WSP Reports an Increase in Revenues and EBITDA for the First
Quarter of 2014
MONTREAL, QUEBEC--(Marketwired - May 13, 2014) - 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'Autorité des marchés 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 |
|
(in millions of dollars, except number of shares and per share
data) |
For the period from January 1 to March 29 |
|
For the period from January 1 to March 30 |
|
Revenues |
$ |
511.1 |
|
$ |
478.7 |
|
Less: Subconsultants and direct costs |
$ |
70.5 |
|
$ |
71.9 |
|
Net revenues* |
$ |
440.6 |
|
$ |
406.8 |
|
Personnel costs |
$ |
336.2 |
|
$ |
307.5 |
|
Other
operational costs(1) |
$ |
65.3 |
|
$ |
64.9 |
|
Share of earnings of associates |
$ |
(3.0 |
) |
$ |
(2.7 |
) |
EBITDA* |
$ |
42.1 |
|
$ |
37.1 |
|
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 |
|
Earnings before income taxes |
$ |
22.9 |
|
$ |
19.0 |
|
Income tax expenses |
$ |
5.3 |
|
$ |
4.3 |
|
Share of tax of associates |
$ |
0.7 |
|
$ |
0.6 |
|
Net
earnings |
$ |
16.9 |
|
$ |
14.1 |
|
Attributable to: |
|
|
|
|
|
|
-
Shareholders |
$ |
17.3 |
|
$ |
14.5 |
|
- Non-controlling interests |
$ |
(0.4 |
) |
$ |
(0.4 |
) |
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 |
|
* |
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.
Alexandre L'HeureuxChief Financial OfficerWSP Global
Inc.514-340-0046, ext. 5310alexandre.lheureux@wspgroup.comIsabelle
AdjahiDirector, Communications and Investor RelationsWSP Global
Inc.514-340-0046, ext. 5648isabelle.adjahi@wspgroup.com
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