WSP Global Inc.

WSP Global Inc.

March 09, 2009 15:35 ET

GENIVAR Income Fund announces fourth quarter and year-end results

    MONTREAL, March 9  - GENIVAR Income Fund (the "Fund")
announced strong growth in revenues, net revenues and EBITDA for its fourth
quarter of 2008 and for the period from January 1, 2008 to December 31, 2008.Highlights

    - For the full year 2008, revenues grew from $257.2 million, in 2007, to
      $387.8 million, representing a 50.8% increase. Net revenues were
      $320.1 million, up 54.9% from $206.6 million in 2007. EBITDA stood a
      $68.6 million, up 62.7% from $42.2 million in 2007.

    - Revenues in the fourth quarter of 2008 were $115.7 million, up 64.1%
      for the same period in 2007. Net revenues increased by 60.8% to
      $93.3 million compared to $58.0 million in the fourth quarter of 2007.
      EBITDA reached $19.6 million for the period from September 28 to
      December 31, 2008, up 53.3% for the same period in 2007.

    - For the full year 2008, earnings before non-controlling interest were
      $42.5 million, or $1.95 per unit, up from $25.9 million, or $1.32 per
      unit, in 2007. Earnings before non-controlling interest were
      $10.2 million or $0.44 per unit for the fourth quarter compared to
      $9.1 million or $0.44 per unit for the same period in 2007. In the
      fourth quarter of 2008, net earnings were impacted by increased
      depreciation, amortization, interest and income tax expenses of
      $5.7 million.

    - In 2008, the Fund generated adjusted distributable cash of
      $52.9 million, or $2.26 per unit, of which $38.0 million were
      distributed to unitholders, representing annual distributions of $1.70
      per unit and an adjusted payout ratio of 71.8%. This represents an
      increase of $18.9 million of adjusted distributable cash, or $0.67 per
      unit, over the 2007 fiscal year. For the fourth quarter of 2008, the
      Fund generated adjusted distributable cash of $13.8 million, or $0.59
      per unit, up from $11.2 million or $0.53 per unit for the same period
      in 2007."We are extremely pleased with our financial performance in 2008 and the
solid execution of our business plan," said Pierre Shoiry, GENIVAR's President
and CEO. "In 2008, we significantly expanded our geographic reach and
broadened the expertise of our market segments with the addition of 1,000
employees. Our team is strong and our business operates in a wide range of
sectors throughout Canada and abroad which should help us mitigate the impact
of the current economic environment," concluded Pierre Shoiry.

    Conference call

    The Fund will hold a conference call at 2:00 PM (Eastern Time), March 10,
2009, to discuss these results.
    To participate in the conference call:

    - Montreal region, dial 514-861-2909

    - Canada and United States, dial 1-877-695-6175

    Enter access code 5147582
    The replay of the conference call will also be available in the Investor
Relations section of the Company's web site in the following days at
www.genivar.com.

    About GENIVAR

    GENIVAR is a leading Canadian engineering services firm providing private
and public-sector clients with a complete range of professional consulting
services throughout all project phases, including planning, design,
construction and maintenance. Ranging in size and scope, GENIVAR's clients
primarily operate in the building, industrial, power, municipal
infrastructure, transportation and environmental sectors. GENIVAR is one of
Canada's largest consulting engineering services firms by number of employees,
with more than 3,500 managers, professionals, technicians, technologists and
support staff in more than 90 offices in Canada and internationally
(www.genivar.com).RESULTS OF OPERATIONS
    ---------------------
    ---------------------

                            -------------------------------------------------
                                        3 months               12 months
                            -------------------------------------------------
                                    2008        2007        2008        2007
                            -------------------------------------------------
                                 FOR THE     FOR THE     FOR THE     FOR THE
                                  PERIOD      PERIOD      PERIOD      PERIOD
                                    FROM        FROM        FROM        FROM
                            SEPTEMBER 28   OCTOBER 1   JANUARY 1   JANUARY 1
                                      TO          TO          TO          TO
                                DECEMBER    DECEMBER    DECEMBER    DECEMBER
    IN THOUSANDS OF DOLLARS           31          31          31          31
     EXCEPT PER UNIT DATA     (UNAUDITED) (UNAUDITED)   (AUDITED)   (AUDITED)
    -------------------------------------------------------------------------
    Revenues                   $ 115,718    $ 70,528   $ 387,803   $ 257,205

