TORONTO, Oct. 26, 2017 (GLOBE NEWSWIRE) -- Constellation Software Inc. (TSX:CSU) (“Constellation” or the “Company”) today announced its financial results for the third quarter ended September 30, 2017 and declared a $1.00 per share dividend payable on January 4, 2018 to all common shareholders of record at close of business on December 15, 2017. 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 and nine months ended September 30, 2017 and the accompanying notes, our Management Discussion and Analysis for the three and nine months ended September 30, 2017 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, 2016, 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.
Q3 2017 Headlines:
- Revenue grew 17% (4% organic growth, 2% after adjusting for changes in foreign exchange rates) to $637 million compared to $546 million in Q3 2016.
- Adjusted EBITA increased $21 million or 15% to $162 million as compared to $140 million in Q3 2016.
- Net income decreased 20% to $54 million ($2.56 on a diluted per share basis) from $68 million ($3.18 on a diluted per share basis) in Q3 2016.
- Adjusted net income declined 4% to $116 million ($5.45 on a diluted per share basis) from $121 million ($5.70 on a diluted per share basis) in Q3 2016. Excluding the impact of unrealized foreign exchange (gains) and losses recorded in Q3 2017 and Q3 2016 Adjusted net income increased 3% to $123 million ($5.81 on a diluted per share basis) from $120 million ($5.65 on a diluted per share basis) in Q3 2016.
- Fourteen acquisitions were completed for aggregate cash consideration of $52 million (which includes acquired cash). Deferred payments associated with these acquisitions have an estimated value of $12 million.
- Cash flows from operations were $123 million, a decrease of 11%, or $15 million, compared to $138 million for the comparable period in 2016.
- Subsequent to September 30, 2017, the Company entered into agreements to acquire seven entities for aggregate cash consideration of $41 million on closing plus cash holdbacks of $9 million for total consideration of $50 million.
Total revenue for the quarter ended September 30, 2017 was $637 million, an increase of 17%, or $91 million, compared to $546 million for the comparable period in 2016. For the first nine months of 2017 total revenues were $1,792 million, an increase of 15%, or $231 million, compared to $1,561 million for the comparable period in 2016. The increase for both the three and nine month periods compared to the same periods in the prior year is primarily attributable to growth from acquisitions as the Company experienced organic growth of 4% and 2% respectively, 2% and 3% respectively after adjusting for the impact of the changes in the valuation of the US dollar against most major currencies in which the Company transacts business.
For the quarter ended September 30, 2017, Adjusted EBITA increased to $162 million compared to $140 million for the same period in 2016 representing an increase of 15%. Adjusted EBITA margin was 25% for the quarter ended September 30, 2017 and 26% for the same period in 2016. For the first nine months of 2017, Adjusted EBITA increased to $447 million compared to $379 million during the same period in 2016, representing an increase of 18%. Adjusted EBITA margin was 25% in the first nine months of 2017 and 24% for the same period in 2016.
Net income for the quarter ended September 30, 2017 was $54 million compared to net income of $68 million for the same period in 2016. On a per share basis this translated into a net income per diluted share of $2.56 in the quarter ended September 30, 2017 compared to net income per diluted share of $3.18 for the same period in 2016. For the nine months ended September 30, 2017, net income was $146 million or $6.88 per diluted share compared to $141 million or $6.66 per diluted share for the same period in 2016.
For the quarter ended September 30, 2017, Adjusted net income decreased to $116 million from $121 million for the same period in 2016, representing a decrease of 4%. Adjusted net income margin was 18% for the quarter ended September 30, 2017 and 22% for the same period in 2016. For the first nine months of 2017, Adjusted net income increased to $322 million from $273 million during the same period in 2016, representing an increase of 18%. Adjusted net income margin was 18% in the first nine months of 2017 and 17% for the same period in 2016. Excluding the impact of the unrealized foreign exchange (gain) loss recorded in each of the three and nine month periods ended September 30, 2016 and 2017 the margins would have been 19% for both of the respective periods in 2017, and 22% and 19% for the respective periods in 2016.
