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Caldwell Reports Record Results

Thursday, 17 November 2022 05:05 PM

Caldwell Partners International, Inc.

  • Record full year revenue of $156.2 million
  • Record full year operating profit of $10.6 million

TORONTO, ON / ACCESSWIRE / November 17, 2022 / Talent acquisition firm The Caldwell Partners International Inc. (TSX:CWL)(OTCQX:CWLPF) today issued its financial results for the fiscal 2022 fourth quarter and full year ended August 31, 2022. All references to quarters or years are for the fiscal periods unless otherwise noted and all currency amounts are in Canadian dollars. Financial results include those of IQTalent Partners, Inc. (IQTalent) beginning on the date of acquisition of December 31, 2020.

Financial Highlights (in $000s except per share amounts)

Three Months Ended Year Ended
8.31.22 8.31.21 8.31.22 8.31.211
Professional fees - Caldwell
23,580 31,429 103,964 96,120
Professional fees - IQTalent2
12,153 10,181 51,596 23,287
Consolidated professional fees
35,733 41,610 155,560 119,407
Direct expense reimbursements
186 128 605 359
35,919 41,738 156,165 119,766
Cost of sales
28,028 32,468 120,911 90,621
Gross profit
7,705 9,142 34,649 29,120
Selling, general and administrative expenses
4,356 7,117 21,448 20,738
Acquisition-related expenses3
616 793 2,611 2,453
Operating profit
2,733 1,232 10,590 5,929
Earnings before tax
3,191 1,423 10,710 5,417
Income tax expense
616 440 2,532 898
Net earnings after tax
2,575 983 8,178 4,519
Basic earnings per share
$0.100 $0.039 $0.318 $0.190
  1. Results for the 12 months ended 8/31/21, exclude the pre-acquisition results of IQTalent, which had $5,931 of revenue.
  2. Professional fees of IQTalent are presented net of eliminations of intercompany revenue.
  3. Acquisition-related expenses consist of transaction fees and IQTalent purchase price structured as compensation expense, which will end on 12/31/22.

"This was an exceptional year in our firm's history, as we shattered previous records for revenue and profit" said John Wallace, chief executive officer. "Consolidated revenue for the year was $156.2 million, representing a year-over-year increase of over 30 percent, and our operating profit of $10.6 million was 79 percent higher than the prior year and the highest in our history, including our recording $2.6 million in purchase price costs related to the IQTalent acquisition. Fiscal 2022 was a year of revenue and profit achievement and execution excellence. We couldn't be prouder of the entire Caldwell/IQTalent team."

"While we celebrate our accomplishments in fiscal 2022, we are focused on the future. We have seen the business leaders at our clients become more cautious with concerns about an economic downturn or recession on the horizon. This has translated into a reduction in hiring demand, especially in the technology and retail sectors. We saw headwinds begin late summer and build through early fall - especially in our IQTalent segment, whose clients are weighted towards the technology sector. Accordingly, we have taken actions to right size the staff with business levels for the near term."

Wallace continued: "We are superbly confident regarding the strength of our company, our team, our service offerings, our balance sheet, and our future. Our clients value our ability to provide seamless support for their talent acquisition needs at all levels, and by continuing to diversify our mix of products and services and identify opportunities to cross-collaborate between our two business segments, we expect to amplify our current success in the long-term. We also continue to seek out strategic business and technology acquisition opportunities that align with our client-driven talent offerings. Our most recent acquisition of The Counsel Network has been a terrific addition to our Caldwell service offering in Canada, bringing a high-caliber group of search professionals focused on legal roles for law firms and corporate in-house functions."

About Caldwell Partners

Caldwell Partners is a technology-powered talent acquisition firm specializing in recruitment at all levels. Through two distinct brands - Caldwell and IQTalent - the firm leverages the latest innovations in AI to offer an integrated spectrum of services delivered by teams with deep knowledge in their respective areas. Services include candidate research and sourcing through to full recruitment at the professional, executive and board levels, as well as a suite of talent strategy and assessment tools that can help clients hire the right people, then manage and inspire them to achieve maximum business results.

