TORONTO, Oct. 31, 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 third quarter ended September 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 nine months ended September 30, 2024 and the accompanying notes, our Management’s Discussion and Analysis for the three and nine months ended September 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.
Q3 2024 Headlines:
Revenue increased 12% (4% organic growth) to €312.2 million compared to €278.8 million in Q3 2023. Net income increased 34% to €38.0 million (€0.28 on a diluted per share basis) from €28.3 million (€0.22 on a diluted per share basis). Acquisitions were completed for aggregate cash consideration of €18.2 million (which includes acquired cash). Deferred payments associated with these acquisitions have an estimated value of €8.5 million resulting in total consideration of €26.7 million.Cash flows from operations (“CFO”) increased €6.2 million to €31.7 million compared to €25.5 million in Q3 2023.Free cash flow available to shareholders1 (“FCFA2S”) increased €3.9 million to €10.4 million compared to €6.5 million in Q3 2023.
Total revenue for the quarter ended September 30, 2024 was €312.2 million, an increase of 12%, or €33.4 million, compared to €278.8 million for the comparable period in 2023. For the first nine months of 2024 total revenues were €930.0 million, an increase of 14%, or €114.7 million, compared to €815.3 million for the comparable period in 2023. The increase for both the three and nine-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 September 30, 2024 increased €9.7 million to €38.0 million compared to €28.3 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.28 in the quarter ended September 30, 2024 compared to net income per basic and diluted share of €0.22 for the same period in 2023. For the nine months ended September 30, 2024 net income increased €20.4 million to €93.3 million compared to €72.9 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.71 in the nine months ended September 30, 2024 compared to €0.57 for the same period in 2023.
For the quarter ended September 30, 2024, CFO increased €6.2 million to €31.7 million compared to €25.5 million for the same period in 2023 representing an increase of 24%. For the nine months ended September 30, 2024, CFO increased €83.9 million to €268.0 million compared to €184.1 million for the same period in 2023 representing an increase of 46%.
For the quarter ended September 30, 2024, FCFA2S increased €3.9 million to €10.4 million compared to €6.5 million for the same period in 2023 representing an increase of 61%. For the nine months ended September 30, 2024, FCFA2S increased €46.2 million to €140.7 million compared to €94.5 million for the same period in 2023 representing an increase of 49%.
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
September 30, Nine months ended
September 30, 2024 2023 2024 2023 (€ in millions) (€ in millions) Net cash flows from operating activities 31.7 25.5 268.0 184.1 Adjusted for: Interest paid on lease obligations (0.5)(0.4) (1.5)(1.0) Interest paid on other facilities (5.6)(4.8) (15.4)(11.4) Proceeds from sale of interest rate cap – (0.7) – 4.8 Credit facility transaction costs (0.7)- (1.0)(0.2) Payments of lease obligations (6.1)(5.5) (18.1)(16.3) Property and equipment purchased (2.0)(1.4) (6.4)(5.2) 16.9 12.8 225.7 154.8 Less amount attributable to non-controlling interests (6.5)(6.3) (85.0)(60.3) Free cash flow available to shareholders 10.4 6.5 140.7 94.5 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
jbaksh@csisoftware.com
