TORONTO, Aug. 01, 2024 (GLOBE NEWSWIRE) — Topicus.com Inc. (TSXV:TOI) in a joint release with Constellation Software Inc. (TSX:CSU) today announced financial results for Topicus.com Inc. (“Topicus” or the “Company”) for the second quarter ended June 30, 2024. Please note that all amounts referred to in this press release are in Euros unless otherwise stated.
The following press release should be read in conjunction with the Company’s Unaudited Condensed Consolidated Interim Financial Statements for the three and six months ended June 30, 2024 and the accompanying notes, our Management’s Discussion and Analysis for the three and six months ended June 30, 2024 and the Annual Consolidated Financial Statements of Topicus.com Inc. for the year ended December 31, 2023, which we prepared in accordance with International Financial Reporting Standards (“IFRS”) and the Company’s annual Management’s Discussion and Analysis for the year ended December 31, 2023, which can be found on SEDAR+ at www.sedarplus.com and on Topicus.com Inc.’s website www.topicus.com. Additional information about Topicus.com Inc. is also available on SEDAR+ at www.sedarplus.com.
Q2 2024 Headlines:
Revenue increased 14% (4% organic growth) to €311.2 million compared to €272.1 million in Q2 2023. Net income increased 15% to €26.9 million (€0.21 on a diluted per share basis) from €23.5 million (€0.18 on a diluted per share basis). Acquisitions were completed for aggregate cash consideration of €10.3 million (which includes acquired cash). Deferred payments associated with these acquisitions have an estimated value of €6.3 million resulting in total consideration of €16.6 million.Cash flows from operations (“CFO”) increased €24.2 million to €8.8 million compared to negative €15.4 million in Q2 2023.Free cash flow available to shareholders1 (“FCFA2S”) increased €12.8 million to negative €3.8 million compared to negative €16.6 million in Q2 2023.
Total revenue for the quarter ended June 30, 2024 was €311.2 million, an increase of 14%, or €39.1 million, compared to €272.1 million for the comparable period in 2023. For the first six months of 2024 total revenues were €617.8 million, an increase of 15%, or €81.2 million, compared to €536.5 million for the comparable period in 2023. The increase for both the three and six-month periods compared to the same periods in the prior year is primarily attributable to growth from acquisitions as the Company experienced organic growth of 4% for each of the periods. Organic growth is not a standardized financial measure and might not be comparable to measures disclosed by other issuers.
Net income for the quarter ended June 30, 2024 increased €3.5 million to €26.9 million compared to €23.5 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.21 in the quarter ended June 30, 2024 compared to net income per basic and diluted share of €0.18 for the same period in 2023. For the six months ended June 30, 2024 net income increased €10.7 million to €55.2 million compared to €44.6 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.43 in the six months ended June 30, 2024 compared to €0.35 for the same period in 2023.
For the quarter ended June 30, 2024, CFO were €8.8 million compared to negative €15.4 million for the same period in 2023. For the six months ended June 30, 2024, CFO increased €77.7 million to €236.3 million compared to €158.6 million for the same period in 2023 representing an increase of 49%.
For the quarter ended June 30, 2024, FCFA2S was negative €3.8 million compared to negative €16.6 million for the same period in 2023. For the six months ended June 30, 2024, FCFA2S increased €45.6 million to €130.1 million compared to €84.5 million for the same period in 2023 representing an increase of 54%.
Forward Looking Statements
Certain statements herein may be “forward looking” statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Topicus or the industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward looking statements. These forward looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof and Topicus assumes no obligation, except as required by law, to update any forward looking statements to reflect new events or circumstances.
