WESTSHORE TERMINALS
INVESTMENT CORPORATION
ANNUAL REPORT
2024
estshore Terminals Investment Corporation (the “Corporation”) owns all of the
limited partnership units of Westshore Terminals Limited Partnership, a
partnership established under the laws of British Columbia (“Westshore”). It derives its cash
inflows from its investment in Westshore by way of distributions on its limited partnership
units. Westshore operates the coal storage and loading terminal at Roberts Bank, British
Columbia (the “Terminal”), which is the largest coal loading facility on the west coast of the
Americas. The principal office of the entities is located at 1800 - 1067 West Cordova Street,
Vancouver, British Columbia, V6C 1C7.
Table of Contents
Financial Highlights
2
Directors' Letter and Report to Shareholders
3
Management's Discussion and Analysis
4
Consolidated Financial Statements
21
Corporate Information
49
W
2
Financial Highlights
(In thousands of Canadian dollars except tonnage and share amounts)
2024
2023
Tonnage (in thousands)
26,763
27,728
Coal loading revenue
$
368,212
$
360,392
Profit before taxes
$
157,967
$
159,730
Profit for the year
$
115,252
$
116,555
Profit for the year per share
$
1.86
$
1.86
Dividends declared
$
114,839
$
87,520
Dividends declared per share
$
1.85
$
1.40
Funds applied to repurchase shares
$
17,656
$
7,582
Average price paid per repurchased share
$
23.70
$
24.09
Shares outstanding at December 31
61,769,766
62,514,675
Share Trading Statistics
High
$
29.08
$
33.72
Low
$
21.93
$
22.45
Close
$
22.53
$
27.42
Annual Volume
20,113,155
21,026,600
Westshore Terminals Investment Corporation
Directors’ Letter and Report to Shareholders
3
Dear Shareholder:
Westshore shipped volumes for 2024 were 26.8 million tonnes compared to 27.7 million tonnes in 2023. Inclement
weather and some unplanned maintenance issues in Q4 resulted in our throughput volume being short of the most recent
forecast of 27.5 million tonnes. The average loading rate charged to customers for 2024 was $13.76 per tonne. Keeping
in mind the operational challenges throughout the year due to the level of construction activity and associated impacts to
equipment access and available coal storage capacity, 26.8 million is a very solid result, and like the 2023 results,
significantly higher than initial forecasts.
Based on our current forecast, volumes for 2025 are expected to be approximately 26.5 million tonnes at an average
rate of $13.55 for the year.
Total revenues in 2024 of $404.7 million compares to 2023 revenues of $381.0 million. In 2024, total revenues included
$36.5 million of other revenues (compared to $20.6 million in 2023) primarily due to a reservation fee of $21.3 million
that was brought into income in Q4 2024. Profit before taxes of $158.0 million was down slightly from $159.7 million in
2023, and after-tax profit per share of $1.86 was the same as 2023.
We have made significant progress on the potash project in 2024, and since commencement of the project to the end
of 2024 we have spent $545 million, which is being reimbursed by BHP, subject to the 5% holdback. In 2024 we
completed all of the seismic upgrades and a majority of the in-ground services and made significant progress on the civil
works relating to the potash project and construction of the potash storage building and potash dumper. The project
budget is challenged with higher than anticipated inflation, and delays in completion of outsourced design engineering
which will result in increased labour and other costs to maintain the tight project schedule. Our expected capital
contribution to the project (BHP is funding approximately $1 billion) is approximately $225 million. The Corporation has
the financial capacity to pay for its contribution. The project is on schedule to complete in 2026 and we anticipate
meaningful revenue for potash handling to commence in 2027.
In the first quarter of 2024 we amended our lease with Vancouver Fraser Port Authority. The amended lease
accommodates the expansion of Westshore’s operations to include handling potash and has an initial term running until
the end of 2051 with options to renew until 2070.
The Corporation renewed its normal course issuer bid (“NCIB”) effective April 15, 2024 for another year, allowing it
to acquire up to 3,310,738 common shares until April 14, 2025. During 2024, 744,909 common shares were purchased
for a total of $17.7 million. In 2023, 314,784 common shares were purchased for a total of $7.6 million.
The Corporation increased its regular quarterly dividends to shareholders in March 2024, from $0.35/share to
$0.375/share.
Our annual ESG (Environmental, Social, and Governance) report for 2024 will be available on the Corporation’s
website in conjunction with this report.
For the Board of Directors,
(Signed) “William Stinson”
William Stinson
Chairman of the Board of Directors
Vancouver, B.C.
March 14, 2025
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
4
The following discussion and analysis should be read in conjunction with information contained in the Consolidated
Financial Statements of Westshore Terminals Investment Corporation (“the Corporation”) and the notes thereto for
the year ended December 31, 2024. This discussion and analysis has been based upon the consolidated financial
statements prepared in accordance with IFRS Accounting Standards. This discussion and analysis is the responsibility
of management of the Corporation. Additional information and disclosure can be found on SEDAR+ at
https://www.sedarplus.ca. Unless otherwise indicated, the information presented in this Management’s Discussion and
Analysis (“MD&A”) is stated as at March 14, 2025.
All amounts are presented in Canadian dollars unless otherwise noted.
Caution Concerning Forward-Looking Statements
This MD&A contains certain forward-looking statements, which reflect the current expectations of the Corporation and Westshore with
respect to future events and performance. Forward-looking statements are based on information available at the time they are made,
assumptions by management, and management’s good faith belief with respect to future events. They speak only as of the date of this MD&A,
and are subject to inherent risks and uncertainties, including those risk factors outlined in the Annual Information Form of the Corporation
filed on https://www.sedarplus.ca, that could cause actual performance or results to differ materially from those reflected in the forward-
looking statements, historical results or current expectations.
Forward-looking information included in this document includes: statements regarding Westshore’s future revenues and the impacts
thereon, including anticipated throughput volumes and loading rates, distribution of throughput by customer, the US/CDN dollar exchange
rate, anticipated rail performance, and the impact of construction activity at Westshore; statements regarding Westshore’s potash project,
including the timing of payment and amount of Westshore’s capital contribution to the project, Westshore’s ability to fund and the sources of
funding for Westshore’s capital contribution to the project, the project schedule and expected completion date, and timing of meaningful revenue
from handling potash; Westshore continuing to meet annual operating and capital requirements and payment of the dividend and managing
variations in working capital without any need for financing except for material capital improvements; the absence of liquidity concerns with
respect to the ongoing operations of Westshore; ability to extend its credit facility when it matures; assumptions in connection with critical
accounting estimates; and share repurchases.
Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate
indications of whether, or the times at which, such performance or results will be achieved. There is significant risk that estimates, predictions,
forecasts, conclusions and projections will not prove to be accurate, that assumptions may not be correct and that actual results may differ
materially from such estimates, predictions, forecasts, conclusions or projections. Readers of this MD&A should not place undue reliance on
forward-looking statements as a number of risk factors could cause actual results, conditions, actions or events to differ materially from the
targets, expectations, estimates or intentions expressed in the forward-looking statements. Specific risk factors include, among others:
Westshore’s dependence on coal shipments, which are in turn affected by global demand and competition in the supply of seaborne coal, the
ability of customers to maintain or increase sales or deliver coal to the Terminal and fluctuations in exchange rates; fluctuation in inflation
rates; Westshore’s ability to renegotiate key customer contracts in the future on favourable terms or at all; global changes in climate change
initiatives and environmental regulations and policies; and risks related to the construction and operation of the potash project, including cost
overruns and delays. See risk factors outlined in the Annual Information Form referred to above.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
5
General
Westshore Terminals Investment Corporation (the “Corporation”) was incorporated under the Business
Corporations Act (British Columbia) on September 28, 2010 and is domiciled in Canada. The registered and head office
of the Corporation is located at Suite 1800, 1067 West Cordova Street, Vancouver, British Columbia V6C 1C7. The
Corporation owns all of the limited partnership units of Westshore Terminals Limited Partnership (“Westshore”), a
limited partnership established under the laws of British Columbia.
The Corporation derives its cash inflows from its investment in Westshore by way of distributions on Westshore’s
limited partnership units. Westshore operates a coal storage and unloading/loading terminal at Roberts Bank, British
Columbia (the “Terminal”). Westshore’s operating revenues are derived from rates charged for loading coal onto
seagoing vessels. Westshore is currently undertaking significant infrastructure additions to the Terminal to allow it to
handle potash for BHP Canada Inc., a subsidiary of BHP Group Limited (“BHP”).
Westshore’s results are affected by various factors, including the volume of coal shipped by each customer, and their
contracted rate per tonne, as well as Westshore’s operating costs and capital expenditures.
This MD&A has been prepared by the Corporation to accompany the consolidated financial statements of the
Corporation for the financial year ended December 31, 2024.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
6
Structure
The following chart illustrates the Corporation’s primary structural relationships. The Corporation holds all of the
limited partnership units of Westshore and all of the common shares of Westshore Terminals Ltd. (the “General
Partner”), the general partner of Westshore. Westar Management Ltd. (the “Manager”) provides management services
to Westshore and administrative services to the Corporation and appoints three of the eight directors of the General
Partner. Details of these arrangements will be included in the Information Circular for the Corporation’s 2025 Annual
Meeting.
As of March 14, 2025, the Corporation had issued and outstanding 61,769,766 common shares.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
7
Selected Financial Information
The following financial data is derived from the Corporation’s audited consolidated financial statements for the years
ended December 31, 2024, 2023 and 2022, which were prepared in Canadian dollars using IFRS Accounting Standards.
(In thousands of Canadian dollars except per share amounts and where noted)
2024
2023
2022
$
$
$
Tonnage (000 tonnes)
26,763
27,728
23,340
Revenue
404,729
380,995
296,957
Profit before taxes
157,967
159,730
91,657
Profit for the year
115,252
116,555
66,838
Profit for the year per share(1)
1.86
1.86
1.06
Dividends declared
114,839
87,520
170,668
Dividends declared per share
1.85
1.40
2.70
Total assets
1,850,531
1,394,639
1,258,799
Total long term liabilities
913,920
519,558
467,317
(1) The weighted average number of Common Shares outstanding for 2024 was 62,082,433, for 2023 was 62,536,268, and for
2022 was 63,232,185.
The following tables set out selected consolidated financial information for the Corporation on a quarterly basis for
the last eight quarters.
