FirstService Reports Record Fourth Quarter and Full Year Results
(Thomson Reuters ONE) -
* Global revenue up 18% and Adjusted EPS up 28% for the year
* Colliers International revenue up 24% and Adjusted EBITDA up 38% for 2014
Announces plan to separate into two independent public companies: Colliers
International and FirstService Corporation
Operating highlights:
Three months Year ended
ended
December 31 December 31
2014 2013 2014 2013
Revenues (millions) $ 823.8 $ 691.9 $ 2,714.3 $ 2,344.6
Adjusted EBITDA (millions) (note 1) 80.4 72.9 221.7 183.9
Adjusted EPS (note 2) 1.16 0.96 2.73 2.13
TORONTO, Feb. 10, 2015 (GLOBE NEWSWIRE) -- FirstService Corporation (TSX:FSV)
(Nasdaq:FSRV) today announced record fourth quarter and full year results for
the year ended December 31, 2014. All amounts are in US dollars and all
percentage revenue variances are calculated on a local currency basis.
Revenues for the fourth quarter were $823.8 million, a 22% increase relative to
the same quarter in the prior year. Adjusted EBITDA (note 1) was $80.4 million,
up 10%, and Adjusted EPS (note 2) was $1.16, up 21% from the prior year quarter.
GAAP EPS from continuing operations was $0.45 per share in the quarter, compared
to $0.11 for the same quarter a year ago.
For the year ended December 31, 2014, revenues were $2.71 billion, an 18%
increase relative to the prior year. Adjusted EBITDA was $221.7 million, up
21%. Adjusted EPS was $2.73, up 28% versus the prior year. GAAP EPS from
continuing operations for the year was $1.15, compared to a loss of $0.48 in the
prior year. The prior year was negatively impacted by accelerated amortization
of intangible assets and one-time re-branding related costs in connection with
the re-branding of the Company's residential real estate services operations to
"FirstService Residential". Cash flow from operations was a record $159.1
million, up 37% versus the prior year.
"We finished 2014 with record results and tremendous opportunities to continue
creating value for shareholders," said Jay S. Hennick, Founder and Chief
Executive Officer of FirstService. "We also announced an exciting plan to
separate the Company into two independent public companies: Colliers
International, one of the top three global players in commercial real estate;
and FirstService Corporation, the North American leader in residential property
management and property services. After the separation, FirstService Corporation
will be comprised of the FirstService Residential and FirstService Brands
divisions. The spin-off transaction is planned as a tax-free distribution to
shareholders and is expected to be completed in the second quarter of 2015."
"I am particularly excited about this important development in the evolution of
our company; the creation of two, billion dollar real estate service companies.
Each company has a distinct brand, customers and industry dynamics. By
separating, each company will be able to intensify its focus on core markets and
customers and have the flexibility to pursue independent value creation
strategies while optimizing its capital structure and financial resources. For
shareholders, the separation creates two different yet compelling investment
opportunities attracting appropriate investors and offering better comparability
with publically traded peers. Operationally, I will assume the role of Executive
Chairman of Colliers and Chairman of FirstService and will continue to control
and provide oversight and stewardship of both companies over the long-term.
Scott Patterson will take on the role of CEO of FirstService, John Friedrichsen
will become the CFO of Colliers and other key executives will remain in place,"
he concluded.
About FirstService Corporation
FirstService Corporation is a global leader in the rapidly growing real estate
services sector, one of the largest markets in the world. As one of the largest
property managers in the world, FirstService manages more than 2.5 billion
square feet of residential and commercial properties through its three industry-
leading service platforms: Colliers International, one of the largest global
players in commercial real estate services; FirstService Residential, North
America's largest manager of residential communities; and FirstService Brands,
one of North America's largest providers of essential property services
delivered through company-owned operations and franchise systems.
FirstService generates over US$2.7 billion in annual revenues and has more than
24,000 employees worldwide. With significant insider ownership and an
experienced management team, FirstService has a long-term track record of
creating value and superior returns for shareholders since becoming a publicly
listed company in 1993. The shares of FirstService trade on the NASDAQ under the
symbol "FSRV" and on the Toronto Stock Exchange under the symbol "FSV". More
information about FirstService is available at www.firstservice.com
Segmented Fourth Quarter Results
Colliers International revenues totalled $541.6 million for the fourth quarter,
compared to $433.3 million in the prior year quarter, up 28%. The revenue
increase was comprised of 20% internal growth and 8% growth from recent
acquisitions. Internal growth was led by the EMEA and Asia Pacific regions, both
of which had strong year over year gains in investment sales, leasing and
consulting. Adjusted EBITDA was $72.4 million, up 18% versus the prior year
quarter.
