WINNIPEG, MB, Sept. 16, 2020 /CNW/ - Ag Growth
International Inc. ("AGI" or the "Company") previously announced
that a commercial grain storage bin manufactured by the Company and
located at a customer's export terminal in North Vancouver, BC, had collapsed.
The grain storage bin that collapsed is part of a new bin line
that was developed and manufactured by the Company over the past
two years in response to market demand. It is a larger
version of AGI's standard hopper line. This new bin line is unique
and distinct from the rest of AGI's product lines, including its
other grain storage bin products, and is not in place or being sold
to any other customers.
In May of 2019 a similar product in a substantially different
application and installed at a different site for a different
customer suffered a failure, the cause of which is unknown at this
time. Based on that event and out of an abundance of caution,
the Company undertook an extensive engineering re-evaluation of the
product prior to inclusion in two additional
applications.
15 of these bins (including the collapsed bin) are located at
the facility where the incident occurred and an additional 20 have
been manufactured and supplied to another customer but have not yet
been commissioned. The total sales value of these 35 bins is
approximately CAD $19.1
million.
The customer at the facility where the incident occurred has
asserted AGI's responsibility for the collapse, however,
the cause of and any responsibility for the incident have not
yet been determined. AGI's immediate focus is on working with
its customers to ensure the safety of all personnel and security of
their facilities. The recovery, investigation and remediation
may take a number of months to complete.
"We have reacted immediately, moving to work with our customers
to discover the cause of this incident," said Tim Close, President and CEO of AGI. "Our
primary concern is safety of personnel at the sites. Once
recovery of the site has been completed the investigation will
provide the facts for us to determine the required remediation and
the impact on AGI. We are confident that we can contain the
impact on AGI's business while collaborating with our customers to
effect any required remediation, and continuing the growth and
success across AGI.
We can also confirm continued robust performance of our business
particularly in North American Farm, in Brazil, EMEA, India, AGI Food, and AGI SureTrack and,
excluding any impacts from this incident, we are setting up for a
solid completion of 2020 with Adjusted EBITDA in the second half of
2020 trending higher than expected as at our second quarter
statements."
AGI Company Profile
AGI is a leading provider of solutions for the global food
infrastructure, including seed, fertilizer, grain, feed, and food
processing systems. AGI has manufacturing facilities in
Canada, the United States, the United Kingdom, Brazil, India, France
and Italy and distributes its
product globally.
Forward-Looking Information
This news release contains forward-looking statements and
information (collectively, "forward-looking information") within
the meaning of applicable securities laws that reflect the
Company's expectations regarding its future growth, results of
operations, performance, business prospects, and opportunities. All
information and statements contained herein that are not clearly
historical in nature constitute forward-looking information, and
the words "anticipate", "believe", "continue", "could", "estimate",
"expect", "intend", "plans", "postulates", "predict", "should",
"will" 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. 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 press release includes our
estimate of the length of time the recovery, investigation and
remediation may take; our belief that the investigation will
provide us with certain information; the belief that we will be
successful in securing and recovering the incident site and
collaborating with our customers to effect any required
remediation; the belief that we can contain the impact on AGI's
business and continue growth and success across AGI;
anticipated continued robust performance in our business; and
estimates of our second half fiscal performance, including with
respect to adjusted EBITDA. Such forward-looking information
reflects AGI's current beliefs and is based on information
currently available to us.
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, including changes in international, national and local
macroeconomic and business conditions, as well as sociopolitical
conditions in certain local or regional markets, weather patterns,
crop planting, crop yields, crop conditions, the timing of harvest
and conditions during harvest, the ability of management to execute
AGI's business plan, seasonality, industry cyclicality, volatility
of production costs, agricultural commodity prices, the cost and
availability of capital, currency exchange and interest rates, the
availability of credit for customers, competition, AGI's failure to
achieve the expected benefits of recent acquisitions including to
realize anticipated synergies and margin improvements; changes in
trade relations between the countries in which AGI does business
and elsewhere including between Canada and the
United States and between the
United States and China;
our ability to maintain strong relationships with our customers;
and the potential for the Company to incur costs and liabilities
related to the supply of defective or faulty equipment to its
customers. These risks and uncertainties are described under "Risks
and Uncertainties" in AGI's MD&A and in our most recently filed
Annual Information Form, all of which are available under AGI's
profile on SEDAR [www.sedar.com]. These factors should be
considered carefully, and readers should not place undue reliance
on AGI's forward-looking information. AGI cannot assure readers
that actual results will be consistent with this forward-looking
information. 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 or
the results of the investigation or other matters related to the
incident to reflect new information, subsequent events or otherwise
unless so required by applicable securities laws.
SOURCE Ag Growth International Inc. (AGI)
