ANNUAL REPORT
2023
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Letter to Shareholders
2023 Financial Highlights
Strategy in Action
Management’s Discussion & Analysis
Consolidated Financial Statements
Corporate Information
Locations
4
12
15
52
91
144
145
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This Annual Report contains forward-looking statements and information (“forward-looking statements”) within the
meaning of applicable Canadian securities laws. The forward-looking statements contained in this report are based on the
expectations, estimates and projections of management of Bird as of as of March 5, 2024, unless otherwise stated. Please
refer to the Forward-Looking Information on page 90 for additional information.
Letter to
Shareholders
The Bird team delivered a strong
performance in 2023. We are pleased
with the considerable progress we
have made in the second year of our
strategic plan, thanks to our highly
experienced and dedicated teams.
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Across the country, we saw
increased collaboration and cross-
selling, continued organic and M&A
diversification, the awarding of
many projects in targeted sectors
with risk-reward profiles that are
accretive, and the expansion
of multi-year recurring revenue
streams. At year end, the Company’s
combined backlog grew to record
levels while we remained disciplined
in our project selection and focused
on advancing our strategic priorities.
This includes continuing to improve
our Adjusted EBITDA margins, supported by our
highly collaborative, risk balanced, diversified
projects in complex and high demand sectors.
A Culture of Operational and Psychological
Safety: Safety through Engagement
Continuously improving our exemplary safety
record remains a top priority and is embedded in
our culture of continuous learning. Consistently
achieving a healthy and safe work environment
is accomplished through collaboration with
employees, trade partners, clients, and suppliers.
Open dialogue is encouraged through multiple
touchpoints at all levels, including regular on-site
safety visits with senior leaders. Bird also introduced
an interactive, safety-focused mobile app in
2023 to further engage all levels of employees
and empower them with leadership insight,
safety knowledge, and industry best-practices to
further support our culture of safety. Through our
participation on the Canadian Construction Safety
Council, we also work alongside select industry
peers to elevate industry safety standards.
A Culture of Execution Excellence:
An Industry Built for the Future
The construction industry has experienced rapid
growth in a variety of sectors this past year.
Canada’s population growth and urbanization
are driving demand for renewed and expanded
transportation systems, telecommunications and
utilities networks, and education and healthcare
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facilities. The evolving energy landscape is also
generating significant investment in electrical
infrastructure to enhance Canada’s energy
grid to meet growing demands for power and
preparedness to achieve decarbonization goals.
Bird’s team of over 2,500 electricians and electrical
personnel are at the forefront of constructing
and maintaining both traditional and future
energy solutions, integrating renewable energy
sources, improving energy efficiency across all
infrastructure, and ensuring the reliability and
efficiency of Canada’s energy ecosystem. Bird
has been a key long-term partner for many clients
nationally who manage the energy systems that
power the country. The current strong commodities
markets are further aiding the positive growth
outlook in the construction industry. The longer-
term commodities outlook is supported by the
demand for critical minerals essential for the energy
transition, including for batteries and electric
vehicles. An emphasis on collaborative project
delivery and strategic investments in construction
technologies are supporting industry expansion,
and have led to optimized safety, productivity,
and collaboration.
Our ability to deliver critical projects across a range
of sectors has solidified the Company’s reputation
as a trusted partner, as highlighted through the
award of the Alliance Development Agreement to
work collaboratively with Metrolinx to deliver the
East Harbour Transit Hub. This project is one of the
first major projects in Canada to be procured using
the highly collaborative alliance model, well-aligned
with Bird’s position as a leading collaborative
contractor in Canada. We strongly believe that
collaborative methods are the best way to build
complex projects, and Bird’s expertise in various
collaborative delivery models have supported
improved project delivery and outcomes that are
beneficial for all parties.
A number of significant projects were awarded
throughout 2023 that reflect the success of
Bird’s diversified work program and innovative
construction solutions across Canada. There has
been steady growth in the Company’s nuclear
division, a substantial portfolio of major institutional
and infrastructure projects, and a decade-high
mining backlog from coast to coast to coast.
Among the notable projects awarded in 2023 are
contracts for large energy clients that include
additional maintenance and repair MSA contracts,
early works at a new LNG project in Western
Canada, the Kakabeka Falls Generating Station
Life Extension Project, and a new multi-year task
order for environmental remediation for Canadian
Nuclear Laboratories. Major transportation projects
include the Fleet Maintenance Unit Redevelopment
Project which aims to revitalize BC Ferries’ existing
maintenance facility and the previously referenced
East Harbour Transit Hub in Toronto, Ontario. The
team was awarded a number of significant post-
secondary facilities across major markets including
the Seneca Polytechnic Health Wellness Centre
Project in Ontario, the Vancouver Community
College Centre for Clean Energy and Automotive
Innovation, the Southern Alberta Institute of
Technology’s Campus Centre Redevelopment
Project, and the Victor Philip Dahdaleh Hall project
at St. Francis Xavier University in Nova Scotia. Bird
was also awarded two of Canada’s tallest modular
builds: 14- and 13-storey modular towers for BC
Housing’s Permanent Supportive Housing Initiative
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The strength of Bird’s Balance Sheet
enables the Company to capitalize on
acquisition opportunities.
that will be delivered in partnership with the Stack
Modular business. The suitability of the Bird/Stack
innovative, rapid build solutions for affordable
housing and other critical infrastructure needs
across Canada, supports our strategic growth in
this high demand sector.
A Culture of Collaboration:
Creating Opportunity
We are pleased with the continued accretion of
our Adjusted EBITDA margin, which is expected
to further improve through 2024, and the positive
revenue growth outlook based on a robust
backlog and pending backlog that remains highly
collaborative. This is aligned with our disciplined
pursuit of projects with appropriate risk profiles.
We are looking forward to a high demand year
in 2024 following the full year organic growth
year-over-year of over 17% in 2023.
The strength of Bird’s Balance Sheet enables the
Company to capitalize on acquisition opportunities
focused on the provision of specialized, self-
perform capabilities with sound growth potential
post-acquisition. On January 31, 2023, Bird acquired
Trinity Communication Services Ltd., a diversified
telecommunication and utility infrastructure
contractor. On January 18, 2024, Bird acquired the
assets of NorCan Electric Inc., (“NorCan”). NorCan
has operated through an Indigenous partnership
since 2018, the NorCan/Infinity Limited Partnership,
with Infinity Métis Corporation. This partnership
aligns with Bird’s commitment to developing and
maintaining authentic collaborative partnerships
with Indigenous businesses and communities.
These acquisitions are expected to drive further
growth in Bird’s self-perform telecommunication,
power distribution, high voltage, and electrical
and instrumentation capabilities. M&A remains a
core element of Bird’s strategy, and the Company
remains well-positioned to pursue opportunities
that may arise in 2024.
A Learning and Development Focus:
High-performing and Engaged Teams
In 2023 Bird continued to grow our team,
responding to business growth and the demand
for our combined suite of services. Attracting
and retaining top-tier talent fosters a culture of
excellence and ensures that Bird can maintain its
reputation for building long-term relationships
internally and externally, while delivering the
exceptional execution that clients have come to
expect. A core enabler to creating opportunity is
recognizing that success is a team effort and that
continuous improvement and evolution of internal
learning and development programs throughout
the year can elevate our people, our culture, and
our client experience. These efforts were recently
recognized with Bird being named in Forbes’
Canada’s Best Employers for 2024.
Shaping Tomorrow: Innovating Today
for a Sustainable Future
Sustainability considerations continue to shape
the construction industry, from the refinement of
resilient designs to the development of innovative
materials, technologies, and techniques that enable
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balanced and diversified combined backlog with
higher embedded margins provides strong visibility
into 2024 revenue growth and further margin
accretion. The Company continues to deliver an
industry-leading Return on Equity and to generate
growth in Cash Flow from Operations which we
believe are two key metrics that generate long-term
shareholder value.
Continuing to deliver our robust offerings with
exceptional, high-performing teams from coast to
coast to coast, Bird is positioned to embrace future
opportunities that align with our strategic priorities.
Underpinned by Bird’s strong and inclusive culture,
we are ready to create opportunity and bring life
to vision.
Thank you for your support,
Paul R. Raboud
Chairman
of the Board
Terrance L. McKibbon
President and Chief
Executive Officer
the construction of sustainable infrastructure. The
influence and impact of regulatory and disclosure
requirements are also increasing. Bird is committed
to assisting clients in navigating these changes and
achieving their sustainability goals.
Bird’s Environmental, Social, and Governance (ESG)
program remains aligned to business, client, and
industry demands. The four pillars of the Bird ESG
program (Build Green, Work Green, Live Green, and
Commitment to Governance) embed sustainability
within the business to optimize our positive social
and environmental impact by utilizing a strong
corporate governance framework that ensures
accountability and stewardship across all our
operations. Bird’s self-perform capabilities in the
industrial and infrastructure sectors continue to
contribute to the achievement of decarbonization
and electrification goals, while the Company’s
wealth of experience in sustainable construction
includes expertise in mass timber, deep energy
retrofits, and net-zero construction. Strong
relationships provide a foundation for authentic
collaboration, which drives innovation and the
realization of practical solutions that serve clients
and communities. Bird also continues to consider
the Company’s own impact, and as part of our
ESG journey, we have committed to setting GHG
emissions reduction and net-zero targets by late
2025 as part of the Science Based Target Initiative.
We look forward to sharing some of the highlights
from the last year in the forthcoming 2023
Sustainability Overview.
While 2023 was an exciting year for Bird, we expect
2024 to bring another year of growth, improved
profitability and further diversification. Bird’s risk-
2024
Financial
Calendar
May 14 - Sustainability Overview 2023
August 7 - Q2 2024 Financial Results
May 14 - AGM
November 5 - Q3 2024 Financial Results
May 14 - Q1 2024 Financial Results
March 11 - Full Year 2024 Financial Results
Our dedicated teams
across the country
drove this success by
delivering projects safely,
enhancing collaboration,
diversifying our portfolio
with impactful projects,
increasing self-perform
scopes, and expanding
recurring revenue streams.
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”
As we reflect on 2023, I am proud to acknowledge Bird’s
strong performance and significant progress under our
current strategic plan. Our dedicated teams across the
country drove this success by delivering projects safely,
enhancing collaboration, diversifying our portfolio with
impactful projects, increasing self-perform scopes, and
expanding recurring revenue streams. We strategically
grew our combined backlog to record levels with our
risk-balanced, disciplined approach to project selection,
bringing significant EBITDA margin improvement in 2023
and adding visibility to growth and continued EBITDA
accretion in 2024. Bird is committed to a balanced
capital approach, accretive M&A, and maintaining a
robust financial position through our focus on balancing
investment in profitable long-term growth with a healthy
dividend for shareholders. With our strong balance sheet,
we are well-equipped to support our strategic growth
initiatives. Rooted in our people-centric culture and
driven by respect, collaboration, and a solution-oriented
mindset, we continue to grow, attracting and developing
the best talent in the industry.
”
Teri McKibbon,
President and CEO
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TSX:BDT
2023 FINANCIAL HIGHLIGHTS
Profitable long-term growth with healthy distributions to shareholders
Generating
cashflows and
funding
growth with a
well-capitalized
balance sheet
Cash Flows
from Operations3
$144M in 2023
from $114M
in 2022
Negative
Net Debt4
-$7M at
December
31, 2023
Revenue
Revenue
Backlog and Pending
Backlog and Pending
Backlog1
Backlog1
2023
2022
$2.8B
$2.4B
2023
2022
$3.4B
$3.0B
$2.6B
$2.5B
0
1000
2000
3000
Backlog
Pending Backlog
+18% 2023 y/y growth
+7% 2022 y/y growth
Increased combined
backlog by over $1B y/y
Net Income
Net income
Adj. EBITDA1,2
Adj. EBITDA1,2
2023
2022
$72M
$50M
2023
2022
$139M
$101M
0
$1.33 2023 EPS
$0.93 2022 EPS
0
5.0% 2023 Adj.
EBITDA Margin1
4.3% 2022 Adj. EBITDA Margin
150
2023 Revenue
Industrial
Buildings
Infrastructure
39%
48%
13%
Over the past six years, Bird has strategically
diversified its revenue sources while shifting to
a risk-balanced mix of work. Throughout this
transition, Bird has enhanced its profitability and
Adjusted EBITDA margins.
Today, Bird is known for delivering complex and
sophisticated projects across the industrial,
infrastructure, and buildings markets. We continue
to grow across all markets as we have been able
to achieve sustainable profitability improvements.
Infrastructure, currently underweighted in size, will see
the highest growth and will be a focus for M&A.
While great progress has been made in advancing
Bird’s strategic priorities, there is still a significant
runway of expansion and diversification opportunities
that will continue to drive forward Bird’s growth
strategy and margin accretion over the coming years.
1 Throughout this document, certain terminology and financial measures are used that do not have standard meanings under IFRS and are considered specified
financial measures. These measures may not be comparable with similar measures presented by other companies. Refer to the Terminology and Non-GAAP & Other
Financial Measures section of Management’s Discussion and Analysis.
2 Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. Refer to the Terminology and Non-GAAP & Other
Financial Measures section of Management’s Discussion and Analysis.
3 Cash flows from operations - Refer to the consolidated statement of cash flows – “Cash flows from operations before changes in non-cash working capital”
4 “Adjusted Net Debt” is a non-GAAP financial measure defined as current and long-term loans and borrowings as disclosed in the
Company’s statement of financial position, less accessible cash, as disclosed in the Company’s notes to the financial statements. “Adjusted Net Debt” is a non-GAAP
financial measure defined as current and long-term loans and borrowings as disclosed in the Company’s statement of financial position, less accessible cash, as
disclosed in the Company’s notes to the financial statements. Management uses this as a measure of financial leverage and is part of its assessment of the Company’s
capital structure. At December 31, 2023, Adjusted Net Debt of $(6,958) is calculated as: Loans and borrowings (non-current) $64,621 plus Current portion of loans and
borrowings $8,305 minus Accessible cash $79,884.
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5-Year Revenue and Adjusted EBITDA
Leading
Collaborative
Contractor
>75%
Collaborative
Contracts(5)
Bird’s leading reputation and
experience in collaborative
contracting continues to
support strategic priorities.
Through collaborative
contracting methods, Bird
increases innovation and
efficiencies bringing schedule
and cost value to the owner.
Collaborative contracting is
well suited for the scale and
complexity of many of
Bird’s projects.
•
Incentivize all partners to
achieve project goals and
provide full transparency
regarding project costs
• Project costs not at risk
• Gain share, pain share
driving high performance
and efficiency
• Upfront work reduces
overall constructability risk
Fueling organic and M&A growth while increasing
profitably through strategic priorities
Growth
Profitability Improvements
• Growing reputation for excellence on
complex projects
• Geographic diversification of services
in key markets:
Disciplined project selection
– strategic alignment between
capabilities, project type and
delivery model
- Primarily low to medium risk
- Industrial in Ontario and BC
mix of projects
- Growing mechanical and
electrical nationally
- Full-service civil infrastructure and
utilities nationally
- Expanding nuclear portfolio
- Opportunities in energy transition-
related projects
- Data-related facilities and
infrastructure
• M&A growth focused on expanding in
strategic sectors with higher-margin
potential:
- Civil infrastructure (specialized and
light civil), process mechanical,
electrical, MRO services, utilities
(telecom, advanced wireless,
underground), nuclear, and renewables
- >75% collaborative projects
Stronger margins in core
businesses
M&A in sectors with accretive
margin profiles
Growing portion of projects
in higher margin sectors
(more sophisticated and
complex work)
Increasing self-perform work
with new and existing clients
Cross-selling additional Bird
scopes and services
Growing recurring revenue
at accretive margins
Gaining leverage on cost
structure
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5 Collaborative contracts include: MSA, IPD, Alliance, PDB and certain CM which are defined in the Nature of Business section of the MD&A
+84%
Total
Shareholder
Return
December 12,
2023: Bird Increases
Monthly Dividend
30.2% On Outlook
For 2024 Revenue
And Earnings
Growth And Margin
Expansion
2023 Share Price and Volume
16
14
12
10
8
6
4
2
0
Jan-23
Feb-23 Mar-23 Apr-23 May-23
Jun-23
Jul-23
Aug-23
Sep-23 Oct-23 Nov-23 Dec-23
Volume
Price
Linear (Volume)
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
Balanced capital allocation strategy with well-covered
dividend and flexibility to pursue growth
While delivering sustained margin accretion and
revenue growth, Bird remains focused on maintaining
a strong balance sheet. The Company’s solid balance
sheet and low net debt position enable the Company
to continue to deliver on its strategic priorities,
including additional opportunistic tuck-in acquisitions.
The Company’s capital allocation strategy aims to drive
business growth, robust profitability, and enhanced
long-term shareholder value through a blend of M&A,
smart capital investments to support productivity and
growth, and returning capital to shareholders
through dividends.
Sustained, Strong Financial Position
Positive return and capital efficiency metrics:
1.26
Current ratio1
27% 2023 ROE2
19% 2022 ROE
Positioned for
Future Performance
Expectations for continued
year over year revenue growth
and margin accretion.
Robust Backlog and Pending Backlog
Strong recurring revenue
Visibility to accretion of margins from Backlog and
Pending Backlog
Robustindustrydemandwithsignificantmediumand
long-term opportunities
1 “Current Ratio” is a supplementary financial measure representing the percentage derived by dividing total current assets by total current liabilities.
2 “Return on Equity” (ROE) is a is a non-GAAP financial ratio representing Adjusted Earnings as a percentage of opening total shareholders equity.
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2023 Strategy in Action:
Team, Perform,
Diversify
Building on 2023’s revenue growth and profitability
improvements, we are channeling our efforts as we enter into
the final phase of our current strategic plan. Bird is poised to
continue to capitalize on robust demand across market sectors,
bolstered by macro trends in critical areas that are more
aligned to longer-term development and investment cycles
such as infrastructure requirements driven by urbanization and
population growth, electrification, and the energy transition.
Bird is poised to continue to capitalize
on robust demand across market sectors,
bolstered by macro trends like urbanization,
population growth, electrification, and the
energy transition.
2025-2027
Teams are currently working on the next
strategic plan that will cover 2025-2027.
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2023 Strategy in Action:
Team, Perform, Diversify
TEAM
Strategy:
Develop a highly engaged,
high-performance team
with industry leading people
programs and a world-class
safety program united under
the One Bird approach.
World-class
safety program
Highly engaged, high-
performance team
with industry leading
people programs that
promote a culture of
hungry, humble,
and smart
Strategic internal and
external partnerships
and collaborative
contracting methods
Safety Program
Bird is recognized for best-in-class Health, Safety,
and Environment Management (HSE) systems and
industry-leading safety performance. Our health
and safety culture is rooted in our commitment
to work in a spirit of collaboration with all
employees, trade partners, clients, and suppliers,
to foster a healthy and safe work environment
that ensures everyone goes home safe every day.
This commitment includes more than just physical
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safety. We strive to create an empathetic culture
that goes beyond providing physical health benefits
by considering the mental health and psychological
safety of all employees. We uphold our high
standards through an engaged workforce and
vigilant processes that create a culture of complete
accountability and personal responsibility.
Executive Site Safety Tours
A fundamental component of Bird’s culture of
safety excellence and continuous improvement are
Bird’s executive safety tours. These tours exemplify
Bird’s belief that safety is everyone’s responsibility.
Our executive and operations leaders consistently
engage in meaningful dialogue to enhance safety
on-site, reinforcing Bird’s dedication to a safe,
healthy work environment. The site safety tours are
not just routine checks; they are a cornerstone of
our ‘safety-first’ ethos. They foster engagement,
ensure accountability, and embody the ‘One Bird’
spirit, even in the most remote locations. With
every visit, we see our teams’ commitment grow
as they embrace the initiative, feel valued, and
contribute to positive changes. This high level of
on-site engagement showcases the essence of
being ‘Hungry, Humble, Smart’—a testament to our
collective effort to shape a safer, more connected
Bird community.
Executive Site Safety Tour
CEO Safety Council
Bird is a proud member of the Canadian
Construction Safety Council (CCSC). The Council
was formed in early 2023 with twelve founding
members: Aecon, Bird, Dragados, EBC, Ellis Don,
Graham, Kiewit, Ledcor, Pennecon, PCL, Pomerleau
and AtkinsRéalis, formerly SNC-Lavalin. This group
of companies represents over 145,000 workers, 185
million person-hours and over $25 billion in revenue
annually. The collective mission of the Council is “to
be a force for positive change in the construction
industry in Canada, by leveraging the collective
safety capacity of the membership to foster
improved performance.” The key priority and focus
area defined by the CCSC is the alignment of larger
general contractors around HSE high
risk standards.
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SAFETY
AWARDS
Maintaining and
exceeding our
exemplary safety
record is more than
a priority; it’s a
value ingrained in
every project and
every team.
We are proud to
share a few of
the awards that
underscore our
collective efforts in
championing safety.
–
–
–
–
Q2 2023 Safety Cup Presentation
The Covenant Health Project Team, a collaboration between Bird and
our trade partners, was recognized internally in the Q2 2023 Safety
Cup. This award celebrated the project’s holistic commitment to
advancing our safety culture, and the accolade is a testament to their
proactive approach to health, safety, and environmental practices.
Safety Recognition for Nova Turnaround
Our MRO team was recognized for their exceptional contribution to
the NOVA project’s turnaround. Tasked with upgrading the power
supply, the team executed the project flawlessly within a tight two-
day window. Demonstrating their strong commitment to safety, they
completed approximately 25,000 hours of work without a single
incident, setting a benchmark for excellence in operational safety.
ACSA Awards: Celebrating Individual Excellence
At the 2023 Alberta Construction Safety Association Awards, Marcy
Holinaty and Patty Brown of our MRO team were recognized for
their outstanding contributions, robust community engagement,
and collaborative approach on-site. Marcy, HSE Advisor, clinched
the National Construction Safety Officer (NCSO™) of the Year
Award. Patty, our HSE Administrator, received the Health and Safety
Administrator (HSA) of the Year Award.
NBCSA Safety Professional of the Year
Cody Arnold, a Bird Safety Coordinator, was distinguished as the
2023 New Brunswick Construction Safety Association (NBCSA)
Safety Professional of the Year. A pillar of our team since 2006,
Cody’s commitment extends beyond Bird, encompassing significant
contributions to industry boards and numerous volunteer
safety initiatives.
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NBCSA Safety
Professional of the Year
SAFETY WEEK
Bird’s inaugural companywide Safety Week was held at the beginning
of May 2023. A strong safety culture focuses on the ‘heart and the
head’, and in our first safety week, the focus was on mental health
and how we all help to shape safe workspaces. The strong sense of
community at the local safety events spoke volumes about the spirit,
creativity, and connectivity that makes Bird a better place to work.
>260
Inspections and
Toolbox Talks
78
Team
Activities
38
BBQs
3
Guest
Speakers
People Programs and
Culture of Learning
the Bird Site Management Program, Field Leaders
Foundations, and The Power of Conversations.
Additionally, our Mentorship Program fosters
targeted skills enhancement, network expansion,
and a rich, holistic learning experience.
Learning and skills development is also an
important focus area with external partners,
including our Indigenous Engagement
approach. One of the four pillars of our National
Indigenous Engagement Policy is investing in
community programs that support Indigenous
cultural awareness, skills development, and
business capacity.
At Bird, we are committed to fostering a culture of
continuous improvement, innovation, and growth.
We understand that learning is a multifaceted
journey, encompassing the 3 E’s: Experience,
Exposure, and Education. Our learning ecosystem
is designed to elevate performance with an
emphasis on shared accountability and collective
success. We encourage each individual to
proactively engage in their personal development,
setting career goals and seeking the necessary
support to achieve them.
Our People & Culture team is dedicated to
delivering best-in-class learning and development
opportunities, utilizing platforms like Workday
which offers over 14,000 courses, and facilitating
peer-to-peer learning initiatives such as the
Expertise Exchange. Leadership development is
a cornerstone of our approach with programs like
Finance for Non-Financial Managers, Taking Flight,
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At Bird, we are committed to fostering our employees’ growth
through ongoing learning. This encompasses not only formal education
opportunities, but also new experiences and the opportunity to be
exposed to the perspectives and insights of others.
Learning
Highlights
Field Leaders Foundations:
This program is focused on
equipping and elevating
Bird’s field supervisors as
future leaders within the field
leadership stream. In the
inaugural year, approximately
80 participants were selected
by operational leaders to
participate in the four-week
pilot across all sectors
and districts.
Women of Steel™:
The Women of Steel™
pre-employment program
is delivered in partnership
with the Canadian Welding
Bureau and the 2Nations
Bird Partnership that is
currently working on BHP’s
Jansen Potash Mine Phase
1. The program provides
opportunities for self-
identifying Indigenous
women and non-binary
individuals to pursue careers
in the skilled trades. The
Saskatchewan Indian
Institute of Technologies
(SIIT), Saskatchewan
Apprenticeship and Trade
Certification Commission,
Native Women’s Association
of Canada National
Apprenticeship Program,
and Xtended Hydraulics
& Machine supported this
empowering experience.
Mentorship Program:
The Bird Mentorship Program
provides an opportunity
for mentors and mentees
to connect with each
other, exchange ideas, and
prioritize the development
of our people. It’s a focused
and effective approach to
development that reinforces
collaboration across our
organization, encourages the
professional and personal
development of our people,
and fosters a continuous
culture of learning at Bird.
>130
Mentorship
matches
>3,800
Hours spent
on mentoring
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Partnerships
Bird is deeply committed to nurturing a
culture of collaboration and excellence.
Our work and relationships are a testament to
the respect and integrity that define
our company.
The ‘One Bird’ philosophy champions
cohesion and collaboration, enabling us to
deliver comprehensive services and share
knowledge, experiences, and best practices
seamlessly across the country. Throughout
our operations, we value the unique
perspectives and strengths of our
diverse teams.
Our commitment to building strong
relationships also extends beyond our internal
framework, embracing partnerships with
industry players, Indigenous businesses,
industry bodies, national and local
organizations, and the communities across
the country where we live and work.
Releasing on
May 14th, read our
2023 Sustainability
Overview for more
information.
In January 2024, Bird announced
that its 50/50 joint venture with
AtkinsRéalis, under the Rail Connect
Partners joint venture, has entered into
an Alliance Development Agreement to
work collaboratively with Metrolinx to
deliver the East Harbour Transit Hub.
The 2Nations Bird Construction
Partnership was formed between
Beardy’s and Okemasis Cree Nation,
Fishing Lake First Nation, and Bird
Construction to participate in BHP’s
Jansen Potash project. The partnership
provides a full scope of construction and
maintenance services. It procures goods
and services from local Indigenous
businesses and aims to maximize
employment opportunities for local
Indigenous employees. The partnership
was awarded three significant contracts
in 2023, valued at over $200 million.
Since 2022, Bird has been a strategic
partner with Chandos Construction
Inc. to host the Building Good
initiative. Building Good is a thought-
leadership initiative that aims to catalyze
owners and industry partners to build
better. Through this partnership, the
partners aim to educate, advocate, and
inspire positive change in our industry.
Scan for
podcast link
In 2023, Bird became corporate
partners with The Whiteboard
Collective as a part of their Community
Hub initiative that aims to facilitate
scalable employment outcomes across
Canada for marginalized groups.
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Community Partnerships:
The Bird Community Giving Framework is Bird’s
national community investment approach that aims
to make a positive contribution to the communities
where we live and work. The goal of the framework
is to use our financial resources and empower our
people to help enrich the lives of those in need
within our communities.
Throughout the year, team members engage in
fundraising and donation efforts, educational
opportunities, and boots-on-the-ground
volunteering centred around these five pillars
of focus:
• Indigenous Relations
• Education & Innovation
• Environment
• Health & Wellness
• Diversity, Equity, & Inclusion
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Diversity. Equity.
Inclusion.
Bird values the importance of creating inclusive,
respectful, and equitable working environments
and believes these are essential to our success. Our
inclusive workplace enables our combined expertise,
humility, and creativity to unlock our greater potential
and we are committed to creating a culture where
everyone feels welcome to fully participate and reach
their potential regardless of their background, ability,
or perspective. We continue to listen, learn, and take
action in our commitment to building progress in our
organization, and the industry as a whole. We reinforce
this commitment by assuring our policies and practices
provide fair and equitable opportunities for success.
Check out more on our website here
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Our Purpose is our reason for being as
an organization. It motivates and inspires
employees, clients, and business partners.
Our Values describe who we are as
One Bird when we operate at our best.
They guide us to make progress on our
purpose, while staying true to who we are
as an organization. Our Employee Value
Proposition describes why our employees
choose to build their
careers with Bird and lets
the world know what is
unique about us. These
statements show that
we are united on what
really matters and what
drives us to unlock our
greater potential.
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2023 Strategy in Action:
Team, Perform, Diversify
PERFORM
Strategy:
Operate under the key driver
of accountability, with our
success rooted in exceptional
project delivery and client
services, supported by a
strongfinancialframework,
robust risk management,
and a continued focus
on steady, consistent,
responsible growth.
Culture of
operational excellence
Provide innovative
client solutions
Common and scalable
technology platform
that builds efficiency
Robust financial and
risk management
Generate consistent
profitability with a
balanced backlog
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Financial Performance
As a leader in Canadian construction, we are
committed to delivering our best work.
Our combined suite of services, an emphasis on
long-term relationship-building, and an established
reputation for exceptional execution provide the
necessary support to help our clients realize their vision.
18%
2023 Revenue Growth y/y
$2,799M in 2023
37%
2023 Adj. EBITDA growth y/y
$139M in 2023
In 2023, our team of over 5,000 employees delivered
exceptional operational performance and collaborative
execution across all project sizes and delivery models.
Diverse Project Mix
Over the past few years, Bird has strategically diversified
revenue sources by geography and sector, while shifting
to a risk-balanced mix of work through disciplined
project selection and establishing Bird as a leading
collaborative contractor in Canada. Throughout this
transition, Bird has grown significantly while enhancing
profitability and adjusted EBITDA margins. Today, Bird
is known for delivering complex and sophisticated
projects across the industrial, infrastructure, and
building markets.
Industrial
Buildings
Infrastructure
39%
48%
13%
(34% in 2022)
(51% in 2022)
(15% in 2022)
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Improving Margins
During this evolution, Bird has experienced robust financial performance, with growing revenues and
improving profitability. A key strategic focus has been Adjusted EBITDA margin accretion, which Bird has
steadily improved within the past five years from 2.4% in 2019 to 5.0% in 2023.
Margin improvements
have been supported by:
Risk-balanced
mix of projects
Increasing
self-perform
work
Gaining leverage
on cost structure
Cross-selling
additional Bird
scopes and services
on one project
Collaborative
projects
Growing portion of
projects in higher
margin sectors (more
sophisticated and
complex work)
DIVIDEND INCREASE
In December 2023, Bird announced a significant dividend in crease of 30.2%, raising the monthly dividend
to $0.0467 per share effective from the March 29, 2024 dividend. Reflecting Bird’s robust financial outook
and record Backlog, this decision came after the Board’s approval of Bird’s 2024 annual business plan, which
anticipates higher earnings and Adjusted EBITDA. President and CEO Teri McKibbon cited the Company’s
outlook for improvements in earnings and cash flow, and the Company’s balanced capital allocation strategy,
emphasizing long-term profitable growth with sustainable distributions to shareholders, while allowing the
Company to retain in excess of two-thirds of Net Income to support continued organic growth and strategic
M&A, and smart capital investments to support further productivity and growth.
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Industry Positioned
for the Future:
2022 Federal Budget estimated the investment in
net-zero transition requires $125 billion to $140 billion
annually through 2050. While estimates of Canada’s
“infrastructure deficit” range from $110-$270 billion.1
Canada needs to roughly double its electricity
supply. Electrification requires investment in energy
generation projects, including expanding clean
energy and improving power distribution and
transmission systems.
Additional investments are required to improve
energy efficiency – in all industries as well as in
residential and commercial buildings, which are
Canada’s third-largest source of greenhouse gases.
Nuclear opportunities are significant, notably the
recently proposed Bruce Nuclear Expansion, the
Pickering Refurbishment, and SMR Infrastructure
initiatives.
Public transportation opportunities include Ontario’s
planned $70 billion for transit investments over
the next ten years, Canada’s $15 billion for public
transit over the next eight years, as well as significant
spending across the balance of provinces.
Government programs supporting investments
in transportation, energy, water and wastewater,
telecommunications, and public facilities include
the Investing in Canada Plan, Canada Infrastructure
Bank, Canada Growth Fund, and other federal and
provincial budget commitments.
The Investing in Canada Plan launched in 2016,
laid out federal government commitments to invest
more than $180 billion over 12 years (2016-2028) in
public transit projects, green infrastructure, social
infrastructure, trade and transportation routes, and
Canada’s rural and northern communities ~$150
billion invested to date.2
The construction
industry is currently
experiencing
robust demand,
with many
sectors looking
towards long-term
investment and
development.
This demand, which reflects
both public and private end
markets, is driven by the need
to address aging infrastructure,
the push for energy transition
and decarbonization, and the
effects of urbanization and
population growth, positioning
the industry for a promising
future. Bird’s strategic presence
across key markets, particularly
in infrastructure, industrial, and
buildings, positions it well to
capitalize on significant long-
term growth opportunities.
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2 Source
1 Source and Source
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Building a Culture
of Operational Excellence
Bird is dedicated to operational excellence and
continuous improvement across every level of
our organization. Through tools such as our
collaboration playbook, Operational Excellence
initiative, operations manual, robust learning
programs, and comprehensive safety and quality
management programs, we provide teams with
the resources, best practices, and support to
achieve the best possible outcomes. We
recognize and celebrate individual and team
achievements through our Excellence Awards in
areas such as safety and leadership. Our strong
collaborative culture fosters an environment
where everyone is empowered and invested in
driving the highest levels of safety, quality,
and performance.
Quality Management:
Aligned Cultures and Shared
Best Practices
Quality execution is part of the Bird culture. Bird
teams establish effective, efficient, and job-specific
quality control programs prior to construction,
which are rigorously upheld throughout the
project’s construction lifecycle.
Training and Awareness
• Understanding roles and responsibilities
• Ensuring Bird has the right Subject Matter
Experts on site
Culture and Commitment
• Understanding the expectations, providing
the right tools and support
• Leadership sets and commits to the culture
and goals
• Open and transparent communications
with the client and subcontractors
Continuous Improvement
• Establishing effective quality objectives
and risks
• Ensuring metrics are measurable
• Create Lessons Learned -
use of experience
Bird’s quality management program ensures
operational excellence through a comprehensive
approach. This includes coordinated quality
inspections with regulators, customers,
stakeholders, and internal teams, alongside
meticulous work planning facilitated by project
management plans and precise scheduling tools.
Stringent work controls are established through
permits and work plans, incorporating safety
analyses, instructions, and technical specifications.
Our commitment to quality is reinforced by
continuous surveillance, timely resolution of issues,
and the use of quality dashboards to track key
performance indicators and ensure compliance.
This holistic approach underscores our dedication
to upholding the highest standards of quality in
every project.
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We achieve our Quality
Management through a blend
of pragmatic and inventive
planning techniques, a
commitment to enhancing
employee competencies, and a
relentless pursuit of continuous
improvement strategies.
Our Quality Management System follows ISO 9001:2015 requirements. With 110
approved weld procedures and 100 multi-discipline QAQC procedures, Stuart
Olson is the complete choice for dedicated and proactive quality work.
Stuart Olson is certified to operate in accordance with the following codes and
reference standards: ITSM, TSASK, ASME, ABSA, TSBC, CWB (W47.1/W59).
