American Eagle Shares Drop After Q3 Results, Weak Holiday Guidance: Details
American Eagle Outfitters, Inc. AEO reported its third-quarter results after Wednesday’s closing bell. Here’s a look at the details from the report.
The Details: American Eagle Outfitters reported quarterly earnings of 48 cents per share. Revenue came in at $1.28 billion, down from $1.3 billion from the same period last year.
- Total comparable sales increased 3%, following 5% reported comp growth last year.
- Total net revenue of $1.3 billion declined 1%, including approximately $45 million of adverse impact from the retail calendar shift.
- Aerie comparable sales increased 5% on a 12% increase last year.
- American Eagle comparable sales grew 3% following 2% growth last year.
- Gross profit of $527 million decreased 3%.
- Gross margin of 40.9% compared to 41.8% last year, reflecting increased markdowns and expense deleverage related to the retail calendar shift.
Read Next: UnitedHealthcare CEO Brian Thompson Fatally Shot Outside NYC Hotel
“Building on our positive performance in the first half of the year, third-quarter results provide another proof point of the effectiveness of our Powering Profitable Growth Plan. Led by a strong back-to-school season, we achieved comparable sales growth across brands and channels, and delivered adjusted operating income at the high end of our guidance range,” commented Jay Schottenstein, AEO’s CEO.
Outlook: American Eagle sees fourth-quarter comparable sales up approximately 1% with total revenue down 4% year-over-year.
AEO Price Action: According to Benzinga Pro, American Eagle Outfitters shares are down 12.76% after-hours at $17.92 at the time of publication Wednesday.
Read More:
Photo: Courtesy of American Eagle Outfitters, Inc.
Overview Rating:
Speculative
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Synopsys shares fall after sales outlook misses estimates
By Stephen Nellis and Zaheer Kachwala
(Reuters) – Chip design software firm Synopsys on Wednesday forecast fiscal 2025 revenue below Wall Street expectations thanks in part to a slump in China sales as the U.S. tightens controls on what chip technology can be sold to the country.
Shares of the Sunnyvale, California-based company fell 6.6% in extended trading after the forecast. Synopsys Chief Financial Officer Shelagh Glaser told Reuters the company still expects to close its $35 billion deal to acquire engineering software firm Ansys in the first half of 2025.
Synopsys forecast fiscal 2025 revenue in the range of $6.75 billion to $6.8 billion, with the entire range below estimates of $6.91 billion, according to LSEG data.
Glaser said that a change in Synopsys fiscal calendar to make it easier to merge its financial reporting with Ansys lowered the company’s full-year revenue forecast by about $80 million. But the larger driver of the revenue was a continued sales drop in China, where the U.S. earlier this week imposed new limits on chip technology exports.
Glaser said that the list of companies Synopsys can no longer sell to in China has grown, and some of those Chinese customers that remain are hesitating with plans for new chips because of uncertainty around whether they will be able to have the chips manufactured.
“It’s kind of a cumulative impact of restrictions,” Glaser said.
Glaser said the election as U.S. president of Donald Trump, who has promised to impose new tariffs on Chinese imports, did not change Synopsys’ outlook for closing the Ansys deal.
“We certainly have expectations that each jurisdiction has its own criteria and reviews,” Glaser said. “But that actually was true from the beginning, and there was always going to be an election.”
Synopsys forecast adjusted earnings per share for the full year to be between $14.88 and $14.96 per share, while analysts expected $14.88 per share.
The company forecast first-quarter revenue between $1.44 billion and $1.47 billion, compared with estimates of 1.64 billion.
It expects adjusted EPS for the first quarter to be between $2.77 and $2.82 per share, compared with estimates of $3.53 per share.
Revenue for the fourth quarter ended Nov. 2 was $1.63 billion, in line with estimates. On an adjusted basis, the company earned $3.40 per share, above estimates of $3.30 per share.
(Reporting by Zaheer Kachwala in Bengaluru and Stephen Nellis in San Francisco; Editing by Krishna Chandra Eluri and Stephen Coates)
Tecsys Reports Financial Results for the Second Quarter of Fiscal 2025
SaaS revenue up 34% as ARR passes $100 million
MONTREAL, Dec. 4, 2024 /CNW/ — Tecsys Inc. TCS, an industry-leading supply chain management SaaS company, today announced its results for the second quarter of fiscal 2025, ended October 31, 2024. All dollar amounts are expressed in Canadian currency and are prepared in accordance with International Financial Reporting Standards (IFRS).
“Tecsys delivered strong second-quarter results, marked by major milestones in our SaaS business,” said Peter Brereton, president and CEO at Tecsys. “We crossed some key thresholds as RPO surpassed $200 million and ARR exceeded $100 million, demonstrating the strength of our SaaS strategy and the trust our customers place in us. We are seeing the positive impact of our investments in innovation and customer success, positioning us well to capitalize on emerging opportunities.”
Mark Bentler, chief financial officer of Tecsys Inc., added, “Our fiscal 2025 financial performance reflects steady progress across key metrics, with year-to-date SaaS bookings up 20% over last year and our SaaS margins continuing to improve as we scale the business and continue to invest in platform optimization.”
Second quarter highlights:
- SaaS revenue increased by 34% to $16.1 million, up from $12.1 million in Q2 2024.
- SaaS subscription bookingsi (measured on an ARRi basis) were $3.7 million, flat compared to the second quarter of fiscal 2024.
- SaaS Remaining Performance Obligation (RPOi) increased by 39% to $203.8 million at October 31, 2024, up from $146.7 million at the same time last year.
- Total revenue increased to $42.4 million compared to $41.5 million in Q2 2024.
- Net profit was $0.8 million or $0.05 per share on a fully diluted basis in Q2 2025, compared to a net loss of $0.3 million or $0.02 per share for the same period in fiscal 2024.
- Adjusted EBITDAii was $2.9 million compared to $1.0 million reported in Q2 last year.
- In the second quarter of fiscal 2025, Tecsys acquired 51,600 of its outstanding common shares for approximately $2.1 million as part of its ongoing Normal Course Issuer Bid, compared to 25,800 shares acquired in the same period last year for approximately $0.7 million.
Year-to-date performance for first half of fiscal 2025
- SaaS revenue increased by 33% to $31.4 million, up from $23.6 million in the same period of fiscal 2024.
- SaaS subscription bookingsi (measured on an ARRi basis) increased by 20% to $6.8 million, compared to $5.7 million in the same period of fiscal 2024.
- Total revenue increased to $84.7 million compared to $83.5 million in the same period of fiscal 2024.
- Net profit was $1.6 million ($0.11 per basic share or $0.10 per fully diluted share) in the first half of fiscal 2025, compared to a net profit of $0.8 million ($0.06 per basic and fully diluted share) for the same period in fiscal 2024.
- Adjusted EBITDAii was $5.5 million compared to $4.2 million reported in the same period of fiscal 2024.
- In the first half of fiscal 2025, Tecsys acquired 111,200 of its outstanding common shares for approximately $4.3 million as part of its ongoing Normal Course Issuer Bid, compared to 25,800 shares acquired in the same period last year for $0.7 million.
Financial guidance:
Tecsys is maintaining FY25 guidance on SaaS revenue growth at 30-32% as well as FY25 and FY26 adjusted EBITDA margins at 8-9% and 10-11%, respectively. Based on the ongoing unpredictability of hardware revenue and a rapidly evolving business model that is impacting professional services, Tecsys is revising Fiscal 2025 total revenue guidance to roughly flat.
On December 4, 2024, the Company declared a quarterly dividend of $0.085 per share to be paid on January 3, 2025 to shareholders of record on December 18, 2024.
Pursuant to the Canadian Income Tax Act, dividends paid by the Company to Canadian residents are considered to be “eligible” dividends.
i See Key Performance Indicators in Management’s Discussion and Analysis of the Q2 2025 Financial Statements. |
ii See Non-IFRS Performance Measures in Management’s Discussion and Analysis of the Q2 2025 Financial Statements |
Q2 2025 Financial Results Conference Call
Date: December 5, 2024
Time: 8:30 a.m. ET
Phone number: 800-836-8184 or 646-357-8785
The call can be replayed until December 12, 2024, by calling:
888-660-6345 or 646-517-4150 (access code: 91117#)
About Tecsys
Tecsys is a global provider of advanced supply chain solutions. With a commitment to innovation and customer success, the company equips organizations with the essential software, technology and expertise needed for operational excellence and competitive advantage. Its cloud solutions serve a diverse range of industries, including healthcare, distribution and converging commerce, across multiple complex, regulated and high-volume markets. Built on the Itopia® low-code application platform, Tecsys’ offerings include enterprise resource planning, warehouse management, consolidated service management, distribution and transportation management, supply management at the point of use and order management solutions. Tecsys provides critical data insights and control across the supply chain, ensuring that organizations are agile, responsive and scalable.
Tecsys is publicly traded on the Toronto Stock Exchange under the ticker symbol TCS. For more about Tecsys and its solutions, please visit www.tecsys.com.
Forward Looking Statements
The statements in this news release relating to matters that are not historical fact are forward-looking statements that are based on management’s beliefs and assumptions. Such statements are not guarantees of future performance and are subject to a number of uncertainties, including but not limited to future economic conditions, the markets that Tecsys Inc. serves, the actions of competitors, major new technological trends, and other factors beyond the control of Tecsys Inc., which could cause actual results to differ materially from such statements. More information about the risks and uncertainties associated with Tecsys Inc.’s business can be found in the MD&A section of the Company’s annual report and the most recently filed annual information form. These documents have been filed with the Canadian securities commissions and are available on our website (www.tecsys.com) and on SEDAR+ (www.sedarplus.ca).
Copyright © Tecsys Inc. 2024. All names, trademarks, products, and services mentioned are registered or unregistered trademarks of their respective owners.
Non-IFRS Measures
Reconciliation of EBITDA and Adjusted EBITDA
EBITDA is calculated as earnings before interest expense, interest income, income taxes, depreciation and amortization. Adjusted EBITDA is calculated as EBITDA before stock-based compensation and restructuring costs. The exclusion of interest expense, interest income, income taxes and restructuring costs eliminates the impact on earnings derived from non-operational activities and non-recurring items, and the exclusion of depreciation, amortization and stock-based compensation eliminates the non-cash impact of these items.
The Company believes that these measures are useful measures of financial performance without the variation caused by the impacts of the items described above and that could potentially distort the analysis of trends in our operating performance. In addition, they are commonly used by investors and analysts to measure a company’s performance, its ability to service debt and to meet other payment obligations, or as a common valuation measurement. Excluding these items does not imply that they are necessarily non-recurring. Management believes these non-IFRS financial measures, in addition to conventional measures prepared in accordance with IFRS, enable investors to evaluate the Company’s operating results, underlying performance and future prospects in a manner similar to management. Although EBITDA and Adjusted EBITDA are frequently used by securities analysts, lenders and others in their evaluation of companies, they have limitations as an analytical tool, and should not be considered in isolation, or as a substitute for analysis of the Company’s results as reported under IFRS.
The reconciliation of EBITDA and Adjusted EBITDA to the most directly comparable IFRS measure is provided below.
