core operating performance, including certain non-operating expenses, non-cash expenses and non-recurring expenses. In addition, EBITDA and adjusted EBITDA are used by management to set targets and are metrics that, among others, can be used by the Company's Human Resources and Compensation Committee to establish performance bonus metrics and payout, and by the Company's lenders and investors to evaluate the Company's performance and ability to service its debt, finance capital expenditures and acquisitions, and provide for the payment of dividends to shareholders. The Company experiences normal business seasonality that typically results in adjusted EBITDA that is proportionately higher in the second, third and fourth quarters of the year relative to the first quarter.
EBITDA and Adjusted EBITDA Reconciliation to Net Earnings
(In millions of US dollars)
(Unaudited)
Three months
ended Year ended
December 31, December 31,
----------------- ----------------------
2017 2016 2017 2016 2015
----------------- ----------------------
$ $ $ $ $
Net earnings 21.2 21.7 64.0 51.1 56.7
Interest and other finance costs
(income) (2.2) 1.3 3.8 5.0 3.2
Income tax expense (benefit) (2.5) 9.7 13.0 19.6 11.0
Depreciation and amortization 9.9 8.7 36.1 31.0 30.9
----------------------------------------
EBITDA 26.4 41.3 117.0 106.7 101.7
Manufacturing facility closures,
restructuring and other related
charges (recoveries) 0.5 (7.7) 1.4 2.4 3.7
M&A Costs 2.2 0.3 7.5 2.4 2.0
Share-based compensation expense 6.4 1.6 3.3 8.2 3.2
Impairment (reversal of impairment)
of long-lived assets and other
assets 0.2 0.1 0.2 0.2 (5.8)
Loss (gain) on disposal of property,
plant and equipment - - 0.3 0.1 (0.8)
Other Item: Litigation Settlement - - - 1.9 -
----------------------------------------
Adjusted EBITDA (1) 35.7 35.6 129.6 122.0 104.0
----------------------------------------
----------------------------------------
(1) Prior period amounts presented have been conformed to the current
definition of adjusted EBITDA which excludes M&A Costs.
Free Cash Flows
Free cash flows is defined by the Company as cash flows from operating activities less purchases of property, plant and equipment.
The Company is including free cash flows, a non-GAAP financial measure, because it is used by management and investors in evaluating the Company's performance and liquidity. Free cash flows does not have any standardized meaning prescribed by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. Free cash flows should not be interpreted to represent the total cash movement for the period as described in the Company's Financial Statements, or to represent residual cash flow available for discretionary purposes, as it excludes other mandatory expenditures such as debt service.
A reconciliation of free cash flows to cash flows from operating activities, the most directly comparable GAAP financial measure, is set forth below.
Free Cash Flows Reconciliation to Cash Flows from Operating Activities
(In millions of US dollars)
(Unaudited)
Three months
ended Year ended
December 31, December 31,
----------------- ----------------------
2017 2016 2017 2016 2015
----------------- ----------------------
$ $ $ $ $
Cash flows from operating activities 59.3 65.0 92.1 108.1 102.3
Less purchases of property, plant
and equipment (14.0) (14.2) (85.3) (50.0) (34.3)
----------------------------------------
Free cash flows 45.3 50.8 6.8 58.2 68.0
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Contacts:
MaisonBrison Communications
Pierre Boucher
514-731-0000
