Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
  1. Homepage
  2. Equities
  3. Canada
  4. Toronto Stock Exchange
  5. Constellation Software Inc.
  6. News
  7. Summary
    CSU   CA21037X1006

CONSTELLATION SOFTWARE INC.

(CSU)
  Report
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
SummaryMost relevantAll NewsOther languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

Constellation Software Inc. : Announces Results for the First Quarter Ended March 31, 2021 and Declares Quarterly Dividend

05/05/2021 | 05:02pm EDT

TORONTO, May 05, 2021 (GLOBE NEWSWIRE) -- Constellation Software Inc. (TSX:CSU) (“Constellation” or the “Company”) today announced its financial results for the first quarter ended March 31, 2021 and declared a $1.00 per share dividend payable on July 10, 2021 to all common shareholders of record at close of business on June 19, 2021. This dividend has been designated as an eligible dividend for the purposes of the Income Tax Act (Canada). Please note that all dollar amounts referred to in this press release are in U.S. Dollars unless otherwise stated.

The following press release should be read in conjunction with the Company’s Unaudited Condensed Consolidated Interim Financial Statements for the three months ended March 31, 2021 and the accompanying notes, our Management Discussion and Analysis for the three months ended March 31, 2021 and with our annual Consolidated Financial Statements, prepared in accordance with International Financial Reporting Standards (“IFRS”) and our annual Management’s Discussion and Analysis for the year ended December 31, 2020, which can be found on SEDAR at www.sedar.com and on the Company’s website www.csisoftware.com. Additional information about the Company is also available on SEDAR at www.sedar.com

Q1 2021 Headlines:

  • Revenue increased 23% (6% organic growth, 1% after adjusting for changes in foreign exchange rates) to $1,176 million compared to $953 million in Q1 2020.
  • A $263 million expense related to the increase in fair value of redeemable preferred securities was incurred in the quarter, $261 million of which is non-cash related. Fair value of the preferred securities is primarily dependent on the price movement of Topicus.com Inc.’s (TSXV:TOI) Subordinate Voting Shares.
  • Net loss for Q1 2021 was $175 million ($0.41 on a diluted per share basis), compared to net income of $83 million ($3.91 on a diluted per share basis) in Q1 2020.  
  • A number of acquisitions were completed for total consideration of $448 million including holdbacks, contingent consideration and amounts related to Topicus.com B.V.
  • Cash flows from operations (“CFO”) were $495 million, an increase of 37%, or $135 million, compared to $361 million for the comparable period in 2020.
  • Free cash flow available to shareholders1 (“FCFA2S”) decreased $42 million to $269 million, after accounting for the non-controlling interest in Topicus.com Inc., compared to $311 million for the same period in 2020 representing a decrease of 14%.
  • Subsequent to March 31, 2021, the Company completed or entered into agreements to acquire a number of businesses for aggregate cash consideration of $187 (which includes acquired cash). Deferred payments have an estimated value of $11 resulting in total consideration of $198.

Total revenue for the quarter ended March 31, 2021 was $1,176 million, an increase of 23%, or $223 million, compared to $953 million for the comparable period in 2020. The increase is primarily attributable to growth from acquisitions as the Company experienced organic growth of 6%, 1% after adjusting for the impact of changes in the valuation of the US dollar against most major currencies in which the Company transacts business. For acquired companies, organic growth is calculated as the difference between actual revenues achieved by each company in the financial period following acquisition compared to the estimated revenues they achieved in the corresponding financial period preceding the date of acquisition by Constellation.

In conjunction with the acquisition of Topicus.com B.V., Topicus.com Coöperatief U.A. (“Topicus Coop”) issued 5,842,882 Topicus Coop Preference Units (the “Preferred Securities”) to Ijssel B.V. for an initial subscription price of $102 million plus an additional subscription amount of $34 million which will be owed by Ijssel B.V. to the Company and will be payable in May 2021. The Company (through Topicus Coop) also issued 5,842,882 Topicus Coop Ordinary Units to Ijssel B.V. The Preferred Securities are non-voting and are redeemable at the option of the holder for a redemption price of approximately €19.06 ($23.28) per security. The redemption price may either be settled in cash or through the issuance of a variable number of Topicus Coop Ordinary Units. The number of Topicus Coop Ordinary Units would be determined based on the terms of the Preferred Securities. The Preferred Securities are convertible into Topicus Coop Ordinary Units at a conversion ratio of 1:1, and the Topicus Coop Ordinary Units are convertible into Subordinate Voting Shares of Topicus.com Inc. also at a conversion ratio of 1:1. The Preferred Securities holders will also be entitled to a fixed annual cumulative dividend of 5% per annum on the initial Preferred Securities value of approximately €19.06 ($23.28) per security.