Cash flows from operations for the quarter ended September 30, 2017 were $123 million, a decrease of 11%, or $15 million, compared to $138 million for the comparable period in 2016.
The following table displays our revenue by reportable segment and the percentage change for the three and nine months ended September 30, 2017 compared to the same periods in 2016:
| Three months ended September 30, | Period-Over- Period Change | Organic Growth | Nine months ended September 30, | Period-Over- Period Change | Organic Growth | |||||||||||
| 2017 | 2016 | $ | % | % | 2017 | 2016 | $ | % | % | |||||||
| ($M, except percentages) | ($M, except percentages) | |||||||||||||||
| Public Sector | ||||||||||||||||
| Licenses | 28 | 21 | 7 | 34 | % | 2 | % | 75 | 63 | 12 | 20 | % | -9 | % | ||
| Professional services | 101 | 87 | 14 | 16 | % | 4 | % | 287 | 251 | 36 | 14 | % | 1 | % | ||
| Hardware and other | 37 | 33 | 4 | 12 | % | 4 | % | 96 | 88 | 8 | 9 | % | 3 | % | ||
| Maintenance and other recurring | 269 | 226 | 43 | 19 | % | 5 | % | 759 | 643 | 115 | 18 | % | 3 | % | ||
| 436 | 368 | 68 | 18 | % | 5 | % | 1,217 | 1,045 | 172 | 16 | % | 2 | % | |||
| Private Sector | ||||||||||||||||
| Licenses | 16 | 14 | 2 | 15 | % | 3 | % | 46 | 41 | 5 | 12 | % | 2 | % | ||
| Professional services | 24 | 22 | 2 | 8 | % | -3 | % | 72 | 67 | 5 | 8 | % | -2 | % | ||
| Hardware and other | 7 | 7 | 0 | 4 | % | -10 | % | 21 | 21 | 0 | 1 | % | -8 | % | ||
| Maintenance and other recurring | 153 | 134 | 19 | 14 | % | 4 | % | 437 | 388 | 48 | 12 | % | 3 | % | ||
| 200 | 178 | 23 | 13 | % | 2 | % | 575 | 517 | 59 | 11 | % | 2 | % | |||
| Certain totals and percentages may not reconcile due to rounding. | ||||||||||||||||
For purposes of calculating organic growth, estimated pre-acquisition revenue from the relevant companies acquired in 2016 and 2017 was added to actual reported revenue for the three and nine months ended September 30, 2016.
Public Sector
For the quarter ended September 30, 2017, total revenue in the public sector reportable segment increased 18%, or $68 million to $436 million, compared to $368 million for the quarter ended September 30, 2016. For the nine months ended September 30, 2017, total revenue increased by 16%, or $172 million to $1,217 million, compared to $1,045 million for the comparable period in 2016. Organic revenue growth was 5% and 2% respectively for the three and nine months ended September 30, 2017 compared to the same periods in 2016, and 3% and 2% for after adjusting for the impact of changes in the valuation of the US dollar against most major currencies in which the Company transacts business.
Private Sector
For the quarter ended September 30, 2017, total revenue in the private sector reportable segment increased 13%, or $23 million to $200 million, compared to $178 million for the quarter ended September 30, 2016. For the nine months ended September 30, 2017, total revenue increased by 11%, or $59 million to $575 million, compared to $517 million for the comparable period in 2016. Organic revenue growth was 2% for both the three and nine months ended September 30, 2017 compared to the same periods in 2016, and 1% and 3% respectively after adjusting for the impact of changes in the valuation of the US dollar against most major currencies in which the Company transacts business.
Conference Call and Webcast
Management will host a conference call at 7:30 a.m. (ET) on Friday, October 27, 2017 to answer questions regarding the results. The teleconference numbers are 647-788-4919 or 877-291-4570. The call will also be webcast live and archived on Constellation’s website at www.csisoftware.com.