Bird’s Buildings Operational
Excellence initiative strives to
create consistent best practices,
expectations, and performance
measures to enable our project
delivery teams to drive enhanced
project success.
Themes range from planning,
change management, and
scheduling to quality control
and assurance, deficiencies, best
practices for various scopes of work.
Materials include videos, worksheets
and templates, real-world
applications, internal Bird examples,
and lessons learned.
Recognition of Excellence:
Bird Excellence Awards
25 YEAR CLUB
Bird has a proud tradition of people who
have enjoyed long and rewarding careers
with us. In 1956, Hubert John Bird (the
company founder) established the 25 Year
Club to recognize the contributions of the
Company’s dedicated employees. The club
now has 255 members. This is a testament to
our desire and ability to attract and retain the
best people in the industry as much as it is a
reflection on the way we do business. In 2023,
nine members were inducted into the club.
2
YEARS
OF SERVICE
The Bird Excellence Awards annually celebrate the exceptional achievements and contributions of individuals
and teams pivotal to our Company’s success. In 2023, these accolades included six categories: safety,
collaboration, resilience, community, leadership, and performance, spotlighting the outstanding work
completed in the year.
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Collaborative Approach
Bird’s Collaborative Approach in Practice:
“Collaboration is the
bedrock of operational
excellence. When we
move together with
a shared vision and
mutual trust, every
challenge becomes
an opportunity, and
high performance
becomes not just
an aspiration, but
a standard we
consistently achieve.”
Gilles Royer
ChiefOperatingOfficer
Collaboration Playbook
A tool to support a culture
where collaborative behaviours
are ingrained in team actions
and interactions.
• Bird collaborates internally across districts,
divisions, and areas of expertise (Centres
of Excellence).
• Externally, Bird partners and collaborates
effectively with designers, consultants,
trades, and competitors.
• Bird is a leader in collaborative contracting,
with extensive experience successfully
executing IPD, CM, and PDB contracts.
Key Success Factors:
• Long-term Relationships: Mutual respect
and open communication. Repeat
successful project delivery.
• Transparency: Collaboration. Respectful
truth over artificial harmony.
• Common Goals and Values: Win/win
mentality, coming together as one team to
solve for the project.
• Leveraging Strengths: Working together
to bring the very best to clients and
communities.
• Continuous Improvement: Shared focus on
safety, quality, cost, schedule, and vision.
Post Project
Execution
(Post-construction)
Prepositioning
(Business
Development)
Mindset and
Behaviours
Opportunity
Response
(Estimate/
Proposal)
Contract Execution
(Construction)
Pre-Project
Execution
(Pre-construction)
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Collaboration Recognition
Bird’s Industrial East team received the Collaborative
Trendsetter Award at the Global Energy Show in 2023 for
their collaborative efforts on a recent Hydro One Project.
The award designed to recognize those who advance the
use of collaboration techniques to achieve outstanding
project results was awarded to Bird based on our strong
collaborative team culture which achieved on-schedule,
under-budget performance while maintaining excellent
safety and quality results. The project team is now working
on Phase 2 at the Bruce A site following the successful
project at the Phase 1 Bruce B site.
Collaborative
Contract Highlight:
East Harbour
In January 2024, Bird announced that
its 50/50 joint venture with AtkinsRéalis,
under the Rail Connect Partners joint
venture, has entered into an Alliance
Development Agreement to work
collaboratively with Metrolinx to deliver
the East Harbour Transit Hub.
The East Harbour Transit Hub, part of Toronto’s
SmartTrack Stations Program, is one of the first
major projects in Canada to be procured using an
alliance model. The alliance model has been used
internationally to plan and deliver large, complex
infrastructure programs, driving innovation and
collaboration between parties. The alliance model
is better equipped to manage risk with greater
transparency and cooperative decision-making.
The Alliance Development Agreement marks
a collaborative phase where the focus is on
optimizing the design solution, developing
detailed resource, cost, and schedule estimates,
preparing a Project Proposal, finalizing the Project
Alliance Agreement, and performing Early Works.
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Innovative Client Solutions
THE
CENTRE
Innovative
Client Solutions
ITS - ONE PASS
TRENCHING
STACK
MODULAR
MASS
TIMBER
SIGMA
POWER
SPECIAL
PROJECTS
FABRICATION
The Centre for Building Performance (The Centre)
The Centre for Building Performance is an in-house initiative built on an
in-depth understanding of building systems and controls. The Centre deploys
technology that supports the lifecycle of a building asset by integrating all
building systems data to provide visibility into a building’s performance,
ensuring it performs as designed. The Centre guides and executes innovative
solutions that increase efficiency, reduce energy consumption, reduce
operational costs, mitigate risk, and ultimately create an integrated, high-
performing, sustainable building asset that can be monitored in real-time.
The optimization of building system performance is only one aspect of the
Centre’s work, as the platform is able to combine inputs from any connectible
system, thereby offering a range of monitoring, analysis, and insights.
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ITS – One Pass Trenching
ITS is a world leader that specializes in one-pass trenching technology to
install underground utilities safely, efficiently, and economically. Our one-pass
trenching is a key self-perform service provided to the renewables and utility
sectors.
• Faster and more efficient compared to traditional
trenching methods
• Open installs pipelines or conduit and closes trenches
in a single pass
• Fleet of Fockersperger Plows and Winch Tractors (for plow)
Stack Modular
Stack Modular provides an integrated solution bridging the gap between site
and modular construction and can deliver structural steel modular buildings
up to 40-storeys for multi-family, hospitality, senior (long-term care) and
student housing, and resource clients.
As an off-site manufacturer, Stack Modular builds innovatively, with less
footprint and smarter resource usage through pre-planning and waste
reduction methods.
• Rapid delivery across Canada and the USA
• Opportunities in a market poised for growth
• Schedule and cost certainty and predictability
• Reduced waste and high energy-efficiency product
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New Projects Highlight:
Modular Towers
In 2023, Bird was awarded two of Canada’s tallest modular tower
contracts. The 14- and 13-storey towers are part of BC Housing’s
Permanent Supportive Housing Initiative between BC Housing,
the City of Vancouver, and the Canada Mortgage and Housing
Corporation. The design of the projects was supported by Bird’s
pre-construction design services, with the final design delivered by
Stantec and Bird’s Stack Modular business.
Bird was awarded two
of Canada’s tallest
modular tower contracts
Our Bird Stack team has
been actively demonstrating
the benefits to building more
efficiently and fast-tracking
delivery of important
infrastructure to the market
with our forward-leaning accelerated construction solution. The
volumetric steel modular solution offers quality units on a rapid,
repeatable scale. At the same time, it allows for customization to
meet the community’s needs and creates a look and feel comparable
to current purpose-built apartments. With off-site design and
construction of the units, the modular approach substantially reduces
construction time, facilitating faster occupancy than traditional builds
and reducing the impact on the local community during construction,
while ensuring strict quality control, rigorous safety standards, and
significant energy performance standards. These benefits position
modular construction as an efficient solution to Canada’s housing
crisis and long-term care capacity challenges, as well as for the
delivery of other vital infrastructure with repeatable requirements.
Special Projects
Bird’s Special Projects team excels at projects that require a flexible and
responsive approach. The national Special Projects team targets smaller,
specialized projects that are typically shorter in duration and require a
distinctive approach. The Special Projects team is focused on repeat business
with existing and new national clients, and our collective construction
expertise supports our clients’ goals by leveraging new technologies,
sustainable practices and materials, and collaborative contracting models.
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Fabrication
Bird’s Fabrication team specializes in off-site fabrications of mechanical
process pipe, structural steel, and electrical installations and integration.
Bird’s fabrication facility includes 10 acres of module assembly yard, pipe
spooling, structural steel metal shop, and a Canadian Standards Association
(CSA) approved electrical panel shop. The team provides electrical assembly
services that support the complete lifecycle of electrical systems including
design support, procurement, integration, installation, and commissioning.
Bird’s facility is a total solution provider for industrial piping needs and
fabricates structural steel and other miscellaneous steel. We provide value
to our clients through early contractor involvement services and complete
self-perform capabilities, which reduce risk and provide certainty
throughout execution.
SIGMA Power
Bird’s Sigma Power Services, an integrated part of our MRO team, provides
a full range of technical services on equipment ranging from 480V to 500KV
to clients in the utility, industrial, and commercial markets. We design our
customized asset lifecycle program to meet and surpass each client’s unique,
long-term needs. Our experienced and skilled technologists specialize in
medium voltage and high voltage electrical maintenance, commissioning,
protection and controls, Supervisory Control and Data Automation (SCADA)
and project supports.
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Mass Timber
Mass timber is a renewable and sustainable low-carbon building solution.
Through sustainable forestry, wood-based materials capture carbon and
offset total CO2e emissions over the lifespan of the asset. Bird is a North
American leader in mass timber construction with the in-house expertise to
develop cross-laminated timber, nailed laminated timber, wood-frame, and
hybrid projects from concept to substantial completion. From high-rise wood
frame housing developments to large-scale institutional buildings, the Bird
team brings an in-depth understanding of the benefits and limitations of
different mass timber and engineered wood products and delivers efficient
design strategies to maximize structural efficiencies. Bird’s strong North
American network of material supply channels effectively services mass
timber projects from coast to coast. Global relationships with designers,
consultants, trades, and subject matter experts ensure that projects benefit
from cutting-edge technologies, forward-thinking strategies, and value-
maximizing processes. This results in buildings that improve communities,
user experience, and the environment.
The six-storey wood frame
building will include a
mass timber structured
club room with aluminum
curtain walls.
Student housing project
at Okanagan College in
Kelowna
The project will provide 182 suites and a total of
216 beds for the campus, supporting affordable
housing options for incoming students. The six-
storey wood frame building will include a mass
timber structured club room with aluminum curtain
walls. The interior columns of this mass timber
section are oversized to provide Indigenous artists
a canvas for their artwork.
Technology
& Data
One Team: Aligned, efficient,
informed & integrated
The industry is undergoing a profound
transformation driven by the integration of digital
technologies. In the quickly evolving landscape
of construction, innovation is key to staying
ahead. The core of Bird’s strategy centres on
the collection of real-time data into an enabling
framework that serves the multitude of integrated
applications in use (and projected to soon be in
use) across the organization.
Together, these technologies and applications
will improve jobsite processes and productivity,
reduce risk, increase safety, and optimize
performance.
Among the connected construction technologies
currently in use or in development across the
business are: Building Information Modeling
and Virtual Design Construction, digital twins,
digital forms, cameras, robots, drones, lasers,
3D printing, artificial intelligence and machine
learning, virtual reality, augmented reality, mixed
reality, and the IoT. Master Data Management is
key enabler of these technologies.
In December 2023, Bird’s digital
construction team received the
Digitization Strategy award at the
Building Transformations’ Innovation
Spotlight Awards. This recognition
from North America’s largest building
technology and innovation community
is a milestone that signals Bird’s rapid
digitization progress and underscores
our leadership in innovative
technologies.
Data Centres
The development of the digitization
of business and the development of
technologies such as IoT, machine learning,
and artificial intelligence generate
opportunities for Bird to leverage technology
internally. This significant growth in demand
for data storage and analysis also translates
directly into the demand for data centers.
Bird offers full turn-key data centre solutions
and can perform up to 90% of a data centre
scope in-house, providing clients with a fully
synchronized team dedicated to delivering
projects on schedule and on budget.
• Power generation
• Thermal energy transfer systems
• High and medium voltage powerlines
• Telecommunication lines
• Substations
• Earth works
• Underground utilities
• Concrete formwork
• Data security
• Mechanical and electrical
• Data and security services
• Technical commissioning
• White space fit-up
• Operations and maintenance
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2023 Strategy in Action:
Team, Perform, Diversify
DIVERSIFY
Strategy:
Leverage and expand our
diverse capabilities and
services across the country
supported by collaboration,
internal partnerships, and
building expertise to grow
service offerings and expand
self perform capabilities,
while maintaining a
well-balanced portfolio of
low- to medium-risk projects,
and continuing to drive an
improvingmarginprofile.
Diverse balance of
service offerings,
market reach and
geography with new
and current clients
Leverage our
integrated services
nationally
Increased self-perform
capabilities
Promote positive
relationships with
Indigenous partners
and communities
Execute our balanced
sustainability strategy
and continue strong
social stewardship
and good governance
framework
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Bird’s operations span across Canada, providing
comprehensive services and self-perform
scopes across the industrial, infrastructure,
and buildings markets.
We continue to drive diversification opportunities
that arise organically as we leverage our competitive
strengths, and through M&As where we see a strategic
fit that will allow us to accelerate our growth and
become larger, stronger, and more competitive across
the construction industry.
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Competitive Advantages
Our Market Sectors
Power*
Chemicals & Fuels,
Oil & Gas
Manufacturing
Agricultural
Chemicals**
Mining & Mineral
Processing
Utilities
Water &
Environment
Transportation
Education
Mature Living
Healthcare
Public Spaces
Public Safety
Mission Critical***
Military &
Defense
Multi-Residential
Commercial
* Power (Generation, Transmission, Distribution & Storage)
** Agricultural Chemicals & Agricultural Industrial
*** Data & Intelligence
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Self-perform Scopes and Services
Bird is a leader in fully integrated
service offerings for the complete
lifecycle of a project.
Our ability to self-perform critical path trade scopes
means Bird utilizes its own employees and resources to
execute services and scopes, rather than subcontracting
to third parties. This helps drive operational excellence
and improved insight into scheduling and budgeting.
By leveraging this approach, Bird can cross-sell its
comprehensive range of self-perform capabilities and
innovative services throughout the full project lifecycle
and across all market sectors.
By executing a higher percentage of self-perform
scopes and services we can exceed client expectations
throughout the project lifecycle by way of risk reduction,
cost savings, a shortened procurement cycle and more.
• Early contractor involvement
•
•
•
Civil, earthworks, underground
and concrete
Structural steel
Mechanical equipment installation:
tanks, vessels, pumps, conveyors,
and other systems
• Process piping
• Technical and powerline
•
•
Insulation, cladding and HVAC
Complete electrical, controls and
instrumentation
• Communications and security systems
• Full maintenance and turnaround services
• Pre-commissioning and commissioning
• Fabrication and modularization
Self-performing:
BIRD HEAVY CIVIL
Bird’s Heavy Civil team successfully
completedaDredgingandBackfillProjectin
late 2023. This project required the existing
saturated pyrrhotite tailings at the toe of the
dam’s downstream face to be excavated,
dredged,andreplacedwithrockfill.Ourteam
mechanically dredged a total of 43,120 m3,
hydraulically dredged a total of 71,802 m3 of
pyrrhotitetailings,andplacedbackfilltotaling
to 140,794 m3.
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Projects Announcement Timeline
2023 Projects
Over
+$3.6B
in Securements
in 2023
Agrifood Processing
Facility in Ontario
Concrete
foundations and
site services MSA
for BHP’s Jansen
Potash Project
Energy and mining
Maintenance,
Repair and
Operations MSA’s
Canada’s tallest
modular tower
Mining civil works at
one of Canada’s largest
iron ore mines
BC Ferries Maintenance
Facility Redevelopment
FEBRUARY
MARCH
APRIL
MAY/JUNE
Energy, mining,
Healthcare and post
secondary awards
across Canada
Additional
awards at
ArcelorMittal’s
Mont Wright and
BHP’s Jansen
Potash Project
Two state-of-the-
art post-secondary
projects in BC
Growing industrial
recurring revenue
MSA’s in Ontario
and Alberta
Early site works
awarded at LNG
export facility in
Western Canada
JULY
AUGUST
SEPTEMBER
OCTOBER
Institutional and
nuclear projects in
Ontario: Seneca
Health and Wellness
Centre and Port
Hope Environmental
Remediation MSA
Energy,
hydroelectric,
manufacturing,
and multi-storey
modular awards
Alliance
Development
Agreement for
East Harbour
Transit Hub in
Toronto
NOVEMBER
DECEMBER
JANUARY (2024)
46
ANNUAL REPORT 2023
ANNUAL REPORT 2023
47
Indigenous Relations
This commitment is demonstrated by building respectful
relationships founded on open communication and seeking
collaborative business opportunities with Indigenous partners
and vendors as well as investing in skills development initiatives
and scholarships that support the aspirations of Indigenous
Peoples pursuing careers in the construction industry.
Reflected in Bird’s national Indigenous
Engagement Policy, the Company commits to
approach our engagement in a consistent and
culturally appropriate manner, while considering
the Truth and Reconciliation call to Action #92
and respecting the diversity of the Indigenous
landscape in Canada. This commitment drives the
Company to partner with clients to ensure that we
are aligned in both approach and expectations.
Bird seeks to engage and consult with Indigenous
peoples to encourage their active participation in
the workforce and subcontracting opportunities.
Bird understands that contribution to economic
reconciliation includes employing Indigenous
peoples, purchasing from Indigenous businesses,
conducting business with Indigenous partners, and
conducting meaningful engagement.
Delivering projects across Canada and for a
wide variety of sectors, the Company works with
a diverse group of employees, subcontractors,
partners, and clients including a growing number
of projects and partnerships with Indigenous
communities and companies.
10%
Indigenous Representation on Board
>$132,000
Donations and Sponsorships
in Indigenous Communities1
45+
Indigenous-owned
Businesses Supported1
>$26M
Total Spend With Indigenous
Subcontractors and Suppliers1
To promote this advancement,
Bird has a mandatory Indigenous
Cultural Awareness Training
program for all Bird employees,
in place for the past seven years.
Training for all Bird employees
ensures we internally promote
positive relationships with
Indigenous individuals, businesses,
and communities as the Company
continues to make investments in
people, projects, and partnerships.
1Dataasofyear-end2022;full-yearfigureswillbeavailableinBird’s2023
Sustainability Overview released May 14, 2024.
ANNUAL REPORT 2023
49
Indigenous Partnerships
Our engagement with Indigenous businesses
and communities across Canada has shown
the improved value and outcomes that can be
achieved through respectful partnerships and
engagement across a project’s lifespan. The
best practices that we have learned through
these endeavours have informed our broader
approach towards social procurement in all
communities, and the potential to leverage
our procurement spend to realize positive
economic, environmental, cultural, and social
impacts in the communities in which we work
and live.
Bird’s partnerships with Indigenous
communities range from informal agreements
to work together (typically a Memorandum
of Understanding (“MOU”)) to incorporated
jointly-owned business entities. The type of
partnership is usually a reflection of the strength
of the relationship between Bird and the
Indigenous community with a new relationship
documented with an MOU and more mature
relationships advancing to an incorporated
jointly-owned business entity.
Scan to view video
On January 18th, 2024, Bird made a significant
announcement regarding the acquisition of
assets of NorCan Electric Inc. (“NorCan”),
a leading electrical contractor. Since 2018,
NorCan has operated through an Indigenous
partnership, the NorCan/Infinity Limited
Partnership, with Infinity Métis Corporation.
“We are extremely excited to
be forming this Indigenous
partnership with Bird. This will
positively impact the McMurray
Métis with the opportunities
this partnership presents for the
community and its Members.”
Shawn Myers,
President & CEO of Infinity
Métis Corporation
“We are very pleased to
welcome the NorCan team
to Bird, and we look forward
to working with the Infinity
Métis Corporation to continue
delivering excellence in the
region while supporting
economic action and
reconciliation by creating
opportunities for growth in
the community.”
Teri McKibbon,
President and CEO of Bird
50
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51
We strive to optimize our positive social and
environmental impact by exploring how we
can build smarter and greener.
Environmental,
Social and Governance
Bird’s ESG Program continues to mature in
alignment with internal strategic priorities and
the evolution of industry and client demands.
We strive to optimize our positive social and
environmental impact by exploring how we can
build smarter and greener, utilizing a strong
corporate governance framework that ensures
accountability and stewardship across all our
operations. Our teams have continued advancing
Bird’s internal readiness for forthcoming
disclosure requirements, which includes tracking
the Company’s GHG emissions profile across
all project sites and offices, in accordance with
the methods detailed in the internationally
recognized Greenhouse Gas Protocol and
relevant ISO standards. Bird has also committed
to set near-term and long-term emissions
reductions in line with climate science with the
Science Based Target initiative, aligning with
the internal processes underway to achieve
emissions reductions on our sites.
14
Bird will release its 2023 Sustainability Overview on May 14, 2024.
We encourage you to visit Bird’s website for more information on
Bird’s Indigenous Relations and our ESG initiatives.
50
ANNUAL REPORT 2023
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51
2023
Management’s
Discussion &
Analysis
for the years ended
December 31, 2023 and 2022
ANNUAL REPORT 2023
53
MANAGEMENT'S DISCUSSION AND ANALYSIS
TABLE OF CONTENTS
EXECUTIVE SUMMARY .................................................................................................................................................... 54
NATURE OF THE BUSINESS ........................................................................................................................................... 55
2023 HIGHLIGHTS ............................................................................................................................................................. 59
ANNUAL RESULTS OF OPERATIONS ........................................................................................................................... 61
QUARTERLY RESULTS OF OPERATIONS ..................................................................................................................... 64
KEY PERFORMANCE INDICATORS ............................................................................................................................... 66
OUTLOOK .......................................................................................................................................................................... 68
CAPABILITY TO DELIVER RESULTS ............................................................................................................................... 69
FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY ......................................................................... 70
CONTRACTUAL OBLIGATIONS ..................................................................................................................................... 74
FINANCIAL INSTRUMENTS ............................................................................................................................................ 74
DIVIDENDS ......................................................................................................................................................................... 76
OUTSTANDING COMMON SHARE DATA AND STOCK EXCHANGE LISTING .................................................... 76
OFF BALANCE SHEET ARRANGEMENTS .................................................................................................................... 76
RELATED PARTY TRANSACTIONS ................................................................................................................................ 76
SUMMARY OF QUARTERLY RESULTS ........................................................................................................................... 77
ACCOUNTING POLICIES ................................................................................................................................................ 78
CRITICAL ACCOUNTING ESTIMATES & JUDGEMENTS ........................................................................................... 78
CONTROLS AND PROCEDURES ................................................................................................................................... 80
RISKS RELATING TO THE BUSINESS ............................................................................................................................. 80
TERMINOLOGY AND NON-GAAP & OTHER FINANCIAL MEASURES ................................................................... 88
FORWARD-LOOKING INFORMATION ......................................................................................................................... 90
The following Management’s Discussion and Analysis (“MD&A”) of Bird Construction Inc.’s (“the Company” or
“Bird”) financial condition and results of operations for the three and twelve months ended December 31, 2023,
should be read in conjunction with the December 31, 2023 consolidated annual financial statements. This MD&A
has been prepared as of March 5, 2024. Unless otherwise specified, all amounts are expressed in Canadian
dollars. The information presented in this MD&A is presented in accordance with IFRS Accounting Standards
(“IFRS”), unless otherwise noted.
This discussion contains forward-looking statements and information, which are subject to a variety of factors that
could cause actual results to differ materially from those contemplated by this information. See “Forward-Looking
Information”. Some of the factors that could cause results or events to differ from current expectations include,
but are not limited to, the factors described in the “Risks Relating to the Business” section of this MD&A.
Additional information about the Company is available through the System for Electronic Document Analysis and
Retrieval (“SEDAR+”) at www.sedarplus.ca and on the Company’s website at www.bird.ca.
Throughout this MD&A certain measures are used that, while common in the construction industry, do not have a
standardized meaning prescribed by IFRS and are considered specified financial measures. These include non-
GAAP financial measures, non-GAAP financial ratios and supplementary financial measures. These measures may
not be comparable with similar measures presented by other companies. Further information regarding these
measures can be found in the “Terminology and Non-GAAP & Other Financial Measures” section of this MD&A.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
53
EXECUTIVE SUMMARY
(in thousands of Canadian dollars, except per share
amounts)
Income Statement Data
Revenue
Net income
Basic and diluted earnings per share ("EPS")
Adjusted Earnings (1)
Adjusted Earnings Per Share (1)
Adjusted EBITDA (1)
Adjusted EBITDA Margin (1)
Cash Flow Data
Twelve months ended December 31,
2023
2022
2021
$
2,798,785
$
2,369,332
$
2,220,026
71,539
1.33
74,230
1.38
138,749
49,863
0.93
46,024
0.86
101,185
42,783
0.80
50,954
0.96
108,136
5.0 %
4.3 %
4.9 %
Net (decrease) increase in cash and cash equivalents
$
2,938
$
(15,691) $
(21,725)
Cash flows from operations before changes in non-cash
working capital
Capital expenditures(2)
Cash dividends paid
Cash dividends declared per share
Balance Sheet Data
Total assets
Working capital
Loans and borrowings
ROU Liabilities
Shareholders' equity
Key Performance Indicators
Pending Backlog (1)
Backlog (3)
144,407
(30,956)
(22,564)
0.42
114,370
(27,766)
(20,941)
0.39
102,623
(11,756)
(20,749)
0.39
December 31,
2023
December 31,
2022
December 31,
2021
$
1,424,364
$
1,226,734
$
1,137,148
234,010
72,926
78,430
322,494
184,632
75,091
73,259
272,988
$
3,007,400
$
2,489,900
$
3,448,237
2,636,543
151,810
78,681
79,358
243,488
1,624,700
3,002,509
(1) Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. These measures, along with Adjusted Earnings Per Share,
Adjusted EBITDA Margin and Pending Backlog do not have standardized meanings under IFRS and may not be comparable with similar
measures presented by other companies. See "Terminology and Non-GAAP & Other Financial Measures."
(2) Represented by "Additions to property and equipment and intangible assets" in the consolidated statement of cash flows.
(3) Backlog is a measure that may not be comparable with a similar measure presented by other companies. See "Terminology and Non-
GAAP & Other Financial Measures."
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
54
Revenue (millions)EPS / Adj. EPSRevenue, Earnings Per Share and Adjusted Earnings Per Share$2,220$2,369$2,799Revenue (TTM)EPS (TTM)Adj. EPS (TTM)202120222023$—$500$1,000$1,500$2,000$2,500$3,000$—$0.25$0.50$0.75$1.00$1.25$1.50$1.75
Nature of
the Business
Overview
Bird is a Canadian construction and maintenance company providing a
comprehensive and a diversified portfolio of services and solutions to
industrial, infrastructure and buildings markets including: new construction
and retrofits; industrial maintenance, repair and operations ("MRO") services,
shutdowns and turnarounds; civil infrastructure construction; mine support
services; utility contracting; fabrication; steel modular construction; and
specialty trades.
The Company has been in operation for over 100 years, and draws upon the
extensive experience of over 5,000 employees to deliver exceptional
operational performance and collaborative execution across all project sizes
and delivery models.
Our Locations
The Company operates from coast-to
coast and services all of Canada's
major geographic markets.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
55
HOW WE DO BUSINESS
Over the past six years, Bird has strategically diversified its revenue sources while shifting
to a risk-balanced mix of work through disciplined project selection. This period has also
seen Bird establish itself as a leading collaborative contractor in Canada. Throughout this
transition, Bird has enhanced its profitability and adjusted EBITDA margins. Today, Bird is
known for delivering complex and sophisticated projects across the
industrial,
infrastructure, and building markets.
Project Delivery Models: Bird executes projects and work programs with its clients using
a variety of delivery models and contract types, including: Construction Management
("CM"), Integrated Project Delivery (“IPD”), Alliance, Cost-Plus, Stipulated Sum, Unit
Price, Standard Specification Design-Build, Progressive Design-Build, Complex Design-
Build, Alternative Finance Projects, and Public Private Partnerships (“PPP”).
Of the delivery models and contract types, CM, IPD, Alliance, Cost-Plus, Stipulated Sum,
Unit Price, Standard Specification Design-Build and Progressive Design-Build contracting
types are considered low to medium risk by the Company, with the remaining
contracting types representing higher levels of risk.
Self-Perform Delivery: Self-perform work involves Bird utilizing its own employees and
resources to execute services and scopes, rather than subcontracting to third parties.
Bird leverages this approach and cross-sells its comprehensive range of self-perform
services along with the innovative services described below, across all market sectors.
Examples of these services and scopes include: civil services such as earthworks, concrete
works, roadworks and bridges; heavy civil services including mine site development and
other mining services; underground and process piping; equipment
installation;
fabrication; insulation and cladding; telecommunications infrastructure; and mechanical,
electrical and instrumentation services, including powerline and high voltage services.
MANAGING RISK
Bird’s primary constraints on growth are the availability and retention of qualified and
capable personnel who are available for projects, and the ability to secure new work at
industrial,
appropriate margins. Bird self-performs
infrastructure and MRO, while in other areas, the majority of construction may be
performed by Bird’s subcontractors.
large projects, particularly
in
Bird is successful in winning work through qualifications-based selection criteria and
contractual approaches to project delivery that align and incentivize all parties to achieve
project goals involving shared identification and management of risk, resulting in a risk-
balanced work program for the Company. Collaborative delivery models include Alliance,
IPD, certain CM contracts, Progressive Design-Build, and MSA's. While all CM is
considered low risk, the contractual agreement determines whether it is considered a
collaborative delivery project.
In the buildings market where some risks are transferred through subcontracting, the
scope of work of each subcontractor is generally defined by the same contract
documents that form the basis of the Company’s agreements with its clients. The terms
of the agreements between the Company and its clients are generally replicated in the
agreements between the Company and its subcontractors. These “flow-down” provisions
substantially mitigate the risk borne by the Company. Depending on the value of the
work, the Company may require bonds or other forms of contract security, including
enrolling our subcontractors in Bird’s subcontractor default insurance program, which
helps mitigate exposure to possible additional costs should a subcontractor not be able
to meet its contractual obligations.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
56
INDUSTRY SECTORS
INDUSTRIAL
Bird executes large and complex projects for clients primarily operating in the chemicals,
oil and gas, liquefied natural gas (“LNG”), natural resources, nuclear, power, renewable
energy, and water and wastewater sectors. Additionally, Bird delivers large, complex
industrial buildings, including manufacturing, processing, distribution, and warehouse
facilities, often in internal partnerships to leverage Bird's buildings expertise. Known for
its collaborative approach and early contractor involvement, Bird offers a range of
services covering the entire project lifecycle, from initial earthworks and foundations and
process and non-process facilities, to long term maintenance, repair, and operations.
Bird self-performs a range of scopes including electrical and instrumentation, high
voltage testing and commissioning, as well as power line construction, structural,
mechanical, and piping, including off-site metal and modular fabrication. These industrial
service capabilities and capacity were significantly enhanced with the acquisition of
Stuart Olson Inc. (“Stuart Olson”) in September 2020 and further enhanced with the
acquisition of the assets of NorCan Electric Inc. in January 2024. Bird's expanded
industrial general contracting business is augmented with industrial maintenance
contracting and additional civil and facilities maintenance services, which have expanded
opportunities for additional maintenance clients in a broader geographical footprint.
INFRASTRUCTURE,
COMMERCIAL
SYSTEMS AND
UTILITIES
Bird has a well-developed offering of civil and structural construction capabilities
essential for infrastructure projects. The Company has played an active role in the
delivery of civil infrastructure across Canada’s power, mining, transportation, and utilities
markets for both public and private sector clients for many years. The offering includes
site preparation, earthworks, underground piping, utilities, drilling, blasting, and
foundations and other concrete services. In the mining sector, Bird provides site
development, mine support and contract mining services. Bird also performs a full suite
of scopes on greenfield and brownfield hydroelectric facilities.
The Company’s acquisition of Dagmar Construction Inc. (“Dagmar”) in September 2021,
provided a platform to expand Bird’s national civil capabilities, including enhancing self-
perform capacity across key civil infrastructure sub-sectors including rail, bridge, road,
installation. Dagmar’s capabilities and service offerings,
and underground utility
integrated with Bird’s existing civil business, improve Bird’s competitive position
nationally and provide greater access to the attractive Ontario market and enables the
Company to capitalize on a higher portion of self-perform work in larger, complex
projects.
Bird delivers a range of commercial systems and utility services, including the design and
installation of complex electrical and mechanical infrastructure, data communications,
telecommunications, security, and lifecycle services, including national roll-out services
that provide private and public sector clients with a range of ongoing electrical
maintenance service functions across Canada. Bird delivers these and other related
critical infrastructure services across all of the sectors where Bird operates, including
power, data and intelligence, healthcare, education, transportation, multi-residential, and
manufacturing and other light industrial. On January 31, 2023 Bird announced the
acquisition of Trinity Communication Services Ltd.
(“Trinity”), an Ontario-based
diversified telecommunication and utility infrastructure contractor. This acquisition added
specialized self-perform capabilities including underground, aerial, commercial inside
plant, and multi-dwelling unit installations. Additional value is added to projects through
pre-planning and design, prefab, building information modeling ("BIM") and virtual
design construction ("VDC"), and in-house software tools such as real-time performance
modules. Reliable power distribution and efficient communication networks are essential
to support growing requirements stemming from the rapid evolution of technology and
increasing electrification needs created by decarbonization efforts. The Company’s
commercial systems and utilities business is one of Canada’s largest electrical and data
system contractors.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
57
BUILDINGS
Bird's buildings expertise spans across all sectors. Bird constructs and retrofits
institutional facilities, including healthcare, long term care, post-secondary education,
transportation, public safety and defence facilities, as well as K-12 schools, public spaces,
and government buildings. The Company's capabilities also include new construction
and retrofit of warehousing, manufacturing and processing facilities, laboratories, data
centres, office buildings, retail spaces, film studio infrastructure, hotels, and select mixed-
use mid- to high-rise residential buildings. Bird provides comprehensive services
covering every aspect of a project’s lifecycle, from design-assist and preconstruction to
construction, commissioning, and lifecycle services. Furthermore, Bird leverages its
Centre for Building Performance and sustainable buildings expertise to help our clients
create design-focused buildings that are operationally efficient and built to last.
INNOVATIVE SOLUTIONS
Bird provides many innovative solutions to all of the sectors it services, including:
MASS TIMBER
CENTRE FOR BUILDING PERFORMANCE
Bird is a North American leader in mass
timber construction, with an extensive
resume including post-secondary education,
recreation and seniors’ living facilities. Bird
has the expertise, experience, and supply
chain to present an opportunity for greener
buildings by using a renewable resource as a
primary construction material.
In addition to its carbon capture benefits,
studies have shown that visible wood in
buildings has various psychological and
physical impacts that can lead to higher
occupant satisfaction, lower stress levels and
blood pressure, better concentration, and
increased optimism.
The growing popularity of mass timber as a
primary building material for structures from
high-rise wood frame housing developments
to
is
indicative of a shift to buildings that are
good for the environment and good for
people.
institutional buildings
large-scale
The Centre for Building Performance facilitates seamless
construction delivery that minimizes environmental impacts
throughout every step of the construction process and
supports the lifecycle of a building asset. The effective
deployment of technology, including the use of sensors
and BIM/VDC, reduces waste generated during the
construction process and optimizes the use of
fuel
resources, for example, during heating and curing cycles.
Integrating all building systems data provides visibility into
a building’s performance, ensuring it performs as designed
or better. These insights can generate analytics, reports,
and trends through a single customized dashboard for
asset owners to ensure efficiency is maintained.
Building performance solutions can reduce overall capital
budgets by optimizing building systems and infrastructure
while ensuring a high-performance building and faster
occupancy handover. Post occupancy, in-house designed
solutions provide valuable
insights that help simplify
building management and maintenance decisions,
reducing operating costs and improving efficiency, and
ultimately impacting the overall carbon intensity of the
building.
