Press Releases

  • Wednesday, March 18, 2015
    WSP Reports Solid Q4 and Fiscal 2014 Results

    MONTREAL, QUEBEC--(Marketwired - March 18, 2015) - WSP Global Inc. (TSX:WSP) ("WSP" or the "Company") today announced its financial and operating results for the fourth quarter and fiscal year ended December 31, 2014. The fourth quarter results cover the period from September 28, 2014 to December 31, 2014.

    FOURTH QUARTER AND FISCAL 2014 FINANCIAL HIGHLIGHTS

    • For the quarter, revenues and net revenues of $1,158.1 million and $858.8 million, up 118.3% and 96.9%, respectively, mainly as a result of the acquisition of Parsons Brinckerhoff. Global organic growth of 14.4%; 9.1% organic growth on a constant currency basis and 5.3% due to favourable foreign exchange impact.

    • For the year, revenues and net revenues of $2,902.4 million and $2,349.9 million, up 44.0% and 40.1%, respectively, mainly as a result of several acquisitions made during the year. Global organic growth of 10.4%; 4.6% organic growth on a constant currency basis and 5.8% due to favourable foreign exchange impact.

    • EBITDA of $90.1 million for the quarter and $253.5 million for the year, up $40.9 million or 83.1% and $72.9 million or 40.4%, respectively. EBITDA margins at 10.5% and 10.8% of net revenues, for the quarter and fiscal 2014.

    • Net earnings attributable to shareholders, excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes), at $50.8 million, or $0.64 per share for the quarter up 106.5% and 36.2%, respectively; for the year, at $141.7 million, or $2.21 per share up 50.1% and 21.4%, respectively.

    • Backlog at $3,935.1 million representing approximately 8.7 months of revenues, up $2,053.3 million or 109.1% compared to Q3 2014.

    • For fiscal 2014, funds from operations and free cashflow at $134.2 million and $178.9 million, up 8.3% and 96.4%, respectively. Free cash flow stood at 151.6% of net earnings attributable to shareholders before non-underlying items.

    • DSO stood at 77 days, a 9 day improvement compared to prior quarter.

    • Quarterly dividend declared of $0.375 per share, with a 51.6% Dividend Reinvestment Plan ("DRIP") participation.

    • Net debt to trailing twelve month EBITDA ratio at 2.5x; incorporating full 12 month EBITDA for all acquisitions ratio at 1.79x.

    FOURTH QUARTER HIGHLIGHTS

    • On September 3, 2014, the Corporation announced that it had entered into a stock purchase agreement with Balfour Beatty plc and certain of its subsidiaries ("Balfour Beatty") in connection with the acquisition (the "Acquisition") of all of the issued and outstanding capital stock of the entities comprising the business of Parsons Brinckerhoff Group Inc. (collectively, "Parsons Brinckerhoff"), the professional services arm of Balfour Beatty. The acquisition was completed on October 31, 2014 for a consideration of US$1,310.2 million, including cash retained by Parsons Brinckerhoff of US$68.7 million, subject to certain closing and post-closing adjustments.

    • On November 6, 2014, the Corporation made the acquisition of Texas Engineers, Inc. doing business as ccrd, an engineering firm of 200 people headquartered in Houston, Texas.

    • On December 12, 2014, WSP acquired Dessau CEI S.A.S, Dessau's international Inc.'s Colombian engineering subsidiary. The firm has 415 employees and is based in Bogotá.

    • As at December 31, 2014, the Corporation has met, one full year ahead of plan, all financial objectives set out in its 2013-2015 strategic plan.

    "We are pleased by our financial results for the fourth quarter and the full year and thankful to our 32,000 employees around the world for their commitment to our success. Our performance continues to demonstrate the expertise of our team, the strength of our diversified model and our capacity to integrate acquisitions, while still delivering strong top-line and bottom-line results," said Pierre Shoiry, WSP's President and Chief Executive Officer. "Going into 2015, we intend to continue our strong execution, with a focus on integration, organic growth-based performance and continued improvements in our project delivery capabilities. With a solid organizational structure of empowered country and sector leaders, we are confident we have the depth and breadth of talent to implement the agreed upon strategies that will help sustain future growth".

    GUIDANCE FOR 2015

    Management provided guidance on 2015 operating results in the Management's Discussion & Analysis ("MD&A") for the year ended December 31, 2014. The outlook is provided to assist analysts and shareholders in formalizing their respective views on 2015. These measures are subject to change.

    DIVIDEND

    The Board of WSP declared a dividend of $0.375 per share. This dividend will be payable on or about April 15, 2015, to shareholders of record at the close of business on March 31, 2015.

    FINANCIAL REPORT

    This release includes, by reference, our 2014 financial reports, including the audited consolidated financial statements and Management's Discussion and Analysis ("MD&A") of the Company.

