Andlauer Healthcare Group Reports 2019 Fourth Quarter and Full Year Results

March 12, 2020

TORONTO, March 12, 2020 /CNW/ – Andlauer Healthcare Group Inc. (TSX: AND) (“AHG” or the “Company”) today reported its financial results for the three-month period (“Q4 2019”) and year ended December 31, 2019.

Q4 2019 Highlights

  • Revenue increased 6.3% to $76.6 million, compared to $72.1 in the fourth quarter of 2018 (“Q4 2018”);
  • Operating income increased 31.4% to $11.3 million, compared to $8.6 million in Q4 2018;
  • Net income and comprehensive income increased 19.5% to $7.1 million, compared to $5.9 million in Q4 2018;
  • EBITDA(1) increased 19.4% to $17.7 million, compared to $14.9 million in Q4 2018;
  • EBITDA margin(1) increased to 23.1% from 20.6% in Q4 2018;
  • AHG completed the construction of its new Calgary facilities, expanding its logistics and distribution footprint by 23,000 square feet and increasing capacity in its specialty transportation segment;
  • AHG secured a lease on a new 220,000 square-foot facility (commencing July 1, 2020) in the GTA to service a major new client and to add capacity for future growth; and
  • AHG successfully completed its $172.5 million initial public offering of subordinate voting shares and commenced trading on the Toronto Stock Exchange.

Fiscal 2019 Highlights

  • Revenue increased 4.7% to $290.0 million, compared to $277.0 million in 2018;
  • Operating income increased 10.1% to $45.0 million, compared to $40.9 million in 2018;
  • Net income and comprehensive income increased 7.7% to $30.3 million, from $28.2 million in 2018;
  • EBITDA(1) increased 9.6% to $70.6 million, compared to $64.4 million in 2018; and
  • EBITDA margin(1) increased to 24.3% from 23.2% in 2018.

“Our fourth quarter and full year results demonstrate our continued success in generating growth by leveraging our unique set of competitive strengths and national platform to provide specialized supply-chain solutions to the growing healthcare industry in Canada,” said Michael Andlauer, Chief Executive Officer of AHG. “Our successful initial public offering at 2019 year-end has positioned us well to advance our three-part growth strategy to further strengthen our market-leading position. We intend to strengthen our clients’ connection to our platform by broadening our service offering, increase our capacity to attract both new clients and new business, and expand the platform through acquisitions.”

Selected Consolidated Financial Summary

Three Months Ended

Year Ended

($CAD 000s)

December 31,

December 31,








     Logistics & Distribution














Healthcare Logistics Segment







     Ground Transportation







     Air Freight Forwarding







     Dedicated and Last Mile Delivery







     Intersegment Eliminations







Specialized Transportation Segment







Total revenue







Operating expenses







Operating income







Net income and comprehensive income







Select financial metrics








     EBITDA Margin(1)



250 bps



110 bps

Q4 2019 Financial Results

Revenue for Q4 2019 increased by 6.3% to $76.6 million, compared with Q4 2018. Revenue growth was led by continued volume growth in ground transportation and by new contracts in logistics and distribution and dedicated and last mile delivery, resulting in approximately $4.5 million of incremental revenue. The 10.3% decline in packaging revenue in Q4 2019 was attributable to the Company’s largest packaging client’s deferral of certain projects until the first quarter of 2020.

Cost of Transportation and Services for Q4 2019 was $32.6 million, or 42.6% of revenue, compared with $31.4 million, or 43.5% of revenue, for Q4 2018. The cost of transportation and services operating ratios for both periods are in line with prior years with no major fluctuations in costs versus revenue.

Direct Operating Expenses for Q4 2019 were $18.6 million, or 24.3% of revenue, compared with $19.2 million, or 26.7% of revenue, for Q4 2018. During Q4 2019, AHG incurred increased direct operating expenses as it expanded its ATS branch capacity in Calgary, Alberta and relocated its Accuristix distribution centre to a new and larger facility in Calgary. These additional expenses were offset by improved efficiencies and the recovery of costs in connection with AHG’s Calgary relocation from logistics and distribution clients.

