First quarter highlights:
-
Revenues of $295 million, up 11%
-
Net income of $34 million, up 183%
-
Net income per share of $0.39, up 164%
-
Quarterly dividend of $0.32 per share
-
Adjusted revenues1 of $297 million, up 8%
-
Adjusted EBITDA1 of $87 million, up 10%
-
Adjusted net income1 of $47 million, up 22%
-
Adjusted net income per share1 of $0.55, up 14%
TORONTO, April 28, 2015 /CNW/ - DH Corporation (TSX:DH) ("D+H" or the
"Company"), a leading provider of technology solutions to domestic and
global financial institutions, today reported its financial results for
the three months ended March 31, 2015.
"First quarter results were in line with our expectations driven by
growth in our Canadian lending business and solid U.S. sales
performance in both lending and integrated core, coupled with a strong
U.S. dollar," said D+H Chief Executive Officer Gerrard Schmid. "Looking
ahead, we remain focused on continuing to drive organic growth across
all of our businesses, and following the closing of the Fundtech
acquisition, capitalizing on the various growth opportunities from our
expanded capabilities and global scale."
First Quarter Highlights
-
Revenues increased 11% to $295 million from $266 million in the same
quarter in 2014. Adjusted revenues totalled $297 million, an increase of $21 million, or 8%, over the same
quarter in 2014. Excluding the impact of foreign exchange, Adjusted
revenues increased 2% for the first quarter with the Canadian Segment
increasing by 5% and the U.S. Segment decreasing by 1%.
-
Adjusted EBITDA increased 10% to $87 million (29% margin) from $79
million (29% margin) compared to the same quarter in 2014. Excluding
the impact of foreign exchange, Adjusted EBITDA increased 4% for the
first quarter.
-
Net income increased to $34 million ($0.39 per share, basic and
diluted), from $12 million ($0.15 per share, basic and diluted) in the
same quarter in 2014.
-
Adjusted net income increased 22% to $47 million from $39 million in the same quarter in
2014. Adjusted net income per share increased 14% to $0.55 from $0.48
in the same quarter in 2014.
_______________________________
1 Non-IFRS measure. See the "Use of Non-IFRS Financial Information"
section of this press release for further details.
First Quarter 2015 Highlights
Selected Financial Information
(C$ millions unless otherwise indicated, unaudited)
|
Three months ended
March 31
|
|
2015
|
2014
|
|
Revenues
|
$295.0
|
$266.3
|
|
Adjusted revenues1
|
$296.5
|
$275.7
|
|
EBITDA1
|
$94.0
|
$69.0
|
|
Adjusted EBITDA1
|
$87.0
|
$78.7
|
|
Adjusted EBITDA margin1
|
29%
|
29%
|
|
Net income
|
$34.0
|
$12.0
|
|
Adjusted net income1
|
$47.4
|
$38.8
|
|
Net income per share, basic and diluted (C$)
|
$0.39
|
$0.15
|
|
Adjusted net income per share1 (C$)
|
$0.55
|
$0.48
|
Revenues by Segment and Service Area2, 3
(C$ millions, unaudited)
|
Three months ended March 31
|
|
Canadian Segment
|
U.S. Segment
|
Consolidated
|
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|
Lending solutions
|
$83.5
|
$75.4
|
$74.6
|
$60.4
|
$158.1
|
$135.8
|
|
Payments solutions
|
73.7
|
74.7
|
-
|
-
|
73.7
|
74.7
|
|
Enterprise solutions
|
-
|
-
|
63.2
|
55.8
|
63.2
|
55.8
|
|
Total Revenues
|
$157.3
|
$150.1
|
$137.7
|
$116.2
|
$295.0
|
$266.3
|
Adjusted revenues1 by Segment and Service Area2,3
(C$ millions, unaudited)
|
Three months ended March 31
|
|
Canadian Segment
|
U.S. Segment
|
Consolidated
|
|
2015
|
2014
|
2015
|
2014
|
2015
|
2014
|
|
Lending solutions
|
$83.5
|
$75.4
|
$75.9
|
$68.7
|
$159.5
|
$144.2
|
|
Payments solutions
|
73.7
|
74.7
|
-
|
-
|
73.7
|
74.7
|
|
Enterprise solutions
|
-
|
-
|
63.3
|
56.9
|
63.3
|
56.9
|
|
Total Adjusted revenues1
|
$157.3
|
$150.1
|
$139.3
|
$125.7
|
$296.5
|
$275.7
|
U.S. Segment revenues2,3
(US$ millions, unaudited)
|
Three months ended
March 31
|
|
2015
|
2014
|
|
Lending solutions
|
$60.0
|
$54.7
|
|
Enterprise solutions
|
50.9
|
50.5
|
|
U.S. Segment revenues
|
$110.9
|
$105.2
|
U.S. Segment Adjusted revenues1,2,3
(US$ millions, unaudited)
|
Three months ended
March 31
|
|
2015
|
2014
|
|
Lending solutions
|
$61.1
|
$62.3
|
|
Enterprise solutions
|
51.0
|
51.5
|
|
U.S. Segment Adjusted revenues1
|
$112.2
|
$113.8
|
1 Non-IFRS measure. See the "Use of Non-IFRS Financial Information"
section of this press release for further details.
