Mr. Robert Courteau reports

ALTUS GROUP REPORTS STRONG FOURTH QUARTER AND 2014 FINANCIAL RESULTS

Altus Group Ltd. has released its financial and operating results for the fourth quarter and year ended Dec. 31, 2014.

Full-year 2014 financial highlights:

• Increased gross revenues by 14.1 per cent to $370.2-million (from $324.4-million in 2013), driven by double-digit revenue growth from Research, Valuation and Advisory, Argus Software, Property Tax Consulting, and Geomatics;
• Increased adjusted earnings before interest, taxes, depreciation and amortization by 16.9 per cent to $67.1-million (from $57.4-million in 2013), increasing margins to 18.1 per cent while continuing to make investments (compared with 17.7 per cent in 2013);
• Maintained strong organic growth, which contributed 7.3 per cent to gross revenues and 4.8 per cent to adjusted EBITDA;
• Completed four acquisitions during the year, which contributed 6.8 per cent to revenue growth and 12.1 per cent to adjusted EBITDA growth while furthering Altus Group's long-term strategy;
• Strengthened offerings for global asset and investment management clients with enhanced data and software platforms, driving 20.8-per-cent revenue growth from GAIM businesses;
• Increased revenue contribution from new geographies, with 41.9 per cent of revenue now sourced from outside of the core Canadian market (compared with 35.3 per cent in 2013);
• Increased adjusted basic earnings per share to $1.16 (compared with $1.14 in 2013);
• Returned $18.3-million to shareholders through quarterly declared dividends of 15 cents per common share, or 60 cents per share for the year.

Fourth quarter 2014 financial highlights:

• Increased gross revenues by 12.6 per cent to $100.9-million (from $89.6-million in the fourth quarter of 2013);
• Sustained double-digit revenue growth from RVA, Argus Software and Geomatics;
• Increased adjusted EBITDA by 12.8 per cent to $18.8-million (from $16.7-million in the fourth quarter of 2013);
• Completed the acquisitions of Voyanta Ltd. and SC&H Group Inc.'s state and local tax consultancy;
• Adjusted basic earnings per share were 31 cents (consistent with the fourth quarter of 2013).

"The strong performance in the fourth quarter and 2014 reflects the strength of our strategy and the investments we undertook to position Altus Group for profitable growth," said Robert Courteau, chief executive officer at Altus Group. "Our strategic focus on international expansion resulted in an enhanced global footprint and important new customer wins. In addition, our investments in our global asset and investment management offerings drove strong growth from our data and software platforms. Driven by both organic and acquisitive growth, we finished the year with solid improvements across all of our business units. With a solid foundation in place, supported by strong leadership and operating plans, we are well positioned to continue growing profitability in 2015."

Summary of operating and financial performance:

All percentage increases and decreases represent year-over-year changes for the fourth quarter and year-end results from 2014, compared with the fourth quarter and year-end results from 2013, unless otherwise noted.

Full-year review 2014

Altus Group's organic growth initiatives, acquisitions and strong operational execution drove double-digit year-over-year increases in gross revenues and adjusted EBITDA in 2014. On a consolidated basis, gross revenues increased 14.1 per cent to $370.2-million (compared with $324.4-million for the same period in 2013), and adjusted EBITDA increased 16.9 per cent to $67.1-million (from $57.4-million in the same period last year), achieving an adjusted EBITDA margin of 18.1 per cent.

Revenue growth was driven by an 18.3-per-cent year-over-year increase from RVA, a 25.8-per-cent increase from Argus Software, a 12.2-per-cent increase from Property Tax and a 20.2-per-cent increase from Geomatics. During the year, acquisitions contributed 6.8 per cent to revenue growth, and exchange rate improvements against the Canadian dollar benefited revenues by 2.6 per cent.

• RVA benefited from a 29.7-per-cent increase from its Data Solutions, which included the acquisitions of RealNet Canada Inc. and Voyanta, and new appraisal management clients in the United States and Europe. Valuations and Advisory Services also improved by 11.2 per cent, driven by right-of-way and economic advisory services.
• Argus Software sustained strong revenue growth driven by the continued adoption of its Argus Enterprise platform. During the year, licence sales increased by 47.0 per cent, maintenance revenue increased by 19.3 per cent, services revenues increased by 7.4 per cent and favourable exchange rates against the Canadian dollar improved revenues by 7.8 per cent.
• Geomatics's strong performance was attributed to the integration of Maltais Geomatics Inc., acquired in April, 2014. Compared with 2013, Geomatics benefited from optimized crew utilization and increased work from the electric power and industrial segments.
• Property Tax performed well in North America, benefiting from organic and acquisitive growth in the U.S., as well as favourable exchange rates against the Canadian dollar.
• The Cost Consulting and Project Management practice saw modest revenue declines both in North America and the Asia Pacific; however, it continues to see a positive trend in improving earnings.

Adjusted EBITDA results reflect improved revenue performance driven by 12.1 per cent of acquisition growth, improvements in exchange rates against the Canadian dollar by 4.1 per cent and operational expense improvements in the Cost business. Adjusted EBITDA was predominantly impacted by investments that were made to expand RVA into Europe and by the purchase of Voyanta. Corporate costs amounted to $14.6-million, compared with $14.8-million in 2013.

Under international financial reporting standards accounting, profit (loss) for the year was $13.2-million, down 29.2 per cent or $5.4-million from $18.6-million from 2013.