    Deduct: Subconsultants
     and other direct
     expenses                   $ 22,455    $ 12,529    $ 67,709    $ 50,577

    Net revenues                $ 93,263    $ 57,999   $ 320,094   $ 206,628

    Direct project costs        $ 45,353    $ 29,237   $ 157,986   $ 105,979
    -------------------------------------------------------------------------
    Gross margin                $ 47,910    $ 28,762   $ 162,108   $ 100,649

    Marketing, general,
     and administrative
     expenses and others        $ 28,312    $ 15,974    $ 93,499    $ 58,489
    -------------------------------------------------------------------------
    EBITDA                      $ 19,598    $ 12,788    $ 68,609    $ 42,160
    -------------------------------------------------------------------------
    Interest                       $ 850       $ 158     $ 2,341     $ 1,651

    Depreciation of
     property, plant, and
     equipment                   $ 1,647       $ 924     $ 4,705     $ 2,893

    Amortization of
     intangible assets           $ 5,486     $ 3,061    $ 16,527    $ 10,687
    -------------------------------------------------------------------------
    Earnings before income
     taxes and
     non-controlling
     interest                   $ 11,615     $ 8,645    $ 45,036    $ 26,929

    Income taxes                 $ 1,434      ($ 459)    $ 2,518       $ 983
    -------------------------------------------------------------------------
    Earnings before
     non-controlling
     interest                   $ 10,181     $ 9,104    $ 42,518    $ 25,946

    Non-controlling interest     $ 3,955     $ 3,428    $ 16,703    $ 10,651
    -------------------------------------------------------------------------
    Net earnings                 $ 6,226     $ 5,676    $ 25,815    $ 15,295

    Basic net earnings
     per unit                     $ 0.44      $ 0.44      $ 1.95      $ 1.32

    Weighted average number
     of units                 14,192,428  12,858,533  13,213,513  11,543,532

    Diluted net earnings
     per unit                     $ 0.44      $ 0.43      $ 1.95      $ 1.32

    Diluted weighted average
     number of units          23,224,760  21,332,787  21,829,087  19,635,498
    -------------------------------------------------------------------------


    DISTRIBUTABLE CASH
    ------------------
    ------------------

                            -------------------------------------------------
                                        3 months               12 months
                            -------------------------------------------------
                                    2008        2007        2008        2007
                            -------------------------------------------------
                                 FOR THE     FOR THE     FOR THE     FOR THE
                                  PERIOD      PERIOD      PERIOD      PERIOD
                                    FROM        FROM        FROM        FROM
                            SEPTEMBER 28   OCTOBER 1   JANUARY 1   JANUARY 1
                                      TO          TO          TO          TO
                                DECEMBER    DECEMBER    DECEMBER    DECEMBER
    IN THOUSANDS OF DOLLARS           31          31          31          31
     EXCEPT PER UNIT DATA     (UNAUDITED) (UNAUDITED)   (AUDITED)   (AUDITED)
    -------------------------------------------------------------------------
    Cash flows from operating
     activities                 $ 14,069    $ 19,735    $ 38,322    $ 31,801
    Capital expenditures paid   ($ 3,748)   ($ 1,442)  ($ 10,438)   ($ 8,052)

    Standardized
     distributable cash(1)      $ 10,321    $ 18,293    $ 27,884    $ 23,749
    Change in non-cash
     working capital items(2)    $ 3,433    ($ 7,211)   $ 24,988     $ 8,461
    Capital expenditures paid
     for non-recurring
     items(3)                          -       $ 136           -     $ 2,567
    Purchase of units in the
     market under the
     long-term incentive
     plan                              -           -           -      ($ 825)

    Adjusted distributable
     cash(1)(4)                 $ 13,754    $ 11,218    $ 52,872    $ 33,952

    Adjusted distributable
     cash, per unit(1)(4)         $ 0.59      $ 0.53      $ 2.26      $ 1.59

    Payout ratio
      Standardized                 186.7%       64.2%      136.1%      110.1%
      Adjusted                     140.1%      104.7%       71.8%       77.0%
    -------------------------------------------------------------------------
    Distributions

