Full Year 2021 Results and Quarterly and Special DividendTree Island Steel Announces Full Year 2021 Results and Quarterly and Special Dividend VANCOUVER, British Columbia, March 02, 2022 (GLOBE NEWSWIRE) -- Tree Island Steel (''Tree Island'' or the ''Company'') (TSX: TSL) announced today its financial results for the year ended December 31, 2021.
For the threemonth period ended December 31, 2021, revenues increased by $21.8 million to $76.0 million from higher demand particularly in commercial construction, along with pricing increases across all market segments. Gross profit for the fourth quarter increased to $17.3 million, from $6.6 million in the same period in 2020, from increased sales volumes in the period and cost management. Adjusted EBITDA amounted to $12.6 million, compared to $4.5 million during the same period in 2020.
For the year ended December 31, 2021, revenues increased by $86.0 million to $301.8 million when compared to 2020. The increase is primarily due to higher shipped volumes across all market segments as well as pricing increases. Gross profit increased to $68.6 million from $25.9 million. The increased gross profit for the period is the result of higher sales volume, improved efficiencies, operating leverage from increased volumes, and cost management. The higher gross margins also resulted in an Adjusted EBITDA of $58.0 million, compared to $17.8 million during the same period in 2020.
“With increased construction in both residential and commercial sectors, along with agricultural and industrial growth driving demand for wire and wire products, higher sales volumes were achieved in 2021," said Remy Stachowiak, President and COO of Tree Island Steel. “In this inflationary cost environment, with increases in raw materials, labour, freight, consumables and utilities, along with labour constraints, we continue to closely manage our inventory and operations."
In November 2021, we purchased the Calgary property, which we were previously leasing, for a total of $11.3 million. This has not changed our operations in Calgary, but it will allow us to utilize the site in the future according to our business needs and eliminates the lease payment obligations.
In December 2021, we closed the sale of our Etiwanda land and building, with proceeds of this disposition driving a significant increase in net income and cash flow for the year. Following this transaction we entered into a twoyear leaseback of the facility, and we are currently reviewing options for the relocation of operations.
On March 2, 2022 the Board of Directors declared a regular quarterly dividend of $0.03 per share and an additional $1.20 per share as a special dividend on the issued and outstanding Common Shares of the Company, both payable on April 14, 2022 to holders of record at the close of business on March 31, 2022.
“We are very pleased with the results in 2021, as we continue to adapt to supply chain and labour constraints, as well as increasing costs. Through this volatility, we remain focused in supporting our customers throughout our endmarkets,” said Amar S. Doman, Executive Chair of Tree Island Steel.
| RESULTS FROM OPERATIONS | |
| ($'000 unless otherwise stated) | | | | | | | | | |
| | Three Months Ended
December 31, | | | Year Ended
December 31, | |
| | 2021 | | 2020 | | | 2021 | | 2020 | |
| Revenue | 75,954 | | 54,199 | | | 301,848 | | 215,894 | |
| Cost of sales | (57,191 | ) | (46,105 | ) | | (227,378 | ) | (184,008 | ) |
| Depreciation | (1,440 | ) | (1,487 | ) | | (5,843 | ) | (6,036 | ) |
| Gross profit | 17,323 | | 6,607 | | | 68,627 | | 25,850 | |
| Selling, general and administrative expenses | (5,833 | ) | (3,397 | ) | | (16,367 | ) | (13,954 | ) |
| Operating income | 11,490 | | 3,210 | | | 52,260 | | 11,896 | |
| Foreign exchange loss | (373 | ) | (226 | ) | | (140 | ) | (173 | ) |
| Gain on property, plant and equipment | 63,897 | | | | | 63,896 | | 5 | |
| Financing expenses | (679 | ) | (590 | ) | | (2,532 | ) | (4,335 | ) |
| Other expenses | (4 | ) | (20 | ) | | (6 | ) | (217 | ) |
| Income before income taxes | 74,331 | | 2,374 | | | 113,478 | | 7,176 | |
| Income tax expense | (15,290 | ) | (682 | ) | | (25,507 | ) | (2,045 | ) |
| Net income | 59,041 | | 1,692 | | | 87,971 | | 5,131 | |
| Net income per share | 2.08 | | 0.06 | | | 3.09 | | 0.18 | |
| Dividends per share | 0.08 | | 0.02 | | | 0.22 | | 0.08 | |
Financial position as at: |
December 31,
2021 | | |
December 31,
2020 | |
| Total assets | 225,806 | | | 146,549 | |
| Total noncurrent financial liabilities | 38,907 | | | 71,236 | |
| | | | | | |
| Adjusted EBITDA | | | | | |
| ($'000 unless otherwise states) | | | | | |
| | Three Months Ended
December 31, | | Year Ended
December 31, |
| | 2021 | | 2020 | | | 2021 | | 2020 | |
| Operating income | 11,490 | | 3,210 | | | 52,260 | | 11,896 | |
| Add back depreciation | 1,440 | | 1,487 | | | 5,843 | | 6,036 | |
| Foreign exchange loss | (373 | ) | (226 | ) | | (140 | ) | (173 | ) |
| Adjusted EBITDA1 | 12,557 | | 4,471 | | | 57,963 | | 17,759 | |
1 See definition on Adjusted EBITDA in Section 2 NONIFRS MEASURES of the December 31, 2021, MD&A.