2 Totals may not sum due to rounding.
3 Effective October 1, 2014, revenues reported as 'lending solutions'
comprise of 'lending processing solutions' and 'banking technology
solutions - lending' as reported in prior periods. Revenues reported as
'enterprise solutions' comprise of 'banking technology solutions -
enterprise' as reported in prior periods.
Dividend Reinvestment Plan
On January 14, 2015, the Company announced the adoption of a Dividend
Reinvestment Plan which became effective in the first quarter of 2015.
The Dividend Reinvestment Plan participation rate for the first quarter
of 2015 was approximately 25% of outstanding D+H shares. The dividend
declared by D+H in the second quarter of 2015, as described in the
"Dividend" section of this press release below, will also be eligible
for the Dividend Reinvestment Plan.
At this time, the Company intends to have these common shares issued
from treasury at a 4% discount to the weighted average trading price of
the common shares on the TSX during the five trading days immediately
preceding the dividend payment date. The 4% discount will remain in
effect for all cash dividends that may be declared, if any, by the
Company's Board of Directors until otherwise announced. To participate
in the Dividend Reinvestment Plan, eligible shareholders should refer
to plan information on the D+H website at dh.com. Eligible
shareholders who have not previously registered must register on or
before June 1, 2015, the dividend record date, to participate in the
program for the dividend payable on June 30, 2015.
SUBSEQUENT EVENTS
Acquisition of Fundtech
On March 30, 2015, D+H announced its intention to acquire all of the
outstanding shares of Fundtech, subject to regulatory approval, for a
purchase price of US$1.25 billion. The Company has received the
requisite regulatory approval and expects to close the transaction on
April 30, 2015.
Fundtech is a leading provider of financial technology to banks and
corporations of all sizes in the Americas, EMEA (Europe, Middle East
and Africa), and APAC (Asia and Pacific) regions with approximately
1,500 employees and 19 offices worldwide, including development centers
in the United States, India, Israel, Switzerland and the United
Kingdom. Fundtech's solutions are mission-critical to the day-to-day
operations of banks and corporate clients. Fundtech offers a
comprehensive line of transaction banking solutions including global
and domestic payments solutions, financial messaging, corporate cash
and liquidity management and merchant services. Fundtech has
approximately 1,200 clients, including global money center banks,
mid-sized banks and credit unions, non-bank financial institutions,
central banks and corporates.
The acquisition is expected to be funded through a combination of
approximately $720.1 million from issuance of 18,975,000 subscription
receipts of common shares at a price of $37.95; and $230 million from
issuance of 5.0%, 5.5 year, extendible convertible unsecured
subordinated debentures at the conversion price of $52.75; US$80
million senior secured guaranteed notes of 4.32% with a term of 7
years; US$245 million non-revolving, non-amortizing secured credit
facility maturing in 5 years; and the balance of the purchase price
will be financed through D+H's revolving credit facility.
D+H will also replace its current $450 million revolving, non-amortizing
term credit facility with a new $550 million revolving, non-amortizing
five-year term credit facility.
The financing includes exercise of the overallotments for both the
subscription receipts and convertible debentures.
Dividend
DH Corporation today announced that its Board of Directors has declared
a quarterly dividend of $0.32 per common share payable on June 30,
2015, to shareholders of record at the close of business on June 1,
2015. The dividend is an eligible dividend for Canadian income tax
purposes.
OUTLOOK
For further information on trends, management's outlook and corporate
priorities in 2015, please refer to section 3 of the Management's
Discussion and Analysis ("MD&A") for the three months ended March 31,
2015.
The selected financial information included in this press release is
qualified in its entirety by, and should be read together with the
Unaudited Condensed Interim Consolidated Financial Statements for the
three months ended March 31, 2015, and the MD&A for the three months
ended March 31, 2015, which can be found at dh.com and in the
disclosure documents filed by the Company with the securities
regulatory authorities at sedar.com.
MANAGEMENT CONFERENCE CALL AND WEBCAST
Teleconference:
A conference call to review these financial results, including a
presentation, will take place at 10:00 a.m. (EST) on Wednesday, April
29, 2015 hosted by Chief Executive Officer Gerrard Schmid and Chief
Financial Officer Karen H. Weaver. To access the call, please dial
647-427-7450 (Local/Int'l) or 1-888-231-8191 (toll-free within North
America). A replay of the call will also be available until May 13,
2015 by dialing 416-849-0833 (Local/Int'l) or 1-855-859-2056 (toll-free
within North America), with Encore Password 26002256.