A replay of the conference call will be available as of 12:30 p.m. ET the same day until 11:59 p.m. ET on November 10, 2017. To access the replay, please dial 416-621-4642 or 800-585-8367 followed by the passcode 99526408.
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
The term ‘‘Adjusted EBITA’’ refers to net income before adjusting for finance and other income, bargain purchase gain, finance costs, income taxes, share in net income or loss of equity investees, impairment of non-financial assets, amortization, TSS membership liability revaluation charge, and foreign exchange gain or loss. The Company believes that Adjusted EBITA is useful supplemental information as it provides an indication of the results generated by the Company’s main business activities prior to taking into consideration how those activities are financed and taxed and also prior to taking into consideration intangible asset amortization and the other items listed above. ‘‘Adjusted EBITA margin’’ refers to the percentage that Adjusted EBITA for any period represents as a portion of total revenue for that period.
‘‘Adjusted net income’’ means net income adjusted for non-cash expenses (income) such as amortization of intangible assets, deferred income taxes, the TSS membership liability revaluation charge, and certain other expenses (income), and excludes the portion of the adjusted net income of Total Specific Solutions (TSS) B.V. (“TSS”) attributable to the minority owners of TSS. The Company believes that Adjusted net income is useful supplemental information as it provides an indication of the results generated by the Company’s main business activities prior to taking into consideration amortization of intangible assets, deferred income taxes, the TSS membership liability revaluation charge, and certain other non-cash expenses (income) incurred or recognized by the Company from time to time, and adjusts for the portion of TSS’ Adjusted net income not attributable to shareholders of Constellation. ‘‘Adjusted net income margin’’ refers to the percentage that Adjusted net income for any period represents as a portion of total revenue for that period.
Adjusted EBITA and Adjusted net income are not recognized measures under IFRS and, accordingly, readers are cautioned that Adjusted EBITA and Adjusted net income should not be construed as alternatives to net income determined in accordance with IFRS. The Company’s method of calculating Adjusted EBITA and Adjusted net income may differ from other issuers and, accordingly, Adjusted EBITA and Adjusted net income may not be comparable to similar measures presented by other issuers. Adjusted EBITA includes 100% of the Adjusted EBITA of TSS.
The following table reconciles Adjusted EBITA to net income:
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||
| ($M, except percentages) | ($M, except percentages) | |||||||||||||
| Total revenue | 636 | 546 | 1,792 | 1,561 | ||||||||||
| Net income | 54 | 67 | 146 | 141 | ||||||||||
| Adjusted for: | ||||||||||||||
| Income tax expense (recovery) | 26 | 27 | 69 | 59 | ||||||||||
| Foreign exchange (gain) loss | 8 | (1 | ) | 11 | 25 | |||||||||
| TSS membership liability revaluation charge | 12 | 7 | 40 | 14 | ||||||||||
| Share in net (income) loss of equity investees | (0 | ) | (5 | ) | (0 | ) | (6 | ) | ||||||
