Constellation Software Inc. And Topicus.Com Inc. Announce Results For Topicus.Com Inc. For The Second Quarter Ended June 30, 2024

(MENAFN- GlobeNewsWire - Nasdaq) TORONTO, Aug. 01, 2024 (GLOBE NEWSWIRE) -- Topicus.com Inc. (TSXV:TOI) in a joint release with Constellation Software Inc. (TSX:CSU) today announced financial results for Inc. (“Topicus” or the“Company”) for the second quarter ended June 30, 2024. Please note that all amounts referred to in this press release are in Euros 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 six months ended June 30, 2024 and the accompanying notes, our Management's Discussion and Analysis for the three and six months ended June 30, 2024 and the Annual Consolidated Financial Statements of Inc. for the year ended December 31, 2023, which we prepared in accordance with International Financial Reporting Standards (“IFRS”) and the Company's annual Management's Discussion and Analysis for the year ended December 31, 2023, which can be found on SEDAR+ at and on Inc.'s website Additional information about Inc. is also available on SEDAR+ at .

Q2 2024 Headlines:

• Revenue increased 14% (4% organic growth) to €311.2 million compared to €272.1 million in Q2 2023.
• Net income increased 15% to €26.9 million (€0.21 on a diluted per share basis) from €23.5 million (€0.18 on a diluted per share basis).
• Acquisitions were completed for aggregate cash consideration of €10.3 million (which includes acquired cash). Deferred payments associated with these acquisitions have an estimated value of €6.3 million resulting in total consideration of €16.6 million.
• Cash flows from operations (“CFO”) increased €24.2 million to €8.8 million compared to negative €15.4 million in Q2 2023.
• Free cash flow available to shareholders1 (“FCFA2S”) increased €12.8 million to negative €3.8 million compared to negative €16.6 million in Q2 2023.
  

Total revenue for the quarter ended June 30, 2024 was €311.2 million, an increase of 14%, or €39.1 million, compared to €272.1 million for the comparable period in 2023. For the first six months of 2024 total revenues were €617.8 million, an increase of 15%, or €81.2 million, compared to €536.5 million for the comparable period in 2023. The increase for both the three and six-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% for each of the periods. Organic growth is not a standardized financial measure and might not be comparable to measures disclosed by other issuers.

Net income for the quarter ended June 30, 2024 increased €3.5 million to €26.9 million compared to €23.5 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.21 in the quarter ended June 30, 2024 compared to net income per basic and diluted share of €0.18 for the same period in 2023. For the six months ended June 30, 2024 net income increased €10.7 million to €55.2 million compared to €44.6 million for the same period in 2023. On a per share basis, this translated into net income per basic and diluted share of €0.43 in the six months ended June 30, 2024 compared to €0.35 for the same period in 2023.

For the quarter ended June 30, 2024, CFO were €8.8 million compared to negative €15.4 million for the same period in 2023. For the six months ended June 30, 2024, CFO increased €77.7 million to €236.3 million compared to €158.6 million for the same period in 2023 representing an increase of 49%.

For the quarter ended June 30, 2024, FCFA2S was negative €3.8 million compared to negative €16.6 million for the same period in 2023. For the six months ended June 30, 2024, FCFA2S increased €45.6 million to €130.1 million compared to €84.5 million for the same period in 2023 representing an increase of 54%.