Three months ended October 31, |
Six months ended October 31, |
Trailing 12 months ended October 31, |
||||||||||
(in thousands of CAD) |
2024 |
2023 |
2024 |
2023 |
2024 |
2023 |
||||||
Net profit (loss) for the period |
$ |
758 |
$ |
(340) |
$ |
1,556 |
$ |
831 |
$ |
2,574 |
$ |
2,165 |
Adjustments for: |
||||||||||||
Depreciation of property and equipment and right-of-use assets |
377 |
377 |
748 |
761 |
1,464 |
1,677 |
||||||
Amortization of deferred development costs |
198 |
147 |
395 |
289 |
689 |
569 |
||||||
Amortization of other intangible assets |
328 |
394 |
662 |
790 |
1,365 |
1,603 |
||||||
Interest expense |
24 |
53 |
49 |
91 |
121 |
200 |
||||||
Interest income |
(163) |
(253) |
(380) |
(522) |
(873) |
(954) |
||||||
Income taxes |
427 |
(81) |
863 |
778 |
726 |
1,988 |
||||||
EBITDA |
$ |
1,949 |
$ |
297 |
$ |
3,893 |
$ |
3,018 |
$ |
6,066 |
$ |
7,248 |
Adjustments for: |
||||||||||||
Stock based compensation |
993 |
724 |
1,640 |
1,176 |
2,765 |
2,169 |
||||||
Restructuring costs |
– |
– |
– |
– |
2,122 |
– |
||||||
Adjusted EBITDAii |
$ |
2,942 |
$ |
1,021 |
$ |
5,533 |
$ |
4,194 |
$ |
10,953 |
$ |
9,417 |
Condensed Interim Consolidated Statements of Financial Position (In thousands of Canadian dollars)
|
||||
October 31, 2024 |
April 30, 2024 |
|||
Assets |
||||
Current assets |
||||
Cash and cash equivalents |
$ |
16,848 |
$ |
18,856 |
Short-term investments |
11,496 |
16,713 |
||
Accounts receivable |
21,846 |
22,090 |
||
Work in progress |
4,498 |
4,248 |
||
Other receivables |
375 |
134 |
||
Tax credits |
8,704 |
6,422 |
||
Inventory |
2,116 |
1,359 |
||
Prepaid expenses and other |
8,227 |
9,143 |
||
Total current assets |
74,110 |
78,965 |
||
Non-current assets |
||||
Other long-term receivables and assets |
545 |
421 |
||
Tax credits |
5,748 |
4,737 |
||
Property and equipment |
1,255 |
1,372 |
||
Right-of-use assets |
1,044 |
1,251 |
||
Contract acquisition costs |
4,356 |
4,478 |
||
Deferred development costs |
3,173 |
2,683 |
||
Other intangible assets |
7,196 |
7,703 |
||
Goodwill |
17,570 |
17,363 |
||
Deferred tax assets |
9,073 |
9,073 |
||
Total non-current assets |
49,960 |
49,081 |
||
Total assets |
$ |
124,070 |
$ |
128,046 |
Liabilities |
||||
Current liabilities |
||||
Accounts payable and accrued liabilities |
18,933 |
20,030 |
||
Deferred revenue |
36,925 |
36,211 |
||
Lease obligations |
834 |
812 |
||
Total current liabilities |
56,692 |
57,053 |
||
Non-current liabilities |
||||
Other long-term accrued liabilities |
568 |
496 |
||
Deferred tax liabilities |
649 |
826 |
||
Lease obligations |
890 |
1,302 |
||
Total non-current liabilities |
2,107 |
2,624 |
||
Total liabilities |
$ |
58,799 |
$ |
59,677 |
Equity |
||||
Share capital |
$ |
52,628 |
$ |
52,256 |
Contributed surplus |
6,970 |
9,417 |
||
Retained earnings |
7,309 |
8,121 |
||
Accumulated other comprehensive loss |
(1,636) |
(1,425) |
||
Total equity attributable to the owners of the Company |
65,271 |
68,369 |
||
Total liabilities and equity |
$ |
124,070 |
$ |
128,046 |
Condensed Interim Consolidated Statements of Income (loss) and Comprehensive Income (loss) (In thousands of Canadian dollars, except per share data)
|
||||||||
Three Months Ended October 31, |
Six Months Ended October 31, |
|||||||
2024 |
2023 |
2024 |
2023 |
|||||
Revenue: |
||||||||
SaaS |
$ |
16,130 |
$ |
12,072 |
$ |
31,444 |
$ |
23,567 |
Maintenance and Support |
7,703 |
8,899 |
16,418 |
17,197 |
||||
Professional Services |
14,145 |
12,869 |
27,532 |
27,777 |
||||
License |
444 |
252 |
1,305 |
708 |
||||
Hardware |
4,020 |
7,397 |
8,019 |
14,215 |
||||
Total revenue |
42,442 |
41,489 |
84,718 |
83,464 |
||||
Cost of revenue |
21,994 |
23,144 |
44,542 |
45,619 |
||||
Gross profit |
20,448 |
18,345 |
40,176 |
37,845 |
||||
Operating expenses: |
||||||||
Sales and marketing |
9,052 |
8,645 |
17,404 |
16,316 |
||||
General and administration |
3,199 |
2,971 |
6,177 |
5,930 |
||||
Research and development, net of tax credits |
7,205 |
7,133 |
14,536 |
14,245 |
||||
Total operating expenses |
19,456 |
18,749 |
38,117 |
36,491 |
||||
Profit (loss) from operations |
992 |
(404) |
2,059 |
1,354 |
||||
Other income (costs) |
193 |
(17) |
360 |
255 |
||||
Profit (loss) before income taxes |
1,185 |
(421) |
2,419 |
1,609 |
||||
Income tax expense (benefit) |
427 |
(81) |
863 |
778 |
||||
Net profit (loss) |
$ |
758 |
$ |
(340) |
$ |
1,556 |
$ |
831 |
Other comprehensive income (loss): |
||||||||
Effective portion of changes in fair value on designated revenue hedges |
(513) |
(5,573) |
(533) |
(3,000) |
||||
Exchange differences on translation of foreign operations |
165 |
92 |
322 |
(334) |
||||
Comprehensive income (loss) |
$ |
410 |
$ |
(5,821) |
$ |
1,345 |
$ |
(2,503) |
Basic earnings (loss) per common share |
$ |
0.05 |
$ |
(0.02) |
$ |
0.11 |
$ |
0.06 |
Diluted earnings (loss) per common share |
$ |
0.05 |
$ |
(0.02) |
$ |
0.10 |
$ |
0.06 |
Condensed Interim Consolidated Statements of Cash Flows (In thousands of Canadian dollars)
|
||||||||
Three Months Ended October 31, |
Six Months Ended October 31, |
|||||||
2024 |
2023 |
2024 |
2023 |
|||||
Cash flows from operating activities: |
||||||||
Net profit (loss) |
$ |
758 |
$ |
(340) |
$ |
1,556 |
$ |
831 |
Adjustments for: |
||||||||
Depreciation of property and equipment and right-of-use-assets |
377 |
377 |
748 |
761 |
||||
Amortization of deferred development costs |
198 |
147 |
395 |
289 |
||||
Amortization of other intangible assets |
328 |
394 |
662 |
790 |
||||
Interest (income) expense and foreign exchange (gain) loss |
(193) |
17 |
(360) |
(255) |
||||
Unrealized foreign exchange and other |
206 |
600 |
83 |
(598) |
||||
Non-refundable tax credits |
(505) |
(774) |
(934) |
(1,214) |
||||
Stock-based compensation |
993 |
724 |
1,640 |
1,176 |
||||
Income taxes |
184 |
362 |
187 |
376 |
||||
Net cash from operating activities excluding changes in non-cash working capital items related to operations |
2,346 |
1,507 |
3,977 |
2,156 |
||||
Accounts receivable |
(2,132) |
4,045 |
302 |
2,225 |
||||
Work in progress |
2,245 |
(1,390) |
(241) |
(2,219) |
||||
Other receivables and assets |
84 |
214 |
(436) |
(48) |
||||
Tax credits |
(1,325) |
(1,248) |
(2,359) |
(2,319) |
||||
Inventory |
(40) |
(242) |
(754) |
(1,084) |
||||
Prepaid expenses |
60 |
(358) |
963 |
(641) |
||||
Contract acquisition costs |
119 |
137 |
80 |
140 |
||||
Accounts payable and accrued liabilities |
1,119 |
273 |
(2,000) |
(3,293) |
||||
Deferred revenue |
3,652 |
1,246 |
691 |
2,622 |
||||
Changes in non-cash working capital items related to operations |
3,782 |
2,677 |
(3,754) |
(4,617) |
||||
Net cash provided by (used in) operating activities |
6,128 |
4,184 |
223 |
(2,461) |
||||
Cash flows from financing activities: |
||||||||
Payment of lease obligations |
(204) |
(199) |
(402) |
(398) |
||||
Payment of dividends |
(2,368) |
(2,208) |
(2,368) |
(2,208) |
||||
Interest paid |
(24) |
(53) |
(49) |
(91) |
||||
Issuance of common shares on exercise of stock options |
320 |
881 |
597 |
2,644 |
||||
Shares repurchased and cancelled |
(2,101) |
(673) |
(4,312) |
(673) |
||||
Net cash used in financing activities |
(4,377) |
(2,252) |
(6,534) |
(726) |
||||
Cash flows from investing activities: |
||||||||
Interest received |
3 |
33 |
27 |
69 |
||||
Transfers from short-term investments |
5,022 |
– |
5,570 |
22 |
||||
Acquisitions of property and equipment |
(200) |
(163) |
(409) |
(265) |
||||
Deferred development costs |
(433) |
(253) |
(885) |
(500) |
||||
Net cash provided by (used in) investing activities |
4,392 |
(383) |
4,303 |
(674) |
||||
Net increase (decrease) in cash and cash equivalents during the period |
6,143 |
1,549 |
(2,008) |
(3,861) |
||||
Cash and cash equivalents – beginning of period |
10,705 |
15,825 |
18,856 |
21,235 |
||||
Cash and cash equivalents – end of period |
$ |
16,848 |
$ |
17,374 |
$ |
16,848 |
$ |
17,374 |
Condensed Interim Consolidated Statements of Changes in Equity (In thousands of Canadian dollars, except number of shares)
|
|||||||||||
Share capital |
Contributed |
Accumulated other |
Retained |
Total |
|||||||
Number |
Amount |
||||||||||
Balance, May 1, 2024 |
14,840,150 |
$ |
52,256 |
$ |
9,417 |
$ |
(1,425) |
$ |
8,121 |
$ |
68,369 |
Net profit |
– |
– |
– |
– |
1,556 |
1,556 |
|||||
Other comprehensive (loss) income: |
|||||||||||
Effective portion of changes in fair value on designated revenue hedges |
– |
– |
– |
(533) |
– |
(533) |
|||||
Exchange difference on translation of foreign operations |
– |
– |
– |
322 |
– |
322 |
|||||
Total comprehensive (loss) income |
– |
– |
– |
(211) |
1,556 |
1,345 |
|||||
Shares repurchased and cancelled |
(111,200) |
(394) |
(3,918) |
– |
– |
(4,312) |
|||||
Stock-based Compensation |
– |
– |
1,640 |
– |
– |
1,640 |
|||||
Dividends to equity owners |
– |
– |
– |
– |
(2,368) |
(2,368) |
|||||
Share options exercised |
23,899 |
766 |
(169) |
– |
– |
597 |
|||||
Total transactions with owners of the Company |
(87,301) |
$ |
372 |
(2,447) |
$ |
– |
$ |
(2,368) |
$ |
(4,443) |
|
Balance, October 31, 2024 |
14,752,849 |
$ |
52,628 |
$ |
6,970 |
$ |
(1,636) |
$ |
7,309 |
$ |
65,271 |
Balance, May 1, 2023 |
14,582,837 |
$ |
44,338 |
15,285 |
$ |
(17) |
$ |
10,832 |
$ |
70,438 |
|
Net profit |
– |
– |
– |
– |
831 |
831 |
|||||
Other comprehensive income: |
– |
||||||||||
Effective portion of changes in fair value on designated revenue hedges |
– |
– |
– |
(3,000) |
– |
(3,000) |
|||||
Exchange difference on translation of foreign operations |
– |
– |
– |
(334) |
– |
(334) |
|||||
Total comprehensive (loss) income |
– |
– |
– |
(3,334) |
831 |
(2,503) |
|||||
Shares repurchased and cancelled |
(25,800) |
(84) |
(589) |
– |
– |
(673) |
|||||
Stock-based Compensation |
– |
– |
1,176 |
– |
– |
1,176 |
|||||
Dividends to equity owners |
– |
– |
– |
– |
(2,208) |
(2,208) |
|||||
Share options exercised |
161,249 |
3,388 |
(744) |
– |
– |
2,644 |
|||||
Total transactions with owners of the Company |
135,449 |
$ |
3,304 |
(157) |
$ |
– |
$ |
(2,208) |
$ |
939 |
|
Balance, October 31, 2023 |
14,718,286 |
$ |
47,642 |
15,128 |
$ |
(3,351) |
$ |
9,455 |
$ |
68,874 |
SOURCE Tecsys Inc.
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/December2024/04/c3785.html
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Carriage Services Welcomes John Enwright as Senior Vice President, Chief Financial Officer and Treasurer
HOUSTON, Dec. 04, 2024 (GLOBE NEWSWIRE) — Carriage Services, Inc. CSV (“Carriage” or the “Company”) is excited to announce the appointment of John Enwright as Senior Vice President, Chief Financial Officer and Treasurer, effective January 2, 2025.
With more than 25 years of extensive financial leadership experience in omnichannel retail, Mr. Enwright brings a proven track record of driving results and fostering innovation at prominent publicly traded companies. Most recently, he served as Chief Financial Officer for Edible Brands, LLC, following a successful eight-year tenure at Vera Bradley, Inc., where he spent five years as Chief Financial Officer, following several years as Vice President of Financial Planning and Analysis. His earlier career at Tiffany & Company, where he spent 15 years, equipped him with invaluable expertise in financial planning, treasury, and business transformation.
Mr. Enwright’s strategic insights and extensive leadership experience will play a critical role as Carriage continues to focus on its three strategic objectives: disciplined capital allocation, purposeful growth, and relentless improvement. His appointment signals the Company’s commitment to building a best-in-class leadership team to drive its ambitious goals and continue its transformative growth story.
“We are excited to welcome John to Carriage,” said Carlos R. Quezada, Chief Executive Officer and Vice Chairman of the Board of Directors. “John’s dynamic leadership and deep financial expertise will be instrumental as we elevate Carriage to the next level of financial sophistication. His vision and strategic acumen will help us accelerate our growth, enhance operational excellence, and deliver premier experiences for our clients and communities. We are confident John’s contributions will strengthen our foundation and propel us toward achieving our long-term vision of success.
Carriage is poised for an exciting future, and John’s addition underscores the Company’s relentless pursuit of excellence, innovation, and growth,” concluded Mr. Quezada.
About Carriage Services, Inc.
Carriage Services is a leading provider of funeral and cemetery services and merchandise in the United States and operates 162 funeral homes in 26 states and 31 cemeteries in 11 states. It is dedicated to delivering premier experiences through innovation, partnership, and elevated service. For more information, visit www.carriageservices.com.
Cautionary Statement on Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which the Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. These certain forward-looking statements include, but are not limited to, any projections or expectations related to Mr. Enwright’s appointment; any statements of the plans, strategies and objectives of management for future operations or financial activities, including, but not limited to, capital allocation, organizational performance, and execution of our strategic objectives and growth plan; any statements of belief; and any statements of assumptions underlying any of the foregoing, and are based on our current expectations and beliefs concerning future developments and their potential effect on the Company. The foregoing review of important factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in the Company’s most recent Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q and other documents of the Company on file with the SEC. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of the applicable communication and we undertake no obligation to publicly update or revise any forward-looking statements except to the extent required by applicable law. A copy of the Company’s most recent Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, and other information about the Company and news releases, are available at http://www.carriageservices.com.
For more information, please contact InvestorRelations@carriageservices.com
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
NexPoint to Hold Video Call for UDF IV Shareholders on Friday, December 6 to Provide Updates on Transaction with Ready Capital and Upcoming Board Election and Annual Meeting
Call Will Take Place on Friday, December 6 at 11:00 a.m. CST / 12:00 p.m. EST
NexPoint to Discuss Transaction’s Impact to UDF IV Shareholders and Implications for Election and Annual Meeting Next Week
DALLAS, Dec. 4, 2024 /PRNewswire/ — NexPoint Real Estate Opportunities, LLC (together with its affiliates “NexPoint”) today announced that it will hold a video call for shareholders of United Development Funding IV (“UDF IV” or the “Company”) to provide updates on the Board of Trustees election and Annual Meeting.
On the call, members of the NexPoint leadership team will discuss the proposed acquisition of UDF IV by Ready Capital Corporation (“Ready Capital”), which was announced earlier this week.
Call Details and Registration Information:
Attendees can submit questions ahead of time using the registration link or via email at ir@nexpoint.com.
The call seeks to ensure UDF IV shareholders, as well as financial advisors and other shareholder representatives, have complete and accurate information to vote in the critical election for the UDF IV Board of Trustees at the Annual Meeting of Shareholders next week.
For more information on the election and upcoming meeting, visit udfaccountability.com/2024-annual-meeting.
About NexPoint
NexPoint Real Estate Opportunities, LLC is a wholly owned subsidiary of NexPoint Diversified Real Estate Trust, Inc. NXDT, an affiliate of NexPoint Advisors, L.P.