Selling, General and Administrative (“SG&A”) expenses for Q4 2019 were $7.5 million, or 9.8% of revenue, compared with $6.7 million, or 9.3% of revenue, for Q4 2018. SG&A expenses in Q4 2019 include initial public offering transaction costs of approximately $1.0 million, or 1.2% of revenue. A further $1.4 million, or 1.8% of revenue, was expensed in connection with the Company’s share-based payment arrangements. The Company expects approximately $2.0 million of incremental annual costs to be incurred as a result of being a public company in 2020 and each year thereafter, as compared to its prior costs as a private company.

Operating Income for Q4 2019 increased by 31.4% to $11.3 million, compared with $8.6 million for Q4 2018. The increase was primarily attributable to growth in revenue and improved operating efficiencies. Net Income and comprehensive income for Q4 2019 increased by 19.5% to $7.1 million, from $5.9 million in Q4 2018.

Earnings before interest, taxes, depreciation and amortization (“EBITDA”)¹ for Q4 2019 increased by 19.4% to $17.7 million, from $14.9 million for Q4 2018. EBITDA margin¹ for Q4 2019 improved to 23.1% from 20.6% for Q4 2018. Operating leverage was created for Q4 2019 versus the prior year as increases in the Company’s two most significant operating costs (cost of transportation and services, and direct operating expenses) were lower than the increases in revenue growth.

2019 Financial Results

Revenue for 2019 increased 4.7% to $290.0 million, compared with 2018. The increase was primarily attributable to volume growth and price increases in ground transportation, new contracts in logistics and distribution, and higher project volumes in packaging. All product lines demonstrated year-on-year growth for 2019.

Operating expenses for 2019 totaled $245.0 million, an increase of 3.7% compared with 2018. The increase in operating expenses was primarily attributable to increases in: SG&A expenses (including initial public offering transaction costs and share-based payment arrangements), cost of transportation and services, and depreciation and amortization expenses, in line with the Company’s growth. These cost increases were partially offset by a decline in direct operating expenses reflecting improved efficiencies through productivity gains and revenue growth, and increased capacity utilization of the Company’s branch facilities.

Operating income for 2019 totaled $45.0 million, an increase of 10.1% compared with 2018.  Net Income and comprehensive income for 2019 increased by 7.7% to $30.3 million, from $28.2 million in 2018. Operating income and net income increased over the prior year due to the factors discussed above.


The Board of Directors today approved the payment of the Company’s 2020 first quarter shareholder dividend (encompassing the period from December 11, 2019, the closing date of the Company’s initial public offering, to March 31, 2020) of $0.06087 per subordinate voting share and multiple voting share. Payment will be made on April 15, 2020 to shareholders of record as at March 31, 2020. The dividend to be paid to the holders of subordinate voting shares is designated as an “eligible dividend” for Canadian income tax purposes and the Company expects that, until further notice, all such future dividends will be designated as “eligible dividends” for Canadian income tax purposes.

Shares Outstanding

As at December 31, 2019, there were 12,500,000 subordinate voting shares and 25,100,000 multiple voting shares outstanding.

Financial Statements

AHG’s audited consolidated financial statements and related Management’s Discussion & Analysis (“MD&A”) for the year ended December 31, 2019 are available on the Company’s website at and on the Company’s profile on SEDAR at

Conference call

Michael Andlauer, Chief Executive Officer, and Peter Bromley, Chief Financial Officer, will host a conference call for analysts and investors on Friday, March 13, 2020 at 8:30 a.m. (ET). The dial-in numbers for the conference call are (416) 764-8650 or 1-888-664-6383. A live webcast of the call is available at:

To listen to a replay of the conference call, dial (416) 764-8677 or (888) 390-0541, passcode: 361031 #. The replay will be available until March 20, 2020. The webcast will be archived on the Company’s website following conclusion of the call.

