WSP Global Inc. (TSX: WSP) (“WSP” or the “Corporation”) today
announced financial and operating results for the fourth quarter
and year ended on December 31, 2022.
In 2022, WSP delivered strong results ahead of
Management's expectations, including the highest organic growth in
net revenues in the last decade and a 30 bps increase in adjusted
EBITDA margin. Overall, net revenues, adjusted EBITDA and adjusted
net earnings increased in 2022 by 14%, 16% and 17%,
respectively.
FOURTH QUARTER 2022 FINANCIAL
HIGHLIGHTS
- Revenues and net revenues for the quarter reached $3.56 billion
and $2.55 billion, up 23.2% and 18.9%, respectively, compared to Q4
2021. Net revenue organic growth of 4.8% in the quarter. Net
revenue organic growth of approximately 9.5% when normalized for
the same number of billable days compared to Q4 2021.
- Adjusted EBITDA in the quarter of $446.4 million, compared to
$361.2 million in Q4 2021. Adjusted EBITDA margin for the quarter
increased to 17.5%, compared to 16.8% in Q4 2021.
- Earnings before net financing expense and income taxes in the
quarter of $185.3 million, up $0.1 million compared to Q4
2021.
- Adjusted net earnings for the quarter of $209.3 million, or
$1.68 per share, up $37.6 million and $0.22, respectively, compared
to Q4 2021. The respective increases in these metrics are mainly
attributable to higher adjusted EBITDA.
- Net earnings attributable to shareholders for the quarter of
$120.0 million, or $0.96 per share, compared to $126.7 million
and $1.08 per share in Q4 2021. The decreases are mainly
attributable to higher amortization and depreciation, higher
business acquisition and integration costs and ERP implementation
costs, and higher net financing expenses, partially offset by
higher adjusted EBITDA.
- The Corporation achieved its highest quarterly free cash flow,
reaching $442.7 million.
- Quarterly dividend
declared of $0.375 per share, or $46.7 million, with a 31.1%
Dividend Reinvestment Plan (“DRIP”) participation.
FISCAL YEAR 2022 FINANCIAL
HIGHLIGHTS
- Revenues and net revenues reached $11.93 billion and
$8.96 billion, up 16.1% and 13.8%, respectively, compared to
2021. The increase in net revenue was principally due to
acquisition growth of 8.2% and organic growth of 7.3%. Organic
growth was achieved across all reportable segments and net revenues
exceeded the high end of Management's outlook range for the year of
$8.9 billion.
- Backlog as at December 31, 2022 stood at $13.0 billion,
representing 11.8 months of revenues, up 24.8% in the year. On a
constant currency basis, backlog grew organically by 7.6% in the
year.
- Adjusted EBITDA of $1.53 billion, up 15.7%, compared to $1.32
billion in 2021, reaching the high end of Management's outlook
range for the year.
- Adjusted EBITDA margin increased to 17.1% in 2022, compared to
16.8% in 2021, an increase of 30 basis points, on track with the
Corporation's 2022-2024 strategic financial ambitions.
- Earnings before net financing expense and income taxes in 2022
of $749.1 million, up 3.4% compared to 2021, mainly due to higher
adjusted EBITDA, partially offset by ERP implementation costs which
ramped up in 2022, and higher acquisition and integration costs, as
well as amortization of intangible assets, due to recent
acquisitions.
- Adjusted net earnings in 2022 of $692.6 million, or $5.75 per
share, up $99.7 million or $0.66 per share, compared to 2021. The
respective increases of 16.8% and 13.0% in these metrics are mainly
attributable to higher adjusted EBITDA.
- Net earnings attributable to shareholders of $431.8 million in
2022, or $3.59 per share, down $41.8 million, or $0.48 per
share, compared to 2021. The decrease was mainly due to higher net
financing expenses, amortization and depreciation, business
acquisition and integration costs and ERP implementation costs,
partially offset by higher adjusted EBITDA.
- DSO as at December 31, 2022 stood at 73 days, compared to
66 days as at December 31, 2021, in line with Management's
outlook target range of 70 to 75.