Caldwell Partners' common shares are listed on The Toronto Stock Exchange (TSX: CWL) and trade on the OTCQX Market (OTCQX: CWLPF). Please visit our website at for further information.

Forward-Looking Statements

Forward-looking statements in this document are based on current expectations subject to the significant risks and uncertainties cited. These forward-looking statements generally can be identified by the use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan," "foresee," "may," "will," "likely," "estimates," "potential," "continue" or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements.

We are subject to many factors that could cause our actual results to differ materially from those contemplated by the relevant forward looking statement including, but not limited to, the impact of pandemic diseases, our ability to attract and retain key personnel; exposure to our partners taking our clients with them to another firm; the performance of the US, Canadian and international economies; foreign currency exchange rate fluctuations; competition from other companies directly or indirectly engaged in talent acquisition; cybersecurity requirements, vulnerabilities, threats and attacks; damage to our brand reputation; our ability to align our cost structure to changes in our revenue; liability risk in the services we perform; potential legal liability from clients, employees and candidates for employment; reliance on software that we license from third parties; reliance on third-party contractors for talent acquisition support; our ability to successfully recover from a disaster or other business continuity issues; adverse governmental and tax law rulings; successfully integrating or realizing the expected benefits from our acquisitions, adverse operating issues from acquired businesses; volatility of the market price and volume of our common shares; technological advances may significantly disrupt the labour market and weaken demand for human capital at a rapid rate; affiliation agreements may fail to renew or affiliates may be acquired; the impact on profitability from marketable securities valuation fluctuations; increasing dependence on third parties for the execution of critical functions; our ability to generate sufficient cash flow from operations to support our growth and fund any dividends; potential impairment of our acquired goodwill and intangible assets; and disruption as a result of actions of certain stockholders or potential acquirers of the Company. For more information on the factors that could affect the outcome of forward-looking statements, refer to the "Risk Factors" section of our Annual Information Form and other public filings (copies of which may be obtained at These factors should be considered carefully, and the reader should not place undue reliance on forward-looking statements. Although any forward-looking statements are based on what management currently believes to be reasonable assumptions, we cannot assure readers that actual results, performance, or achievements will be consistent with these forward-looking statements. Management's assumptions may prove to be incorrect. Except as required by Canadian securities laws, we do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf; such statements speak only as of the date made. The forward-looking statements included herein are expressly qualified in their entirety by this cautionary language.

For further information, please contact:

Chris Beck, President and Chief Financial Officer
[email protected]
+1 (617) 934-1843

Caroline Lomot, Director of Marketing
[email protected]
+1 (516) 830-3535

(in $000s Canadian)

As at As at
August 31 August 31
2022 2021
Current assets
Cash and cash equivalents
35,668 29,214
Accounts receivable
22,882 23,218
Income taxes receivable
1,280 -
Unbilled revenue
6,495 4,217
Prepaid expenses and other assets
2,758 2,332
69,083 58,981
Non-current assets
Restricted cash
- 2,624
736 242
241 506
Property and equipment
2,035 1,970
Right-of-use assets
5,345 9,549
Intangible assets
190 234
8,928 7,960
Deferred income taxes
4,730 5,067
Total assets
91,288 87,133
Current liabilities
Accounts payable
4,021 4,640
Compensation payable
43,866 36,852
Income taxes payable
- 3,007
Lease liability
1,817 1,868
Loans Payable
- 176
49,704 46,543
Non-current liabilities
Compensation payable
2,105 6,278
Lease liability
4,414 8,560
56,223 61,381
Equity attributable to owners of the Company
Share capital
12,554 12,157
Contributed surplus
15,045 15,063
Accumulated other comprehensive income
960 204
Retained earnings (deficit)
6,506 (1,672)
Total equity
35,065 25,752
Total liabilities and equity
91,288 87,133

(in $000s Canadian, except per share amounts)

