Mr. Teri McKibbon reports

BIRD CONSTRUCTION INC. ANNOUNCES 2023 SECOND QUARTER FINANCIAL RESULTS

Bird Construction Inc. has released its 2023 second quarter financial results.

"Bird's strong second quarter financial performance, coupled with almost $1-billion in contract bookings, highlight the advantages of the company's strategic focus on being a leading collaborative construction company. Working closely and transparently with our customers and partners drives better outcomes with lower financial and project risk, benefiting all parties involved. The company's growing combined backlog, with favourable embedded margins, remains highly collaborative in nature and supports Bird's confidence in continued revenue growth and margin expansion for the second half of the year and beyond," stated Teri McKibbon, president and chief executive officer of Bird Construction. "The commitment of our entire Bird team to drive collaboration, cross-selling and diversification across the organization is paying dividends. The company grew revenue 19 per cent in the quarter versus last year and delivered over $7-million in cash from operating activities, an almost-$80-million improvement from 2022. With a strong balance sheet, we continue to support investments in the company's future growth, both organically and through opportunistic tuck-in acquisitions."

Financial highlights

Bird's second quarter of 2023 delivered significant organic revenue growth while gross profit and EBITDA (earnings before interest, taxes, depreciation and amortization) margins strengthened compared with both the first quarter of the year and to the same quarter of last year. The company reported the highest quarterly revenue in its history, while at the same time continuing to grow its backlog and pending backlog of future work to new record combined levels. Bird continues to drive growth through its diversified and risk-balanced business model, with expanding cross-selling opportunities across its service offerings and robust, accretive performance from recent acquisitions. Bird generates the majority of revenues from lower-risk contract types, has limited exposure to lump-sum turnkey projects, and minimal work in interest-rate-sensitive residential and commercial construction markets.

Second quarter of 2023, compared with the second quarter of 2022:

• Construction revenue was $686.4-million, compared with $576.7-million, representing a 19.0-per-cent increase year over year.
• Net income and earnings per share were $13.7-million and 26 cents, respectively, compared with $14.1-million and 26 cents in Q2 2022.
• Adjusted earnings (1) and adjusted earnings per share (1) were $15.7-million and 29 cents, respectively, compared with $8.5-million and 16 cents in Q2 2022.
• Adjusted EBITDA (1) was $29.5-million, or 4.3 per cent of revenues, compared with $21.5-million, or 3.7 per cent of revenues in Q2 2022.

Year to date 2023, compared with year to date 2022:

• Construction revenue of $1,222.9-million was earned in the first six months of 2023, compared with $1,052.2-million in 2022, representing a 16.2-per-cent increase year over year.
• Net income and earnings per share for the first half year were $18.9-million and 35 cents, respectively, compared with $20.5-million and 38 cents in 2022.
• Adjusted earnings (1) and adjusted earnings per share (1) were $21.0-million and 39 cents year to date in 2023, respectively, compared with $15.0-million and 28 cents in the prior year.
• Adjusted EBITDA (1) for the first six months of 2023 was $45.5-million, or 3.7 per cent of revenues, compared with $39.3-million, or 3.7 per cent of revenues, in 2022.

(1) This news release contains terminology and financial measures that do not have standard meanings under IFRS (international financial reporting standards) and may not be comparable with similar measures presented by other companies.

Highlights:

• Bird executed a record amount of work in the second quarter of 2023, delivering revenues of $686.4-million, driven predominantly by organic growth, with additional contributions from Trinity, acquired on Feb. 1, 2023.
• The company's margin profile continued to improve in the quarter compared with the prior year, with gross profit percentage increasing to 7.9 per cent and adjusted EBITDA margin increasing to 4.3 per cent, from 7.5 per cent and 3.7 per cent, respectively, in the second quarter of 2022.
• Bird added almost $1.0-billion in securements to its backlog during the quarter ($1.6-billion year to date), growing the company's backlog to $3.0-billion at June 30, 2023. The company's pending backlog also grew by $106.5-million during the quarter to $3.1-billion, and includes approximately $1.1-billion of master service agreement (MSA) and recurring revenue work to be performed over the next seven years.
• Bird maintains a strong liquidity position at June 30, 2023, with operational cash flows for the quarter, financing not only the growth in the company's work program, but also productivity and project-driven capital expenditures and net repayments of debt. Bird ended the second quarter with $107.1-million of cash and cash equivalents, and an additional $172.0-million available under the company's syndicated credit facility.
• During the second quarter of 2023, the company announced that it was awarded the following projects and contracts:
  • Bird was awarded $300-million in additional recurring MSA work, including a new seven-year MSA for multidiscipline bundled services across a client's maintenance, turnarounds and sustaining capital programs, and contract extensions with additional services and scope on existing MSAs ranging from three to five years. Similar to other MSA awards, the value will reside in pending backlog and be converted to backlog over time as purchase orders are received against the MSAs.
  • Bird was awarded a construction management services contract valued at approximately $50-million for British Columbia Housing's permanent supportive housing initiative, located in Vancouver, B.C. The project, supported by Bird's preconstruction design services and with a final design delivered in conjunction with Bird's stack modular business, will be the first modular project of this height in Canada, delivering a volumetric steel modular tower with 14 floors of quality units on a rapid, repeatable scale. The project will follow the Passive House green building design standard, and the modular approach, with off-site design and construction of the units, substantially reduces construction time and reduces the impact on the local community during construction.
  • Bird was selected as the successful proponent for lot 1: coarse tailing dam raise project, by Quebec Iron Ore. The work will be completed at the Bloom Lake mine in Fermont, Que., one of the five largest iron ore mines in Canada.
  • Bird was awarded the B.C. Ferries' FMU redevelopment project, including the renovation of five existing buildings and the replacement of several older buildings, including the existing machine shop, with a state-of-the-art multipurpose machine shop expanding the existing operational space by almost three times.
• Subsequent to the quarter-end, the company announced that it was awarded the following projects and contracts:
  • Bird was awarded multiple contracts for industrial and civil work in the energy and mining sectors valued at approximately $180-million, including a contract for civil and concrete scopes to support processing infrastructure development at the Blackwater mine project in central British Columbia, two contracts for rehabilitation work on hydroelectric power-related structures in Northeastern Ontario, and a contract for final site earthworks, grading and asphalt paving at an existing project site in northwestern British Columbia.
  • Bird was selected as the preferred proponent for the Southern Alberta Institute of Technology's (SAIT) campus centre redevelopment project, the Victor Philip Dahdaleh Hall project at St. Francis Xavier University and two long-term care facilities in Nova Scotia. The combined value of the contracts is over $350-million.
• The board has declared eligible dividends of 3.58 cents per common share for each of August, September and October, 2023.

Conference call and webcast

Bird will host an investor webcast to discuss the quarterly results on Thursday, Aug. 10, 2023, at 10 a.m. ET, to discuss the company's results. Analysts and investors may connect to the webcast. They may also dial 1-855-328-1925 for audio only or to enter the question queue; attendees are asked to be on the line 10 minutes prior to the start of the call. The presentation can also be found on the company's website.

The company's financial statements and management's discussion and analysis (MD&A) will be filed and available on SEDAR and on the company's website.

About Bird Construction Inc.

Bird is a leading Canadian construction company operating from coast-to-coast and servicing all of Canada's major markets. Bird provides a comprehensive range of construction services from new construction for industrial, commercial, and institutional and civil infrastructure markets, to industrial maintenance, repair and operations services, heavy civil construction, and mine support services, as well as vertical infrastructure, including, electrical, mechanical and specialty trades. For over 100 years, Bird has been a people-focused company with an unwavering commitment to safety and a high level of service that provides long-term value for all stakeholders.

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