2011 Third Quarter Financial Results

– Company achieves 5% operating margin, with third quarter net income of $528,000 –

  • Year-to-date revenues up 51%, quarterly revenue up 30% over comparable periods last year
  • Growth of US operations continues – percentage of consolidated quarterly revenues grows to 67%

Toronto, Ontario– July 13, 2011 – Retained executive search firm The Caldwell Partners International Inc. (TSX: CWL) today issued its financial results for the fiscal 2011 third quarter ended May 31, 2011.

All references to quarters or years are for the fiscal periods unless otherwise noted and all currency amounts are in Canadian dollars.

Financial Highlights (in $000s)

Three Months Ended May 31 Nine Months Ended May 31
2011 2010 2011 2010
Operating revenue $ 9,562 $ 7,365 $24,861 $16,478
Expenses 9,054 7,414 25,428 17,868
Operating profit (loss) 508 (49) (568) (1,390)
Investment income 20 158 51 279
Net earnings (loss) before restructuring costs 528 109 (516) (1,111)
Restructuring costs 0 0 0 1,001
Net earnings (loss) $ 528 $ 109 ($516) ($2,112)
Net earnings (loss) per share $ 0.032 $ 0.007 ($0.030) ($0.128)


“We have achieved solid results this past quarter, with consistent year over year growth in our quarterly revenues” said John N. Wallace, chief executive officer. “We continue to focus on improving our overall market presence and competitiveness, and look forward to making targeted, strategic additions to the team when and where it makes sense. We are optimistic that bookings and revenues will remain on pace for the balance of the fiscal year, but, as we have stated in past communications, given the relative size of our client-facing team, our sector focus and market variability, we do expect to experience further fluctuations in our quarterly revenues.”

Wallace continued: “Over the last two years, we have made significant investments in a number of areas of our business. It has been an exciting undertaking to transform this business from a well respected, but local Canadian brand to a strong North American player.”

“We are seeing increased efficiency and productivity as a result of the operational investments we’ve made, and the entire team is focused on the goals at hand – delivering superior service to our clients and improved profitability and sustainable value to our shareholders.”

Financial Highlights (all numbers expressed in $000s)

Operating revenue:

  • Fiscal 2011 third quarter operating revenue increased by 30% over the comparable period last year to $9,562.
  • Revenues generated in the United States of America (US) represent 67% or $6,367 of the third quarter total, increasing 53% year over year from $4,172.
  • Revenues from Canadian operations were flat at $3,195 in the current period from $3,194 in the comparable period of 2010.
  • Nine month operating revenues increased 51% over the same period a year earlier to $24,861. The increase is attributable to strong year over year growth in search revenues in both Canada (up 19%) and the US (up 81%).

Operating profit:

  • Due largely to the significant increase in revenue over last year, the Company generated operating income of $508 in the third quarter of 2011 (2010: loss of $49).
  • The Company achieved an operating margin of 5%, due largely to the increased revenue.
  • Given strong third quarter, year-to-date operating loss significantly reduced to $568 from $1.1 after the first quarter.

Net earnings:

  • Third quarter net earnings after tax was $528 or $0.032 per share in fiscal 2011 as compared to $109 ($0.007 per share) in the comparable period last year.
  • For the nine months, the fiscal 2011 net loss after tax was $568 as compared to a net loss of $2,112 in fiscal 2010. The fiscal 2010 loss includes a one-time restructuring charge of $1.0 million incurred in the second quarter. While the Company carries forward tax losses to offset future taxable income, management has provided a full valuation allowance against these tax losses and has not reflected any benefit of possible future tax recoveries in the Company’s consolidated financial statements.

While focussed on bottom-line returns, the company will continue to take advantage of its financial strength and market opportunities to strategically expand its organization and business, and to build a solid platform for sustainable revenue growth and profitable future returns. These initiatives will continue to require some investment of the company’s capital reserves over a period of time. Management believes that the company has sufficient liquidity and cash resources to fund both its ongoing operations and its strategic growth initiatives.

Operating revenue, gross profit/loss and operating income/loss are non-GAAP (generally accepted accounting principles) measures. The company believes, however, that they provide a useful understanding of the performance of its core human capital services operations as they exclude income or loss from investments and taxes.

For a complete discussion of the quarterly and annual financial results, please see the company’s Management Discussion and Analysis posted on SEDAR at www.sedar.com

Click to read full financial statement

About Caldwell Partners

Caldwell Partners is one of North America’s premier providers of executive search and has been for 40 years. As one of the region’s most trusted advisors in executive search, the firm has a sterling reputation built on successful searches for boards, chief and senior executives, and selected functional experts.

With offices and partners in Vancouver, San Francisco, Los Angeles, Dallas, Calgary, Atlanta, Toronto, Stamford, New York City, and a strategic presence in London, the firm takes pride in delivering an unmatched level of service and expertise to its clients.

Caldwell Partners’ Common shares are listed on The Toronto Stock Exchange (TSX: CWL). Please visit our website at www.caldwell.com for further information.

Forward-Looking Statements

Forward-looking statements in this document are based on current expectations that are subject to significant risks and uncertainties. Actual results might differ materially due to various factors such as the competitive nature of the executive search industry, the ability of the company to execute its growth strategies, the performance of the Canadian domestic and international economies, and the company’s ability to retain key personnel. The Caldwell Partners assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

For further information, please contact:

Investors & Analysts:

Karen Richards, CA, Chief Financial Officer
The Caldwell Partners International
+1 416 934 2228


Caroline Lomot, Director of Marketing
The Caldwell Partners International
+1 416 934 2239

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