- Net debt to adjusted
EBITDA ratio stood at 1.6x, compared to 0.6x as at
December 31, 2021. The increase is due to issuance of
long-term debt to finance recent acquisitions, while the trailing
twelve-month adjusted EBITDA does not yet include the full results
of recently acquired businesses. Incorporating a full twelve months
of adjusted EBITDA of all acquired businesses, the net debt to
adjusted EBITDA ratio would be 1.5x.
- Full year dividend declared of $1.50 per share, or $181.8
million, with a cash payout of $100.8 million and 44.5% Dividend
Reinvestment Plan (“DRIP”) participation.
“I am proud of our collective achievements in the first year of
our strategic cycle. We deepened our presence and expertise through
strategic acquisitions, reinforced our ESG commitments, and
elevated our people and client experience while delivering
above-expectation financial results, including record organic
growth in net revenues,” said Alexandre L’Heureux, President and
CEO of WSP. “In 2023, we will continue our journey by forging ahead
with an aligned strategy to optimize our business and grow with
purpose as we prepare our cities and environment for the
future.”
OUTLOOK FOR 2023This outlook is
provided as at March 8, 2023, to assist analysts and shareholders
in formalizing their respective views on the year ending December
31, 2023. The reader is cautioned that using this information for
other purposes may be inappropriate. This information constitutes
forward-looking information, based on multiple estimates and
assumptions about future events. Actual results may differ, and
such differences may be material. Expectations are also subject to
a number of risks and uncertainties as well as material assumptions
contained in this press release and in WSP's MD&A for the year
ended December 31, 2022. Please see the section below entitled:
“Forward-Looking Statements”.
The Corporation cautions that the assumptions
used to prepare the 2023 outlook could prove to be incorrect or
inaccurate. Accordingly, WSP’s actual results could differ
materially from the Corporation’s expectations as set out in this
press release.
The target ranges were prepared assuming no
fluctuations in foreign exchange rates in markets in which the
Corporation operates. The Corporation did not consider any
dispositions, mergers, business combinations or other transactions
that may occur after the publication of this press release. In the
2023 target ranges, the Corporation considered numerous economic
and market assumptions regarding the competition, political
environment and economic performance of each region where it
operates.
Management expects the WSP's results for the
year ending December 31, 2023 will fall within the following
ranges:
|
2023 TARGET RANGE(1) |
Net
revenues |
Between $10.0 billion and $10.6 billion |
Adjusted
EBITDA |
Between $1.76 billion and $1.84 billion |
Seasonality and
adjusted EBITDA fluctuations |
-
Q1 2023 : between 21% and 23%
- Q2 2023
: between 23% and 25%
- Q3 2023
: between 26% and 28%
-
Q4 2023 : between 26% and 28%
|
DSO |
Between 70 and 75 days |
Net capital
expenditures |
Between $200 million and $225 million |
Acquisition, integration
and reorganization costs |
Between $55 million and $65 million |
ERP implementation
costs |
Between $70 million and $80 million |
The forecasts were prepared using tax rates
enacted as of December 31, 2022, in the countries in which the
Corporation currently operates. The Corporation anticipates that
the effective tax rate in 2023 will fall between 25% and 29%.
The Corporation anticipates depreciation of
right-of-use assets, property and equipment and amortization of
software to range between $470 million and $495 million.
The Corporation anticipates amortization of
intangible assets related to acquisitions to range between $160
million and $170 million.
The Corporation intends to manage its capital
structure to maintain a net debt to adjusted EBITDA ratio between
1.0 and 2.0.
For 2023, the Corporation anticipates net
revenue organic growth, calculated on a constant currency basis,
ranging between 3% to 6%. Head office corporate costs for 2023 are
expected to range between $110 million and $125 million.
BOARD OF DIRECTORS
APPOINTMENTToday, WSP announces that Mr. Macky Tall will
be joining its Board of Directors, subject to his election at its
2023 shareholders meeting to be held on May 11. Mr. Tall will bring
the Board extensive management, financial and industry experience,
having held several senior leadership positions throughout his
career in the infrastructure and investment sectors.
