Andlauer Healthcare Group Reports Third Quarter 2021 Results

November 10, 2021

TORONTO, Nov. 10, 2021 /CNW/ – Andlauer Healthcare Group Inc. (TSX: AND) (“AHG” or the “Company”) today reported its financial results for the three and nine-month periods ended September 30, 2021 (“Q3 2021” and “YTD 2021”, respectively).

Q3 2021 Summary

  • Revenue increased 37.5% to $104.2 million, compared to $75.8 million in the three months ended September 30, 2020 (“Q3 2020”);
  • Operating income increased 27.6% to $16.8 million, compared to $13.2 million in Q3 2020;
  • Net income and comprehensive income increased 41.8% to $12.2 million, compared to $8.6 million in Q3 2020;
  • EBITDA increased 38.8% to $28.0 million, compared to $20.2 million in Q3 2020;
  • EBITDA Margin was 26.9%, compared to 26.6% in Q3 2020;
  • AHG continued to provide logistics and distribution, specialized transportation, and packaging solutions to certain of its manufacturer, 3PL provider, wholesaler and government clients that are involved in the Canadian supply of COVID-19 vaccines and ancillary products. In Q3 2021, the Company’s COVID-19 vaccine-related revenue comprised approximately 2.5% of total revenue compared with approximately 5.0% in the three months ended June 30, 2021.
  • AHG continued to maintain service levels across its operations, while monitoring the safety measures implemented in response to COVID-19 to prioritize the health and safety of its personnel, clients, and suppliers; and

Subsequent Events

  • On October 26, 2021, together with Andlauer Management Group Inc. (the “Selling Shareholder”), AHG completed a bought deal offering of 3.5 million subordinate voting shares at a price of $48.20 per subordinate voting share for aggregate gross proceeds of $168.7 million (the “Offering”). The Offering was comprised of 2.0 million subordinate voting shares issued from treasury and offered by AHG for gross proceeds of $96.4 million, and 1.5 million subordinate voting shares offered by the Selling Shareholder, for gross proceeds to the Selling Shareholder of $72.3 million. AHG used proceeds from the treasury offering to pay the cash portion of the purchase price payable in connection with the acquisitions of T.F. Boyle Transportation, Inc. (“Boyle Transportation”) and the remaining 51% of Skelton USA Inc. (“Skelton USA“) discussed further below; and
  • On November 1, 2021, AHG completed the acquisitions of Boyle Transportation and 51% of Skelton USA, increasing its aggregate ownership of Skelton USA to 100%. The purchase price for Boyle Transportation was approximately US$80 million (subject to customary purchase price adjustments) and was satisfied through the issuance of 522,116 subordinate voting shares and cash of approximately US$60 million. The purchase price for the remaining 51% interest in Skelton USA was approximately $50 million and was satisfied through the issuance of 518,672 subordinate voting shares and cash of approximately $25 million.

“Our strong momentum in the first half of the year was sustained throughout the third quarter, reflecting both organic growth and acquisitions. We generated strong revenue growth across each of our product lines, with particularly robust performance in ground transportation and dedicated and last mile delivery, where revenues increased 41.5% and 110.0% respectively,” said Michael Andlauer, Chief Executive Officer of AHG. “With our recent acquisitions of Boyle Transportation and the remaining 51% of Skelton USA, we have now established a U.S. platform with scale. In combination with our Canadian platform, we are now positioned to generate enhanced returns over the long term.”

Selected Consolidated Financial Summary

Three  months
ended Sept. 30,

Nine months
ended Sept. 30,

($CAD 000s, except per share amounts)








Logistics & distribution



12.7 %



20.9 %

Packaging solutions



5.7 %



1.7 %

Healthcare Logistics segment



11.7 %



17.5 %

Ground transportation



41.5 %



37.1 %

Air freight forwarding



7.3 %



17.1 %

Dedicated and last mile delivery



110.0 %



101.8 %

Intersegment revenue



3.6 %



24.3 %

Specialized Transportation segment



54.2 %



45.5 %

Total revenue



37.5 %



34.9 %

Operating expenses



39.5 %



33.4 %

Operating income



27.6 %



42.5 %

Net income and comprehensive income



41.8 %



54.5 %

Earnings per share – basic

$ 0.32

$ 0.23

$ 0.09

$ 0.96

$ 0.63

$ 0.33

Earnings per share – diluted

$ 0.31

$ 0.22

$ 0.09

$ 0.94

$ 0.62

$ 0.32

Select financial metrics




38.8 %



46.6 %

EBITDA Margin¹

26.9 %

26.6 %

30 bps

27.2 %

25.0 %

220 bps

Q3 2021 Financial Results

Revenue for Q3 2021 increased by 37.5% to $104.2 million, compared with $75.8 million in Q3 2020. The TDS Logistics Inc. (“TDS”), McAllister Courier Inc. (“MCI”) and Skelton Canada Inc. (“Skelton Canada”) acquisitions accounted for approximately $18.2 million of the $28.4 million increase, with the remaining increase attributable to organic growth as described below.

Revenue for the healthcare logistics segment totaled $33.5 million, an increase of 11.7% compared with Q3 2020. The increase was primarily attributable to the 12.7% year-over-year growth in the Company’s logistics and distribution product line in Q3 2021, generated from greater inbound product volume, storage and outbound handling activities. AHG’s packaging solutions also contributed to growth in the healthcare logistics segment, with revenue totaling $4.5 million in the quarter, an increase of 5.7% compared to Q3 2020, but remained approximately $0.2 million, or 4.2% below revenue in the third quarter of 2019.