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 Topicus 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 Topicus 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, dividends paid to redeemable preferred securities holders, and property and equipment purchased, and includes interest and dividends received, and the proceeds from sale of interest rate caps. The portion of this amount applicable to non-controlling interests is then deducted. Topicus believes that FCFA2S is useful supplemental information as it provides an indication of the uncommitted cash flow that is available to shareholders if Topicus does not make any acquisitions, or investments, and does not repay any debts. While Topicus could use the FCFA2S to pay dividends or repurchase shares, Topicus' objective is to invest all of our FCFA2S in acquisitions which meet Topicus' 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 June 30,				Six months ended June 30,
			2024		2023					2024		2023
		(€ in millions)		(€ in millions)
Net cash flows from operating activities			8.8		(15.4	)				236.3		158.6
Adjusted for:
Interest paid on lease obligations			(0.5	)	(0.3	)				(0.9	)	(0.7	)
Interest paid on other facilities			(6.7	)	(3.5	)				(9.9	)	(6.6	)
Credit facility transaction costs			(0.3	)	(0.2	)				(0.3	)	(0.2	)
Payments of lease obligations			(6.1	)	(5.5	)				(11.9	)	(10.8	)
Property and equipment purchased			(1.8	)	(1.9	)				(4.4	)	(3.9	)
			(6.6	)	(26.8	)				208.8		136.5
Less amount attributable to
non-controlling interests			2.8		10.2					(78.7	)	(52.0	)
Free cash flow available to shareholders			(3.8	)	(16.6	)				130.1		84.5
Due to rounding, certain totals may not foot.

About Inc.

Topicus' subordinate voting shares are listed on the Toronto Venture Stock Exchange under the symbol "TOI". Topicus acquires, manages and builds vertical market software businesses.

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
...

S OURCE: INC.

Inc.
Condensed Consolidated Interim Statements of Financial Position
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
			June 30, 2024	December 31, 2023	June 30, 2023
Assets
Current assets:
	Cash		233,749	179,059	172,315
	Accounts receivable		121,629	134,079	130,456
	Unbilled revenue		47,740	44,838	48,701
	Inventories		4,970	4,517	4,268
	Other assets		62,955	55,250	54,657
			471,043	417,742	410,396
Non-current assets:
	Property and equipment		21,007	20,030	20,372
	Right of use assets		62,147	61,066	57,919
	Deferred income taxes		21,089	16,412	8,288
	Other assets		13,130	13,824	12,161
	Intangible assets	933,837	906,082	935,300
			1,051,209	1,017,415	1,034,041
Total assets		1,522,252	1,435,157	1,444,437
Liabilities and Shareholders' Equity
Current liabilities:
	Topicus Revolving Credit Facility and current portion of term and other loans	246,155	161,077	168,228
	Loan from CSI		-	-	30,281
	Accounts payable and accrued liabilities		177,887	211,423	162,868
	Deferred revenue		279,338	138,854	241,980
	Provisions		1,638	1,708	1,682
	Acquisition holdback payables		15,270	12,292	14,878
	Lease obligations		21,749	20,614	19,280
	Income taxes payable		20,616	20,068	16,510
			762,653	566,035	655,707
Non-current liabilities:
	Term and other loans		89,880	64,615	65,807
	Deferred income taxes		145,807	137,155	140,684
	Acquisition holdback payables		7,069	1,339	1,289
	Lease obligations		41,478	41,524	39,684
	Other liabilities		38,491	32,005	27,219
			322,726	276,639	274,682
Total liabilities		1,085,379	842,674	930,388
Shareholders' Equity:
	Capital stock		39,412	39,412	39,412
	Accumulated other comprehensive income (loss)		3,667	2,390	851
	Retained earnings (deficit)		208,991	297,382	255,528
	Non-controlling interests		184,802	253,299	218,258
			436,873	592,483	514,048
Total liabilities and shareholders' equity		1,522,252	1,435,157	1,444,437