Mr. Tall is a Partner and Chair of Carlyle's
Global Infrastructure Group, and a member of Carlyle's Leadership
Committee. Prior to joining Carlyle, Mr. Tall held various
leadership positions at Caisse de dépôt et placement du Québec
(CDPQ), one of the world’s largest infrastructure investors and
pension fund, in addition to serving on their Executive Committee
and Investment-Risk Committee, and as founding Chair and CEO of
CDPQ Infra. He was also Chairman of the Board of Directors of
Ivanhoé Cambridge. Throughout his career, Mr. Tall has held a
variety of senior management positions with companies in the energy
and finance sectors. He also sits on the board of directors of the
National Bank of Canada, one of Canada's leading integrated
financial groups, and the United Nations Joint Staff Pension Fund
Investments Committee.
“On behalf of WSP’s Board of Directors, I am
pleased that Macky Tall will, subject to his election, join as a
new member of our Board,” said Christopher Cole, WSP’s Chairman of
the Board. “Mr. Tall’s strong leadership and expertise in finance,
capital markets, infrastructure, and deep knowledge of WSP’s key
sectors of activities, will bring significant value to our Board as
we support WSP’s strategy and growth journey. We look forward to
his contributions to our diverse and collaborative board.”
Mr. Tall holds a bachelor’s degree in Business
Administration (Finance) from HEC Montréal and an MBA (Finance)
from the University of Ottawa. He also completed an undergraduate
degree in Economics at Université de Montréal.
DIVIDENDThe Board of WSP declared a dividend of
$0.375 per share. This dividend will be payable on or about April
15 2023, to shareholders of record at the close of business on
March 31, 2023.
FINANCIAL REPORTThis release includes, by
reference, the 2022 financial reports, including the consolidated
financial statements and the MD&A of the Corporation for the
year ended December 31, 2022, which are available on our website at
www.wsp.com. These documents are also available on SEDAR at
www.sedar.com.
CONFERENCE CALL & WEBCASTWSP will hold a
conference call and webcast from 8:00 a.m. to 9:00 a.m. (Eastern
Time) on March 9, 2023, to discuss these results. To participate in
the conference call, please pre-register using this link.
Registrants will receive a confirmation with dial-in details. A
live webcast of the conference call can be accessed using this
link.
A presentation of the fourth quarter and fiscal 2022 highlights
and results will be accessible on March 8, 2023 after market close
under the “Investors” section of the WSP website. For those unable
to attend, a replay will be available within 24 hours following the
call.
(1) This information constitutes forward-looking information,
based on multiple estimates and assumptions about future events.
The reader is cautioned that using this information for other
purposes may be inappropriate. Actual results may differ and such
differences may be material. Please refer to the "Forward-looking
statements" disclaimer below.
FINANCIAL HIGHLIGHTS
|
Fourth quarters ended |
Years ended |
(in
millions of dollars, except percentages, per share data, DSO and
ratios) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Revenues |
$ |
3,560.8 |
|
$ |
2,891.0 |
|
$ |
11,932.9 |
|
$ |
10,279.1 |
|
Net
revenues(1) |
$ |
2,553.7 |
|
$ |
2,147.4 |
|
$ |
8,957.2 |
|
$ |
7,869.6 |
|
Earnings before net financing
expense and income taxes |
$ |
185.3 |
|
$ |
185.2 |
|
$ |
749.1 |
|
$ |
724.6 |
|
Adjusted EBITDA(2) |
$ |
446.4 |
|
$ |
361.2 |
|
$ |
1,530.2 |
|
$ |
1,322.5 |
|
Adjusted EBITDA margin(2) |
|
17.5 |
% |
|
16.8 |
% |
