2014

The Caldwell Partners International Issues Fiscal 2013 Second Quarter Financial Results

  • Revenue decline of 5% second quarter 2013 compared to 2012
  • Board declares 1.5 cent quarterly dividend

TORONTO, April 11, 2013 /PRNewswire/ - Retained executive search firm The Caldwell Partners International Inc. (TSX: CWL) today issued its financial results for the fiscal 2013 second quarter ended February 28, 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)

  Three Months Ended
February 28
Six Months Ended
February 28  
  2013 2012 2013 2012
Operating revenue 6,825 7,221 14,242 14,490
Expenses 7,484 7,467 14,953 15,137
Operating loss (659) (246) (711) (647)
Investment income 7 7 9 9
Net loss before tax (652) (239) (702) (638)
Net loss after tax (653) (241) (709) (686)
Net loss per share (0.038) (0.014) (0.042) (0.040)

"We are disappointed with the operating revenue results this past quarter. Lower search volumes per partner in the United States were the main contributor to the reduced revenue, and while the overall business climate remains challenging - particularly in the United States - we are encouraged by increasing business development activity in many of our key sectors, including financial services" said John N. Wallace, chief executive officer. "We have also made some important additions to our partner team with the recent hiring of John Wasley (Los Angeles), Dave Winston (Dallas), Sean McLean (Calgary) and Mike Gooley (Toronto), all of whom we expect to contribute significantly to our second half revenues. We will continue to add select hires of high calibre partners in key sectors and practices to enhance our market presence and competitiveness."

The Board of Directors today also declared the payment of a quarterly dividend of 1.5 cents per Common Share payable on June 14, 2013 to shareholders of record on April 22, 2013.

Financial Overview (all numbers expressed in $000s)

  • Operating revenue:
    • Fiscal 2013 second quarter revenue decreased by 5% over the comparable period last year to $6,825. The revenue declines were due to lower search volumes.
      • US revenues represented 66% or $4,522 of the second quarter total of fiscal 2013, which decreased 7% from $4,870 in the comparable period of 2012.

      • Canadian revenues represented 34% or $2,303 of the second quarter total of fiscal 2013, which decreased 2% from $2,351 in the comparable period of 2012.
    • Year-to-date revenues decreased 2% over the same period a year earlier to $14,242, due to the second quarter revenue decline.
  • Operating loss
    • The operating loss increased to $659 for the quarter (2012: loss of $246), driven by the decline in revenue. Overall expenses remained consistent, as lower compensation expense from the revenue decline was offset by higher costs from Canada's CEO of the Year event and an increase in management long-term incentive compensation, which resulted from the rising stock price during the quarter.

    • The fiscal 2013 year-to-date operating loss increased to $711 (2012: loss of 647).
  • Net loss:
    • The second quarter net loss was $653 ($0.038 per share) in fiscal 2013, as compared to $241 ($0.014 per share) in the comparable period a year earlier.

    • The year-to-date net loss after tax was $709 ($0.041 per share) in fiscal 2013 versus a loss of $686 ($0.039 per share) in the comparable period a year earlier.

At the end of the second quarter of fiscal 2013, Caldwell Partners had 34 partners located in six American and three Canadian offices, and strategic alliances with executive search firms based in London and Hong Kong.

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 As at
                  February 28 August 31
                  2013 2012
Assets                  
Current assets                
  Cash and cash-equivalents           2,260,822 6,494,246
  Marketable securities           3,512,183 3,303,044
  Accounts receivable           6,251,215 6,122,577
  Income taxes receivable           46,914 49,501
  Prepaid expenses and other assets         1,002,647 775,572
                  13,073,781 16,744,940
Non-current assets                
  Restricted cash             253,539 252,966
  Advances             20,055 92,023
  Property and equipment            1,431,866 1,504,015
  Intangible assets            474,799 488,647
  Goodwill              1,018,591 973,458
  Deferred income taxes           76,697 73,302
Total assets                 16,349,328 20,129,351
                     
Liabilities                
Current liabilities                
  Accounts payable            1,445,311 2,338,238
  Compensation payable           4,130,045 6,343,417
  Dividends payable           255,983 254,782
                  5,831,339 8,936,437
Non-current liabilities                
  Long-term incentive accrual           346,481 186,267
                  6,177,820 9,122,704
Equity attributable to owners of the Company            
  Share Capital             4,080,020 4,016,020
  Contributed surplus           16,239,014 16,245,848
  Accumulated other comprehensive income       450,624 122,292
  Deficit              (10,598,150) (9,377,513)
Total equity             10,171,508 11,006,647
Total liabilities and equity           16,349,328 20,129,351

 

                     
THE CALDWELL PARTNERS INTERNATIONAL INC.      
                     