(In thousands of Canadian dollars except per share amounts and
where noted)
Three Months Ended
Dec 31, 2024
Sep 30, 2024
Jun 30, 2024
Mar 31, 2024
$
$
$
$
Tonnage (000 tonnes)
6,279
7,179
7,291
6,014
Revenue
110,853
103,496
105,622
84,758
Profit before income tax
43,003
46,624
47,431
20,909
Profit for the period
31,375
34,021
34,611
15,245
Profit per share
0.51
0.55
0.56
0.24
Dividends declared
23,164
23,164
23,188
45,323
Dividends declared per share
0.375
0.375
0.375
0.725
Shares repurchased (000 shares)
-
66
679
-
Cost of shares repurchased
-
1,540
16,116
-
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
8
(In thousands of Canadian dollars except per share amounts and
Three Months Ended
Dec 31, 2023
Sep 30, 2023
Jun 30, 2023
Mar 31, 2023
$
$
$
$
Tonnage (000 tonnes)
6,733
7,397
6,685
6,913
Revenue
88,693
100,264
93,015
99,023
Profit before income tax
30,546
45,550
38,545
45,089
Profit for the period
22,282
33,240
28,135
32,898
Profit per share
0.36
0.53
0.45
0.53
Dividends declared
21,880
21,880
21,880
21,880
Dividends declared per share
0.35
0.35
0.35
0.35
Shares repurchased (000 shares)
-
-
-
315
Cost of shares repurchased
-
-
-
7,582
Summary Description of Business
General
Westshore operates a coal storage and loading facility at Roberts Bank, British Columbia that is the largest coal
loading facility in North America. Westshore receives handling charges from its customers for throughput volume.
Westshore does not take title to the coal it handles. Market conditions for both thermal and metallurgical coal affect the
competitiveness of Westshore’s customers and, therefore, may affect the volume of coal handled by Westshore.
Westshore has contracts to ship coal from mines in British Columbia, Alberta and the United States.
Coal is delivered to the Terminal in unit trains operated by Canadian Pacific Kansas City, BNSF Railway, and
Canadian National Railway. The product is unloaded and either directly loaded onto a ship or stockpiled for future ship
loading. The loaded ships are destined around the globe to approximately 14 different countries, with the largest volumes
being shipped to Japan and South Korea.
Westshore is currently undertaking significant infrastructure additions to the Terminal to allow it to handle potash
for BHP. These additions include a new potash dumper, storage building and associated conveying systems.
Additionally, certain existing infrastructure at the Terminal will be modified to support handling potash. Once
completed, potash will be loaded only at the Terminal’s Berth 2, which will continue to be available for loading coal.
The project is on schedule to complete in 2026, and we anticipate meaningful revenue for potash handling to commence
in 2027.
The Terminal is located on land leased from the Vancouver Fraser Port Authority (the “VFPA”). The term of our
lease runs to December 31, 2051, with Westshore having further options to extend the term to December 31, 2070.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
9
Markets & Customers
Shipments of coal through the Terminal by destination for the past three years were as follows:
Shipments by Destination
(Expressed in thousands of metric tonnes)
2024
2023
2022
Tonnes
%
Tonnes
%
Tonnes
%
Japan
10,676
40
13,360
48
11,572
50
South Korea
10,051
38
7,331
26
7,588
32
China and Hong Kong
3,776
14
3,650
13
1,045
4
India
663
2
477
2
696
3
Central and South America
581
2
1,030
4
923
4
Taiwan
533
2
865
3
344
1
Europe
174
1
770
3
613
3
Vietnam
172
1
222
1
130
1
Other
137
-
23
-
429
2
Total
26,763
100
27,728
100
23,340
100
During 2024, 66% of Westshore’s volume was thermal coal (64% in 2023), 33% was metallurgical coal (36% in 2023)
and 1% was petroleum coke (less than 1% in 2023).
Westshore operates under term contracts with its customers. In 2024, Westshore shipped product for seven different
customers. Current contracts with Westshore’s four largest customers, which in 2024 accounted for 95% of Westshore’s
throughput, have remaining terms of between two and four years.
Westshore has an agreement with BHP (the “BHP Agreement”) to provide port services to BHP’s Jansen Potash
Mine in Saskatchewan (the “Jansen Mine”). Pursuant to the BHP Agreement, Westshore is required to construct the
necessary infrastructure at the Terminal to enable it to handle potash. BHP is required to reimburse Westshore for
construction costs relating to the potash infrastructure additions up to the agreed budget of approximately $1 billion,
with Westshore being responsible for all costs in excess of the agreed budget. The BHP Agreement provides for a
shipping term running until 2051, which is subject to extension, minimum annual throughput and a fixed loading rate
that is indexed annually to changes in the CPI.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
10
Results of Operations
(In thousands of Canadian dollars)
Three Months Ended
Years Ended
December 31,
2024
December 31,
2023
December 31,
2024
December 31,
2023
$
$
$
$
Revenue:
Coal loading
86,416
85,495
368,212
360,392
Other
24,437
3,198
36,517
20,603
110,853
88,693
404,729
380,995
Expenses:
Operating
53,791
54,253
206,449
201,368
Administrative
5,379
3,649
18,456
17,283
59,170
57,902
224,905
218,651
Other:
Foreign exchange gain (loss)
(2,240)
671
(2,860)
1,697
Loss on disposal of property, plant and
equipment
(1,665)
-
(1,664)
(9)
Net finance costs
(4,775)
(916)
(17,333)
(4,302)
Profit before income tax
43,003
30,546
157,967
159,730
Income tax expense
11,628
8,264
42,715
43,175
Profit for the period
31,375
22,282
115,252
116,555
Other comprehensive income (loss), net of
income tax
10,916
(10,941)
13,588
(4,605)
Total comprehensive income for the
period
42,291
11,341
128,840
111,950
Quarterly analysis
Tonnage shipped for Q4 2024 was 6.3 million tonnes compared to 6.7 million tonnes for the same period in 2023.
Q4 2024 volumes were lower than those in the same period in 2023 primarily as a result of adverse weather conditions
which hampered operations to a greater degree than usual and unscheduled maintenance which prevented loading at
Berth 1 for seven days. Of the tonnes shipped in Q4 2024, 65% was thermal coal and 35% was metallurgical coal,
compared to 64% and 36% respectively for the same period in the prior year.
Coal loading revenue increased by 1.1% to $86.4 million for Q4 2024 compared to $85.5 million for the same
period in 2023. The average loading rate in Q4 2024 was $13.76 per tonne compared to $12.70 per tonne through the
same period in 2023. The increased average loading rate in Q4 2024 reflects escalation of loading rates as well as
foreign exchange effects as some customers pay in U.S. dollars.
Other revenue of $24.4 million for Q4 2024 increased from $3.2 million for the same period in 2023. The
significant increase in Q4 2024 is primarily because we recognized into income previous payments of $21.3 million
relating to reservation fees. This amount was previously recorded as deferred revenue.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
11
Operating and administrative expenses increased by 2.2% to $59.2 million for Q4 2024 compared to $57.9 million
for the same period in 2023. Due to the accounting for the Amended Lease, referred to under “Liquidity and Capital
Resources”, the Q4 2024 operating and administrative expenses include approximately $1.5 million less overall
expenses relating to the Amended Lease than was included in Q4 2023. The increase in Q4 2024 operating and
administrative expenses reflects increased expenses due to inflation and timing of maintenance activities.
Foreign exchange loss of $2.2 million in Q4 2024 decreased from a gain of $0.7 million in the same period of 2023.
Q4 2024 included a $2.5 million unrealized loss on the mark to market of foreign exchange hedging contracts. Q4
2023 included a $1.3 million unrealized gain on the mark to market of foreign exchange hedging contracts.
Net finance costs increased to $4.8 million in Q4 2024 from $0.9 million during the same period of 2023. Most of
the increase in net finance cost is a result of the revaluation of the lease obligation and right-of-use asset relating to
the amendment of Westshore’s lease with VFPA, referred to under “Liquidity and Capital Resources”.
Income tax expense increased to $11.6 million in Q4 2024 from $8.3 million in Q4 2023 due to higher profits
before taxes.
Profit in the quarter increased to $31.4 million in Q4 2024 from $22.3 million during the same period of 2023,
primarily as a result of higher revenues which include the reservation fee that was recognized in revenue, partially
offset by higher operating and administrative expenses, foreign exchange losses and net finance costs, as discussed
above.
Other comprehensive income or loss includes actuarial gains and losses on the defined benefit post-retirement
obligations which are primarily impacted by the discount rate used, membership assumptions and the plan asset
performance (relative to actuarial expectations).
After-tax other comprehensive income (loss) for the fourth quarter increased to an income of $10.9 million in
2024 from a loss of $10.9 million in 2023. The change in the fourth quarter of 2024 was primarily caused by a 0.25%
increase in the discount rate which decreased the post-retirement obligations, and plan assets performing better than
actuarial expectations. The change in the fourth quarter of 2023 was primarily caused by a 1.0% decrease in the
discount rate which increased the post-retirement obligations, which was partially offset by plan assets performing
better than actuarial expectations.
Full year analysis
Tonnage shipped in 2024 was 26.8 million tonnes compared to 27.7 million tonnes in 2023, down 3.5% year over
year. Of the tonnes shipped in 2024, 66% was thermal coal, 33% was metallurgical coal and 1% was petroleum coke,
compared to 64%, 36% and less than 1% respectively for 2023.
Coal loading revenue increased by 2.2% to $368.2 million in 2024 from $360.4 million in 2023. The average
loading rate for 2024 was $13.76 per tonne compared to $13.00 per tonne for 2023. The increased average loading
rate in 2024 reflects escalation of loading rates as well as foreign exchange effects as some customers pay in U.S.
dollars.
Other revenue of $36.5 million consisted primarily of $21.3 million of previously paid customer reservation fees
that were recognized in revenue, $7.9 million on account of train and vessel operations and $6.4 million for wharfage
fees. Other revenue for 2023 of $20.6 million consisted of $7.8 million on account of train and vessel operations, $6.4
million for wharfage fees and the remainder primarily being customer shortfall payments.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
12
Operating and administrative expenses increased by 2.8% to $224.9 million compared to $218.7 million for the
same period in 2023. Due to the accounting for the Amended Lease, referred to under “Liquidity and Capital
Resources”, the 2024 operating and administrative expenses include approximately $5.8 million less overall expenses
relating to the Amended Lease than was included in 2023, even though Westshore paid substantially similar rent in
each of these years. The increase in the 2024 operating and administrative expenses compared to 2023 is due to a non-
recurring labour adjustment associated with unionized labour costs, inflation, timing of maintenance activities, and
operational constraints caused by the significant amount of construction work pertaining to the potash project.
Foreign exchange loss of $2.9 million in 2024 increased from a gain of $1.7 million in the same period of 2023.
2024 included a $3.7 million unrealized loss on the mark to market of foreign exchange hedging contracts, compared
to a $1.8 million unrealized gain in 2023.