|
17.1 |
% |
|
16.8 |
% |
Net earnings attributable to
shareholders of WSP Global Inc. |
$ |
120.0 |
|
$ |
126.7 |
|
$ |
431.8 |
|
$ |
473.6 |
|
Basic net earnings per share
attributable to shareholders |
$ |
0.96 |
|
$ |
1.08 |
|
$ |
3.59 |
|
$ |
4.07 |
|
Adjusted net
earnings(2)(3) |
$ |
209.3 |
|
$ |
171.7 |
|
$ |
692.6 |
|
$ |
592.9 |
|
Adjusted net earnings per share(2)(3) |
$ |
1.68 |
|
$ |
1.46 |
|
$ |
5.75 |
|
$ |
5.09 |
|
Cash inflows from operating activities |
$ |
607.4 |
|
$ |
513.2 |
|
$ |
814.8 |
|
$ |
1,060.1 |
|
Free
cash flow(2) |
$ |
442.7 |
|
$ |
369.9 |
|
$ |
309.0 |
|
$ |
646.1 |
|
As at |
|
|
December 31,2022 |
|
December 31,2021 |
|
Backlog(4) |
|
|
$ |
13,006.5 |
|
$ |
10,425.6 |
|
DSO(4) |
|
|
73 days |
|
66 days |
|
As at |
|
|
December 31,2022 |
|
December 31,2021 |
|
Net debt to adjusted EBITDA ratio(4) |
|
|
|
1.6 |
|
|
0.6 |
|
(1) |
Quantitative
reconciliations of net revenues to revenues are presented below
under the caption "Non-IFRS and other financial measures". |
(2) |
Non-IFRS financial measure or non-IFRS ratio without a
standardized definition under IFRS, which may not be comparable to
similar measures or ratios used by other issuers. Quantitative
reconciliations of non-IFRS financial measures to the most directly
comparable IFRS measures are presented below under the caption
"Non-IFRS and other financial measures". Adjusted EBITDA margin is
defined as adjusted EBITDA expressed as a percentage of net
revenues. Adjusted net earnings per share is the ratio of adjusted
net earnings divided by the basic weighted average number of shares
outstanding for the period. This press release incorporates by
reference section 22, “Glossary of segment reporting, non-IFRS and
other financial measures”, of WSP’s MD&A for the year ended
December 31, 2022, filed on SEDAR at www.sedar.com, which
includes explanations of the composition and usefulness of these
non-IFRS financial measures and non-IFRS ratios. |
(3) |
Management has amended its definition of adjusted net earnings,
effective January 1, 2022, to exclude impairment charges on
long-lived assets and reversals thereof. The comparative period
results did not require restatement to apply the current definition
as no impairment of long-lived assets was recorded in 2021. Refer
to section 8.8, “Adjusted net earnings” in WSP’s MD&A for the
year ended December 31, 2022 for further explanation. |
(4) |
This press release incorporates by reference section 22,
“Glossary of segment reporting, non-IFRS and other financial
measures”, of WSP’s MD&A for the quarter and year ended
December 31, 2022, filed on SEDAR at www.sedar.com, which
explains the composition of the supplemental financial measures, as
well as the usefulness of the net debt to adjusted EBITDA ratio,
which is a capital management measure composed of the ratio of net
debt to adjusted EBITDA for the trailing twelve-month period. Net
debt is defined as long-term debt, including current portions but
excluding lease liabilities, and net of cash. |
RESULTS OF OPERATIONS
|
Fourth quarters ended |
Years ended |
(in
millions of dollars, except number of shares and per share
data) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Revenues |
$ |
3,560.8 |
|
$ |
2,891.0 |
|
$ |
11,932.9 |
|
$ |
10,279.1 |
|
Less:
Subconsultants and direct costs |
$ |
1,007.1 |
|
$ |
743.6 |
|
$ |
2,975.7 |
|
$ |
2,409.5 |
|
Net revenues |
$ |
2,553.7 |
|
$ |
2,147.4 |
|
$ |
8,957.2 |
|
$ |
7,869.6 |
|
Earnings before net financing expense and income
taxes |
$ |
185.3 |
|
$ |
185.2 |
|
$ |
749.1 |
|
$ |
724.6 |
|
Net
financing expense |
$ |
27.3 |
|
$ |
14.3 |
|
$ |
161.6 |
|
$ |
79.5 |
