Logistec Corporation announced its financial results for the fourth quarter and the year ended December 31, 2015. Consolidated revenue totalled $358.0 million in 2015, an increase of $35.8 million or 11.1 per cent over 2014. Revenue was affected by the increase in the U.S. dollar against the Canadian dollar. For the year, the positive impact amounted to $15.3 million.
Activity in the marine services segment was similar to that of 2014, with a slight decrease in bulk activity, offset by an increase in break-bulk activity. The environmental services segment delivered a good performance in 2015, as revenue increased by $23.9 million or 18.7 per cent over 2014 to reach $151.5 million. Revenue growth came primarily from increased activity in Aqua-Pipe and from site remediation.
In 2015, Logistec achieved a consolidated profit for the year of $32.9 million, of which $29.1 million was attributable to owners of the Company. This is lower than the 2014 consolidated profit of $34.5 million, of which $31.0 million was attributable to owners of the Company. This decline stemmed largely from additional cargo-handling costs due to flooding at our terminal in Virginia, a fire at our terminal in Georgia, and the start-up of our new container terminal in Montréal (QC). This was partially offset by greater profitability in our environmental services segment.
During the fourth quarter of 2015, consolidated revenue totalled $92.4 million, up by $5.5 million over the same period of 2014. This increase is explained by strong activity in the marine services segment. Profit attributable to owners of the Company amounted to $7.9 million.
Outlook
Madeleine Paquin, President and CEO of Logistec Corporation offered the following assessment of Logistec’s 2016 prospects: “Our development plan is focused on strengthening and growing our footprint of cargo-handling services in North America. Over the last few years, we have succeeded in growing organically by targeting very specific growth markets, namely mining, biomass and port logistics. Unfortunately, with the significant drop in commodity prices, the landscape for mining development has been negatively affected and we need to moderate our expectations for significant growth. However, we still believe there will be opportunities, particularly in Québec, and we will seize these opportunities as they arise.
In biomass, we are rebuilding the capacity damaged by the fire in Georgia. We have also completed an expansion that will be coming on stream in the next quarter for a different customer. That will allow for some volume expansion in 2016.
Our container business should also see some growth in 2016. Although the economic environment is very difficult, with GDP growth at very low levels, we should be able to strengthen our Canadian gateway with new U.S. cargoes while also extending our geographic reach through the hub-and-spoke model of our customer, Mediterranean Shipping Company, S.A. This allows them to competitively transload cargoes between North America and the world using the Montréal (QC) and Saint John (NB) gateways.
Our port logistics business in Montréal-Est (QC) is developing well. We were able to offer transloading services within our new warehouse via rail/container/truck for the first time in 2015, and our services were well received by our customers. We expect continued growth of this business in 2016. In Virginia, flooding severely affected our business in 2015 and we are looking to diversify our customer base and develop our services, based on the success and the growth of Port of Virginia as an international container port in North America.
The difficult economic environment may also present acquisition opportunities and we are actively reaching out to companies that would fit well with our development plan. We are seeking to strengthen and expand our port network and to facilitate trade through market-driven cargo-handling opportunities in North America.
We are also committed to developing our environmental services segment. Sanexen should have another good year in 2016. The order book is strong and its two main markets, traditional environmental services and the rehabilitation of water mains, hold significant growth potential. In Canada, we are well positioned to capitalize on the aqueduct infrastructure projects that are at the heart of the government’s strategy. In the U.S., the recovery is tangible and underground infrastructure rehabilitation needs are enormous. Finally, after being established for four years in France, our activities are seeing sustained growth, particularly in regulated materials management.
Sanexen enjoys an enviable position in its main markets. To add to its service offering in 2016, we will open the first fully-enclosed contaminated soils bioremediation centre in Canada. In addition, as of March 8, 2016, the Company acquired a business for $5.6 million. This acquisition represents a vertical integration for the environmental services segment. In our Aqua-Pipe business, we expect to advance our growth in the U.S. market. Furthermore, Ventia, our licensee in Australia, will be performing its first installations in 2016. The Australian market represents a good potential due to new regulations affecting water mains made of asbestos cement. As is the case for our marine services business, we will continue to pursue growth opportunities, both internally and externally, in 2016.”
“Overall, we are committed and confident that we can continue to build our business based on the specialized services where we have developed our expertise with a solid customer base. Despite the more difficult economic environment, our service offerings, our geographic diversity, and our ability to invest in growth opportunities should allow us to continue to increase our services in both the short and long term. Clearly, our success rests on the strength of our highly dynamic team of experts who are customer oriented and consistently bring value to an expanding customer base,” concluded Madeleine Paquin.