Canada NewsWire
REGINA, Aug. 5, 2015
REGINA, Aug. 5, 2015 /CNW/ - Information Services Corporation (TSX:ISV) ("ISC" or the "Company"), Saskatchewan's exclusive provider of key registry information services, today reported on the Company's financial results for the second quarter ended June 30, 2015.
Second Quarter ended June 30, 2015 Highlights
Financial Position as at June 30, 2015
Subsequent Events
Commenting on the Company's results, Jeff Stusek, President and CEO stated, "Despite the recent economic slowdown, our financial performance overall remains strong when compared to 2007 – 2014 historical averages. We have also demonstrated progress on our growth strategy with the two transactions announced in July 2015."
Stusek also noted that ISC's registry services business remains key to the Company's success and through these two recently announced transactions, ISC has begun the process of expanding its geographic footprint.
Management's Discussion of ISC's Summary of Financial Results For The Three Months Ended June 30, 2015
| | | |
| | | |
(Thousands of CAD dollars, except earnings per share and where noted) | Three Months Ended June 30, 2015 | Three Months Ended June 30, 2014 | |
| | | |
Revenue | | | |
| Land Titles Registry, Land Surveys Directory and Geomatics | $ 15,299 | $ 17,310 |
| Personal Property Registry | $ 2,696 | $ 2,677 |
| Corporate Registry | $ 2,050 | $2,028 |
| Other | $ 8 | $ 1 |
Total revenue | $ 20,053 | $ 22,016 | |
| | | |
EBITDA1 | $ 8,248 | $ 8,556 | |
EBITDA margin1 (% of Revenues) | 41.1% | 38.9% | |
Adjusted EBITDA1 | $ 8,411 | $ 9,353 | |
Adjusted EBITDA margin2 | 41.9% | 42.5% | |
Net income and total comprehensive income | $ 4,973 | $ 5,308 | |
Earnings per share3 | $ 0.28 | $ 0.30 | |
Free cash flow1 | $ 6,643 | $ 8,479 | |
| | | |
Expenses | $ 13,112 | $ 14,696 |
| |
1. | EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin and free cash flow are not recognized as measures under IFRS and do not have a standardized meaning prescribed by IFRS and therefore, are not comparable to similar measures by other corporations. See section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended June 30, 2015.
The Company has updated its calculation of adjusted EBITDA in 2015. Previous adjustments related to the costs of the Company's IPO and normalization adjustments related to the transfer of the Government of Saskatchewan's Vital Statistics Registry are no longer applicable. Instead, EBITDA was adjusted for stock-based compensation expense or income, equity settled employee benefit reserve, transactional gains and losses, asset impairment charges, and acquisition and integration costs. Refer to section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended June 30, 2015 for further information and for reconciliations of EBITDA and adjusted EBITDA, refer to section name "Financial Measures and Key Performance Indicators". |
2. | Adjusted EBITDA margin for 2014, which previously mirrored the EBITDA margin, has been adjusted to conform to the new calculation of adjusted EBITDA margin outlined in the section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended June 30, 2015. |
3. | The calculation of earnings per share is based on net income after tax and the weighted average number of shares outstanding during the period. |
| |
Outlook
The following Outlook section includes forward-looking statements, including statements related to expected increases in prices charged for services, the anticipated revenue outlook, the prevailing and anticipated economic conditions, lower transaction volumes, forecasted existing home sales, average home resale prices in Saskatchewan, changes in motor vehicle sales volume, PPR registration volume and revenue, anticipated steady growth of active business entities, consumer purchasing behaviour, EBITDA margin, impact of cost management efforts, expected level of capital expenditures and the financial impact of recently announced transactions. Refer to section entitled "Caution Regarding Forward-Looking Statements".
The majority of the Company's revenue is linked to transaction volumes which are largely driven by economic conditions in Saskatchewan. In 2015, certain of the key drivers that contribute to the Company's volumes have slowed.
Canada Mortgage and Housing Corporation Housing Market Outlook currently forecasts a decrease of 9.8 per cent in existing home sales volume in Saskatchewan for 2015, with average home resale prices forecast to decrease by 0.7 per cent in 2015.1 Following quarter end, the Bank of Canada reduced the key interest rate for the second time this year. This change could impact consumer purchasing behaviour which is linked to ISC's business. As a result, we continue to anticipate variability in our quarterly Land Registry revenue.
New motor vehicle sales in Saskatchewan, one of the components of our Personal Property Registry, are expected to be lower in 2015 as compared to 2014.2 Overall, we expect the registration volumes and revenues in our personal property registry for 2015 will be slightly lower than 2014.
With respect to the Corporate Registry, steady growth of active business entities contributes to stabilized revenue of the maintenance portion of the Corporate Registry, and we expect this trend to continue throughout the year.
Applicable flat fee adjustments were implemented in July 2015 as per the MSA with the Government of Saskatchewan. Certain ISC fees are adjustable annually based on a formula tied to inflation as measured by the Saskatchewan Consumer Price Index, which is 2.39 per cent in 2015; Corporate Registry fees were increased 3.84 per cent to account for both the 2014 and 2015 adjustments, as fees for this Registry were not increased in 2014. These increases are not expected to offset the reduction in revenue due to lower volumes.
Management continues to expect capital expenditures in 2015 to be in the range of $4.0 million to $6.0 million funded from operating cash flow. These expenditures are primarily expected to be sustaining capital expenditures that include general office improvements, enhancement and upgrades to core technology components and enterprise systems, and continued renewal and enhancement of Corporate Registry technology.
With respect to the recently announced investment in OneMove and acquisition of ESC Corporate Services, the Company expects ESC to impact revenue in the fourth quarter, following the close of the transaction. As an investment, OneMove is not expected to have a significant impact on revenue at this time.
ISC continues to expect its EBITDA margin for fiscal 2015 to be between 34.0 and 36.0 per cent. ISC's key drivers of expenses will continue to be wages, salaries and information technology costs. The Company continues to manage its costs in line with reduced revenues, focussing on wages and salaries and in-year initiative spend, while still maintaining a high level of customer service.
Note to Readers:
This news release provides a general summary of Information Services Corporation's results for the second quarters ended June 30, 2015 and 2014. Readers are encouraged to download the Company's complete financial disclosures. Links to ISC's financial statements and related notes and Management's Discussion and Analysis for the period are available on ISC's website in the Investor section of the site at http://isc.investorroom.com/quarterly-reports. All figures are in Canadian dollars unless otherwise noted.
Copies can also be obtained at www.sedar.com by searching Information Services Corporation's profile or by contacting Information Services Corporation at investor.relations@isc.ca.
Conference Call And Webcast
An investor conference call will be held on Thursday, August 6, 2015 at 11:00 a.m. Eastern Time (9 a.m. Saskatchewan/MDT) to discuss the results. Participants may join the call by dialing toll-free 1-888-390-0546 or 1-416-764-8688 for calls outside North America. Simultaneously, an audio webcast of the conference call will also be available at the following link http://isc.investorroom.com/events. Media are invited to attend on a listen-only basis.
The webcast will be available for replay 24 hours after the event until 11:59 p.m. EST September 6, 2015 at http://isc.investorroom.com/events.
About ISC
ISC is an experienced provider of registry and information services for government, individuals and private sector business. As the exclusive provider of the land titles, surveys, personal property and corporate registries for Saskatchewan, the Company maintains and operates these registries, which are key supporters of economic activity in the province.
Cautionary Note Regarding Forward-Looking Information
This news release contains forward-looking information within the meaning of applicable Canadian securities legislation, including management's expectations and certain assumptions with respect to the registry services and products, its competitive landscape, the Saskatchewan economy, consumer confidence, interest rates, level of unemployment, inflation, real estate market in Saskatchewan, impact of prices for agricultural commodities, oil and potash, claim liabilities, income taxes, our ability to attract and retain skilled staff, the compensation and benefits that will be paid or provided to employees and our level of customer service, as well as goodwill and intangibles are material factors in preparing forward-looking statements. In addition, the words ''may'', ''will'', ''would'', ''should'', ''could'', ''expect'', ''plan'', ''intend'', ''trend'', ''indicate'', ''anticipate'', ''believe'', ''estimate'', ''predict'', ''project'', ''targets'', ''strive'', ''strategy'', ''continue'', ''likely'' or ''potential'' or the negative or other variations of these words or other comparable words or phrases are intended to identify forward-looking statements. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those expressed or implied by such forward-looking information. Although ISC believes the forward-looking information contained in this release is based upon reasonable assumptions, readers are cautioned not to place undue reliance on forward-looking information as it is inherently uncertain and no assurance can be given that the expectations reflected in such information will prove to be correct. Many factors and risks could cause our actual results to differ materially from those expressed or implied by forward-looking information including those detailed in ISC's Annual Information Form, dated March 17, 2015, ISC's Consolidated Financial Statements and Notes and Management's Discussion and Analysis for the period ended June 30, 2015 as well as other documents filed by ISC with Canadian securities regulators through SEDAR at www.sedar.com from time to time. Investors and others should carefully consider the above-noted factors and risks and other uncertainties and potential events. The forward-looking information in this release is made as of the date hereof and, except as required under applicable securities legislation, ISC assumes no obligation to update or revise such information to reflect new events or circumstances.
__________________________________
1 CMHC Housing Market Outlook – Canadian Edition – Second Quarter 2015 and First Quarter 2015.
2 Scotiabank Global Economics – Global Forecast Update – June 26, 2015 and March 31, 2015.
SOURCE Information Services Corporation
Hinweis: ARIVA.DE veröffentlicht in dieser Rubrik Analysen, Kolumnen und Nachrichten aus verschiedenen Quellen. Die ARIVA.DE AG ist nicht verantwortlich für Inhalte, die erkennbar von Dritten in den „News“-Bereich dieser Webseite eingestellt worden sind, und macht sich diese nicht zu Eigen. Diese Inhalte sind insbesondere durch eine entsprechende „von“-Kennzeichnung unterhalb der Artikelüberschrift und/oder durch den Link „Um den vollständigen Artikel zu lesen, klicken Sie bitte hier.“ erkennbar; verantwortlich für diese Inhalte ist allein der genannte Dritte.