| Finance and other income | (1 | ) | (3 | ) | (2 | ) | (3 | ) | ||||||
| Bargain purchase gain | (5 | ) | - | (5 | ) | - | ||||||||
| Finance costs | 9 | 5 | 19 | 16 | ||||||||||
| Amortization of intangible assets | 60 | 43 | 168 | 132 | ||||||||||
| Adjusted EBITA | 162 | 140 | 447 | 379 | ||||||||||
| Adjusted EBITA margin | 25 | % | 26 | % | 25 | % | 24 | % | ||||||
| Certain totals and percentages may not reconcile due to rounding. | ||||||||||||||
The following table reconciles Adjusted net income to net income:
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||
| ($M, except percentages) | ($M, except percentages) | |||||||||||||
| Total revenue | 636 | 546 | 1,792 | 1,561 | ||||||||||
| Net income | 54 | 67 | 146 | 141 | ||||||||||
| Adjusted for: | ||||||||||||||
| Amortization of intangible assets | 60 | 43 | 168 | 132 | ||||||||||
| TSS membership liability revaluation charge | 12 | 7 | 40 | 14 | ||||||||||
| Bargain purchase gain | (5 | ) | - | (5 | ) | - | ||||||||
| Less non-controlling interest in the Adjusted | ||||||||||||||
| net income of TSS | (5 | ) | (4 | ) | (16 | ) | (13 | ) | ||||||
| Deferred income tax expense (recovery) | (0 | ) | 8 | (11 | ) | (1 | ) | |||||||
| Adjusted net income | 115 | 121 | 322 | 273 | ||||||||||
| Adjusted net income margin | 18 | % | 22 | % | 18 | % | 17 | % | ||||||
| Certain totals and percentages may not reconcile due to rounding. | ||||||||||||||
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
| CONSTELLATION SOFTWARE INC. | ||||||||
| Condensed Consolidated Interim Statements of Financial Position | ||||||||
| (In thousands of U.S. dollars) | ||||||||
| Unaudited | ||||||||
| September 30, 2017 | December 31, 2016 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash | $ | 414,586 | $ | 353,499 | ||||
| Equity securities available-for-sale | - | 4,236 | ||||||
| Accounts receivable, net | 298,798 | 243,554 | ||||||
| Work in progress | 68,602 | 56,541 | ||||||
| Inventories | 29,240 | 19,667 | ||||||
| Other assets | 107,499 | 96,181 | ||||||
| 918,725 | 773,678 | |||||||
| Non-current assets: | ||||||||
| Property and equipment | 53,006 | 46,395 | ||||||
| Deferred income taxes | 34,494 | 49,863 | ||||||
| Other assets | 21,436 | 19,782 | ||||||
| Intangible assets | 1,139,435 | 993,743 | ||||||
| 1,248,371 | 1,109,783 | |||||||
| Total assets | $ | 2,167,096 | $ | 1,883,461 | ||||
| Liabilities and Shareholders' Equity | ||||||||
| Current liabilities: | ||||||||
| CSI Facility | $ | - | $ | - | ||||
| New CNH Facility | 74,881 | - | ||||||
| CNH Facility | - | 7,361 | ||||||
| TSS Membership Liability | 45,063 | 26,435 | ||||||
| Accounts payable and accrued liabilities | 328,304 | 291,697 | ||||||
| Dividends payable | 20,794 | 21,051 | ||||||
| Deferred revenue | 556,190 | 460,975 | ||||||
| Provisions | 9,336 | 7,955 | ||||||
| Acquisition holdback payments | 34,968 | 17,056 | ||||||
| Income taxes payable | 55,537 | 40,634 | ||||||
| 1,125,073 | 873,164 | |||||||
| Non-current liabilities: | ||||||||
| CNH Facility | - | 115,336 | ||||||
| TSS Membership Liability | 79,271 | 46,502 | ||||||
| Debentures | 238,693 | 223,870 | ||||||
| Deferred income taxes | 139,657 | 129,585 | ||||||
| Acquisition holdback payments | 4,965 | 855 | ||||||