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 September 30, 2024December 31, 2023September 30, 2023 Assets Current assets: Cash 234,603179,059161,707 Accounts receivable 107,575134,079114,818 Unbilled revenue 46,39444,83848,132 Inventories 5,2624,5174,797 Other assets 63,83055,25059,685 457,663417,742389,139 Non-current assets: Property and equipment 20,73020,03019,437 Right of use assets 67,18961,06655,631 Deferred income taxes 20,46816,4126,392 Other assets 12,94213,82413,540 Intangible assets927,295906,082913,333 1,048,6241,017,4151,008,334 Total assets 1,506,2861,435,1571,397,473 Liabilities and Shareholders’ Equity Current liabilities: Topicus Revolving Credit Facility and current portion of term and other loans295,855161,077175,845 Accounts payable and accrued liabilities 184,555211,423172,183 Deferred revenue 202,880138,854179,833 Provisions 1,5781,7081,208 Acquisition holdback payables 14,31512,2929,875 Lease obligations 21,54420,61419,055 Income taxes payable 21,61620,06819,689 742,343566,035577,688 Non-current liabilities: Term and other loans 49,25964,61565,468 Deferred income taxes 142,913137,155135,164 Acquisition holdback payables 10,4391,3391,529 Lease obligations 46,78841,52437,665 Other liabilities 44,15532,00527,733 293,554276,639267,559 Total liabilities 1,035,897842,674845,247 Shareholders’ Equity: Capital stock 39,41239,41239,412 Accumulated other comprehensive income (loss) 2,6492,390839 Retained earnings (deficit) 232,796297,382273,519 Non-controlling interests 195,532253,299238,456 470,389592,483552,226 Total liabilities and shareholders’ equity 1,506,2861,435,1571,397,473
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 September 30, Nine months ended September 30, 2024 2023 2024 2023 Revenue License 8,650 7,513 25,984 22,338 Professional services 76,318 72,104 230,632 213,418 Hardware and other 4,494 3,906 15,081 10,291 Maintenance and other recurring 222,760 195,286 658,282 569,276 312,222 278,810 929,979 815,322 Expenses Staff 164,506 152,862 515,083 458,811 Hardware 3,204 2,988 11,395 7,111 Third party license, maintenance and professional services23,737 22,265 70,794 64,153 Occupancy 2,674 679 8,063 5,705 Travel, telecommunications, supplies, software and equipment11,789 11,140 36,675 31,407 Professional fees 4,991 3,815 15,265 12,653 Other, net 5,008 3,303 13,373 10,481 Depreciation 8,430 7,718 24,880 22,708 Amortization of intangible assets 34,255 31,874 99,337 89,820 258,594 236,644 794,865 702,848 Impairment of intangible and other non-financial assets- – 633 – Bargain purchase (gain) – – (323) – Finance and other expenses (income) 6,821 5,308 18,255 14,705 6,821 5,308 18,565 14,705 Income (loss) before income taxes 46,807 36,857 116,549 97,769 Current income tax expense (recovery) 16,168 14,317 44,698 41,543 Deferred income tax expense (recovery) (7,390) (5,805) (21,429) (16,699)Income tax expense (recovery) 8,778 8,512 23,269 24,844 Net income (loss) 38,029 28,345 93,280 72,926 Net income (loss) attributable to: Equity holders of Topicus 23,340 17,983 58,447 46,455 Non-controlling interests 14,689 10,362 34,834 26,471 Net income (loss) 38,029 28,345 93,280 72,926 Weighted average shares Basic shares outstanding 82,912,026 81,889,764 82,664,754 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 0.28 0.22 0.71 0.57 Diluted 0.28 0.22 0.71 0.57
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 September 30, Nine months ended September 30, 2024 2023 2024 2023 Net income (loss)38,029 28,345 93,280 72,926 Items that are or may be reclassified subsequently to net income (loss): Foreign currency translation differences from foreign operations and other(2,365) 481 806 2,684 Other comprehensive (loss) income for the period, net of income tax(2,365) 481 806 2,684 Total comprehensive income (loss) for the period35,664 28,826 94,086 75,610 Total other comprehensive income (loss) attributable to: Equity holders of Topicus(1,019) (5) 258 1,078Non-controlling interests(1,346) 486 547 1,606Total other comprehensive income (loss)(2,365) 481 806 2,684 Total comprehensive income (loss) attributable to: Equity holders of Topicus22,321 17,978 58,705 47,533Non-controlling interests13,342 10,848 35,381 28,076Total comprehensive income (loss)35,664 28,826 94,086 75,610
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 Nine months ended September 30, 2024 Capital StockAccumulated other
comprehensive
(loss) incomeRetained
earnings
(Deficit) Total Non-controlling
