Savaria Corporation (“Savaria”) (TSX: SIS), a global leader in
the accessibility industry, is pleased to announce its results for
the third quarter of fiscal 2022.
Highlights – Q3 2022 compared to Q3
2021
- Revenue
was $201.4M, up $20.6M or 11.4%, due to organic growth of 15.7%
coming from all segments partially offset by a negative foreign
exchange impact of 4.3%.
- Gross
profit was $64.0M, up $5.5M or 9.3%, representing 31.8% of revenue
compared to 32.4% in Q3 2021.
-
Operating income was $17.5M, up $7.1M or 68.9%, representing 8.7%
of revenue compared to 5.7% in Q3 2021.
- Adjusted
EBITDA was $31.0M, up $4.7M or 17.9%, compared to Q3 2021.
- Adjusted
EBITDA margin stood at 15.4%, up 80 bps compared to 14.6% in Q3
2021.
- Net
earnings were $10.6M, or $0.16, per share on a diluted basis,
compared to $4.8M or $0.07 per share on a diluted basis in Q3
2021.
- Funds available of $101.7M, as of
September 30, 2022, to support working capital, investments and
growth opportunities.
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in thousands of dollars, except per-share amounts and
percentages |
Q3 |
YTD |
2022 |
2021 |
Change |
2022 |
2021 |
Change |
|
|
(Recast |
1) |
|
|
|
|
(Recast |
1) |
|
Revenue |
$201,394 |
|
$180,758 |
|
11.4 |
% |
$576,991 |
|
$471,454 |
|
22.4 |
% |
Gross profit |
$64,044 |
|
$58,575 |
|
9.3 |
% |
$188,147 |
|
$155,866 |
|
20.7 |
% |
% of revenue |
31.8 |
% |
32.4 |
% |
(60) |
bps |
32.6 |
% |
33.1 |
% |
(50) |
bps |
Net earnings |
$10,581 |
|
$4,757 |
|
122.4 |
% |
$24,053 |
|
$10,590 |
|
127.1 |
% |
%
of revenue |
5.3 |
% |
2.6 |
% |
270 |
bps |
4.2 |
% |
2.2 |
% |
200 |
bps |
Diluted net earnings per share |
$0.16 |
|
$0.07 |
|
128.6 |
% |
$0.37 |
|
$0.17 |
|
117.6 |
% |
Adjusted net earnings* |
$11,177 |
|
$5,227 |
|
113.8 |
% |
$26,833 |
|
$16,849 |
|
59.3 |
% |
%
of revenue |
5.5 |
% |
2.9 |
% |
260 |
bps |
4.7 |
% |
3.6 |
% |
110 |
bps |
Diluted adjusted net earnings per share* |
$0.18 |
|
$0.07 |
|
157.1 |
% |
$0.42 |
|
$0.27 |
|
55.6 |
% |
Adjusted EBITDA * |
$31,024 |
|
$26,313 |
|
17.9 |
% |
$86,915 |
|
$71,000 |
|
22.4 |
% |
% of revenue |
15.4 |
% |
14.6 |
% |
80 |
bps |
15.1 |
% |
15.1 |
% |
- |
|
* Non-IFRS measures
are described in sections 3 and 6 of the MD&A |
1Refer to Note 2B) -
Adjustments to comparative figures in the interim condensed
consolidated financial statements of Q3 2022. |
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A Word from the President
“We have realized strong results in our third quarter with
revenue of $201.4M, an 11.4% increase year-over-year. Organic
growth contributed a 15.7% increase and was somewhat offset by 4.3%
of negative foreign currency headwinds. Adjusted EBITDA reached
$31.0M in the quarter, representing favorable growth of 17.9% over
last year’s third quarter results,” said Marcel Bourassa, Savaria's
President and Chief Executive Officer.