    For a copy of our 2014 financial results, including the MD&A and the audited consolidated financial statements, please visit our website at www.wspgroup.com

    CONFERENCE CALL

    WSP will hold a conference call at 4 p.m. (Eastern Time) on March 18, 2015, to discuss these results. The telephone numbers to access the conference call are 1-647-788-4922 or 1-877-223-4471 (toll-free).

    A presentation of the fourth quarter and fiscal 2014 highlights and results will be available on the same day at www.wspgroup.com in the Investors section, under Presentations & Events.

    A replay of the call will be available until March 28, 2015. The telephone numbers to access the replay of the call are 1-416-621-4642 or 1-800-585-8367 (toll-free), access code 66976673. The replay of the conference call will also be available in the Investor section of the WSP website under Presentations & Events, in the days following the call.

    ANALYST AND INVESTOR DAY

    The Corporation also announced that it will be holding an Analyst and Investor Day on June 10, 2015 at the View of the World located in New York, NY (USA). During this event, that will be webcasted live, members of the US senior corporate and operations management teams will provide an overview of the US region, which now represents one of the largest geographical regions of the Corporation. For additional information on the Analyst and Investor Day, please visit our website at www.wspgroup.com.

    RESULTS OF OPERATIONS

    Q4 YTD
    2014 2013 2014 2013
    (in millions of dollars, except number of shares and per share data) For the
    period from
    September 28 to
    December 31
    For the
    period from
    September 29 to
    December 31
    For the
    period from
    January 1 to
    December 31
    For the
    period from
    January 1 to
    December 31
    Revenues $1,158.1 $530.4 $2,902.4 $2,016.0
    Less: Subconsultants and direct costs $299.3 $94.3 $552.5 $338.8
    Net revenues* $858.8 $436.1 $2,349.9 $1,677.2
    Personnel costs $644.8 $321.8 $1,762.8 $1,244.2
    Other operational costs(1) $126.6 $67.6 $344.2 $261.5
    Share of earnings of associates ($2.7 ) ($2.5 ) ($10.6 ) ($9.1 )
    EBITDA* $90.1 $49.2 $253.5 $180.6
    Non-underlying items* $61.8 $4.3 $69.8 $9.5
    Amortization of intangible assets $15.8 $8.7 $43.7 $34.0
    Depreciation of property, plant and equipment $12.1 $6.4 $33.8 $24.7
    Financial expenses $5.1 $4.1 $13.8 $15.1
    Share of depreciation of associates $0.6 $0.5 $2.4 $2.7
    Earnings (loss) before income taxes $(5.3 ) $25.2 $90.0 $94.6
    Income tax expenses $1.7 $6.9 $25.3 $22.3
    Share of tax of associates $0.6 $0.7 $2.5 $2.1
    Net earnings (loss) $(7.6 ) $17.6 $62.2 $70.2
    Attributable to:
    - Shareholders $(7.9 ) $17.9 $62.8 $71.7
    - Non-controlling interests $0.3 $(0.3 ) $(0.6 ) $(1.5 )
    Basic net earnings (loss) per share ($0.10 ) $0.34 $0.98 $1.38
    Diluted net earnings (loss) per share ($0.10 ) $0.34 $0.98 $1.38
    Basic weighted average number of shares 79,109,987 52,322,916 64,023,625 51,843,140
    Diluted weighted average number of shares 79,110,481 52,322,916 64,023,625 51,843,140
    * Non-IFRS measures as described in the 'Glossary' section.
    (1) The Other operational costs include operation exchange loss or gain and interest income.

    NON-IFRS MESURES

    The Corporation reports its financial results in accordance to IFRS. However, the following non-IFRS measures are used by the Corporation: net revenues; EBITDA; EBITDA margin; adjusted EBITDA; adjusted EBITDA margin; net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes); net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes) per share; backlog; funds from operations; funds from operations per share; free cash flow; free cash flow per share; days sales outstanding ("DSO") and net debt to EBITDA.

    Management believes that these non-IFRS measures provide useful information to investors regarding the Corporation's financial condition and results of operations as they provide key metrics of its performance. These non-IFRS measures do not have any standardized meaning prescribed under IFRS and may differ from similar computations as reported by other issuers, and accordingly may not be comparable. These measures should not be viewed as a substitute for the related financial information prepared in accordance with IFRS.

    Net revenues

    Net revenues are defined as revenues less direct costs for subconsultants and other direct expenses that are recoverable directly from the clients. Net revenues are not an IFRS measure and do not have a standardized definition within IFRS. Therefore, net revenues may not be comparable to similar measures presented by other issuers. Investors are advised that net revenues should not be construed as an alternative to revenues for the period (as determined in accordance with IFRS) as an indicator of the Corporation's performance.

