North American Construction Group Ltd. Announces Results for the Fourth Quarter and Year Ended December 31, 2023
North American Construction Group Ltd. (NACG) announced its fourth-quarter and year-end results for 2023, highlighting the successful closure of the MacKellar Group acquisition, strong revenue growth, and record-setting figures. The company reported a combined revenue of $403.4 million, a company quarterly record, driven by the transformative acquisition of MacKellar. Adjusted EBITDA reached $101.1 million, also a company record, with a margin of 25.1%. Despite positive results, the company faced challenges with project losses impacting margins and increased debt levels. NACG's President and CEO, Joseph Lambert, expressed optimism for 2024, emphasizing geographic diversification and operational excellence.
Positive
Successful closure of the MacKellar Group acquisition.
Record combined revenue of $403.4 million for the fourth quarter.
Adjusted EBITDA of $101.1 million, a company record, with a margin of 25.1%.
Challenges with project losses impacting margins and increased debt levels.
Positive outlook for 2024 focusing on geographic diversification and operational excellence.
Negative
Margins impacted by project losses from the Nuna Group of Companies.
Net debt increased to $720.9 million at December 31, 2023, from debt-funded acquisitions and spending.
General and administrative expenses increased due to one-time costs related to the MacKellar acquisition.
The acquisition of the MacKellar Group by North American Construction Group Ltd. (NACG) represents a significant strategic move, indicating a strong push towards geographical diversification and increased market presence in Australia. The acquisition, valued at $369.7 million net of cash acquired, coupled with growth capital spending of $35.9 million, is noteworthy as it was fully funded through senior and vendor-provided debt. This financing approach may raise concerns regarding the company's leverage and its ability to service this debt, especially given the increase in net debt to $720.9 million at year-end 2023.
The reported record revenues of $403.4 million for the quarter, which include three months of operations from MacKellar, suggest that the acquisition is already contributing significantly to the top line. However, investors should be cautious about the impact of integration costs and the sustainability of MacKellar's gross profit margin of 23.7% in the quarter. The reported increase in general and administrative expenses, including one-time acquisition costs and the uptick in interest expense due to higher debt levels are factors that could affect net income in the short term.
It is also important to consider the company's liquidity position, which appears robust with total available capital liquidity of $292.6 million. This liquidity, together with the strong free cash flow of $110.6 million for the quarter, may provide some reassurance to investors regarding the company's financial health and its ability to manage its increased debt load. The forward-looking statements projecting key measures for 2024, including a significant rise in adjusted EBITDA to $430 - $470 million, suggest management's confidence in the company's growth trajectory.
From a market perspective, NACG's aggressive expansion into the Australian market through the MacKellar acquisition could be seen as a strategic move to capitalize on the region's construction and mining sectors. This diversification could protect the company against regional downturns in North America and provide access to new revenue streams. However, the success of this expansion will depend on NACG's ability to integrate MacKellar's operations seamlessly and realize the anticipated synergies.
Investors should also note the company's focus on operational excellence and the restructuring initiative within the Nuna Group of Companies, which is expected to enhance project execution and potentially improve margins. The emphasis on safety, execution and operational excellence are positive indicators of the company's commitment to sustainable growth. Moreover, the strategic focus on diversification and sustainability aligns with broader industry trends, which could enhance the company's competitive position and appeal to socially conscious investors.
Given the cyclical nature of the construction and mining industries, the company's performance will be influenced by commodity prices, economic conditions and competition. As such, while the current outlook appears positive, investors should monitor these external factors closely as they can significantly impact the company's financial performance.
It is crucial to examine the implications of NACG's financial strategy from a legal and regulatory standpoint. The financing of the MacKellar acquisition through debt raises questions about compliance with debt covenants and the company's long-term financial stability. Investors should be aware of the terms of the credit facility agreement and any potential risks associated with the company's increased leverage. The change in presentation of finance lease obligations within the consolidated balance sheets, now included in long-term debt, should also be scrutinized to ensure transparency and adherence to US GAAP principles.
