People Corporation

People Corporation

April 26, 2012 09:00 ET

People Corporation Announces Strong Second Quarter Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - April 26, 2012) - People Corporation (TSX VENTURE:PEO) -

Financial Highlights

For the second quarter:

Revenue grew by $1,094,772 compared to prior year Q2 results (17.8% growth)
EBITDA increased by $40,767 compared to prior year Q2 results (4.6% increase)
EBITDA per Share (Basic) of $0.028 for the quarter (vs. $0.027 for the comparative year)

For the year to date:

Revenue grew by $2,470,564 compared to prior year results (21.6% growth)
EBITDA grew by $141,210 compared to prior year results (9.0% growth)
EBITDA per Share (Basic) of $0.052 for the year (vs. $0.048 for the comparative year)

Summary Financial Results

February 29, 2012 February 28, 2011
Three months
Six months
Three months
Six months
Revenue $ 7,274,848 $ 13,901,714 $ 6,180,076 $ 11,431,150
EBITDA Before Corporate Costs $ 1,792,054 $ 3,427,328 $ 1,765,419 $ 3,111,142
Operating Income (EBITDA) $ 923,931 $ 1,707,935 $ 883,164 $ 1,566,725
Net Income $ 366,175 $ 522,133 $ 328,438 $ 529,548
EBITDA per share (Basic) $ 0.028 $ 0.052 $ 0.027 $ 0.048

People Corporation, formerly Groupworks Financial Corp. ("People Corporation", the "Company") announces strong financial results for the second quarter and six months ended February 29, 2012 which included growth in revenue to $7.3 million from $6.2 million for the quarter and $13.9 million from $11.4 million for the six month period. This represents revenue growth of 17.8% for the quarter and 21.6% for the year to date. EBITDA increased to $923,931 from $883,164 for the quarter and $1,707,935 from $1,566,725 for the six month period, representing growth of 4.6% and 9.0% respectively.

In addition to strong financial performance, the Company continues to focus on executing its strategic plan, driving organic revenue growth, and attracting top talent. Over the last several quarters we have invested significantly in people, including the addition of benefit consultants and the expansion of our associate broker network. The Company has also added a regional vice-president in Ontario who has overall responsibility for revenue and client service and has expanded the client manager team who has responsibility for client service and client support. Management believes that these investments position the Company to accelerate growth and take advantage of market opportunities.

"I am extremely pleased with the ongoing financial progress we are making," said Laurie Goldberg, CEO of People Corporation. "In addition to strong organic growth, we continue to seek out acquisition and partnering opportunities."

Financial Results

Revenue for the second quarter and six months ended February 29, 2012 was $7.3 million and $13.8 million respectively, up 17.8% and 21.6% from the $6.2 million and $11.4 million in the comparative periods of fiscal 2011. The increase in revenue for the second quarter and year to date ended February 29, 2012 is largely attributable to organic revenue growth which resulted from the investments the Company has made in its Integrated Solutions, Business Development and Group Retirement Solutions divisions. Through the Integrated Solutions division the Company has expanded its distribution through associate brokerage firms. Through the Company's Business Development division the Company has been able to expand its proprietary inside sales system and lead generation capabilities. Through the Group Retirement Solutions division the Company has been able to implement cross-selling initiatives to sell Group Retirement products to existing group benefit clients, as well as expanding its service offering to new clients.

Quarterly EBITDA increased by $40,767 or 4.6%. Quarterly EBITDA was influenced by several projects initiated by the Company during the quarter. The Company continues to invest significantly in revenue generating activities such as the Business Development division and Integrated Solutions division together with product and other service related initiatives. In the short term, these investments will continue to put pressure on EBITDA margins but as these initiatives continue to gain traction we expect additional revenue will start falling to the bottom line.

Revenues for the six month period grew by $2,470,564, while operating costs increased by $2,154,378, thereby causing Operating Income before Corporate Costs to increase over the period to $3,427,328, representing an increase in operating profits of 10.2%.

The Company had Net Income for the second quarter and six months ended February 29, 2012 of $366,175 and $522,133 respectively, compared to Net Income of $328,438 and $529,548 in the same periods in the prior year. This quarterly and year to date increase results in basic earnings per share of $0.011 and $0.016 for the second quarter and six months ended February 29, 2012 compared to $0.010 and $0.016 for the same period in the prior year.

Cash balances were $1,423,441 as at February 29, 2012, an increase of $135,700 since August 31, 2011. The increase in cash was in line with management's expectations and resulted from normal seasonal and cyclical cash impacts along with net repayment of $360,682 in long-term debt over the course of the first six months of fiscal 2012.