Inc.
Condensed Consolidated Interim Statements of Income (Loss)
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
			Three months ended June 30,		Six months ended June 30,
			2024			2023			2024			2023
Revenue
License		8,169			7,847			17,334			14,825
Professional services		79,308			71,974			154,314			141,314
Hardware and other		5,037			3,705			10,588			6,385
Maintenance and other recurring		218,674			188,557			435,522			373,989
			311,189			272,083			617,757			536,513
Expenses
Staff		177,462			155,841			350,577			305,949
Hardware		3,570			2,545			8,190			4,123
Third party license, maintenance and professional services	23,705			21,340			47,056			41,888
Occupancy		2,679			2,560			5,389			5,026
Travel, telecommunications, supplies, software and equipment	12,904			10,703			24,887			20,267
Professional fees		5,183			4,557			10,274			8,837
Other, net		4,060			964			8,365			7,178
Depreciation		8,438			7,695			16,450			14,990
Amortization of intangible assets		33,410			29,985			65,082			57,946
			271,409			236,191			536,271			466,204
Impairment of intangible and other non-financial assets	0			-			633			-
Bargain purchase (gain)		-			-			(323	)		-
Finance and other expenses (income)		6,435			4,447			11,433			9,396
			6,435			4,447			11,744			9,396
Income (loss) before income taxes		33,344			31,445			69,742			60,912
Current income tax expense (recovery)		13,447			14,898			28,530			27,226
Deferred income tax expense (recovery)		(7,041	)		(6,905	)		(14,039	)		(10,894	)
Income tax expense (recovery)		6,406			7,993			14,491			16,332
Net income (loss)		26,938			23,452			55,252			44,580
Net income (loss) attributable to:
Equity holders of Topicus		17,018			14,572			35,107			28,472
Non-controlling interests		9,920			8,880			20,145			16,108
Net income (loss)		26,938			23,452			55,252			44,580
Weighted average shares
	Basic shares outstanding		82,883,874			81,889,764			82,539,759			81,889,764
	Diluted shares outstanding		129,841,819			129,841,819			129,841,819			129,841,819
Earnings (loss) per common share of Topicus
	Basic		0.21			0.18			0.43			0.35
	Diluted		0.21			0.18			0.43			0.35

Inc.
Condensed Consolidated Interim Statements of Comprehensive Income (Loss)
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
		Three months ended June 30,		Six months ended June 30,
		2024		2023		2024		2023
Net income (loss)		26,938		23,452		55,252		44,580
Items that are or may be reclassified subsequently to net income (loss):
Foreign currency translation differences from foreign operations and other	1,244		2,999		3,170		2,203
Other comprehensive (loss) income for the period, net of income tax	1,244		2,999		3,170		2,203
Total comprehensive income (loss) for the period	28,182		26,451		58,422		46,784
Total other comprehensive income (loss) attributable to:
Equity holders of Topicus		651		1,320		1,277		1,083
Non-controlling interests		593		1,679		1,894		1,120
Total other comprehensive income (loss)		1,244		2,999		3,170		2,203
Total comprehensive income (loss) attributable to:
Equity holders of Topicus		17,670		15,892		36,383		29,555
Non-controlling interests		10,513		10,559		22,038		17,228
Total comprehensive income (loss)		28,182		26,451		58,422		46,784

Inc.
Condensed Consolidated Interim Statement of Changes in Shareholders' Equity (Deficiency)
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
Six months ended June 30, 2024
		Capital Stock	Accumulated other comprehensive (loss) income	Retained earnings (Deficit)	Total	Non-controlling interests	Total equity
Balance at January 1, 2024	39,412	2,390	297,382		339,185		253,299		592,483
Total comprehensive income (loss) for the period:
Net income (loss)	-	-	35,107		35,107		20,145		55,252
Other comprehensive income (loss)
Foreign currency translation differences from
	foreign operations and other, net of income tax	-	1,277	-		1,277		1,894		3,170
Total other comprehensive income (loss)
	for the period	-	1,277	-		1,277		1,894		3,170
Total comprehensive income (loss) for the period	-	1,277	35,107		36,383		22,038		58,422
Transactions with owners, recorded directly in equity
	Other movements in non-controlling interests and equity	-	-	(91	)	(91	)	(64	)	(155	)
	Exchange of Topicus Coop ordinary units held by non-controlling interests to subordinate voting shares of Topicus	-	-	4,235		4,235		(4,235	)	-
	Dividends paid to shareholders of the Company	-	-	(127,641	)	(127,641	)	-		(127,641	)
	Return of capital to non-controlling interests					(9,048	)	(9,048	)
	Dividends paid to non-controlling interests	-	-	-		-		(77,188	)	(77,188	)
Balance at June 30, 2024	39,412	3,667	208,991		252,071		184,802		436,873

