- Reported Q3 2018 IFRS net income attributable to SNC-Lavalin
shareholders of $120.7 million,
compared to $103.6 million in Q3
2017.
- Q3 2018 adjusted net income from E&C(1) of
$124.3 million, up 40.2%, (or
$0.71 per diluted share, up 39.2%),
compared to Q3 2017.
- Continued strong adjusted E&C EBITDA(7) margin
performance of 8.9% in Q3 2018, up from 7.6% in Q3 2017.
- Strong backlog(8) of $15.2
billion at the end of September
2018, with bookings of $2.6
billion in Q3 2018, representing a 1.0 book-to-bill
ratio.
- 2018 Outlook maintained: adjusted diluted EPS from
E&C(2) in the range of $2.60 to $2.85 and
adjusted consolidated diluted EPS(5) in the range of
$3.60 to $3.85.
To watch Neil Bruce comment on
SNC-Lavalin's third quarter 2018 financial results, view
here.
MONTREAL, Nov. 1, 2018 /CNW Telbec/ - SNC-Lavalin Group
Inc. (TSX: SNC) today announces its results for the third quarter
ended September 30, 2018.
"We are very pleased with our third quarter performance,
which was slightly better than our expectations," said Neil Bruce, President and Chief Executive
Officer, SNC-Lavalin Group Inc. "It has now been more than a year
since we acquired Atkins, and I can proudly say that the
integration was successful, enhancing and diversifying our
services, delivering $124 million of
cost synergies, and we are starting to realize revenue synergies.
Q3 results also demonstrate EDPM revenue organic growth, which
showcases the growth potential of this sector. Despite external
unfortunate developments beyond our control, our strong nine months
performance coupled with our high quality backlog across our
sectors allow us to maintain our 2018 outlook."
- Q3 2018 reported IFRS net income attributable to SNC-Lavalin
shareholders increased by 16.6% to $120.7
million, or $0.69 per diluted
share, compared with $103.6 million,
or $0.59 per diluted share, for the
corresponding period in 2017. Q3 2018 included acquisition-related
and integration costs of $8.1 million
(after taxes), amortization of intangible assets related to
business combinations of $37.6
million (after taxes) and net charges related to
restructuring and other of $2.2
million (after taxes).
- Adjusted net income from E&C(1) increased by
40.2% to $124.3 million in Q3 2018,
or $0.71 per diluted share, compared
with $88.6 million, or $0.51 per diluted share for Q3 2017, mainly due
to lower corporate selling, general and administrative expenses and
a decrease in income taxes expense partially offset by a slightly
lower total Segment EBIT(6). On a segmented basis, the
Thermal Power segment recorded a lower Segment EBIT(6)
loss of $6.1 million in Q3 2018,
compared to a loss of $40.6 million
in Q3 2017. These losses are due to the Company's last challenging
fixed-price engineering, procurement and construction (EPC) thermal
power plant project in the United
States. The EDPM and Oil & Gas segments had a strong
quarter, with a 10% and 8% Segment EBIT(6) margin,
respectively, while the Clean Power and Infrastructure recorded
lower Segment EBIT(6) in Q3 2018 compared to Q3 2017,
mainly due to projects execution timing.
- Adjusted net income from Capital(3) totaled
$44.2 million in Q3 2018, or
$0.25 per diluted share, compared
with $48.1 million, or $0.27 per diluted share for the corresponding
period in 2017, mainly due to a lower contribution from capital
investments transferred to the SNCL IP Partnership, partially
offset by an increase in dividends received from Highway 407
ETR.
- E&C revenue for the third quarter ended September 30, 2018 was $2.5 billion, compared with $2.6 billion in the third quarter of 2017. The
variation was mainly due to lower revenues in Oil & Gas, due to
near completion and completion of major projects, and in Thermal
Power, as the Company made the strategic decision to exit that
market, mostly offset by an increase in the Infrastructure, Mining
& Metallurgy and EDPM segments. Note that the EDPM revenues
organic growth (at a constant foreign exchange rate), Q3 2018 over
Q3 2017, was 3%.
