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GDI Integrated Facility Services Inc. Releases its Financial Results for the Third Quarter Ended September 30, 2021

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  • GDIFF
  • Q3 2021 revenue of $408.4 million – an increase $43.0 million, or 11.8%, over Q3 2020.

  • Q3 2021 Adjusted EBITDA1 of $32.7 million – an increase of $2.5 million, or 8.4%, over Q3 2020.

  • Q3 2021 net income of $9.4 million or $0.41 per share compared with $13.2 million or $0.59 per share in the third quarter of 2020.

  • Two acquisitions completed in the quarter: Enginuity, LLC, and Fuller Industries, LLC.

LASALLE, QC, Nov. 10, 2021 /CNW Telbec/ - GDI Integrated Facility Services Inc. ("GDI" or the "Company") (TSX:GDI) is pleased to announce its financial results for its third quarter ended September 30, 2021.

For the third quarter of 2021:

  • Revenue reached $408.4 million, an increase of $43.0 million, or 11.8%, over the third quarter of 2020. Organic revenue growth was 2.9%, growth from acquisitions was 10.2%, and revenue growth was partially offset by a negative exchange rate effect of 1.3%.

  • Adjusted EBITDA1 amounted to $32.7 million, an increase of $2.5 million, or 8.4%, over the third quarter of 2020.

  • Net income was $9.4 million or $0.41 per share compared to $13.2 million or $0.59 per share in Q3 2020.

  • Long-term debt increased by $15.8 million from $177.0 million on June 30, 2021 to $192.8 million on September 30, 2021, while cash, net of bank indebtedness, decreased by $18.6 million over the same period, totalling to a $34.4 million increase in long-term debt, net of cash and bank indebtedness. This increase is mainly related to the Enginuity and Fuller acquisitions, which accounted for an increase of $43.2 million of long-term debt.

For the third quarters of 2021 and 2020, the business segments performed as follows:

(in thousands of

Canadian dollars)

Janitorial Canada

Janitorial USA

Technical Services

Complementary
Services

Consolidated

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Revenue

132,528

135,969

85,909

83,716

179,131

129,063

14,797

21,593

408,356

365,358

Organic Growth (Decline)

(2.5%)

1.5%

7.9%

(2.2%)

11.0%

(10.1%)

(35.7%)

22.4%

2.9%

(1.1%)

Adjusted EBITDA1

18,372

18,435

8,142

7,167

10,389

5,154

(1,066)

2,353

32,720

30,191

Adjusted EBITDA Margin1

13.9%

13.6%

9.5%

8.6%

5.8%

4.0%

(7.2%)

10.9%

8.0%

8.3%


______________________

1 The terms "Adjusted EBITDA" and "Adjusted EBITDA Margin" do not have standardized definitions prescribed by International Financial Reporting Standards and therefore, may not be comparable to similar measures presented by other companies. "Adjusted EBITDA" is defined as operating income before depreciation and amortization, Canadian Emergency Wage Subsidy and related expenses, transaction, reorganization and other costs and share-based compensation. The Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by revenues. For more details and for a reconciliation of that measure to the most directly comparable IFRS measure, consult the "Operating and Financial Results" section of the Company's Management Discussion & Analysis (MD&A).

For the nine-month period ended September 30, 2021:

  • Revenue reached $1.164 billion, an increase of $117.2 million, or 11.2%, over the corresponding period of 2020. Organic revenue growth was 3.2%, growth from acquisitions was 10.0%, and revenue growth was partially offset by a negative exchange rate effect of 2.0%.

  • Adjusted EBITDA1 amounted to $99.2 million, an increase of $26.5 million, or 36.4%, over the corresponding period of 2020.

  • Net income was $36.5 million or $1.59 per share compared to $31.0 million or $1.42 per share in the corresponding period of 2020.

  • Long-term debt increased by $24.1 million from $168.7 million on December 31, 2020 to $192.8 million on September 30, 2021, while cash, net of bank indebtedness, also increased by $2.8 million over the same period, totalling to a $21.3 million increase in long-term debt, net of cash and bank indebtedness. This increase is mainly related to the 2021 Acquisitions, which accounted for an increase of $83.5 million of long-term debt, partly offset by debt repayments and payments on lease liabilities.

