News Column

Stantec reports solid second quarter 2014 results and dividend

August 7, 2014

EDMONTON, ALBERTA and NEW YORK, NEW YORK--(Marketwired - Aug. 7, 2014) - Stantec Inc. (TSX:STN) (NYSE:STN)

Today, Stantec announced solid second quarter 2014 results, with several key items to highlight:

-- Gross revenue increased 11.8% to C$633.8 million in Q2 14 from C$566.7

million in Q2 13 -- Net income increased 22.4% to C$44.3 million in Q2 14 from C$36.2 million in Q2 13 -- Diluted earnings per share increased 20.5% to C$0.94 in Q2 14 from



C$0.78 in Q2 13 -- The Company declared a quarterly dividend of C$0.185 per share -- Stantec executed on its disciplined acquisition strategy by closing the

acquisition of four firms in Q2 14: JBR Environmental Consultants, Inc.;

Group Affiliates Inc. (SHW); Wiley Engineering, Inc.; and USKH Inc.

The Company's positive performance in the quarter and year to date is a result of sustained activity throughout the organization and organic growth in its Energy & Resources and Infrastructure business operating units. For the first half of the year, Stantec's gross revenue grew organically by 4.7%.

"As we move into the second half of the year, Stantec's performance continues to meet expectations and deliver solid results," says Bob Gomes, Stantec president and chief executive officer. "For this, we recognize our hardworking employees who continue to provide creative solutions that build strong, local communities."

Designing with Community in Mind

Stantec achieves its purpose of creating communities by offering its expertise and services across three business operating units: Buildings, Energy & Resources, and Infrastructure.

In Stantec's Buildings business operating unit, the Company's integrated services model, together with global recognition of its expertise, allows the Company to secure projects despite a slow recovery in this market. A notable project awarded to Stantec this quarter is to perform architecture and engineering design to support the build-out of an inspection and secondary packaging area for a drug manufacturer in the San Francisco Bay area in California.

In its Energy & Resources business operating unit, on a year-to-date basis, Stantec experienced growth in all of its sectors, primarily in Oil & Gas. Stantec continues to benefit from a reputation as a top integrated provider of midstream services-a market that remains very active in Canada and presents opportunities as it expands and evolves in the United States.

In Stantec's Infrastructure business operating unit, Stantec's reputation for project delivery expertise and its strengthened presence in the United States continue to provide opportunities in both the development of new infrastructure and the renewal of aging facilities and roadways. For example, in the quarter, Stantec secured work on the City of Atlanta's Raw Water Delivery System project where a tunnel, raw-water-filled quarry, and related facilities will provide operational flexibility to the city's existing transmission mains. This project will be one of the largest design-build tunnels ever designed in North America.

Strategic Growth

Stantec closed four acquisitions in Q2 14, successfully executing on its consistent, disciplined acquisition strategy with the addition of JBR Environmental Consultants, Inc.; Group Affiliates Inc. (SHW); Wiley Engineering, Inc.; and USKH Inc., adding over 580 employees in the quarter, and 1,140 employees to the Company year to date. Stantec is seeing the resulting growth from its acquisition strategy in both depth of services and market reach, particularly in the western United States, the Midwest and Mid-Atlantic states, and the resource-rich northern areas of North America. This growth further strengthens Stantec's capacity to deliver results with more than 14,000 employees in over 230 locations across North America and internationally.

Additional Company Activity

Subsequent to the quarter end, Stantec declared a dividend of $0.185 per share, payable on October 16, 2014, to shareholders of record on September 26, 2014.

Conference Call and Company Information

Stantec's second quarter conference call, to be held Thursday, August 7, 2014, at 2:00 PM MDT (4:00 PM EDT), will be broadcast live and archived in the Investors section of www.stantec.com. Financial analysts who wish to participate in the earnings conference call are invited to call 1-800-499-4035 and provide confirmation code 9703011 to the operator.

About Stantec

We're active members of the communities we serve. That's why at Stantec, we always design with community in mind.

The Stantec community unites more than 14,000 employees working in over 230 locations. We collaborate across disciplines and industries to bring buildings, energy and resource, and infrastructure projects to life. Our work-professional consulting in planning, engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics-begins at the intersection of community, creativity, and client relationships.

Since 1954, our local strength, knowledge, and relationships, coupled with our world-class expertise, have allowed us to go anywhere to meet our clients' needs in more creative and personalized ways. With a long-term commitment to the people and places we serve, Stantec has the unique ability to connect to projects on a personal level and advance the quality of life in communities across the globe. Stantec trades on the TSX and the NYSE under the symbol STN.

Cautionary Statements

Stantec's gross revenue is an additional IFRS measure. For a definition and explanation of additional IFRS measures, refer to the Critical Accounting Estimates, Developments, and Measures section of the Company's 2013 Annual Report.

Certain statements contained in this news release constitute forward-looking statements. Any such statements represent the views of management only as of the date hereof and are presented for the purpose of assisting the Company's shareholders in understanding Stantec's operations, objectives, priorities, and anticipated financial performance as at and for the periods ended on the dates presented, and may not be appropriate for other purposes. By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties.