INNOVATIVE TRENCHING SOLUTIONS
CENTRES OF EXCELLENCE
that
Innovative Trenching Solutions provides single-pass
trenching with the use of custom-built, proprietary
equipment
of
expedites
underground utilities for oil and gas, renewables,
water, and telecommunications infrastructure. The
system minimizes environmental impact by reducing
ground disturbance and construction footprint while
maintaining better stability across a variety of terrain.
installation
Drawing on our subject matter experts, the Centres
of Excellence provide thought
leadership and
direction in key areas, leading the way in exploring
and adopting new technology, tools, relationships,
techniques, and/or best practices that reduce risk
and improve Bird’s profitability, effectiveness, and
reputation in a particular focus area, such as Net
Zero, deep carbon retrofits and energy transition.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
58
STACK MODULAR
Bird’s partnership with Stack Modular, a global design-build structural steel modular manufacturer, is an
innovative solution in the multi-family, hospitality, resource, and student and senior housing sectors. The
partnership is focused on helping clients leverage the advantages of combining conventional and modular
methods of construction, enabling time and cost savings, and ensuring delivery of high-quality, local code
compliant modules with stakeholder assurance that projects will be executed successfully and safely.
2023 HIGHLIGHTS
With the completion of the second year of Bird's 2022-2024 strategic plan, the Company has made great progress
in safely advancing our strategic priorities. Building on a solid 2022, Bird's 2023 fiscal year delivered significant
organic revenue growth, continued accretion of Adjusted EBITDA margins, and strong operational cash flow. The
Company also expanded its infrastructure presence in Canada as evidenced by the recently announced Alliance
Development Agreement to work collaboratively with Metrolinx to deliver the East Harbour Transit Hub. Bird
continued to pursue accretive tuck-in acquisitions with high growth potential, notably with the acquisitions of
Trinity in February 2023 and NorCan announced subsequent to year-end, and continued to experience robust
performance from earlier acquisitions. The Company's highly valued team grew in 2023 to meet the needs of
Bird's expanding work programs, with Bird being successful in attracting, retaining and developing talent
throughout the year.
FULL-YEAR 2023 COMPARED TO FULL-YEAR 2022
• Construction revenue of $2,798.8 million was earned in 2023, compared to $2,369.3 million in 2022,
representing a 18.1% increase year-over-year.
• Net income and earnings per share for the year were $71.5 million and $1.33, compared to $49.9 million
and $0.93 in 2022, representing increases of 43%.
• Adjusted Earnings1 and Adjusted Earnings Per Share were $74.2 million and $1.38 in 2023, compared to
$46.0 million and $0.86 in the prior year, representing increases of 61%.
• Adjusted EBITDA1 for 2023 was $138.7 million, or 5.0% of revenues, compared to $101.2 million, or 4.3%
of revenues in 2022, representing an increase of 37.1%.
FOURTH QUARTER 2023 COMPARED TO FOURTH QUARTER 2022
• Construction revenue of $792.1 million earned in the quarter compared to $649.0 million earned in the
prior year quarter, representing a 22.1% increase year-over-year.
• Net income and earnings per share were $23.9 million and $0.44 in Q4 2023, compared to $14.9 million
and $0.28 in Q4 2022, representing increases of 60%.
• Adjusted Earnings1 and Adjusted Earnings Per Share were $24.3 million and $0.45 in Q4 2023, compared
to $15.5 million and $0.29 in Q4 2022, representing increases of 57%.
• Adjusted EBITDA1 of $43.9 million, or 5.5% of revenues, compared to $30.6 million, or 4.7% of revenues in
Q4 2022, representing an increase of 43.2%.
• Bird continued to deliver significant revenue growth in the fourth quarter of 2023 driven predominantly by
organic growth, with additional contributions from Trinity, acquired on February 1, 2023.
1 Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. See “Terminology and Non-GAAP & Other Financial
Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
59
• The Company's margin profiles in the fourth quarter of 2023 continued to improve compared to the prior year,
with Gross Profit Percentage increasing to 9.2% compared to 8.9%, and Adjusted EBITDA Margin increasing to
5.5% from 4.7%.
• Bird added over $1.4 billion in securements to its Backlog in the fourth quarter ($3.6 billion year-to-date),
resulting in a record Backlog of over $3.4 billion at year-end. Pending Backlog of awarded but not yet
contracted work remains at a healthy $3.0 billion at year-end, and continues to include almost $1.1 billion of
MSA and other recurring revenue to be earned over the next seven years.
• During the quarter, the Company renewed and amended its Syndicated Credit Facility, extending the maturity
to December 15, 2026, expanding the size of the revolving facility to $250 million, and adding the availability
for an additional term loan facility which was subsequently used to complete the acquisition of assets of
NorCan Electric Inc. in January 2024.
• In December, based on the strength of Bird's outlook for significant further improvements in earnings and cash
flow in 2024 compared to 2023, the Company approved a 30.2% increase in its annualized dividend to $0.56
per share. The increased monthly dividend of $0.0467 per share will commence with the March 2024 dividend,
to be paid in April 2024.
• Bird generated $104.8 million in operating cash flow for the fourth quarter while continuing to fund a modest
investment in non-cash working capital required to support significant growth in the Company's work
program. The Company's liquidity position remains strong, with $177.5 million of cash and cash equivalents at
year-end, and an additional $215.5 million available under the Company's Syndicated Credit Facility.
• During the fourth quarter of 2023, the Company announced that it was awarded the following projects and
contracts:
◦
◦
◦
Bird, as part of a 50/50 general partnership, entered into an agreement for early works at a new LNG
project in Western Canada. Bird's portion of the limited notice to proceed contracts exceeds $150
million.
Bird announced that it had been awarded a construction management contract for the Seneca
Polytechnic Health & Wellness Centre Project, as well as a new multi-year task order under the previously
announced Port Hope Area Initiative Master Construction Contract by Canadian Nuclear Laboratories.
The combined value of the awards exceeds $130 million.
Bird announced that it had been awarded five new contracts in multiple sectors including energy, power
generation, manufacturing and multi-storey modular. The combined value of the contracts exceeded
$530 million.
• Subsequent to the year end, the Company announced in January 2024 that it had acquired the assets of
NorCan Electric Inc. (“NorCan”) for total consideration of $11 million. NorCan is a leading electrical and
instrumentation contractor providing maintenance turnaround and sustaining capital services in the Regional
Municipality of Wood Buffalo in Alberta. During their 25 years of service in the region, they have developed
deep, long-term relationships based on their strong service delivery and safety program. Since 2018, NorCan
has operated through an Indigenous partnership, the NorCan/Infinity Limited Partnership, with Infinity Métis
Corporation.
• Subsequent to the quarter end, the Company announced that it was awarded the following projects and
contracts:
◦
Bird, as part of a 50/50 joint venture, entered into an Alliance Development Agreement to work
collaboratively with Metrolinx to deliver the East Harbour Transit Hub, one of the first major projects in
Canada to be procured using an ‘alliance’ model.
• The Board has declared eligible dividends of $0.0467 per common share for each of March 2024 and April
2024, representing the 30% higher monthly dividend announced in December 2023.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
60
ANNUAL RESULTS OF OPERATIONS
Consolidated Statement of Income and Additional Financial Indicators
(in thousands of Canadian dollars, except per share amounts and percentages)
Construction revenue
Costs of construction
Gross profit
Income (loss) from equity accounted investments
General and administrative expenses
Income from operations
Finance and other income
Finance and other costs
Income before income taxes
Income tax expense
Net income for the period
Total comprehensive income for the period
Basic and diluted earnings per share
Adjusted Earnings(1)
Adjusted Earnings Per Share
Adjusted EBITDA(1)
Adjusted EBITDA Margin
2023
$
2,798,785 $
2022 % change
18.1 %
2,369,332
2,167,570
201,762
18.0 %
19.2 %
(2,714)
225.9 %
2,558,249
240,536
3,418
(142,781)
101,173
5,216
(13,158)
93,231
21,692
71,539 $
71,569 $
1.33 $
74,230 $
1.38 $
$
$
$
$
$
$
(132,386)
66,662
10,341
(9,818)
67,185
17,322
49,863
50,441
0.93
46,024
0.86
7.9 %
51.8 %
(49.6) %
34.0 %
38.8 %
25.2 %
43.5 %
41.9 %
43.0 %
61.3 %
60.5 %
37.1 %
0.7 %
138,749 $
101,185
5.0 %
4.3 %
(1) Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. See "Terminology and Non-GAAP & Other Financial
Measures."
For the year ended December 31, 2023, the Company recorded construction revenue of $2,798.8 million, a $429.5
million increase compared to $2,369.3 million of construction revenue recorded in 2022. The revenue growth for
the year was primarily organic, driven by significant increases in industrial construction and institutional building
construction, with additional growth generated from the Company's maintenance, repair and operations ("MRO")
services supported by the Company's extensive portfolio of recurring revenue contracts. As anticipated, new
industrial work in 2023 was more than sufficient to replace revenues from a large industrial work program which
successfully concluded during 2022. Trinity, acquired in February 2023, also modestly contributed to revenue
growth for the year.
The Company’s gross profit of $240.5 million for 2023, representing an 8.6% Gross Profit Percentage2, compares
to $201.8 million gross profit (8.5% Gross Profit Percentage) recorded in 2022. The Company's highly collaborative
work program, growing Backlog with enhanced margin profiles, and expanded self-perform capabilities continue
to drive strong gross profits on significant revenue growth, largely offsetting the favourable Gross Profit
Percentage impact of a large, mostly self-performed, industrial work program that benefited the early part of
2022.
Income from equity accounted investments for 2023 totalled $3.4 million, compared with losses of $2.7 million in
2022. The higher income in 2023 was primarily due to $4.9 million higher earnings related to Stack Modular and
$1.1 million higher income related to a multi-school project in Alberta.
2 “Gross Profit Percentage” does not have a standardized meaning under IFRS and may not be comparable with similar measures
presented by other companies. See “Terminology and Non-GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
61
General and administrative expenses were $142.8 million (5.1% of revenue3) for the year ended December 31,
2023, compared to $132.4 million (5.6% of revenue) in 2022. The primary drivers for the $10.4 million year-over-
year increase were: $1.1 million higher acquisition and integration costs and asset impairments driven primarily
from the rationalization of the Company's leased office space during the second quarter; $5.0 million higher
compensation costs, including accrued compensation costs and share-based payment costs net of the positive
impact of related derivatives due to a 77% increase in the market value of the Company's common shares; $3.8
million higher aggregate growth-related increases to travel, business development, recruitment and pursuit costs
as activity levels increased compared to 2022; and $1.6 million aggregate increases across other categories,
including general and administrative expenses of Trinity. Partially offsetting these increases were $0.8 million
lower amortization and depreciation.
Finance and other income of $5.2 million in 2023 was $5.1 million lower than 2022 primarily due to a $7.6 million
gain and $1.7 million of interest income recorded in the the second quarter of 2022 related to a settlement of
historical construction billings and related interest charges with a customer, partially offset by a $0.9 million fair
value loss on warrants received as part of the settlement. Partially offsetting this impact was $3.0 million higher
interest earned in the current year on the Company's cash balances due primarily to increases in deposit interest
rates. The additional interest earned on cash balances in 2023 offset the majority of higher interest expense
incurred on loans and borrowings reported in finance and other costs, discussed below.
Finance and other costs of $13.2 million in 2023 was $3.3 million higher than in the same period of 2022 primarily
due to increases to the Canadian prime rate and benchmark interest rate applied to the Company's variable rate
debt, partly offset by the Company carrying a modestly lower average debt balance outstanding on variable rate
credit facilities in the current year.
For the year ended December 31, 2023, income tax expense of $21.7 million increased compared to the $17.3
million expense recorded in 2022 driven by higher taxable income in the current year, which more than offset the
impact of a lower effective tax rate.
Total comprehensive income was $71.6 million for 2023, compared to $50.4 million in 2022. The increase was
primarily due to the Company's $21.7 million higher net income, discussed above, partially offset by lower gains
on the Company's pension plans.
Adjusted Earnings4 for the year ended December 31, 2023 was $74.2 million, compared with Adjusted Earnings of
$46.0 million in 2022. Adjusted Earnings reflects significant increases in year-to-date revenues and gross profit,
increases in income from equity accounted investments, described above, as well as $0.6 million higher finance
and other income, excluding the after-tax impact of a one-time gain which is excluded from Adjusted Earnings,
related to the settlement of historical construction billings in 2022. These increases were partially offset by $9.2
million higher general and administrative expenses, excluding the after-tax impact of acquisition and integration
expenses and asset impairments which are excluded from Adjusted Earnings, $3.3 million higher finance and
other costs driven by increasing interest rates, and $4.4 million higher income taxes.
3 “General and Administrative expenses as a percentage of revenue” does not have a standardized meaning under IFRS and may not
be comparable with similar measures presented by other companies. See “Terminology and Non-GAAP & Other Financial
Measures.”
4 Adjusted Earnings is a non-GAAP financial measure. See “Terminology and Non-GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
62
Net Income and Adjusted Earnings (in millions)$49.9$46.0$71.5$74.220222023Net incomeAdjusted earningsBasic and Diluted EPS and Adjusted EPS$0.93$0.86$1.33$1.3820222023Basic and diluted EPSAdjusted EPS
Basic and diluted earnings per share was $1.33 for 2023, compared to $0.93 in 2022. Adjusted Earnings Per Share
was $1.38 and $0.86 for 2023 and 2022, respectively. In addition to the impacts of changes in Net Income and
Adjusted Earnings discussed above, the basic weighted average shares outstanding for 2023 was higher by
72,607 due to common shares issued in connection with the Trinity acquisition in February 2023.
Adjusted EBITDA5 for the year ended December 31, 2023 was $138.7 million compared to $101.2 million recorded
in 2022. The $37.6 million year-over year increase was consistent with the increases in gross profit and income
from equity accounted investments discussed above, partially offset by growth-related increases in general and
administrative expenses, including compensation costs, and the inclusion of expenses of Trinity which was
acquired during the first quarter of 2023. Adjusted EBITDA margin for 2023 was 5.0%, compared to 4.3% in 2022,
with 2023 margins being lower for the first quarter of the year, then higher than 2022 amounts in the remainder of
the year. Adjusted EBITDA and Adjusted EBITDA Margin in the prior year benefited from a large, mostly self-
performed, industrial work program that concluded in 2022.
5 Adjusted EBITDA is a non-GAAP financial measure. See “Terminology and Non-GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
63
Adjusted EBITDA and Adjusted EBITDA Margin$101.2$138.74.3%5.0%Adj. EBITDAAdj. EBITDA Margin20222023
QUARTERLY RESULTS OF OPERATIONS
Consolidated Statement of Income and Additional Financial Indicators
(in thousands of Canadian dollars, except per share amounts and percentages)
Construction revenue
Costs of construction
Gross profit
Income (loss) from equity accounted investments
General and administrative expenses
Income from operations
Finance and other income
Finance and other costs
Income before income taxes
Income tax expense
Net income for the period
Total comprehensive income for the period
Basic and diluted earnings per share
Adjusted Earnings(1)
Adjusted Earnings Per Share
Adjusted EBITDA(1)
Adjusted EBITDA Margin
Three months ended December 31,
$
$
$
$
$
$
$
2023
792,068 $
718,856
73,212
1,601
(40,506)
34,307
1,206
(4,247)
31,266
7,385
23,881 $
23,900 $
0.44 $
24,295 $
0.45 $
43,868 $
5.5 %
2022 % change
22.1 %
648,967
590,889
58,078
(1,124)
(34,534)
22,420
904
(2,933)
20,391
5,459
14,932
15,257
0.28
15,485
0.29
30,639
4.7 %
21.7 %
26.1 %
242.4 %
17.3 %
53.0 %
33.4 %
44.8 %
53.3 %
35.3 %
59.9 %
56.6 %
57.1 %
56.9 %
55.2 %
43.2 %
0.8 %
(1) Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. See "Terminology and Non-GAAP & Other Financial
Measures."
The Company recorded construction revenue of $792.1 million in the fourth quarter of 2023, representing a
$143.1 million, or 22.1%, increase over amounts reported in the fourth quarter of 2022. Similar to prior quarters,
industrial construction and institutional building construction continued to drive organic growth, which exceeded
21% for the quarter, with additional contributions from Trinity which was acquired in February 2023. Revenue for
the fourth quarter was bolstered by strong execution and favourable weather conditions, which allowed
additional progress to be achieved on multiple projects across the Company's work programs.
Gross profit of $73.2 million for the fourth quarter of 2023, representing a Gross Profit Percentage of 9.2%, was
$15.1 million higher than the $58.1 million gross profit (8.9% Gross Profit Percentage) recorded a year ago. The
increase in gross profit margins continues to be driven by improved margin profiles on newer work resulting from
disciplined project selection and cost control, growing self-perform capabilities and cross-selling opportunities
across the Company, as well as a higher proportion of industrial construction executed in the quarter compared
to the prior year.
Income from equity accounted investments in the fourth quarter of 2023 was $1.6 million, compared to losses of
$1.1 million recorded in same period of 2022. The improvement was primarily driven by higher income from Stack
Modular, higher income from a multi-school project in Alberta, and the impact of a project in Western Canada
that was classified as held for sale during the first quarter of 2023 and subsequently sold in the second quarter of
2023.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
64
In the fourth quarter of 2023, general and administrative expenses were $40.5 million (5.1% of revenue) versus
$34.5 million (5.3% of revenue) in the corresponding period a year ago. The primary drivers of the $6.0 million
increase were: $3.2 million higher compensation costs in the current year quarter, including the impact of
increased accrued compensation costs, share-based payment costs and related derivatives; $1.8 million higher
growth-related increases to travel, business development, recruitment and pursuit costs driven by activity levels
increasing compared to 2022; and $1.2 million aggregate increases across other categories, including general
and administrative expenses of Trinity. Partially offsetting these increases were $0.2 million lower acquisition and
integration costs. Compensation costs in the quarter were higher compared to the prior year due in part to
significantly higher volume of work and profitability in the current period, as well as a $4.11 (40%) increase in the
market price of the Company's common shares during the quarter.
Finance and other income for the fourth quarter of 2023 was $0.3 million higher than in the prior year period,
primarily due to higher interest earned on the Company's cash balances due to increases in deposit interest rates.
Finance and other costs of $4.2 million in the fourth quarter of 2023 was $1.3 million higher than the same period
of 2022, primarily due to a higher average debt balances outstanding during the the quarter, including the impact
of short term borrowings to fund working capital, as well as higher Canadian prime rate and benchmark interest
rates in the current year.
In the fourth quarter of 2023, income tax expense was $7.4 million, compared to $5.5 million recorded in the
fourth quarter of 2022. Higher income tax expense for the fourth quarter of 2023 was driven by higher net income
before tax in the current year, partially offset by a lower effective tax rate.
In the fourth quarter of 2023, total comprehensive income was $23.9 million, compared to $15.3 million in the
fourth quarter of 2022. The increase is primarily due to the increase in net income of $8.9 million described above,
partially offset by lower actuarial gains on pension plans.
Adjusted Earnings6 for the fourth quarter of 2023 was $24.3 million, compared with Adjusted Earnings in the
fourth quarter of 2022 of $15.5 million, an increase of $8.8 million. Adjusted Earnings reflects higher gross profit
for the current quarter, increases in income from equity accounted investments and higher finance and other
income, partially offset by higher finance and other costs and higher income taxes, as described above, and $5.8
million higher general and administrative expenses, excluding the after-tax impact of acquisition and integration
expenses which are excluded from Adjusted Earnings.
Basic and diluted earnings per share was $0.44 in the fourth quarter of 2023, compared to $0.28 in the fourth
quarter of 2022. Adjusted Earnings Per Share was $0.45 and $0.29 in the fourth quarter of 2023 and 2022,
respectively. In addition to changes in Net Income and Adjusted Earnings discussed above, the weighted average
shares outstanding for the fourth quarter of 2023 was higher by 79,346 shares related to the Trinity acquisition on
February 1, 2023.
6 Adjusted Earnings is a non-GAAP financial measure. See “Terminology and Non-GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
65
Net Income and Adjusted Earnings (in millions)$14.9$15.5$23.9$24.3Q4 2022Q4 2023Net incomeAdjusted earningsBasic and Diluted EPS and Adjusted EPS$0.28$0.29$0.44$0.45Q4 2022Q4 2023Basic and diluted EPSAdjusted EPS
Adjusted EBITDA7 in the fourth quarter of 2023 was $43.9 million compared to $30.6 million earned in the fourth
quarter of 2022. The $13.2 million year-over-year increase was consistent with higher gross profit and the increase
in income from equity accounted investments discussed above, partially offset by growth-related increases in
general and administrative expenses, including compensation costs, and the inclusion of expenses of Trinity
which was acquired in February 2023. The Company's Adjusted EBITDA Margin improved to 5.5% in the fourth
quarter of 2023 compared 4.7% in the same period in 2022, reflecting improvements in Gross Profit Percentage,
discussed above, as well as gaining leverage on general and administrative costs as the Company's revenue grew
significantly compared to the prior year.
KEY PERFORMANCE INDICATORS
Securements, Pending Backlog and Backlog
Securing profitable construction contracts and then controlling the costs during the execution of that work are the
key drivers of success for the Company. To achieve this, new work must be available, which is a function of the
general state of the economy. In periods of strong economic growth, client capital spending will generally
increase and there will be more opportunities available in the construction industry. In economic downturns,
fewer opportunities typically exist and competition for those opportunities becomes more intense, generally
resulting in lower Gross Profit Percentages. The Company must be successful in securing profitable work in
various economic conditions. The construction industry is highly fragmented and, accordingly, the Company
competes with several international, national, regional, and local construction firms. The Company’s competitive
advantages include its long-standing reputation for successfully delivering high quality projects that fully meet the
needs of the customer and in delivering projects collaboratively which enables the Company to secure repeat
business from existing clients and win work with new clients.
The Company’s success in securing work is reflected in the values of its Pending Backlog and Backlog. The
following table shows the Company’s balances at the end of the following reporting periods:
(in thousands of Canadian dollars)
Pending Backlog
Backlog
December 31,
2023
December 31,
2022
$
$
3,007,400
3,448,237
$
$
2,489,900
2,636,543
Pending Backlog at December 31, 2023 was $3,007.4 million compared to $2,489.9 million at December 31, 2022,
an increase of $517.5 million or 20.8%. The Company’s Backlog of $3,448.2 million at December 31, 2023
exceeded the balance at December 31, 2022 by 30.8%, with new contracts secured exceeding executed work by
$811.7 million.
7 Adjusted EBITDA is a non-GAAP financial measure. See “Terminology and Non-GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
66
Adjusted EBITDA and Adjusted EBITDA Margin$30.6$43.94.7%5.5%Adj. EBITDAAdj. EBITDA MarginQ4 2022Q4 2023
Bird has a strong reputation for delivering sophisticated projects in a collaborative framework. As the Company
pursues and participates in more of these projects, there may be client-driven requirements for early contractor
involvement and pre-construction services. Bird’s participation at earlier stages of the project development cycle
can result in significant amounts of awarded project value being booked to and remaining in Pending Backlog for
longer periods of time before transitioning to contracted Backlog. Due to the nature of the early involvement,
smaller portions of work are typically contracted during initial phases of the project while working collaboratively
to ensure the cost estimate, schedule forecast, and project planning are sufficiently advanced before contracts
are executed for construction phases.
Pending Backlog includes almost $1,100 million of recurring revenue contracts, primarily consisting of multi-year
MSA, maintenance, task order, and similar contractual arrangements. These contracts are typically with industrial
clients, span multiple years, and represent a recurring revenue stream over the next seven years, with the
Company converting these contracts to Backlog on a regular basis as purchase orders or other formal documents
to proceed are received. The remaining projects included in Pending Backlog are geographically diverse, span
multiple sectors, and are generally lower risk contract types and collaborative in nature.
The following table outlines the changes in the amount of the Company’s Backlog throughout the current and
prior reporting periods:
(in millions of Canadian dollars)
Opening balance
Securements, change orders & other adjustments
Realized in construction revenues
Closing balance
Year ended
December 31,
2023
Year ended
December 31,
2022
$
$
2,636.5
$
3,610.5
(2,798.8)
3,448.2
$
3,002.5
2,003.4
(2,369.3)
2,636.5
Gross Profit Percentage
After the Company has secured a contract, the profitability of that contract, measured by the Gross Profit
Percentage, is primarily a function of initial pricing based on market conditions, management’s ability to control
costs, achieve productivity objectives associated with the contract and resolve commercial issues if they arise.
For 2023, the Company realized a Gross Profit Percentage of 8.6% compared with 8.5% in 2022. During the fourth
quarter of 2023, the Company realized a Gross Profit Percentage of 9.2% compared with 8.9% in fourth quarter of
2022. The year-over-year changes in Gross Profit Percentage for the quarter and year-to-date are discussed in the
sections above titled “Annual Results of Operations” and “Quarterly Results of Operations”.
Financial Condition
The Company must have adequate working capital and equity retained in the business to support its ongoing
operations, including surety and contract security requirements. The Company continually monitors the adequacy
of its working capital and equity to satisfy contract security needs. Working capital is calculated as total current
assets less total current liabilities.
The following table shows the working capital and shareholders’ equity balances of the Company at the end of
the current and prior reporting periods:
(in thousands of Canadian dollars)
Working capital
Shareholders' equity
December 31,
2023
December 31,
2022
$
$
234,010
322,494
$
$
184,632
272,988
Further discussion of the change in the Company’s working capital and shareholders’ equity balances is provided
in the section entitled “Financial Condition, Capital Resources & Liquidity”.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
67
Health, Safety & Environment
Bird’s most important Corporate Value is ‘We Put Safety First’. This means ensuring that all work on the
Company’s sites is executed to strict operational safety standards and follows Bird's rigorous health and safety
systems. Furthermore, we foster a culture of caring for the well-being of all personnel that work on our projects.
Collectively these cornerstones form a culture that send our people home every day healthy and injury free.
Bird’s approach to developing a healthy safety culture begins with senior leadership demonstrating our health,
safety and environment ("HS&E") values and executing an integrated long-term strategic focus on risk reduction.
This strategic focus extends to project risk mitigation beginning with pre-project safety planning and strong
safety execution practices ranging from thorough onboarding routines and identification and control of hazards
through to regular HS&E program oversight and evaluation. We employ experienced project leadership as well as
trained and supported front line supervision. All the foregoing is underpinned by the Company's workforce and
trade partners being highly engaged in day-to-day safety expectations.
Ensuring that all employees leave the workplace every day just as healthy and safe as when they arrived is a
shared commitment and, by working collaboratively with employees and trade partners to achieve this, the
Company minimizes risk and creates the appropriate conditions for the safe execution of construction activity, on-
time, on budget, and to the client’s satisfaction. The Company believes this shared commitment is critical to its
overall success and is proud to be a leader and founding member of the Canadian Construction Safety Council
which aims to raise safety standards and performance across the industry with like-minded general contractors.
The Bird HS&E strategy is foundational to achieving the foregoing. At Bird we are focused on three strategic
HS&E pillars – engagement, culture, and effective safeguards. Each of these pillars aims and anchors the
Company’s efforts towards establishing sustainable HS&E systems and results, a leadership team that cares, an
engaged workforce, and robust controls that prevent loss.
The following table shows the Company’s safety key performance indicators for the following current and prior
reporting periods:
Person-hours of work
Lost time incidents ("LTI")
Lost time incidents frequency ("LTIF")
OUTLOOK
Year ended
December 31,
2023
Year ended
December 31,
2022
10,591,963
10,002,845
0
0.00
1
0.02
Throughout 2023, Bird continued to advance its strategic priorities, strengthening full-year Adjusted
EBITDA margins to 5.0% and achieving organic revenue growth exceeding 17%. The Company grew its
combined backlog to record levels in higher demand and higher margin sectors while maintaining its
risk-balanced, disciplined approach to project selection. The Company's portfolio of complex and
highly collaborative projects from coast to coast to coast, growing contribution from recurring revenue
contracts, coupled with disciplined cost management all provide good visibility to continued growth
and EBITDA margin accretion in 2024 and beyond.
Bird's fourth quarter results delivered substantial organic revenue growth and continued Gross Profit and
Adjusted EBITDA margin accretion, and provide good momentum for the Company as we enter into our 2024
fiscal year. Top line organic growth is expected to continue through 2024, with seasonal patterns favouring the
second half of the year as usual, and the Company anticipates significant improvements to earnings and cashflow.
With the Company's continuing strategic focus on Adjusted EBITDA margin accretion, Bird also expects Adjusted
EBITDA and earnings per share growth to outpace organic revenue growth in 2024. Reflecting the confidence in
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
68
its 2024 outlook, the Company announced a 30% annualized dividend increase in December 2023, raising the
monthly dividend to $0.0467 per share commencing with the March 2024 dividend to be paid in April.
Heading into 2024, the Company has a Backlog of contracted work exceeding $3.4 billion, an all-time high for
Bird, which continues to reflect higher embedded margins resulting from Company's disciplined sector focus and
project selection approach, and focus on collaboration and cross-selling. Over $1.4 billion of new securements
were added to Backlog in the fourth quarter of 2023, diversified across regions and sectors, and include awards in
energy and power, manufacturing, mining, modular construction, institutional buildings and transportation. Bird
also has over $3.0 billion of expected future work in Pending Backlog, including a robust portfolio of recurring
revenue contracts approximating $1.1 billion, which are expected to convert to Backlog over the next one to
seven years. The combination of Backlog and Pending Backlog, along with a significant volume of attractive
opportunities actively being pursued, provide Bird with significant visibility into future revenues and profitability,
underpinning the Company's expectations for 2024 and beyond.
Bird continues to pursue new work selectively, ensuring strategic alignment between capabilities, project type
and delivery model. Bird’s strong focus on early contractor involvement and collaborative opportunities drives a
larger share of negotiated work and improves project delivery and outcomes for all parties. Sustained demand in
Bird’s core markets - industrial, infrastructure and buildings - continues to drive a robust bid pipeline in the short
to medium term. Bird's focus on sectors such as energy transition and electrification, nuclear, major multi-year
industrial projects, and infrastructure modernization position the Company well to meet the longer-term demand
outlook.
While delivering sustained margin accretion and revenue growth, Bird remains focused on maintaining a healthy
balance sheet, which is underpinned by strong operating cash flow generation and a low level of long-term debt,
to support strategic growth initiatives. Bird's balanced capital allocation approach aims for profitable long-term
growth and shareholder value creation through the return of capital to shareholders through sustainable
distributions of dividends, while allowing the Company to retain in excess of two-thirds of net income to support
continued organic growth and strategic M&A, such as the recent acquisition of NorCan Electric in January 2024,
and smart capital investments to support further productivity and growth.
"Success is a team effort. Our inclusive workplace enables our combined expertise,
humility and creativity to unlock our greater potential.
- We Are Stronger Together"
CAPABILITY TO DELIVER RESULTS
Productive capacity relates to the financial and non-financial resources available to the Company to execute its
strategy and achieve planned results. From a financial perspective, the Company believes it has sufficient working
capital and access to operating lines of credit to execute its near term operational and growth forecast, further
outlined in the Financial Condition, Capital Resources and Liquidity section.
The achievement of the Company's goals is not only based on financial stability, but also on the engagement and
leadership proficiency of our employees. Our 2022-2024 strategic plan prioritizes the development of a highly
engaged, high-performing team through innovative people programs. Annually, we identify and support the
growth of our top-performing employees through opportunities for career advancement and training. Our
performance management system places a strong emphasis on enhancing leadership skills, and we reinforce this
through various internal and external training programs, including the Bird Site Management program, Finance
for Non-Finance Managers, Frontline Leadership, and the Taking Flight management training program. These
programs serve as a platform for high-potential individuals to sharpen their leadership abilities and contribute to
the success of the Company.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
69
FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY
The following table presents a summary of the Company’s financial condition at the end of the following
reporting periods:
(in thousands of Canadian dollars)
Cash and cash equivalents
Non-cash working capital
Working capital
Non-current loans and borrowings
Non-current right-of-use liabilities
Shareholders' equity
December 31,
2023
December 31,
2022
$
$
$
$
$
177,529
$
56,481
234,010
64,621
57,680
322,494
$
$
$
$
174,607
10,025
184,632
68,007
55,469
272,988
As a result of the strength of the Company’s balance sheet and its Syndicated Credit Facility, the Company
believes it has sufficient amounts of both working capital and liquidity to execute its Backlog and to
accommodate expected growth in its diversified work program.
As a component of working capital, the Company maintains a balance of cash and cash equivalents. At
December 31, 2023, this balance totalled $177.5 million. Accessible cash at December 31, 2023 was $79.9 million
($96.0 million at December 31, 2022) with the remaining cash and cash equivalents balance held in trust or in joint
operations’ accounts. Accessible cash at December 31, 2023 decreased due to investments in working capital to
support the seasonal growth of the Company’s work programs, investments in property, plant and equipment
and intangible software, the acquisition of Trinity, and net repayment of borrowings and ROU liabilities, with
partially offsetting shifts in geographical project mix and stage of completion on certain major projects in regions
where trust cash requirements are enacted.
Non-cash working capital was $56.5 million at December 31, 2023, compared to $10.0 million at December 31,
2022. The investment in non-cash working capital utilized $46.5 million of cash year-to-date in 2023. The overall
use of cash is consistent with the Company’s significant growth throughout 2023 and seasonal expectations,
including shifts in project mix and the stage of completion on certain major projects.
The Company’s non-cash working capital position fluctuates significantly in the normal course of business from
period to period, primarily due to the timing of differences between the settlement of payables due to
subcontractors and suppliers, billings and collection of receivables from clients, and the timing in the settlement
of income taxes payable. The Company’s cash balances, and available credit facilities when needed, absorb these
fluctuations with no net impact to the Company’s net working capital position or ability to access contract surety
support.
At December 31, 2023, the Company had working capital of $234.0 million compared with $184.6 million at
December 31, 2022, an increase of $49.4 million. The primary driver of the increase was net income of $71.5
million exceeding dividends paid of $22.6 million by $49.0 million. Other reductions were driven by: $3.4 million
net repayments of non-current loans and borrowings; $9.9 million net investments in property, plant, equipment
and intangibles; $5.8 million repayments of non-current ROU liabilities in excess of related asset depreciation; and
the Company’s acquisition of Trinity net of acquired working capital of $1.8 million. These reductions were offset
by increases driven by: $14.3 million of non-current share based compensation expenses; and $7.1 million of non-
cash deferred taxes recorded in the year. The Company’s current ratio8 at December 31, 2023 was 1.26 compared
to 1.24 at December 31, 2022.
The $49.5 million increase in shareholders’ equity since December 31, 2022 was primarily due to the Company’s
net income of $71.5 million exceeding dividends declared by $48.8 million, plus the issuance of $0.7 million of
Bird common shares in connection with the acquisition of Trinity during the first quarter.
8 “Current ratio” is the percentage derived by dividing total current assets by total current liabilities. See “Terminology and Non-
GAAP & Other Financial Measures.”
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
70
Credit Facilities
The Company has a number of credit facilities in place, including a Syndicated Credit Facility, Equipment
Financing facilities, and Letters of Credit facilities, available to access in order to support the issuance of letters of
credit, finance future capital expenditures and finance the day-to-day operations of the business. The
composition and terms of these facilities are more fully described in Note 18 to the December 31, 2023
consolidated financial statements.