Revenue in the specialized transportation segment totaled $70.7 million, an increase of 54.2% compared with Q3 2020. The increase was attributable to: 41.5% growth in the Company’s ground transportation product line driven by incremental revenue from the MCI and Skelton Canada acquisitions of approximately $12.3 million, higher volume from the Company’s existing client base and higher fuel costs passed on to customers as a component of pricing, and year-over-year growth in AHG’s air freight forwarding and dedicated and last mile delivery product lines of 7.3% and 110.0%, respectively. Growth in air freight forwarding was attributable to increased revenue related to higher fuel costs, as volume in Q3 2021 was consistent with Q3 2020. Growth in dedicated and last mile delivery was primarily attributable to incremental revenue of approximately $5.9 million from the acquisition of TDS, with the remainder attributable to route expansion in Western Canada and increases in fuel costs passed on to customers.

Cost of transportation and services was $47.5 million, or 45.6% of revenue, compared with $30.8 million, or 40.6% of revenue, for Q3 2020. The higher cost of transportation and services for Q3 2021 reflects an approximate 7.4%% increase in volume in AHG’s ATS Healthcare business compared to Q3 2020, the acquisitions of TDS, MCI and Skelton Canada, and higher fuel costs in line with the increases in revenue related to fuel prices. The increase in the operating ratio for Q3 2021 reflects the addition of the TDS, MCI and Skelton Canada acquisitions, which have increased the relative proportion of the specialized transportation segment as a percentage of AHG’s total consolidated revenue and cost profiles.

Direct operating expenses were $21.4 million, or 20.5% of revenue, compared with $18.0 million, or 23.7% of revenue, for Q3 2020. The increase was primarily attributable to the acquisitions of TDS, MCI and Skelton Canada, however these acquisitions – which are included in AHG’s specialized transportation segment – have lower facility-related costs compared to AHG’s healthcare logistics segment, which results in a lower direct operating expense operating ratio in Q3 2021 as compared to Q3 2020. AHG has incurred certain incremental costs in connection with its COVID-19 response measures, but these incremental costs were mitigated through effective productivity management and other cost controls.

Selling, General and Administrative (“SG&A”) expenses were $8.3 million, or 7.9% of revenue, compared with $6.8 million, or 9.0% of revenue, for Q3 2020. Increased SG&A expenses for Q3 2021 are attributable to the acquisitions of TDS, MCI and Skelton Canada, and approximately $0.3 million in professional fees related to AHG’s acquisition of Boyle Transportation, partially offset by a $0.3 million reduction in the costs attributable to share-based compensation expenses related to AHG’s initial public offering. The decrease in SG&A expenses as a percentage of revenue reflects operating leverage generated within SG&A functions compared to revenue growth.

Operating income for Q3 2021 was $16.8 million, an increase of 27.6% compared to Q3 2020, primarily reflecting the growth in total revenue.

Net income and comprehensive income increased by 41.8% to $12.2 million, or $0.31 per share (diluted), from $8.6 million, or $0.22 per share (diluted), in Q3 2020. The increase reflects higher segment net income before eliminations from both the Company’s healthcare logistics and specialized transportation operating segments, and a $1.0 million contribution from AHG’s 49% interest in Skelton USA.

Earnings before interest, taxes, depreciation and amortization (“EBITDA”)¹ increased by 38.8% to $28.0 million, from $20.2 million in Q3 2020, reflecting the factors discussed above and incremental contributions from the TDS, MCI and Skelton Canada acquisitions. EBITDA margin¹ improved to 26.9% from 26.6% in Q3 2020. The performance of AHG’s two operating segments continued to result in strong and stable EBITDA margins at the higher end of the Company’s historical range. Further, Skelton Canada’s higher margin profile has positively impacted AHG’s overall margin.


The Company paid a dividend (encompassing the period from July 1, 2021 to September 30, 2021) in the amount of $0.05 per subordinate voting share and multiple voting share on October 15, 2021.

Subject to financial results, capital requirements, available cash flow, corporate law requirements and any other factors that AHG’s Board of Directors may consider relevant, it is the Company’s intention to declare a quarterly dividend of $0.05 per subordinate voting share and multiple voting share on an ongoing basis.

Shares Outstanding

As at September 30, 2021, there were 13,379,571 subordinate voting shares and 25,100,000 multiple voting shares outstanding.

As at November 10, 2021, following the Offering and the completion of the acquisitions of Boyle Transportation and 51% of Skelton USA, there were 17,920,359 subordinate voting shares and 23,600,000 multiple voting shares outstanding.

Financial Statements

AHG’s unaudited interim condensed consolidated financial statements and related Management’s Discussion & Analysis (“MD&A”) for Q3 2021 and YTD 2021 are available on the Company’s website at and on the Company’s profile on SEDAR at

Conference call and webcast

Michael Andlauer, Chief Executive Officer, and Peter Bromley, Chief Financial Officer, will host a conference call for analysts and investors on Thursday, November 11, 2021 at 8:30 a.m. (ET). The dial-in numbers for participants are (647) 792-1240 or (888) 394-8218. The call will be webcast live at:

To access a replay of the conference call dial (647) 436-0148 or (888) 203-1112, passcode: 2719334 #. The replay will be available until November 18, 2021. 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, objectives and responses to the outbreak of COVID-19. 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, opportunities or the potential impact of, and response measures to be taken with respect to, COVID-19 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 Company’s MD&A for the three and nine-month periods ended September 30, 2021. 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 February 24, 2021, which is available 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”, and “EBITDA 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 quantitative reconciliations of net income and comprehensive income to EBITDA for Q3 2021, YTD 2021, Q3 2020 and the nine-month period ended September 30, 2020 please see “Reconciliation of Non-IFRS Measures” in the Company’s MD&A for the three and nine-month periods ended September 30, 2021, 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