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The Caldwell Partners International Issues Fiscal 2014 First Quarter Financial Results

  • Year-over-year first quarter revenue increase of 39%.
  • First quarter operating income is $408K.
  • Board declares 1.75 cent quarterly dividend.

TORONTO, Jan. 8, 2014 /PRNewswire/ - Retained executive search firm The Caldwell Partners International Inc. (TSX: CWL) today issued its financial results for the fiscal 2014 first quarter ended November 30, 2013. All references to quarters or years are for the fiscal periods unless otherwise noted and all currency amounts are in Canadian dollars.

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

   Three Months Ended 
November 30
  2014 2013
Operating revenue 10,339 7,417
Expenses 9,931 7,469
Operating profit/loss 408 (52)
Investment income 1 3
Net profit/loss before tax  409 (50)
Net profit/loss after tax 393 (56)
Net profit/loss per share $0.023 ($0.03)

"We are encouraged by the strengthening booking activity and trend over the last half year, and pleased with the solid start to the fiscal year," said John N. Wallace, chief executive officer. "While we still expect some volatility from quarter to quarter based on our size, we remain confident regarding the long-term prospects for executive search. We will continue to seek out and make calculated investments in the firm to grow it in terms of both revenue and sustainable profitability, focusing on improving our overall market and industry sector presence with targeted, strategic additions to the team when and where it makes financial sense."

Wallace continued: "The near unanimous participation of the Partner team in the recently announced private placement of approximately 4.0 million common shares of the Corporation bodes well for the long-term commitment that our people have to the organization and its ongoing growth and success."

The Board of Directors today also declared the payment of a quarterly dividend of 1.75 cents per Common Share payable March 14, 2014 to shareholders of record on January 20, 2014.

Financial Overview (all numbers expressed in $000s)

  • Operating revenue:
    • Fiscal 2014 first quarter operating revenue increased by 39% over the comparable period last year to $10,339 (2013: $7,417).

    • US revenues increased 46% (39% excluding an 8% favourable variance from exchange rate fluctuations) to $6,543 in the comparable period of 2013, driven primarily by increased search volumes, partially offset by fewer average partners during the current year.

    • Revenues from Canadian operations increased 29% to $3,795 in the current period, generated by higher average fees on consistent search volumes and number of partners.
  • Operating profit:
    • Higher year-over-year first quarter revenues ($2,922) partially offset by the related higher cost of sales ($2,134) and expenses ($327) resulted in the net increase of $460 to an operating profit of $408 in the first quarter of fiscal 2014 from an operating loss of $52 in the first quarter of fiscal 2013.
  • Net profit:
    • The first quarter net earnings were $393 ($0.023 per share) in fiscal 2014, as compared to a net loss of $56 ($0.003 per share) in the comparable period a year earlier.

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

About Caldwell Partners

Caldwell Partners is one of North America's premier providers of executive search and has been for 40 years. As one of the region's most trusted advisors in executive search, the firm has a sterling reputation built on successful searches for boards, chief and senior executives, and selected functional experts.

With offices and partners in Vancouver, San Francisco, Los Angeles, Dallas, Calgary, Atlanta, Toronto, Stamford, New York City, and a strategic presence in London and Hong Kong, the firm takes pride in delivering an unmatched level of service and expertise to its clients.

Caldwell Partners' Common shares are listed on The Toronto Stock Exchange (TSX: CWL). 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 significant risks and uncertainties. Actual results might differ materially due to various factors such as the competitive nature of the executive search industry, the ability of the company to execute its growth strategies, the performance of the Canadian domestic and international economies, and the company's ability to retain key personnel. The Caldwell Partners assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward-looking statements.

                 
THE CALDWELL PARTNERS INTERNATIONAL INC.                  
                     
CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION                
(unaudited - in $Canadian)                    
        As at
        November 30       August 31
        2013       2013
Assets                        
Current assets                      
  Cash and cash equivalents           9,573,745       7,612,957
  Marketable securities           3,631,313       3,576,811
  Accounts receivable           5,154,535       7,088,555
  Prepaid expenses and other current assets       895,840       1,060,998
        19,255,433       19,339,321
Non-current assets                      
  Restricted cash       255,381       255,012
  Advances       240,238       292,035
  Property and equipment        1,335,448       1,360,646
  Intangible assets        432,453       447,434
  Goodwill        1,048,811       1,039,922
Total assets         22,567,764       22,734,370
                         
Liabilities                        
Current liabilities                        
  Accounts payable        1,132,879       1,345,146
  Compensation payable       9,237,091       9,156,182
  Dividends payable       298,736       255,983
  Taxes payable       29,474       13,741
  Deferrred revenue       1,080,485       1,357,718
        11,778,665       12,128,770
                         
Non-current liabilities                      
  Non-current severance accrual        96,250       148,750
  Long-term incentive accrual       282,036       231,231
        12,156,951       12,508,751
                         
Equity attributable to owners of the Company                  
  Share capital       4,080,020       4,080,020
  Contributed surplus       16,249,397       16,247,987
  Accumulated other comprehensive income       670,348       580,959
  Deficit       (10,588,952)       (10,683,347)
Total equity         10,410,813       10,225,619
Total liabilities and equity         22,567,764       22,734,370

 

               
THE CALDWELL PARTNERS INTERNATIONAL INC.              
               
