CAMBRIDGE, Ontario--(BUSINESS WIRE)--May 28, 2026--
ATS Corporation (TSX and NYSE: ATS) ("ATS" or the "Company") today reported its financial results for the three and twelve months ended March 31, 2026. All references to "$" or "dollars" in this news release are to Canadian dollars unless otherwise indicated.
Fourth quarter highlights:
-- Revenues were $747.1 million (adjusted revenues1 $744.3 million)
compared to $574.2 million (adjusted revenues $721.1 million) a year
ago.
-- Net loss was $16.2 million compared to net loss $68.9 million a year
ago.
-- Basic loss per share were 16 cents, compared to loss per share of 70
cents a year ago.
-- Adjusted EBITDA1 was $102.5 million compared to $97.1 million a year
ago.
-- Adjusted basic earnings per share1 were 36 cents compared to 41 cents a
year ago.
-- Order Bookings2 were $704 million, compared to $863 million a year
ago.
-- Order Backlog2 was $1,958 million, compared to $2,139 million a year
ago.
"Today ATS reported fourth quarter and full-year results for fiscal 2026, with full-year revenue and adjusted earnings from operations growth of approximately 11%, reflecting solid execution across the platform," said Doug Wright, Chief Executive Officer. "In the quarter, we took decisive steps to restructure and reposition our transportation-related businesses; we are consolidating certain operations and right-sizing our facility footprint, while repositioning our engineering and automation capabilities into applications where our differentiation creates greater value and the return profile is more attractive."
Year-to-date highlights:
-- Revenues were $2,972.9 million (adjusted revenues1 $2,970.1 million)
compared to $2,533.3 million (adjusted revenues $2,680.2 million) a year
ago.
-- Net income was $71.7 million compared to a loss of $28.0 million a year
ago.
-- Basic earnings per share were 73 cents, compared to a loss of 29 cents
a year ago.
-- Adjusted EBITDA1 was $413.0 million compared to $368.9 million a year
ago.
-- Adjusted basic earnings per share1 were $1.69 compared to $1.47 a year
ago.
-- Order Bookings2 were $2,952 million, compared to $3,305 million a year
ago.
Mr. Wright added: "We closed out fiscal 2026 with leverage and working capital within target ranges, and a backlog that provides solid revenue visibility into fiscal 2027. These actions, including our reorganization initiatives, leave us better positioned as we enter the new fiscal year, with increased financial flexibility and a clear focus on margin expansion, free cash flow and disciplined capital deployment, alongside a more focused portfolio and improved cost structure."
(1) Non-IFRS measure -- See "Non-IFRS and Other Financial Measures". (2) Supplementary financial measure -- See "Non-IFRS and Other Financial Measures".
Financial results
(In millions of dollars, except per share and margin data)
Fiscal Fiscal
Q4 2026 Q4 2025 Variance 2026 2025 Variance
-------------- ------- ------- -------- -------- -------- --------
Revenues $ 747.1 $ 574.2 30.1% $2,972.9 $2,533.3 17.4%
Adjusted
revenues(1) $ 744.3 $ 721.1 3.2% $2,970.1 $2,680.2 10.8%
Net income
(loss) $(16.2) $(68.9) 76.5% $ 71.7 $ (28.0) 356.1%
-------------- ------ ------ -------- ------- ------- --------
Adjusted
earnings from
operations(1) $ 76.8 $ 74.3 3.4% $ 314.4 $ 282.6 11.3%
Adjusted
earnings from
operations
margin(2) 10.3% 10.3% 1bps 10.6% 10.5% 4bps
Adjusted
EBITDA(1) $ 102.5 $ 97.1 5.6% $ 413.0 $ 368.9 12.0%
Adjusted
EBITDA
margin(2) 13.8% 13.5% 31bps 13.9% 13.8% 14bps
-------------- ------ ------ -------- ------- ------- --------
Basic earnings
(loss) per
share $(0.16) $(0.70) 77.1% $ 0.73 $ (0.29) 351.7%
Adjusted basic
earnings per
share(1) $ 0.36 $ 0.41 (12.2)% $ 1.69 $ 1.47 15.0%
-------------- ------ ------ -------- ------- ------- --------
Order
Bookings(3) $ 704 $ 863 (18.4)% $ 2,952 $ 3,305 (10.7)%
-------------- ------ ------ -------- ------- ------- --------
March 31 March 31
As At 2026 2025 Variance
------------------- ---------------- -------------- -------------------
Order Backlog(3) $ 1,958 $ 2,139 (8.5)%
------------------- --- ----------- ---------- -------------------
(1) Non-IFRS financial measure -- See "Non-IFRS and Other Financial
Measures". (2) Non-IFRS ratio -- See "Non-IFRS and Other Financial
Measures". (3) Supplementary financial measure -- See "Non-IFRS and Other
Financial Measures".
Fourth quarter summary
Fourth quarter fiscal 2026 revenues were 30.1% or $172.9 million higher than in the corresponding period a year ago, primarily reflecting a year-over-year increase in organic revenue (excluding contributions from acquired companies and foreign exchange translation) of $10.8 million or 1.5%, in addition to the $146.9 million impact from the one-time settlement with an electric vehicle ("EV") customer in the prior year. On an adjusted basis, revenues were 3.2% or $23.2 million higher than in the corresponding period a year ago. Revenues generated from construction contracts decreased 3.4% or $13.8 million from the prior period primarily due to lower Order Backlog entering the period and was partially offset by the positive impact of foreign exchange translation. Revenues from services increased 17.2% or $27.4 million, primarily due to organic revenue growth on higher Order Backlog entering the period and the positive impact of foreign exchange translation. Revenues from the sale of goods increased 6.0% or $9.6 million primarily due to organic revenue growth on higher Order Backlog entering the period.
By market, revenues generated in life sciences decreased $38.9 million or 9.3% year over year. This was primarily due to a decrease in organic revenue growth on lower Order Backlog entering the quarter as the prior year included several large enterprise Order Bookings in life sciences. Revenues generated in consumer products increased $71.9 million or 80.6% year over year primarily due to organic revenue growth, including contributions from warehouse packaging automation projects. Revenues generated in food & beverage decreased $2.2 million or 1.9% from the corresponding period last year due to timing of customer projects. Revenues in energy increased $34.2 million or 101.5% year over year due to organic revenue growth on higher Backlog Order entering the quarter, including execution of nuclear projects. Revenues in transportation decreased $41.8 million or 61.1% year over year due to lower Order Backlog entering the quarter, as expected.
Net loss for the fourth quarter of fiscal 2026 was $16.2 million ((16) cents per share basic), compared to net loss of $68.9 million ((70) cent per share basic) for the fourth quarter of fiscal 2025. The improvement primarily reflected higher revenues, partially offset by increased SG&A. Adjusted basic earnings per share were 36 cents compared to 41 cents in the fourth quarter of fiscal 2025.
Depreciation and amortization expense was $46.8 million in the fourth quarter of fiscal 2026, compared to $38.0 million a year ago. This increase was primarily due to the services reorganization -- see "Reorganization Activity."
