AGI Announces Fourth Quarter 2022 Results; Declares First Quarter 2023 Dividends

WINNIPEG, Manitoba--(BUSINESS WIRE)--Ag Growth International Inc. (TSX: AFN) (“AGI”, the “Company”, “we” or “our”) today announced its financial results for the three-months and year-ended December 31, 2022.

Fourth Quarter 2022 Highlights

• Record fourth quarter results for sales and adjusted EBITDA
• Sales increased 14% to $374 million on a year-over-year (‘YOY’) basis
• Adjusted EBITDA¹ increased 14% to $51 million on a YOY basis
• Adjusted EBITDA margin² of 13.6% vs 13.7% on a YOY basis
• Total leverage ratio² of 3.7x at December 31, 2022 vs 4.1x at September 30, 2022 and 4.7x at December 31, 2021

Full year 2022 Highlights

• Third consecutive year of record sales and adjusted EBITDA results with growth largely attributable to organic growth efforts and initiatives
• Sales increased 22% to $1.46 billion on a YOY basis
• Adjusted EBITDA¹ increased 33% to $235 million on a YOY basis
• Adjusted EBITDA margin² of 16.1% vs 14.7% on a YOY basis

Outlook

• Management expects full year 2023 adjusted EBITDA to be at least $260 million¹, representing continued growth and momentum
• Backlog³ is up 10% YOY as of December 31, 2022, despite the deferred or cancelled orders as a result of the conflict in Ukraine, and is sitting at record-levels for year-end and near-record levels all-time

“Our record fourth quarter results for sales and adjusted EBITDA are an ideal way for AGI to close-out another record year,” noted Paul Householder, President & CEO of AGI. “With progress across our three corporate strategic priorities – profitable organic growth, operational excellence, balance sheet discipline – and tangible improvements on the KPIs we use to track these three priorities, we are highly encouraged by the significant progress and growth achieved in 2022. With a strong backlog, momentum across the business, and a clear set of initiatives to continue our growth trajectory, we look forward to another excellent year for AGI in 2023.”

“Our growth and targeted initiatives to manage spending have enabled AGI to continue progress against our balance sheet and cash management objectives,” added Jim Rudyk, CFO of AGI. “The fourth quarter showed continued commitment to our deleveraging targets with growth in adjusted EBITDA and meaningful repayment against our senior credit facilities both helping to get our total leverage ratio under 4.0x at year-end. While 2022 was highlighted by significant progress in improving our key balance sheet ratios, we remain committed and vigilant to continue this trend in 2023.”

SUMMARY OF FOURTH QUARTER 2022 RESULTS

	Three-months ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Sales by Operating Segment ^[1]
Farm	180,985	145,577	35,408	24%
Commercial	193,049	181,518	11,531	6%
Total	374,034	327,095	46,939	14%

	Three-months ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Adjusted EBITDA ^[2] [3] [4]
Farm	32,482	31,159	1,323	4%
Commercial	30,658	24,336	6,322	26%
Other ^[5]	(12,143)	(10,844)	(1,299)	12%
Total	50,997	44,651	6,346	14%

	Three-months ended December 31
	2022	2021	Change	Change
[percentages]	%	%	%	%
Adjusted EBITDA Margin % ^[2] [6]
Farm	18%	21%	(3%)	(16%)
Commercial	16%	13%	2%	18%
Other ^[5][7]	(3%)	(3%)	0%	(2%)
Total	14%	14%	(0%)	(0%)

Sales by Geography ^[1]	Three-months ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Canada	87,725	46,730	40,995	88%
U.S.	141,676	128,050	13,626	11%
International
EMEA	39,278	51,965	(12,687)	(24%)
Asia Pacific	50,339	42,420	7,919	19%
South America	55,016	57,930	(2,914)	(5%)
Total International	144,633	152,315	(7,682)	(5%)
Total Sales	374,034	327,095	46,939	14%

SUMMARY OF FULL YEAR 2022 RESULTS

	Year ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Sales ^[1]
Farm	778,088	647,869	130,219	20%
Commercial	679,994	550,654	129,340	23%
Total	1,458,082	1,198,523	259,559	22%

	Year ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Adjusted EBITDA ^[2] [3] [4]
Farm	163,118	140,961	22,157	16%
Commercial	106,760	66,771	39,989	60%
Other ^[5]	(35,195)	(31,466)	(3,729)	12%
Total	234,683	176,266	58,417	33%

	Year ended December 31
	2022	2021	Change	Change
[percentages]	%	%	%	%
Adjusted EBITDA Margin % ^[2] [6]
Farm	21%	22%	(1%)	(4%)
Commercial	16%	12%	4%	29%
Other ^[5][7]	(2%)	(3%)	0%	(8%)
Total	16%	15%	1%	9%

