Bridgemarq Real Estate Services® Reports First Quarter Results and Declares Monthly Dividend
TORONTO, May 13, 2025 /CNW/ - Bridgemarq Real Estate Services Inc. ("Bridgemarq" or the "Company") (TSX: BRE) today released its first quarter consolidated financial results and announced a monthly dividend to holders of the Company's restricted voting shares.
HIGHLIGHTS
- Revenue in the first quarter amounted to $78.0 million, compared to the $11.9 million generated in the first quarter of 2024, reflecting the operations of the brokerage businesses that were acquired on March 31, 2024. Franchise fees for the first quarter increased marginally due to the benefit of fee increases implemented at the start of the year, partly offset by the fact that the franchise fee revenues received from the acquired brokerages are now eliminated from the consolidated accounts of the Company.
- The Company generated net earnings of $6.0 million or $0.20 per fully diluted share, compared to a net loss of $0.4 million or $0.04 per diluted share in 2024, primarily driven by a gain of $5.7 million on the fair valuation of the Exchangeable Units.
- The Company saw an increase in working capital which contributed to cash used in operating activities of $1.3 million in the first quarter of 2025, compared to cash provided of $2.1 million in 2024.
- Adjusted Net Earnings amounted to $3.1 million in the first quarter or $0.20 per diluted share, compared to $2.4 million or $0.19 last year, primarily due to the operating results of the acquired businesses, lower interest expenses and lower impairment of intangible assets.
- The Company generated $4.1 million in free cash flow in the first quarter of 2025, compared to $4.0 million in 2024.
- The Board of Directors approved a dividend to shareholders of $0.1125 per Restricted Voting Share, payable on June 30, 2025, to shareholders of record on May 30, 2025.
FIRST QUARTER OPERATING RESULTS
Revenues during the first quarter were $78.0 million, compared to the $11.9 million generated in Q1 of 2024. The increase in revenues is due to the inclusion of gross commission income and other revenues of the brokerage businesses acquired in 2024. Franchise fees for the quarter increased marginally due to the impact of a January 1 fee increase, but are lower than the prior year as they exclude franchise fees received from the acquired businesses. The franchise fees received from the acquired businesses were treated as third party revenue prior to April 1, 2024.
During the quarter, the Company generated net earnings of $6.0 million or $0.20 per fully diluted restricted voting share ("Share"), compared to a net loss of $0.4 million or $0.04 per Share in the same quarter in 2024. The higher earnings are largely driven by a gain of $5.7 million on the fair valuation of the Exchangeable Units in the first quarter of 2025, compared to a loss of $2.7 million in the same quarter in 2024.
Cash used in operating activities amounted to $1.3 million in the first quarter of 2025, compared to cash provided by operating activities of $2.1 million in the same quarter last year, as the benefit of improved operating income was offset by an increase in working capital.
Adjusted Net Earnings, which measures earnings of the business before certain non-cash gains and losses on a fully diluted basis, amounted to $3.1 million in the first quarter of 2025, compared to $2.4 million in 2024. The increase in Adjusted Net Earnings is primarily due to the operating results of the acquired businesses.
The Company generated $4.1 million in free cash flow during the first quarter of 2025, a modest improvement from the $4.0 million generated in the same quarter last year.
"We're pleased with our first quarter operating results and the strong momentum we've created at the start of 2025, particularly given the global uncertainty created by recent geopolitical events," said Spencer Enright, Chief Executive Officer, Bridgemarq Real Estate Services Inc. "Our business has expanded in meaningful ways – including broadened businesses and service offerings, which position us very well to continue to expand our reach across the Canadian real estate industry.
"Our ability to attract and support high-performing real estate professionals remains a key driver of the long-term value we offer our shareholders, and I believe we are well equipped to continue to thrive and grow, regardless of market dynamics."
MARKET UPDATE
The Canadian market posted a national decline in transactional dollar volume of 7% in the first quarter of 2025, compared to the same period last year.1 According to the Canadian Real Estate Association, total sales volumes declined 5% and the national average selling price dipped 2% during the quarter, compared to the same period in 2024. On a quarter-over-quarter basis, sales and average selling price posted declines of 18% and 5%, respectively.
Concerns regarding the Canadian economy, driven largely by ongoing trade tensions with the United States, contributed to weakened consumer sentiment in the first quarter of the year. As a result, demand for housing softened in some regions, with Canada's largest and most expensive real estate markets – Toronto and Vancouver – experiencing a slower-than-usual start to the traditionally active spring season.
