Alithya Group inc 6-K, filed Feb 14, 2023

Alithya Group inc (ALYAF)

6-K 2023-02-14 For: 2022-12-31

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Added on July 04, 2026

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Alithya Group inc filed this 6-K on February 14, 2023.

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ALITHYA GROUP INC.

/s/ Nathalie Forcier
Name: Nathalie Forcier
Title: Chief Legal Officer and Corporate Secretary
Date: February 14, 2023


99.1			Interim Condensed Consolidated Financial Statements of Alithya Group inc. for the three months ended December 31, 2022
99.2			Management’s Discussion and Analysis of Financial Condition and Results of Operations for the three months ended December 31, 2022
99.3			Chief Executive Officer Certification of Interim Filings
99.4			Chief Financial Officer Certification of Interim Filings


		Page
Interim Consolidated Statements of Operations and Comprehensive Loss		3
Interim Consolidated Statements of Financial Position		4
Interim Consolidated Statements of Changes in Shareholders’ Equity		5
Interim Consolidated Statements of Cash Flows		6
Notes to Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021
1.	Governing statutes and nature of operations	7
2.	Basis of preparation	7
3.	Business combination	11
4.	Intangibles	14
5.	Goodwill	15
6.	Long-term debt	15
7.	Share capital	17
8.	Related parties	20
9.	Earnings per share	20
10.	Additional information on consolidated loss	21
11.	Business acquisition, integration and reorganization costs	22
12.	Net f inancial expenses	22
13.	Supplementary cash flow information	23
14.	Segment information	23
15.	Financial instruments	26


		For the three months ended December 31,		For the nine months ended December 31,
(in thousands of Canadian dollars, except per share data) (unaudited)		2022	2021	2022	2021
	Notes	$	$	$	$
Revenues	14	130,780	109,713	386,477	317,911
Cost of revenues	10	91,562	81,456	275,435	232,841
Gross margin		39,218	28,257	111,042	85,070

Operating expenses
Selling, general and administrative expenses	10	31,196	25,002	90,544	72,634
Business acquisition, integration and reorganization costs	11	1,290	857	5,913	5,489
Depreciation	10	1,634	1,400	4,815	4,200
Amortization of intangibles	4	7,397	3,438	18,804	10,268
Foreign exchange loss (gain)		163	(27)	63	(1)
		41,680	30,670	120,139	92,590
Operating loss		(2,462)	(2,413)	(9,097)	(7,520)
Net financial expenses	12	2,664	1,203	6,758	3,227

Loss before income taxes		(5,126)	(3,616)	(15,855)	(10,747)
Income tax expense (recovery)
Current		159	62	207	(134)
Deferred	10	220	(192)	(5,958)	(2,318)
		379	(130)	(5,751)	(2,452)
Net loss		(5,505)	(3,486)	(10,104)	(8,295)

Other comprehensive income
Items that may be classified subsequently to profit or loss
Cumulative translation adjustment on consolidation of foreign subsidiaries		(668)	(171)	5,560	456
		(668)	(171)	5,560	456
Comprehensive loss		(6,173)	(3,657)	(4,544)	(7,839)

Basic and diluted loss per share	9	(0.06)	(0.04)	(0.11)	(0.10)


As at		December 31,	March 31,
(in thousands of Canadian dollars) (unaudited)		2022	2022
	Notes	$	$
Assets
Current assets
Cash		24,019	17,655
Restricted cash		—	3,254
Accounts receivable and other receivables		92,804	100,867

Unbilled revenues		18,821	17,272
Tax credits receivable		12,415	8,515
Prepaids		6,328	6,162
		154,387	153,725
Non-current assets

Tax credits receivable		9,080	11,873
Other assets		1,204	1,303
Property and equipment		10,048	10,412
Right-of-use assets		13,212	15,146
Intangibles	4	111,376	101,927
Deferred tax assets		6,435	7,247
Goodwill	5	167,670	146,088
		473,412	447,721

Liabilities and Shareholders' Equity
Current liabilities
Accounts payable and accrued liabilities		87,882	89,660
Deferred revenues		22,653	20,409

Current portion of lease liabilities		3,837	3,510
Current portion of long-term debt	6	12,816	19,316
		127,188	132,895
Non-current liabilities
Long-term debt	6	116,948	87,360
Lease liabilities		15,615	17,753
Deferred tax liabilities		9,501	9,962
		269,252	247,970
Shareholders' equity
Share capital	7	311,492	305,222
Deficit		(121,503)	(111,654)
Accumulated other comprehensive income (loss)		4,613	(947)
Contributed surplus		9,558	7,130
		204,160	199,751
		473,412	447,721


Interim Consolidated Financial Statements of Alithya Group inc. For the three and nine months ended December 31, 2022 and 2021 (unaudited)