- The Company's backlog(8) totaled $15.2 billion as at September 30, 2018. Total bookings for Q3 2018
amounted to $2.6 billion,
representing a 1.0 book-to-bill ratio. Total bookings for the
nine-month period ended September 30,
2018 totaled $8.9 billion,
representing a 1.2 book-to-bill ratio. Q3 2018 bookings included
$0.8 billion in Oil & Gas (1.2
book-to-bill ratio), $0.7 billion in
EDPM (0.9 book-to-bill ratio) and $0.5
billion in Clean Power (5.6 book-to-bill ratio).
- As of September 30, 2018, the
Company continues to maintain appropriate liquidity with
$735.9 million of cash and cash
equivalents, $2.2 billion of recourse
debt and $2.1 billion in unused
capacity under its $2.6 billion
committed revolving credit facility, while the net recourse debt to
adjusted EBITDA ratio(9) was 1.6.
2018 Outlook
The Company maintains its 2018 outlook for the adjusted diluted
EPS from E&C(2), which is expected to be in the
range of $2.60 to $2.85, as well as for the adjusted consolidated
diluted EPS(5) in the range of $3.60 to $3.85.
While we expect continuing market challenges in 2018 in certain
of the Company's sectors, we anticipate benefiting from Atkins
synergies and restructuring savings. As such, we expect growth in
the Company's total Segment EBIT(6) in 2018, compared
with 2017. We also expect that the Segment EBIT(6) for
the EDPM, Mining & Metallurgy, Nuclear and Thermal Power
segments to increase, while the Segment EBIT(6) for the
Oil & Gas, Clean Power and Infrastructure segments are expected
to decrease. Note that the 2018 outlook will include twelve months
of Atkins' operations and related financing, compared to
approximately six months in 2017. It also assumes a weighted
average number of outstanding shares of approximately 175 million.
The tax rate for the adjusted E&C business is expected to be
approximately 20%.
This outlook is based on the assumptions and methodology
described in the Company's 2017 Management's Discussion and
Analysis under the heading, "How We Budget and Forecast Our
Results" and the "Forward-Looking Statements" section below and is
subject to the risks and uncertainties summarized therein, which
are more fully described in the Company's public disclosure
documents.
Quarterly Dividend
The Board of Directors today declared a cash dividend of
$0.287 per share, payable on
November 29, 2018, to shareholders of
record on November 15, 2018. This
dividend is an "eligible dividend" for income tax purposes.
Q3 2018 Results Conference Call / Webcast
SNC-Lavalin will hold a conference call today at 1:30 p.m. EDT to review results for its third
quarter. To join the conference call, please dial toll free at 1
800 281 7973 in North America, 647
794 1827 in Toronto, 438 968 3557
in Montreal, or 080 0358 6377 in
the United Kingdom. A live audio
webcast of the conference call and an accompanying slide
presentation will be available at investors.snclavalin.com. A
recording of the conference call will be available on our website
within 24 hours following the call.
Non-IFRS Financial Measures and Additional IFRS
Measures
The Company reports its financial results in accordance with
IFRS. However, the following non-IFRS measures and additional IFRS
measures are used by the Company: Adjusted net income from E&C,
Adjusted diluted EPS from E&C, Adjusted net income from
Capital, Adjusted diluted EPS from Capital, Adjusted consolidated
diluted EPS, EBITDA, Adjusted E&C EBITDA, Segment EBIT and 2017
backlog. Additional details for these non-IFRS measures and
additional IFRS measures can be found below and in SNC-Lavalin's
MD&A, which is available in the Investors section of the
Company's website at www.snclavalin.com. Non-IFRS financial
measures do not have any standardized meaning as prescribed by IFRS
and therefore may not be comparable to similar measures presented
by other issuers. Management believes that, in addition to
conventional measures prepared in accordance with IFRS, these
non-IFRS measures provide additional insight into the Company's
financial results and certain investors may use this information to
evaluate the Company's performance from period to period. However,
these non-IFRS financial measures have limitations and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS.
