TERRAVEST ANNOUNCES FIRST QUARTER RESULTS FOR FISCAL 2024 AND DIVIDEND DECLARATION

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TORONTO, Feb. 8, 2024 /CNW/ – TerraVest Industries Inc., (TSX:TVK) (“TerraVest” or the “Company”) announces its results for the first quarter ended December 31, 2023 and the declaration of its quarterly dividend.

FIRST QUARTER REVIEW AND OUTLOOK

Business Performance

Management believes that there are certain non‐IFRS financial measures that can be used to assist shareholders in analyzing the performance of TerraVest. The table below highlights certain financial results and reconciles net income to adjusted earnings before interests, income taxes, depreciation and amortization (“EBITDA”) for the first quarter ended December 31, 2023 and the comparative period in fiscal 2023.

First quarters ended

Dec. 31, 2023

Dec. 31, 2022

$

$

Sales

228,090

177,198

Net Income

19,303

13,086

Add (subtract):

Income tax expense

8,142

4,513

Financing costs

6,417

3,716

Depreciation and amortization

11,125

9,291

Change in fair value of derivative financial instruments

(280)

(1,312)

Change in fair value of investment in equity instruments

573

205

Change in fair value of investment in a limited partnership

403

(Gain) loss on foreign exchange

3,014

753

(Gain) loss on disposal of other property, plant and equipment

332

454

(Gain) loss on disposal of property, plant and equipment for rental

(375)

(567)

(Gain) loss on lease modification

19

Acquisition‑related cost

402

80

Adjusted EBITDA

49,056

30,238

Sales for the first quarter ended December 31, 2023 were $228,090 versus $177,198 for the prior comparable quarter. This represents an increase of 29%. However, TerraVest acquired all the operating assets of the subsidiaries of Highland Tank Holdings, LLC (“HT”) in November 2023 and all of the issued and outstanding shares of LV Energy Services Ltd. and its sister company (together referred as “LV”) effective October 1, 2023, all of which did not contribute to the prior comparable period. Excluding HT and LV, sales for the first quarter ended December 31, 2023 were $189,543 versus $177,198 for the prior comparable quarter representing an increase of 7% for TerraVest’s base portfolio (excluding HT and LV). The increases in sales for the first quarter ended December 31, 2023 are the result of higher demand for oil and gas processing equipment and services in Western Canada, as well as for LPG storage and distribution equipment.

Net income for the first quarter ended December 31, 2023 was $19,303 versus $13,086 for the prior comparable quarter. This represents an increase of 48% which is a result of the positive contributions from HT, LV and from increased sales in TerraVest’s base portfolio of businesses. The increase in net income was partially offset by acquisition-related costs, increased financing costs due to higher debt level to finance business acquisitions and increased interest rates versus the prior period as well as higher income tax expense. Other variances are also highlighted in the table above.

Adjusted EBITDA for the first quarter ended December 31, 2023 was $49,056 versus $30,238 for the prior comparable quarter. This represents an increase of 62%, which is the result of the reasons explained above.

The table below reconciles cash flow from operating activities to Cash Available for Distribution for the first quarter ended December 31, 2023 and the comparative period in fiscal 2023.

First quarters ended     

Dec. 31, 2023

Dec. 31, 2022

$

$

Cash Flow from Operating Activities

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