Information Services Corporation (TSX:ISC) (“ISC”, “we” or the
“Company”) today announced its annual guidance and outlook for
2025.
Consolidated Annual Guidance
2025 (in millions of Canadian dollars)
|
Guidance Ranges 2024 |
Guidance Ranges 2025 |
Revenue |
$240.0 to $250.0 |
$257.0 to $267.0 |
Adjusted EBITDA1 |
$83.0 to $91.0 |
$89.0 to $97.0 |
Outlook
2025 marks the second year of ISC’s growth plan
to again double the size of the Company by 2028, on a similar
metrics basis and based on 2023 results. Our guidance for 2025
reflects continued organic growth in line with historical trends.
While not included in our guidance, our disciplined M&A
strategy is intended to support our 2028 growth targets as we
continue to pursue new opportunities.
As shown in our third-quarter year-to-date
results, 2024 was a strong year as we executed on organic growth.
Initial indications from our unaudited fourth-quarter results
suggest that we can expect to report at the top end of our 2024
guidance because of higher-than-expected high-value registrations
in the Saskatchewan Land Registry for the fourth quarter of
2024.
In Registry Operations, a declining interest
rate environment is likely to support ongoing activity in the
Saskatchewan real estate market. As a result, there is expected to
be typical annual growth in overall volumes in the Saskatchewan
Land Registry of two to three per cent. At the same time, there is
also forecasted to be an increase in the fair market value of
regular real estate transfers, along with inventory challenges in
the lower-value homes category. The stability of the Ontario
Property Tax Assessment division, along with a full year of the
Bank Act Security Registry (“BASR”) and annual Saskatchewan
Registries CPI fee adjustments, will support the segment's steady
financial performance.
In Services, we expect continued growth in the
Regulatory Solutions division due to the ongoing trend of increased
due diligence by financial institutions. In addition, we expect to
build on the strong gains made in the Recovery Solutions division
in 2024. Growth in these two divisions is expected to offset any
headwinds from the further opening of the Ontario Business
Registry, as well as the unexpected banning of the Notice of
Interest Registration (“NOSI”) in Ontario in the second half of
2024.
In Technology Solutions, we are again
forecasting double-digit growth in 2025, supported by a pipeline of
third-party and related-party contracts that are currently being
delivered, including our projects in Cyprus, Guernsey, Michigan,
and the recently announced contract with Liechtenstein, among
others.
As in prior years, the key drivers of expenses
in 2025 are expected to be wages and salaries, cost of goods sold,
as well as the additional operating costs associated with the
enhancement of the Saskatchewan Registries and interest expense,
which are excluded from adjusted EBITDA.
As a result, in 2025, ISC expects revenue to be
within a range of $257.0 million to $267.0
million and adjusted EBITDA to be in a range
of $89.0 million to $97.0 million. In keeping with
our historical performance, the Company also expects to see robust
free cash flow in 2025, which will support the deleveraging of our
balance sheet to realize a long-term net leverage target of 2.0x –
2.5x.
Notes1 Adjusted EBITDA is
not a recognized measure under International Financial Reporting
Standards (“IFRS”) and does not have a standardized meaning
prescribed by IFRS, therefore, it may not be comparable to similar
measures reported by other corporations. Please refer to section 8
for “Non-IFRS Financial Measures” and “Financial Measures and Key
Performance Indicators” in Management’s Discussion and Analysis for
the three and nine months ended September 30, 2024. Additionally,
see the Non-IFRS Performance Measures section noted below.
About ISC®Headquartered in
Canada, ISC is a leading provider of registry and information
management services for public data and records. Throughout our
history, we have delivered value to our clients by providing
solutions to manage, secure and administer information through our
Registry Operations, Services and Technology Solutions segments.
ISC is focused on sustaining its core business while pursuing new
growth opportunities. The Class A Shares of ISC trade on the
Toronto Stock Exchange under the symbol ISC.
Cautionary Note Regarding
Forward-Looking InformationThis news release contains
forward-looking information within the meaning of applicable
Canadian securities laws, including, without limitation, those
contained in the “Outlook” section hereof and statements related to
the industries in which we operate, growth opportunities and our
future financial position and results of operations.
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. Important factors that could cause
actual results to differ materially from the Company's plans or
expectations include risks relating to changes in economic, market
and business conditions, changes in technology and customers’
demands and expectations, reliance on key customers and licences,
dependence on key projects and clients, securing new business and
fixed-price contracts, identification of viable growth
opportunities, implementation of our growth strategy, competition,
termination risks and other risks detailed from time to time in the
filings made by the Company including those detailed in ISC’s
Annual Information Form for the year ended December 31, 2023 and
ISC’s unaudited Condensed Consolidated Interim Financial Statements
and Notes and Management’s Discussion and Analysis for the third
quarter ended September 30, 2024, copies of which are filed on
SEDAR+ at www.sedarplus.ca.
The forward-looking information in this release
is made as of the date hereof and, except as required under
applicable securities laws, ISC assumes no obligation to update or
revise such information to reflect new events or circumstances.
Non-IFRS Performance
MeasuresIncluded within this news release is reference to
certain measures that have not been prepared in accordance with
IFRS, such as adjusted EBITDA. This measure is provided as
additional information to complement those IFRS measures by
providing further understanding of our financial performance from
management’s perspective, to provide investors with supplemental
measures of our operating performance and, thus, highlight trends
in our core business that may not otherwise be apparent when
relying solely on IFRS financial measures. Management
also uses non-IFRS measures to facilitate operating performance
comparisons from period to period, prepare annual operating budgets
and assess our ability to meet future capital expenditure and
working capital requirements.
Accordingly, these non-IFRS measures should not
be considered in isolation or as a substitute for analysis of our
financial information reported under IFRS. Such measures do not
have any standardized meaning prescribed by IFRS and, therefore,
may not be comparable to similar measures presented by other
companies.
Non-IFRS Performance Measure |
Why we use it |
How we calculate it |
Most comparable IFRS financial measure |
Adjusted EBITDA |
- To evaluate performance and
profitability of segments and subsidiaries as well as the
conversion of revenue while excluding non-operational and
share-based volatility.
- We believe that certain investors and
analysts use adjusted EBITDA to measure our ability to service debt
and meet other performance obligations.
- Adjusted EBITDA is also used as a
component of determining short-term incentive compensation for
employees.
|
Adjusted EBITDA:EBITDA add (remove)share-based compensation
expense, acquisition, integration and other costs, gain/loss on
disposal of assets if significant |
Net income |
Investor ContactJonathan Hackshaw
Senior Director, Investor Relations & Capital MarketsToll Free:
1-855-341-8363 in North America or
1-306-798-1137investor.relations@isc.ca
Media ContactJodi BosnjakExternal
Communications SpecialistToll Free: 1-855-341-8363 in North America
or 1-306-798-1137corp.communications@isc.ca
Information Services (TSX:ISC)
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