Q3 2024 Firstservice Corp Earnings Call Transcript
Key Points
- Consolidated revenues increased by 25% year-over-year, with organic growth at 6%, driven by acquisitions and strong performance in restoration brands.
- EBITDA for the quarter rose by 43% from the previous year, with a margin improvement of 150 basis points, reaching 11.5%.
- Earnings per share increased by 30%, reflecting strong financial performance.
- FirstService Brands division saw a 44% revenue increase, with significant contributions from the acquisition of Roofing Corp. of America and strong organic growth in restoration and fire safety segments.
- The company maintained a conservative balance sheet with a net debt-to-EBITDA ratio of 2.1 times, providing financial flexibility for future growth opportunities.
- FirstService Residential's revenue growth was below expectations, with only a 4% increase, impacted by budgetary pressures and rising costs, particularly in Florida.
- Organic growth in the residential segment is expected to remain in the low-single-digit range for the next few quarters due to ongoing budgetary constraints.
- Home improvement brands experienced a decline in revenues by a low-single-digit percentage, with expectations of continued modest declines into early 2025.
- The M&A environment is highly competitive with elevated valuations, particularly in the roofing sector, making acquisitions challenging.
- Interest expenses nearly doubled in the current quarter, impacting overall profitability despite strong earnings growth.
Good day and thank you for standing by. Welcome to the FirstService Corporation third-quarter 2024 earnings conference call. (Operator Instructions)
Please be advised that today's conference is being recorded. Legal counsel requires us to advise the discussion scheduled to take place today may contain forward-looking statements that may involve known and unknown risks and uncertainties. Actual results may be materially different from any future results, performance or achievements contemplated in the forward-looking statements.
Additional information concerning factors that could cause actual results to differ materially from those of the forward-looking statements is contained in the company's annual information form as filed with the Canadian Securities Administrators and in the company's annual (technical difficulty) and exchange commission. As a reminder, today's call is being recorded today, October 24, 2024.
I would now like to hand the conference over to Chief Executive Officer, Mr. Scott Patterson. Please go ahead, sir.
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