Furthermore, with the upcoming adoption of new FASB standards, such as ASU 2023-05 and ASU 2023-07, NACG will need to assess and potentially adjust its accounting practices. This could lead to changes in how joint venture formations and segment reporting are handled in the future, impacting the presentation of financial statements and the disclosures provided to investors.
03/13/2024 - 05:05 PM
ACHESON, Alberta, March 13, 2024 (GLOBE NEWSWIRE) -- North American Construction Group Ltd. ("NACG") (TSX:NOA/NYSE:NOA) today announced results for the fourth quarter and year ended December 31, 2023. Unless otherwise indicated, figures are expressed in Canadian dollars with comparisons to prior periods ended December 31, 2022.
Fourth Quarter 2023 Highlights:
Closure of the MacKellar Group ("MacKellar") acquisition on October 1, 2023, a seamless change in control, and three months of strong equipment utilization provided a full quarter of operating results in Australia, and a step change in geographic diversification. The allocated purchase price of MacKellar was $369.7 million , net of cash acquired, along with growth capital spending of $35.9 million incurred in the quarter was fully funded with senior and vendor-provided debt and establishes a strong platform for opportunities in Australia. Combined revenue of $403.4 million is a company quarterly record based on the transformative acquisition of MacKellar. Revenue of $326.3 million , compared to $233.4 million in the same period last year, includes this step-change increase along with steady and consistent operations in the Fort McMurray region. Our net share of revenue from equity consolidated joint ventures was $77.1 million , compared to $86.7 million in the same period last year. Quarter-over-quarter increases at the Fargo-Moorhead project were offset by the successful 2023 Q3 completion of the construction project at the gold mine in Northern Ontario. Adjusted EBITDA of $101.1 million , also a company record, and EBITDA margin of 25.1% compared to the prior period metrics of $85.9 million and 26.8% , respectively. Margins were impacted by project losses posted by the Nuna Group of Companies; restructuring efforts are well underway to resolve temporary challenges. Cash flows generated from operating activities of $160.9 million in the quarter, compared to $78.1 million in the prior year quarter, resulting from higher earnings and changes in working capital balances when comparing to the same period in the prior year. Free cash flow ("FCF") of $110.6 million in the quarter was the result of strong revenues, steady and consistent margins, modest capital spending, and positive changes in working capital balances. Net debt was $720.9 million at December 31, 2023, an increase of $325.6 million from September 30, 2023, resulting from the debt-funded purchase price and growth spending in Australia offset by free cash flow directed to debt reduction during the quarter. NACG President and CEO, Joseph Lambert, commented: "The acquisition of the MacKellar Group is a milestone moment for our company and I'd like to thank all the employees for the hard work that has been put in to make these first few months in Australia such a success. In both Queensland and Western Australia, we are excited by the many prospects we have in front of us and look forward to sharing best practices and in-house maintenance expertise, as well as equipment where appropriate, to facilitate these growth opportunities.
As we've geographically diversified, I continue to closely monitor our various regions. In North Dakota and based on a recent trip there, construction at Fargo-Moorhead is progressing well into this most important period for the project. In northern Canada, we are undergoing a restructuring initiative within the Nuna Group of Companies which will return it to its legacy of operational excellence. In Fort McMurray, our fleet continues to operate day-in day-out as we work with our customers in their goal to achieve low-cost operations in the oil sands region. 2024 will be a busy year for us and we are looking forward to executing and delivering another record year."