interests Total 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)–58,447 58,447 34,834 93,280 Other comprehensive income (loss) Foreign currency translation differences from foreign operations and other, net of income tax-258- 258 547 806 Total other comprehensive income (loss) for the period–258– 258 547 806 Total comprehensive income (loss) for the period–25858,447 58,705 35,381 94,086 Transactions with owners, recorded directly in equity Other movements in non-controlling interests and equity–(188)(188)(305)(493) Exchange of Topicus Coop ordinary units held by non-controlling interests to subordinate voting shares of Topicus–4,797 4,797 (4,797)- 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— – (78,998)(78,998) Balance at September 30, 202439,4122,649232,796 274,857 195,532 470,389
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 Nine months ended September 30, 2023 Capital StockAccumulated other
comprehensive
(loss) income Retained
earnings
(deficit)TotalNon-controlling
interests Total equity Balance at January 1, 202339,412(232)226,919266,099201,685 467,784 Total comprehensive income (loss) for the period: Net income (loss)– 46,45546,45526,471 72,926 Other comprehensive income (loss) Foreign currency translation differences from foreign operations and other, net of income tax-1,078 -1,0781,606 2,684 Total other comprehensive income (loss) for the period–1,078 –1,0781,606 2,684 Total comprehensive income (loss) for the period–1,078 46,45547,53328,076 75,610 Transactions with owners, recorded directly in equity Other movements in non-controlling interests and equity-(7)144138(196)(58) Contribution by non-controlling interests– –9,617 9,617 Dividends paid to non-controlling interests– –(726)(726) Balance at September 30, 202339,412839 273,519313,770238,456 552,226
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 September 30, Nine months ended September 30, 2024 2023 2024 2023 Cash flows from (used in) operating activities: Net income (loss)38,029 28,345 93,280 72,926 Adjustments for: Depreciation8,430 7,718 24,880 22,708 Amortization of intangible assets34,255 31,874 99,337 89,820 Impairment of intangible and other non-financial assets- – 633 – Bargain purchase (gain)- – (323) – Finance and other expenses (income)6,821 5,308 18,255 14,705 Income tax expense (recovery)8,778 8,512 23,269 24,844 Change in non-cash operating assets and liabilities exclusive of effects of business combinations(49,742) (42,776) 46,296 (1,642) Income taxes (paid) received(14,839) (13,463) (37,588) (39,216) Net cash flows from (used in) operating activities31,732 25,518 268,039 184,145 Cash flows from (used in) financing activities: Interest paid on lease obligations(524) (375) (1,461) (1,029) Interest paid on other facilities(5,553) (4,801) (15,441) (11,366) Proceeds from sale of interest rate cap- (707) – 4,809 Net increase (decrease) in Topicus Revolving Credit Facility50,000 5,000 135,000 40,000 Proceeds from issuance of term and other loans- 4,954 29,733 31,172 Repayment of loan from CSI- (29,878) – (29,878) Increase (decrease) in loan from Vela Software Group(300) 1,810 (300) 1,342 Contribution from Vela Software Group into GeoSoftware and Geoactive- 9,617 – 9,617 Return of capital to non-controlling interests- – (9,048) – Repayments of term and other loans(39,014) (4,232) (44,681) (77,173) Credit facility transaction costs(657) – (971) (238) Payments of lease obligations(6,124) (5,475) (18,057) (16,280) Other financing activities(356) (24) (356) (24) Dividends paid to non-controlling interests(1,809) – (78,997) (726) Dividends paid to shareholders of the Company- – (127,641) – Net cash flows from (used in) in financing activities(4,337) (24,112) (132,222) (49,775) Cash flows from (used in) investing activities: Acquisition of businesses(18,221) (7,190) (65,052) (95,238) Cash obtained with acquired businesses2,325 1,443 14,444 7,026 Post-acquisition settlement payments, net of receipts(6,707) (4,845) (15,940) (15,900) (Increase) decrease in restricted cash(1,525) – (7,525) – Property and equipment purchased(1,960) (1,381) (6,366) (5,249) Net cash flows from (used in) investing activities(26,090) (11,973) (80,439) (109,362) Effect of foreign currency on cash and cash equivalents(452) (41) 166 (73) Increase (decrease) in cash854 (10,608) 55,544 24,935 Cash, beginning of period233,749 172,315 179,059 136,772 Cash, end of period234,603 161,707 234,603 161,707