Sales by Geography ^[1]	Year ended December 31
	2022	2021	Change	Change
[thousands of dollars]	$	$	$	%
Canada	333,353	267,755	65,598	24%
U.S.	649,905	532,443	117,462	22%
International
EMEA	126,046	127,899	(1,853)	(1%)
Asia Pacific	158,212	128,758	29,454	23%
South America	190,566	141,668	48,898	35%
Total International	474,824	398,325	76,499	19%
Total Sales	1,458,082	1,198,523	259,559	22%

[1]	The sales information in this table are supplementary financial measures and are used throughout this press release. See “NON-IFRS and OTHER FINANCIAL MEASURES” for more information on these supplementary financial measures.
[2]	See “BASIS OF PRESENTATION”
[3]	This is a non-IFRS measure and is used throughout this press release. See “NON-IFRS and OTHER FINANCIAL MEASURES” for more information on each non-IFRS measure.
[4]	See “DETAILED OPERATING RESULTS – Profit (loss) before income taxes and Adjusted EBITDA” and “DETAILED OPERATING RESULTS – Profit (loss) before income taxes and Adjusted EBITDA by Segment”.
[5]	Included in Other is the corporate office, which is not a reportable segment, and which provides finance, treasury, legal, human resources and other administrative support to the segments.
[6]	This is a non-IFRS ratio and is used throughout this press release. See “NON-IFRS and OTHER FINANCIAL MEASURES” for more information on each non-IFRS ratio.
[7]	The adjusted EBITDA Margin % for Other is calculated based on total sales since it does not generate sales without the segments.

Farm Segment

The Farm segment delivered impressive results in the fourth quarter, with sales and adjusted EBITDA growing by 24% and 4% YOY, respectively. In addition, full year sales and adjusted EBITDA growth of 20% and 16%, respectively, continue the trend of strong momentum over an already historic performance in 2021. This growth was fueled by the continued demand for portable grain handling equipment in Canada, the U.S., and Asia Pacific, as well as permanent grain handling and storage solutions in South America. As consumption continues to increase globally, we are seeing sustained demand for our Farm segment products as growers around the world increase production. The fourth quarter adjusted EBITDA margin decreased as compared to the fourth quarter of 2021 as that quarter benefited from the price increases we implemented ahead of rising input costs which peaked in 2022.

Commercial Segment

The Commercial segment delivered a strong fourth quarter with sales and adjusted EBITDA increasing 6% and 26% YOY, respectively. For the full year, sales and adjusted EBITDA grew 23% and 60%, respectively, driven by significant growth in Canada, the U.S., South America, and Asia Pacific markets. The Canadian region was a standout performer, with sales growth of 83%, or 35% net of acquisitions, indicating a strong recovery in this region that was initially hard hit by the pandemic. The improvement in this region has also been accelerated by a more unified structure and approach to our overall North America Commercial business.

Internationally, the growth in the Brazil and India regions continues to be extraordinary. Annual sales growth of 36% and 44%, respectively, and adjusted EBITDA growth of 28% and 68%, respectively, underscores the importance of our regional diversification strategy and the benefits of our investments in developing market positions within these critical agricultural regions.

OUTLOOK

Sustained demand for agriculture equipment and infrastructure enabled AGI to cap off another record year in sales and adjusted EBITDA with excellent momentum heading into 2023. Our quoting pipelines are highly active and we continue to see strong interest from customers across all segments and regions as they continue to invest in critical infrastructure equipment and solutions. The consolidated backlog was up 10% YOY at record-levels for year-end and near record levels all-time. Of note, at year-end the backlog was up by 60% from 2020 year-end, further highlighting the step-change in the mix of our business, demand for AGI products, and our ability to expand market share.

As a result, full year 2023 adjusted EBITDA is expected to be at least $260 million, representing continued growth and momentum over our record 2022 results.

Backlog

The following tables presents YOY changes in the Company’s backlogs^[1]:

	Region
Segments	Canada	United States	International	Overall
	%	%	%	%
Farm	131%	(1%)	(18%)	25%
Commercial	(11%)	(15%)	6%	(3%)
Overall	79%	(6%)	3%	10%

The following table presents YOY changes in the Company’s international backlogs^[1] further segmented by region:

Farm and Commercial Segments	EMEA	Asia Pacific	South America
	%	%	%
International by region ^[2]	(45%)	31%	109%

[1]	Supplementary financial measure. See "Non-IFRS and Other Financial Measures".
[2]	"EMEA" is composed of Europe, Middle East and Africa. "Asia Pacific" is composed of Southeast Asia, Australia, India and Rest of World. "South America" is composed of Brazil and the rest of Latin America.

