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Constellation Software Inc. and Topicus.com Inc. Announce Results for Topicus.com Inc. for the First Quarter Ended March 31, 2024

TORONTO, May 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 first quarter ended March 31, 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 months ended March 31, 2024 and the accompanying notes, our Management’s Discussion and Analysis for the three months ended March 31, 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.

Q1 2024 Headlines:

Total revenue for the quarter ended March 31, 2024 was €306.6 million, an increase of 16%, or €42.1 million, compared to €264.4 million for the comparable period in 2023. The increase for the three-month period compared to the same period in the prior year is primarily attributable to growth from acquisitions as the Company experienced organic growth of 5% in the quarter.   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 March 31, 2024 increased €7.2 million to €28.3 million compared to €21.1 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.22 in the quarter ended March 31, 2024 compared to €0.17 for the same period in 2023.

For the quarter ended March 31, 2024, CFO increased €53.5 million to €227.5 million compared to €174.0 million for the same period in 2023 representing an increase of 31%.

For the quarter ended March 31, 2024, FCFA2S increased €32.3 million to €133.4 million compared to €101.1 million for the same period in 2023 representing an increase of 32%.      

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
March 31,
 
    2024   2023    
  (€ in millions)
         
Net cash flows from operating activities   227.5   174.0    
Adjusted for:        
Interest paid on lease obligations   (0.5 ) (0.3 )  
Interest paid on other facilities   (3.2 ) (3.1 )  
Credit facility transaction costs     (0.1 )  
Payments of lease obligations   (5.8 ) (5.3 )  
Property and equipment purchased   (2.7 ) (2.0 )  
         
    215.4   163.3    
Less amount attributable to        
  non-controlling interests   (82.0 ) (62.2 )  
         
Free cash flow available to shareholders   133.4   101.1    
         
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                    
                  March 31, 2024 December 31, 2023 March 31, 2023  
                         
Assets                    
                         
Current assets:                    
  Cash             254,599 179,059 197,265    
  Accounts receivable           175,767 134,079 143,923    
  Unbilled revenue           49,454 44,838 47,210    
  Inventories             4,516 4,517 1,481    
  Other assets             63,845 55,250 49,574    
                  548,181 417,742 439,453    
                         
Non-current assets:                  
  Property and equipment           21,363 20,030 19,685    
  Right of use assets           63,054 61,066 53,933    
  Deferred income taxes           20,326 16,412 21,850    
  Other assets             13,437 13,824 17,021    
  Intangible assets 947,417 906,082 871,290    
                  1,065,598 1,017,415 983,778    
                         
Total assets             1,613,779 1,435,157 1,423,231    
                         
Liabilities and Shareholders’ Equity                
                         
Current liabilities:                    
  Topicus Revolving Credit Facility and current portion of term and other loans 265,221 161,077 123,871    
  Loan from CSI           30,361    
  Accounts payable and accrued liabilities         227,130 211,423 190,889    
  Deferred revenue           343,430 138,854 288,188    
  Provisions             1,535 1,708 1,081    
  Acquisition holdback payables           13,808 12,292 10,293    
  Lease obligations           21,338 20,614 18,384    
  Income taxes payable           23,102 20,068 14,041    
                  895,563 566,035 677,109    
                         
Non-current liabilities:                  
  Term and other loans           62,973 64,615 44,935    
  Deferred income taxes           148,142 137,155 147,205    
  Acquisition holdback payables           7,690 1,339 1,958    
  Lease obligations           42,748 41,524 36,635    
  Other liabilities           36,017 32,005 27,246    
                  297,570 276,639 257,979    
                         
Total liabilities             1,193,133 842,674 935,088    
                         
                         
Shareholders’ Equity:                  
  Capital stock             39,412 39,412 39,412    
  Accumulated other comprehensive income (loss)       3,016 2,390 (469 )  
  Retained earnings (deficit)           192,136 297,382 240,820    
  Non-controlling interests           186,082 253,299 208,380    
                  420,646 592,483 488,143    
                         
                         
                         
Total liabilities and shareholders’ equity         1,613,779 1,435,157 1,423,231    
                         
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 March 31,  
              2024     2023    
                     
Revenue                
License         9,165     6,977    
Professional services       75,005     69,340    
Hardware and other       5,551     2,680    
Maintenance and other recurring     216,848     185,432    
              306,568     264,430    
Expenses                
Staff           173,116     150,108    
Hardware         4,620     1,578    
Third party license, maintenance and professional services 23,352     20,548    
Occupancy         2,710     2,466    
Travel, telecommunications, supplies, software and equipment 11,983     9,564    
Professional fees         5,092     4,280    
Other, net         4,305     6,214    
Depreciation         8,012     7,296    
Amortization of intangible assets     31,672     27,960    
              264,861     230,014    
                     
Impairment of intangible and other non-financial assets 633        
Bargain purchase (gain)       (323 )      
Finance and other expenses (income)     4,998     4,950    
              5,309     4,950    
                     
Income (loss) before income taxes     36,398     29,467    
                     
Current income tax expense (recovery)     15,083     12,328    
Deferred income tax expense (recovery)     (6,998 )   (3,989 )  
Income tax expense (recovery)       8,085     8,338    
                     
Net income (loss)         28,314     21,128    
                     
Net income (loss) attributable to:            
Equity holders of Topicus       18,089     13,900    
Non-controlling interests       10,225     7,229    
Net income (loss)         28,314     21,128    
                     
