IBI announces strong third quarter results tempered by US currency decline:
- Revenue at $68.8 million; increase of $1.5 million + 2.3%; - EBITDA at $11.8 million; decrease of $ 1.1 million - 8.2%; - Distributable Cash of $8.6 million; decrease of $1.8 million - 17.1% - Distributable Cash per unit of $0.4872 vs declared of $0.3999 - payout ratio of 82.1%.
Revenue for the three months ended
Revenue from strategic growth through acquisitions accounted for approximately
EBITDA for the three months ended
All of the preceding includes the impact of foreign exchange. EBITDA for the three months ended
Net earnings before non-controlling interest of the Fund for the three months ended
All of the preceding includes the impact of foreign exchange. Excluding the impact of foreign exchange, net earnings before non-controlling interest for the three months ended
Distributable Cash - For the three months ended
All of the preceding includes the impact of foreign exchange. Excluding the impact of foreign exchange, Distributable Cash for the three months ended
Backlog:
The current backlog of contracted committed fee volume for the next 12 months has increased to an amount approaching nine months equivalent of work, from the amount exceeding eight months since the IBI Group Report on the second quarter ending
Operating Highlights and Major Achievements:
The third quarter results have continued with the strong improvement in operating results of IBI Group, as compared to the first quarter of 2009. As noted in the MD&A of the first quarter, the situation changed materially for IBI Group in the latter part of February. This stronger pace was reflected in the improved second quarter results and maintained in the third quarter results.
Public sector work continued to increase, offsetting the continuing decline in private sector work. While there has been encouraging signs in the reawakening of private sector work with IBI Group receiving mandates for new projects in
Accordingly, IBI Group continued to trim staff levels in those areas affected by the decline, while at the same time adding staff largely through acquisitions as well as recruiting of individuals in those areas of increasing activity. Staff levels in the third quarter averaged 2,227 compared to 2,152 in the second quarter of 2009 and stood at 2,242 at the quarter end compared to 2,212 at the end of the second quarter of 2009. The current staff complement is appropriately sized for the backlog of ongoing committed work at the professional standards of the firm, with some spare capacity. There will, however, continue to be adjustments.
IBI Group has been pro-active in managing the challenges of trimming staff and integrating firms, which is proven out with the results of the third quarter. EBITDA achieved in the third quarter is
During the third quarter, IBI Group progressed with the closing of the acquisition of BFGC Architects, Planners Inc. ("BFGC") with offices in
IBI Group concluded the merger between Stevens Group Architects, ("SGA") and IBI Group Architects in August, 2009. SGA specialises in the architectural design of transit, notably transit stations and related facilities throughout southern Ontario as well as educational facilities. This practice provides immediate strength in the breadth and depth of the IBI Group practice in transit design in southern Ontario, as well as additional resources for work of the firm in other market areas. The educational facilities further strengthen the continuing educational practice of IBI Group in Ontario. Work is underway integrating the activities of this firm together with IBI Group and Giffels. It is notable that the firm is progressing in the establishment and build out of the IBI Group transportation and infrastructure design office combining engineers, architects, landscape architects, systems experts and all other professionals related to such work to provide the most comprehensive set of services on an integrated basis for our clients.
On
The progress in professional work of IBI Group in the third quarter included:
- initiating the work of the large suite of projects in Greece in towing and traffic management which are all now underway; - further expansion of the transit and transportation design practice and progress in the build out of the transportation design office; - further work in health care with additional hospital work underway including the competitive stage for the Women's College Hospital in Toronto; other hospital projects are being initiated in this fourth quarter; - major new transportation work internationally including a major corridor study in the Saudi Kingdom; - major new urban work and planning of new communities in cities in the Middle East and Asia.
The scope of these efforts is validation of IBI Group's integrated operating model of providing comprehensive professional services to clients in
Investor Conference Call
The Fund will hold a conference call on
An audio replay of the call will be available for 14 days, by dialling 416-626-4100 for local and international access, or 1 800 558-5253 for toll-free North American access, passcode 21438686 followed by the number sign on your telephone keypad.