EBITDA was $54.9 million (7.4% EBITDA margin) in the fourth quarter of fiscal 2026 compared to $(75.6) million ((10.5)% EBITDA margin) in the fourth quarter of fiscal 2025. EBITDA for the fourth quarter of fiscal 2026 included $15.2 million of restructuring charges, $0.1 million of incremental costs related to acquisition activity, $28.3 million related to the impact of the transportation reorganization, $2.6 million related to the impact of the services reorganization, $1.3 million related to the fourth quarter of fiscal 2026 CEO inducement costs and $0.1 million of stock-based compensation revaluation expense of cash-settled awards. EBITDA for the corresponding period in the prior year included $3.5 million of restructuring charges, $0.9 million of incremental costs related to acquisition activity, $0.6 million of acquisition-related fair value adjustments to acquired inventories, $171.1 million of impact from the one-time settlement with an EV customer, and $3.4 million of recoveries of stock-based compensation revaluation expenses. Excluding these amounts, adjusted EBITDA was $102.5 million (13.8% adjusted EBITDA margin), compared to $97.1 million (13.5% adjusted EBITDA margin) for the corresponding period in the prior year. Higher adjusted EBITDA primarily reflected increased adjusted revenues, partially offset by increased SG&A.
Order Backlog Continuity
(In millions of dollars)
Q4 Fiscal Fiscal
2026 Q4 2025 2026 2025
--------------- ------ --------- ---------- ----------
Opening Order
Backlog $2,053 $ 2,060 $ 2,139 $ 1,793
Adjusted
Revenues(1) (744) (721) (2,970) (2,680)
Order Bookings 704 863 2,952 3,305
Order Backlog
adjustments(2) (55) (63) (163) (279)
--------------- ----- ----- ------ ------
Total $1,958 $ 2,139 $ 1,958 $ 2,139
--------------- ----- ----- ------ ------
(1) Non-IFRS financial measure -- see "Non-IFRS and Other
Financial Measures." (2) Order Backlog adjustments include
incremental Order Backlog of acquired companies ($12 million
acquired with Paxiom Group ("Paxiom") in the twelve months ended
March 31, 2025), foreign exchange adjustments, and normal course
scope changes and cancellations and the removal of Order Backlog
related to the Company's disagreement with one of its EV
customers in fiscal 2025.
Order Bookings
Fourth quarter of fiscal 2026 Order Bookings were $704 million, a 18.4% year-over-year decrease, reflecting a 19.3% decline in organic Order Bookings, partially offset by 0.9% from the positive impact of foreign exchange translation. By market, Order Bookings in life sciences decreased compared to the prior-year period primarily due to the timing of customer capital investment cycles. Order Bookings within life sciences in the quarter were well diversified, including orders for radiopharmaceutical applications and for medical device automation solutions outside of autoinjector (GLP-1) assembly equipment. Order Bookings in both consumer products and energy decreased from the prior period primarily due to timing of customer orders, while Order Bookings in food & beverage increased compared to the prior-year period primarily due to timing of customer orders in addition to the positive impact of foreign exchange translation.Order Bookings in transportation decreased, as expected, based on end-market capacity requirements, particularly in EV.
Trailing twelve month book-to-bill ratio at March 31, 2026 was 0.99:1 reflecting the Company's execution against a strong backlog built over the prior fiscal year, as previously secured orders converted into revenues. Order Bookings, organic Order Bookings growth and book-to-bill ratio are supplementary financial measures -- see "Non-IFRS and Other Financial Measures."
Backlog
At March 31, 2026, Order Backlog was $1,958 million, 8.5% lower than at March 31, 2025.
Outlook
The life sciences funnel remains strong and diversified, with opportunities in strategic submarkets such as pharmaceuticals, radiopharmaceuticals, and medical devices. Management continues to identify opportunities with both new and existing customers, including those who produce diagnostic and therapeutic radiopharmaceuticals, auto-injectors, wearable devices, automated pharmacy solutions, contact lenses and pre-filled syringes, as well as opportunities to provide life science solutions that leverage integrated capabilities from across ATS. ATS serves customers in laboratory research where government funding in the U.S. has been and continues to be constrained. However, management has not seen a material impact on its overall life sciences funnel activity. ATS is also advancing a coordinated go-to-market reorganization across its lab equipment businesses, with early pipeline activity building. Funnel activity in consumer products is stable, although discretionary spending by consumers, influenced by factors such as inflationary pressures, may impact timing of some customer investments in the Company's solutions. Funnel activity in food & beverage remains strong. The Company continues to benefit from strong brand recognition within global tomato processing, as well as other soft fruit and vegetable processing industries. There is continued demand for automated solutions within the food & beverage market more broadly, in areas such as secondary processing and packaging. Funnel activity in energy remains strong and includes longer-term opportunities in the nuclear industry. The Company is focused on clean energy applications including solutions for the refurbishment of nuclear power plants, early participation in the new reactor build market, including small modular reactors, and grid battery storage. In transportation, the funnel consists of opportunities reflective of current end-market capacity needs and ATS' specialized capabilities, which can support customers as opportunities arise, including automation solutions that support the assembly and testing of automotive components and systems, primarily for EV. The capabilities of the ATS businesses historically focused on transportation are expected to continue to build their unique capabilities and technologies for use in other industrial applications.
Customers seeking to de-risk or enhance supply chain resiliency, address skilled worker shortages or combat higher labour costs present ongoing and future opportunities for ATS. Management believes that the underlying trends driving customer demand for ATS solutions, including growing labour constraints, production onshoring or reshoring and the need for scalable, high-quality, energy-efficient production, remain favourable. In addition, funnel growth in markets where sustainability requirements are a focus for customers -- including nuclear and grid battery storage, as well as consumer goods packaging -- provides ATS with opportunities to use its capabilities to respond to customer needs, such as global and regional requirements to reduce carbon emissions.
Order Backlog of $1,958 million is expected to help mitigate some of the impact of quarterly variability in Order Bookings on revenues in the short term. The Company's Order Backlog includes several large enterprise programs that have longer periods of performance and therefore longer revenue recognition cycles, particularly in life sciences. In the first quarter of fiscal 2027, management expects to generate revenues in the range of $700 million to $740 million. This estimate is calculated each quarter based on management's assessment of project schedules across all customer contracts in Order Backlog, expectations for faster-turn product and services revenues, expected delivery timing of third-party equipment and operational capacity. For fiscal 2027, the Company expects modest revenue growth, reflecting continued demand across its diversified global end markets, while the ongoing reorganization of its transportation-related operations is expected to remove dilutive revenues of approximately $50 million. Additionally, Life Sciences enters fiscal 2027 with a more normalized backlog, having worked through the strong bookings from fiscal 2025. Neither factor reflects a change in the underlying demand environment or the Company's expectations to outperform growth in its chosen markets over time. Over the long term, the Company's objective is to grow revenues at a rate that exceeds the underlying growth of its chosen end markets, supported by its global scale, technology differentiation, and disciplined execution of the ABM.
Adjusted earnings from operations margin is expected to improve by approximately 50 to 75 basis points in fiscal 2027. This improvement is expected to be achieved through a combination of lower costs achieved from the transportation reorganization (see "Reorganization Activity"), disciplined execution of the ABM across the portfolio, targeted commercial practices, and an improved after-market mix supported by the integration of services directly into the Company's operating units. A portion of the savings from the reorganization will be reinvested in higher-growth areas, including the Company's nuclear business, where management sees meaningful long-term opportunity. Margin improvement will not be linear across quarters and should be considered on a full-year basis. The Company's long-term adjusted earnings from operations margin target of 15% remains unchanged. As progress is made toward this target, the Company may update its long-term margin objectives. Adjusted earnings from operations margin is a non-IFRS ratio -- see "Non-IFRS and Other Financial Measures."