First Quarter 2023 Dividend

AGI also announced the declaration of a cash dividend of $0.15 per common share for the first quarter ending March 31, 2023. The dividend is payable on April 14, 2023 to common shareholders of record at the close of business on March 31, 2023. The dividend is an eligible dividend for Canadian income tax purposes. AGI’s current annualized cash dividend rate is $0.60 per share.

MD&A and Financial Statements

AGI's audited consolidated comparative financial statements for the year ended December 31, 2022 ("consolidated financial statements") and management’s discussion and analysis (the “MD&A”) for the three months and year ended December 31, 2022 can be obtained electronically on SEDAR (http://www.sedar.com) and on AGI's website (http://www.aggrowth.com).

Conference Call

AGI management will hold a conference call on Wednesday, March 8, 2023, at 8:00am EST to discuss its results for the three-months ending December 31, 2022. To participate in the conference call, please dial 1-800-319-4610 if joining from Canada or the U.S. and 1-604-638-5340 internationally. An audio replay of the call will be available for seven days. To access the audio replay, please dial 1-800-319-6413 if calling from Canada or the U.S. and 1-604-638-9010 internationally. Please quote passcode 9862 for the audio replay.

AGI Company Profile

AGI is a provider of the equipment and solutions required to support the efficient storage, transport, and processing of food globally. AGI has manufacturing facilities in Canada, the United States, Brazil, India, France, and Italy and distributes its product worldwide.

Further information can be found in the disclosure documents filed by AGI with the securities regulatory authorities, available at www.sedar.com and on AGI's website www.aggrowth.com.

BASIS OF PRESENTATION

On December 29, 2022, the Company announced that it will be reorganizing its digital business to better reflect changes in its operations and management structure. As a result of this change, the Company has identified its reportable segments as Farm and Commercial, each of which are supported by the corporate office. The previously identified Digital segment has now been included within the Farm segment, and the Food platform which was a sub-segment of the Commercial segment has been amalgamated into the Commercial segment. These segments are strategic business units that offer different products and services. Certain corporate overheads are allocated to the segments based on revenue as well as applicable cost drivers. Taxes and certain other expenses are managed at a consolidated level and are not allocated to the reportable operating segments. Financial information for the comparative period has been restated to reflect the new presentation.

NON-IFRS AND OTHER FINANCIAL MEASURES

This press release makes reference to certain specified financial measures, including non-IFRS financial measures, non-IFRS ratios and supplementary financial measures. Management uses these financial measures for purposes of comparison to prior periods and development of future projections and earnings growth prospects. This information is also used by management to measure the profitability of ongoing operations and in analyzing our business performance and trends. These specified financial measures are not recognized measures under International Financial Reporting Standards ("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 our financial information reported under IFRS by providing further understanding of our results of operations from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS.

We use the following (i) non-IFRS financial measures: “adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”)” and "total net debt"; (ii) non-IFRS ratios: “adjusted EBITDA margin %” and “total leverage ratio”; and (iii) supplementary financial measures: “backlog”, “sales by operating segment” and “sales by geography”; to provide supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS financial measures. Management also uses non-IFRS financial measures, non-IFRS ratios and supplementary financial measures in order to prepare annual operating budgets and to determine components of management compensation. We strongly encourage investors to review our consolidated financial statements and publicly filed reports in their entirety and not to rely on any single financial measure or ratio.

We use these specified financial measures in addition to, and in conjunction with, results presented in accordance with IFRS. These specified financial measures reflect an additional way of viewing aspects of our operations that, when viewed with our IFRS results and, in the case of non-IFRS financial measures, the accompanying reconciliations to the most directly comparable IFRS financial measures, may provide a more complete understanding of factors and trends affecting our business.

In this press release, we discuss the specified financial measures, including the reasons that we believe that these measures provide useful information regarding our financial condition, results of operations, cash flows and financial position, as applicable, and, to the extent material, the additional purposes, if any, for which these measures are used. Reconciliations of non-IFRS financial measures to the most directly comparable IFRS financial measures are contained in this press release.

The following is a list of non-IFRS financial measures, non-IFRS ratios and supplementary financial measures that are referenced throughout this press release:

“Adjusted EBITDA” is defined as profit (loss) before income taxes before finance costs, depreciation and amortization, share of associate’s net loss, gain on remeasurement of equity investment or revaluation gains, gain or loss on foreign exchange, non-cash share -based compensation expenses, gain on financial instruments, M&A recovery or expenses, change in estimate on variable considerations, transaction, transitional and other costs, net gain or loss on the sale of property, plant & equipment, gain or loss on settlement of right-of-use assets, gain or loss on settlement of lease liability, gain on disposal of (foreign) operation, equipment rework, remediation, non-cash expenses related to the sale of inventory that acquisition accounting required be recorded at a value higher than manufacturing cost and impairment. Adjusted EBITDA is a non-IFRS financial measure and its most directly comparable financial measure that is disclosed in our consolidated financial statements is profit (loss) before income taxes. Management believes Adjusted EBITDA is a useful measure to assess the performance and cash flow of the Company as it excludes the effects of interest, taxes, depreciation, amortization and expenses that management believes are not reflective of the Company’s underlying business performance. Management cautions investors that Adjusted EBITDA should not replace profit or loss as indicators of performance, or cash flows from operating, investing, and financing activities as a measure of the Company’s liquidity and cash flows. See “Profit (loss) before income taxes and Adjusted EBITDA” and “Profit (loss) before income taxes and Adjusted EBITDA by Segment” below for the reconciliation of Adjusted EBITDA to profit (loss) before income taxes for the current and comparative periods. Adjusted EBITDA guidance is a forward-looking non-IFRS financial measure. We do not provide a reconciliation of such forward-looking measure to the most directly comparable financial measure calculated and presented in accordance with IFRS due to unknown variables and the uncertainty related to future results. These unknown variables may include unpredictable transactions of significant value that may be inherently difficult to determine without unreasonable efforts. Guidance for Adjusted EBITDA is calculated in the same manner as described above for historical Adjusted EBITDA, as applicable.

“Adjusted EBITDA margin %” is defined as Adjusted EBITDA divided by sales. Adjusted EBITDA margin % is a non-IFRS ratio because one of its components, Adjusted EBITDA, is a non-IFRS financial measure. Management believes Adjusted EBITDA margin % is a useful measure to assess the performance and cash flow of the Company.

“Backlogs” are defined as the total value of committed sales orders that have not yet been fulfilled that: (a) have a high certainty of being performed as a result of the existence of a purchase order, an executed contract or work order specifying job scope, value and timing; or (b) has been awarded to the Company or its divisions, as evidenced by an executed binding letter of intent or agreement, describing the general job scope, value and timing of such work, and where the finalization of a formal contract in respect of such work is reasonably assured. Backlog is a supplementary financial measure.

"Sales by Operating Segment" and "Sales by Geography": The sales information presented under "Sales by Operating Segment" and "Sales by Geography" are supplementary financial measures used to present the Company's sales by segment and geography.

“Total Leverage Ratio” is a non-IFRS ratio and is defined as total net debt divided by adjusted EBITDA for the last twelve month ("LTM") period. Total leverage ratio is a non-IFRS ratio because its components, total net debt and Adjusted EBITDA, are non-IFRS financial measures. Management believes total leverage ratio is a useful measure to assess AGI’s leverage position.

“Total Net Debt” is a non-IFRS financial measure and its most directly comparable financial measure that is disclosed in our consolidated financial statements is long-term debt. Total net debt is defined as the sum of long-term debt, convertible unsecured subordinated debentures, senior unsecured subordinated debentures, and lease liabilities less cash and cash equivalents. Management believes that total net debt is a useful measure to evaluate AGI's capital structure and to provide a measurement of AGI's total indebtedness. See "Total Net Debt" below for a reconciliation of long-term debt to total net debt as at December 31, 2021, September 30, 2022 and December 31, 2022.

Profit (loss) before income taxes and Adjusted EBITDA

The following table reconciles profit (loss) before income taxes to Adjusted EBITDA.

	Three-months ended		Year-ended
	December 31		December 31
[thousands of dollars]	2022	2021	2022	2021
	$	$	$	$
Profit (loss) before income taxes	(76,526)	(21,701)	(45,313)	9,383
Finance costs	17,197	11,948	61,067	43,599
Depreciation and amortization	19,024	16,374	76,945	62,049
Share of associate's net loss ^[1]	—	—	—	1,077
Revaluation gains ^[1]	—	—	—	(6,778)
Loss (gain) on foreign exchange ^[2]	(2,211)	211	8,941	2,992
Share-based compensation ^[3]	4,910	2,553	15,620	8,551
Gain on financial instruments ^[4]	(8,211)	(1,929)	(9,629)	(1,382)
M&A (recovery) expense ^[5]	(25)	962	(144)	3,035
Change in estimate on variable considerations ^[6]	—	11,400	—	11,400
Transaction, transitional and other costs ^[7]	15,395	4,763	44,301	12,058
Net loss (gain) on disposal of property, plant and equipment	(13)	(60)	339	23
Loss (gain) on settlement of lease liability	1	(28)	1	(17)
Equipment rework ^[8]	6,100	10,000	6,100	10,000
Remediation ^[8]	—	8,600	—	16,100
Foreign exchange reclassification on disposal of foreign operation	—	—	—	(898)
Fair value of inventory from acquisition ^[9]	—	—	609	—
Impairment charge ^[10]	75,356	1,558	75,846	5,074
Adjusted EBITDA	50,997	44,651	234,683	176,266