On April 16, 2025, the Bank of Canada held its target for the overnight lending rate – the first time since June 2024 that the central bank chose not to make a cut – at 2.75%.2 In the face of mounting global economic uncertainty, the Governor cited rising odds of inflation and unpredictable GDP growth as the key factors in the Bank's decision to hold rates at their current level. In March, Canada's Consumer Price Index increased 2.3% year over year, down from the 2.6% recorded in February, mainly due to the lower cost of travel and gasoline.3
Amid the unprecedented trade conflict, it is unclear if the Bank of Canada will resume cuts to interest rates this year, although the election of a new Canadian government is expected to provide some political and economic stability. If consumer confidence improves, a modest increase in market activity could emerge in the latter half of the year.
______________________________ |
1 CREA Canadian Housing Market Statistics |
2 Bank of Canada holds policy rate at 2¾%, April 16, 2025 |
3 Consumer Price Index, March 2025, April 15, 2025 |
CASH DIVIDEND
The Company declared a cash dividend of $0.1125 per Restricted Voting Share payable on June 30, 2025, to shareholders of record on May 30, 2025. The dividend distribution represents a target annual dividend of $1.35 per Restricted Voting Share, which is consistent with 2024.
THE COMPANY NETWORK
As at March 31, 2025, the Franchise Network was comprised of 20,137 REALTORS® operating under 282 franchise agreements from 684 locations. The Company's corporately owned real estate brokerages operate 36 real estate locations in the Greater Toronto Area, Greater Vancouver and within the province of Quebec, with 2,639 sales representatives.
SHAREHOLDERS' MEETING AND CONFERENCE CALL
The Company will be holding its annual meeting of shareholders on May 13, 2025, at 10 a.m. Eastern Daylight Time. The meeting will be conducted as a virtual, live audio webcast.
To access the shareholders' meeting, please visit https://virtual-meetings.tsxtrust.com/1767 and follow the login instructions, using the case-sensitive password 'bresi2025'. Shareholders and proxyholders will require their unique control number, which is provided by TSX Trust Company Canada in accordance with the instructions provided to shareholders. Guests are welcome to join the meeting by following the platform's instructions on the morning of the meeting.
For more information on participation at the virtual, live audio webcast, please review the Company's meeting guide (www.bridgemarq.com/meeting-guide) and the Management Information Circular.
In addition, Bridgemarq Real Estate Services Inc. will host a conference call on Tuesday, May 13, 2025, at 3 p.m. Eastern Daylight Time to discuss its first quarter financial results.
To access the call by telephone, please dial 1-888-699-1199 or 416-945-7677.
To access the call online, please visit https://app.webinar.net/Z1vV04ndyXP.
Please connect approximately ten minutes prior to the beginning of the call to ensure participation.
A transcript of the conference call will be available in the Investor Centre section of the Company's website by Friday, May 16, 2025.
NON-GAAP FINANCIAL MEASURES
This news release makes reference to Free Cash Flow and Free Cash Flow per Share as well as Adjusted Net Earnings and Adjusted Net Earnings per Share, which are non-GAAP financial measures. These financial measures do not have any standardized meaning under International Financial Reporting Standards and, accordingly, may not be comparable to similar measures used by other companies.
Free Cash Flow represents operating income before deducting interest on leases, depreciation and amortization and net impairment and write-off of intangible assets, minus current income tax expense, minus additions to property and equipment and intangible assets, minus repayment of contract transfer obligations, minus lease payments. Free Cash Flow per Share is calculated by dividing Free Cash Flow by the total number of Restricted Voting Shares outstanding, on a diluted basis. The Company believes that Free Cash Flow and Free Cash Flow per Share are useful supplemental measures of performance as they provide investors with an indication of the amount of cash flow generated by the Company which is available to holders of Restricted Voting Shares and Exchangeable Unitholders, subject to working capital and other investment requirements and principal debt repayments, if any. Please see Free Cash Flow reconciled to Cash Flow from Operating Activities for a reconciliation of Free Cash Flow to cash flow from operating activities in the consolidated statements of cash flows and Free Cash Flow for further information about Free Cash Flow and Free Cash Flow per Share.