The following table outlines the amount of the credit facilities, the amount of issued letters of credit and the
amount of collateral pledged in support of the outstanding letters of credit at the end of the current and prior
reporting periods:
(in thousands of Canadian dollars)
Committed revolving credit facility
Letters of credit issued from committed revolving credit facility
Drawn from committed revolving credit facility
Available committed revolving credit facility
Committed non-revolving term loan facility
Cumulative repayments of committed non-revolving term loan facility
Drawn committed non-revolving term loan facility
Non-committed Available Accordion
Letters of credit facilities
Letters of credit issued from letters of credit facilities
Available letters of credit facilities
Collateral pledged to support letters of credit
Guarantees provided by EDC
December 31,
2023
December 31,
2022
$
250,000
$
11,816
22,725
215,459
47,500
$
(4,750)
42,750
50,000
150,000
38,853
111,147
90
38,763
$
$
$
$
$
$
$
$
$
220,000
25,312
22,725
171,963
47,500
—
47,500
50,000
150,000
51,627
98,373
90
51,537
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
71
Annual Cash Flow Data
The following table provides an overview of cash flows for the years ended December 31, 2023 and 2022:
(in thousands of Canadian dollars)
2023
2022
$ change
Cash flows from operations before changes in non-cash working
capital
$
144,407 $
114,370 $
30,037
Changes in non-cash working capital and other
Cash flows from (used in) operating activities
Investments net of capital distributions from equity accounted
entities
Proceeds on sale of investment in equity accounted entities
Additions to property, equipment and intangible assets
Proceeds on sale of property and equipment
Acquisitions, net of cash acquired
Other long-term assets
Cash flows from (used in) investing activities
Dividends paid on shares
Net proceeds (repayment) of draws for working capital purposes
Proceeds from loans and borrowings
Repayment of loans and borrowings
Repayment of right-of-use liabilities
Cash flows from (used in) financing activities
(68,607)
75,800
666
2,408
(30,956)
4,278
(5,827)
1,925
(27,506)
(22,564)
—
5,103
(7,268)
(20,627)
(45,356)
(70,971)
43,399
2,364
32,401
922
1,501
(27,766)
6,444
—
4,087
(256)
907
(3,190)
(2,166)
(5,827)
(2,162)
(14,812)
(12,694)
(20,941)
(1,623)
—
2,776
(6,366)
(19,747)
(44,278)
—
2,327
(902)
(880)
(1,078)
Increase (decrease) in cash and cash equivalents
$
2,938 $
(15,691) $
18,629
Operating Activities
For the year ended December 31, 2023, cash flows from operating activities generated cash of $75.8 million, $32.4
million more than the $43.4 million cash generated in the comparable period in 2022.
Cash flows from operations before changes in non-cash working capital of $144.4 million was $30.0 million higher
than the $114.4 million cash generated in 2022 primarily due to $21.7 million higher net income. In addition,
higher net addbacks of non-cash items of $8.1 million, consisting of $3.6 million lower gains on sale of property
and equipment, $3.3 million higher finance and other costs, $5.6 higher deferred compensation costs, and $4.4
million higher non-cash income tax expense were partially offset by $6.1 million higher income from equity
accounted investments, and $1.6 million higher finance and other income.
Cash used to fund changes in non-cash working capital and other improved $2.4 million compared to 2022 driven
mainly by reduced net cash outflows from accounts payable and contract liabilities ($53.0 million), lower outflows
related to provisions ($4.9 million) and deferred compensation ($16.1 million), and lower income tax payments
($2.2 million), partially offset by reduced net inflows related to accounts receivable and contract assets ($70.0
million), and higher net interest paid ($3.2 million). The Company's non-cash working capital position fluctuates
significantly from period to period, during the normal course of business, primarily due to timing differences
between billings and collection of receivables, settlement of payables due to subcontractors and suppliers, and
the timing of income taxes payable.
Investing Activities
For the year ended December 31, 2023, the Company used $27.5 million of cash in investing activities compared
to $14.8 million used in 2022. The $12.7 million higher use of cash was primarily due to $5.8 million net cash used
to acquire Trinity in February 2023, $3.2 million higher capital expenditures on property, equipment and
intangibles, $2.2 million lower proceeds on sale of property and equipment due to lower sale activity in the year,
and $2.2 million lower inflows related to long-term assets, primarily related to a higher release of insurance
deposits in the prior year, partly offset by $0.7 million increased net proceeds on sale of equity accounted
investments.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
72
Financing Activities
For the year ended December 31, 2023, the Company used $45.4 million of cash to fund financing activities,
largely comparable to the $44.3 used in 2022. The Company made $22.6 million of dividend payments and $27.9
million of scheduled repayments of loans and borrowings and ROU liabilities, offset by proceeds from equipment
financing of $5.1 million. In 2022, the Company made dividend payments of $20.9 million and scheduled
repayments of other loans and borrowings and ROU liabilities of $26.1 million, offset by $2.8 million proceeds on
equipment loans.
Quarterly Cash Flow Data
The following table provides an overview of cash flows during the three months ended December 31, 2023 and
2022:
(in thousands of Canadian dollars)
Three months ended December 31,
2022
2023
$ change
Cash flows from operations before changes in non-cash working
capital
$
Changes in non-cash working capital and other
Cash flows from (used in) operating activities
47,553 $
57,220
104,773
33,465 $
14,088
72,337
(15,117)
105,802
(1,029)
Investments net of capital distributions from equity accounted
entities
Additions to property, equipment and intangible assets
Proceeds on sale of property and equipment
Other long-term assets
Cash flows from (used in) investing activities
Dividends paid on shares
Net proceeds (repayment) of draws for working capital purposes
Proceeds from loans and borrowings
Repayment of loans and borrowings
Repayment of right-of-use liabilities
Cash flows from (used in) financing activities
181
(9,442)
2,123
178
(6,960)
(5,775)
(15,000)
2,620
(1,447)
(4,727)
(24,329)
264
(6,614)
3,055
(113)
(83)
(2,828)
(932)
291
(3,408)
(3,552)
(5,235)
(20,000)
—
(1,567)
(4,889)
(540)
5,000
2,620
120
162
(31,691)
7,362
Increase (decrease) in cash and cash equivalents
$
73,484 $
70,703 $
2,781
Operating Activities
During the fourth quarter of 2023, cash flows from operating activities generated cash of $104.8 million, a
decrease of $1.0 million compared to $105.8 million cash generated in the fourth quarter of 2022.
Cash flows from operations before changes in non-cash working capital of $47.6 million was $14.1 million higher
than the $33.5 million cash generated in 2022. The improvement resulted from higher net income of $8.9 million
in the current quarter and $4.9 million higher net addbacks for non-cash items on an aggregate basis, primarily
consisting of higher depreciation of $1.6 million, higher net finance and other costs of $1.3, higher deferred
compensation costs of $3.5 million, and higher non-cash income tax expense of $1.9 million, partially offset by
higher income from equity accounted investments of $2.7 million.
Cash generated by changes in non-cash working capital for the quarter decreased $15.1 million compared to the
fourth quarter of 2022, with largely offsetting increases in working capital driven by the Company's growing work
program. The primary changes included lower net inflows related to changes in accounts receivable and contract
assets ($60.5 million), higher net outflows related to prepaid expenses ($1.9 million), higher net interest paid ($2.0
million) and higher income tax payments ($4.9 million), largely offset by lower net outflows related to changes in
accounts payable and contract liabilities ($37.6 million), lower net outflows related to provisions ($1.9 million), and
lower net outflows related to deferred compensation ($14.6 million). The non-cash working capital position
fluctuates significantly in the normal course of business from period to period, primarily due to the timing of
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
73
differences between the settlement of payables due to subcontractors and suppliers, billings and collection of
receivables from clients, and the timing of the settlement of income taxes payable.
Investing Activities
During the fourth quarter of 2023, the Company used $7.0 million of cash in investing activities compared to $3.4
million used in 2022. The Company had $2.8 million higher capital expenditures on property, equipment and
intangibles in the current quarter, and received $0.9 million lower net proceeds on the sale of equipment and
equity accounted investments, which was partially offset by $0.3 million higher inflows related to long-term assets,
primarily related to the repayment of a note receivable in the current year quarter.
Financing Activities
During the fourth quarter of 2023, the Company used $24.3 million of cash related to financing activities,
comprised of $5.8 million of dividend payments, $15.0 million of repayments of temporary draws on its revolving
credit facility used to fund working capital requirements in prior quarters, and $6.2 million of scheduled
repayments of loans and borrowings and ROU liabilities, partially offset by $2.6 million proceeds on new
equipment financing. In the same period of 2022, the Company made dividend payments of $5.2 million, made
net repayments of temporary draws on its revolving credit facility of $20.0 million, and made scheduled
repayments of loans and borrowings and ROU liabilities of $6.5 million.
CONTRACTUAL OBLIGATIONS
At December 31, 2023, the Company has future contractual cash flow obligations of $826.7 million. Interest
payments on the committed revolving credit facility and committed non-revolving term loan facility are not
included in the table below since they are subject to variability based upon outstanding balances at various
points throughout the period and variable interest rates.
(in thousands of Canadian dollars)
Trade payables
Dividends payable
ROU liabilities
Not later
than 1 year
2 – 3 years
4 – 5 years
Later than 5
years
Contractual
cash flows
Carrying
amount
$ 591,577 $
48,345 $
1,925
—
41 $
—
— $ 639,963 $ 639,963
— $
1,925
23,975
35,157
15,641
12,710 $
87,483
Committed revolving credit facility
—
22,725
Committed non-revolving term loan
Equipment financing
Acquisition holdback
Lease commitments
Other purchase commitments
5,938
2,717
—
5,287
6,094
—
—
36,812
4,167
1,328
300
—
—
—
7,659
4,349
— $
— $
— $
— $
— $
— $
22,725
42,750
8,212
300
5,287
18,102
1,925
78,430
22,725
42,750
7,451
300
n/a
n/a
$ 637,513 $ 155,165 $
21,359 $
12,710 $ 826,747 $ 793,544
FINANCIAL INSTRUMENTS
Financial instruments consist of recorded amounts of derivative contracts, accounts receivable and other like
amounts that will result in future cash receipts, as well as accounts payable, dividends payable, loans and
borrowings, and any other amounts that will result in future cash outlays. The fair value of the Company’s loans
and borrowings approximate their carrying values on a discounted cash flow basis as the majority of these
obligations bear interest at market rates. The fair values of the remaining financial instruments approximate their
carrying value due to their relatively short periods to maturity.
The Company uses certain derivative financial instruments which are measured at fair value through profit and
loss (“FVTPL”). These may include interest rate swaps to manage its interest rate risk, forward contracts to
manage its foreign exchange risk on foreign currency payments and TRS derivative contracts for the purpose of
managing its exposure to changes in the fair value of its share-based compensation programs due to changes in
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
74
the Company’s share price. The Company does not designate any of its current derivative contracts as hedges.
The Company does not hold or use any derivative instruments for trading or speculative purposes.
The Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk
management framework and reviews corporate policies on an ongoing basis. The financial instruments that Bird
uses, or may use from time to time, expose the Company to credit, liquidity, market and currency risks. Refer to
Note 31 to the December 31, 2023 consolidated financial statements for further details.
Credit Risk
The Company is primarily exposed to credit risk through accounts receivable. Before entering into any
construction contract and during the course of the construction project, the Company satisfies itself that the
customer has adequate resources to fulfil its contractual payment obligations as construction work is completed.
If a customer is unable or unwilling to pay an amount owing, the Company generally has a right to register a lien
against the project that will normally provide some security that the amount owed would be realized.
At December 31, 2023, accounts receivable outstanding for greater than 90 days and considered past due by the
Company’s management represent 12.7% (December 31, 2022 – 16.6%) of the balance of progress billings on
construction contracts receivable. Management has recorded an allowance of $0.3 million (December 31, 2022 -
$1.6 million) against these past due receivables, net of amounts recoverable from others.
A significant customer is one that represents 10% or more of contract revenue earned during the year. For the
years ended December 31, 2023 and 2022, no customer accounted for 10% or more of the contract revenue.
Although large projects may occasionally result in individual customers being significant, credit risk is mitigated
through regular progress billings and other contract security.
Liquidity Risk
Liquidity risk relates to the risk that the Company will not be able to meet its financial obligations as they become
due. The Company manages this risk through management of its capital structure, monitoring and reviewing
actual and forecasted cash flows and the effect on bank covenants, and maintaining unused credit facilities where
possible to ensure there are available cash resources to meet the Company’s liquidity needs. In managing
liquidity risk, the Company has access to committed short and long-term debt facilities as well as equity markets,
the availability of which is dependent on market conditions. See the section titled "Financial Condition, Capital
Resources and Liquidity" for further information on the Company's financial condition, capital resources and
liquidity.
Market Risk
Market risk is the risk that changes in market prices, such as interest rates, equity prices and corporate bond
yields, will affect the Company’s income or the value of its holdings in liquid securities.
The Company is exposed to interest rate risk to the extent that its credit facilities are based on variable rates of
interest. At December 31, 2023, a one percent change in the interest rate applied to the Company's variable rate
long-term debt would change annual income before income taxes by approximately $0.7 million (2022 – $0.7
million).
The Company has certain share-based compensation plans where the values are based on the common share
price of the Company. At December 31, 2023, a 10 percent change in the share price applied to the Company's
share based compensation plans would change income before income taxes by approximately $3.3 million (2022
– $1.4 million).
The Company has fixed a portion of the settlement costs of these plans by entering into a TRS derivative contract
maturing in 2024. At December 31, 2023, a 10 percent change in the share price applied to the Company's TRS
derivative would change income before income taxes by approximately $3.0 million (2022 – $1.6 million), largely
offsetting the impact on the share-based compensation plans above caused by changes to market price of the
Company's common shares.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
75
Currency Risk
Currency risk is the risk that fluctuations in currency exchange rates will affect the Company’s net income.
The Company uses foreign currency to settle payments to certain vendors and subcontractors. At December 31,
2023, a 10% movement in the Canadian and U.S. dollar exchange rate would have changed income before
income taxes by approximately $0.1 million (2022 – $0.2 million).
DIVIDENDS
The Company declared monthly eligible dividends on common shares payable on or about the 20th of the month
following the month in which the dividend was declared. The following table outlines Bird’s dividend history:
Dividend Period
January 1 to March 31
April 1 to June 30
July 1 to September 30
October 1 to December 31
$
$
$
$
2023
0.1008 $
0.1074 $
0.1074 $
0.1074 $
2022
0.0975
0.0975
0.0975
0.0975
As of March 5, 2024, the Board of Directors has declared eligible dividends with a record date subsequent to
December 31, 2023, for the following months:
Eligible dividends declared
January dividend
Record date
January 31, 2024
Payment date
February 20, 2024
Dividend per share
0.0358
$
February dividend
March dividend
April dividend
February 29, 2024
March 20, 2024
March 28, 2024
April 30, 2024
April 19, 2024
May 17, 2024
$
$
$
0.0358
0.0467
0.0467
OUTSTANDING COMMON SHARE DATA AND STOCK EXCHANGE LISTING
The Company is authorized to issue an unlimited number of common shares. The Company had a total of
53,891,909 common shares outstanding at March 5, 2024 (December 31, 2023 - 53,774,639). The Company’s
common shares are listed on the Toronto Stock Exchange (“TSX”) under the trading symbol BDT.
OFF BALANCE SHEET ARRANGEMENTS
The Company has surety lien bonds issued on behalf of the Company valued at $98.3 million at December 31,
2023 (December 31, 2022 - $87.8 million).
The Company has recognized assets and liabilities for all leases with a term of more than twelve months,
excluding low-value assets, in accordance with IFRS 16 Leases.
Further details of commitments and contingencies are included in Note 33 to the December 31, 2023
consolidated financial statements.
RELATED PARTY TRANSACTIONS
The Company’s related parties, as defined by IFRS, are its joint arrangements and key management personnel. A
description of any material transactions with these related parties is included in Note 34 to the December 31,
2023 consolidated financial statements.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
76
SUMMARY OF QUARTERLY RESULTS
(in thousands of Canadian dollars, except per share amounts)
2022
2023
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Revenue
Net income
$ 475,521 $ 576,688 $ 668,156 $ 648,967 $ 536,459 $ 686,415 $ 783,843 $ 792,068
6,361
14,104
14,466
14,932
5,149
13,714
28,795 23,881
Earnings per share
0.12
0.26
0.27
0.28
0.10
0.26
0.54
0.44
Adjusted Earnings(1)
6,546
8,491
15,502
15,485
5,272
15,680
28,983 24,295
Adjusted Earnings Per Share
0.12
0.16
0.29
0.29
0.10
0.29
0.54
0.45
Adjusted EBITDA(1)
17,835
21,508
31,203
30,639
16,082
29,457
49,342 43,868
(1) Adjusted Earnings and Adjusted EBITDA are non-GAAP financial measures. See "Terminology and Non-GAAP & Other Financial
Measures."
The Company experiences more seasonality in its business in the first quarter and early second quarter as a result
of the nature of its work program for mining clients and the timing of new project starts in its industrial work
program. Contracts for industrial and institutional work typically extend over several quarters and often over
several years. In addition, seasonal activity often increases in both the spring and fall for the Company’s MRO
services, related to plant turnarounds that are typically completed in this timeframe. In the the fourth quarter of
2023, favourable winter weather conditions allowed additional progress to be achieved on multiple projects
across the Company's work programs, resulting in higher work volumes being executed than in the third quarter
of the year, which is typically the highest revenue quarter.
For the purpose of quarterly financial reporting, the Company must estimate the cost required to complete each
contract to assess the overall profitability of the contract and the amount of gross profit to recognize for the
quarter. For certain types of projects, such estimating includes contingencies to allow for certain known and
unknown risks, with the magnitude of contingencies depending on the nature and complexity of the remaining
work to be performed. As a contract progresses and remaining costs to be incurred and risk exposures become
more certain, contingencies will typically decline or have been utilized, although certain risks may remain until the
contract has been completed, or even beyond.
In some cases, variations in earnings may occur where costs incurred to date may be recoverable from insurance
policies or claims to customers at a future date but cannot be recorded in the current quarter. In the case of
insurance claims, financial recovery is not recorded until certainty of the recovery is attained. In the case of claims
against customers that are considered constrained variable consideration, revenue is not recorded until it is highly
probable that there will not be a significant reversal of cumulative revenue to date. As a result, earnings may
fluctuate significantly from quarter-to-quarter, depending on whether contracts with these types of claims are
completed or nearing completion during the quarter, or have been completed in a prior quarter, and may
fluctuate based on timing of resolution of claims.
There are also several other factors that can affect the Company’s revenues and profit from quarter to quarter.
These include the timing of contract awards, the value of subcontractor billings and project scheduling. Generally,
management does not believe that any individual factor is responsible for changes in revenue from quarter-to-
quarter, except for seasonality in the first quarter and early second quarter of each year, and significant
acquisitions. In the fourth quarter of 2023, however, higher share-based compensation costs were experienced
related to performance share units included in the Company's long term incentive plan due to a large increase in
total shareholder return.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
77
ACCOUNTING POLICIES
The Company’s material accounting policies are outlined in the notes to the annual consolidated financial
statements for the year ended December 31, 2023.
New Accounting Standards, Amendments and Interpretations Adopted
The Company has adopted new amendments effective January 1, 2023 related to amendments to IAS 1
Disclosure of Accounting Policies, IAS 8 Definition of Accounting Estimates and IAS 12 Income Taxes that did not
have a material impact on the Company’s financial statements.
Future Accounting Changes
There are new accounting standards and amendments to accounting standards and interpretations that are
effective for annual periods beginning on or after January 1, 2024 that have not been applied in preparing the
financial statements for the period ended December 31, 2023. These standards and interpretations are not
expected to have a material impact on the Company’s financial statements.
CRITICAL ACCOUNTING ESTIMATES & JUDGEMENTS
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of revenues, expenses,
assets, liabilities and the disclosure of contingent assets and liabilities at the reporting date.
Uncertainty about these assumptions and estimates could result in a material adjustment to the carrying amount
of an asset or liability and/or the reported amount of revenue and expense in future periods. Estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in
the period in which the estimates are revised and in any future periods affected.
Assets and liabilities acquired in a business combination
The Company assesses whether an acquisition transaction should be accounted for as an asset acquisition or a
business combination under IFRS 3 Business Combinations. The purchase price related to a business combination
is allocated to the underlying acquired assets and liabilities based on estimates of their fair value at the time of
acquisition. The determination of fair value requires the Company to make assumptions, estimates and
judgements regarding future cash flows, valuation techniques, economic risk, weighted average cost of capital
and future events. The measurement of purchase consideration and allocation process are therefore inherently
subjective and impact the amounts assigned to identifiable assets and liabilities. As a result, the purchase price
allocation impacts the Company’s reported assets and liabilities (including the amounts allocated to intangible
assets and goodwill), and future earnings due to the associated depreciation and amortization expense along
with the required impairment testing.
Revenue and gross profit recognition
Construction revenue, construction costs, contract liabilities, and contract assets are based on estimates and
judgements used in determining contract revenue and the determination of estimated costs to complete in order
to calculate the stage of completion for a particular construction project, depending upon the nature of the
construction contract, as more fully described in the revenue recognition policy. To determine the estimated
costs to complete construction contracts, assumptions and estimates are required to evaluate matters related to
schedule, material and labour costs, labour productivity, changes in contract scope and subcontractor costs. Due
to the nature of construction activities, estimates can change significantly from one accounting period to the next.
The value of many construction contracts increases over the duration of the construction period. Change orders
may be issued by customers to modify the original contract scope of work or conditions. In addition, there may be
disputes or claims regarding additional amounts owing as a result of changes in contract scope, delays, additional
work or changed conditions. Construction work related to a change order or claim may proceed, and costs may
be incurred, in advance of final determination of the value of the change order. Change orders and claims may
not be settled until the construction project is complete or subsequent to completion, and the nature of the
relationship with the other party to the claim and the history of success of these claims may impact the associated
revenue or cost recovery. Claims against customers for variable consideration due to factors described above are
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
78
assessed under the Company’s revenue policy, which requires significant judgement. The amount of variable
consideration that is constrained is the difference between the total claim value and the best estimate of
recovery. This constrained value is reviewed each reporting period.
Provisions
Legal, warranty and other provisions involve the use of estimates. Estimates and assumptions are required to
determine when to record, and how to measure, a provision in the financial statements. The outcomes may differ
significantly from the estimates used in preparing the financial statements resulting in adjustments to previously
reported financial results.
Impairment of non-financial assets
Management evaluates property and equipment, intangible assets with definite lives, and right-of-use (“ROU”)
assets at the end of each reporting period to determine if there are events or circumstances which indicate that
the carrying value may not be recoverable. Goodwill and intangible assets with indefinite lives are tested for
impairment annually, or more frequently if events or changes in circumstances indicate that the asset may be
impaired. Impairment testing is performed by comparing the recoverable amount of the cash-generating unit
("CGU") or groups of CGUs to its carrying amount. There is a significant amount of uncertainty with respect to the
estimate of the recoverable amount given the necessity of making economic projections which employ the
following key assumptions: future cash flows, growth opportunities, including economic risk assumptions, and
estimates of achieving key operating metrics and drivers, and the discount rate. Refer to note 17 to the
December 31, 2023 annual consolidated financial statements for further details regarding the assumptions and
estimates regarding the Company’s goodwill impairment assessment.
Measurement of pension obligations
The Company’s obligations and expenses related to defined benefit (“DB”) pension plans are determined using
actuarial valuations and are dependent on a number of significant assumptions. The DB obligations and benefit
cost levels will change as a result of future changes in actuarial methods and assumptions, membership data, plan
provisions, legislative rules, and future experience gains or losses. Actual experience that differs from
assumptions may result in gains or losses that will be disclosed in future accounting valuations. Refer to note 23 to
the December 31, 2023 annual consolidated financial statements for further details regarding the Company’s DB
pension plans.
Share-based payments
Compensation expense accrued for performance share units (“PSU”) is dependent upon the final number of PSU
awards that will eventually vest, adjusted for a performance multiplier, that is estimated by management and
approved by the Board of Directors. Large fluctuations in compensation expense may occur due to changes in
the underlying share price or revised management estimates of relevant performance factors.
Leases
The Company applies judgement in reviewing each of its contractual arrangements to determine whether the
arrangement contains a lease within the scope of IFRS 16 Leases. Leases that are recognized are subject to
further management judgement and estimation in various areas specific to the arrangement, including the term
of the lease. In determining the lease term to be recognized, management considers all facts and circumstances
that create an economic incentive to exercise an extension option, or not to exercise a termination option.
Where a lease does not specify an interest rate, lease liabilities are estimated using a discount rate equal to the
Company-specific incremental borrowing rate. This rate represents the rate that the Company would incur to
obtain the funds necessary to purchase an asset of a similar value, with similar payment terms and security in a
similar economic environment.
Income taxes
Tax regulations and legislation are subject to change and there are differing interpretations requiring
management judgement. Deferred tax assets are recognized when it is considered probable that deductible
temporary differences will be recovered in future periods, which requires management judgement. Deferred tax
liabilities are recognized when it is considered probable that temporary differences will be payable to tax
authorities in future periods, which requires management judgement. Income tax filings are subject to audits and
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re-assessments and changes in facts, circumstances and interpretations of tax laws may result in a material
increase or decrease in the Company’s provision for income taxes.
CONTROLS AND PROCEDURES
As permitted by NI 52-109, Certification of Disclosures in Issuers’ Annual and Interim Filings, Bird may limit its
design of Disclosure Controls and Procedures or Internal Controls over Financial Reporting to exclude controls,
policies and procedures of a business that was acquired not more than 365 days before the end of the financial
period.
The controls and procedures set out below do not include controls, policies, and procedures for Trinity, acquired
on February 1, 2023.
Disclosure Controls and Procedures
Disclosure controls and procedures are designed to provide reasonable assurance that all material information is
gathered and reported to senior management, including the President and Chief Executive Officer (“CEO”) and
Chief Financial Officer (“CFO”), particularly during the period in which the annual filings are being prepared, and
information required to be disclosed in the Company's annual filings, interim filings or other reports filed or
submitted by it under securities legislation has been recorded, processed, summarized and reported within the
time periods specified in the securities legislation.
An evaluation of the effectiveness of the design of the Company’s disclosure controls and procedures was carried
out under the supervision of management, including the CEO and CFO, with oversight by the Board of Directors
and Audit Committee, as at December 31, 2023. Based on this evaluation, the Company’s CEO and CFO have
concluded that the design of the Company’s disclosure controls and procedures, as defined in NI 52-109, was
effective as at December 31, 2023.
Internal Controls over Financial Reporting
Internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with IFRS.
Absolute assurance cannot be provided that all misstatements have been detected because of inherent
limitations in all control systems. The Company’s management is responsible for designing and maintaining
adequate internal control over financial reporting for the Company.
An evaluation of the effectiveness of the design of the Company’s internal controls over financial reporting was
carried out under the supervision of management, including the CEO and CFO, with oversight by the Board of
Directors and Audit Committee, as at December 31, 2023, using the control framework issued by the Committee
of Sponsoring Organizations of the Treadway Commission on Internal Control - Integrated Framework (2013).
Based on this evaluation, the Company’s CEO and CFO have concluded that the design and operation of the
Company’s internal controls over financial reporting, as defined in NI 52-109, was effective as at December 31,
2023.
There have been no material changes in the Company’s internal controls over financial reporting during the
period beginning on October 1, 2023 and ending on December 31, 2023, that materially affected, or are
reasonably likely to materially affect, the Company’s internal controls over financial reporting.
RISKS RELATING TO THE BUSINESS
The following are the significant risk factors relating to the business. Readers are also encouraged to review the
“Forward-Looking Information” section of this MD&A.
Ability to Hire and Retain Qualified and Capable Personnel
The success of Bird is highly influenced by the efforts of key management, technical, project and business
development personnel. The loss of the services of any of Bird’s key management personnel could negatively
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impact Bird. The future success of Bird also depends heavily on its ability to attract, retain and develop high-
performing personnel in all areas of its operations.
Most firms throughout the construction industry face this challenge and, accordingly, competition for professional
staff is intense. If Bird ceases to be seen by current and prospective employees as an attractive place to work, it
could experience difficulty in hiring and retaining an adequate level of qualified staff. This could have an adverse
effect on current operations of Bird and would limit its prospects and impair its future success.
Maintaining Safe Work Sites
Despite the Company’s efforts to minimize the risk of safety incidents, they can occur from time to time and, if
and when they do, the impact on Bird can be significant. Bird’s success as a construction company is highly
dependent on its ability to keep its construction work sites and offices safe and any failure to do so can have
serious impact on the personal safety of its employees and others. In addition, it can expose Bird to contract
termination, fines, regulatory sanctions or even criminal prosecution.
Bird’s safety record and worksite safety practices also have a direct bearing on its ability to secure work,
particularly in the industrial sector. Certain clients will not engage particular contractors to perform work if their
safety practices do not conform to predetermined standards or if the general contractor has an unacceptably high
incidence of safety infractions or incidents.
Bird adheres to very rigorous health and safety systems and programs which are continually reinforced and
monitored on its work sites and offices. Management is not aware of any pending health and safety legislation or
prior incidents which would be likely to have a material impact on any of Bird’s operations, capital expenditure
requirements, or competitive position. Nevertheless, there can be no guarantee with respect to the impact of
future legislation or incidents.
Economy and Cyclicality
Activity within the construction industry is generally tied to the state of the economy. Thus, in periods of strong
economic growth, capital spending will generally increase and there will be more and higher quality opportunities
available within the construction industry. Investment decisions by our clients are based on long-term views of the
economic viability of their current and future projects, sometimes based upon the clients’ view of the long-term
prices of commodities which are influenced by many factors. If our clients’ outlook for their current and future
projects is not favourable, this may lead them to delay, reduce or cancel capital project spending and may make
them more sensitive to construction costs. A prolonged downturn in the economy could impact Bird’s ability to
generate new business or maintain a backlog of contracts with acceptable margins to sustain Bird through such
downturns.
Bird attempts to insulate itself in various ways from the effects of negative economic conditions through
diversification of the sources of the Company’s earnings; however, there is no assurance that these methods will
be effective in insulating Bird from a downturn in the economy. Furthermore, as a result of increased demand in
certain regions or industry sectors, the Company has, in the past, earned favourable margins on particular
projects. There is also no assurance that above-average margins that may have been generated on historical
contracts can be generated in the future.
Ability to Secure Work
Bird generally secures new contracts either through a competitive bid process or through negotiation. With the
Company's focus on collaborative contracting, many awards in both the public and private sectors are
qualifications based, although price may still be an important factor in clients' procurement decisions.
Qualifications may include factors such as the level of services offered, safety record, construction schedule,
design (if applicable), project personnel, the composition of a consortium, joint venture and subcontractor team,
prior experience with the prospective client and/or the type of project, and financial strength including the ability
to provide bonds and other contract security.
In order to be afforded an opportunity to bid for large projects, a strong balance sheet measured in terms of an
adequate level of working capital, liquidity and equity is typically required.
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A decline in demand for Bird’s services from the private sector could have an adverse impact on the Company if
that business could not be replaced within the public sector. A portion of Bird’s construction activity relates to
government-funded institutional projects. Any reduction in demand for Bird’s services by the public sector,
whether as a result of funding constraints, changing political priorities or delays in projects caused by elections or
other factors, could have an adverse impact on the Company if that business could not be replaced within the
private sector.
Performance of Subcontractors
Successful completion of a contract by Bird depends, in large part, on the satisfactory performance and
availability of any subcontractors who are engaged to complete the various components of the work.
Subcontractor defaults tend to increase during downturns in overall market conditions. If subcontractors fail to
satisfactorily perform their portion of the work, Bird may be required to engage alternate subcontractors to
complete the work and may incur additional costs. This can result in reduced profits or, in some cases, significant
losses on the contract and possible damage to Bird’s reputation.
In addition, the ability of Bird to bid for and successfully complete projects is, in part, dependent on the
availability of qualified subcontractors and trades people. Depending on the value of a subcontractor’s work, Bird
may require some form of performance security and achieves this through the use of surety bonds, subcontractor
default insurance or other forms of security from the subcontractor to mitigate Bird’s exposure to the risks
associated with the subcontractor’s performance and completion. A significant shortage of qualified
subcontractors and trades people or the bankruptcy of a subcontractor could have a material impact on Bird’s
financial condition and results of operations.
Accuracy of Cost to Complete Estimates
As Bird performs each construction contract, costs are continuously monitored against the original cost estimates.
On at least a quarterly basis, a detailed estimate of the costs to complete a contract is compiled by the Company.
These estimates are an integral part of Bird’s process for determining construction revenues and profits, and
depend on cost data collected over the duration of the project as well as estimates and judgements of Bird’s field
and office personnel. Bird has adopted numerous internal control activities aimed at mitigating exposure to this
risk, however to the extent that the costs to complete estimates are based on inaccurate or incomplete
information, or on faulty judgements, the accuracy of reported construction revenues and profits could be
impacted.
Estimating Costs and Schedules/Assessing Contract Risks
The price for most contracts performed by Bird is based, in part, on cost and schedule estimates that are subject
to a number of assumptions, including assumptions as to inflationary impacts. Erroneous assumptions could result
in an incorrect assessment of risks associated with a contract or estimates of project costs and schedules that are
in error, potentially resulting in lower than anticipated profit or significant loss. All significant cost and schedule
estimates are reviewed by senior management prior to tender submission to help mitigate these risks.
Adjustments and Cancellations of Backlog
The future performance of the Company depends significantly on the contribution from projects in its Backlog.
There can be no assurance that the revenues or profits included in Backlog at any point in time will be realized.
Contract suspensions, reductions and cancellations, which are beyond the control of Bird, do occur from time-to-
time in the construction industry. Customers may have the right to suspend, cancel or reduce the scope of their
contracts with Bird and, though Bird generally has a contractual right to be reimbursed for certain costs, it
typically has no contractual rights to the total revenue or profit that was expected to be derived from such
projects. These reductions could have a material adverse impact on future revenues and profitability.
Global Pandemics
Global pandemics, such as the recent COVID-19 pandemic, can result in widespread illnesses and deaths, can
impact the health of the Company’s workforce and can prevent the Company from being able to carry on its
operations whether due to direct impacts, or indirect impacts through its customers and suppliers. These impacts
can severely limit the Company’s ability to operate and to generate revenues or cash flows, while its ability to
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eliminate or reduce costs during such times may be limited. Accordingly, with any threat of a pandemic or similar
public health emergency, the Company could suffer significant financial losses and a deterioration in its
creditworthiness and therefore have a material adverse effect on the Company.
Joint Arrangement Risk
Bird sometimes forms joint arrangements to pursue and execute projects. A joint arrangement structure can be
beneficial by permitting competitive advantages, pooling of resources required to complete a project and risk
sharing between the joint arrangement partners. The joint arrangements in which Bird participates are typically
formed to undertake a specific project, are jointly controlled by the partners and are dissolved upon completion
of the project.
The agreements which govern these joint arrangements typically require that the partners supply their
proportionate share of operating funds and staff and that they share profits and losses in accordance with
specified percentages. Bird selects its joint arrangement partners based on a variety of criteria, including relevant
expertise, past working relationships as well as analysis of the prospective partners’ financial and construction
capabilities.
Each joint arrangement party is typically liable for the obligations of the joint arrangement on a joint and several
basis. In the event that any of Bird’s joint arrangement partners fail to perform their obligations due to financial or
other reasons, Bird may be required to provide additional resources to the project and assume responsibilities for
the obligations of its joint arrangement partner(s) including responsibility for financial losses.
Information Systems and Cyber-security Risk
The Company relies on information technology to manage, process, store and transmit electronic information.
Complete, accurate, available and secure information is vital to the Company’s operations and any compromise in
such information could result in improper decision making, inaccurate or delayed operational and/or financial
reporting, delayed resolution to problems, breach of privacy and/or unintended disclosure of confidential
information. Failure in the completeness, accuracy, availability or security of the Company’s information systems,
the risk of system interruption or failure during system upgrades or implementation, or a breach of data security
could adversely affect the Company’s operations and financial results. In addition, cyber-security incidents
relating to the Company’s information technology systems may disrupt operations and impact operating results.