About SNC-Lavalin
Founded in 1911, SNC-Lavalin is a global fully integrated
professional services and project management company and a major
player in the ownership of infrastructure. From offices around the
world, SNC-Lavalin's employees are proud to build what matters. Our
teams provide comprehensive end-to-end project solutions –
including capital investment, consulting, design, engineering,
construction management, sustaining capital and operations and
maintenance – to clients across Oil and Gas, Mining and Metallurgy,
Infrastructure, Clean Power, Nuclear and EDPM (engineering, design
and project management). On July 3,
2017, SNC-Lavalin acquired Atkins, one of the world's most
respected design, engineering and project management consultancies,
which has been integrated into our
sectors. www.snclavalin.com
(1) Adjusted net income from E&C is
defined as net income attributable to SNC-Lavalin shareholders from
E&C, excluding charges related to restructuring, right-sizing
and other, acquisition-related costs and integration costs, impact
of U.S. corporate tax reform as well as amortization of intangible
assets related to business combinations, the net expense for the
2012 class action lawsuits settlement and the gains (losses) on
disposals of E&C businesses and the head office building.
E&C is defined in the Company's 2017 financial statements and
Management's Discussion and Analysis. The term "Adjusted net income
from E&C" does not have any standardized meaning as prescribed
by IFRS. Therefore, it may not be comparable to similar measures
presented by other issuers. Management uses this measure as a more
meaningful way to compare the Company's financial performance from
period to period. Management believes that, in addition to
conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate the Company's
performance. See reconciliation below.
(2) Adjusted diluted EPS from E&C is
defined as the adjusted net income from E&C divided by the
diluted weighted average number of outstanding shares for the
period.
(3) Adjusted net income from Capital is
defined as net income attributable to SNC-Lavalin shareholders from
Capital, excluding the gains on disposals of Capital
Investments.
(4) Adjusted diluted EPS from Capital is
defined as the adjusted net income from Capital divided by the
diluted weighted average number of outstanding shares for the
period.
(5) Adjusted consolidated diluted EPS is
defined as the adjusted net income from E&C plus the adjusted
net income from Capital divided by the diluted weighted average
number of outstanding shares for the period.
(6) Segment EBIT consists of revenues less
i) direct costs of activities, ii) directly related selling,
general and administrative expenses, iii) corporate selling,
general and administrative expenses that are allocated to segments;
and iv) non-controlling interests before taxes. Expenses that are
not allocated to the Company's segments include: certain corporate
selling, general and administrative expenses that are not directly
related to projects or segments, impairment loss arising from
expected credit losses, gain (loss) arising on financial assets at
fair value through profit or loss, restructuring costs, goodwill
impairment, acquisition-related costs and integration costs,
amortization of intangible assets related to business combinations,
and the net expense for the 2012 class action lawsuits settlement,
as well as gains (losses) on disposals of E&C businesses,
Capital investments and the head office building. The term "Segment
EBIT" does not have any standardized meaning as prescribed by IFRS.
Therefore, it may not be comparable to similar measures presented
by other issuers. Management uses this measure as a more meaningful
way to compare the Company's financial performance from period to
period. Management believes that, in addition to conventional
measures prepared in accordance with IFRS, certain investors use
this information to evaluate the Company's performance.
(7) Adjusted E&C EBITDA is defined
herein as earnings from E&C before net financial expenses
(income), income taxes, depreciation and amortization, and excludes
charges related to restructuring, right-sizing and other, the
acquisition-related costs and integration costs, the net expense
for the 2012 class action lawsuits settlement, as well as the gains
(losses) on disposals of E&C businesses and head office
building. The term "Adjusted E&C EBITDA" does not have any
standardized meaning as prescribed by IFRS. Therefore, it may not
be comparable to similar measures presented by other issuers.
Management uses this measure as a more meaningful way to compare
the Company's financial performance from period to period.
Management believes that, in addition to conventional measures
prepared in accordance with IFRS, certain investors use this
information to evaluate the Company's performance.
(8) In 2018, backlog represents the
Remaining Performance Obligations, an IFRS measure, and is defined
as a forward-looking indicator of anticipated revenues to be
recognized by the Company, determined based on contract awards that
are firm and amounting to the transaction price allocated to
remaining performance obligations. Management could be required to
make estimates regarding the revenue to be generated for long-term
firm reimbursable contracts. In 2017, backlog did not
have any standardized meaning as prescribed by IFRS and
represented a forward-looking indicator of anticipated revenues to
be recognized by the Company, determined based on contract awards
that are considered firm. Management could be required to make
estimates regarding the revenue to be generated for long-term firm
reimbursable contracts. In order to provide information that is
comparable to the backlog of other categories of activity, the
Company limited the O&M activities backlog, which can cover a
period of up to 40 years, to the earlier of: i) the contract term
awarded; and ii) the next five years.
