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Caldwell Reports Strong Growth in Revenue and Operating Profit

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  • HIGHLIGHTS:

    • Quarterly revenue of $41.7M, a 271% increase year-over-year.

    • Full year revenue of $119.8M, a 106% increase year-over-year.

TORONTO, ON / ACCESSWIRE / November 16, 2021 / Talent acquisition firm The Caldwell Partners International Inc. (TSX:CWL)(OTCQX:CWLPF) today issued its financial results for the fiscal 2021 fourth quarter and full year ended August 31, 2021. All references to quarters or years are for the fiscal periods unless otherwise noted and all currency amounts are in Canadian dollars. Financial results include those of IQTalent Partners, Inc. (IQTP) beginning on the date of acquisition of December 31, 2020.

Financial Highlights (in $000s except per share amounts)

Three Months Ended

Year Ended

8.31.21

8.31.20

8.31.21 1

8.31.20

Professional fees - Caldwell

31,429

11,152

96,120

56,867

Professional fees - IQTP

10,181

-

23,287

-

Consolidated professional fees

41,610

11,152

119,407

56,867

Direct expense reimbursements

128

102

359

1,326

Revenues

41,738

11,254

119,766

58,193

Cost of sales

32,468

8,696

90,621

44,352

Government stimulus grants

-

(2,205

)

(334

)

(2,446

)

Reimbursed direct expenses

128

102

359

1,326

Gross profit

9,142

4,661

29,120

14,961

Selling, general and administrative expenses

7,117

2,752

20,738

11,588

Acquisition-related expenses 2

793

-

2,453

-

Government stimulus grants

-

(393

)

-

(393

)

Operating profit

1,232

2,302

5,929

3,766

Interest expense on lease liability

116

147

464

367

Interest expense on loans payable

7

-

27

-

Investment (income) loss

(13

)

(7

)

(32

)

605

Foreign exchange (income) loss

(301

)

(128

)

53

(179

)

Earnings before tax

1,423

2,290

5,417

2,973

Income tax expense 3

440

(282

)

898

127

Net earnings after tax

983

2,572

4,519

2,846

Basic earnings per share

$

0.039

$

0.126

$

0.190

$

0.139

1) Results include operations from IQTP for the eight months post-acquisition date of December 31, 2020 with intercompany amounts eliminated.

2) Acquisition-related expenses consist of transaction fees and IQTP purchase price structured as compensation expense which will end on December 31, 2022.

3) Income tax expense during the year ended August 31, 2021 includes $562 of income from a favourable tax ruling change during the second quarter allowing for the deductibility on the valid use of PPP funds which had previously been disallowed.

"Fiscal 2021 was a year of enormous and transformational growth for Caldwell," said John Wallace, chief executive officer. "It was busy, unpredictable, and set against an unprecedented backdrop, yet we had one of the most extraordinary years in our firm's history, growing the size of our team, expanding our products and services, and breaking all-time records for a number of key metrics.

"After a challenging second half of Fiscal 2020, our executive search team came roaring back, setting new records for revenue, search volume, and searches per recruiter. Strategic additions to the partner and principal team expanded our global footprint significantly and added depth and breadth to our capabilities across functions, practices and geographies. Our December acquisition of IQTalent Partners accelerated our growth, advancing us into a new market for augmenting internal talent teams on an hourly business model. The IQTP team's year was also one best summed up by amplified growth, closing out the fiscal year close to triple their prior year preacquisition performance. More than a phenomenal investment, IQTP is a fantastic cultural fit, and a real expansion of our collective value proposition."

Wallace continued: "With strong demand from clients and a robust pipeline, we closed out the fiscal year in a powerful position. We are excited for the fiscal year ahead and while we expect some easing in our clients' surge of post-pandemic hiring activity, we anticipate strong growth at IQTP and continued growth in the aggregate. Supported by our solid balance sheet, we do continue to seek out additional portfolio investments that will add to the breadth and depth of the products and services that we can bring to our clients."

For a complete discussion of the quarterly financial results, including a detailed segment analysis, please see the company's Management Discussion and Analysis posted on SEDAR at www.sedar.com.

About Caldwell Partners

Caldwell Partners is a technology-powered talent acquisition firm specializing in recruitment at all levels. Through two distinct brands - Caldwell and IQTalent Partners - the firm leverages the latest innovations in AI to offer an integrated spectrum of services delivered by teams with deep knowledge in their respective areas. Services include candidate research and sourcing through to full recruitment at the professional, executive and board levels, as well as a suite of talent strategy and assessment tools that can help clients hire the right people, then manage and inspire them to achieve maximum business results.

