Company Announcements

NANAIMO, BC , Sept. 16, 2024 /CNW/ - Atlas Engineered Products ("Atlas", "AEP" or the "Company") (TSXV: AEP) (OTC Markets: APEUF) announces that the Company has completed due diligence for a truss manufacturing company located in Western Canada (the "Target") and intends to close the transaction in early Spring of 2025.

 "We are excited to announce the completion of due diligence for the Target. This is the most robust M&A pipeline we have ever seen and now is the time to move forward with strategic acquisitions that expands our reach into new locations as we continue to grow our national footprint," said Hadi Abassi, CEO & President, Founder. "We are progressing with acquisitions and steadily advancing our organic growth initiatives, including robotic implementation. Recently, we have expanded our sales team to capture more market share and enhance our sales presence in the U.S. market. These approaches ensure our continuous growth and expansion, aligning with both our short-term and long-term strategic goals."

The Company will now start working on a share purchase agreement where AEP intends to acquire all the issued and outstanding shares of the Target (the "Proposed Transaction") for the purchase price of $3.8 million in cash and stock, plus a working capital adjustment to be determined and finalized after closing of the transaction. The land and buildings on which the Target's facilities are located will be leased from the current owners and terms will be finalized while working on the share purchase agreement. The Target generated a previous 3-year average revenues of over $11 million, net income of approximately $950,000 and non-IFRS measure adjusted EBITDA of approximately $1.15 million (see "Non-GAAP/Non-IFRS Financial Measures"). This Proposed Transaction will potentially be financed using a combination of the Company's existing cash, common shares of the Company issued to the vendor, and bank financing. AEP is currently assessing which combination of financing is the best strategically for the short- and long-term growth plans of the Company.

This Proposed Transaction is aligned with the Company's strategic acquisition plan and expands our geographical reach. AEP will bring its considerable operating synergies and material buying power to this anticipated new addition to the AEP group of companies.

The Company will release more details at time of closing of the Proposed Transaction which is targeted for early Spring of 2025. Closing of the Proposed Transaction also remains subject to a number of conditions, including the approval of the TSX Venture Exchange (the "Exchange"), if such approval is required under the rules and policies of the Exchange.

Non-GAAP / Non-IFRS Financial Measures

Certain financial measures in this news release do not have any standardized meaning under IFRS and, therefore are considered non-IFRS or non-GAAP measures. These non-IFRS measures are used by management to facilitate the analysis and comparison of period-to-period operating results for AEP and to assess whether AEP's operations are generating sufficient operating cash flow to fund working capital needs and to fund capital expenditures. As these non-IFRS measures do not have any standardized meaning under IFRS, these measures may not be comparable to similar measures presented by other issuers. The non-IFRS measures used in this news release may include "EBITDA", "EBITDA margin", "adjusted EBITDA", "adjusted EBITDA margin", "normalized EBITDA" and "normalized EBITDA margin". For a description of the composition of these measures, please refer to AEP's Management's Discussion and Analysis for the period ended March 31, 2023 under "Non-IFRS / Non-GAAP Financial Measures", available on AEP's website at www.atlasengineeredproducts.com or on SEDAR at www.sedar.com.

About Atlas Engineered Products Ltd.

AEP is a growth company that is acquiring and operating profitable, well-established operations in Canada's truss and engineered products industry. We have a well-defined and disciplined acquisition and operating growth strategy enabling us to scale aggressively and apply new technologies, giving us a unique opportunity to consolidate a fragmented industry of independent operators.

www.atlasengineeredproducts.com

FORWARD LOOKING INFORMATION
Information set forth in this news release contains forward-looking statements. These statements reflect management's current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. Although AEP believes that the expectations reflected in the forward looking statements are reasonable, there is no assurance that such expectations will prove to be correct, or that such future events will occur in the disclosed time frames or at all. AEP cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond AEP's control. Such factors include, among other things: risks and uncertainties related to the housing market, changes in interest rates and other risks and uncertainties relating to AEP, including those described in the Management's Discussion and Analysis ("MD&A") for AEP's three and six months ended June 30, 2024. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. Except as required under applicable securities legislation, AEP undertakes no obligation to publicly update or revise forward-looking information.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

SOURCE Atlas Engineered Products Ltd.