FirstService Residential revenues totalled $227.9 million for the fourth
quarter, up 10% relative to the prior year quarter. The revenue increase was
comprised of 7% internal growth from new property management contract wins and
3% from recent acquisitions. Adjusted EBITDA was $6.9 million, versus $10.5
million in the prior year period. Results were impacted by significantly higher
employee medical benefits costs in the US during 2014.
FirstService Brands revenues totalled $54.3 million, up 8% versus the prior year
period. The increase was comprised of 5% internal growth and 3% from recent
acquisitions. Adjusted EBITDA for the quarter was $9.0 million, up 7% versus the
prior year quarter. Each of the franchise brands reported strong increases in
system-wide sales and royalties.
Corporate costs were $7.9 million in the fourth quarter, relative to $7.4
million in the prior year period.
Segmented Full Year Results
Colliers International annual revenues for 2014 totalled $1.58 billion, compared
to $1.31 billion in the prior year, up 24%. The revenue increase was comprised
of 16% internal growth and 8% growth from acquisitions. Adjusted EBITDA for
2014 was $157.4 million, up 38% versus the prior year, with margins up 110 basis
points due to increased broker productivity and operating leverage.
FirstService Residential revenues were $919.5 million, up 9% relative to 2013,
with the increase comprised of 7% internal growth and 2% from acquisitions.
Adjusted EBITDA was $45.6 million, down 14% versus the prior year, and was
impacted by $9.0 million of incremental US employee medical benefits costs
incurred during the year. The Company has redesigned its health plans and
adjusted cost sharing with clients and employees effective January 1, 2015, with
the result that costs will return to a normalized burden rate for 2015 and
beyond.
FirstService Brands revenues for the year totalled $212.5 million, up 11% versus
the prior year, comprised of internal growth of 9% and 2% from acquisitions.
Adjusted EBITDA for the year was $37.8 million, up 13% relative to the prior
year, due to operating leverage on royalties from increasing system-wide sales
at the division's franchise brands.
Corporate costs were $19.0 million for the full year, relative to $17.3 million
in the prior year.
Stock Repurchases
During the fourth quarter, the Company repurchased 162,300 Subordinate Voting
Shares on the open market under its Normal Course Issuer Bid ("NCIB") at an
average price of $52.46 per share. All shares purchased under the NCIB were
cancelled. The Company is authorized to repurchase up to an additional
2,627,073 Subordinate Voting Shares under its NCIB, which expires on June
8, 2015.
Appointment of Director
On February 10, 2015, John (Jack) P. Curtin was appointed to the Board of
Directors of the Company, and will also serve as a member of the Audit
Committee. Mr. Curtin is an Advisory Director in the Investment Banking Division
of Goldman Sachs & Co. in Toronto and New York, and prior to December 2014
served as Chairman and CEO of Goldman Sachs Canada Inc.
Plan to Separate into Two Independent Public Companies
FirstService separately announced today that its Board of Directors has
approved, in principle, a plan to separate into two independent public
companies: Colliers International, one of the top three global leaders in
commercial real estate; and FirstService Corporation, to be comprised of the
Company's FirstService Residential and FirstService Brands operations. The
separation is being planned as a spin-off, resulting in a tax-free distribution
of shares to shareholders. The plan, which is subject to the Company obtaining
tax rulings, regulatory approval and shareholder approval, is expected to be
completed in the second quarter of 2015.
Conference Call & Presentation
FirstService will be holding a conference call on Wednesday, February 11, 2015
at 11:00 a.m. Eastern Time to discuss results for the fourth quarter and full
year, as well as the planned separation into two independent public companies.
The Company has posted a presentation in the Investors / Newsroom section of its
website that provides an overview of the separation. The call will be
simultaneously web cast and can be accessed live or after the call at
www.firstservice.com in the Investors / Newsroom section.