Consolidated Financial Highlights
Three months ended Year ended December 31, December 31, (dollars in thousands, except per share amounts) 2023 2022 2023 2022 Revenue $ 326,298 $ 233,417 $ 957,220 $ 769,539 Cost of sales 218,853 154,967 671,684 548,723 Depreciation 41,990 35,860 131,319 119,268 Gross profit $ 65,455 $ 42,590 $ 154,217 $ 101,548 Gross profit margin 20.1 % 18.2 % 16.1 % 13.2 % General and administrative expenses (excluding stock-based compensation)(i) 18,702 6,648 41,016 25,075 Stock-based compensation expense (496 ) 4,910 15,828 4,780 Operating income 45,779 31,565 95,714 71,157 Interest expense, net 14,007 7,774 36,948 24,543 Net income 17,646 26,081 63,141 67,372 Adjusted EBITDA(i) 101,136 85,875 296,963 245,352 Adjusted EBITDA margin(i)(ii) 25.1 % 26.8 % 23.3 % 23.3 % Per share information Basic net income per share $ 0.66 $ 0.99 $ 2.38 $ 2.46 Diluted net income per share $ 0.58 $ 0.84 $ 2.09 $ 2.15 Adjusted EPS(i) $ 0.87 $ 1.10 $ 2.83 $ 2.41
(i) See "Non-GAAP Financial Measures". (ii) Adjusted EBITDA margin is calculated using adjusted EBITDA over total combined revenue.
Three months ended Year ended December 31, December 31, (dollars in thousands) 2023 2022 2023 2022 Consolidated Statements of Cash Flows Cash provided by operating activities $ 160,870 $ 78,099 $ 270,391 $ 169,201 Cash used in investing activities (137,756 ) (17,524 ) (244,879 ) (97,469 ) Effect of exchange rate on changes in cash 3,167 (94 ) 1,705 304 Add back of growth and non-cash items included in the above figures: Acquisition of MacKellar(i) 51,671 — 51,671 — Acquisition costs 5,934 — 7,095 — Growth capital additions(ii) 35,941 — 40,416 — Acquisition of ML Northern(iii) — 7,207 — 7,207 Non-cash changes in fair value of contingent consideration (8,268 ) — (8,268 ) — Capital additions financed by leases(ii) (931 ) (236 ) (28,159 ) (8,931 ) Free cash flow (i) $ 110,628 $ 67,452 $ 89,972 $ 70,312
(i) See "Non-GAAP Financial Measures".
Results for the Three Months Ended December 31, 2023
Combined revenue of $403.4 million , compared to $320.1 million in the same period last year, and revenue from wholly-owned entities was $326.3 million , up from $233.4 million in the same period last year. The majority of the quarter-over-quarter increase in revenue was driven by the October 2023 acquisition of MacKellar. MacKellar generated a full quarter of revenue totaling $122.5 million . Aside from MacKellar, revenue was down over the same period in 2022 as a result of changes in timing of reclamation projects beginning later than the previous year and certain construction scopes concluding earlier in 2023, relative to the same period in 2022.
Combined gross profit margin of 18.4% was up from 17.8% in the prior year. The improvement in combined gross profit in the current period was driven by the acquisition of MacKellar. MacKellar generated gross profit of 23.7% in the quarter.
General and administrative expenses (excluding stock-based compensation expense) were $18.7 million , or 5.7% of revenue for the three months ended December 31, 2023, up from $6.6 million , or 2.8% of revenue in the same period last year. General and administrative expenses in the quarter include one-time costs of $5.9 million related to the acquisition of MacKellar. MacKellar's administrative cost profile is similar to the Canadian and U.S. operations.
Cash related interest expense of $13.2 million represents an average cost of debt of 8.8% (compared to $7.5 million and 7.1% , respectively, for the three months ended December 31, 2022). The increase in interest expense is primarily attributed to the higher balance on the Credit Facility and increases in the variable rate.
Net income of $17.6 million in Q4 2023 compared to $26.1 million in the same period last year as higher gross profit was more than offset by increased interest expense, increased general and administrative expenses from the one-time acquisition costs, and lower equity earnings from our joint ventures.
Free cash flow in the quarter was $110.6 million driven primarily by adjusted EBITDA of $101.1 million less sustaining capital spending of $40.8 million and cash interest paid of $13.2 million .
Liquidity
Including equipment financing availability and factoring in the amended Credit Facility agreement, total available capital liquidity of $292.6 million includes total liquidity of $217.9 million , $60.1 million of unused finance lease borrowing availability, and $14.6 million of unused other borrowing availability as at December 31, 2023. Liquidity is primarily provided by the terms of our $478.0 million credit facility which allows for funds availability based on a trailing twelve-month EBITDA as defined in the agreement, and is now scheduled to expire in October 2026.