Twelve months ended
August 31
2022 2021
Professional fees
155,560 119,407
Direct expense reimbursements
605 359
156,165 119,766
Cost of sales expenses
Cost of sales
120,911 90,621
Government stimulus grants
- (334)
Reimbursed direct expenses
605 359
121,516 90,646
Gross profit
34,649 29,120

Selling, general and administrative
21,448 20,738
Acquisition-related expenses
2,611 2,453
24,059 23,191
Operating profit
10,590 5,929
Finance expenses (income)
Interest expense on lease liability
419 464
Realized gain on lease modification
(182) -
Interest expense on loans payable
- 27
Investment income
(129) (32)
Foreign exchange (gain) loss
(228) 53
Earnings before income tax
10,710 5,417
Income tax expense
2,532 898
Net earnings for the year attributable to owners of the Company
8,178 4,519
Earnings per share
Basic and Diluted
$0.318 $0.190
$0.315 $0.186
(in $000s Canadian)
Twelve months ended
August 31
2022 2021
Net earnings for the period
8,178 4,519
Other comprehensive income:
Items that may be reclassified subsequently to net earnings
Gain (loss) on marketable securities
(72) 165
Cumulative translation adjustment
828 (380)
Comprehensive earnings for the year attributable to owners of the Company
8,934 4,304

(in $000s Canadian)

Accumulated Other Comprehensive
Income (Loss)
Retained Cumulative Gain/(loss) on
Earnings Contributed Translation Marketable Total
(Deficit) Share Capital Surplus Adjustment Securities Equity
Balance - August 31, 2020
(6,191) 7,515 15,013 595 (176) 16,756
Net earnings for the year
4,519 - - - - 4,519
Common share issuance
- 4,642 - - - 4,642
Share based payment expense
- - 50 - - 50
Gain on marketable securities available for sale
- - - - 165 165
Change in cumulative translation adjustment
- - - (380) - (380)
Balance - August 31, 2021
(1,672) 12,157 15,063 215 (11) 25,752
Net earnings for the year
8,178 - - - - 8,178
Employee share option plan share issue
- 397 (34) - - 363
Share-based payment expense
- - 16 - - 16
Loss on marketable securities available for sale
- - - - (72) (72)
Change in cumulative translation adjustment
- - - 828 - 828
Balance - August 31, 2022
6,506 12,554 15,045 1,043 (83) 35,065

(in $000s Canadian)

Twelve months ended
August 31
2022 2021
Cash flow provided by (used in)
Operating activities
Net earnings for the year
8,178 4,519
Add (deduct) items not affecting cash
Depreciation of property and equipment
421 393
Depreciation of right-of-use assets
2,095 1,982
Amortization of intangible assets
51 19
Amortization of advances
705 646
Interest expense on lease liabilities
419 464
Interest on loans payable
- 27
Share based payment expense
16 50
(Gain) loss on unrealized foreign exchange on subsidiary loans
(320) 13
Gain on early termination of lease
(182) (37)
Changes in working capital
(4,282) 16,802
Net cash provided by operating activities
7,101 24,878
Investing activities
Acquisition of business, net of cash
(314) (3,238)
Investment in convertible promissory note
(655) -
Purchase of property and equipment
(466) (251)
Payment of advances
(609) (437)
Proceeds from sale of marketable securities
127 289
Purchase of marketable securities
- (180)
Purchase of intangible assets
- (108)
Net cash used in investing activities
(1,917) (3,925)
Financing activities
Decrease (increase) in restricted cash
2,624 (2,619)
Payment of lease liabilities
(2,341) (2,619)
Proceeds from share issuance under employee stock option plan
363 -
Sublease payments received
29 346
Payment of loans payable
(176) (1,043)
Net cash provided by (used in) financing activities
499 (5,935)
Effect of exchange rate changes on cash and cash equivalents
771 (285)
Net increase in cash and cash equivalents
6,454 14,733
Cash and cash equivalents, beginning of year
29,214 14,481
Cash and cash equivalents, end of period
35,668 29,214

SOURCE: Caldwell Partners International, Inc.

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