NexPoint Advisors, L.P. is an SEC-registered adviser on the NexPoint alternative investment platform. It serves as the adviser to a suite of funds and investment vehicles, including a closed-end fund, interval fund, business development company, and various real estate vehicles. For more information visit www.nexpoint.com
IMPORTANT INFORMATION
NexPoint Real Estate Opportunities, LLC (“NexPoint”) intends to deliver a proxy statement with respect to its solicitation of proxies for nominees to be elected to the United Development Funding IV (“UDF IV”) Board of Trustees at the Annual Meeting of Shareholders of UDF IV. The date for the Annual Meeting has not yet been set and NexPoint is not soliciting proxies at this time. INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE NEXPOINT PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) WHEN AVAILABLE IN ITS ENTIRETY BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION ABOUT ANY SOLICITATION. Copies of the documents will be made available free of charge from NexPoint by accessing the website www.udfaccountability.com.
NexPoint, its affiliates, their directors and executive officers and other members of management and employees may be participants (collectively “Participants”) in the solicitation of proxies by NexPoint. Information about NexPoint’s nominees to the UDF IV Board of Trustees and information regarding the direct or indirect interests in UDF IV, by security holdings or otherwise, of NexPoint, the other Participants and NexPoint’s nominees will be available in the proxy statement. NexPoint’s disclosure of any security holdings will be based on information made available to NexPoint by such Participants and nominees. UDF IV is no longer subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. Consequently, NexPoint’s knowledge of significant security holders of UDF IV and as to UDF IV itself is limited.
CONTACT INFORMATION
UDF IV Investor Contacts
Chuck Garske / Jeremy Provost / Theo Caminiti (Okapi Partners):
Email: info@okapipartners.com
Phone: (212) 297-0720
For Additional Information/Updates on UDF IV
Website: www.udfaccountability.com
Email: udfinvestors@nexpoint.com
Media Contacts
Lucy Bannon (NexPoint): lbannon@nexpoint.com
Paul Caminiti/Pamela Greene (Reevemark): nexpointteam@reevemark.com
NexPoint Investor Relations
Kristen Thomas: ir@nexpoint.com
SOURCE NexPoint Advisors, L.P.
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
EQB reports record annual earnings, dividend increase and growth guidance
EQB changed its fiscal year in 2023 to end October 31, resulting in a one-time ten-month transition year and a four-month final quarter of 2023. As a result, the comparisons below are shown year-over-year from the fourth quarter ending October 31, 2023, as the most similar and comparable three-month period (“y/y”). The information contained in this news release is unaudited.
TORONTO, Dec. 4, 2024 /PRNewswire/ – EQB Inc. EQB today reported record financial results for the fiscal year ended October 31, 2024, underpinned by 9% annual growth in loans under management, higher non-interest revenue and a substantial increase in EQ Bank customer accounts crossing over half a million. On the strength of this performance and a favourable outlook for personal and commercial loan originations in fiscal 2025, EQB raised its common share dividend and issued medium-term growth guidance anchored in a 15%+ ROE.
“This year marks our second decade as a publicly traded company and our most profitable year on record, with annual revenue surpassing $1 billion for the first time. Shareholder value creation, including ROE at 15% and four consecutive quarters of dividend increases, once again reflected efficient capital allocation and underlying business strength,” said Andrew Moor, president and CEO, EQB.
While EQB generated record earnings for fiscal 2024, its Q4 results were negatively impacted by credit provisions in its equipment financing portfolio, including one particular credit exposure. This resulted in higher-than-anticipated provisions for credit losses (PCLs) for the quarter. As part of its continued strategic review of the equipment financing business, EQB has instated measures to derisk and diversify this modest portfolio, including shifting to higher credit quality exposures.
- Adjusted ROE1 Q4 13.1% and FY24 15.0% (reported Q4 10.2% and FY24 13.8%)
- Adjusted diluted EPS1 Q4 $2.51 and FY24 $11.03 (reported Q4 $1.95 and FY24 $10.11)
- Book value per share $77.51, +2% q/q, +10% y/y
- Adjusted revenue Q4 $321.6 million and FY24 $1,264.2 million (reported Q4 $312.8 million and FY24 $1,255.4 million)
- Net interest margin2 Q4 2.07% and FY24 2.05%
- Adjusted PPPT3 Q4 $173.0 million and FY24 $692.9 million (reported Q4 $159.1 million and FY24 $661.3 million)
- Adjusted net income1 Q4 $101.4 million, and FY24 $438.0 million (reported Q4 $79.4 million and FY24 $401.7 million)
- Total AUM + AUA2 $127.0 billion, +1% q/q, +14% y/y
- EQ Bank customer growth +6% q/q and +28% y/y to over 513,000 customers
- Common share dividends $0.49 per share declared, increasing 2 cents or +4% q/q, +23% y/y
- Total capital ratio 15.6% with CET1 of 14.3%
“Looking to 2025, we expect easing monetary policy will provide welcome relief for borrowers and drive loan origination growth across the bank. This new rate cycle will also bring into sharp focus the compelling value of our high interest, no-fee EQ Bank offerings as we enter our next phase of growth. I thank all members of Canada’s Challenger Bank™ for driving change in Canadian banking to enrich people’s lives with the innovation and value for which we are known,” added Mr. Moor.
EQ Bank welcomes over 28,000 customers in Q4 growing to 513,000, +6% q/q and +28% y/y
- The Notice Savings Account, launched mid-year, continues to act as a significant customer and deposit growth driver for EQ Bank, deepening its everyday bank value proposition
- Beta launch of the EQ Bank Business Account, a high-interest, no-fee everyday bank account uniquely designed to suit Canadian small business owners’ needs, warmly welcomed by the small business community in Canada with roll-out continuing through 2025
- EQ Bank named Brand of the Year by strategy magazine, recognized for its recent “Second Chance” and “Deuxième Chance” campaigns and corresponding impact on brand awareness
Personal Banking LUM steady on strong customer retention, decumulation business grows +47% y/y in line with guidance
- The single-family uninsured portfolio increased 1% q/q to $20.0 billion, as strong customer retention offset the impact of slower housing market activity on new originations
- Single-family insured lending declined 7% q/q to $9.2 billion as a result of a purposeful shift away from lower margin prime mortgages; going forward, EQB will focus on growing uninsured single-family lending through its differentiated and well recognized customer and broker experience advantage
- Decumulation lending (including reverse mortgages and insurance lending) +10% q/q and +47% y/y to $2.1 billion with growth accelerating as a result of successful consumer advertising that bolstered public awareness, strong broker service and value to borrowers
Commercial Banking LUM led by 30% y/y expansion in multi-unit residential to $26.1B
- EQB continues to prioritize insured lending for multi-unit residential properties (primarily rental apartments) in major cities across the country with 81% of its total commercial loans under management (LUM) insured through various CMHC programs; insured multi-unit residential LUM +8% q/q and +30% y/y to $26.1 billion
- As a result of the Bank’s lending focus on properties where people live, it maintains limited exposure to the Canadian commercial office real estate market (~0.5% of loan assets), and those balances declined in Q4; consistent with the Bank’s long-term risk appetite, commercial office lending is generally confined to multi-tenanted, mixed-used properties occupied by medical and professional businesses
Increased PCL primarily driven by equipment financing with expected improvement in FY25
- The Bank is appropriately reserved for credit losses with net allowances as a percentage of total loan assets of 32 bps, compared to 26 bps at July 31, 2024, and 22 bps at October 31, 2023
- Total Q4 adjusted PCL of $31.9 million (reported $48.0 million in Q4), or 27bps of total loan assets, includes $16 million from equipment financing PCL, $5.2 million from personal and $10.7 million from commercial excluding equipment financing
- Of FY24 adjusted PCL of $89.2 million, 71% is attributable to equipment financing, including anomalous losses associated with Pride Group exposure; following elevated provisions and losses booked in Q4, performance is expected to significantly improve in FY25
- Reflected in Q4 reported results is the Bank’s previously identified operational exposure and losses associated with Pride Group; as part of the active Companies’ Creditors Arrangement Act process for Pride Group and the operational exposure associated with suspected irregularities, expected credit losses associated with these leases have been separated from normal course business but remain accounted for in PCL
- Net impaired loans increased by $97.0 million to $623.7 million, or 132 bps of total loan assets, compared to 109 bps at July 31, 2024, and 76 bps from October 31, 2023; half of which can be attributed to one commercial loan. While the pace of resolutions is improving, declines in impaired loans are expected by the second half of fiscal 2025
EQB increases common share dividend
- EQB’s Board of Directors declared a dividend of $0.49 per common share payable on December 31, 2024, to shareholders of record as of December 13, 2024, representing a 4% increase from the dividend paid in September 2024 and 23% above the payment made in December 2023
- For the purposes of the Income Tax Act (Canada) and any similar provincial legislation, dividends declared are eligible dividends, unless otherwise indicated
EQB issues updated growth guidance
- FY25 and medium term guidance for adjusted pre-provision pre-tax earnings, adjusted diluted EPS, adjusted ROE, dividends, book value per share, CET1 ratio and balance sheet growth are found in Supplementary Management Information in the Financials section of EQB’s investor website at eqb.investorroom.com and which will be included in EQB’s Q4 2024 MD&A to be filed under EQB’s profile on www.sedarplus.ca
- EQB has a Normal Course Issuer Bid (NCIB) that expires in January 2025 and intends to renew and increase the size of its NCIB for the following twelve-month period which gives it additional options for capital deployment.4
“We are proud of EQB’s strategic progress in fiscal 2024, particularly considering the economic environment and atypical pressure in our credit book. The diversification and strength of our business model translated to solid ROE and excellent growth in key asset classes. Excluding the elevated equipment financing credit losses, EQB would have achieved the high-end of 2024 expectations,” said Chadwick Westlake, CFO, EQB. “Our updated growth guidance reflects our bullish view on loan origination prospects, tailwinds for provisioning given steps taken in equipment financing in Q4 and the expectation for significant improvement in impaired loans. While our first priority in capital allocation remains organic lending growth, we continue to assess select inorganic growth opportunities, and we have levers for returning capital to shareholders that collectively position us for strength in 2025.”
1 Adjusted measures and ratios are Non-Generally Accepted Accounting Principles (GAAP) measures and ratios. Adjusted measures and ratios are calculated in the same manner as reported measures and ratios, except that financial information included in the calculation of adjusted measures and ratios is adjusted to exclude the impact of the Concentra Bank and ACM acquisition and integration related costs, and other non-recurring items which management determines would have a significant impact on a reader’s assessment of business performance. For additional information and a reconciliation of reported results to adjusted results, see the “Non-GAAP financial measures and ratios” section. |
2 These are non-GAAP measures, see the “Non-GAAP financial measures and ratios” section. |
3 PPPT represents pre-provision-pre-tax income, a non-GAAP measure of financial performance. |
4 Subject to regulatory approvals. |
Analyst conference call and webcast: 10:30 a.m. ET December 5, 2024
EQB’s Andrew Moor, president and CEO, Chadwick Westlake, CFO, and Marlene Lenarduzzi, CRO, will host the company’s fourth quarter conference call and webcast. The listen-only webcast with accompanying slides will be available at: eqb.investorroom.com. To access the conference call with operator assistance, dial 416-945-7677 five minutes prior to the start time.
Further information
Further information on EQB’s unaudited Q4 and 2024 results may be found under the Financials section of the EQB investor website at eqb.investorroom.com.