Supplier lead times are generally acceptable across key categories; however, inflationary or other cost increases (see "Tariffs"), and price and lead-time volatility may continue to disrupt the timing and progress of the Company's margin expansion efforts and may affect revenue recognition. Over time, achieving management's margin target assumes that the Company will successfully implement its margin expansion initiatives, and that such initiatives will result in improvements to its adjusted earnings from operations margin that offset these shorter-term pressures (see "Forward-Looking Statements" for a description of the risks underlying the achievement of the margin target in future periods).
The timing and geographies of customer capital expenditure decisions on larger opportunities, including as a result of their evaluations of tariffs, can cause variability in Order Bookings from quarter to quarter (see "Tariffs"). Revenues in a given period are dependent on a combination of the volume of outstanding projects the Company is contracted to perform, the size and duration of those projects, and the timing of project activities including design, assembly, testing, and installation. Given the specialized nature of the Company's offerings, the size and scope of projects vary based on customer needs. The Company seeks to achieve revenue growth organically and by identifying strategic acquisition opportunities that provide access to attractive end markets and new products and technologies and deliver hurdle-rate returns. After-sales revenues and reoccurring revenues, which ATS defines as revenues from ancillary products and services associated with equipment sales, and revenues from customers who purchase non-customized ATS products at regular intervals, are expected to provide some balance to customers' capital expenditure cycles. ATS expects reoccurring revenues to be in the range of 25%-35% on a trailing twelve month basis.
The Company maintains a sustained focus on non-cash working capital. Over the long term, the Company expects to continue investing in non-cash working capital to support growth, with some fluctuations expected on a quarter-over-quarter basis. The Company's long-term goal is to maintain its investment in non-cash working capital as a percentage of annualized revenues below 15%. The Company expects that continued cash flows from operations, together with cash and cash equivalents on hand and credit available under operating and long-term credit facilities will be sufficient to fund its requirements for investments in non-cash working capital and capital assets, and to fund strategic investment plans including some potential acquisitions. Acquisitions could result in additional debt or equity financing requirements for the Company. Non-cash working capital as a percentage of revenues is a non-IFRS ratio -- see "Non-IFRS and Other Financial Measures."
The Company continues to make progress with its plans to integrate acquired companies, and expects to realize cost and revenue synergies consistent with announced integration plans.
Reorganization Activity
The Company periodically undertakes reviews of its operations to ensure alignment with strategic market opportunities and other operational efficiency opportunities.
Restructuring costs
The Company previously disclosed expected restructuring costs of approximately $20 million in the third and fourth quarters of fiscal 2026. In the fourth quarter of fiscal 2026, restructuring expenses of $15.2 million were recorded in relation to these activities, bringing the total cost for the year ended March 31, 2026, to $23.1 million. This includes costs from the Company's previously announced fiscal 2025 restructuring program, as well as the fiscal 2026 initiative. Combined, this is consistent with the Company's previously disclosed expectations.
In the first quarter of fiscal 2027, the Company expects restructuring costs of approximately $5 million related to transportation-related divisions and approximately $5 million to $10 million related to other parts of the business, as warranted. As part of transportation-related restructuring, three smaller facilities in the U.S. will be closed. The Company will continue to evaluate its cost structure throughout fiscal 2027 as event-driven opportunities are identified across the portfolio, with a specific focus on margin expansion.
Other reorganization activities
During the fourth quarter of fiscal 2026, after a thorough review, the Company identified additional opportunities to continue the realignment of the cost structure and capital needs of its transportation-related businesses, including consolidation of remaining transportation-focused standalone divisions, and addressing excess facility capacity. Two facilities in the U.S. and one facility in Germany are being held for sale, with one of the facilities in the U.S. to be structured as a sale and leaseback transaction. The proceeds from the sale of these facilities, expected in fiscal 2027, are expected to fund the restructuring activities and other related costs associated with exiting these businesses and concluding the Company's obligations with respect to legacy customer contracts.
As part of these actions, the Company is repositioning its transportation-related activities by applying engineering and automation capabilities, including areas such as laser welding, machine vision and high-precision testing, into other applications where the Company's capability and customer's needs align. As these businesses are repositioned and given they represent a smaller portion of the business overall, the Company expects that, in the coming quarters, transportation will no longer be reported as a separate market vertical.
Included in the fourth quarter of fiscal 2026 net loss is $28.3 million relating to costs directly associated with the transportation reorganization activities noted above, including aged inventory adjustments, and impairment charges and costs associated with completing existing legacy customer contracts. In addition, included in net loss is $9.8 million of costs associated with the Company's previously announced initiative to embed its growing services business within its operating units. These amounts represent $7.2 million of amortization costs associated with redundant assets as well as additional costs to complete remaining legacy (primarily transportation related) customer contracts. The reorganization costs are included as non-IFRS adjusting items in adjusted net income -- see "Reconciliation of Non-IFRS Measures to IFRS Measures."
The restructuring and reorganization activity is expected to support the Company's margin expansion initiatives throughout fiscal 2027.
Tariffs
The majority of the Company's shipments from Canada into the U.S. fall within the current terms of the US-Mexico-Canada trade agreement ("USMCA"). However, the U.S. has imposed tariffs on certain goods from various jurisdictions globally, including Canada and Europe; and further tariffs and trade agreements continue to be discussed. Management continues to actively monitor the situation as it evolves and is taking steps to mitigate risks where possible while continuing to offer support to customers based on their needs, which may include onshoring or reshoring production. Supply chain impacts resulting from shifting trade dynamics have been largely mitigated through alternative sourcing, along with pricing strategies. While the Company could see impacts over time arising from unmitigated costs related to the tariffs themselves, potential supplier price increases, and the timing and geographic shifts in customers' capital deployment, ATS' global footprint and decentralized operating model, supported by the ABM, provide some flexibility to address potential disruptions over the long term. As with prior tariffs, the potential impact, if any, of the revised Section 232 tariffs is dependent on specific customer programs and the nature of the Company's work and, at this time the Company does not expect these tariffs to have a material impact. On a trailing twelve month basis, the Company's equipment and product adjusted revenues from its Canadian and European operations being sold into the U.S. remained consistent with the range previously disclosed, and was just over 20% of the Company's total adjusted revenues for the year ended March 31, 2026. Adjusted revenues is a non-IFRS financial measure -- see "Non-IFRS and Other Financial Measures."
Quarterly Conference Call
ATS will host a conference call and webcast at 8:30 a.m. eastern time on Thursday, May 28, 2026 to discuss its quarterly results. The listen-only webcast can be accessed live at www.atsautomation.com. The listen-only webcast can be accessed at https://events.q4inc.com/attendee/406309619 and the conference call can be accessed by dialing (888) 660-6652 five minutes prior and quoting reference number 8782510. A replay of the conference will be available on the ATS website following the call. Alternatively, a telephone recording of the call will be available for one week (until midnight June 4, 2026) by dialing (800) 770-2030 and using the access code 8782510.
The 2026 Audited Consolidated Financial Statements, including Management's Discussion and Analysis, and the Annual Information Form $(AIF)$, are available on the company's website, www.atsautomation.com. ATS also filed these documents with the Canadian Securities Administrators (accessible through its website at www.sedarplus.ca) and filed with the U.S. Securities and Exchange Commission such documents under its Form 40-F annual report (accessible through its website at www.sec.gov/edgar).
ATS will provide a paper copy of its audited financial statements, free of charge, on request through our website, www.atsautomation.com, or in writing to 730 Fountain Street North, Building #3, Cambridge, ON N3H 4R7, Canada.