    EBITDA

    EBITDA is defined as earnings before non-underlying items, financial expenses, income tax expenses, depreciation and amortization. EBITDA is not an IFRS measure and does not have a standardized definition within IFRS. Investors are cautioned that EBITDA should not be considered an alternative to net earnings for the period (as determined in accordance with IFRS) as an indicator of the Corporation's performance, or an alternative to cash flows from operating, financing and investing activities as a measure of the liquidity and cash flows. The Corporation's method of calculating EBITDA may differ from the methods used by other issuers and, accordingly, the Corporation's EBITDA may not be comparable to similar measures used by other issuers.

    EBITDA margin

    EBITDA margin is defined as EBITDA expressed as a percentage of net revenues. EBITDA margin is not an IFRS measure.

    Adjusted EBITDA

    Adjusted EBITDA is defined as EBITDA excluding global corporate costs. Global corporate costs are expenses and salaries related to centralized functions, such as global Finance, Human Resources and Technology teams, which are not allocated to operating segments. This measure is not an IFRS measure. It provides Management with comparability from one region to the other.

    Adjusted EBITDA margin

    Adjusted EBITDA margin is defined as adjusted EBITDA expressed as a percentage of net revenues. Adjusted EBITDA margin is not an IFRS measure.

    Net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes) and net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes) per share

    Net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes) is not an IFRS measure. It provides a comparative measure of Corporation performance in a context of significant business combinations. This measure is defined as net earnings (loss) attributable to shareholders excluding non-underlying items and the amortization expense of backlogs, customer relationships, non-competition agreements and trade names accounted for in business combinations and the income tax effects related to this amortization.

    Net earnings (loss) excluding non-underlying items and amortization of intangible assets related to acquisitions (net of income taxes) per share is calculated using the basic weighted average number of shares.

    Non-underlying items

    Non-underlying items is not an IFRS measure. Non-underlying items are items of financial performance which the Corporation believes should be excluded in understanding the underlying financial performance achieved by Corporation. Non-underlying items include transaction and integration costs related to business acquisitions as well as costs of restructuring and reorganizing existing operations.

    Backlog

    Backlog is not an IFRS measure. It represents future revenues stemming from existing signed contracts to be completed. The Corporation's method of calculating backlog may differ from the methods used by other issuers and, accordingly, may not be comparable to similar measures used by other issuers.

    Funds from operations and funds from operations per share

    Funds from operations is not an IFRS measure. It provides Management and investors with a proxy for the amount of cash generated from (used in) operating activities before changes in non-cash working capital items.

    Funds from operations per share is calculated using the basic weighted average number of shares.

    Free cash flow and free cash flow per share

    Free cash flow is not an IFRS measure. It provides a consistent and comparable measurement of free cash flow generated from operations and is used as an indicator of financial strength and performance. Free cash flow is defined as cash flows from operating activities as reported in accordance with IFRS, less capital expenditures.

    Free cash flow per share is calculated using the basic weighted average number of shares.

    Days Sales Outstanding ("DSO")

    DSO is not an IFRS measure. It represents the average number of days to convert our trade receivables and costs and anticipated profits in excess of billings into cash, net of sales taxes. The Corporation's method of calculating DSO may differ from the methods used by other issuers and, accordingly, may not be comparable to similar measures used by other issuers.

    Net debt to EBITDA

    Net Debt to EBITDA is not an IFRS measure. It is a measure of our level of financial leverage net of our cash and cash equivalents and is calculated on our trailing twelve month EBITDA.

    ABOUT WSP

    WSP, through its acquisition of Parsons Brinckerhoff, is one of the world's leading professional services firms in its industry, working with governments, businesses, architects and planners and providing integrated solutions across many disciplines. The firm provides services to transform the built environment and restore the natural environment, and its expertise ranges from environmental remediation to urban planning, from engineering iconic buildings to designing sustainable transport networks, and from developing the energy sources of the future to enabling new ways of extracting essential resources. It has approximately 32,000 employees, including engineers, technicians, scientists, architects, planners, surveyors environmental specialists, as well as other design, program and construction management professionals, based in more than 500 offices, across 39 countries, on 5 continents. www.wspgroup.com

    Forward-looking statements

    Certain information regarding WSP contained herein may constitute forward-looking statements. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although WSP believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. WSP's forward-looking statements are expressly qualified in their entirety by this cautionary statement. The complete version of the cautionary note regarding forward-looking statements as well as a description of the relevant assumptions and risk factors likely to affect WSP's actual or projected results are included in the Management Discussion and Analysis for the fourth quarter and year ended December 31, 2014, which are available on SEDAR at www.sedar.com. The forward-looking statements contained in this press release are made as of the date hereof and WSP does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise unless expressly required by applicable securities laws.

    Alexandre L'Heureux
    Chief Financial Officer
    WSP Global Inc.
    514-340-0046, ext. 5310
    alexandre.lheureux@wspgroup.com

    Isabelle Adjahi
    Vice President, Investor Relations
    and Corporate Communications
    WSP Global Inc.
    514-340-0046, ext. 5648
    isabelle.adjahi@wspgroup.com