Business Updates
Strategic Focus Areas for 2024
Safety - now on a global basis, maintain our uncompromising commitment to health and safety while elevating the standard of excellence in the field; Execution - enhance equipment availability in Canada and Australia through in-house fleet maintenance, reliability programs, technical improvements, and management systems; Operational excellence - with a specific focus on Nuna Group of Companies, put into action practical and experienced-based protocols to ensure predictable high-quality project execution; Integration - implement ERP and best practices at MacKellar, including identification of opportunities to better utilize our capital and equipment in Australia; Diversification - pursue diversification of customers and resources through strategic partnerships, industry expertise and investment in Indigenous joint ventures; and Sustainability - further develop and deliver into our environmental, social, and governance targets as disclosed and committed to in our annual reporting. O utlook for 2024
The following table provides projected key measures for 2024 and actual results of 2023 and 2022. The measures for 2024 are predicated on contracts currently in place, including expected renewals and the heavy equipment fleet that we own and operate.
Key measures 2022 Actual 2023 Actual 2024 Outlook Combined revenue $1.1B $1.3B $1.5 - $1.7B Adjusted EBITDA(i) $245M $297M $430 - $470M Sustaining capital(i) $113M $169M $170 - $190M Adjusted EPS(i) $2.41 $ 2.83 $4.25 - $4.75 Free cash flow(i) $70M $90M $160 - $185M Capital allocation Growth spending $13M $40M $55 - $70M Net debt leverage(i) 1.5x 1.7x Targeting 1.5x
(i) See "Non-GAAP Financial Measures".(ii) Shareholder activity includes common shares purchased under a NCIB, dividends paid and the purchase of treasury shares.
Conference Call and Webcast
Management will hold a conference call and webcast to discuss our financial results for the three months and year ended December 31, 2023, tomorrow, Thursday, March 14, 2024, at 9:00 am Eastern Time (7:00 am Mountain Time).
The call can be accessed by dialing:
Toll free: 1-888-886-7786 Conference ID: 29416987
A replay will be available through April 12, 2024, by dialing:
Toll Free: 1-877-674-7070 Conference ID: 29416987 Playback Passcode: 416987
A slide deck for the webcast will be available for download the evening prior to the call and will be found on the company’s website at www.nacg.ca/presentations/
The live presentation and webcast can be accessed at:
https://onlinexperiences.com/scripts/Server.nxp?LASCmd=AI:4;F:QS!10100&ShowUUID=E7B12076-0168-45B4-8211-E024A0E31C5D
A replay will be available until April 12, 2024, using the link provided.
Basis of Presentation
We have prepared our consolidated financial statements in conformity with accounting principles generally accepted in the United States ("US GAAP"). Unless otherwise specified, all dollar amounts discussed are in Canadian dollars. Please see the Management’s Discussion and Analysis ("MD&A") for the three months and year ended December 31, 2023, for further detail on the matters discussed in this release. In addition to the MD&A, please reference the dedicated Q4 2023 Results Presentation for more information on our results and projections which can be found on our website under Investors - Presentations.
Change in significant accounting policy - Basis of presentation
During the first quarter of 2023, the Company updated the presentation of finance lease obligations within the Consolidated Balance Sheets to be included in long-term debt. Within the long-term debt note, finance lease obligations, financing obligations, and promissory notes have been combined as equipment financing. Finance lease obligations are the finance lease liabilities recognized in accordance with the Company's lease policy which is disclosed in our Annual Report. Financing obligations arise when the Company finances its owned equipment. There has been no change in the Company’s accounting policy for finance lease obligations or change in the recognition or measurement of the related balances now recognized within long-term debt. The change in presentation had no effect on the reported results of operations. The comparative period has been updated to reflect this presentation change.
