DRUMMONDVILLE, QUEBEC–(Marketwired – May 11, 2016) – NAPEC Inc. (“NAPEC” or “the Corporation”) (TSX:NPC) reported its results today for the first quarter ended March 31, 2016. All amounts are in Canadian dollars unless otherwise indicated.

“NAPEC turned in a strong performance in the first quarter of 2016 despite the seasonal effect associated with certain activities. We posted strong volume growth in both Canada and the United States, and profitability increased significantly, in particular due to the gradual introduction of higher-value-added services across our network,” said Pierre L. Gauthier, President and Chief Executive Officer of NAPEC.

FIRST QUARTER RESULTS

Revenues for the first quarter of 2016 were $92.6 million, up 57.5% from $58.8 million in the first quarter of 2015. This variation was mainly driven by higher revenues from contracts related to electricity transmission and distribution lines, as well as the addition of the road matting services of Bemis, LLC (“Bemis”), which was acquired in October 2015. Fluctuations in the exchange value of the Canadian dollar increased the value of U.S.-dollar-denominated revenues by approximately $6.8 million during the quarter ended March 31, 2016, compared to the same period in 2015

The greater business volume and a more favourable revenue mix led to a significant rise in the Corporation’s earnings before interest, taxes, depreciation and amortization (“EBITDA”). During the first quarter of 2016, EBITDA amounted to $6.6 million, or 7.1% of revenues, compared to $1.7 million, or 2.9% of revenues, for the corresponding period a year earlier.

The Corporation ended the first quarter of 2016 with a net loss of $376,000, or $0.00 per share, basic and diluted, compared to a net loss of $1.1 million, or $0.02 per share, basic and diluted, a year earlier. The net loss reflects increases in depreciation arising from important capital investments made to support growth and in the amortization of intangible assets related to the acquisition of Bemis.

FINANCIAL POSITION

As at March 31, 2016, the long-term debt, including the current portion, was $60.3 million, versus $63.5 million three months earlier, while the ratio of long-term debt to equity was 0.60, unchanged from the end of the previous quarter. As at March 31, 2016, the Corporation had a cash balance of $2.8 million, while an amount of $20.3 million was available on its $40.0 million authorized renewable credit facility.

STRONG BACKLOG

As at March 31, 2016, NAPEC’s backlog stood at $467 million. This amount includes approximately $82.6 million in contracts announced in a press release dated April 13, 2016.

OUTLOOK

“Demand for our services remains high, as evidenced by our strong backlog and our bidding activity. With its new organizational structure, NAPEC is able to better focus its efforts on winning contracts and to generate higher profitability in their execution. Moreover, our subsidiaries’ strong reputations in their respective markets, combined with our ability to stimulate the cross-selling of services across our network, are allowing us to achieve and exceed our targets,” concluded Mr. Gauthier.

NON-IFRS MEASURE

EBITDA does not have a standardized meaning prescribed by IFRS and is therefore considered to be a non-IFRS measure. It is therefore not necessarily comparable to similar measures presented by other companies. This measure is presented and described in this release in order to provide additional information regarding the Corporation’s liquidity and its ability to generate funds to finance its operations.

FORWARD-LOOKING STATEMENTS

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.

OVERVIEW OF THE CORPORATION

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 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 (www.sedar.com) and on the Corporation’s website, at www.napec.ca.

Contacts:
Pierre L. Gauthier
President and Chief Executive Officer
819-479-7771
[email protected]

Mario Trahan, CPA, CMA
Chief Financial Officer
819-479-7771
[email protected]

MaisonBrison
Martin Goulet, CFA
514-731-0000
[email protected]