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ISC Reports First Quarter 2016 Financial Results

May 9, 2016

REGINA, SASKATCHEWAN--(Marketwired - May 9, 2016) - Information Services Corporation (TSX:ISV) ("ISC" or the "Company") today reported on the Company's financial results for the first quarter ended March 31, 2016.

First Quarter 2016 Highlights

  • Revenue of $19.6 million
  • EBITDA (earnings before interest, taxes, depreciation and amortization) of $5.1 million
  • EBITDA margin of 25.9 per cent
  • Net income of $2.2 million or $0.13 per basic share
  • Amendment of Master Service Agreement to continue to manage and operate the Common Business Identifier Program and the Business Registration Saskatchewan Program for an annual operating fee of $825 thousand.

Financial Position as at March 31, 2016

  • Cash of $33.8 million
  • Free cash flow of $3.3 million
  • Total debt of $24.2 million

Commenting on the Company's results, Jeff Stusek, President and CEO stated, "The first quarter of 2016 was a solid start to the year for us. Both our Registries and Services segments performed well and made strong contributions to our results. The year over year improvement in our free cash flow and margins is a reflection of the addition of ESC to our revenue stream as well as our prudent management of expenses, which continues to serve us well in a flat economy. We will continue to stay the course while we look for ways to further diversify our revenue stream and generate long-term shareholder value."

Management's Discussion of ISC's Summary of First Quarter 2016 Financial Results
(thousands of CAD dollars;
except earnings per share and
where noted)
Three Months Ended
March 31, 2016
Three Months Ended
March 31, 2015
Revenue - Registries
Land Registry $ 11,495 $ 11,704
Personal Property Registry 2,227 2,108
Corporate Registry 2,591 2,198
Total 16,313 16,010
Revenue - Services 3,277 -
Revenue - Other 16 1
TOTAL Revenue $ 19,606 $ 16,011
EBITDA1 $ 5,077 $ 3,763
EBITDA margin1 (% of revenue) 25.9% 23.5%
Adjusted EBITDA1 $ 5,472 $ 3,781
Adjusted EBITDA margin1 27.9% 23.6%
Net income and total comprehensive income $ 2,196 $ 1,720
Earnings per share (basic)2 $ 0.13 $ 0.10
Free cash flow1 $ 3,316 $ 2,053
Expenses $16,359 $13,568
1. 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, 2016.
2. The calculation of earnings per share is based on net income after tax and the weighted average number of shares outstanding during the period.

First Quarter 2016 Results of Operations

  • Total revenue for ISC for the three months ended March 31, 2016, was $19.6 million, a $3.6 million increase when compared to the same period in 2015. The increase was mainly due to the inclusion of ESC, which was acquired on October 1, 2015.

  • Revenue for our Registries segment was $16.3 million, an increase of $0.3 million or 1.9 per cent, compared to the first quarter 2015. Results improved due to gains from the Corporate Registry and the Personal Property Registry, which more than offset declines from the Land Registry.

    • Revenue for the Land Registry was $11.5 million, a decrease of $0.2 million or 1.8 per cent, compared to the first quarter 2015.

    • Revenue for the Personal Property Registry for the three months ended March 31, 2016, was $2.2 million, which represents a rise of 5.6 per cent from the same period in 2015.

    • Revenue for the Corporate Registry for the three months ended March 31, 2016 was $2.6 million, an increase of $0.4 million or 17.8 per cent compared to the first quarter 2015.

  • The revenue in our Services segment for the first quarter, which consists of revenue earned by our wholly owned subsidiary ESC, was $3.3 million. This is an improvement of $0.1 million or 3.5 per cent, compared to the fourth quarter of 2015.

  • Consolidated expenses (including ESC) for the three months ended March 31, 2016, were $16.4 million, an increase of $2.8 million, compared to $13.6 million for the same period of 2015.

  • Depreciation and amortization was $1.8 million for the three months ended March 31, 2016, compared to $1.3 million in the same period of 2015. The increase was mainly due to the additional depreciation from capital assets of ESC.

  • Capital expenditures for the three months ended March 31, 2016, were $1.3 million, compared to $1.0 million for the same period in 2015. Capital expenditures were focused on the renewal and enhancement of technology supporting the Corporate Registry as well as various sustaining initiatives around general office improvements.

  • As at March 31, 2016, the Company held $33.8 million in cash compared to $36.6 million as at December 31, 2015, a decrease of $2.8 million.

  • The Company had $24.2 million of debt as at March 31, 2015. For more details, see section named "9.3 Long-term debt" in the Management's Discussion & Analysis for the three months ended March 31, 2016.


The majority of the Company's revenue is linked to registry transaction volumes and values which are driven by economic conditions in Saskatchewan. The remaining portion of our revenue is linked to the overall economic conditions in Ontario and Quebec. At present, the Company expects the 2016 Saskatchewan economy to be similar to 2015, while moderate growth is anticipated for the central Canadian markets. As a result, ISC reiterates that its expected consolidated EBITDA margin for fiscal 2016 will be in the range of 32.0 to 34.0 per cent.

In our Registries segment, the Saskatchewan economy was challenged in 2015 as the province's energy sector coped with lower oil prices as well as general softness in other resource-based sectors. As noted above, the Company currently expects that the 2016 Saskatchewan economy will be similar to 2015. According to several external forecasts, Saskatchewan's real GDP growth is expected to be near zero after a weak 2015.

Overall, we anticipate transaction volumes in the Land Titles Registry for 2016 to be near 2015 levels, with high value property registrations to return towards normalized levels. For the Personal Property Registry, we forecast a slight increase overall, with revenues from search volumes offsetting anticipated declines from lower new motor vehicle sales in Saskatchewan and reduced property security registration setups. For the Corporate Registry, steady growth of active business entities and related search volume should contribute to stabilized revenue.

As it relates to pricing for the Registries segment, the MSA and related Registry Operating Agreements specify the maximum fees allowed to be charged to the public for particular Core Registry Services. Generally, fees are adjustable on an annual basis using a formula tied to Saskatchewan CPI. ISC anticipates an adjustment in pricing in 2016 as outlined in the MSA.

In our Services segment, we expect the growth of ESC's core business to continue in specific categories relating to the financial services and legal sectors in both its core markets of Ontario and Quebec. The expectation is that the growing base of new customers, as well as new mandates from existing customers, will continue to support overall revenue growth. We expect a continued focus on cost efficiencies to improve margins.

The key drivers of expenses will continue to be wages, salaries and information technology costs. The Company will continue to manage its costs prudently while balancing re-investment in the business in order to maintain or improve the customer experience.

Management expects capital expenditures in 2016 to be in the range of $5.0 million to $6.0 million, funded from operating cash flow. These expenditures are projected to include the completion of the renewal and enhancement of our Corporate Registry technology, enhancement and upgrades to core technology components and enterprise systems, and general office improvements.

Note to Readers

This news release provides a general summary of Information Services Corporation's results for the first quarters ended March 31, 2016 and 2015. 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 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 10, 2016 to discuss these results. Dial-in numbers for the conference call are:

1-416-340-2216 or toll-free at 1-866-225-0198.

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

The webcast will be available for replay 24 hours after the event at

The Company also advises that it will hold its annual general meeting (the "AGM") of shareholders on Monday, May 16, 2016. The AGM will begin at 1 p.m. MDT (3 p.m. ET) and a live audio webcast will be available on the Company's website at Information related to the AGM can be found in ISC's Management Information Circular, which is available on the Company's website at ISC encourages shareholders to access the information and vote by no later than 1 p.m. (Saskatchewan/MDT) on Thursday, May 12, 2016.

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, economic conditions in Canada and in particular, Saskatchewan, Ontario and Quebec, real estate market in Saskatchewan, economic impact of energy and resource sectors, transaction volumes, statements regarding the future financial position or results of ISC, customer growth and diversification, dividend expectations, creation of shareholder value, growth opportunities, capital and operating expectations, real gross domestic product, changes in high-value property registrations, changes in motor vehicle sales volume, steady growth of active business entities, consolidated EBITDA margin, 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 15, 2016, ISC's Consolidated Financial Statements and Notes and Management's Discussion and Analysis for the year ended March 31, 2016 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.

Jonathan Hackshaw
Director, Investor Relations & Corporate Communications
Information Services Corporation

Pamela Keck
Manager, Investor Relations
Toll Free: 1-855-341-8363 in North America or 1-306-798-1137

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.