The Preferred Securities will be recorded at fair value at the end of each reporting period. The change in fair value of the Preferred Securities is recorded as redeemable preferred securities expense (income) in the condensed consolidated interim statements of income. Based on the Preferred Securities conversion right, the value of the Preferred Securities is primarily dependent on the price movement of Topicus’ Subordinate Voting Shares. At March 31, 2021 the market price of Topicus’ Subordinate Voting Shares closed at C$82.54 or approximately $65.54. The increase in value from $23.28 to $65.54 multiplied by the 5.8 million Preferred Securities outstanding equals approximately $247 million. The difference between $247 million and the fair value adjustment of $263 million primarily relates to the impact of share price volatility and optionality and the accrued dividend of $2 million.

As the threshold for the mandatory conversion or redemption of all Preferred Securities was reached on April 29, 2021, it is expected that the holders will provide their notification for conversion no later than May 29, 2021 at which time the associated liability excluding accrued dividends will be extinguished and reclassified to equity.

Net loss for the quarter ended March 31, 2021 was $175 million compared to net income of $83 million for the same period in 2020. On a per share basis this translated into a net loss per diluted share of $0.41 in the quarter ended March 31, 2021 compared to net income per diluted share of $3.91 for the same period in 2020.

For the quarter ended March 31, 2021, CFO increased $135 million to $495 million compared to $361 million for the same period in 2020 representing an increase of 37%.

For the quarter ended March 31, 2021, FCFA2S decreased $42 million to $269 million compared to $311 million for the same period in 2020 representing a decrease of 14%.

Forward Looking Statements

Certain statements herein may be “forward looking” statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Constellation or the industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward looking statements. These forward looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof and Constellation assumes no obligation, except as required by law, to update any forward looking statements to reflect new events or circumstances.

Non-IFRS Measures

Free cash flow available to shareholders ‘‘FCFA2S’’ refers to net cash flows from operating activities less interest paid on lease obligations, interest paid on other facilities, credit facility transaction costs, repayments of lease obligations, the IRGA / TSS membership liability revaluation charge, and property and equipment purchased, and includes interest and dividends received. The portion of this amount applicable to non-controlling interests is then deducted. We believe that FCFA2S is useful supplemental information as it provides an indication of the uncommitted cash flow that is available to shareholders if we do not make any acquisitions, or investments, and do not repay any debts. While we could use the FCFA2S to pay dividends or repurchase shares, our objective is to invest all of our FCFA2S in acquisitions which meet our hurdle rate.  

FCFA2S is not a recognized measure under IFRS and, accordingly, readers are cautioned that FCFA2S should not be construed as an alternative to net cash flows from operating activities.

The following table reconciles FCFA2S to net cash flows from operating activities:

  Three months ended March 31, 
  20212020 
 ($ in millions, except percentages)
     
Net cash flows from operating activities 495 361  
Adjusted for:    
Interest paid on lease obligations (2)(2) 
Interest paid on other facilities (9)(8) 
Credit facility transaction costs (2)-  
Payments of lease obligations (20)(14) 
IRGA / TSS membership liability revaluation charge (61)(18) 
Property and equipment purchased (4)(7) 
Interest and dividends received 1 0  
     
  397 311  
Less amount attributable to    
Non-controlling interests (128)-  
     
Free cash flow available to shareholders 269 311  
     
Due to rounding, certain totals may not foot.    

About Constellation Software Inc.

Constellation's common shares are listed on the Toronto Stock Exchange under the symbol "CSU". Constellation acquires, manages and builds vertical market software businesses.