Cyber-security incidents may occur from a range of techniques, from phishing or hacking attacks to sophisticated
malware, hardware or network attacks. While the Company has implemented systems, policies, procedures,
practices, hardware and backups designed to prevent and limit the effect of cyber-security attacks, there can be
no assurance that these measures will be sufficient to prevent, detect or address the attacks in a timely matter, or
at all. A successful cyber-attack may allow unauthorized interception, destruction, use or dissemination of the
Company’s confidential information, which could have a material adverse effect on the business.
The Company maintains a dedicated team of technology and cybersecurity professionals who manage a
comprehensive program to help protect the organization against breaches and other incidents with appropriate
security and operational controls in place, including the monitoring of threats. The Company also has a continual
training and compliance program that all employees must adhere to. The Company’s risk management activities
also include ensuring sufficient information security insurance coverage is in place, and the regular engagement
of third-party expertise to assess our information security systems.
Litigation/Potential Litigation
In the normal course of the construction business, disputes sometimes arise between parties to construction
contracts. While Bird attempts to resolve any disagreements or disputes before they escalate to litigation, in
some situations this is not possible. At any given time, Bird may be involved in a number of disputes that could
lead to litigation and there may be a number of disputes in various stages of litigation.
The Company makes provisions in its consolidated financial statements for any potential settlements relating to
such matters and management does not believe that any existing litigation or pending litigation will ultimately
result in a final judgment against Bird that would have a materially adverse impact on the operations of Bird.
Litigation is, however, inherently uncertain and, accordingly, adverse outcomes not currently provided for in any
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current litigation or pending litigation are possible. These potentially adverse outcomes could include financial
loss, damage to Bird’s reputation or a reduction in prospects for future contract awards.
Work Stoppages, Strikes and Lockouts
Bird is signatory to a number of collective bargaining agreements. Future negotiation of these collective
bargaining agreements could increase Bird’s operating expenses and reduce profits as a result of increased
wages and benefits. Failure to come to an agreement in these collective bargaining negotiations or those of its
subcontractors and suppliers or government agencies could result in strikes, work stoppages, lockouts or other
work action, and increased costs resulting from delays on construction projects. A strike or other work stoppage
may be disruptive to Bird’s operations and could adversely affect portions of its business, financial position,
results of operations and cash flows.
Acquisition and Integration Risk
The Company has made acquisitions, and may continue to pursue acquisition opportunities to advance its
strategic plan. The successful integration of an acquired business typically requires the management of the pre-
transaction business strategy, including the retention and addition of customers, realization of identified cost,
revenue and strategic synergies, retention of key staff and the development of a common corporate culture.
Failure to adequately address differences in technology, culture, customers, projects, or other issues could
negatively affect financial performance. There is no assurance that the Company will be able to successfully
integrate an acquired business in order to maximize or realize the benefits associated with an acquisition.
Competitive Factors
Bird competes with many international, national, regional and local construction firms. Competitors may benefit
from advantages in a particular market that Bird does not have, may have greater access to resources, or may
have more experience or a better relationship with a particular client. On any given contract bid or negotiation,
Bird assesses the level of real or perceived competitive advantage that its competitors have. Depending on this
assessment, Bird will decide whether or not to pursue a contract, or may take other action to counteract such
advantage when pursuing the work, such as adjusting the level of profit can be incorporated into its contract price
and which personnel should be assigned to the contract. The accuracy of this assessment and the ability of Bird to
respond to competitive factors affect Bird’s success in securing new contracts and its profitability on contracts
that it does secure.
Potential for Non-Payment
Before signing any construction contract, Bird conducts due diligence to satisfy itself that the potential client has
adequate resources to make payments under the terms of the contract. Throughout the contract, Bird also
attempts to ensure that payments are collected from clients before Bird’s payments to subcontractors and
suppliers for that contract fall due. However, because of the nature of Bird’s contracts and occasionally because
of delays in receiving customer payments, Bird may be required to utilize its working capital to temporarily fund
construction costs where payment from its clients is delayed.
If a customer defaults in meeting its payment obligations to Bird on a project, Bird would generally have the right
to register a lien against the project. If the customer was unable or unwilling to pay the amount owing to Bird, a
lien against the property will normally provide some security that Bird may collect the amounts owing to it
through the enforcement of its lien. However, in these situations, Bird’s ability to collect the outstanding
payments is never assured. Payment default by a client could result in a financial loss to Bird that could have a
material effect on Bird’s operating results and financial position.
Climate Change Risks and Opportunities
Transition to a Lower Carbon Economy
The transition to a lower-carbon economy could potentially be disruptive to traditional business models and
investment strategies. Private and/or public-sector clients of the Company may choose to change their
construction project priorities due to changes in project funding or public perception of the sustainability of the
projects. Changing market demands are actively monitored by the Company, partially mitigating this risk as lower
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demand in some sectors may be offset with opportunities in others, by forming strategic partnerships and by
pursuing sustainable innovations.
Government action to address climate change may include economic instruments such as carbon and energy
consumption taxes as well as restrictions on economic sectors, such as cap-and-trade or more stringent
regulation of greenhouse gas emissions and biodiversity protections that could also impact the Company’s
current or potential clients operating in industries that extract, distribute and transport fossil fuels, or clients in
other carbon intensive industries.
The transition to a lower-carbon economy also presents opportunities as changing market demands are aligned
to the Company’s diversified service offerings and operations in varied market sectors. Strategic acquisitions
including Stuart Olson, Dagmar, Trinity and NorCan have enhanced the Company’s ability to secure and execute
projects of increased scale and complexity. The Company is positioned to capture growth in key sectors including
infrastructure, utilities, deep energy retrofits, nuclear and renewable energy, particularly for projects related to
expanding electrification and decarbonization.
Financial
The Company’s cost of business, including insurance premiums, may increase due to the introduction of or
changes to climate change measures. The Company may also incur additional expenses related to complying
with environmental regulations and policies in regions where it does business. These costs could include
requirements to purchase new equipment to reduce emissions to comply with new regulatory standards or to
mitigate the financial impact of different forms of carbon pricing. The Company could also incur costs related to
engaging with governments, regulators and industry organizations in order to proactively monitor regulatory
trends, and costs to implement appropriate compliance processes. Although the Company actively monitors
applicable climate change laws and regulations and compliance with them, and is proactive in promoting and
supporting climate change mitigation actions, inadvertent compliance shortfalls could result in penalties and
reputational damage that may impair the Company's future prospects.
Market and Reputational
Investors and other stakeholders in Canada and worldwide are becoming more attuned to climate change action
and sustainability matters, including the efforts made by issuers to reduce their carbon footprint and demonstrate
due diligence within their value chain. The Company’s reputation may be harmed if it is not perceived by its
stakeholders to be sincere in its sustainability commitment and its long-term results could be impacted as a
result. In addition, the Company’s approach to climate change issues may influence stakeholders’ and clients'
perceptions of the Company in relation to its peers and impact their investment and procurement decisions.
Weather Related
The probability and unpredictability of extreme weather events such as hurricanes, tornadoes, wildfires, floods,
droughts and other associated incidents, such as earthquakes, may continue to increase due to climate change,
and there may continue to be longer-term shifts in climate patterns. As many of the Company's construction
activities are performed outdoors, extreme weather events can be disruptive to operations and cause the
Company to incur additional costs such as late completion penalties imposed by the contract, the incremental
costs arising from loss of productivity, compressed schedules, overtime work utilized to offset the time lost due to
adverse weather, or additional costs to modify methods to perform work under unanticipated weather conditions.
Although the Company mitigates some of these risks through contractual terms and insurance, extended periods
of poor weather may have an adverse effect on profitability.
Conversely, the impact of extreme weather events on the built environment, and infrastructure in particular,
creates increased demand for the construction of climate-resilient infrastructure and the post-construction
hardening of existing infrastructure. The Company’s expanding capabilities to bid on and execute these types of
projects creates profitable growth opportunities for the Company.
Access to Capital
The Company requires working capital to support its ongoing and future work program. Bird relies on its cash
position and the availability of credit and capital markets to meet these working capital demands. As the
Company’s businesses grow, the Company is continually seeking to enhance its access to funding in order to
finance the higher working capital requirements associated with this growth. Further, instability or disruption of
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capital markets, or a weakening of the Company’s cash position could restrict its access to, or increase the cost of
obtaining, financing. Additionally, if the terms of the credit facility are not met, lenders may terminate the
Company’s right to use its credit facility, or may demand repayment in whole or in part of the Company’s
outstanding indebtedness, which could have a material adverse effect on the Company’s financial position.
One or more third parties drawing on letters of credit or guarantees could have a material adverse effect on Bird’s
cash position and operations.
Some of Bird’s clients also depend on the availability of credit to finance their projects. If clients cannot arrange
financing, projects may be delayed or cancelled, which could have a material adverse effect on the Company’s
growth and financial position. Diminution of a client’s access to credit may also affect the Company’s ability to
collect payments, negotiate change orders, and settle claims with clients which could have a material adverse
effect on the Company’s financial position.
Quality Assurance and Quality Control
Bird enters into contracts which specify the scope and specifications of the project to be designed and/or
constructed, including quality standards. If all, or portions of the work fail to meet these standards, Bird could be
exposed to additional costs for the correction of non-compliant work.
Design Risks
While many contracts entered into by Bird are for construction or construction services only, certain contracts are
undertaken on a design-build basis, under which Bird is responsible for both design and construction of the
project, which adds design risk assumed by Bird. While Bird subcontracts all of the design scope in such design-
build contracts to reputable designers, there is generally not a full transfer of design-related risks. These risks
include design development and potential resulting scope extensions not anticipated at the outset of the project,
delays in the design process that may adversely affect the overall project schedule, and design errors and
omissions.
To manage these risks, Bird manages and oversees the design process, coordinates the design deliverables with
the construction process and, for significant design-build projects, purchases errors and omissions insurance.
Insurance Risk
In the normal course of business, Bird maintains insurance in order to satisfy the requirements of its construction
contracts at a minimum, and to insure project and business risks as part of its corporate risk management policies,
including risks relating to its assets. Bird places enterprise and project coverages consistent with a construction
contractor of its size, complexity and breadth of operations. As a matter of business and risk assessment, Bird
assesses its insurance programs routinely to ensure sufficiency of limits, breadth of coverage, and competitive
pricing, all against the backdrop of a tightening insurance marketplace and restricting coverage and limits.
Although Bird believes it maintains appropriate insurance coverage with sufficient limits, there can be no
assurance that the Company’s project-specific and corporate insurance arrangements will be sufficient to cover
claims incurred. In addition, there can be no assurance that the Company’s insurers and independent third-party
insurers will interpret insurance policies and evaluate and adjust claims in the Company’s favour in the first
instance in all cases.
Access to Surety Support and Other Contract Security
On many of its construction contracts, Bird is required to provide surety bonds. Bird’s ability to obtain surety
bonds depends primarily upon its capitalization, working capital, past performance, capability and continuity of
management, as well as its current level of activity and market conditions. As the value of Bird’s backlog
increases, Bird may be required to maintain higher levels of equity and working capital than it currently maintains
in order to secure surety bonds.
The level of equity and working capital required to maintain ongoing surety support is subject to negotiation and
other factors that cannot be determined precisely. Furthermore, the overall capacity of the surety market and
claims experience of sureties will have an influence on the pricing and availability of bonds. There can be no
assurance that Bird will have access to surety support on favourable or commercially reasonable terms, or at all,
for contracts it would like to pursue. Bird’s agreements with its surety company are on industry standard terms.
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Completion and Performance Guarantees
Under some contracts, failure to meet a project deadline or other schedule milestone may, in addition to any
delay-related expenses incurred by Bird, expose Bird to liquidated damages or other financial penalties that may
include cost impacts to the client resulting from any delay. The Company mitigates its exposure to these risks by
managing and monitoring schedule and completion progress on its projects, as well as by transferring part of the
risks to its subcontractors and suppliers.
Under design-build contracts, the work, or portions thereof, may be required to meet certain performance
specifications and/or other contractually specified needs of the customer. A failure to meet these requirements
could expose Bird to liability for design flaws and/or additional construction costs that may result from such
failures. The Company mitigates its exposure to these risks by subcontracting design services work and by
subscribing for or otherwise obtaining professional liability insurance.
If Bird fails to meet completion schedules or performance or design obligations, the total costs of the project
could exceed original estimates and could result in reduced profitability or a loss to Bird for that project. In
extreme cases, such situations could have a material negative impact on the operating results and financial
position of Bird.
Ethics and Reputational Risk
One of the Company’s competitive advantages rests in its relationships with its customers and its long-standing
reputation as a contractor that delivers high-quality projects and services on time, and in a safe and
environmentally-friendly manner. Damage to the Company’s reputation can result from the occurrence of a
variety of actual or perceived events. Negative publicity can arise from a number of factors including, without
limitation, the quality of service provided, business ethics and integrity, health and safety record and compliance
with laws or regulations.
As part of its business dealings with governmental bodies, Bird must comply with public procurement laws and
regulations aimed at ensuring that public sector bodies award contracts in a transparent, competitive, efficient,
ethical and non-discriminatory manner. Although the Company has adopted control measures and implemented
policies and procedures to mitigate the risk of non-compliance, these control measures, policies and procedures
may not always be sufficient to protect the Company from the consequences of acts prohibited by public
procurement and other laws and regulations committed by its directors, officers, employees and agents. If the
Company fails to comply with these laws and regulations it could be subject to administrative or civil liabilities
and to mandatory or discretionary exclusion or suspension, on a permanent or temporary basis, from contracting
with governmental bodies in addition to other penalties and sanctions that could be incurred by the Company.
Negative opinion concerning any of these factors could potentially have an adverse effect on current operations
and could limit the Company’s prospects and impair its future success. The Company depends on its reputation
as a construction company that abides by the highest ethical standards and has therefore implemented various
policies and procedures to help mitigate this risk, including the adoption of: a comprehensive employee code of
conduct; an anti-bribery and corruption policy; and a whistleblower policy. All employees are required to sign an
acknowledgement of these policies, and to review and abide by them. In addition, the Company provides training
to its employees regarding these policies, which include principles relating to harassment, fairness, conflicts of
interest and other ethical business practices.
Compliance with Environmental Laws
Bird is subject to numerous federal, provincial and municipal environmental laws, and judicial, legislative and
regulatory developments relating to environmental protection occur on an ongoing basis. Bird’s projects can
involve the handling of hazardous and environmentally sensitive materials, which, if improperly handled or
disposed of, could subject Bird to civil and criminal penalties. While Bird strives to keep informed of and to
comply with all applicable environmental laws, circumstances may arise and incidents may occur that are beyond
Bird’s control that could adversely affect Bird. Management is not aware of any pending environmental legislation
or incidents that would be likely to have a materially adverse impact on any of Bird’s operations, capital
expenditure requirements or competitive position, although there can be no assurance that no future legislation
will be enacted or incidents will occur which may have a material impact on Bird’s operations.
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Internal and Disclosure Controls
Bird has designed and implemented a system of internal controls and a variety of policies and procedures to
provide reasonable assurance that material misstatements in the financial reporting and public disclosures are
prevented and detected on a timely basis, and that other business risks are mitigated. In accordance with the
guidelines adopted in Canada, the Company assesses the effectiveness of its internal and disclosure controls
using a top-down, risk-based approach in which both qualitative and quantitative measures are considered. An
internal control system, no matter how well it is planned, implemented and operated, can provide only
reasonable, and not absolute, assurance to management and the Board of Directors regarding achievement of
intended results. In addition, Bird’s current system of internal and disclosure controls places reliance on key
personnel across the Company to perform a variety of control functions including key reviews, analysis,
reconciliations and monitoring. The failure of individuals to perform such functions or properly implement the
controls as designed could adversely impact results.
TERMINOLOGY AND NON-GAAP & OTHER FINANCIAL MEASURES
Terminology
Throughout this report, management uses the following terms that may not be comparable with similar terms
presented by other companies and require definition.
•
“Backlog” is the total value of all contracts awarded to the Company, less the total value of work completed
on these contracts as of the date of the most recently completed quarter. This includes all contracts that have
been awarded to the Company whether the work has commenced or will commence in the normal course. It
includes all the Company’s remaining performance obligations in its contracts with its clients, including work
orders and other formal documents to proceed issued in connection with multi-year recurring revenue
contracts such as MSAs, maintenance, task order, and similar contractual arrangements. It does not include
amounts for variable consideration that are constrained, agency relationship construction management
projects, and estimated future work orders or other formal documents to proceed to be performed as part of
recurring revenue agreements. The Company’s Backlog equates to the Company’s remaining performance
obligations as at December 31, 2023, and December 31, 2022; refer to Note 10 of the December 31, 2023
consolidated financial statements.
•
“Lost Time Incident Frequency” or “LTI Frequency” is the number of lost time incidents recorded per
200,000 person-hours of work by Bird employees.
Non-GAAP and Other Financial Measures
Throughout this MD&A certain measures are used that do not have a standardized meaning prescribed by IFRS
and are considered specified financial measures. These include non-GAAP financial measures, non-GAAP
financial ratios and supplementary financial measures. The Company’s specified financial measures are detailed
below. These measures may not be comparable with similar measures presented by other companies.
Non-GAAP Financial Measures
•
“Adjusted Earnings” is defined as IFRS net income excluding asset impairments, acquisition, integration and
restructuring (as defined in accordance with IFRS) costs and the income tax effect of these costs. Acquisition,
integration and restructuring (as defined in accordance with IFRS) costs are a component of Costs of
construction and General and administrative expenses presented in the statement of income. Management
uses Adjusted Earnings to assess the operating performance of the business. These adjustments are made to
exclude items of an unusual nature that are not reflective of ongoing operations. Management believes that
investors and analysts use these measures, as they may provide predictive value to assess the ongoing
operations of the business and are a more consistent comparison between financial reporting periods.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
88
ADJUSTED EARNINGS
(in thousands of Canadian dollars, except per share amounts)
Three months ended
December 31,
2022
2023
Year ended December 31,
2022
2023
Net income
$
23,881 $
14,932 $
71,539 $
Add: Acquisition and integration costs
Add: Impairment of assets
Deduct: Gain on settlement of trade receivable
Income tax effect of the above items
561
—
—
(147)
728
—
—
(175)
2,132
1,430
—
(871)
49,863
2,487
—
(7,596)
1,270
Adjusted Earnings
Adjusted Earnings Per Share (1)
$
$
24,295 $
15,485 $
74,230 $
46,024
0.45 $
0.29 $
1.38 $
0.86
(1) Calculated as Adjusted Earnings divided by basic weighted average shares.
•
“Adjusted EBITDA” represents earnings before interest, taxes, depreciation and amortization, finance and
other costs, finance and other income, asset impairment charges, gain or loss on sale of property and
equipment, restructuring and severance costs outside of normal course, and acquisition, integration and
restructuring (as defined in accordance with IFRS) costs. Acquisition costs, integration costs, restructuring (as
defined in accordance with IFRS) costs, and other restructuring and severance costs are a component of
Costs of construction and General and administrative expenses presented in the statement of income.
Adjusted EBITDA is a common financial measure used by investors, analysts, and lenders as an indicator of
cash operating performance, as well as a valuation metric, and as a measure of a company’s ability to incur
and service debt. The calculation of Adjusted EBITDA excludes items that do not reflect ongoing cash flows
of the business or continuing operations, including impairment charges, restructuring charges, and
acquisition and integration charges, as management believes that these items should not be reflected in a
metric used for valuation and debt servicing evaluation purposes.
ADJUSTED EBITDA
(in thousands of Canadian dollars, except percentage amounts)
Three months ended
December 31,
2022
2023
Year ended December 31,
2022
2023
Net income
Add: Income tax expense
Add: Depreciation and amortization
Add: Finance and other costs
Less: Finance and other income
Add: Loss (gain) on sale of property and
equipment
Add: Acquisition and integration costs
Add: Impairment of assets
$
23,881
$
14,932
$
71,539
$
7,385
10,404
4,247
(1,206)
(1,404)
561
—
5,459
8,798
2,933
(904)
(1,307)
728
—
21,692
36,137
13,158
(5,216)
(2,123)
2,132
1,430
49,863
17,322
36,439
9,818
(10,341)
(4,403)
2,487
—
Adjusted EBITDA
$
43,868
$
30,639
$
138,749
$
101,185
Adjusted EBITDA Margin (1)
5.5 %
4.7 %
5.0 %
4.3 %
(1) Calculated as Adjusted EBITDA divided by Construction revenue.
Non-GAAP Financial Ratios
•
“Adjusted Earnings Per Share” is calculated by dividing Adjusted Earnings by the basic weighted average
number of shares.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
89
•
“Adjusted EBITDA Margin” is the percentage derived by dividing Adjusted EBITDA by construction
revenue.
Supplementary Financial Measures
•
•
•
•
“Pending Backlog” is the total potential revenue of awarded but not contracted projects including where
the Company has been named preferred proponent, where a contract has not been executed and where the
letter of intent or agreement received is non-binding. It may also include estimated amounts for pre-
construction activities, collaborative contracting arrangements and future work orders to be performed as
part of multi-year MSA, maintenance, task order, and similar contractual arrangements. Management does
not provide any assurance that a contract will be finalized, or revenue recognized in the future.
“Gross Profit Percentage” is the percentage derived by dividing gross profit by construction revenue.
Gross profit is calculated by subtracting construction costs from construction revenue.
“Current ratio” is the percentage derived by dividing total current assets by total current liabilities.
“General and Administrative expenses as a percentage of revenue” is the percentage derived by
dividing general and administrative expenses by construction revenue.
FORWARD-LOOKING INFORMATION
This MD&A contains forward-looking statements and information (“forward-looking statements”) within the
meaning of applicable Canadian securities laws. The forward-looking statements contained in this MD&A are
based on the expectations, estimates and projections of management of Bird as of the date of this MD&A unless
otherwise stated. The use of any of the words “believe”, “expect”, “anticipate”, “contemplate”, “target”, “plan”,
“outlook”, "potential", "estimated", “intends”, “continue”, “may”, “will”, “should” and similar expressions are
intended to identify forward-looking statements. More particularly and without limitation, this MD&A contains
forward-looking statements concerning: anticipated financial performance; the outlook for 2024; expectations for
Adjusted EBITDA Margins in 2024 and beyond; dividend rates, their sustainability, and expected dividend payout
ratios; expectations with respect to anticipated revenue growth and seasonality, growth in earnings, cash flow,
earnings per share and adjusted EBITDA in 2024 and beyond, and margin improvements; the ability of the
Company to further leverage its cost structure; the Company’s ability to capitalize on opportunities and grow
profitably; the robustness of near to medium term demand in core markets; the sufficiency of working capital and
liquidity to support growth and finance future capital expenditures; and with respect to Bird’s ability to convert
Pending Backlog to Backlog and the timing of conversions.
Since forward-looking statements address future events and conditions, by their very nature they involve inherent
risks and uncertainties. Investors are cautioned that forward-looking statements are based on the opinions,
assumptions and estimates of management considered reasonable at the date the statements are made, and
actual results could differ materially from those currently anticipated due to a number of factors and risks. These
include, but are not limited to the risks associated with the industries in which Bird operates in general, such as
those listed under the section "Risks Relating to the Business" in this MD&A.
The forward-looking statements contained in this MD&A are made as of the date hereof and the Company
undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as, and to the extent required by applicable securities laws.
BIRD CONSTRUCTION INC.
MANAGEMENT'S DISCUSSION & ANALYSIS 2023
90
2023
BIRD CONSTRUCTION INC.
Consolidated
Financial
Statements
for the years ended
December 31, 2023 and 2022
Management’s Responsibility for Financial Reporting
The management of Bird Construction Inc. (the “Company”) is responsible for the preparation and integrity
of the accompanying consolidated financial statements. These consolidated financial statements have been
prepared in accordance with IFRS Accounting Standards (“IFRS”) and includes certain estimates that reflect
management’s best judgement.
Management maintains appropriate systems of internal control. Policies and procedures are designed to
provide reasonable assurance that transactions are properly authorized, assets are safeguarded and
financial records are properly maintained to provide reliable information for the preparation of financial
statements.
The Board of Directors has reviewed and approved the consolidated financial statements. The Board fulfills
its responsibility in this regard through its Audit Committee. The Audit Committee is composed entirely of
independent Directors and the members are financially literate. The Audit Committee meets regularly with
management and the external auditors to discuss reporting and control issues and ensures each party is
properly discharging its responsibilities.
The consolidated financial statements have been audited by KPMG LLP, Chartered Professional
Accountants, in accordance with Canadian generally accepted auditing standards on behalf of the
shareholders.
Terrance L. McKibbon Wayne R. Gingrich
President & Chief Executive Officer Chief Financial Officer
March 5, 2024
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
92
KPMG LLP
1900 - 360 Main Street
Winnipeg
R3C 3Z3
Telephone (204) 957-1770
Fax (204) 957-0808
www.kpmg.ca
INDEPENDENT AUDITOR'S REPORT
To the Shareholders of Bird Construction Inc.
Opinion
We have audited the consolidated financial statements of Bird Construction Inc. (the Entity), which comprise the
consolidated statements of financial position as at December 31, 2023 and December 31, 2022, the
consolidated statements of income, comprehensive income, changes in equity and cash flows for the years then
ended, and notes to the financial statements, including a summary of material accounting policy information
(hereinafter referred to as the “financial statements”).
In our opinion, the accompanying financial statements present fairly, in all material respects, the consolidated
financial position of the Entity as at December 31, 2023 and December 31, 2022, and its consolidated financial
performance and its consolidated cash flows for the years then ended in accordance with IFRS Accounting
Standards (“IFRS”) as issued by the International Accounting Standards Board.
Basis for Opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards. Our
responsibilities under those standards are further described in the “Auditor’s Responsibilities for the Audit of
the Financial Statements” section of our auditor’s report.
We are independent of the Entity in accordance with the ethical requirements that are relevant to our audit of
the financial statements in Canada and we have fulfilled our other ethical responsibilities in accordance with
these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matter
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of
the financial statements for the year ended December 31, 2023. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
We have determined the matter described below to be the key audit matter to be communicated in our auditor’s
report.
Estimate of costs to complete and variable consideration to be received for fixed price construction
contracts
Description of the matter
The Entity recognizes revenue from contracts with customers in accordance with the pattern of satisfying the
Entity’s performance obligations under a contract. In fiscal 2023, the Entity recognized $2,798,785 thousand in
construction revenue. Revenue from fixed price contracts, which is a significant portion of construction revenue,
is recognized using the input method with reference to costs incurred. To determine the estimated costs to
complete for fixed price construction contracts, assumptions and estimates are required to evaluate matters
related to schedule, material and labour costs, labour productivity, and changes to contract scope and
subcontractor costs. Change orders may be issued by customers to modify the original contract scope of work
or conditions, and there may be disputes or claims regarding additional amounts owing. Claims against
customers for variable consideration due to delays, scope changes, or other matters are assessed under the
Entity’s revenue recognition policy, which requires significant judgment.
KPMG LLP, an Ontario limited liability partnership and member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private
English company limited by guarantee. KPMG Canada provides services to KPMG LLP.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
93
Why the matter is a key audit matter
We identified the evaluation of the estimate of costs to complete and variable consideration to be received for
fixed price construction contracts as a key audit matter. The evaluation of the estimated costs to complete and
variable consideration to be received for fixed price construction contracts involved significant auditor judgment
to evaluate the results of audit procedures, given the significant judgment applied by management in the
determination of these estimates.
How the matter was addressed in our audit
The primary procedures we performed to address this key audit matter included the following:
We evaluated the design and implementation, and tested the operating effectiveness, of certain internal controls
within the Entity’s revenue recognition process. This included a control related to the review of estimated costs
to complete for construction contracts at year-end.
We evaluated the Entity’s ability to estimate costs to complete and variable consideration by comparing to the
final costs to complete and variable consideration received for contracts completed in fiscal 2023 and estimated
in the prior period.
For a selection of fixed price construction contracts at December 31, 2023, we evaluated the appropriateness of
the Entity’s determination of costs to complete and variable consideration to be received by performing the
following:
•
•
•
•
Agreed estimated costs to complete to appropriate supporting documentation and key contractual terms
back to signed contracts
Performed procedures to compare the estimated total costs to actual costs incurred to date
Inquired with relevant operational Entity personnel to gain an understanding of the status of project
activities and factors impacting the estimate of costs to complete and variable consideration to be
received, and corroborated by agreeing to appropriate supporting documentation
Determined the reasonableness of any variable consideration recognized as revenue on unbilled
change orders or claims by inspecting change orders, directives, or other correspondence with
customers, where applicable; considering the historical outcomes of previously settled claims, and
corresponding with internal and external legal counsel, where applicable.
Other Information
Management is responsible for the other information. Other information comprises:
•
•
the information included in Management’s Discussion and Analysis filed with the relevant Canadian
Securities Commissions.
the information, other than the financial statements and the auditor’s report thereon, included in a
document likely to be entitled “2023 Annual Report”.
Our opinion on the financial statements does not cover the other information and we do not and will not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information
identified above and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit and remain alert for indications that the other
information appears to be materially misstated.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
94
We obtained the information included the Management’s Discussion and Analysis filed with the relevant
Canadian Securities Commissions as at the date of this auditor’s report. If, based on the work we have
performed on this other information, we conclude that there is a material misstatement of this other information,
we are required to report that fact in the auditor’s report.
We have nothing to report in this regard.
The information, other than the financial statements and the auditor’s report thereon, included in a document
likely to be entitled “2023 Annual Report” is expected to be made available to us after the date of this auditor’s
report. If, based on the work we will perform on this other information, we conclude that there is a material
misstatement of this other information, we are required to report that fact to those charged with governance.
Responsibilities of Management and Those Charged with Governance for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance
with IFRS, and for such internal control as management determines is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Entity’s ability to continue
as a going concern, disclosing as applicable, matters related to going concern and using the going concern
basis of accounting unless management either intends to liquidate the Entity or to cease operations, or has no
realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Entity‘s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our
opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with Canadian generally accepted auditing standards will always detect a material misstatement
when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they
could reasonably be expected to influence the economic decisions of users taken on the basis of the financial
statements.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise
professional judgment and maintain professional skepticism throughout the audit.
We also:
•
Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that
is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Entity's internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
95
•
•
•
•
Conclude on the appropriateness of management's use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Entity's ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Entity to cease to continue as a going
concern.
Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in a
manner that achieves fair presentation.
Communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
Provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the group Entity to express an opinion on the financial statements. We are
responsible for the direction, supervision and performance of the group audit. We remain solely
responsible for our audit opinion.
•
Determine, from the matters communicated with those charged with governance, those matters that
were of most significance in the audit of the financial statements of the current period and are therefore
the key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we determine
that a matter should not be communicated in our auditor’s report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Chartered Professional Accountants
The engagement partner on the audit resulting in this auditor’s report is Austin Abas.
Winnipeg, Canada
March 5, 2024
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
96
Bird Construction Inc.
Consolidated Statement of Financial Position
As at December 31, 2023 and December 31, 2022
(in thousands of Canadian dollars)
Note
2023
20221
ASSETS
Current assets
Cash and cash equivalents
Accounts receivable
Contract assets
Inventory and prepaid expenses
Income taxes recoverable
Other assets
Assets held for sale
Total current assets
Non-current assets
Other assets
Investments in equity accounted entities
Property and equipment
Right-of-use assets
Deferred income tax asset
Intangible assets
Goodwill
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Accounts payable
Contract liabilities
Dividends payable to shareholders
Income taxes payable
Current portion of loans and borrowings
Current portion of right-of-use liabilities
Provisions
Other liabilities
Total current liabilities
Non-current liabilities
Loans and borrowings
Right-of-use liabilities
Deferred income tax liability
Other liabilities
Total non-current liabilities
TOTAL LIABILITIES
SHAREHOLDERS' EQUITY
Shareholders' capital
Contributed surplus
Retained earnings
Accumulated other comprehensive income (loss)
Total shareholders' equity
$
$
$
8
9
10
11
12
11
13
14
15
20
16
17
10
18
19
21
22
18
19
20
22
25
177,529 $
850,451
99,562
12,076
5,565
1,210
2,085
1,148,478
3,649
10,479
56,323
74,114
28,935
46,394
55,992
275,886
174,607
705,616
56,938
10,385
13,633
4,236
2,341
967,756
5,539
9,786
55,471
66,136
31,564
34,742
55,740
258,978
1,424,364 $
1,226,734
639,963 $
206,342
1,925
12,496
8,305
20,750
14,690
9,997
914,468
64,621
57,680
40,959
24,142
187,402
1,101,870
115,265
1,956
205,314
(41)
322,494
570,679
146,986
1,745
10,848
7,084
17,790
18,543
9,449
783,124
68,007
55,469
35,756
11,390
170,622
953,746
114,584
1,956
156,537
(89)
272,988
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
1,424,364 $
1,226,734
1 Certain comparative figures in 2022 have been reclassified to conform to the presentation adopted in the current year (note 36).
The accompanying notes are an integral part of these consolidated financial statements.
Approved on behalf of the Board of Directors
Paul R. Raboud
Chairman of the Board
Karyn A. Brooks
Audit Committee Chair
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
97
Bird Construction Inc.
Consolidated Statement of Income
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Construction revenue
Costs of construction
Gross profit
Income (loss) from equity accounted investments
General and administrative expenses
Income from operations
Finance and other income
Finance and other costs
Income before income taxes
Income tax expense
Net income for the period
Basic and diluted earnings per share
Note
2023
20221
10
29
13
29
27
28
20
26
$
2,798,785 $
2,558,249
240,536
3,418
(142,781)
2,369,332
2,167,570
201,762
(2,714)
(132,386)
101,173
66,662
5,216
(13,158)
93,231
21,692
10,341
(9,818)
67,185
17,322
$
$
71,539 $
49,863
1.33 $
0.93
1 Certain comparative figures in 2022 have been reclassified to conform to the presentation adopted in the current year (note 36).
The accompanying notes are an integral part of these consolidated financial statements.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
98
Bird Construction Inc.
Consolidated Statement of Comprehensive Income
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars)
Net income for the period
Other comprehensive income (loss) for the period:
Items that will not be reclassified to net income in subsequent periods:
Defined benefit plan actuarial gain (loss)
Deferred tax recovery (expense)
Items that may be reclassified to net income in subsequent periods:
Foreign currency translation on equity accounted investments
Other foreign currency translation
Deferred tax recovery (expense)
Note
2023
2022
$
71,539 $
49,863
23
20
13
20
(24)
6
(18)
93
(38)
(7)
48
908
(228)
680
(187)
53
32
(102)
50,441
Total comprehensive income for the period
$
71,569 $
The accompanying notes are an integral part of these consolidated financial statements.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
99
Bird Construction Inc.
Consolidated Statement of Changes in Equity
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Note
Shareholders'
capital
Contributed
surplus
Retained
earnings
Accumulated
other
comprehensive
income (loss)
Total
equity
Balance at December 31, 2022
$
114,584 $
1,956 $
156,537 $
(89) $
272,988
Net income for the period
Other comprehensive income (loss) for the period 13,23
Total comprehensive income (loss) for the period
Common shares issued on acquisition of Trinity
7
Dividends declared to shareholders
—
—
—
681
—
681
—
—
—
—
—
—
71,539
(18)
71,521
—
(22,744)
(22,744)
—
48
48
—
—
—
71,539
30
71,569
681
(22,744)
(22,063)
Balance at December 31, 2023
$
115,265 $
1,956 $
205,314 $
(41) $
322,494
Dividends declared per share
$
0.42
Balance at December 31, 2021
$
114,584 $
1,956 $
126,935 $
13 $
243,488
Net income for the period
Other comprehensive income (loss) for the period
Total comprehensive income (loss) for the period
Dividends declared to shareholders
—
—
—
—
—
—
—
—
—
—
49,863
680
50,543
(20,941)
(20,941)
—
(102)
(102)
—
—
49,863
578
50,441
(20,941)
(20,941)
Balance at December 31, 2022
$
114,584 $
1,956 $
156,537 $
(89) $
272,988
Dividends declared per share
$
0.39
The accompanying notes are an integral part of these consolidated financial statements.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
100
Bird Construction Inc.