|
Earnings before income taxes |
$ |
158.0 |
|
$ |
170.9 |
|
$ |
587.5 |
|
$ |
645.1 |
|
Income
tax expense |
$ |
37.6 |
|
$ |
44.1 |
|
$ |
152.8 |
|
$ |
171.0 |
|
Net earnings |
$ |
120.4 |
|
$ |
126.8 |
|
$ |
434.7 |
|
$ |
474.1 |
|
Net earnings attributable to: |
|
|
|
|
Shareholders of WSP Global Inc. |
$ |
120.0 |
|
$ |
126.7 |
|
$ |
431.8 |
|
$ |
473.6 |
|
Non-controlling interests |
$ |
0.4 |
|
$ |
0.1 |
|
$ |
2.9 |
|
$ |
0.5 |
|
Basic net earnings per share attributable to shareholders |
$ |
0.96 |
|
$ |
1.08 |
|
$ |
3.59 |
|
$ |
4.07 |
|
Diluted
net earnings per share attributable to shareholders |
$ |
0.96 |
|
$ |
1.07 |
|
$ |
3.58 |
|
$ |
4.05 |
|
Basic weighted average number of shares |
|
124,426,229 |
|
|
117,661,970 |
|
|
120,400,365 |
|
|
116,479,695 |
|
Diluted
weighted average number of shares |
|
124,730,705 |
|
|
118,082,536 |
|
|
120,709,390 |
|
|
116,901,686 |
|
CONSOLIDATED STATEMENTS OF FINANCIAL
POSITION(in millions of dollars)References to
notes refer to notes in the financial statements
As at December 31 |
December 31, 2022 |
|
December 31, 2021 |
|
|
$ |
|
$ |
|
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents (note 29) |
495.6 |
|
927.4 |
|
Trade receivables and other receivables (note 15) |
2,625.8 |
|
1,916.8 |
|
Cost and anticipated profits in excess of billings (note 16) |
1,626.2 |
|
1,156.4 |
|
Prepaid expenses |
138.9 |
|
169.6 |
|
Other financial assets (note 17) |
108.2 |
|
141.7 |
|
Income taxes receivable |
39.5 |
|
28.9 |
|
|
5,034.2 |
|
4,340.8 |
|
Non-current assets |
|
|
|
|
Right-of-use assets (note 18) |
978.9 |
|
861.5 |
|
Intangible assets (note 19) |
1,102.6 |
|
549.9 |
|
Property and equipment (note 20) |
398.9 |
|
363.6 |
|
Goodwill (note 21) |
6,792.2 |
|
4,762.3 |
|
Deferred income tax assets (note 13) |
351.3 |
|
165.1 |
|
Other assets (note 22) |
183.6 |
|
207.2 |
|
|
9,807.5 |
|
6,909.6 |
|
Total assets |
14,841.7 |
|
11,250.4 |
|
|
|
|
|
|
Liabilities and equity |
|
|
|
|
Liabilities |
|
|
|
|
Current liabilities |
|
|
|
|
Accounts payable and accrued liabilities (note 23) |
2,736.4 |
|
2,217.3 |
|
Billings in excess of costs and anticipated profits (note 16) |
973.1 |
|
751.1 |
|
Income taxes payable |
260.4 |
|
149.8 |
|
Provisions (note 24) |
152.2 |
|
77.5 |
|
Dividends payable to shareholders (note 28) |
46.7 |
|
44.2 |
|
Current portion of lease liabilities (note 18) |
273.0 |
|
254.2 |
|
Current portion of long-term debt (note 25) |
173.4 |
|
297.4 |
|
|
4,615.2 |
|
3,791.5 |
|
Non-current liabilities |
|
|
|
|
Long-term debt (note 25) |
2,781.1 |
|
1,479.3 |
|
Lease liabilities (note 18) |
856.8 |
|
766.1 |
|
Provisions (note 24) |
288.9 |
|
236.2 |
|
Retirement benefit obligations (note 9) |
162.3 |
|
212.9 |
|
Deferred income tax liabilities (note 13) |
128.3 |
|
99.2 |
|
|
4,217.4 |
|
2,793.7 |
|
Total liabilities |
8,832.6 |
|
6,585.2 |
|
|
|
|
|
|
Equity |
|
|
|
|
Equity attributable to shareholders of WSP Global Inc. |
6,006.0 |
|
4,664.5 |
|
Non-controlling interests |
3.1 |
|
0.7 |
|
Total equity |
6,009.1 |
|
4,665.2 |
|
Total liabilities and equity |
14,841.7 |
|
11,250.4 |
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS(in millions of dollars)References to notes
refer to notes in the financial statements)
|
December 31, 2022 |
|
December 31, 2021 |
|
|
$ |
|
$ |
|
Operating
activities |
|
|
Net earnings |
434.7 |
|
474.1 |
|
Adjustments (note 29) |
535.6 |
|
436.6 |
|
Net financing expense (note
12) |
161.6 |
|
79.5 |
|
Income tax expense (note
13) |
152.8 |
|
171.0 |
|
Income taxes paid |
(185.2 |
) |
(134.0 |
) |
Change
in non-cash working capital items (note 29) |
(284.7 |
) |
32.9 |
|
