SNC-Lavalin announces first quarter results for 2013
Net income attributable to the Company's shareholders for the first
quarter of 2013 was $53.6 million ($0.35 per share on a diluted basis),
compared to $66.3 million ($0.44 per share on a diluted basis) for the
first quarter of 2012.
Net income excluding Infrastructure Concession Investments was $18.6
million for the first quarter of 2013, compared to $41.2 million for
the corresponding period in 2012. SNC-Lavalin's net income from
Infrastructure Concession Investments was $35.0 million for the first
quarter of 2013 compared to $25.1 million for the first quarter of
Revenues for the first quarter of 2013 increased by 6.3% to
$1.9 billion, compared to $1.8 billion for the same period in 2012.
Revenue backlog totalled $10.2 billion at the end of March 2013, in line
with the end of December 2012.
The Board of Directors declared a cash dividend of $0.23 per share for
the first quarter of 2013.
N.B.: All amounts indicated are in Canadian dollars.
MONTREAL, May 2, 2013 /CNW Telbec/ -
|SNC-Lavalin Group Inc.|
|Financial Highlights (unaudited)|
|(in thousands of Canadian dollars, unless otherwise indicated)||2013||2012|
|Revenues by activity|
|Operations and Maintenance||382,875||383,361|
|Infrastructure Concession Investments (ICI)||143,288||116,518|
|Net income excluding ICI (1)||$||18,585||$||41,215|
|SNC-Lavalin's net income from ICI||35,038||25,117|
|Net income attributable to SNC-Lavalin shareholders (1)||53,623||66,332|
|Net income attributable to non-controlling interests||77||217|
|Net income (1)||$||53,700||$||66,549|
|Diluted earnings per share ($) (1)||$||0.35||$||0.44|
|Shares outstanding (in thousands)|
|Weighted average number of outstanding shares - Basic||151,233||151,110|
|Weighted average number of outstanding shares - Diluted||151,603||151,662|
|As at||As at|
|March 31||December 31|
|Revenue backlog by activity||2013||2012|
|Operations and Maintenance||2,392,400||2,234,400|
Effective January 1, 2013, the Company has adopted the IAS 19 amendments
with respect to employee benefits.
Accordingly, comparative figures were adjusted to conform to these amendments. See Note 2B to the Company's unaudited interim condensed consolidated financial statements for more details.
SNC-Lavalin Group Inc. (TSX: SNC) announced its results today for the first quarter ended March 31, 2013.
First Quarter Results
For the first quarter of 2013, net income attributable to SNC-Lavalin shareholders was $53.6 million ($0.35 per share on a diluted basis), compared to $66.3 million ($0.44 per share on a diluted basis) for the comparable quarter in 2012.
Net income excluding Infrastructure Concession Investments was $18.6 million, compared to $41.2 million for the first quarter of 2012, mainly reflecting operating losses in the Infrastructure & Environment and Mining & Metallurgy segments, as well as a lower contribution from the Hydrocarbons & Chemicals segment, partially offset by higher contributions from the Power and Operations & Maintenance segments. The operating loss in Infrastructure & Environment is principally due to approximately $32 million recognized in the first quarter of 2013 from additional costs on a major infrastructure project, which the Company believes were not contemplated by the relevant project agreement and for which the Company intends to take steps to recover the value of these additional costs. The operating loss in Mining & Metallurgy is due to provision for costs of approximately $17 million following the receipt of a notice of suspension by the Company in March 2013 in connection with a major mining contract. Net income from ICI increased to $35.0 million, compared to $25.1 million for the quarter ended March 31, 2012, mainly due to higher net income from AltaLink, a higher dividend received from Highway 407 and higher net income from other ICI.
Revenues for the first quarter of 2013 increased by 6.3% to $1.9 billion compared to $1.8 billion in the first quarter of 2012, mainly due to an increase of 16.9% in the Packages category.
Cash and cash equivalents totalled $0.9 billion as at March 31, 2013, compared to $1.2 billion as at December 31, 2012.
Revenue backlog totalled $10.2 billion at the end of March 2013, in line with the end of December 2012.