About ATS
ATS Corporation is an industry-leading automation solutions provider to many of the world's most successful companies. ATS uses its extensive knowledge base and global capabilities in custom automation, repeat automation, automation products and value-added solutions including pre-automation and after-sales services, to address the sophisticated manufacturing automation systems and service needs of multinational customers in markets such as life sciences, transportation, food & beverage, consumer products, and energy. Founded in 1978, ATS employs over 7,000 people at more than 65 manufacturing facilities and over 85 offices in North America, Europe, Asia and Oceania. The Company's common shares are traded on the Toronto Stock Exchange ("TSX") and the New York Stock Exchange ("NYSE") under the symbol ATS. Visit the Company's website at www.atsautomation.com.
SOURCE: ATS Corporation
Consolidated Adjusted Revenues
(In millions of dollars)
Adjusted Revenues by type Q4 2026 Q4 2025 Fiscal 2026 Fiscal 2025 ------------- --------- --------- ------------ ------------- Revenues from construction contracts $ 388.2 $ 402.0 $ 1,599.2 $ 1,458.0 Services rendered 186.7 159.3 723.9 651.2 Sale of goods 169.4 159.8 647.0 571.0 ------------- ----- ----- -------- --------- Total adjusted revenues $ 744.3 $ 721.1 $ 2,970.1 $ 2,680.2 ------------- ----- ----- -------- --------- Adjusted Revenues by market Q4 2026 Q4 2025 Fiscal 2026 Fiscal 2025 --------------- --------- --------- ----------- ------------ Life Sciences $ 378.0 $ 416.9 $ 1,522.0 $ 1,471.8 Consumer Products 161.1 89.2 553.0 335.7 Food & Beverage 110.7 112.9 498.8 416.9 Energy 67.9 33.7 226.6 124.0 Transportation 26.6 68.4 169.7 331.8 --------------- ----- ----- ------- -------- Total adjusted revenues $ 744.3 $ 721.1 $ 2,970.1 $ 2,680.2 --------------- ----- ----- ------- -------- Adjusted revenues by customer location Q4 2026 Q4 2025 Fiscal 2026 Fiscal 2025 ------------ --------- --------- ------------- ------------- North America $ 404.6 $ 379.0 $ 1,558.6 $ 1,432.0 Europe 247.2 252.5 1,020.5 938.6 Asia/Other 92.5 89.6 391.0 309.6 ------------ ----- ----- --------- --------- Total adjusted revenues $ 744.3 $ 721.1 $ 2,970.1 $ 2,680.2 ------------ ----- ----- --------- --------- Additional adjusted revenue disaggregation Q4 2026 Q4 2025 Fiscal 2026 Fiscal 2025 --------------- --------- --------- ----------- ------------ Custom integration and automation systems $ 241.7 $ 269.4 $ 1,033.7 $ 978.0 Products and equipment 240.8 229.7 927.1 812.8 Services including spare parts 261.8 222.0 1,009.3 889.4 --------------- ----- ----- ------- -------- Total adjusted revenues $ 744.3 $ 721.1 $ 2,970.1 $ 2,680.2 --------------- ----- ----- ------- --------
Consolidated Operating Results
(In millions of dollars)
Q4 Fiscal Fiscal
2026 Q4 2025 2026 2025
-------------------- ----- ------- ------- -------
Earnings (loss) from
operations $ 8.1 $(113.6) $ 198.8 $ 9.3
Amortization of
acquisition-related
intangible assets 13.9 15.2 58.1 66.4
Acquisition-related
transaction costs 0.1 0.9 0.8 4.0
Acquisition-related
inventory fair
value charges -- 0.6 -- 4.4
Restructuring
charges 15.2 3.5 23.1 24.0
Cancelled contract
costs -- -- -- 8.7
EV customer
settlement -- 171.1 -- 171.1
Stock-based
compensation
forfeiture(2) -- -- (7.3) --
Transportation
reorganization(3) 28.3 -- 28.3 --
Services
reorganization(4) 9.8 -- 9.8 --
CEO inducement 1.3 -- 1.3 --
Mark to market
portion of
stock-based
compensation 0.1 (3.4) 1.5 (5.3)
-------------------- ---- ------ ------ ------
Adjusted earnings
from operations(1) $76.8 $ 74.3 $ 314.4 $ 282.6
-------------------- ---- ------ ------ ------
(1) Non-IFRS financial measure -- see "Non-IFRS and Other
Financial Measures." (2) Reversal of previously recorded
stock-based compensation expense due to departure of the
Company's former CEO within the fiscal year. (3) Included
in the transportation reorganization costs is an increase
of $2.8 million to revenue, $28.6 million increase of cost
of revenues, and $2.5 million increase to SG&A. (4)
Included in the services reorganization is a $2.6 million
impact to cost of revenues, $2.0 million of amortization
charges recorded to cost of revenues, and $5.2 million of
amortization recorded to SG&A.
Q4 Fiscal Fiscal
2026 Q4 2025 2026 2025
-------------------- ------ ------- ------- -------
Earnings (loss) from
operations $ 8.1 $(113.6) $ 198.8 $ 9.3
Depreciation and
amortization 46.8 38.0 163.9 152.7
-------------------- ----- ------ ------ ------
EBITDA(1) $ 54.9 $ (75.6) $ 362.7 $ 162.0
-------------------- ----- ------ ------ ------
Restructuring
charges 15.2 3.5 23.1 24.0
Acquisition-related
transaction costs 0.1 0.9 0.8 4.0
Acquisition-related
inventory fair
value charges -- 0.6 -- 4.4
Cancelled contract
costs -- -- -- 8.7
EV customer
settlement -- 171.1 -- 171.1
Stock-based
compensation
forfeiture(2) -- -- (7.3) --
Transportation
reorganization 28.3 -- 28.3 --
Services
reorganization(3) 2.6 -- 2.6 --
CEO inducement 1.3 -- 1.3 --
Mark to market
portion of
stock-based
compensation 0.1 (3.4) 1.5 (5.3)
-------------------- ----- ------ ------ ------
Adjusted EBITDA(1) $102.5 $ 97.1 $ 413.0 $ 368.9
-------------------- ----- ------ ------ ------
(1) Non-IFRS financial measure -- See "Non-IFRS and Other
Financial Measures". (2) Reversal of previously recorded
stock-based compensation expense due to departure of the
Company's former CEO within the fiscal year. (3) Services
reorganization costs incurred in the quarter include $7.2
million of amortization costs arising from a change in
useful lives of certain assets. These amounts are excluded
from the reconciling adjustment as they are already excluded
in the calculation of EBITDA.
Order Backlog by Market
(In millions of dollars)
March 31 March 31
As at 2026 2025
------------------ ---------- ----------
Life Sciences $ 1,077 $ 1,199
Consumer Products 278 282
Food & Beverage 214 258
Energy 260 186
Transportation 129 214
------------------ ------ ------
Total $ 1,958 $ 2,139
------------------ ------ ------
Order Bookings by Quarter
(In millions of dollars)
Fiscal 2026 Fiscal 2025
--------------------- ------------- -------------
Q1 $ 693 $ 817
Q2 734 742
Q3 821 883
Q4 704 863
--------------------- --------- ---------
Total Order Bookings $ 2,952 $ 3,305
--------------------- --------- ---------
Reconciliation of Non-IFRS Measures to IFRS Measures
(In millions of dollars, except per share data)
The following table reconciles adjusted revenues to the most directly comparable IFRS measure (revenue):
Q4 Q4 Fiscal Fiscal
2026 2025 2026 2025
------------------ ------ ------ -------- --------
Adjusted revenues $744.3 $721.1 $2,970.1 $2,680.2
Transportation
reorganization(1) (2.8) -- (2.8) --
EV customer
settlement -
revenue portion -- 146.9 -- 146.9
------------------ ----- ----- ------- -------
Revenues $747.1 $574.2 $2,972.9 $2,533.3
------------------ ----- ----- ------- -------
(1) The transportation reorganization included an increase
to revenue and cost of revenue and was recorded to reflect
additional billings and costs to complete legacy customer
programs -- see "Reorganization Activity."