    Fund's units
     distributions              $ 11,793     $ 7,095    $ 23,080    $ 15,500

    Class B Exchangeable LP
     Unit distributions          $ 3,571     $ 2,053     $ 6,836     $ 4,493

    Class C Exchangeable LP
     Unit distributions          $ 3,904     $ 2,601     $ 8,043     $ 6,149

    Aggregate
     distributions,
     all units(4)               $ 19,268    $ 11,749    $ 37,959    $ 26,142

    Aggregate
     distributions, all
     units, per unit(4)           $ 0.83      $ 0.55      $ 1.70      $ 1.30
    -------------------------------------------------------------------------
    (1) Calculation of the distributable cash included a foreign income taxes
        of $0.7 million for the three-month period and of $2.1 million for
        the twelve-month period ended December 31, 2008. Out of this amount,
        $1.3 million will be included on the unitholders' T3 slip as foreign
        income taxes.
    (2) Distributions are based on actual historical and estimated future
        performance of the Fund on a full-year basis. Consequently, periodic
        fluctuations in non-cash working capital are not considered when
        evaluating the cash flows available for distribution.
    (3) Non-recurring capital expenditures pertain to a construction project
        which had for objective to expand square footage of the main office
        in Quebec City.
    (4) Distributable cash and distributable cash per unit amounts are
        calculated for the combined interest of the Fund's units and
        Exchangeable Class B LP units and Exchangeable Class C LP Units,
        which total 23,354,476 as at December 31, 2008 (21,366,405 as at
        December 31, 2007). Number of units has not been adjusted to reflect
        units purchased in the market in connection with the long-term
        incentive plan since the distributions on these units continue to be
        declared and paid.NON-GAAP MEASURES

    The Fund uses non-GAAP measures that are used by Canadian open-ended
income funds as indicators of financial performance measures under GAAP and
may differ from similar computations as reported by other similar entities
and, accordingly, may not be comparable. The Fund believes these measures are
useful supplemental measures that may assist investors in assessing an
investment in units of the Fund.
    Non-GAAP measures used by the Fund are net revenues, EBITDA,
distributable cash, and payout ratio. These measures are defined below.

    Net revenues

    Net revenues are defined as revenues from consulting services less direct
costs for subconsultants and other direct expenses that are recoverable
directly from our clients. Net revenues are not a measure in accordance with
GAAP and do not have standardized meaning prescribed by GAAP. Therefore, net
revenues may not be comparable to similar measures presented by other issuers.
Investors are cautioned that net revenues should not be construed as an
alternative to revenues for the period (as determined in accordance with
GAAP), as an indicator of the Fund's performance.

    EBITDA

    EBITDA is defined as earnings before interest, tax, depreciation, and
amortization. EBITDA is not an earnings measure in accordance with GAAP and
does not have a standardized meaning prescribed by GAAP. Therefore, EBITDA may
not be comparable to similar measures presented by other issuers.

    Distributable cash

    Distributable cash is calculated in accordance with the recommendations
provided in CICA's publication "Standardized Distributable Cash in Income
Trusts and Other Flow-Through Entities." Standardized distributable cash is
defined as cash flows from operating activities as reported in the GAAP
financial statements, including the effects of changes in non-cash working
capital items and any operating cash flows provided from or used in
discontinued operations, less adjustments for:(a) total capital expenditures as reported in the GAAP financial
          statements; and
      (b) restrictions on distributions arising from compliance with
          financial covenants restrictive at the date of the calculation of
          standardized distributable cash and limitations arising from the
          existence of a minority interest in a subsidiary.The Fund also calculated an adjusted distributable cash, which is defined
as standardized distributable cash adjusted for entity-specific adjustment
items that management believes are appropriate for the determination of levels
of distributions.

    Payout ratio

    Standardized payout ratio is defined as aggregate cash distributions
divided by standardized distributable cash. Adjusted payout ratio is defined
as aggregate cash distributions divided by adjusted distributable cash.



Contact Information

  • Pierre Shoiry, President and CEO, GENIVAR
    Income Fund, (514) 340-0046, ext. 5104; Marlène Casciaro, Director of
    Communications, GENIVAR Income Fund, (514) 340-0046, ext. 5184