company.isc.ca
TSX:ISV
Corporate Overview
November 7, 2017
Corporate Overview November 7, 2017 company.isc.ca TSX:ISV ISC | - - PowerPoint PPT Presentation
Corporate Overview November 7, 2017 company.isc.ca TSX:ISV ISC | Forward-Looking Statement Forward-Looking Statement This presentation contains forward-looking information within the meaning of applicable Canadian securities legislation,
company.isc.ca
TSX:ISV
November 7, 2017
ISC | Forward-Looking Statement
This presentation contains forward-looking information within the meaning of applicable Canadian securities legislation, including management’s expectations and certain assumptions with respect to our registry services, corporate services and information products industry, our competitive landscape, economic conditions in Canada (in particular, Saskatchewan, Ontario and Quebec) and internationally, real estate market in Saskatchewan, economic impact of energy and resource sectors, fluctuations in the Canadian dollar and other foreign currencies, seasonality, 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 that impact our registry services, such as changes in high-value property registrations, motor vehicle sales volume and the number 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, our level of customer service and expected activity in the global registry market, 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
Annual Information Form, dated March 14, 2017, ISC’s Unaudited Interim Consolidated Financial Statements and Notes and Management’s Discussion and Analysis for the third quarter ended September 30, 2017, as well as other documents filed by ISC with Canadian securities regulators through SEDAR at www.sedar.com 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.
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company.isc.ca TSX:ISV
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company.isc.ca TSX:ISV
Leading provider of registry and information management services for public data and records. Saskatchewan’s exclusive provider
Directory, Personal Property Registry and Corporate Registry through ASD model.
Focus on growth. Corporate services and corporate accessories
in Ontario and Quebec.
company.isc.ca TSX:ISV
4 Registry technology solutions
and expertise with registry implementations on 3 continents.
Offering solutions to manage, secure and administer information through our registry and services segments. 2016 Financial highlights
Revenue $88.4M EBITDA $29.5M EBITDA margin 33.4% FCF $18.9M Basic EPS $0.89
TSX: ISV
Market cap $318.0M 52 week high $21.30 52 week low $16.57 Dividend per share $0.80 Dividend yield 4.5% As at Nov 7, 2017
ISC | Overview
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company.isc.ca TSX:ISV
ISC | Our Business at a Glance
We operate in two reportable segments defined by their primary type of service offering. The balance of our corporate activities and shared services functions, including the services and functions provided by our subsidiary, ERS, are reported as Corporate.
Geomatics)
Registration Saskatchewan Program)
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ISC | Our Business at a Glance
Individuals or businesses who directly benefit from ISC registries:
Intermediaries who manage relationships with end users but are typically not the beneficiary of our registry services:
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ISC | Our Business at a Glance
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ISC | Our Business at a Glance
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company.isc.ca TSX:ISV
Based in Ireland Founded in 2002
Acquired by ISC
Consulting
Implementation & support Registry implementations
3 continents
*The balance of our corporate activities and shared services functions, including the services and functions provided by our subsidiary ERS, are reported as Corporate.
ISC | Our Business at a Glance
TRANSACTION
Searches Registrations Maintenance and related services
SERVICE
Online or in person / Customized Online or in person Online or in person / Customized
REVENUE TYPE*
Flat fees (standard searches, e.g. $11 per land title search) Value-based fees (0.3% of the value of the land title) Flat fees (other registries) Flat or negotiated fees
* For a full list of our fees, go to www.isc.ca
TRANSACTION
Search & Registration Know-Your-Customer Corporate Supplies & Accessories
SERVICE
Online or in person / Customized In person Online or in person / Customized
REVENUE TYPE*
Flat fees Flat fees Per unit fees
* For a full list of our fees, go to www.eservicecorp.ca/index.php/pricing-turnaround-times
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ISC | Financial Position
remains strong with ability to fund growth
dividend.
Amount of cash on hand as at September 30, 2017
Amount of 2017 dividends paid to shareholders as at September 30, 2017
Free cash flow as at September 30, 2017
Total debt as at September 30, 2017
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company.isc.ca TSX:ISV
30.2 28.4 29.5 31.6 30.4 33.5
2014 2015 2016
EBITDA
ISC | Financial Position
Consolidated EBITDA1 and consolidated adjusted EBITDA1 for the year ended December 31 (CAD$ millions)
1EBITDA, 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 period ended December 31, 2016.
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$0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $100
2013 2014 2015 2016
Millions
Revenue EBITDA
Annual Revenue/ EBITDA
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$0 $5 $10 $15 $20 $25 $30 $35 2013 2014 2015 2016
Millions
EBITDA Long term debt (current and non-current)
Annual EBITDA/Debt
$0 $5 $10 $15 $20 $25 $30 $35 2013 2014 2015 2016
Millions
EBITDA Interest paid (per cash flow statement)
Annual EBITDA/Interest payments
ISC | Financial Position
Total revenue for the year ended December 31 (CAD$ millions)
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80.5 78.3 88.4
2014 2015 2016
Land Surveys Directory Geomatics Services Corporate Registry Personal Property Registry Land Titles Registry
company.isc.ca TSX:ISV
ISC | Financial Position
EBITDA margin
EPS (basic share)
Total revenue 17
company.isc.ca TSX:ISV
*The balance of our corporate activities and shared services functions, including the services and functions provided by our subsidiary ERS, are reported as Corporate/Other.