For further information:

Jamal Baksh
Chief Financial Officer
(416) 861-9677
info@csisoftware.com
www.csisoftware.com

SOURCE: CONSTELLATION SOFTWARE INC.

 
CONSTELLATION SOFTWARE INC.
Consolidated Statements of Financial Position
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
     
Unaudited   
  March 31, 2021 December 31, 2020 March 31, 2020 
     
Assets   
     
Current assets:   
 Cash$932 $758 $364 
 Accounts receivable 518  483  455 
 Unbilled revenue 128  98  104 
 Inventories 27  27  32 
 Other assets 288  219  209 
   1,892  1,585  1,163 
     
Non-current assets:   
 Property and equipment 92  86  78 
 Right of use assets 266  251  233 
 Deferred income taxes 57  52  46 
 Other assets 80  75  70 
 Intangible assets 2,759  2,325  1,987 
   3,254  2,790  2,414 
     
Total assets$5,147 $4,375 $3,577 
     
Liabilities and Shareholders' Equity   
     
Current liabilities:   
 Debt with recourse to Constellation Software Inc.$122 $113 $90 
 Debt without recourse to Constellation Software Inc. 34  28  2 
 Redeemable preferred securities 390  -  - 
 Accounts payable and accrued liabilities 637  666  453 
 Dividends payable 21  21  21 
 Deferred revenue 1,296  962  1,035 
 Provisions 15  12  10 
 Acquisition holdback payables 78  85  78 
 Lease obligations 77  74  59 
 Income taxes payable 91  78  60 
   2,761  2,040  1,809 
     
Non-current liabilities:   
 Debt with recourse to Constellation Software Inc. 527  421  348 
 Debt without recourse to Constellation Software Inc. 271  199  143 
 Deferred income taxes 371  285  250 
 Acquisition holdback payables 31  37  30 
 Lease obligations 214  201  191 
 Other liabilities 139  146  87 
   1,554  1,288  1,049 
     
Total liabilities 4,315  3,328  2,858 
     
     
Shareholders' equity:   
 Capital stock 99  99  99 
 Other equity (165) -  - 
 Accumulated other comprehensive income (loss) (67) (31) (70)
 Retained earnings 950  980  690 
 Non-controlling interests 15  -  - 
   832  1,048  719 
     
     
     
Total liabilities and shareholders' equity$5,147 $4,375 $3,577 
     


 
CONSTELLATION SOFTWARE INC.
Condensed Consolidated Interim Statements of Income
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
   
   
Unaudited  
 Three months ended March 31,
  2021  2020 
   
   
Revenue  
License$66 $57 
Professional services 237  178 
Hardware and other 39  42 
Maintenance and other recurring 834  676 
  1,176  953 
   
Expenses  
Staff 641  510 
Hardware 22  23 
Third party license, maintenance and professional services 96  79 
Occupancy 9  9 
Travel, telecommunications, supplies, software and equipment 39  51 
Professional fees 15  14 
Other, net 5  5 
Depreciation 29  25 
Amortization of intangible assets 118  94 
  975  810 
   
   
Foreign exchange loss (gain) (13) (6)
IRGA/TSS Membership liability revaluation charge 61  18 
Finance and other expense (income) (2) (0)
Impairment of intangible and other non-financial assets 3  5 
Redeemable preferred securities expense (income) 263  - 
Finance costs 15  11 
  327  28 
   
Income (loss) before income taxes (126) 115 
   
Current income tax expense (recovery) 64  44 
Deferred income tax expense (recovery) (14) (12)
Income tax expense (recovery) 49  33 
   
Net income (loss) (175) 83 
   
Net income (loss) attributable to:  
Equity holders of Constellation Software Inc. (9) 83 
Non-controlling interests (166) - 
Net income (loss) (175) 83 
   
Earnings per common share of Constellation Software Inc.  
Basic and diluted$(0.41)$3.91 
   
   


 
CONSTELLATION SOFTWARE INC.
Condensed Consolidated Interim Statements of Comprehensive Income
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
   
   
Unaudited  
 Three months ended March 31,
  2021  2020 
   
Net income (loss)$(175)$83 
   
Items that are or may be reclassified subsequently to net income:  
   
