Operating highlights:

Three months ended

Year ended

December 31

2024

2023

2024

2023

Revenues (millions)

1,365.3

1,079.3

5,216.9

4,334.5

Adjusted EBITDA (millions) (note 1)

137.9

103.3

513.7

415.7

Adjusted EPS (note 2)

1.34

1.11

5.00

4.66

GAAP Operating Earnings

89.6

48.1

337.5

244.9

GAAP EPS

0.71

0.14

2.97

2.24

TORONTO, Feb. 05, 2025 (GLOBE NEWSWIRE) -- FirstService Corporation (TSX:FSV, NASDAQ:FSV) today announced strong fourth quarter and full year results for the year ended December 31, 2024. All amounts are in US dollars.

Consolidated revenues for the fourth quarter were $1.37 billion, a 27% increase relative to the same quarter in the prior year, including 10% organic growth. Adjusted EBITDA (note 1) was $137.9 million, up 33%, and Adjusted EPS (note 2) was $1.34, a 21% increase over the prior year quarter. Operating Earnings for the quarter were $89.6 million, relative to $48.1 million in the prior year period. Diluted EPS was $0.71 per share in the quarter, compared to $0.14 for the same quarter a year ago.

For the year ended December 31, 2024, consolidated revenues were $5.22 billion, a 20% increase relative to the prior year. Adjusted EBITDA was $513.7 million, up 24%, and Adjusted EPS was $5.00, an increase of 7% versus the prior year. Operating Earnings were $337.5 million, versus $244.9 million in the prior year period. Diluted earnings per share was $2.97, compared to $2.24 in the prior year.

"We are very pleased with how we closed out the year," said Scott Patterson, Chief Executive Officer of FirstService. "Our teams were focused on driving healthy profitable growth which is reflected in the strong top-line and improved margins. This momentum and continued operational execution reinforces our expectations for a strong 2025," he concluded.

About FirstService Corporation

FirstService Corporation is a North American leader in the property services sector serving its customers through two industry leading platforms: FirstService Residential - North America's largest manager of residential communities; and FirstService Brands - one of North America's largest providers of essential property services delivered through individually branded company-owned operations and franchise systems.

FirstService generates more than US$5.2 billion in annual revenues and has approximately 30,000 employees across North America. With significant insider ownership and an experienced management team, FirstService has a long-term track record of creating value and superior returns for shareholders. The Common Shares of FirstService trade on the NASDAQ under the symbol "FSV" and on the Toronto Stock Exchange under the symbol "FSV", and are included in the S&P/TSX 60 Index. More information is available at www.ﬁrstservice.com.

Segmented Fourth Quarter Results

FirstService Residential generated revenues of $521.3 million for the fourth quarter, up 5% relative to the prior year quarter, including 3% organic growth. The top-line performance was underpinned by contract wins in high-rise markets including Texas, Toronto and Chicago, with growth tempered by the ongoing community budgetary pressures referenced in our prior third quarter. Adjusted EBITDA was $46.0 million, an increase of 6% compared to $43.5 million reported in the prior year period. Operating Earnings were $34.4 million, versus $34.1 million for the fourth quarter of last year. Operating margins were relatively in-line with the prior year quarter.

FirstService Brands recorded revenues of $844.1 million, up 45% versus the prior year period. Revenues increased 16% on an organic basis primarily due to increased weather events and large-loss claims activity at our restoration operations, compared to the prior year quarter. The division top-line performance also included contribution from our Roofing Corp of America acquisition which was acquired in December 2023. Adjusted EBITDA for the quarter was $100.7 million, compared to $61.1 million in the prior year quarter. Operating Earnings were $69.9 million, versus $20.6 million in the prior year quarter. The segment Adjusted EBITDA margin increase was mainly due to operating leverage at our restoration operations, as well as continued realization of cost efficiencies within our home services brands. The Operating Earnings margin was further buoyed by the same acquisition-related fair value adjustments to contingent upside earn-out structures noted in the prior third quarter.

Corporate costs, as presented in Adjusted EBITDA, were $8.9 million in the fourth quarter, relative to $1.2 million in the prior year period. Corporate costs for the quarter were $14.7 million, relative to $6.7 million in the prior year period. The increase was primarily due to non-cash foreign exchange adjustments.