Non-IFRS Measures
Free cash flow available to shareholders ‘‘FCFA2S’’ refers to net cash flows from operating activities less interest paid on lease obligations, interest paid on other facilities, credit facility transaction costs, repayments of lease obligations, dividends paid to redeemable preferred securities holders, and property and equipment purchased, and includes interest and dividends received, and the proceeds from sale of interest rate caps. The portion of this amount applicable to non-controlling interests is then deducted. Topicus believes that FCFA2S is useful supplemental information as it provides an indication of the uncommitted cash flow that is available to shareholders if Topicus does not make any acquisitions, or investments, and does not repay any debts. While Topicus could use the FCFA2S to pay dividends or repurchase shares, Topicus’ objective is to invest all of our FCFA2S in acquisitions which meet Topicus’ hurdle rate.
FCFA2S is not a recognized measure under IFRS and, accordingly, readers are cautioned that FCFA2S should not be construed as an alternative to net cash flows from operating activities.
The following table reconciles FCFA2S to net cash flows from operating activities:
Three months ended
June 30, Six months ended
June 30, 2024 2023 2024 2023 (€ in millions) (€ in millions) Net cash flows from operating activities 8.8 (15.4) 236.3 158.6 Adjusted for: Interest paid on lease obligations (0.5)(0.3) (0.9)(0.7) Interest paid on other facilities (6.7)(3.5) (9.9)(6.6) Credit facility transaction costs (0.3)(0.2) (0.3)(0.2) Payments of lease obligations (6.1)(5.5) (11.9)(10.8) Property and equipment purchased (1.8)(1.9) (4.4)(3.9) (6.6)(26.8) 208.8 136.5 Less amount attributable to non-controlling interests 2.8 10.2 (78.7)(52.0) Free cash flow available to shareholders (3.8)(16.6) 130.1 84.5 Due to rounding, certain totals may not foot.
About Topicus.com Inc.
Topicus’ subordinate voting shares are listed on the Toronto Venture Stock Exchange under the symbol “TOI”. Topicus acquires, manages and builds vertical market software businesses.
About Constellation Software Inc.
Constellation’s common shares are listed on the Toronto Stock Exchange under the symbol “CSU”. Constellation acquires, manages and builds vertical market software businesses.
For further information:
Jamal Baksh
Chief Financial Officer
(416) 861-9677
info@topicus.com
www.topicus.com
SOURCE: TOPICUS.COM INC.
Topicus.com Inc. Condensed Consolidated Interim Statements of Financial Position (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited June 30, 2024December 31, 2023June 30, 2023 Assets Current assets: Cash 233,749179,059172,315 Accounts receivable 121,629134,079130,456 Unbilled revenue 47,74044,83848,701 Inventories 4,9704,5174,268 Other assets 62,95555,25054,657 471,043417,742410,396 Non-current assets: Property and equipment 21,00720,03020,372 Right of use assets 62,14761,06657,919 Deferred income taxes 21,08916,4128,288 Other assets 13,13013,82412,161 Intangible assets933,837906,082935,300 1,051,2091,017,4151,034,041 Total assets 1,522,2521,435,1571,444,437 Liabilities and Shareholders’ Equity Current liabilities: Topicus Revolving Credit Facility and current portion of term and other loans246,155161,077168,228 Loan from CSI –30,281 Accounts payable and accrued liabilities 177,887211,423162,868 Deferred revenue 279,338138,854241,980 Provisions 1,6381,7081,682 Acquisition holdback payables 15,27012,29214,878 Lease obligations 21,74920,61419,280 Income taxes payable 20,61620,06816,510 762,653566,035655,707 Non-current liabilities: Term and other loans 89,88064,61565,807 Deferred income taxes 145,807137,155140,684 Acquisition holdback payables 7,0691,3391,289 Lease obligations 41,47841,52439,684 Other liabilities 38,49132,00527,219 322,726276,639274,682 Total liabilities 1,085,379842,674930,388 Shareholders’ Equity: Capital stock 39,41239,41239,412 Accumulated other comprehensive income (loss) 3,6672,390851 Retained earnings (deficit) 208,991297,382255,528 Non-controlling interests 184,802253,299218,258 436,873592,483514,048 Total liabilities and shareholders’ equity 1,522,2521,435,1571,444,437