[1]	See “Share of associate's net loss and revaluation gains” in our MD&A.
[2]	See “Note 26 [e] - Other expenses (income)” in our consolidated financial statements.
[3]	The Company’s share-based compensation expense pertains to our equity incentive award plan (“EIAP”) and directors’ deferred compensation plan (“DDCP”). See “Note 25 – Share-based compensation plans” in our consolidated financial statements.
[4]	See “Equity swap” in our MD&A.
[5]	Transaction (recoveries) costs associated with completed and ongoing mergers and acquisitions activities.
[6]	The result of a change in management estimate on variable considerations for a one-time sales concessions related to previous sales contracts.
[7]	Includes transitional costs related to the Digital segment reorganization (See BASIS OF PRESENTATION), restructuring and other acquisition related transition costs, as well as the accretion and other movement in contingent consideration and amounts due to vendors.
[8]	See “Remediation costs and equipment rework” in our MD&A.
[9]	Non-cash expenses related to the sale of inventory that acquisition accounting required be recorded at a value higher than manufacturing cost.
[10]	Impairment charge is a result of impairment charges related to the reorganization of the Company’s Digital segment and write-down in property, plant and equipment. See “Note 12 - Property, plant and equipment”, “Note 13 - Right-of-use assets”, “Note 14 – Goodwill”, “Note 15 – Intangible assets” and “Note 16 – Impairment testing” in our consolidated financial statements.

Profit (loss) before income taxes and Adjusted EBITDA by Segment

Three-months ended December 31, 2022
[thousands of dollars]	Farm	Commercial	Other ^[13]	Total
	$	$	$	$
Profit (loss) before income taxes	(64,116)	21,194	(33,604)	(76,526)
Finance costs	—	—	17,197	17,197
Depreciation and amortization ^[1]	10,580	6,469	1,975	19,024
Gain on foreign exchange ^[3]	—	—	(2,211)	(2,211)
Share-based compensation ^[4]	—	—	4,910	4,910
Gain on financial instruments ^[5]	—	—	(8,211)	(8,211)
M&A recovery ^[6]	—	—	(25)	(25)
Transaction, transitional and other costs ^[8]	13,669	—	1,726	15,395
Net (gain) loss on disposal of property, plant and equipment ^[1]	(13)	—	—	(13)
Loss on settlement of lease liability	—	1	—	1
Equipment rework ^[9]	—	—	6,100	6,100
Impairment charge ^[11]	72,362	2,994	—	75,356
Adjusted EBITDA ^[12]	32,482	30,658	(12,143)	50,997

Three-months ended December 31, 2021
[thousands of dollars]	Farm	Commercial	Other ^[13]	Total
	$	$	$	$
Profit (loss) before income taxes	10,898	16,917	(49,516)	(21,701)
Finance costs	—	—	11,948	11,948
Depreciation and amortization ^[1]	9,119	5,663	1,592	16,374
Loss on foreign exchange ^[3]	—	—	211	211
Share-based compensation ^[4]	—	—	2,553	2,553
Gain on financial instruments ^[5]	—	—	(1,929)	(1,929)
M&A expense ^[6]	—	—	962	962
Change in estimate on variable considerations ^[7]	11,400	—	—	11,400
Transaction, transitional and other costs ^[8]	—	—	4,763	4,763
Net gain on disposal of property, plant and equipment ^[1]	(258)	198	—	(60)
Gain on settlement of lease liability	—	—	(28)	(28)
Equipment rework ^[9]	—	—	10,000	10,000
Remediation ^[9]	—	—	8,600	8,600
Impairment charge ^[11]	—	1,558	—	1,558
Adjusted EBITDA ^[12]	31,159	24,336	(10,844)	44,651

Year ended December 31, 2022
[thousands of dollars]	Farm	Commercial	Other ^[13]	Total
	$	$	$	$
Profit (loss) before income taxes	36,676	72,716	(154,705)	(45,313)
Finance costs	—	—	61,067	61,067
Depreciation and amortization ^[1]	40,548	29,494	6,903	76,945
Loss on foreign exchange ^[3]	—	—	8,941	8,941
Share-based compensation ^[4]	—	—	15,620	15,620
Gain on financial instruments ^[5]	—	—	(9,629)	(9,629)
M&A recovery ^[6]	—	—	(144)	(144)
Transaction, transitional and other costs ^[8]	13,669	—	30,632	44,301
Net (gain) loss on disposal of property, plant and equipment ^[1]	(160)	479	20	339
Loss on settlement of lease liability	—	1	—	1
Equipment rework ^[9]	—	—	6,100	6,100
Fair value of inventory from acquisition ^[10]	—	609	—	609
Impairment charge ^[11]	72,385	3,461	—	75,846
Adjusted EBITDA ^[12]	163,118	106,760	(35,195)	234,683

