Superior Plus Corp. Announces 2016 Second Quarter Results
(firmenpresse) - TORONTO, ONTARIO -- (Marketwired) -- 08/09/16 -- Superior Plus Corp. (TSX: SPB) -
Financial Overview
Highlights
Energy Distribution
Specialty Chemicals
Construction Products Distribution
Corporate Related
2016 Financial Outlook
Superior''s 2016 financial outlook of AOCF per share has been updated to $1.40 to $1.60 from $1.50 to $1.80 per share as provided in the second quarter of 2016. The updated 2016 financial outlook is due to the Sale of CPD and a reduced outlook for the Specialty Chemicals business for the third and fourth quarters of 2016. The reduction in the outlook for the Specialty Chemicals business is due to lower than anticipated results in the chlor-alkali and sodium chlorate segments in the second half of 2016.
In addition to the background provided in the individual business financial outlook sections, key assumptions underlying the 2016 financial outlook include:
For additional details on the assumptions underlying the 2016 financial outlook, see Superior''s 2016 Second Quarter MD&A.
Debt Management Update
Superior remains focused on managing both its total debt and its total debt to EBITDA. Superior''s total debt (including convertible debentures) to Compliance EBITDA (before transaction costs) was 3.3X as at June 30, 2016, compared to 3.2X at December 31, 2015. Superior anticipates a total debt to EBITDA ratio in the range of 1.8X to 2.2X at December 31, 2016 as the proceeds from the Sale of CPD will be used to reduce indebtedness. For additional details on the anticipated debt as at December 31, 2016, see the "Debt Management Summary" in the MD&A.
MD&A and Financial Statements
Superior''s MD&A, the unaudited Consolidated Financial Statements and the Notes to the Consolidated Financial Statements for the three and six months ended June 30, 2016, are available online at Superior''s website at under the Investor Relations section and on .
2016 Second Quarter Conference Call
Superior will be conducting a conference call and webcast for investors, analysts, brokers and media representatives to discuss the 2016 Second Quarter Results at 10:30 a.m. EST on Wednesday, August 10, 2016. To participate in the call, dial: 1-866-223-7781. An archived recording of the call will be available for replay until midnight, September 10, 2016. To access the recording, dial: 1-800-408-3053 and enter pass code 4700400. Internet users can listen to the call live, or as an archived call, on Superior''s website at under the Events section.
Non-GAAP Financial Measures
Throughout the second quarter earnings release, Superior has used the following terms that are not defined by GAAP, but are used by management to evaluate the performance of Superior and its business. Since non-GAAP financial measures do not have standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies, securities regulations require that non-GAAP financial measures be clearly defined, qualified and reconciled to their nearest GAAP financial measures. Except as otherwise indicated, these Non-GAAP financial measures are calculated and disclosed on a consistent basis from period to period. Specific adjusting items may only be relevant in certain periods.
The intent of non-GAAP financial measures is to provide additional useful information to investors and analysts. The measures do not have any standardized meaning under IFRS. The measures should not, therefore, be considered in isolation or used in substitute for measures of performance prepared in accordance with IFRS. Other issuers may calculate non-GAAP financial measures differently.
Investors should be cautioned that EBITDA, EBITDA from operations, compliance EBITDA and AOCF should not be construed as alternatives to net earnings, cash flow from operating activities or other measures of financial results determined in accordance with GAAP as an indicator of Superior''s performance.
Non-GAAP financial measures are identified and defined as follows:
Adjusted Operating Cash Flow
AOCF is equal to cash flow from operating activities as defined by IFRS, adjusted for changes in non-cash working capital, other expenses, non-cash interest expense, current income taxes and finance costs. Superior may deduct or include additional items in its calculation of AOCF; these items would generally, but not necessarily, be items of a non-recurring nature. AOCF is the main performance measure used by management and investors to evaluate Superior''s performance. AOCF represents cash flow generated by Superior that is available for, but not necessarily limited to, changes in working capital requirements, investing activities and financing activities of Superior.
The seasonality of Superior''s individual quarterly results must be assessed in the context of annualized AOCF. Adjustments recorded by Superior as part of its calculation of AOCF include, but are not limited to, the impact of the seasonality of Superior''s businesses, principally the Energy Distribution segment, by adjusting for non-cash working capital items, thereby eliminating the impact of the timing between the recognition and collection/payment of Superior''s revenues and expenses, which can differ significantly from quarter to quarter. Adjustments are also made to reclassify the cash flow related to natural gas and electricity customer contract-related costs in a manner consistent with the income statement''s recognition of these costs.
EBITDA
EBITDA represents earnings before taxes, depreciation, amortization, finance expense, and certain other non-cash expenses, and is used by Superior to assess its consolidated results and those of its operating segments. The EBITDA of Superior''s operating segments may be referred to as EBITDA from operations.
EBITDA from Operations
EBITDA from operations is defined as EBITDA excluding gains/(losses) on foreign currency hedging contracts. For purposes of this MD&A, foreign currency hedging contract gains and losses are excluded from the results of the operating segments. Comparative figures for the prior periods have been reclassified to reflect this change.