CONSOLIDATED INTERIM STATEMENTS OF LOSS              
(unaudited - in $Canadian)                      
        Three months ended
        November 30
          2013     2012
                             
Revenues         10,338,549     7,417,211
                             
Cost of sales         7,754,163     5,620,120
Gross profit         2,584,386     1,797,091
                             
Expenses                          
  General and administrative       2,023,965     1,709,714
  Sales and marketing       160,653     126,957
  Foreign exchange (gain) loss       (7,872)     12,859
          2,176,746     1,849,530
Operating profit (loss)         407,640     (52,439)
                             
Investment income         1,425     2,523
Earnings (loss) before income taxes         409,065     (49,916)
                             
Income tax         15,933     6,105
                             
Net earnings (loss) for the period attribtuable to owners of the Company         393,132     (56,021)
                               
Earnings (loss) per share:                      
  Basic and diluted       0.023     (0.003)
                             
                             
CONSOLIDATED INTERIM STATEMENTS OF               
COMPREHENSIVE LOSS              
(unaudited - in $Canadian)                      
        Three months ended
        November 30
          2013     2012
                           
Net earnings (loss) for the period         393,132     (56,021)
                             
Other comprehensive income:                      
  Unrealized gain on marketable securities (net of tax - $0)       54,502     97,529
  Cumulative translation adjustment (net of tax - $0)       34,887     20,437
Comprehensive earnings for the period attributable to owners of the Company         482,521     61,945

 

                     
THE CALDWELL PARTNERS INTERNATIONAL INC.                    
                     
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOW                    
(unaudited - in $Canadian)                              
            Three months ended
            November 30
                2013       2012
                     
Cash flow provided by (used in)                    
                     
Operating activities                                
  Net earnings (loss) for the period             393,132       (56,021)
  Adjustments for:                              
    Depreciation           78,291       91,327
    Amortization           18,414       17,486
    Share-based payment expense           1,410       8,604
    Unrealized foreign exchange on subsidiary loans           (16,286)       (14,928)
    Non-cash incentive compensation           50,805       42,906
    Deferred revenue           (279,814)       -
    Decrease in long-term incentive accrual           (52,500)       -
  Changes in items of working capital                            
    Decrease in accounts receivable           1,935,004       375,569
    Decrease in income taxes receivable           -       750
    Decrease in prepaid expenses and other assets           168,024       7,097
    Decrease in accounts payable            (216,809)       (555,827)
    Increase (decrease) in compensation payable           43,891       (802,086)
    Increase in dividends payable           42,753       -
    Increase in taxes payable           15,760       -
Net cash provided by (used in) operating activities               2,182,075       (885,123)
                     
Investing activities                                
  Decrease in advances             53,625       53,912
  Increase in restricted cash             (369)       (601)
  Additions to property and equipment             (49,070)       (28,926)
Net cash provided by investing activities               4,186       24,385
                                     
Financing activities                                
  Dividend payments             (298,737)       (254,782)
  Share issuance from employee stock option plan             -       44,800
Net cash used in financing activities               (298,737)       (209,982)
                                     
Effect of exchange rate changes on cash and cash equivalents             73,264       32,563
Net increase (decrease) in cash and cash equivalents               1,960,788       (1,038,157)
Cash and cash equivalents, beginning of period               7,612,957       6,494,246
Cash and cash equivalents, end of period               9,573,745       5,456,089

 

                               
THE CALDWELL PARTNERS INTERNATIONAL INC.
                               
CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY
(unaudited - in $Canadian)                              
                      Accumulated Other Comprehensive        
                      Income (Loss)      
                        Unrealized      
                      Cumulative  Gains on      
                    Contributed Translation Marketable     Total
        Deficit     Capital Stock     Surplus Adjustment Securities     Equity
                               
Balance - September 1, 2012       (9,377,513)     4,016,020     16,245,848 (284,523) 406,815     11,006,647
                               
Net loss for the three month period ended                               
  November 30, 2012       (56,021)     -     - - -     (56,021)
                               
Dividend payments declared       (255,983)     -     - - -     (255,983)
                               
Employee stock option plan share issue       -     64,000     (14,776) - -     49,224
                               
Share-based payment expense       -     -     4,180 - -     4,180
                               
Change in unrealized gains on marketable                              
  securities available for sale        -     -     - - 97,529     97,529
                               
Change in cumulative translation adjustment       -     -     - 20,437 -     20,437
                               
Balance - November 30, 2012       (9,689,517)     4,080,020     16,235,252 (264,086) 504,344     10,866,013
                               
Balance - September 1, 2013       (10,683,347)     4,080,020     16,247,987 (99,623) 680,582     10,225,619
                               
Net earnings for the three month period ended                               
  November 30, 2013       393,132     -     - - -     393,132
                               
Dividend payments declared       (298,737)     -     - - -     (298,737)
                               
Share-based payment expense       -     -     1,410 - -     1,410
                               
Change in unrealized gain on                              
  marketable securities available for sale        -     -     - - 54,502     54,502
                               
Change in cumulative translation adjustment       -     -     - 34,887 -     34,887
                               
Balance - November 30, 2013       (10,588,952)     4,080,020     16,249,397 (64,736) 735,084     10,410,813

 

 

SOURCE The Caldwell Partners International Inc.

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