TORONTO, ONTARIO--(Marketwire - Feb. 29, 2012) - Constellation Software Inc. (TSX:CSU) ("Constellation" or the "Company") today announced its financial results for the fourth quarter and fiscal year ended December 31, 2011. Please note that all dollar amounts referred to in this press release are in U.S. Dollars unless otherwise stated.
The following press release should be read in conjunction with the Company's audited annual Consolidated Financial Statements, prepared in accordance with International Financial Reporting Standards ("IFRS") and our annual Management's Discussion and Analysis for the year ended December 31, 2011, which can be found on SEDAR at www.sedar.com and on the Company's website www.csisoftware.com. Additional information about the Company is also available on SEDAR at www.sedar.com.
2011 Highlights:
- Revenue grew 22% to $773 million compared to $634 million in 2010. Organic revenue growth was 10% in 2011 versus negative 4% in 2010. Excluding the impact of the Public Transit Solutions business ('PTS') acquired in Q4 2009, organic revenue growth was 6% in 2011 compared to 2% in 2010.
- Adjusted EBITDA increased $52 million or 45% to $169 million as compared to 2010
- Adjusted Net Income increased $57 million or 68% to $140 million ($6.63 on a fully diluted per share basis) from $84 million ($3.95 on a fully diluted per share basis) in 2010
- $46 million was deployed on 22 acquisitions which includes $5 million of post-acquisition settlement payments
- Cash flow from operations increased $30 million or 28% to $138 million in 2011 as compared to $107 million in 2010
- Declaration of initial quarterly dividend of $1.00 per share payable on April 2, 2012 to all shareholders of record as of March 12, 2012.
Q4 2011 Highlights:
- Revenue grew 15% to $198 million compared to $172 million in Q4 2010. Organic revenue growth was 7% compared to 1% in Q4 2010
- Adjusted EBITDA grew 45% to $47 million compared to Q4 2010
- Adjusted Net Income grew 78% to $40 million compared to Q4 2010
- Six acquisitions were completed in the quarter for net cash consideration of $10 million, including acquisition settlement payments
- December 31, 2011 cash position (net of borrowings on our line of credit) increased to $33 million, from negative $15 million at December 31, 2010.
Additional Highlights:
- Subsequent to December 31, 2011, the Company completed 3 acquisitions for aggregate cash consideration of $8 million
- The Company's credit facility to be increased from $160 million to $300 million
Fourth quarter 2011 revenue was $198 million, an increase of 15%, or $26 million, compared to $172 million for the comparable period in 2010. For the 2011 fiscal year, total revenue was $773 million, an increase of 22% compared to $634 million for the 2010 fiscal year. The increases for both the fourth quarter and the full year compared to the same periods in the prior year were attributable to both organic growth and growth from acquisitions. Organic growth from our existing business was estimated at approximately 7% for the fourth quarter and 10% for the full year.
Constellation acquired PTS from Continental Automotive AG on November 2, 2009. Given the substantial amount of non-recurring revenue earned by PTS, gross revenue from PTS can fluctuate significantly from year to year. As such, management has chosen to provide supplemental organic growth disclosure to provide greater clarity regarding the impact of PTS on Constellation's consolidated financial results. Excluding PTS, organic growth for Constellation was 6% in Q4 2011 and 6% for fiscal 2011. The following table provides a summary of the impact of PTS on Constellation's organic revenue growth:
| Organic Revenue Growth | |||
| Three months ended December 31, 2011 | Fiscal year ended December 31, 2011 | ||
| Constellation | 7% | 10% | |
| Constellation excluding PTS | 6% | 6% | |
Adjusted EBITDA for the fourth quarter 2011 was $47 million, a 45% increase compared to the prior year's fourth quarter Adjusted EBITDA of $33 million. Fourth quarter Adjusted EBITDA per share on a fully diluted basis increased 45% to $2.24, compared to $1.55 for the same period last year. Adjusted EBITDA for the year ended December 31, 2011 was $169 million, an increase of 45% over last year's Adjusted EBITDA of $116 million for the same period. Adjusted EBITDA per share on a fully diluted basis for the year increased 45% to $7.96, compared to $5.49 for the same period in 2010.
