Press Releases

  • Tuesday, March 23, 2010
    GENIVAR Income Fund Announces Fourth-Quarter and Full-Year Financial Results for 2009

    MONTREAL, March 23 - The GENIVAR Income Fund (the "Fund") released its 2009 fourth-quarter results today, together with the full-year results for the period from January 1, 2009, to December 31, 2009.

    Highlights
        ----------
    
        - For the full year 2009, revenues grew from $387.8 million in 2008 to
          $477.9 million, representing a 23.2% increase compared with 2008. Net
          revenues were $395.3 million, up 23.5% from $320.1 million in 2008. Of
          the total 23.5% increase in net revenues, 14.0% came from the
          acquisitions completed in 2008 and 2009 and the remaining 9.5% was
          achieved through organic growth.
    
        - For the fourth quarter of 2009, revenues rose to $135.0 million, up
          from $115.7 million, representing an increase of 16.7%. Net revenues
          were $108.7 million, compared with $93.3 million, an increase of 16.6%
          compared with 2008. Organic growth accounted for 6.2% of the 16.6%
          increase in net revenues, with the remaining 10.4% resulting from
          acquisitions.
    
        - EBITDA for the full year 2009 increased by 14.5% to $78.6 million or
          19.9% of net revenues, compared with $68.6 million or 21.4% of net
          revenues for the full year 2008. Without the negative impact of the
          exchange loss of $3.3 million registered in 2009, EBITDA would have
          increased by 23.4% to $81.9 million.
    
        - EBITDA increased from $19.6 million in the fourth quarter of 2008 to
          $21.0 million for the same period in 2009. The fourth-quarter results
          were negatively impacted by an exchange loss of $1.4 million as a
          result of the stronger Canadian dollar.
    
        - Earnings before non-controlling interest were $50.1 million or $2.06
          per unit, up from $42.5 million, or $1.95 per unit, in 2008. In the
          fourth quarter, earnings before non-controlling interest were $12.6
          million or $0.47 per unit, compared with $10.2 million or $0.44 per
          unit for the same period in 2008.
    
        - In 2009, the Fund generated adjustable distributable cash of $61.7
          million or $2.56 per unit, of which $48.7 million was distributed to
          unitholders, representing annual distributions of $1.95 per unit and an
          adjusted payout ratio of 78.9%.
    
        - As at December 31, 2009, backlog remained steady at $355.6 million,
          representing 8.6 months of work.
    
        - In 2009, the Fund added approximately 500 employees to its platform, of
          which about two-thirds came from the 12 acquisitions completed in
          Canada and the one completed in Trinidad and Tobago during the year. In
          addition, international net revenues also increased by 24.9% in 2009,
          compared with 2008.
    
        - Subsequent to the year-end, the Fund completed two acquisitions in
          Ontario, boosting the total staff in that province to more than 1,000
          employees.

    "Despite a challenging economy in 2009, we are pleased with our overall performance which demonstrates the resilience of our business model and the advantages of scale as well as geographic and market diversification," said Pierre Shoiry, President and Chief Executive Officer of the GENIVAR Income Fund. "We are grateful to our almost 6,000 clients for their continued support and to our committed staff who provide them with innovative and cost-effective solutions and quality service on projects of varying size and scope."

    Formation of a special committee

    The Fund has formed a special committee of independent trustees to analyze the opportunity to convert the Fund into a corporation. The special committee is expected to make a formal recommendation to the Board of the Fund before the end of April 2010, and a press release will be issued by the Fund once the Board has made a decision.

    Conference call
        ---------------

    The Fund will hold a conference call at 4 p.m. (Eastern time) on March 23, 2010, to discuss these results.

    To participate in the conference call:
        Montreal and International, please dial 514-807-9895
        Elsewhere in Canada and United States, please dial 1-888-231-8191
        Conference number: 60928017

    A presentation of the 2009 fourth quarter highlights and results will be available on the same day at: www.genivar.com in the Investor Relations section, under Presentations and events.

    The replay of the conference call will also be available in the Investor Relations section of the Company's web site in the days following the event.