ISC | Financial Position
Thousands of CAD dollars; except earnings per share and where noted Three Months Ended Sep 30, 2017 Three Months Ended Sep 30, 2016 Nine Months Ended Sep 30, 2017 Nine Months Ended Sep 30, 2016
Revenue $23,862 $22,894 $70,004 $67,174 Net income $1,856 $3,810 $9,015 $12,584 EBITDA1 $7,579 $7,338 $22,171 $22,697 Adjusted EBITDA1 $8,673 $9,512 $24,447 $26,117 EBITDA margin1 (% of revenue) 31.8% 32.1% 31.7% 33.8% Adjusted EBITDA margin1 36.4% 41.5% 34.9% 38.9% Free cash flow1 $8,013 $5,641 $21,362 $15,254 Dividend declared per share $0.20 $0.20 $0.60 $0.60 Earnings per share2 (basic) $0.11 $0.22 $0.52 $0.72 Earnings per share, (diluted)2 $0.11 $0.22 $0.51 $0.72
1. EBITDA, EBITDA margin, adjusted EBITDA, adjusted EBITDA margin and free cash flow are not recognized as a measure reported under IFRS and do not have a standardized meaning prescribed by IFRS. See section “Non-IFRS Measures” in Management’s Discussion & Analysis for the three and nine months ended September 30, 2017. 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.
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ISC | Outlook
Continued focus on sustaining our core business while pursuing new growth opportunities. Expected consolidated annual EBITDA margin between 31% and 33%. Revised CapEx guidance of $1.0 - $2.0 million from $3.5 - $5.0 million. Temperate economic growth in Saskatchewan for Registries results similar to 2016, with modest growth for Ontario and Quebec economies to deliver moderate growth in the Services segment.
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ISC | Growth
Outsourcing Business Processes & Services
Governments, legal firms and financial institutions are looking to find cost savings and focus on their core business without compromising service quality.
Increased Regulatory & Compliance Requirements
Improved workflows and automated processes help meet requirements and reduce potential business risk for clients.
Emphasis on Reliability & Security of Information
ISC has the know-how, processes, technology and proven experience to manage data authentication and security. 21
company.isc.ca TSX:ISV
Emerging Global Registry Market
ISC continues to believe the global registry market is an emerging sector.
ISC | Growth
Become More Efficient Internally
Grow bottom line by:
Explore New Paths Externally
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ISC | Investment Proposition
Increased emphasis on technology solutions
An expanded leadership team
Sale of 30% stake in Dye & Durham
sheet to support corporate objectives and priorities. 23
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ISC | Investment Proposition
Strong Core Business
including data license
Emerging Diversification
Financial Position
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company.isc.ca TSX:ISV ISC | Appendices
ISC | Appendices
Shares Outstanding Listing Market Cap 52-Week High 52-Week Low Dividend History Contact 17.5 million Class A Limited Voting Shares TSX: ISV $318.0 million $21.30 $16.57 $0.80 per share annually (paid quarterly) since 2013
Investor.relations@isc.ca or call toll free 1-855-341-8363
As at November 7, 2017
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RBC Steve Arthur, CFA August 7, 2013 GMP Securities Justin Keywood, CFA February 3, 2014 CIBC Stephanie Price July 15, 2014 Sentry Investments, Inc. 14.85% QV Investors Inc. 9.31% Burgundy Asset Management Ltd. 3.80% Mackenzie Financial Corporation 2.05% Mawer Investment Management Ltd. 1.00%
ISC | Appendices
Top 5 Institutional Holders
Institutional Shareholder % O/S
Analyst Coverage
Institution Cover initiated on: Analyst
Ownership Distribution 36% 33% 31%
Retail Investors Institutional Investors Government of Saskatchewan 28 As at Oct 31, 2017
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Kathy Hillman-Weir, Q.C. Executive Vice-President, Chief Corporate Officer and General Counsel Shawn B. Peters Executive Vice-President and Chief Financial Officer Jeff Stusek President and Chief Executive Officer Kenneth W. Budzak Executive Vice-President, Registry Operations Loren Cisyk Executive Vice-President, Technology Solutions Laurel Garven Vice-President, Business Strategy Catherine McLean Vice-President, People and Culture Dennis White Vice-President, Marketing and Business Development
company.isc.ca TSX:ISV
From left: Doug Emsley, Iraj Pourian, Scott Musgrave, Karyn Brooks, Tom Christiansen, Joel Teal, Tony Guglielmin, Michelle Ouellette, Q.C., Dion Tchorzewski
ISC | Appendices
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ISC | Appendices
Thousands of CAD dollars Three Months Ended Sep 30, 2017 Three Months Ended Sep 30, 2016
Land Registry (Land Titles Registry, Land Surveys, and Geomatics) $14,335 $15,015 Personal Property Registry 2,531 2,670 Corporate Registry 2,237 1,860 Registries revenue 19,103 19,545 Services revenue 3,561 3,316 Other revenue 1,198 33 Total revenue $23,862 $22,894 31
company.isc.ca TSX:ISV