Adjusted Net Income for the fourth quarter 2011 was $40 million, compared to the prior year's fourth quarter Adjusted Net Income of $23 million, a 78% increase. Fourth quarter Adjusted Net Income per share on a fully diluted basis increased 78% to $1.90 compared to $1.06 for the prior year's fourth quarter. Adjusted Net Income for the year ended December 31, 2011 was $140 million, an increase of 68% over last year's Adjusted Net Income of $84 million for the same period. Adjusted Net Income per share on a fully diluted basis for the year increased 68% to $6.63 compared to $3.95 for the same period in 2010.
Net income for the fourth quarter 2011 was $19 million compared to the prior year's fourth quarter net income of $11 million. On a fully diluted per share basis, this translates into net income per share of $0.92 for the fourth quarter of 2011, compared to $0.51 for the same period of 2010. For the year ended December 31, 2011 net income was $157 million or $7.42 per diluted share compared to $30 million or $1.42 per share last year.
The following table displays our revenue by reportable segment and the percentage change for the three and twelve months ended December 31, 2011 compared to the same periods in 2010:
| Three months ended | Period-Over-Period | Fiscal year ended | Period-Over-Period | ||||||||||||
| December 31, | Change | December 31, | Change | ||||||||||||
| 2011 | 2010 | $ | % | 2011 | 2010 | $ | % | ||||||||
| ($000, except percentages) | ($000, except percentages) | ||||||||||||||
| Public Sector | |||||||||||||||
| Licenses | 11,125 | 10,705 | 420 | 4% | 41,717 | 36,080 | 5,637 | 16% | |||||||
| Professional services | 37,081 | 35,637 | 1,444 | 4% | 146,281 | 141,487 | 4,794 | 3% | |||||||
| Hardware and other | 22,822 | 20,063 | 2,759 | 14% | 97,133 | 66,076 | 31,057 | 47% | |||||||
| Maintenance | 73,591 | 61,898 | 11,693 | 19% | 286,520 | 231,189 | 55,331 | 24% | |||||||
| 144,619 | 128,303 | 16,316 | 13% | 571,651 | 474,832 | 96,819 | 20% | ||||||||
| Private Sector | |||||||||||||||
| Licenses | 5,432 | 4,545 | 887 | 20% | 19,359 | 13,907 | 5,452 | 39% | |||||||
| Professional services | 8,956 | 7,309 | 1,647 | 23% | 34,885 | 28,250 | 6,635 | 23% | |||||||
| Hardware and other | 2,736 | 2,452 | 284 | 12% | 11,583 | 8,526 | 3,057 | 36% | |||||||
| Maintenance | 36,614 | 29,377 | 7,237 | 25% | 135,863 | 108,450 | 27,413 | 25% | |||||||
| 53,738 | 43,683 | 10,055 | 23% | 201,690 | 159,133 | 42,557 | 27% | ||||||||
Public Sector
For the quarter ended December 31, 2011, total revenue in the public sector reportable segment increased 13%, or $16 million, to $145 million, compared to $128 million for the quarter ended December 31, 2010. For the year ended December 31, 2011, total revenue increased by 20% or $97 million, to $572 million, compared to $475 million for the comparable period in 2010. The increases for both the three and twelve month periods were significant across our license, hardware and other, and maintenance revenue streams. Revenue growth from acquired businesses was significant for both the three and twelve month periods as we completed twenty acquisitions since the beginning of 2010 in our public sector segment. Revenues increased organically by $9 million or 7% in Q4 2011 and by $44 million or 9% for the year ended December 31, 2011 compared to the same periods in 2010. Excluding PTS, revenues increased organically by 5% in Q4 2011 and 5% in the twelve months ended December 31, 2011.
| Organic Revenue Growth | |||
| Three months ended December 31, 2011 | Fiscal year ended December 31, 2011 | ||
| Public Sector | 7% | 9% | |
| Public Sector excluding PTS | 5% | 5% | |
The organic revenue change was primarily driven by the following:
- Volaris operating group (formerly the Trapeze operating group) (increase of approximately $5 million in Q4 2011 and an increase of approximately $38 million for the year ended December 31, 2011). For both the quarter and year ended December 31, 2011, organic growth was primarily driven by strong revenue from existing clients and new customers in its transit and agricultural verticals.
