DE:CC - Decisive Dividend Corporation Reports Financial Results for the Fourth Quarter and Year Ended December 31 2021

March, 24 2022 07:55 PM Decisive Dividend Corporation

(TheNewswire)

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March 24, 2022 – TheNewswire - Kelowna, British Columbia: Decisive Dividend Corporation (TSXV:DE) (the “Company” or “Decisive”) today reported its financial resultsfor the fourth quarter and year ended December 31, 2021 .

Highlights of the Company’s financial performanceinclude the following:

Record quarterly sales in Q4, which increased 21% to$17.9 million, compared to $14.8 million in Q4 2020.
Record annual sales in fiscal 2021, which increased 29%to $62.5 million, compared to $48.5 million in 2020.
Generated $2.1 million inAdjusted EBITDA* in Q4 2021, an increase of 5% relative to Q4 2020 . Excludinggovernment subsidies, Q4 2021 Adjusted EBITDA* was 60% higher than Q42020.
Annual Adjusted EBITDA* of $8.7 million representsa 7% increase compared to 2020. Excluding subsidies, 2021 AdjustedEBITDA* was 26% higher than 2020 .
Generated profit of $0.9 million, or $0.08 per share,in Q4 2021 bringing fiscal 2021 profit to $2.3 million, or $0.19 pershare; both considerable increases compared to the losses generated inthe same respective periods in 2020.

Selected FinancialHighlights:

The following are selected financial highlights ofDecisive for the year ended December 31, 2021 . All amounts areexpressed in Canadian dollars. The Company’s consolidated financial statements as well as itsmanagement’s discussion and analysis (“MD&A”) are posted on SEDAR and on Decisive’s website ( www.decisivedividend.com ).

(Stated in thousands of dollars, except per share amounts)

















For the three months ended

For the year ended
December 31,

2021


2020

Change


2021


2020

Change
















Sales
$
17,852

$
14,815

20%

$
62,491

$
48,457

29%
Gross profit

5,843


4,365

34%


21,376


18,422

16%
Gross profit %

33%


29%




34%


38%


Adjusted EBITDA*

2,091


1,985

5%


8,657


8,061

7%
Per share basic

0.17


0.17

2%


0.73


0.70

4%
Profit (loss) before tax

985


(11)

nm


2,940


(161)

nm
Profit (loss)

918


(26)

nm


2,282


(736)

nm
Per share basic

0.08


-

100%


0.19


(0.06)

nm
Per share diluted

0.07


n/a

nm


0.18


n/a

nm
Dividends declared

906


-

100%


2,461


1,037

137%
Per share basic

0.08


-

100%


0.21


0.09

131%

* Adjusted EBITDA is not a recognized financialmeasure under International Financial Reporting Standards (IFRS) andtherefore may not be comparable to similar measures presented by otherissuers, but it is used by management to assess the performance of theCompany and its segments. See”Non-IFRS Financial Measures” later in this press release for thefull description of Adjusted EBITDA and a reconciliation of applicableIFRS measures to non-IFRS measures.

nm – not meaningful

Q4 2021 Highlights:

Consolidated sales increased 21% to $17.9 millioncompared to $14.8 million in Q4 2020.
Consolidated gross profit increased 34% to $5.8 million from $4.4 million in Q42020. Excluding subsidies, Q4 2021 gross profit was 49% higherthan Q4 2020
Consolidated gross profit percentages increased to 33%from 30% in Q4 2020
Consolidated Adjusted EBITDA* increased to $2.1 million,up 5 % relative to Q4 2020 .Excluding subsidies, Q4 2021 Adjusted EBITDA* was 60% higher than Q4 2020
Blaze King’s robust performance continued in thequarter, with sales consistent with its strong Q4 2020.
Slimline’s agricultural sprayerand parts divisions showed strong demand in the quarter evidenced by a 35% increase in the number of agricultural sprayers sold relative to Q4 2020
Hawk, Unicast and Northside each experienced dramatic increases in customer demand relativeto Q4 2020 which led to a42% increase in sales for the component manufacturing segment
The Company’s subsidiaries did not receiveany subsidies from the Canada Emergency Wage Subsidy (“CEWS”) or CanadaEmergency Rent Subsidy (“CERS”) programs inthe quarter ( Q4 2020 -$0.7 million).
Consolidated net profit in thequarter was $0.9 million, or $0.08 per share, an increase of $0.9 million, or $0.08 per share, compared to Q4 2020.