Consolidated Statement of Cash Flows
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars)
Cash flows from (used in) operating activities
Net income for the period
Items not involving cash:
Amortization
Depreciation
(Gain) loss on sale of property and equipment and other
(Income) loss from equity accounted investments
Finance and other income
Finance and other costs
Deferred compensation plan expense and other
Defined benefit pension plan expense, net of contributions
Unrealized (gain) loss on investments and other
Income tax expense (recovery)
Cash flows from operations before changes in non-cash working capital
Changes in non-cash working capital relating to operating activities
Interest received
Interest paid
Income taxes recovered (paid)
Net cash from (used in) operating activities
Cash flows from (used in) investing activities
Capital distributions from equity accounted entities
Proceeds on sale of investment in equity accounted entities
Additions to property and equipment and intangible assets
Proceeds on sale of property and equipment
Acquisitions, net of cash acquired
Other long-term assets
Net cash from (used in) investing activities
Cash flows from (used in) financing activities
Dividends paid on shares
Net proceeds (repayment) of draws for working capital purposes
Proceeds from loans and borrowings
Repayment of loans and borrowings
Repayment of right-of-use liabilities
Net cash from (used in) financing activities
Net increase (decrease) in cash and cash equivalents during the period
Effects of foreign exchange on cash balances
Cash and cash equivalents, beginning of the period
Note
2023
20221
$
71,539 $
49,863
16
14, 15
13
27
28
23
20
30
12, 13
12, 13
14, 16
7
18
18
18
19
5,998
30,139
(829)
(3,418)
(5,216)
13,158
11,584
(218)
(22)
21,692
144,407
(55,554)
4,185
(12,511)
(4,727)
75,800
666
2,408
(30,956)
4,278
(5,827)
1,925
(27,506)
(22,564)
—
5,103
(7,268)
(20,627)
(45,356)
2,938
(16)
174,607
6,665
29,774
(4,403)
2,714
(3,652)
9,818
5,985
308
(24)
17,322
114,370
(59,317)
4,559
(9,272)
(6,941)
43,399
922
1,501
(27,766)
6,444
—
4,087
(14,812)
(20,941)
—
2,776
(6,366)
(19,747)
(44,278)
(15,691)
107
190,191
Cash and cash equivalents, end of the period
8
$
177,529 $
174,607
1 Certain comparative figures in 2022 have been reclassified to conform to the presentation adopted in the current year (note 36).
The accompanying notes are an integral part of these consolidated financial statements.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
101
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Table of Contents – Notes to the Consolidated Financial Statements
1.
2.
3.
Structure of the company .................................................................................................................................. 103
Basis of preparation ............................................................................................................................................ 103
Use of estimates and judgements .................................................................................................................... 103
4. Material accounting policies .............................................................................................................................. 105
5. New accounting standards, amendments and interpretations adopted ................................................... 117
6.
7.
8.
9.
Future accounting changes ............................................................................................................................... 117
Business combinations ....................................................................................................................................... 117
Cash and cash equivalents ................................................................................................................................. 119
Accounts receivable ............................................................................................................................................ 119
10. Revenue, contract assets and contract liabilities ........................................................................................... 120
11. Other assets ......................................................................................................................................................... 121
12. Assets held for sale ............................................................................................................................................. 122
13. Projects and entities accounted for using the equity method .................................................................... 122
14. Property and equipment .................................................................................................................................... 124
15. Right-of-use assets .............................................................................................................................................. 125
16.
Intangible assets .................................................................................................................................................. 126
17. Goodwill ................................................................................................................................................................ 127
18. Loans and borrowings ........................................................................................................................................ 128
19. Leases and right-of-use liabilities ..................................................................................................................... 130
20.
Income taxes ........................................................................................................................................................ 130
21. Provisions .............................................................................................................................................................. 132
22. Other liabilities ..................................................................................................................................................... 133
23. Pension obligations ............................................................................................................................................. 133
24. Share-based compensation plans ..................................................................................................................... 135
25. Shareholders’ capital .......................................................................................................................................... 136
26. Earnings per share ............................................................................................................................................... 136
27. Finance and other income ................................................................................................................................. 137
28. Finance and other costs ..................................................................................................................................... 137
29. Personnel costs .................................................................................................................................................... 137
30. Other cash flow information .............................................................................................................................. 137
31. Financial instruments .......................................................................................................................................... 138
32. Capital management .......................................................................................................................................... 141
33. Commitments and contingencies ..................................................................................................................... 142
34. Related party transactions ................................................................................................................................. 142
35. Subsequent events .............................................................................................................................................. 143
36. Comparative figures ........................................................................................................................................... 143
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
102
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
1. Structure of the company
Bird Construction Inc. (the “Company”) is a corporation incorporated in the province of Ontario, Canada.
The address of the Company’s registered office is 5700 Explorer Drive, Suite 400, Mississauga, Ontario,
Canada. The Company’s common shares are traded on the Toronto Stock Exchange (“TSX”) under the
symbol BDT.
The Company operates from coast-to-coast and services all of Canada’s major geographic markets. The
Company provides a comprehensive range of construction services from new construction for industrial,
infrastructure and institutional markets; to industrial maintenance, repair and operations (“MRO”) services,
heavy civil construction and mine support services; as well as vertical infrastructure including, electrical,
mechanical, and specialty trades. The Company uses a variety of contract delivery methods including
construction management, cost plus, integrated project delivery ("IPD"), alliance, progressive design build,
stipulated sum, unit price, standard specification design-build, alternative finance projects, complex
design-build, and public private partnership ("PPP") contract delivery methods.
2. Basis of preparation
Statement of compliance
These financial statements (the “financial statements”) have been prepared in accordance with IFRS
Accounting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). These
financial statements were authorized for issue on March 5, 2024 by the Company’s Board of Directors.
Functional and presentation currency
These financial statements are presented in Canadian dollars, which is the Company’s functional currency.
Unless otherwise indicated, all financial information presented has been rounded to the nearest thousand.
Basis of measurement
These financial statements have been prepared on a going concern and historical cost basis, except for
certain financial assets, derivative financial instruments and liabilities for cash-settled share-based payment
arrangements which are measured at fair value as detailed in the accounting policies described in note 4.
Segmented results
Segment results are reviewed by the Company’s chief operating decision maker to assess performance and
allocate resources within the Company. Management applies judgement in the aggregation of the
Company’s operating segments and has determined that the Company operates in one reportable
segment being the general contracting sector of the construction industry. The Company’s operating
segments have similar economic characteristics in that the Company’s operating business units provide
comparable construction services, use similar contracting methods, have similar customer types, have
similar long-term economic prospects, share similar cost structures, and operate in similar regulatory
environments.
3. Use of estimates and judgements
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of revenues,
expenses, assets, liabilities and the disclosure of contingent assets and liabilities at the reporting date.
Uncertainty about these assumptions and estimates could result in a material adjustment to the carrying
amount of an asset or liability and/or the reported amount of revenue and expense in future periods.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognized in the period in which the estimates are revised and in any future periods affected.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
103
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Assets and liabilities acquired in a business combination
The Company assesses whether an acquisition transaction should be accounted for as an asset acquisition
or a business combination under IFRS 3 Business Combinations. The purchase price related to a business
combination is allocated to the underlying acquired assets and liabilities based on estimates of their fair
value at the time of acquisition. The determination of fair value requires the Company to make
assumptions, estimates and judgements regarding future cash flows, valuation techniques, economic risk,
weighted average cost of capital and future events. The measurement of purchase consideration and
allocation process are therefore inherently subjective and impact the amounts assigned to identifiable
assets and liabilities. As a result, the purchase price allocation impacts the Company’s reported assets and
liabilities (including the amounts allocated to intangible assets and goodwill), and future earnings due to
the associated depreciation and amortization expense along with the required impairment testing.
Revenue and gross profit recognition
Construction revenue, construction costs, contract liabilities, and contract assets are based on estimates
and judgements used in determining contract revenue and the determination of estimated costs to
complete in order to calculate the stage of completion for a particular construction project, depending
upon the nature of the construction contract, as more fully described in the revenue recognition policy. To
determine the estimated costs to complete construction contracts, assumptions and estimates are required
to evaluate matters related to schedule, material and labour costs, labour productivity, changes in contract
scope and subcontractor costs. Due to the nature of construction activities, estimates can change
significantly from one accounting period to the next.
The value of many construction contracts increases over the duration of the construction period. Change
orders may be issued by customers to modify the original contract scope of work or conditions. In addition,
there may be disputes or claims regarding additional amounts owing as a result of changes in contract
scope, delays, additional work or changed conditions. Construction work related to a change order or claim
may proceed, and costs may be incurred, in advance of final determination of the value of the change
order. Change orders and claims may not be settled until the construction project is complete or
subsequent to completion, and the nature of the relationship with the other party to the claim and the
history of success of these claims may impact the associated revenue or cost recovery. Claims against
customers for variable consideration due to factors described above are assessed under the Company’s
revenue policy, which requires significant judgement. The amount of variable consideration that is
constrained is the difference between the total claim value and the best estimate of recovery. This
constrained value is reviewed each reporting period.
Provisions
Legal, warranty and other provisions involve the use of estimates. Estimates and assumptions are required
to determine when to record, and how to measure, a provision in the financial statements. The outcomes
may differ significantly from the estimates used in preparing the financial statements resulting in
adjustments to previously reported financial results.
Impairment of non-financial assets
Management evaluates property and equipment, intangible assets with definite lives, and right-of-use
(“ROU”) assets at the end of each reporting period to determine if there are events or circumstances which
indicate that the carrying value may not be recoverable. Goodwill and intangible assets with indefinite lives
are tested for impairment annually, or more frequently if events or changes in circumstances indicate that
the asset may be impaired. Impairment testing is performed by comparing the recoverable amount of the
cash-generating unit ("CGU") or groups of CGUs to its carrying amount. There is a significant amount of
uncertainty with respect to the estimate of the recoverable amount given the necessity of making economic
projections which employ the following key assumptions: future cash flows, growth opportunities, including
economic risk assumptions, and estimates of achieving key operating metrics and drivers, and the discount
rate. Refer to note 17 for further details regarding the assumptions and estimates regarding the Company’s
goodwill impairment assessment.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
104
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Measurement of pension obligations
The Company’s obligations and expenses related to defined benefit (“DB”) pension plans are determined
using actuarial valuations and are dependent on a number of significant assumptions. The DB obligations
and benefit cost levels will change as a result of future changes in actuarial methods and assumptions,
membership data, plan provisions, legislative rules, and future experience gains or losses. Actual
experience that differs from assumptions may result in gains or losses that will be disclosed in future
accounting valuations. Refer to note 23 for further details regarding the Company’s DB pension plans.
Share-based payments
Compensation expense accrued for performance share units (“PSU”) is dependent upon the final number
of PSU awards that will eventually vest, adjusted for a performance multiplier, that is estimated by
management and approved by the Board of Directors. Large fluctuations in compensation expense may
occur due to changes in the underlying share price or revised management estimates of relevant
performance factors.
Leases
The Company applies judgement in reviewing each of its contractual arrangements to determine whether
the arrangement contains a lease within the scope of IFRS 16 Leases. Leases that are recognized are subject
to further management judgement and estimation in various areas specific to the arrangement, including
the term of the lease. In determining the lease term to be recognized, management considers all facts and
circumstances that create an economic incentive to exercise an extension option, or not to exercise a
termination option.
Where a lease does not specify an interest rate, lease liabilities are estimated using a discount rate equal to
the Company-specific incremental borrowing rate. This rate represents the rate that the Company would
incur to obtain the funds necessary to purchase an asset of a similar value, with similar payment terms and
security in a similar economic environment.
Income taxes
Tax regulations and legislation are subject to change and there are differing interpretations requiring
management judgement. Deferred tax assets are recognized when it is considered probable that
deductible temporary differences will be recovered in future periods, which requires management
judgement. Deferred tax liabilities are recognized when it is considered probable that temporary
differences will be payable to tax authorities in future periods, which requires management judgement.
Income tax filings are subject to audits and re-assessments and changes in facts, circumstances and
interpretations of tax laws may result in a material increase or decrease in the Company’s provision for
income taxes.
4. Material accounting policies
Consolidation
The financial statements include the accounts of the Company, its subsidiaries and partnerships, as well as
its pro-rata share of assets, liabilities, revenues, expenses and cash flows from joint operations. Subsidiaries
are entities controlled by the Company. The financial statements of subsidiaries are included in the financial
statements from the date that control commences until the date that control ceases. All inter-company
balances, transactions, revenues and expenses have been eliminated on consolidation.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
105
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
The financial statements include the accounts of the following significant subsidiaries:
Company
Ownership / Voting Interest
Fully consolidated subsidiaries
Bird Construction Inc.
Bird Construction Company Limited
Bird Construction Company (Limited Partnership)
Bird Management Ltd.
Bird Design-Build Construction Inc.
Bird Construction Group (Limited Partnership)
Bird Construction Group Ltd.
Bird Construction Industrial Services Ltd.
Bird General Contractors Ltd.
Stuart Olson Inc.
Stuart Olson Buildings Ltd.
Stuart Olson Construction Ltd.
Stuart Olson Industrial Inc.
Stuart Olson Industrial Services Ltd.
Stuart Olson Industrial Projects Inc.
Stuart Olson Industrial Constructors Inc.
Canem Systems Ltd.
The Churchill Corporation
Dagmar Construction Inc.
Trinity Communication Services Ltd.
Proportionately consolidated joint arrangements
Bird Kiewit Joint Venture
Bird – Maple Reinders JV
Maple Reinders – Bird JV
Bird – ATCO Joint Venture
CBS Joint Venture
Chandos Bird Joint Venture
BCIFSL – TCMLP JV
Acciona Stuart Olson Joint Venture
Stuart Olson/Nunavut Ltd.
Canem/Plan Group Joint Venture
Stuart Olson Industrial Contractors/Andritz Hydro Canada Inc.
FCG Construction/Stuart Olson, a Joint Venture
Maple –Bird IPD Joint Venture
Bird Dawson Joint Venture
Bird Chandos Halifax Water
LB LNG Constructors General Partnership
Rail Connect Partners
1Acquired on February 1, 2023 (note 7)
2023
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%1
60%
50%
50%
60%
42.5%
50%
49%
50%
40%
50%
50%
50%
50%
60%
75%
50%
50%
2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
n/a
60%
50%
50%
60%
42.5%
50%
49%
50%
40%
50%
50%
50%
50%
60%
n/a
n/a
n/a
The Company has invested in a number of Public Private Partnership (“PPP”) concession ventures, usually
holding a minority interest position in the venture. The Company has also invested in the Stack Modular
group of companies. In these instances, the Company can either exercise significant influence or joint
control over the financial and operational policies of the venture (or investee). The Company uses the
equity method of accounting to account for these investments. The investment is recorded as the amount
of the initial investment adjusted for the pro-rata share of the investee’s earnings less any distributions
received from the investment.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
106
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Company
Equity accounted investment in associates/joint ventures
Chinook Resources Management General Partnership
Plenary Infrastructure ERMF GP
Stack Modular Structures Ltd.
Stack Modular Structures Hong Kong Limited
Stack Modular, Inc.
Niagara Falls Entertainment Partners
Timmiak Construction Limited Partnership
Bird Capital P3SB2 Holdings Inc.
2Nations Bird Construction Ltd.
Ownership / Voting Interest
2023
2022
50%
10%
50%
50%
50%
50%
10%
50%
50%
n/a
20% / 16.2%
20% / 16.2%
69.99% / 33.33%
69.99% / 33.33%
20%
49%
20%
n/a
All of the above subsidiaries, joint arrangements, joint ventures and associates are incorporated or
registered in Canada except Stack Modular Structure Hong Kong Limited which is incorporated and
registered in Hong Kong, and Stack Modular, Inc. which is incorporated and registered in Delaware.
Revenue recognition
Contract revenue is recognized in the consolidated statement of income (the “statement of income”) in
accordance with the pattern of satisfying the Company’s performance obligations under a contract. This
satisfaction occurs when control of a good or service transfers to the customer. In the majority of the
Company’s contracts, the customer controls the work in process as evidenced by the right to payment for
work performed to date plus a reasonable profit to deliver products or services that do not have an
alternative use to the Company, and the work is performed on the customer’s property. Based on the
nature of these contractual arrangements, control is transferred over time and revenue is recognized over
time.
For each performance obligation satisfied over time, the Company recognizes revenue by measuring
progress toward complete satisfaction of that performance obligation. Using output or input methods
based on the type of contract, the Company recognizes revenue in a pattern that reflects the transfer of
control of the promised goods or services to the customer. Revenue from fixed price (including PPP,
alternative finance, design-build, and stipulated sum) and cost reimbursable (including cost plus and IPD)
contracts is recognized using the input method with reference to costs incurred. Revenue from unit price
contracts in the heavy construction, civil construction and contract surface mining construction sectors is
recognized based on the amount of billable work completed, established by surveys of work performed, an
output method. For agency relationships, such as construction management contracts, where the Company
acts as an agent for its customers, fee revenue only is recognized, generally in accordance with the contract
terms. Some contracts, particularly master service agreements and maintenance service contracts, do not
specify the amount of fixed consideration at contract inception, but will have a transaction price assigned to
it once a work order is issued. For the purpose of revenue recognition and disclosure, only the transaction
price of secured work, as evidenced by work orders, is included in revenue. If the outcome of a construction
contract cannot be estimated reliably for management to estimate the ultimate profitability of the contract
with a reasonable degree of certainty, no profit is recognized. As the contract progresses further, the
constrained margin and associated revenue are reassessed.
Revenue from contract modifications, commonly referred to as change orders and claims, is recognized to
the extent that the contract modifications have been approved by the customer and the amount can be
measured reliably. In cases where the contract modification is approved, but the price has not been
finalized, the Company accounts for the contract modification using variable consideration guidance
described below. A claim against or dispute with a customer is considered variable consideration as it is in
addition to the agreed upon performance obligations outlined in the original contract because of
additional costs incurred due to delays and/or scope changes, for example. The subsequent settlement of a
claim or dispute through negotiation results in uncertainty as to the likelihood and amount that will be
ultimately collected.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
107
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
The amount of variable consideration included in the transaction price may be constrained due to the
uncertain nature of the recovery of the associated revenue. The Company makes an estimate of the amount
to be constrained by using either the most likely amount or the expected value method, by contract,
depending which method is considered to best predict the amount of consideration to which the Company
will be entitled. The amount of variable consideration to be included in the transaction price is only that to
which it is highly probable that a significant reversal of cumulative revenue recognized to date will not
occur. Management considers the following factors in its assessment of the probability of reversal:
i. Susceptibility of consideration to factors outside the Company’s influence.
ii. Length of time, that is commercially unusual, before resolution of the uncertainty associated with the
amount of consideration is expected.
iii. The Company’s experience with similar types of contracts is limited or the experience is not relevant
or has limited predictive value.
iv. If, historically the Company has a practice of offering a broad range of pricing concessions or
changing the payment terms and conditions of similar contracts in similar situations.
v. The contract has a larger number and broad range of possible consideration amounts.
Where the above factors indicate uncertainty associated with the outcome of the transaction price, the
Company reviews the historical performance under similar contracts in order to determine the appropriate
proportion of the variable consideration to be included in the transaction price.
For most arrangements, the customer contracts with the Company to provide a significant service of
integrating a complex set of tasks and components into a single project or capability (even if that single
project results in the delivery of multiple units). The Company therefore considers that the entire contract
results in the delivery of a single performance obligation. Less commonly, the Company may promise to
provide distinct goods or services within a contract, in which case the contract is separated into the
associated performance obligations as assessed from the customer’s perspective. If a contract contains
multiple performance obligations, the Company allocates the total transaction price to each performance
obligation in an amount based on the estimated relative standalone selling prices of the promised goods or
services underlying each performance obligation. When the Company is contracted to construct projects, the
budgets and overall transaction prices are built up using the Company’s best estimate of costs associated to
complete the project using the appropriate overhead and subcontractor rates for a given project and
location. This approach to estimate the overall costs and associated revenues is considered the most
appropriate assessment of the standalone selling price for the associated performance obligations.
Where costs are determined to be greater than total revenues, losses from any construction contracts are
recognized in full in the period the loss becomes known. Losses are recorded within provisions on the
statement of financial position.
Costs of construction
Construction costs are expensed as incurred unless they result in an asset related to future contract activity
and meet the criteria to be capitalized as contract assets. Construction costs include all expenses that relate
directly to execution of the specific contract, including site labour and site supervision, direct materials,
subcontractor costs, equipment rentals and depreciation, design and technical assistance, and warranty
claims. Construction costs also include overheads that can be attributed to the project in a systematic and
consistent manner and include general insurance and bonding costs, and staff costs relating to project
management.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
108
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Contract assets and liabilities
Any excess of costs and estimated earnings over progress billings on construction contracts is carried as a
contract asset in the financial statements. Contract assets also arise when the Company capitalizes
incremental costs of obtaining contracts with customers and the costs incurred in fulfilling those contracts,
such as mobilization costs. Costs to fulfill a contract are required to be capitalized where they are determined
to relate directly to a contract or an anticipated contract that the entity can specifically identify, they generate
or enhance resources of the Company that will be used in satisfying performance obligations in the future,
and they are expected to be recovered under that specific contract.
In all cases, the specific contract asset is amortized with reference to the same pattern of recognition as the
revenue recognized on the associated project.
Any excess of progress billings over earned revenue on construction contracts is carried as a contract liability
in the financial statements.
Contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each
reporting period. All contract assets and liabilities are classified as current in the financial statements as they
are expected to be settled within the Company’s normal operating cycle. The operating cycle of many of the
Company’s contracts exceeds 12 months, depending on the type of project or the nature of the service being
provided.
Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a
business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair
values of the assets transferred by the Company, liabilities assumed by the Company and the equity interests
issued or cash paid by the Company in exchange for control of the acquiree. Acquisition-related costs are
expensed as incurred, unless related to the issuance of debt or equity.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognized at their fair
value, except that:
i. Deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements are
recognized and measured in accordance with IAS 12 Income taxes, and IAS 19 Employee benefits,
respectively;
ii. For any ROU (i.e. lease) assets and ROU liabilities identified in which the acquiree is the lessee, IFRS 3
Business combinations requires the lease liability to be measured at the present value of the
remaining lease payments as if the acquired lease were a new lease at the acquisition date. The ROU
asset is measured at an amount equal to the lease liability, adjusted to reflect the favourable or
unfavourable terms of the lease when compared with market terms.
The Company measures goodwill as the excess of the fair value of the consideration transferred, if any, over
the net recognized amount (generally fair value) of the identifiable assets acquired and liabilities assumed, all
measured as of the acquisition date.
Property and equipment
Property and equipment is measured at cost less accumulated depreciation and accumulated impairment
losses, if any. The cost of property and equipment includes the purchase price and the directly attributable
costs required to bring the asset to the condition necessary for the asset to be capable of operating in the
manner intended by management. The cost of replacing or repairing a component of an item of property and
equipment is recognized in the carrying amount of the item if it is probable that future economic benefits will
occur and the cost can be measured reliably. The costs of routine maintenance of property and equipment
are recognized in the statement of income as incurred.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
109
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Depreciation is calculated based on the cost of an asset (or deemed cost) less its residual value. Depreciation
commences when the asset is available for use and ceases on the earliest of when the asset is derecognized
or classified as held-for-sale. When parts of an item of property and equipment have different useful lives,
they are accounted for as separate components of property and equipment and depreciated accordingly.
The carrying amount of a replaced component is derecognized. The Company reviews the residual value,
useful lives and depreciation methods used on an annual basis and, where revisions are required, the
Company applies such changes in estimates on a prospective basis.
Depreciation of property and equipment over the estimated useful lives of the assets is as follows:
Diminishing balance method
Buildings
Equipment, trucks and automotive
Heavy equipment
Furniture, fixtures and office equipment
Straight line method
Leasehold improvements
4%
20% - 40%
Hours of use
20% - 55%
Over the lease term
Gains and losses on disposals of property and equipment are determined by comparing the proceeds with
the carrying amount of the asset and are included as part of general and administrative expenses in the
statement of income.
Leases
Lessee arrangements
A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a
period of time in exchange for consideration. On the date that the leased asset becomes available for use,
the Company recognizes a ROU asset and a corresponding ROU liability. Finance costs associated with the
lease obligation are charged to the statement of income over the lease period with a corresponding increase
to the ROU liability. The ROU liability is reduced as payments are made against the principal portion of the
lease. The ROU asset is depreciated over the shorter of the asset’s useful life and the lease term on a straight-
line basis. Depreciation of the ROU asset is recognized as part of costs of construction or general and
administrative expenses, depending on the nature of the leased asset.
ROU assets and liabilities are initially measured on a present value basis. Lease obligations are measured as
the net present value of the lease payments which may include: fixed lease payments, variable lease
payments that are based on an index or a rate, amounts expected to be payable under residual value
guarantees, and payments to exercise an extension or termination option, if the Company is reasonably
certain to exercise either of those options. ROU assets are measured at cost, which is composed of the
amount of the initial measurement of the ROU liability, less any incentives received, plus any lease payments
made at, or before, the commencement date and initial direct costs and asset restoration costs, if any. The
rate implicit in the lease is used to determine the present value of the liability and asset arising from a lease,
unless this rate is not readily determinable, in which case the Company's incremental borrowing rate is used.
The Company has applied a number of practical expedients identified in the standard as follows:
i. Short-term leases and leases of low-value assets are not recognized in the statement of financial
position and lease payments are instead recognized in the financial statements as incurred.
ii. For certain classes of leases, the Company has elected not to separate lease and non-lease
components (which transfer a separate good or service under the same contract) and instead the
Company accounts for these leases as a single lease component.
iii. Certain leases having similar characteristics are accounted for as a portfolio.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
110
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Lessor arrangements
When the Company acts as a lessor, it determines at lease inception whether each lease is a finance lease or
an operating lease. To classify each lease, the Company makes an overall assessment of whether the lease
transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the
case, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the
Company considers certain indicators, such as whether the lease is for the major part of the economic life of
the asset.
When the Company is an intermediate lessor, it accounts for its interests in the head lease and the sublease
separately. It assesses the lease classification of a sublease with reference to the ROU asset arising from the
head lease, not with reference to the underlying asset.
Goodwill
Goodwill is the residual amount that results when the purchase price of an acquired business exceeds the
sum of the amounts allocated to the identifiable assets acquired less liabilities assumed, based on their fair
values. Goodwill is not amortized but is tested for impairment on an annual basis or more frequently if there
are indicators that goodwill may be impaired. Goodwill is carried at cost less any accumulated impairment.
Intangible assets
Intangible assets with finite lives are comprised of computer software, and assets related to the acquisition of
a business, including backlog and agency contracts and customer relationships. These intangible assets are
measured at cost less accumulated amortization and accumulated impairment losses, if any. Amortization is
calculated using the cost of the asset, and commences once the asset is available for use and is recognized in
the statement of income based on the expected pattern of consumption of the economic benefits of the
asset. Amortization methods, useful lives and residual values are reviewed on an annual basis and adjusted
where appropriate. Intangible assets with indefinite lives comprising of trade names are not amortized.
The estimated useful lives of each class of intangible assets are as follows:
Asset
Computer software
Basis
Straight line
Backlog and agency contracts
As related revenue is earned
Customer relationships
Trade names
Straight line
Straight line
Useful Life
1 to 10 years
1 to 3 years
3 to 7 years
5 years or indefinite
Impairment of non-financial assets
The carrying amounts of the Company’s non-financial assets, other than inventories and deferred tax assets
for which separate processes apply, are reviewed at each reporting date to determine whether there is any
indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For
intangible assets that have an indefinite useful life or intangible assets that are not yet available for use, the
recoverable amount is estimated annually.
The recoverable amount of a CGU is the greater of its value-in-use and its fair value less costs of disposal. In
assessing value-in-use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to the
asset. For the purpose of impairment testing, assets that cannot be tested individually are grouped together
into the smallest group of assets that generates cash inflows from continuing use that are largely
independent of the cash inflows of other assets or groups of assets (i.e. a CGU). For the purpose of goodwill
impairment testing, goodwill acquired in a business combination is allocated to the CGU, or the group of
CGUs, that is expected to benefit from the synergies of the combination. This allocation is subject to an
operating segment ceiling and reflects the lowest level at which the goodwill is monitored for internal
reporting purposes.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
111
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
An impairment loss is recognized if the carrying amount of an asset or its CGU exceeds its estimated
recoverable amount. Impairment losses are recognized in the statement of income. Impairment losses
recognized in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to
the CGUs, and then to reduce the carrying amounts of the other assets in the CGUs on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses
recognized in prior periods are assessed at each reporting date for any indications that the loss has
decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates
used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s
carrying amount does not exceed the carrying amount that would have been determined, net of depreciation
or amortization, if no impairment loss had been recognized.
Provisions and contingent assets
Provisions
Provisions are recognized when, at the financial statement date, the Company has a present obligation as a
result of a past event, it is more likely than not that the Company will be required to settle that obligation,
and the cash outflow can be estimated reliably. The amount recognized for provisions is the best estimate of
the expenditure to be incurred. Where the Company expects some or all of the provision to be reimbursed,
for example through insurance, the reimbursement is recognized as an asset only when it is virtually certain of
realization. The recoverable amount will not exceed the amount of the provision. Provisions include:
i. Provisions for potential legal claims relating to the Company’s performance and completion of
construction contracts. The Company attempts to settle claims within the construction period of the
contracts, but a legal claim may take years to settle.
ii. Provisions for potential warranty claims relating to construction projects. These claims are usually
settled during the project’s warranty period.
iii. Provisions for loss contracts are recorded when costs are estimated to be greater than total revenues
for the contract. Losses from construction contracts are recognized in full in the period the loss
becomes known. The loss provision will be net of management’s estimate of probable expected
recoveries, which differs from the criterion used for revenue recognition.
Contingent assets
A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of
the entity. Cost recovery claims associated with claims against subcontractors and parties other than
customers are considered contingent assets until it is virtually certain that the claims will be settled.
Contingent assets are not recorded or disclosed in the financial statements.
Subcontractor/ supplier performance default insurance
The Company maintains an insurance policy which provides the Company with comprehensive coverage in
respect of subcontractor or supplier default on certain projects where the subcontractor or supplier is
enrolled in the program. The total insurance premium paid by the Company to the insurer is comprised of a
non-refundable premium and a deposit premium. The deposit premium paid by the Company is included in
other non-current assets on the consolidated statement of financial position (the “statement of financial
position”). The liabilities included in provisions on the statement of financial position relate to management’s
best estimate of exposures and costs associated with prior or existing subcontractor or supplier performance
defaults. Management conducts a thorough review of the liability every reporting period and takes into
consideration the Company’s experience to date with those subcontractors or suppliers that are enrolled in
the program.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
112
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Foreign currency translation
Foreign currency transactions
Foreign currency transactions and balances are recorded in the accounts as follows:
i. Monetary assets and liabilities at the exchange rate in effect at the financial statement date;
ii. Non-monetary assets and liabilities at exchange rates prevailing at the time of the transaction;
iii. Depreciation expense at the exchange rate in effect at the time the related assets are acquired; and
iv. Revenue and expenses at the average exchange rate prevailing on the date of the transaction.
Translation of equity accounted foreign entities
Assets and liabilities of equity accounted foreign entities are translated from the functional currency to the
Company’s presentation currency at the closing rate at the end of the reporting period. The statements of
income are translated at exchange rates at the dates of the transactions or at the average rate if it
approximates the actual rates. All resulting exchange differences are recognized in other comprehensive
income.
Income taxes
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognized in the
statement of income except to the extent that it relates to a business combination, or items recognized
directly in equity or in other comprehensive income.
Current income taxes are recognized for the estimated income taxes payable based on applying enacted
income tax rates to the taxable income realized in the current year. Current tax includes adjustments to taxes
payable or recoverable in respect of previous years.
Deferred income tax assets and liabilities are recognized for temporary differences between the tax basis of
assets and liabilities and their carrying amounts for financial reporting purposes, as well as for the benefit of
tax losses available to be carried forward to future years provided they are likely to be realized. Deferred
taxes are recognized using enacted or substantively enacted rates expected to apply in the periods in which
the asset is realized or the liability is settled. Deferred taxes are measured on an undiscounted basis.
Deferred taxes are presented as non-current. Current and deferred tax assets and liabilities are offset only
when a legally enforceable right exists to offset current tax assets against current tax liabilities relating to the
same taxable entity and the same tax authority.
Post-employment benefits
Defined benefit ("DB") pension costs are actuarially determined using the projected unit credit method and
management’s best estimate of salary escalation and retirement age of employees. The Company’s net
obligation in respect of DB pension plans is calculated separately for each plan by estimating the amount of
future benefits that employees have earned in return for their service in the current and prior periods; that
benefit is discounted to determine its present value. Any recognized past service costs and the fair value of
plan assets are deducted. The discount rate used to establish the pension obligation is determined by
reference to market interest rates on AA-rated corporate bonds with cash flows that approximate the timing
and amount of expected benefit payments. When the calculation results in a benefit to the Company, the
recognized asset is limited to the total of any unrecognized past service costs and the present value of
economic benefits available in the form of any future refunds from the plan or reductions in future
contributions to the plan. In order to calculate the present value of economic benefits, consideration is given
to any minimum funding requirements that apply to any plan within the Company. An economic benefit is
available to the Company if it is realizable during the life of the plan, or on settlement of the plan liabilities.
The pension deficit or surplus is adjusted for any material changes in underlying assumptions. The Company
recognizes all actuarial gains and losses arising from the DB plans in other comprehensive earnings in the
period in which they occur. When the benefits of a plan are improved, the portion of the increased benefit
related to past service by employees is recognized in the statement of income on a straight-line basis over
the average service period until the benefits become vested. To the extent that the benefits vest
immediately, the expense is recognized immediately in the statement of income.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
113
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Medium term incentive plan
The Company’s Medium Term Incentive Plan (“MTIP”) is a cash-settled share-based payment plan which
provides for the granting of phantom shares. The phantom shares provide the holder with the opportunity to
earn a cash benefit in relation to the value of a specified number of underlying notional shares. When new
MTIP awards are issued, the value of the initial award is determined, which is then used to determine the
number of shares allocated to the employee. The total liabilities for this plan are computed based on the
estimated number of phantom shares expected to vest at the end of the vesting period. The liability is
measured at each reporting date at fair value with changes in fair value recognized in income. The fair value
of the phantom shares outstanding at the end of a reporting period is measured based on the quoted market
price of the Company’s shares. The phantom shares earn notional dividends, equivalent to actual dividends
declared on the Company’s shares. Compensation expense relating to the initial award, notional dividends
and changes in the market price of the phantom shares is recognized on a straight-line basis in general and
administrative expenses in the statement of income over the vesting period.
Equity incentive plan
The Company has an Equity Incentive Plan (“EIP”) as part of the Company’s executive compensation plan.