Segmented Full Year Results

FirstService Residential reported revenues of $2.13 billion, up 7% relative to 2023, including 5% organic growth and the balance from tuck-under acquisitions. Organic growth was driven by new property management contract wins across most markets. Adjusted EBITDA was $199.3 million, up 6% versus the prior year. Operating Earnings were $159.2 million, compared to $155.0 million in the prior year. Operating margins were in-line with the prior year.

FirstService Brands revenues were $3.08 billion, up 32% versus the prior year, including 3% organic growth. Growth in the division was driven primarily by our Roofing Corp of America acquisition, together with solid organic growth at our Century Fire Protection operations. Adjusted EBITDA for the year was $339.5 million, up 40% relative to the prior year. Operating Earnings were $230.1 million, versus $126.5 million a year ago. The segment Adjusted EBITDA margin was positively impacted primarily by margin improvement within our home services brands. The Operating Earnings margin was further positively impacted from contingent acquisition consideration fair value adjustments.

Corporate costs, as presented in Adjusted EBITDA, were $25.1 million for the full year, relative to $14.4 million in the prior year. Corporate costs were $51.8 million, relative to $36.6 million in 2023, with the increase driven primarily by the impact of non-cash foreign exchange adjustments, as well as stock-based compensation expense.

Conference Call & Presentation

FirstService will be holding a conference call on Wednesday, February 5, 2025 at 11:00 a.m. Eastern Time to discuss the results for the fourth quarter and full year.

This call is being webcast live at the Company's website at www.firstservice.com. Participants may register for the call here https://register.vevent.com/register/BIc0caa93df85548909c3b68b8c526df66 to receive the dial-in number and their unique PIN. To join the webcast in listen only mode, use this link: https://edge.media-server.com/mmc/p/zvtxjnkg. It is recommended that you join 10 minutes prior to the event start (although you may register and dial in at any time during the call).

Forward-looking Statements

This press release includes or may include forward-looking statements. Much of this information can be identified by words such as "expect to," "expected," "will," "estimated" or similar expressions suggesting future outcomes or events. FirstService believes the expectations reflected in such forward-looking statements are reasonable but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results to be materially different from any future results, performance or achievements contemplated in the forward-looking statements. Such factors include: (i) general economic and business conditions, which will, among other things, impact demand for FirstService's services and the cost of providing services; (ii) the ability of FirstService to implement its business strategy, including FirstService's ability to acquire suitable acquisition candidates on acceptable terms and successfully integrate newly acquired businesses with its existing businesses; (iii) changes in or the failure to comply with government regulations; and (iv) other factors which are described in FirstService's annual information form for the year ended December 31, 2023 under the heading "Risk factors" (a copy of which may be obtained at www.sedarplus.ca) and Annual Report on Form 40-F filed with the United States Securities and Exchange Commission (a copy of which may be obtained at www.sec.gov), and subsequent filings (which factors are adopted herein). Forward-looking statements contained in this press release are made as of the date hereof and are subject to change. All forward-looking statements in this press release are qualified by these cautionary statements. Unless otherwise required by applicable securities laws, we do not intend, nor do we undertake any obligation, to update or revise any forward-looking statements contained in this press release to reflect subsequent information, events, results or circumstances or otherwise.

Summary financial information is provided in this press release. This press release should be read in conjunction with the Company's consolidated financial statements and MD&A to be made available on SEDAR+ at www.sedarplus.ca.

COMPANY CONTACTS:

D. Scott Patterson

Chief Executive Officer

Jeremy Rakusin

Chief Financial Officer

(416) 960-9566

Notes

1. Reconciliation of net earnings to adjusted EBITDA:

Adjusted EBITDA is defined as net earnings, adjusted to exclude: (i) income tax; (ii) other expense (income); (iii) interest expense; (iv) depreciation and amortization; (v) acquisition-related items; and (vi) stock-based compensation expense. The Company uses Adjusted EBITDA to evaluate its own operating performance and its ability to service debt, as well as an integral part of its planning and reporting systems. Additionally, this measure is used in conjunction with discounted cash flow models to determine the Company's overall enterprise valuation and to evaluate acquisition targets. Adjusted EBITDA is presented as a supplemental measure because the Company believes such measure is useful to investors as a reasonable indicator of operating performance because of the low capital intensity of its service operations. The Company believes this measure is a financial metric used by many investors to compare companies, especially in the services industry. This measure is not a recognized measure of financial performance under GAAP in the United States, and should not be considered as a substitute for operating earnings, net earnings or cash flow from operating activities, as determined in accordance with GAAP. The Company's method of calculating Adjusted EBITDA may differ from other issuers and accordingly, this measure may not be comparable to measures used by other issuers. A reconciliation of net earnings to Adjusted EBITDA appears below.

	Three months ended						Twelve months ended
(in thousands of US$)	December 31						December 31
	2024			2023			2024			2023

Net earnings	$	50,179		$	23,783		$	187,774		$	147,021
Income tax		19,153			12,051			70,124			56,317
Other income, net		(863	)		(595	)		(3,239	)		(5,810	)
Interest expense, net		21,146			12,823			82,853			47,364
Operating earnings		89,615			48,062			337,512			244,892
Depreciation and amortization		47,828			33,872			165,269			127,934
Acquisition-related items		(5,272	)		16,485			(14,402	)		21,517
Stock-based compensation expense		5,685			4,924			25,311			21,385
Adjusted EBITDA	$	137,856		$	103,343		$	513,690		$	415,728

A reconciliation of segment operating earnings to segment Adjusted EBITDA appears below.

(in thousands of US$)


Three months ended December 31, 2024		FirstService			FirstService
		Residential			Brands			Corporate ⁽¹⁾

Operating earnings (loss)	$	34,382		$	69,909		$	(14,676	)
Depreciation and amortization		10,439			37,366			23
Acquisition-related items		1,191			(6,578	)		115
Stock-based compensation expense		-			-			5,685
Adjusted EBITDA	$	46,012		$	100,697		$	(8,853	)


Three months ended December 31, 2023		FirstService			FirstService
		Residential			Brands			Corporate⁽¹⁾

Operating earnings (loss)	$	34,136		$	20,603		$	(6,677	)
Depreciation and amortization		8,373			25,477			22
Acquisition-related items		1,002			14,992			491
Stock-based compensation expense		-			-			4,924
Adjusted EBITDA	$	43,511		$	61,072		$	(1,240	)



Year ended December 31, 2024		FirstService			FirstService
		Residential			Brands			Corporate ⁽¹⁾

Operating earnings (loss)	$	159,206		$	230,080		$	(51,774	)
Depreciation and amortization		37,506			127,672			91
Acquisition-related items		2,576			(18,263	)		1,285
Stock-based compensation expense		-			-			25,311
Adjusted EBITDA	$	199,288		$	339,489		$	(25,087	)


Year ended December 31, 2023		FirstService			FirstService
		Residential			Brands			Corporate⁽¹⁾

Operating earnings (loss)	$	155,044		$	126,468		$	(36,620	)
Depreciation and amortization		33,114			94,729			91
Acquisition-related items		(366	)		21,159			724
Stock-based compensation expense		-			-			21,385
Adjusted EBITDA	$	187,792		$	242,356		$	(14,420	)


Segment Adjusted EBITDA margin is defined as segment Adjusted EBITDA divided by segment revenues.

(1) Corporate is not an operating segment, but rather represent corporate overhead expenses not directly attributable to reportable segments and are therefore unallocated within segment operating earnings (loss) and Segment Adjusted EBITDA.

2. Reconciliation of net earnings and net earnings (loss) per common share to adjusted net earnings and adjusted net earnings per share:

Adjusted EPS is defined as diluted net earnings per share, adjusted for the effect, after income tax, of: (i) the non-controlling interest redemption increment; (ii) acquisition-related items; (iii) amortization of intangible assets recognized in connection with acquisitions; and (iv) stock-based compensation expense. The Company believes this measure is useful to investors because it provides a supplemental way to understand the underlying operating performance of the Company and enhances the comparability of operating results from period to period. Adjusted EPS is not a recognized measure of financial performance under GAAP, and should not be considered as a substitute for diluted net earnings per common share, as determined in accordance with GAAP. The Company's method of calculating this non-GAAP measure may differ from other issuers and, accordingly, this measure may not be comparable to measures used by other issuers. A reconciliation of diluted net earnings per common share to Adjusted EPS appears below.

