WSP GLOBAL INC. WSP GLOBAL INC.
MANAGEMENT'S
DISCUSSION AND ANALYSIS
FOR THE THIRD QUARTER AND NINE-MONTH PERIOD ENDED
SEPTEMBER 25, 2021
November 9, 2021
ABOUT US
As one of the world's leading professional services firms, WSP provides engineering and design services to clients in the Transportation & Infrastructure, Property & Buildings, Earth & Environment, Power & Energy, Resources and Industry sectors, as well as offering strategic advisory services. WSP's global experts include engineers, advisors, technicians, scientists, architects, planners, surveyors and environmental specialists, as well as other design, program and construction management professionals. Our talented people are well positioned to deliver successful and sustainable projects, wherever our clients need us.
HEAD OFFICE WSP GLOBAL INC.
1600 RENE-LEVESQUE BLVD WEST, 11th FLOOR MONTREAL, QC H3H 1P9
CANADA
wsp.com
3
TABLE OF CONTENTS | ||
1 | MANAGEMENT'S DISCUSSION AND ANALYSIS.................................................................. | |
2 | NON-IFRSMEASURES .................................................................................................................. | |
3 | CORPORATE OVERVIEW.............................................................................................................. | |
4 | FINANCIAL HIGHLIGHTS............................................................................................................... | 7 |
5 | EXECUTIVE SUMMARY.................................................................................................................. | 7 |
6 | KEY EVENTS ...................................................................................................................................... | 8 |
7 | SEGMENT OPERATIONAL REVIEW .......................................................................................... | 9 |
8 | FINANCIAL REVIEW ....................................................................................................................... | 14 |
9 | LIQUIDITY ........................................................................................................................................... | 21 |
10 | EIGHT QUARTER SUMMARY....................................................................................................... | 24 |
11 | GOVERNANCE.................................................................................................................................. | 24 |
12 | SIGNIFICANT ACCOUNTING POLICIES................................................................................... | 25 |
13 | FINANCIAL INSTRUMENTS ......................................................................................................... | 25 |
14 | RELATED PARTY TRANSACTIONS............................................................................................ | 26 |
15 | OFF-BALANCESHEET AGREEMENTS ..................................................................................... | 26 |
16 | FORWARD-LOOKINGSTATEMENTS ....................................................................................... | 26 |
17 | RISK FACTORS ................................................................................................................................. | 27 |
18 | ADDITIONAL INFORMATION...................................................................................................... | 28 |
19 | GLOSSARY OF NON-IFRS MEASURES AND SEGMENT REPORTING MEASURES .. | 28 |
WSP Global Inc.
Management's Discussion and Analysis
Q3 - 2021
4
1 MANAGEMENT'S DISCUSSION AND ANALYSIS
The following management's discussion and analysis ("MD&A") of the consolidated financial position and consolidated results of operations, dated November 9, 2021, is intended to assist readers in understanding WSP Global Inc.
(the "Corporation" or "WSP") and its business environment, strategies, performance and risk factors. This MD&A should be read together with the Corporation's unaudited interim condensed consolidated financial statements and accompanying notes for the quarter and nine-month period ended September 25, 2021 as well as the Corporation's MD&A and audited consolidated financial statements and accompanying notes for the year ended December 31, 2020. The Corporation's unaudited interim condensed consolidated financial statements for the quarter and nine-month period ended September 25, 2021 have been prepared in compliance with IAS 34, "Interim Financial Reporting" as issued by the International Accounting Standards Board ("IASB"). All amounts shown in this MD&A are expressed in Canadian dollars, unless otherwise indicated. All information disclosed in this MD&A is based on unaudited figures.
This MD&A focuses on the Corporation's results for the third quarter and nine-month period ended September 25, 2021. The Corporation's second and third quarters are always comprised of 13 weeks of operations. However, the number of weeks of operations in the first and fourth quarters will vary as the Corporation has a statutory December 31 year end. The third quarter results include the period from June 27, 2021 to September 25, 2021 and the comparative third quarter results include the period from June 27, 2020 to September 26, 2020.
In this MD&A, references to the "Corporation", "we", "us", "our" and "WSP" or "WSP Global" refer to WSP Global Inc. Depending on the context, this term may also include subsidiaries and associated companies.
2 NON-IFRS MEASURES
The Corporation reports its financial results in accordance with IFRS. However, in this MD&A, the following non-IFRS measures are used by the Corporation: net revenues; adjusted EBITDA; adjusted EBITDA margin; adjusted net earnings; adjusted net earnings per share; backlog; free cash flow; days sales outstanding ("DSO"); and net debt to adjusted EBITDA ratio. These measures are defined in section 19, "Glossary of non-IFRS measures and segment reporting measures" and reconciliations to IFRS measures can be found in section 8, "Financial Review" and section 9, "Liquidity".