Topicus.com Inc. Condensed Consolidated Interim Statements of Income (Loss) (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Revenue License 8,169 7,847 17,334 14,825 Professional services 79,308 71,974 154,314 141,314 Hardware and other 5,037 3,705 10,588 6,385 Maintenance and other recurring 218,674 188,557 435,522 373,989 311,189 272,083 617,757 536,513 Expenses Staff 177,462 155,841 350,577 305,949 Hardware 3,570 2,545 8,190 4,123 Third party license, maintenance and professional services23,705 21,340 47,056 41,888 Occupancy 2,679 2,560 5,389 5,026 Travel, telecommunications, supplies, software and equipment12,904 10,703 24,887 20,267 Professional fees 5,183 4,557 10,274 8,837 Other, net 4,060 964 8,365 7,178 Depreciation 8,438 7,695 16,450 14,990 Amortization of intangible assets 33,410 29,985 65,082 57,946 271,409 236,191 536,271 466,204 Impairment of intangible and other non-financial assets0 – 633 – Bargain purchase (gain) – – (323) – Finance and other expenses (income) 6,435 4,447 11,433 9,396 6,435 4,447 11,744 9,396 Income (loss) before income taxes 33,344 31,445 69,742 60,912 Current income tax expense (recovery) 13,447 14,898 28,530 27,226 Deferred income tax expense (recovery) (7,041) (6,905) (14,039) (10,894)Income tax expense (recovery) 6,406 7,993 14,491 16,332 Net income (loss) 26,938 23,452 55,252 44,580 Net income (loss) attributable to: Equity holders of Topicus 17,018 14,572 35,107 28,472 Non-controlling interests 9,920 8,880 20,145 16,108 Net income (loss) 26,938 23,452 55,252 44,580 Weighted average shares Basic shares outstanding 82,883,874 81,889,764 82,539,759 81,889,764 Diluted shares outstanding 129,841,819 129,841,819 129,841,819 129,841,819 Earnings (loss) per common share of Topicus Basic 0.21 0.18 0.43 0.35 Diluted 0.21 0.18 0.43 0.35
Topicus.com Inc. Condensed Consolidated Interim Statements of Comprehensive Income (Loss) (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Net income (loss) 26,938 23,452 55,252 44,580 Items that are or may be reclassified subsequently to net income (loss): Foreign currency translation differences from foreign operations and other1,244 2,999 3,170 2,203 Other comprehensive (loss) income for the period, net of income tax1,244 2,999 3,170 2,203 Total comprehensive income (loss) for the period28,182 26,451 58,422 46,784 Total other comprehensive income (loss) attributable to: Equity holders of Topicus 651 1,320 1,277 1,083Non-controlling interests 593 1,679 1,894 1,120Total other comprehensive income (loss) 1,244 2,999 3,170 2,203 Total comprehensive income (loss) attributable to: Equity holders of Topicus 17,670 15,892 36,383 29,555Non-controlling interests 10,513 10,559 22,038 17,228Total comprehensive income (loss) 28,182 26,451 58,422 46,784
Topicus.com Inc. Condensed Consolidated Interim Statement of Changes in Shareholders’ Equity (Deficiency) (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited Six months ended June 30, 2024 Capital StockAccumulated other
comprehensive
(loss) incomeRetained
earnings (Deficit)TotalNon-controlling
interestsTotal equity Balance at January 1, 202439,4122,390297,382 339,185 253,299 592,483 Total comprehensive income (loss) for the period: Net income (loss)–35,107 35,107 20,145 55,252 Other comprehensive income (loss) Foreign currency translation differences from foreign operations and other, net of income tax-1,277- 1,277 1,894 3,170 Total other comprehensive income (loss) for the period–1,277– 1,277 1,894 3,170 Total comprehensive income (loss) for the period–1,27735,107 36,383 22,038 58,422 Transactions with owners, recorded directly in equity Other movements in non-controlling interests and equity–(91)(91)(64)(155) Exchange of Topicus Coop ordinary units held by non-controlling interests to subordinate voting shares of Topicus–4,235 4,235 (4,235)- Dividends paid to shareholders of the Company–(127,641)(127,641)- (127,641) Return of capital to non-controlling interests (9,048)(9,048) Dividends paid to non-controlling interests— – (77,188)(77,188) Balance at June 30, 202439,4123,667208,991 252,071 184,802 436,873
