- Second quarter revenue of $39.8 million, a 66% increase year over year
- Second quarter operating profit of $5.0 million, a new quarterly record
TORONTO, ON / ACCESSWIRE / April 14, 2022 / Talent acquisition firm The Caldwell Partners International Inc. (TSX:CWL) (OTCQX:CWLPF) today issued its financial results for the fiscal 2022 second quarter ended February 28, 2022. 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 | Six Months Ended | |||||||||||||||
| 2.28.22 | 2.28.21 | 2.28.22 | 2.28.21 | |||||||||||||
| Professional fees - Caldwell | 27,258 | 19,724 | 53,850 | 37,777 | ||||||||||||
| Professional fees - IQTP | 12,550 | 4,285 | 24,272 | 4,285 | ||||||||||||
| Consolidated professional fees | 39,808 | 24,009 | 78,122 | 42,062 | ||||||||||||
| Direct expense reimbursements | 135 | 73 | 251 | 147 | ||||||||||||
| Revenues | 39,943 | 24,082 | 78,373 | 42,209 | ||||||||||||
| Cost of sales | 30,271 | 18,079 | 60,703 | 31,416 | ||||||||||||
| Government stimulus grants | - | (156 | ) | - | (266 | ) | ||||||||||
| Reimbursed direct expenses | 135 | 73 | 251 | 147 | ||||||||||||
| Gross profit | 9,537 | 6,086 | 17,419 | 10,912 | ||||||||||||
| Selling, general and administrative expenses | 3,820 | 5,389 | 9,774 | 8,563 | ||||||||||||
| Acquisition-related expenses | 690 | 644 | 1,491 | 869 | ||||||||||||
| Operating profit (loss) | 5,027 | 53 | 6,154 | 1,480 | ||||||||||||
| Interest expense on lease liability | 107 | 120 | 219 | 227 | ||||||||||||
| Interest expense on loans payable | - | 9 | - | 9 | ||||||||||||
| Investment income | (2 | ) | (5 | ) | (7 | ) | (14 | ) | ||||||||
| Foreign exchange loss (gain) | 89 | 71 | (34 | ) | 105 | |||||||||||
| Earnings (loss) before tax | 4,833 | (142 | ) | 5,976 | 1,153 | |||||||||||
| Income tax expense (recovery) | 1,331 | (512 | ) | 1,729 | (151 | ) | ||||||||||
| Net earnings (loss) after tax | 3,502 | 370 | 4,247 | 1,304 | ||||||||||||
| Basic earnings per share | $ | 0.137 | $ | 0.016 | $ | 0.166 | $ | 0.059 | ||||||||
Summary
"This was another record-breaking quarter for Caldwell, delivering the strongest second quarter and first half in Caldwell's history," said John Wallace, chief executive officer. "Consolidated revenue for the quarter was $39.8 million (a 66% increase over the prior year) and $78.4 million for the fiscal year to date (an 86% increase over the prior year). Both business segments showed strong organic growth year over year.
Our Caldwell executive search segment contributed $27.4 million in revenue in the second quarter, a 38% increase over the second quarter of fiscal 2021. Our IQTP segment, which added $12.6 million in revenue during the second quarter, has seen sustained and significant growth in demand for their flexible on-demand resourcing model and innovative use of AI technology. Our consolidated operating profit also hit all-time highs of over $5 million for the quarter, inclusive of acquisition-related costs of $0.7 million."
Wallace continued: "These outstanding results demonstrate that our strategy is clearly resonating with clients and differentiating us in the marketplace. Our recent investment in Skyminyr is the latest example of our mission to implement creative and innovative techniques that allow our clients to leverage technology in the war for talent. By integrating Skyminyr's AI-based candidate search capabilities into our search process over time, we will further strengthen our ability to offer seamless talent acquisition solutions at all levels to our clients. In the immediate, we will continue to drive organic expansion and review acquisition opportunities that align with our client-driven belief that Talent Transforms to further drive growth and shareholder value."