| Other liabilities | 30,588 | 36,640 | ||||||
| 493,174 | 552,788 | |||||||
| Total liabilities | 1,618,247 | 1,425,952 | ||||||
| Shareholders' equity: | ||||||||
| Capital stock | 99,283 | 99,283 | ||||||
| Accumulated other comprehensive income (loss) | (27,044 | ) | (36,108 | ) | ||||
| Retained earnings | 476,610 | 394,334 | ||||||
| 548,849 | 457,509 | |||||||
| Total liabilities and shareholders' equity | $ | 2,167,096 | $ | 1,883,461 | ||||
| CONSTELLATION SOFTWARE INC. | ||||||||||||||||
| Condensed Consolidated Interim Statements of Income | ||||||||||||||||
| (In thousands of U.S. dollars, except per share amounts) | ||||||||||||||||
| Three and nine months ended September 30, 2017 and 2016 | ||||||||||||||||
| Unaudited | ||||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Revenue | ||||||||||||||||
| License | $ | 44,478 | $ | 35,285 | $ | 120,482 | $ | 103,110 | ||||||||
| Professional services | 125,530 | 109,872 | 358,648 | 317,464 | ||||||||||||
| Hardware and other | 43,852 | 39,515 | 117,208 | 109,030 | ||||||||||||
| Maintenance and other recurring | 422,599 | 360,974 | 1,195,531 | 1,031,692 | ||||||||||||
| 636,459 | 545,646 | 1,791,869 | 1,561,296 | |||||||||||||
| Expenses | ||||||||||||||||
| Staff | 312,667 | 266,142 | 898,751 | 781,744 | ||||||||||||
| Hardware | 24,208 | 21,660 | 63,619 | 61,725 | ||||||||||||
| Third party license, maintenance and professional services | 55,059 | 51,264 | 155,601 | 142,848 | ||||||||||||
| Occupancy | 15,584 | 13,047 | 43,454 | 37,590 | ||||||||||||
| Travel | 18,546 | 15,678 | 52,438 | 44,999 | ||||||||||||
| Telecommunications | 5,716 | 5,376 | 16,051 | 16,198 | ||||||||||||
| Supplies | 4,103 | 2,304 | 11,583 | 6,991 | ||||||||||||
| Software and equipment | 11,200 | 9,590 | 30,556 | 27,180 | ||||||||||||
| Professional fees | 7,921 | 6,438 | 21,614 | 19,932 | ||||||||||||
| Other, net | 14,126 | 8,263 | 35,112 | 28,029 | ||||||||||||
| Depreciation | 5,768 | 5,454 | 16,388 | 15,436 | ||||||||||||
| Amortization of intangible assets | 59,829 | 42,676 | 167,852 | 131,987 | ||||||||||||
| 534,727 | 447,892 | 1,513,019 | 1,314,659 | |||||||||||||
| Foreign exchange loss (gain) | 7,567 | (1,026 | ) | 10,926 | 24,778 | |||||||||||
| TSS membership liability revaluation charge | 11,781 | 7,070 | 40,311 | 13,937 | ||||||||||||
| Share in net (income) loss of equity investee | (80 | ) | (5,410 | ) | (206 | ) | (5,717 | ) | ||||||||
| Finance and other expense (income) | (1,291 | ) | (2,929 | ) | (1,720 | ) | (3,201 | ) | ||||||||
| Bargain purchase gain | (5,008 | ) | - | (5,008 | ) | - | ||||||||||
| Finance costs | 8,725 | 5,332 | 19,456 | 16,353 | ||||||||||||
| 21,694 | 3,037 | 63,759 | 46,150 | |||||||||||||
| Income before income taxes | 80,038 | 94,717 | 215,091 | 200,487 | ||||||||||||
| Current income tax expense (recovery) | 25,975 | 19,244 | 80,191 | 59,915 | ||||||||||||
| Deferred income tax expense (recovery) | (206 | ) | 8,011 | (10,952 | ) | (556 | ) | |||||||||
| Income tax expense (recovery) | 25,769 | 27,255 | 69,239 | 59,359 | ||||||||||||
| Net income | 54,269 | 67,462 | 145,852 | 141,128 | ||||||||||||
| Earnings per share | ||||||||||||||||
| Basic and diluted | $ | 2.56 | $ | 3.18 | $ | 6.88 | $ | 6.66 | ||||||||
| CONSTELLATION SOFTWARE INC. | ||||||||||||||||