Recent accounting pronouncements not yet adopted
Joint venture formations
In August 2023, the FASB issued ASU 2023-05, Business Combinations - Joint Venture Formations. This accounting standard update was issued to create new requirements for valuing contributions made to a joint venture upon formation. This standard is effective January 1, 2025, with early adoption permitted. We are assessing the impact the adoption of this standard may have on its consolidated financial statements.
Segment reporting
In November 2023, the FASB issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures. This accounting standard update was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This standard is effective for the fiscal year beginning January 1, 2024. We are assessing the impact the adoption of this standard may have on its consolidated financial statements.
Income taxes
In December 2023, the FASB issued ASU 2023-09, Income Taxes: Improvements to Income Tax Disclosures. This accounting standard update was issued to increase transparency by improving income tax disclosures primarily related to the rate reconciliation and income taxes paid information. This standard is effective for the fiscal year beginning January 1, 2025, with early adoption permitted. We are assessing the impact the adoption of this standard may have on its consolidated financial statements.
Forward-Looking Information
The information provided in this release contains forward-looking statements. Forward-looking statements include statements preceded by, followed by or that include the words "anticipate", "believe", "expect", "should" or similar expressions and include guidance with respect to financial metrics provided in our outlook for 2024.
The material factors or assumptions used to develop the above forward-looking statements include, and the risks and uncertainties to which such forward-looking statements are subject, are highlighted in the MD&A for the three months and year ended December 31, 2023. Actual results could differ materially from those contemplated by such forward-looking statements because of any number of factors and uncertainties, many of which are beyond NACG’s control. Undue reliance should not be placed upon forward-looking statements and NACG undertakes no obligation, other than those required by applicable law, to update or revise those statements. For more complete information about NACG, please read our disclosure documents filed with the SEC and the CSA. These free documents can be obtained by visiting EDGAR on the SEC website at www.sec.gov or on the CSA website at www.sedarplus.ca and on our company website at www.nacg.ca .
N on-GAAP Financial Measures
This press release presents certain non-GAAP financial measures, non-GAAP ratios, and supplementary financial measures that may be useful to investors in analyzing our business performance, leverage, and liquidity. A non-GAAP financial measure is defined by relevant regulatory authorities as a numerical measure of an issuer's historical or future financial performance, financial position or cash flow that is not specified, defined or determined under the issuer’s GAAP and that is not presented in an issuer’s financial statements. A "non-GAAP ratio" is a ratio, fraction, percentage or similar expression that has a non-GAAP financial measure as one or more of its components. Non-GAAP financial measures and ratios do not have standardized meanings under GAAP and therefore may not be comparable to similar measures presented by other issuers. They should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. A "supplementary financial measure" is a financial measure disclosed, or intended to be disclosed, on a periodic basis to depict historical or future financial performance, financial position or cash flows that does not fall within the definition of a non-GAAP financial measure or non-GAAP ratio. The non-GAAP financial measures and ratios we present include, "adjusted EBIT", "adjusted EBITDA", "adjusted EBITDA margin" "adjusted EPS", "adjusted net earnings", "backlog", "capital additions", "capital expenditures, net", "capital inventory", "capital work in progress", "cash provided by operating activities prior to change in working capital", "combined gross profit", "combined gross profit margin", "equity investment depreciation and amortization", "equity investment EBIT", "free cash flow", "general and administrative expenses (excluding stock-based compensation)", "gross profit", "growth capital", "invested capital", "net debt", "sustaining capital", "total capital liquidity", "total combined revenue", and "total debt". We also use supplementary financial measures such as "gross profit margin" and "total net working capital (excluding cash and current portion of long-term debt)" in our MD&A. Each non-GAAP financial measure used in this press release is defined under "Financial Measures" in our Management's Discussion and Analysis filed on EDGAR on the SEC website at www.sec.gov or on the CSA website at www.sedarplus.ca and on our company website at www.nacg.ca .
