Press Releases

Waterloo Brewing's annual EBITDA grows +31% to $15.2 million

Fourth Quarter Highlights:

  • Net Revenue for the quarter grew 66.9% to $24.5 million compared to $14.7 million in the prior year.
  • EBITDA* for the quarter was $3.2 million, a decline of 4%, compared to $3.4 million in the prior year.
  • Gross Profit Margin for the quarter declined by 11% to 18.1% from 29.1% in the prior year.
  • Selling, Marketing, and Administration for the quarter increased slightly to $3.0 million, compared to $2.6 million in the prior year.
  • The Board of Directors re-affirmed the quarterly dividend, at $0.0275/share, payable May 26, 2021, to shareholders of record as of May 19, 2021. The dividend is classified as an eligible dividend.

Full Year Highlights:

  • Net Revenue increased 43.7% to $86.7 million, from $60.3 million in the prior year.
  • Reported EBITDA* for the year was $15.2 million, representing a 31% increase versus the prior year's $11.6 million.
  • Gross Profit Margin declined to 23.9% compared to 29.6% in the prior year, due to global market supply and cost issues with aluminum cans, as well as temporary outsourcing measures taken to meet increased production demand prior to the completion of planned can capacity upgrades.
  • Selling, Marketing, and Administration expenses remained flat at $11.9 million from $11.8 million in the prior year.

KITCHENER, ON, April 8, 2021 /CNW/ - Waterloo Brewing Ltd. ("Waterloo Brewing" or the "Company") (TSX: WBR), Ontario's largest Canadian-owned brewery, today released results for the fourth quarter and full-year ended January 31, 2021. Waterloo Brewing posted a record annual EBITDA of $15.2 million on net revenue of $86.7 million, which represents growth of 31% and 44% respectively.

"The clear choices we made for growth are generating considerable momentum for our business," stated George Croft, President, and Chief Executive Officer, Waterloo Brewing, "Our portfolio of award-winning beers, ciders, seltzers, and coolers are focused on The Beer Store, LCBO, and grocery channels and fared very well despite the effect that pandemic control measures continue to have on pub and restaurant operators throughout the province."

"EBITDA growth of 31%, revenue growth of 44%, Laker growth at 19%, LandShark® Lager growth at 23%, Waterloo growth at 20%, outstanding new product success within the Seagram brand delivered 36% growth, all combined with a thriving co-pack business is nothing less than phenomenal performance", continued Croft. "No other brewery or beverage alcohol producer in the country has the diverse range of value-driving assets we do and is delivering the results we are. It is a formula that is paying literal dividends. "

"The trajectory of our Company is impressive and would not be possible without one of the most dedicated and hard-working team of people in the business," declared Croft. "When I reflect on this past year, I am so proud of the whole team here at Waterloo Brewing and deeply respect the contribution that each person has made to persevere and succeed against the odds. The adversity of this past year has galvanized us and emboldened us, and it feels as though there's nothing we can't accomplish together."

As part of the financing review to support the continued expansion and capital investment and the Company's year-end audit process, the Company was required to recast prior long-term debt obligations, that are due upon demand, to be presented as a current liability, as outlined in Notes 3.6 and 14 in the annual audited financial statements.  This accounting change does not impact the Company's risk profile, terms of borrowing, total debt outstanding, or debt covenants.  Accordingly, the Company has now presented the term debt as a current liability in the amount of $25.9 million in the annual audited financial statements. 

The following financial information should be read in conjunction with the audited annual financial statements of the Company prepared under IFRS for the year ended January 31, 2021.

Reconciliation of Net Earnings to EBITDA*




 Fiscal year ended 

(in thousands of dollars)

January 31, 2021

January 31, 2020




Net income

$

3,000

$

497




Add (deduct):



Income tax expense

1,254

538

Depreciation and amortization

7,811

6,334

Loss (gain) on disposal of property, plant & equipment and right-of-use assets

216

(15)

Share-based payments

792

892

Finance costs

2,107

1,501

Loss on misappropriated funds

-

1,870

Subtotal

12,180

11,120




EBITDA *

15,180

11,617

STATEMENTS OF FINANCIAL POSITION

Fiscal years ended January 31, 2021 and January 31, 2020


January 31, 2021

January 31, 2020

ASSETS


[recast]

Current assets



Accounts receivable

9,871,061

4,976,226

Inventories

14,344,496

10,482,912

Prepaid expenses

729,260

787,448


24,944,817

16,246,586

Non-current assets



Property, plant and equipment

46,630,107

32,808,678

Right-of-use assets

26,936,861

27,840,996

Intangible assets

15,002,826

15,184,333

Construction deposits

1,949,074

1,050,425


90,518,868

76,884,432

TOTAL ASSETS

115,463,685

93,131,018




LIABILITIES AND EQUITY



Current liabilities



Bank indebtedness

3,366,489

783,077

Accounts payable and accrued liabilities

21,341,335

12,909,771

Current portion of lease liabilities

3,282,080

2,869,733

Non-revolving demand loans

25,896,379

13,748,967

Current portion of long-term debt

510,275

687,836


54,396,558

30,999,384

Non-current liabilities



Provisions

1,019,962

958,025

Lease liabilities

21,522,379

23,226,137

Long-term debt 

1,367,930

1,852,023

Deferred income tax liability

3,462,495

2,208,947


27,372,766

28,245,132

TOTAL LIABILITIES

81,769,324

59,244,516

Equity



Share capital

39,546,216

39,126,283

Share-based payments reserves

2,245,415

2,108,671

Deficit

(8,097,270)

(7,348,452)

