NANAIMO, BC, Aug. 29, 2023 /CNW/ - Atlas Engineered Products ("AEP" or the "Company") (TSXV: AEP) (OTC Markets: APEUF) is pleased to announce its financial and operating results for the three and six months ended June 30, 2023. All amounts are presented in Canadian dollars.
"I continue to be proud of the AEP team that produced another solid quarter, with relatively stable margins in spite of reduced material prices, continued interest rate hikes causing downward momentum in the construction sector, and a overall more competitive market," said Hadi Abassi, the Company's CEO, President and Founder. "We continue to work hard to ensure the Company is moving forward with organic and acquisitive growth. We continue to believe that there is an ongoing need for more housing in Canada and we strive to be the partner of choice for contractors and homeowners during their construction projects."
Financial Highlights for Q2 2023:
SELECTED FINANCIAL RESULTS
Three Months Ended
Six Months Ended
Revenue from the Business
Cost of Sales
Gross Margin %
Net Income After Adjustments and Taxes
Adjusted EBITDA Margin %
Normalized EBITDA Margin %
Weighted Average Number of Shares, Basic
Adjusted EBITDA per Share ($ per share)
Income per Share, Basic ($ per share)
Income per Share, Fully Diluted ($ per share)
Selected Financial Information as at:
Total Non-Current Liabilities
Subsequent Event to Q2 2023:
On August 23, 2023, the Company acquired LCF located in New Brunswick, Canada. LCF is a manufacturer of roof trusses, floor systems, and wall panels and a supplier of engineered wood products. The acquisition of LCF aligns with the Company's strategic acquisition plan and expands the Company's geographical reach while also significantly growing AEP's wall panel manufacturing expertise and capacity.
Outlook for 2023:
The Company is continuing to operate in a more competitive market during 2023 as interest rates have risen in an effort to slow inflation. The Company currently anticipates that increased interest rates will have a minimal overall affect on the housing market after the initial impact of the increase is absorbed by the market. The number of homes that are needed to support Canada's continued population growth and immigration continues to be significant. The Company will continue to monitor the effects of interest rates on the housing market, and is prepared to manage pricing and explore new markets in order to continue to drive organic growth as much as possible during fiscal 2023.
Reduced raw material costs, such as lumber, continue to impact the Company's revenues. These costs are passed along directly to the customer and will result in decreased sales prices to the customer as input costs decrease. Average lumber prices have decreased by roughly 57% for the three months ended June 30, 2023 compared to the three months ended June 30, 2022.
The Company's large order announced on March 9, 2023 was delayed in Quarter 1. A small part of this order was delivered in June of 2023, with the majority expected to be delivered in Quarter 3 and 4, 2023. Permit and construction delays have caused postponements in these deliveries that were outside the Company's control.
The recent acquisition of LCF is a great addition to the AEP group and acquisitions remains a key part of AEP's long term strategic goals. The Company has built a strong pipeline of M&A opportunities and will continue to assess more M&A opportunities that fit within the Company's goals and strategies, while also working to bring in the latest automation to improve operational efficiencies, and adding new products and services to better serve our customers.
Non-GAAP / Non-IFRS Financial Measures
Certain financial measures in this news release do not have any standardized meaning under IFRS and, therefore are considered non-IFRS or non-GAAP measures. These non-IFRS measures are used by management to facilitate the analysis and comparison of period-to-period operating results for AEP and to assess whether AEP's operations are generating sufficient operating cash flow to fund working capital needs and to fund capital expenditures. As these non-IFRS measures do not have any standardized meaning under IFRS, these measures may not be comparable to similar measures presented by other issuers. The non-IFRS measures used in this news release may include "EBITDA", "EBITDA margin", "adjusted EBITDA", "adjusted EBITDA margin", "normalized EBITDA" and "normalized EBITDA margin". For a description of the composition of these measures, please refer to AEP's Management's Discussion and Analysis for the period ended June 30, 2023 under "Non-IFRS / Non-GAAP Financial Measures", available on AEP's website at www.atlasengineeredproducts.com or on SEDAR at www.sedar.com.
About Atlas Engineered Products Ltd.
AEP is a growth company that is acquiring and operating profitable, well-established operations in Canada's truss and engineered products industry. We have a well-defined and disciplined acquisition and operating growth strategy enabling us to scale aggressively and apply new technologies, giving us a unique opportunity to consolidate a fragmented industry of independent operators.
FORWARD LOOKING INFORMATION
Information set forth in this news release contains forward-looking statements. These statements reflect management's current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. Although AEP believes that the expectations reflected in the forward looking statements are reasonable, there is no assurance that such expectations will prove to be correct, or that such future events will occur in the disclosed time frames or at all. AEP cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond AEP's control. Such factors include, among other things: Risks and uncertainties relating to AEP, including those to be described in the Management's Discussion and Analysis ("MD&A") for AEP's three and six months ended June 30, 2023. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, AEP undertakes no obligation to publicly update or revise forward-looking information.
SELECTED FINANCIAL INFORMATION
Except as noted below, the financial information provided in this news release is derived from the AEP's audited financial statements for the three and six months ended June 30, 2023 and the related notes thereto as prepared in accordance with International Financial Reporting Standards ("IFRS") and related IFRS Interpretations Committee ("IFRICs") as issued by the International Accounting Standards Board ("IASB"). A copy of AEP's financial statements for the three and six months ended June 30, 2023 and the related Management's Discussion and Analysis is available on AEP's website at www.atlasengineeredproducts.com or on SEDAR at www.sedar.com.
Financial information for AEP's acquisitions are included in AEP's unaudited financial statements from the date of acquisition. Financial information for acquired businesses for periods prior to the date of acquisition were prepared by management and have not been reviewed or audited by independent auditors.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
SOURCE Atlas Engineered Products Ltd.
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