Compliance EBITDA
Compliance EBITDA represents earnings before interest, taxes, depreciation, amortization and certain other non-cash expenses calculated on a 12-month trailing basis, giving pro forma effect to acquisitions and divestitures, and is used by Superior to calculate compliance with its debt covenants and other credit information. See Note 15 to the unaudited condensed consolidated financial statements for a reconciliation of net earnings to compliance EBITDA.
Payout Ratio
Payout ratio represents dividends as a percentage of AOCF less maintenance capital expenditures, CRA and other tax payments and capital lease repayments and is used by Superior to assess its financial results and leverage. Payout ratio is not a defined performance measure under GAAP. Superior''s calculation of payout ratio may differ from similar calculations used by comparable entities.
Reconciliation of Net Earnings Before Income Taxes to EBITDA from Operations(1)(2)
Forward-Looking Information
Certain information included herein is forward-looking information within the meaning of applicable Canadian securities laws. Forward-looking information may include statements regarding the objectives, business strategies to achieve those objectives, expected financial results (including those in the area of risk management), economic or market conditions, and the outlook of or involving Superior, Superior LP and its businesses. Such information is typically identified by words such as "anticipate", "believe", "continue", "estimate", "expect", "plan", "forecast", "future", "outlook, "guidance", "may", "project", "should", "strategy", "target", "will" or similar expressions suggesting future outcomes.
Forward-looking information in this document includes: future financial position, consolidated and business segment outlooks, expected EBITDA from operations, expected AOCF and AOCF per share, expected leverage ratios and debt repayment, expectations in terms of the cost of operations, business strategy and objectives, development plans and programs, business expansion and cost structure and other improvement projects, expected product margins and sales volumes, market conditions in Canada and the U.S., continued improvements in operational efficiencies and sales and marketing initiatives in Energy Distribution, impact on results and leverage from the Sale of CPD, proceeds from the Sale of CPD expected to be used initially to repay indebtedness under Superior''s credit facility and to redeem the $150.0 million outstanding principal amount of its 6.00% Debentures due June 30, 2018, future economic conditions, future exchange rates, exposure to such rates and incremental earnings associated with such rates, expected weather, expectations in respect to the global economic environment, our trading strategy and the risk involved in these strategies, the impact of certain hedges on future reported earnings and cash flows, commodity prices and costs, the impact of contracts for commodities, demand for propane, heating oil and similar products, demand for chemicals including sodium chlorate and chlor-alkali, effect of operational and technological improvements, anticipated costs and benefits of business enterprise system upgrade plans, CPD IT one-time integration costs, Canexus transaction costs, future working capital levels, expected governmental regulatory regimes and legislation and their expected impact on regulatory and legislative compliance costs, expectations for the outcome of existing or potential legal and contractual claims, our ability to obtain financing on acceptable terms, expected life of facilities and statements regarding net working capital and capital expenditure requirements of Superior or Superior Plus LP.
Forward-looking information is provided for the purpose of providing information about management''s expectations and plans about the future and may not be appropriate for other purposes. Forward-looking information herein is based on various assumptions and expectations that Superior believes are reasonable in the circumstances. No assurance can be given that these assumptions and expectations will prove to be correct. Those assumptions and expectations are based on information currently available to Superior, including information obtained from third party industry analysts and other third party sources, and the historic performance of Superior''s businesses. Such assumptions include anticipated financial performance, current business and economic trends, the amount of future dividends paid by Superior, business prospects, availability and utilization of tax basis, regulatory developments, currency, exchange and interest rates, trading data, cost estimates, our ability to obtain financing on acceptable terms, the assumptions set forth under the "Financial Outlook" sections of our Second Quarter MD&A and are subject to the risks and uncertainties set forth below.
By its very nature, forward-looking information involves numerous assumptions, risks and uncertainties, both general and specific. Should one or more of these risks and uncertainties materialize or should underlying assumptions prove incorrect, as many important factors are beyond our control, Superior''s or Superior LP''s actual performance and financial results may vary materially from those estimates and intentions contemplated, expressed or implied in the forward-looking information. These risks and uncertainties include incorrect assessments of value when making acquisitions, increases in debt service charges, the loss of key personnel, fluctuations in foreign currency and exchange rates, inadequate insurance coverage, liability for cash taxes, counterparty risk, compliance with environmental laws and regulations, reduced customer demand, operational risks involving our facilities, force majeure, labour relations matters, our ability to access external sources of debt and equity capital, and the risks identified in (i) our Second Quarter MD&A under the heading "Risk Factors" and (ii) Superior''s most recent Annual Information Form. The preceding list of assumptions, risks and uncertainties is not exhaustive.
When relying on our forward-looking information to make decisions with respect to Superior, investors and others should carefully consider the preceding factors, other uncertainties and potential events. Any forward-looking information is provided as of the date of this document and, except as required by law, neither Superior nor Superior LP undertakes to update or revise such information to reflect new information, subsequent or otherwise. For the reasons set forth above, investors should not place undue reliance on forward-looking information.
For more information about Superior, visit our website at .
Contacts:
Beth Summers
Vice-President and Chief Financial Officer
(416) 340-6015
Rob Dorran
Vice-President, Investor Relations and Treasurer
(416) 340-6003
Toll Free: 1-866-490-PLUS (7587)
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Datum: 09.08.2016 - 17:17 Uhr
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