    About GENIVAR
        -------------

    GENIVAR is a leading Canadian consulting engineering firm providing private and public-sector clients with a comprehensive range of professional services covering all project phases, including planning, design, construction and maintenance. GENIVAR's clients range in size and scope and primarily operate in the building, industrial, power, municipal infrastructure, transportation and environmental sectors. GENIVAR is one of Canada's largest consulting engineering firms in terms of number of employees, with over 4,100 managers, professionals, technicians, technologists and support staff in more than 80 locations in Canada and abroad. www.genivar.com

    RESULTS OF OPERATIONS
    
                          -------------------------------------------------------
                                       3 months                    12 months
                          -------------------------------------------------------
                                  2009          2008          2009          2008
                          -------------------------------------------------------
                               FOR THE       FOR THE       FOR THE       FOR THE
                           PERIOD FROM   PERIOD FROM   PERIOD FROM   PERIOD FROM
                          SEPTEMBER 27  SEPTEMBER 28     JANUARY 1     JANUARY 1
        IN THOUSANDS OF             TO            TO            TO            TO
         DOLLARS EXCEPT    DECEMBER 31   DECEMBER 31   DECEMBER 31   DECEMBER 31
         PER UNIT DATA      (UNAUDITED)   (UNAUDITED)  (AUDITED*)  (AUDITED*)
        -------------------------------------------------------------------------
        Revenues             $ 135,022     $ 115,718     $ 477,924     $ 387,803
    
        Deduct: Subcon-
         sultants and
         other direct
         expenses             $ 26,314      $ 22,455      $ 82,597      $ 67,709
    
        Net revenues         $ 108,708      $ 93,263     $ 395,327     $ 320,094
    
        Direct project
         costs                $ 54,911      $ 45,353     $ 196,644     $ 157,986
        -------------------------------------------------------------------------
        Gross margin          $ 53,797      $ 47,910     $ 198,683     $ 162,108
    
        Marketing,
         general, and
         administrative
         expenses and
         others               $ 32,845      $ 28,312     $ 120,114      $ 93,499
        -------------------------------------------------------------------------
        EBITDA                $ 20,952      $ 19,598      $ 78,569      $ 68,609
        -------------------------------------------------------------------------
        Interest                 $ 386         $ 850       $ 1,898       $ 2,341
    
        Depreciation of
         property, plant
         and equipment         $ 1,676       $ 1,647       $ 6,287       $ 4,705
    
        Amortization of
         intangible assets     $ 4,719       $ 5,486      $ 17,036      $ 16,527
        -------------------------------------------------------------------------
        Earnings before
         income taxes
         and non-contro-
         lling interest       $ 14,171      $ 11,615      $ 53,348      $ 45,036
    
        Income taxes           $ 1,556       $ 1,434       $ 3,281       $ 2,518
        -------------------------------------------------------------------------
        Earnings before
         non-controlling
         interest             $ 12,615      $ 10,181      $ 50,067      $ 42,518
    
        Non-controlling
         interest              $ 4,424       $ 3,955      $ 18,974      $ 16,703
        -------------------------------------------------------------------------
        Net earnings           $ 8,191       $ 6,226      $ 31,093      $ 25,815
    
        Basic net earnings
         per unit               $ 0.47        $ 0.44        $ 2.06        $ 1.95
    
        Weighted average
         number of units    17,297,253    14,192,428    15,071,186    13,213,513
    
        Diluted net
         earnings per unit      $ 0.47        $ 0.44        $ 2.06        $ 1.95
    
        Diluted weighted
         average number
         of units           26,357,640    23,224,760    24,131,573    21,829,087
        -------------------------------------------------------------------------
        * Except for Non-GAAP measures.
    
    
        DISTRIBUTABLE CASH
    
                          -------------------------------------------------------
                                       3 months                    12 months
                          -------------------------------------------------------
                                  2009          2008          2009          2008
                          -------------------------------------------------------
                               FOR THE       FOR THE       FOR THE       FOR THE
                           PERIOD FROM   PERIOD FROM   PERIOD FROM   PERIOD FROM
                          SEPTEMBER 27  SEPTEMBER 28     JANUARY 1     JANUARY 1
        IN THOUSANDS OF             TO            TO            TO            TO
         DOLLARS EXCEPT    DECEMBER 31   DECEMBER 31   DECEMBER 31   DECEMBER 31
         PER UNIT DATA      (UNAUDITED)   (UNAUDITED)  (AUDITED*)  (AUDITED*)
        -------------------------------------------------------------------------
        Cash flows from
         operating
         activities           $ 35,703      $ 14,069      $ 52,581      $ 38,322
    
        Capital
         expenditures
         paid                 ($ 3,868)     ($ 3,748)    ($ 12,787)    ($ 10,438)
    
        Standardized
         distributable
         cash                 $ 31,835      $ 10,321      $ 39,794      $ 27,884
    
        Change in non-cash
         working capital
         items(2)            ($ 16,473)      $ 3,433      $ 20,397      $ 24,988
    
        Capital
         expenditures
         paid for UNISON
         project(1)            $ 1,531             -       $ 1,531             -
    
        Adjusted
         distributable
         cash                 $ 16,893      $ 13,754      $ 61,704      $ 52,872
    