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 3


For the nine months ended December 31, (in thousands of Canadian dollars, except share data) (unaudited)
	Notes	Shares outstanding	Share capital	Deficit	Accumulated other comprehensive income (loss)	Contributed surplus	Total
		Number	$	$	$	$	$
Balance as at March 31, 2022		92,725,616	305,222	(111,654)	(947)	7,130	199,751
Net loss		—	—	(10,104)	—	—	(10,104)
Other comprehensive income		—	—	—	5,560	—	5,560
Total comprehensive income (loss)		—	—	(10,104)	5,560	—	(4,544)
Share-based compensation	7	—	—	—	—	1,875	1,875
Share-based compensation granted on business acquisition	7	—	—	—	—	2,261	2,261
Issuance of Subordinate Voting Shares pursuant to vesting of share-based compensation granted on business acquisitions	7	738,382	1,708	—	—	(1,708)	—
Issuance of Subordinate Voting Shares in consideration of the acquisition of Datum, net of share issuance costs	3, 7	1,867,262	5,528	—	—	—	5,528
Issuance of Subordinate Voting Shares in consideration of the acquisition of Trafic 3W inc., net of share issuance costs	4, 7	83,449	276	—	—	—	276
Shares purchased for cancellation	7	(354,012)	(1,242)	255	—	—	(987)
Total contributions by shareholders		2,335,081	6,270	255	—	2,428	8,953
Balance as at December 31, 2022		95,060,697	311,492	(121,503)	4,613	9,558	204,160

Balance as at March 31, 2021		58,695,438	197,537	(96,190)	(508)	7,173	108,012
Net loss		—	—	(8,295)	—	—	(8,295)
Other comprehensive income		—	—	—	456	—	456
Total comprehensive income (loss)		—	—	(8,295)	456	—	(7,839)
Share-based compensation		—	—	—	—	1,349	1,349
Share-based compensation granted on business acquisition		—	—	—	—	1,343	1,343
Issuance of Subordinate Voting Shares in consideration of the acquisition of R3D Consulting Inc.		25,182,676	80,585	—	—	—	80,585
Issuance of Subordinate Voting Shares pursuant to vesting of share-based compensation granted on business acquisitions		534,132	1,849	—	—	(1,849)	—
Shares purchased for cancellation		(230,600)	(761)	(6)	—	—	(767)
Issuance of Subordinate Voting Shares from exercise of stock options		1,500	6	—	—	(2)	4
Total contributions by, and distributions to, shareholders		25,487,708	81,679	(6)	—	841	82,514
Balance as at December 31, 2021		84,183,146	279,216	(104,491)	(52)	8,014	182,687


	For the three months ended December 31, 2021			For the nine months ended December 31, 2021
	As previously reported	Adjustment	Restated amount	As previously reported	Adjustment	Restated amount
	$	$	$	$	$	$
Net cash from operating activities	10,148	905	11,053	3,151	2,381	5,532
Net cash (used in) from financing activities	(24,566)	(905)	(25,471)	256	(2,381)	(2,125)


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 10


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 11


Acquisition of Datum						$
Current assets
Cash						2,798
Accounts receivable and other receivables						3,552
Unbilled revenue						1,301
Prepaids						159
						7,810
Non-current assets

Other assets						2
Property and equipment						55
Right-of-use assets						135
Intangibles (note 4)						22,525

Goodwill						14,830
Total assets acquired						45,357

Current liabilities
Accounts payable and accrued liabilities						4,255

Deferred revenue						945
Current portion of lease liabilities						71

						5,271
Non-current liabilities

Lease liabilities						64

Deferred tax liabilities						5,987
Total liabilities assumed						11,322

Net assets acquired						34,035


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 12


Acquisition of Datum						$
Consideration transferred settled in cash						17,430
Issuance of 1,867,262 Subordinate Voting Shares (note 7)						5,552
Balance of purchase payable with a nominal value of US$9,345,000 ($12,028,000) (note 6)						11,053
Total consideration transferred						34,035


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 13


As at	December 31, 2022					March 31, 2022
	Customer relationships	Software	Tradenames	Non-compete agreements	Total	Customer relationships	Software	Non-compete agreements	Total
	$	$	$	$	$	$	$	$	$
Opening cost	145,966	4,989	—	6,886	157,841	67,720	4,334	6,902	78,956
Additions, purchased	—	8	—	—	8	—	22	—	22
Additions through business acquisition (a) (note 3)	12,040	8,238	2,188	515	22,981	78,804	296	—	79,100
Additions, internally generated	—	756	—	—	756	—	1,339	—	1,339
Disposals / retirements	—	—	—	—	—	—	(999)	—	(999)
Foreign currency translation adjustment	3,797	422	114	175	4,508	(558)	(3)	(16)	(577)
Subtotal	161,803	14,413	2,302	7,576	186,094	145,966	4,989	6,886	157,841
Opening accumulated amortization	49,958	2,741	—	3,215	55,914	38,033	2,471	1,862	42,366
Amortization	15,306	2,406	—	1,092	18,804	11,925	1,007	1,353	14,285
Disposals / retirements	—	—	—	—	—	—	(737)	—	(737)