Forward-looking Statements
This press release includes or may include forward-looking statements. Forward-
looking statements include the Company's financial performance outlook and
statements regarding goals, beliefs, strategies, objectives, plans or current
expectations. These statements involve known and unknown risks, uncertainties
and other factors which may cause the actual results to be materially different
from any future results, performance or achievements contemplated in the
forward-looking statements. Such factors include: (i) general economic and
business conditions, which will, among other things, impact demand for the
Company's services and the cost of providing services; (ii) the ability of the
Company to implement its business strategy, including the Company's ability to
acquire suitable acquisition candidates on acceptable terms and successfully
integrate newly acquired businesses with its existing businesses; (iii) changes
in or the failure to comply with government regulations; and (iv) other factors
which are described in the Company's filings with applicable Canadian and United
States securities regulatory authorities (which factors are adopted herein).
Summary financial information is provided in this press release. This press
release should be read in conjunction with the Company's consolidated financial
statements and MD&A to be made available on SEDAR at www.sedar.com.
Notes
1. Reconciliation of net earnings from continuing operations to adjusted EBITDA:
Adjusted EBITDA is defined as net earnings from continuing operations, adjusted
to exclude: (i) income tax; (ii) other expense (income); (iii) interest expense;
(iv) depreciation and amortization; (v) acquisition-related items; and (vi)
stock-based compensation expense. The Company uses adjusted EBITDA to evaluate
its own operating performance and its ability to service debt, as well as an
integral part of its planning and reporting systems. Additionally, this measure
is used in conjunction with discounted cash flow models to determine the
Company's overall enterprise valuation and to evaluate acquisition targets.
Adjusted EBITDA is presented as a supplemental measure because the Company
believes such measure is useful to investors as a reasonable indicator of
operating performance because of the low capital intensity of its service
operations. The Company believes this measure is a financial metric used by many
investors to compare companies, especially in the services industry. This
measure is not a recognized measure of financial performance under GAAP in the
United States, and should not be considered as a substitute for operating
earnings, net earnings from continuing operations or cash flow from operating
activities, as determined in accordance with GAAP. The Company's method of
calculating adjusted EBITDA may differ from other issuers and accordingly, this
measure may not be comparable to measures used by other issuers. A
reconciliation of net earnings from continuing operations to adjusted EBITDA
appears below.
Three months Twelve months ended
ended
(in thousands of US$) December 31 December 31
2014 2013 2014 2013
Net earnings from continuing operations $ 37,798 $ 28,055 $ 89,399 $ 46,601
Income tax 10,660 16,054 31,799 22,204
Other expense (income) 25 312 (1,008) (1,524)
Interest expense, net 4,403 4,220 14,237 21,499
Operating earnings 52,886 48,641 134,427 88,780
Depreciation and amortization 18,250 14,592 62,410 71,882
Acquisition-related items 5,870 2,118 11,825 10,498
Stock-based compensation expense 3,414 7,526 13,083 12,733
Adjusted EBITDA $ 80,420 $ 72,877 $ 221,745 $ 183,893
2. Reconciliation of net earnings from continuing operations and net earnings
(loss) per common share from continuing operations to adjusted net earnings and
adjusted net earnings per share:
Adjusted EPS is defined as diluted net earnings (loss) per common share from
continuing operations, adjusted for the effect, after income tax, of: (i) the
non-controlling interest redemption increment; (ii) acquisition-related items;
(iii) amortization of intangible assets recognized in connection with
acquisitions; and (iv) stock-based compensation expense. The Company believes
this measure is useful to investors because it provides a supplemental way to
understand the underlying operating performance of the Company and enhances the
comparability of operating results from period to period. Adjusted EPS is not a
recognized measure of financial performance under GAAP, and should not be
considered as a substitute for diluted net earnings per common share from
continuing operations, as determined in accordance with GAAP. The Company's
method of calculating this non-GAAP measure may differ from other issuers and,
accordingly, this measure may not be comparable to measures used by other
issuers. A reconciliation of diluted net earnings (loss) per common share from
continuing operations to adjusted EPS appears below.
Three months Twelve months ended
ended
(in thousands of US$) December 31 December 31
2014 2013 2014 2013
Net earnings from $ 37,798 $ 28,055 $ 89,399 $ 46,601
continuing operations
Non-controlling interest (8,437) (5,749) (28,200) (18,027)
share of earnings
Preferred share dividends -- -- -- (3,146)
Acquisition-related items 5,870 2,118 11,825 10,498
Amortization of intangible 6,303 5,989 24,293 37,141
assets (1)
Stock-based compensation 3,414 7,526 13,083 12,731
expense
Income tax on adjustments (2,532) (2,275) (9,724) (11,004)
Non-controlling interest on (553) (910) (1,649) (4,076)
adjustments
Adjusted net earnings $ 41,863 $ 34,754 $ 99,027 $ 70,718
Three months Twelve months ended
ended
(in US$) December 31 December 31
2014 2013 2014 2013
Diluted net earnings (loss)
per common share from $ 0.45 $ 0.11 $ 1.15 $ (0.48)
continuing operations
Non-controlling interest 0.36 0.51 0.53 1.25
redemption increment
Acquisition-related items 0.16 0.05 0.31 0.30
Amortization of intangible 0.11 0.10 0.43 0.73
assets, net of tax (1)
Stock-based compensation 0.08 0.19 0.31 0.33
expense, net of tax
Adjusted earnings per share $ 1.16 $ 0.96 $ 2.73 $ 2.13
(1) Amortization of intangible assets for the year ended December 31, 2013
includes $11,153 ($0.26 per share) of accelerated amortization related to
legacy regional trademarks and trade names in connection with Residential Real
Estate Services re-branding.
FIRSTSERVICE
CORPORATION
Operating Results
(in thousands of US$,
except per share
amounts)
Three months Twelve months
ended December 31 ended December 31
(unaudited) 2014 2013 2014 2013
Revenues $ 823,826 $ 691,857 $ 2,714,273 $ 2,344,625
Cost of revenues 521,375 428,309 1,747,175 1,523,277
Selling, general and
administrative 225,446 198,197 758,436 650,188
expenses
Depreciation 11,946 8,603 38,117 34,741
Amortization of 6,303 5,989 24,293 37,141
intangible assets
Acquisition-related 5,870 2,118 11,825 10,498
items (1)
Operating earnings 52,886 48,641 134,427 88,780
Interest expense, net 4,403 4,220 14,237 21,499
Other expense (income) 25 312 (1,008) (1,524)
Earnings before income 48,458 44,109 121,198 68,805
tax
Income tax 10,660 16,054 31,799 22,204
Net earnings from 37,798 28,055 89,399 46,601
continuing operations
Discontinued
operations, net of 593 (2,713) 1,537 (5,183)
income tax (2)
Net earnings 38,391 25,342 90,936 41,418
Non-controlling
interest share of 8,437 5,749 28,200 18,027
earnings
Non-controlling
interest redemption 12,980 18,373 19,420 41,430
increment
Net earnings (loss)
attributable to 16,974 1,220 43,316 (18,039)
Company
Preferred share -- -- -- 3,146
dividends
Net earnings (loss)
attributable to common $ 16,974 $ 1,220 $ 43,316 $ (21,185)
shareholders
Net earnings (loss)
per common share
Basic
Continuing operations $ 0.46 $ 0.11 $ 1.16 $ (0.48)
Discontinued 0.01 (0.08) 0.04 (0.16)
operations
$ 0.47 $ 0.03 $ 1.20 $ (0.64)
Diluted
Continuing operations $ 0.45 $ 0.11 $ 1.15 $ (0.48)
Discontinued 0.01 (0.08) 0.04 (0.16)
operations
$ 0.46 $ 0.03 $ 1.19 $ (0.64)
Adjusted earnings per $ 1.16 $ 0.96 $ 2.73 $ 2.13
share (3)
Weighted average
common shares
(thousands)
Basic 35,829 35,709 35,917 32,928
Diluted 36,188 36,148 36,309 33,262
(1) Acquisition-related items include contingent acquisition consideration
fair value adjustments, contingent acquisition consideration-related
compensation expense, settlements of contingent liabilities of acquired
entities initially recognized at the acquisition date and transaction costs.
(2) Discontinued operations include a commercial real estate consulting
business which was sold in July 2014; the REO rental operation which was sold
in April 2014 and Field Asset Services which was sold in September 2013.
(3) See definition and reconciliation above.