- Harris operating group (increase of approximately $4 million in Q4 2011 and an increase of approximately $8 million for the year ended December 31, 2011). For both the quarter and year ended December 31, 2011, organic revenue was primarily driven by strong revenue from existing clients and new customers in their utility and local government verticals.
Private Sector
For the quarter ended December 31, 2011, total revenue in the private sector reportable segment increased by 23%, or $10 million, to $54 million, compared to $44 million for the quarter ended December 31, 2010. For the year ended December 31, 2011 total revenue increased by 27% or $43 million, to $202 million, compared to $159 million for the comparable period in 2010. Revenue growth from acquired businesses was significant for both the three and twelve month periods ended December 31, 2011 as we completed twenty-three acquisitions since the beginning of 2010 in our private sector segment. Revenues increased organically by $4 million or 9% in Q4 2011 and $16 million or 10% in the twelve months ended December 31, 2011 compared to the same periods in 2010.
The organic revenue change was primarily driven by the following:
- Jonas operating group (increase of approximately $3 million in Q4 2011 and an increase of approximately $10 million for the year ended December 31, 2011). Jonas' organic growth was driven by strong sales to both existing and new customers in its fitness, leisure centre, construction, and food services verticals.
- Homebuilder operating group (increase of approximately $1 million in Q4 2011 and an increase of approximately $7 million for the year ended December 31, 2011). The organic growth was primarily driven by strong sales to both existing and new customers in its pulp and paper manufacturing and lease management verticals.
During the quarter, Constellation completed six acquisitions for total net cash consideration of approximately $8 million, and made $2 million in acquisition settlement payments. At December 31, 2011, Constellation's cash position (net of borrowings on our line of credit) increased to $33 million, from negative $15 million at December 31, 2010. Subsequent to December 31, 2011, the Company completed 3 acquisitions for aggregate cash consideration of $8 million. We have arranged an increase in our credit facility from $160 million to $300 million and will be adding additional lenders to our banking syndicate. The facility increase is expected to close in March and will be available for general corporate purposes including acquisitions and expires in 2016.
"We are very pleased with our results in 2011. We generated record returns on capital, 10% organic growth, and had strong cash flow from operations." said Mark Leonard, President of Constellation. "Growth in 2011 was driven by strong organic growth in PTS and by a large amount of capital deployed on acquisitions in 2010. Although we are optimistic about our acquisition pipeline, our overall growth will likely slow in 2012 given the relatively small amount of capital deployed on acquisitions in 2011 and a moderation in the PTS organic revenue growth rate."
Conference Call and Webcast
Management will host a conference call at 9:00 a.m. (ET) on Thursday, March 1, 2012 to answer questions regarding the results. The teleconference numbers are 416-340-8061 or 800-396-7098. The call will also be webcast live and archived on Constellation's website at www.csisoftware.com.
A replay of the conference call will be available as of 11:30 a.m. ET the same day until 11:59 p.m. ET on March 25, 2012. To access the replay, please dial 905-694-9451 or 800-408-3053 followed by the passcode 7560408.
Forward Looking Statements
Certain statements herein may be "forward looking" statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Constellation or the industry to be materially different from any future results, performance or achievements expressed or implied by such forward- looking statements. Forward looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward looking statements. These forward looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof and Constellation assumes no obligation, except as required by law, to update any forward looking statements to reflect new events or circumstances.
Non-IFRS Measures
The term "Adjusted EBITDA" refers to net income before deducting finance income, finance costs, income taxes, impairment of non-financial assets, depreciation, amortization, and foreign exchange loss (gain). The Company believes that Adjusted EBITDA is useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration asset depreciation and the other items listed above. "Adjusted EBITDA margin" refers to the percentage that Adjusted EBITDA for any period represents as a portion of total revenue for that period.
"Adjusted net income" means net income plus non-cash expenses (income) such as amortization of intangible assets, deferred income taxes, and certain other non-cash expenses (income). The Company believes that Adjusted net income is useful supplemental information as it provides an indication of the results generated by the Company's main business activities prior to taking into consideration amortization of intangible assets, deferred income taxes, and certain other non-cash expenses (income) incurred by the Company from time to time. "Adjusted net income margin" refers to the percentage that Adjusted net income for any period represents as a portion of total revenue for that period.