Topicus.com Inc. Condensed Consolidated Interim Statement of Changes in Shareholders’ Equity (Deficiency) (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited Six months ended June 30, 2023 Capital StockAccumulated other
comprehensive
(loss) incomeRetained
earnings (deficit)TotalNon-controlling
interestsTotal equity Balance at January 1, 202339,412(232)226,919266,099201,685 467,784 Total comprehensive income (loss) for the period: Net income (loss)– 28,47228,47216,108 44,580 Other comprehensive income (loss) Foreign currency translation differences from foreign operations and other, net of income tax-1,083 -1,0831,120 2,203 Total other comprehensive income (loss) for the period–1,083 –1,0831,120 2,203 Total comprehensive income (loss) for the period–1,083 28,47229,55517,228 46,784 Transactions with owners, recorded directly in equity Other movements in non-controlling interests and equity– 13713770 207 Dividends paid to non-controlling interests– –(726)(726) Balance at June 30, 202339,412851 255,528295,791218,258 514,048
Topicus.com Inc. Condensed Consolidated Interim Statements of Cash Flows (In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.) Unaudited Three months ended June 30, Six months ended June 30, 2024 2023 2024 2023 Cash flows from (used in) operating activities: Net income (loss) 26,938 23,452 55,252 44,580 Adjustments for: Depreciation 8,438 7,695 16,450 14,990 Amortization of intangible assets33,410 29,985 65,082 57,946 Impairment of intangible and other non-financial assets 0 – 633 – Bargain purchase (gain) – – (323) – Finance and other expenses (income) 6,435 4,447 11,433 9,396 Income tax expense (recovery)6,406 7,993 14,491 16,332 Change in non-cash operating assets and liabilities exclusive of effects of business combinations(58,970) (75,465) 96,038 41,134 Income taxes (paid) received(13,849) (13,474) (22,749) (25,752) Net cash flows from (used in) operating activities8,809 (15,367) 236,306 158,626 Cash flows from (used in) financing activities: Interest paid on lease obligations (481) (347) (937) (653) Interest paid on other facilities (6,727) (3,505) (9,888) (6,565) Proceeds from sale of interest rate cap – 5,516 – 5,516 Net increase (decrease) in Topicus Revolving Credit Facility(20,000) 45,000 85,000 35,000 Proceeds from issuance of term and other loans28,917 21,941 29,733 26,218 Increase (decrease) in loan from Vela Software Group – (468) – (468) Return of capital to non-controlling interests (9,048) – (9,048) – Repayments of term and other loans(1,983) (4,497) (5,667) (72,941) Credit facility transaction costs(314) (175) (314) (238) Payments of lease obligations (6,116) (5,543) (11,933) (10,805) Dividends paid to non-controlling interests (2,649) (726) (77,188) (726) Dividends paid to shareholders of the Company – – (127,641) – Net cash flows from (used in) in financing activities(18,401) 57,197 (127,884) (25,663) Cash flows from (used in) investing activities: Acquisition of businesses(10,289) (63,252) (46,831) (88,048) Cash obtained with acquired businesses 5,095 4,611 12,119 5,583 Post-acquisition settlement payments, net of receipts(5,019) (6,567) (9,233) (11,055) (Increase) decrease in restricted cash – – (6,000) – Property and equipment purchased(1,751) (1,888) (4,406) (3,869) Net cash flows from (used in) investing activities(11,964) (67,096) (54,350) (97,388) Effect of foreign currency on cash and cash equivalents706 317 618 (31) Increase (decrease) in cash(20,850) (24,950) 54,690 35,543 Cash, beginning of period254,599 197,265 179,059 136,772 Cash, end of period233,749 172,315 233,749 172,315