Investment Strategy

Overall Company Strategy

• Grow customer base through targeted geographic expansion.
• Grow product and service line offering.
• Ensure the Corporation has a strong balance sheet to support its growth objectives.

Organic growth

This consists of growing revenue, improving margins and controlling costs in order to grow Churchill’s earnings. We do this in several ways:

• We continuously improve our discipline regarding business origination and business development.
  • We focus our best people on the highest value projects and treat project bids like a portfolio.
  • We work to improve our margins without increasing the risk profile of the portfolio.
• We try to be as efficient and effective as possible in project execution to get everything we can out of the backlog that we've got in place.
  • For example, we are implementing a new enterprise resource planning system that will improve our monitoring and control of project costs and parameters, allowing us to better minimize project spend and improve estimating capabilities.
• We focus on bigger projects, which have more opportunities to improve margins.
• We increase self-performed work in situations where the economics are favourable.

Acquisitions

We look for accretive acquisitions — transactions that will grow our financial results on a per share basis:

• We currently see opportunities for potential tuck-in acquisitions for all of our business units. These would be smaller transactions (less than $20 million) that would broaden the product offering or geographical footprint of the business unit or add strength in areas where it would be beneficial.
• As well, we are not ruling out larger acquisitions where they fit our entrepreneurial culture, enhance our strategic goals, and improve our financial results.

Capital structure

We work with our financial and legal advisors to maintain and improve Churchill’s ability to access equity and various debt capital markets to:

• Minimize our financing costs;
• Support our corporate growth strategy; and
• Facilitate shareholder value creation.

Consolidation

The Canadian construction industry is made up of a few large companies with relatively broad product offerings and many smaller players that offer very specialized products and services. As part of our growth strategy, we are working to broaden our product offering to our largely repeat customer base by acquiring other construction companies, both large and small, and thus consolidating the sector.