        Adjusted
         distributable
         cash,
         per unit(3)            $ 0.64        $ 0.59        $ 2.56        $ 2.26
    
        Payout ratio
    
          Standardized            70.4%        186.7%        122.3%        136.1%
          Adjusted               132.7%        140.1%         78.9%         71.8%
        -------------------------------------------------------------------------
        Distributions
    
        Fund's units
         distributions        $ 14,935      $ 11,793      $ 31,016      $ 23,080
    
        Class B
         Exchangeable
         LP Unit
         distributions         $ 3,571       $ 3,571       $ 8,441       $ 6,836
    
        Class C
         Exchangeable
         LP Unit
         distributions         $ 3,904       $ 3,904       $ 9,227       $ 8,043
    
        Aggregate
         distributions,
         all units            $ 22,410      $ 19,268      $ 48,684      $ 37,959
    
        Aggregate
         distributions,
         all units, per
         unit(4)                $ 0.83        $ 0.83        $ 1.95        $ 1.70
        -------------------------------------------------------------------------
        * Except for Non-GAAP measures.
    
        (1) The Fund is working towards the implementation of a new information
            management system called the UNISON project. Costs incurred for this
            project are non-recurrent and therefore are removed from the
            calculation of the Adjusted distributable cash.
        (2) Distributions are based on actual historical and estimated future
            performance of the Fund on a full-year basis. Consequently, periodic
            fluctuations in non-cash working capital are not considered when
            evaluating the cash flows available for distribution.
        (3) Distributable cash per unit is calculated using the diluted weighted
            average number of units.
        (4) Distributions declared per unit represent the annual distributions
            declared. Distributions declared per unit, calculated using the
            diluted weighted average number of units, were $1.98 per unit for the
            year.

    NON-GAAP MEASURES

    The Fund uses Non-GAAP measures that are used by Canadian open-ended income funds as indicators of financial performance measures which are not recognized under GAAP and may differ from similar computations as reported by other similar entities and, accordingly, may not be comparable. The Fund believes these measures are useful supplemental measures that may assist investors in assessing an investment in units.

    Non-GAAP measures used by the Fund are Net revenues, EBITDA, Distributable cash, and Payout ratio.

    Net revenues

    Net revenues are defined as revenues from consulting services less direct costs for subconsultants and other direct expenses that are recoverable directly from the clients. Net revenues are not a measure in accordance with GAAP and do not have standardized meaning prescribed by GAAP. Therefore, net revenues may not be comparable to similar measures presented by other issuers. Investors are cautioned that net revenues should not be construed as an alternative to revenues for the year (as determined in accordance with GAAP), as an indicator of the Fund's performance.

    EBITDA

    EBITDA is defined as earnings before interest, tax, depreciation and amortization. EBITDA is not an earnings measure in accordance with GAAP and does not have a standardized meaning prescribed by GAAP. Investors are cautioned that EBITDA should not be construed as an alternative to net earnings for the year (as determined in accordance with GAAP) as an indicator of the Fund's performance, or as an alternative to cash flows from operating, financing and investing activities as a measure of the Fund's liquidity and cash flows. The Fund's method of calculating EBITDA may differ from the methods used by other issuers and, accordingly, the Fund's EBITDA may not be comparable to similar measures used by other issuers.

    Distributable cash

    The Fund views distributable cash as an operating performance measure and it is a non-GAAP measure generally used by Canadian income funds as an indicator of financial performance.

    Distributable cash is calculated in accordance with the recommendations provided in CICA's publication "Standardized Distributable Cash in Income Trusts and Other Flow-Through Entities." Standardized distributable cash is defined as cash flows from operating activities as reported in the GAAP financial statements, including the effects of changes in non-cash working capital items and any operating cash flows provided from or used in discontinued operations, less adjustments for:

    (a) total capital expenditures as reported in the GAAP financial
            statements; and
        (b) restrictions on distributions arising from compliance with financial
            covenants restrictive at the date of the calculation of standardized
            distributable cash and limitations arising from the existence of a
            minority interest in a subsidiary.

    The Fund also calculated an adjusted distributable cash, which is defined as standardized distributable cash adjusted for entity-specific adjustment items that management believes are appropriate for the determination of levels of distributions.

    Payout ratio

    Standardized payout ratio is defined as aggregate cash distributions divided by standardized distributable cash. Adjusted payout ratio is defined as aggregate cash distributions divided by adjusted distributable cash.

    Pierre Shoiry, President and CEO, GENIVAR Income Fund, (514) 340-0046, ext. 5104; Marlene Casciaro, Director of Communications, GENIVAR Income Fund, (514) 340-0046, ext. 5184