May 10, 2017 - 7:00 AM EDT
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NAPEC Inc. Reports Results for the First Quarter of 2017

Strong Increase in Revenues and Profitability

DRUMMONDVILLE, QUEBEC--(Marketwired - May 10, 2017) - NAPEC Inc. ("NAPEC" or "the Corporation") (TSX:NPC) reported its results today for the first quarter ended March 31, 2017. All amounts are in Canadian dollars unless otherwise indicated.

Financial highlights Three months ended March 31,  
(in thousands of dollars, except the number of shares and per-share data) 2017 2016  
Revenues 109,350 92,633  
EBITDA1 8,823 6,565  
Net earnings (loss) 594 (376 )
  Per share - basic and diluted ($) 0.01 0.00  
Weighted average number of outstanding shares (basic, in thousands) 103,923 79,866  
(1) Not an IFRS measure. See "Non-IFRS Measure" below for a reconciliation.

"NAPEC posted a strong increase in business volume and profitability in the first quarter of 2017. Revenue growth was robust in the United States as a result of our increased presence in services related to natural gas networks following the acquisition of PCT Contracting LLC ("PCT") on November 30, 2016, and strong activity in most of our major markets. Our increased profitability also reflects our strategy of placing greater emphasis on higher value-added services," said Pierre L. Gauthier, President and Chief Executive Officer of NAPEC.


Revenues for the first quarter of 2017 were $109.4 million, up 18.0% from $92.6 million a year earlier. The increase reflects the addition of PCT's activities in the construction, maintenance and repair of natural gas networks, which represented revenues of $12.0 million in the first quarter of 2017. In addition, revenues from contracts for the construction, maintenance and repair of electricity distribution lines, as well as from contracts for electricity projects for industrial, commercial and institutional customers increased. The currency conversion effect resulting from fluctuations in the value of the Canadian dollar reduced the value of U.S.-dollar-denominated revenues by approximately $3.6 million in the first quarter of 2017, compared to the same period in 2016.

Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the first quarter of 2017 amounted to $8.8 million or 8.1% of revenues, compared to $6.6 million or 7.1% of revenues in the first quarter of 2016. The increase in monetary terms was mainly due to higher business activity, while the increase as a percentage of revenues reflected lower selling, general and administrative expenses as a percentage of revenues, and a foreign exchange loss of $1.3 million in the first quarter of 2016.

NAPEC concluded the first quarter of 2017 with net earnings of $594,000 or $0.01 per share, basic and diluted, compared to a net loss of $376,000 or $0.00 per share, basic and diluted, a year earlier.

As at March 31, 2017, NAPEC had a backlog of $563 million, up from $467 million as at March 31, 2016. The value as at March 31, 2017 includes contracts worth close to $60.0 million that were disclosed on April 12, 2017 by way of a press release.


As at March 31, 2017, long-term debt including the current portion was $94.1 million versus $98.0 million three months earlier. The decrease mainly reflects the repayment of $4.0 million in long-term debt in the first quarter of 2017. As a result, the long-term debt to equity ratio was 0.77 as at March 31, 2017, down from 0.80 three months earlier.

As at March 31, 2017, the Corporation had a cash balance of $13.0 million and an amount of $34.3 million was available on its $50.0 million authorized renewable credit facility. It should be noted that subsequent to the end of the quarter, in April 2017, NAPEC received a $6.0 million payment resulting from the settlement of litigation reached in March 2017.


"The first quarter results underscore the strong demand for our services in most of our markets. In addition, revenues from certain activities are generally higher during the summer quarters, particularly in the gas sector and road matting services. Given these factors and the acquisition of PCT, NAPEC remains confident to see revenue growth in fiscal 2017. We are continuing the process of integrating the businesses acquired over the past two years to foster cross-selling across our network and increase the scope of our high value-added services," concluded Mr. Gauthier.


NAPEC will hold a conference call to discuss its results on Wednesday, May 10, 2017 beginning at 10:00 a.m. Eastern Time. Interested parties can join the call by dialling 647-788-4922 (from Toronto and overseas) or 1-877-223-4471 (from elsewhere in North America). Those unable to participate can listen to a recording by dialling 1-800-585-8367 and entering the code 4720566 on the telephone keypad. The recording will be available from 1:00 p.m. on Wednesday, May 10, 2017 until 11:59 p.m. on Wednesday, May 17, 2017.

Those interested in participating in the webcast with presentation should click on this link:


EBITDA is a measure that has no standardized meaning under IFRS and is therefore considered a non-IFRS measure. As a result, this measure may not be comparable to similar measures presented by other companies. This measure is presented and described in this press release in order to provide additional information regarding the Corporation's liquidity and its ability to generate funds to finance its operations.

The following table is a reconciliation of EBITDA as used by the Corporation to reported net earnings (loss).

Reconciliation of EBITDA to net earnings (loss) Three months ended March 31  
(in thousands of dollars) 2017 2016  
Net earnings (loss) for the period 594 (376 )
  Finance charges 1,603 1,375  
  Income tax expense (recovery) 565 (227 )
  Depreciation and amortization 6,061 5,793  
EBITDA 8,823 6,565  


This document contains forward-looking statements that reflect management's current expectations regarding future events. Forward-looking statements are based on a number of factors and include risks and uncertainties. Actual results may differ from forecast results. Management assumes no obligation beyond what is required under the law to update or revise forward-looking statements pursuant to new information or future events.


NAPEC is a company operating in the energy sector. The Corporation is a leading provider of construction and maintenance services to the public utility and heavy industrial markets, mainly in Quebec, Ontario and the eastern United States. NAPEC and its subsidiaries build and maintain electrical transmission and distribution systems, solar panel farms and natural gas networks. The Corporation also installs gas-powered and electric-powered heavy equipment for utilities, gas-fired industrial power plants and petrochemical facilities in North America. The Corporation also offers environmental construction and road matting services.

Additional information on NAPEC can be found in the SEDAR database ( and on the Corporation's website, at


Pierre L. Gauthier
President and Chief Executive Officer
[email protected]

Mario Trahan, CPA, CMA
Chief Financial Officer
[email protected]

Martin Goulet, CFA
[email protected]

Source: Marketwired (May 10, 2017 - 7:00 AM EDT)

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