Adjusted EBITDA and Adjusted net income are not recognized measures under IFRS and, accordingly, shareholders are cautioned that Adjusted EBITDA and Adjusted net income should not be construed as alternatives to net income determined in accordance with IFRS. The Company's method of calculating Adjusted EBITDA and Adjusted net income may differ from other issuers and, accordingly, Adjusted EBITDA and Adjusted net income may not be comparable to similar measures presented by other issuers. See "Results of Operations -Adjusted EBITDA" and "- Adjusted net income" for a reconciliation of Adjusted EBITDA and Adjusted net income to net income.
The following table reconciles Adjusted EBITDA to net income:
| Three months ended | Fiscal year ended | ||||||||||||
| December 31, | December 31, | ||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||
| ($000, except percentages) | ($000, except percentages) | ||||||||||||
| Total revenue | $ | 198,357 | $ | 171,986 | $ | 773,341 | $ | 633,965 | |||||
| Net income | 19,395 | 10,877 | 157,174 | 30,016 | |||||||||
| Adusted for: | |||||||||||||
| Income tax expense (recovery) | 5,085 | (1,919 | ) | (75,203 | ) | 4,397 | |||||||
| Foreign exchange loss | 364 | 2,483 | 3,392 | 4,526 | |||||||||
| Finance income | (1,100 | ) | (341 | ) | (7,267 | ) | (1,241 | ) | |||||
| Finance costs | 986 | 2,111 | 5,575 | 5,783 | |||||||||
| Bargain purchase gain | 0 | (1,745 | ) | 0 | (1,745 | ) | |||||||
| Impairment of non-financial assets | (29 | ) | - | 489 | - | ||||||||
| Amortization of intangible assets | 20,917 | 19,260 | 76,650 | 67,926 | |||||||||
| Depreciation | 1,829 | 2,028 | 7,868 | 6,756 | |||||||||
| Adjusted EBITDA | 47,447 | 32,754 | 168,678 | 116,418 | |||||||||
| Adjusted EBITDA margin | 24 | % | 19 | % | 22 | % | 18 | % | |||||
The following table reconciles Adjusted net income to net income:
| Three months ended | Fiscal year ended | ||||||||||||
| December 31, | December 31, | ||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||
| ($000, except percentages) | ($000, except percentages) | ||||||||||||
| Total revenue | $ | 198,357 | $ | 171,986 | $ | 773,341 | $ 633,965 | ||||||
| Net income | 19,395 | 10,877 | 157,174 | 30,016 | |||||||||
| Adusted for: | |||||||||||||
| Amortization of intangible assets | 20,917 | 19,260 | 76,650 | 67,926 | |||||||||
| Impairment of non-financial assets | (29 | ) | - | 489 | - | ||||||||
| Bargain purchase gain | 0 | (1,745 | ) | 0 | (1,745 | ) | |||||||
| Deferred income tax recovery | (54 | ) | (5,846 | ) | (93,818 | ) | (12,564 | ) | |||||
| Adjusted net income | 40,229 | 22,546 | 140,495 | 83,633 | |||||||||
| Adjusted net income margin | 20 | % | 13 | % | 18 | % | 13 | % | |||||
The following tables provide supplemental statement of operations and cash flow information for PTS:
| Supplemental financial information | |||||||||||||||||||||||||
| For the three months and fiscal year ended December 31, 2011 | |||||||||||||||||||||||||