| Condensed Consolidated Interim Statements of Comprehensive Income | ||||||||||||||||
| (In thousands of U.S. dollars, except per share amounts) | ||||||||||||||||
| Three and nine months ended September 30, 2017 and 2016 | ||||||||||||||||
| Unaudited | ||||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Net income | $ | 54,269 | $ | 67,462 | $ | 145,852 | $ | 141,128 | ||||||||
| Items that are or may be reclassified subsequently to net income: | ||||||||||||||||
| Net change in fair value | ||||||||||||||||
| of available-for-sale financial | ||||||||||||||||
| asset during the period | - | 6,612 | (1,314 | ) | 6,946 | |||||||||||
| Net change in fair value | ||||||||||||||||
| of derivatives designated as hedges | ||||||||||||||||
| during the period | 193 | 157 | 538 | 134 | ||||||||||||
| Amounts reclassified to profit during the period | ||||||||||||||||
| related to realized losses (gains) on | ||||||||||||||||
| available-for-sale financial assets | - | (2,539 | ) | 1,288 | (2,539 | ) | ||||||||||
| Foreign currency translation differences from foreign operations | 857 | 1,264 | 8,704 | 4,301 | ||||||||||||
| Deferred income tax recovery (expense) | (58 | ) | (541 | ) | (152 | ) | (578 | ) | ||||||||
| Other comprehensive (loss) income for the period, net of income tax | 992 | 4,953 | 9,064 | 8,264 | ||||||||||||
| Total comprehensive income (loss) for the period | $ | 55,261 | $ | 72,415 | $ | 154,916 | $ | 149,392 | ||||||||
| CONSTELLATION SOFTWARE INC. | ||||||||||||||||||||
| Condensed Consolidated Interim Statements of Changes in Equity | ||||||||||||||||||||
| (In thousands of U.S. dollars) | ||||||||||||||||||||
| Unaudited | ||||||||||||||||||||
| Nine months ended September 30, 2017 | ||||||||||||||||||||
| Capital stock | Accumulated other comprehensive income/(loss) | Total accumulated other comprehensive income/(loss) | Retained earnings | Total | ||||||||||||||||
| Cumulative translation account | Amounts related to gains/losses on available- for-sale financial assets | Amounts related to gains/(losses) on derivatives designed as hedges | ||||||||||||||||||
| Balance at January 1, 2017 | $ | 99,283 | $ | (35,748 | ) | $ | 17 | $ | (377 | ) | $ | (36,108 | ) | $ | 394,334 | $ | 457,509 | |||
| Total comprehensive income for the period: | ||||||||||||||||||||
| Net income | - | - | - | - | - | 145,852 | 145,852 | |||||||||||||
| Other comprehensive income (loss) | ||||||||||||||||||||
| Net change in fair value | ||||||||||||||||||||
| of available-for-sale financial | ||||||||||||||||||||
| asset during the period | - | - | (1,314 | ) | - | (1,314 | ) | - | (1,314 | ) | ||||||||||
| Net change in fair value | ||||||||||||||||||||
| of derivatives designated as hedges | ||||||||||||||||||||
| during the period | - | - | - | 538 | 538 | - | 538 | |||||||||||||
| Amounts reclassified to profit during the period | ||||||||||||||||||||
| related to realized losses (gains) on | ||||||||||||||||||||
| available-for-sale financial assets | - | - | 1,288 | - | 1,288 | - | 1,288 | |||||||||||||
| Foreign currency translation differences from | ||||||||||||||||||||
| foreign operations | - | 8,704 | - | - | 8,704 | - | 8,704 | |||||||||||||
| Deferred tax recovery (expense) | - | - | 9 | (161 | ) | (152 | ) | - | (152 | ) | ||||||||||
