Colabor Group Reports Results for the Third Quarter 2025 and Provides a Corporate Update

Core Insights - Colabor Group Inc. reported a significant increase in sales for the third quarter of 2025, with a 31.1% rise to $212.5 million compared to $162.0 million in the same period of 2024 [8][17] - The company experienced a net loss from continuing operations of $74.4 million, a stark contrast to net earnings of $1.2 million in the previous year, primarily due to an impairment charge on goodwill [8][19] - Kelly Shipway has been appointed as the new President and CEO, succeeding Louis Frenette, as part of a structured succession plan aimed at enhancing customer experience and profitability [3][5][7] Financial Performance - Adjusted EBITDA decreased to $5.8 million, representing a margin of 2.7% of sales, down from $9.5 million and 5.9% in the same quarter of 2024 [8][18] - Cash flow from operating activities was negative at $(7.7) million, compared to $9.9 million in the third quarter of 2024 [8][23] - Net debt increased significantly to $112.1 million from $47.8 million at the end of 2024, reflecting the impact of recent acquisitions and financial restructuring [8][24] Operational Developments - The integration of Alimplus's activities is underway, with plans to close specific sites by early 2026 to achieve cost savings and operational efficiencies [11][16] - The company has entered into forbearance agreements with lenders, extending until January 30, 2026, to address anticipated defaults and stabilize its financial position [8][27] - A cybersecurity incident in July 2025 negatively impacted sales and operational performance, contributing to the overall financial challenges faced during the quarter [8][15] Market Position and Strategy - Colabor aims to solidify its role as a leader in foodservice distribution in Quebec and Canada, focusing on profitable growth and enhanced service quality [10][9] - The company is prioritizing the management of working capital and debt reduction while implementing the integration plan for Alimplus [26] - The recent acquisition of Alimplus is expected to provide long-term growth opportunities, despite short-term challenges related to integration and market conditions [11][26]