VANCOUVER, BC --(Marketwired - March 30, 2017) - WesternOne Inc.
("WesternOne") (TSX: WEQ) (TSX: WEQ.DB) today
announced the release of its financial results for the year ended December 31, 2016.
The results, consisting of WesternOne's audited financial statements for the year ended December 31, 2016 and Management's
Discussion and Analysis ("MD&A") dated March 30, 2017, are available on SEDAR (www.sedar.com).
2016 Q4 and annual financial summary:
- WesternOne recorded Q4 consolidated revenue of $20.7 million, gross profit of $6.7 million and adjusted EBITDA (as defined
below) of $3.1 million, compared to the respective amounts of $20.5 million, $8.0 million and $4.5 million in Q4 of 2015.
WesternOne's operating results from continuing operations excluded the businesses of its subsidiary Britco LP
("Britco") for 2016 (and comparative information in prior years, as appropriate) as WesternOne classified
Britco as discontinued operations in accordance with IFRS. Readers can refer to WesternOne's news release dated March 6, 2017
for details relating to its sale of Britco's Rental and US Manufacturing businesses for total cash consideration of
approximately $45.1 million (the "Transactions").
- Revenue generated from WesternOne Infrastructure Services ("WIS") was consistent with the prior year
period due to a comparatively colder winter season in Alberta in late 2016, increasing rental demand for temporary construction
heaters and related fuel and services, although the related positive impact was offset by compressed rental rates and fuel
margins as a result of competition. Gross profit and adjusted EBITDA decreased due to the compressed operating leverage, as
operating costs remained high to keep up with the higher rental volumes.
- Net change in cash position from continuing operations was negative $7.2 million, compared to negative $7.7 million in Q4
of 2015. The negative change in cash position was primarily due to rental fleet investments to meet heat-related demands and
working capital deployed in respect of the construction heat season. Cash collections relating to the construction heat season
has been underway throughout early 2017 and is expected to continue in Q2 of 2017.
- Net loss from continuing operations attributable to shareholders was $31.9 million ($1.87 per share), compared to net
income of $29.3 million ($25.87 per share) in Q4 of 2015. Included in the net loss were non-cash pre-tax impairment charges on
goodwill and intangible assets of $18.5 million in Q4 of 2016, in light of the weak equipment rentals market conditions in
Western Canada. The Q4 financial results also included non-cash pre-tax finance expense of $0.2 million, relating to changes in
the fair value of convertible debentures at year-end. Excluding these non-cash items on an after-tax basis, net loss for Q4 of
2016 would have been $13.6 million ($0.80 per share), compared to net loss of $2.1 million ($1.82 per share) in the prior year
after adjusting for like items.
- On March 6, 2017, pursuant to the Transactions WesternOne made a lump sum repayment of $25.7 million towards the senior
credit facility. Total bank indebtedness after the repayment was $10.0 million, down significantly from $45.2 million at the
end of 2016 and $42.8 million at the end of 2015.
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| Summary Financial Overview |
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| ($ millions except per share amounts) |
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Three months ended December 31, |
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Year ended December 31, |
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2016 |
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2015 |
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2016 |
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2015 |
| Revenue from Continuing Operations |
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$ |
20.7 |
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$ |
20.5 |
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$ |
68.9 |
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$ |
83.0 |
| Gross Profit from Continuing Operations |
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6.7 |
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8.0 |
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22.4 |
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34.3 |
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| Adjusted EBITDA (1) (2) |
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3.1 |
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4.5 |
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8.0 |
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18.2 |
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| Net Income/(Loss) from Continuing Operations (2) |
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(31.9) |
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29.3 |
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(62.7) |
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18.1 |
| Net Income (Loss) from Discontinued Operations (2) |
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(10.6) |
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(39.5) |
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(20.1) |
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(37.6) |
| Net Loss (2) |
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(42.5) |
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(10.2) |
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(82.8) |
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(19.5) |
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| Income/(Loss) per share from Continuing Operations (2) (3) |
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(1.87) |
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25.87 |
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(8.25) |
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16.03 |
| Loss per share (2) (3) |
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(2.50) |
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(8.98) |
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(10.90) |
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(17.28) |
_________________
(1)
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"Adjusted EBITDA" is not a recognized measure under IFRS and does not have a
standardized meaning prescribed by IFRS. "Adjusted EBITDA" refers to net income or loss from continuing operations before
interest, taxes, depreciation and amortization, and other specified items that would impact comparability including, where
applicable, non-operational income and expenses, securities-based compensation and other gains or losses. The use of the
term "non-operational income and expenses" is defined by WesternOne as those that do not impact operating decisions taken
by WesternOne's management as well as items of an unusual nature that do not reflect WesternOne's ongoing operations. For a
full description of adjusted EBITDA, refer to "Non-IFRS Measures" in the MD&A dated March 30, 2017. |
| (2) |
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Represents amount attributable to shareholders.
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(3)
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Income/(Loss) per share for prior periods have been adjusted on a retroactive basis
to reflect the consolidation of WesternOne's issued and outstanding common shares on the basis of one post-consolidation
common share for every 35 pre-consolidation common shares (the "Consolidation"). The Consolidation was
completed on October 31, 2016. |
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"The operating environment of our WIS business remained challenging throughout Q4. While we benefited from a colder winter
heat season compared to the previous year, WIS continued to be negatively impacted by market-driven factors including reduced
construction activities particularly in Alberta and rental rate competition in all major markets. In spite of these challenges,
our strategy of redeploying rental fleet to targeted markets and focusing on major projects within the heat business has helped
us maintain market share and competitiveness," said Peter Blake, CEO of WesternOne. "We will continue to focus on growing
revenues and managing capital returns and liquidity as we continue to navigate through the current economic environment."
Conference Call
Peter Blake, CEO, and the management team will host a conference call at 11:00am (Eastern time) or 8:00am (Pacific time), on
Friday, March 31, 2017 to review the financial results and corporate developments for the year ended December 31, 2016.
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.
Dial in numbers: Toll Free 1-888-390-0546
International or Local Toronto 1-416-764-8688
Conference Call Replay
If you cannot participate on March 31, 2017, 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 April 17, 2017. Please enter the Replay ID number 515879 followed by the # key.
Replay Dial-In: Toll Free 1-888-390-0541
International or Local Toronto 1-416-764-8677
Forward-looking Information
Certain statements in this news 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: timing
of cash collections in respect of working capital as at December 31, 2016; and WesternOne's intention to continue to focus on
growing revenues and managing capital returns and liquidity in the current economic environment. Actual events or results may
differ materially.
Forward-looking information contained in this news release is based on certain key expectations and assumptions made by
WesternOne, including, without limitation: the stability of the economy in Western Canada, the impact of the current economic
climate in Western Canada on WesternOne's operations will remain consistent with WesternOne's current expectations, the increased
competitive environment in which WesternOne and its business units operate; a protracted period of lower crude oil prices; the
supply and demand for WesternOne's products and services and the related impact on the pricing on such products and services will
remain consistent with WesternOne's current expectations; and management's assessment of future plans and operations. Although
the forward-looking information contained in this news 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 news 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, 2017 and MD&A dated March 30, 2017, which are both 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 news 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.
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF
THIS RELEASE.