2021 AnnualHighlights:

Consolidated sales increased 29% to $62.5 million,compared to $48.5 million in
Consolidated gross profit increased 16% to $21.4million from $18.4 million in 2020. Excludingsubsidies, 2021 grossprofit was 19% higher than in 2020
Consolidated gross profit percentages declined to 34%from 38% in 2020 . The decline in gross profitpercentages was driven by a change in sales mix relative to 2020, alower exchange rate on United States dollar denominated sales, andsupply chain and labour availability challenges, which resulted inmaterial, freight, and labour cost increases.
Consolidated Adjusted EBITDA* increased to $8.7 million,up 7 % relative to 2020, driven by the above noted increases in sales and grossprofit . Excludingsubsidies, 2021 AdjustedEBITDA* was 26% higher than in 2020.
Sales in the finished product segment increased by $5.3million, or 20%, relative to 2020, driven bystrong demand for Blaze King’s products andits increased market share after new EPAregulations took effect in May 2020
Sales for the component manufacturing segment increasedby $8.7 million, or 41%, relative to 2020 based on customer demandincreases driven by improving fundamentals in the sectors that thosecustomers operate in.
The Company’s subsidiaries received $2.7million in subsidies from the CEWS, CERS andpaycheck protection programs in 2021 (2020 -$3.3 million)
Consolidated net profit in 2021was $2.3 million, or $0.19 per share, an increase of $3.0 million, or$0.25 per share, compared to 2020. The net loss in 2020 included a $1.4 million non-cash impairment loss recordedagainst Hawk’s goodwill

Jeff Schellenberg , ChiefExecutive Officer of Decisive, noted:

“ Q4 performance continued to demonstratestrong demand across our portfolio of companies. We are particularlypleased with our Adjusted EBITDA performance given current supplychain challenges. These results demonstrate the resilience of ourdiversified business model and reflect the efforts of oursubsidiaries’ management teams to manage costs and optimizeoperations in a challenging market. We are also optimistic withrespect to 2022 given the demand trends seem to be continuing andcommodity prices continue to create tailwinds for our portfoliobusinesses.

We believe we are well positioned todrive forward our buy, build and hold business model and are continuing to work towards completing our next acquisition from ourhealthy, and growing, pipeline of potential targets. We look forwardto providing further updates to our shareholders as we progress onthis front . ”

Outlook :

Building a strong and growing acquisition prospectpipeline by identifying and evaluating potential acquisitions tobolster diversity and add strength and resilience tooperations.
Enhancing balance sheet strength and flexibility, wellpositioning the Company to take advantage of potential acquisitionopportunities as they arise.
Experiencing strong demand acrossour portfolio of businesses, which trends lookto be continuing through
Optimizing our operations, with an emphasis onenhancing margins in the face of broad and steady customer demandtrends.
Stabilizing overall profitability performance through avolatile economic environment as a result of the diversity of theportfolio
Experiencing supply chain and labour availabilitychallenges to varying degrees in each portfolio business but havingsome success in passing cost increases on to customers.
Increasing production capacity and improvingoperational efficiency, with $1.5 million of manufacturing equipmentpurchased in 2021, the majority of which was deployed at Blaze King.

AboutDecisive Dividend Corporation

Decisive Dividend Corporation is anacquisition-oriented company, focused on opportunities inmanufacturing. The Company’s purpose is to be the sought-out choicefor exiting legacy-minded business owners, while supporting thelong-term success of the businesses acquired, and through that,creating sustainable and growing shareholder returns. The Company usesa disciplined acquisition strategy to identify already profitable, well- established , high qualitymanufacturing companies that have a sustainable competitive advantage, a focus onnon-discretionary products, steady cash flows,growth potential and established, strong leadership.

For more information on Decisive, or to sign up foremail notifications of Company press releases, please visit www.decisivedividend.com .

FOR FURTHER INFORMATION PLEASE CONTACT:

Jeff Schellenberg, Chief Executive Officer

Rick Torriero, Chief Financial Officer

#201, 1674 Bertram Street

Kelowna, BC V1Y 9G4

Telephone: (250) 870-9146

Cautionary Statements

Neither TSX Venture Exchange nor itsRegulation Services Provider (as that term is defined in policies ofthe TSX Venture Exchange) accepts responsibility for the adequacy oraccuracy of this release.

Non-IFRS FinancialMeasures

In this press release, reference ismade to “Adjusted EBITDA”, which is not a recognized financialmeasure under IFRS, but is believed to be meaningful in the assessmentof the Company’s performance.