Cash inflows from operating activities |
814.8 |
|
1,060.1 |
|
Financing activities |
|
|
Issuance of long-term debt
related to business acquisitions (note 13) |
2,309.3 |
|
1,200.7 |
|
Repayment of long-term debt
following business acquisitions (note 13) |
(1,025.8 |
) |
(262.7 |
) |
Net repayment of other
long-term debt |
(235.2 |
) |
(523.9 |
) |
Issuance of common shares, net
of issuance costs (note 26) |
883.5 |
|
308.5 |
|
Lease payments (note 18) |
(341.3 |
) |
(303.2 |
) |
Dividends paid to shareholders
of WSP Global Inc. |
(90.1 |
) |
(80.6 |
) |
Net financing expenses paid,
excluding interest on lease liabilities |
(79.2 |
) |
(47.8 |
) |
Issuance of senior unsecured
notes (note 25) |
— |
|
500.0 |
|
Dividends paid to
non-controlling interests |
(0.5 |
) |
(0.8 |
) |
Cash inflows (outflows) from financing
activities |
1,420.7 |
|
790.2 |
|
Investing activities |
|
|
Net disbursements related to
business acquisitions (note 5) |
(2,556.7 |
) |
(1,244.9 |
) |
Additions to property and
equipment, excluding business acquisitions |
(130.9 |
) |
(100.7 |
) |
Additions to identifiable
intangible assets, excluding business acquisitions |
(35.6 |
) |
(20.5 |
) |
Proceeds from disposal of
property and equipment |
2.0 |
|
10.4 |
|
Dividends received from
associates |
22.0 |
|
14.4 |
|
Net cash received on a loan to
an associate |
1.2 |
|
0.3 |
|
Proceeds from sale of
investment in an associate |
1.2 |
|
4.6 |
|
Net proceeds from disposal of
businesses |
2.6 |
|
— |
|
Decrease (increase) in
investments in securities |
11.5 |
|
(7.1 |
) |
Repurchase of non-controlling interest |
— |
|
(1.4 |
) |
Cash outflows from investing activities |
(2,682.7 |
) |
(1,344.9 |
) |
Effect
of exchange rate change on cash and cash equivalents |
11.9 |
|
(13.8 |
) |
Change in net cash and
cash equivalents |
(435.3 |
) |
491.6 |
|
Cash
and cash equivalents, net of bank overdraft - beginning of the
year |
926.3 |
|
434.7 |
|
Cash and cash
equivalents, net of bank overdraft - end of the year
(note 29) |
491.0 |
|
926.3 |
|
All amounts shown in this press release are expressed in
Canadian dollars, unless otherwise indicated. All quarterly
information disclosed in this press release is based on unaudited
figures.
NON-IFRS AND OTHER FINANCIAL MEASURESThe
Corporation reports its financial results in accordance with IFRS.
WSP uses a number of financial measures when assessing its results
and measuring overall performance. Some of these financial measures
are not calculated in accordance with IFRS. Regulation 52-112
respecting Non-GAAP and Other Financial Measures Disclosure
(“Regulation 52-112”) prescribes disclosure requirements that apply
to the following types of measures used by the Corporation: (i)
non-IFRS financial measures; (ii) non-IFRS ratios; (iii) total of
segments measures; (iv) capital management measures; and (v)
supplemental financial measures.
In this press release, the following non-IFRS and other
financial measures are used by the Corporation: net revenues;
adjusted EBITDA; adjusted EBITDA margin; adjusted net earnings;
adjusted net earnings per share; backlog; free cash flow; days
sales outstanding (“DSO”); and net debt to adjusted EBITDA ratio.
Additional details for these non-IFRS and other financial measures
can be found in section 22, “Glossary of segment reporting,
non-IFRS and other financial measures” of WSP’s MD&A for the
quarter and year ended December 31, 2022, which is posted on
WSP’s website at www.wsp.com, and filed on SEDAR at www.sedar.com.
Reconciliations of non-IFRS financial measures and total of
segments measures to the most directly comparable IFRS measures are
provided below.