Inc.
Condensed Consolidated Interim Statement of Changes in Shareholders' Equity (Deficiency)
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
Six months ended June 30, 2023
			Capital Stock	Accumulated other comprehensive (loss) income	Retained earnings (deficit)	Total	Non-controlling interests	Total equity
Balance at January 1, 2023	39,412	(232	)	226,919	266,099	201,685		467,784
Total comprehensive income (loss) for the period:
Net income (loss)	-	-		28,472	28,472	16,108		44,580
Other comprehensive income (loss)
Foreign currency translation differences from
	foreign operations and other, net of income tax	-	1,083		-	1,083	1,120		2,203
Total other comprehensive income (loss) for the period	-	1,083		-	1,083	1,120		2,203
Total comprehensive income (loss) for the period	-	1,083		28,472	29,555	17,228		46,784
Transactions with owners, recorded directly in equity
	Other movements in non-controlling interests and equity	-	-		137	137	70		207
	Dividends paid to non-controlling interests	-	-		-	-	(726	)	(726	)
Balance at June 30, 2023	39,412	851		255,528	295,791	218,258		514,048

Inc.
Condensed Consolidated Interim Statements of Cash Flows
(In thousands of euros, except per share amounts. Due to rounding, numbers presented may not foot.)
Unaudited
				Three months ended June 30,		Six months ended June 30,
				2024			2023			2024			2023
Cash flows from (used in) operating activities:
	Net income (loss)		26,938			23,452			55,252			44,580
	Adjustments for:
		Depreciation		8,438			7,695			16,450			14,990
		Amortization of intangible assets	33,410			29,985			65,082			57,946
		Impairment of intangible and other non-financial assets		0			-			633			-
		Bargain purchase (gain)		-			-			(323	)		-
		Finance and other expenses (income)		6,435			4,447			11,433			9,396
		Income tax expense (recovery)	6,406			7,993			14,491			16,332
	Change in non-cash operating assets and liabilities
		exclusive of effects of business combinations	(58,970	)		(75,465	)		96,038			41,134
	Income taxes (paid) received	(13,849	)		(13,474	)		(22,749	)		(25,752	)
	Net cash flows from (used in) operating activities	8,809			(15,367	)		236,306			158,626
Cash flows from (used in) financing activities:
	Interest paid on lease obligations		(481	)		(347	)		(937	)		(653	)
	Interest paid on other facilities		(6,727	)		(3,505	)		(9,888	)		(6,565	)
	Proceeds from sale of interest rate cap		-			5,516			-			5,516
	Net increase (decrease) in Topicus Revolving Credit Facility	(20,000	)		45,000			85,000			35,000
	Proceeds from issuance of term and other loans	28,917			21,941			29,733			26,218
	Increase (decrease) in loan from Vela Software Group		-			(468	)		-			(468	)
	Return of capital to non-controlling interests		(9,048	)		-			(9,048	)		-
	Repayments of term and other loans	(1,983	)		(4,497	)		(5,667	)		(72,941	)
	Credit facility transaction costs	(314	)		(175	)		(314	)		(238	)
	Payments of lease obligations		(6,116	)		(5,543	)		(11,933	)		(10,805	)
	Dividends paid to non-controlling interests		(2,649	)		(726	)		(77,188	)		(726	)
	Dividends paid to shareholders of the Company		-			-			(127,641	)		-
	Net cash flows from (used in) in financing activities	(18,401	)		57,197			(127,884	)		(25,663	)
Cash flows from (used in) investing activities:
	Acquisition of businesses	(10,289	)		(63,252	)		(46,831	)		(88,048	)
	Cash obtained with acquired businesses		5,095			4,611			12,119			5,583
	Post-acquisition settlement payments, net of receipts	(5,019	)		(6,567	)		(9,233	)		(11,055	)
	(Increase) decrease in restricted cash		-			-			(6,000	)		-
	Property and equipment purchased	(1,751	)		(1,888	)		(4,406	)		(3,869	)
	Net cash flows from (used in) investing activities	(11,964	)		(67,096	)		(54,350	)		(97,388	)
Effect of foreign currency on
	cash and cash equivalents	706			317			618			(31	)
Increase (decrease) in cash	(20,850	)		(24,950	)		54,690			35,543
Cash, beginning of period	254,599			197,265			179,059			136,772
Cash, end of period	233,749			172,315			233,749			172,315

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