This past year is a significant milestone for Premier Tech as it marks the last year of our first century and, even more so, the first fiscal year in which we generated over $1 billion in revenue.
Sales revenue grew from $982 million in fiscal 2021 to $1 095 million in 2022. This $113 million increase represents 11.5% growth and tops off more than 30 years of average annual growth above 10%. Our strong performance this past year is all the more noteworthy in that 79% of the increase, or $89 million, is organic growth, while acquisitions account for $24 million, or 21%.
These figures testify to the trust our clients put in us and how much they value our services and technologies. They also reflect the strength of our brands in all the markets where Premier Tech operates. But this steady and sustained growth would be impossible without the commitment and hard work of thousands of team members around the world who have made Premier Tech a success story for nearly a century.
Today we want to thank all those who have played a key role in our journey since 1923 — our clients and team members. Thank you, dear clients, for your trust over the years and thank you to all team members for the passion you show daily.
This kind of performance and growth over time is no accident. For over 30 years, Premier Tech has diligently planned and executed its strategic development plan. Together as a team, we move forward with a clear vision and a meaningful Purpose. We have had our eye on the $1 billion mark for a few years, and hitting the target is yet another proof of what we can accomplish and our ability to achieve our full potential. Furthermore, it is a clear and solid message from our clients of how they value what we bring to them.
Crossing the billion-dollar threshold is particularly meaningful as we prepare to celebrate our 100th anniversary. We have come this far by staying true to ourselves and our Purpose — which brings together People and Technologies in order to help make a difference by feeding, protecting, and improving our world. Just as we are turning 100 years young, this acts as a foundation for the next chapter in our already rich history while we are accelerating forward.
Given the unusual and complex circumstances of the past two years, our performance is the expression of the resilience of our markets and our strong relationships with clients and suppliers. In fiscal 2022, our global and local presence combined with the agility of our teams helped us navigate even bigger and more complex challenges than the previous year. Faced with major disruptions affecting the global supply chain, logistics and transportation along with a tight labour market, and many other challenges, our teams went the extra mile to continue delivering on our commitments and our promise to our clients.
Strategic planning is core to how we operate at Premier Tech. It guides our decisions and actions and has been key to our sustained and profitable growth over the years. Doing this allows us to set the strategies and objectives that create business velocity and at the same time, enables us to be agile enough to deal with the unexpected. The process of building our VISION 2027 strategic plan this past year gave us the opportunity to engage in conversations with numerous internal and external stakeholders, allowing us to take a step back to compare and analyze our situation and project ourselves into the future. Ultimately, the goal of our strategic planning process is to determine the objectives, strategies, and actions that will ensure our steady progress and development.
Investing for the future
Premier Tech has consistently and successfully balanced its capital investment portfolio to position itself to seize opportunities and fuel growth. Whether it is investing in our buildings and workspaces, manufacturing capacity, or management information systems, our approach is proactive and consistent with our strategic plans. This past year saw a significant increase in capital investment, from $27 million in fiscal 2021 to over $74 million in 2022. This surge in investments is the result of sustained sales growth in recent years — an increase of nearly $375 million since 2017 — and a corresponding increase in our manufacturing network along with new investments as part of VISION 2027.
- $10 million to increase manufacturing capacity and add a furnace to produce perlite — an ingredient in our growing media — at the Rexton plant in New Brunswick in our Growers and Consumers business group.
- €3 million to increase rotational moulding capacity at two plants that are part of our Water and Environment business group in France.
- More than $9 million for the acquisition of a plant in Salt Lake City to upgrade the manufacturing infrastructure and installation of our Systems and Automation business group.
- Nearly $2 million to upgrade some of our installations — offices and plants — at the Premier Tech World Headquarters in Rivière-du-Loup.
- $47 million over five years to help modernize and boost production capacity at two plants in our Growers and Consumers business group in Ontario.
At Premier Tech, we are firm believers in open, direct, and transparent communication, coupled with a desire to master our destiny. That is why we maintain an ongoing conversation with financial markets and structure our financing ourselves, with no intermediaries or filters, ensuring the coordination of our efforts. While this may seem like an anachronistic approach for a company of our size, we are committed to finding innovative solutions to maintain it. Our approach opens up opportunities for discussion and dialogue and connects us with people who provide insight, ask the right questions, and challenge us. That, in itself, brings added value to Premier Tech and its entire ecosystem.
In fiscal 2022, we launched a major refinancing operation that was completed at the very beginning of fiscal 2023. An extension of our strategic planning process, the operation aimed to lay the groundwork for VISION 2027 and prepare Premier Tech for a new phase of growth and development over the next 10 to 15 years. As part of this operation, we decided to diversify our lender portfolio by adding new collaborators to our lineup of long-standing financial partners. The financial structure put in place will ensure we have the funds we need for our growth over a 3 to 5-year period, for both acquisitions and capital projects.