	Three months ended						Twelve months ended
(in thousands of US$)	December 31						December 31
	2024			2023			2024			2023

Net earnings	$	50,179		$	23,783		$	187,774		$	147,021
Non-controlling interest share of earnings		(3,639	)		(3,925	)		(15,624	)		(14,140	)
Acquisition-related items		(5,272	)		16,485			(14,402	)		21,517
Amortization of intangible assets		22,331			13,942			72,396			54,238
Stock-based compensation expense		5,685			4,924			25,311			21,385
Income tax on adjustments		(8,125	)		(4,905	)		(28,335	)		(19,662	)
Non-controlling interest on adjustments		(206	)		(665	)		(693	)		(1,517	)
Adjusted net earnings	$	60,953		$	49,639		$	226,427		$	208,842

	Three months ended						Twelve months ended
(in US$)	December 31						December 31
	2024			2023			2024			2023

Diluted net earnings per share	$	0.71		$	0.14		$	2.97		$	2.24
Non-controlling interest redemption increment		0.31			0.30			0.83			0.72
Acquisition-related items		(0.11	)		0.36			(0.31	)		0.47
Amortization of intangible assets, net of tax		0.34			0.23			1.11			0.88
Stock-based compensation expense, net of tax		0.09			0.08			0.40			0.35
Adjusted earnings per share	$	1.34		$	1.11		$	5.00		$	4.66

FIRSTSERVICE CORPORATION
Operating Results
(in thousands of US$, except per share amounts)
			Three months						Twelve months
			ended December 31						ended December 31
			2024			2023			2024			2023

Revenues		$	1,365,349		$	1,079,260		$	5,216,894		$	4,334,548

Cost of revenues			911,361			735,920			3,498,974			2,947,008
Selling, general and administrative expenses			321,817			244,921			1,229,541			993,197
Depreciation			25,497			19,930			92,873			73,696
Amortization of intangible assets			22,331			13,942			72,396			54,238
Acquisition-related items (1)			(5,272	)		16,485			(14,402	)		21,517
Operating earnings			89,615			48,062			337,512			244,892
Interest expense, net			21,146			12,823			82,853			47,364
Other income, net			(863	)		(595	)		(3,239	)		(5,810	)
Earnings before income tax			69,332			35,834			257,898			203,338
Income tax			19,153			12,051			70,124			56,317
Net earnings			50,179			23,783			187,774			147,021
Non-controlling interest share of earnings			3,639			3,925			15,624			14,140
Non-controlling interest redemption increment			14,064			13,596			37,775			32,490
Net earnings attributable to Company		$	32,476		$	6,262		$	134,375		$	100,391

Net earnings per common share

	Basic	$	0.72		$	0.14		$	2.98		$	2.25
	Diluted		0.71			0.14			2.97			2.24

Adjusted earnings per share (2)		$	1.34		$	1.11		$	5.00		$	4.66

Weighted average common shares (thousands)
	Basic		45,194			44,639			45,019			44,556
	Diluted		45,583			44,874			45,280			44,795

_{⁽¹⁾ Acquisition-related items include transaction costs, and contingent acquisition consideration fair value adjustments.}

_{⁽²⁾ See definition and reconciliation above.}

Condensed Consolidated Balance Sheets

(in thousands of US$)