"Our revenues increased compared to the same quarter last year and we maintained our level of total backlog, but unfortunately we have had to record some provisions on two contracts. We are maintaining our 2013 outlook," said Robert G. Card, President and Chief Executive Officer, SNC-Lavalin Group Inc. "We continue to place an emphasis on ethics, safety, compliance, project execution and globalization. As previously announced, we have also developed the strategic business plan of the Company, and we will be presenting the main elements of it at our Annual General Meeting later this morning. Our desire is to create long-term value for our shareholders."
The Company is maintaining its previously announced 2013 Outlook for which it expects an annual growth in net income of between 10% and 15% in 2013 compared to 2012. This outlook is principally based on (i) the expectations that the Power segment, mainly based on its current backlog, and the ICI segment will be the main contributors to net income, while the Hydrocarbons & Chemicals and Infrastructure & Environment segments will continue to be challenging throughout 2013, and the Mining & Metallurgy segment could be affected by the softening of the commodity markets, (ii) the costs expectations relating to the Company's ongoing commitment to compliance matters and the improvement and strengthening of its processes across the organization and (iii) the assumptions and methodology described in the Company's 2012 Management's Discussion and Analysis under the heading "How We Budget and Forecast Our Results." This 2013 Outlook should be read in conjunction with the "Forward Looking Statements" section below and is subject to the risks and uncertainties summarized therein, which are more fully described in the Company's public disclosure documents.
The Board of Directors today declared a cash dividend of $0.23 per share, payable on May 30, 2013 to shareholders of record on May 16, 2013. This dividend is an "eligible dividend" for income tax purposes.
SNC-Lavalin is one of the leading engineering and construction groups in the world and a major player in the ownership of infrastructure, and in the provision of operations and maintenance services. Founded in 1911, SNC-Lavalin has offices across Canada and in over 40 other countries around the world, and is currently working in some 100 countries. www.snclavalin.com
Reference in this press release, and hereafter, to the "Company" or to "SNC-Lavalin" means, as the context may require, SNC-Lavalin Group Inc. and all or some of its subsidiaries or joint ventures, or SNC-Lavalin Group Inc. or one or more of its subsidiaries or joint ventures.
Statements made in this press release that describe the Company's or management's budgets, estimates, expectations, forecasts, objectives, predictions, projections of the future or strategies may be "forward-looking statements", which can be identified by the use of the conditional or forward-looking terminology such as "aims", "anticipates", "assumes", "believes", "estimates", "expects", "goal", "intends", "may", "plans", "projects", "should", "will", or the negative thereof or other variations thereon. Forward-looking statements also include any other statements that do not refer to historical facts. All such forward-looking statements are made pursuant to the "safe-harbour" provisions of applicable Canadian securities laws. The Company cautions that, by their nature, forward-looking statements involve risks and uncertainties, and that its actual actions and/or results could differ materially from those expressed or implied in such forward-looking statements, or could affect the extent to which a particular projection materializes. Forward-looking statements are presented for the purpose of assisting investors and others in understanding certain key elements of the Company's current objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of the Company's business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes.
The 2013 outlook referred to in this press release is forward-looking information and is based on the methodology described in the Company's 2012 Management's Discussion and Analysis under the heading "How We Budget and Forecast Our Results" and is subject to the risks and uncertainties described in the Company's public disclosure documents. The purpose of the 2013 outlook is to provide the reader with an indication of management's expectations, at the date of this press release, regarding the Company's future financial performance and readers are cautioned that this information may not be appropriate for other purposes.
