WSP Reports an Increase in Revenues and EBITDA for the First Quarter of 2014
13 Mai 2014 - 2:00PM
Marketwired Canada
WSP Global Inc. (TSX:WSP) ("WSP" or the "Corporation") today announced its
financial and operating results for the first quarter of 2014 covering the
period from January 1, 2014 to March 29, 2014.
2014 FIRST QUARTER FINANCIAL HIGHLIGHTS
-- Revenues and net revenues of $511.1 million and $440.6 million, up 6.8%
and 8.3%, respectively, compared to Q1 2013.
-- Record level backlog of $1,723.1 million and approximately 10.1 months
of revenues, up $226.3 million or 15.1% compared to Q4 2013.
-- EBITDA of $42.1 million up $5.0 million or 13.5% compared to the first
quarter of 2013. EBITDA margin at 9.6% of net revenues, compared to 9.1%
for Q1 2013.
-- Net earnings attributable to shareholders excluding amortization of
intangible assets related to acquisitions (net of income taxes) at $21.4
million, or $0.41 per share, up 14.4% or 13.9%, respectively, compared
to Q1 2013.
-- Net earnings attributable to shareholders of $17.3 million, or $0.33 per
share, up 19.3% or 17.9% per share, respectively compared to the first
quarter of 2013.
-- Days sales outstanding ("DSO") stood at 90 days and decreased by 3 days
as compared to a year earlier.
-- Quarterly dividend declared of $0.375 per share, including a 43.6%
Dividend Reinvestment Plan ("DRIP") participation. The Board of
Directors does not anticipate any changes to the current dividend and
DRIP for the remainder of the calendar year.
-- Net debt to trailing twelve month EBITDA ratio at 0.8x.
2014 FIRST QUARTER OPERATIONAL HIGHLIGHTS
-- Effective January 1, 2014, the Corporation reorganized its corporate
structure and completed its rebranding as WSP, setting strong
foundations for future growth and positioning itself as a player with a
global presence.
-- WSP undertook to acquire Focus Group Holdings Inc. ("Focus"), a 1,800
employee engineering and geomatics firm based in Alberta, Canada for an
aggregate amount of $366.1 million. The transaction closed on April 10,
2014.
-- WSP raised net proceeds of approximately $282.1 million via public
bought deal and private placements and obtained an additional $200.0
million in committed credit facilities from its bank syndicate.
-- WSP Canada Inc., a subsidiary of WSP, obtained certification from
l'Autorite des marches financiers ("AMF") to participate in the
procurement of public contracts in the Province of Quebec.
"Our good performance and recently-completed acquisitions put us on the right
path to pursue and achieve our stated 2015 corporate objectives. As we continue
to remain focused on financial performance, we will in parallel, spare no
efforts in building on the other pillars of our strategy," said Pierre Shoiry,
President and Chief Executive Officer of WSP. "As stated in the past, we believe
our performance is reflected not only in our financial results, but also in the
development of our business strategies centered around our employees and
clients, thus creating a high performance organization that creates long term
value for all of our stakeholders. In addition, to attain our objectives, we
continuously strive to align our structure with the needs of our growing
organization, hence us reorganizing our corporate team," he added.
REORGANIZATION OF THE CORPORATE TEAM
As WSP continues to adapt its structure to its strategic plan objectives, WSP
has also reorganized its global team:
-- Paul Dollin, previously Managing Director, UK/Middle East/Africa/India/
Asia Pacific, has been promoted to the position of Chief Operating
Officer. In his new role, reporting to Pierre Shoiry, Mr. Dollin will
hold overall responsibility for WSP's day-to-day operations worldwide.
He will lead the management teams of operating countries and work
closely with the corporate team to ensure that the Corporation realizes
its strategic objectives.
-- WSP's Swedish operations will continue under the strong leadership of
Magnus Meyer, who stepped into the role of Managing Director for Sweden
two months ago, in replacement of Rikard Appelgren, Managing Director,
Europe, who decided to leave the Corporation to pursue other
opportunities. Mr. Appelgren will be continuing as a consultant until
the end of July to assist in the transition and will also be available
to support the Corporation until December 2014.
-- Following the closing of Focus' acquisition, David Ackert was appointed
Chief Executive Officer of WSP Canada Inc. and director of WSP's global
oil and gas network. As such, Mr. Ackert will focus his efforts on
overall strategic and financial growth of the Canadian market.
DIVIDEND
The Board of WSP declared a dividend of $0.375 per share. This dividend will be
payable on or about July 15, 2014, to shareholders of record at the close of
business on June 30, 2014.
FINANCIAL REPORT
This release includes, by reference, the 2014 first quarter financial reports,
including the unaudited interim condensed consolidated financial statements and
the Management's Discussion and Analysis ("MD&A") of the Corporation.
For a copy of our full financial results for the first quarter of 2014,
including the MD&A and the unaudited interim condensed consolidated financial
statements, please visit our website at www.wspgroup.com.