Caldwell Partners' common shares are listed on The Toronto Stock Exchange (TSX: CWL) and trade on the OTCQX Market (OTCQX: CWLPF). Please visit our website at www.caldwellpartners.com for further information.

Forward-Looking Statements

Forward-looking statements in this document are based on current expectations that are subject to the significant risks and uncertainties cited. These forward-looking statements generally can be identified by use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan," "foresee," "may," "will," "likely," "estimates," "potential," "continue" or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements. The Company is subject to many factors that could cause our actual results to differ materially from those contemplated by the relevant forward looking statement including, but not limited to, software that we license from third parties, our ability to successfully recover from a disaster or other business continuity issues, successfully integrating or realizing the expected benefits from our acquisitions, adverse operating issues from acquired businesses, our ability to attract and retain key personnel; exposure to our partners taking our clients with them to another firm; the performance of the US, Canadian and international economies, including the impact of pandemic diseases; competition from other companies directly or indirectly engaged in executive search; liability risk in the services we perform; potential legal liability from clients, employees and candidates for employment; cybersecurity requirements, vulnerabilities, threats and attacks; damage to our brand reputation; our ability to align our cost structure to changes in our revenue; adverse governmental and tax law rulings; our ability to generate sufficient cash flow from operations to support our growth and fund any dividends; technological advances may significantly disrupt the labour market and weaken demand for human capital at a rapid rate; foreign currency exchange rate fluctuations; affiliation agreements may fail to renew or affiliates may be acquired; marketable securities valuation fluctuations; increasing dependence on third parties for the execution of critical functions; volatility of the market price and volume of our common shares; potential impairment of our acquired goodwill and intangible assets; and disruption as a result of actions of certain stockholders or potential acquirers of the Company. For more information on the factors that could affect the outcome of forward-looking statements, refer to the "Risk Factors" section of our Annual Information Form and other public filings (copies of which may be obtained at www.sedar.com). These factors should be considered carefully, and the reader should not place undue reliance on forward-looking statements. Although any forward-looking statements are based on what management currently believes to be reasonable assumptions, we cannot assure readers that actual results, performance or achievements will be consistent with these forward-looking statements, and management's assumptions may prove to be incorrect. Except as required by Canadian securities laws, we do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf; such statements speak only as of the date made. The forward-looking statements included herein are expressly qualified in their entirety by this cautionary language.

For further information, please contact:

Investors:
Chris Beck, CPA, President and Chief Financial Officer
cbeck@caldwellpartners.com
+1 (617) 934-1843

Media:
Caroline Lomot, Director of Marketing
clomot@caldwellpartners.com
+1 (516) 830-3535

THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(in $000s Canadian)

As at

As at

August 31

August 31

2021

2020

Assets

Current assets

Cash and cash equivalents

29,214

14,481

Accounts receivable

23,218

7,316

Income taxes receivable

-

928

Unbilled revenue

4,217

2,430

Prepaid expenses and other assets

2,332

2,553

58,981

27,708

Non-current assets

Restricted cash

2,624

45

Marketable securities

242

71

Advances

506

695

Property and equipment

1,970

2,128

Right-of-use assets

9,549

7,691

Intangible assets

234

-

Goodwill

7,960

1,288

Deferred income taxes

5,067

1,245

Total assets

87,133

40,871

Liabilities

Current liabilities

Accounts payable

4,640

1,764

Compensation payable

36,852

12,812

Income taxes payable

3,007

-

Lease liability

1,868

1,873

Loans Payable

176

-

46,543

16,449

Non-current liabilities

Compensation payable

6,278

734

Lease liability

8,560

6,932

61,381

24,115

Equity attributable to owners of the Company

Share capital

12,157

7,515

Contributed surplus

15,063

15,013

Accumulated other comprehensive income

204

419

Deficit

(1,672

)

(6,191

)

Total equity

25,752

16,756

Total liabilities and equity

87,133

40,871

THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(in $000s Canadian, except per share amounts)

Twelve months ended August 31

2021

20201

Revenues

Professional fees

119,407

56,867

Direct expense reimbursements

359

1,326

119,766

58,193

Cost of sales expenses

Cost of sales

90,621

44,352

Government stimulus grants

(334

)

(2,446

)

Reimbursed direct expenses

359

1,326

90,646

43,232

Gross profit

29,120

14,961

Selling, general and administrative

20,738

11,588

Acquisition-related expenses

2,453

-

Government stimulus grants

-

(393

)