(9) Net recourse debt to adjusted EBITDA
ratio is defined herein as the net recourse debt divided by the
trailing 12-months adjusted EBITDA, less interest on limited
recourse debt. The term "Net recourse debt to adjusted
EBITDA ratio" does not have any standardized meaning as prescribed
by IFRS. Therefore, it may not be comparable to similar measures
presented by other issuers. Management uses this measure as a more
meaningful way to compare the Company's financial performance from
period to period. Management believes that, in addition to
conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate the Company's
performance.
SNC-Lavalin
Financial Summary
|
|
|
|
(in thousands of
Canadian dollars, unless
otherwise indicated)
|
Third
Quarter
|
Nine months
ended September
30
|
|
2018
|
2017
|
2018
|
2017
|
|
|
|
|
|
Revenues
|
|
|
|
|
From
E&C
|
2,496,819
|
2,572,483
|
7,333,936
|
6,228,968
|
From
Capital
|
66,171
|
60,256
|
187,567
|
187,914
|
|
2,562,990
|
2,632,739
|
7,521,503
|
6,416,882
|
|
|
|
|
|
Net income
attributable to SNC-Lavalin shareholders
|
|
|
|
|
From
E&C
|
76,585
|
29,025
|
91,317
|
161,718
|
From
Capital
|
44,158
|
74,551
|
190,509
|
167,961
|
|
120,743
|
103,576
|
281,826
|
329,679
|
|
|
|
|
|
Diluted EPS
($)
|
|
|
|
|
From
E&C
|
0.44
|
0.17
|
0.52
|
1.02
|
From
Capital
|
0.25
|
0.42
|
1.08
|
1.06
|
|
0.69
|
0.59
|
1.60
|
2.08
|
|
|
|
|
|
Adjusted net
income attributable to SNC-Lavalin shareholders
|
|
|
|
|
From
E&C(1)
|
124,251
|
88,625
|
327,265
|
213,509
|
From
Capital(3)
|
44,159
|
48,083
|
132,105
|
136,090
|
|
168,410
|
136,708
|
459,370
|
349,599
|
|
|
|
|
|
Adjusted diluted
EPS ($)
|
|
|
|
|
From
E&C(2)
|
0.71
|
0.51
|
1.86
|
1.34
|
From
Capital(4)
|
0.25
|
0.27
|
0.75
|
0.86
|
|
0.96
|
0.78
|
2.62
|
2.20
|
|
|
|
|
|
Adjusted E&C
EBITDA(7)
|
223,416
|
196,319
|
590,456
|
383,158
|
Adjusted E&C
EBITDA margin
|
8.9%
|
7.6%
|
8.1%
|
6.2%
|
|
|
|
|
|
|
|
|
|
|
Backlog(8)
|
|
|
15,156,000
|
11,336,300
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
735,915
|
642,325
|
|
|
|
|
|
Recourse
debt
|
|
|
2,222,867
|
1,524,647
|
|
Note that certain
totals and subtotals may not reconcile due to
rounding
|
Reconciliation
of IFRS Net Income as Reported to Adjusted Net
Income
|
|
|
|
|
|
|
|
|
|
Net income,
as reported
(IFRS)
|
Net charges
related
to restructuring &
right-sizing plan and
other
|
Acquisition
|
Net loss (gain)
on disposals
of E&C
business and
Capital
investments
|
Net expense
for the 2012
class action
lawsuits
settlement
|
Impact of
U.S.