The following table reconciles adjusted EBITDA and EBITDA to the most directly comparable IFRS measure (net income (loss)):
Q4 Fiscal Fiscal
2026 Q4 2025 2026 2025
-------------------- ------ ------- ------- -------
Adjusted EBITDA $102.5 $ 97.1 $ 413.0 $ 368.9
Less: Restructuring
charges 15.2 3.5 23.1 24.0
Less:
Acquisition-related
transaction costs 0.1 0.9 0.8 4.0
Less:
Acquisition-related
inventory fair
value charges -- 0.6 -- 4.4
Less: Cancelled
contract costs -- -- -- 8.7
Less: EV customer
settlement -- 171.1 -- 171.1
Less: Stock-based
compensation
forfeiture(1) -- -- (7.3) --
Less: Transportation
reorganization 28.3 -- 28.3 --
Less: Services
reorganization(2) 2.6 -- 2.6 --
Less: CEO inducement 1.3 -- 1.3 --
Less: Mark to market
portion of
stock-based
compensation 0.1 (3.4) 1.5 (5.3)
-------------------- ----- ------ ------ ------
EBITDA $ 54.9 $ (75.6) $ 362.7 $ 162.0
Less: Depreciation
and amortization
expense 46.8 38.0 163.9 152.7
-------------------- ----- ------ ------ ------
Earnings (loss) from
operations $ 8.1 $(113.6) $ 198.8 $ 9.3
Less: Net finance
costs 25.5 26.7 99.6 92.2
Less: Income tax
expense (recovery) (1.2) (71.4) 27.5 (54.9)
-------------------- ----- ------ ------ ------
Net income (loss) $(16.2) $ (68.9) $ 71.7 $ (28.0)
-------------------- ----- ------ ------ ------
(1) Reversal of previously recorded stock-based compensation
expense due to departure of the Company's former CEO within
the fiscal year. (2) Services reorganization costs incurred
in the quarter include $7.2 million of amortization costs
arising from a change in useful lives of certain assets.
These amounts are excluded from the reconciling adjustment as
they are already excluded in the calculation of EBITDA.
The following table reconciles adjusted earnings from operations, adjusted net income, and adjusted basic earnings per share to the most directly comparable IFRS measures (net income (loss) and basic earnings (loss) per share):
Three Months Ended March 31, 2026 Three Months Ended March 31, 2025
-------------------- ---------------------------------------------------- ------------------------------------------------------
Earnings Income Earnings Income Net
from Finance tax Net Basic (loss) from Finance tax Income Basic
operations costs recovery income EPS operations costs recovery (loss) EPS
-------------------- ------------ ------- --------- ------ ------ ----------- ------- --------- ------ ------
Reported (IFRS) $ 8.1 $ (25.5) $ 1.2 $(16.2) $(0.16) $ (113.6) $ (26.7) $ 71.4 $(68.9) $(0.70)
Amortization of
acquisition-related
intangibles 13.9 -- -- 13.9 0.14 15.2 -- -- 15.2 0.15
Restructuring
charges 15.2 -- -- 15.2 0.15 3.5 -- -- 3.5 0.04
Acquisition-related
inventory fair
value charges -- -- -- -- -- 0.6 -- -- 0.6 0.01
Acquisition-related
transaction costs 0.1 -- -- 0.1 -- 0.9 -- -- 0.9 0.01
EV customer
settlement -- -- -- -- -- 171.1 -- -- 171.1 1.75
Transportation
reorganization 28.3 -- -- 28.3 0.29 -- -- -- -- --
Services
reorganization 9.8 -- -- 9.8 0.10 -- -- -- -- --
CEO inducement 1.3 -- -- 1.3 0.01 -- -- -- -- --
Mark to market
portion of
stock-based
compensation 0.1 -- -- 0.1 -- (3.4) -- -- (3.4) (0.04)
Adjustment to income
tax recovery(1) -- -- (17.1) (17.1) (0.17) -- -- (79.0) (79.0) (0.81)
-------------------- -------- ------ -------- ----- ----- ---------- ------ -------- ----- -----
Adjusted (non-IFRS) $ 76.8 $ 35.4 $ 0.36 $ 74.3 $ 40.0 $ 0.41
-------------------- -------- -------- ---------- ----- ----- ---------- -------- ---------- ----- -----
(1) For a breakdown of items included in adjustments to income tax expense (recovery) see reconciliation of adjusted effective
income tax rate table.
Year Ended March 31, 2026 Year Ended March 31, 2025
-------------------- -------------------------------------------------- ------------------------------------------------------
Earnings Income Earnings Income Net
from Finance tax Net Basic from Finance tax income Basic
operations costs expense income EPS operations costs recovery (loss) EPS
-------------------- ---------- ------- -------- ------ ------ ---------- ------- --------- ------- ------
Reported (IFRS) $ 198.8 $ (99.6) $ (27.5) $ 71.7 $ 0.73 $ 9.3 $ (92.2) $ 54.9 $ (28.0) $(0.29)
Amortization of
acquisition-related
intangibles 58.1 -- -- 58.1 0.59 66.4 -- -- 66.4 0.68
Restructuring
charges 23.1 -- -- 23.1 0.23 24.0 -- -- 24.0 0.24
Acquisition-related
inventory fair
value charges -- -- -- -- -- 4.4 -- -- 4.4 0.04
Acquisition-related
transaction costs 0.8 -- -- 0.8 0.01 4.0 -- -- 4.0 0.04
Cancelled contract
costs -- -- -- -- -- 8.7 -- -- 8.7 0.09
EV customer
settlement -- -- -- -- -- 171.1 -- -- 171.1 1.75
Stock-based
compensation
forfeiture(1) (7.3) -- -- (7.3) (0.07) -- -- -- -- --
Transportation
reorganization 28.3 -- -- 28.3 0.29 -- -- -- -- --
Services
reorganization 9.8 -- -- 9.8 0.10 -- -- -- -- --
CEO inducement 1.3 -- -- 1.3 0.01 -- -- -- -- --
Mark to market
portion of
stock-based
compensation 1.5 -- -- 1.5 0.02 (5.3) -- -- (5.3) (0.05)
Adjustment to income
tax expense
(recovery)(2) -- -- (21.8) (21.8) (0.22) -- -- (100.9) (100.9) (1.03)
-------------------- --------- ------ ------- ----- ----- --------- ------ -------- ------ -----
Adjusted (non-IFRS) $ 314.4 $165.5 $ 1.69 $ 282.6 $ 144.4 $ 1.47
-------------------- --------- -------- --------- ----- ----- --------- -------- ---------- ------ -----
(1) Reversal of previously recorded stock-based compensation expense due to departure of the Company's former CEO within the
fiscal year. (2) For a breakdown of items included in adjustments to income tax expense (recovery) see reconciliation of
adjusted effective income tax rate table.