For the first nine-month periods of 2021 and 2020, the business segments performed as follows:

(in thousands of

Canadian dollars)

Janitorial Canada

Janitorial USA

Technical Services

Complementary
Services

Consolidated

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Revenue

392,497

394,118

240,659

247,195

495,408

358,100

46,614

63,463

1,164,147

1,046,942

Organic Growth (Decline)

(0.4%)

(1.8%)

4.8%

(2.2%)

10.1%

(9.3%)

(28.0%)

17.5%

3.2%

(2.3%)

Adjusted EBITDA1

58,620

42,983

23,104

20,192

26,572

9,923

357

8,041

99,236

72,772

Adjusted EBITDA Margin1

14.9%

10.9%

9.6%

8.2%

5.4%

2.8%

0.8%

12.7%

8.5%

7.0%

GDI's Janitorial Canada segment had another strong quarter, recording $132.5 million in revenue while delivering $18.4 million in Adjusted EBITDA1. GDI's Janitorial USA segment also performed well again in Q3 2021, recording revenue of $85.9 million and Adjusted EBITDA1 of $8.1 million, an increase of 13.6% over Q3 2020. Organic growth was negative 2.5% in Canada due to COVID-19 related revenue fluctuations in certain market segments and was positive 7.9% in the USA.

The Technical Services segment is now operating at an almost normal level after recovering from the COVID-19 pandemic effects experienced during 2020, even if some areas of the business remain affected by COVID-19 containment measures. This segment recorded revenue of $179.1 million and Adjusted EBITDA1 of $10.4 million and delivered an Adjusted EBITDA margin1 of 5.8% during the third quarter.

GDI's Complementary services segment recorded an Adjusted EBITDA1 loss of $1.1 million in Q3 2021 which was driven by an inventory provision of $1.4 million taken in the quarter for the ageing of some PPE inventory items. This segment continues to experience lower than normal demand for its core products such as soap, towels and tissue as building occupancy levels remain low, however as occupancy levels begin to rise, we expect to see a rebound in demand for daily consumables in this business segment.

"I am pleased with GDI's performance during Q3 2021," stated Claude Bigras, President & CEO of GDI. "We are encouraged to see COVID case levels stabilizing in almost all of the markets in which we operate, however the threat of the virus remains strong and we are continuing to work closely with our clients to help them navigate through the pandemic. We are expecting a gradual reoccupying of the commercial office market to continue in the Fall with a return to more normal occupancy levels in mid-2022, assuming we do not experience a resurgence of the virus. In the meantime, our Janitorial business segments continue to perform well by providing clients with enhanced cleaning and sanitation services, and our Technical Services business has recovered from the COVID induced slowdown experienced during 2020, with our on-call service business operating at pre-COVID levels and due to its historically high backlog we expect the remainder of the year to be robust. Our Complimentary services segment is still experiencing lower demand given the reduced occupancy in office buildings, and we recorded a one-time inventory write-down at the end of September of $1.4 million. Without that write-down, our consolidated Adjusted EBITDA1 would have been $34.1 million or an Adjusted EBITDA margin1 of 8.4%", stated Mr. Bigras.

______________________


1 The terms "Adjusted EBITDA" and "Adjusted EBITDA Margin" do not have standardized definitions prescribed by International Financial Reporting Standards and therefore, may not be comparable to similar measures presented by other companies. "Adjusted EBITDA" is defined as operating income before depreciation and amortization, Canadian Emergency Wage Subsidy and related expenses, transaction, reorganization and other costs and share-based compensation. The Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by revenues. For more details and for a reconciliation of that measure to the most directly comparable IFRS measure, consult the "Operating and Financial Results" section of the Company's Management Discussion & Analysis (MD&A).

"We are executing well on our growth strategy with the second acquisition in the U.S. market in our Technical Services segment and a platform acquisition in the USA in our products manufacturing division completed during the third quarter. Both these companies are a very strong fit with our culture and values and we are excited to have their teams join our family. Our financial position is very strong, our leverage ratios remain at historic lows, and we are well positioned to continue to execute on our business plan", concluded Mr. Bigras.