Net finance costs increased to $17.3 million in 2024 from $4.3 million in 2023. Substantially all of the increase in
net finance cost is a result of the revaluation of the lease obligation and right-of-use asset relating to the amendment
of Westshore’s lease with VFPA, referred to under “Liquidity and Capital Resources”.
Income tax expense decreased to $42.7 million in 2024 from $43.2 million in 2023 due to lower profits before
taxes.
Profit decreased to $115.3 million in 2024 from $116.6 million in 2023, primarily as a result of higher operating and
administrative expenses, foreign exchange losses and net finance costs, as discussed above.
Other comprehensive income or loss includes actuarial gains and losses on the defined benefit post-retirement
obligations which are primarily impacted by the discount rate used, membership assumptions and the plan asset
performance (relative to actuarial expectations).
After tax other comprehensive income increased to $13.6 million in 2024 from a loss of $4.6 million in 2023. The
change was primarily caused by changes in economic assumptions which decreased the post-retirement obligations,
and plan assets performing better than actuarial expectations. The change in the year ended December 31, 2023 was
primarily caused by a 0.5% decrease in the discount rate which increased the post-retirement obligations, which was
partially offset by plan assets performing better actuarial expectations.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
13
Cash Flows
Cash flows from operations are available to the Corporation to fund capital and other expenditures, establish
reserves and pay dividends to and repurchase shares from shareholders.
(In thousands of Canadian dollars)
Year Ended
December 31,
2024
December 31,
2023
$
$
Operating cash flows before the below noted items
198,446
198,798
Working capital changes
36,973
(31,051)
Long term receivable
(12,836)
(2,634)
Lease obligation interest paid
(20,077)
(8,911)
Long term deferred revenue
256,528
52,670
Income tax paid
(62,960)
(19,281)
Cash flow provided by operations
396,074
189,591
Cash flows used in financing activities
(126,222)
(88,272)
Cash flows used in investing activities
(298,006)
(91,640)
Increase (decrease) in cash and cash equivalents
(28,154)
9,679
Operating cash flows before changes in working capital, long term receivable, lease obligation interest payments,
long term deferred revenue and income tax payments of $198.4 million in 2024 is comparable to $198.8 million in
2023. Working capital changes resulted in a $37.0 million inflow in 2024 compared to a $31.1 million outflow in 2023,
primarily due to changes in accounts receivables and deferred revenue which fluctuate depending on the timing of
receipts. $243.7 million was received in the year from BHP for the potash project (2023 - $50.0 million). Income tax
payments increased to $63.0 million in 2024 from $19.3 million in 2023 due to the timing of tax payments. As a result
of these changes, cash flow from operations increased to $396.1 million in 2024 from $189.6 million in 2023.
Long term deferred revenue of $235.2 million in 2024 increased from $52.7 million in 2023, primarily as a result of
the increased amounts invoiced to BHP in connection with the potash project and partially off set by the $21.3 million
reservation fee that was brought into income. All amounts invoiced to BHP for the construction of the potash project
are recorded as deferred revenue and will be recognized when the corresponding future services are provided over the
term of the BHP Agreement. Westshore’s total long term deferred revenue as at December 31, 2024 was $363.3 million
compared to $128.1 million as at December 31, 2023.
Cash flows used in financing activities increased to $126.2 million in 2024 from $88.3 million in 2023, primarily
due to the $21.9 million special dividend paid in 2024. Regular dividends paid to shareholders also increased year over
year. During 2024, the Corporation purchased under its NCIB 744,909 shares for approximately $17.7 million. For
the year ended December 31, 2023, 314,784 shares were purchased for approximately $7.6 million.
Cash flows used in investing activities increased to $298.0 million in 2024 from $91.6 million in 2023, primarily
driven from an increase in capital expenditures. Of that $298.0 million, $294.8 million was related to the potash
project. At the end of the year, $98.0 million had been incurred in capital expenditures but was not yet paid for.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
14
Liquidity and Capital Resources
Meeting annual operating and capital requirements and payment of the dividend, along with managing variations in
working capital, are well within Westshore’s financial capacity based solely on revenues less expenses, without any
need for financing except for material capital improvements. As a result, the Corporation does not anticipate any
liquidity concerns with the ongoing operations of Westshore.
Pursuant to the BHP Agreement, BHP is required to reimburse Westshore for construction costs relating to the
potash infrastructure additions up to the agreed budget of approximately $1 billion and subject to a 5% holdback on
each periodic payment, which is reflected in the balance sheet as a “long term receivable” ($18.2 million as at
December 31, 2024), after which costs incurred by Westshore to complete the project will not be reimbursed. Based
on the information currently available, Westshore expects to contribute approximately $225 million for such expenditures,
and that they will be incurred starting in the second quarter of 2026 and continuing until final payments to suppliers
expected in mid 2027. Significant factors in the increase in project costs over the budget include inflation having been
higher than anticipated when the budget was established in 2021, and delays in completion of outsourced design
engineering which will result in increased labour and other costs to maintain the tight project schedule. The Corporation
does not anticipate any liquidity concerns resulting from Westshore’s obligation to fund the potash project cost
overruns and expects to fund much of this amount through its cash reserve, cash flows from operations and funds
released under the 5% holdback, with any further requirements being funded by borrowing. As at December 31, 2024,
Westshore has commitments related to the potash project of $349.2 million that have not yet been accrued for.
Westshore has a $40 million operating facility that is used for a letter of credit related to pension funding and day
to day operational liquidity. The facility matures on August 31, 2025 and is secured by a pledge of all the assets of
Westshore. Westshore does not anticipate any issues with extending this credit facility when it matures. The operating
facility bears interest at a variable rate plus a margin and no repayments will be required until maturity. During the
year, Westshore decreased its outstanding letter of credit from $11.4 million to $1.3 million under this facility. This is
the only amount drawn on the facility at year end.
Westshore has post-retirement benefit obligations under its defined benefit pension plan and other post-retirement
benefits plans which it is required to fund each year. Westshore’s cash funding requirements were $2.4 million in 2024
(2023 - $2.4 million), which is for payments for other post-retirement benefits. No contributions were required for the
defined benefit pension plan as this plan is currently in a surplus position.
The statement of financial position as of December 31, 2024 reflects a net defined benefits pension asset of
$34.2 million (December 31, 2023 - $28.3 million) and $64.6 million (December 31, 2023 - $69.7 million) of other
post-retirement benefit obligations. The change in 2024 was primarily caused by changes in economic assumptions
since December 31, 2023 and stronger plan asset performance. This net obligation amount will decline in the future if
long term interest rates increase and will increase if such rates fall.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
15
Future undiscounted minimum payments under Westshore’s material lease obligations are as follows:
(In thousands of Canadian dollars)
December 31,
2024
Less than 1 year
$
20,711
Between 1 and 5 years
90,356
More than 5 years
946,807
$
1,057,874
In the first quarter of 2024, our lease with VFPA was amended, with retroactive effect as of January 1, 2023 (the
“Amended Lease”). The Corporation’s audited consolidated financial statements for the years ended December 31,
2024 and 2023 reflect the financial terms of the now prior lease for year ending December 31, 2023 and the financial
terms of the Amended Lease for the year ending December 31, 2024.
Under the Amended Lease, annual rent is comprised of two fixed amounts, basic rent and ancillary rent. The basic
rent is fixed until December 31, 2026, and may be revised by VFPA at that time and every three years thereafter. If
VFPA increases the basic rent at any such time, Westshore has the right to seek a review of the revised amount. The
ancillary rent will escalate annually. Unlike the prior lease, the Amended Lease does not provide for an annual
participation rental fee based on the volume of product shipped. As a result of the rent under the Amended Lease
being entirely fixed, the revaluation of each of the right-of-use asset and the lease obligation increased by $163.7
million. The total amount paid in 2024 under the Amended Lease was $20.3 million.
Westshore does not have any material other long-term obligations.
Distributions
Distributions by the Corporation over the last two years were as follows:
(In thousands of Canadian dollars except per share amounts)
2024
2023
$
Per share
$
Per share
Quarter 1
23,443
0.375
21,880
0.35
Special Dividend declared in Q1
21,880
0.350
-
-
Quarter 2
23,188
0.375
21,880
0.35
Quarter 3
23,164
0.375
21,880
0.35
Quarter 4
23,164
0.375
21,880
0.35
Total Dividends on Common Shares
114,839
1.85
87,520
1.40
The dividend is subject to periodic review based on factors including operating performance, current and anticipated
market conditions, funds applied to repurchase shares, other opportunities that may come before Westshore, and
funding of capital upgrade projects. In circumstances where the price of the Corporation’s shares makes share
repurchases advantageous to the Corporation, a portion of excess cash from operations may be used to repurchase
common shares.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
16
Outlook
The operating cash inflows of the Corporation are entirely dependent on Westshore’s operating results. They are
affected by the volume and mix of coal shipped through the Terminal, the rates charged to customers for the handling
of that coal, and Westshore’s operating and administrative costs.
The variance in revenues from 2024 will ultimately be impacted by numerous factors, including total volumes
shipped through the Terminal, the distribution of throughput by customer and the US/CDN dollar exchange rate.
Based on the most recent information provided by Westshore’s customers, performance year to date, anticipated
rail performance, and construction activity on site, 2025 throughput volumes are anticipated to be approximately
26.5 million tonnes at an average loading charge of approximately $13.55 per tonne, for the full year. The average
loading rate for a period reflects the customer mix and US/CDN exchange rate.
Westshore’s potash project is on schedule to complete in 2026 and we anticipate meaningful revenue for potash
handling to commence in 2027. Due to the higher than budgeted inflation rate and delays in completion of
outsourced design engineering which will result in increased labour and other costs to maintain the tight project
schedule, we expect the total cost of the project to be approximately $225 million above the original budget, which
Westshore will be responsible for funding.
Related Party Transactions
The Manager provides management services to Westshore pursuant to a management agreement between Westshore
and the Manager (the “Management Agreement”). Westshore pays an annual management fee to the Manager and an
incentive fee based on a percentage of annual profit above $42 million, subject to a cap of $7.5 million per annum. The
annual base management fee for 2024 was $1,900,000 (2023 - $1,845,000) which will escalate at 3% annually. The
incentive fee for the year ended December 31, 2024 was $5,235,000 and was paid subsequent to December 31, 2024
(2023 - $4,743,000 paid in 2024).
The Manager also provides administration services to the Corporation pursuant to an administration agreement and
appoints three of the eight directors of the General Partner pursuant to a governance agreement. The Corporation pays
an annual administration fee in monthly installments. The fee paid to the Manager for 2024 was $633,000 (2023 -
$615,000), which will increase by 3% per annum.