The Financial Statements and Management Discussion and Analysis for the period ended February 29, 2012, along with additional information about the Company and all of its public filings are available at

Corporate Developments

The Company continued its positive momentum and strong performance during the second quarter ended February 29, 2012. Corporately, our objectives continued to focus on: (i) shifting expenses from non-revenue generating activities to revenue generating activities with a view of boosting organic growth; (ii) promoting and recruiting leadership to execute our organic growth plans; (iii) building three key revenue generating functions: Business Development, Integrated Solutions and Group Retirement Solutions with a view to enhance growth and to enhance our value proposition for future recruiting, acquisitions and client retention; and (iv) focusing on building a funnel of possible acquisitions.

Results from the implementation of the above strategic initiatives, momentum from past initiatives and the overall improvement in revenue growth can be seen in the Company's continued improvement in financial performance. Our results are demonstrative of excellent operating leverage whereby increased revenue resulted in increased profitability.

Milestones in the current fiscal year include:

  • Addition of Regional Vice President, Ontario. This leadership role will have overall responsibility for sales and client service for the Ontario Region.

  • Expansion of contract staffing practice within the Recruiting Practice area.

  • Through the addition of a Practice Leader the Company launched the expansion of its Manufacturing and Supply Chain recruiting practice.

  • Expanded the benefits consultant team under its HealthSource Plus brand in Toronto.

  • Continued to build upon its client service model by leveraging upon the recently hired Client Managers in Manitoba, Quebec and Ontario and the restructuring of its service departments under the leadership of the Client Managers. The Company now has a compliment of six Client Managers through which the Company is continuing to rollout and enhance its Concierge Service offering.

Results from the implementation of the above strategic initiatives, momentum from past initiatives and the overall improvement in revenue growth can be seen in the Company's financial performance.


In its news release dated March 5, 2012, the Company announced that the Board of Directors granted 600,000 stock options to certain independent directors and management. The Company wishes to clarify that only 575,000 stock options were granted to certain independent directors and management of the Company.

About People Corporation

People Corporation is a leading employee benefits, group retirement and human resource consulting firm in Canada. With a growing national footprint and fourteen offices across seven provinces, the Company is bringing together the leading consultants in the industry, offering innovative and customized human resource, benefit and pension solutions to its clients. Additional corporate information is available at

Forward-Looking Information

This news release contains "forward-looking information" within the meaning of applicable securities laws, such as information concerning anticipated future events, results, circumstances, performance or expectations that are not historical facts. Use of words such as "may", "will", "expect", "believe", or other words of similar effect may indicate forward-looking information including the completion of the transaction, the impact of that transaction on our earnings and cash flow, and the anticipated benefits of the transaction. This information is not a guarantee of future performance and is subject to numerous risks and uncertainties, including those described in our publicly filed documents (which are available on SEDAR at Those risks and uncertainties include: our ability to maintain profitability and manage growth; strong competition from other consultants and changes in the current legislation could result in significant competition from the banking industry; failure of information systems and technology; dependence on key clients; seasonality of revenues and the resulting possible impairment on working capital; reliance on key professionals; additional financing may be required and may not be available under terms favourable to us; there can be no assurance that any suitable future acquisition will be available to us or that, if available, the terms of the acquisition will be favourable to us; and a change in general economic conditions. Many of these risks and uncertainties can affect our actual results and could cause our actual results to differ materially from those expressed or implied in any forward-looking information made by us or on our behalf. Given these risks and uncertainties, investors should not place undue reliance on forward-looking information as a prediction of actual results. All forward-looking information in this news release is qualified by these cautionary statements. This information is made as of the date of this news release and, except as required by applicable law, we undertake no obligation to publicly update or revise any forward-looking information, whether as a result of new information, future events or otherwise. Additionally, we undertake no obligation to comment on analyses, expectations or statements made by third parties in respect of the Company, its financial or operating results or its securities.

Non IFRS Financial Measures

EBITDA, which is defined as earnings (loss) before interest, taxes, dividends, depreciation and amortization, is not a financial measure recognized by International Financial Reporting Standards ("IFRS") and does not have a standardized meaning prescribed by IFRS. Operating Income before Corporate Costs means EBITDA plus expenses incurred at the corporate office. The difference between EBITDA and Operating Income before Corporate Costs is equal to Corporate Costs which include expenses related to acquisitions. Analysis of these differences enables understanding of the operating leverage inherent in the financial results of an acquisitive company. Operating leverage is a term used to describe the quantum of acquired EBITDA that falls to EBITDA of a company following an acquisition and is useful to the understanding of the resulting incremental overheads and synergies. The Company believes that these Non-IFRS financial measures provide meaningful information on the Company's performance and operating results. Readers are cautioned that EBITDA or the Company's calculation of the Operating Income do not have standardized meanings as prescribed by IFRS and may not be comparable to similar measures presented by other companies. Further, readers are cautioned that EBITDA or Operating Income should not replace Net income or loss or cash flows from operating, investing and financing activities (as determined in accordance with IFRS), as an indicator of the Company's performance.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.

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