Wajax : Q4 2022 Financial Results (March 7, 2023)

Wajax

Financial Results - Q4 2022

March 7, 2023

Cautionary Statement

Regarding Forward-Looking Information

This presentation contains certain forward-looking statements and forward-looking information, as defined in applicable securities laws (collectively, "forward-lookingstatements"). These forward- looking statements relate to future events or the Corporation's future performance. All statements other than statements of historical fact are forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "anticipates", "intends", "predicts", "expects", "is expected", "scheduled", "believes", "estimates", "projects" or "forecasts", or variations of, or the negatives of, such words and phrases or state that certain actions, events or results "may", "could", "would", "should", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors beyond the Corporation's ability to predict or control which may cause actual results, performance and achievements to differ materially from those anticipated or implied in such forward-looking statements. To the extent any forward-looking information in this presentation constitutes future-oriented financial information or financial outlook within the meaning of applicable securities law, such information is being provided to demonstrate the potential of the Corporation and readers are cautioned that this information may not be appropriate for any other purpose. There can be no assurance that any forward-looking statement will materialize. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this presentation are made as of the date of this presentation, reflect management's current beliefs and are based on information currently available to management. Although management believes that the expectations represented in such forward-looking statements are reasonable, there is no assurance that such expectations will prove to be correct. Specifically, this presentation includes forward-looking statements regarding, among other things: our belief that the Corporation's strong balance sheet gives us the flexibility to invest in our expanded Hitachi relationship, additional organic initiatives and acquisition opportunities to help drive future growth; our belief that our strong ability to generate cash flow, coupled with over $300 million in availability on our bank credit facility, allows us to invest in organic growth and acquisition opportunities, while supporting the increased distribution to our shareholders announced March 6, 2023; our growing confidence in Wajax's near- and longer- term outlooks, driven by Wajax's expanded relationship with Hitachi, as well as solid demand for the full suite of products and services offered across our business; our outlook for 2023, including the view that solid fundamentals persist in many of the markets Wajax serves - particularly, mining, energy and construction, and that our strong start-of-year backlog is supportive of our confidence in the near-term future; our expectation that Wajax's heavy equipment business will grow in 2023, and our anticipation of further strong demand in Wajax's less cyclical industrial parts and ERS businesses; our expectation that that the challenges of 2023 will be similar to 2022 - ongoing supply chain volatility, higher interest rates, inflation, and a tight labour market; and our continued focus on investing in Wajax's people and their overall health and well-being, delivering exceptional customer value, organically growing the business, transacting on a robust acquisition pipeline, leveraging our enhanced relationship with Hitachi, prudently managing our balance sheet, deploying our new ERP system, and entrenching sustainability into our business. These statements are based on a number of assumptions which may prove to be incorrect, including, but not limited to, assumptions regarding: general business and economic conditions; the supply and demand for, and the level and volatility of prices for, oil, natural gas and other commodities; financial market conditions, including interest rates; the ability of Hitachi and Wajax to develop and execute successful sales, marketing and other plans related to the expanded direct distribution relationship which took effect on March 1, 2022; our ability to execute our One Wajax strategy, including our ability to execute on our organic growth priorities, complete and effectively integrate acquisitions, and successfully implement new information technology platforms, systems and software, such as our new ERP system; the continuing effects of the COVID-19 pandemic and actions taken by governments, public authorities, suppliers and customers in response to the novel coronavirus and its variants; the future financial performance of the Corporation; our costs; market competition; our ability to attract and retain skilled staff; our ability to procure quality products and inventory; and our ongoing relations with suppliers, employees and customers. The foregoing list of assumptions is not exhaustive. Factors that may cause actual results to vary materially include, but are not limited to: a continued or prolonged deterioration in general business and economic conditions, including as a result of new coronavirus variants or armed conflicts between nations; supply chain disruptions and shortages related to or arising from the impacts of COVID-19 or armed conflicts between nations; fluctuations in financial market conditions, including interest rates; the continuing impacts of the COVID-19 pandemic, including the duration and severity of travel, business and other restrictions imposed by governments and public authorities in response to COVID-19 and its variants; actions taken by our suppliers and customers in relation to the COVID-19 pandemic, including slowing, reducing or halting operations; the inability of Hitachi and Wajax to develop and execute successful sales, marketing and other plans related to the expanded direct distribution relationship which took effect on March 1, 2022; volatility in the supply and demand for, and the level of prices for, oil, natural gas and other commodities; a continued or prolonged decrease in the price of oil or natural gas; the level of demand for, and prices of, the products and services we offer; levels of customer confidence and spending; market acceptance of the products we offer; termination of distribution or original equipment manufacturer agreements; unanticipated operational difficulties (including failure of plant, equipment or processes to operate in accordance with specifications or expectations, cost escalation, our inability to reduce costs in response to slow-downs in market activity, unavailability of quality products or inventory, supply disruptions (including those caused by or related to the COVID-19 pandemic), job action and unanticipated events related to health, safety and environmental matters); our ability to attract and retain skilled staff and our ability to maintain our relationships with suppliers, employees and customers.

The foregoing list of factors is not exhaustive. Further information concerning the risks and uncertainties associated with these forward-looking statements and the Corporation's business may be found in our annual MD&A which has been filed on SEDAR. The forward-looking statements contained in this presentation are expressly qualified in their entirety by this cautionary statement. The Corporation does not undertake any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

Readers are cautioned that the risks described in our annual MD&A, are not the only risks that could impact the Corporation. Risks and uncertainties not currently known to the Corporation, or currently deemed to be immaterial, may have a material effect on the Corporation's business, financial condition or results of operations.

Non-GAAP and Additional GAAP Measures

This presentation contains certain non-GAAP and additional GAAP measures that do not have a standardized meaning prescribed by GAAP. Therefore, these financial measures may not be comparable to similar measures presented by other issuers. Investors are cautioned that these measures should not be construed as an alternative to net earnings or to cash flow from operating, investing, and financing activities determined in accordance with GAAP as indicators of the Corporation's performance.

Please see Wajax's Management's Discussion and Analysis for the three and twelve months ended December 31, 2022 under the heading "Non-GAAP and Additional GAAP Measures" for definitions of these measures and reconciliations to the most directly comparable GAAP measures.

Highlights - Fourth Quarter

Significant improvement in key financial metrics and TRIF

Percentage change from Q4 2021

Overall growth led by strength in West and East regions with meaningful Q4

improvement in the Central region

Note: Totals may not add due to rounding.