We caution readers of this news release not to place undue reliance on our forward-looking statements since a number of factors could cause actual future results to differ materially from the expectations expressed in these forward-looking statements. These factors include, but are not limited to, the risk of an economic downturn, changing market conditions for Stantec's services, disruptions in government funding, the risk that Stantec will not meet its growth or revenue targets, and the risk that the projects contemplated in this news release will not be completed when expected or at all. Investors and the public should carefully consider these factors, other uncertainties, and potential events, as well as the inherent uncertainty of forward-looking statements, when relying on these statements to make decisions with respect to our Company.

For more information on how other material risk factors could affect our results, refer to the Risk Factors section and Cautionary Note Regarding Forward-Looking Statements in our 2013 Annual Report. You may obtain our 2013 Annual Report by visiting EDGAR on the SEC website at www.sec.gov or on the CSA website at www.sedar.com or at www.stantec.com. Alternatively, you may obtain a hard copy of the 2013 Annual Report free of charge from our Investor Contact noted below.

Design with community in mind

Consolidated Statements of Financial Position (Unaudited) June 30December 31 2014 2013

(In thousands of Canadian dollars) $ $ ----------------------------------------------------------------------------

ASSETS Current Cash and cash equivalents 117,736 143,030 Trade and other receivables 413,124 384,907 Unbilled revenue 217,060 143,894 Income taxes recoverable 11,115 8,792 Prepaid expenses 17,954 18,959 Other financial assets 28,252 21,418 Other assets 2,731 5,231

----------------------------------------------------------------------------

Total current assets 807,972 726,231 Non-current Property and equipment 150,029 133,534 Goodwill 688,051 594,826 Intangible assets 92,515 78,857

Investments in joint ventures and associates 4,616 4,996 Deferred tax assets 48,459 45,383 Other financial assets 89,834 83,163 Other assets 1,222 1,188 ---------------------------------------------------------------------------- Total assets 1,882,698 1,668,178 ============================================================================ LIABILITIES AND SHAREHOLDERS' EQUITY Current Trade and other payables 243,615 259,113 Billings in excess of costs 96,418 77,803 Income taxes payable - 9,127 Current portion of long-term debt 52,587 37,130 Provisions 11,535 12,047 Other financial liabilities 2,207 1,927 Other liabilities 10,431 9,837 ----------------------------------------------------------------------------

Total current liabilities 416,793 406,984 Non-current Long-term debt 322,907 200,943 Provisions 52,692 49,539 Deferred tax liabilities 64,902 58,082 Other financial liabilities 2,224 2,041 Other liabilities 59,387 57,955

---------------------------------------------------------------------------- Total liabilities 918,905 775,544 ---------------------------------------------------------------------------- Shareholders' equity Share capital 269,904 262,573 Contributed surplus 12,776 12,369 Retained earnings 666,613 606,056 Accumulated other comprehensive income 14,500 11,636 ---------------------------------------------------------------------------- Total Shareholders' equity 963,793 892,634 ----------------------------------------------------------------------------



Total liabilities and shareholders' equity 1,882,698 1,668,178 ============================================================================

Consolidated Statements of Income (Unaudited) For the two quarters For the quarter ended ended June 30June 30



--------------------------------------------

(In thousands of Canadian

dollars, except per share 2014 2013 2014 2013 amounts) $ $ $ $ ---------------------------------------------------------------------------- Gross revenue 633,819 566,724 1,207,712 1,079,931



Less subconsultant and other

direct expenses 103,568 97,275 196,206 183,630 ---------------------------------------------------------------------------- Net revenue 530,251 469,449 1,011,506 896,301 Direct payroll costs 240,229 214,946 459,851 411,471 ----------------------------------------------------------------------------

Gross margin 290,022 254,503 551,655 484,830 Administrative and marketing expenses 211,803 187,749 411,715 363,137 Depreciation of property and equipment 9,175 7,717 17,999 14,999 Amortization of intangible assets 5,788 6,268 11,152 12,072 Net interest expense 2,172 2,247 3,697 4,566 Other net finance expense 758 751 1,416 1,349 Share of income from joint ventures and associates (581) (361) (1,386) (569) Foreign exchange (gain) loss (179) 218 89 324 Other income (24) (60) (390) (368)



----------------------------------------------------------------------------

Income before income taxes 61,110 49,974 107,363 89,320 ----------------------------------------------------------------------------

Income taxes Current 17,495 16,345 27,821 27,231 Deferred (690) (2,502) 1,704



(2,489)

----------------------------------------------------------------------------

Total income taxes 16,805 13,843 29,525 24,742 ---------------------------------------------------------------------------- Net income for the period 44,305 36,131 77,838 64,578 ============================================================================



Weighted average number of

shares outstanding - basic 46,704,903 46,176,303 46,664,414 46,116,563 ----------------------------------------------------------------------------

Weighted average number of

shares outstanding - diluted 47,151,907 46,479,367 47,136,251 46,414,325 ----------------------------------------------------------------------------

Shares outstanding, end of the

period 46,752,166 46,216,049 46,752,166 46,216,049 ============================================================================ Earnings per share Basic 0.95 0.78 1.67 1.40 ---------------------------------------------------------------------------- Diluted 0.94 0.78 1.65 1.39 ============================================================================ FOR FURTHER INFORMATION PLEASE CONTACT: Media Contact Sherry Brownlee Stantec Media Relations (780) 917-7264 sherry.brownlee@stantec.com Investor Contact Crystal Verbeek Stantec Investor Relations (780) 969-3349 crystal.verbeek@stantec.comwww.stantec.com Source: Stantec Inc.


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Marketwire (Canada)


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters