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ISC Reports First Quarter 2015 Financial Results

May 5, 2015

REGINA, May 5, 2015 /CNW/ - Information Services Corporation (TSX:ISV) ("ISC" or the "Company"), Saskatchewan's exclusive provider of key registry information services, today reported on the Company's financial results for the first quarter ended March 31, 2015. 

First Quarter 2015 Highlights

  • Revenue of $16.0 million
  • EBITDA (earnings before interest, taxes, depreciation and amortization) of $3.8 million
  • EBITDA margin of 23.5 per cent
  • Net income of $1.7 million or $0.10 per share


Financial Position as at March 31, 2015

  • Cash of $37.0 million
  • Free cash flow of $2.1 million
  • Total debt of $9.9 million


Commenting on the Company's results, Jeff Stusek, President and CEO stated, "As one might expect, our first quarter results were impacted by the slowing economic conditions in Saskatchewan for the first three months of 2015. The first quarter is typically our slowest quarter but results are down year-over-year as compared to 2014 and the impact early in the quarter was more than expected. Ours is not a business that should be viewed quarter over quarter, but rather is a long-term business with a solid foundation in Saskatchewan. I am confident that our business has the right balance of financial strength and prudent expense management to deal with quarterly fluctuations. That does not mean we are immune to the impact and while there is still upside potential in the real estate market, we do expect our year-end EBITDA margin to be about 2 percent lower than previously forecasted. In the long term, we remain committed to protecting the stability of our results and will continue to pay close attention to the economic outlook."

Management's Discussion of ISC's Summary of First Quarter 2015 Financial Results


(Thousands of CAD dollars,

except earnings per share and where noted)


Three Months


March 31, 2015


Three Months


March 31, 2014




Land Titles Registry, Land Surveys Directory and Geomatics






Personal Property Registry






Corporate Registry











Total revenue


$ 16,011


$ 17,405




$ 3,763


$ 4,983

EBITDA margin1 (% of Revenues)





Adjusted EBITDA1


$ 3,781


$ 5,371

Adjusted EBITDA margin2





Net income and total comprehensive income


$ 1,720


$ 2,799

Earnings per share3





Free cash flow1


$ 2,053


$ 1,858









EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin and free cash flow are not recognized as measures under IFRS and do not have a standardized meaning prescribed by IFRS and therefore, are not comparable to similar measures by other corporations. See section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended March 31, 2015.


The Company has updated its calculation of adjusted EBITDA. Previous adjustments related to the costs of the Company's IPO and normalization adjustments related to the transfer of the Government of Saskatchewan's Vital Statistics Registry are no longer applicable. Instead, EBITDA was adjusted for stock-based compensation expense or income, equity settled employee benefit reserve, transactional gains and losses, asset impairment charges, and acquisition and integration costs. Refer to section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended March 31, 2015 for further information and for reconciliations of EBITDA and adjusted EBITDA, refer to section name "Financial Measures and Key Performance Indicators".



Adjusted EBITDA margin for 2014, which previously mirrored the EBITDA margin, has been adjusted to conform to the new calculation of adjusted EBITDA margin outlined in the section name "Non-IFRS Measures" in the Management's Discussion & Analysis for the three months ended March 31, 2015.



The calculation of earnings per share is based on net income after tax and the weighted average number of shares outstanding during the period.


  • Revenue for the Land Titles Registry, Land Surveys Directory and Geomatics was $11.7 million for the three months ended March 31, 2015; a decrease of $1.3 million, or 10.2 per cent, compared to the three months ended March 31, 2014. Results were weaker in the first quarter of 2015, as compared to the same period in 2014, largely due to the slowing of the Saskatchewan economy.
  • Revenue for Personal Property Registry for the three months ended March 31, 2015 was flat at $2.1 million, when compared to the same period in 2014. Overall transaction volume was down for the first quarter of 2015 by 2.4 per cent compared to the same period last year. The main driver of revenue for this registry, personal property security registration setups, has shown a decrease in volume of 10.2 per cent. However, revenue was flat when compared to the same period last year due to increases in the average price per setup as a result of registry fee increases and longer term registrations.
  • Revenue for the Corporate Registry for the three months ended March 31, 2015 was $2.2 million, a decrease of 2.9 per cent when compared to the three months ended March 31, 2014. Revenue from the incorporation of new businesses, included in registrations, declined by 14.8 per cent in the same period; however, this was partially offset by an increase in revenue of 1.2 per cent from the filing of annual returns, which is included in maintenance.
  • Expenses were flat at $13.6 million for the three months ended March 31, 2015 compared to the three months ended March 31, 2014.
  • Capital expenditures for the three months ended March 31, 2015 were $1.0 million, compared to $0.7 million for the same period in 2014. Capital expenditures for the first quarter in 2015 were focused on the enhancement of technology supporting the Corporate Registry and general office improvements.
  • As at March 31, 2015 the Company held $37.0 million in cash compared to $33.6 million as at December 31, 2014, an increase of $3.4 million.
  • The Company had $9.9 million of long-term debt and no short-term borrowings as at March 31, 2015. 



In 2015, ISC expects to continue to focus on delivering stable and predictable returns.

The MSA and related Registry Operating Agreements specify the maximum fees allowed to be charged to the public for particular Core Registry Services as per the MSA. The maximum fees are adjustable on a yearly basis and are based on a formula tied to inflation as measured by the Saskatchewan Consumer Price Index published by Statistics Canada. These adjustment provisions do not apply to any value-based fees. There are no restrictions on the fees ISC may charge for non-core Ancillary Services that use registry data. ISC expects to generally adjust prices as outlined in the MSA.

Given that adjustments to our prices are fixed as outlined above, and that the majority of our revenue is linked to economic conditions in Saskatchewan, the Company expects that revenue for 2015 will be impacted. We anticipate variability in quarterly revenue due to increased volatility in the housing and mortgage markets. This is based on a period of moderate economic uncertainty for the Saskatchewan economy in 2015, which is supported by a number of banks reforecasting their growth expectations downward for 2015 for the province.

For example, according to Bank of Montreal Capital Markets1 most recent economic forecast for Saskatchewan, the provincial economy is expected to post real gross domestic product ("GDP") growth of 1.0 per cent in 2015, revised downward from 1.9 per cent at the end of February 2015.

The Company expects the housing market, which is a key revenue driver of the Land Registry, to be impacted. Canada Mortgage and Housing Corporation Housing ("CMHC") Market Outlook currently forecasts a decrease of 1.9 per cent in existing home sales volume in Saskatchewan for 2015. CMHC also currently forecasts average home resale prices to increase by 1.4 per cent in 20152, down from their 2014 fourth quarter forecast of 2.1 percent.

Saskatchewan housing starts for the three months ended March 31, 2015 were down 25.2 per cent compared to same period in 2014, while the number of completions was up 11.2 per cent3. This increase in completions has contributed to a buyers' market in certain parts of the province. The extra inventory may have, and may continue to, impact average sales prices in 2015, resulting in softer year-over-year growth.

As well, the Land Titles Registry saw a large number of high value property registrations in 2014, which generate a high fee per transaction. High value property registrations in 2013 and 2014 were higher than our long-term average. High value property registrations have started to return to a normalized level in 2015 and we expect this trend to continue for the rest of 2015, which directly impacts revenue.

For the PPR, new vehicle sales are an indicator for registration activity. For all of 2014, the number of units of new vehicles sold decreased 1.2 per cent compared to the same period in 2013.4 Scotiabank revised earlier forecasts downward, expecting annual motor vehicle sales in Saskatchewan to be 55,000 in 2015, an expected decrease over 2014 volumes5.

There is risk that consumer behaviour will be affected depending on the duration of this climate of uncertainty. Inactivity could occur if consumers take a "wait and see" approach to their larger purchases such as homes and vehicles. Businesses could scale back or ramp up their investments, depending on which sector they are in. Further changes to interest rates could also impact consumer behaviour. As provincial economic conditions change, the Company's revenue may be impacted.

Recent cuts in interest rates by the Bank of Canada, followed by the major banks, are intended to stimulate the economy. In addition, the outlook on potash prices is generally positive and the strengthening of the United States economy and the drop in the value of the Canadian dollar could positively impact Saskatchewan exports. These factors could positively impact ISC's registries.

ISC has also monitored the decline in the price of oil and the potential impact to the Company. While there is no clear link between the price of oil and the Company's revenue, oil and gas is one segment of the Saskatchewan economy, and therefore could have an impact on our overall registry business.

In 2015, given uncertain economic conditions described above, ISC expects its EBITDA margin to be about 2.0 per cent lower than previously forecasted. ISC's key drivers of expenses will continue to be wages and salaries and information technology costs as the Company continues to focus on efficiency and effectiveness, leveraging investment in systems and processes while maintaining a high level of customer service. However, inflationary impacts are expected to move these costs marginally higher in 2015.

Management expects capital expenditures in 2015 to be in the range of $4.0 million to $6.0 million funded from operating cash flow. These expenditures are primarily expected to be sustaining capital expenditures which include general office improvements, enhancement and upgrades to core technology components and enterprise systems, and the continuation of the renewal and enhancement of the technology supporting the Corporate Registry.

1 BMO Capital Markets Economics – Provincial Economic Outlook – April 17, 2015 and February 27, 2015.
2 CMHC Housing Market Outlook – Canadian Edition – First Quarter 2015.
3 Statistics Canada Table 027-0001: Canada Mortgage and Housing Corporation, housing starts, under construction, completions in centres 10,000 and over, CANSIM (database), accessed April 10, 2015.
4 Statistics Canada Table 079-0003: New motor vehicle sales, Canada, provinces and territories, CAMSIM (database), accessed April 16, 2015.
5 Scotiabank Global Economics – Global Forecast Update – March 31, 2015.

Note to Readers:

This news release provides a general summary of Information Services Corporation's results for the first quarters ended March 31, 2015 and 2014.  Readers are encouraged to download the Company's complete financial disclosures. Links to ISC's financial statements and related notes and Management's Discussion and Analysis for the period are available on ISC's website in the Investor section of the site at All figures are in Canadian dollars unless otherwise noted.

Copies can also be obtained at by searching Information Services Corporation's profile or by contacting Information Services Corporation at

Conference Call And Webcast

The Company is hosting a conference call and webcast at 9:00 a.m. Saskatchewan Time; 11:00 a.m. Eastern Time on May 6, 2015 to discuss these results. Dial-in numbers for the conference call are:

1-416-764-8688 or toll-free at 1-888-390-0546.

A live audiocast of the conference call is available at the following link:

The webcast will be available for replay 24 hours after the event until 11:59 p.m. EST on June 6, 2015 at   

About ISC

ISC is an experienced provider of registry and information services for government, individuals and private sector business.  As the exclusive provider of the land titles, surveys, personal property and corporate registries for Saskatchewan, the Company maintains and operates these registries, which are key supporters of economic activity in the province.

Cautionary Note Regarding Forward-Looking Information

This news release contains forward-looking information within the meaning of applicable Canadian securities legislation, including management's expectations and certain assumptions with respect to the  registry services and products, its competitive landscape, the Saskatchewan economy, consumer confidence, interest rates, level of unemployment, inflation, real estate market in Saskatchewan, impact of prices for agricultural commodities, oil and potash,  claim liabilities, income taxes, our ability to attract and retain skilled staff, the compensation and benefits that will be paid or provided to employees and our level of customer service, as well as goodwill and intangibles are material factors in preparing forward-looking statements. In addition, the words ''may'', ''will'', ''would'', ''should'', ''could'', ''expect'', ''plan'', ''intend'', ''trend'', ''indicate'', ''anticipate'', ''believe'', ''estimate'', ''predict'', ''project'', ''targets'', ''strive'', ''strategy'', ''continue'', ''likely'' or ''potential'' or the negative or other variations of these words or other comparable words or phrases are intended to identify forward-looking statements. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those expressed or implied by such forward-looking information. Although ISC believes the forward-looking information contained in this release is based upon reasonable assumptions, readers are cautioned not to place undue reliance on forward-looking information as it is inherently uncertain and no assurance can be given that the expectations reflected in such information will prove to be correct. Many factors and risks could cause our actual results to differ materially from those expressed or implied by forward-looking information including those detailed in ISC's Annual Information Form, dated March 17, 2015, ISC's Consolidated Financial Statements and Notes and Management's Discussion and Analysis for the year ended December 31, 2014 as well as other documents filed by ISC with Canadian securities regulators through SEDAR at from time to time. Investors and others should carefully consider the above-noted factors and risks and other uncertainties and potential events. The forward-looking information in this release is made as of the date hereof and, except as required under applicable securities legislation, ISC assumes no obligation to update or revise such information to reflect new events or circumstances.

SOURCE Information Services Corporation

Interactive Analyst Centre


Please note that you are now entering a website directly or indirectly maintained by a third party (the "External Site") and that you do so at your own risk.

Information Services Corporation (“ISC”) has no control over the External Site, any data or other content contained therein or any additional linked websites. The link to the External Site is provided for convenience purposes only.

By clicking “Accept” you acknowledge and agree that neither ISC nor third party provider Virtua Research, Inc. (“Virtua") is responsible, or accepts or assumes any responsibility or liability whatsoever for, the content, the data or the technical operation of the Linked Site. Further, by entering the External Site, you also acknowledge and agree that you completely and irrevocably waive any and all rights and claims against ISC and Virtua and further acknowledge and agree that in no event shall ISC or Virtua, its officers, employees, directors and agents be liable for any (i) indirect, consequential, incidental, special, compensatory or punitive damages, (ii) damages for loss of income, loss of business profits, business interruption, loss of data or business information, loss of or damage to property, (iii) claims of third parties, or (iv) other pecuniary loss, arising out of or related to the Legal Notice, this disclaimer or the External Site.

By entering the External Site, you further acknowledge and agree that the disclaimer of warranties and limitations of liability set out in this disclaimer shall apply regardless of the causes, circumstances or form of action giving rise to the loss, damage, claim or liability, even if such loss, damage, claim or liability is based upon breach of contract (including, without limitation, a claim of fundamental breach or breach of a fundamental term), tort (including, without limitation, negligence), strict liability or any other legal or equitable theory, and even if ISC and Virtua are advised of the possibility of the loss, damage, claim or liability. The waiver and release specifically includes, without limitation, any and all rights and claims pertaining to the processing of personal data, including but not limited to any rights under any applicable data protection statute(s).

If in any jurisdiction, any part of this disclaimer is held to be unenforceable by a court of competent jurisdiction, such part of this disclaimer shall be restricted or eliminated to the minimum extent and the remaining disclaimer shall otherwise remain in full force and effect.

Please note the information presented is deemed representative at the time of its original release. Changes in historical information may occur due to adjustments in accounting and reporting standards & procedures.

Non-IFRS Information

In addition to disclosing results determined in accordance with IFRS, ISC may also disclose certain non-IFRS and pro forma non-IFRS results of operations, including certain ratios, operational and miscellaneous data, as well as net income, diluted earnings per share, operating expenses, and operating income that make certain adjustments or exclude certain charges and gains that are outlined in the schedules included in this website. Management believes that this non-IFRS and pro forma non-IFRS information provides investors with additional information to assess ISC operating performance by making certain adjustments or excluding costs or gains and assists investors in comparing our operating performance to prior periods. Management uses this non-IFRS and pro forma non-IFRS information, along with IFRS information, in evaluating its historical operating performance. ISC and Virtua also take no responsibility for third party pricing data provided for informational purposes and certain ratio results formulated from the provided third party pricing data.

The non-IFRS information is not prepared in accordance with IFRS and may not be comparable to non-IFRS information used by other companies. The non-IFRS information should not be viewed as a substitute for, or superior to, other data prepared in accordance with IFRS.