| For the three months ended December 31, 2011 | For the fiscal year ended December 31, 2011 | ||||||||||||||||||||||||
| (Unaudited) | Constellation Software Inc. (excluding PTS) |
PTS | Consolidated | Constellation Software Inc.(excluding PTS) |
PTS | Consolidated | |||||||||||||||||||
| Revenue | $ | 164,379 | $ | 33,978 | $ | 198,357 | $ | 629,524 | $ | 143,817 | $ | 773,341 | |||||||||||||
| Adjusted EBITDA | 45,879 | 1,568 | 47,447 | 147,233 | 21,445 | 168,678 | |||||||||||||||||||
| EBITDA as % Total Revenue | 28 | % | 5 | % | 24 | % | 23 | % | 15 | % | 22 | % | |||||||||||||
| Net Income | $ | 18,558 | $ | 837 | $ | 19,395 | $ | 142,478 | $ | 14,696 | $ | 157,174 | |||||||||||||
| Cash flows from operating activities: | |||||||||||||||||||||||||
| Net income | $ | 18,558 | $ | 837 | $ | 19,395 | $ | 142,478 | $ | 14,696 | $ | 157,174 | |||||||||||||
| Adjustments to reconcile net income tonet cash flows from operations, less taxes paid: | 22,119 |
707 |
22,826 |
(10,151 |
) | 6,406 |
(3,745 |
) | |||||||||||||||||
| Change in non-cash operating working capital | (9,396 |
) | 23,937 |
14,541 |
(10,661 |
) | (5,235 |
) | (15,896 |
) | |||||||||||||||
| Cash flows from operating activities | $ | 31,281 | $ | 25,481 | $ | 56,762 | $ | 121,666 | $ | 15,867 | $ | 137,533 | |||||||||||||
The following table reconciles Adjusted EBITDA to net income for PTS:
| For the three months ended December 31, 2011 | For the fiscal year ended December 31, 2011 | |||||||||||||||||||||
| (Unaudited) | Constellation Software Inc.(excluding PTS) |
PTS | Consolidated | Constellation Software Inc.(excluding PTS) |
PTS | Consolidated | ||||||||||||||||
| Total revenue | $ | 164,379 | $ | 33,978 | $ | 198,357 | $ | 629,524 | $ | 143,817 | $ | 773,341 | ||||||||||
| Net income | 18,558 | 837 | 19,395 | 142,478 | 14,696 | 157,174 | ||||||||||||||||
| Adjusted for: | ||||||||||||||||||||||
| Income tax expense | 4,095 | 990 | 5,085 | (79,056 | ) | 3,853 | (75,203 | ) | ||||||||||||||
| Other expenses (income) | 640 | (419 | ) | 221 | 517 | 1,672 | 2,189 | |||||||||||||||
| Amortization of intangible assets | 20,917 | - | 20,917 | 76,650 | - | 76,650 | ||||||||||||||||
| Depreciation | 1,669 | 160 | 1,829 | 6,644 | 1,224 | 7,868 | ||||||||||||||||
| Adjusted EBITDA | 45,879 | 1,568 | 47,447 | 147,233 | 21,445 | 168,678 | ||||||||||||||||
| Adjusted EBITDA margin | 28 | % | 5 | % | 24 | % | 23 | % | 15 | % | 22 | % | ||||||||||
About Constellation Software Inc.
Constellation's common shares are listed on the Toronto Stock Exchange under the symbol "CSU". Constellation Software is an international provider of market leading software and services to a number of industries across both the public and private sectors. The Company acquires, manages and builds vertical market software businesses that provide mission-critical software solutions to address the specific needs of its customers in those industries.