The following table reconciles organic revenue to adjusted revenues, which have been reconciled to the most directly comparable IFRS measure (revenues) earlier in this press release:
Q4 2026 Q4 2025 Fiscal 2026 Fiscal 2025
------------ --------- --------- ------------- -------------
Organic
revenue $ 731.9 $ 671.3 $ 2,841.1 $ 2,492.2
Revenues of
acquired
companies -- 28.5 43.2 140.8
Impact of
foreign
exchange
rate
changes 12.4 21.3 85.8 47.2
------------ ----- ----- --------- ---------
Total
adjusted
revenues $ 744.3 $ 721.1 $ 2,970.1 $ 2,680.2
------------ ----- ----- --------- ---------
Organic
revenue
growth 1.5% 6.0%
------------ ----- --------- --------- -------------
The following table reconciles non-cash working capital as a percentage of adjusted revenues to the most directly comparable IFRS measures:
As at March 31, 2026 March 31, 2025 ---------------------------------- ---------------- ---------------- Accounts receivable $ 523.7 $ 719.4 Income tax receivable 10.4 32.1 Contract assets 436.8 503.6 Inventories 295.2 320.2 Deposits, prepaids and other assets 94.9 104.2 Accounts payable and accrued liabilities (622.4) (665.1) Income tax payable (34.1) (40.1) Contract liabilities (307.3) (330.1) Provisions (32.1) (30.0) ---------------------------------- ------------ ------------ Non-cash working capital $ 365.1 $ 614.2 Trailing six-month adjusted revenues annualized $ 3,009.8 $ 2,746.1 ---------------------------------- ------------ ------------ Working capital % 12.1% 22.4% ---------------------------------- ------------ ------------
The following table reconciles net debt to the most directly comparable IFRS measures:
As at March 31, 2026 March 31, 2025 ---------------------------------- ---------------- ---------------- Cash and cash equivalents $ 285.0 $ 225.9 Bank indebtedness (6.7) (27.3) Current portion of lease liabilities (35.2) (32.7) Current portion of long-term debt (0.2) (0.2) Long-term lease liabilities (119.5) (96.7) Long-term debt (1,274.6) (1,543.5) ---------------------------------- ------------ ------------ Net Debt $ (1,151.2) $ (1,474.5) Pro Forma Adjusted EBITDA $(TTM)$ $ 413.0 $ 374.4 ---------------------------------- ------------ ------------ Net Debt to Pro Forma Adjusted 2.8x 3.9x EBITDA ---------------------------------- ------------ ------------
The following table reconciles free cash flow to the most directly comparable IFRS measures:
(in millions of Q4 Q4 Fiscal Fiscal dollars) 2026 2025 2026 2025 ---------------- ------ ------ ---------- ---------- Cash flows provided by operating activities $149.5 $ 39.3 $ 448.4 $ 25.8 Acquisition of property, plant and equipment (12.3) (11.9) (33.6) (34.0) Acquisition of intangible assets (13.1) (17.1) (43.1) (44.1) ---------------- ----- ----- ------ ------ Free cash flow $124.1 $ 10.3 $ 371.7 $ (52.3) ---------------- ----- ----- ------ ------
The following table calculates the adjusted effective tax rate based on net income before income taxes including adjusting items and adjusted income tax expense:
(in millions of Q4 Fiscal Fiscal dollars) 2026 Q4 2025 2026 2025 -------------------- ----- ------- ------- ------- Earnings (loss) from operations $ 8.1 $(113.6) $ 198.8 $ 9.3 Amortization of acquisition-related intangible assets 13.9 15.2 58.1 66.4 Acquisition-related transaction costs 0.1 0.9 0.8 4.0 Acquisition-related inventory fair value charges -- 0.6 -- 4.4 Restructuring charges 15.2 3.5 23.1 24.0 Cancelled contract costs -- -- -- 8.7 EV customer settlement -- 171.1 -- 171.1 Stock-based compensation forfeiture -- -- (7.3) -- Transportation reorganization 28.3 -- 28.3 -- Services reorganization 9.8 -- 9.8 -- CEO inducement 1.3 -- 1.3 -- Mark to market portion of stock-based compensation 0.1 (3.4) 1.5 (5.3) -------------------- ---- ------ ------ ------ Adjusted earnings from operations 76.8 74.3 314.4 282.6 Net finance costs 25.5 26.7 99.6 92.2 -------------------- ---- ------ ------ ------ Income before income taxes including adjusting items 51.3 47.6 214.8 190.4 Income tax expense (recovery) (1.2) (71.4) 27.5 (54.9) Estimated tax impact of adjusting items 17.1 44.0 28.8 65.9 Impact of recognition of previously unrecognized deferred income tax assets from prior years -- 36.8 -- 36.8 Income tax impacts relating to transactions that occurred in a prior fiscal year -- (1.8) -- (1.8) Additional tax provision related to the departure of the Company's former CEO in the fiscal year -- -- (1.6) -- Impact of tax rate change on deferred tax assets -- -- (5.4) -- -------------------- ---- ------ ------ ------ Adjusted income tax expense 15.9 7.6 49.3 46.0 -------------------- ---- ------ ------ ------ Adjusted effective income tax rate 31.0% 16.0% 23.0% 24.2% -------------------- ---- ------ ------ ------
Certain non-IFRS financial measures exclude the impact on stock-based compensation expense of the revaluation of restricted share units ("RSUs") and deferred share units ("DSUs") resulting specifically from the change in market price of the Company's common shares between periods. Management believes the adjustment provides further insight into the Company's performance.
The following table reconciles total stock-based compensation expense to its components:
(in millions of Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 dollars) 2026 2026 2026 2026 2025 2025 2025 2025 ---------------- ----- ----- ----- ----- ----- ----- ----- ----- Total stock-based compensation expense (recovery) $ 2.5 $ 4.5 $(6.7) $ 8.4 $(2.3) $ 5.1 $ 2.7 $ 3.7 Less: stock-based compensation forfeiture(1) -- -- (7.3) -- -- -- -- -- Less: Mark to market portion of stock-based compensation 0.1 1.4 (3.7) 3.6 (3.4) 1.4 (1.9) (1.3) ---------------- ---- ---- ---- ---- ---- ---- ---- ---- Base stock-based compensation expense $ 2.4 $ 3.1 $ 4.3 $ 4.8 $ 1.1 $ 3.7 $ 4.6 $ 5.0 ---------------- ---- ---- ---- ---- ---- ---- ---- ---- (1) Reversal of previously recorded stock-based compensation expense due to departure of the Company's former CEO within the fiscal year.
INVESTMENTS, LIQUIDITY, CASH FLOW AND FINANCIAL RESOURCES
(In millions of dollars, except ratios)
As at March 31, 2026 March 31, 2025
---------------------------------------- ---------------- ----------------
Cash and cash equivalents $ 285.0 $ 225.9
Debt-to-equity ratio(1) 0.89:1 1.10:1
---------------------------------------- ---------------- ----------------
(1) Debt is calculated as bank indebtedness, long-term debt and lease
liabilities. Equity is calculated as total equity less accumulated other
comprehensive income.