corporate
tax reform
|
Net income,
adjusted
(Non-IFRS)
|
|
|
|
Acquisition-related
costs and integration
costs
|
Amortization of
intangible assets
related to
business
combinations
|
|
|
|
|
|
Third Quarter
2018
|
In
M$
|
E&C
|
76.6
|
2.2
|
8.1
|
37.6
|
(0.1)
|
-
|
(0.2)
|
124.3
|
Capital
|
44.2
|
-
|
-
|
-
|
-
|
-
|
-
|
44.2
|
|
120.7
|
2.2
|
8.1
|
37.6
|
(0.1)
|
-
|
(0.2)
|
168.4
|
|
Per Diluted share
($)
|
E&C
|
0.44
|
0.01
|
0.05
|
0.21
|
(0.00)
|
-
|
(0.00)
|
0.71
|
Capital
|
0.25
|
-
|
-
|
-
|
-
|
-
|
-
|
0.25
|
|
0.69
|
0.01
|
0.05
|
0.21
|
(0.00)
|
-
|
(0.00)
|
0.96
|
|
Nine Months Ended
September 30, 2018
|
In
M$
|
E&C
|
91.3
|
10.2*
|
26.8
|
128.2
|
0.2
|
64.5
|
6.0
|
327.3
|
Capital
|
190.5
|
-
|
-
|
-
|
(58.4)
|
-
|
-
|
132.1
|
|
281.8
|
10.2
|
26.8
|
128.2
|
(58.2)
|
64.5
|
6.0
|
459.4
|
|
Per Diluted share
($)
|
E&C
|
0.52
|
0.06
|
0.15
|
0.73
|
0.00
|
0.37
|
0.03
|
1.86
|
Capital
|
1.08
|
-
|
-
|
-
|
(0.33)
|
-
|
-
|
0.75
|
|
1.60
|
0.06
|
0.15
|
0.73
|
(0.33)
|
0.37
|
0.03
|
2.62
|
Note that certain
totals and subtotals may not reconcile due to
rounding
|
|
*This amount
included $6.9 million ($5.6 million after taxes) of net charges
which did not meet the restructuring costs definition in accordance
with IFRS.
|
|
Net income,
as reported
(IFRS)
|
Net charges
related
to restructuring &
right-sizing plan and
other
|
Acquisition
|
Net gain on
disposals of
E&C business,
head office
building, and
Capital
investments
|
Net income,
adjusted
(Non-IFRS)
|
|
|
|
Acquisition-related
costs and integration
costs
|
Amortization of
intangible assets
related to
business
combinations
|
|
|
|
Third Quarter
2017
|
In
M$
|
E&C
|
29.0
|
2.1*
|
30.0
|
27.5
|
-
|
88.6
|
Capital
|
74.6
|
-
|
-
|
-
|
(26.5)
|
48.1
|
|
103.6
|
2.1
|
30.0
|
27.5
|
(26.5)
|
136.7
|
|
Per Diluted share
($)
|
E&C
|
0.17
|
0.01
|
0.17
|
0.16
|
-
|
0.51
|
Capital
|
0.42
|
-
|
-
|
-
|
(0.15)
|
0.27
|
|
0.59
|
0.01
|
0.17
|
0.16
|
(0.15)
|
0.78
|
|
Nine Months Ended
September 30, 2017
|
In
M$
|
E&C
|
161.7
|
27.3**
|
75.6
|
51.3
|
(102.4)
|
213.5
|
Capital
|
168.0
|
-
|
-
|
-
|
(31.9)
|
136.1
|
|
329.7
|
27.3
|
75.6
|
51.3
|
(134.3)
|
349.6
|
|
Per Diluted share
($)
|
E&C
|
1.02
|
0.16
|
0.48
|
0.33
|
(0.65)
|
1.34
|
Capital
|
1.06
|
-
|
-
|
-
|
(0.20)
|
0.86
|
|
2.08
|
0.16
|
0.48
|
0.33
|
(0.85)
|
2.20
|
|
Note that certain
totals and subtotals may not reconcile due to
rounding
|
|
*This amount
included $2.2 million ($1.0 million after taxes) of net charges
which did not meet the restructuring costs definition in accordance
with IFRS.
|
|
**This amount
included $6.2 million ($6.0 million after taxes) of net charges
which did not meet the restructuring costs definition in accordance
with IFRS.
|
Forward-looking Statements
Reference in this press release, and hereafter, to the
"Company" or to "SNC-Lavalin" means, as the context may require,
SNC-Lavalin Group Inc. and all or some of its subsidiaries or joint
arrangements, or SNC-Lavalin Group Inc. or one or more of its
subsidiaries or joint arrangements.