CONSOLIDATED INTERIM STATEMENTS OF LOSS          
(unaudited - in $Canadian)              
            Three months ended   Six months ended
            February 28 February 29   February 28 February 29
            2013 2012   2013 2012
                     
Revenues         6,825,047 7,220,574   14,242,258 14,490,452
                     
Cost of sales       5,594,969 5,674,763   11,215,089 11,587,062
Gross profit       1,230,078 1,545,811   3,027,169 2,903,390
                     
Expenses                  
  General and administrative     1,745,077 1,620,724   3,454,791 3,288,522
  Sales and marketing     151,899 172,994   278,856 308,418
  Foreign exchange gains (losses)   (8,054) (1,579)   4,805 (46,417)
            1,888,922 1,792,139   3,738,452 3,550,523
Operating profit (loss)     (658,844) (246,328)   (711,283) (647,133)
                     
Investment income       6,707 7,051   9,230 9,319
Loss before income tax     (652,137) (239,277)   (702,053) (637,814)
                     
Income tax       514 2,010   6,619 47,794
                     
Loss for the period attributable to owners of the Company (652,651) (241,287)   (708,672) (685,608)
                     
Loss per share:                
  Basic          ($0.038) ($0.014)   ($0.042) ($0.040)
  Diluted         ($0.038) ($0.014)   ($0.041) ($0.040)
                     
                     

CONSOLIDATED INTERIM STATEMENTS OF 
         
COMPREHENSIVE LOSS            
(unaudited - in $Canadian)              
            Three months ended   Six months ended
            February 28 February 29   February 28 February 29
            2013 2012   2013 2012
                     
Loss for the period       (652,651) (241,287)   (708,672) (685,608)
                     
Other comprehensive income:              
Items that may be reclassified subsequently to net income (loss)          
  Unrealized gain on marketable securities          111,610 108,522   209,139 45,290
  Cumulative translation adjustment         98,756 (76,717)   119,193 58,933
Comprehensive loss for the period attributable to owners of the Company (442,285) (209,482)   (380,340) (581,385)

 

 

 
THE CALDWELL PARTNERS INTERNATIONAL INC.
               
CONSOLIDATED INTERIM STATEMENTS OF CASH FLOW  
(unaudited - in $Canadian)        
            Six months ended
            February 28 February 29
            2013 2012
               
Cash flow provided by (used in)        
               
Operating Activities          
  Net (loss) earnings for the period   (708,672) (685,608)
  Adjustments for:        
    Depreciation     189,123 196,798
    Amortization     35,092 61,234
    Share-based payment expense   12,367 4,222
    Unrealized foreign exchange on subsidiary loans (117,180) (78,131)
    Non-cash incentive compensation   160,214 46,965
    Increase in restricted cash   (572) -
  Net changes in working capital       
    (Increase) decrease in accounts receivable 25,619 754,012
    Decrease (increase) in income taxes receivable 1,500 (9,952)
    (Increase) decrease  in prepaid expenses and other assets (203,125) 81,039
    Decrease in accounts payable    (929,658) (53,851)
    (Decrease) increase in short-term liabilities - (530,250)
    Decrease in compensation payable   (2,318,333) (5,127,887)
Net cash used in operating activities   (3,853,625) (5,341,409)
               
Investment Activities          
  Decrease (increase) in advances   80,181 (48,944)
  Additions to property and equipment   (92,908) (151,100)
Net cash used in investing activities   (12,727) (200,044)
               
Financing Activities          
  Dividend payments     (510,765) -
  Share issuance from employee share option plan 44,800 -
Net cash used in investing activities   (465,965) -
               
Effect of exchange rate changes on cash and cash equivalents 98,893 157,370
Net decrease in cash and cash equivalents   (4,233,424) (5,384,083)
Cash and cash equivalents, beginning of period 6,494,246 6,944,084
Cash and cash equivalents, end of period   2,260,822 1,560,001



             
THE CALDWELL PARTNERS INTERNATIONAL INC.    
             
CONSOLIDATED INTERIM STATEMENTS OF CHANGES IN EQUITY  
(unaudited - in $Canadian)            
        Accumulated Other Comprehensive  
        Income (Loss)  
          Unrealized Gains  
        Cumulative (Losses) on Total
      Contributed Translation Marketable Shareholders'
  Deficit Capital Stock Surplus Adjustment Securities Equity
             
             
Balance - September 1, 2011 (9,848,957) 16,064,078 4,179,399 (315,525) 230,598 10,309,593
             
Net loss for the six month period ended             
  February 29, 2012 (685,608) - - - - (685,608)
             
Share-based payment expense - - 4,222 - - 4,222
             
Change in unrealized gain on            
  marketable securities available for sale  - - - - 45,290 45,290
             
Change in cumulative translation adjustment - - - 58,933 - 58,933
             
Balance - February 29, 2012 (10,534,565) 16,064,078 4,183,621 (256,592) 275,888 9,732,430
             
Balance - August 31, 2012 (9,377,513) 4,016,020 16,245,848 (284,523) 406,815 11,006,647
             
Net loss for the six month period ended             
  February 28, 2013 (708,672) - - - - (708,672)
             
Dividend payments declared  (511,965) - - - - (511,965)
             
Employee share option plan share issue  - 64,000 (14,776) - - 49,224
             
Share-based payment expense - - 7,942 - - 7,942
             
Change in unrealized gain on            
  marketable securities available for sale  - - - - 209,139 209,139
             
Change in cumulative translation adjustment - - - 119,193 - 119,193
             
Balance - February 28, 2013 (10,598,150) 4,080,020 16,239,014 (165,330) 615,954 10,171,508

 

 

 

SOURCE The Caldwell Partners International Inc.



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