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
Consolidated balance sheet (unaudited)
($000s) As at |
October 31, 2024 |
October 31, 2023 |
Assets: |
||
Cash and cash equivalents |
591,641 |
549,474 |
Restricted cash |
971,987 |
767,195 |
Securities purchased under reverse repurchase agreements |
1,260,118 |
908,833 |
Investments |
1,627,314 |
2,120,645 |
Loans – Personal |
32,273,551 |
32,390,527 |
Loans – Commercial |
14,760,367 |
14,970,604 |
Securitization retained interests |
813,719 |
559,271 |
Deferred tax assets |
36,104 |
14,230 |
Other assets |
899,120 |
652,675 |
Total assets |
53,233,921 |
52,933,454 |
Liabilities and Shareholders’ Equity |
||
Liabilities: |
||
Deposits |
33,739,612 |
31,996,450 |
Securitization liabilities |
14,594,304 |
14,501,161 |
Obligations under repurchase agreements |
– |
1,128,238 |
Deferred tax liabilities |
177,933 |
128,436 |
Funding facilities |
946,956 |
1,731,587 |
Other liabilities |
636,931 |
602,039 |
Total liabilities |
50,095,736 |
50,087,911 |
Shareholders’ Equity: |
||
Preferred shares |
– |
181,411 |
Common shares |
505,876 |
471,014 |
Other equity instruments |
147,440 |
– |
Contributed (deficit) surplus |
(17,374) |
12,795 |
Retained earnings |
2,483,309 |
2,185,480 |
Accumulated other comprehensive income (loss) |
8,555 |
(5,157) |
3,127,806 |
2,845,543 |
|
Non-controlling interests |
10,379 |
– |
Total equity |
3,138,185 |
2,845,543 |
Total liabilities and equity |
53,233,921 |
52,933,454 |
Consolidated statement of income (unaudited)
($000s, except per share amounts) Year/Period ended |
2024 |
2023 |
Interest income: |
||
Loans – Personal |
1,945,011 |
1,410,571 |
Loans – Commercial |
1,019,682 |
860,363 |
Investments |
66,766 |
65,362 |
Other |
108,082 |
70,123 |
3,139,541 |
2,406,419 |
|
Interest expense: |
||
Deposits |
1,490,075 |
1,077,520 |
Securitization liabilities |
522,673 |
402,443 |
Funding facilities |
50,940 |
44,527 |
Other |
25,364 |
43,650 |
2,089,052 |
1,568,140 |
|
Net interest income |
1,050,489 |
838,279 |
Non-interest revenue: |
||
Fees and other income |
81,087 |
46,895 |
Net gains on loans and investments |
20,279 |
34,442 |
Gain on sale and income from retained interests |
89,020 |
56,384 |
Net gains (losses) on securitization activities and derivatives |
14,567 |
(336) |
204,953 |
137,385 |
|
Revenue |
1,255,442 |
975,664 |
Provision for credit losses |
107,013 |
38,856 |
Revenue after provision for credit losses |
1,148,429 |
936,808 |
Non-interest expenses: |
||
Compensation and benefits |
272,346 |
199,752 |
Other |
321,753 |
234,991 |
594,099 |
434,743 |
|
Income before income taxes |
554,330 |
502,065 |
Income taxes: |
||
Current |
134,253 |
84,066 |
Deferred |
18,405 |
46,409 |
152,658 |
130,475 |
|
Net income |
401,672 |
371,590 |
Dividends on preferred shares |
8,140 |
6,998 |
Distribution to LRCN holders |
2,586 |
– |
Net income available to common shareholders and non-controlling interests |
390,946 |
364,592 |
Net income attributable to: |
||
Common shareholders |
389,836 |
364,592 |
Non-controlling interests |
1,110 |
– |
390,946 |
364,592 |
|
Earnings per share: |
||
Basic |
10.19 |
9.67 |
Diluted |
10.11 |
9.59 |
Consolidated statement of comprehensive income (unaudited)
($000s) Year/Period ended |
2024 |
2023 |
Net income |
401,672 |
371,590 |
Other comprehensive income – items that will be reclassified subsequently to income: |
||
Debt instruments at Fair Value through Other Comprehensive Income: |
||
Reclassification of losses from AOCI on sale of investments |
(2,051) |
– |
Net change in unrealized gains (losses) on fair value |
68,127 |
(36,208) |
Reclassification of net (gains) losses to income |
(52,096) |
37,432 |
Other comprehensive income – items that will not be reclassified subsequently to income: |
||
Equity instruments designated at Fair Value through Other Comprehensive Income: |
||
Reclassification of losses from AOCI on sale of investments |
(31,340) |
(10,951) |
Net change in unrealized gains (losses) on fair value |
1,176 |
(34,767) |
Reclassification of net losses to retained earnings |
31,588 |
11,042 |
15,404 |
(33,452) |
|
Income tax (expense) recovery |
(4,063) |
9,210 |
11,341 |
(24,242) |
|
Cash flow hedges: |
||
Net change in unrealized (losses) gains on fair value |
(22,798) |
40,951 |
Reclassification of net gains to income |
(7,377) |
(38,718) |
(30,175) |
2,233 |
|
Income tax recovery (expense) |
8,174 |
(631) |
(22,001) |
1,602 |
|
Total other comprehensive loss |
(10,660) |
(22,640) |
Total comprehensive income |
391,012 |
348,950 |
Total comprehensive income attributable to: |
||
Common shareholders |
389,902 |
348,950 |
Non-controlling interests |
1,110 |
– |
391,012 |
348,950 |
Consolidated statement of changes in shareholders’ equity (unaudited)
($000s) |
2024 |
|||||||||||
Preferred |
Common |
Contributed |
Retained |
Accumulated other comprehensive |
||||||||
Other equity |
Cash |
Financial |
Total |
Attributable |
Non- |
Total |
||||||
Balance, beginning of year |
181,411 |
471,014 |
– |
12,795 |
2,185,480 |
43,618 |
(48,775) |
(5,157) |
2,845,543 |
– |
2,845,543 |
|
Non-controlling interest on acquisition |
– |
– |
– |
– |
– |
– |
– |
– |
– |
10,770 |
10,770 |
|
Net Income |
– |
– |
– |
– |
400,562 |
– |
– |
– |
400,562 |
1,110 |
401,672 |
|
Realized losses on sale of shares, net of tax |
– |
– |
– |
– |
(23,056) |
– |
– |
– |
(23,056) |
– |
(23,056) |
|
Transfer of AOCI losses to retained earnings, net of tax |
– |
– |
– |
– |
– |
– |
22,875 |
22,875 |
22,875 |
– |
22,875 |
|
Transfer of AOCI losses to income, net of tax |
– |
– |
– |
– |
– |
– |
1,497 |
1,497 |
1,497 |
– |
1,497 |
|
Other comprehensive loss, net of tax |
– |
– |
– |
– |
– |
(22,001) |
11,341 |
(10,660) |
(10,660) |
– |
(10,660) |
|
Common shares issued |
– |
11,000 |
– |
– |
– |
– |
– |
– |
11,000 |
– |
11,000 |
|
Exercise of stock options |
– |
20,290 |
– |
– |
– |
– |
– |
– |
20,290 |
– |
20,290 |
|
Redemption of preferred shares |
(181,411) |
– |
– |
– |
(2,371) |
– |
– |
– |
(183,782) |
– |
(183,782) |
|
Limited recourse capital notes issued |
– |
– |
150,000 |
– |
– |
– |
– |
– |
150,000 |
– |
150,000 |
|
Issuance cost, net of tax |
– |
– |
(2,560) |
– |
– |
– |
– |
– |
(2,560) |
– |
(2,560) |
|
Limited recourse capital note distributions, net of tax |
– |
– |
– |
– |
(2,586) |
– |
– |
– |
(2,586) |
– |
(2,586) |
|
Dividends: |
||||||||||||
Preferred shares |
– |
– |
– |
– |
(8,140) |
– |
– |
– |
(8,140) |
– |
(8,140) |
|
Common shares |
– |
– |
– |
– |
(66,580) |
– |
– |
– |
(66,580) |
(1,501) |
(68,081) |
|
Share tender rights |
– |
– |
– |
(30,613) |
– |
– |
– |
– |
(30,613) |
– |
(30,613) |
|
Stock-based compensation |
– |
– |
– |
4,016 |
– |
– |
– |
– |
4,016 |
– |
4,016 |
|
Transfer relating to the exercise of stock options |
– |
3,572 |
– |
(3,572) |
– |
– |
– |
– |
– |
– |
– |
|
Balance, end of year |
– |
505,876 |
147,440 |
(17,374) |
2,483,309 |
21,617 |
(13,062) |
8,555 |
3,127,806 |
10,379 |
3,138,185 |
|
($000s) 2023 |
|||||||||||
Preferred |
Common |
Contributed |
Retained |
Accumulated other comprehensive |
|||||||
Cash |
Financial |
Total |
Attributable |
Non- |
Total |
||||||
Balance, beginning of year |
181,411 |
462,561 |
11,445 |
1,870,100 |
42,016 |
(32,578) |
9,438 |
2,534,955 |
– |
2,534,955 |
|
Net Income |
– |
– |
– |
371,590 |
– |
– |
– |
371,590 |
– |
371,590 |
|
Realized losses on sale of shares, net of tax |
– |
– |
– |
(7,722) |
– |
– |
– |
(7,722) |
– |
(7,722) |
|
Transfer of AOCI losses to retained earnings, net of tax |
– |
– |
– |
– |
– |
8,045 |
8,045 |
8,045 |
– |
8,045 |
|
Transfer of AOCI losses to net income, net of tax |
– |
– |
– |
– |
– |
– |
– |
– |
– |
– |
|
Other comprehensive loss, net of tax |
– |
– |
– |
– |
1,602 |
(24,242) |
(22,640) |
(22,640) |
– |
(22,640) |
|
Exercise of stock options |
– |
13,161 |
– |
– |
– |
– |
– |
13,161 |
– |
13,161 |
|
Share Issuance cost, net of tax |
– |
(6,230) |
– |
– |
– |
– |
– |
(6,230) |
– |
(6,230) |
|
Dividends: |
|||||||||||
Preferred shares |
– |
– |
– |
(6,998) |
– |
– |
– |
(6,998) |
– |
(6,998) |
|
Common shares |
– |
– |
– |
(41,490) |
– |
– |
– |
(41,490) |
– |
(41,490) |
|
Stock-based compensation |
– |
– |
2,872 |
– |
– |
– |
– |
2,872 |
– |
2,872 |
|
Transfer relating to the exercise of stock options |
– |
1,522 |
(1,522) |
– |
– |
– |
– |
– |
– |
– |
|
Balance, end of period |
181,411 |
471,014 |
12,795 |
2,185,480 |
43,618 |
(48,775) |
(5,157) |
2,845,543 |
– |
2,845,543 |
Consolidated statement of cash flows (unaudited)
($000s) Year/Period ended |
2024 |
2023 |
CASH FLOWS FROM OPERATING ACTIVITIES |
||
Net income |
401,672 |
371,590 |
Adjustments for non-cash items in net income: |
||
Financial instruments at fair value through income |
13,152 |
45,533 |
Amortization of premiums/discount on investments |
(56,548) |
7,678 |
Amortization of capital and intangible costs |
60,036 |
39,155 |
Provision for credit losses |
107,013 |
38,856 |
Securitization gains |
(66,348) |
(46,948) |
Stock-based compensation |
4,016 |
2,871 |
Dividend income earned, not received |
– |
(28,380) |
Income taxes |
152,658 |
130,475 |
Securitization retained interests |
129,719 |
75,304 |
Changes in operating assets and liabilities: |
||
Restricted cash |
(204,792) |
(29,539) |
Securities purchased under reverse repurchase agreements |
(351,285) |
(708,401) |
Loans receivable, net of securitizations |
(89,825) |
(1,126,698) |
Other assets |
(53,917) |
(57,566) |
Deposits |
1,614,275 |
865,734 |
Securitization liabilities |
81,156 |
(519,066) |
Obligations under repurchase agreements |
(1,128,238) |
462,931 |
Funding facilities |
(784,631) |
491,883 |
Other liabilities |
8,314 |
108,201 |
Income taxes paid |
(98,042) |
(90,318) |
Cash flows (used in) from operating activities |
(278,243) |
33,295 |
CASH FLOWS FROM FINANCING ACTIVITIES |
||
Proceeds from issuance of common shares |
31,290 |
6,931 |
Redemption of preferred shares |
(183,782) |
– |
Net proceeds from issuance of limited recourse notes |
147,440 |
– |
Distributions to other equity holders |
(2,586) |
– |
Dividends paid on preferred shares |
(8,140) |
(6,998) |
Dividends paid on common shares |
(66,580) |
(41,490) |
Cash flows used in financing activities |
(82,358) |
(41,557) |
CASH FLOWS FROM INVESTING ACTIVITIES |
||
Purchase of investments |
(401,650) |
(989,055) |
Proceeds on sale or redemption of investments |
921,021 |
1,007,663 |
Acquisition of subsidiary |
(75,483) |
– |
Investment in associate |
(50,000) |
– |
Net change in Canada Housing Trust re-investment accounts |
76,243 |
78,988 |
Purchase of capital assets and system development costs |
(67,363) |
(34,966) |
Cash flows from investing activities |
402,768 |
62,630 |
Net increase in cash and cash equivalents |
42,167 |
54,368 |
Cash and cash equivalents, beginning of year |
549,474 |
495,106 |
Cash and cash equivalents, end of year |
591,641 |
549,474 |
Cash flows from operating activities include: |
||
Supplemental statement of cash flows disclosures |
||
Interest received |
2,922,693 |
2,137,216 |
Interest paid |
(1,747,235) |
(1,221,598) |
Dividends received |
1,944 |
31,243 |
About EQB Inc.
EQB Inc. EQB is a leading digital financial services company with $127 billion in combined assets under management and administration (as at October 31, 2024). It offers banking services through Equitable Bank, a wholly owned subsidiary and Canada’s seventh largest bank by assets, and wealth management through ACM Advisors, a majority owned subsidiary specializing in alternative assets. As Canada’s Challenger Bank™, Equitable Bank has a clear mission to drive change in Canadian banking to enrich people’s lives. It leverages technology to deliver exceptional personal and commercial banking experiences and services to nearly 700,000 customers and more than six million credit union members through its businesses. Through its digital EQ Bank platform (eqbank.ca), its customers have named it one of Canada’s top banks on the Forbes World’s Best Banks list since 2021.
Please visit eqb.investorroom.com for more details.
Investor contact:
Mike Rizvanovic
Managing Director, Investor Relations
investor_enquiry@eqb.com
Media contact:
Maggie Hall
Director, PR & Communications
maggie.hall@eqb.com
Cautionary Note Regarding Forward-Looking Statements
Statements made by EQB in the sections of this news release, in other filings with Canadian securities regulators and in other communications include forward-looking statements within the meaning of applicable securities laws (forward-looking statements). These statements include, but are not limited to, statements about EQB’s objectives, strategies and initiatives, financial performance expectation, statements with respect to EQB’s intention to renew and/or make share repurchases under its NCIB, and other statements made herein, whether with respect to EQB’s businesses or the Canadian economy. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “intends”, “scheduled”, “planned”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases which state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”, or other similar expressions of future or conditional verbs. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, closing of transactions, performance or achievements of EQB to be materially different from those expressed or implied by such forward-looking statements, including but not limited to risks related to capital markets and additional funding requirements, fluctuating interest rates and general economic conditions, legislative and regulatory developments, changes in accounting standards, the nature of our customers and rates of default, and competition as well as those factors discussed under the heading “Risk Management” in EQB’s Q3 MD&A and in EQB’s documents filed on SEDAR at www.sedarplus.ca and in Q4: Supplemental Management Information that is available under the Financials section of EQB’s investor website at eqb.investorroom.com. All material assumptions used in making forward-looking statements are based on management’s knowledge of current business conditions and expectations of future business conditions and trends, including their knowledge of the current credit, interest rate and liquidity conditions affecting EQB and the Canadian economy. Although EQB believes the assumptions used to make such statements are reasonable at this time and has attempted to identify in its continuous disclosure documents important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Certain material assumptions are applied by EQB in making forward-looking statements, including without limitation, assumptions regarding its continued ability to fund its mortgage business, a continuation of the current level of economic uncertainty that affects real estate market conditions, continued acceptance of its products in the marketplace, as well as no material changes in its operating cost structure and the current tax regime. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. EQB does not undertake to update any forward-looking statements that are contained herein, except in accordance with applicable securities laws.
Non-Generally Accepted Accounting Principles (GAAP) Financial Measures and Ratios
In addition to GAAP prescribed measures, this news release references certain non-GAAP measures, including adjusted financial results, that we believe provide useful information to investors regarding EQB’s financial condition and results of operations. Readers are cautioned that non-GAAP measures often do not have any standardized meaning, and therefore, are unlikely to be comparable to similar measures presented by other companies.
Adjustments listed below are presented on a pre-tax basis:
FY 2024
- $8.8 million fair value adjustment on a covered bond maturity,
- $2.2 million new office lease related costs prior to occupancy,
- $11.2 million non-recurring operational effectiveness expenses and acquisition and integration-related costs associated with Concentra and ACM,
- $9.3 million intangible asset amortization,
- $16.1 million provision for credit losses associated with an equipment financing purchase facility, and
- $1.7 million provision for credit losses due to a one-time change in ECL methodology from five to four economic scenarios and adjusting associated weights.
