TORONTO, ONTARIO--(Marketwire - March 11, 2013) - Altus Group Limited ("Altus") (TSX:AIF) today announced its annual and fourth quarter financial results for the year ended December 31, 2012.
2012 Financial Performance Highlights:
- Delivered healthy year-over-year adjusted EBITDA growth of 30.5%;
- Positive year-over-year revenue increase of 7.1%;
- Adjusted earnings per share of $0.95 for the year, compared to $0.59 in 2011; and,
- Dividends of $0.60 per common share declared for the year.
Full Year Operational Highlights:
- Appointment of Chief Executive Officer, Robert Courteau; an accomplished business leader with valuable experience with a number of well-respected, international technology companies;
- Launched ARGUS Enterprise 9 - a more robust asset management solution in a single, integrated platform, subsequent to which customer reception has been extremely positive;
- Improved balance sheet flexibility through amendments to our bank credit facilities with respect to repayments and bank covenant provisions;
- Settled the US$49.4 million US convertible debenture for a gain of $6.3 million and successfully issued $48.0 million convertible unsecured subordinated debentures;
- Completed the sale of Altus Capital Planning for approximately $7.3 million, and realized a gain on sale of $0.4 million; and,
- Subsequent to year end, consolidated its investment in Real Matters, thereby increasing the equity interest to 25.7% from 19.0% and simplifying the investment for future strategic considerations.
"Altus took targeted actions to strengthen the fundamentals of the business in 2012 and closed the year with strong results and a solid foundation for success," said Robert Courteau, Chief Executive Officer, Altus Group. "We connect this industry like no one else - with leading expertise and best-in-class tools Altus is uniquely positioned to support our global clients. Further integration of our technology assets will enhance client relationships, increase market penetration and expand our scope of business."
Full Year 2012 Financial Performance
For the year ended December 31, 2012, revenue was $322.6 million, compared to $301.2 million in 2011, representing an increase of 7.1%. Revenue gains were the result of higher revenues in Geomatics, RVA, Cost and the UK as well as the acquisition of ARGUS Software in 2011, offset by office closures of Cost operations in Asia and the sale of Altus Capital Planning during the year.
For the year, adjusted EBITDA was $51.1 million, up 30.5% from $39.2 million in 2011. Adjusted earnings per share was $0.95, compared to $0.59 in 2011, a 61.0% increase. The improved performance was due to both higher revenues and improved operating efficiencies in Asia Pacific Cost and corporate activities.
Loss (as reported under IFRS) was $12.7 million, or $0.55 per share, basic and $0.76 per share, diluted, compared to a loss of $18.3 million, or $0.80 per share, basic and diluted, in 2011.
Altus recorded a non-cash impairment charge of $22.5 million, or $0.98 per share, against the carrying value of ARGUS Software, goodwill and intangibles. While management believes this charge is justified at this time, it remains confident about the future prospects of ARGUS both independently and as part of the Altus enterprise.
Fourth Quarter 2012 Financial Performance
Revenue for the fourth quarter of 2012 was $80.7 million, compared to $86.3 million in the same period in 2011, representing a decrease of 6.4%. The decrease was mainly due to revenue related to operations that have been discontinued including office closures in Asia Pacific and the sale of Altus Capital Planning.
Adjusted EBITDA was $11.8 million, compared to $13.2 million in the same period last year, a decrease of 10.6%. The decrease was similarly affected by operations that have been discontinued in the quarter, along with higher variable compensation costs. Adjusted earnings per share was $0.30, compared to $0.25 in the same period in 2011.
Q4 Loss (as reported under IFRS) was $21.5 million, or ($0.94) per share, basic and diluted, compared to a profit of $2.3 million, or $0.10 per share, basic and $0.08 per share, diluted, in the same period in 2011. This was related to the non-cash impairment charge taken on ARGUS Software goodwill and intangible assets.
Subsequent to year end, management undertook restructuring activities within ARGUS Software. In connection with the restructuring, a total of $1.1 million is expected to be recorded in the first quarter of 2013, related primarily to employee severance costs. Into 2013, the ARGUS business will benefit from these changes and under new leadership, is focused on continuous improvement in profitability, enhanced sales effectiveness and improved execution on the product roadmap.
Analyst Call Details
Altus will hold an analyst conference call at 9:30 a.m. Eastern Time on Tuesday, March 12, 2013, to discuss these financial results and current industry conditions. Please dial 1-866-226-1792 (toll-free) or 416-340-2216 (GTA) to access the call. A recording of this call will be made available beginning at 11:00 a.m. ET. To access the recording, please call 1-800-408-3053 or 905-694-9451 (passcode: 1432266). The recording will also be available at www.altusgrouplimited.com.