Year Ended December 31, 2021
[thousands of dollars]	Farm	Commercial	Other ^[13]	Total
	$	$	$	$
Profit (loss) before income taxes	97,137	38,192	(125,946)	9,383
Finance costs	—	—	43,599	43,599
Depreciation and amortization ^[1]	32,604	23,292	6,153	62,049
Share of associate's net loss ^[2]	—	—	1,077	1,077
Revaluation gains ^[2]	—	—	(6,778)	(6,778)
Loss on foreign exchange ^[3]	—	—	2,992	2,992
Share-based compensation ^[4]	—	—	8,551	8,551
Gain on financial instruments ^[5]	—	—	(1,382)	(1,382)
M&A expense ^[6]	—	—	3,035	3,035
Change in estimate on variable considerations ^[7]	11,400	—	—	11,400
Transaction, transitional and other costs ^[8]	—	—	12,058	12,058
Net loss (gain) on disposal of property, plant and equipment ^[1]	(191)	213	1	23
Loss on settlement of lease liability	11	—	(28)	(17)
Equipment rework ^[9]	—	—	10,000	10,000
Remediation ^[9]	—	—	16,100	16,100
Foreign exchange reclassification on disposal of foreign operation	—	—	(898)	(898)
Impairment charge ^[11]	—	5,074	—	5,074
Adjusted EBITDA ^[12]	140,961	66,771	(31,466)	176,266

[1]	Allocated based on the segment of the underlying asset’s cash generating unit (“CGU”).
[2]	See “Share of associate's net loss and revaluation gains” in our MD&A.
[3]	See “Note 26 [e] - Other expenses (income)” in our consolidated financial statements.
[4]	The Company’s share-based compensation expense pertains to our EIAP and DDCP. See “Note 25 – Share-based compensation plans” in our consolidated financial statements.
[5]	See “Equity swap” in our MD&A.
[6]	Transaction (recoveries) costs associated with completed and ongoing mergers and acquisitions activities.
[7]	The result of a change in management estimate on variable considerations for a one-time sales concessions related to previous sales contracts.
[8]	Includes transitional costs related to the Digital segment reorganization (See BASIS OF PRESENTATION), restructuring and other acquisition related transition costs, as well as the accretion and other movement in contingent consideration and amounts due to vendors.
[9]	See “Remediation costs and equipment rework” in our MD&A.
[10]	Non-cash expenses related to the sale of inventory that acquisition accounting required be recorded at a value higher than manufacturing cost.
[11]	Impairment charge is a result of impairment charges related to the reorganization of the Company’s Digital segment and write-down in property, plant and equipment. See “Note 12 - Property, plant and equipment”, “Note 13 - Right-of-use assets”, “Note 14 – Goodwill”, “Note 15 – Intangible assets” and “Note 16 – Impairment testing” in our consolidated financial statements.
[12]	This is a non-IFRS measure and is used throughout this MD&A. See “NON-IFRS and OTHER FINANCIAL MEASURES” for more information on each non-IFRS measure.
[13]	Included in Other is the corporate office, which is not a reportable segment, and which provides finance, treasury, legal, human resources and other administrative support to the segments.

Profit (loss) before income taxes and Adjusted EBITDA for the LTM Period Ending September 30, 2022

(thousands of dollars)	LTM Sept 30, 2022
Profit / (loss) before income taxes	9,512
Finance costs	55,818
Depreciation and amortization	74,295
Loss on foreign exchange ^[2]	11,363
Share-based compensation ^[3]	13,263
(Gain) / loss on financial instruments ^[4]	(3,347)
M&A expense ^[5]	843
Change in estimate on variable considerations ^[6]	11,400
Other transaction and transitional costs ^[7]	33,669
Net loss on disposal of property, plant and equipment	292
Gain on settlement of right-of-use assets	(28)
Equipment rework and remediation ^[8]	18,600
Fair value of inventory from acquisition	609
Impairment charge ^[9]	2,048
Adjusted EBITDA	228,337

[1]	See “Share of associate's net loss (gain)” in our management discussion and analysis and consolidated financial statements for the quarter ended September 30, 2022 ("2022 Statements") and year ended December 31, 2021 (“2021 Statements”).
[2]	See “Note 13 [e] - Other expenses (income)” in our 2022 Statements and "Note 25 [e] - Other expenses (income)” in our 2021 Statements.
[3]	The Company’s share-based compensation expense pertains to our equity incentive award plan and directors’ deferred compensation plan. See “Note 12 – Share-based compensation plans” in our 2022 Statements and "Note 24 – Share-based compensation plans” in our 2021 Statements.
[4]	See “Equity swap” in our 2022 Statements and 2021 Statements.
[5]	Transaction costs associated with completed and ongoing mergers and acquisitions activities.
[6]	The result of a change in management estimate on variable considerations for a one-time sales concessions related to previous sales contracts.
[7]	Includes restructuring and other acquisition related transition costs, as well as the accretion and other movement in contingent consideration and amounts due to vendors.
[8]	See “Remediation costs and equipment rework” in our 2022 Statements and 2021 Statements.
[9]	Impairment is a result of a write-down in fixed assets and intangible assets.