FY 2023
- $28.0 million related to a one-time strategic investment gain,
- $15.1 million acquisition and integration-related costs associated with Concentra and ACM,
- $3.5 million intangible asset amortization,
- $3.3 million net fair value amortization adjustments, and
- $0.9 million other expenses.
The following table presents a reconciliation of GAAP reported financial results to non-GAAP adjusted financial results (unaudited).
Reconciliation of reported and adjusted financial results |
As at or for the quarter ended |
For the year ended |
|||
($000, except share and per share amounts) |
31-Oct-24 |
31-Jul-24 |
31-Oct-23 (fourth months) |
31-Oct-24 |
31-Oct-23 (ten months) |
Reported results |
|||||
Net interest income |
255,774 |
271,367 |
345,783 |
1,050,489 |
838,279 |
Non-interest revenue |
56,998 |
55,871 |
49,503 |
204,953 |
137,385 |
Revenue |
312,772 |
327,238 |
395,286 |
1,255,442 |
975,664 |
Non-interest expense |
153,625 |
150,569 |
181,165 |
594,099 |
434,743 |
Pre-provision pre-tax income(3) |
159,147 |
176,669 |
214,121 |
661,343 |
540,921 |
Provision for credit loss |
47,987 |
21,274 |
19,566 |
107,013 |
38,856 |
Income tax expense |
31,740 |
43,241 |
53,409 |
152,658 |
130,475 |
Net income |
79,420 |
112,154 |
141,146 |
401,672 |
371,590 |
Net income available to common shareholders |
75,382 |
109,538 |
138,797 |
389,836 |
364,592 |
Adjustments |
|||||
Net interest income – covered bond fair value adjustment |
8,804 |
– |
– |
8,804 |
– |
Net interest income – fair value amortization/adjustments |
– |
– |
– |
– |
(4,167) |
Non-interest revenue – strategic investment |
– |
– |
– |
– |
(27,965) |
Non-interest revenue – fair value amortization/adjustments |
– |
– |
– |
– |
941 |
Non-interest expenses – new office lease related costs |
(2,208) |
– |
– |
(2,208) |
– |
Non-interest expenses – non-recurring operational effectiveness |
(755) |
(2,652) |
(6,972) |
(11,171) |
(15,093) |
Non-interest expenses – other expenses |
– |
– |
– |
– |
(858) |
Non-interest expenses – fair value amortization/adjustments |
– |
– |
– |
– |
(66) |
Non-interest expenses – intangible asset amortization |
(2,115) |
(2,223) |
(1,181) |
(9,334) |
(3,542) |
Provision for credit loss – equipment financing |
(16,085) |
– |
– |
(16,085) |
– |
Provision for credit loss – ECL methodology change and weights |
– |
(1,698) |
– |
(1,698) |
– |
Pre-tax adjustments – income before tax |
29,967 |
6,573 |
8,153 |
49,301 |
(11,631) |
Income tax expense – tax impact on above adjustments(2) |
7,988 |
1,543 |
2,264 |
12,997 |
(4,311) |
Post-tax adjustments – net income |
21,979 |
5,030 |
5,889 |
36,303 |
(7,320) |
Adjustments attributed to minority interests |
(288) |
(310) |
– |
(912) |
– |
Post-tax adjustments – net income to common shareholders |
21,691 |
4,720 |
5,889 |
35,391 |
(7,320) |
Adjusted results |
|||||
Net interest income |
264,578 |
271,367 |
345,783 |
1,059,293 |
834,112 |
Non-interest revenue |
56,998 |
55,871 |
49,503 |
204,953 |
110,361 |
Revenue |
321,576 |
327,238 |
395,286 |
1,264,246 |
944,473 |
Non-interest expense |
148,547 |
145,694 |
173,012 |
571,386 |
415,184 |
Pre-provision pre-tax income(3) |
173,029 |
181,544 |
222,274 |
692,860 |
529,289 |
Provision for credit loss |
31,902 |
19,576 |
19,566 |
89,230 |
38,856 |
Income tax expenses |
39,728 |
44,784 |
55,673 |
165,655 |
126,163 |
Net income |
101,399 |
117,184 |
147,035 |
437,975 |
364,270 |
Net income available to common shareholders |
97,073 |
114,258 |
144,686 |
425,227 |
357,272 |
Diluted earnings per share |
|||||
Weighted average diluted common shares outstanding |
38,723,974 |
38,606,268 |
38,117,929 |
38,549,300 |
38,013,724 |
Diluted earnings per share – reported |
1.95 |
2.84 |
3.64 |
10.11 |
9.59 |
Diluted earnings per share – adjusted |
2.51 |
2.96 |
3.80 |
11.03 |
9.40 |
Diluted earnings per share – adjustment impact |
0.56 |
0.12 |
0.16 |
0.92 |
(0.19) |
(1) Includes non-recurring operational effectiveness and acquisition and integration-related costs associated with Concentra Bank and ACM. (2) Income tax expense associated with non-GAAP adjustment was calculated based on the statutory tax rate applicable for that period, taking into account the federal tax rate increase. (3) This is a non-GAAP measure, see Non-GAAP financial measures and ratios section of this document. |
Other non-GAAP financial measures and ratios:
- Adjusted return on equity (ROE) is calculated on an annualized basis and is defined as adjusted net income available to common shareholders as a percentage of weighted average common shareholders’ equity (reported) outstanding during the period.
- Assets under administration (AUA): is sum of (1) assets over which EQB’s subsidiaries have been named as trustee, custodian, executor, administrator, or other similar role; (2) loans held by credit unions for which EQB’s subsidiaries act as servicer.
- Assets under management (AUM): is the sum of total balance sheet assets, loan principal derecognized but still managed by EQB, and assets managed on behalf on investors.
- Loans under management (LUM): is the sum of loan principal reported on the consolidated balance sheet and loan principal derecognized but still managed by EQB.
- Net interest margin (NIM): this profitability measure is calculated on an annualized basis by dividing net interest income by the average total interest earning assets for the period.
- Pre-provision pre-tax income (PPPT): this is the difference between revenue and non-interest expenses.
- Total loan assets: this is calculated on a gross basis (prior to allowance for credit losses) as the sum of both Loans – Personal and Loans – Commercial on the balance sheet and adding their associated allowance for credit losses.
View original content to download multimedia:https://www.prnewswire.com/news-releases/eqb-reports-record-annual-earnings-dividend-increase-and-growth-guidance-302323174.html
SOURCE EQB Inc.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
D2L Inc. Announces Third Quarter 2025 Financial Results
- Subscription and support revenue grew 13% year-over-year to US$46.8 million
- Professional services and other revenue in the quarter increased to US$7.5 million
- Annual Recurring Revenue1 reached US$201.7 million, up 12% over the prior year
- Adjusted EBITDA2 of US$10.4 million and Adjusted EBITDA margin2 of 19.2% margin in the quarter
- Company increases Fiscal 2025 revenue guidance to $204 million to $205 million and increases Adjusted EBITDA guidance to $25.5 million to $26.5M million
TORONTO, Dec. 4, 2024 /CNW/ – D2L Inc. DTOL (“D2L” or the “Company”), a leading global learning technology company, today announced financial results for its Fiscal 2025 third quarter ended October 31, 2024. All amounts are in U.S. dollars and all figures are prepared in accordance with International Financial Reporting Standards (“IFRS”) unless otherwise indicated.
“Our strong third-quarter results were highlighted by healthy growth in subscription revenue and significant margin expansion, driving substantial improvement in our ‘Rule of 40’ performance as we successfully balance growth and market share gains with improving profitability,” said John Baker, CEO of D2L. “We continue to benefit from high win rates in our target markets as we navigate the broader macroeconomic conditions. We’re making disciplined investments that support our goal of long-term market leadership, and have seen strong customer response and pipeline generation from our recently expanded product portfolio, including our AI offering Lumi and Creator+. These new products make learning experiences better and easier to create for our customers, leading to improved learning outcomes and better learner retention.”
Third Quarter Fiscal 2025 Financial Highlights
- Total revenue was $54.3 million, up 18% from the same period in the prior year.
- Subscription and support revenue was $46.8 million, an increase of 13% over the same period of the prior year.
- Professional services and other revenue was $7.5 million, an increase of $2.8 million from the same period of the prior year. During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this revenue, services revenue increased by $1.6 million over the prior year, and total revenue increased by $7.1 million or 15.2% year over year.
- Annual Recurring Revenue1 as at October 31, 2024 increased by 12% or $21.6 million year-over-year, from $180.1 million to $201.7 million.
- Cash flow from operating activities was $11.4 million, compared to $15.3 million in the same period in the prior year, and Free Cash Flow2 was $11.3 million, compared to $14.2 million in the same period in the prior year.
- Cash flow from operating activities for the 9-month period ended October 31, 2024 was $28.0 million, up 32% compared with $21.2 million for the same period in the prior year.
- Gross profit increased 22% to $37.4 million (68.9% gross profit margin) from $30.6 million (66.4% gross profit margin) in the same period of the prior year. Gross profit margin for subscription and support revenue increased to 72.7%, up 140 basis points from 71.3% in the same period of the prior year.
- Adjusted EBITDA2 increased to $10.4 million (19.2% Adjusted EBITDA margin2) from $2.1 million (4.6%) for the same period in the prior year. Excluding the additional services revenue of $1.2 million recognized in the quarter, Adjusted EBITDA and Adjusted EBITDA Margin would have been $9.2 million and 17.4%, respectively, for the three months ended October 31, 2024.
- Income for the period was $5.5 million, compared with a loss of $0.4 million for the comparative period of the prior year.
- Strong balance sheet at quarter end, with cash and cash equivalents of $108.3 million and no debt.
- During the third quarter, the Company repurchased and canceled 68,600 Subordinate Voting Shares under its normal course issuer bid (“NCIB”). The Company has repurchased and cancelled 348,080 shares since the inception of the NCIB on December 8, 2023.
- On December 4, 2024, the Company announced that the Toronto Stock Exchange (the “TSX”) accepted the Company’s notice to launch a new NCIB, commencing on December 9, 2024.
1 Refer to “Key Performance Indicators” section of this press release. |
|
2 A non-IFRS financial measure or non-IFRS ratio. Refer to “Non IFRS Financial Measures” section of this press release. |
Third Quarter Fiscal 2025 Financial Results – Selected Financial Measures
(in thousands of U.S. dollars, except for percentages)
Three months ended October 31 |
Nine months ended October 31 |
||||||||
2024 |
2023 |
Change |
Change |
2024 |
2023 |
Change |
Change |
||
$ |
$ |
$ |
% |
$ |
$ |
$ |
% |
||
Subscription & Support Revenue |
46,752 |
41,450 |
5,302 |
12.8 % |
133,723 |
120,045 |
13,678 |
11.4 % |
|
Professional Services & Other Revenue |
7,547 |
4,663 |
2,884 |
61.8 % |
18,240 |
14,766 |
3,474 |
23.5 % |
|
Total Revenue |
54,299 |
46,113 |
8,186 |
17.8 % |
151,963 |
134,811 |
17,152 |
12.7 % |
|
Constant Currency Revenue1 |
54,106 |
46,113 |
7,993 |
17.3 % |
152,126 |
134,811 |
17,315 |
12.8 % |
|
Gross Profit |
37,390 |
30,600 |
6,790 |
22.2 % |
103,441 |
90,161 |
13,280 |
14.7 % |
|
Adjusted Gross Profit 1 |
37,964 |
30,778 |
7,186 |
23.3 % |
104,439 |
90,622 |
13,817 |
15.2 % |
|
Adjusted Gross Margin1 |
69.9 % |
66.7 % |
68.7 % |
67.2 % |
|||||
Income (Loss) for the period |
5,547 |
(387) |
5,934 |
1,533.3 % |
5,857 |
(4,105) |
9,962 |
242.7 % |
|
Adjusted EBITDA1 |
10,420 |
2,122 |
8,298 |
391.0 % |
18,652 |
4,399 |
14,253 |
324.0 % |
|
Cash Flows From Operating Activities |
11,420 |
15,318 |
(3,898) |
(25.5 %) |
28,037 |
21,171 |
6,866 |
32.4 % |
|
Free Cash Flow1 |
11,296 |
14,244 |
(2,948) |
(20.7 %) |
27,567 |
16,009 |
11,558 |
72.2 % |
1 A non-IFRS financial measure or non-IFRS ratio. Refer to the “Non-IFRS Financial Measures and Reconciliation of Non-IFRS Financial Measures” section of this press release for more details. |
Third Quarter Business & Operating Highlights
- D2L continued to grow its customer base in education in North America, including the additions of the Cincinnati State Technical and Community College, University of the Fraser Valley, and Prairie View A&M University.
- D2L continued to expand its international customer base, including XP Educação in Brazil and the main statutory body overseeing legal education and training in New Zealand.
- Signed new corporate customers, including Becoming Institute and the premier academic trauma surgery organization in the United States.
- Launched Creator+ natively integrated with H5P Group AS (“H5P”), offering an all-in-one solution for creating engaging courses with interactive content, video tools, dynamic analytics, and generative AI. Early adopters include the University of Hawaiʻi System.
- The Tambellini Group, the leading analyst and advisory firm focused on higher education, ranked D2L Brightspace highest among competitors for usability and innovation in the inaugural Tambellini StarChart™ 2024 for Learning Management Systems (“LMS”) in higher education.
- Named a winner in the 2024 LMS Top 20 Company by Training Industry and a winner in the 2024 Learning Systems Awards for Best Enterprise LMS by Talented Learning.
- D2L Lumi was named a winner of the Tech & Learning Awards of Excellence: Back to School 2024 in the Primary and Higher Education categories.
- Announced a strategic partnership with Seesaw, the leading elementary Learning Experience Platform to enhance the K-12 digital learning experience.
Financial Outlook
D2L updated its previously issued financial guidance for the year ended January 31, 2025 (“Fiscal 2025”) as follows:
- Subscription and support revenue in the range of $180 million to $181 million, implying growth of 11% at the midpoint over Fiscal 2024, an increase from previously issued guidance of $178 million to $181 million;
- Total revenue in the range of $204 million to $205 million, implying growth of 12% at the midpoint over Fiscal 2024, an increase from previously issued guidance of $199 million to $202 million; and
- Adjusted EBITDA in the range of $25.5 million to $26.5 million, implying Adjusted EBITDA margin of 13% at the midpoint, an increase from previously issued guidance of $22 million to $24 million.