Weighted average shares              
Basic shares outstanding       82,195,644     81,889,764    
Diluted shares outstanding     129,841,819     129,841,819    
                     
Earnings (loss) per common share of Topicus          
Basic         0.22     0.17    
Diluted         0.22     0.17    
                     
                     
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 March 31,  
              2024   2023    
                     
Net income (loss)         28,314   21,128    
                     
Items that are or may be reclassified subsequently to net income (loss):        
                     
  Foreign currency translation differences from foreign operations and other 1,926   (796 )  
                     
Other comprehensive (loss) income for the period, net of income tax 1,926   (796 )  
                     
Total comprehensive income (loss) for the period 30,240   20,332    
                     
Total other comprehensive income (loss) attributable to:        
Equity holders of Topicus       625   (237 )  
Non-controlling interests       1,301   (559 )  
Total other comprehensive income (loss)     1,926   (796 )  
                     
Total comprehensive income (loss) attributable to:        
Equity holders of Topicus       18,714   13,663    
Non-controlling interests       11,526   6,669    
Total comprehensive income (loss)     30,240   20,332    
                     
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                
Three months ended March 31, 2024              
             
      Capital Stock  Accumulated other comprehensive (loss) income Retained earnings (Deficit) Total   Non-controlling interests Total equity  
                   
Balance at January 1, 2024 39,412  2,390 297,382   339,185   253,299   592,483    
                   
Total comprehensive income (loss) for the period:              
                   
Net income (loss) –  18,089   18,089   10,225   28,314    
                   
Other comprehensive income (loss)              
                   
Foreign currency translation differences from              
  foreign operations and other, net of income tax –  625   625   1,301   1,926    
                   
Total other comprehensive income (loss)              
  for the period –  625   625   1,301   1,926    
                   
Total comprehensive income (loss) for the period –  625 18,089   18,714   11,526   30,240    
                   
Transactions with owners, recorded directly in equity              
                   
  Other movements in non-controlling interests and equity –  72   72   31   103    
                   
  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 )  
                   
  Dividends paid to non-controlling interests –      (74,539 ) (74,539 )  
                   
Balance at March 31, 2024 39,412  3,016 192,136   234,565   186,082   420,646    
                   
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              
Three months ended March 31, 2023            
                 
           
      Capital Stock  Accumulated other comprehensive (loss) income Retained earnings (deficit) Total   Non-controlling interests Total equity
                 
Balance at January 1, 2023 39,412  (232 ) 226,919 266,099   201,685   467,784  
                 
Total comprehensive income (loss) for the period:            
                 
Net income (loss) –    13,900 13,900   7,229   21,128  
                 
Other comprehensive income (loss)            
                 
Foreign currency translation differences from            
  foreign operations and other, net of income tax –  (237 ) (237 ) (559 ) (796 )
                 
Total other comprehensive income (loss) for the period –  (237 ) (237 ) (559 ) (796 )
                 
Total comprehensive income (loss) for the period –  (237 ) 13,900 13,663   6,669   20,332  
                 
                 
Transactions with owners, recorded directly in equity            
                 
  Other movements in non-controlling interests and equity –    1 1   25   26  
                 
Balance at March 31, 2023 39,412  (469 ) 240,820 279,763   208,380   488,143  
                 
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 March 31,  
                2024     2023    
                       
Cash flows from (used in) operating activities:        
  Net income (loss)     28,314     21,128    
  Adjustments for:            
    Depreciation       8,012     7,296    
    Amortization of intangible assets 31,672     27,960    
    Impairment of intangible and other non-financial assets   633        
    Bargain purchase (gain)     (323 )      
    Finance and other expenses (income)   4,998     4,950    
    Income tax expense (recovery) 8,085     8,338    
  Change in non-cash operating assets and liabilities        
    exclusive of effects of business combinations (note 16) 155,008     116,599    
  Income taxes (paid) received (8,901 )   (12,279 )  
  Net cash flows from (used in) operating activities 227,497     173,993    
                       
Cash flows from (used in) financing activities:        
  Interest paid on lease obligations   (457 )   (306 )  
  Interest paid on other facilities   (3,161 )   (3,060 )  
  Net increase (decrease) in Topicus Revolving Credit Facility 105,000     (10,000 )  
  Proceeds from issuance of term and other loans 816     4,277    
  Repayments of term and other loans (3,684 )   (68,445 )  
  Credit facility transaction costs     (63 )  
  Payments of lease obligations   (5,817 )   (5,263 )  
  Dividends paid to non-controlling interests   (74,539 )      
  Dividends paid to shareholders of the Company   (127,641 )      
  Net cash flows from (used in) in financing activities (109,483 )   (82,860 )  
                       
Cash flows from (used in) investing activities:        
  Acquisition of businesses (note 4) (36,542 )   (24,796 )  
  Cash obtained with acquired businesses (note 4)   7,024     972    
  Post-acquisition settlement payments, net of receipts (4,214 )   (4,487 )  
  (Increase) decrease in restricted cash   (6,000 )      
  Property and equipment purchased (2,654 )   (1,981 )  
  Net cash flows from (used in) investing activities (42,386 )   (30,292 )  
                       
Effect of foreign currency on        
  cash and cash equivalents (88 )   (348 )  
                       
Increase (decrease) in cash 75,540     60,493    
                       
Cash, beginning of period 179,059     136,772    
                       
Cash, end of period 254,599     197,265    
                       

 


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