Affiliates of the Manager also provides insurance and vehicle related services to Westshore.
Additional details on related party transactions are contained in note 21 to the Corporation’s financial statements.
Changes in Accounting Policies
The Corporation’s accounting policies are found in note 3 of the Corporation’s financial statements. There were no
significant changes in accounting policies in 2024.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
17
Critical Accounting Estimates
The preparation of financial statements and related disclosures in accordance with IFRS Accounting Standards
requires the Corporation to make estimates and assumptions that affect the reported amounts of assets, liabilities,
revenues, expenses and contingencies. These estimates are based on historical experience and on assumptions that are
considered at the time to be reasonable under the circumstances. Under different assumptions or conditions, the
actual results may differ, potentially materially, from those previously estimated.
The following is a discussion of the accounting estimates that are significant in determining the Corporation’s
financial results.
Property, plant and equipment: Depreciation
Property, plant and equipment are stated at cost less accumulated depreciation. The right-of-use asset is initially
measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or
before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and
remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease
incentives received. Depreciation is calculated using the straight line method over the estimated useful production life
of the assets. The estimated useful lives of property, plant and equipment range from 3 to 35 years and are reviewed
annually. A change in the estimated useful lives of property, plant and equipment could result in either a higher or
lower depreciation charge to profit for the period.
Asset Retirement Obligations
Westshore is required to recognize the fair value of an estimated asset retirement obligation when a legal or
constructive obligation is present, a reliable estimate of the obligation can be made, and it is probable that Westshore
will be required to settle the obligation. At the expiry of the Terminal’s lease, the VFPA has the option to acquire the
assets of the Terminal at fair value or require Westshore to return the site to its original condition. Westshore believes
that the probability that the VFPA will elect to enforce site restoration is remote. Any change in the estimate of the
probability of incurring such costs could have a material impact on the asset retirement obligation.
Lease Obligation
The lease obligation is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using Westshore’s incremental borrowing rate. The lease liability is measured at
amortized cost using the effective interest rate method. It is remeasured when there is a change in future lease
payments arising from a change in an index or rate, if there is a change in Westshore’s estimate of the amount
expected to be payable under a residual value guarantee or if Westshore changes its assessment of whether it will
exercise a purchase, extension or termination option. Any change in the incremental borrowing rate of Westshore
could have a material impact on future lease obligations.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
18
Goodwill
Goodwill is tested for impairment on an annual basis, or more frequently if events or changes in circumstances
indicate that the asset might be impaired, by comparing the fair value of Westshore to its carrying value, including
goodwill. If the fair value of Westshore is less than its carrying value, a goodwill impairment loss is recognized as the
excess of the carrying value of the goodwill over the fair value of the goodwill. The determination of fair value
requires management to make assumptions and estimates about future coal loading rates, customer shipments,
operating costs, foreign exchange rates and discount rates. Changes in any of these assumptions, such as lower coal
loading rates, a decline in customer shipments, an increase in operating costs or an increase in discount rates could
result in an impairment of all or a portion of the goodwill carrying value in future periods.
Employee Future Benefits
Westshore has post-retirement benefit obligations under its defined benefit pension plan and other post-retirement
benefit plans, the costs of which are based on estimates. Actuarial calculations of benefit costs and obligations depend
on Westshore’s assumptions about future events. Major estimates and assumptions relate to expected plan investment
performance, salary escalation, retirement ages of employees and expected health care costs, as well as discount rates,
withdrawal rates and mortality rates.
Internal Controls Over Financial Reporting
The Corporation maintains a system of internal controls over financial reporting, as defined by National Instrument
52-109 – Certification of Disclosure in Issuers’ Annual and Interim Filings (“National Instrument 52-109”), in order to provide
reasonable assurance regarding the reliability of financial reporting and the preparation of financial information for
external purposes in accordance with IFRS Accounting Standards.
The Chief Executive Officer and Chief Financial Officer of the Corporation have caused to be evaluated under their
supervision, the effectiveness of the Corporation’s internal controls over financial reporting as of December 31, 2024.
Based on that assessment, it was determined that the internal controls over financial reporting were appropriately
designed and were operating effectively. No material changes were identified in the Corporation’s internal controls over
financial reporting during the year ended December 31, 2024 that have materially affected the Corporation’s internal
controls over financial reporting or are reasonably likely to materially affect the Corporation’s internal controls over
financial reporting.
It should be noted that a control system, including the Corporation’s internal controls and procedures, no matter
how well conceived, can provide only reasonable, but not absolute, assurance that the objectives of the control system
will be met, and it should not be expected that the disclosure and internal controls and procedures will prevent all errors
or fraud.
The design of any system of controls is also based in part upon certain assumptions about the likelihood of future
events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future
conditions.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
19
Disclosure Controls and Procedures
“Disclosure controls and procedures” are defined as follows in National Instrument 52-109: “Disclosure controls
and procedures” means controls and other procedures of an issuer that are designed to provide reasonable assurance
that information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or
submitted by it under provincial and territorial securities legislation is recorded, processed, summarized and reported
within the time periods specified in the provincial and territorial securities legislation and include, without limitation,
controls and procedures designed to ensure that information required to be disclosed by an issuer in its annual filings,
interim filings or other reports filed or submitted under provincial and territorial securities legislation is accumulated
and communicated to the issuer’s management, including its chief executive officer and chief financial officer (or
persons who perform similar functions to a chief executive officer or a chief financial officer), as appropriate to allow
timely decisions regarding required disclosure.”
As required by National Instrument 52-109, the Chief Executive Officer and the Chief Financial Officer of the
Corporation, in conjunction with management of the General Partner, have evaluated the effectiveness of the design
and tested the operation of the disclosure controls and procedures of Westshore, the General Partner and the
Corporation as of December 31, 2024 and have concluded that such disclosure controls and procedures provide
reasonable assurance that information required to be disclosed in the annual filings, interim filings or other reports filed
or submitted under provincial and territorial securities legislation is recorded, processed, summarized and reported
within the time periods specified in such legislation.
Additional information relating to the Corporation and Westshore, including the Corporation’s annual information
form, is available at https://www.sedarplus.ca.
Management’s Report
The consolidated financial statements and other information in this annual report have been prepared by and are
the responsibility of the management of the Corporation. The consolidated financial statements have been prepared in
accordance with IFRS Accounting Standards and reflect where necessary management’s best estimates and judgments.
Management is also responsible for maintaining systems of internal and administrative controls to provide reasonable
assurance that the Corporation’s assets are safeguarded, that transactions are properly executed in accordance with
appropriate authorization and that the accounting systems provide timely, accurate and reliable financial information.
The Directors are responsible for assuring that management fulfills its responsibility for financial reporting and
internal control. The Directors perform this responsibility at meetings where significant accounting, reporting and
internal control matters are discussed and the consolidated financial statements and annual report are reviewed and
approved.
The consolidated financial statements have been audited on behalf of the shareholders by KPMG LLP, Chartered
Professional Accountants, in accordance with International Financial Reporting Standards. The Auditor’s Report
outlines the scope of their examination and their independent professional opinion on the fairness of these financial
statements.
Westshore Terminals Investment Corporation
Management’s Discussion & Analysis of
Financial Condition and Results of Operations
20
(Signed) “William W. Stinson”
(Signed) “M. Dallas H. Ross”
William W. Stinson
M. Dallas H. Ross
Director
Director
21
WESTSHORE TERMINALS INVESTMENT CORPORATION
Consolidated Statements of Financial Position
(Expressed in thousands of Canadian dollars)
December 31,
December 31,
Note
2024
2023
Assets
Current assets:
Cash and cash equivalents
$
136,593
$
164,747
Accounts receivable
33,143
41,821
Inventories
18,688
18,523
Prepaid expenses
3,301
2,632
Other assets
14
-
1,083
191,725
228,806
Property, plant and equipment:
5
At cost
1,187,105
845,096
Accumulated depreciation
(366,552)
(343,229)
820,553
501,867
Long term receivable
15
18,165
5,329
Right-of-use assets
16
411,115
256,337
Goodwill
365,541
365,541
Other intangible assets
6
9,210
8,473
Employee future benefits
12
34,222
28,286
$
1,850,531
$
1,394,639
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accrued liabilities
$
164,946
$
103,079
Income tax payable
2,556
16,033
Deferred revenue
16,885
1,511
Other liabilities
14
2,611
-
Lease obligation current portion
16
550
3,024
Dividends payable to shareholders
10
23,164
21,880
210,712
145,527
Long term deferred revenue
15
363,303
128,075
Deferred income taxes
9
45,174
46,916
Employee future benefits
12
64,579
69,701
Lease obligation
16
440,864
274,866
1,124,632
665,085
Shareholders' equity:
Share capital
10
1,419,472
1,436,587
Deficit
(693,573)
(707,033)
725,899
729,554
$
1,850,531
$
1,394,639
Commitments and contingencies (note 17)
See accompanying notes to consolidated financial statements.
Approved on behalf of the Board:
(Signed) "William W. Stinson"
(Signed) "M. Dallas H. Ross"
William W. Stinson
M. Dallas H. Ross
Director
Director
22
WESTSHORE TERMINALS INVESTMENT CORPORATION
Consolidated Statements of Comprehensive Income
(Expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
Note
2024
2023
Revenue:
Coal loading
$
368,212
$
360,392
Other
15
36,517
20,603
404,729
380,995
Expenses:
4
Operating
206,449
201,368
Administrative
18,456
17,283
224,905
218,651
Other:
Foreign exchange gain (loss)
(2,860)
1,697
Loss on disposal of property, plant and equipment
equipment
(1,664)
(9)
Net finance costs
7
(17,333)
(4,302)
Profit before income tax
157,967
159,730
Income tax expense
8
42,715
43,175
Profit for the year
115,252
116,555
Other comprehensive income (loss):
Items that will not be recycled to net income:
Defined benefit plan actuarial gains (losses)
12
18,614
(6,308)
Income tax recovery (expense) on other
comprehensive income (loss)
8
(5,026)
1,703
Other comprehensive income (loss) for the
year, net of income tax
13,588
(4,605)
Total comprehensive income for the year
$
128,840
$
111,950
Profit per share:
Basic and diluted earnings per share
11
$
1.86
$
1.86
Weighted average number of shares outstanding
62,082,433
62,536,268
See accompanying notes to the consolidated financial statements.