These guidance revisions reflect the Company’s continued progress in balancing revenue growth with operating efficiency improvements.
For additional details on the Company’s outlook, including the principal underlying assumptions and risk factors regarding achievement, refer to the “Financial Outlook” section of the Company’s Management’s Discussion and Analysis for the three and 12 months ended January 31, 2024 (the “Annual MD&A”), as well as the “Forward-Looking Information” section therein, below and in the Company’s Management’s Discussion and Analysis for the three months ended October 31, 2024 (the “Interim MD&A”).
Conference Call & Webcast
D2L management will host a conference call on Thursday, December 5, 2024 at 8:30 am ET to discuss its third quarter Fiscal 2025 financial results.
Date: |
Thursday, December 5, 2024 |
|
Time: |
8:30 am (ET) |
|
Dial in number: |
Canada/US: 1 (833) 470-1428 International: 1 (404) 975-4839 Access code: 027545 |
|
Webcast: |
A live webcast will be available at ir.d2l.com/events-and-presentations/events/ The webcast will also be archived |
Forward-Looking Information
This press release includes statements containing “forward-looking information” within the meaning of applicable securities laws. In some cases, forward-looking information can be identified by the use of forward-looking terminology such as “plans”, “expects”, “budget”, “scheduled”, “estimates”, “outlook”, “target”, “forecasts”, “projection”, “potential”, “prospects”, “strategy”, “intends”, “anticipates”, “seek”, “believes”, “opportunity”, “guidance”, “aim”, “goal” or variations of such words and phrases or statements that certain future conditions, actions, events or results “may”, “could”, “would”, “should”, “might”, “will”, “can”, or negative versions thereof, “be taken”, “occur”, “continue” or “be achieved”, and other similar expressions. Statements containing forward-looking information are not historical facts, but instead represent management’s expectations, estimates and projections regarding future events or circumstances.
This forward-looking information relates to the Company’s future financial outlook and anticipated events or results and includes, but is not limited to, statements under the heading “Financial Outlook” and information regarding: the Company’s financial position, financial results, business strategy, performance, achievements, prospects, objectives, opportunities, business plans and growth strategies, including the Company’s balance growth and profitability plan; the Company’s budgets, operations and taxes; judgments and estimates impacting the financial statements; the markets in which the Company operates; industry trends and the Company’s competitive position; and expansion of the Company’s product offerings, including the impact of AI offerings on the Company’s addressable market and revenue opportunity.
Forward-looking information is based on certain assumptions, expectations and projections, and analyses made by the Company in light of management’s experience and perception of historical trends, current conditions and expected future developments and other factors it believes are appropriate, including the following: the Company’s ability to win business from new customers and expand business from existing customers; the timing of new customer wins and expansion decisions by existing customers; the Company’s ability to generate revenue and expand its business while controlling costs and expenses; the Company’s ability to manage growth effectively; the Company’s ability to hire and retain personnel effectively; the effects of foreign currency exchange rate fluctuations on our operations; the ability to seek out, enter into and successfully integrate acquisitions, including the acquisition of H5P; business and industry trends, including the success of current and future product development initiatives; positive social development and attitudes toward the pursuit of higher education; the Company’s ability to maintain positive relationships with its customer base and strategic partners; the Company’s ability to adapt and develop solutions that keep pace with continuing changes in technology, education and customer needs; the ability to patent new technologies and protect intellectual property rights; the Company’s ability to comply with security, cybersecurity and accessibility laws, regulations and standards; the assumptions underlying the judgments and estimates impacting on financial statements; and the Company’s ability to retain key personnel; the factors and assumptions discussed under the “Financial Outlook” section of the Annual MD&A, and that the list of factors referenced in the following paragraph, collectively, do not have a material impact on the Company.
Although the Company believes that the assumptions underlying such forward-looking information were reasonable when made, they are inherently uncertain and are subject to significant risks and uncertainties and may prove to be incorrect. The Company cautions investors that forward-looking information is not a guarantee of the future and that actual results may differ materially from those made in or suggested by the forward-looking information contained in this press release. Whether actual results, performance or achievements will conform to the Company’s expectations and predictions is subject to a number of known and unknown risks, uncertainties and other factors, including but not limited to the risks identified herein, or at “Summary of Factors Affecting Our Performance” of the Company’s Interim MD&A or in the “Risk Factors” section of the Company’s most recently filed annual information form, in each case filed under the Company’s profile on SEDAR+ at www.sedarplus.com. If any of these risks or uncertainties materialize, or if assumptions underlying the forward-looking information prove incorrect, actual results might vary materially from those anticipated in the forward-looking information.
Given these risks and uncertainties, investors are cautioned not to place undue reliance on forward-looking information, including any financial outlook. Any forward-looking information that is contained in this press release speaks only as of the date of such statement, and the Company undertakes no obligation to update any forward-looking information or to publicly announce the results of any revisions to any of those statements to reflect future events or developments, except as required by applicable securities laws. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data.
About D2L Inc. DTOL
D2L is transforming the way the world learns, helping learners achieve more than they dreamed possible. Working closely with customers all over the world, D2L is on a mission to make learning more inspiring, engaging and human. Find out how D2L helps transform lives and delivers outstanding learning outcomes in K-12, higher education and business at www.D2L.com.
D2L Inc.
Condensed Consolidated Interim Statements of Financial Position
(In U.S. dollars)
As at October 31, 2024 and January 31, 2024
(Unaudited)
October 31, 2024 |
January 31, 2024 |
||
Assets |
|||
Current assets: |
|||
Cash and cash equivalents |
$ 108,252,331 |
$ 116,943,499 |
|
Trade and other receivables |
20,379,489 |
23,025,690 |
|
Uninvoiced revenue |
3,896,203 |
3,971,861 |
|
Prepaid expenses |
6,559,188 |
10,517,226 |
|
Deferred commissions |
5,134,323 |
5,334,864 |
|
144,221,534 |
159,793,140 |
||
Non-current assets: |
|||
Other receivables |
480,621 |
537,056 |
|
Prepaid expenses |
381,939 |
119,872 |
|
Deferred income taxes |
573,268 |
529,674 |
|
Right-of-use assets |
8,127,082 |
8,774,960 |
|
Property and equipment |
7,402,295 |
8,427,734 |
|
Deferred commissions |
7,449,801 |
7,730,724 |
|
Investment in associate |
21,248 |
— |
|
Loan receivable from associate |
5,120,885 |
— |
|
Intangible assets |
18,073,003 |
770,707 |
|
Goodwill |
26,379,860 |
10,440,091 |
|
Total assets |
$ 218,231,536 |
$ 197,123,958 |
|
Liabilities and Shareholders’ Equity |
|||
Current liabilities: |
|||
Accounts payable and accrued liabilities |
$ 28,615,437 |
$ 32,635,926 |
|
Deferred revenue |
105,842,166 |
93,727,368 |
|
Lease liabilities |
1,396,079 |
1,002,464 |
|
Contingent consideration |
4,893,539 |
271,479 |
|
140,747,221 |
127,637,237 |
||
Non-current liabilities: |
|||
Deferred income taxes |
4,119,188 |
587,075 |
|
Lease liabilities |
10,660,223 |
11,707,534 |
|
Contingent consideration |
— |
311,839 |
|
14,779,411 |
12,606,448 |
||
155,526,632 |
140,243,685 |
||
Shareholders’ equity: |
|||
Share capital |
367,288,877 |
364,830,884 |
|
Additional paid-in capital |
48,190,065 |
47,485,107 |
|
Accumulated other comprehensive loss |
(7,333,643) |
(4,998,317) |
|
Deficit |
(345,440,395) |
(350,437,401) |
|
62,704,904 |
56,880,273 |
||
Related party transactions Subsequent event |
|||
Total liabilities and shareholders’ equity |
$ 218,231,536 |
$ 197,123,958 |
D2L INC.
Condensed Consolidated Interim Statements of Comprehensive Income (Loss)
(In U.S. dollars)
For the three and nine months ended October 31, 2024 and 2023
(Unaudited)
Three months ended October 31 |
Nine months ended October 31 |
||||
2024 |
2023 |
2024 |
2023 |
||
Revenue: |
|||||
Subscription and support |
$ 46,751,998 |
$ 41,449,926 |
$ 133,723,027 |
$ 120,045,266 |
|
Professional service and other |
7,547,470 |
4,662,769 |
18,239,685 |
14,765,509 |
|
54,299,468 |
46,112,695 |
151,962,712 |
134,810,775 |
||
Cost of revenue: |
|||||
Subscription and support |
12,777,133 |
11,884,640 |
36,651,859 |
33,977,839 |
|
Professional services and other |
4,132,232 |
3,627,638 |
11,870,394 |
10,671,456 |
|
16,909,365 |
15,512,278 |
48,522,253 |
44,649,295 |
||
Gross profit |
37,390,103 |
30,600,417 |
103,440,459 |
90,161,480 |
|
Expenses: |
|||||
Sales and marketing |
12,806,266 |
12,807,855 |
40,302,476 |
40,209,601 |
|
Research and development |
11,139,920 |
12,351,201 |
35,294,478 |
36,015,722 |
|
General and administrative |
8,651,729 |
7,102,165 |
25,231,988 |
20,603,875 |
|
32,597,915 |
32,261,221 |
100,828,942 |
96,829,198 |
||
Income (loss) from operations |
4,792,188 |
(1,660,804) |
2,611,517 |
(6,667,718) |
|
Interest and other income (expense): |
|||||
Interest expense |
(235,892) |
(157,582) |
(550,438) |
(456,456) |
|
Interest income |
870,355 |
1,221,704 |
2,899,093 |
2,938,216 |
|
Other income (expense) |
(122,043) |
(10,355) |
(122,000) |
4,897 |
|
Gain on SkillsWave disposal transaction |
— |
— |
917,395 |
— |
|
Foreign exchange gain |
224,145 |
314,938 |
307,859 |
380,417 |
|
736,565 |
1,368,705 |
3,451,909 |
2,867,074 |
||
Income (loss) before income taxes |
5,528,753 |
(292,099) |
6,063,426 |
(3,800,644) |
|
Income taxes (recovery): |
|||||
Current |
246,162 |
43,883 |
602,830 |
435,294 |
|
Deferred |
(264,457) |
51,613 |
(396,134) |
(130,838) |
|
(18,295) |
95,496 |
206,696 |
304,456 |
||
Income (loss) for the period |
5,547,048 |
(387,595) |
5,856,730 |
(4,105,100) |
|
Other comprehensive gain (loss): |
|||||
Foreign currency translation gain (loss) |
137,532 |
(1,556,171) |
(2,335,326) |
(1,020,872) |
|
Comprehensive income (loss) |
$ 5,684,580 |
$ (1,943,766) |
$ 3,521,404 |
$ (5,125,972) |
|
Earnings (loss) per share – basic |
$ 0.10 |
$ (0.01) |
$ 0.11 |
$ (0.08) |
|
Earnings (loss) per share – diluted |
$ 0.10 |
$ (0.01) |
$ 0.10 |
$ (0.08) |
|
Weighted average number of common shares |
54,453,244 |
53,703,768 |
54,282,281 |
53,454,498 |
|
Weighted average number of common shares |
56,032,694 |
53,703,768 |
55,828,067 |
53,454,498 |
D2L INC.
Condensed Consolidated Interim Statements of Shareholders’ Equity
(In U.S. dollars)
For the nine months ended October 31, 2024 and 2023
(Unaudited)
Share Capital |
Additional |
Accumulated |
Deficit |
Total |
||
Shares |
Amount |
|||||
Balance, January 31, 2024 |
53,978,085 |
$ 364,830,884 |
$ 47,485,107 |
$ (4,998,317) |
$ (350,437,401) |
$ 56,880,273 |
Issuance of Subordinate Voting Shares on |
410,397 |
3,443,979 |
(1,804,429) |
— |
— |
1,639,550 |
Issuance of Subordinate Voting Shares on |
374,307 |
1,416,155 |
(4,602,395) |
— |
— |
(3,186,240) |
Stock-based compensation |
— |
— |
7,111,782 |
— |
— |
7,111,782 |
Repurchase of share capital for |
(306,880) |
(2,402,141) |
— |
— |
— |
(2,402,141) |
Change in share repurchase commitment |
— |
— |
— |
— |
(859,724) |
(859,724) |
Other comprehensive loss |
— |
— |
— |
(2,335,326) |
— |
(2,335,326) |
Income for the period |
— |
— |
— |
— |
5,856,730 |
5,856,730 |
Balance, October 31, 2024 |
54,455,909 |
$ 367,288,877 |
$ 48,190,065 |
$ (7,333,643) |
$ (345,440,395) |
$ 62,704,904 |
Balance, January 31, 2023 |
53,146,530 |
357,639,824 |
46,084,161 |
(5,001,805) |
(344,630,902) |
54,091,278 |
Issuance of Subordinate Voting Shares on |
381,794 |
3,414,019 |
(1,443,627) |
— |
— |
1,970,392 |
Issuance of Subordinate Voting Shares on |
218,010 |
988,410 |
(2,474,669) |
— |
— |
(1,486,259) |
Stock-based compensation |
— |
— |
7,237,274 |
— |
— |
7,237,274 |
Other comprehensive loss |
— |
— |
— |
(1,020,872) |
— |
(1,020,872) |
Loss for the period |
— |
— |
— |
— |
(4,105,100) |
(4,105,100) |
Balance, October 31, 2023 |
53,746,334 |
$ 362,042,253 |
$ 49,403,139 |
$ (6,022,677) |
$ (348,736,002) |
$ 56,686,713 |
D2L INC.