Fiscal
Q4 2026 Q4 2025 2026 Fiscal 2025
------------- ------- --------- ---------- -----------
Cash,
beginning of
period $ 263.1 $ 263.2 $ 225.9 $ 170.2
Total cash
provided by
(used in):
Operating
activities 149.5 39.3 448.4 25.8
Investing
activities (24.9) (24.6) (76.0) (268.5)
Financing
activities (102.4) (54.3) (313.1) 290.3
Net foreign
exchange
difference (0.3) 2.3 (0.2) 8.1
------------- ------ ----- ------ -------
Cash, end of
period $ 285.0 $ 225.9 $ 285.0 $ 225.9
------------- ------ ----- ------ -------
ATS CORPORATION
Consolidated Statements of Financial Position
(in thousands of Canadian dollars)
March 31 March 31
As at 2026 2025
----------------------------------------- ---------- ----------
ASSETS
Current assets
Cash and cash equivalents $ 284,957 $ 225,947
Accounts receivable 523,738 719,435
Income tax receivable 10,356 32,065
Contract assets 436,847 503,552
Inventories 295,206 320,172
Deposits, prepaids and other assets 94,873 104,179
------------------------------------------ --------- ---------
1,645,977 1,905,350
Assets held for sale 60,302 --
----------------------------------------- --------- ---------
1,706,279 1,905,350
Non-current assets
Property, plant and equipment 259,791 325,048
Right-of-use assets 147,054 122,291
Long-term deposits 3,710 4,992
Other assets 4,464 7,062
Goodwill 1,399,253 1,394,576
Intangible assets 704,210 758,531
Deferred income tax assets 115,269 104,022
------------------------------------------ --------- ---------
2,633,751 2,716,522
----------------------------------------- --------- ---------
Total assets $4,340,030 $4,621,872
------------------------------------------ --------- ---------
LIABILITIES AND EQUITY
Current liabilities
Bank indebtedness $ 6,744 $ 27,271
Accounts payable and accrued liabilities 622,436 665,109
Income tax payable 34,123 40,073
Contract liabilities 307,306 330,134
Provisions 32,100 29,960
Current portion of lease liabilities 35,202 32,694
Current portion of long-term debt 173 219
------------------------------------------ --------- ---------
1,038,084 1,125,460
Non-current liabilities
Employee benefits 26,075 25,805
Long-term provisions 468 1,000
Long-term lease liabilities 119,486 96,699
Long-term debt 1,274,552 1,543,459
Deferred income tax liabilities 80,462 100,573
Other long-term liabilities 21,445 19,519
------------------------------------------ --------- ---------
1,522,488 1,787,055
----------------------------------------- --------- ---------
Total liabilities $2,560,572 $2,912,515
------------------------------------------ --------- ---------
EQUITY
Share capital $ 852,805 $ 842,015
Contributed surplus 30,758 36,539
Accumulated other comprehensive income 171,573 166,855
Retained earnings 722,621 660,368
------------------------------------------ --------- ---------
Equity attributable to shareholders 1,777,757 1,705,777
Non-controlling interests 1,701 3,580
------------------------------------------ --------- ---------
Total equity 1,779,458 1,709,357
------------------------------------------ --------- ---------
Total liabilities and equity $4,340,030 $4,621,872
------------------------------------------ --------- ---------
Please refer to complete Consolidated Financial Statements for supplemental notes which can be found on the Company's profile on SEDAR+ at www.sedarplus.ca, the Company's profile on the U.S. Securities and Exchange Commission's website at www.sec.gov, and on the Company's website at www.atsautomation.com.
ATS CORPORATION
Consolidated Statements of Income (Loss)
(in thousands of Canadian dollars, except per share amounts)
Years ended March 31 2026 2025
------------------------------------------ --------- ---------
Revenues $2,972,932 $2,533,288
Operating costs and expenses
Cost of revenues 2,122,067 1,886,641
Selling, general and administrative 620,270 604,241
Restructuring costs 23,128 23,972
Stock-based compensation 8,687 9,178
------------------------------------------- --------- ---------
Earnings from operations 198,780 9,256
Net finance costs 99,579 92,194
------------------------------------------- --------- ---------
Income (loss) before income taxes 99,201 (82,938)
Income tax expense (recovery) 27,468 (54,960)
------------------------------------------- --------- ---------
Net income (loss) $ 71,733 $ (27,978)
------------------------------------------- --------- ---------
Attributable to
Shareholders $ 71,637 $ (28,049)
Non-controlling interests 96 71
------------------------------------------- --------- ---------
$ 71,733 $ (27,978)
------------------------------------------ --------- ---------
Earnings (loss) per share attributable to
shareholders
Basic and diluted $ 0.73 $ (0.29)
------------------------------------------- --------- ---------
Please refer to complete Consolidated Financial Statements for supplemental notes which can be found on the Company's profile on SEDAR+ at www.sedarplus.ca, the Company's profile on the U.S. Securities and Exchange Commission's website at www.sec.gov, and on the Company's website at www.atsautomation.com.
ATS CORPORATION
Consolidated Statements of Cash Flows
(in thousands of Canadian dollars)
Years ended March 31 2026 2025 ---------------------------------------------- -------- -------- Operating activities Net income (loss) $ 71,733 $ (27,978) Items not involving cash Depreciation of property, plant and equipment 34,470 33,674 Amortization of right-of-use assets 38,821 33,824 Amortization of intangible assets 90,582 85,172 Deferred income taxes (37,522) (84,546) Other items not involving cash (1,345) (16,971) Stock-based compensation 5,057 10,564 Change in non-cash operating working capital 246,587 (7,968) ---------------------------------------------- -------- -------- Cash flows provided by operating activities $ 448,383 $ 25,771 ---------------------------------------------- -------- -------- Investing activities Acquisition of property, plant and equipment $ (33,642) $ (33,952) Acquisition of intangible assets (43,134) (44,078) Business acquisitions, net of cash acquired -- (179,389) Settlement of cross-currency interest rate swap instrument -- (16,555) Proceeds from disposal of property, plant and equipment 740 5,532 ---------------------------------------------- -------- -------- Cash flows used in investing activities $ (76,036) $(268,442) ---------------------------------------------- -------- -------- Financing activities Bank indebtedness $ (20,420) $ 22,478 Repayment of long-term debt (331,424) (573,777) Proceeds from long-term debt 84,999 907,015 Settlement of cross-currency interest rate swap instrument -- 24,262 Proceeds from exercise of stock options 12,422 495 Purchase of non-controlling interest (4,370) -- Repurchase of common shares (10,000) (44,983) Acquisition of shares held in trust (9,616) (14,690) Principal lease payments (34,676) (30,519) ---------------------------------------------- -------- -------- Cash flows provided by (used in) financing activities $(313,085) $ 290,281 ---------------------------------------------- -------- -------- Effect of exchange rate changes on cash and cash equivalents (252) 8,160 ---------------------------------------------- -------- -------- Increase in cash and cash equivalents 59,010 55,770 Cash and cash equivalents, beginning of year 225,947 170,177 ---------------------------------------------- -------- -------- Cash and cash equivalents, end of year $ 284,957 $ 225,947 ---------------------------------------------- -------- -------- Supplemental information Cash income taxes paid $ 42,166 $ 61,936 Cash interest paid $ 97,501 $ 95,151 ---------------------------------------------- -------- --------
Please refer to complete Consolidated Financial Statements for supplemental notes which can be found on the Company's profile on SEDAR+ at www.sedarplus.ca, the Company's profile on the U.S. Securities and Exchange Commission's website at www.sec.gov, and on the Company's website at www.atsautomation.com.