“Our new factory in Querétaro, Mexico, built over the past seven
months has started its operations on November 1st, 2022, and will
complement our two similar facilities in China. With its proximity
to our strong North America dealer network, this new assembly
location will be instrumental for us to meet capacity needs for our
2025 revenue goal of $1 billion. "
“Strong bookings in our third quarter underscore our continued
optimism for reaching our projections made in February 2022. Our
industry continues to offer us incredible potential and I thank my
2,250 employees around the world as well as our dedicated dealer
network for their support,” concluded Mr. Bourassa.
Third Quarter Results -
Q3 2022 compared to Q3 2021
Revenue
Revenue reached $201.4M, up $20.6M or 11.4%. The growth was
mainly due to strong organic growth of 15.7%.
-
Accessibility segment (72% of Q3-22 revenue):
Revenue was $145.4M, an increase of $9.8M or 7.2%. Organic revenue
growth stood at 13.3%.
-
Patient Care segment (21% of Q3-22 revenue):
Revenue was $42.8M, an increase of $8.0M or 23.0%. Organic revenue
growth stood at 21.2%.
-
Adapted Vehicles segment (7% of Q3-22 revenue):
Revenue was $13.2M, an increase of $2.9M or 27.7%. Organic revenue
growth stood at 28.8%.
Adjusted EBITDA
Adjusted EBITDA and adjusted EBITDA margin, both before head
office costs, stood at $32.8M and 16.3%, respectively, compared to
$28.4M and 15.7% for Q3 2021.
-
Accessibility segment: Adjusted EBITDA and
adjusted EBITDA margin, both before head office costs, stood at
$26.1M and 18.0%, respectively, compared to $24.7M and 18.2% for Q3
2021.
- Patient
Care segment: Adjusted EBITDA and adjusted EBITDA margin,
both before head office costs, stood at $5.9M and 13.8%,
respectively, compared to $3.1M and 8.8% for Q3 2021.
- Adapted
Vehicles segment: Adjusted EBITDA and adjusted EBITDA
margin, both before head office costs, stood at $0.8M and 6.0%,
respectively, compared to $0.6M and 6.1% for Q3 2021.
Net Earnings and Adjusted Net
Earnings
Net earnings for the quarter were $10.6M or $0.16 per share on a
diluted basis, compared to $4.8M or $0.07 per share for the same
period in 2021.
Adjusted net earnings stood at $11.2M, or $0.18 per share,
compared to $5.2M or $0.07 per share in Q3 2021.
Nine-Month Results - YTD 2022 compared
to YTD 2021
Revenue
The Corporation generated revenue of $577.0M, up
$105.5M or 22.4%. The increase is mainly due to organic growth of
12.5% and the acquisition of Handicare in 2021. The growth was
partially offset by a negative foreign exchange impact of 2.5%.
Adjusted EBITDA
Adjusted EBITDA and adjusted EBITDA margin, both
before head office costs, stood at $92.5M and 16.0%, respectively,
compared to $75.9M and 16.1% in 2021.
Net Earnings and Adjusted Net
Earnings
The Corporation’s net earnings stood at $24.1M
or $0.37 per share on a diluted basis, compared to $10.6M or $0.17
per share in 2021. Adjusted net earnings were $26.8M or $0.42 per
share on a diluted basis, compared to $16.8M or $0.27 in 2021, up
59.3% and $0.15, respectively.
Liquidity and Capital
Resources
Savaria generated $46.9M of cash from operations which were
primarily used to invest in capital projects, repay debt, and pay
interest and dividends.
As at September 30, 2022, the Corporation had a net debt
position of $398.3M.
Outlook
Savaria expects to generate revenue of approximately $775M and
adjusted EBITDA in the low range of $120M to $130M in fiscal 2022,
based on the following assumptions:
- Considering Handicare acquisition date of March 4, 2021,
Handicare will be consolidated for a period of 12 months in fiscal
2022 compared to 10 months in fiscal 2021.
- Organic growth coming from the Accessibility and Patient Care
segments is expected to continue due to strong demand.
- The integration and anticipated synergies of Handicare are
progressing in-line with management’s plan.