23,191

11,195

Operating profit

5,929

3,766

Finance expenses (income)

Interest expense on lease liability

464

367

Interest expense on loans payable

27

-

Investment (income) loss

(32

)

605

Foreign exchange loss (income)

53

(179

)

Earnings before income tax

5,417

2,973

Income tax expense

898

127

Net earnings for the year attributable to owners of the Company

4,519

2,846

Earnings per share

Basic

$

0.190

$

0.139

Diluted

$

0.186

$

0.139

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS
(in $000s Canadian)

Twelve months ended August 31

2021

2020

Net earnings for the period

4,519

2,846

Other comprehensive income:

Items that may be reclassified subsequently to net earnings

Gain on marketable securities

165

210

Cumulative translation adjustment

(380

)

(372

)

Comprehensive earnings for the year attributable to owners of the Company

4,304

2,684

1 Certain comparative figures have been restated to conform with current year presentation.

THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(in $000s Canadian)

Accumulated Other Comprehensive Income (Loss)

Deficit

Share Capital

Contributed Surplus

Cumulative Translation Adjustment

Gain on Marketable Securities

Total Equity

Balance - August 31, 2019

(9,256

)

7,515

15,005

967

(386

)

13,845

Adoption of IFRS 16

1,137

-

-

-

-

1,137

Net earnings for the year

2,846

-

-

-

-

2,846

Dividend payments declared

(918

)

-

-

-

-

(918

)

Share based payment expense

-

-

8

-

8

Gain on marketable securities available for sale

210

210

Change in cumulative translation adjustment

-

-

-

(372

)

-

(372

)

Balance - August 31, 2020

(6,191

)

7,515

15,013

595

(176

)

16,756

Net earnings for the year

4,519

-

-

-

-

4,519

Common share issuance

-

4,642

-

-

-

4,642

Share-based payment expense

-

-

50

-

-

50

Gain on marketable securities available for sale

-

-

-

-

165

165

Change in cumulative translation adjustment

-

-

-

(380

)

-

(380

)

Balance - August 31, 2021

(1,672

)

12,157

15,063

215

(11

)

25,752

THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOW
(in $000s Canadian)

Twelve months ended August 31

2021

2020

Cash flow provided by (used in)

Operating activities

Net earnings for the year

4,519

2,846

Add (deduct) items not affecting cash

Depreciation of property and equipment

393

461

Depreciation of right-of-use assets

1,982

1,565

Amortization of intangible assets

19

-

Amortization of advances

646

1,128

Interest expense on lease liabilities

464

367

Share based payment expense

50

8

Loss (gain) on unrealized foreign exchange on subsidiary loans13

13

(262

)

Gain on lease modification

(37

)

-

Interest on loans payable

27

-

Gain on government stimulus grants

-

(2,132

)

Loss on disposition of assets

-

103

Loss on disposition of right-of-use assets

-

87

Reduction in lease liability due to early termination

-

(91

)

Fees received in shares

-

(23

)

Loss on marketable securities classified as FVPL

-

625

Decrease in deferred income taxes

-

520

Changes in working capital

16,802

(3,813

)

Net cash provided by operating activities

24,878

1,389

Investing activities

Acquisition of business, net of cash acquired

(3,238

)

-

Payment of advances

(437

)

(576

)

Purchase of property and equipment

(251

)

(1,320

)

Purchase of marketable securities

(180

)

Purchase of intangible assets

(108

)

Sale of marketable securities

289

Tenant inducement on right-of-use assets

-

367

Proceeds from sale of marketable securities

-

5,207

Net cash (used in) provided by investing activities

(3,925

)

3,678

Financing activities

Increase in restricted cash

(2,619

)

-

Payment of lease liabilities

(2,619

)

(2,021

)

Payment of loans payable

(1,043

)

-

Sublease payments received

346

310

Dividend payments

-

(1,377

)

Proceeds from government loan

-

2,267

Net cash used in financing activities

(5,935

)

(821

)

Effect of exchange rate changes on cash and cash equivalents

(284

)

(388

)

Net increase in cash and cash equivalents

14,733

3,858

Cash and cash equivalents, beginning of year

14,481

10,623

Cash and cash equivalents, end of period

29,214

14,481

SOURCE: Caldwell Partners International, Inc.



View source version on accesswire.com:
https://www.accesswire.com/673250/Caldwell-Reports-Strong-Growth-in-Revenue-and-Operating-Profit

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