Altus Group Limited · TSX:AIF
Altus — Q3 2022 Earnings Presentation
32 slides from Altus's earnings presentation, Nov 10, 2022
Slide 1: Q3 2022 Earnings Call & Webcast
Q3 2022 Earnings Call & Webcast Nov. 10, 2022
Slide 2: Camilla Bartosiewicz, Chief Communications Officer
Camilla Bartosiewicz Chief Communications Officer
Slide 3: Forward-looking information & statements
Forward-looking information & statements Certain information in this presentation and on the Q3 2022 results earnings call and webcast may constitute “forward-looking information” within the meaning of applicable securities legislation. All information contained in this press release, other than sta
Slide 4: Non-GAAP and other measures
Non-GAAP and other measures Non-GAAP financial measures We use certain non-GAAP measures as indicators of financial performance. Readers are cautioned that they are not defined performance measures, and do not have any standardized meaning under IFRS and may differ from similar computations as repor
Slide 5: Angelo Bartolini, Chief Financial Officer
Angelo Bartolini Chief Financial Officer
Slide 6: Q3 2022 highlights
Q3 2022 highlights All % growth rates are on constant currency over Q3 2021 unless otherwise stated: 18% 34% 18.5% $7M Consolidated Adj. EBITDA Consolidated Revenues Consolidated Adj. EBITDA* Consolidated Profit Margin* 240 bps y/y 35% 6% 332% $0.15 Cash from Operations Earnings Per Share (EPS) Anal
Slide 7: Strong consolidated performance
Strong consolidated performance Q3 Q3 Year-over-year change $ CAD Millions 2022 2021 As Reported Constant Currency 13.2% Revenues $177.7 $151.8 17.1% 18.1% Organic Revenues* (y/y, CC) Profit (Loss) $6.8 (-$0.3) 2,414.2% EPS (basic & diluted) $0.15 (-$0.01) 1,600.0% consecutive Adjusted EBITDA* $32.9
Slide 8: Growing revenues & expanding margins at Analytics
Growing revenues & expanding margins at Analytics Q3 Q3 Year-over-year change Constant $ CAD Millions 2022 2021 As Reported Currency 25.0% Revenues $87.6 $65.1 34.6% 34.8% Organic Revenues* (y/y, CC) Over Time $76.9 $55.1 39.6% 40.1% Revenues* Adjusted EBITDA* $20.9 $11.7 78.4% 75.8% 28.2% Organic O
Slide 9: Expanding Analytics Adjusted EBITDA margins
Expanding Analytics Adjusted EBITDA margins* 30% 25% 23.9% 590 bps y/y 18.4% YTD Adj. EBITDA margin* 20% 110 bps y/y from 17.3% YTD Q3/21 16.6% 16.8% 15% 14.0% Balancing growth & 10% investments to steadily expand annual margins 5% 0% FY 2021 Q1 2022 Q2 2022 Q3 2022 9 * Non-GAAP measure
Slide 10: Growing Over Time revenue base at Analytics
Growing Over Time revenue base at Analytics C$ (M) Over Time Revenues* $90 $80 $76.9 M $70 40.1% $60 (y/y, CC) $50 $40 $30 28.2% Organic Over Time Revenues* (y/y, CC) $20 $10 ~86% of YTD Analytics revenues are Over Time $0 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 20
Slide 11: Solid Analytics Bookings growth
Solid Analytics Bookings* growth C$ (M) $35 $30 $25 $26.9 M 27.9% Total Bookings (y/y, CC) $20 $15 $10 54.5% $5 Recurring Bookings* (y/y, CC) $0 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 11 * Non-GAAP measure CC = constant currency
Slide 12: Steady performance at CRE Consulting
Steady performance at CRE Consulting REVENUES ADJUSTED EBITDA Q3 Q3 Year-over-year change Q3 Q3 Year-over-year change Constant Constant $ CAD Millions 2022 2021 As Reported Currency $ CAD Millions 2022 2021 As Reported Currency Property Tax $60.7 $58.5 3.9% 6.0% Property Tax $17.8 $18.6 4.5% 3.5% Va
Slide 13: Strong balance sheet enables continued investment in growth
Strong balance sheet enables continued investment in growth FUNDED DEBT TO $46.6 M CASH POSITION 2.29x ADJUSTED EBITDA RATIO Compared to 2.63x in Q2 2022 and well below maximum limit of 4.5x BANK NET DEBT TO $324.0 M DEBT 2.20x ADJUSTED EBITDA RATIO* 13 * Non-GAAP measure
Slide 14: Jim Hannon, Chief Executive Officer
Jim Hannon Chief Executive Officer
Slide 15: Solid foundation for long-term growth
Solid foundation for long-term growth 40% 12% Over Time Revenues* Revenue 5-yr CAGR (Q3, y/y, CC) PROPERTY (2017 – 2022 TTM) ANALYTICS TAX 24% High recurring Steady multi- 34% Q3 Adj. EBITDA margins* revenue growth year revenue YTD Adj. EBITDA 590 bps y/y & margin growth & cash Margins* expansion ge
Slide 16: Steady ARGUS cloud adoption
Steady ARGUS cloud adoption 60% 55% 50% Target to exit 40% 2022 with low-to- mid 60% AE 30% Cloud Adoption Rate* 20% 10% 0% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 16 * Non-GAAP measure
Slide 17: Positioned for predictive analytics
Positioned for predictive analytics Altus Expert Services Applications Valuation Transactions Performance Tax Mgmt Strategy Advanced ✓ Descriptive ✓ Predictive Analytics Asset ✓ Always current ✓ Prescriptive ✓ Comprehensive Intelligence ✓ Valuation-ready Altus Performance Platform (APP) 17 ⍺ optimiz