CONFERENCE CALL
WSP will hold a conference call at 4 p.m. (Eastern Time) on May 13, 2014, to
discuss these results. The telephone numbers to access the conference call are
1-647-788-4922 or 1-877-223-4471 (toll-free).
A presentation of the 2014 first quarter highlights and results will be
available on the same day at www.wspgroup.com in the Investors section, under
Presentations & Events.
A replay of the call will be available until May 20, 2014. The telephone numbers
to access the replay of the call are 1-416-621-4642 or 1-800-585-8367
(toll-free), access code 26420615. The replay of the conference call will also
be available in the Investor section of the WSP website in the days following
the call.
ANNUAL MEETING OF SHAREHOLDERS
WSP's annual meeting of shareholders will be held on Thursday, May 22, 2014, at
10:00 a.m. (Eastern time) at the McCord Museum (J. Armand Bombardier Hall)
situated at 690 Sherbrooke Street West, Montreal, Quebec.
ANALYST AND INVESTOR DAY
The Corporation also announced that it will be holding an Analyst and Investor
Day on June 19, 2014 at the Crystal Hotel situated at 1100, de la Montagne
Street, Montreal, Quebec. During this event, that will be webcasted live,
members of WSP's senior corporate and operations management teams will provide
an overview of corporate strategy, operations and financial opportunities in the
near and long term. For additional information on the Analyst and Investor Day,
please visit our website at www.wspgroup.com.
RESULTS OF OPERATIONS
Q1
------------------------------
2014 2013
------------------------------
For the For the
period from period from
(in millions of dollars, except number of January 1 to January 1 to
shares and per share data) March 29 March 30
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Revenues $ 511.1 $ 478.7
Less: Subconsultants and direct costs $ 70.5 $ 71.9
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Net revenues(i) $ 440.6 $ 406.8
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Personnel costs $ 336.2 $ 307.5
Other operational costs(1) $ 65.3 $ 64.9
Share of earnings of associates $ (3.0) $ (2.7)
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EBITDA(i) $ 42.1 $ 37.1
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Amortization of intangible assets $ 8.6 $ 8.5
Depreciation of property, plant and equipment $ 6.4 $ 6.1
Financial expenses $ 3.6 $ 2.6
Share of depreciation of associates $ 0.6 $ 0.9
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Earnings before income taxes $ 22.9 $ 19.0
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Income tax expenses $ 5.3 $ 4.3
Share of tax of associates $ 0.7 $ 0.6
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Net earnings $ 16.9 $ 14.1
Attributable to:
- Shareholders $ 17.3 $ 14.5
- Non-controlling interests $ (0.4) $ (0.4)
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Basic and diluted net earnings per share $ 0.33 $ 0.28
----------------------------------------------------------------------------
Basic and diluted weighted average number of
shares 52,634,219 51,357,337
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(i) Non-IFRS measures as described in the 'Glossary' section.
(1) The Other operational costs included operation exchange loss or gain and
interest income.
NON-IFRS MESURES
The Corporation uses non-IFRS measures that are considered by companies as
indicators of financial performance measures which are not recognized under IFRS
and may differ from similar computations as reported by other similar entities
and, accordingly, may not be comparable. We believe these measures provide
useful supplemental information that may assist investors in assessing an
investment in the Corporation's shares.
Non-IFRS measures used by the Corporation are net revenues; EBITDA; EBITDA
margin; adjusted EBITDA; adjusted EBITDA margin; net earnings (loss) excluding
amortization of intangible assets related to acquisitions (net of income taxes);
net earnings (loss) excluding amortization of intangible assets related to
acquisitions (net of income taxes) per share; backlog; funds from operations;
funds from operations per share; free cash flow; free cash flow per share, DSO
and net debt to EBITDA.
Net revenues
Net revenues are defined as revenues less direct costs for subconsultants and
other direct expenses that are recoverable directly from the clients. Net
revenues are not an IFRS measure and do not have a standardized definition
within IFRS. Therefore, net revenues may not be comparable to similar measures
presented by other issuers. Investors are advised that net revenues should not
be construed as an alternative to revenues for the period (as determined in
accordance with IFRS) as an indicator of the Corporation's performance.
EBITDA
EBITDA is defined as earnings before non-operating expenses identified by
Management, financial expenses, income tax expenses, depreciation and
amortization. EBITDA is not an IFRS measure and does not have a standardized
definition within IFRS. Investors are cautioned that EBITDA should not be
considered an alternative to net earnings for the period (as determined in
accordance with IFRS) as an indicator of the Corporation's performance, or an
alternative to cash flows from operating, financing and investing activities as
a measure of the liquidity and cash flows. The Corporation's method of
calculating EBITDA may differ from the methods used by other issuers and,
accordingly, the Corporation's EBITDA may not be comparable to similar measures
used by other issuers.