| CONSTELLATION SOFTWARE INC. | |||||||||
| Consolidated Statements of Financial Position | |||||||||
| (In thousands of U.S. dollars) | |||||||||
| December 31, | December 31, | January 1, | |||||||
| 2011 | 2010 | 2010 | |||||||
| Assets | |||||||||
| Current assets: | |||||||||
| Cash | $ | 33,492 | $ | 30,911 | $ | 33,249 | |||
| Equity securities available-for-sale | 21,222 | 23,723 | 22,323 | ||||||
| Accounts receivable | 100,398 | 90,898 | 95,431 | ||||||
| Work in progress | 26,244 | 25,607 | 23,077 | ||||||
| Inventories | 13,539 | 15,945 | 14,320 | ||||||
| Other assets | 25,633 | 26,463 | 26,261 | ||||||
| 220,528 | 213,547 | 214,661 | |||||||
| Non-current assets: | |||||||||
| Property and equipment | 14,591 | 13,469 | 8,226 | ||||||
| Deferred income taxes | 99,659 | 15,368 | 4,779 | ||||||
| Other assets | 28,005 | 23,548 | 13,879 | ||||||
| Intangible assets | 267,792 | 269,987 | 222,239 | ||||||
| 410,047 | 322,372 | 249,123 | |||||||
| Total assets | $ | 630,575 | $ | 535,919 | $ | 463,784 | |||
| Liabilities and Shareholders' Equity | |||||||||
| Current liabilities: | |||||||||
| Bank indebtedness | $ | - | $ | 46,041 | $ | 41,153 | |||
| Accounts payable and accrued liabilities | 114,952 | 104,905 | 86,640 | ||||||
| Deferred revenue | 181,450 | 158,025 | 135,299 | ||||||
| Provisions | 3,555 | 2,253 | 8,312 | ||||||
| Acquired contract liabilities | 4,750 | 10,908 | 7,652 | ||||||
| Acquisition holdback payments | 11,378 | 6,920 | 3,587 | ||||||
| Income taxes payable | 4,751 | 1,424 | 3,757 | ||||||
| 320,836 | 330,476 | 286,400 | |||||||
| Non-current liabilities: | |||||||||
| Deferred income taxes | 11,259 | 17,809 | 16,321 | ||||||
| Acquired contract liabilities | 28,051 | 35,633 | 41,482 | ||||||
| Acquisition holdback payments | 2,474 | 2,744 | 2,537 | ||||||
| Other liabilities | 11,675 | 6,206 | 4,018 | ||||||
| 53,459 | 62,392 | 64,358 | |||||||
| Total liabilities | 374,295 | 392,868 | 350,758 | ||||||
| Shareholders' equity | |||||||||
| Capital stock | 99,283 | 99,283 | 99,283 | ||||||
| Accumulated other comprehensive income | 6,961 | 8,522 | 3,003 | ||||||
| Retained earnings | 150,036 | 35,246 | 10,740 | ||||||
| 256,280 | 143,051 | 113,026 | |||||||
| Total liabilities and shareholders' equity | $ | 630,575 | $ | 535,919 | $ | 463,784 | |||
| CONSTELLATION SOFTWARE INC. | |||||||||
| Consolidated Statements of Comprehensive Income | |||||||||
| (In thousands of U.S. dollars, except per share amounts) | |||||||||
| Years ended December 31, 2011 and 2010 | |||||||||
| 2011 | 2010 | ||||||||
| Revenue | $ | 773,341 | $ | 633,965 | |||||
| Expenses | |||||||||
| Staff | 401,379 | 356,539 | |||||||
| Hardware | 60,854 | 45,109 | |||||||
| Third party license, maintenance and professional services | 51,066 | 37,669 | |||||||
| Occupancy | 18,918 | 16,840 | |||||||
| Travel | 30,038 | 23,094 | |||||||
| Telecommunications | 9,992 | 9,177 | |||||||
| Supplies | 15,314 | 11,125 | |||||||
| Professional fees | 8,623 | 8,219 | |||||||
| Other | 8,479 | 9,775 | |||||||
| Income before the undernoted | 168,678 | 116,418 | |||||||
| Depreciation | 7,868 | 6,756 | |||||||
| Amortization of intangible assets | 76,650 | 67,926 | |||||||
| Impairment of non-financial assets | 489 | - | |||||||
| Foreign exchange loss | 3,392 | 4,526 | |||||||
| Finance income | (7,267 | ) | (1,241 | ) | |||||
| Finance costs | 5,575 | 5,783 | |||||||
| Bargain purchase gain | - | (1,745 | ) | ||||||
| 86,707 | 82,005 | ||||||||
| Profit before income tax | 81,971 | 34,413 | |||||||
| Current income tax expense | 18,615 | 16,961 | |||||||
| Deferred income tax recovery | (93,818 | ) | (12,564 | ) | |||||
| Income tax expense (recovery) | (75,203 | ) | 4,397 | ||||||
| Net income | 157,174 | 30,016 | |||||||