Management of the Corporation ("Management") believes that these non-IFRS measures provide useful information to investors regarding the Corporation's financial condition and results of operations as they provide additional key metrics of its performance. These non-IFRS measures are not recognized under IFRS, do not have any standardized meaning prescribed under IFRS and may differ from similarly-named measures as reported by other issuers, and accordingly may not be comparable. These measures should not be viewed as a substitute for the related financial information prepared in accordance with IFRS.
3 CORPORATE OVERVIEW
As one of the world's leading professional services firms, WSP provides engineering and design services to clients in the Transportation & Infrastructure, Property & Buildings, Earth & Environment, Power & Energy, Resources and Industry sectors, as well as offering strategic advisory services. WSP's global experts include engineers, advisors, technicians, scientists, architects, planners, environmental specialists and surveyors, in addition to other design, program and construction management professionals. WSP's talented people are well positioned to deliver successful and sustainable projects, wherever clients need us.
WSP Global Inc.
Management's Discussion and Analysis
Q3 - 2021
5
The Corporation's business model is centered on maintaining a leadership position in each of its end markets and the regions in which it operates by establishing a strong commitment to, and recognizing the needs of, surrounding communities, as well as local and national clients. WSP offers a variety of professional services throughout all project execution phases, from the initial development and planning studies through to the project and program management, design, construction management, commissioning and maintenance phases.
Under this business model, the Corporation benefits from regional offices with a full service offering. Functionally, sector leaders work together with regional leaders to develop and coordinate markets served, combining local knowledge and relationships with nationally recognized expertise. The Corporation has developed a multidisciplinary team approach whereby employees work closely with clients to develop optimized solutions.
The Corporation believes it has the capability and the depth of expertise to transform clients' visions into realities that are sustainable in every sense - commercially, technically, socially and environmentally.
The market sectors in which the Corporation operates are described below.
- Transportation & Infrastructure: The Corporation's experts advise, plan, design and manage projects for rail transit, aviation, highways, bridges, tunnels, water, maritime and urban infrastructure. Public and private sector clients, construction contractors and other partners seek WSP's expertise around the world to create mid and long-term transport and infrastructure strategies, and to provide guidance and support throughout the life-cycle of a wide range of projects. As WSP offers comprehensive, innovative and value-oriented solutions to assist clients in achieving their desired outcomes, the Corporation takes great pride in solving clients' toughest problems. WSP offers a full range of services locally with extensive global experience to successfully deliver projects, helping clients overcome challenges and respond to emerging areas in new mobility, resiliency, decarbonization and supply chain.
- Property & Buildings: WSP is a world-leading provider of technical and advisory services with a track record in delivering buildings of the highest quality. The Corporation can be involved at every stage of a project's life-cycle, from the business case, through design and construction, to asset management and refurbishment. The Corporation has teams of technical experts across the globe delivering engineering and consultancy services ranging from decarbonisation strategies and digital building design to structural and mechanical, electrical, and plumbing ("MEP") engineering. The Corporation is an expert in enabling clients to maximize the outcome of their projects in sectors from high-rise to healthcare, stadia to stations and commercial to cultural.
- Earth & Environment: The Corporation has specialists working with and advising businesses and governments in all key areas of earth sciences and environmental consultancy, including Environmental, Social and Governance ("ESG") matters. These experts deliver a broad range of services including air, land, water, health and climate change. They work with and advise clients on environmental matters ranging from due diligence, permitting authorizations and regulatory compliance, to consulting on disposal of hazardous materials, land remediation, environmental and social impact assessments, and employee health and safety. WSP's reputation has been built on helping clients worldwide mitigate risk, manage and reduce impacts, and maximize opportunities related to sustainability, climate change, energy use and the environment. The services are offered at any stage of the project or asset lifecycle, and range from field data collection, and site-based services, all the way up to helping our clients' executives make the best ESG decisions.
- Resources: The Corporation has the scale and expertise to support all its worldwide resource clients. In mining, WSP's experts work with clients throughout the project life-cycle - from conceptual, environmental and feasibility studies to addressing social acceptance issues, and from stand alone detailed engineering services, complete engineering, procurement, and construction management ("EPCM"), water management, tailings management, to site closure and rehabilitation. WSP expertise includes resource and reserve modelling, metallurgical testing, geotechnical and mine design and detailed engineering for mining infrastructure and waste facilities. In oil and gas, WSP helps clients with some of their most demanding technical and logistical challenges. The Corporation's experts advise on how to plan, design and support the development of pipelines and gas
WSP Global Inc.
Management's Discussion and Analysis
Q3 - 2021
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WSP Global Inc. published this content on 09 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2021 22:17:21 UTC.