Reconciliation of total reported revenue to total combined revenue
Three months ended Year ended December 31, December 31, (dollars in thousands) 2023 2022 2023 2022 Revenue from wholly-owned entities per financial statements $ 326,298 $ 233,417 $ 957,220 $ 769,539 Share of revenue from investments in affiliates and joint ventures 169,662 183,006 686,299 596,033 Elimination of joint venture subcontract revenue (92,522 ) (96,315 ) (369,891 ) (311,307 ) Total combined revenue (i) $ 403,438 $ 320,108 $ 1,273,628 $ 1,054,265
(i) See "Non-GAAP Financial Measures".
Reconciliation of reported gross profit to combined gross profit
Three months ended Year ended December 31, December 31, (dollars in thousands) 2023 2022 2023 2022 Gross profit from wholly-owned entities per financial statements $ 65,455 $ 42,590 $ 154,217 $ 101,548 Share of gross profit from investments in affiliates and joint ventures 8,670 14,541 49,638 49,581 Combined gross profit(i) $ 74,125 $ 57,131 $ 203,855 $ 151,129
(i) See "Non-GAAP Financial Measures".
Reconciliation of net income to adjusted net earnings, adjusted EBIT and adjusted EBITDA
Three months ended Year ended December 31, December 31, (dollars in thousands) 2023 2022 2023 2022 Net income $ 17,646 $ 26,081 $ 63,141 $ 67,372 Adjustments: Loss (gain) on disposal of property, plant and equipment 1,470 (533 ) 1,659 536 Stock-based compensation (benefit) expense (496 ) 4,910 15,828 4,780 Acquisition costs 5,934 — 7,095 — Loss on equity investment customer bankruptcy claim settlement — — 759 — Loss (gain) on derivative financial instruments 916 (778 ) (6,063 ) (778 ) Equity investment (gain) loss on derivative financial instruments (713 ) 364 (1,362 ) (4,776 ) Tax effect of the above items (1,589 ) (1,006 ) (5,829 ) (1,222 ) Adjusted net earnings (i) $ 23,168 $ 29,038 $ 75,228 $ 65,912 Adjustments: Tax effect of the above items 1,589 1,006 5,829 1,222 Change in fair value of contingent consideration 4,681 — 4,681 — Interest expense, net 14,007 7,774 36,948 24,543 Income tax expense 10,930 6,889 22,822 17,073 Equity earnings in affiliates and joint ventures(i) (2,401 ) (8,401 ) (25,815 ) (37,053 ) Equity investment EBIT(i) 1,787 9,363 25,545 42,148 Adjusted EBIT (i) $ 53,761 $ 45,669 $ 145,238 $ 113,845 Adjustments: Depreciation and amortization 42,277 36,094 132,516 120,124 Equity investment depreciation and amortization(i) 5,098 4,112 19,209 11,383 Adjusted EBITDA (i) $ 101,136 $ 85,875 $ 296,963 $ 245,352 Adjusted EBITDA margin (i)(ii) 25.1 % 26.8 % 23.3 % 23.3 %
(i) See "Non-GAAP Financial Measures".(ii) Adjusted EBITDA margin is calculated using adjusted EBITDA over total combined revenue.
Reconciliation of equity earnings in affiliates and joint ventures to equity investment EBIT
Three months ended Year ended December 31, December 31, (dollars in thousands) 2023 2022 2023 2022 Equity (earnings) loss in affiliates and joint ventures $ 2,401 $ 8,401 $ 25,815 $ 37,053 Adjustments: Interest expense, net (268 ) 688 (1,183 ) 2,589 Income tax expense (324 ) 275 970 2,442 (Gain) loss on disposal of property, plant and equipment (22 ) (1 ) (57 ) 64 Equity investment EBIT (i) $ 1,787 $ 9,363 $ 25,545 $ 42,148 Depreciation 4,983 3,936 18,555 10,679 Amortization of intangible assets 115 176 654 704 Equity investment depreciation and amortization (i) $ 5,098 $ 4,112 $ 19,209 $ 11,383
(i) See "Non-GAAP Financial Measures"
About the Company
North American Construction Group Ltd. is a premier provider of heavy civil construction and mining services in Canada, the U.S. and Australia. For 70 years, NACG has provided services to the mining, resource and infrastructure construction markets.