Condensed Consolidated Balance Sheets
(in thousands of US$)
(unaudited) December 31, 2014 December 31, 2013
Assets
Cash and cash equivalents $ 156,793 $ 142,704
Restricted cash 3,657 5,613
Accounts receivable 409,317 371,423
Other current assets 92,429 71,582
Deferred income tax 45,623 23,938
Current assets 707,819 615,260
Other non-current assets 26,332 19,711
Deferred income tax 83,639 102,629
Fixed assets 120,394 101,554
Goodwill and intangible assets 701,243 604,357
Total assets $ 1,639,427 $ 1,443,511
Liabilities and shareholders' equity
Accounts payable and accrued liabilities $ 553,139 $ 485,436
Other current liabilities 40,624 39,943
Long-term debt - current 36,396 44,785
Current liabilities 630,159 570,164
Long-term debt - non-current 456,952 328,009
Other liabilities 51,904 43,051
Deferred income tax 36,205 31,165
Redeemable non-controlling interests 230,992 222,073
Shareholders' equity 233,215 249,049
Total liabilities and equity $ 1,639,427 $ 1,443,511
Supplemental balance sheet information
Total debt $ 493,348 $ 372,794
Total debt, net of cash 336,555 230,090
Condensed Consolidated Statements of
Cash Flows
(in thousands of US$)
Three months ended Twelve months ended
December 31 December 31
(unaudited) 2014 2013 2014 2013
Cash provided by (used in)
Operating activities
Net earnings $ 38,391 $ 25,342 $ 90,936 $ 41,418
Items not affecting cash:
Depreciation and amortization 18,252 14,677 62,516 75,352
Deferred income tax (551) 480 (991) (23,868)
Other 1,312 (1,220) (1,678) 5,823
57,404 39,279 150,783 98,725
Changes in operating assets and 69,902 61,093 8,285 17,552
liabilities
Net cash provided by operating 127,306 100,372 159,068 116,277
activities
Investing activities
Acquisition of businesses, net of cash (48,091) (2,474) (108,245) (37,735)
acquired
Disposal of business, net of cash -- -- 8,373 49,460
disposed
Purchases of fixed assets (16,562) (13,070) (52,506) (34,824)
Other investing activities (3,097) (1,812) (3,799) (4,198)
Net cash used in investing activities (67,750) (17,356) (156,177) (27,297)
Financing activities
(Decrease) increase in long-term debt, 12,420 (94,690) 114,682 35,453
net
Purchases of non-controlling (22,675) (3,808) (35,601) (5,704)
interests, net
Dividends paid to preferred -- -- -- (2,537)
shareholders
Dividends paid to common shareholders (3,586) (3,564) (14,361) (6,890)
Redemption of preferred shares -- -- -- (39,232)
Repurchases of subordinate voting (8,513) -- (28,868) (14,554)
shares
Other financing activities (3,802) (4,083) (16,749) (14,714)
Net cash (used in) provided by (26,156) (106,145) 19,103 (48,178)
financing activities
Effect of exchange rate changes on (6,612) (1,288) (7,905) (6,782)
cash
Increase (decrease) in cash and cash 26,788 (24,417) 14,089 34,020
equivalents
Cash and cash equivalents, beginning 130,005 167,121 142,704 108,684
of period
Cash and cash equivalents, end of $ 156,793 $ 142,704 $ 156,793 $ 142,704
period
Segmented Results
(in thousands of
US$)
Commercial Residential
Real Estate Real Estate Property
(unaudited) Services Services Services Corporate Consolidated
Three months ended
December 31
2014
Revenues $ 541,576 $ 227,870 $ 54,304 $ 76 $ 823,826
Adjusted EBITDA 72,414 6,909 9,037 (7,940) 80,420
Operating earnings 55,005 475 6,972 (9,566) 52,886
2013
Revenues $ 433,311 $ 207,996 $ 50,477 $ 73 $ 691,857
Adjusted EBITDA 61,272 10,496 8,462 (7,353) 72,877
Operating earnings 44,267 7,312 5,332 (8,270) 48,641
Commercial Residential
Real Estate Real Estate Property
Services Services Services Corporate Consolidated
Year ended December
31
2014
Revenues $ 1,582,039 $ 919,545 $ 212,457 $ 232 $ 2,714,273
Adjusted EBITDA 157,406 45,611 37,759 (19,031) 221,745
Operating earnings 97,180 31,379 30,559 (24,691) 134,427
2013
Revenues $ 1,306,334 $ 844,952 $ 193,135 $ 204 $ 2,344,625
Adjusted EBITDA 114,435 53,235 33,521 (17,298) 183,893
Operating earnings 59,209 27,613 23,201 (21,243) 88,780
CONTACT: COMPANY CONTACTS:
Jay S. Hennick
Founder & CEO
D. Scott Patterson
President & COO
John B. Friedrichsen
Senior Vice President & CFO
(416) 960-9500
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: FirstService Corporation via GlobeNewswire
[HUG#1893437]
Unternehmensinformation / Kurzprofil:
Datum: 10.02.2015 - 22:05 Uhr
Sprache: Deutsch
News-ID 370692
Anzahl Zeichen: 31452
contact information:
Town:
TORONTO
Kategorie:
Business News
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