Foreign currency translation differences from foreign operations and other (23) (30)
   
Other comprehensive income (loss) for the period, net of income tax (23) (30)
   
Total comprehensive income (loss) for the period$(198)$53 
   
Total other comprehensive income (loss) attributable to:  
Equity holders of Constellation Software Inc. (17) (30)
Non-controlling interests (6) - 
Total other comprehensive income (loss)$(23)$(30)
   
Total comprehensive income (loss) attributable to:  
Equity holders of Constellation Software Inc. (26) 53 
Non-controlling interests (172) - 
Total comprehensive income (loss)$(198)$53 
   


 
CONSTELLATION SOFTWARE INC.
Condensed Consolidated Interim Statement of Changes in Equity
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
        
Unaudited       
Three months ended March 31, 2021       
 Equity Attributable to Shareholders of CSI  
 Capital
stock

 Other equityAccumulated
other
comprehensive
income (loss)
Retained
earnings

 Total
 Non-
controlling
interests

 Total equity
 
        
Balance at January 1, 2021$ 99 $ - $ (31)$ 980 $ 1,048  - $ 1,048 
        
Total comprehensive income for the period:       
        
Net income (loss) -  -  -  (9) (9) (166) (175)
        
Other comprehensive income (loss)       
        
Foreign currency translation differences from       
foreign operations and other -  -  (17) -  (17) (6) (23)
        
Total other comprehensive income (loss)       
for the period -  -  (17) -  (17) (6) (23)
        
Total comprehensive income (loss) for the period -  -  (17) (9) (26) (172) (198)
        
Transactions with owners, recorded directly in equity       
        
Special dividend of Topicus Subordinated Voting Shares -  (141) (16) -  (157) 157  - 
        
Issuance of Topicus Coop Ordinary Units to non-controlling interests (note 4) -  (21) (2) -  (23) 23  - 
        
Net acquisition of non-controlling interest associated with acquisitions and other movements -  (3) -  0  (3) 6  3 
        
Dividends to shareholders of the Company -   -  (21) (21) -  (21)
        
Balance at March 31, 2021$ 99 $ (165)$ (67)$ 950 $ 817 $ 15 $ 832 
        


 
CONSTELLATION SOFTWARE INC.
Condensed Consolidated Interim Statement of Changes in Equity
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
        
Unaudited       
Three months ended March 31, 2020       
        
 Equity Attributable to Shareholders of CSI  
 Capital
stock

 Other equityAccumulated
other
comprehensive
income (loss)
Retained
earnings

 Total
 Non-
controlling
interests

 Total equity
 
        
Balance at January 1, 2020$ 99 $ - $ (40)$ 628 $ 687 $ - $ 687 
        
Total comprehensive income for the period:       
        
Net income (loss) -  -  -  83  83  -  83 
        
Other comprehensive income (loss)       
        
Foreign currency translation differences from       
foreign operations and other -  -  (30) -  (30) -  (30)
        
Total other comprehensive income (loss) for the period -  -  (30) -  (30) -  (30)
        
Total comprehensive income (loss) for the period -  -  (30) 83  53  -  53 
        
Transactions with owners, recorded directly in equity       
Dividends to shareholders of the Company -   -  (21) (21) -  (21)
        
Balance at March 31, 2020$ 99 $ - $ (70)$ 690 $ 719 $ - $ 719 
        


 
CONSTELLATION SOFTWARE INC.
Condensed Consolidated Interim Statements of Cash Flows
(In millions of U.S. dollars, except per share amounts. Due to rounding, numbers presented may not foot.)
     
