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

Posted on: August 09, 2021
  • Q2 2021 revenue of $372.2 million – an increase $45.5 million, or 13.9%, over Q2 2020.
  • Q2 2021 Adjusted EBITDA1 of $33.0 million – an increase of $10.5 million, or 46.4%, over Q2 2020.
  • Q2 2021 net income of $14.0 million or $0.61 per share compared with $13.5 million or $0.63 per share in the second quarter of 2020.
  • Excluding The BPAC Group Inc. acquisition, long-term debt, net of cash and bank indebtedness, decreased by $53.4 million between December 31, 2020 and June 30, 2021.

LASALLE, QC, Aug. 9, 2021 /CNW Telbec/ – GDI Integrated Facility Services Inc. (“GDI” or the “Company“) (TSX: GDI) is pleased to announce its financial results for its second quarter ended June 30, 2021.

For the second quarter of 2021:

  • Revenue was $372.2 million, an increase of $45.5 million, or 13.9%, over the second quarter of 2020. Organic revenue growth was 7.8% and growth from acquisitions was 9.3%, which were partially offset by a negative exchange rate effect of 3.2%.

  • Adjusted EBITDA1 amounted to $33.0 million, an increase of $10.5 million, or 46.4%, over the second quarter of 2020.

  • Net income was $14.0 million or $0.61 per share compared to $13.5 million or $0.63 per share in Q2 2020.

  • Long-term debt decreased from $189.6 million on March 31, 2021 to $177.0 million on June 30, 2021, a decline of $12.6 million, while cash, net of bank indebtedness, also decreased by $2.5 million over the same period, totalling $10.1 million of reduction in long-term debt, net of cash and bank indebtedness.

For the second 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

126,116

118,956

74,899

80,359

160,035

107,362

14,668

25,233

372,190

326,732

Organic Growth (Decline)

6.0%

(11.0%)

4.6%

(5.8%)

22.0%

(22.6%)

(41.9%)

34.2%

7.8%

(9.8%)

Adjusted EBITDA1

18,236

15,165

7,231

6,884

9,869

84

577

4,289

33,013

22,544

Adjusted EBITDA Margin1

14.5%

12.7%

9.7%

8.6%

6.2%

0.1%

3.9%

17.0%

8.9%

6.9%

 

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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 six-month period ended June 30, 2021:

  • Revenue reached $755.8 million, an increase of $74.2 million, or 10.9%, over the corresponding period of 2020. Organic revenue growth was 3.4% and growth from acquisitions was 9.9%, which were partially offset by a negative exchange rate effect of 2.4%.

  • Adjusted EBITDA1 amounted to $66.5 million, an increase of $23.9 million, or 56.2%, over the corresponding period of 2020.

  • Net income was $27.0 million or $1.18 per share compared to $17.8 million or $0.83 per share in the corresponding period if 2020.

  • Long-term debt increased by $8.3 million from $168.7 million on December 31, 2020 to $177.0 million on June 30, 2021 while cash, net of bank indebtedness, also increased by $21.4 million over the same period, totalling $13.1 million of reduction in long-term debt, net of cash and bank indebtedness. Excluding the BPAC Group Inc. acquisition, long–term debt, net of cash and bank indebtedness, decreased by $53.4 million.

For the first two 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

259,969

258,149

154,750

163,479

316,277

229,037

31,817

41,870

755,791

681,584

Organic Growth (Decline)

0.7%

(3.4%)

3.3%

(2.2%)

9.6%

(8.8%)

(24.0%)

15.3%

3.4%

(3.0%)

Adjusted EBITDA1

40,248

24,548

14,962

13,025

16,183

4,769

1,423

5,688

66,516

42,581

Adjusted EBITDA Margin1

15.5%

9.5%

9.7%

8.0%

5.1%

2.1%

4.5%

13.6%

8.8%

6.2%

GDI’s Janitorial Canada segment had a strong second quarter, recording $126.1 million in revenue representing an organic growth of 6.0%, while delivering $18.2 million in Adjusted EBITDA1, an increase of 20.3% over Q2 2020. GDI’s Janitorial USA segment also performed well in Q2 2021, recording revenue of $74.9 million representing organic growth of 4.6% and Adjusted EBITDA1 of $7.2 million, an increase of 5.0% over Q2 2020. The Janitorial Canada and Janitorial USA segments are continuing to perform well with many clients requiring enhanced recurring services and specialty services due to the COVID-19. We see this trend continuing in our cleaning businesses until the COVID-19 virus becomes less of a threat within society.

The Technical Services segment performed extremely well during Q2 2021, recording Adjusted EBITDA1 of $9.9 million, representing an Adjusted EBITDA margin1 of 6.2%. This segment was greatly affected in the second quarter of 2020 by the complete shut-down of operations in most markets in response to the COVID-19 pandemic outbreak, which limited its Adjusted EBITDA1 to $0.1 million and Adjusted EBITDA margin1 to 0.1%.

GDI’s Complementary services segment recorded a decrease in Adjusted EBITDA1 and Adjusted EBITDA margin1 in Q2 2021 as compared to the prior year. While this segment continued to experience demand for personal protective equipment, it is however at a lesser level compared with Q2 2020 where demand was abnormally high in response to the COVID-19 pandemic outbreak. This segment is currently operating in a more balanced supply/demand environment for COVID-related products than was experienced at the onset of the pandemic and remains affected by significantly low occupancy rates during the second quarter of 2021 as it experienced a decrease in demand for day-to-day cleaning supplies such as soaps, towels and tissues. As occupancy levels begin to rise, we expect to see a rebound in demand for daily consumables in this business segment.

__________________________

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).

“I am very pleased with GDI’s performance during Q2 2021,” stated Claude Bigras, President & CEO of GDI. “While we experienced declining COVID infection rates and the beginning of gradual regional economic reopenings in the U.S. and Canada during Q2, the threat of the virus remains but has a positive effect on our janitorial business. We are working closely with our clients to help them develop reoccupying plans to ensure that their facilities are safe environments for occupants to return to. There continues to be a significant amount of uncertainty around the path the virus will take, with recent increases in case count numbers in certain Provinces and States driven by the Delta variant, and we continue to believe that as long as COVID-19 remains a risk to our society our Janitorial business segments will perform well as our clients look to GDI for expertise and enhanced support to keep their facilities safe. At present, many of our commercial office clients are planning to reoccupy their offices in the fall of 2021, and we are prepared to be there to support them through our enhanced cleaning service offerings. Ainsworth, our Technical Services segment has recovered nicely from the wide-spread pandemic shutdowns experienced in Q2 2020. Our on-call service business is operating at pre-pandemic levels, our project business has resumed, and we are actively engaging in discussions with clients on technologies and solutions to implement enhanced air quality within their facilities. We have a record backlog in our Technical Services segment and are expecting the second half of the year to be robust. Finally, our Complementary Services segment faced some continued challenges during the second quarter as building occupancy was quite low, but as buildings begin to reoccupy we are well positioned for better performance in the upcoming quarters,” added Mr. Bigras.

“After more than 16-months operating in pandemic mode, GDI has proven to be resilient and capable of providing strong operational performance, even in a challenging and uncertain environment. Due to the exceptional performance GDI has delivered since the beginning of the pandemic, our balance sheet is stronger than it has ever been, our leverage ratios are at all-time lows, and we are in a solid financial position. We continue to focus on our growth through acquisition strategy and our financial strength will enable us to capitalize on strategic opportunities as they arise,” 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.

_________________________________

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).

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

Certain statements in this press release 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. 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.

Analyst Conference Call:

August 10, 2021 at 9:00 A.M. (ET)




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June 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.

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