- Management’s ability to continue to effectively manage supply
chain challenges, including higher freight costs and availability,
as well as overall inflation costs.
- This outlook excludes the financial contribution from any new
acquisition.
Environmental, Social and Governance (“ESG”)
Values
As a global leader within the accessibility industry, Savaria is
committed to minimizing its environmental footprint and upholding
the highest social and governance standards. We believe that
promoting environmentally and socially responsible behaviour across
our organization is key to achieving sustainable growth and
long-term value creation.
As we advance an ESG strategy that will positively impact our
company and the communities in which we operate, our first step is
to identify the ESG risks and opportunities that are critical to
our business. To that end, and with the support of external
consultants, we are preparing our first materiality assessment to
survey and validate the most important ESG issues prioritized by
our stakeholders. The results of this assessment will help narrow
our focus and our guide decision-making.
About Savaria Corporation
Savaria Corporation (savaria.com) is a global leader in the
accessibility industry. It provides accessibility solutions for the
physically challenged to increase their comfort, their mobility and
their independence. Its product line is one of the most
comprehensive on the market. Savaria designs, manufactures,
distributes and installs accessibility equipment, such as
stairlifts for straight and curved stairs, vertical and inclined
wheelchair lifts and elevators for home and commercial use. It also
manufactures and markets a comprehensive selection of pressure
management products for the medical market, medical beds for the
long-term care market, as well as an extensive line of medical
equipment and solutions for the safe handling of patients,
including ceiling lifts and slings. In addition, Savaria converts
and adapts vehicles for personal and commercial uses. The
Corporation operates a sales network of dealers worldwide and
direct sales offices in North America, Europe (UK, Netherlands,
Switzerland, Italy, Germany, Poland and Czech Republic), Australia
and China. Savaria employs approximately 2,250 people globally and
its plants are located across Canada, the United States, Europe and
China.
Compliance with International Financial Reporting
Standards (“IFRS”)
The information appearing in this press release has been
prepared in accordance with IFRS. However, Savaria uses EBITDA,
adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA before
head office costs, adjusted EBITDA margin before head office costs,
adjusted net earnings, adjusted net earnings per share and net debt
for analysis purposes to measure its financial performance. These
measures have no standardized definitions in accordance with IFRS
and are therefore regarded as non-IFRS measures. These measures may
therefore not be comparable to similar measures reported by other
companies. Additional details for these non-IFRS measures can be
found in sections 3 and 6 of Savaria’s MD&A, which is posted on
Savaria’s website at www.savaria.com, and filed with SEDAR at
www.sedar.com. Reconciliation of adjusted net earnings and adjusted
EBITDA with net earnings is presented in the section below.
Forward-Looking Statements
This press release includes certain statements that are
“forward-looking statements” within the meaning of the securities
laws of Canada. Any statement in this press release that is not a
statement of historical fact may be deemed to be a forward-looking
statement. When used in this press release, the words “believe”,
“could”, “should”, “intend”, “expect”, “estimate”, “assume” and
other similar expressions are generally intended to identify
forward-looking statements. It is important to know that the
forward-looking statements in this document describe the
Corporation’s expectations as at the date hereof, which are not
guarantees of future performance of Savaria or its industry, and
involve known and unknown risks and uncertainties that may cause
Savaria’s or the industry’s outlook, actual results or performance
to be materially different from any future results or performance
expressed or implied by such statements. The Corporation’s actual
results could be materially different from its expectations if
known or unknown risks affect its business, or if its estimates or
assumptions turn out to be inaccurate.
A change affecting an assumption can also have an impact on
other interrelated assumptions, which could increase or diminish
the effect of the change. As a result, the Corporation cannot
guarantee that any forward-looking statement will materialize and,
accordingly, the reader is cautioned not to place undue reliance on
these forward-looking statements. Forward-looking statements do not
take into account the effect that transactions or special items
announced or occurring after the statements are made may have on
the Corporation’s business. For example, they do not include the
effect of sales of assets, monetizations, mergers, acquisitions,
other business combinations or transactions, asset write-downs or
other charges announced or occurring after forward-looking
statements are made.