23
WESTSHORE TERMINALS INVESTMENT CORPORATION
Consolidated Statements of Changes in Equity
(Expressed in thousands of Canadian dollars)
Years ended December 31, 2024 and 2023
Share capital
Deficit
Total
Balance at January 1, 2023
$
1,443,821
$
(731,115)
$
712,706
Profit for the year
-
116,555
116,555
Other comprehensive loss:
Defined benefit plan actuarial losses, net of tax
-
(4,605)
(4,605)
Total comprehensive income for the year
-
111,950
111,950
Distributions to shareholders of the Corporation:
Dividends declared to shareholders
-
(87,520)
(87,520)
Adjustments due to share repurchases
(7,234)
(348)
(7,582)
Balance at December 31, 2023
$
1,436,587
$
(707,033)
$
729,554
Share capital
Deficit
Total
Balance as at January 1, 2024
$
1,436,587
$
(707,033)
$
729,554
Profit for the year
-
115,252
115,252
Other comprehensive income:
Defined benefit plan actuarial gains, net of tax
-
13,588
13,588
Total comprehensive income for the year
-
128,840
128,840
Distributions to shareholders of the Corporation:
Dividends declared to shareholders
-
(114,839)
(114,839)
Adjustments due to share repurchases
(17,115)
(541)
(17,656)
Balance at December 31, 2024
$
1,419,472
$
(693,573)
$
725,899
See accompanying notes to the consolidated financial statements.
24
WESTSHORE TERMINALS INVESTMENT CORPORATION
Consolidated Statements of Cash Flows
(Expressed in thousands of Canadian dollars)
Years ended December 31, 2024 and 2023
2024
2023
Cash provided by (used in):
Operations:
Profit for the year
$
115,252
$
116,555
Adjustments for:
Foreign exchange contracts
3,694
(1,756)
Depreciation and amortization
33,968
30,529
Employee future benefits
5,120
5,984
Net finance costs
17,333
4,302
Income tax expense
42,715
43,175
Loss on disposal of property, plant and equipment
1,664
9
Long term deferred revenue
(21,300)
-
198,446
198,798
Changes in non-cash operating working capital and other:
Accounts receivable
8,678
(33,035)
Inventories
(165)
(898)
Prepaid expenses
(669)
(129)
Accounts payable and accrued liabilities
13,755
12,867
Deferred revenue
15,374
(9,856)
36,973
(31,051)
Long term receivable
(12,836)
(2,634)
Lease obligation interest paid
(20,077)
(8,911)
Long term deferred revenue
256,528
52,670
Income taxes paid
(62,960)
(19,281)
396,074
189,591
Financing:
Interest received
5,180
6,484
Dividends paid to shareholders
(113,555)
(84,489)
Share purchases
(17,656)
(7,582)
Lease obligation
(191)
(2,685)
(126,222)
(88,272)
Investments:
Property, plant and equipment, net
(296,383)
(91,056)
Other intangible assets
(1,623)
(584)
(298,006)
(91,640)
Increase (decrease) in cash and cash equivalents
(28,154)
9,679
Cash and cash equivalents, beginning of the year
164,747
155,068
Cash and cash equivalents, end of the year
$
136,593
$
164,747
Supplemental information:
Non-cash transactions:
Capital expenditures unpaid at year end
$
98,005
$
49,893
Lease modification
163,715
-
Long term deferred revenue recognized into income
21,300
-
See accompanying notes to the consolidated financial statements.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
25
1. Reporting entity:
Westshore Terminals Investment Corporation was incorporated under the Business Corporation Act (British
Columbia) on September 28, 2010 and is domiciled in Canada. The registered and head office is located at Suite
1800, 1067 West Cordova Street, Vancouver, British Columbia, V6C 1C7. These consolidated financial statements
as at and for the year ended December 31, 2024 comprises Westshore Terminals Investment Corporation and its
subsidiaries (together referred to as the “Corporation”). The Corporation owns all of the limited partnership units
of Westshore Terminals Limited Partnership (“Westshore”), a partnership established under the laws of British
Columbia.
The Corporation derives its cash inflows from its investment in Westshore by way of distributions on Westshore’s
limited partnership units. Westshore operates a coal storage and loading terminal at Roberts Bank, British Columbia
(the “Terminal”). Substantially all of Westshore’s operating revenues are derived from rates charged for loading
coal onto seagoing vessels.
2. Basis of preparation:
(a) Statement of compliance:
The consolidated financial statements have been prepared in accordance with IFRS Accounting Standards.
The consolidated financial statements were authorized for issue by the Board of Directors on March 14, 2025.
(b) Basis of measurement:
These consolidated financial statements have been prepared on the historical cost basis except for the following
material items in the statement of financial position:
• derivative financial instruments are measured at fair value;
• the defined benefit obligation is recognized as the present value of the defined benefit obligation, less plan
assets at fair value; and
• lease obligations are measured at amortized cost using the effective interest rate method.
(c) Functional and presentation currency:
These consolidated financial statements are presented in Canadian dollars, which is the Corporation and its
subsidiaries’ functional currency. All financial information presented in Canadian dollars have been rounded to
the nearest thousand.
(d) Use of estimates and judgments:
The preparation of the consolidated financial statements in conformity with IFRS Accounting Standards
requires management to make judgments, estimates, and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income, and expenses. Actual results may differ from
these estimates.
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.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
26
Assumptions, judgments, and estimation uncertainties that have a risk of resulting in a material adjustment
relate to the determination of the useful lives of plant and equipment, decommissioning liabilities, measurement
of lease obligations, valuation of goodwill and the measurement of defined benefit obligations.
3. Material accounting policies:
The accounting policies set out below have been applied consistently to all periods presented in these consolidated
financial statements.
(a) Basis of consolidation:
(i) Subsidiaries:
Subsidiaries are entities controlled by the Corporation. The financial statements of subsidiaries are included
in the consolidated financial statements from the date that control commences until the date the control
ceases.
(ii) Transactions eliminated on consolidation:
Intra-corporation balances and transactions, and any unrealized income and expenses arising from intra-
corporation transactions, are eliminated in preparing the consolidated financial statements.
(b) Foreign currency:
The functional and reporting currency of the Corporation and its subsidiaries is the Canadian dollar.
Transactions which are denominated in other currencies are translated into their Canadian dollar equivalents at
exchange rates prevailing at the transaction date. The carrying values of monetary assets and liabilities
denominated in foreign currencies are adjusted at each reporting date to reflect exchange rates prevailing at that
date. The foreign currency gain or loss on monetary items is the difference between amortized cost in the
functional currency at the beginning of the period, adjusted for effective interest and payments during the
period, and the amortized cost in the foreign currency translated at the exchange rate at the end of the period.
Foreign exchange gains and losses are recognized under ‘Foreign exchange gain (loss)’ in profit or loss.
(c) Financial instruments:
Financial instruments comprise cash and cash equivalents, accounts receivable, including long term receivable,
derivative instruments and accounts payable and accrued liabilities. The Corporation uses derivative financial
instruments in the normal course of its operations as a means to manage its foreign exchange risk. The
Corporation’s policy is not to utilize derivative financial instruments for trading or speculative purposes. The
Corporation’s derivative financial instruments are not designated as hedges for accounting purposes.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
27
The Corporation’s financial instruments are classified and measured as follows:
Classification and measurement of financial assets
Financial assets are classified as: measured at amortized cost; fair value through other comprehensive income
(“FVOCI”); or fair value through profit and loss (“FVTPL”) based on the business model in which a financial
asset is managed and its contractual cash flow characteristics and when certain conditions are met:
•
Amortized cost – measured at amortized cost using the effective interest rate method. Where applicable,
amortized cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and
impairment are recognized in net income.
•
FVOCI – measured at FVOCI if not designated as FVTPL. Interest income, foreign exchange gains and
losses and impairment are recognized in net income. Other net gains and losses are recognized in other
comprehensive income (“OCI”). On derecognition, gains and losses accumulated in OCI are reclassified
to net income.
•
FVTPL – measured at FVTPL if not classified as amortized cost or FVOCI with net gains and losses,
including any interest or dividend income, recognized in net income.
Equity investments are required to be classified as measured at fair value. However, on initial recognition of an
equity investment that is not held-for-trading, the Corporation may irrevocably elect to present subsequent
changes in the investments fair value in OCI. This election is made on an investment by investment basis. The
Corporation does not have any equity investments.
Classification and measurement of financial liabilities
Financial liabilities are classified as either measured at amortized cost or FVTPL. A financial liability is classified
as FVTPL if it is held-for-trading, a derivative or it is designated as such on initial recognition. Financial
liabilities at FVTPL are measured at fair value with net gains and losses, including interest expense, recognized
in net income. Other financial liabilities are subsequently measured at amortized cost using the effective interest
rate method. Interest expense and foreign exchange gains and losses are recognized in net income. Any gains
or losses on derecognition are also recognized in net income.
(d) Property, plant and equipment:
(i) Recognition and measurement:
Items of property, plant, and equipment are measured at historical cost less accumulated depreciation and
accumulated impairment losses.
Financial Assets
Cash and cash equivalents
Amortized cost
Accounts receivable, including long term receivable
Amortized cost
Derivative instruments
FVTPL
Financial Liabilities
Accounts payable and accrued liabilities
Amortized cost
Dividends payable
Amortized cost
Derivative instruments
FVTPL
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
28
Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-
constructed assets includes the cost of materials and direct labour, any other costs directly attributable to
bringing the assets to a working condition for their intended use, the costs of dismantling and removing
the items and restoring the site on which they are located, and borrowing costs on qualifying assets.
Borrowing costs attributable to the construction of a qualifying asset are included in the cost of the asset.
Other borrowing costs are recognized as an expense.
When parts of an item of property, plant, and equipment have different useful lives, they are accounted for
as separate items of property, plant, and equipment.
The gain or loss on disposal of an item of property, plant, and equipment is determined by comparing the
proceeds from disposal with the carrying amount of the property, plant, and equipment, and is recognized
net within other income/expenses in profit or loss.
(ii) Depreciation:
Depreciation is based on the cost of an asset less its residual value. Significant components of individual
assets are assessed, and if a component has a useful life that is different from the remainder of the asset,
then that component is depreciated separately.
Depreciation is recognized in profit or loss on a straight-line basis over the estimated useful lives of each
component of an item of property, plant, and equipment. The estimated useful lives for the current and
comparative periods are as follows:
Asset
Term
Automobiles
3 years
Conveyor belts
5 years
Mobile equipment
5 years to 25 years
Land improvements
15 years to 30 years
Buildings
8 years to 35 years
Fixed machinery
8 years to 35 years
Depreciation methods, useful lives, and residual values are reviewed at each financial year end and adjusted
if appropriate.
(e) Impairment:
Non-Financial assets
The carrying values of the Corporation’s non-financial assets are reviewed at each reporting date to assess
whether there is any indication of impairment. If any such indication is present, then the recoverable amount
of the assets is estimated.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
29
The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value
less costs to sell. 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 purposes of impairment testing, assets are grouped at the lowest levels that generate
cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of
assets (the “cash-generating unit”).