ABOUT GDI

GDI is a leading integrated commercial facility services provider which offers a range of services in Canada and the United States to owners and managers of a variety of facility types including office buildings, educational facilities, industrial facilities, healthcare establishments, stadiums and event venues, hotels, shopping centres, distribution facilities, airports and other transportation facilities. GDI's commercial facility services capabilities include commercial janitorial and building maintenance, the installation, maintenance and repair of HVAC-R, mechanical, electrical and building automation systems, as well as other complementary services such as janitorial products manufacturing and distribution. GDI's subordinate voting shares are listed on the Toronto Stock Exchange (TSX: GDI). Additional information on GDI can be found on its website at www.gdi.com.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements in this MD&A may constitute forward-looking information within the meaning of securities laws. Forward looking information may relate to GDI's future outlook and anticipated events, business, operations, financial performance, financial condition or results and, in some cases, can be identified by terminology such as "may"; "will"; "should"; "expect"; "plan"; "anticipate"; "believe"; "intend"; "estimate"; "predict"; "potential"; "continue"; "foresee"; "ensure" or other similar expressions concerning matters that are not historical facts. In particular, statements regarding GDI's future operating results and economic performance and its objectives and strategies are forward-looking statements. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities, which GDI believes are reasonable as of the current date. While management considers these assumptions to be reasonable based on information currently available to the Company, they may prove to be incorrect. It is impossible for GDI to predict with certainty the impact that the current economic uncertainties may have on future results. Forward-looking information is also subject to certain factors, including risks and uncertainties (described in the "Risk Factors" section) that could cause actual results to differ materially from what GDI currently expects. Namely, these factors include risks pertaining to COVID-19 and related pandemic, unsuccessful implementation of the business strategy, inherent operating risks of acquisition activity, failure to integrate, decline in commercial real estate occupancy levels, deterioration in general economic conditions, increase in competition, influence of the principal shareholders, increase in costs which cannot be passed to customers, loss of key or long-term customers, public procurement laws and regulations, legal proceedings, reputational damage, labour disputes, goodwill and long-lived assets impairment charges, labour shortages, tax matters, dependence on key employees, participation in multi-employer pension plans, legislation or other governmental action, disruption in information technology systems, exchange rate fluctuations, disputes with franchisees, public perception of environmental footprint, many of which are beyond the Company's control. Therefore, future events and results may vary significantly from what management currently foresees. The reader should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While management may elect to, the Company is under no obligation and does not undertake to update or alter this information at any particular time, except as may be required by law.

______________________

1 The terms "Adjusted EBITDA" and "Adjusted EBITDA Margin" do not have standardized definitions prescribed by International Financial Reporting Standards and therefore, may not be comparable to similar measures presented by other companies. "Adjusted EBITDA" is defined as operating income before depreciation and amortization, Canadian Emergency Wage Subsidy and related expenses, transaction, reorganization and other costs and share-based compensation. The Adjusted EBITDA Margin is calculated by dividing Adjusted EBITDA by revenues. For more details and for a reconciliation of that measure to the most directly comparable IFRS measure, consult the "Operating and Financial Results" section of the Company's Management Discussion & Analysis (MD&A).

Analyst Conference Call:

November 11, 2021 at 9:00 A.M. (ET)




Kindly note that Investors and Media representatives
may attend as listeners only.




Please use the following dial-in numbers to have
access to the conference call by dialing 10 minutes
before the beginning of the conference:




North America Toll-Free: 1-888-664-6392




Local: 416-764-8659 (Toronto) or 514-225-6995 (Montreal)




Confirmation Code: 44615379




A rebroadcast of the conference call will be available
until November 18, 2021 by dialing:




North America Toll-Free: 1-888-390-0541




Local: 416-764-8677 (Toronto)




Confirmation Code: 615379#

September 30, 2021 unaudited condensed consolidated interim financial statements and accompanied Management & Discussion Analysis are filed on www.sedar.com.

SOURCE GDI Integrated Facility Services Inc.

Cision
Cision

View original content: http://www.newswire.ca/en/releases/archive/November2021/10/c3193.html

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