The purpose of the EIP is to provide certain officers and employees of the Company with the opportunity to
be granted performance share units (“PSU”) or time-based restricted share units (“RSU”), and together with
PSUs, the (“Units”). The EIP is a full-value share unit plan using the value of the Company’s shares as the basis
for the Units. In the case of the PSUs, the amount of award payable at the end of the vesting period will be
determined by a performance multiplier. Under the EIP, the Company is entitled, in its sole discretion, to
settle the Units in either cash or the Company’s Shares purchased on the TSX or issued from treasury, or a
combination thereof. The Company intends to settle the EIP in cash.
As a cash-settled compensation arrangement, the fair value of the amount payable is recognized as an
expense with a corresponding increase in liabilities over the vesting period. The Units will vest and be settled
on their issue date, which will be no later than December 31 in the third year following the date of grant, or in
accordance with the EIP, participant’s award agreement, or the Company’s discretion. The liabilities for this
plan are calculated based on the estimated number of Units expected to vest at the end of the vesting
period. The Units earn notional dividends, equivalent to actual dividends declared on the Company’s shares.
The liability is remeasured at each reporting date at fair value with changes in fair value recognized in income.
The fair value of the Units outstanding at the end of a reporting period is measured based on the quoted
market price of the Company’s shares, with PSUs also adjusted by a performance multiplier. Compensation
expense relating to the initial award, notional dividends and changes in the market price of the Units is
recognized on a straight-line basis in general and administrative expenses in the statement of income over
the vesting period.
Deferred share unit plan
The Company has a Deferred Share Unit Plan ("DSU Plan"), which is a cash-settled share-based payment
plan. The fair value of the amount payable to eligible Directors in respect of Deferred Share Units ("DSU") is
equivalent to the cash value of the common shares at the reporting date. The DSUs earn notional dividends,
equivalent to actual dividends declared on the Company's shares. DSUs are eligible to be cash-settled no
later than December 31 of the following year in which the Director ceases to hold any position within the
Company. The liability associated with the DSU Plan is recalculated at each reporting date and at settlement.
Any change in the fair value of the liability is recognized in general and administrative expenses in the
statement of income.
Cash and cash equivalents
The Company considers cash, bank indebtedness, if any, bankers’ acceptances and short-term deposits with
original maturities of three months or less, as cash and cash equivalents.
Restricted cash
Restricted cash represent amounts that management has determined are not available for general operating
purposes. Restricted cash consists of cash held in trust, relating to trust obligations on certain projects for
which we have segregated accounts, and cash held to support letters of credit.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
114
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Financial instruments
Classification and measurement of financial instruments
Financial assets and liabilities are recognized on the statement of financial position when the Company
becomes a party to the contractual provisions of the financial instrument or derivative contract. The Company
derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or it
transfers the rights to receive the contractual cash flows on the financial asset in a transaction in which
substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in
transferred financial assets that is created or retained by the Company is recognized as a separate asset or
liability. Financial liabilities are derecognized when their contractual obligations are discharged, cancelled or
have expired. Financial instruments are initially measured at fair value and are subsequently accounted for
based on their classification as described below. The classification of financial assets is determined by their
context in the Company’s business model and by the characteristics of the financial asset’s contractual cash
flows.
• Amortized cost: The contractual cash flows received from the financial assets are solely payments of
principal and interest and are held within a business model whose objective is to collect the
contractual cash flows. The financial assets and financial liabilities are subsequently measured at
amortized cost using the effective interest method.
• Fair value through profit or loss (“FVTPL”): A financial asset is measured at FVTPL if it does not meet
the criteria for assets measured at amortized cost or FVTOCI. Financial assets at FVTPL include held
for trading assets and derivative instruments. Financial assets at FVTPL are measured at fair value with
changes recognized in the statement of income. Transaction costs associated with assets classified as
FVTPL are expensed as incurred.
• Fair value through other comprehensive income (“FVTOCI”): The Company does not have any
financial assets held at FVTOCI at December 31, 2023 or 2022.
The Company has the following financial assets and liabilities:
Classification & basis of measurement
Financial assets:
Cash and cash equivalents
Accounts receivable
Subcontractor / Supplier insurance deposits
Derivative contracts
Lease receivables
Financial liabilities:
Accounts payable
Dividends payable to shareholders
Loans and borrowings
Right-of-use liabilities
Acquisition holdback liability
Derivative contracts
Amortized cost
Amortized cost
Amortized cost
FVTPL
Amortized cost
Amortized cost
Amortized cost
Amortized cost
Amortized cost
Amortized cost
FVTPL
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
115
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Derivative financial instruments
The Company uses interest rate swaps to manage its interest rate risk on non-recourse project financing
and its variable rate loans and borrowings. The Company also uses Total Return Swap (“TRS”) derivative
contracts for the purpose of managing its exposure to changes in the fair value of its MTIP, EIP and DSU
share-based compensation plans due to changes in the fair value of the Company’s common shares. The
changes in the fair market value are recorded as compensation expense in general and administrative
expenses in the statement of income. The Company uses foreign currency forward contracts to buy US
dollars for the purpose of managing its foreign currency risk. Unrealized gains and losses in the fair value of
the foreign currency forward contracts are recognized in general and administrative expenses in the
statement of income. The Company does not designate any of its derivative contracts as hedges.
Impairment of financial assets
Financial assets measured at amortized cost are assessed at each reporting date to determine whether
there is objective evidence of impairment. An expected credit loss (“ECL”) impairment model is applied,
where the ECL is the present value of all cash shortfalls over the expected life of the financial asset.
Impairment is measured at either the 12-month ECL or lifetime ECL. The Company recognizes the 12-
month ECL in the statement of income; however, for trade receivables and contract assets that do not
contain a significant financing component, a lifetime ECL is measured at the date of initial recognition.
A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial
recognition of the asset, and that the loss event will have a negative effect on the estimated future cash
flows of the asset that can be estimated reliably.
An impairment loss in respect of a financial asset measured at amortized cost is calculated as the difference
between its carrying amount and the present value of the estimated future cash flows discounted at the
asset’s original effective interest rate. The carrying amounts of financial assets are reduced by the amount
of the ECL through an allowance account and losses are recognized in general and administrative expenses
in the statement of income.
Joint arrangements
A joint arrangement is an arrangement in which the Company has joint control, established by contractual
agreements requiring unanimous consent for decisions about activities that significantly affect the
arrangement's returns. Joint arrangements are classified as either a joint operation or a joint venture. A
joint operation is an arrangement where the joint controlling parties have direct rights to the assets and
direct obligations for the liabilities of the arrangement in the normal course of business. Interests in a joint
operation are accounted for by recognizing the Company's share of assets, liabilities, revenues and
expenses. A joint venture is an arrangement where the joint controlling parties have rights to the net assets
of the arrangement. Interests in a joint venture are recognized as an investment and accounted for using
the equity method. The determination as to whether a joint arrangement is a joint venture or a joint
operation requires significant judgement based on the structure of the arrangement, the legal form of any
separate vehicle, the contractual terms of the arrangement and other facts and circumstances. The joint
arrangements in which Bird participates are typically formed to undertake a specific construction project,
are jointly controlled by the parties, and are dissolved upon completion of the project.
Finance and other income and finance and other costs
Finance and other income is comprised of interest earned on cash and cash equivalents, interest earned on
lease receivables, gains/losses on disposal of investments and changes in the fair value of financial assets
classified as FVTPL. Interest income is recognized as it accrues in the income statement.
Finance and other costs are comprised of interest on loans and borrowings including non-recourse project
financing using the effective interest rate method, interest expense related to ROU liabilities, interest
expense related to the net gain or loss on interest rate swaps, interest associated with TRS contracts, fees
associated with credit facilities, bank charges and other interest expenses.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
116
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
5. New accounting standards, amendments and interpretations adopted
The Company has adopted new amendments effective January 1, 2023 related to amendments to IAS 1
Disclosure of Accounting Policies, IAS 8 Definition of Accounting Estimates and IAS 12 Income Taxes that
did not have a material impact on the Company’s financial statements.
6. Future accounting changes
There are new accounting standards and amendments to accounting standards and interpretations that are
effective for annual periods beginning on or after January 1, 2024 that have not been applied in preparing
the financial statements for the period ended December 31, 2023. These standards and interpretations are
not expected to have a material impact on the Company’s financial statements.
7. Business combinations
Acquisition of Trinity Communication Services Ltd.
On February 1, 2023, the Company acquired all of the issued and outstanding shares of Trinity
Communication Services Ltd. (“Trinity”). Trinity is a diversified telecommunication and utility infrastructure
contractor based in Ontario, and provides services to major national and regional telecommunication,
utilities, power, and internet service providers. Trinity specializes in underground, aerial, commercial inside
plant, and multi-dwelling unit
installations. These self-perform capabilities enable cross-selling
opportunities to the Company's sizeable national client base across multiple sectors. Overall, Trinity's
capabilities complement the Company's significant electrical service offering and serve as a growth catalyst
for the Company's utilities portfolio.
The purchase price of the transaction totalled $6,902 and included cash of $5,620, equity of $688, and a
holdback and other liability of $594. The $594 holdback and other liability consisted of $294 related to a
working capital reconciliation that was paid in the second quarter of 2023, and $300 relating to any
indemnities provisions to be reconciled as at the second anniversary of the closing date.
In connection with this acquisition, the Company incurred acquisition costs of $85, comprised mainly of
consulting and other professional fees, which were presented in general and administrative expenses in the
statement of income. Transaction costs of $7 directly attributable to the issue of common shares related to
the transaction were recognized as a reduction from shareholders' capital.
The Trinity acquisition has been accounted for as a business combination using the acquisition method of
accounting whereby the assets acquired, and liabilities assumed are recognized at their fair value, except
for deferred tax assets or liabilities and ROU assets and ROU liabilities identified in which the acquiree is
the lessee. The fair value assigned to the net assets acquired is preliminary, and is based on estimates and
assumptions using information available at the time of preparation of these consolidated financial
statements. The value of the assets and liabilities associated with the Trinity acquisition were finalized
subsequent to year end on February 1, 2024. No measurement period adjustments were made to the
purchase price allocation to reflect new information obtained by the Company with respect to the facts and
circumstances that existed as of February 1, 2023.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
117
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Total common shares issued as consideration
Common share price at close on February 1, 2023
Equity consideration
Acquisition holdback and other liability
Cash consideration
Total Consideration
Fair value of assets and liabilities of Trinity acquired:
Assets acquired
Accounts receivable
Income taxes recoverable
Inventory and Prepaid expense
Property and equipment
ROU assets
Intangible assets
Liabilities assumed
Bank Indebtedness
Accounts payable
ROU liabilities
Net deferred income tax liabilities
Net identifiable assets acquired
Goodwill
Net assets acquired
$
$
$
$
$
$
79,346
8.67
688
594
5,620
6,902
6,624
120
245
524
2,414
2,517
(200)
(2,478)
(2,414)
(702)
6,650
252
6,902
The fair value and gross amount of the trade receivables acquired amounted to $6,624.
Goodwill and intangible assets
Goodwill of $252 recognized as part of the acquisition is attributed to expected revenue growth and future
market development, specifically in the telecom utilities sector. These benefits are not recognized
separately from goodwill, as the future economic benefits arising from them cannot be reliably measured.
The goodwill recognized is not deductible for tax purposes. Identifiable intangible assets acquired of
$2,517 include computer software, backlog and customer relationships.
Acquisition of NorCan Electric Inc.
Subsequent to the year ended December 31, 2023, on January 18, 2024, the Company acquired the assets
of NorCan Electric Inc. ("NorCan") a leading electrical and instrumentation contractor in Alberta. The
purchase price of the transaction totalled $11,113 and included cash of 9,420 which was funded by debt
and equity of $1,693.
The Company acquired all customer contracts, NorCan’s share of the NorCan/Infinity Limited Partnership
as a partner with Infinity Métis Corporation, property and equipment, and the highly qualified workforce
providing services to clients. Other than certain prepaid assets, no working capital was acquired as part of
the transaction.
In connection with this acquisition, the Company incurred acquisition costs of $162, comprised mainly of
consulting and other professional fees, which are presented in general and administrative expenses in the
statement of income.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
118
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
The NorCan acquisition has been accounted for as a business combination using the acquisition method of
accounting whereby the assets acquired, and liabilities assumed are recognized at their fair value, except
for ROU assets and ROU liabilities identified in which the acquiree is the lessee. The fair value assigned to
the assets acquired is preliminary, and is based on estimates and assumptions using information available
at the date these consolidated financial statements were authorized for issue. The purchase price allocation
may be adjusted in the future because certain fair values have not yet been finalized.
Total common shares issued as consideration
Common share price at close on January 18, 2024
Equity consideration
Cash consideration
Total Consideration
Fair value of assets and liabilities of NorCan acquired:
Assets acquired
Other current assets
Property and equipment
ROU assets
Intangible assets
Liabilities assumed
ROU liabilities
Net identifiable assets acquired
Goodwill
Net assets acquired
Goodwill and intangible assets
117,270
14.44
1,693
9,420
11,113
36
740
408
6,645
(408)
7,421
3,692
11,113
$
$
$
$
$
Goodwill of $3,692 recognized as part of the acquisition is attributed to expected revenue growth and
future market development, specifically in the industrial sector. These benefits are not recognized
separately from goodwill, as the future economic benefits arising from them cannot be reliably measured.
Identifiable intangible assets acquired of $6,645 include customer relationships and trade names.
8. Cash and cash equivalents
Accessible cash
Cash held for joint operations
Restricted cash and cash equivalents
9. Accounts receivable
Progress billings on construction contracts
Holdbacks receivable (due within one operating cycle)
Other
$
$
$
$
2023
79,884 $
62,529
35,116
2022
96,011
15,622
62,974
177,529 $
174,607
2023
564,704 $
280,582
5,165
850,451 $
2022 (note 36)
454,524
244,791
6,301
705,616
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
119
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Accounts receivable are reported net of an allowance for doubtful accounts of $345 as at December 31,
2023 (December 31, 2022 – $1,632). Holdbacks receivable represent amounts billed on construction
contracts which are not due until the contract work is substantially complete and the applicable lien period
has expired.
10. Revenue, contract assets and contract liabilities
Disaggregation of revenue
The Company disaggregates revenue from contracts with customers by contract type, as this best depicts
how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic
factors.
Public Private Partnerships (“PPP”)
Alternative finance projects and complex design-build
Stipulated sum, unit price and standard specification design-build
Construction management, cost plus and IPD
2023
123,427 $
2022 (note 36)
55,129
149,708
1,275,641
1,250,009
2,798,785 $
120,636
1,333,889
859,678
2,369,332
$
$
Remaining performance obligations
The total value of all contracts awarded to the Company, less the total value of work completed on these
contracts as of the reporting date, is referred to as remaining performance obligations. This includes all
contracts that have been awarded to the Company whether the work has commenced or will commence in
the normal course.
As at December 31, 2023, the aggregate amount of remaining performance obligations from construction
contracts was $3,448,237. The value of remaining performance obligations does not include amounts for
variable consideration that are constrained, agency relationship construction management projects, and
estimated future work orders or other formal documents to proceed to be performed as part of recurring
revenue agreements.
The Company expects to recognize approximately 62% of the remaining performance obligations over the
next 12 months with the remaining balance being recognized beyond 12 months. This expectation is based
on management’s best estimate but contains uncertainty as it is subject to factors outside of the
Company's control.
The Company’s measure of remaining performance obligations is also referred to as “Backlog” and
additions to remaining performance obligations are also referred to by the Company as “Securements.”
These measures may not be comparable with the calculation of similar measures by other entities as
Backlog and Securements are not terms defined under IFRS.
Summary of contract balances
The following table provides information about receivables, contract assets and contract liabilities from
contracts with customers:
Progress billings and holdbacks receivable (note 9)
Contract assets
Contract liabilities
2023
2022 (note 36)
$
$
845,286
99,562
(206,342)
738,506 $
699,315
56,938
(146,986)
609,267
Progress billings and holdbacks receivable
The Company issues invoices in accordance with the billing schedule or contract terms. These invoices
trigger recognition of accounts receivable.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
120
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Contract assets
The Company receives payments from customers based on a billing schedule, as established in the
contracts. A contract asset relates to the conditional right to consideration for completed performance
under the contract. Accounts receivable are recognized when the right to consideration becomes
unconditional. Contract assets related to construction contracts are typically invoiced within a year.
Balance, December 31, 2022
Additions to contract assets
Reduction of contract assets due to progress billings
Balance, December 31, 2023
2023
2022
Construction
Contracts
56,938 $
1,201,418
(1,158,794)
99,562 $
$
$
Construction
contracts
55,949
887,930
(886,941)
56,938
Contract liabilities
Contract liabilities relate to payments received in advance of performance under the contract. Contract
liabilities are recognized as revenue as (or when) the Company performs under the contract. Typically,
contract liabilities are recognized within a year as performance is achieved per contractual terms.
For the year ended December 31, 2023, $146,986 of revenue (2022 – $130,315) was recognized that was
included in the contract liability balance at the beginning of the year.
For the year ended December 31, 2023, $4,022 of revenue (2022 - $6,937) was recognized from the
satisfaction of performance obligations related to previous periods. Amounts represent changes in the
transaction price due to contract modifications and various other cumulative catch up adjustments.
11. Other assets
Subcontractor / Supplier insurance deposits
Lease receivables
TRS derivative (note 24)
Other
Other assets
Less: current portion
TRS derivative
Lease receivables
Current portion
Non-current portion
$
$
$
2023
1,103 $
3,142
48
566
4,859 $
48
1,162
1,210
3,649 $
2022
1,751
4,702
2,950
372
9,775
2,950
1,286
4,236
5,539
Subcontractor/Supplier insurance deposits relate to the Company's insurance policies which provide Bird
with comprehensive coverage, subject to a deductible, in respect of subcontractor or supplier default on
certain projects where the subcontractor or supplier is enrolled in the program.
In December 2023, the Company amended the terms of the TRS derivative to reset the notional share price
to the then current market share price of Bird common shares, resulting in a partial settlement of the
derivative and cash receipt of $16,847.
The Company subleases certain facilities. The following is a detailed maturity analysis of the undiscounted
finance lease payments receivable as at December 31, 2023:
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
121
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Carrying
amount
Contractual
cash flows
Not later
than 1 year
Later than 1
year and
less than 3
years
Later than 3
years and
less than 5
years
Later than 5
years
Lease receivables
$
3,142 $
3,399 $
1,241 $
1,742 $
416 $
—
12. Assets held for sale
Assets held for sale
Balance, beginning of period
Reclassifications into (out of) held for sale
Capital distributions received
Sale of investment
Balance, end of period
$
$
2023
2,341 $
2,319
(298)
(2,277)
2,085 $
2022
4,416
(436)
(242)
(1,397)
2,341
Investments in equity accounted entities classified as held for sale
During the first quarter of 2023, the Company initiated plans to sell an investment in an entity accounted for
using the equity method. The investment was sold for a nominal gain in the second quarter of 2023.
13. Projects and entities accounted for using the equity method
The Company performs certain construction and concession related projects through joint ventures and
associates which are accounted for using the equity method. The Company’s joint ventures and associates
are private entities and there is no quoted market value available for their shares.
Total current assets
Total non-current assets
Total assets
Total current liabilities
Total non-current liabilities
Total liabilities
Net assets – 100%
Attributable to the Company
Revenue – 100%
Total comprehensive income (loss) – 100%
Attributable to the Company
2023
Joint ventures
Associates
$
50,343 $
26,233 $
113,057
163,400
45,304
100,032
145,336
169,092
195,325
7,889
159,832
167,721
18,064 $
7,719 $
27,604 $
2,760 $
Total
76,576
282,149
358,725
53,193
259,864
313,057
45,668
10,479
231,555 $
8,452 $
240,007
8,533 $
3,021 $
2,663 $
266 $
11,196
3,287
$
$
$
$
$
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
122
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Total current assets
Total non-current assets
Total assets
Total current liabilities
Total non-current liabilities
Total liabilities
Net assets – 100%
Attributable to the Company
Revenue – 100%
Total comprehensive income (loss) – 100%
Attributable to the Company
2022
Joint ventures
Associates
$
73,809 $
26,372 $
105,372
179,181
28,376
130,677
159,053
172,802
199,174
8,151
163,923
172,074
20,128 $
7,076 $
27,100 $
2,710 $
Total
100,181
278,174
378,355
36,527
294,600
331,127
47,228
9,786
74,894 $
8,154 $
83,048
(7,411) $
(3,050) $
2,318 $
232 $
(5,093)
(2,818)
$
$
$
$
$
The movement in the investment in projects and entities accounted for using the equity method is as
follows:
Investments in equity accounted entities
Balance, beginning of period
Share of net income (loss) for the period
Share of other comprehensive income (loss) for the period
Capital distributions received
Investments in equity accounted entities reclassified as held for sale
(note 12)
Balance, end of period
Share of net income (loss) for the period
Gain on sale of investments in equity accounted entities
Income (loss) from equity accounted investments
$
$
$
$
2023
9,786 $
3,287
93
13,166
(368)
(2,319)
10,479 $
2023
3,287 $
131
3,418 $
2022
13,471
(2,818)
(187)
10,466
(680)
—
9,786
2022
(2,818)
104
(2,714)
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
123
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
14. Property and equipment
2023
Land
Buildings
Leasehold
improvements
Equipment,
trucks and
automotive
Furniture
and office
equipment
Total
Cost
Balance, December 31, 2022
$
2,788 $ 12,895 $
20,121 $ 103,462 $
3,137 $ 142,403
Acquisition (note 7)
Additions
Impairment
Disposals
—
—
—
(40)
—
616
—
—
64
442
2,841
11,819
(433)
(717)
—
18
547
—
524
15,823
(433)
(9,811)
(197)
(10,765)
Balance, December 31, 2023
2,748
13,511
21,876
105,912
3,505
147,552
Accumulated depreciation
Balance, December 31, 2022
Disposals
Depreciation expense
Balance, December 31, 2023
—
—
—
—
7,680
—
434
8,114
10,769
66,288
2,195
86,932
(712)
(8,207)
(170)
(9,089)
2,233
12,290
10,442
68,523
277
2,302
13,386
91,229
Net book value
$
2,748 $
5,397 $
9,586 $
37,389 $
1,203 $ 56,323
2022
Land
Buildings
Leasehold
improvements
Equipment,
trucks and
automotive
Furniture
and office
equipment
Total
Cost
Balance, December 31, 2021
$
2,352 $
12,685 $
17,282 $
98,695 $
3,184 $ 134,198
Reclassified from held for sale
Additions
Disposals
436
—
—
—
210
—
—
—
2,864
13,555
—
188
436
16,817
(25)
(8,788)
(235)
(9,048)
Balance, December 31, 2022
2,788
12,895
20,121
103,462
3,137
142,403
Accumulated depreciation
Balance, December 31, 2021
Disposals
Depreciation expense
Balance, December 31, 2022
—
—
—
—
7,210
—
470
7,680
8,452
61,342
2,190
79,194
(9)
(6,425)
(229)
(6,663)
2,326
10,769
11,371
66,288
234
2,195
14,401
86,932
Net book value
$
2,788 $
5,215 $
9,352 $
37,174 $
942 $ 55,471
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
124
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
15. Right-of-use assets
2023
Buildings
Equipment,
trucks and
automotive
Furniture and
office
equipment
Cost
Balance, December 31, 2022
$
51,068 $
54,542 $
1,856 $
Acquisition (note 7)
Additions
Impairment
Disposals
Balance, December 31, 2023
Accumulated depreciation
Balance, December 31, 2022
Disposals
Depreciation expense
Balance, December 31, 2023
1,551
9,068
(997)
(5,779)
54,911
18,520
(5,457)
6,618
19,681
852
15,200
—
(3,822)
66,772
21,219
(3,190)
9,901
27,930
Total
107,466
2,414
24,268
(997)
(9,601)
11
—
—
—
1,867
123,550
1,591
—
234
1,825
41,330
(8,647)
16,753
49,436
Net book value
$
35,230 $
38,842 $
42 $
74,114
2022
Buildings
Equipment,
trucks and
automotive
Furniture and
office
equipment
Cost
Balance, December 31, 2021
$
43,393 $
51,441 $
1,848 $
Total
96,682
15,045
(4,261)
8,453
(778)
51,068
6,584
(3,483)
54,542
8
—
1,856
107,466
11,963
—
6,557
18,520
16,257
(3,228)
8,190
21,219
965
—
626
1,591
29,185
(3,228)
15,373
41,330
Additions
Disposals
Balance, December 31, 2022
Accumulated depreciation
Balance, December 31, 2021
Disposals
Depreciation expense
Balance, December 31, 2022
Net book value
$
32,548 $
33,323 $
265 $
66,136
During the second quarter of 2023, the Company conducted a process to rationalize its leased office space,
including office locations added through recent acquisitions. As a result of the process, certain leased
premises were no longer expected to be utilized in the future. Accordingly, a number of asset impairments
and onerous cost provisions were recorded, and reflected in the statement of income as acquisition and
integration costs in general and administrative expenses.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
125
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
16. Intangible assets
Trade
names
Backlog
Customer
relationships
Computer
software
Total
2023
Cost
Balance, December 31, 2022
$
8,000 $
4,500 $
15,500 $
27,565 $
55,565
Acquisition (note 7)
Additions
Disposals
—
—
—
304
—
—
2,207
—
—
Balance, December 31, 2023
8,000
4,804
17,707
Accumulated amortization
Balance, December 31, 2022
Amortization expense
Disposals
Balance, December 31, 2023
267
200
—
467
3,499
1,305
—
4,804
4,431
2,537
—
6,968
6
15,133
(1,018)
41,686
12,626
1,956
(1,018)
13,564
2,517
15,133
(1,018)
72,197
20,823
5,998
(1,018)
25,803
Net book value
$
7,533 $
— $
10,739 $
28,122 $
46,394
Trade
names
Backlog
Customer
relationships
Computer
software
2022
Cost
Balance, December 31, 2021
$
8,000 $
4,500 $
15,500 $
17,164 $
Additions
Disposals
—
—
—
—
—
—
10,949
(548)
Total
45,164
10,949
(548)
Balance, December 31, 2022
8,000
4,500
15,500
27,565 —
55,565
Accumulated amortization
Balance, December 31, 2021
Amortization expense
Disposals
Balance, December 31, 2022
67
200
—
267
1,790
1,709
—
3,499
2,189
2,242
—
4,431
10,640
2,514
(528)
12,626
14,686
6,665
(528)
20,823
Net book value
$
7,733 $
1,001 $
11,069 $
14,939 $
34,742
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
126
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
17. Goodwill
Cost
Balance, beginning of period
Acquisition (note 7)
Balance, end of period
Accumulated impairment
2023
$
69,891 $
252
70,143
2022
69,891
—
69,891
14,151
14,151
Net book value
$
55,992 $
55,740
At December 31, 2023 and 2022, the Company conducted an impairment test of its goodwill and indefinite
life intangible assets. The carrying value of goodwill and the Company’s indefinite life intangible assets at
December 31, 2023 and 2022 was determined to not be impaired as the recoverable amount of the
Company’s CGUs exceeded their carrying values.
For the purposes of impairment testing, the Company allocated the carrying value of goodwill to the
following groups of CGUs:
Industrial
Buildings
Infrastructure, Commercial Systems and Utilities
2023
22,595 $
12,794
20,603
55,992 $
$
$
2022
41,375
12,794
1,571
55,740
Key assumptions and sensitivity analysis
The recoverable amount of the CGUs were determined based on a value-in-use calculation using cash flow
projections from financial forecasts derived from the Company’s 2024 Business Plan, which was reviewed by
management with the Board of Directors, and the management estimates for 2025-2027.
The Company selected a four year forecast period for the discounted cash flow analysis with the belief that
further periods are adequately represented by a terminal value. Cash flows from growth opportunities are
probability-weighted and relate to initiatives management expects to progress on in the medium to long-
term time frame. These cash flows require assumptions to be made regarding the likelihood of projects
progressing and the future economics of those projects. Cash flows for the remaining periods were
extrapolated using a growth rate of 2.0%. An after-tax discount rate of 16.0%, which is based on a market-
based cost of capital, was applied in determining the recoverable amounts. The same discount rate has
been used in each of the CGUs, given the similarity in the business and the fact that business-specific risks
were adjusted for in the forecasted cash flows. In addition, entity-specific risks were separately factored into
each CGU forecast.
Sensitivity analyses of significant estimates and assumptions was conducted as part of the Company’s
impairment testing. The sensitivity ranges were selected based on management’s expectations for
inflationary growth and knowledge of weighted average cost of capital within the construction industry. A
1% change in the discount rate and a 0.5% change in the growth rate would not result in the carrying values
of the CGUs exceeding their recoverable amounts.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
127
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
18. Loans and borrowings
Loans and borrowings
Committed revolving credit facility
December 15, 2026 Variable
$
22,725 $
22,725
Maturity
Interest rate
2023
2022
Committed non-revolving term loan
facility
December 15, 2026 Variable
Equipment financing
2024 – 2028 Fixed 2.05%-6.45%
42,750
7,451
72,926
8,305
47,500
4,866
75,091
7,084
$
64,621 $
68,007
Current portion
Non-current portion
The following table provides details of the changes in the Company’s Loans and Borrowings for the Year
ended December 31, 2023:
Syndicated
committed
revolving credit
facility
Syndicated
committed
non-revolving
term loan facility
Equipment
financing
Balance, December 31, 2022
$
22,725 $
47,500 $
4,866 $
Net proceeds (repayment) of
draws for working capital
purposes
Proceeds
Repayments
—
—
—
Balance, December 31, 2023
$
22,725 $
—
—
(4,750)
42,750 $
—
5,103
(2,518)
7,451 $
Total
75,091
—
5,103
(7,268)
72,926
During the year ended December 31, 2023, the Company made short term draws on the revolving credit
facility to fund working capital. The aggregate of short term draws throughout the year totalled $85,000
with offsetting repayments totalling $85,000. (2022 -$50,000 draws and $50,000 repayments).
Syndicated credit facility
During the fourth quarter of 2023, the Company amended its syndicated credit facility (the “Syndicated
Facility”), adding additional capacity under the revolving and non-revolving credit facilities and extending
the maturity date to December 15, 2026. The Syndicated Facility is subject to a number of customary
covenants that are tested quarterly, including financial covenants such as a minimum Debt Service
Coverage Ratio, maximum Total Funded Debt to EBITDA Ratio, and maximum Direct Funded Debt to
EBITDA Ratio. The Company was in compliance with its covenants under each facility as at December 31,
2023. The Syndicated Facility is secured by a general interest in the assets of the Company and consists of
the following:
Committed revolving credit facility
The Company has a committed revolving credit facility of up to $250,000 (December 31, 2022 – $220,000)
that includes up to $30,000 swingline which allows the Company to enter into an overdraft position, and
$125,000 letters of credit availability. Borrowings under the facility bear interest at variable rates based on
the bank prime rate or Canadian benchmark rate plus a spread. A standby fee is payable quarterly on the
unutilized portion of the facility.
At December 31, 2023, the Company has $11,816 letters of credit outstanding on the facility (December 31,
2022 – $25,312) and has drawn $22,725 on the facility (December 31, 2022 – $22,725). The $22,725 drawn on
the facility is presented as non-current loans and borrowings on the Company's statement of financial
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
128
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
position as the amounts are not expected to be settled in the Company's normal operating cycle, and are
not due to be repaid until the maturity of the facility in 2026.
Committed non-revolving term loan facility
The Company has a committed non-revolving term loan facility totalling $47,500 which was fully drawn in a
prior year to finance the acquisitions of Stuart Olson and Dagmar in 2020 and 2021 respectively. The term
loan has scheduled repayments due quarterly until the maturity date of December 15, 2026. Any repayment
of the facility cannot be reborrowed. Borrowings under the facility bear interest at variable rates based on
the bank prime rate or Canadian benchmark rate plus a spread. As at December 31, 2023, the Company has
an outstanding balance of $42,750 on the facility (December 31, 2022 – $47,500).
The amended facility included an additional term loan availability of up to $14,000, available in a single
draw, to fund acquisitions. This facility was used subsequent to year end to fund $9,420 cash proceeds for
the NorCan acquisition (note 7). Any repayment of the term loan availability cannot be reborrowed.
Accordion
The Syndicated Facility includes a non-committed accordion feature allowing the Company to increase the
limit of the revolving credit facility and the non-revolving term debt facility up to an additional $50,000 in
aggregate. Any increases under the accordion require creditor approval before becoming available to the
Company.
Equipment financing
The Company has committed term credit facilities of up to $40,000 to be used to finance equipment
purchases of which as at December 31, 2023, $1,018 is outstanding (December 31, 2022 – $2,057).
Borrowings under the facilities are secured by a first charge against the equipment financed using the
facilities. Interest on the borrowings is charged at a fixed rate and is paid monthly in arrears.
The Company also has multiple, fixed interest rate, term loans which were used to finance equipment
purchases. At December 31, 2023, the balance outstanding on these term loans amounted to $6,433
(December 31, 2022 – $2,809). Principal and interest are payable monthly, and these term loans are secured
by a first charge against the specific equipment financed using these facilities.
Letters of credit facilities
Letters of credit represent performance guarantees issued to support the Company’s performance
obligations on major construction projects. The Company has authorized operating letters of credit
facilities totalling $150,000. At December 31, 2023, the facilities were drawn for outstanding letters of credit
of $38,853 (December 31, 2022 – $51,627). All letters of credit issued under these facilities are supported by
the pledge of Company-owned financial instruments, including cash, or through a guarantee from Export
Development Canada (“EDC”).
The Company has an agreement with EDC to provide performance security guarantees of up to $100,000
for letters of credit issued by financial institutions on behalf of the Company. The Company uses this facility
when letters of credit have been issued as contract security for projects that qualify for EDC coverage. At
December 31, 2023, EDC has issued performance security guarantees totalling $38,763 (December 31, 2022
– $51,537).
The remaining letters of credit are supported through the hypothecation of certain financial instruments
having a market value at December 31, 2023 of $90 (December 31, 2022 – $90).
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
129
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
19. Leases and right-of-use liabilities
The Company’s lease contracts are effective for periods of one to eleven years but may have extension
options.
The following table provides details of the changes in the Company’s ROU liabilities during the period
ended December 31, 2023:
Balance, beginning of period
Acquisition (note 7)
Additions
Interest
Lease terminations and modifications
Repayment
Balance, end of period
Current portion
Non-current
2023
$
73,259 $
2,414
23,855
3,130
(471)
(23,757)
78,430
$
20,750
57,680 $
2022
79,358
—
15,045
2,805
(1,397)
(22,552)
73,259
17,790
55,469
Potential undiscounted cash outflows of $60,723 (December 31, 2022 - $51,903) have not been included in
the measurement of the Company’s ROU liabilities as at December 31, 2023 because it is not reasonably
certain that particular leases will be extended. Included in the statement of income were expenses related
to short-term leases and leases of low-value assets amounting to $9,139 for the year ended December 31,
2023 (2022 - $7,774). Total cash outflows for leases for the year ended December 31, 2023 were $32,896
(2022 - $30,326).
The Company has established operating lease lines of credit of $25,000 with the financing arms of major
heavy equipment suppliers to finance equipment leases. Draws under these facilities are generally
recognized as ROU liabilities, with the lease obligations being secured by the specific leased equipment. At
December 31, 2023, the Company had used $7,999 (December 31, 2022 – $6,460) under these facilities.
20. Income taxes
Provision for income taxes
Income tax expense (recovery) comprised of:
Current income taxes
Deferred income taxes
Income tax rate reconciliation
Combined federal and provincial income tax rate
Increase (reductions) applicable to:
Non-taxable items
Other
Effective rate
2023
2022
$
$
14,563 $
7,129
21,692 $
2023
25.5%
0.3%
(2.5%)
23.3%
5,340
11,982
17,322
2022
25.6%
0.5%
(0.3%)
25.8%
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
130
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
The Company's statutory tax rate is the combined federal and provincial tax rates in the jurisdictions in
which the Company operates.
