- Black Diamond Group (BDI) has unveiled a C$35 million capital spending plan for 2021, focused primarily on supporting North American growth
- Much of the budget will go towards the company’s Modular Space Solutions (MSS) segment, which will account for roughy $25 million
- 65 per cent of this amount will go towards operations in Canada, while the remaining 35 per cent will focus on the United States
- Of the $4.5 million to be invested in the Workforce Solutions (WFS) segment, $2.5 million will be allocated for Australian education, space rentals and workforce applications
- Black Diamond Group is currently up 2.53 per cent to $2.43 per share
Black Diamond Group (BDI) has unveiled a C$35 million capital spending plan for 2021, focused primarily on supporting North American growth.
In the normal course of its business, the Calgary-based specialty rentals and industrial services company regularly buys and sells modular buildings into and out of its rental fleet. The proceeds from these sales have typically been between $5 million and $10 million each year, and the company anticipates this trend to continue next year.
As such, Black Diamond’s net capital investment for 2021 is expected to be between $25 million and $30 million.
Most of this budget will go towards the continued growth of the company’s Modular Space Solutions (MSS) segment in North America, which will amount for roughly $25 million. Of this amount, 65 per cent will be allocated for operations in Canada, while the remaining 35 per cent will focus on the United States.
Of the $4.5 million to be invested in Black Diamond’s Workforce Solutions (WFS) segment, $2.5 million will be set aside for the education, space rentals and workforce divisions in Australia, while the remaining $2 million will be used for refurbishing large format camp units on a project-specific basis.
The company’s digital platform for essential crew travel, LodgeLink, will see roughly $1.5 million in capital investment, which will be primarily used for software development to support continued growth.
Notably, the budget does not include investments related to Black Diamond’s Goldboro LNG facility.
The company said that operating cash flows throughout 2021 should be sufficient to fund the proposed budget, meet other cash costs – including interest payments and lease expenses.
The cash flows will also help reduce the company’s total debt levels, which saw a spike following the acquisition of Vanguard Modular Building Systems for US$61.7 million (roughly C$78.47 million) on November 30, 2020.
Black Diamond Group is currently up 2.53 per cent to $2.43 per share at 10:54am EST.