Selected Consolidated Financial Information and Reconciliation of Non- GAAP Measures Three Three Nine Nine months months months months ended ended ended ended September September September September 30, 30, 30, 30, in thousands of dollars 2009 2008 2009 2008 except for per Unit amounts Unaudited Unaudited Unaudited Unaudited Revenue $ 68,783 $ 67,242 $ 205,479 $ 171,587 ---------------------------------------------- Expenses 57,005 54,408 172,481 138,842 ---------------------------------------------- Earnings before income taxes, interest and amortization (EBITDA) 11,777 12,834 32,998 32,745 Interest 1,900 1,352 4,534 2,783 Income taxes 1,166 760 3,350 1,307 Amortisation of property and equipment and intangible assets 3,580 3,315 9,752 7,296 Amortization of deferred credit - leases (28) (51) (84) (154) ---------------------------------------------- Net earnings before non-controlling interest $ 5,159 $ 7,458 $ 15,446 $ 21,513 ---------------------------------------------- Basic and diluted net earnings per Unit $ 0.2918 $ 0.4785 $ 0.9122 $ 1.3751 ---------------------------------------------- Distributable Cash Cash flow used in operating activities $ 1,361 $ 534 $ (536) $ (11,602) Less: Capital expenditures (395) (825) (1,278) (3,785) ---------------------------------------------- Standardized Distributable Cash $ 966 $ (291) $ (1,814) $ (15,387) Add (deduct): Change in non-cash operating working capital 6,891 9,788 24,203 39,236 Current income tax expense 1,625 1,160 4,797 2,328 Income taxes paid (868) (259) (1,509) (1,687) ---------------------------------------------- Distributable Cash $ 8,614 $ 10,398 $ 25,677 $ 24,490 ---------------------------------------------- Weighted average basic and diluted Distributable Cash per Unit(1) $ 0.4872 $ 0.6633 $ 1.5150 $ 1.5622 ---------------------------------------------- Aggregate distributions declared $ 7,074 $ 6,178 $ 20,453 $ 18,066 ---------------------------------------------- Basic and diluted aggregate distributions declared per Unit(1) $ 0.3999 $ 0.3941 $ 1.1997 $ 1.1524 ---------------------------------------------- (1) Distributable Cash per Unit amounts are calculated by including both the Class A partnership units and the Class B partnership units in the denominator.
Definition of EBITDA, Distributable Cash and Non-GAAP Measures
Distributable Cash does not have a standardized meaning prescribed by GAAP, but is a measure generally used by Canadian open-ended income funds as an indicator of financial performance. The Fund defines Distributable Cash as cash flow from operating activities before change in non-cash working capital and income taxes and after capital expenditures and income taxes paid. A reconciliation of Distributable Cash to cash flow from operating activities has been provided under the heading "Selected Consolidated Financial Information and Reconciliation of Non-GAAP Measures".
The Fund's method of calculating distributable cash may differ from similar computations as reported by other similar entities and, accordingly, may not be comparable to distributable cash as reported by such entities. The Fund believes that its distributable cash is a useful supplemental measure that may assist prospective investors in assessing the return on their investment in Units.
References to "EBITDA" are to earnings before interest, income taxes, depreciation and amortization. Management of the Fund believes that in addition to net earnings, EBITDA is a useful supplemental measure as it provides readers with an indication of cash available for distribution prior to debt service, capital expenditures and income taxes. Readers should be cautioned, however, that EBITDA should not be construed as an alternative to net earnings determined in accordance with GAAP as an indicator of the Fund's performance or to cash flows from operating, investing and financing activities as a measure of liquidity and cash flows. EBITDA is not a recognized measure under GAAP and does not have a standardized meaning prescribed by GAAP, and the Fund's method of calculating EBITDA may differ from other issuers. Accordingly, EBITDA may not be comparable to similar measures used by other issuers. A reconciliation of net earnings with EBITDA has been provided under the heading "Selected Consolidated Financial Information and Reconciliation of Non-GAAP Measures"
Discussion in this press release of net earnings before non-controlling interest, EBITDA and distributable cash include the impact of foreign exchange gain (loss) as the Fund believes this provides useful information for readers to assess the performance of the Fund.
%SEDAR: 00021044E
For further information: Allan J. Kamerman, IBI Income Fund, 230 Richmond Street West, 5th Floor, Toronto, ON, M5V 1V6, Tel: (416) 596-1930
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