Unless otherwise required by applicable securities laws, Savaria
disclaims any intention or obligation to update or revise the
forward-looking statements, whether as a result of new information,
future events or otherwise. The foregoing risks and uncertainties
include the risks set forth under “Risks and Uncertainties” in
Savaria’s latest Annual MD&A as well as other risks detailed
from time to time in reports filed by Savaria with securities
regulators in Canada.
Results webcast and conference call on November 3, 2022, at 8:30
a.m. (EDT) |
Savaria will host a conference call on Thursday,
November 3 at 8:30 a.m. Eastern Daylight Time with financial
analysts to discuss results of the quarter and fiscal year ended
September 30, 2022. Investors and members of the media are invited
to participate on a listen-only basis.
Conference call access:
Canada Toll Free Number:
Toronto: 1 (647)
484-0258
Montreal: 1 (438)
320-0340
North American Toll Free Number: 1 (800)
289-0720Webcast (EN): https://app.webinar.net/X4aBzXKlRbALink to
the replay of the webcast will be available on the Corporation’s
website at www.savaria.com
For further information: |
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|
Marcel BourassaChairman, President and Chief Executive
Officer1.800.661.5112mbourassa@savaria.com |
Stephen Reitknecht, CPA, CAChief Financial Officer1.800.661.5112,
ext. 3370sreitknecht@savaria.com |
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www.savaria.comFacebook :
www.facebook.com/savariabettermobilityTwitter: twitter.com/Mobilityforlife
Reconciliation of adjusted net earnings and adjusted EBITDA with
net earnings is provided below. Complete financial statements and
the management’s report for Q3 2022 will be available shortly on
Savaria’s website and on SEDAR (www.sedar.com).
Reconciliation of adjusted net earnings and adjusted
EBITDA with net earnings
in thousands of dollars, except per-share |
Q3 |
YTD |
2022 |
2021 |
2022 |
2021 |
|
|
(Recast |
1) |
|
(Recast |
1) |
Net earnings |
$10,581 |
|
$4,757 |
|
$24,053 |
|
$10,590 |
|
Other expenses |
757 |
|
692 |
|
3,621 |
|
7,164 |
|
Income taxes related to other expenses* |
(161 |
) |
(222 |
) |
(841 |
) |
(905 |
) |
Adjusted net earnings* |
$11,177 |
|
$5,227 |
|
$26,833 |
|
$16,849 |
|
Diluted adjusted net earnings per share* |
$0.18 |
|
$0.07 |
|
$0.42 |
|
$0.27 |
|
Income taxes related to other expenses* |
161 |
|
222 |
|
841 |
|
905 |
|
Income tax expense |
4,469 |
|
3,136 |
|
9,753 |
|
5,688 |
|
Depreciation of fixed assets |
2,063 |
|
1,840 |
|
6,044 |
|
5,077 |
|
Depreciation of right-of-use assets |
2,645 |
|
2,554 |
|
7,839 |
|
6,591 |
|
Amortization of intangible assets |
7,329 |
|
10,282 |
|
23,725 |
|
25,308 |
|
Net finance costs |
2,481 |
|
2,489 |
|
10,292 |
|
9,399 |
|
Stock-based compensation |
699 |
|
563 |
|
1,588 |
|
1,183 |
|
Adjusted EBITDA* |
$31,024 |
|
$26,313 |
|
$86,915 |
|
$71,000 |
|
Diluted weighted average number of shares |
64,466,506 |
|
64,639,035 |
|
64,507,643 |
|
61,428,909 |
|
* Non-IFRS measures are described in sections 3 and 6 of the
MD&A |
1Refer to Note 2B) - Adjustments to comparative figures in the
interim condensed consolidated financial statements of Q3
2022. |
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