ATS Announces Normal Course Issuer Bid

Rhea-AI Summary

ATS (TSX and NYSE: ATS) has announced a new Normal Course Issuer Bid (NCIB) approved by the Toronto Stock Exchange. The company can purchase and cancel up to 8,259,180 common shares, representing 10% of its public float of 82,591,806 shares. The NCIB will run from December 16, 2024, to December 15, 2025.

Daily purchases will be to 65,819 shares, except where block purchase exemptions apply. The company views this share buyback as part of its capital structure strategy and complementary to acquisition growth plans. Under its previous 2023 NCIB, ATS repurchased and cancelled 1,021,187 shares at an average price of $44.07 per share.

Positive

• Authorization to repurchase up to 8,259,180 shares (10% of public float)
• Demonstrates management's confidence in company's valuation
• Previous buyback program successfully executed with 1,021,187 shares repurchased

Negative

• None.

Insights

Financial Analyst

This share buyback program signals strong financial confidence from ATS management. The ability to repurchase up to 10% of public float demonstrates robust cash flow generation and balance sheet strength. Previous buyback execution at $44.07 per share shows management's commitment to capital return while maintaining flexibility for acquisitions. The weighted average purchase price suggests management sees value at these levels, though they've only utilized about 12.7% of the previous authorization. The automatic purchase plan provision adds efficiency by allowing continued repurchases during blackout periods. While buybacks can provide price support and signal undervaluation, the moderate pace of previous purchases indicates a balanced approach to capital allocation between organic growth, M&A and shareholder returns.

Market Research Analyst

The renewal and expansion of the NCIB reflects a strategic approach to capital deployment. With a daily purchase limit of 65,819 shares, representing 25% of average daily volume, the program provides meaningful but measured support for the stock. The previous program's execution at $44.07 per share sets a benchmark for management's view of intrinsic value. The decision to continue buybacks while maintaining M&A optionality suggests management sees current valuation as attractive without compromising growth opportunities. This balanced strategy should appeal to both value and growth investors, though the relatively conservative pace of previous purchases indicates patience in execution.

CAMBRIDGE, Ontario--(BUSINESS WIRE)-- ATS Corporation (TSX and NYSE: ATS) (“ATS” or the “Company”), today announced that the Toronto Stock Exchange (“TSX”) has accepted a notice filed by it of its intention to make a normal course issuer bid (“NCIB”). As of December 2, 2024, ATS had a total of 97,926,826 common shares issued and outstanding. Under the NCIB, ATS will have the ability to purchase for cancellation up to a maximum of 8,259,180 common shares, representing approximately 10% of the public float of 82,591,806 common shares of the Company that were issued and outstanding as of December 2, 2024.

Purchases under the NCIB will be made through the facilities of the TSX and/or alternative Canadian trading systems in accordance with applicable regulatory requirements, during the twelve-month period commencing on December 16, 2024, and ending on or before December 15, 2025. The average daily trading volume of the common shares on the TSX for the six calendar months ending November 30, 2024, was 263,276 common shares. On any given trading day, ATS will not purchase more than 25% of such average daily trading volume, representing 65,819 common shares, except where such purchases are made in accordance with available block purchase exemptions. The common shares purchased under this NCIB will be cancelled.

Some purchases under the NCIB may be made pursuant to an automatic purchase plan that has been entered into between ATS and its broker. This plan will enable the purchase of ATS common shares when ATS would not ordinarily be active in the market due to internal trading blackout periods, insider trading rules, or otherwise.

ATS believes that there are times when the market price of its common shares may not reflect their underlying value and that the purchase of shares by ATS will both provide liquidity to existing shareholders and benefit remaining shareholders. The NCIB is viewed by ATS management as one component of an overall capital structure strategy and complementary to its acquisition growth plans.

The NCIB follows the Company’s normal course issuer bid for the period ended December 14, 2024 (the “2023 NCIB”). Under the 2023 NCIB, the Company had obtained approval to purchase up to 8,044,818 common shares. The Company’s 2023 NCIB began on December 15, 2023 and will end on December 14, 2024. Within the past 12 months, under the 2023 NCIB, the Company repurchased through the facilities of the TSX and/or alternative Canadian trading systems, and cancelled, 1,021,187 common shares at a weighted average purchase price of $44.07 per common share.

About ATS Corporation

ATS Corporation is an industry-leading automation solutions provider to many of the world's most successful companies. ATS uses its extensive knowledge base and global capabilities in custom automation, repeat automation, automation products and value-added solutions including pre-automation and after-sales services, to address the sophisticated manufacturing automation systems and service needs of multinational customers in markets such as life sciences, transportation, food & beverage, consumer products, and energy. Founded in 1978, ATS employs over 7,500 people at more than 65 manufacturing facilities and over 85 offices in North America, Europe, Southeast Asia and Oceania. The Company's common shares are traded on the Toronto Stock Exchange and the New York Stock Exchange under the symbol ATS.

Forward-looking Statements

Certain information contained in this press release may constitute forward-looking information under applicable securities laws, including statements related to ATS’ intentions with respect to the NCIB and purchases thereunder and the effects of repurchases under the bid. Forward-looking statements, by their very nature, involve inherent risks and uncertainties and are based on several assumptions, both general and specific. Much of this information can be identified by looking for words such as “believe”, “expects”, “expected”, “will”, “intends”, “projects”, “anticipates”, “estimates”, “continues” or similar words. Purchases made under the NCIB are not guaranteed and may be suspended at the discretion of ATS’ Board of Directors. Forward-looking statements are based on current information and expectations that involve a number of risks and uncertainties, which could cause actual results to differ materially from those anticipated. Forward-looking statements contained in this press release are made as of the date hereof and are subject to change. ATS assumes no obligation to revise or update forward looking statements to reflect new circumstances, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241212696486/en/

For more information, contact:

David Galison

Head of Investor Relations

ATS Corporation

730 Fountain Street North

Cambridge, ON, N3H 4R7

(519) 653-6500

dgalison@atsautomation.com

For general media inquiries, contact:

Matthew Robinson

Director, Corporate Communications

ATS Corporation

730 Fountain Street North

Cambridge, ON, N3H 4R7

(519) 653-6500

mrobinson@atsautomation.com

Source: ATS Corporation

FAQ

How many shares can ATS repurchase under its new NCIB program?

ATS can repurchase and cancel up to 8,259,180 common shares, representing 10% of its public float of 82,591,806 shares.

What is the duration of ATS's new share buyback program?

The new NCIB program runs from December 16, 2024, to December 15, 2025, a twelve-month period.

What was ATS's average share repurchase price under the 2023 NCIB?

Under the 2023 NCIB, ATS repurchased shares at a weighted average purchase price of $44.07 per common share.

What is the daily purchase limit for ATS's new share buyback program?

ATS cannot purchase more than 65,819 common shares per trading day, which represents 25% of the average daily trading volume, except when using block purchase exemptions.

How many shares did ATS repurchase under its 2023 NCIB program?

Under the 2023 NCIB, ATS repurchased and cancelled 1,021,187 common shares.