Total Net Debt

Total Net Debt
	Q4/21	Q3/22	Q4/22
(thousands of dollars)	31-Dec-21	30-Sep-22	31-Dec-22
Long Term Debt	434,541	504,466	440,938
Convertible Unsecured Subordinated Debentures	179,533	181,929	183,481
Senior Unsecured Subordinated Debentures	250,872	252,269	252,750
Leases	22,279	37,338	39,147
Less: Cash & Cash Equivalents	61,307	42,384	59,644
Total Net Debt	825,918	933,618	856,672

FORWARD-LOOKING INFORMATION

This press release contains forward-looking statements and information [collectively, "forward-looking information"] within the meaning of applicable securities laws that reflect our expectations regarding the future growth, results of operations, performance, business prospects, and opportunities of the Company. All information and statements contained herein that are not clearly historical in nature constitute forward-looking information, and the words “anticipate”, “estimate”, “believe”, “continue”, “could”, “expects”, “intend”, "trend", “plans”, “will”, “may” or similar expressions suggesting future conditions or events or the negative of these terms are generally intended to identify forward-looking information. Forward-looking information involves known or unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. In addition, this press release may contain forward-looking information attributed to third party industry sources. Undue reliance should not be placed on forward-looking information, as there can be no assurance that the plans, intentions or expectations upon which it is based will occur. In particular, the forward-looking information in this MD&A includes information relating to: our business and strategy; our outlook for our financial and operating performance in fiscal 2023 and beyond, including by segment, product type and geographic region, and including our expectations for our future financial results (including our forecast for full year 2023 Adjusted EBITDA, which is expected to represent continued growth and momentum over 2022 results), industry demand and market conditions; that our initiatives will continue our growth trajectory; that we expect another excellent year for AGI in 2023; our commitment to continue the trend in 2023 of improving our key balance sheet ratios; and the long-term fundamentals and growth drivers of our business. Such forward-looking information reflects our current beliefs and is based on information currently available to us, including certain key expectations and assumptions concerning: anticipated crop yields and production in our market areas; the financial and operating attributes of acquired businesses and the anticipated future performance thereof; the value of acquired businesses and assets and the liabilities assumed (and indemnities provided) by AGI in connection therewith; anticipated financial performance; future debt levels; business prospects and strategies, including the success of our operational excellence initiatives; product and input pricing; the scope, nature, timing and cost of re-supplying certain equipment and re-completing certain work that has previously been supplied or completed pursuant to warranty obligations or otherwise; regulatory developments; tax laws; the sufficiency of budgeted capital expenditures in carrying out planned activities; currency exchange rates, inflation rates and interest rates; the cost of materials, labour and services and the impact of inflation rates and/or supply chain disruptions thereon; the impact of competition; the general stability of the economic and regulatory environment in which the Company operates; the timely receipt of any required regulatory and third party approvals; the ability of the Company to obtain and retain qualified staff and services in a timely and cost efficient manner; the amount and timing of the dividends that we expect to pay; the ability of the Company to obtain financing on acceptable terms; the regulatory framework in the jurisdictions in which the Company operates; the ability of the Company to successfully market its products and services; and that the COVID-19 pandemic will not have a material impact on our business, operations, and financial results going forward. Forward-looking information involves significant risks and uncertainties. A number of factors could cause actual results to differ materially from results discussed in the forward-looking information. These risks and uncertainties include but are not limited to the following: general economic and business conditions and changes in international, national and local macroeconomic and business conditions, as well as sociopolitical conditions in certain local or regional markets, including as a result of the conflict between Russia and Ukraine and the response thereto from other countries and institutions (including trade sanctions and financial controls), which has created volatility in the global economy and could continue to adversely impact economic and trade activity; the effects of global outbreaks of pandemics or contagious diseases or the fear of such outbreaks, such as the coronavirus (COVID-19) pandemic, including on our operations, our personnel, our supply chain, the demand for our products and services, our ability to expand and produce in new geographic markets or the timing of such expansion efforts, and on overall economic conditions and customer confidence and spending levels; the ability of management to execute the Company’s business plan; fluctuations in agricultural and other commodity prices, interest rates, inflation rates and currency exchange rates; crop planting, crop conditions and crop yields; weather patterns, the timing of harvest and conditions during harvest; volatility of production costs, including the risk of production cost increases that may arise as a result of ongoing high inflation rates and/or supply chain disruptions, and the risk that we may not be able to pass along all or