     
Unaudited  
   Three months ended March 31,
    2021  2020 
     
Cash flows from operating activities:  
 Net income (loss)$(175)$83 
 Adjustments for:  
  Depreciation 29  25 
  Amortization of intangible assets 118  94 
  IRGA/TSS Membership liability revaluation charge 61  18 
  Finance and other expense (income) (2) (0)
  Impairment of intangible and other non-financial assets 3  5 
  Redeemable preferred securities expense (income) 263  - 
  Finance costs 15  11 
  Income tax expense (recovery) 49  33 
  Foreign exchange loss (gain) (13) (6)
 Change in non-cash operating assets and liabilities  
  exclusive of effects of business combinations 198  136 
 Income taxes paid (51) (38)
 Net cash flows from (used in) operating activities 495  361 
     
Cash flows from (used in) financing activities:  
 Interest paid on lease obligations (2) (2)
 Interest paid on other facilities (9) (8)
 Increase (decrease) in CSI facility -  (65)
 Increase (decrease) in revolving credit debt facilities without recourse to CSI 6  (55)
 Proceeds from issuance of term debt facilities without recourse to CSI 79  - 
 Repayments of term debt facilities without recourse to CSI (1) (1)
 Credit facility transaction costs (2) - 
 Payments of lease obligations (20) (14)
 Distribution to the Joday Group (22) - 
 Dividends paid (21) (21)
 Net cash flows from (used in) in financing activities 6  (167)
     
Cash flows from (used in) investing activities:  
 Acquisition of businesses (314) (107)
 Cash obtained with acquired businesses 44  14 
 Post-acquisition settlement payments, net of receipts (46) (32)
 Purchases of other investments (0) (1)
 Interest, dividends and other proceeds received 3  0 
 Property and equipment purchased (4) (7)
 Net cash flows from (used in) investing activities (319) (133)
     
Effect of foreign currency on  
 cash and cash equivalents (9) (13)
     
Increase (decrease) in cash 174  48 
     
Cash, beginning of period 758  316 
     
Cash, end of period$932 $364 
     


Primary Logo

Source: Constellation Software Inc.

2021 GlobeNewswire, Inc., source Press Releases

All news about CONSTELLATION SOFTWARE INC.
05:05pCONSTELLATION SOFTWARE INC. : and Topicus.Com Inc. Announce Results for Topicus...
AQ
08/03TSX gains on boost from tech stocks
RE
07/30TOPICUS COM : CGG Selling GeoSoftware Business to Topicus, Constellation Softwar..
MT
07/23RBC Provides Preview of Second-Quarter Results for Canadian Technology Compan..
MT
07/20CONSTELLATION SOFTWARE : Announces Release Date for Second Quarter Results
PU
07/20CONSTELLATION SOFTWARE INC. : Announces Release Date foráSecond Quarter Results
AQ
07/05CONSTELLATION SOFTWARE : Unit to Buy Concentrix's Mobile Network Solutions Busin..
MT
07/02CONSTELLATION SOFTWARE : Lumine Group Acquires Ubersmith Inc.s
MT
06/17CONSTELLATION SOFTWARE INC. : No data in subsection
FA
06/07FAIR ISAAC : Says Completes Sale of Collection and Recovery Business to Constell..
MT
More news
Financials (USD)
Sales 2021 5 005 M - -
Net income 2021 310 M - -
Net cash 2021 522 M - -
P/E ratio 2021 119x
Yield 2021 0,25%
Capitalization 34 199 M 34 200 M -
EV / Sales 2021 6,73x
EV / Sales 2022 5,75x
Nbr of Employees 19 000
Free-Float 93,8%
Chart CONSTELLATION SOFTWARE INC.
Duration : Period :
Constellation Software Inc. Technical Analysis Chart | CSU | CA21037X1006 | MarketScreener
Technical analysis trends CONSTELLATION SOFTWARE INC.
Short TermMid-TermLong Term
TrendsBullishBullishBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 8
Last Close Price 1 613,81 $
Average target price 1 627,70 $
Spread / Average Target 0,86%
EPS Revisions
Managers and Directors
Mark Henri Leonard Chairman & President
Jamal Nizam Baksh Chief Financial Officer
Mark Robert Miller Chief Operating Officer & Director
Bernard Anzarouth Chief Investment Officer
Stephen R. Scotchmer Lead Independent Director
Sector and Competitors
1st jan.Capi. (M$)
CONSTELLATION SOFTWARE INC.21.00%33 754
ORACLE CORPORATION38.72%250 554
SAP SE13.69%170 469
INTUIT INC.38.87%144 877
SERVICENOW, INC.6.22%115 842
DOCUSIGN, INC.31.65%57 020