Composition of deferred income tax assets and liabilities
Provisions and accruals
Pension and other compensation
Timing of recognition of construction profits
Property and equipment
Right of use assets and liabilities and lease receivables
Intangible assets
Investment in equity accounted entities
Other
Tax loss carry forward
Presentation in the statement of financial position
Deferred income tax asset
Deferred income tax liability
$
2023
5,259 $
8,022
(29,184)
(12,606)
1,754
(3,413)
(1,595)
(3,752)
23,491
$
(12,024) $
28,935
(40,959)
(12,024) $
$
2022
4,675
4,620
(29,714)
(5,836)
2,372
(4,798)
(805)
(3,365)
28,659
(4,192)
31,564
(35,756)
(4,192)
The deferred tax asset balances recognized by the Company are supported by the reversal of existing
taxable temporary differences and expected future taxable income in excess of deductible temporary
differences.
2023
Balance,
December 31,
2022
Recognized
in profit or
loss
584 $
Recovery in
other
comprehensive
income
Acquisition
(note 7)
Balance,
December 31,
2023
5,259
— $
Provisions and accruals
$
4,675 $
Pension and other compensation
4,620
3,396
Timing of recognition of construction
profits
Property and equipment, including
software
ROU assets and liabilities
(29,714)
530
(5,836)
2,372
(6,733)
(618)
Intangible assets, excluding software
(4,798)
2,050
Investments in equity accounted
entities
Other
Tax loss carry forward
(805)
(3,365)
28,659
$
(4,192) $
(783)
(387)
(5,168)
(7,129) $
— $
6
—
—
—
—
(7)
—
—
(1) $
—
8,022
—
(29,184)
(37)
—
(665)
—
—
—
(702) $
(12,606)
1,754
(3,413)
(1,595)
(3,752)
23,491
(12,024)
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
131
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
2022
Provisions and accruals
Pension and other compensation
Timing of recognition of construction profits
Property and equipment, including software
ROU assets and liabilities
Intangible assets, excluding software
Investments in equity accounted entities
Other
Tax loss carry forward
21. Provisions
Balance, December 31, 2022
Provisions made during the period
Provisions used during the period
Provisions reversed during the period
Balance, December 31, 2023
Balance, December 31, 2021
Provisions made during the period
Provisions used during the period
Provisions reversed during the period
Balance, December 31, 2022
Balance,
December 31,
2021
5,255 $
Recognized
in profit or
loss
(580) $
$
Recovery in
other
comprehensive
income
Balance,
December 31,
2022
4,675
— $
7,658
(22,007)
(7,254)
3,342
(6,258)
(1,653)
(3,270)
(2,810)
(7,707)
1,418
(970)
1,460
816
(95)
32,173
(3,514)
(228)
—
—
—
—
32
—
—
$
7,986 $
(11,982) $
(196) $
Warranty claims
and other
$
10,254 $
8,277
(3,849)
(6,848)
Legal
8,289 $
943
(1,051)
(1,325)
$
$
7,834 $
6,856 $
Warranty claims
and other
16,426 $
13,566
(9,470)
(10,268)
Legal
10,890 $
2,205
(1,091)
(3,715)
$
10,254 $
8,289 $
4,620
(29,714)
(5,836)
2,372
(4,798)
(805)
(3,365)
28,659
(4,192)
Total
18,543
9,220
(4,900)
(8,173)
14,690
Total
27,316
15,771
(10,561)
(13,983)
18,543
Various claims and litigation arise in the normal course of the construction business. It is the Company's
opinion that an adequate provision has been made for any potential settlements relating to such matters
and that they will not materially affect the financial position or future operations of the Company.
Warranty claims and other provisions made in 2023 include $1,024 of onerous contract provisions resulting
from the Company's decision to optimize its leased office space, including leased premises added through
recent acquisitions.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
132
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
22. Other liabilities
Liabilities for cash-settled share-based compensation plans (note 24)
$
32,764 $
2023
Leasehold inducements
Acquisition holdback and other liability
Less: current portion
Cash-settled share-based compensation plans (note 24)
Leasehold inducements
Acquisition holdback and other liability
Current portion
Non-current portion
23. Pension obligations
1,075
300
34,139
9,729
268
—
9,997
2022
18,511
1,328
1,000
20,839
8,181
268
1,000
9,449
$
24,142 $
11,390
The Company maintains two registered pension plans covering salaried employees for two of its
subsidiaries. Each plan includes a defined contribution (“DC”) provision and a non-contributory defined
benefit ("DB") provision. During the first quarter of 2022, the Company commenced the process of winding
up one of the pension plans, which remains in process at December 31, 2023. In connection with the
winding up process, in 2022 a partial settlement of the plan occurred resulting in the derecognition of
obligations totalling $13,732, a settlement loss of $558 recorded in general and administrative expenses,
and $844 other comprehensive income related to changes in the asset ceiling.
DC pension plans
The total expense recognized in the statement of income during the year ended December 31, 2023 of
$479 (2022 - $583) represents contributions to these plans by the Company at rates specified in the rules of
the plans.
DB pension plans
Annual employer contributions to the DB provisions, determined by an independent actuary, meet
minimum amounts required by provincial pension supervisory authorities. The benefits provided by the DB
provisions of the pension plans are based on years of service and final average earnings of the employees
who are members of the plans.
Fair market value of plan assets
Equity securities
Fixed income allocation
Debt securities
Other return seeking investments
Cash and cash equivalents
2023
$
5,048 $
8,485
—
2,891
145
2022
5,092
7,744
—
2,711
720
$
16,569 $
16,267
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
133
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Reconciliation of amounts in the financial statements
Accrued benefit obligation
Balance, beginning of period
Employer current service cost
Interest cost on the defined benefit obligation
Benefit payments
Actuarial (gain) loss due to experience adjustments
Actuarial (gain) loss due to changes in financial assumptions
Settlements
Balance, end of period
Fair value of plan assets
Balance, beginning of period
Employer contributions
Interest income on plan assets
Actuarial gain (loss) on plan assets, excluding interest income
Benefit payments
Administration costs
Settlements
Balance, end of period
Recognized asset (liability) for defined benefit obligations
Asset ceiling
Balance, beginning of period
Interest on asset ceiling
Change in asset ceiling
Balance, end of period
2023
2022
$
15,899 $
37,339
152
755
(1,951)
(571)
1,640
83
$
16,007 $
230
906
(1,649)
93
(7,288)
(13,732)
15,899
2023
2022
$
16,267 $
37,928
604
778
1,044
(1,951)
(322)
149
16,569 $
2023
562 $
2023
— $
—
—
— $
981
909
(7,131)
(1,650)
(480)
(14,290)
16,267
2022
368
2022
821
23
(844)
—
$
$
$
$
During the period ended December 31, 2023, $385 (2022 – $1,289) was recorded in general and
administrative expenses in the statement of income, and a loss of $24 (2022 – gain of $908) before tax, was
recorded in other comprehensive income, relating to the DB plans. The loss relates to investment earnings
being less than the expected interest income on the plans' assets and changes in financial assumptions.
Actuarial assumptions
Discount rate on net benefit obligations
Rate of compensation increase
Inflation rate
2023
4.6 %
3.0 %
2.0 %
2022
5.1 %
3.0%
2.0%
The discount rate used to establish the pension obligation is based on AA-rated Canadian corporate bond
yields at the measurement date. A change of 100 basis points in the discount rate at the reporting date
would have increased or decreased the accrued benefit obligation by $1,994 (December 31, 2022 – $1,873).
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
134
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
24. Share-based compensation plans
Medium term incentive plan (“MTIP”), Equity incentive plan (“EIP”) and Deferred share unit (“DSU”)
plan
MTIP liability
EIP liability
DSU liability
Liabilities for cash-settled share-based compensation plans
Less: current portion
MTIP liability
EIP liability
DSU liability
Current portion
Non-current portion
$
2023
203 $
19,250
13,311
32,764
105
8,288
1,336
9,729
2022
1,168
8,975
8,368
18,511
1,168
4,707
2,306
8,181
$
23,035 $
10,330
MTIP
2023
EIP1
DSUs
MTIP
2022
EIP1
Units, beginning of period
Granted 2
188,906
1,712,974
1,030,552
809,213
1,398,029
43,720
865,153
187,254
47,980
735,192
Forfeited
Vested and paid
Units, end of period
(11,961)
—
—
(18,687)
—
(183,976)
(553,215)
(293,419)
(649,600)
(420,247)
36,689
2,024,912
924,387
188,906
1,712,974
1,030,552
DSUs
813,258
217,294
—
—
1 Based on underlying units before the impact of a performance multiplier, but after the effects of the dividend
adjustment ratio and the estimated forfeiture rate.
2 MTIP and DSU grants include dividend reinvestments.
The Company’s EIP provides certain officers and employees of the Company with the opportunity to be
granted PSUs or time-based RSUs. As at December 31, 2023, the Company had 1,012,456 outstanding RSUs
and 1,012,456 outstanding PSUs, before the impact of the performance multiplier (December 31, 2022 –
856,487 and 856,487units, respectively). The outstanding PSU balance as at December 31, 2023, adjusted
for the performance conditions that modify the vested value, is 1,277,184 units (December 31, 2022 –
956,192 units).
Compensation expense accrued for PSUs issued under the Company’s EIP is dependent on an adjustment
to the final number of PSUs that will vest based on a performance multiplier that is estimated by
management and approved by the Board of Directors. The performance multiplier applicable to the PSUs is
determined based on relative total shareholder return (“TSR”) and based on the achievement of earnings
before income tax compared to the Company’s business plan. The performance multiplier for achievement
of TSR is based on a comparison against TSR achieved in the performance period by comparative
companies. The range of the performance multiplier for the TSR and the achievement of earnings before
income tax is between zero to a maximum of 2.0, if the Company performs within the highest range of its
performance targets. RSU awards are set at a specific number of shares which are time-vested with no
performance multiplier.
During the first, second, third and fourth quarter of 2023, the Company granted 40,190, 41,390, 32,855 and
23,029 units under the DSU plan at a fair market value of $9.05, $8.20, $10.33 and $14.56 respectively,
excluding dividend reinvestments. The Company also granted 719,234 units under the EIP plan in March
2023 at a fair market value of $9.34, excluding dividend reinvestments.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
135
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
As at December 31, 2023, a total of 2,061,600 unvested phantom units of the MTIP and EIP (December 31,
2022 – 1,901,880) are outstanding and valued at $33,499 (December 31, 2022 - $16,253) of which $19,453 has
been recognized to date in the statement of income (2022 - $10,143).
Pursuant to the Company's MTIP granted in 2023, the units vest over periods ranging from November 2024
to November 2027. Payments pursuant to the Company's EIP granted in 2021, 2022 and 2023 vest on
December 2024, December 2025 and December 2026, respectively. Payments pursuant to the Company's
DSU Plan are cash settled no later than December 31 of the following year in which the Director ceases to
hold any position within the Company.
Expenses (recoveries) arising from share-based payment transactions1
MTIP
EIP
DSU
$
$
2023
1,222 $
16,343
8,214
25,779 $
2022
399
3,543
382
4,324
1 Expenses are before the effect of the TRS derivative contract.
The Company entered into a TRS derivative contract for the purpose of managing its exposure to changes
in the fair value of its MTIP, EIP and DSU share-based compensation plans, due to changes in the fair value
of the Company’s common shares. The Company recognized a gain of $13,945 on these derivatives in the
statement of income in general and administrative expenses for the year ended December 31, 2023 (2022
$1,946 loss).
25. Shareholders’ capital
The Company is authorized to issue an unlimited number of common shares. The Company is authorized to
issue unlimited preference shares, which can be issued in series with rights set by the Board of Directors. As
at December 31, 2023 and December 31, 2022, no preferred shares have been issued. During the year
ended December 31, 2023, transaction costs of $7 directly attributable to the issuance of common shares
for the acquisition of Trinity were recognized as a deduction from shareholders' capital (note 7).
2023
2022
Balance, beginning of period
Common shares issued (note 7)
Balance, end of period
Number of shares
53,695,293 $
79,346
53,774,639 $
Amount
114,584
681
115,265
Number of shares
53,695,293 $
—
53,695,293 $
Amount
114,584
—
114,584
26. Earnings per share
Net income
2023
$
71,539 $
2022
49,863
Weighted average number of common shares (basic and diluted)
53,767,900
53,695,293
Basic and diluted earnings per share
$
1.33 $
0.93
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
136
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
27. Finance and other income
Interest income on lease receivables
Gain on settlement of trade accounts receivable
Other interest income
Gain (loss) on warrants
$
$
2023
116 $
—
5,100
—
5,216 $
2022
151
7,596
3,497
(903)
10,341
In the prior year ended December 31, 2022, in connection with the settlement of historical construction
billings and interest charges with a customer, the Company recorded a gain of $7,596 and interest income
of $1,722. The construction billings were recorded and carried at fair value upon the acquisition of Stuart
Olson in 2020, and interest income included the reversal of expected credit losses recorded against interest
accrued subsequent to the acquisition. In connection with the settlement, the Company received warrants
which were classified as a derivative financial instrument measured at fair value, with subsequent changes in
fair value recognized through profit and loss in finance and other income.
28. Finance and other costs
Interest on loans and borrowings
Interest on ROU liabilities
Other
29. Personnel costs
Short-term employee benefits
Defined benefit and defined contribution plan expense (note 23)
Deferred compensation (note 24)
$
$
$
$
2023
8,864 $
3,130
1,164
13,158 $
2022 (note 36)
6,362
2,805
651
9,818
2023
805,139 $
864
25,779
831,782 $
2022
667,032
1,872
4,324
673,228
For the year ended December 31, 2023, personnel costs of $733,012 were included in costs of construction
(2022 – $594,518) and $98,770 in general and administrative expenses (2022 – $78,710). Short-term
employee benefits consist primarily of salaries and bonuses, as well as employee share purchase plan
(“ESPP”) expense and employee registered retirement savings plan (“RRSP”) matching contributions.
Deferred compensation consists of share-based compensation expenses.
30. Other cash flow information
Changes in non-cash working capital relating to operating activities
Accounts receivable
Contract assets
Inventory and prepaid expenses
Other assets
Accounts payable
Contract liabilities
Provisions
Deferred compensation plan expense and other
2023
2022 (note 36)
$
(137,295) $
(108,864)
(42,624)
(1,446)
124
66,160
59,356
(3,853)
4,024
$
(55,554) $
(989)
(979)
(92)
55,804
16,671
(8,773)
(12,095)
(59,317)
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
137
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Change in liabilities arising from financing activities
Balance, December 31, 2022
$
1,745
$
75,091
$
73,259
$
2023
Dividend
payable
Loans and
borrowings
ROU
liabilities
Acquisition (note 7)
Cash flows
Proceeds
Repayments
Dividends paid on shares
Non-cash changes
Net additions to ROU liabilities
Interest accretion
Dividends declared
—
—
—
(22,564)
—
—
22,744
—
2,414
5,103
(7,268)
—
—
—
—
—
(23,757)
—
23,384
3,130
—
Total
150,095
2,414
5,103
(31,025)
(22,564)
23,384
3,130
22,744
Balance, December 31, 2023
$
1,925
$
72,926
$
78,430
$
153,281
Balance, December 31, 2021
$
1,745
$
78,681
$
79,358
$
2022 (note 36)
Dividend
payable
Loans and
borrowings
ROU
liabilities
Cash flows
Proceeds
Repayments
Dividends paid on shares
Non-cash changes
Net additions to ROU liabilities
Interest accretion
Dividends declared
—
—
(20,941)
—
—
20,941
2,776
(6,366)
—
—
—
—
—
(22,552)
—
13,648
2,805
—
Total
159,784
2,776
(28,918)
(20,941)
13,648
2,805
20,941
Balance, December 31, 2022
$
1,745
$
75,091
$
73,259
$
150,095
31. Financial instruments
Carrying values and fair values
Determination of fair value and the resulting hierarchy requires the use of observable market data whenever
available. The classification of a financial instrument in the hierarchy is based upon the lowest level of input
that is significant to the measurement of fair value.
The hierarchy of inputs is summarized below:
i. Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;
ii. Level 2 - inputs other than quoted prices included in level 1 that are observable for the asset or
liability, either directly or indirectly; and
iii. Level 3 - inputs used in a valuation technique are not based on observable market data in
determining fair values of the instruments.
The Company’s TRS derivative contract (note 11) and warrants are classified as Level 2 measurements in the
fair value hierarchy. The Company does not have any financial instruments classified as Level 3 that are
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
138
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
carried at fair value. There were no transfers between levels in the fair value hierarchy during the years
ended ended December 31, 2023 and 2022.
The fair value of the Company’s loans and borrowings approximate their carrying values on a discounted
cash flow basis as the majority of these obligations bear interest at market rates. The fair values of the
remaining financial instruments approximate their carrying value due to their relatively short periods to
maturity.
Financial risk management
In the normal course of business, the Company is exposed to several risks related to financial instruments
that can affect its operating performance. These risks and the actions taken to manage them are as follows:
i. Credit risk
Credit risk relates to the risk of financial loss to the Company if a customer or counterparty to a financial
instrument fails to meet their contractual obligation.
With respect to accounts receivable, concentration of credit risk is limited due to the geographic
dispersion of revenues and a diversified customer base. Before entering into any construction contract
and during the course of the construction project, the Company satisfies itself that the customer has
adequate resources to fulfil its contractual payment obligations as construction work is completed. If a
customer was unable or unwilling to pay the amount owing, the Company will generally have a right to
register a lien against the project that will normally provide some security that the amount owed would
be realized.
A significant customer is one that represents 10% or more of contract revenue earned during the year.
For the year ended December 31, 2023, no customer accounted for 10% or more of the contract
revenue (2022 - nil).
Short-term deposits and short-term investments, if any, are subject to minimal credit risk as they are
placed with only major Canadian financial institutions. As is reasonably practical, these investments are
placed with several different Canadian financial institutions, thereby reducing the Company’s exposure
to a default by any one financial institution.
At December 31, 2023, accounts receivable outstanding for greater than 90 days and considered past
due by the Company represent 12.7% (December 31, 2022 – 16.6%) of the balance of progress billings
on construction contracts receivable. The Company has recorded an allowance of $345 (December 31,
2022 – $1,632) against these past due receivables, net of amounts recoverable from others.
Trade receivables
Impairment
Total Trade receivables
ii.
Liquidity risk
Amounts past due
Up to 12
months
Over 12
months
43,429
$
28,194
$
—
(345)
2023
71,623
(345)
$
2022
76,298
(1,632)
43,429
$
27,849
$
71,278
$
74,666
$
$
Liquidity risk relates to the risk that the Company will not be able to meet its financial obligations as
they become due. The Company manages this risk through management of its capital structure,
monitoring and reviewing actual and forecasted cash flows and the effect on bank covenants, and
maintaining unused credit facilities where possible to ensure there are available cash resources to meet
the Company’s liquidity needs. In managing liquidity risk, the Company has access to committed short
and long-term debt facilities as well as equity markets, the availability of which is dependent on market
conditions.
The Company has working capital of $234,010 (December 31, 2022 – $184,632) which is available to
support surety requirements related to construction projects. Working capital is calculated as total
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
139
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
current assets less total current liabilities. As a component of working capital, the Company maintains
significant balances of cash and cash equivalents. These balances, less $90 hypothecated to support
outstanding letters of credit and $35,026 held in restricted trust accounts, are available to meet the
general financial obligations of the Company as they become due. Restricted cash in trust is held in
segregated accounts for payment obligations on certain projects. Refer to note 18 in respect of the
Syndicated facility and the Company’s other debt instruments, which further improve the Company’s
access to liquidity. At December 31, 2023, the Company had a total undrawn balance on its committed
revolving credit facility of $215,459 (December 31, 2022 – $171,963). Also, the Company has a non-
committed accordion of up to an additional $50,000 to increase the limit of the committed revolving
credit facility and the committed non-revolving term debt facility. The Company also has committed
term credit facilities of up to $40,000 to be used to finance equipment purchases of which $38,982 is
undrawn as at December 31, 2023 (December 31, 2022 – $37,943). The Company believes that it has
access to sufficient funding through the use of these facilities and its cash and cash equivalents to meet
its foreseeable operating requirements.
The following are the contractual obligations,
interest payments, as at
December 31, 2023, in respect of the financial obligations of the Company, Interest payments on the
committed revolving credit facility and committed non-revolving term loan facility are not included in
the table below since they are subject to variability based upon outstanding balances at various points
throughout the period and variable interest rates.
including estimated
Carrying
amount
Contractual
cash flows
Not later
than 1
year
2 – 3
years
4 – 5
years
Later
than 5
years
Trade payables
Dividends payable
ROU liabilities
Committed revolving credit
facility
Committed non-revolving
term loan
Equipment financing
Acquisition holdback and
other liability (note 7)
iii. Market risk
$ 639,963 $ 639,963 $ 591,577 $ 48,345 $
41 $
1,925
78,430
22,725
1,925
87,483
22,725
1,925
—
—
23,975
35,157
15,641
12,710
—
22,725
42,750
42,750
5,938
36,812
7,451
300
8,212
300
2,717
—
4,167
300
1,328
—
—
—
—
—
—
—
—
—
$ 793,544 $ 803,358 $ 626,132 $ 147,506 $ 17,010 $ 12,710
Market risk is the risk that changes in market prices, such as interest rates, equity prices and corporate
bond yields, will affect the Company’s income or the value of its holdings in liquid securities. The
discount rate used to establish the pension obligation was determined by reference to market interest
rates on AA-rated corporate bonds with cash flows that approximate the timing and amount of
expected benefit payments.
The interest rate profile of the Company's loans and borrowings was as follows:
Fixed-rate facilities
Variable-rate facilities
Total loans and borrowings
$
$
2023
7,451 $
65,475
72,926 $
2022
4,866
70,225
75,091
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The Company is exposed to interest rate risk to the extent
that its credit facilities and TRS derivatives are based on variable rates of interest.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
140
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
At December 31, 2023, a one percent change in the interest rate applied to the Company's variable
rate long-term debt would change annual income before income taxes by approximately $655 (2022 –
$702).
The Company has certain share-based compensation plans, where the values are based on the
common share price of the Company. At December 31, 2023, a 10 percent change in the share price
applied to the Company's share based compensation plans would change income before income taxes
by approximately $3,276 (2022 – $1,352).
The Company has fixed a portion of the settlement costs of these plans by entering into a TRS
derivative contract maturing in 2024. The TRS derivative is not designated as a hedge. The change in
the value of the TRS derivative is recorded each quarter based on the difference between the notional
price and the market price of the Company’s common shares at the end of each quarter. The TRS
derivative is classified as derivative financial instrument. At December 31, 2023, a 10 percent change in
the share price applied to the Company's TRS derivative would change the fair value of the derivative
by approximately $3,036 (2022 – $1,640), with a corresponding impact to income before income taxes.
iv. Currency risk
Currency risk is the risk that fluctuations in currency exchange rates will affect the Company’s net
income. The Company uses foreign currency to settle payments to vendors and subcontractors in the
foreign currency. Foreign currency risk is managed by the Company through the use of foreign currency
derivatives. At December 31, 2023, a 10 percent movement in the Canadian and U.S. dollar exchange
rate would have changed the carrying value of U.S. dollar denominated assets and liabilities by
approximately $127 (2022 – $233), with a corresponding impact to income before income taxes.
32. Capital management
The Company’s capital management objectives are to:
i. ensure that the Company has the financial capacity and liquidity to achieve its strategic objectives and
support its current and anticipated volume and mix of business consistent with the risk tolerance of
the Company;
ii. have the financial flexibility to absorb the seasonality and cyclicality of the Company's operations and
the construction industry, as well as unforeseen events with an appropriate level of investment in
working capital and available committed credit capacity;
iii. pursue a balanced capital allocation strategy that will deliver superior shareholder value;
iv. generate sufficient cash flow to maintain and grow the dividend in a consistent and sustainable way as
determined by the Board of Directors; and
v. provide investors with maximum risk-adjusted long-term returns on equity.
In the management of capital, the Company defines capital as the aggregate of its shareholders’ equity and
non-current loans and borrowings.
The Company manages its capital within a capital management policy approved by the Board of Directors.
The Company adjusts its capital structure in light of changes in economic conditions. In order to maintain or
adjust its capital structure, the Company may issue new debt or repay existing debt, issue share capital,
issue convertible debt, adjust capital expenditures, or may adjust the amount of dividends paid to
shareholders. Financing decisions are generally made on a specific transaction basis and depend on such
things as the Company’s needs, capital markets and economic conditions at the time of the transaction.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
141
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
The Company monitors its capital on a number of bases; the amounts of working capital, non-current loans
and borrowings and shareholders’ equity are as follows:
Working capital
Loans and borrowings – non current
Shareholders’ equity
33. Commitments and contingencies
Commitments
2023
234,010 $
64,621 $
322,494 $
$
$
$
2022
184,632
68,007
272,988
Outstanding surety lien bonds issued on behalf of the Company in connection with liens by subcontractors
and suppliers at December 31, 2023 totalled $98,335 (December 31, 2022 – $87,787). The Company has
acquired minority equity interests in a number of PPP concession entities (note 13), which require the
Company to make $1,816 in future capital injections. These commitments have been secured by letters of
credit totalling $1,816 (December 31, 2022 – $1,816).
During the year ended December 31, 2023, the Company signed orders with a fleet management provider
for leases totalling $5,287 that have not been recognized in the statement of financial position. The leases
are expected to commence and be recognized in the statement of financial position within the next 12
months.
At December 31, 2023, the Company has minimum payments under contracts for other purchase
obligations that are not recognized as liabilities in the statement of financial position of $6,094 due within
the next 12 months, $7,659 from 1 to 3 years, and $4,349 from 3 to 5 years.
Contingencies
The Company is contingently liable for the usual contractor’s obligations relating to performance and
completion of construction contracts. These include the Company’s contingent liability for the performance
obligations of its subcontractors. Where possible and appropriate, the Company obtains performance
bonds, subcontract/supplier insurance or alternative security from subcontractors. However, where this is
not possible, the Company is exposed to the risk that subcontractors will fail to meet their performance
obligations. In that eventuality, the Company would be obliged to complete the subcontractor’s contract,
generally by engaging another subcontractor, and the cost of completing the work could exceed the
original subcontract price. The Company makes appropriate provision in the financial statements for all
known liabilities relating to subcontractor defaults.
34. Related party transactions
Balances and transactions between the Company and its subsidiaries, which are related parties, have been
eliminated on consolidation. Each of the related party transactions described below was made on terms
equivalent to those that prevail in arm’s length transactions unless otherwise noted.
Compensation of key management personnel represents the aggregate amounts paid and accrued to the
Company’s key management personnel and the Company’s Board of Directors.
Short-term benefits
Share-based compensation
$
$
2023
7,812 $
16,513
24,325 $
2022
5,889
2,319
8,208
A Director or related parties hold positions in other entities that result in them having control over the
financial reporting or operating policies of those entities. The aggregate value of transactions during the
year with entities over which Directors have control was $3,200 (2022 - $1,037) and the outstanding balance
receivable, including holdbacks receivable, at December 31, 2023 was $3,275 (December 31, 2022 - $571).
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
142
Bird Construction Inc.
Notes to the Consolidated Financial Statements
For the years ended December 31, 2023 and 2022
(in thousands of Canadian dollars, except per share amounts)
Transactions with proportionally consolidated joint arrangements
The Company provides services of its employees, management services, cost reimbursements, parental
guarantees and letters of credit to the joint arrangements. These services were transferred at the exchange
amount, agreed to between the parties. The amounts recognized for services provided by the Company for
the year ended December 31, 2023 totalled $36,943 (2022 - $34,979).
The Company has accounts receivable from the joint arrangements at December 31, 2023 totalling $5,466
(December 31, 2022 - $5,017).
Transactions with equity accounted joint arrangements
The Company and its proportionately consolidated joint arrangements (note 4), provide development and
construction services to its concession investments in associates and joint ventures which are in the normal
course of business and on commercial terms. The Company’s proportionate share of the amounts billed for
construction services provided by these joint arrangements for the year ended December 31, 2023 totalled
$172,495 (2022 – $57,607), and $182,649 has been recognized in revenue in 2023 (2022 - $53,093). The
Company’s proportionate share of payments made to the joint arrangements for the year ended
December 31, 2023 totalled $2,595 (2022 - $580). These amounts are not eliminated as they are deemed to
be realized by the Company.
The Company and its proportionately consolidated joint arrangements have accounts receivable from these
investment entities. The Company’s proportionate share of accounts receivable at
concession
December 31, 2023 totalled $51,772 (December 31, 2022 - $24,378).
35. Subsequent events
Eligible dividends declared with a record date subsequent to the financial statement date:
As of the date of the approval of these financial statements, the Board of Directors has declared eligible
dividends with a record date subsequent to the date of the financial statements, for the following months:
Eligible dividends declared
January dividend
February dividend
March dividend
April dividend
Business acquisition:
Record date
January 31, 2024
February 29, 2024
March 28, 2024
April 30, 2024
Payment date
February 20, 2024
March 20, 2024
April 19, 2024
May 17, 2024
Dividend per share
$0.0358
$0.0358
$0.0467
$0.0467
Subsequent to the year end, the Company acquired the assets of NorCan Electric Inc. ("NorCan") a leading
electrical and instrumentation service provider in Alberta. The total consideration for the transaction was
$11,113, which was funded through a combination of debt of $9,420 and the Company's common shares of
$1,693. See Note 7.
36. Comparative figures
Certain comparative figures for the prior period have been reclassified to conform to the presentation
adopted in the current period. There was no resultant impact on net income, comprehensive income, cash
flow, or financial position of the Company from the reclassifications.
BIRD CONSTRUCTION INC.
ANNUAL 2023 CONSOLIDATED FINANCIAL STATEMENTS
143
CORPORATE OFFICES
Mississauga
Suite 400, 5700 Explorer Drive,
Mississauga, ON L4W 0C6
Calgary
Suite 600 , 4820 Richard Road SW
Calgary, AB T3E 6L1
DIRECTORS
J. Richard Bird, Ph.D., MBA
Calgary, AB
Karyn A. Brooks, FCPA, FCA(1)
Calgary, AB
Steven L. Edwards
Kansas City, MO
J. Kim Fennell
Los Gatos, CA
Jennifer Koury, ICD.D(2)
Calgary, AB
Terrance L. McKibbon
Canmore, AB
Gary Merasty
Saskatoon, SK
Luc J. Messier, P.Eng.(3)
Houston, TX
Paul R. Raboud, P.Eng., MSc, MBA (Chair), ICD.D
Toronto, ON
Arni C. Thorsteinson, C.F.A., D.M., LLD
Winnipeg, MB
(1) Audit Committee Chair
(2) Human Resources & Governance Committee Chair
(3) Health, Safety & Environment Committee Chair
STOCK EXCHANGE
LISTING
Toronto Stock
Exchange
(Symbol “BDT”)
TRANSFER AGENT
AND REGISTRAR
Computershare
Investor Services
AUDITORS
KPMG LLP
LEAD BANK
Bank of
Montreal
SURETY
Travelers Guarantee
Company of Canada
WEBSITE
www.bird.ca
SENIOR LEADERSHIP
Terrance L. McKibbon
President & Chief Executive Officer
Wayne R. Gingrich, CPA, CMA, ICD.D
Chief Financial Officer & Treasurer
Gilles G. Royer, P.Eng.
Chief Operating Officer
Charles J. Caza, BA. Sc. Eng., LL.B.
Executive Vice President & Chief Legal Officer
Brian C. Henry
Chief People Officer
Rick Begg
Chief Information Officer
Peter Lineen
Executive Vice President, Health,
Safety & Environment
J. Paul Bergman, CET
Executive Vice President, Buildings East
Rob Otway, P.Eng., GSC, ICD.D
Executive Vice President, Buildings West
Tannis Proulx, P.Eng.
Executive Vice President, Industrial Construction
David Keep
Executive Vice President, MRO and Commercial Systems
Adham Kaddoura
Senior Vice President
Matt Cronin
Senior Vice President, Industrial East
Denis Bigioni
President, Dagmar Construction Inc.
Frank DeLuca, P.Eng.
Senior Vice President, Client Solutions
Arthur Krehut
Senior Vice President, Operational Services
John Wright
Senior Vice President, Strategic Development
Paul Pastirik, CPA, MBA
Senior Vice President, Strategic Development
144
ANNUAL REPORT 2023
ANNUAL REPORT 2023
55
LOCATIONS FROM COAST TO COAST
CORPORATE OFFICES
Mississauga
Suite 400, 5700 Explorer Drive,
Mississauga, ON L4W 0C6
T: 905.602.4122
Calgary
Suite 600, 4820 Richard Road SW
Calgary, AB T3E 6L1
T: 403.685.7777
BRITISH COLUMBIA
Kelowna
Suite 200, 1626 Richter Street
Kelowna, BC V1Y 2M3
T: 236.361.0477
Vancouver
#300, 13777 Commerce
Parkway Richmond, BC V6V 2X3
T: 604.271.4600
F: 604.271.1850
ALBERTA
Edmonton
17007, 107 Avenue NW
Edmonton, AB T5S 1G3
T: 780.452.8770
F: 780.455.2807
Edmonton
201, 2627 Ellwood Drive SW
Edmonton, AB T6X 0P7
Industrial T: 780.481.9600
Buildings T: 780.452.4260
Fort McMurray
Bay 45, 925 Memorial Drive
Fort McMurray, AB T9K 0K4
T: 780.790.3424
Red Deer
102, 8024 Edgar Industrial Crescent
Red Deer, AB T4P 3R3
T: 403.342.1666
Thunder Bay
946 Cobalt Crescent, Unit 1
Thunder Bay, ON P7B 5W3
T: 807.768.9753
SASKATCHEWAN
Regina
225B Helen Dr,
Regina, SK, S4K 0A3
T: 306.565.3120
T: 306.565.3845
MANITOBA
Winnipeg
1055 Erin Street,
Winnipeg, MB R3G 2X1
T: 204.775.7141
F: 204.783.8119
ONTARIO
Toronto
Suite 400, 5700 Explorer Drive,
Mississauga, ON L4W 0C6
T: 905.602.4122
F: 905.602.6319
Ottawa
1600 Carling Avenue
Suite 200,
Ottawa, ON K1Z 1G3
T: 613-912-7738
Sudbury
670 Falconbridge Road, Unit 1
Sudbury, ON P3A 4S4
T: 705.222.4848
QUEBEC
Montreal
1868 Boul. Des Sources,
Suite 200
Pointe-Claire, QC H9R 5R2
T: 514.426.1333
F: 514.426.1339
NEW BRUNSWICK
Saint John
120 Millennium Drive,
Quispamsis, NB E2E 0C6
T: 506.849.2473
F: 506.847.0270
NOVA SCOTIA
Halifax
20 Duke Street, Suite 201
Bedford, NS B4A 2Z5
T: 902.835.8205
F: 902.835.8245
NEWFOUNDLAND
AND LABRADOR
St. John’s
141 Kelsey Drive, Suite 100
St. John’s, NL A1B 0L2
T: 709.726.9095
F: 709.726.9106
Wabush
2 Old Airport Road,
Wabush, NL A0R 1B0
T: 709.282.5633
F: 709.282.3500
54
ANNUAL REPORT 2023
ANNUAL REPORT 2023
145
ANNUAL REPORT 2023
Bird Construction Inc.
5700 Explorer Drive, Suite 400
Mississauga, ON L4W 0C6
Tel: (905) 602-4122
www.bird.ca