- A new secured term loan facility totalling $300 million with a group of six financial partners, including three long-standing ones — Farm Credit Canada (25 years), Business Development (15 years), and Roynat Inc. (25 years) — and three new ones, namely Desjardins, HSBC Bank of Canada, and TD Canada Trust.
- A new round of unsecured loans totalling $110 million with Fonds de solidarité FTQ (35 years) and Capital régional et coopératif Desjardins.
- 5-year extension and increase to $200 million of our line of credit with the same long-standing partners, namely, CIBC (15 years) and Bank of Montreal (10 years).
By building a long-term relationship with our partners, we benefit from short and long-term loan agreements with much longer than standard timeframes ranging from 5 years for the short term to 8 years for the long term. These agreements with specific partners for each type of loan enable us to move ahead on our various projects and secure delivering upon our ambition. The success of this operation highlights our credibility on the financial markets, which we have earned through long-term relationships with our financial partners and, obviously, through our track record of sustained and profitable growth.
Expanding our foundation for organic growth
In light of high valuation expectations in the marketplace, we had less velocity in making acquisitions in fiscal 2022 compared to other periods of turbulence, like the financial crisis of 2008-2009, following which we closed on nine strategic and capacity-building acquisitions over the course of an 18-month period. In terms of deal flow, we saw lots of opportunities but we maintained the same financial discipline, buying for the long term and at a price that will generate an appropriate rate of return on investment.
That said, we nevertheless accelerated the rollout of our digital offering by acquiring Québec-based company Mirego in a transaction finalized at the very beginning of fiscal 2022. This acquisition is part of our Digital business group’s vision of delivering end-to-end services to its clients and supporting them throughout their digital journey, from transitioning manufacturing facilities to industry 4.0, to developing their own digital products and the digitalization of their commercial processes.
In late fiscal 2022 we also acquired the 50% ownership we did not own in the joint venture we had with Ferti Technologies, a Québec-based company. Launched in 2015, Premier Ferti Tech is based in Niagara Falls, Ontario, and has the mandate of conditioning and packaging lawn fertilizers as well as Alaskan winter defence products. The manufacturing facility is now fully part of our Growers and Consumers business group.
In a first transaction for our Life Sciences business group, we also became the majority shareholder of Virentia. Specializing in extracting chloroplasts and bioactive molecules from alfalfa, this Québec start-up, launched in 2016, and based in Becancour is now part of Premier Tech’s growing effort in the field of human and animal health and nutrition. Premier Tech was one of the early investors back in 2018 and increased its stake as Virentia was investing close to $50 million in a state-of-the-art manufacturing facility in 2021.
Another transaction early in fiscal 2023 broadened the scope of our commercial offer in smart manufacturing and digital transformation. The acquisition of Arima, a Québec company who has developed and commercializes the cloud-based software Syncrun — an advanced production planning and scheduling solution —, enables us to better support our clients in their productivity and efficiency challenges.
Our Growers and Consumers business group also acquired the operational assets of Northwoods Organics of Minnesota, a U.S. peat producer, at the start of fiscal 2023. In addition to increasing our production capacity, the acquisition secures our access to strategic peat reserves in North America.
In keeping with our desire to make a difference in communities where we are active, pave the way for the next generation, collaborate for the long term and build on the value of diversity, Premier Tech is proud to be a founding member of HIFA — which means “Halles d’innovation et de formation avancée” in French — a collaborative research and development hub set up jointly by Premier Tech and the Université du Québec à Chicoutimi Entrepreneurship and Spin-Off Center, the Québec Center for Aluminum Research and Development (CQRDA), and the Université du Québec à Rimouski. Fonds de solidarité FTQ, Desjardins Capital, and Cascades are also founding members. The first undertaking of its kind in Québec, HIFA is an innovative project aiming to support companies in their Industry 4.0 shift whether it is automation of industrial processes or digitalization.
100 years young
We undertake fiscal 2023 with confidence and conviction, building on our strong foundations and rich history. We are resolutely focused on the future, but mindful of supply chain challenges and the ongoing economic turbulence in global markets. Our actions and outlook for the coming year are fuelled by the depth and breadth of our experienced teams and the energy they bring to the table every day. These building blocks move us forward and will carry us into our second century, where we can count on our strong financial footing, our knowledge and our expertise, but most importantly on everything we have learned in our first century of existence as well as the skill set and know-how of the Premier Tech Team, an enthusiastic and committed group of people with the tools and drive to deliver profitable growth into the long term.
This unwavering desire to have a lasting impact on people’s lives and deliver value to our clients is what motivates our teams and upholds our Purpose. We are confident that our promise to make a difference and support our clients and partners in their success will pave the way forward for us.
Now more than ever, this is our time.
This story is from the Premier Tech Report 2022.
Discover it now: www.premiertech.com/annual-report