Statements made in this press release that describe the
Company's or management's budgets, estimates, expectations,
forecasts, objectives, predictions, projections of the future or
strategies may be "forward-looking statements", which can be
identified by the use of the conditional or forward-looking
terminology such as "aims", "anticipates", "assumes", "believes",
"cost savings", "estimates", "expects", "goal", "intends", "may",
"plans", "projects", "should", "synergies", "target", "vision",
"will", or the negative thereof or other variations thereon.
Forward-looking statements also include any other statements that
do not refer to historical facts. Forward-looking statements also
include statements relating to the following: i) future capital
expenditures, revenues, expenses, earnings, economic performance,
indebtedness, financial condition, losses and future prospects; and
ii) business and management strategies and the expansion and growth
of the Company's operations. All such forward-looking statements
are made pursuant to the "safe-harbour" provisions of applicable
Canadian securities laws. The Company cautions that, by their
nature, forward-looking statements involve risks and uncertainties,
and that its actual actions and/or results could differ materially
from those expressed or implied in such forward-looking statements,
or could affect the extent to which a particular projection
materializes. Forward-looking statements are presented for the
purpose of assisting investors and others in understanding certain
key elements of the Company's current objectives, strategic
priorities, expectations and plans, and in obtaining a better
understanding of the Company's business and anticipated operating
environment. Readers are cautioned that such information may not be
appropriate for other purposes.
The 2018 outlook referred to in this press release is
forward-looking information and is based on the methodology
described in the Company's 2017 Management's Discussion and
Analysis ("MD&A") under the heading "How We Budget and Forecast
Our Results" and is subject to the risks and uncertainties
described in the Company's public disclosure documents. The purpose
of the 2018 outlook is to provide the reader with an indication of
management's expectations, at the date of this press release,
regarding the Company's future financial performance and readers
are cautioned that this information may not be appropriate for
other purposes.
Forward-looking statements made in this press release are
based on a number of assumptions believed by the Company to be
reasonable as at the date hereof. The assumptions are set out
throughout the Company's 2017 MD&A, particularly in the
sections entitled "Critical Accounting Judgments and Key Sources of
Estimation Uncertainty" and "How We Analyze and Report our
Results", and as updated in the first, second and third quarter
2018 MD&A. The 2018 outlook also assumes that the federal
charges laid against the Company and its indirect subsidiaries
SNC-Lavalin International Inc. and SNC-Lavalin Construction Inc. on
February 19, 2015, will not have a
significant adverse impact on the Company's business in 2018. If
these assumptions are inaccurate, the Company's actual results
could differ materially from those expressed or implied in such
forward-looking statements. In addition, important risk factors
could cause the Company's assumptions and estimates to be
inaccurate and actual results or events to differ materially from
those expressed in or implied by these forward-looking statements.
These risks include, but are not limited to: (a) the outcome of
pending and future claims and litigation could have a material
adverse impact on the Company's business, financial condition and
results of operations; (b) on February 19,
2015, the Company was charged with one count of corruption
under the Corruption of Foreign Public Officials Act (Canada) (the "CFPOA") and one count of fraud
under the Criminal Code (Canada),
and is also subject to other ongoing investigations which could
subject the Company to criminal and administrative enforcement
actions, civil actions and sanctions, fines and other penalties,
some of which may be significant. These charges and investigations,
and potential results thereof, could harm the Company's reputation,
result in suspension, prohibition or debarment of the Company from
participating in certain projects, reduce its revenues and net
income and adversely affect its business; (c) further
regulatory developments could have a significant adverse impact on
the Company's results, and employee, agent or partner misconduct or
failure to comply with anti-bribery and other government laws and
regulations could harm the Company's reputation, reduce its
revenues and net income, and subject the Company to criminal and
administrative enforcement actions and civil actions; (d) a
negative impact on the Company's public image could influence its
ability to obtain future projects; (e) fixed-price contracts or the
Company's failure to meet contractual schedule or performance
requirements or to execute projects efficiently may increase the
volatility and unpredictability of its revenue and profitability;
(f) the Company's revenue and profitability are largely dependent
on the awarding of new contracts, which it does not directly
control, and the uncertainty of contract award timing could have an
