- Fourth quarter revenue up 17% over prior year to $10.3 million.
- Company posts annual revenue of $33.8 million, up 3% over prior year.
- Board declares 1.75 cent quarterly dividend, up 17% over prior quarter.
Toronto, Ontario– November 8, 2013 – Retained executive search firm The Caldwell Partners International Inc. (TSX: CWL) today issued its financial results for the fiscal 2013 fourth quarter and year ended August 31, 2013. 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)
*Months Ended August 31
|Three Months Ended Aug 31||Year Ended Aug 31|
|Operating profit (loss)1||946||948||(132)||1,011|
(loss) before tax1
|Net earnings after tax1||793||956||(282)||981|
(loss) per share
*Months Ended August 31
Included in the 2013 results are $0.4 million in severance costs incurred in the third quarter, and a deferral of $0.8 million in operating profit (on $1.4 million deferred revenue) related to a change in estimation methodology for deferred revenue that was implemented in the fourth quarter. As the company does not currently recognize tax assets on operating losses, these items equally impacted net earnings before tax and net earnings after tax.
“Fiscal 2013 turned out to be a year of polarized results. What began as a slow first half of the year in a challenging business climate swung dramatically positive over the course of the second half,” said John Wallace, chief executive officer. “We had a very strong back half, which we attribute to a lift from the economy in Canada and the United States, as well as the fact that as a collective group we have been performing better – our average metrics per partner are up in terms of volume and we are winning more search work. We are feeling positive about both our current momentum and our financial position moving into fiscal 2014.”
Wallace continued: “We made a number of outstanding new partner and staff hires this year – each of whom has brought a palpable and contagious energy to the firm. We are attracting great partners, because they’re joining great partners, and we will continue to make targeted, strategic additions to the team. The investments we have made in growing our business have broadened our footprint, deepened our industry and functional expertise, and extended our brand across North America. We continue forward with our relentless drive and focus to deliver outstanding leaders and an unrivalled level of service to our ever-growing list of discerning clients. Our ongoing success doesn’t hinge solely on the economic climate – it also comes down to our people. We remain intent on attracting the most talented people in the industry and providing them with an environment where they will excel.”
The Board of Directors today also declared the payment of a quarterly dividend of 1.75 cents per Common Share payable December 13, 2013 to shareholders of record on November 25, 2013.
Financial Highlights (all numbers expressed in $000s)
Results for the 2013 fourth quarter and full year were impacted by a change in the estimation of deferred revenue, based on the ability to access enhanced search performance metrics. In the fourth quarter, this resulted in the deferral (reduction) of revenue of $1,358 (2012: $0). This change in methodology has been applied prospectively and does not impact cash flow or cash balances. The Company also deferred the related amount of estimated compensation expense directly associated with such deferred revenue. Reflected in the 2013 fourth quarter and full year is a deferral of compensation expense of $586 (2012: $0). Accordingly, the net impact of the revenue deferral less the compensation expense deferral was to reduce operating profit, net earnings before tax and net earnings after tax by $772 (2012: $0).
- Fourth quarter revenue increased by 17% over the comparable period last year to $10,338. Billings in the fourth quarter were up 32%.
- Revenues from US operations increased 20% (after the revenue deferral of $769 in 2013).
- Revenues from Canadian operations increased 10% (after the revenue deferral of $589 in 2013).
- Sequentially, fourth quarter 2013 revenue was up $1,115 over third quarter 2013 (after the revenue deferral of $1,358 in the fourth quarter).
- Fiscal 2013 revenue increased 3% over fiscal 2012 to $33,803.
- For the fiscal year, US revenue represented 66% of consolidated revenues.
- Fourth quarter 2013 operating profit was $946 (2012: $948).
- Fiscal year 2013 operating loss was $132 (2012: operating profit of $1,011). Fiscal year 2013 includes severance costs of $446 taken in the third quarter 2013.
- Reflected in both the 2013 fourth quarter and full year is the deferral of gross profit of $772 (2012: $0), the net result of the change in estimate for deferred revenue less related deferred compensation expense.
Net earnings after tax:
- Fourth quarter 2013 net earnings after tax were $793, representing $0.045 earnings per share (2012: $956 net earnings after tax, representing $0.056 per share).
- Fiscal year 2013 net loss after tax was $282, representing $0.017 loss per share (2012: $981 net earnings after tax, representing $0.057 per share). Fiscal year 2013 includes severance costs of $446 taken in the third quarter 2013.
- Reflected in both the 2013 fourth quarter and full year is the net earnings deferral of $772 (2012: $0), the net result of the change in estimate for deferred revenue less related deferred compensation expense.
- Fourth quarter and full year results reflect the derecognition of certain tax assets which resulted a non-cash expense in the fourth quarter.
Over the past three years, The Caldwell Partners has transformed from a respected, strictly Canadian brand to a firm with a strong North American presence. At the end of the fourth quarter of fiscal 2013, the firm now has 22 of its total 33 partners located in six American offices, and has established strategic alliances with executive search firms based in London and Hong Kong.
For a complete discussion of the quarterly financial results, please see the company’s Management Discussion and Analysis posted on SEDAR at www.sedar.com
About Caldwell Partners
Caldwell Partners is one of North America’s premier providers of executive search and has been for more than 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 and Hong Kong, 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 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:
Chris Beck, CPA, Chief Financial Officer
The Caldwell Partners International
+1 617 934 1843
Caroline Lomot, Director of Marketing
The Caldwell Partners International
+1 416 934 2239