EBITDA margin
EBITDA margin is defined as EBITDA expressed as a percentage of net revenues.
EBITDA margin is not an IFRS measure.
Adjusted EBITDA
Adjusted EBITDA is defined as EBITDA excluding global corporate costs. Global
corporate costs are expenses and salaries related to centralized functions, such
as global Finance, Human Resources and Technology teams, which are not allocated
to operating segments. This measure is not an IFRS measure. It provides
Management with comparability from one region to the other.
Adjusted EBITDA margin
Adjusted EBITDA margin is defined as adjusted EBITDA expressed as a percentage
of net revenues. Adjusted EBITDA margin is not an IFRS measure.
Net earnings (loss) excluding amortization of intangible assets related to
acquisitions (net of income taxes) and net earnings (loss) excluding
amortization of intangible assets related to acquisitions (net of income taxes)
per share
Net earnings (loss) excluding amortization of intangible assets related to
acquisitions (net of income taxes) is not an IFRS measure. It provides a
comparative measure of Corporation performance in a context of significant
business combinations. This measure is defined as net earnings (loss)
attributable to shareholders excluding the amortization expense of backlogs,
customer relationships and non-competition agreements accounted for in business
combinations and the income tax effects related to this amortization.
Net earnings (loss) excluding amortization of intangible assets related to
acquisitions (net of income taxes) per share is calculated using the basic
weighted average number of shares.
Backlog
Backlog is not an IFRS measure. It represents future revenues stemming from
existing signed contracts to be completed. The Corporation's method of
calculating backlog may differ from the methods used by other issuers and,
accordingly, may not be comparable to similar measures used by other issuers.
Funds from operations and funds from operations per share
Funds from operations is not an IFRS measure. It provides Management and
investors with a proxy for the amount of cash generated from (used in) operating
activities before changes in non-cash working capital items.
Funds from operations per share is calculated using the basic weighted average
number of shares.
Free cash flow and free cash flow per share
Free cash flow is not an IFRS measure. It provides a consistent and comparable
measurement of free cash flow generated from operations and is used as an
indicator of financial strength and performance. Free cash flow is defined as
cash flows from operating activities as reported in accordance with IFRS, less
maintenance capital expenditures.
Free cash flow per share is calculated using the basic weighted average number
of shares.
Days Sales Outstanding ("DSO")
DSO is not an IFRS measure. It represents the average number of days to convert
our trade receivables and costs and anticipated profits in excess of billings
into cash. The Corporation's method of calculating DSO may differ from the
methods used by other issuers and, accordingly, may not be comparable to similar
measures used by other issuers.
Net Debt to EBITDA
Net Debt to EBITDA is not an IFRS measure. It is a measure of our level of
financial leverage net of our cash and cash equivalents and is calculated on our
trailing twelve month EBITDA.
ABOUT WSP
WSP is one of the world's leading professional services firms, working with
governments, businesses, architects and planners and providing integrated
solutions across many disciplines. The firm provides services to transform the
built environment and restore the natural environment, and its expertise ranges
from environmental remediation to urban planning, from engineering iconic
buildings to designing sustainable transport networks, and from developing the
energy sources of the future to enabling new ways of extracting essential
resources. It has approximately 17,000 employees, mainly engineers, technicians,
scientists, architects, planners, surveyors, other design professionals, as well
as various environmental experts, based in more than 300 offices, across 30
countries, on 5 continents. www.wspgroup.com
Forward-looking statements
Certain information regarding WSP contained herein may constitute
forward-looking statements. Forward-looking statements may include estimates,
plans, expectations, opinions, forecasts, projections, guidance or other
statements that are not statements of fact. Although WSP believes that the
expectations reflected in such forward-looking statements are reasonable, it can
give no assurance that such expectations will prove to have been correct. These
statements are subject to certain risks and uncertainties and may be based on
assumptions that could cause actual results to differ materially from those
anticipated or implied in the forward-looking statements. WSP's forward-looking
statements are expressly qualified in their entirety by this cautionary
statement. The complete version of the cautionary note regarding forward-looking
statements as well as a description of the relevant assumptions and risk factors
likely to affect WSP's actual or projected results are included in the
Management Discussion and Analysis for the fourth quarter and year ended
December 31, 2013, which are available on SEDAR at www.sedar.com. The
forward-looking statements contained in this press release are made as of the
date hereof and WSP does not assume any obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise unless expressly required by applicable securities laws.
FOR FURTHER INFORMATION PLEASE CONTACT:
Alexandre L'Heureux
Chief Financial Officer
WSP Global Inc.
514-340-0046, ext. 5310
alexandre.lheureux@wspgroup.com
Isabelle Adjahi
Director, Communications and Investor Relations
WSP Global Inc.
514-340-0046, ext. 5648
isabelle.adjahi@wspgroup.com
WSP Global (TSX:WSP)
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