Subtotal	65,264	5,147	—	4,307	74,718	49,958	2,741	3,215	55,914
Net carrying amount	96,539	9,266	2,302	3,269	111,376	96,008	2,248	3,671	101,927


As at	December 31, 2022
	Canada	France	EPM US	ERP US	Not allocated (b)	Total
	$	$	$	$	$	$
Beginning balance as at April 1, 2022	77,135	128	8,852	29,005	30,968	146,088
Business acquisition (a) (note 3)	1,270	—	—	—	13,781	15,051
Foreign currency translation adjustment	—	7	750	2,456	3,318	6,531
Net carrying amount	78,405	135	9,602	31,461	48,067	167,670


As at	March 31, 2022
	Canada	France	EPM US	ERP US	Not allocated	Total
	$	$	$	$	$	$
Beginning balance as at April 1, 2021	34,644	137	8,915	29,210	—	72,906
Business acquisition	42,491	—	—	—	31,498	73,989
Foreign currency translation adjustment	—	(9)	(63)	(205)	(530)	(807)
Net carrying amount	77,135	128	8,852	29,005	30,968	146,088


As at	December 31,	March 31,
	2022	2022
	$	$
Senior secured revolving credit facility (the “Credit Facility”) (a)	85,301	66,631
Secured loans (b)	13,192	8,596
Subordinated unsecured loans (c)	20,000	17,500
Balance of purchase price payable paid in April 2022	—	3,100
Balance of purchase price payable paid in October 2022	—	1,748
Balance of purchase price payable paid in December 2022 (March 31, 2022 - US$6,825,000)	—	8,178
Balance of purchase price payable with a nominal value of $12,653,000 (US$9,345,000), non-interest bearing (4.4% effective interest rate), payable in annual installments of $4,218,000 (US$3,115,000), maturing on July 1, 2025	11,877	—
Deferral of employment tax payments (March 31, 2022 - US$1,219,000)	—	1,521
Other	—	120
Unamortized transaction costs (net of accumulated amortization of $1,035,000 and $754,000)	(606)	(718)
	129,764	106,676
Current portion of long-term debt	12,816	19,316
	116,948	87,360


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 14


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 15


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 16


	Subordinate Voting Shares		Multiple Voting Shares
	Number of shares	$	Number of shares	$
Beginning balance as at April 1, 2022	85,554,000	300,901	7,171,616	4,321
Shares issued pursuant to vesting of share-based compensation granted on business acquisitions	738,382	1,708	—	—
Shares issued in consideration of the acquisition of Datum (note 3)	1,867,262	5,528	—	—
Shares issued in consideration of the acquisition of Trafic 3W inc. (note 4)	83,449	276	—	—
Shares purchased for cancellation	(354,012)	(1,242)	—	—
Ending balance as at December 31, 2022	87,889,081	307,171	7,171,616	4,321


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 17


	Number of stock options	Weighted average exercise price
		$
Beginning balance as at April 1, 2022	4,084,082	3.23
Granted	891,355	3.25
Forfeited	(124,475)	3.70
Expired	(170,000)	3.59

Ending balance as at December 31, 2022	4,680,962	3.26
Exercisable as at December 31, 2022	1,937,005	3.41


	For the nine months ended December 31,
	2022
Weighted average assumptions
Share price	$3.25
Exercise price	$3.25
Risk-free interest rate	3.50	%
Expected volatility*	35.0	%
Dividend yield	—
Expected option life (years)	6.6
Vesting conditions – time (years)	3.3


						Number of DSU

Beginning balance as at April 1, 2022						439,521
Granted						173,647

Ending balance as at December 31, 2022						613,168


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 18


						Number of PSUs

Beginning balance as at April 1, 2022						332,263
Granted						528,120
Ending balance as at December 31, 2022						860,383


	For the three months ended December 31,		For the nine months ended December 31,
	2022	2021	2022	2021
	$	$	$	$
Stock option plans	251	236	737	634
Share purchase plan – employer contribution	331	298	1,025	825
Share-based compensation granted on business acquisitions	1,019	382	2,261	1,343
Deferred share units	159	132	432	441
Restricted share units	—	—	—	92
Performance share units	239	91	706	182
	1,999	1,139	5,161	3,517


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 19


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 20


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 21


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 22


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 23


	For the three months ended December 31, 2022
	Canada	U.S.	International	Total
	$	$	$	$
Revenues	77,512	48,885	4,383	130,780
Operating income by segment	10,094	7,213	308	17,615
Head office general and administrative expenses				9,593
Business acquisition, integration and reorganization costs				1,290
Foreign exchange loss				163
Operating income before depreciation and amortization				6,569
Depreciation and amortization				9,031
Operating loss				(2,462)


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 24


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 25


Alithya Group inc. – Interim Consolidated Financial Statements for the three and nine months ended December 31, 2022 and 2021			\| 26