For further information contact:
Jason Veenstra, CPA, CA Chief Financial Officer North American Construction Group Ltd. (780) 960.7171 ir@nacg.ca www.nacg.ca
Consolidated Balance Sheets
As at December 31 (Expressed in thousands of Canadian Dollars)
2023 2022 Assets Current assets Cash $ 88,614 $ 69,144 Accounts receivable 97,855 83,811 Contract assets 35,027 15,802 Inventories 64,962 49,898 Prepaid expenses and deposits 7,402 10,587 Assets held for sale 1,340 1,117 295,200 230,359 Property, plant and equipment 1,142,946 645,810 Operating lease right-of-use assets 12,782 14,739 Intangible assets 6,971 6,773 Investments in affiliates and joint ventures 81,435 75,637 Other assets 7,144 5,808 Deferred tax assets — 387 Total assets $ 1,546,478 $ 979,513 Liabilities and shareholders' equity Current liabilities Accounts payable $ 146,190 $ 102,549 Accrued liabilities 94,726 43,784 Contract liabilities 59 1,411 Current portion of long-term debt 81,306 42,089 Current portion of operating lease liabilities 1,742 2,470 324,023 192,303 Long-term debt 611,313 378,452 Operating lease liabilities 11,307 12,376 Other long-term obligations 134,357 18,576 Deferred tax liabilities 108,824 71,887 1,189,824 673,594 Shareholders' equity Common shares (authorized – unlimited number of voting common shares; issued and outstanding – December 31, 2023 - 27,827,282 (December 31, 2022 – 27,827,282)) 229,455 229,455 Treasury shares (December 31, 2023 - 1,090,187 (December 31, 2022 - 1,406,461)) (16,165 ) (16,438 ) Additional paid-in capital 20,739 22,095 Retained earnings 123,032 70,501 Accumulated other comprehensive (loss) income (407 ) 306 Shareholders' equity 356,654 305,919 Total liabilities and shareholders' equity $ 1,546,478 $ 979,513
Consolidated Statements of Operations and Comprehensive Income
For the years ended December 31 (Expressed in thousands of Canadian Dollars, except per share amounts)
2023 2022 Revenue $ 957,220 $ 769,539 Cost of sales 671,684 548,723 Depreciation 131,319 119,268 Gross profit 154,217 101,548 General and administrative expenses 56,844 29,855 Loss on disposal of property, plant and equipment 1,659 536 Operating income 95,714 71,157 Equity earnings in affiliates and joint ventures (25,815 ) (37,053 ) Interest expense, net 36,948 24,543 Change in fair value of contingent consideration 4,681 — Gain on derivative financial instruments (6,063 ) (778 ) Income before income taxes 85,963 84,445 Current income tax expense 6,841 1,627 Deferred income tax expense 15,981 15,446 Net income 63,141 67,372 Other comprehensive income Unrealized foreign currency translation loss (gain) 713 (304 ) Comprehensive income $ 62,428 $ 67,676 Per share information Basic net income per share $ 2.38 $ 2.46 Diluted net income per share $ 2.09 $ 2.15
What was the allocated purchase price for the MacKellar Group acquisition?
The allocated purchase price for the MacKellar Group acquisition was $369.7 million.
What was the revenue for the fourth quarter of 2023 compared to the same period in 2022?
The revenue for the fourth quarter of 2023 was $326.3 million, compared to $233.4 million in the same period in 2022.
What was the adjusted EBITDA margin for the fourth quarter of 2023?
The adjusted EBITDA margin for the fourth quarter of 2023 was 25.1%.
What were the challenges faced by NACG in the fourth quarter of 2023?
NACG faced challenges with project losses impacting margins and increased debt levels in the fourth quarter of 2023.
What is the outlook for NACG in 2024?
The outlook for NACG in 2024 focuses on geographic diversification and operational excellence.