About AHG

AHG is a leading and growing supply chain management company offering a robust platform of customized third-party logistics (“3PL”) and specialized transportation solutions for the healthcare sector. The Company’s 3PL services include customized logistics, distribution and packaging solutions for healthcare manufacturers across Canada. AHG’s specialized transportation services, including air freight forwarding, ground transportation, dedicated delivery and last mile services, provide a one-stop shop for clients’ healthcare transportation needs. Through its complementary service offerings, available across a coast-to-coast distribution network, the Company strives to accommodate the full range of its clients’ specialized supply chain needs on an integrated and efficient basis. For more information on AHG, please visit:

Forward-looking Information

This news release contains forward-looking information and forward-looking statements (collectively, “forward-looking information”) within the meaning of applicable securities laws. Forward-looking information may relate to the Company’s future financial outlook and anticipated events or results and may include information regarding the Company’s financial position, business strategy, growth strategies, addressable markets, budgets, operations, financial results, taxes, dividend policy, plans and objectives. Particularly, information regarding the Company’s expectations of future results, performance, achievements, facility expansions, leases, platform expansions, acquisitions, public company costs, payment of dividends, prospects, financial targets or outlook, intentions or opportunities is forward-looking information. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “targets”, “expects”, “budget”, “scheduled”, “estimates”, “outlook”, “forecasts”, “projection”, “prospects”, “strategy”, “intends”, “anticipates”, “believes”, “commencing” or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might”,  “will”, “will be taken”, “occur” or “be achieved” . In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information. Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events or circumstances. Such forward-looking statements are qualified in their entirety by the inherent risks, uncertainties and changes in circumstances surrounding future expectations which are difficult to predict and many of which are beyond the control of the Company.

Forward-looking information is necessarily based on a number of opinions, estimates and assumptions, including but not limited to those assumptions described under the heading “Cautionary Note Regarding Forward-Looking Information” in the MD&A for the year ended December 31, 2019. Forward-looking information is subject to known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to factors discussed under the heading “Risk Factors” in the Company’s annual information form dated March 12, 2020, which is available, together with the MD&A, on the Company’s profile on SEDAR at If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. Accordingly, investors should not place undue reliance on forward-looking information, which speaks only as of the date made. The forward-looking information contained in this news release represents the Company’s expectations as of the date of this news release, and are subject to change after such date and the Company disclaims any intention or obligation or undertaking to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required under applicable securities laws.

(1) Non-IFRS Financial Measures

This news release contains certain non-IFRS measures. These measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS. AHG uses non-IFRS measures including “EBITDA”, “EBITDA Margin”, “EBITDA less Leases and CAPEX” and “EBITDA less Leases and CAPEX Conversion” and “EBITDA less Leases and CAPEX Margin”. These non-IFRS measures are used to provide investors with supplemental measures of the Company’s operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. AHG also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. AHG management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and to determine components of management compensation.


AHG defines EBITDA as net income (loss) and comprehensive income (loss) for the period before: (i) income tax (recovery) expense; (ii) interest income; (iii) interest expense; and (iv) depreciation and amortization.

AHG believes EBITDA is a useful measure to assess the Company’s financial performance because it provides a more relevant picture of operating results by excluding the effects of expenses that are not reflective of the Company’s underlying business performance.


AHG defines EBITDA Margin as EBITDA divided by revenue. EBITDA Margin represents a measure of the Company’s profitability expressed as a percentage of revenue.

AHG believes EBITDA Margin is a useful measure to assess the Company’s financial performance because it helps quantify the Company’s ability to convert revenues generated from clients into EBITDA.

For a description of how AHG defines the other non-IFRS Measures it uses and an explanation of why the non-IFRS measures provide useful information to investors, please see “How We Assess the Performance of Our Business – Non-IFRS Measures” in the Company’s MD&A for the year ended December 31, 2019, available on the Company’s profile on SEDAR (, or the Company’s website (

For quantitative reconciliations of net income and comprehensive income to EBITDA and EBITDA less Leases and CAPEX for Q4 2019 and Q4 2018; and the years ended December 31, 2019 and 2018, please see “Reconciliation of Non-IFRS Measures” in the Company’s MD&A for the year ended December 31, 2019, available on the Company’s profile on SEDAR (, or the Company’s website (  

SOURCE Andlauer Healthcare Group Inc.

For further information: Peter Bromley, Chief Financial Officer, Tel: (416) 744-4900; Bruce Wigle, Investor Relations, Tel: (647) 496-7856