December 31, 2024

December 31, 2023

Assets

Cash and cash equivalents

227,598

187,617

Restricted cash

16,088

19,260

Accounts receivable

947,517

842,236

Other current assets

368,150

311,889

Current assets

1,559,353

1,361,002

Other non-current assets

30,121

34,418

Fixed assets

253,994

204,188

Operating lease right-of-use assets

240,518

218,299

Goodwill and intangible assets

2,110,866

1,807,836

Total assets

4,194,852

3,625,743

Liabilities and shareholders' equity

Accounts payable and accrued liabilities

541,509

471,083

Other current liabilities

214,575

211,661

Operating lease liabilities - current

53,115

50,898

Long-term debt - current

41,567

37,132

Current liabilities

850,766

770,774

Long-term debt - non-current

1,257,143

1,144,975

Operating lease liabilities - non-current

214,423

183,923

Other liabilities

150,542

115,938

Deferred income tax

84,895

53,024

Redeemable non-controlling interests

449,337

332,963

Shareholders' equity

1,187,746

1,024,146

Total liabilities and equity

4,194,852

3,625,743

Supplemental balance sheet information

Total debt

1,298,710

1,182,107

Total debt, net of cash

1,071,112

994,490

Condensed Consolidated Statements of Cash Flows
(in thousands of US$)
			Three months ended						Twelve months ended
			December 31						December 31
			2024			2023			2024			2023

Cash provided by (used in)

Operating activities
Net earnings		$	50,179		$	23,783		$	187,774		$	147,021
Items not affecting cash:
	Depreciation and amortization		47,828			33,872			165,269			127,934
	Deferred income tax		(7,172	)		(18,413	)		(13,986	)		(19,049	)
	Other		(1,424	)		18,384			5,805			34,416
			89,411			57,626			344,862			290,322

Changes in non-cash working capital
	Accounts receivable		(22,323	)		(17,045	)		(42,306	)		(93,822	)
	Payables and accruals		15,249			38,159			22,602			19,662
	Other		4,382			36,040			(20,129	)		68,532

Contingent acquisition consideration paid			-			(4,334	)		(19,355	)		(4,334	)
Net cash provided by operating activities			86,719			110,446			285,674			280,360

Investing activities
Acquisition of businesses, net of cash acquired			(53,581	)		(434,366	)		(212,246	)		(547,182	)
Purchases of fixed assets			(31,916	)		(25,065	)		(112,798	)		(92,734	)
Other investing activities			(1,373	)		(6,173	)		1,342			(6,413	)
Net cash used in investing activities			(86,870	)		(465,604	)		(323,702	)		(646,329	)

Financing activities
Increase in long-term debt, net			3,613			390,998			103,577			446,847
Purchases of non-controlling interests, net			1,051			(111	)		(24,354	)		(4,285	)
Dividends paid to common shareholders			(11,277	)		(10,042	)		(43,828	)		(39,055	)
Distributions paid to non-controlling interests			(1,555	)		(454	)		(9,292	)		(7,376	)
Other financing activities			15,728			4,178			48,305			17,814
Net cash provided by financing activities			7,560			384,569			74,408			413,945

Effect of exchange rate changes on cash			229			(420	)		429			(447	)

Increase in cash, cash equivalents and restricted cash			7,638			28,991			36,809			47,529

Cash, cash equivalents and restricted cash, start of period			236,048			177,886			206,877			159,348

Cash, cash equivalents and restricted cash, end of period		$	243,686		$	206,877		$	243,686		$	206,877

Segmented Results
(in thousands of US$)


		FirstService		FirstService
		Residential		Brands		Corporate ⁽²⁾			Consolidated

Three months ended December 31

2024
	Revenues	$	521,256	$	844,093	$	-		$	1,365,349
	Adjusted EBITDA (1)		46,012		100,697		(8,853	)		137,856
	Operating earnings		34,382		69,909		(14,676	)		89,615

2023
	Revenues	$	496,281	$	582,979	$	-		$	1,079,260
	Adjusted EBITDA		43,511		61,072		(1,240	)		103,343
	Operating earnings		34,136		20,603		(6,677	)		48,062



		FirstService		FirstService
		Residential		Brands		Corporate			Consolidated

Year ended December 31

2024
	Revenues	$	2,134,469	$	3,082,425	$	-		$	5,216,894
	Adjusted EBITDA		199,288		339,489		(25,087	)		513,690
	Operating earnings		159,206		230,080		(51,774	)		337,512

2023
	Revenues	$	1,996,823	$	2,337,725	$	-		$	4,334,548
	Adjusted EBITDA		187,792		242,356		(14,420	)		415,728
	Operating earnings		155,044		126,468		(36,620	)		244,892


	(1) See definition and reconciliation on pages 5 and 6.
	(2) See definition on page 6.

FirstService Reports Fourth Quarter and Full Year Results