| Net change in fair value | |||||||||
| on available-for-sale financial | |||||||||
| assets during the period | 5,773 | 6,071 | |||||||
| Net unrealized foreign exchange adjustment | |||||||||
| gain (loss) on available-for-sale financial | |||||||||
| assets during the period | (31 | ) | 61 | ||||||
| Reclassification of unrealized gain | |||||||||
| upon derecognition of available-for-sale | |||||||||
| investments | - | (733 | ) | ||||||
| Amounts reclassified to profit during the period | |||||||||
| related to realized gains on | |||||||||
| available-for-sale investments | (6,253 | ) | - | ||||||
| Foreign currency translation differences from foreign operations | (1,188 | ) | 1,607 | ||||||
| Current tax expense | (34 | ) | - | ||||||
| Deferred tax recovery (expense) | 172 | (1,487 | ) | ||||||
| Other comprehensive income for the period, net of income tax | (1,561 | ) | 5,519 | ||||||
| Total comprehensive income for the period | $ | 155,613 | $ | 35,535 | |||||
| Earnings per share | |||||||||
| Basic and diluted | $ | 7.42 | $ | 1.42 | |||||
| CONSTELLATION SOFTWARE INC. | ||||||||||
| Consolidated Statements of Changes in Equity | ||||||||||
| (In thousands of U.S. dollars) | ||||||||||
| Year ended December 31, 2011 | ||||||||||
| Accumulated other comprehensive income/(loss) |
||||||||||
| Capital stock | Cumulative translation account |
Amounts related to gains/losses on available for-sale financial assets |
Total accumulated other comprehensive income/(loss) |
Retained earnings |
Total | |||||
| Balance at January 1, 2011 | $99,283 | $1,379 | $ 7,143 | $8,522 | $35,246 | $143,051 | ||||
| Total comprehensive income for the period | ||||||||||
| Net income | 157,174 | 157,174 | ||||||||
| Other comprehensive income (loss) | ||||||||||
| Net change in fair value | ||||||||||
| on available-for-sale financial | ||||||||||
| assets during the period | 5,773 | 5,773 | - | 5,773 | ||||||
| Net unrealized foreign exchange adjustment | ||||||||||
| gain (loss) on available-for-sale financial | ||||||||||
| assets during the period | (31) | (31) | - | (31) | ||||||
| Amounts reclassified to profit during the period | ||||||||||
| related to realized gains on | ||||||||||
| available-for-sale investments | (6,253) | (6,253) | - | (6,253) | ||||||
| Foreign currency translation differences from foreign operations | (1,188) | (1,188) | - | (1,188) | ||||||
| Current tax expense | (34) | (34) | (34) | |||||||
| Deferred tax recovery | 25 | 147 | 172 | - | 172 | |||||
| Total other comprehensive income (loss) for the period | (1,197) | (364) | (1,561) | - | (1,561) | |||||
| Total comprehensive income for the period | (1,197) | (364) | (1,561) | 157,174 | 155,613 | |||||
| Transactions with owners, recorded directly in equity | ||||||||||
| Dividends to owners of the Company | (42,384) | (42,384) | ||||||||
| Balance at December 31, 2011 | $99,283 | $182 | $ 6,779 | $6,961 | $150,036 | $256,280 | ||||
| CONSTELLATION SOFTWARE INC. | ||||||||||||||||||||||
| Consolidated Statements of Changes in Equity | ||||||||||||||||||||||
| (In thousands of U.S. dollars) | ||||||||||||||||||||||
| Year ended December 31, 2010 | Accumulated other comprehensive income/(loss) |
|||||||||||||||||||||
| Capital stock |
Cumulative translation account |
Amounts related to gains/losses on available for-sale financial assets |
Total accumulated other comprehensive income/(loss) |
Retained earnings |
Total | |||||||||||||||||
| Balance at January 1, 2010 | $ | 99,283 | - | $ | 3,003 | $ | 3,003 | $ | 10,740 | $ | 113,026 | |||||||||||
| Total comprehensive income for the period | ||||||||||||||||||||||
| Net income | 30,016 | 30,016 | ||||||||||||||||||||
| Other comprehensive income (loss) | ||||||||||||||||||||||