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.caldwell.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
[email protected]
+1 (617) 934-1843
Media:
Caroline Lomot, Director of Marketing
[email protected]
+1 (516) 830-3535
THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED INTERIM STATEMENTS OF FINANCIAL POSITION
(unaudited - in $000s Canadian)
| As at February 28 2022 | As at August 31 2021 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
Cash and cash equivalents | 15,166 | 29,214 | ||||||
Accounts receivable | 25,637 | 23,218 | ||||||
Income taxes receivable | 1,432 | - | ||||||
Unbilled revenue | 7,160 | 4,217 | ||||||
Prepaid expenses and other assets | 2,660 | 2,332 | ||||||
| 52,055 | 58,981 | |||||||
Non-current assets | ||||||||
Restricted cash | 2,641 | 2,624 | ||||||
Investments | 789 | 242 | ||||||
Advances | 397 | 506 | ||||||
Property and equipment | 1,909 | 1,970 | ||||||
Right-of-use assets | 8,709 | 9,549 | ||||||
Intangible assets | 210 | 234 | ||||||
Goodwill | 8,646 | 7,960 | ||||||
Deferred income taxes | 5,091 | 5,067 | ||||||
Total assets | 80,447 | 87,133 | ||||||
Liabilities | ||||||||
Current liabilities | ||||||||
Accounts payable | 3,665 | 4,640 | ||||||
Compensation payable | 35,074 | 36,852 | ||||||
Income taxes payable | - | 3,007 | ||||||
Lease liability | 1,964 | 1,868 | ||||||
Loans Payable | 177 | 176 | ||||||
| 40,880 | 46,543 | |||||||
Non-current liabilities | ||||||||
Compensation payable | 1,687 | 6,278 | ||||||
Lease liability | 7,743 | 8,560 | ||||||
| 50,310 | 61,381 | |||||||
Equity attributable to owners of the Company | ||||||||
Share capital | 12,279 | 12,157 | ||||||
Contributed surplus | 15,050 | 15,063 | ||||||
Accumulated other comprehensive income | 233 | 204 | ||||||
Retained earnings (deficit) | 2,575 | (1,672 | ) | |||||
Total equity | 30,137 | 25,752 | ||||||
Total liabilities and equity | 80,447 | 87,133 | ||||||
THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED INTERIM STATEMENTS OF EARNINGS
(unaudited - in $000s Canadian, except per share amounts)
| Three months ended February 28 | Six months ended February 28 | |||||||||||||||
| 2022 | 20211 | 2022 | 20211 | |||||||||||||
| Revenues | ||||||||||||||||
Professional fees | 39,808 | 24,009 | 78,122 | 42,062 | ||||||||||||
Direct expense reimbursements | 135 | 73 | 251 | 147 | ||||||||||||
| 39,943 | 24,082 | 78,373 | 42,209 | |||||||||||||
Cost of sales expenses | ||||||||||||||||
Cost of sales | 30,271 | 18,079 | 60,703 | 31,416 | ||||||||||||
Government stimulus grants | - | (156 | ) | - | (266 | ) | ||||||||||
Reimbursed direct expenses | 135 | 73 | 251 | 147 | ||||||||||||
| 30,406 | 17,996 | 60,954 | 31,297 | |||||||||||||
Gross profit | 9,537 | 6,086 | 17,419 | 10,912 | ||||||||||||
Selling, general and administrative | 3,820 | 5,389 | 9,774 | 8,563 | ||||||||||||
Acquisition-related expenses | 690 | 644 | 1,491 | 869 | ||||||||||||
| 4,510 | 6,033 | 11,265 | 9,432 | |||||||||||||
Operating profit | 5,027 | 53 | 6,154 | 1,480 | ||||||||||||
Finance expenses (income) | ||||||||||||||||
Interest expense on lease liability | 107 | 120 | 219 | 227 | ||||||||||||
Interest expense on loans payable | - | 9 | - | 9 | ||||||||||||
Investment income | (2 | ) | (5 | ) | (7 | ) | (14 | ) | ||||||||
Foreign exchange loss (income) | 89 | 71 | (34 | ) | 105 | |||||||||||
Earnings (loss) before income tax | 4,833 | (142 | ) | 5,976 | 1,153 | |||||||||||
Income tax expense (recovery) | 1,331 | (512 | ) | 1,729 | (151 | ) | ||||||||||
Net earnings for the year attributable to owners of the Company | 3,502 | 370 | 4,247 | 1,304 | ||||||||||||
Earnings per share | ||||||||||||||||
Basic and Diluted | $ | 0.137 | $ | 0.016 | $ | 0.166 | $ | 0.059 | ||||||||
Diluted | $ | 0.135 | $ | 0.015 | $ | 0.163 | $ | 0.058 | ||||||||
CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE EARNINGS
(unaudited - in $000s Canadian)
| Three months ended February 28 | Six months ended February 28 | |||||||||||||||
| 2022 | 20211 | 2022 | 20211 | |||||||||||||
Net earnings for the period | 3,502 | 370 | 4,247 | 1,304 | ||||||||||||
Other comprehensive income: | ||||||||||||||||
Items that may be reclassified subsequently to net earnings | ||||||||||||||||
(Loss) gain on marketable securities | (66 | ) | 96 | (92 | ) | 133 | ||||||||||
Cumulative translation adjustment | (136 | ) | (257 | ) | 121 | (332 | ) | |||||||||
Comprehensive earnings for the year attributable to owners of the Company | 3,300 | 209 | 4,276 | 1,105 | ||||||||||||
1Certain comparative figures have been restated to conform with current year presentation.
THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY
(unaudited - in $000s Canadian)
| Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||
| Retained Earnings (Deficit) | Share Capital | Contributed Surplus | Cumulative Translation Adjustment | Gain/(loss) on Marketable Securities | Total Equity | |||||||||||||||||||
Balance - August 31, 2020 | (6,191 | ) | 7,515 | 15,013 | 595 | (176 | ) | 16,756 | ||||||||||||||||
Net earnings for the six month period ended | ||||||||||||||||||||||||
February 28, 2022 | 1,304 | - | - | - | - | 1,304 | ||||||||||||||||||
Common share issuance | - | 4,642 | - | - | - | 4,642 | ||||||||||||||||||
Share based payment expense | - | - | 23 | - | - | 23 | ||||||||||||||||||
Gain on marketable securities available for sale | - | - | - | - | 133 | 133 | ||||||||||||||||||
Change in cumulative translation adjustment | - | - | - | (332 | ) | - | (332 | ) | ||||||||||||||||
Balance - February 28, 2021 | (4,887 | ) | 12,157 | 15,036 | 263 | (43 | ) | 22,526 | ||||||||||||||||
Balance - August 31, 2021 | (1,672 | ) | 12,157 | 15,063 | 215 | (11 | ) | 25,752 | ||||||||||||||||
Net earnings for the six month period ended | ||||||||||||||||||||||||
February 28, 2022 | 4,247 | - | - | - | - | 4,247 | ||||||||||||||||||
Employee share option plan share issue | - | 122 | (22 | ) | - | - | 100 | |||||||||||||||||
Share-based payment expense | - | - | 9 | - | - | 9 | ||||||||||||||||||
Loss on marketable securities available for sale | - | - | - | - | (92 | ) | (92 | ) | ||||||||||||||||
Change in cumulative translation adjustment | - | - | - | 121 | - | 121 | ||||||||||||||||||
Balance - February 28, 2022 | 2,575 | 12,279 | 15,050 | 336 | (103 | ) | 30,137 | |||||||||||||||||
THE CALDWELL PARTNERS INTERNATIONAL INC.
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOW
(unaudited - in $000s Canadian)
| Six months ended February 28 | ||||||||
| 2022 | 2021 | |||||||
Cash flow provided by (used in) | ||||||||
Operating activities | ||||||||
Net earnings for the year | 4,247 | 1,304 | ||||||
Add (deduct) items not affecting cash | ||||||||
Depreciation of property and equipment | 176 | 189 | ||||||
Depreciation of right-of-use assets | 1,064 | 924 | ||||||
Amortization of intangible assets | 25 | 12 | ||||||
Amortization of advances | 332 | 319 | ||||||
Interest expense on lease liabilities | 219 | 227 | ||||||
Interest on loans payable | - | 9 | ||||||
Share based payment expense | 9 | 23 | ||||||
(Gain) loss on unrealized foreign exchange on subsidiary loans | (91 | ) | 77 | |||||
Changes in working capital | (18,000 | ) | 1,327 | |||||
Net cash (used in) provided by operating activities | (12,019 | ) | 4,411 | |||||
Investing activities | ||||||||
Acquisition of business, net of cash | (314 | ) | (3,238 | ) | ||||
Investment in convertible promissory note | (629 | ) | - | |||||
Purchase of property and equipment | (113 | ) | (83 | ) | ||||
Payment of advances | (255 | ) | - | |||||
Net cash (used in) provided by investing activities | (1,311 | ) | (3,321 | ) | ||||
Financing activities | ||||||||
Payment of lease liabilities | (1,167 | ) | (1,265 | ) | ||||
Proceeds from share issuance under employee stock option plan | 100 | - | ||||||
Sublease payments received | 29 | 177 | ||||||
Increase in restricted cash | - | (2,619 | ) | |||||
Payment of loans payable | - | (39 | ) | |||||
Net cash used in financing activities | (1,038 | ) | (3,746 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | 320 | (357 | ) | |||||
Net (decrease) increase in cash and cash equivalents | (14,048 | ) | (3,013 | ) | ||||
Cash and cash equivalents, beginning of year | 29,214 | 14,481 | ||||||
Cash and cash equivalents, end of period | 15,166 | 11,468 | ||||||
SOURCE: Caldwell Partners International, Inc.