About Altus Group
Altus leads the global real estate industry in offering professional real estate advisory services, data solutions and intelligence about an organization's assets, generating a wealth of knowledge and insight. With a staff of over 1,700, Altus has a network of over 50 offices in a number of countries worldwide, including Canada, the United Kingdom, the United States, Australia and China. We operate five interrelated Business Units, bringing years of experience and a broad range of expertise together into one comprehensive platform: Research, Valuation and Advisory; Cost Consulting and Project Management; Property Tax; Geomatics, and ARGUS Software. Clients include banks, financial institutions, governments, pension funds, asset and fund managers, developers and landlords and companies engaged in the oil and gas industry.
Certain information in this press release may constitute "forward-looking information" within the meaning of applicable securities legislation. Generally, forward-looking information can be identified by use of words such as "may", "will", "expect", "believe", "plan", "would", "could" and other similar terminology. Inherent in the forward-looking information are known and unknown risks, uncertainties and other factors which could cause actual results, performance or achievements of Altus, or industry results, to differ materially from any results, performance or achievements expressed or implied by such forward-looking information. Those risks, uncertainties and other factors that could cause actual results to differ materially from the forward-looking information include: general state of the economy; competition in the industry; ability to attract and retain professionals; integration of acquisitions; dependence on oil and gas sector; dependence on Canadian multi-residential market; customer concentration; currency risk; interest rate risk; reliance on larger software transactions with longer and less predictable sales cycles; success of new product introductions; ability to respond to technological change and develop products on a timely basis; ability to maintain profitability and manage growth; revenue and cash flow volatility; credit risk; protection of intellectual property or defending against claims of intellectual property rights of others; weather; fixed-price and contingency engagements; operating risks; performance of obligations/maintenance of client satisfaction; appraisal mandates; legislative and regulatory changes; risk of future legal proceedings; insurance limits; income tax matters; ability to meet solvency requirements to pay dividends; leverage and restrictive covenants; unpredictability and volatility of common share price; capital investment; and issuance of additional common shares diluting existing shareholders' interests, as well as those described in Altus' publicly filed documents, including the Annual Information Form (which are available on SEDAR at www.sedar.com).
Given these risks, uncertainties and other factors, investors should not place undue reliance on forward-looking information as a prediction of actual results. The forward-looking information reflects Altus' and management's current expectations and beliefs regarding future events and operating performance and is based on information currently available to management. Although Altus has attempted to identify important factors that could cause actual results to differ materially from the forward-looking information contained herein, there are other factors that could cause results not to be as anticipated, estimated or intended. The forward-looking information contained herein is current as of the date of this press release and, except as required under applicable law, Altus does not undertake to update or revise it to reflect new events or circumstances. Additionally, Altus undertakes no obligation to comment on analyses, expectations or statements made by third parties in respect of Altus, its financial or operating results, or its securities.
Altus uses certain non-IFRS measures as indicators of financial performance. Readers are cautioned that they are not defined performance measures under IFRS and may differ from similar computations as reported by other similar entities and, accordingly, may not be comparable to financial measures as reported by those entities. We believe that these measures are useful supplemental measures that may assist investors in assessing an investment in shares of Altus and provide more insight into our performance.
Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, ("Adjusted EBITDA"), represents operating profit (loss) adjusted for the effect of amortization of intangibles, depreciation of property, plant and equipment, acquisition-related expenses (income), restructuring costs, corporate conversion and legal reorganization costs, share of profit or loss of associate, unrealized foreign exchange gains (losses), gains (losses) on sale of property, plant and equipment, gains (losses) on sale of business assets, impairment charges, the effect of stock options and other equity-settled performance plans, gains (losses) on hedging transactions and other expenses or income of a non-operating and/or non-recurring nature.
Adjusted Earnings (Loss) per Share, ("Adjusted EPS"), represents basic earnings per share adjusted for the effect of amortization of intangibles acquired as part of business acquisitions, non-cash finance costs (income) related to the revaluation of amounts payable to unitholders, distributions related to amounts payable to unitholders, acquisition-related expenses (income), restructuring costs, corporate conversion and legal reorganization costs, share of profit or loss of associate, unrealized foreign exchange gains (losses), gains (losses) on sale of property, plant and equipment, gains (losses) on sale of business assets, interest accretion on vendor payables, gain (loss) on settlement of US convertible debentures, impairment charges, the effect of stock options and other equity-settled performance plans, gains (losses) on hedging transactions and other expenses or income of a non-operating and/or non-recurring nature. All of the adjustments are made net of tax.