WesternOne Inc. Reports 2015 Q1 Results

VANCOUVER, May 13, 2015 /CNW/ - WesternOne Inc. ("WesternOne") (Toronto Stock Exchange: WEQ, WEQ.DB, and WEQ.DB.C) today announced the release of its financial results for the three months ended March 31, 2015.

The results, consisting of WesternOne's interim financial statements for the three months ended March 31, 2015 and Management's Discussion and Analysis ("MD&A") dated May 13, 2015, are available on SEDAR (www.sedar.com).

2015 Q1 financial highlights:

• Consolidated revenue of $88.3 million, gross profit of $26.6 million and adjusted EBITDA⁽¹⁾ of $16.2 million, compared with the respective amounts of $99.0 million, $23.5 million and $14.2 million in Q1 of 2014.
  
  
• Adjusted EBITDA margin was 18.4%, up from 14.4% in Q1 of 2014.
  
  
• Net cash from operating activities was $25.0 million, up from $8.8 million in Q1 of 2014. The operating cash flow reflects year-over-year growth in adjusted EBITDA of 14.1% and more effective working capital management relating to large work camp projects.
  
  
• Net income from continuing operations attributable to shareholders was $4.2 million ($0.11 per share), compared with $3.7 million ($0.12 per share) in Q1 of 2014.
  
  
• Capital expenditures on property, plant and equipment, net of disposals, was $0.1 million compared with $6.3 million in Q1 of 2014. The reduction reflected management's focus on optimizing returns through redeploying internal capital.

WIS, WesternOne's infrastructure services division, recorded Q1 revenue of $30.3 million and adjusted EBITDA of $12.9 million, representing year-over-year growth of 3.9% and 24.2%, respectively. The growth was primarily due to: (i) contribution from the acquired flameless heater business unit; (ii) increased fleet size and utilization of aerial equipment; and (iii) higher dollar contribution from fuel sales due to higher margins. The increase was partially offset by lower construction heater rentals due to an unseasonably mild weather in the first quarter in Alberta and higher operating costs.

Britco, WesternOne's modular construction and modular space rental division, recorded Q1 revenue of $58.0 million, compared with $70.0 million in Q1 of 2014. The decline was primarily due to the reduction of low-margin onsite construction work, as Phase 1 of the Manitoba Hydro Keeyask workforce accommodations project was substantially completed. Adjusted EBITDA was $5.6 million, up 4.9% from $5.3 million in Q1 of 2014 mainly due to higher manufacturing output and efficiency resulting from long runs of work camp productions at the manufacturing facilities in Canada. The increase was partially offset by lower output from the US operations, primarily due to the reduced demand from the shale oil and gas sector.

Corporate overhead before amortization and share-based compensation was $2.3 million, compared with $1.4 million in Q1 of 2014. The increase related to investments in the corporate support of the company's operations.

"We were pleased with our first quarter operating results, including our adjusted EBITDA, cash generated from operations, and our improved working capital position," said Mr. Peter Blake, CEO of WesternOne. "Looking past Q1, we anticipate the continuation of a challenging economic environment for many business areas in which WesternOne operates. In response, we have rationalized some rental branches and redeployed fleet and related capital in our WIS operations, reduced headcount and other related overhead in our Britco operations to better align our costs to estimated workload, and restricted related capital expenditures."

"Our focus for the rest of 2015 continues to be preservation of cash from sustainable operations, cost management, and orderly servicing and repayment of debt, while pursuing alternatives for our current debt structure," continued Mr. Blake.

Conference Call

Peter Blake, CEO, and the management team will host a conference call at 9:00am (Eastern time) or 6:00am (Pacific time), on Thursday May 14, 2015, to review the financial results and corporate developments for the three months ended March 31, 2015.

To participate in this conference call, please dial one of the following numbers approximately 10 minutes prior to the commencement of the call, and ask to join the WesternOne conference call.

Conference Call Replay

If you cannot participate on May 14, 2015, a replay of the conference call will be available by dialing one of the following replay numbers. You will be able to dial in and listen to the conference two hours after the meeting end time, and the replay will be available until May 21, 2015. Please enter the Replay ID number 299792 followed by the # key.

Forward-looking Information

Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such information includes, without limitation, statements with respect to: management's focus for the rest of 2015 of preserving cash from sustainable operations, cost management, and orderly servicing and repayment of debt; management's belief in the continuation of a challenging economic environment for many business areas in which WesternOne operates; and WesternOne's intention to pursue alternatives for its current debt structure. Actual events or results may differ materially.

Forward-looking information contained in this press release is based on certain key expectations and assumptions made by WesternOne, including, without limitation: the outlook of WesternOne's business and the economy in Western Canada and the US, the supply and demand for WesternOne's products and services and management's assessment of future plans and operations. Although the forward-looking information contained in this press release is based upon what WesternOne's management believes to be reasonable assumptions, WesternOne cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in WesternOne's Annual Information Form dated March 30, 3015 and Management's Discussion and Analysis dated May 13, 2015, which are available on SEDAR (www.sedar.com).

The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management's current beliefs and is based on information currently available to WesternOne. The forward-looking information is made as of the date of this press release and WesternOne assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.

About WesternOne

WesternOne seeks to acquire and grow businesses in the construction and infrastructure services sectors in order to generate value for its shareholders.

Additional Information

Additional information relating to WesternOne and other public filings, is available on SEDAR at www.sedar.com or on WesternOne's website at www.weq.ca.

Trading Symbols
Toronto Stock Exchange: WEQ, WEQ.DB, and WEQ.DB.C

THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF THIS RELEASE.

SOURCE WesternOne Inc.