Forward-looking Statements

Transcription

1 Investor Conference Call August 28, 2017

2 Forward-looking Statements Statements and information herein that are not historical facts are "forward-looking information". Words such as plans, intends, outlook, expects, anticipates, estimates, believes, "likely", should, "could", "will", "may" and similar expressions often identify forward-looking information and statements. Forward looking statements and information may include, without limitation, statements regarding the operations, business, financial condition, liquidity, expected financial results, performance, obligations, market conditions, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Toromont and its business units. Forward-looking information and statements contained herein are based on, among other things, Toromont management's current assumptions, expectations, estimates, objectives, plans and intentions regarding projected revenues and expenses, the economic, industry and regulatory environments in which Toromont operates or which could affect its activities, Toromont's ability to attract and retain customers as well as Toromont's operating costs and raw materials supply. By their nature, forward-looking information and statements, and the factors upon which they are based, are subject to risks and uncertainties which may be beyond Toromont's ability to control or predict. Actual results or events could differ materially from those expressed or implied by forward-looking information and statements. Factors that could cause actual results or events to differ from current expectations include, among others: business cycle risk, including general economic conditions in the countries in which Toromont operates; risk of commodity price changes including precious and base metals; risk of changes in foreign exchange rates, including the Cdn$/US$ exchange ate; risk of the termination of distribution or original equipment manufacturer agreements; risk of equipment product acceptance and availability of supply; risk of increased competition; credit risk related to financial instruments; risk of additional costs associated with warranties and maintenance contracts; interest rate risk on financing arrangements; risk of availability of financing; risk of environmental regulation. Additional information on these factors and other risks and uncertainties that could cause actual results or events to differ from current expectations can be found in the Risks and Risk Management and Outlook section of Toromont s annual MD&A for 2016 contained in the 2016 Toromont Annual Report. Other factors, risks and uncertainties not presently known to Toromont or that Toromont currently believes are not material could also cause actual results or events to differ materially from those expressed or implied by forward-looking information and statements. Forward-looking information and statements contained herein about prospective results of operations, financial position or cash flows are presented for the purpose of assisting Toromont's shareholders in understanding managements' current view regarding those future outcomes and may not be appropriate for other purposes. Readers are cautioned not to place undue reliance on the forwardlooking information and statements contained herein, which are given as of the date of this document, and not to use such information and statements for anything other than their intended purpose. Toromont disclaims any obligation or intention to update or revise any forward-looking information or statement, whether the result of new information, future events or otherwise, except as required by applicable law. 2

3 Toromont to Acquire Hewitt Equipment Transaction is valued at $ billion Represents Toromont s most significant milestone Toromont and Hewitt have complementary operations and customer service model Driven by growth opportunities and trend towards industry consolidation Supported by Toromont s strong balance sheet 3

4 Putting Transaction in Perspective Largest Toromont acquisition Largest Caterpillar dealer transaction $ B Total consideration Serves as a testament to the successes of Toromont and Hewitt 4

5 Complementary Operations to Toromont Toromont Hewitt Group 100 locations 3600 employees 45 locations 2100 employees Opportunity to extend Toromont s decentralized operating model 5 5

6 Hewitt at a Glance Founded in 1952 Authorized Caterpillar dealer in Quebec and Western Labrador Hewitt Cat Authorized Caterpillar dealer in the Maritimes Atlantic Cat Authorized MaK dealer in Quebec, Maritimes & eastern U.S. (ME to VA) Authorized MCFA dealer (Lift) in Quebec and most of Ontario 45 branches employees Complementary operations to Toromont 6

7 Complementary Operations to Toromont Sectors Mining Construction Energy Forestry Services Sales Rentals Material handling Service & Support Share similar values, customers and processes 7 7

8 Hewitt s Financial Performance 3-yr Revenue Results ($millions) $1,200 $1,088 $1,108 $1,049 $1,000 $800 $600 $400 $200 $ yr EBIT Results ($millions) $70.0 $66.4 $60.0 $56.9 $50.0 $40.0 $34.0 $30.0 $20.0 $10.0 $ Principal markets recovering from downturn in

9 Hewitt s Diversified Results Hewitt FY 2016 Revenue by Division Hewitt FY 2016 Revenue by Product Line Material Handling 11% HRI 8% Used Machine Sales 13% Rental 9% Truck 4% Energy 12% Heavy Equipment 65% New Machine Sales 32% Parts 36% Service 10% Diversified revenues contribute to steady performance 9

10 Toromont s Expanded Presence Current markets Manitoba Nunavut Ontario Newfoundland & Labrador New markets Quebec Western Labrador The Maritimes Significant heavy equipment dealer spanning Eastern Canada 10

11 How Transaction Will be Funded Settlement upon close: 2.25 million Toromont shares Cash on hand Committed bank credit facility Bond offering to be launched in coming weeks $1.0177B Total consideration Possible due to Toromont s strong balance sheet 11

12 Opportunities for Growth $91B in infrastructure spending pledged by Québec government over next 10 years Plan Nord Recovery of commodity prices Opportunities for synergies Favorable long-term outlook 12

13 Significant Mining Operations Quebec is home to 3 mining regions Presence of precious, base and ferrous metals diversity contributes balance Hewitt has strong relationships with customers Large customer fleets Opportunities to expand operations and capitalize on sector turnaround 13

14 Summary Transaction is valued at $ billion Represents Toromont s most significant milestone Toromont and Hewitt have complementary operations and customer service model Driven by growth opportunities and trend towards industry consolidation Supported by Toromont s strong balance sheet 14

15 Q&A For more information contact: Paul R. Jewer Executive Vice President and CFO Toromont Industries Ltd. (416) For media inquiries: Nini Krishnappa T (647) nkrishnappa@national.ca or Andrea Danielle Wong T (514) awong@national.ca 15

16 Investor Conference Call August 28, 2017