“Adjusted EBITDA” is defined asearnings before finance costs, income taxes, depreciation,amortization, foreign exchange gains or losses, other non-cash itemssuch as gains or losses recognized on the fair value of contingentconsideration items, asset impairment, share-based compensation, andrestructuring costs, and other non-operating items such as acquisitioncosts.

Adjusted EBITDA is a financialperformance measure that management believes is useful for investorsto analyze the results of the Company’s operating activities priorto consideration of how those activities are financed and the impactof non-operating charges related to planned or completed acquisitions,foreign exchange, taxation, depreciation, amortization, and impairmentcharges.

The most directly comparablefinancial measure is profit or loss. While Adjusted EBITDA is used bymanagement to assess the historical financial performance of theCompany, readers are cautioned that:

Non- IFRS financial measures, such as Adjusted EBITDA, are not recognized financial measures under IFRS
The Company’s method ofcalculating Non- IFRS financial measures, such as Adjusted EBITDA, may differ fromthat of other corporation s or entities and therefore may not bedirectly comparable to measures utilized by other corporations orentities;
Non- IFRS financial measures, such as AdjustedEBITDA, should not be viewed as an alternative to measures that arerecognized under IFRS such as profit or loss or cash from operatingactivities; and

A reader should not place unduereliance on any Non- IFRS financial measures.

Set forth below are reconciliationsof Non-IFRS financial measures to their most relevant IFRSmeasures.

(Stated in thousands of dollars)












For the three months ended

For the year ended
December 31,

2021


2020


2021


2020












Profit (loss) for the period
$
918

$
(26)

$
2,282

$
(736)












Add (deduct):











Financing costs

497


549


2,079


2,189
Income tax expense

67


17


658


575
Amortization and depreciation

976


990


3,666


3,905
Acquisition costs

115


-


115


-
Goodwill impairment losses

-


-


-


1,368
Inventory fair value adjustments and write downs

27


586


27


586
Share-based compensation expense

16


55


256


442
Foreign exchange expense (income)

(66)


421


54


424
Interest and other income

(404)


(607)


(408)


(621)
Gain on sale of equipment

(55)


-


(72)


(71)












Adjusted EBITDA

2,091


1,985


8,657


8,061

Forward- Looking Statements

Certain statements contained in this press release constituteforward-looking information. These statements relate to future eventsor future performance. The use of any of the words “could”,“intend”, “expect”, “believe”, “will”,“projected”, “estimated” and similar expressions andstatements relating to matters that are not historical facts areintended to identify forward-looking information and are based onmanagement’s current beliefs, assumptions and expectations as to theoutcome and timing of such future events. Actual future results maydiffer materially. In particular, this press release containsforward-looking information relating to the future prospects of the Company and itsoperating subsidiaries, 2022 demand levels and commodity pricingtrends, increasing demand from customers, potential futureacquisitions, and potential future capital expenditures surroundingproductivity and automation initiatives being explored . Risk factors that could cause actualresults or outcomes to differ materially from the results expressed or implied byforward-looking information include, among other things: generaleconomic conditions; pandemics; competition; government regulation;environmental regulation; access to capital; market trends andinnovation; climate risk; general uninsured losses; risk related toacquisitions; dependence on customers, distributors and strategicrelationships; supply and cost of raw materials and purchased parts;operational performance and growth; implementation of the growthstrategy; product liability and warranty claims; litigation; relianceon technology, intellectual property, and information systems;availability of future financing; interest rates and debt financing;income tax matters; foreign exchange; dividends; trading volatility ofcommon shares; dilution risk; reliance on management and keypersonnel; employee and labour relations; and conflicts of interest,all as more particularly described in the most recent annual MD&Aof the Company available on the Company’s profile at www.sedar.com. There can be no assurance asto the future financial performance of the Company or that the boardof directors of the Company will declare or pay any dividends in the future or, if dividends aredeclared and paid, there can be no assurance as to the frequency oramount of such dividends . The Company cautions thereader that the risk factors referenced above are not exhaustive. Theforward-looking information contained in this release is made as ofthe date hereof and the Company is not obligated to update or reviseany forward-looking information, whether as a result of newinformation, future events or otherwise, except as required byapplicable securities laws. Because of the risks, uncertainties andassumptions contained herein, investors should not place unduereliance on forward-looking information. The foregoing statementsexpressly qualify any forward-looking information containedherein .

Not for distribution in theUnited States

This press release is not fordistribution to U.S. Newswire Services or for dissemination in theUnited States.