Condensed Consolidated Interim Statements of Cash Flows
(In U.S. dollars)
For the nine months ended October 31, 2024 and 2023
(Unaudited)
2024 |
2023 |
|||
Operating activities: |
||||
Income (loss) for the period |
$ 5,856,730 |
$ (4,105,100) |
||
Items not involving cash: |
||||
Depreciation of property and equipment |
1,285,970 |
1,158,782 |
||
Depreciation of right-of-use assets |
945,223 |
927,605 |
||
Amortization of intangible assets |
723,100 |
60,159 |
||
Gain on disposal of property and equipment |
(51,476) |
(16,194) |
||
Stock-based compensation |
7,111,782 |
7,237,274 |
||
Net interest income |
(2,348,655) |
(2,481,760) |
||
Income tax expense |
206,696 |
304,456 |
||
Gain on SkillsWave disposal transaction |
(917,395) |
— |
||
Loss from equity accounted investee |
416,850 |
— |
||
Fair value gain on loan receivable from associate |
(120,885) |
— |
||
Changes in operating assets and liabilities: |
||||
Trade and other receivables |
3,784,969 |
1,041,252 |
||
Uninvoiced revenue |
(37,023) |
(440,936) |
||
Prepaid expenses |
3,503,610 |
1,073,501 |
||
Deferred commissions |
296,245 |
(1,105,606) |
||
Accounts payable and accrued liabilities |
(6,410,785) |
1,952,832 |
||
Deferred revenue |
11,573,770 |
13,243,128 |
||
Right-of-use assets and lease liabilities |
(44,962) |
(57,530) |
||
Interest received |
2,878,878 |
2,938,216 |
||
Interest paid |
(19,343) |
(9,815) |
||
Income taxes paid |
(596,646) |
(549,475) |
||
Cash flows from operating activities |
28,036,653 |
21,170,789 |
||
Financing activities: |
||||
Payment of lease liabilities |
(1,344,625) |
(575,023) |
||
Lease incentive received |
103,128 |
935,025 |
||
Proceeds from exercise of stock options |
1,639,550 |
1,970,392 |
||
Taxes paid on settlement of restricted share units |
(3,186,240) |
(1,486,259) |
||
Repurchase of share capital for cancellation under NCIB |
(2,402,141) |
— |
||
Cash flows (used in) from financing activities |
(5,190,328) |
844,135 |
||
Investing activities: |
||||
Purchase of property and equipment |
(521,775) |
(5,178,461) |
||
Proceeds from disposal of property and equipment |
51,476 |
16,537 |
||
Acquisition of business, net of cash acquired |
(22,308,927) |
(2,793,180) |
||
Payment of contingent consideration |
(249,436) |
— |
||
Transfer of cash on disposal of SkillsWave |
(1,483,357) |
— |
||
Proceeds from sale of majority ownership stake in SkillsWave |
809,038 |
— |
||
Issuance of loan to SkillsWave |
(5,000,000) |
— |
||
Cash flows used in investing activities |
(28,702,981) |
(7,955,104) |
||
Effect of exchange rate changes on cash and cash equivalents |
(2,834,512) |
(1,701,358) |
||
(Decrease) increase in cash and cash equivalents |
(8,691,168) |
12,358,462 |
||
Cash and cash equivalents, beginning of period |
116,943,499 |
110,732,236 |
||
Cash and cash equivalents, end of period |
$ 108,252,331 |
$ 123,090,698 |
Non-IFRS Financial Measures and Reconciliation of Non-IFRS Financial Measures
The information presented within this press release refers to certain non-IFRS financial measures (including non-IFRS ratios) including Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Gross Profit, Adjusted Gross Margin, Free Cash Flow, Free Cash Flow Margin, and Constant Currency Revenue. These measures are not recognized measures under IFRS and do not have a standardized meaning prescribed by IFRS. Non-IFRS financial measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS and are unlikely to be comparable to similar measures presented by other issuers. Rather, these measures are provided as additional information to complement those IFRS measures by providing further understanding of the Company’s results of operations, financial performance and liquidity from management’s perspective and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS measures. The Company believes that securities analysts, investors and other interested parties frequently use non-IFRS financial measures in the evaluation of the Company. The Company’s management also uses non-IFRS financial measures to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts, and to assess our ability to meet our capital expenditures and working capital requirements.
Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA is defined as net income (loss), excluding interest, taxes, depreciation and amortization (or EBITDA), adjusted for stock-based compensation, foreign exchange gains and losses, non-recurring expenses, transaction-related costs, fair value adjustment of acquired deferred revenue, income (loss) from equity accounted investee, change in fair value on the loan receivable from associate, impairment charges and other income and losses. Adjusted EBITDA Margin is calculated as Adjusted EBITDA expressed as a percentage of total revenue. For an explanation of recent changes to and management’s use of Adjusted EBITDA and Adjusted EBITDA Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted EBITDA and Adjusted EBITDA Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.
The following table reconciles Adjusted EBITDA to income (loss) for the period, and discloses Adjusted EBITDA Margin, for the periods indicated:
(in thousands of U.S. dollars, except for percentages) |
Three months ended October 31 |
Nine months ended October 31 |
||
2024 |
2023 |
2024 |
2023 |
|
Income (loss) for the period |
5,547 |
(387) |
5,857 |
(4,105) |
Stock-based compensation |
2,195 |
2,068 |
7,112 |
7,237 |
Foreign exchange gains |
(224) |
(315) |
(308) |
(380) |
Non-recurring expenses(1) |
305 |
807 |
2,171 |
957 |
Transaction-related costs(2) |
1,249 |
169 |
2,072 |
721 |
Fair value adjustment of acquired deferred revenue |
500 |
— |
639 |
— |
Change in fair value on loan receivable from |
(121) |
— |
(121) |
— |
Loss from equity accounted investee |
320 |
— |
417 |
— |
Net interest income |
(634) |
(1,064) |
(2,348) |
(2,482) |
Income tax (recovery) expense |
(18) |
95 |
207 |
304 |
Depreciation and amortization |
1,301 |
749 |
2,954 |
2,147 |
Adjusted EBITDA |
10,420 |
2,122 |
18,652 |
4,399 |
Adjusted EBITDA Margin |
19.2 % |
4.6 % |
12.3 % |
3.3 % |
During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this increase, the Company’s Adjusted EBITDA and Adjusted EBITDA Margin would have been $9.2 million and 17.4%, respectively, for the three months ended October 31, 2024.
Notes: |
||
(1) |
These expenses relate to non-recurring activities, such as certain legal fees incurred that are not indicative of continuing operations, and changes of workforce or technology whereby certain functions were realigned to optimize operations. |
|
(2) |
These expenses include certain legal and professional fees that were incurred in connection with acquisition and other strategic transactions, including the disposal of our majority ownership stake in SkillsWave Corporation (“Skillswave”) and our acquisition of H5P. These expenses also include post-combination compensation costs from the acquisition of H5P. These expenses are net of a gain of $0.9 million recognized on the disposal of our majority ownership stake in SkillsWave. These expenses would not have been incurred if not for these transactions and are not considered expenses indicative of the Company’s continuing operations. |
Adjusted Gross Profit and Adjusted Gross Margin
Adjusted Gross Profit is defined as gross profit excluding related stock-based compensation expenses and amortization from recently acquired intangible assets, specifically acquired technology. Adjusted Gross Margin is calculated as Adjusted Gross Profit expressed as a percentage of total revenue. For an explanation of management’s use of Adjusted Gross Profit and Adjusted Gross Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Adjusted Gross Profit and Adjusted Gross Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.
The following table reconciles Adjusted Gross Margin to gross profit expressed as a percentage of revenue, for the periods indicated:
(in thousands of U.S. dollars, except for |
Three months ended October 31 |
Nine months ended October 31 |
||
2024 |
2023 |
2024 |
2023 |
|
Gross profit for the period |
37,390 |
30,600 |
103,441 |
90,161 |
Stock-based compensation |
147 |
147 |
442 |
430 |
Acquired intangible asset amortization |
427 |
31 |
556 |
31 |
Adjusted Gross Profit |
37,964 |
30,778 |
104,439 |
90,622 |
Adjusted Gross Margin |
69.9 % |
66.7 % |
68.7 % |
67.2 % |
During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this revenue, the Company’s Adjusted Gross Profit and Adjusted Gross Margin would have been $36.8 million and 69.2% respectively, for the three months ended October 31, 2024.
Free Cash Flow and Free Cash Flow Margin
Free Cash Flow is defined as cash provided by (used in) operating activities less net additions to property and equipment. Free Cash Flow Margin is calculated as Free Cash Flow expressed as a percentage of total revenue. For an explanation of management’s use of Free Cash Flow and Free Cash Flow Margin see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Free Cash Flow and Free Cash Flow Margin” section in the Company’s Interim MD&A, which section is incorporated by reference herein.
The following table reconciles our cash flow from (used in) operating activities to Free Cash Flow, and discloses Free Cash Flow Margin, for the periods indicated:
(in thousands of U.S. dollars, except for |
Three months ended October 31 |
Nine months ended October 31 |
||
2024 |
2023 |
2024 |
2023 |
|
Cash flow from operating activities |
11,420 |
15,318 |
28,037 |
21,171 |
Net addition to property and equipment |
(124) |
(1,074) |
(470) |
(5,162) |
Free Cash Flow |
11,296 |
14,244 |
27,567 |
16,009 |
Free Cash Flow Margin |
20.8 % |
30.9 % |
18.1 % |
11.9 % |
Constant Currency Revenue
Constant Currency Revenue is defined as foreign-currency-denominated revenues translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional currency. For an explanation of management’s use of Constant Currency Revenue see “Non-IFRS and Other Financial Measures – Non-IFRS Financial Measures and Non-IFRS Financial Ratios – Constant Currency Revenue” section in the Company’s Interim MD&A, which section is incorporated by reference herein.
The following table reconciles our Constant Currency Revenue to revenue, for the periods indicated:
Three months ended October 31 |
Nine months ended October 31 |
|||
(in thousands of U.S. dollars) |
2024 |
2023 |
2024 |
2023 |
$ |
$ |
$ |
$ |
|
Total revenue for the period |
54,299 |
46,113 |
151,963 |
134,811 |
(Positive) negative impact of foreign exchange rate |
(193) |
— |
163 |
— |
Constant Currency Revenue |
54,106 |
46,113 |
152,126 |
134,811 |
During the current quarter, the Company recognized services revenue of $1.2 million from re-evaluating the completion progress of certain professional services engagements. Excluding this increase, the Company’s constant currency revenue would have been $52.9 million for the three months ended October 31, 2024.
Key Performance Indicators
Management uses a number of metrics, including the key performance indicators identified below, to help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. Our key performance indicators may be calculated in a manner different than similar key performance indicators used by other issuers. These metrics are estimated operating metrics and not projections, nor actual financial results, and are not indicative of current or future performance.
Annual Recurring Revenue and Constant Currency Annual Recurring Revenue: We define Annual Recurring Revenue as the annualized equivalent value of subscription revenue from all existing customer contracts as at the date being measured, exclusive of the implementation period. Our calculation of Annual Recurring Revenue assumes that customers will renew their contractual commitments as those commitments come up for renewal. We believe Annual Recurring Revenue provides a reasonable, real-time measure of performance in a subscription-based environment and provides us with visibility for potential growth to our cash flows. We believe that increasing Annual Recurring Revenue indicates the continued strength in the expansion of our business, and will continue to be our focus on a go-forward basis. We define Constant Currency Annual Recurring Revenue as foreign-currency-denominated Annual Recurring Revenue translated at the historical exchange rates from the comparable prior period into our U.S. dollar functional currency.
As at October 31 |
|||
(in millions of U.S. dollars, except percentages) |
2024 |
2023 |
Change |
$ |
$ |
% |
|
Annual Recurring Revenue |
201.7 |
180.1 |
12.0 % |
Constant Currency Annual Recurring Revenue |
200.7 |
180.1 |
11.4 % |
SOURCE D2L Inc.
View original content to download multimedia: http://www.newswire.ca/en/releases/archive/December2024/04/c9449.html
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The Marketing Alliance Announces Financial Results for Quarter Ended September 30, 2024
ST. LOUIS, Dec. 04, 2024 (GLOBE NEWSWIRE) — The Marketing Alliance, Inc. MAAL (“TMA” or the “Company”), announced its financial results today for its fiscal 2025 second quarter ended September 30, 2024.
Fiscal Q2 2025 Financial Key Items (all comparisons to the prior year period)
- Revenues were $4,928,950 compared to $4,891,830. The increase was primarily due to 10% revenue growth in the insurance distribution business that was offset by a decline in construction revenue
- Operating income from continuing operations of $486,639 compared to $591,187 in the prior year period
- Net income was $401,511 or $0.05 per share compared to $236,599 or $.03 per share in the prior year period
- Subsequent to the end of the quarter, on October 28, the Company announced its Board of Directors had authorized a share repurchase program to repurchase up to 800,000 shares of issued and outstanding common stock and decided to discontinue paying dividends effective immediately
Management Comments
Timothy M. Klusas, TMA’s Chief Executive Officer, commented, “While our bottom-line results were similar to the second fiscal quarter last year, this quarter showed a 10% revenue increase in the insurance distribution business. The investments in the business we made, and continue to make, appeared to begin to result in growth. During this quarter the Company filled two key open leadership roles, introduced a new logo to reflect a more modern customer-centric company, and integrated new tools and technologies on to our insurance distribution platform for customers to save time, save expense, and in turn drive better outcomes for their customers. In the construction business we completed a large job that was initiated in the prior fiscal year. We continued to maintain a very disciplined approach to only undertaking jobs that were economically profitable with respect to our capabilities. We continued to believe this approach positions us to perform better and have capacity to undertake more suitable jobs.”
Mr. Klusas added, “Our general and administrative operating expenses increased this quarter due to a one-time $147,720 non-cash compensation expense. While we have worked very hard to reduce our expenses, we recognized that we may have to adjust these expenses to continue to perform at a high level. We continued to reduce debt and further strengthened our balance sheet by changing our position on dividends.”
On October 28 the Company announced its approval of a share repurchase authorization and its decision to discontinue the dividend. At the time, Timothy Klusas, the Company’s President and Chief Executive Officer, stated, “The share repurchase authorization represents our financial strength and commitment to enhance shareholder value, and the Board’s willingness to change tactics to do so. The Board recognized, nor did it take lightly, that this action would be a significant change in our shareholder distribution strategy of paying dividends, which the Company has paid consistently since its founding in 1996. The Board arrived at this decision after monitoring the stock price while paying dividends and has concluded in its judgement that its dividend policy was not adequately reflected in the stock price.” As of November 27, the Company has repurchased approximately 62,000 shares under this authorization.
Fiscal Second Quarter 2025 Financial Review
- Revenues were $4,928,950 compared to $4,891,830, due to 10% growth in the insurance distribution business that was offset by a decrease in the construction business.