At the end of the year, the company's bank debt was $127.5-million, representing a financed debt to EBITDA leverage ratio of 1.73 times, well within the company's current covenant limit of 2.75 times. At the end of the year, Altus Group's balance sheet remained strong, giving the company the financial flexibility to pursue its growth strategy. In the ordinary course, the company is close to finalization of a new credit agreement.

Fourth quarter 2014 review

On a consolidated basis, gross revenues increased 12.6 per cent to $100.9-million (compared with $89.6-million for the same period in 2013), and adjusted EBITDA increased 12.8 per cent to $18.8-million (from $16.7-million in the same period last year), achieving a quarterly adjusted EBITDA margin of 18.7 per cent. Revenue growth was driven by a 29.3-per-cent year-over-year increase from RVA, a 25.2-per-cent increase from Argus Software and a 17.7-per-cent increase from Geomatics.

• Growth at RVA was driven by a 61.4-per-cent increase in revenues from Data Solutions (to which RealNet and Voyanta contributed 30.5 per cent), an 8.8-per-cent growth in revenues from Valuations and Advisory Services, and a favourable exchange rate against the Canadian dollar. Investments in the expansion into Europe and the acquisition of Voyanta impacted adjusted EBITDA by 39.0 per cent. Additionally, variable compensation awarded at year-end impacted earnings in the quarter. In the prior year, the operations also benefited from $300,000 of media tax credits.
• Growth at Argus Software was driven by a 44.5-per-cent increase in licence sales (typically the strongest quarter in the year) and an 18.6-per-cent increase in maintenance revenue, as well as favourable exchange rates against the Canadian dollar. Adjusted EBITDA remained flat with the prior year resulting from additional resource investments aimed at future growth. Additionally, annual variable compensation awarded at year-end impacted earnings in the quarter by an incremental 9.4 per cent.
• Property Tax revenues declined slightly, but benefited however from steady organic growth in the U.S., as well as acquisitive growth from SC&H SALT and favourable exchange rates. Earnings were impacted by continued investments in the U.S. and reduced revenues from the United Kingdom, some of which were offset by acquisitive earnings and favourable exchange rates against the Canadian dollar.
• At the Cost business unit, revenues improved modestly in Asia Pacific, and revenues in Canada were impacted by a marginal reduction experienced in Western Canada; however, increased operational efficiencies resulted in improved earnings.
• The strong growth in revenue and in earnings at Geomatics was driven by MGI, which enhanced crew utilization and broadened industry exposure.

In the fourth quarter, corporate costs were a positive $4.1-million, compared with a positive $600,000 in the same period in 2013. In the first nine months of the year, bonuses were recorded in the corporate segment, subject to the overall finalization of bonuses at year-end. In the fourth quarter, bonuses were allocated to the business units and resulted in the positive balance. Compared with the same period in 2013, higher variable compensation was recorded during the first nine months of the year due to improved performance in the businesses, which resulted in the higher positive balance.

Under international financial reporting standards accounting, profit (loss) for the fourth quarter was $5.1-million, or 16 cents per share, basic and diluted, compared with $7.0-million, or 26 cents per share, basic, and 24 cents per share, diluted, in the same period in 2013.

   Q4 AND FISCAL 2014 RESULTS CONFERENCE CALL AND WEBCAST                        
                                                                            
Date          Feb. 24, 2015                                    
Time          5 p.m. ET                                                  
Webcast       The Altus Group website (under investor relations)         
Live call     1-866-225-0198 (toll-free) or 416-340-2218 (GTA and             
              international)                                                
Replay        1-800-408-3053 or 905-694-9451 (passcode 6634231)            

          CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) 
 (expressed in thousands of Canadian dollars, except for per-share amounts)

                                                  For the year  For the year
                                                         ended         ended
                                                       Dec. 31,      Dec. 31,
                                                          2014          2013
Revenues
Gross revenues                                     $   370,202   $   324,449
Less: disbursements                                     30,006        27,285
Net revenue                                            340,196       297,164
Expenses
Employee compensation                                  221,403       191,099
Occupancy                                               14,603        13,676
Office and other operating                              38,913        36,409
Amortization of intangibles                             18,321        13,515
Depreciation of property, plant and equipment            5,841         4,917
Acquisition-related expenses (income)                    3,477           718
Share of (profit) loss of associates                     1,421         1,415
Restructuring costs                                        128         2,916
(Gain) loss on sale of certain business assets              --        (8,832)
Operating profit (loss)                                 36,089        41,331
Finance costs (income), net                             17,384        18,388
Profit (loss) before income taxes                       18,705        22,943
Income tax expense (recovery)                            5,534         4,336
Profit (loss) for the year attributable to equity-
holders                                            $    13,171   $    18,607
Other comprehensive income (loss)
Items that may be reclassified to profit or (loss)
in subsequent periods
Cash flow hedges                                           740           836
Currency translation differences                        11,841         9,614
Share of other comprehensive income (loss) of
associates                                                 339           (43)
Other comprehensive income (loss), net of tax           12,920        10,407
Total comprehensive income (loss) for the year,
net of tax, attributable to equityholders          $    26,091   $    29,014
Earnings (loss) per share attributable to the
equityholders of the company during the year
Basic earnings (loss) per share                    $      0.44   $      0.77
Diluted earnings (loss) per share                  $      0.43   $      0.71

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