Mr. Alan Torrie reports
MORNEAU SHEPELL REPORTS 2014 FOURTH QUARTER AND 2014 FINANCIAL RESULTS
Morneau Shepell Inc. has released its financial results for 2014 (all amounts are in Canadian dollars, unless noted otherwise).
Highlights:
- A 13.7-per-cent increase in revenue to $535.9-million compared with $471.2-million for the year before;
- Record adjusted earnings before interest, taxes, depreciation and amortization and profit.
"The year 2014 was another strong year for Morneau Shepell," said Bill Morneau, executive chair of Morneau Shepell. "We continued to deliver a solid performance. We also expect that our continued investment in our business, our new acquisitions, our expansion in the U.S., and our established and prospective client base will continue to yield positive results for the company."
"I am satisfied with our performance in 2014," said Alan Torrie, president and chief executive officer of Morneau Shepell. "We delivered strong revenue growth of 13.7 per cent compared to the year before, with solid organic growth, particularly in the U.S. market and our administrative solutions business, supplemented by strategic tuck-in acquisitions. Our Q4 2014 revenue increased by a solid 10.6 per cent to $131.2-million, compared to $118.6-million for the comparative period in 2013."
Mr. Torrie added: "Organic revenue for 2014 grew by 10.0 per cent across our four lines of business. We also achieved a milestone in 2014, with our revenue surpassing $500-million. In the U.S., where we act as a services platform provider to new U.S. health insurance exchanges, revenue grew by 30 per cent over the comparative period. We expect this market to continue to provide long-term growth opportunities for the company."
FINANCIAL REVIEW
(in thousands of dollars)
Three months ended Three months ended Year ended Year ended
Dec. 31, 2014 Dec. 31, 2013 Dec. 31, 2014 Dec. 31, 2013
Revenue $131,195 $118,570 $535,866 $471,154
Adjusted EBITDA $22,581 $20,217 $98,927 $86,528
Adjusted EBITDA margin 17.2% 17.1% 18.5% 18.4%
Normalized free cash flow $13,446 $15,939 $50,530 $53,979
Profit (loss) $461 $(11,279) $25,140 $10,445
For the year ended Dec. 31, 2014, the company reported $535.9-million in revenue, an increase of $64.7-million or 13.7 per cent from $471.2-million for the year ended Dec. 31, 2013. Organic revenue grew by 10.0 per cent, including an increase for all four lines of business.
Adjusted EBITDA of $98.9-million increased by $12.4-million over $86.5-million in 2013. Adjusted EBITDA margin was 18.5 per cent, slightly higher than 18.4 per cent in 2013. For the fourth quarter, adjusted EBITDA margin was 17.2 per cent compared with 17.1 per cent for the comparative quarter in 2013.
Total operating expenses (excluding depreciation, amortization and impairment losses) were $452.0-million in 2014, compared with $394.9-million in 2013. Profit for the year in 2014 was $25.1-million, compared with $10.4-million in 2013.
Normalized free cash flow
Normalized free cash flow for the year ended Dec. 31, 2014, decreased slightly by $3.4-million to $50.5-million compared with $54.0-million for 2013. The decrease is primarily a result of higher capital expenditures, which were offset by higher cash provided by operating activities.
Annual meeting of shareholders
Morneau Shepell announced that it will hold its 2014 annual meeting of shareholders on May 12, 2015, in Toronto, Ont., and it established a record date of March 19, 2015, for the meeting.
Notice of conference call
Management of Morneau Shepell will host a conference call on March 3, 2015, at 1 p.m. ET. The conference call is open to all those wishing to attend, with a question-and-answer period to follow the presentation. To participate in the live conference call, please call 416-340-2217 (participant code 2809543) in the Toronto area, or 1-866-696-5910 (participant code 2809543) throughout the rest of Canada. A replay of the call will be available on the Morneau Shepell website.
We seek Safe Harbor.
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