- Net operating revenue (gross profit) for the quarter was $1,367,731, compared to net operating revenue of $1,427,796 in the prior year fiscal period. While Net operating revenue was greater this quarter in the insurance business, it was offset by a decrease in the construction business versus the prior year quarter.
- Operating expenses increased to $881,092 compared to $836,609 for the prior year. The increase was due to a one-time non-cash expense of $147,720.
- The Company reported operating income from continuing operations of $486,639 compared to $591,187 in the prior year period, with differences due to factors discussed above.
- Operating EBITDA (excluding investment portfolio income) of $553,396 was less than the prior year quarterly EBITDA of $669,709. A note reconciling operating EBITDA to operating income can be found at the end of this release.
- Investment gain (loss), net (from non-operating investment portfolio) for the quarter was $61,203 as compared with ($129,263) during the same period the previous year. The Company has reduced its holdings of equity securities by 32% at the end of the quarter versus the prior year.
- Net income was $401,511, or $0.05 per share, compared to $236,599 or $0.03 per share.
- Common shares outstanding increased 100,000 pursuant to Director retention plans.
Balance Sheet Information
- TMA’s balance sheet on September 30, 2024, reflected cash and cash equivalents of $1.4 million; working capital of $6.1 million; and shareholders’ equity of $6.4 million; compared to cash and cash equivalents of $1.8 million, working capital of $6.1 million, and shareholders’ equity of $6.5 million as of September 30, 2023.
About The Marketing Alliance, Inc.
Headquartered in St. Louis, MO, TMA provides support to independent insurance brokerage agencies, with a goal of integrating insurance and “insuretech” engagement platforms to provide members value-added services on a more efficient basis than they can achieve individually.
Investor information can be accessed through the shareholder section of TMA’s website at:
http://www.themarketingalliance.com/shareholder-information.
TMA’s common stock is quoted on the OTC Markets (http://www.otcmarkets.com) under the symbol “MAAL”.
Forward Looking Statement
Investors are cautioned that forward-looking statements involve risks and uncertainties that may affect TMA’s business and prospects. Examples of forward-looking statements include, among others, statements we make regarding our expectations of growth based upon our investments in our business, our recently announced stock repurchase program, our plans to reduce expenses, and our ability to undertake more suitable jobs and generate earnings from our construction business. Any forward-looking statements contained in this press release represent our estimates, expectations or intentions only as of the date hereof, or as of such earlier dates as are indicated, and should not be relied upon as representing our views as of any subsequent date. These statements involve a number of risks and uncertainties, including, but not limited to, expectations of the economic environment, material adverse changes in economic conditions in the markets we serve and in the general economy; the ways that insurance carriers may react in their underwriting policies and procedures to the continuing risks they perceive from public health matters; the ability of our construction business to be engaged for projects and for those projects to commence on the anticipated timetable and with the anticipated profitability; our reliance on a limited number of insurance carriers and any potential termination of those relationships or failure to develop new relationships; privacy and cyber security matters and our ability to protect confidential information; future state and federal regulatory actions and conditions in the states in which we conduct our business; our ability to work with carriers on marketing, distribution and product development; pricing and other payment decisions and policies of the carriers in our insurance distribution business, changes in the public securities markets that affect the value of our investment portfolio; and weather and environmental conditions in the areas served by our construction business. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so.
.
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||
Three Months Ended | Six Months Ended | ||||||||||
September 30, | September 30, | ||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Insurance commission and fee revenue | $ | 4,315,325 | $ | 3,915,691 | $ | 8,582,736 | $ | 7,814,835 | |||
Construction revenue | 592,270 | 944,139 | 689,722 | 1,124,941 | |||||||
Other insurance revenue | 21,355 | 32,000 | 42,035 | 61,800 | |||||||
Total revenues | 4,928,950 | 4,891,830 | 9,314,493 | 9,001,576 | |||||||
Insurance distributor related expenses: | |||||||||||
Distributor bonuses and commissions | 2,852,956 | 2,598,684 | 5,874,359 | 5,158,737 | |||||||
Business processing and distributor costs | 446,389 | 339,392 | 837,784 | 633,267 | |||||||
Depreciation | 1,913 | 2,859 | 4,834 | 5,751 | |||||||
3,301,258 | 2,940,935 | 6,716,977 | 5,797,755 | ||||||||
Costs of construction: | |||||||||||
Direct and indirect costs of construction | 197,034 | 461,617 | 328,465 | 615,160 | |||||||
Depreciation | 62,927 | 61,482 | 125,189 | 118,494 | |||||||
259,961 | 523,099 | 453,654 | 733,654 | ||||||||
Total costs of revenues | 3,561,219 | 3,464,034 | 7,170,631 | 6,531,409 | |||||||
Net operating revenue | 1,367,731 | 1,427,796 | 2,143,862 | 2,470,167 | |||||||
Total general and administrative expenses | 881,092 | 836,609 | 1,608,367 | 1,826,789 | |||||||
Operating income from continuing operations | 486,639 | 591,187 | 535,495 | 643,378 | |||||||
Other income (expense): | |||||||||||
Investment gain, net | 61,203 | (129,263) | 23,983 | 22,949 | |||||||
Interest expense | (31,331) | (50,625) | (74,658) | (97,320) | |||||||
Other income | – | – | 4,938 | – | |||||||
Income from continuing operations before provision | 516,511 | 411,299 | 489.758 | 569,007 | |||||||
for income taxes | |||||||||||
Income tax expense | 115,000 | 174,700 | 138,100 | 192,900 | |||||||
Net Income | $ | 401,511 | $ | 236,599 | $ | 351,658 | 376,107 | ||||
Average Shares Outstanding | 8,210,266 | 8,081,266 | 8,210,266 | 8,081,266 | |||||||
Operating Income from continuing operations per Share | $ | 0.06 | $ | 0.07 | $ | 0.07 | $ | 0.08 | |||
Net Income per Share | $ | 0.05 | $ | 0.03 | $ | 0.04 | $ | 0.05 |
CONSOLIDATED BALANCE SHEETS |
||||
Sept 30, | Sept 30, | |||
2024 | 2023 | |||
ASSETS | ||||
CURRENT ASSETS | ||||
Cash and cash equivalents | $ | 1,373,965 | $ | 1,764,444 |
Equity securities | 2,768,917 | 4,054,377 | ||
Restricted cash | 2,098,557 | 613,932 | ||
Accounts receivable | 6,937,248 | 7,091,640 | ||
Current portion of notes receivable | 541,860 | 120,921 | ||
Prepaid expenses and other current assets | 172,557 | 130,159 | ||
Total current assets | 13,893,104 | 13,775,473 | ||
PROPERTY AND EQUIPMENT, net | 762,452 | 965,129 | ||
OTHER ASSETS | ||||
receivable, net due to the allowance | 63,614 | 565,186 | ||
Restricted cash | – | 1,893,097 | ||
Operating lease right-of-use assets | 115,183 | 250,735 | ||
Total other assets | 178,797 | 2,709,018 | ||
$ | 14,834,353 | $ | 17,449,620 | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
CURRENT LIABILITIES | ||||
Accounts payable and accrued expenses | 4,980,015 | 5,537,353 | ||
Dividends payable | – | 404,663 | ||
Line of credit payable | – | 675,000 | ||
Current portion of notes payable | 2,604,804 | 920,898 | ||
Current portion of finance lease liability | 119,946 | 35,509 | ||
Current portion of operating lease liability | 76,956 | 130,285 | ||
Liabilities related to discontinued operations | 677 | 677 | ||
Total current liabilities | 7,782,398 | 7,704,385 | ||
LONG-TERM LIABILITIES | ||||
Notes payable, net of current portion and debt issuance costs | 291,174 | 2,831,359 | ||
Finance lease liability, net of current portion | – | 123,084 | ||
Operating lease liability, net of current portion | 35,951 | 112,907 | ||
Deferred taxes | 313,000 | 216,000 | ||
Other liabilities related to discontinued operations | – | – | ||
Total long-term liabilities | 640,125 | 3,283,350 | ||
Total liabilities | 8,422,523 | 10,987,735 | ||
SHAREHOLDERS’ EQUITY | ||||
Preferred stock, no par value, 10,000,000 shares authorized, | ||||
no shares issued and outstanding | – | – | ||
Common stock, no par value; 50,000,000 shares authorized, | ||||
8,081,266 shares issued and outstanding September 30, 2023 | ||||
8,210,266 shares issued and outstanding September 30, 2024 | 1,173,061 | 1,025,341 | ||
Retained earnings | 5,238,769 | 5,436,544 | ||
Total shareholders’ equity | 6,411,830 | 6,461,885 | ||
$ | 14,834,353 | $ | 17,449,620 |
Note – Operating EBITDA (excluding investment portfolio income)
Three Months Ended | Six Months Ended | ||||||||||
EBITDA Calculation | September 30, | September 30, | |||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Operating Income from Continuing Operations | $ | 486,639 | $ | 591,187 | $ | 535,495 | $ | 643,378 | |||
Add: | |||||||||||
Depreciation/Amortization Expense | $ | 66,757 | $ | 78,522 | $ | 141,508 | $ | 151,283 | |||
EBITDA (Excluding Investment Portfolio Income) | $ | 553,396 | $ | 669,709 | $ | 677,003 | $ | 794,661 |
The Company elects not to include investment portfolio income because the Company believes it is non-operating in nature.
The Company uses Operating EBITDA as a measure of operating performance. However, Operating EBITDA is not a recognized measurement under U.S. generally accepted accounting principles, or GAAP, and when analyzing its operating performance, investors should use Operating EBITDA in addition to, and not as an alternative for, income as determined in accordance with GAAP. Because not all companies use identical calculations, its presentation of Operating EBITDA may not be comparable to similarly titled measures of other companies and is therefore limited as a comparative measure. Furthermore, as an analytical tool, Operating EBITDA has additional limitations, including that (a) it is not intended to be a measure of free cash flow, as it does not consider certain cash requirements such as tax payments; (b) it does not reflect changes in, or cash requirements for, its working capital needs; and (c) although depreciation and amortization are non-cash charges, the assets being depreciated and amortized often will have to be replaced in the future, and Operating EBITDA does not reflect any cash requirements for such replacements, or future requirements for capital expenditures or contractual commitments. To compensate for these limitations, the Company evaluates its profitability by considering the economic effect of the excluded expense items independently as well as in connection with its analysis of cash flows from operations and through the use of other financial measures.
The Company believes Operating EBITDA is useful to an investor in evaluating its operating performance because it is widely used to measure a company’s operating performance without regard to certain non-cash or unrealized expenses (such as depreciation and amortization) and expenses that are not reflective of its core operating results over time. The Company believes Operating EBITDA presents a meaningful measure of corporate performance exclusive of its capital structure, the method by which assets were acquired, and non-cash charges and provides additional useful information to measure performance on a consistent basis, particularly with respect to changes in performance from period to period.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
French Government Collapses After Vote Of No Confidence
The French government collapsed on Wednesday following a successful no-confidence vote, throwing France, the eurozone’s second-largest economy, into political turmoil.
The Details: The motion passed with 331 votes, far exceeding the required 288, as lawmakers from both the leftist New Popular Front (NFP) alliance and the far-right National Rally (RN) united in opposition.
Read Next: UnitedHealthcare CEO Brian Thompson Fatally Shot Outside NYC Hotel
The historic vote was triggered after Prime Minister Michel Barnier used special constitutional powers to force a social security budget bill through Parliament without a vote.
Barnier, who had been in office for just three months, will now have to resign, marking the shortest tenure for a prime minister in France’s Fifth Republic.
Why It Matters: The government’s fall complicates France’s efforts to address its budget deficit and implement planned spending cuts and tax increases.
French President Emmanuel Macron must face the challenge of appointing a new prime minister, with the political landscape remaining divided until the next possible legislative elections in summer 2025.
Barnier is expected to resign immediately and Macron is supposed to ask him to continue as a “caretaker” prime minister while looking for a replacement.
Investors can monitor the market’s reaction to the political turmoil through the iShares MSCI France ETF EWQ which provides targeted exposure to the French economy. The ETF’s top holdings include LVMH Moet Hennessy Louis Vuitton LVMHF LVMUY, TotalEnergies SE TTE and Schneider Electric SE SBGSY.
Read Next:
Photo: Shutterstock
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Synopsys Q4 Earnings: Revenue Beat, EPS Beat, Soft Guidance, Expanding Opportunities Powered By 'AI-Driven Reinvention Of Compute'
Synopsys Inc SNPS reported fourth-quarter financial results after the market close on Wednesday. Here’s a rundown of the report.
- Q4 Revenue: $1.64 billion, versus estimates of $1.63 billion
- Q4 Adjusted EPS: $3.40, versus estimates of $3.30
“The fourth quarter was a strong finish to a transformational year for Synopsys. We achieved record financial results while doubling down on our strategy with the sale of our Software Integrity business and the pending acquisition of Ansys,” said Sassine Ghazi, president and CEO of Synopsys.
“Looking ahead, the AI-driven reinvention of compute is accelerating the pace, scale and complexity of technology R&D, which expands our opportunity to solve engineering challenges from silicon to systems.”
Synopsys said its previously announced acquisition of Ansys is expected to close in the first half of 2025. The company is working cooperatively with the Federal Trade Commission (FTC) to conclude the investigation and the staff’s review of Synopsys’ proposed remedies.
Outlook: Synopsys expects first-quarter revenue to be in the range of $1.435 billion to $1.465 billion versus estimates of $1.643 billion, according to Benzinga Pro. The company sees first-quarter adjusted earnings between $2.77 and $2.82 per share versus estimates of $3.53 per share.
Synopsys noted that its outlook reflects a change in the company’s fiscal year from a 52/53-week period ending on the Saturday nearest to Oct. 31 of each year to Oct. 31 of each year. As a result of this change, there will be 10 fewer days in the first half of fiscal year 2025.
“In 2025, we expect to deliver double-digit revenue growth grounded in pragmatism given continued macro uncertainties and the impact of our fiscal year calendar change,” said Shelagh Glaser, CFO of Synopsys.
SNPS Price Action: Synopsys shares were down 6.23% in after-hours, trading at $551.37 at the time of publication Wednesday, per Benzinga Pro.
Read Next:
Photo: Courtesy of Synopsys.
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.