Management believes that these non-IFRS and
other financial measures provide useful information to investors
regarding the Corporation’s financial condition and results of
operations as they provide key metrics of its performance. These
non-IFRS and other financial measures are not recognized under
IFRS, do not have any standardized meanings prescribed under IFRS
and may differ from similar computations as reported by other
issuers, and accordingly may not be comparable. These measures
should not be viewed as a substitute for the related financial
information prepared in accordance with IFRS.
Reconciliation of net revenues |
|
|
|
|
|
The following
table reconciles net revenues to the most comparable IFRS
measure: |
|
|
Fourth quarters ended |
|
Years ended |
|
(in
millions of dollars) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Revenues |
$ |
3,560.8 |
|
$ |
2,891.0 |
|
$ |
11,932.9 |
|
$ |
10,279.1 |
|
Less:
Subconsultants and direct costs |
$ |
1,007.1 |
|
$ |
743.6 |
|
$ |
2,975.7 |
|
$ |
2,409.5 |
|
Net revenues* |
$ |
2,553.7 |
|
$ |
2,147.4 |
|
$ |
8,957.2 |
|
$ |
7,869.6 |
|
* Total of segments measure. |
|
Reconciliation of adjusted EBITDA |
|
The following
table reconciles this metric to the most comparable IFRS
measure: |
|
|
Fourth quarters ended |
|
Years ended |
|
(in
millions of dollars) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Earnings before net financing expense and income
taxes |
$ |
185.3 |
|
$ |
185.2 |
|
$ |
749.1 |
|
$ |
724.6 |
|
Acquisition, integration and
reorganization costs |
$ |
49.7 |
|
$ |
23.6 |
|
$ |
115.5 |
|
$ |
60.8 |
|
ERP implementation costs |
$ |
19.4 |
|
$ |
6.8 |
|
$ |
49.9 |
|
$ |
6.8 |
|
Depreciation of right-of-use
assets |
$ |
77.6 |
|
$ |
65.5 |
|
$ |
288.5 |
|
$ |
265.8 |
|
Amortization of intangible
assets |
$ |
73.1 |
|
$ |
46.8 |
|
$ |
173.4 |
|
$ |
139.1 |
|
Depreciation of property
and equipment |
$ |
30.6 |
|
$ |
29.8 |
|
$ |
114.6 |
|
$ |
113.6 |
|
Impairment of long-lived
assets |
$ |
5.1 |
|
$ |
— |
|
$ |
21.6 |
|
$ |
— |
|
Share of depreciation and
taxes of associates |
$ |
3.2 |
|
$ |
2.1 |
|
$ |
11.8 |
|
$ |
9.4 |
|
Interest income |
$ |
2.4 |
|
$ |
1.4 |
|
$ |
5.8 |
|
$ |
2.4 |
|
Adjusted EBITDA* |
$ |
446.4 |
|
$ |
361.2 |
|
$ |
1,530.2 |
|
$ |
1,322.5 |
|
*
Non-IFRS financial measure. |
|
Reconciliation of adjusted net earnings |
The following
table reconciles this metric to the most comparable IFRS
measure: |
|
Fourth quarters ended |
|
Years ended |
|
(in
millions of dollars, except per share data) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Net earnings attributable to shareholders |
$ |
120.0 |
|
$ |
126.7 |
|
$ |
431.8 |
|
$ |
473.6 |
|
Amortization of intangible assets related to acquisitions |
$ |
49.3 |
|
$ |
32.1 |
|
$ |
112.6 |
|
$ |
95.1 |
|
Impairment of long-lived
assets |
$ |
5.1 |
|
$ |
— |
|
$ |
21.6 |
|
$ |
— |
|
Acquisition, integration and
reorganization costs |
$ |
49.7 |
|
$ |
23.6 |
|
$ |
115.5 |
|
$ |
60.8 |
|
ERP implementation costs |
$ |
19.4 |
|
$ |
6.8 |
|
$ |
49.9 |
|
$ |
6.8 |
|
Losses (gains) on investments
in securities related to deferred compensation obligations |
$ |
(5.0 |
) |
$ |
(4.0 |
) |
$ |
22.1 |
|
$ |
(14.0 |
) |
Unrealized losses on
derivative financial instruments |
$ |
(3.5 |
) |
$ |
(1.7 |
) |
$ |
20.1 |
|
$ |
7.7 |
|
Income
taxes related to above items |
$ |
(25.7 |
) |
$ |
(11.8 |
) |
$ |
(81.0 |
) |
$ |
(37.1 |
) |
Adjusted net earnings* |
$ |
209.3 |
|
$ |
171.7 |
|
$ |
692.6 |
|
$ |
592.9 |
|
Adjusted net earnings per share* |
$ |
1.68 |
|
$ |
1.46 |
|
$ |
5.75 |
|
$ |
5.09 |
|
* Non-IFRS
financial measure or non-IFRS ratio. |
Reconciliation of free cash flow |
|
|
|
|
The following