Adjusted Net Earnings represents operating income minus income tax expense. Adjusted Net Earnings per Share is calculated by dividing Adjusted Net Earnings by the total number of Restricted Voting Shares outstanding, on a diluted basis. Management believes that Adjusted Net Earnings and Adjusted Net Earnings per Share are useful supplemental measures as they provide investors with an indication of the operating results of the Company on a fully-diluted basis (excluding certain non-cash or non-recurring items that do not directly impact the ongoing operations of the Company) as if all Exchangeable Units had been converted into Restricted Voting Shares at the beginning of the period presented. Non-cash and non-recurring items excluded from the calculation of Adjusted Net Earnings are comprised of gains or losses on interest rate swaps, gains on settlement of liabilities and losses on amendment of the Company's debt facilities.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking information and other "forward-looking statements". Words such as "attract", "believe", "believes", "continue", "could", "expected", "expand", "grow", "if", "may not", "position", "subject to", "support", "thrive", "unclear", "will", and other expressions that are predictions of or could indicate future events and trends and that do not relate to historical matters identify forward-looking statements. Reliance should not be placed on forward-looking statements because they involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those indicated in the forward-looking statements include, but are not limited to: changes in the supply or demand of houses for sale in Canada or in any particular region within Canada, changes in the selling price for houses in Canada or any particular region within Canada, changes in the Company's cash f low, changes in the Company's strategy with respect to and/or ability to pay dividends, changes in the productivity of the Company's REALTORS® or the commissions they charge their customers, changes in government policy, laws or regulations which could reasonably affect the housing markets in Canada or the economy in general, changes to any products or services developed or offered by the Company, consumer response to any changes in the housing markets in Canada or any changes in government policy, laws or regulations, changes in general economic conditions (including interest rates, consumer confidence, inflation and other general economic factors or indicators), changes in global and regional economic growth (including international trade relations, the impact of tariffs, political uncertainty), changes in the demand for and prices of natural resources on local and international markets, the level of residential real estate transactions, competition from other real estate brokers or from discount and/or Internet-based real estate alternatives, the closing of existing real estate brokerage offices, other developments in the residential real estate brokerage industry or the Company that reduce the number of REALTORS® in the Company's network or revenue from the Company's network of REALTORS®, our ability to maintain brand equity through the use of trademarks, the methods used by shareholders or analysts to evaluate the value of the Company and its publicly-traded securities, natural disasters, war or acts of terrorism, changes in tax laws or regulations, and other risks detailed in the Company's annual information form, which is filed with securities commissions and posted on SEDAR+ at www.sedarplus.ca. Forward-looking information is based on various material factors or assumptions, which are based on information currently available to management. Material factors or assumptions that were applied in drawing conclusions or making estimates set out in the forward-looking statements include, but are not limited to: anticipated economic conditions, anticipated impact of government policies, anticipated financial performance, anticipated market conditions, business prospects, the successful execution of the Company's business strategies and recent regulatory developments. The factors underlying current expectations are dynamic and subject to change. Although the forward-looking statements contained in this release are based upon what management believes are reasonable assumptions, the Company cannot assure readers that actual results will be consistent with these forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
About Bridgemarq Real Estate Services
Bridgemarq is a leading provider of services to residential real estate brokers and a network of approximately 21,000 REALTORS® through its franchise network and corporately owned brokerages. We operate in Canada under the Royal LePage®, Proprio Direct®, Via Capitale®, Johnston & Daniel® and Les Immeubles Mont-Tremblant brands. For more information, go to www.bridgemarq.com.
BRIDGEMARQ® & DESIGN / BRIDGEMARQ REAL ESTATE SERVICES® and JOHNSTON & DANIEL® are registered trademarks of Residential Income Fund L.P. and are used under licence. ROYAL LEPAGE® is a registered trademark of Royal Bank of Canada and is used under licence. VIA CAPITALE® is a registered trademark of 9120 Real Estate Network L.P. and is used under licence. PROPRIO DIRECT® is a registered trademark of Proprio Direct Inc. and is used under licence. |
The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. |