Notice to Readers: Non-IFRS and Other Financial Measures
Throughout this document, management uses certain non-IFRS financial measures, non-IFRS ratios and supplementary financial measures to evaluate the performance of the Company.
The terms "EBITDA", "organic revenue", "adjusted net income", "adjusted earnings from operations", "adjusted revenues", "adjusted EBITDA", "pro forma adjusted EBITDA", "adjusted basic earnings per share", and "free cash flow", are non-IFRS financial measures, "operating margin", "EBITDA margin", "adjusted earnings from operations margin", "adjusted EBITDA margin", "organic revenue growth", "non-cash working capital as a percentage of adjusted revenues", and "net debt to pro forma adjusted EBITDA" are non-IFRS ratios, and "reoccurring revenues", "custom integration and automation systems revenues", "products and equipment revenues", "service including spare parts revenues", "Order Bookings", "organic Order Bookings", "organic Order Bookings growth", "Order Backlog", and "book-to-bill ratio" are supplementary financial measures, all of which do not have any standardized meaning prescribed within IFRS and therefore may not be comparable to similar measures presented by other companies. Such measures should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. In addition, management uses "earnings from operations", which is an additional IFRS measure, to evaluate the performance of the Company. Earnings from operations is presented on the Company's consolidated statements of income as net income excluding income tax expense and net finance costs. Operating margin is an expression of the Company's earnings from operations as a percentage of adjusted revenues. EBITDA is defined as earnings from operations excluding depreciation and amortization. EBITDA margin is an expression of the Company's EBITDA as a percentage of adjusted revenues. Organic revenue is defined as adjusted revenues in the stated period excluding revenues from acquired companies for which the acquired company was not a part of the consolidated group in the comparable period. Organic revenue growth compares the stated period organic revenue with the reported adjusted revenues of the comparable prior period. Adjusted earnings from operations is defined as earnings from operations before items excluded from management's internal analysis of operating results, such as amortization expense of acquisition-related intangible assets, acquisition-related transaction and integration costs, restructuring charges, legal settlement costs that arise outside of the ordinary course of business, the mark-to-market adjustment on stock-based compensation and certain other adjustments which would be non-recurring in nature ("adjustment items"). Adjusted earnings from operations margin is an expression of the Company's adjusted earnings from operations as a percentage of adjusted revenues. Adjusted revenues are defined as revenues before any adjustment items. Adjusted EBITDA is defined as adjusted earnings from operations excluding depreciation and amortization. Pro forma adjusted EBITDA is adjusted EBITDA on a pro forma basis to reflect full contribution from recent acquisitions. Adjusted EBITDA margin is an expression of the entity's adjusted EBITDA as a percentage of revenues. Adjusted basic earnings per share is defined as adjusted net income on a basic per share basis, where adjusted net income is defined as adjusted earnings from operations less net finance costs and income tax expense, plus tax effects of adjustment items and adjusted for other significant items of a non-recurring nature. Non-cash working capital as a percentage of adjusted revenues is defined as the sum of accounts receivable, contract assets, inventories, deposits, prepaids and other assets, less accounts payable, accrued liabilities, provisions and contract liabilities divided by the trailing two fiscal quarter adjusted revenues annualized. Free cash flow is defined as cash provided by operating activities less property, plant and equipment and intangible asset expenditures. Net debt to pro forma adjusted EBITDA is the ratio of the net debt of the Company (cash and cash equivalents less bank indebtedness, long-term debt, and lease liabilities) to the trailing twelve month pro forma adjusted EBITDA. Reoccurring revenue for ATS is defined as adjusted revenues from ancillary products and services associated with equipment sales and revenue from customers who purchase non-customized ATS products at regular intervals. Custom integration and automation systems revenues are defined as adjusted revenues from end-to-end manufacturing solutions customized to customer needs. Products and equipment revenues are defined as adjusted revenues from modular or standardized equipment and other products. Services including spare parts revenues are defined as revenues from consulting, digital and other services, including aftermarket services and spares. Order Bookings represent new orders for the supply of automation systems, services and products that management believes are firm. Organic Order Bookings are defined as Order Bookings in the stated period excluding Order Bookings from acquired companies for which the acquired company was not a part of the consolidated group in the comparable period. Organic Order Bookings growth compares the stated period organic Order Bookings with the reported Order Bookings of the comparable prior period. Order Backlog is the estimated unearned portion of revenues on customer contracts that are in process and have not been completed at the specified date. Book to bill ratio is a measure of Order Bookings compared to adjusted revenue.
Following amendments to ATS' RSU Plan in 2022 to provide the Company with the option for settlement in shares purchased in the open market and the creation of the employee benefit trust to facilitate such settlement, ATS began to account for equity-settled RSUs using the equity method of accounting. However, prior RSU grants which will be cash-settled and DSU grants which will be cash-settled are accounted for as described in the Company's annual consolidated financial statements and have volatility period over period based on the fluctuating price of ATS' common shares. Certain non-IFRS financial measures (adjusted EBITDA, net debt to pro forma adjusted EBITDA, adjusted earnings from operations and adjusted basic earnings per share) exclude the impact on stock-based compensation expense of the revaluation of DSUs and RSUs resulting specifically from the change in market price of the Company's common shares between periods. Management believes that this adjustment provides insight into the Company's performance, as share price volatility drives variability in the Company's stock-based compensation expense.
Operating margin, adjusted earnings from operations, adjusted revenues, EBITDA, EBITDA margin, adjusted EBITDA, pro forma adjusted EBITDA, and adjusted EBITDA margin are used by the Company to evaluate the performance of its operations. Management believes that earnings from operations is an important indicator in measuring the performance of the Company's operations on a pre-tax basis and without consideration as to how the Company finances its operations. Management believes that adjusted revenues, organic revenue and organic revenue growth, when considered with IFRS measures, allow the Company to better measure the Company's performance and evaluate long-term performance trends. Organic revenue growth also facilitates easier comparisons of the Company's performance with prior and future periods and relative comparisons to its peers. Management believes that EBITDA and adjusted EBITDA are important indicators of the Company's ability to generate operating cash flows to fund continued investment in its operations. Management believes that adjusted earnings from operations, adjusted earnings from operations margin, adjusted EBITDA, adjusted net income and adjusted basic earnings per share are important measures to increase comparability of performance between periods. The adjustment items used by management to arrive at these metrics are not considered to be indicative of the business' ongoing operating performance. Management uses the measure "non-cash working capital as a percentage of adjusted revenues" to assess overall liquidity. Free cash flow is used by the Company to measure cash flow from operations after investment in property, plant and equipment and intangible assets. Management uses net debt to pro forma adjusted EBITDA as a measurement of leverage of the Company. Reoccurring revenues, custom integration revenues, products and equipment revenues and service including spare parts revenues are used by the Company to understand the revenue portfolio of the Company. Order Bookings provide an indication of the Company's ability to secure new orders for work during a specified period, while Order Backlog provides a measure of the value of Order Bookings that have not been completed at a specified point in time. Both Order Bookings and Order Backlog are indicators of future revenues that the Company expects to generate based on contracts that management believes to be firm. Organic Order Bookings and organic Order Bookings growth allow the Company to better measure the Company's performance and evaluate long-term performance trends. Organic Order Bookings growth also facilitates easier comparisons of the Company's performance with prior and future periods and relative comparisons to its peers. Book to bill ratio is used to measure the Company's ability and timeliness to convert Order Bookings into revenues. Management believes that ATS shareholders and potential investors in ATS use these additional IFRS
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