Slide 18: Successfully executing on business transformation
Successfully executing on business transformation 2022 strategic priorities: YTD progress: YTD over 2021, constant currency %: FOCUS Consolidated revenues Analytics Over CRE Consulting revenue 20%, profit $7M, Time revenue* 8% at 28% Adj. • Sales execution to drive profitable revenue growth in tier
Slide 19: Q&A - For all investor inquiries please email
Q&A For all investor inquiries please email IR@altusgroup.com
Slide 20: Appendix
rN AltusGroup Appendix
Slide 21: Steady profitable revenue growth
Steady profitable revenue growth C$M Altus Analytics Property Tax Valuation & Cost +20% $700 YTD, CC $625M $600 $562M $552M $526M 114 $500 $467M 113 89 $430M 111 $398M $400 107 $350M 102 260 96 213 245 $300 90 177 213 2019 aspirational 159 $200 134 151 target to double 251 250 Analytics revenue $100
Slide 22: Resilient, recurring & repeatable revenue streams
Resilient, recurring & repeatable revenue streams APAC, Valuation 4% & Cost 16% Canada, EMEA, 27% Altus 25% Diversified by Analytics 45% Property Tax offer & geography 39% U.S., 44% YTD Sept. 30, 2022 ALTUS ANALYTICS CRE CONSULTING Proven stability across various • High recurring subscription revenu
Slide 23: Selected financial information
Selected financial information Three months ended Sept. 30, Nine months ended Sept. 30, CONSOLIDATED 2022 2021 2022 2021 Revenues $ 177,691 $ 151,797 $ 551,689 $ 462,478 Canada 27% 28% 27% 30% U.S. 49% 41% 44% 36% Europe 19% 26% 25% 29% Asia Pacific 5% 5% 4% 5% Adjusted EBITDA (1) $ 32,910 $ 24,415
Slide 24: Business segment performance
Business segment performance Three months ended September 30, Nine months ended September 30, ALTUS ANALYTICS 2022 2021 % Change CC % Change 2022 2021 % Change CC % Change Revenues $ 87,599 $ 65,101 34.6% 34.8% $ 250,042 $ 178,677 39.9% 40.1% Adjusted EBITDA* $ 20,917 $ 11,728 78.4% 75.8% $ 45,906 $
Slide 25: Reconciliation of Adjusted EBITDA to Profit (Loss)
Reconciliation of Adjusted EBITDA to Profit (Loss) Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Adjusted EBITDA $ 32,910 $ 24,415 $ 100,394 $ 83,894 Occupancy costs calculated on a similar basis prior to the adoption of IFRS 16 (1) 2,868 3,294 9,088 9,722 Depr
Slide 26: Reconciliation of Adjusted Earnings (Loss) Per Share to Profit (Loss)
Reconciliation of Adjusted Earnings (Loss) Per Share to Profit (Loss) Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 Profit (loss) for the period $ 6,827 $ (295) $ 7,870 $ 18,683 Occupancy costs calculated on a similar basis prior to the adoption of IFRS 16 (1)
Slide 27: Cash flow summary
Cash flow summary Three months ended Sept. 30, Nine months ended Sept. 30, 2022 2021 2022 2021 Net cash related to operating activities $ 24,167 $ 5,600 $ 49,620 $ 45,535 Net cash related to financing activities (37,585) (7,940) (5,005) 106,529 Net cash related to investing activities (6,969) (5,993
Slide 28: Debt, leverage & liquidity
Debt, leverage & liquidity Funded debt to Adjusted Net debt to Adjusted Liquidity as at Sept. 30, 2022: Quarter end Cash position Total bank debt EBITDA ratio EBITDA ratio* Q3 2022 $46.6 M $324.0 M 2.29x 2.20x Q2 2022 $67.1 M $345.0 M 2.63x 2.37x Cash $46.6 M Q1 2022 $46.8 M $306.7 M 2.60x 2.37x Ban
Slide 29: Summary of quarterly results
Summary of quarterly results 2022 2021 2020 Q3 Q2 Q1 FY 2021 Q4 Q3 Q2 Q1 FY 2020 Q4 Results of Operations Revenues $ 177,691 $ 206,414 $ 167,584 $ 625,387 $ 162,909 $ 151,797 $ 173,523 $ 137,158 $ 561,156 $ 139,480 Adjusted EBITDA $ 32,910 $ 49,743 $ 17,741 $ 109,755 $ 25,861 $ 24,415 $ 42,239 $ 17,
Slide 30: Non-GAAP and other measures definitions
Non-GAAP and other measures definitions • Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is a non-GAAP financial measure which represents profit (loss) adjusted for the effects of: profit (loss) from discontinued operations, occupancy costs calculated on
Slide 31: Non-GAAP and other measures definitions
Non-GAAP and other measures definitions • Bookings is a supplementary financial measure for the Altus Analytics business segment. We define Bookings as the annual contract value for new sales of our recurring offerings (software, Appraisal Management and data subscriptions) and the total contract va
Slide 32: Upcoming IR conferences & events
Upcoming IR conferences & events Members of Altus’ executive leadership team are scheduled to participate in the following investor conferences in November: • RBC Capital Markets Global Technology, Internet, Media and Telecommunications Conference • New York City, November 16 • Jim Hannon (Chief Exe