TOTAL EQUITY

33,694,361

33,886,502




COMMITMENTS









TOTAL LIABILITIES AND EQUITY

$

115,463,685

$

93,131,018

STATEMENTS OF COMPREHENSIVE INCOME

Fiscal years ended January 31, 2021 and January 31, 2020


January 31, 2021

January 31, 2020




Revenue

$

86,699,345

$

60,333,417

Cost of sales

66,000,997

42,483,862

Gross profit

20,698,348

17,849,555

Selling, marketing and administration expenses

11,853,169

11,842,088

Other expenses

2,268,499

1,616,977

Finance costs

2,107,363

1,500,682

Loss on misappropriated funds, net

-

1,869,595

Loss (gain) on disposal of property, plant and
     equipment and right-of-use assets

215,756

(15,168)

Income before tax

4,253,561

1,035,381




Income tax expense

1,253,548

537,779

Net income and comprehensive
  income for the year

$

3,000,013

$

497,602







Basic earnings per share

$

0.09

$

0.01

Diluted earnings per share

$

0.08

$

0.01

STATEMENTS OF CASH FLOWS

Fiscal years ended January 31, 2021 and January 31, 2020


 January 31, 2021 

January 31, 2020



[recast]

Operating activities



Net income

$

3,000,013

$

497,602

Adjustments for:



Income tax expense

1,253,548

537,779

Finance costs

2,107,363

1,500,682

Depreciation and amortization of property, plant and
     equipment, right-of-use assets and intangibles

7,810,676

6,334,179

Loss (gain) on disposal of property, plant and equipment and
     right-of-use assets

215,756

(15,168)

Share-based payments

792,327

892,360

Change in non-cash working capital

(442,761)

5,036,143

Less:



Interest paid

(1,859,817)

(1,373,019)

Cash provided by operating activities

12,877,105

13,410,558




Investing activities



Purchase of property, plant and equipment

(18,407,338)

(11,013,763)

Construction deposit paid

(1,949,074)

(1,050,425)

Proceeds from sale of property, plant and equipment, net

9,555

18,656

Purchase of intangible assets

(25,659)

(134,624)

Cash used in investing activities

(20,372,516)

(12,180,156)




Financing activities



Increase (decrease) in bank indebtedness

2,583,412

(1,104,176)

Issuance of non-revolving demand loans

14,505,315

7,961,780

Repayment of non-revolving demand loans

(2,357,903)

(1,292,639)

Repayment of long-term debt

(671,169)

(672,193)

Repayment of lease liabilities

(2,579,763)

(1,563,059)

Dividends paid

(3,748,831)

(3,576,462)

Issuance of shares, net of fees

29,368

96,722

Shares repurchased and cancelled, including fees

(377,058)

(1,125,484)

Stock option costs

-

(17,169)

Proceeds from stock option exercise

112,040

62,278

Cash generated from (used in) financing activities

7,495,411

(1,230,402)




Net increase/(decrease) in cash

-

-




Cash, beginning of year

-

-

Cash, end of year

$

-

$

-

Non-cash investing activities:



Acquisition of assets under lease 

$

1,311,281

$

13,822,240

About Waterloo Brewing

Waterloo Brewing is Ontario's largest Canadian-owned brewery. The Company is a regional brewer of award-winning premium quality and value beers and is officially certified under the Global Food Safety Standard, one of the highest and most internationally recognized standards for safe food production. Founded in 1984, Waterloo Brewing Ltd. (formerly Brick Brewing Co. Limited) was the first craft brewery to start up in Ontario and is credited with pioneering the present day craft brewing renaissance in Canada. Waterloo Brewing has complemented its Waterloo premium craft beers with the popular Laker brand.  In 2011, Waterloo Brewing purchased the Canadian rights to Seagram Coolers and in 2015, secured the exclusive Canadian rights to both LandShark® and Margaritaville®. In addition, Waterloo Brewing utilizes its leading-edge brewing, blending, and packaging capabilities to provide an extensive array of contract manufacturing services in beer, coolers, and ciders. Waterloo Brewing trades on the TSX under the symbol WBR. Visit us at www.WaterlooBrewing.com.

Forward-Looking Statements

All statements in this press release that do not directly and exclusively relate to historical facts constitute forward-looking statements as of the date of this press release. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "anticipate", "seek", "plan", "believe" or "continue" or the negatives of these terms or variations of them or similar terminology. Although the Company believes that the expectations and assumptions reflected in these forward-looking statements are reasonable, undue reliance should not be placed on these forward-looking statements, which are not guarantees and are subject to certain risks, uncertainties, and assumptions, which may cause actual performance and financial results to differ materially from such forward-looking statements. The forward-looking statements included in this press release are made only at the date of this press release and, except as required by applicable securities laws, the Company does not undertake to publicly update such forward-looking statements to reflect new information, future events or otherwise.

* EBITDA is a non-IFRS earnings measure, therefore it does not have any standardized meaning prescribed by International Financial Reporting Standards and may not be similar to measures presented by other companies. EBITDA represents earnings before interest, income taxes, depreciation and amortization, gain, or loss on disposal of property, plant, and equipment and right-of-use assets, share-based payments, and loss on misappropriated funds. Management uses this measurement to evaluate the operating results of the Company. This measure is also important to management since it is used by the Company's lenders to evaluate the ongoing cash-generating capability of the Company and therefore the amounts those lenders are willing to lend to the Company. Investors find EBITDA to be useful information because it provides a measure of the Company's operating performance.

Waterloo Brewing Ltd. Logo (CNW Group/Waterloo Brewing Ltd.)

SOURCE Waterloo Brewing Ltd.

For further information: David J. Birch, Chief Financial Officer, (416) 895-4824, E-mail: info@waterloobrewing.com