Bridgemarq Real Estate Services Inc. | ||
Balance Sheet Highlights | ||
(Unaudited) | ||
($ 000's) | March 31, | December 31, |
2025 | 2024 | |
Cash and cash equivalents | $ 7,178 | $ 9,088 |
Cash held in trust | 38,475 | 35,467 |
Other current assets | 12,945 | 9,318 |
Total current assets | 58,598 | 53,873 |
Non-current assets | 101,753 | 103,572 |
Total assets | $ 160,351 | $ 157,445 |
Accounts payable and accrued liabilities | $ 16,191 | $ 16,837 |
Customer deposits | 38,475 | 35,467 |
Interest payable on Exchangeable Units | 909 | 909 |
Dividends payable to shareholders | 1,067 | 1,067 |
Current income taxes payable | 139 | - |
Lease liabilities | 2,928 | 3,000 |
Exchangeable Units | 88,229 | 93,916 |
Total current liabilities | 147,938 | 151,196 |
Debt facilities | 70,916 | 66,904 |
Other non-current liabilities | 18,911 | 19,590 |
Total Liabilities | 237,765 | 237,690 |
Shareholders' deficit | (77,414) | (80,245) |
Total Liabilities and Shareholders' deficit | $ 160,351 | $ 157,445 |
Interim Earnings Highlights | ||
Three months | Three months | |
(Unaudited) | ended | ended |
(in 000's) except per Share amounts | March 31, | March 31, |
2025 | 2024 | |
Gross Commission Income | $ 61,628 | $ - |
Franchise fees | 11,592 | 11,076 |
Other revenues | 4,750 | 780 |
Revenues | 77,970 | 11,856 |
Commissions | (56,840) | - |
Cost of other revenue | (1,296) | (152) |
Operating Expenses | (12,449) | (5,853) |
Interest on debt | (900) | (1,283) |
Interest on lease obligation | (287) | - |
6,198 | 4,568 | |
Impairment and write-off of intangible assets | - | (1,552) |
Amortization of intangible assets | (2,911) | (1,695) |
Interest on Exchangeable Units | (2,726) | (1,452) |
Gain (loss) on fair value of Exchangeable Units | 5,686 | (2,662) |
Gain on settlement of deferred payments | - | 1,224 |
Gain on settlement of contract transfer obligation | - | 99 |
Current income tax expense | (1,066) | (575) |
Deferred income tax expense (recovery) | 851 | 1,667 |
Net and comprehensive earnings (loss) | $ 6,032 | $ (378) |
Basic earnings (loss) per share | $ 0.64 | $ (0.04) |
Diluted earnings (loss) per share | $ 0.20 | $ (0.04) |
Cash Flow Highlights | ||
(Unaudited) | ||
($ 000's) | ||
Cash provided by (used in) operating activities: | $ (1,270) | $ 2,074 |
Cash provided by (used in) investing activities: | (380) | 4,054 |
Cash used for financing activities: | (260) | (3,277) |
Net change in cash and cash equivalents during the period | (1,910) | 2,851 |
Cash and cash equivalents, beginning of the period | 9,088 | 5,743 |
Cash and cash equivalents, end of the period | $ 7,178 | $ 8,594 |
Free Cash Flow Highlights | ||
(Unaudited) | ||
(in 000's) except per Share amounts | ||
Free Cash Flow | $ 4,096 | $ 4,032 |
Free Cash Flow per Share | $ 0.26 | $ 0.31 |
Free Cash Flow Reconciled to Cash Flow from Operating Activities | ||
Three months | Three months | |
(Unaudited) | ended | ended |
($ 000's) | March 31, | March 31, |
2025 | 2024 | |
Cash flow from (used in) operating activities | $ (1,270) | $ 2,074 |
Add (deduct): | ||
Interest on Exchangeable Units | 2,726 | 1,452 |
Interest on Lease Obligation | 287 | - |
Current Income tax expense | (1,066) | (575) |
Income taxes paid | 711 | 750 |
Changes in non-cash working capital | 4,441 | 865 |
Interest expense | (3,913) | (2,824) |
Interest paid | 3,619 | 2,382 |
Interest income | 272 | 98 |
Interest received | (272) | (98) |
Lease payments | (1,059) | - |
Additions to property and equipment and intangible assets | (380) | (88) |
Repayment of contract transfer obligation and other | - | (4) |
Free Cash Flow | $ 4,096 | $ 4,032 |
Adjusted Net Earnings Highlights | ||
(Unaudited) | ||
(in 000's) except per Share amounts | ||
Adjusted net earnings | $ 3,072 | $ 2,413 |
Adjusted net earnings per share | $ 0.20 | $ 0.19 |
Three months | Three months | |
(Unaudited) | ended | ended |
($ 000's) | March 31, | March 31, |
2025 | 2024 | |
Gross Commission Income | $ 61,628 | $ - |
Franchise fees | 11,592 | 11,076 |
Other revenue | 4,750 | 780 |
Revenues | 77,970 | 11,856 |
Commissions | (56,840) | - |
Cost of other revenue | (1,296) | (152) |
Operating Expenses | (12,449) | (5,853) |
Interest on debt | (900) | (1,283) |
Interest on lease obligation | (287) | - |
Impairment and write-off of intangible assets | - | (1,552) |
Amortization of intangible assets | (2,911) | (1,695) |
Operating Income | 3,287 | 1,321 |
Current income tax expense | (1,066) | (575) |
Deferred income tax recovery | 851 | 1,667 |
Adjusted net earnings | $ 3,072 | $ 2,413 |
Three months | Three months | |
(Unaudited) | ended | ended |
($ 000's) | March 31, | March 31, |
2025 | 2024 | |
Net and comprehensive earnings (loss) | $ 6,032 | $ (378) |
Add (deduct): | ||
Interest on Exchangeable Units | 2,726 | 1,452 |
Gain (loss) on fair value of Exchangeable Units | (5,686) | 2,662 |
Gain on settlement of deferred payments | - | (1,224) |
Gain on settlement of contract transfer obligation | - | (99) |
Adjusted net earnings (loss) | $ 3,072 | $ 2,413 |
SOURCE Bridgemarq Real Estate Services Inc.
For more information, please contact: Anne-Elise Cugliari Allegritti, Director of Investor Relations, Bridgemarq Real Estate Services, info@bridgemarq.com, Tel: 416.510.5783; Glen McMillan, Chief Financial Officer, Bridgemarq Real Estate Services, glen.mcmillan@bridgemarq.com, Tel: 416.417.3870
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