REGINA, SASKATCHEWAN, CANADA – AGT Food and Ingredients Inc. (AGT) announced on May 11 that adjusted EBITDA was up 38.9% to C$31.4 million ($24.3 million) in the first quarter ended March 31.

That compares to earnings of C$22.6 million in the same period a year earlier.

The pulse and grain processing segment reported adjusted EBITDA of C$24 million, compared to C$17 million in the same period a year ago. The segment had revenue of C$300 million, up from C$272.4 million a year ago. 

The Food ingredients and packaged foods segment was consistent and represented 12.2% of total tonnes invoiced and 29.2% of adjusted EBITDA for the first quarter of 2016, compared to 14% of total tonnes invoiced and 30.71% of adjusted EBITDA in the first quarter of 2015.

Revenue was C$441.4 million for the first quarter, compared to C$385.2 million for the three months ended March 31, 2015. 

“We are pleased with the consistency with which our business is performing across our segments,” said Murad Al-Katib, president and chief executive officer. “The strides we have taken to diversify our business with regard to products, markets and seasonality are key drivers to AGT’s consistent performance. While products in Canada are near depleted due to strong customer demand-led export programs, the harvest in Australia has been a positive contributor and we may see record levels of lentils and peas in Canada in 2016, which we expect will extend positively to our business. Our traditional processing infrastructure and our new bulk handling assets are certainly well positioned to capitalize on these opportunities. Additionally, our food ingredient and packaged foods business is progressing, supporting our previously announced expansions in Minot.” 

AGT also announced the approval of the adoption of a shareholder rights plan. The rights plan is designed to encourage the fair treatment of shareholders in connection with a takeover bid for the outstanding common shares of AGT.

Under the terms of the rights plan, one right will be issued by the company in respect of each outstanding common share. The rights issued under the rights plan become exercisable only if a person acquires 20% or more of AGT’s outstanding common shares without complying with the permitted ID provisions of the rights plan or without the approval of the board. In this event, rights holders (other than the offeror, its affiliates, associates and joint actors) can acquire common shares at a substantial discount to the prevailing market price at the time that the rights become exercisable.

Permitted bids under the rights plan must be made to all holders of AGT’s common shares and must be open for acceptance for a minimum of 105 days (which period may be reduced in certain circumstances). If at the end of such prescribed period at least 50% of the outstanding common shares (other than those owned by the offeror, its affiliates, associates and joint actors) have been tendered and not withdrawn, the offeror may take up and pay for the common shares but must extend the take-over bid for a further 10 days to allow other shareholders to tender to such take-over bid.

The rights plan has been accepted for filing by the Toronto Stock Exchange, subject to shareholder ratification. AGT expects to seek shareholder approval and ratification of the Rights Plan at its upcoming annual and special meeting of shareholders to be held on June 15, 2016.