Forward-looking statements made in this press release are based on a number of assumptions believed by the Company to be reasonable as at the date hereof. The assumptions are set out throughout the Company's 2012 Management's Discussion and Analysis (particularly, in the sections entitled "Critical Accounting Judgments and Key Sources of Estimation Uncertainty" and "How We Analyze and Report our Results" in the Company's 2012 Management's Discussion and Analysis), as updated in the Company's First Quarter 2013 Management's Discussion and Analysis. If these assumptions are inaccurate, the Company's actual results could differ materially from those expressed or implied in such forward-looking statements. In addition, important risk factors could cause the Company's assumptions and estimates to be inaccurate and actual results or events to differ materially from those expressed in or implied by these forward-looking statements. These risks include, but are not limited to: (a) if the Company is not able to successfully execute its new strategic plan, its business and results of operations would be adversely affected; (b) the outcome of pending and future claims and litigation could have a material adverse impact on the Company's business, financial condition and results of operation; (c) the Company is subject to ongoing investigations which could adversely affect its business, results of operations or reputation and which could subject it to sanctions, fines or monetary penalties, some of which may be significant; (d) further regulatory developments could have a significant adverse impact on the Company's results, and employee, agent or partner misconduct or failure to comply with anti-bribery and other government laws and regulations could harm the Company's reputation, reduce its revenues and net income, and subject the Company to criminal and civil enforcement actions; (e) a negative impact on the Company's public image could influence its ability to obtain future projects; (f) fixed-price contracts or the Company's failure to meet contractual schedule or performance requirements may increase the volatility and unpredictability of its revenue and profitability; (g) the Company's revenue and profitability are largely dependent on the awarding of new contracts, which it does not directly control, and the uncertainty of contract award timing could have an adverse effect on the Company's ability to match its workforce size with its contract needs; (h) the Company's backlog is subject to unexpected adjustments and cancellations, including under "termination for convenience" provisions, and does not represent a guarantee of the Company's future revenues or profitability; (i) SNC-Lavalin is a provider of services to government agencies and is exposed to risks associated with government contracting; (j) the Company's international operations are exposed to various risks and uncertainties, including unfavourable political environments, weak foreign economies and the exposure to foreign currency risk; (k) there are risks associated with the Company's ownership interests in ICI that could adversely affect it; (l) the Company is dependent on third parties to complete many of its contracts; (m) the Company's use of joint ventures and partnerships exposes it to risks and uncertainties, many of which are outside of the Company's control; (n) the competitive nature of the markets in which the Company does business could adversely affect it; (o) the Company's project execution activities may result in professional liability or liability for faulty services; (p) the Company could be subject to monetary damages and penalties in connection with professional and engineering reports and opinions that it provides; (q) the Company may not have in place sufficient insurance coverage to satisfy its needs; (r) the Company's employees work on projects that are inherently dangerous and a failure to maintain a safe work site could result in significant losses and/or an inability to obtain future projects; (s) the Company's failure to attract and retain qualified personnel could have an adverse effect on its activities; (t) Work stoppages, union negotiations and other labour matters could adversely affect the Company; (u) the Company relies on information systems and data in its operations. Failure in the availability or security of the Company's information systems or in data security could adversely affect its business and results of operations; (v) any acquisition or other investment may present risks or uncertainties; (w) a deterioration or weakening of the Company's financial position, including its net cash position, would have a material adverse effect on its business and results of operations; * the Company may have significant working capital requirements, which if unfunded could negatively impact its business, financial condition and cash flows; (y) an inability of SNC-Lavalin's clients to fulfill their obligations on a timely basis could adversely affect the Company; (z) the Company may be required to impair certain of its goodwill, and it may also be required to write down or write off the value of certain of its assets and investments, either of which could have a material adverse impact on the Company's results of operations and financial condition; (aa) global economic conditions could affect the Company's client base, partners, subcontractors and suppliers and could materially affect its backlog, revenues, net income and ability to secure and maintain financing; (bb) fluctuations in commodity prices may affect clients' investment decisions and therefore subject the Company to risks of cancellation, delays in existing work, or changes in the timing and funding of new awards, and may affect the costs of the Company's projects; (cc) inherent limitations to the Company's control framework could result in a material misstatement of financial information, and; (dd) environmental laws and regulations expose the Company to certain risks, could increase costs and liabilities and impact demand for the Company's services. The Company cautions that the foregoing list of factors is not exhaustive. For more information on risks and uncertainties, and assumptions that would cause the Company's actual results to differ from current expectations, please refer to the sections "Risks and Uncertainties", "How We Analyze and Report Our Results" and "Critical Accounting Judgments and Key Sources of Estimation Uncertainty" in the Company's 2012 Management's Discussion and Analysis, as updated in the Company's First Quarter 2013 Management's Discussion and Analysis.
The forward-looking statements herein reflect the Company's expectations
as at the date of this press release and are subject to change after
this date. The Company does not undertake any obligation to update
publicly or to revise any such forward-looking statements whether as a
result of new information, future events or otherwise, unless required
by applicable legislation or regulation.
SNC-Lavalin's Consolidated Financial Statements and Management's Discussion and Analysis and other relevant financial materials are available in the Investor Relations section of the Company's website at www.snclavalin.com. These and other Company reports are also available on the website maintained by the Canadian Securities regulators at www.sedar.com.