any portion of increased costs to customers; governmental regulation of the agriculture and manufacturing industries, including environmental and climate change regulation; actions taken by governmental authorities, including increases in taxes, changes in government regulations and incentive programs, and actions taken in connection with local or global outbreaks of pandemics or contagious diseases or the fear of such outbreaks, such as the COVID-19 pandemic; risks inherent in marketing operations; credit risk; the availability of credit for customers; seasonality and industry cyclicality; potential delays or changes in plans with respect to capital expenditures; the cost and availability of sufficient financial resources to fund the Company’s capital expenditures; failure of the Company to realize the benefits of its operational excellence initiatives; incorrect assessments of the value of acquisitions, failure of the Company to realize the anticipated benefits of acquisitions, including to realize anticipated synergies and margin improvements, and the assumption of liabilities associated with acquisitions and/or the provision of indemnities to vendors in respect of any such assumed liabilities or otherwise; volatility in the stock markets including the market price of the Common Shares and in market valuations; competition for, among other things, customers, supplies, acquisitions, capital and skilled personnel; the availability of capital on acceptable terms; dependence on suppliers; changes in labour costs and the labour market, including the risk of labour cost increases that may arise as a result of ongoing high inflation rates and/or a scarcity of labour; the impact of climate change and related laws and regulations; changes in trade relations between the countries in which the Company does business, including between Canada and the United States; cyber security risks; adjustments to and delays or cancellation of backlogs; the requirement to re-supply equipment or re-complete work previously supplied or completed at AGI’s cost, and the risk that AGI’s assumptions and estimates made in respect of such costs and underlying the provision for warranty accrual and remediation in our consolidated financial statements related thereto and insurance coverage therefor will prove to be incorrect as further information becomes available to AGI; and the risk of litigation or unsuccessful defense of litigation in respect of equipment or work previously supplied or completed or in respect of other matters and the risk that AGI incurs material liabilities in connection with such litigation that are not covered by insurance in whole or in part. These risks and uncertainties are described under “Risks and Uncertainties” in our MD&A and in our most recently filed Annual Information Form, all of which are available under the Company's profile on SEDAR [www.sedar.com]. These factors should be considered carefully, and readers should not place undue reliance on the Company’s forward-looking information. We cannot assure readers that actual results will be consistent with this forward-looking information. Further, AGI cannot guarantee that the anticipated revenue from its backlogs will be realized or, if realized, will result in profits or Adjusted EBITDA. Delays, cancellations and scope adjustments occur from time-to-time with respect to contracts reflected in AGI's backlogs, which can adversely affect the revenue and profit that AGI actually receives from its backlogs. Readers are further cautioned that the preparation of financial statements in accordance with IFRS requires management to make certain judgments and estimates that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent liabilities. These estimates may change, having either a negative or positive effect on profit, as further information becomes available and as the economic environment changes. Without limitation of the foregoing, the provision for remediation related to the bin collapse incident disclosed in our MD&A required significant estimates and judgments about the scope, nature, timing and cost of work that will be required. It is based on management’s assumptions and estimates at the current date and is subject to revision in the future as further information becomes available to the Company. The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. The forward-looking information included in this press release is made as of the date of this press release and AGI undertakes no obligation to publicly update such forward-looking information to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

FINANCIAL OUTLOOK

Also included in this press release is an estimate of AGI's 2023 adjusted EBITDA, which is based on, among other things, the various assumptions disclosed in this news release including under "Forward-Looking Information" and including our assumptions regarding the Adjusted EBITDA contribution that AGI anticipates receiving from revenue growth in 2023 in part as a result of the 10% YOY increase in AGI's backlogs at December 31, 2022. To the extent such estimate constitutes a financial outlook, it was approved by management on March 7, 2023 and is included to provide readers with an understanding of AGI's anticipated 2023 adjusted EBITDA based on the assumptions described herein and readers are cautioned that the information may not be appropriate for other purposes.

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¹ Historical or forward-looking non-IFRS financial measure. See "Non-IFRS and Other Financial Measures".
- Fourth quarter 2022 loss before income taxes of $77 million vs $22 million on a YOY basis
- Full year 2022 loss before income taxes of $45 million vs profit before income taxes of $9 million on a YOY basis
² Non-IFRS ratio. See "Non-IFRS and Other Financial Measures".
³ Supplementary financial measure. See "Non-IFRS and Other Financial Measures".