| Net change in fair value | ||||||||||||||||||||||
| on available-for-sale financial | ||||||||||||||||||||||
| assets during the period | 6,071 | 6,071 | - | 6,071 | ||||||||||||||||||
| Net unrealized foreign exchange adjustment | ||||||||||||||||||||||
| gain (loss) on available-for-sale financial | ||||||||||||||||||||||
| assets during the period | 61 | 61 | - | 61 | ||||||||||||||||||
| Reclassification of unrealized gain from prior periods | ||||||||||||||||||||||
| upon derecognition of available-for-sale | ||||||||||||||||||||||
| investments | (733 | ) | (733 | ) | - | (733 | ) | |||||||||||||||
| Foreign currency translation differences from foreign operations | 1,607 | - | 1,607 | - | 1,607 | |||||||||||||||||
| Deferred tax expense | (227 | ) | (1,260 | ) | (1,487 | ) | - | (1,487 | ) | |||||||||||||
| Total other comprehensive income (loss) for the period | 1,380 | 4,139 | 5,519 | - | 5,519 | |||||||||||||||||
| Total comprehensive income for the period | 1,380 | 4,139 | 5,519 | 30,016 | 35,535 | |||||||||||||||||
| Transactions with owners, recorded directly in equity | ||||||||||||||||||||||
| Dividends to owners of the Company | (5,510 | ) | (5,510 | ) | ||||||||||||||||||
| Balance at December 31, 2010 | $ | 99,283 | 1,380 | $ | 7,142 | $ | 8,522 | $ | 35,246 | $ | 143,051 | |||||||||||
| CONSTELLATION SOFTWARE INC. | |||||||||
| Condensed Consolidated Statements of Cash Flows | |||||||||
| (In thousands of U.S. dollars) | |||||||||
| 2011 | 2010 | ||||||||
| Cash flows from operating activities: | |||||||||
| Net income | $ | 157,174 | $ | 30,016 | |||||
| Adjustments for: | |||||||||
| Depreciation | 7,868 | 6,756 | |||||||
| Amortization of intangible assets | 76,650 | 67,926 | |||||||
| Impairment of non-financial assets | 489 | - | |||||||
| Finance income | (7,267 | ) | (1,241 | ) | |||||
| Finance costs | 5,575 | 5,783 | |||||||
| Bargain purchase gain | - | (1,745 | ) | ||||||
| Income tax expense (recovery) | (75,203 | ) | 4,397 | ||||||
| Foreign exchange loss | 3,392 | 4,526 | |||||||
| Change in non-cash operating working capital | (15,896 | ) | 10,550 | ||||||
| Income taxes paid | (15,249 | ) | (19,695 | ) | |||||
| Net cash flows from operating activities | 137,533 | 107,273 | |||||||
| Cash flows from financing activities: | |||||||||
| Interest paid | (4,979 | ) | (4,558 | ) | |||||
| Decrease in other non current liabilities | 3,720 | 326 | |||||||
| Decrease in bank indebtedness, net | (47,877 | ) | 4,191 | ||||||
| Dividends paid | (42,755 | ) | (5,510 | ) | |||||
| Net cash flows from financing activities | (91,891 | ) | (5,551 | ) | |||||
| Cash flows from investing activities: | |||||||||
| Acquisition of businesses, net of cash acquired |
(40,511 |
) |
(90,627 |
) |
|||||
| Post-acquisition settlement payments, net of receipts | (5,345 | ) | 7,697 | ||||||
| Purchases of available-for-sale equity securities | (5,944 | ) | (20,035 | ) | |||||
| Proceeds from sale of available-for-sale equity securities | 14,268 | - | |||||||
| Repayment of notes receivable | - | 4,085 | |||||||
| Decrease in restricted cash | 557 | 1,372 | |||||||
| Interest and dividends received | 1,113 | 838 | |||||||
| Property and equipment purchased | (7,350 | ) | (7,092 | ) | |||||
| Cash flows provided for (used in) investing activities | (43,212 | ) | (103,762 | ) | |||||
| Effect of currency translation adjustment on cash and cash equivalents |
|
151 |
|
|
|
(298 |
) |
||
| Decrease in cash and cash equivalents | 2,581 | (2,338 | ) | ||||||
| Cash, beginning of period | 30,911 | 33,249 | |||||||
| Cash, end of period | $ | 33,492 | $ | 30,911 | |||||
Contact Information:
John Billowits
Chief Financial Officer
(416) 861-2279
info@csisoftware.com
www.csisoftware.com