adverse effect on the Company's ability to match its workforce size
with its contract needs; (g) the Company's remaining performance
obligations are subject to unexpected adjustments and
cancellations, including under "termination for convenience"
provisions, and does not represent a guarantee of the Company's
future revenues or profitability; (h) SNC-Lavalin is a provider of
services to government agencies and is exposed to risks associated
with government contracting; (i) the Company's international
operations are exposed to various risks and uncertainties,
including unfavourable political environments, weak foreign
economies and the exposure to foreign currency risk; (j) there are
risks associated with the Company's ownership interests in Capital
investments that could adversely affect it; (k) the Company is
dependent on third parties to complete many of its contracts; (l)
the Company's use of joint ventures and partnerships exposes it to
risks and uncertainties, many of which are outside of the Company's
control; (m) the competitive nature of the markets in which the
Company does business could adversely affect it; (n) the Company's
project execution activities may result in professional liability
or liability for faulty services; (o) the Company could be subject
to monetary damages and penalties in connection with professional
and engineering reports and opinions that it provides; (p) the
Company may not have in place sufficient insurance coverage to
satisfy its needs; (q) the Company's employees work on projects
that are inherently dangerous and a failure to maintain a safe work
site could result in significant losses and/or an inability to
obtain future projects; (r) the Company's failure to attract and
retain qualified personnel could have an adverse effect on its
activities; (s) work stoppages, union negotiations and other labour
matters could adversely affect the Company; (t) the Company relies
on information systems and data in its operations. Failure in the
availability or security of the Company's information systems or in
data security could adversely affect its business, financial
condition and results of operations; (u) any acquisition or other
investment may present risks or uncertainties; (v) divestitures and
the sale of significant assets may present risks or uncertainties;
(w) increased indebtedness as a result of the Atkins Acquisition; *
dependence on subsidiaries to help repay indebtedness as a result
of the Atkins Acquisition; (y) security under the SNC-Lavalin
Highway Holdings Loan being called at an inopportune time; (z)
ability to pay dividends; (aa) Atkins' pension-related obligations;
(bb) a deterioration or weakening of the Company's financial
position could have a material adverse effect on its business and
results of operations; (cc) the Company may have significant
working capital requirements, which if unfunded could negatively
impact its business, financial condition and cash flows; (dd) an
inability of SNC-Lavalin's clients to fulfill their obligations on
a timely basis could adversely affect the Company; (ee) the Company
may be required to impair certain of its goodwill, and it may also
be required to write down or write off the value of certain of its
assets and investments, either of which could have a material
adverse impact on the Company's results of operations and financial
condition; (ff) global economic conditions could affect the
Company's client base, partners, subcontractors and suppliers and
could materially affect its remaining performance obligations,
revenues, net income and ability to secure and maintain financing;
(gg) fluctuations in commodity prices may affect clients'
investment decisions and therefore subject the Company to risks of
cancellation, delays in existing work, or changes in the timing and
funding of new awards, and may affect the costs of the Company's
projects; (hh) inherent limitations to the Company's control
framework could result in a material misstatement of financial
information; and (ii) environmental laws and regulations expose the
Company to certain risks, could increase costs and liabilities and
impact demand for the Company's services. The Company cautions that
the foregoing list of factors is not exhaustive. For more
information on risks and uncertainties, and assumptions that could
cause the Company's actual results to differ from current
expectations, please refer to the sections "Risks and
Uncertainties", "How We Analyze and Report Our Results" and
"Critical Accounting Judgments and Key Sources of Estimation
Uncertainty" in the Company's 2017 MD&A and as updated in the
first, second and third quarter 2018 MD&A.
The forward-looking statements herein reflect the Company's
expectations as at the date of this press release and are subject
to change after this date. The Company does not undertake to update
publicly or to revise any such forward-looking statements, whether
as a result of new information, future events or otherwise, unless
required by applicable legislation or regulation.
SNC-Lavalin's Consolidated Financial Statements and
Management's Discussion and Analysis and other relevant financial
materials are available in the Investors section of the Company's
website at www.snclavalin.com. These and other
Company reports are also available on the website maintained by the
Canadian Securities regulators at
www.sedar.com.
SOURCE SNC-Lavalin