An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its
estimated recoverable amount. Impairment losses are recognized in profit and loss. 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 charge 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.
Financial assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it
is impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events
have had a negative effect on the estimated future cash flows of that asset.
The Corporation applies the simplified approach in determining expected credit losses (“ECLs”), which
requires a probability-weighted estimate of expected lifetime credit losses to be recognized upon initial
recognition of financial assets measured at amortized cost, contract assets and debt investments at FVOCI.
Credit losses are measured as the present value of cash shortfalls from all possible default events, discounted
at the effective interest rate of the financial asset. Loss allowances for financial assets at amortized cost are
deducted from the gross carrying amount of the assets.
(f) Goodwill and other intangible assets:
Goodwill is recognized on a business combination at the acquisition date and is initially measured at the fair
value of the consideration transferred less the net recognized amount (generally fair value) of the identifiable
assets acquired and liabilities assumed.
Goodwill is subsequently measured at cost less accumulated impairment losses. Goodwill is tested for
impairment on an annual basis, or more frequently if events or changes in circumstances indicate that the asset
might be impaired. Any excess of the carrying value over fair value is charged to profit or loss in the period in
which the impairment is determined.
Computer software is carried at cost less accumulated amortization. Amortization is calculated to write off the
cost of computer software less their estimated residual values using straight-line method over their estimated
useful lives, and is recognized in profit and loss. The estimated useful lives of computer software range from 3
to 5 years. Amortization methods, useful lives, and residual values are reviewed at each financial year end and
adjusted if appropriate.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
30
(g) Leases
At inception of a contract, the Corporation assesses whether a contract is, or contains, a lease. 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. To assess whether a contract conveys the right to control the use of an identified
asset, the Corporation uses the definition of a lease in IFRS 16.
As a lessee:
At commencement or on modification of a contract that contains a lease component, the Corporation allocates
the consideration in the contract to each lease component on the basis of its relative stand-alone prices.
However, for the leases of property the Corporation has elected not to separate non-lease components and
account for the lease and non-lease components as a single lease component.
The Corporation recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-
of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for
any lease payments made at or before the commencement date, plus any initial direct costs incurred and an
estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on
which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the commencement date
to the end of the lease term, unless the lease transfers ownership of the underlying asset to the Corporation by
the end of the lease term or the cost of the right-of-use asset reflects that the Corporation will exercise a
purchase option. In that case the right-of-use asset will be depreciated over the useful life of the underlying
asset, which is determined on the same basis as those of property and equipment. In addition, the right-of-use
asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease
liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, the Corporation’s incremental borrowing rate. Generally, the Corporation uses its incremental
borrowing rate as the discount rate.
The Corporation determines its incremental borrowing rate by obtaining interest rates from various external
financing sources and makes certain adjustments to reflect the terms of the lease and type of the asset leased.
Lease payments included in the measurement of the lease liability comprise the following:
-
fixed payments, including in-substance fixed payments;
-
variable lease payments that depend on an index or a rate, initially measured using the index or rate as at
the commencement date;
-
amounts expected to be payable under a residual value guarantee; and
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
31
-
the exercise price under a purchase option that the Corporation is reasonably certain to exercise, lease
payments in an optional renewal period if the Corporation is reasonably certain to exercise an extension
option, and penalties for early termination of a lease unless the Corporation is reasonably certain not to
terminate early.
The lease liability is measured at amortised cost using the effective interest method. It is remeasured when there
is a change in future lease payments arising from a change in an index or rate, if there is a change in the
Corporation’s estimate of the amount expected to be payable under a residual value guarantee, if the
Corporation changes its assessment of whether it will exercise a purchase, extension or termination option or
if there is a revised in-substance fixed lease payment.
When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount
of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset has been
reduced to zero.
The Corporation presents right-of-use assets that do not meet the definition of investment property in ‘right-
of-use asset’ and lease liabilities in ‘lease obligation’ in the statement of financial position.
Short-term leases and leases of low-value assets
The Corporation has elected not to recognize right-of-use assets and lease liabilities for leases of low-value
assets and short-term leases, including IT equipment and vehicles. The Corporation recognizes the lease
payments associated with these leases as an expense on a straight-line basis over the lease term.
(h) Inventories:
Inventories of spare parts and supplies are measured at the lower of cost and net realizable value. Cost is
determined using the weighted average cost method and includes the invoiced cost and other directly
attributable costs of acquiring the inventory.
(i) Employee benefits:
Defined benefit plan
A defined benefit plan is a post-retirement benefit plan other than a defined contribution plan. The
Corporation’s net obligation in respect of its continuing defined benefit pension plan is calculated by estimating
the amount of future benefit that employees have earned in return for their service in the current and prior
periods; that benefit is discounted to determine its present value and the fair value of plan assets is deducted.
The discount rate used to determine the present value of the obligation is the yield at the reporting date on high
quality corporate bonds that have maturity dates approximating the term of the Corporation’s obligations and
that are denominated in the same currency in which the benefits are expected to be paid.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
32
The calculation is performed annually by a qualified actuary using the projected unit credit method. When the
calculation results in a benefit to the Corporation, the recognized asset is limited to the present value of
economic benefits available in the form of any future refunds from the plan or reductions in the future
contributions to the plan. In order to calculate the present value of economic benefits, consideration is given
to any minimum funding requirements. An economic benefit is available to the Corporation if it is realizable
during the life of the plan, or on settlement of the plan liabilities. When the benefits of a plan are improved,
the portion of the increased benefit relating to past service by employees is recognized in profit or loss on the
date of improvement.
The Corporation recognizes all actuarial gains and losses arising from its defined benefit plan immediately in
other comprehensive income and expenses related to its defined benefit plan in profit or loss.
Other long-term employee benefits
The Corporation’s net obligation in respect of long-term employee benefits other than pension plans is the
amount of future benefit that employees have earned in return for their service in the current and prior periods;
that benefit is discounted to determine its present value, and the fair value of any related assets is deducted.
The discount rate is the yield at the reporting date on high quality corporate bonds that have maturity dates
approximating the terms of the Corporation’s obligations. The calculation is performed using the projected
unit credit method. Any actuarial gains and losses are recognized immediately in other comprehensive income
in the period in which they arise.
(j) Revenue:
Coal loading revenue is recognized when a customer’s coal is loaded onto a ship. Coal loading revenue is
recorded based on contract specific loading rates. Other revenue includes all revenue other than coal loading
revenue and principally relates to costs on train, vessel and wharfage fees which are recovered from customers.
Other revenue also includes fees earned under take or pay contracts where the coal has not been delivered.
(k) Provisions:
Decommissioning liabilities
The Corporation’s terminal site is leased from the Vancouver Fraser Port Authority (the “VFPA”). The term
of the Amended Lease is January 1, 2023 to December 31, 2051, with Westshore having further options to
extend the term to December 31, 2070. At the expiry of the lease term, assuming the Corporation has not been
successful in further extending the lease, the VFPA has the option to acquire the assets of the terminal at fair
value or require the Corporation to return the site to its original condition. The Corporation believes that the
probability that the VFPA will elect to enforce site restoration is remote.
(l) Income tax:
Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognized in profit
or loss except to the extent they relate to items recognized directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the period, using tax
rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of
previous years.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
33
Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they
reverse, based on the laws that have been enacted or substantively enacted by the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities
and assets, and they relate to income taxes levied by the same authority on the same taxable entity, or on
different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets
and liabilities will be realized simultaneously.
A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary difference, to the
extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred
tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realized.
(m) New standards and interpretations not yet adopted:
Certain new accounting standards and interpretations are not yet effective and have not been early adopted for
the year ended December 31, 2024 in preparing these consolidated financial statements. The Corporation is
still assessing the effect of these new standards and interpretations on the Corporation’s financial statements.
IFRS 18 – Presentation and disclosure in the financial statements
IFRS 18 sets out general and specific requirements for the presentation of information in the statements of
comprehensive income, the statements of financial position and the statements of changes in equity, and also
for the disclosure of information in the notes to the financial statements. This standard introduces different
categories for classifying income and expenses as well as management-defined performance measures to the
financial statements and accompanying note disclosures. IFRS 18 is effective for annual reporting periods
beginning on or after January 1, 2027, with early application permitted.
Amendments to IAS 21– The effects of changes in foreign exchange rates
The amendment clarifies when a currency is not exchangeable into another currency and how to determine the
spot rate when a currency lacks exchangeability. IAS 21 is effective for annual reporting periods beginning on
or after January 1, 2025, with early application permitted.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
34
4. Expenses:
Recorded in operating and administrative expenses on the consolidated statements of comprehensive income
were the following amounts:
2024
2023
Salaries, wages and benefits
$ 108,276
$
105,517
Depreciation and amortization
33,968
30,529
Other
82,661
82,605
$ 224,905
$
218,651
5. Property, plant and equipment:
Buildings and land
improvements
Machinery and
equipment
Construction in
progress
Total
Cost:
Balance at January 1, 2023
$
82,768
$
547,941
$
79,210
$
709,919
Additions
-
9,425
126,715
136,140
Disposals
-
(963)
-
(963)
Balance at December 31, 2023
82,768
556,403
205,925
845,096
Balance at January 1, 2024
82,768
556,403
205,925
845,096
Additions
-
-
344,497
344,497
Transfers
-
1,260
(1,260)
-
Disposals
-
(2,488)
-
(2,488)
Balance at December 31, 2024
$
82,768
$
555,175
$
549,162
$
1,187,105
Accumulated depreciation:
Balance at January 1, 2023
$
42,110
$
278,334
$
-
$
320,444
Depreciation
1,723
21,934
-
23,657
Disposals
-
(872)
-
(872)
Balance at December 31, 2023
43,833
299,396
-
343,229
Balance at January 1, 2024
43,833
299,396
-
343,229
Depreciation
1,723
22,422
-
24,145
Disposals
-
(822)
-
(822)
Balance at December 31, 2024
$
45,556
$
320,996
$
-
$
366,552
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
35
6. Other intangible assets:
Computer
software
Construction in
progress
Total
Cost:
Balance at January 1, 2023
$
12,893
$
235
$
13,128
Additions
-
584
584
Balance at December 31, 2023
12,893
819
13,712
Balance at January 1, 2024
12,893
819
13,712
Additions
-
1,623
1,623
Balance at December 31, 2024
$
12,893
$
2,442
$
15,335
Accumulated amortization:
Balance at January 1, 2023
$
4,353
$
-
$
4,353
Depreciation
886
-
886
Balance at December 31, 2023
5,239
-
5,239
Balance at January 1, 2024
5,239
-
5,239
Depreciation
886
-
886
Balance at December 31, 2024
$
6,125
$
-
$
6,125
Carrying amounts:
At December 31, 2023
$
7,654
$
819
$
8,473
At December 31, 2024
6,768
2,442
9,210
Carrying amounts:
At December 31, 2023
$
38,935
$
257,007
$
205,925
$
501,867
At December 31, 2024
37,212
234,179
549,162
820,553
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
36
7. Net finance costs:
2024
2023
Interest income, net
$
(5,180)
$
(6,484)
Employee benefit interest expense, net
2,436
1,875
Capital lease interest
20,077
8,911
Net finance costs
$
17,333
$
4,302
8. Income tax expense:
2024
2023
Tax expense recognized in profit
Current income tax expense
$
49,483
$
46,876
Deferred tax recovery
(6,768)
(3,701)
42,715
43,175
Tax expense (recovery) recognized in other comprehensive income
Defined benefit plans
$
5,026
$
(1,703)
2024
2023
Reconciliation of effective tax rate:
Profit before income tax
$ 157,967
$
159,730
Statutory rate
27.00%
27.00%
Expected income tax expense
42,651
43,127
Permanent differences
71
49
Other
(7)
(1)
Actual income tax expense
$
42,715
$
43,175
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
37
9. Deferred tax assets and liabilities:
December 31,
December 31,
2024
2023
Deferred tax assets:
Non-pension defined benefits liability
$
17,436
$
18,819
Foreign exchange contracts
705
-
Lease obligation
119,182
75,031
Long term deferred revenue
98,092
28,775
Total assets
235,415
122,625
Deferred tax liabilities:
Property, plant, and equipment
(160,348)
(92,400)
Post-retirement benefits
(9,240)
(7,637)
Foreign exchange contracts
-
(293)
Right-of-use assets
(111,001)
(69,211)
Total liabilities
(280,589)
(169,541)
Net deferred income tax liabilities
$
(45,174)
$
(46,916)
10. Share capital:
Authorized:
Unlimited number of common shares, no par value
Issued:
Share Capital
2024
2023
61,769,766 (2023 - 62,514,675) issued and outstanding
common shares
$
1,419,472
$
1,436,587
The holders of the common shares are entitled to receive dividends as declared from time to time and are entitled
to one vote per share at meetings of the Corporation.