| Total other comprehensive income (loss) | ||||||||||||||||||||
| for the period | - | 8,704 | (17 | ) | 377 | 9,064 | - | 9,064 | ||||||||||||
| Total comprehensive income (loss) for the period | - | 8,704 | (17 | ) | 377 | 9,064 | 145,852 | 154,916 | ||||||||||||
| Transactions with owners, recorded directly in equity | ||||||||||||||||||||
| Dividends to shareholders of the Company | - | - | - | - | - | (63,576 | ) | (63,576 | ) | |||||||||||
| Balance at September 30, 2017 | $ | 99,283 | $ | (27,044 | ) | $ | - | $ | - | $ | (27,044 | ) | $ | 476,610 | $ | 548,849 | ||||
| CONSTELLATION SOFTWARE INC. | |||||||||||||||||||||
| Condensed Consolidated Interim Statements of Changes in Equity | |||||||||||||||||||||
| (In thousands of U.S. dollars) | |||||||||||||||||||||
| Unaudited | |||||||||||||||||||||
| Nine months ended September 30, 2016 | |||||||||||||||||||||
| Capital stock | Accumulated other comprehensive income/(loss) | Total accumulated other comprehensive income/(loss) | Retained earnings | Total | |||||||||||||||||
| Cumulative translation account | Amounts related to gains/losses on available- for-sale financial assets | Amounts related to gains/(losses) on derivatives designed as hedges | |||||||||||||||||||
| Balance at January 1, 2016 | $ | 99,283 | $ | (33,614 | ) | $ | - | $ | (705 | ) | $ | (34,319 | ) | $ | 272,318 | $ | 337,282 | ||||
| Total comprehensive income for the period: | |||||||||||||||||||||
| Net income | - | - | - | - | - | 141,128 | 141,128 | ||||||||||||||
| Other comprehensive income (loss) | |||||||||||||||||||||
| Net change in fair value | |||||||||||||||||||||
| of available-for-sale financial | |||||||||||||||||||||
| asset during the period | - | - | 6,946 | - | 6,946 | - | 6,946 | ||||||||||||||
| Net change in fair value | |||||||||||||||||||||
| of derivatives designated as hedges | |||||||||||||||||||||
| during the period | - | - | - | 134 | 134 | - | 134 | ||||||||||||||
| Amounts reclassified to profit during the period | |||||||||||||||||||||
| related to realized losses (gains) on | |||||||||||||||||||||
| available-for-sale financial assets | - | (2,539 | ) | - | (2,539 | ) | - | (2,539 | ) | ||||||||||||
| Foreign currency translation differences from | |||||||||||||||||||||
| foreign operations | - | 4,301 | - | - | 4,301 | - | 4,301 | ||||||||||||||
| Deferred tax recovery (expense) | - | - | (545 | ) | (33 | ) | (578 | ) | - | (578 | ) | ||||||||||
| Total other comprehensive income for the period | - | 4,301 | 3,862 | 101 | 8,264 | - | 8,264 | ||||||||||||||
| Total comprehensive income for the period | - | 4,301 | 3,862 | 101 | 8,264 | 141,128 | 149,392 | ||||||||||||||
| Transactions with owners, recorded directly in equity | |||||||||||||||||||||
| Dividends to shareholders of the Company | - | - | - | - | (63,576 | ) | (63,576 | ) | |||||||||||||
| Balance at September 30, 2016 | $ | 99,283 | $ | (29,313 | ) | $ | 3,862 | $ | (604 | ) | $ | (26,055 | ) | $ | 349,870 | $ | 423,098 | ||||
| CONSTELLATION SOFTWARE INC. | ||||||||||||||||||
| Condensed Consolidated Interim Statements of Cash Flows | ||||||||||||||||||
| (In thousands of U.S. dollars) | ||||||||||||||||||
| Three and nine months ended September 30, 2017 and 2016 | ||||||||||||||||||
| Unaudited | ||||||||||||||||||
| Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||||
| Cash flows from operating activities: | ||||||||||||||||||
| Net income | $ | 54,269 | $ | 67,462 | $ | 145,852 | $ | 141,128 | ||||||||||
| Adjustments for: | ||||||||||||||||||
| Depreciation | 5,768 | 5,454 | 16,388 | 15,436 | ||||||||||||||
| Amortization of intangible assets | 59,829 | 42,676 | 167,852 | 131,987 | ||||||||||||||
| TSS membership liability revaluation charge | 11,781 | 7,070 | 40,311 | 13,937 | ||||||||||||||
| Share in net (income) loss of equity investee | (80 | ) | (5,410 | ) | (206 | ) | (5,717 | ) | ||||||||||
| Finance and other income | (1,291 | ) | (2,929 | ) | (1,720 | ) | (3,201 | ) | ||||||||||
| Bargain purchase gain | (5,008 | ) | - | (5,008 | ) | - | ||||||||||||
| Finance costs | 8,725 | 5,332 | 19,456 | 16,353 | ||||||||||||||
| Income tax expense (recovery) | 25,769 | 27,255 | 69,239 | 59,359 | ||||||||||||||
| Foreign exchange loss (gain) | 7,567 | (1,026 | ) | 10,926 | 24,778 | |||||||||||||
| Change in non-cash operating working capital | ||||||||||||||||||
| exclusive of effects of business combinations | (28,069 | ) | 2,038 | (28,421 | ) | (9,210 | ) | |||||||||||
| Income taxes paid | (16,539 | ) | (10,094 | ) | (69,517 | ) | (27,692 | ) | ||||||||||
| Net cash flows from operating activities | 122,721 | 137,828 | 365,152 | 357,158 | ||||||||||||||
| Cash flows from (used in) financing activities: | ||||||||||||||||||
| Interest paid | (5,572 | ) | (5,547 | ) | (16,707 | ) | (17,395 | ) | ||||||||||
| Increase (decrease) in New CNH Facility, net | 74,608 | - | 74,608 | - | ||||||||||||||
| Repayments of CNH facility | (134,248 | ) | - | (138,177 | ) | (4,495 | ) | |||||||||||
| Credit facility transaction costs | (1,942 | ) | - | (1,942 | ) | (1,212 | ) | |||||||||||
| Dividends paid | (21,192 | ) | (21,192 | ) | (63,576 | ) | (63,576 | ) | ||||||||||
| Net cash flows from (used in) in financing activities | (88,346 | ) | (26,739 | ) | (145,794 | ) | (86,678 | ) | ||||||||||
| Cash flows from (used in) investing activities: | ||||||||||||||||||
| Acquisition of businesses, net of cash | ||||||||||||||||||
| acquired | (41,863 | ) | (34,500 | ) | (156,062 | ) | (101,198 | ) | ||||||||||
| Post-acquisition settlement payments, net of receipts | (4,723 | ) | (12,050 | ) | (21,611 | ) | (18,283 | ) | ||||||||||
| Purchases of available-for-sale equity securities | - | (13,902 | ) | - | (26,596 | ) | ||||||||||||
| Proceeds from sale of available-for-sale equity securities | - | 14,276 | 2,828 | 14,276 | ||||||||||||||
| Interest, dividends and other proceeds received | 1,152 | 644 | 21,607 | 794 | ||||||||||||||
| Property and equipment purchased | (5,450 | ) | (3,934 | ) | (14,382 | ) | (13,621 | ) | ||||||||||
| Net cash flows from (used in) investing activities | (50,884 | ) | (49,466 | ) | (167,620 | ) | (144,628 | ) | ||||||||||
| Effect of foreign currency on | ||||||||||||||||||
| cash and cash equivalents | 1,331 | (143 | ) | 9,349 | 131 | |||||||||||||
| Increase (decrease) in cash and cash equivalents | (15,178 | ) | 61,480 | 61,087 | 125,983 | |||||||||||||
| Cash, beginning of period | 429,764 | 242,974 | 353,499 | 178,471 | ||||||||||||||
| Cash, end of period | $ | 414,586 | $ | 304,454 | $ | 414,586 | $ | 304,454 | ||||||||||