Webcast:
The conference call will also be webcast at http://event.on24.com/r.htm?e=980347&s=1&k=154090EEAEACB4C2D89CFDC42E1E26FF and will be archived for 90 days after the call. The link to the
webcast and an accompanying slide presentation will be posted in the
Investors section of the D+H website under Events and Presentations at http://www.dh.com/investors/events-and-presentations/conference-calls.
ABOUT D+H
D+H (TSX: DH) is a leading financial technology provider the world's
financial institutions rely on every day to help them grow and succeed.
Our lending, payments and enterprise solutions are trusted by nearly
7,000 banks, specialty lenders, community banks, credit unions and
governments. Headquartered in Toronto, Canada, D+H has more than 4,000
employees worldwide who are passionate about partnering with clients to
create forward-thinking solutions that fit their needs. With annual
revenues of more than $1 billion, D+H is recognized as one of the
world's top FinTech companies on IDC Financial Insights FinTech
Rankings and American Banker's FinTech Forward ranking. For more
information, visit dh.com.
Use of Non-IFRS Financial Information
D+H's financial results are prepared in accordance with International
Financial Reporting Standards ("IFRS"). D+H reports several non-IFRS
financial measures, including Adjusted revenues, EBITDA, EBITDA margin,
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net income, Adjusted
net income per share, and Debt to EBITDA. See "Non-IFRS Financial
Measures" in D+H's MD&A for the three months ended March 31, 2015 for a
more complete description of these terms and for reconciliations to
their most directly comparable IFRS measures, where applicable. Any
non-IFRS financial measures should be considered in context with the
IFRS financial statement presentation and should not be considered in
isolation or as a substitute for IFRS revenues, net income or cash
flows. Furthermore, D+H's financial measures may be calculated
differently from similarly titled financial measures of other
companies.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains certain statements that constitute
forward-looking information within the meaning of applicable securities
laws ("forward-looking statements"). Statements concerning D+H's
objectives, goals, strategies, priorities, intentions, plans, beliefs,
expectations and estimates, and the business, operations, financial
performance and condition of D+H are forward-looking statements. The
words "believe", "expect", "anticipate", "estimate", "intend", "may",
"will", "would", "could", "should", "continue", "goal", "objective",
and similar expressions and the negative of such expressions are
intended to identify forward-looking statements, although not all
forward-looking statements contain these identifying words.
D+H has also made certain macroeconomic and general industry assumptions
in the preparation of such forward-looking statements. While D+H
considers these factors and assumptions to be reasonable based on
information currently available, there can be no assurance that actual
results will be consistent with these forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause D+H's actual results,
performance or achievements, or developments in its industry, to differ
materially from the anticipated results, performance, achievements or
developments expressed or implied by such forward-looking statements.
Risks related to forward-looking statements include, among other things,
increased pricing pressures and competition which could lead to loss of
contracts or reduced margins; the Company's ability to comply with
regulations; the Company's ability to deliver products and services in
line with the changes in the United States of America and Canadian
banking and financial services industry; the Company's ability to avoid
inherent risks in the technology industry related to cyber-security
threats and breaches; the Company's dependence on a limited number of
large financial institution customers in Canada and dependence on their
acceptance of new programs; declines in the use of personal and
business cheques; strategic initiatives being undertaken to grow our
business and increase profitability; stability and growth in the real
estate, mortgage and other lending markets; the Company's ability to
generate cash to invest in the business and at the same time be able to
pay dividends and debt repayments; as well as general market
conditions, including economic, foreign exchange and interest rate
dynamics. Given these uncertainties, readers are cautioned not to place
undue reliance on such forward-looking statements. The documents
incorporated by reference herein also identify additional factors that
could affect the operating results and performance of the Company.
Forward-looking statements are based on management's current plans,
estimates, projections, beliefs and opinions, and D+H does not
undertake any obligation to update forward-looking statements should
assumptions related to these plans, estimates, projections, beliefs and
opinions change except as required by applicable securities laws.
All of the forward-looking statements made in this press release are
qualified by these cautionary statements and other cautionary
statements or factors contained herein and there can be no assurance
that the actual results or developments will be realized or, even if
substantially realized, that they will have the expected consequences
to, or effects on, the Company.
REGULATORY FILINGS AND ADDITIONAL INFORMATION
DH Corporation is listed on the Toronto Stock Exchange under the symbol
DH. Further information can be found at dh.com and in the disclosure documents filed by DH Corporation with the
securities regulatory authorities at sedar.com.
SOURCE DH Corporation