During the year ended December 31, 2024, the Corporation repurchased 744,909 (2023 - 314,784) shares for
$17,656,000 (2023 - $7,582,000), under the Corporation’s normal course issuer bid.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
38
The Corporation has declared dividends of $114,839,000 in 2024 (2023 - $87,520,000) as follows:
Record Date
Payment Date
Per Share
Total
March 31, 2024
April 15, 2024
$
0.725
$
45,323
June 30, 2024
July 15, 2024
0.375
23,188
September 30, 2024
October 15, 2024
0.375
23,164
December 31, 2024
January 15, 2025
0.375
23,164
$
114,839
11. Profit per share:
Earnings per share:
The calculation of basic profit per share for the year ended December 31, 2024 was based on profit attributable to
shareholders and a weighted average number of common shares outstanding.
2024
2023
Profit for the year
$
115,252
$
116,555
Weighted average number of Common shares outstanding
62,082,433
62,536,268
Basic and diluted earnings per share
$
1.86
$
1.86
The Corporation has no dilutive securities.
12. Employee future benefits:
The Corporation makes contributions to one non-contributory defined benefit plan and one non-contributory
defined contribution plan that provide pension benefits for employees upon retirement. The Corporation also
provides two non-contributory, other post-retirement benefit plans that provide retiring allowances and other
medical benefits after retirement.
December 31,
December 31,
2024
2023
Fair value of plan assets
$
169,367
$
160,687
Defined benefit pension obligations
(135,145)
(132,401)
Defined benefit pension asset
34,222
28,286
Other post-retirement benefit obligations
$
(64,579)
$
(69,701)
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
39
Plan assets are comprised of the following investments:
December 31,
December 31,
2024
2023
Equity securities
$
83,668
$
73,756
Fixed income securities
28,623
28,602
Alternatives
55,552
56,883
Cash and cash equivalents
1,524
1,446
$
169,367
$
160,687
Asset and Liability Movements:
Movement in the present value of the
defined benefit obligations
Pension obligations
Other post-retirement
benefits
December 31,
December 31,
2024
2023
2024
2023
Defined benefit obligation at January 1
$
132,401
$
121,262
$
69,701
$
61,852
Benefits paid by the plan
(8,248)
(7,225)
(2,346)
(2,422)
Current and past service costs and
interest (see below)
11,782
12,704
5,331
5,344
Actuarial losses (gains) in other
comprehensive income (see below)
(790)
5,660
(8,107)
4,927
Defined benefit obligations
$
135,145
$
132,401
$
64,579
$
69,701
Movement in the fair value of the
defined benefit plan assets
Pension assets
Other post-retirement
benefits
December 31,
December 31,
2024
2023
2024
2023
Fair value of plan assets at January 1
$
160,687
$ 155,866 $
-
$
-
Contributions paid into the plan
-
-
2,346
2,422
Benefits paid by the plan
(8,248)
(7,225)
(2,346)
(2,422)
Expected return on plan assets (see below)
7,431
7,987
-
-
Non-investment expense (see below)
(220)
(220)
-
-
Actuarial gains in other
comprehensive income (see below)
9,717
4,279
-
-
Fair value of plan assets
$
169,367
$ 160,687 $
-
$
-
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
40
Profit and Loss:
Profit and loss includes the following amounts in respect of post-retirement obligations:
Pension obligations expense recognized in profit and loss
2024
2023
Service costs:
Current service costs
$
1,349
$
1,348
Past service costs
3,961
4,828
Non-investment expenses
220
220
5,530
6,396
Net interest costs:
Interest cost
6,472
6,528
Expected return on plan assets
(7,431)
(7,987)
(959)
(1,459)
$
4,571
$
4,937
Actuarial gains (losses) recognized in other comprehensive income
2024
2023
Cumulative amount at beginning of year
$
78,010
$
84,318
Actuarial gain - plan experience
1,672
653
Actuarial gain - demographic assumption changes
1,364
-
Actuarial gain (loss) - financial assumption changes
5,861
(11,240)
Return on plan assets greater than expected return
9,717
4,279
Cumulative amount at December 31
$
96,624
$
78,010
Other post-retirement benefits expense recognized in profit and loss
2024
2023
Current service costs
$
1,936
$
1,642
Past service costs
-
368
Interest costs
3,395
3,334
$
5,331
$
5,344
The current and past service costs are recognized in operating expenses and net interest costs are included in
net finance costs.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
41
Funding and Assumptions:
The defined benefit pension plan is entirely funded by the Corporation. The Corporation’s contributions to its
defined benefit pension plan is based on independent actuarial valuations. The other benefit plans have no assets,
and an annual expense is recorded on an accrual basis based on independent actuarial determinations, considering
among other factors, health care cost escalation.
During the year ended December 31, 2024, the Corporation made total contributions of $2,346,000 (2023 -
$2,422,000) to its other benefits plans.
The financial information with respect to the defined benefit pension plan obligations is based on the following
funding valuation:
Most recent valuation
date
Date of next required
valuation
Pension plan
January 1, 2024
January 1, 2025
For measurement purposes, the per capita cost of covered extended health care and dental benefits is assumed to
increase based on the MacMaster study with the Canadian Institute of Actuaries. The per annum increase
(adjusted for increased short-term inflation) in 2024 was 7.10% for extended health care benefits and 6.36% for
dental benefits. The trend rates modelled for each health care benefit converge to 4.05% in 2040 and are
forecasted to stay at that level through 2050 and beyond.
The significant actuarial assumptions adopted in measuring the Corporation's accrued benefit obligations (and
costs) are as follows (weighted average assumptions as of December 31):
2024
2023
Pension
benefits
Other
benefits
Pension
benefits
Other
benefits
Benefit obligations:
Discount rate at December 31
4.75%
4.75%
4.75%
4.75%
Benefit costs:
Discount rate at January 1
4.75%
4.75%
5.25%
5.25%
Expected long-term rate of return on plan
4.75%
-
5.25%
-
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
42
Sensitivity Analysis:
Assumed discount rates and medical cost trend rates have a significant effect on the accrued benefit obligation. A
one percentage point change in these assumptions would have the following effects on the accrued benefit
obligation for 2024:
1% decrease
1% increase
Pension benefit plans
Discount rate
$
13,686
$
(13,686)
Other post-retirement benefit plans
Discount rate
10,554
(10,554)
Initial medical cost trend rate
(8,350)
8,350
13. Loans and borrowings:
The Corporation has a $40 million operating facility that is used for a letter of credit relating to pension funding
and day to day operations. The facility matures on August 31, 2025, and is secured by a pledge of all of the assets
of the Corporation. The operating facility bears interest at a variable rate plus a margin and no repayments will be
required until maturity. There is an outstanding letter of credit of $1.3 million (December 31, 2023 - $11.4 million)
which is the only amount drawn on this facility (see note 17).
Under its credit facility, the Corporation is required to comply with certain financial covenants. At December 31,
2024, the Corporation was in compliance with these financial covenants.
For more information about the Corporation’s exposure to interest rate, foreign currency and liquidity risk, please
see note 19.
14. Financial instruments:
The carrying amounts of financial assets and liabilities reported in the consolidated statement of financial position
approximate their fair values.
IFRS 13, Fair Value Measurement, requires classification of financial instruments within a hierarchy that prioritizes
the inputs to fair value measurement. The three levels of the fair value hierarchy are:
Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 – Inputs other than quoted prices that are observable for the asset or liability, directly or indirectly;
Level 3 – Inputs that are not based on observable market data.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
43
Financial instruments carried at fair value, by the levels in the fair value hierarchy, are as follows:
Fair Value Hierarchy
December
December 31,
Level
2024
2023
Financial assets:
Derivative instruments:
Foreign exchange contracts
Level 2
$
-
$
1,083
Financial liabilities:
Derivative instruments:
Foreign exchange contracts
Level 2
$
2,611
$
-
As at December 31, 2024, Westshore has entered into option collars with notional amounts totaling US$66.0 million
to exchange U.S. dollars for Canadian dollars if the strike price drops below $1.330 or increases above $1.405. These
foreign exchange contracts have not been designated as hedges.
The following table summarizes the gains (losses) on foreign exchange contracts for the years ended December 31,
2024 and 2023:
2024
2023
Foreign exchange contracts
$
(3,694)
$
1,756
The fair value asset and liability are recorded in other assets and other liabilities, respectively. The unrealized gain
(loss) was recorded in foreign exchange gain (loss) in the consolidated statements of comprehensive income.
