ATS Reports First Quarter Fiscal 2019 Results

CAMBRIDGE, ON /CNW/ - ATS Automation Tooling Systems Inc. (TSX: ATA) ("ATS" or the "Company") today reported financial results for the three months ended July 1, 2018.

First quarter summary

• Revenues were $300.0 million, 14% higher than a year ago.
• Earnings from operations were $27.0 million (9% operating margin), compared to $21.3 million (8% operating margin) a year ago.
• Adjusted earnings from operations1 were $32.6 million (11% margin), compared to $26.3 million (10% margin) a year ago, primarily reflecting higher revenues and improved gross margin compared to a year ago.
• EBITDA1 was $36.8 million (12% EBITDA margin), compared to $30.2 million (11% EBITDA margin) in the first quarter of fiscal 2018.
• Earnings per share were 18 cents basic and diluted compared to 12 cents basic and diluted a year ago. First quarter adjusted basic earnings per share1 were 22 cents compared to 16 cents a year ago.
• Order Bookings were $358 million, a 35% increase from the first quarter of fiscal 2018.
• Period end Order Backlog was a record $789 million, 16% higher than at July 2, 2017.
• The Company's balance sheet and financial capacity to support growth remained strong, with unutilized credit facilities of $629.5 million.

"Our first quarter performance featured improvements in our financial value drivers including year-over-year growth in Order Bookings, revenues and margin expansion," said Andrew Hider, Chief Executive Officer. "We finished the quarter with record Order Backlog and have continued to advance the ATS Business Model. Our balance sheet is strong and we are well positioned to execute on our value creation strategy: Build, Grow and Expand, to drive long-term shareholder value."

First quarter summary
Fiscal 2019 first quarter revenues were 14% higher than in the corresponding period a year ago. Higher revenues primarily reflected higher Order Backlog entering the first quarter of fiscal 2019 compared to a year ago, and higher Order Bookings in the first quarter. Increased revenues from construction contracts more than offset lower services revenues.

By market, fiscal 2019 first quarter revenues from the consumer products & electronics, and the life sciences markets increased 81% and 5% respectively, due to higher Order Backlog entering the first quarter of fiscal 2019. Revenues in the energy market increased 70%, primarily due to the timing of Order Bookings. Transportation revenues decreased 16% compared to a year ago, primarily due to timing of program execution compared to the previous year.

Fiscal 2019 first quarter earnings from operations were $27.0 million (9% operating margin) compared to $21.3 million (8% operating margin) in the first quarter of fiscal 2018. First quarter fiscal 2019 earnings from operations included $5.6 million related to amortization of identifiable intangible assets recorded on the acquisitions of PA, IWK and sortimat. Included in first quarter fiscal 2018 earnings from operations was $5.0 million related to amortization of identifiable intangible assets recorded on the acquisitions of PA, IWK and sortimat. Excluding these items, first quarter fiscal 2019 adjusted earnings from operations were $32.6 million (11% margin), compared to adjusted earnings from operations of $26.3 million (10% margin) a year ago. Higher adjusted earnings from operations primarily reflected higher revenues and improved gross margin compared to a year ago, partially offset by higher selling, general and administrative expenses in the first quarter of fiscal 2019.

Depreciation and amortization expense was $9.8 million in the first quarter of fiscal 2019, compared to $8.9 million a year ago. The increase primarily reflected higher depreciation expenses for internal development projects and amortization expenses of acquisition-related intangible assets.
EBITDA was $36.8 million (12% EBITDA margin) in the first quarter of fiscal 2019 compared to $30.2 million (11% EBITDA margin) in the first quarter of fiscal 2018. Higher revenues and improved gross margin in the first quarter of fiscal 2019 were partially offset by higher selling, general and administrative expenses compared to a year ago.

Order Bookings
First quarter fiscal 2019 Order Bookings were $358 million, a 35% increase from the first quarter of fiscal 2018 as a result of growth in all customer markets. By customer market, higher Order Bookings in Energy primarily related to new programs in the nuclear market. Order Bookings in transportation are being driven by the electrification of vehicles (EV).  Increased Order Bookings in life sciences are primarily related to medical device programs.  Increased Order Bookings in consumer products and electronics are primarily related to warehousing automation.

Order Backlog
At July 1, 2018, Order Backlog was a record $789 million, 16% higher than at July 2, 2017. Higher Order Backlog was driven primarily by increased Order Bookings in all markets.

Quarterly conference call
ATS' quarterly conference call begins at 10:00 a.m. eastern on Wednesday August 15, 2018, and can be accessed live at www.atsautomation.com or on the phone by dialing (416) 764-8688 five minutes prior to the scheduled start time. A replay of the conference will be available on the ATS website following the call. Alternatively, a telephone recording of the call will be available for one week by dialing (416) 764-8677 and entering passcode 551836 followed by the number sign.

Annual Shareholders' Meeting
The Company will host its annual meeting of shareholders at 10:00 a.m. eastern on Thursday, August 16, 2018 at the TMX Broadcast Centre, The Exchange Tower, 130 King Street West, Toronto Ontario.

Investor Day
The Company will host an Investor Day on Tuesday, September 18, 2018 at its headquarters in Cambridge, Ontario. ATS looks forward to welcoming its institutional investors and equity research analysts for an update on its corporate strategy and facility tour. If you are interested in attending, please contact Sonya Mehan, Director of Investor Relations and Corporate Communications at [email protected].

About ATS
ATS is an industry-leading automation solutions provider to many of the world's most successful companies. ATS uses its extensive knowledge base and global capabilities in custom automation, repeat automation, automation products and value-added services, including pre-automation and after-sales services, to address the sophisticated manufacturing automation systems and service needs of multinational customers in markets such as life sciences, chemicals, consumer products, electronics, food, beverage, transportation, energy, and oil and gas. Founded in 1978, ATS employs approximately 3,800 people at 20 manufacturing facilities and over 50 offices in North America, Europe, Southeast Asia and China. The Company's shares are traded on the Toronto Stock Exchange under the symbol ATA.  Visit the Company's website at www.atsautomation.com.