table reconciles this metric to the most comparable IFRS
measure: |
|
Fourth quarters ended |
|
Years ended |
|
(in millions of dollars) |
December 31,2022 |
|
December 31,2021 |
|
December 31,2022 |
|
December 31,2021 |
|
Cash inflows from operating activities |
$ |
607.4 |
|
$ |
513.2 |
|
$ |
814.8 |
|
$ |
1,060.1 |
|
Lease payments in financing
activities |
$ |
(91.9 |
) |
$ |
(82.7 |
) |
$ |
(341.3 |
) |
$ |
(303.2 |
) |
Net
capital expenditures* |
$ |
(72.8 |
) |
$ |
(60.6 |
) |
$ |
(164.5 |
) |
$ |
(110.8 |
) |
Free cash flow** |
$ |
442.7 |
|
$ |
369.9 |
|
$ |
309.0 |
|
$ |
646.1 |
|
* Capital
expenditures pertaining to property and equipment and intangible
assets, net of proceeds from disposal and lease incentives
received. |
** Non-IFRS
financial measure. |
FORWARD-LOOKING STATEMENTS Certain information
regarding WSP contained herein are not based on historical facts
and may constitute forward-looking statements or forward-looking
information under Canadian securities laws (collectively,
“forward-looking statements”). Forward-looking statements may
include estimates, plans, strategic ambitions, objectives,
expectations, opinions, forecasts, projections, guidance, outlook
or other statements that are not statements of fact.
Forward-looking statements made by the Corporation in this press
release include statements about the payment of dividends, our
proposed strategy, and our operating performance, financial
outlook, prospects and expectations including those under the
section “outlook for 2023” of this press release, and statements
about the 2022-2024 Global Strategic Action Plan. These
forward-looking statements are based on a number of assumptions
believed by the Corporation to be reasonable as at March 8, 2023,
including assumptions set out through this press release and under
section 19 “Forward-Looking Statements” of WSP's MD&A for the
quarter and year ended December 31, 2022 which is available on
SEDAR at www.sedar.com.
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 risk factors, which, if realized, could cause the
Corporation's actual results to differ materially from those
expressed or implied in forward-looking statements, are discussed
in greater detail in section 20, “Risk factors” of WSP's MD&A
for the quarter and year ended December 31, 2022 which is available
on SEDAR at www.sedar.com. The forward-looking statements contained
in this press release are made as of the date hereof and,
accordingly, are subject to change after such date. Except to the
extent required by applicable law, WSP does not assume any
obligation to publicly update or revise any forward-looking
statements made in this press release or otherwise, whether as a
result of new information, future events or otherwise.
ABOUT WSP As one of the world’s leading
professional services firms, WSP exists to future-proof our cities
and environment. We provide strategic advisory, engineering, and
design services to clients in the transportation, infrastructure,
environment, building, energy, water, and mining sectors. Our
66,000 trusted professionals are united by the common purpose of
creating positive, long-lasting impacts on the communities we serve
through a culture of innovation, integrity, and inclusion.
Sustainability and science permeate our work. In 2022, WSP derived
more than half of its $11.9 B (CAD) revenues from services that
support the UN Sustainable Development Goals. The Corporation’s
shares are listed on the Toronto Stock Exchange (TSX:WSP).
FOR ADDITIONAL INFORMATION, PLEASE CONTACT:
Alain MichaudChief Financial OfficerWSP Global
Inc.alain.michaud@wsp.com Phone: 438-843-7317
WSP Global (TSX:WSP)
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