The carrying amounts of these contracts are equal to fair value, which is based on valuations obtained from the
counterparties. The mark-to-market value is determined by the counterparty by multiplying the notional amount
of the trade with the difference between the forward rate and the contract rate and discounting the resultant asset
or liability by an applicable discount factor.
15. Deferred revenue
During the year, the Corporation recognized $21.3 million (2023 – nil) of previously paid customer reservation
fees of in other revenue due to termination of contract.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
44
BHP Potash Capital Project:
During the year ended December 31, 2024, the Corporation invoiced $256,728,000 (2023 - $52,670,000) to BHP
Canada Inc., a subsidiary of BHP Group (“BHP”) related to the construction of the necessary infrastructure to
enable it to handle potash. These non-refundable upfront fees received from BHP are recorded as deferred
revenue and will be recognized when the corresponding future service is provided over the course of the export
contract. At December 31, 2024, the total long term deferred revenue related to the BHP project is $363,303,000
(2023 - $106,575,000). The amount invoiced also includes a 5% holdback which is recorded as long term
receivable, to be received upon the completion of the project. As at December 31, 2024, the holdback amount
was $18,165,000 (December 31, 2023 - $5,329,000).
16. Leases:
The Corporation is committed to low value, short term leases related to the rental of vehicles and equipment.
The Corporation has a land lease with the Vancouver Fraser Port Authority (“VFPA”) which has been identified
as a material lease contract. In February 2024, our lease with VFPA was amended, with retroactive effect as of
January 1, 2023 (the “Amended Lease”). The term of the Amended Lease is January 1, 2023 to December 31,
2051, with Westshore having further options to extend the term to December 31, 2070. The Amended Lease has
been accounted for as a lease modification in 2024, in accordance with IFRS 16 Leases. As a result, the
Corporation’s lease liability was remeasured by applying an incremental borrowing rate of 4.60% as the discount
rate and assumes the extension of the lease to December 31, 2070.
Under the Amended Lease, annual rent is comprised of two fixed amounts, basic rent and ancillary rent. The
basic rent is fixed until December 31, 2026, and may be revised by VFPA at that time and every three years
thereafter. The ancillary rent will escalate annually by 5% per annum until 2027, thereafter based on the Consumer
Price Index (CPI). Unlike the old lease, the Amended Lease does not provide for an annual participation rental
fee based on the volume of coal shipped (2023 - $6,494,000).
Additional information about this lease, including the effects of the modification, is presented below. No other
material lease contracts were identified.
Right-of-use asset
2024
2023
Balance at January 1
$
256,337
$
262,165
Adjustment for lease modification
163,715
-
Other adjustments
-
158
Depreciation charge for the year
(8,937)
(5,986)
Balance at December 31
$
411,115
$
256,337
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
45
Lease obligation
2024
2023
Balance at January 1
$
277,890
$
280,575
Adjustment for lease modification
163,715
-
Interest accretion
20,077
8,911
Lease payments
(20,268)
(11,596)
Balance at December 31
441,414
277,890
Less: Current lease obligation
(550)
(3,024)
Long term lease obligation
$
440,864
$
274,866
Lease obligation
2024
Maturity analysis – contractual undiscounted cash flows
Less than one year
$
20,711
One to five years
90,356
More than five years
946,807
Total undiscounted lease liabilities at year end
$ 1,057,874
Amounts recognized in profit or loss
2024
2023
Interest on lease liabilities
$
20,077
$
8,911
Variable lease payments not included in the measurement of lease
liabilities
-
8,750
Expenses relating to short-term and low value asset leases
195
208
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
46
Amounts recognized in the statement of cash flows
2024
2023
Cash used in operations:
Variable lease payments included in profit for the year
$
- $
8,750
Short-term and low value asset leases included in profit for the year
195
208
Lease obligation interest paid
20,077
8,911
20,272
17,869
Cash used in financing:
Lease obligation
191
2,685
Total cash outflow for leases
$
20,463
$
20,554
17. Commitments and Contingencies:
The Corporation has provided a letter of credit of $1,312,000 (December 31, 2023 - $11,418,000) related to
pension funding.
The Corporation continues to enter into contracts with various vendors for the construction of the potash capital
improvements. Pursuant to the agreement, BHP is required to fund the capital improvements up to the agreed
budget, with Westshore being responsible for all amounts in excess of the agreed budget. As at December 31,
2024, the Corporation has commitments related to this project of $349,235,000 that have not been accrued for.
18. Major Customers:
The Corporation had certain customers whose throughput individually represented 10% or more of the
Corporation’s total throughput.
For the year ended December 31, 2024, three customers accounted for 76% (2023 - 79%) and four customers
accounted for 95% (2023 - 92%) of throughput.
19. Financial risk management:
The Corporation is exposed to various risks associated with its financial instruments, which include credit risk,
liquidity risk and market risk. Further quantitative disclosures are included throughout these consolidated financial
statements.
(a) Credit risk:
Credit risk is the risk of financial loss to the Corporation if a customer or counterparty to a financial instrument
fails to meet its contractual obligations. Credit risk arises primarily from accounts receivable and cash and cash
equivalents. Credit risk can also arise on foreign currency contracts held by the Corporation.
The Corporation’s exposure to credit risk is primarily influenced by the profitability of coal mining companies,
which is heavily impacted by the price of coal. The Corporation does not have any collateral or security for its
receivables. The Corporation monitors the financial health of its customers and regularly reviews its accounts
receivable for impairment. As at December 31, 2024 and 2023, there were no trade accounts receivable past
due which were considered uncollectible and no reserve in respect of doubtful accounts was recorded.
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
47
The Corporation limits its exposure to credit risk arising from cash equivalents by only investing in money
market funds with a major Canadian financial institution. The Corporation does not expect any credit losses in
the event of non-performance by counter parties to its foreign exchange forward contracts as the counter
parties are major Canadian financial institutions.
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to
credit risk is:
2024
2023
Cash and cash equivalents
$
136,593
$
164,747
Accounts receivable
33,143
41,821
Long term receivable
18,165
5,329
$
187,901
$
211,897
(b) Liquidity risk:
Liquidity risk is the risk that the Corporation will not be able to meet its obligations as they become due. The
Corporation continually monitors its financial position to ensure that it has sufficient liquidity to discharge its
obligations when due.
The current financial liabilities of the Corporation, which include accounts payable and accrued liabilities,
income tax payable, other liabilities and dividends payable to shareholders, have a contractual maturity of less
than 1 year.
The Corporation also maintains a $40 million operating facility that is primarily used for pension funding. The
Corporation has an outstanding letter of credit for $1,312,000 against this facility.
(c) Market risk:
The significant market risk exposures affecting the financial instruments held by the Corporation are those
related to foreign currency exchange rates and interest rates.
(i) Foreign currency exchange rates:
The Corporation holds some cash denominated in foreign currencies and the Canadian dollar value of
these cash balances fluctuates with changes in the exchange rate. As at December 31, 2024, the Corporation
held US$9.2 million (2023 – US$17.8 million). A $0.01 increase in the US/Canadian exchange rate would
have increased the Canadian dollar value of this cash balance and increased foreign exchange gains by
$92,000 for the year.
The accounts receivable due from U.S. customers are denominated in U.S. dollars. The U.S. dollar
denominated accounts receivable outstanding as at December 31, 2024 was $5,275,000 (2023 - $9,115,000).
WESTSHORE TERMINALS INVESTMENT CORPORATION
Notes to the Consolidated Financial Statements
(Tabular amounts expressed in thousands of Canadian dollars, except share amounts)
Years ended December 31, 2024 and 2023
48
The Corporation is exposed to foreign currency exchange rate risk on its foreign currency contracts. The
value of these financial instruments fluctuates with changes in the US/CAD dollar exchange rate. See note
14 for more information.
(ii) Interest rates:
The Corporation has limited exposure to interest rate risk on the cash equivalents. Money market fund
returns are correlated with Canadian T-bills and Bankers’ Acceptances of major Canadian financial
institutions.
The Corporation also has interest rate risk on the revolving credit facility. The revolving credit facility
carries an interest rate that floats with market rates.
20. Capital management:
The capital of the Corporation consists solely of shareholders’ equity which includes issued share capital and deficit.
The objective of the Corporation is to maintain a stable capital base and ensure that the capital structure does not
interfere with the Corporation’s ability to meet its distribution policy or fund future projects. The Corporation’s
quarterly dividend is subject to periodic review based on factors including funds applied to repurchase shares, other
opportunities that may come before Westshore, other potential capital upgrade projects, operating performance
and current market conditions.
21. Related party transactions:
2024
2023
Administration agreement:
Westar Management Ltd.
$
633
$
615
Management agreement:
Westar Management Ltd. - base fee
1,900
1,845
Management agreement:
Westar Management Ltd. - Incentive fee
5,235
4,743
Insurance premiums:
Affiliate of Westar Management Ltd.
1,981
2,277
Vehicle leases:
Affiliate of Westar Management Ltd.
195
208
Director fees:
Director fees
872
823
Accounts payable and accrued liabilities include $5,456,000 (2023 - $4,974,000) due to affiliated companies.
Corporate Information
49
Westshore Terminals Investment Corporation
Directors
William W. Stinson
Corporate Director
M. Dallas H. Ross
Partner, Kinetic Capital Partners
H. Clark Hollands
Private Investor
Steve Akazawa
Corporate Director
Brian A. Canfield
Corporate Director
Nick Desmarais
Managing Director Legal Services, The Jim Pattison
Group
Glen Clark
Corporate Director
Dianne Watts
Corporate Director
Officers
William W. Stinson
Chairman, Chief Executive Officer &President
M. Dallas H. Ross
Chief Financial Officer
Nick Desmarais
Secretary & Vice President of Corporate Development
Stock Exchange Listing
Toronto Stock Exchange
Trading Symbol
WTE
Registrar and Transfer Agent
Computershare Investor Services Inc.
Vancouver and Toronto
Auditors
KPMG LLP
Vancouver, British Columbia
Principal Office
1800 – 1067 West Cordova Street
Vancouver, British Columbia V6C 1C7
Telephone:
604.688.6764
Facsimile:
604.687.2601
Corporate Information
50
Westshore Terminals Ltd.
William W. Stinson
Corporate Director
M. Dallas H. Ross
Partner, Kinetic Capital Partners
H. Clark Hollands
Private Investor
Steve Akazawa
Corporate Director
Brian A. Canfield
Corporate Director
Nick Desmarais
Managing Director Legal Services, The Jim Pattison
Group
Glen Clark
Corporate Director
Dianne Watts
Corporate Director